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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________
FORM 10-K/A
(MARK ONE)
/x/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
FOR THE FISCAL YEAR ENDED APRIL 29, 1995
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
COMMISSION FILE NUMBER 0-15077
SHOREWOOD PACKAGING CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 11-2742734
(State or other jurisdiction (IRS employer
of incorporation or organization) identification No.)
277 PARK AVENUE
(Address of principal executive offices)
10172
(Zip Code)
(212) 371-1500
Registrant's telephone number, including area code
______________________
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
TITLE OF EACH CLASS: NAME OF EACH EXCHANGE ON WHICH REGISTERED
- -------------------- -----------------------------------------
None Not Applicable
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
Common Stock, $.01 par value
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes /x/ No / /
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.
As of July 26, 1995, the aggregate market value of the Registrant's
common stock held by non-affiliates of the Registrant was approximately
$263,950,080. (This figure was computed on the basis of the average of the
high and low selling prices for the Registrant's common stock on July 26,
1995). Non-affiliates include all shareholders of Registrant other than
executive officers, directors and 5% shareholders who are employees of the
Registrant. As of July 26, 1995, there were 19,367,599 shares of the
Registrant's common stock, $.01 par value per share, issued and outstanding.
The information required in Part III of this Form 10-K is incorporated
by reference from the Registrant's definitive proxy statement for the October
19, 1995 annual meeting of stockholders.
The Exhibit Index is Located on Page 7. Total Pages: 116
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PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a)(1) Financial Statements. See "Index to Financial Statements and
Supplementary Data" in Item 8.
(a)(2) Financial Statements Schedules. The financial statement
schedules have not been included because they are not
applicable or the information is included in financial
statements or notes thereto.
(a)(3) Exhibits
NUMBER DESCRIPTION
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3.1 -- Certificate of Incorporation of the Company, as amended,
incorporated by reference to the corresponding Exhibit item to
Registration Statement on Form S-1, as amended, as filed with the
Commission on September 4, 1986, Commission File No. 33-8490.
3.2 -- Amended and Restated By-laws of the Company, incorporated by
reference to the corresponding Exhibit item to Amendment No. 1 to
Registration Statement on Form S-1, as filed with the Commission
on October 20, 1986, Commission File No. 33-8490.
9.1 -- Intentionally Omitted.
10.1 -- through 10.4 Intentionally Omitted.
10.5 -- Agreement of Lease dated May 20, 1977 between Frank X. Mascioli
and Shorewood Packaging Corporation, a New York corporation,
relating to premises located at 55 Engineers Lane, Farmingdale,
New York, incorporated by reference to the corresponding Exhibit
item to Registration Statement on Form S-1, as amended, as filed
with the Commission on September 4, 1986, Commission File No.
33-8490.
10.6 -- and 10.7 Intentionally Omitted.
10.8 -- Lease dated June 13, 1979 between Ravin Investments Limited and
Shorewood Packaging Corp. of Canada Limited, as amended as of
March 14, 1983, between Pension Fund Realty Limited and Shorewood
Packaging Corp. of Canada Limited, relating to premises located
at 2220 Midland Avenue, Scarborough, Ontario, Canada,
incorporated by reference to the corresponding Exhibit item to
Registration Statement on Form S-1, as amended, as filed with the
Commission on September 4, 1986, Commission File No. 33-8490.
10.9 -- Lease Agreement dated November 1, 1984 between The Beneficiary Of
Land Trust Established With American National Bank and Trust
Company of Chicago and Shorewood Packaging Company of Illinois,
Inc., relating to the Countryside Executive Center in Palatine,
Illinois, incorporated by reference to the corresponding Exhibit
item to Registration Statement on Form S-1, as amended, as filed
with the Commission on September 4, 1986, Commission File No.
33-8490.
10.10 -- through 10.39 Intentionally Omitted.
10.40 -- Non-Competition Agreement dated as of June 20, 1985 between
Shorewood Packaging Corporation of New York and Paul B. Shore,
incorporated by reference to the corresponding Exhibit item to
Registration Statement on Form S-1, as amended, as filed with the
Commission on September 4, 1986, Commission File No. 33-8490.
10.41 -- Non-Competition Agreement dated as of June 20, 1985 between
Shorewood Packaging Corporation of New York and Marc P. Shore,
incorporated by reference to the corresponding Exhibit item to
Registration Statement on Form S-1, as amended, as filed with the
Commission on September 4, 1986, Commission File No. 33-8490.
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10.42 -- Non-Competition Agreement dated as of June 20, 1985 between
Shorewood Packaging Corporation of New York and Floyd Glinert,
incorporated by reference to the corresponding Exhibit item to
Registration Statement on Form S-1, as amended, as filed with the
Commission on September 4, 1986, Commission File No. 33-8490.
10.43 -- Non-Competition Agreement dated as of June 20, 1985 between
Shorewood Packaging Corporation of New York and Murray B.
Frischer, incorporated by reference to the corresponding Exhibit
item to Registration Statement on Form S-1, as amended, as filed
with the Commission on September 4, 1986, Commission File No.
33-8490.
10.44 -- Non-Competition Agreement dated as of June 20, 1985 between
Shorewood Packaging Corporation of New York and Charles
Kreussling, incorporated by reference to the corresponding
Exhibit item to Registration Statement on Form S-1, as amended,
as filed with the Commission on September 4, 1986, Commission
File No. 33-8490.
10.45 -- Non-Competition Agreement dated as of June 20, 1985 between
Shorewood Packaging Corporation of New York and Kenneth
Rosenblum, incorporated by reference to the corresponding Exhibit
item to Registration Statement on Form S-1, as amended, as filed
with the Commission on September 4, 1986, Commission File No.
33-8490.
10.46 -- through 10.50 Intentionally Omitted.
10.51 -- Lease dated as of April 30, 1987 between Shorewood Packaging
Corporation and Blamore Real Estate Company relating to the
premises located at 10 East 53rd Street, New York, New York,
incorporated by reference to the corresponding Exhibit item to
Registration Statement on Form S-1, as amended, as filed with the
Commission on June 5, 1987, Commission File No. 33-14395.
10.52 -- through 10.56 Intentionally Omitted.
10.57 -- Asset Purchase Agreement, dated as of August 1, 1988, by and
among Goody Products, Inc., Southeastern Box Co., Inc., Shorewood
Packaging Corporation and Shorewood Box Co., Inc., incorporated
by reference to the corresponding Exhibit item to Quarterly
Report on Form 10-Q for the quarter ended July 30, 1988 filed
with the Commission on August 30, 1988, Commission file No.
0-15077.
10.58 -- Agreement, dated August 1, 1988, by and between Goody Products,
Inc. and Shorewood Packaging Corporation, incorporated by
reference to the corresponding Exhibit item to Quarterly Report
on Form 10-Q for the quarter ended July 30, 1988 filed with the
Commission on August 30, 1988. Commission file No. 0-15077.
10.59 -- through 10.77 Intentionally Omitted.
10.78 -- Asset Purchase Agreement dated December 23, 1993 by and among
Shorewood Paperboard Corporation Limited, Shorewood Acquisition
Corporation of Delaware, Paperboard Industries Corporation and
Paperboard Industries Inc. incorporated by reference to the
corresponding exhibit item to Form 8-K Current Report of
Shorewood Packaging Corporation filed with the Commission on
January 28, 1994, Commission File No. 0-15077.
10.79 -- Sheeter Purchase Agreement dated December 23, 1993 by and among
Shorewood Acquisition Corporation of Delaware and Paperboard
Industries Inc. incorporated by reference to the corresponding
exhibit item to Form 8-K Current Report of Shorewood Packaging
Corporation filed with the Commission on January 28, 1994,
Commission File No. 0-15077.
10.80 -- Restated and Amended Credit Agreement dated February 25, 1994
between Shorewood Packaging Corporation, Shorewood Corporation of
Canada Limited and NationsBank of North Carolina, N.A. and The
Bank of Nova Scotia incorporated by reference to the
corresponding exhibit item to Shorewood Packaging Corporation's
quarterly report on Form 10-Q for the fiscal quarter ended
January 29, 1994, as filed with the Commission on March 15, 1994,
Commission File No. 0-15077.
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10.81 -- Trademark License Agreement dated January 14, 1994 between
Paperboard Industries Inc. and Shorewood Acquisition Corporation
of Delaware incorporated by reference to the corresponding
exhibit item to the Company's annual report on Form 10-K for the
fiscal year ended April 30, 1994, as filed with the Commission on
July 29, 1994, Commission File No. O-15077.
10.82 -- Non-Competition Agreement dated January 14, 1994 between Cascades
Inc., Cascades Paperboard International Inc., Paperboard
Industries Corporation, Paperboard Industries Inc., Shorewood
Packaging Corporation, Shorewood Paperboard Corporation Limited
and Shorewood Acquisition Corporation of Delaware incorporated by
reference to the corresponding exhibit item to the Company's
annual report on Form 10-K for the fiscal year ended April 30,
1994, as filed with the Commission on July 29, 1994, Commission
File No. O-15077.
10.83 -- First Amendment to Restated and Amended Credit Agreement dated
July 18, 1994 between Shorewood Packaging Corporation, Shorewood
Corporation of Canada Limited and NationsBank of North Carolina,
N.A. and The Bank of Nova Scotia incorporated by reference to the
corresponding exhibit item to the Company's annual report on Form
10-K for the fiscal year ended April 30, 1994, as filed with the
Commission on July 29, 1994, Commission File No. O-15077.
10.84 -- Amendment, as of January 14, 1994, to Note Purchase Agreement
dated as of June 27, 1991 between Shorewood Packaging Corporation
and each of Connecticut General Life Insurance Company, Inc.,
Mezzanine Partners II, L.P., Life Insurance Company of North
America and The Prudential Insurance Company of America
incorporated by reference to the corresponding exhibit item to
the Company's annual report on Form 10-K for the fiscal year
ended April 30, 1994, as filed with the Commission on July 29,
1994, Commission File No. O-15077.
10.85 -- Asset Purchase Agreement dated January 17, 1994 between
Shorewood/Heminway Acquisition Corporation and Heminway Packaging
Corporation (omitting schedules and exhibits) incorporated by
reference to the corresponding exhibit item to the Company's
annual report on Form 10-K for the fiscal year ended April 30,
1994, as filed with the Commission on July 29, 1994, Commission
File No. O-15077.*
10.86 -- Lease dated as of January 17, 1994 between Shorewood/Heminway
Acquisition Corporation and Heminway Packaging Corporation in
respect of premises located at 155 South Leonard Street,
Waterbury, Connecticut incorporated by reference to the
corresponding exhibit item to the Company's annual report on Form
10-K for the fiscal year ended April 30, 1994, as filed with the
Commission on July 29, 1994, Commission File No. O-15077.
10.87 -- Letter Agreement dated April 21, 1994 by and among SPC
Corporation Limited, (formerly known as Shorewood Paperboard
Corporation Limited), Shorewood Acquisition Corporation of
Delaware, Paperboard Industries Corporation and Paperboard
Industries Inc. in respect of working capital adjustment
incorporated by reference to the corresponding exhibit item to
the Company's annual report on Form 10-K for the fiscal year
ended April 30, 1994, as filed with the Commission on July 29,
1994, Commission File No. O-15077.*
10.88 -- Employment Agreement dated as of May 16, 1994 between Shorewood
Packaging Corporation and Howard M. Liebman incorporated by
reference to the corresponding exhibit item to the Company's
annual report on Form 10-K for the fiscal year ended April 30,
1994, as filed with the Commission on July 29, 1994, Commission
File No. O-15077.
__________________________________
* Upon the request of the Commission the Registrant will furnish any omitted
schedules or exhibits.
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10.89 -- Consultation and Termination Agreement dated May 6, 1994 between
Shorewood Packaging Corporation and Murray B. Frischer
incorporated by reference to the corresponding exhibit item to
the Company's annual report on Form 10-K for the fiscal year
ended April 30, 1994, as filed with the Commission on July 29,
1994, Commission File No. O-15077.
10.90 -- Shorewood Packaging Corporation Retirement and Savings Plan, and
Adoption Agreement, dated March 19, 1994 between Shorewood
Packaging Corporation and its subsidiaries, as employer, and
NationsBank of Georgia, N.A., as trustee incorporated by
reference to the corresponding exhibit item to the Company's
annual report on Form 10-K for the fiscal year ended April 30,
1994, as filed with the Commission on July 29, 1994, Commission
File No. O-15077.
10.91 (a) Stock Warrant Agreement to purchase 100,000 shares of Common
Stock, dated as of January 13, 1994 incorporated by reference to
the corresponding exhibit item on Company's annual report on Form
10-K/A for the fiscal year ended April 30, 1994, as filed with
the Commission on April 20, 1995, Commission File No. 0-15077.
10.91 (b) Stock Warrant Agreement dated as of July 23, 1992 to purchase
300,000 shares of Common Stock incorporated by reference to the
corresponding exhibit item on Company's annual report on Form
10-K/A for the fiscal year ended April 30, 1994, as filed with
the Commission on April 20, 1995, Commission File No. 0-15077.
10.92 Second Amendment to Amended and Restated Credit Agreement dated
as of November 22, 1994, among Shorewood Packaging Corporation,
Shorewood Packaging Corporation of Canada Limited, NationsBank of
North Carolina, N.A. and The Bank of Nova Scotia.
10.93 Lease dated as of February 6, 1995, between Stanley Stahl, d/b/a
Stahl Park Avenue Co., and Shorewood Packaging Corporation
(omitting schedules and exhibits).*
21.1 -- Subsidiaries of Registrant.
23.1 -- Consent of Deloitte & Touche LLP.
(b) Reports on Form 8-K
No current reports on Form 8-K were filed by the Company during
the last quarter of the period covered by this report.
__________________________
* Upon the request of the Commission the Registrant will furnish any omitted
schedules or exhibits.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Company has duly caused this amended report to be signed on
its behalf by the undersigned, thereunto duly authorized.
SHOREWOOD PACKAGING CORPORATION
By: /s/ Howard M. Liebman
-------------------------------------------------
Howard M. Liebman
Executive Vice President and Chief Financial
Officer (Principal Financial Officer)
Date: August 10, 1995
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Item Description Page
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<S> <C> <C>
10.92 Second Amendment to Amended and Restated Credit 8
Agreement dated as of November 22, 1994, among
Shorewood Packaging Corporation, Shorewood
Packaging Corporation of Canada Limited, NationsBank 44
of North Carolina, N.A. and The Bank of Nova Scotia.
10.93 Lease dated as of February 6, 1995, between Stanley Stahl,
d/b/a Stahl Park Avenue Co., and Shorewood Packaging
Corporation (Omitting schedules and exhibits).*
</TABLE>
__________________________
* Upon the request of the Commission the Registrant will furnish any omitted
schedules and exhibits.
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EXHIBIT 10.92
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SECOND AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
This Second Amendment to Amended and Restated Credit Agreement (this
"Second Amendment") is entered into as of November 22, 1994 among SHOREWOOD
PACKAGING CORPORATION (the "U.S. Borrower") and SHOREWOOD PACKAGING CORPORATION
OF CANADA LIMITED (the "Canadian Borrower") (collectively, the U.S. Borrower
and the Canadian Borrower are referred to as the "Borrowers"), NATIONSBANK OF
NORTH CAROLINA, N.A. ("NationsBank"), as Administrative Agent, THE BANK OF NOVA
SCOTIA, as Canadian Administrative Agent and the Lenders party to the Credit
Agreement (as defined below). All capitalized terms used herein and not
otherwise defined shall have the meanings ascribed to such terms in the Credit
Agreement.
RECITALS
A. The Borrowers, the Administrative Agent, the Canadian
Administrative Agent and the Lenders entered into that certain Amended and
Restated Credit Agreement dated as of February 25, 1994 (as amended by that
certain First Amendment to Amended and Restated Credit Agreement dated as of
July 18, 1994; as the same may be further amended from time to time, the
"Credit Agreement").
B. The Borrowers, citing (i) the strong financial performance of the
Consolidated Shorewood Group and (ii) the future construction of a
manufacturing facility in Springfield, Oregon, have requested, and the Lenders
have agreed, to amend certain terms of the Credit Agreement as set forth below.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Definitions.
a. The following definitions in Section 1.01 of the Credit Agreement
are amended to read as follows:
"Applicable Acceptance Fee Rate" means
(a) if the Debt to Cash Flow Ratio is less than 1.5 to 1 then
.75%;
(b) if the Debt to Cash Flow Ratio is equal to or greater than
1.5 to 1 and less than 2.25 to 1 then .875%; and
(c) if the Debt to Cash Flow Ratio is equal to or greater than
2.25 to 1 then 1.125%.
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"Applicable LIBOR Rate Percentage" means
(a) if the Debt to Cash Flow Ratio is less than 1.5 to 1 then
.625%;
(b) if the Debt to Cash Flow Ratio is equal to or greater than
1.5 to 1 and less than 2.25 to 1 then .75%; and
(c) if the Debt to Cash Flow Ratio is equal to or greater than
2.25 to 1 then 1%.
"Capital Expenditures" means any current expenditure by the
Consolidated Shorewood Group for fixed or capital assets as
reflected on the financial statement of the Consolidated
Shorewood Group, as prepared in accordance with GAAP; provided,
however, that the expenditures incurred in (i) the Toronto
Facility Transaction and (ii) the acquiring, constructing and
equipping of a manufacturing facility in Springfield, Oregon (the
"Pacific Northwest Facility") in an amount not to exceed
$20,000,000, shall not, for the purposes of this Agreement, be
considered a Capital Expenditure.
"Commitments" means the U.S. Revolving Loan Commitment, the
Canadian Revolving Loan Commitment, the U.S. Term Loan
Commitment, the Canadian Term Loan Commitment and the Swing Line
Loan Commitment.
"Excess Cash Flow" means EBITDA minus (a) Interest Expense
actually paid by the Consolidated Shorewood Group minus (b) tax
expenses actually paid by the Consolidated Shorewood Group minus
(c) Capital Expenditures minus (d) any principal payments made by
the Consolidated Shorewood Group on their term indebtedness minus
(e) net positive changes in: Accounts Receivable and Inventory of
the Consolidated Shorewood Group less changes in accounts payable
and accrued expenses of the Consolidated Shorewood Group (as
calculated in accordance with GAAP) minus (f) the capital
expenditures incurred in the construction of the Pacific
Northwest Facility (as defined in the definition of Capital
Expenditures) up to an aggregate amount of $20,000,000, all as
calculated at the end of each fiscal year.
"Interest Payment Date" means (i) as to U.S. Base Rate Revolving
Loans, that portion of the U.S. Term Loan accruing interest at
the U.S. Base Rate and Swing Line Loans, the last day of each
month, (ii) as to Eurodollar Loans, the last day of each
applicable Interest Period; provided, that if the Interest Period
for a Eurodollar loan is greater than three months, then the
Interest Payment Date shall be quarterly and the last day of the
applicable interest Period and provided further that if an
Interest Payment Date falls on a date which is not a Business
Day, such Interest Payment Date shall be deemed to be the next
succeeding Business Day, except that in the case of an Interest
Period where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding Business
Day, and (iii) as to Canadian Base Rate Revolving Loans and that
portion of the Canadian Term Loan accruing interest at the
Canadian Prime Rate or the BNS U.S. Base Rate, the last day of
each month.
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"Loan Documents" means this Agreement, the Revolving Credit
Notes, the Swing Line Loan Note, the Term Notes, the Guaranty
Agreements, the Stock Pledge Agreements, the Letter of Credit
Documents, the BA Documents and all other documents and
instruments executed or delivered in connection herewith.
"Notes" means the Revolving Credit Notes, the Swing Line Loan
Note and the Term Notes.
"Revolving Loan Commitments" means the U.S. Revolving Loan
Commitment, the Canadian Revolving Loan Commitment and the Swing
Line Loan Commitment.
"Revolving Loans" means the loans made pursuant to Section 2
hereof, which may be U.S. Revolving Loans, Canadian Revolving
Loans and Swing Line Loans.
"U.S. Base Rate Revolving Loans" means the Revolving Loans (other
than Swing Line Loans) made by the U.S. Lenders accruing interest
at the U.S. Base Rate.
"U.S. Unused Revolving Commitment" means, for any period, the
amount by which (i) the then applicable U.S. Revolving Loan
Commitment exceeds (ii) the daily average sum for such period of
the outstanding aggregate principal amount of all U.S. Revolving
Loans less the daily average sum for such period of the
outstanding aggregate principal amount of all Swing Line Loans.
b. The following definitions are hereby added to Section 1.01 of the
Credit Agreement and shall read as follows:
"Applicable Commitment Fee" means
(a) if the Debt to Cash Flow Ratio is less than 1.5 to 1 then
.25%;
(b) if the Debt to Cash Flow Ratio is equal to or greater than
1.5 to 1 and less than 2.25 to 1 then .30%; and
(c) if the Debt to Cash Flow Ratio is equal to or greater than
2.25 to 1 then .375%.
"NationsBank" means NationsBank of North Carolina, N.A.
"Swing Line Loan Commitment" means $2,000,000 (U.S.), as such
amount may be reduced in accordance with Section 2.10 of this
Agreement.
"Swing Line Loans" means the revolving loans made by NationsBank
to the U.S. Borrower pursuant to Section 2.10 of this Agreement.
"Swing Line Loan Note" means the promissory note of the U.S.
Borrower in favor of NationsBank evidencing the Swing Line Loans
and substantially in the form of
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Exhibit 2.08(a) hereto as such promissory note may be amended,
modified, supplemented, or replaced from time to time.
2. The U.S. Revolving Loans. Subsections (i), (ii) and (iii) of Section
2.01 of the Credit Agreement are amended in their entirety to read as
follows:
(i) the aggregate amount of U.S. Revolving Loans outstanding plus
Letter of Credit Obligations outstanding plus Swing Line Loans
outstanding at any one time may not exceed the U.S. Revolving
Loan Commitment; (ii) the aggregate amount of U.S. Revolving
Loans outstanding plus Canadian Revolving Loans outstanding plus
Letter of Credit Obligations outstanding plus BA Revolving
Obligations outstanding plus Swing Line Loans outstanding may not
exceed the lesser of (A) the Borrowing Base and (B) $50,000,000
(U.S.); and (iii) with regard to each individual U.S. Lender
(other than NationsBank with respect to Swing Line Loans), the
U.S. Lender's pro rata share of outstanding U.S. Revolving Loans
plus Letter of Credit obligations outstanding (plus, if
applicable, such U.S. Lenders pro rata share of the Swing Line
Loans) shall not exceed such U.S. Lender's U.S. Revolving Loan
Commitment Percentage of the U.S. Revolving Loan Commitment.
3. Letter of Credit Subfacility. Subsection (ii) of Section 2.01A of the
Credit Agreement is amended in its entirety to read as follows:
(ii) the sum of U.S. Revolving Loans outstanding plus Canadian
Revolving Loans outstanding plus Letter of Credit Obligations
outstanding plus BA Revolving obligations outstanding plus Swing
Loans outstanding shall not at any time exceed the lesser of (A)
$50,000,000 (U.S.) or (B) the Borrowing Base,
4. The Canadian Revolving Loans. Subsection (ii) of Section 2.02 of the
Credit Agreement is amended in its entirety to read as follows:
(ii) the aggregate amount of U.S. Revolving Loans outstanding
plus Canadian Revolving Loans outstanding plus Letter of Credit
obligations outstanding plus BA Revolving Obligations outstanding
plus Swing Line Loans outstanding may not exceed the lesser of
(A) the Borrowing Base and (B) $50,000,000 (U.S.);
5. Swing Line Loan Borrowings. A new Section 2.03C is added to the
Credit Agreement to read as follows:
2.03C Method of Borrowing for Swing Line Loans. By no later than
10:00 a.m., Charlotte, North Carolina time, on the date of the
request, the U.S. Borrower shall submit an Advance Request to
NationsBank setting forth the amount of the requested Swing Line
Loan and complying in all respects with Section 5 hereof.
6. Minimum Amounts. (a) The last sentence of Section 2.04 of the Credit
Agreement is amended in its entirety to read as follows:
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Any Revolving Loan (other than Swing Line Loans) requested shall be in
an integral multiple of $1,000,000 unless the request is for all of
the remaining amount available to be borrowed.
(b) The following sentence is hereby added at the end of Section 2.04
of the Credit Agreement and shall read as follows:
Each Swing Line Loan shall be in an aggregate principal amount
that is not less than $100,000 and if greater, shall be in an
integral multiple of $25,000 above such minimum.
7. Interest Rate. The following sentence is hereby added to the
beginning of Section 2.07(a) of the Credit Agreement and shall read as
follows:
All swing Line Loans shall accrue interest at the U.S. Base Rate.
8. Interest Payments. Section 2.07(b) of the Credit Agreement is amended
in its entirety to read as follows:
(b) Interest Payments. Interest on Revolving Loans shall be due
and payable in arrears on each Interest Payment Date; provided
that interest on Swing Line Loans shall also be due and payable
on demand.
9. Revolving Notes.
a. The words "(other than the Swing Line Loans)" shall be inserted
following the words "Revolving Loans" in the first sentence of
Section 2.08 of the Credit Agreement.
b. The following sentence is added at the end of Section 2.08 of the
Credit Agreement to read as follows:
The Swing Line Loans by NationsBank shall be evidenced by a duly
executed promissory note of the U.S. Borrower, dated as of the
date hereof, in an original principal amount equal to the Swing
Line Loan Commitment, and substantially in the form of Exhibit
2.08(a) attached hereto.
10. Reduction of Revolving Loan Commitments. Subsection (ii)(B) of
Section 2.09 of the Credit Agreement is amended in its entirety to
read as follows:
(B) no reduction shall be made which would reduce the U.S.
Revolving Loan Commitment to an amount less than the sum of U.S.
Revolving Loans then outstanding plus Letter of Credit
Obligations then outstanding plus Swing Line Loans then
outstanding.
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11. Swing Line Loans. A new Section 2.10 is hereby added to the Credit
Agreement and shall read an follows:
2.10 Swing Line Loans
(a) NationsBank hereby agrees, on the terms and subject to the
conditions set forth herein and in reliance upon the
representations and warranties set forth herein and in the other
Loan Documents, to make revolving loans to the U.S. Borrower
from time to time from the date hereof to the Revolving Loans
Maturity Date in such aggregate amount as the U.S. Borrower may
request (each such loan, a "Swing Line Loan" and collectively,
the Swing Line Loans"); provided that (i) the aggregate principal
amount of the Swing Line Loans outstanding at any one time shall
not exceed the Swing Line Loan Commitment, (ii) the sum of the
aggregate principal amount of Swing Line Loans outstanding plus
the aggregate principal amount of U.S. Revolving Loans
outstanding plus Letter of Credit Obligations outstanding at any
one time may not exceed the U.S. Revolving Loan Commitment and
(iii) the Swing Line Loan Commitment may be reduced or terminated
by NationsBank, in its sole discretion, upon two Business Days'
notice to the U.S. Borrower. Prior to the Revolving Loans
Maturity Date, Swing Line Loans may be repaid and reborrowed by
the U.S. Borrower in accordance with the provisions hereof. Upon
the request of any U.S. Lender, NationsBank shall provide such
U.S. Lender a schedule of Swing Line Loans then outstanding.
(b) Additional Swing Line Loan Provisions. The U.S. Borrower
agrees to repay all Swing Line Loans then outstanding within one
Business Day of demand therefor by NationsBank, which may be
accomplished by requesting a U.S. Revolving Loan. In the event
that the U.S. Borrower shall fail to repay any Swing Line Loan
within three Business Days after demand therefor by NationsBank,
and in any event upon (i) a request by NationsBank, (ii) the
occurrence of an Event of Default described in Section 9.01(f) or
(iii) the acceleration of any Loan or termination of any
Commitment pursuant to Section 9.01, each other U.S. Lender shall
irrevocably and unconditionally purchase from NationsBank,
without recourse or warranty, an undivided interest and
participation In such Swing Line Loan in an amount equal to such
other U.S. Lender's U.S. Revolving Loan Commitment Percentage
thereof, by directly purchasing a participation in such Swing
Line Loan in such amount (regardless of whether the conditions
precedent thereto set forth in section 5.02 hereof are then
satisfied, whether or not the U.S. Borrower has made an Advance
Request and whether or not the Revolving Loan Commitments are
then in effect, any Event of Default exists or all the Loans have
been accelerated) and paying the proceeds thereof to NationsBank
at the address provided in Section 11.0l, or at such other
address as NationsBank may designate, in lawful money of the
United States of America and in immediately available funds.
NationsBank agrees to notify each U.S. Lender that is obligated
to purchase a participation in Swing Line Loans hereunder of the
occurrence of any event described in clause (ii) or (iii) above
promptly after NationsBank becomes aware thereof, but the failure
to give such notice will not affect the obligation of any such
U.S. Lender to purchase any such
6
<PAGE> 8
participation. If such amount is not in fact made available to
NationsBank by any U.S. Lender, NationsBank shall be entitled to
recover such amount on demand from such U.S. Lender, together with
accrued interest thereon for each day from the date of demand
thereof, at the Federal Funds Rate. If such U.S. Lender does not
pay such amount forthwith upon NationsBank's demand therefor, and
until such time as such U.S. Lender makes the required payment,
NationsBank shall be deemed to continue to have outstanding Swing
Line Loans in the amount of such unpaid participation obligation
for all purposes of the Loan Documents other than those provisions
requiring the other U.S. Lenders to purchase a participation
therein. Further, such U.S. Lender shall be deemed to have
assigned any and all payments made of principal and interest on
its Loans, amounts due with respect to its Letters of Credit (or
its participation therein) and any other amounts due to it
hereunder to NationsBank to fund Saving Line Loans in the amount
of the participation in Swing Line Loans that such U.S. Lender
failed to purchase pursuant to this Section 2.10(b) until such
amount has been purchased (as a result of such assignment or
otherwise). Upon the purchase of a Participation in respect of
such Swing Line Loan by a U.S. Lender pursuant to this Section
2.10(b), the amount so funded shall become a U.S. Revolving Loan
by the purchasing U.S. Lender hereunder and shall no Longer be a
Swing Line Loan. On the date that the U.S. Lenders are required
to purchase participation in Swing Line Loans under this Section
2.10(b), NationsBank's pro rata share of such Swing Line Loans
shall no longer be a Swing Line Loan hereunder but shall be a U.S.
Revolving Loan.
12. Issuance of Bankers' Acceptances. Subsection (a)(ii) of Section 3A.01
of the Credit Agreement is hereby amended in its entirety to read as
follows:
(ii) the sum of U.S. Revolving Loans outstanding plus Canadian
Revolving Loans outstanding plus Letter of Credit Obligations
outstanding plus BA Revolving Obligations outstanding plus Swing
Line Loans outstanding shall not at any time exceed the lesser of
(A) $50,000,000 (U.S.) or (B) the Borrowing Base.
13. Commitment Fee. The first sentence of Section 4.05(b) of the Credit
Agreement is amended in its entirety to read as follows:
(b) Commitment Fee. In consideration of the Revolving
Commitments being made available by the Lenders hereunder, the
Borrowers agree to pay (i) to the Administrative Agent, for the
account of the U.S. Lenders, a fee equal to the Applicable
commitment Fee per annum (calculated on the basis of the actual
number of days elapsed in a 360 day year) on the U.S. Unused
Revolving Commitment and (ii) to the Canadian Administrative
Agent, for the account of the Canadian Lenders, a fee equal to
the Applicable Commitment Fee per annum (calculated on the basis
of the actual number of days elapsed in a 360 day year) on the
Canadian Unused Revolving Commitment (collectively, the
"Commitment Fees").
7
<PAGE> 9
14. Voluntary Prepayments.
a. Section 4.06(a)(iii) of the Credit Agreement is amended in its
entirety to read as follows:
(iii) each such partial prepayment of Loans (other than Swing
Line Loans) shall be in the minimum principal amount of
$1,000,000.
b. A new Section 4.06(a)(iv) in hereby added to the Credit Agreement
to read as follows:
; and (iv) any partial prepayment of Swing Line Loans shall be in
a minimum aggregate principal amount of $25,000.
15. Mandatory Prepayments. The first sentence of Section 4.06(b)(i) of
the Credit Agreement in hereby amended in its entirety to read as
follows:
(i) Revolving Loan Overadvance. If, at any time (A) the sum of
U.S. Revolving Loans outstanding plus Canadian Revolving Loans
outstanding plus Letter of Credit Obligations outstanding plus BA
Revolving Obligations outstanding plus Swing Line Loans
outstanding exceeds the lesser of (1) 50,000,000 (U.S.) or (2)
the Borrowing Base (as last reported by the Borrowers); (B) the
U.S. Revolving Loans outstanding plus the Letter of Credit
Obligations outstanding plus the Swing Line Loans outstanding
exceed the U.S. Revolving Loan Commitment; (C) the Canadian
Revolving Loans outstanding plus BA Revolving Obligations
outstanding exceed the Canadian Revolving Loan Commitment; or (D)
the Swing Line Loans outstanding exceed the Swing Line Loan
Commitment, then the Borrowers (or the applicable Borrower) shall
immediately make a payment in an amount equal to the deficiency.
16. Incurrences of Debt/Sales of Equity. Section 4.06 (b)(iii) of the
Credit Agreement is amended in its entirety to read as follows:
(iii) Incurrences of Debt. Immediately upon receipt by any
member of the Consolidated Shorewood Group of proceeds from any
incurrence of debt for money borrowed or sale of equity
securities for cash (except any stock options or stock granted or
issued to any employee of the Consolidated Shorewood Group
pursuant to any stock or stock option plans or any exchange of
stock for assets as allowed under this Agreement), the Borrowers
shall prepay the Borrowers Obligations in an amount equal to the
Net Proceeds of such issuance or sale; provided, however, (A)
that the Borrowers shall not be required to prepay the Borrowers
Obligations with respect to (I) the $15,000,000 of purchase money
debt allowed under this Agreement and (II) the first $5,000,000
(net of expenses) received, in the aggregate, by the Consolidated
Shorewood Group from the incurrence of unsecured debt during the
term of this Agreement and (B) that only the first $20,000,000
received by the Borrowers from the sale of equity securities
shall be required to be used to prepay the Borrowers Obligations.
Any amount prepaid under this subsection (iii) shall be
8
<PAGE> 10
applied first to the U.S. Term Loan and the Canadian Term Loan
(first to accrued interest and then to remaining payments on a pro
rata basis) on a pro rata basis and then to the U.S. Revolving
Loans and Canadian Revolving Loans on a pro rata basis (first to
Base Rate Revolving Loans and then to Eurodollar Revolving Loans
and BA Revolving Obligations in direct order of maturities) and
then to Swing Line Loans. Prepayments on the Revolving Loans in
accordance with this subsection shall immediately and permanently
reduce the applicable Revolving Loan Commitment in an amount equal
to such prepayment.
17. Application of Certain Prepayments. The first sentence of Section
4.06(b)(v) of the Credit Agreement is amended in its entirety to read
as follows:
(v) Application of Certain Prepayments. All amounts required to
prepay Borrowers Obligations pursuant to Section 4.06(b)(ii) or
(iv) above shall be applied first to the U.S. Term Loan and the
Canadian Term Loan (first to accrued interest and then to
remaining payments in the inverse order of maturity) on a pro
rata basis and then to U.S. Revolving Loans and Canadian
Revolving Loans on a pro rata basis (first to Base Rate Revolving
Loans and then to Eurodollar Revolving Loans and BA Revolving
Obligations in direct order of maturities) and then to Swing Line
Loans.
18. Place and Manner of Payments. The second sentence of Section 4.07 is
amended in its entirety to read as follows:
All other payments of principal, interest, fees, expenses and
other amounts to be made by the Borrowers under this Agreement
(including, but not limited to, the U.S. Revolving Loans, the
U.S. Term Loan and the Swing Line Loans) shall be received not
later than 2:00 p.m., Charlotte, North Carolina time, on the date
when due in U.S. Dollars and in immediately available funds, by
the Administrative Agent (or in the case of Swing Line Loans, by
NationsBank) at its offices at NationsBank Corporate Center,
Charlotte, North Carolina.
19. Pro Rata Treatment. Section 4.08 is hereby amended in its entirety
and shall read as follows:
4.08 Pro Rata Treatment. Except to the extent otherwise
provided herein each Revolving Loan (other than Swing Line
Loans), the Term Loans, each payment or prepayment of principal
of any Revolving Loan (other than Swing Line Loans), each payment
or prepayment of principal of the Term Loans, each payment of
interest on the Loans (other than the Swing Line Loans), each
payment of Commitment Fees and Letter of Credit Fees, each
reduction of the Revolving Loan Commitments (other than the Swing
Line Loan Commitment), and each conversion or continuation of any
Loan (other than the Swing Line Loans), shall be allocated pro
rata among the relevant Lenders in accordance with the respective
U.S. Revolving Loan Commitment Percentages, Canadian Revolving
Loan Commitment Percentages, U.S. Term Loan Commitment
Percentages or Canadian Term Loan Commitment Percentages, as
applicable, of such Lenders; it being understood that payments
9
<PAGE> 11
under the U.S. Revolving Loans shall be allocated pro rata among
the U.S. Lenders, payments under the Canadian Revolving Loans
shall be allocated pro rata among the Canadian Lenders, etc.
Notwithstanding anything above to the contrary, all U.S. Lenders
(other than NationsBank) shall receive their Commitment Fees with
respect to the U.S. Unused Revolving Commitment as if no Swing
Line Loans were outstanding during the period for calculation of
such Commitment Fee, and NationsBank shall receive a reduced
Commitment Fee with respect to the U.S. Unused Revolving
Commitment resulting from Swing Line Loans outstanding during such
period.
20. Conditions to Revolving Loans. Section 5.02(b) of the Credit
Agreement is hereby amended in its entirety to read as follows:
(b) No Default. On the date of the funding of a Revolving Loan,
no Default or Event of Default exists or would be caused by the
making of such Revolving Loan, including any advancement of funds
in excess of the amounts allowed pursuant to Sections 2.01, 2.02
and 2.10.
21. Interest Rate Protection Agreements. Section 7.14 of the Credit
Agreement is hereby deleted in its entirety.
22. Capital Expenditures. Section 8.09 of the Credit Agreement is amended
in its entirety to read as follows:
8.09 Capital Expenditures. The Consolidated Shorewood Group will
not make Capital Expenditures in excess of $15,000,000 during any
fiscal year; provided, however, that the Consolidated Shorewood
Group may make additional Capital Expenditures for any fiscal
year in an amount up to 50% of the Excess Cash Flow earned by the
Consolidated Shorewood Group subsequent to the fiscal year ending
in 1995 less any amounts from such Excess Cash Flow used to make
Investments or pay dividends as set forth in Sections 8.08 and
8.10.
23. Exhibits.
a. Exhibit 2.03 to the Credit Agreement is amended in its entirety
to read as attached hereto as Exhibit A.
b. A new Exhibit 2.08(a) is added to the Credit Agreement to read
as attached hereto as Exhibit B.
24. Conditions Precedent. The Agents and the Lenders shall not be
required to enter into this Second Amendment and this Second Amendment
shall not be effective until the following conditions have been
satisfied:
(a) Upfront Fees. Receipt by each of the Lenders of an upfront
fee equal to .05% of each Lender's pro rata share of the
Commitments;
10
<PAGE> 12
(b) Swing Line Loan Note. Receipt by NationsBank of a duly
executed Swing Line Loan Note satisfactory in form and
substance to NationsBank; and
(c) Other. Receipt by the Administrative Agent of such other
documents it deems reasonably necessary, including, but not
limited to, certified resolutions of the Borrowers.
25. Representations and Warranties. Borrowers hereby represent and
warrant to the Agents and the Lenders that (a) no Default or Event of
Default exists under the Credit Agreement or any of the other Loan
Documents; (b) all of the provisions of the Loan Documents, except as
amended hereby, are in full force and effect; (c) the liens created
and evidenced by the Loan Documents (including, without limitation,
the Stock Pledge Agreements) are valid and existing liens of the
recited priority; and (d) since the date of the last financial
statements of Borrowers delivered to Lenders, no material adverse
change has occurred in the business, financial or other conditions of
Borrowers.
26. Acknowledgement of Subsidiary Guarantors. The Subsidiary Guarantors
acknowledge and consent to all of the terms and conditions of this
Second Amendment and agree that this Second Amendment and all
documents executed in connection herewith do not operate to reduce or
discharge the Subsidiary Guarantors' obligations under the Agreement.
27. Effect of Amendment. Except as expressly modified and amended in this
Second Amendment, all of the terms, provisions and conditions of the
Credit Agreement are and shall remain in full force and effect and are
incorporated herein by reference. The credit Agreement and any and
all other documents heretofore, now or hereafter executed and
delivered pursuant to the terms of the Credit Agreement are hereby
amended so that any reference to the Credit Agreement shall mean a
reference to the Credit Agreement as amended hereby.
28. Counterparts. This Second Amendment may be executed in any number of
counterparts, all of which taken together shall constitute one and the
same instrument.
29. ENTIRETY. THIS SECOND AMENDMENT AND THE OTHER LOAN DOCUMENTS EMBODY
THE ENTIRE AGREEMENT BETWEEN THE PARTIES AND SUPERSEDE ALL PRIOR
AGREEMENTS AND UNDERSTANDINGS, IF ANY, RELATING TO THE SUBJECT MATTER
HEREOF. THESE LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE
ARE NO ORAL AGREEMENTS BETWEEN THE PARTIES.
11
<PAGE> 13
The parties below have executed this Second Amendment as of the day
and year first above written.
BORROWERS:
SHOREWOOD PACKAGING CORPORATION
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SHOREWOOD CORPORATION OF CANADA, LIMITED
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
--------------------------------------
Title: Vice President
-------------------------------------
LENDERS:
NATIONSBANK OF NORTH CAROLINA, a N.A.,
in its capacity as Administrative Agent
and as a Lender
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE BANK OF NOVA SCOTIA, in its capacity as
Canadian Administrative Agent and as a
Lender
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE FIRST NATIONAL BANK OF BOSTON
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[signatures continued]
<PAGE> 14
The parties below have executed this Second Amendment as of the day
and year first above written.
BORROWERS:
SHOREWOOD PACKAGING CORPORATION
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
SHOREWOOD CORPORATION OF CANADA, LIMITED
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
LENDERS:
NATIONSBANK OF NORTH CAROLINA, a
N.A., in its capacity as Administrative
Agent and as a Lender
By:/s/ Michael J. Cerminaro
-----------------------------------------
Name: Michael J. Cerminaro
-------------------------------------
Title: Senior Vice President
-------------------------------------
THE BANK OF NOVA SCOTIA, in its capacity as
Canadian Administrative Agent and as a
Lender
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE FIRST NATIONAL BANK OF BOSTON
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[signatures continued]
<PAGE> 15
The parties below have executed this Second Amendment as of the day
and year first above written.
BORROWERS:
SHOREWOOD PACKAGING CORPORATION
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
SHOREWOOD CORPORATION OF CANADA, LIMITED
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
LENDERS:
NATIONSBANK OF NORTH CAROLINA, a
N.A., in its capacity as Administrative
Agent and as a Lender
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE BANK OF NOVA SCOTIA, in its capacity as
Canadian Administrative Agent and
as a Lender
By:/s/ J. Alan Edwards
-----------------------------------------
Name: J. Alan Edwards
-------------------------------------
Title: Authorized Signatory
-------------------------------------
THE FIRST NATIONAL BANK OF BOSTON
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[signatures continued]
<PAGE> 16
The parties below have executed this Second Amendment as of the day
and year first above written.
BORROWERS:
SHOREWOOD PACKAGING CORPORATION
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
SHOREWOOD CORPORATION OF CANADA, LIMITED
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
LENDERS:
NATIONSBANK OF NORTH CAROLINA, a
N.A., in its capacity as Administrative
Agent and as a Lender
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE BANK OF NOVA SCOTIA, in its capacity as
Canadian Administrative Agent and as a
Lender
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE FIRST NATIONAL BANK OF BOSTON
By:/s/ Sarah C. Lincoln
-----------------------------------------
Name: Sarah C. Lincoln
-------------------------------------
Title: Vice President
-------------------------------------
[signatures continued]
<PAGE> 17
CREDITANSTALT-BANKVEREIN
By: /s/ G.D. Spillane By: /s/ Gregory F. Mathis
--------------------- ---------------------------------------
Name: G.D. Spillane Name: Gregory F. Mathis
------------------- ------------------------------------
Title: Senior Assoc. Title: Vice President
------------------- ------------------------------------
CRESTAR BANK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
NATIONAL CITY BANK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE CHASE MANHATTAN BANK, N.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
BANQUE PARIBAS
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[signatures continued]
<PAGE> 18
CREDITANSTALT-BANKVEREIN
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
CRESTAR BANK
By:/s/ Edwin D. Brooks, Jr.
-----------------------------------------
Name: Edwin D. Brooks, Jr.
-------------------------------------
Title: Executive Vice President
-------------------------------------
NATIONAL CITY BANK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE CHASE MANHATTAN BANK, N.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
BANQUE PARIBAS
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[signatures continued]
<PAGE> 19
CREDITANSTALT-BANKVEREIN
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
CRESTAR BANK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
NATIONAL CITY BANK
By:/s/ David A. Burns
-----------------------------------------
Name: David A. Burns
-------------------------------------
Title: Assistant Vice President
-------------------------------------
THE CHASE MANHATTAN BANK, N.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
BANQUE PARIBAS
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[signatures continued]
<PAGE> 20
CREDITANSTALT-BANKVEREIN
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
CRESTAR BANK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
NATIONAL CITY BANK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE CHASE MANHATTAN BANK, N.A.
By:/s/ The Chase Manhattan Bank
-----------------------------------------
Name: Emela K. Telge
-------------------------------------
Title: Vice President
-------------------------------------
BANQUE PARIBAS
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[signatures continued]
<PAGE> 21
CREDITANSTALT-BANKVEREIN
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
CRESTAR BANK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
NATIONAL CITY BANK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE CHASE MANHATTAN BANK, N.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
BANQUE PARIBAS
By:/s/ Richard G. Burrows
-----------------------------------------
Name: Richard G. Burrows
-------------------------------------
Title: Vice President
-------------------------------------
By:/s/ Ann Pifer
-----------------------------------------
Name: Ann Pifer
--------------------------------------
Title: Assistant Vice President
-------------------------------------
[signatures continued]
<PAGE> 22
THE DAIWA BANK, LIMITED
By:/s/ Ronald W. Gale
-----------------------------------------
Name: Ronald W. Gale
-------------------------------------
Title: Vice-President
-------------------------------------
By:/s/ James H. Bradley
-----------------------------------------
Name: James H. Bradley
-------------------------------------
Title: Vice-President
-------------------------------------
NATIONAL WESTMINISTER BANK, U.S.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
SHAWMUT BANK CONNECTICUT, N.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE BANK OF NEW YORK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
FIRST UNION NATIONAL BANK OF NORTH CAROLINA
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
<PAGE> 23
THE DAIWA BANK, LIMITED
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
NATIONAL WESTMINISTER BANK, U.S.A.
By:/s/ Michael Merlo
-----------------------------------------
Name: Michael Merlo
-------------------------------------
Title: Vice President
-------------------------------------
SHAWMUT BANK CONNECTICUT, N.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE BANK OF NEW YORK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
FIRST UNION NATIONAL BANK OF NORTH CAROLINA
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
<PAGE> 24
THE DAIWA BANK, LIMITED
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
NATIONAL WESTMINISTER BANK, U.S.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
SHAWMUT BANK CONNECTICUT, N.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE BANK OF NEW YORK
By:/s/ Russell A. Burr
-----------------------------------------
Name: Russell A. Burr
-------------------------------------
Title: Senior Vice President
-------------------------------------
FIRST UNION NATIONAL BANK OF NORTH CAROLINA
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
<PAGE> 25
THE DAIWA BANK, LIMITED
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
NATIONAL WESTMINISTER BANK, U.S.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
SHAWMUT BANK CONNECTICUT, N.A.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
THE BANK OF NEW YORK
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
FIRST UNION NATIONAL BANK OF NORTH CAROLINA
By:/s/ Allison C. Zollicoffer
-----------------------------------------
Name: Allison C. Zollicoffer
-------------------------------------
Title: Vice President
-------------------------------------
<PAGE> 26
SUBSIDIARY GUARANTORS:
SHOREWOOD TECHNOLOGIES, INC.
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Vice President
-------------------------------------
SHOREWOOD PACKAGING CORPORATION OF GEORGIA
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SHOREWOOD PACKAGING OF NORTH CAROLINA, INC.
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SPC COMPANY OF VIRGINIA, INC.
(f/k/a SHOREWOOD PACKAGING OF
VIRGINIA, INC.)
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SHOREWOOD PACKAGING OF CALIFORNIA, INC.
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
[signatures continued]
<PAGE> 27
SHOREWOOD PACKAGING COMPANY OF
ILLINOIS, INC.
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SHOREWOOD TRANSPORT, INC.
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SHOREWOOD PACKAGING OF DELAWARE, INC.
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Vice President
-------------------------------------
SHOR-WRAP, INC.
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SHOREWOOD PACKAGING CORPORATION OF ALABAMA
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SHOREWOOD PACKAGING CORPORATION OF NEW YORK
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
[signatures continued]
<PAGE> 28
SHOREWOOD ACQUISITION CORP. OF DELAWARE
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SHOREWOOD PACKAGING OF VIRGINIA
(f/k/a SHOREWOOD PAPERBOARD
CORPORATION OF VIRGINIA)
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SPC COMPANY OF NEW YORK, INC.
(f/k/a SHOREWOOD PAPERBOARD
CORPORATION OF NEW YORK)
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
SHOREWOOD PACKAGING CORPORATION
OF CONNECTICUT (f/k/a
SHOREWOOD/HEMINWAY SET-UP BOX
CORPORATION)
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Executive Vice President
-------------------------------------
TORONTO CARTON CORPORATION LIMITED
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Vice President
-------------------------------------
[signatures continued]
<PAGE> 29
SPC CORPORATION LIMITED (f/k/a SHOREWOOD
PAPERBOARD CORPORATION LIMITED)
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Vice President
-------------------------------------
SHOREWOOD PACKAGING CORP. OF CANADA LIMITED
By:/s/ Howard M. Liebman
-----------------------------------------
Name: Howard M. Liebman
-------------------------------------
Title: Vice President
-------------------------------------
<PAGE> 30
Exhibit A to
second Amendment to
Credit Agreement
EXHIBIT 2.03
ADVANCE REQUEST
TO: ________NationsBank of North Carolina, N.A.; or
________NationsBank of North Carolina, N.A.,
as Administrative Agent; or
________The Bank of Nova Scotia, as Canadian Administrative Agent
RE:________Amended and Restated credit Agreement dated as of February 25, 1994
among Shorewood PackagingCorporation, Shorewood Corporation of Canada Limited,
the Lenders party thereto, NationsBank of North Carolina N.A., as
Administrative Agent and The Bank of Nova Scotia as Canadian Administrative
Agent (as amended by that certain First Amendment to Amended and Restated
Credit Agreement dated as of July 18, 1994, as amended by that certain Second
Amendment to Amended and Restated Credit Agreement dated as of
________________, 1994, and as further amended or modified from time to time,
the "Agreement").
DATE: _________________, 199__
- -------------------------------------------------------------------------------
1. This Advance Request is made pursuant to the terms of the Agreement. All
capitalized terms used herein unless otherwise defined shall have the meanings
set forth in the Agreement.
2. _________ Please be advised that:
(a)___________ the U.S. Borrower is requesting a U.S. Revolving Loan in the
amount of $________________ be funded on _____________________________, 199__
to accrue interest at the interest rate set forth below in paragraph 4.
Subsequent to the funding of the requested U.S. Revolving Loan, the aggregate
amount of outstanding U.S. Revolving Loans will be $____________; or
(b)________ the U.S. Borrower is requesting that on ____________________, 199__
a portion of the current outstanding U.S. Revolving Loans in the amount of
$_____________ that is currently accruing interest at the ________________
be extended or converted to the interest rate option set Forth below in
paragraph 4.
1<PAGE> 31
(c)_________ Please be advised that the U.S. Borrower is requesting a Swing
Line Loan in the amount of $______________ be funded on _____________, 199__ to
accrue interest at the U.S. Base Rate. Subsequent to the funding of the
requested Swing Line Loan, the aggregate amount of outstanding Swing Line Loans
will be $___________________.
3. _______________ Please be advised that:
(a) _________ the U.S. Borrower is requesting a Canadian Revolving Loan
in the amount of $ __________________ be funded on ______________ 199_ to
accrue interest at the interest rate set forth below in paragraph 5.
Subsequent to the funding of the requested Canadian Revolving Loan, the
aggregate amount of outstanding Canadian Revolving Loans will be
$______________; or
(b) _______________ the U.S. Borrower is requesting that on
________________, 199__ a portion of the current outstanding
Canadian Revolving Loans in the amount of $_______________________
that is currently accruing interest at the _____________________ be
extended or converted to the interest rate option set forth below in
paragraph 5; or
(c) ________________ the Canadian Borrower is requesting a Canadian
Revolving Loan in the amount of $__________________ be funded on
__________________, 199__ to accrue interest at the Canadian Prime
Rate. Subsequent to the funding of the requested Canadian Revolving
Loan, the aggregate amount of outstanding Canadian Revolving Loans
will be $_________________; or
(d) _______________ the Canadian Borrower is requesting the Canadian
Lenders to create Bankers' Acceptances in the amount of
$______________ on __________________, 199___ for the period set
forth below in paragraph 6; or
(e) ____________ the Canadian Borrower is requesting that Bankers'
Acceptances in the amount of $_____________ maturing on
_________________, 199___ be converted into a Canadian Base Rate
Revolving Loans accruing interest at the Canadian Prime Rate on the
maturity date; or
(f) __________ the Canadian Borrower is requesting that a portion of the
current outstanding Canadian Base Rate Revolving Loan in the amount
of $________________ be converted into a Bankers' Acceptance for the
period set forth below in paragraph 6.
4. The interest rate option applicable to the requested U.S. Revolving Loan
(or the extension or conversion of all or part of the existing U.S.
Revolving Loans) set forth in paragraph 2 above shall be:
a. ______________ the U.S. Base Rate; or
b. ______________ the Adjusted Eurodollar Rate for an Interest Period of:
2
<PAGE> 32
____________ one month;
____________ two months;
____________ three months; or
____________ six months.
5. The interest rate option applicable to the requested Canadian Revolving
Loan by the U.S. Borrower (or the extension or conversion of all or part
of the existing Canadian Revolving Loans to the U.S. Borrower) as set
forth in paragraph 3(a) and (b) above shall be:
a. ____________ BNS U.S. Prime Rate; or
b. ___________ the Adjusted Eurodollar Rate for an Interest Period
of:
____________ one month;
____________ two months;
____________ three months; or
____________ six months.
6. The period of the Bankers' Acceptance requested by the Canadian Borrower
pursuant to paragraph 3(d) and (f) above under the Canadian Revolving
Loan Commitment shall be:
a. ____________ 30 days;
b. ____________ 60 days;
c. ____________ 90 days; or
d. ____________ 180 days.
7. The representations and warranties made in the Agreement are true and
correct in all material respects as if made on the date hereof.
8. As of the date hereof, no Default or Event of Default has occurred and is
continuing or would be caused by the requested Revolving Loan or Bankers'
Acceptance.
______________________________
By:
---------------------------
Name:
-------------------------
Title:
------------------------
3
<PAGE> 33
To Revolving Credit and
Term Loan Agreement
Exhibit B to
second Amendment to
Credit Agreement
EXHIBIT 2.08(a)
SWING LINE
PROMISSORY NOTE
$2,000,000 ___________________, 1994
Charlotte, North Carolina
FOR VALUE RECEIVED, Shorewood Packaging Corporation, a Delaware
corporation (the "U.S. Borrower"), hereby promises to pay to the order of
NationsBank of North Carolina, N.A., (the "Lender"), at the office of the Lender
(or at such other place or places as the holder may designate); at the times set
forth in that certain Amended and Restated Credit Agreement dated as of February
25, 1994 among Shorewood Packaging Corporation, Shorewood corporation of Canada
Limited, the Administrative Agent, the Canadian Administrative Agent and the
Lenders party thereto (as amended by that certain First Amendment to Amended and
Restated Credit Agreement dated as of July 18, 1994, as amended by that certain
Second Amendment to Amended and Restated Credit Agreement dated as of the date
hereof, and as further amended or modified from time to time, the "Credit
Agreement"), the principal sum of TWO MILLION DOLLARS ($2,000,000.00) or such
lesser amount as is then outstanding and owing to Lender and to pay interest
from the date hereof on the unpaid principal amount hereof outstanding from time
to time on the dates and at the rate in accordance with Section 2.07 of the
Credit Agreement. All capitalized terms used herein and not otherwise defined
shall have the meanings ascribed thereto in the Credit Agreement, and the terms,
conditions and covenants of the Credit Agreement are expressly incorporated
herein and made a part hereof.
If an Event of Default occurs, the principal balance outstanding
hereunder shall bear interest as provided in Section 4.01 of the Credit
Agreement. Further, in the event the payment of all sums due hereunder is
accelerated under the terms of the Credit Agreement, this Note, and all other
indebtedness of the U.S. Borrower to the Lender shall become immediately due and
payable, without presentment, demand, protest or notice of any kind, all of
which are hereby waived by the U.S. Borrower.
In the event this Note is not paid when due at any stated or accelerated
maturity, the U.S. Borrower agrees to pay, in addition to the principal and
interest, all costs of collection, including reasonable attorneys' fees.
1
<PAGE> 34
To Revolving Credit and
Term Loan Agreement
The U.S. Borrower has caused this Note to be executed by its duly
authorized officer as of the day and year first above written.
SHOREWOOD PACKAGING CORPORATION
By:
---------------------------
Name:
-------------------------
Title:
------------------------
2
<PAGE> 1
EXHIBIT 10.93
<PAGE> 2
INDEX
LEASE dated as of February 6, 1995, Between
STANLEY STAHL, d/b/a STAHL PARK AVENUE
CO., Owner,
and
SHOREWOOD PACKAGING CORPORATION, Tenant
- --------------------------------------------------------------------------------
Printed Provisions
<TABLE>
<CAPTION>
Article Page
------- ----
<S> <C> <C>
Granting Clause
1 Rent 1
2 Use 1
3 Alterations 1
4 Repairs 1
5 Window Cleaning 1
6 Requirements of Law, Fire Insurance, Floor Loads 1
7 Subordination [Intentionally Deleted] 2
8 Property-Loss, Damage, Reimbursement, Indemnity 2
9 Destruction, Fire and Other Casualty 2
10 Eminent Domain 2
11 Assignment, Mortgage, Etc 2
12 Electric Current [Intentionally Deleted] 2
13 Access to Premises 3
14 Vault, Vault Space, Area 3
15 Occupancy 3
16 Bankruptcy 3
17 Default 3
18 Remedies of Owner and Waiver of Redemption 3
19A Fees and Expenses 3
19B Building Alterations and Management 3
20 No Representations by Owner 3
21 End of Term 4
22 Quiet Enjoyment 4
23 Failure to Give Possession 4
24 No Waiver 4
25 Waiver of Trial by Jury 4
26 Inability to Perform 4
27 Bills and Notices 4
28 Services Provided by Owner-Water, Elevators, Heat, 4
Cleaning, Air Conditioning
29 Captions 4
30 Definitions 4
31 Adjacent Excavation-Shoring 5
32 Rules and Regulations 5
33A Security 5
33B Estoppel Certificate 5
33C Successors and Assigns 5
</TABLE>
i
<PAGE> 3
<TABLE>
<CAPTION>
Rider Page
- ----- ----
<S> <C> <C>
34 Application of this Rider 6
A - Rider Provisions Paramount
B - Additional Definitions
C - Some Qualifications of Certain Preceding
Printed Articles
35 Electricity 15
36 Superior Leases and Mortgages 18
37 Estoppel Certificate 20
38 Indemnification and Liability of Owner 21
39 Escalation for Increases in Real Estate Taxes 21
40 Escalation for Operating Expenses 23
41 Restrictions on Signs 27
42 Consents 27
43 Informal Arbitration 28
44 Assignment and Subletting 29
45 Brokerage 31
46 Rent Control 31
47 Condition of Demised Premises 32
48 Insurance 34
49 Abatement of Rents 35
50 Intentionally Omitted 35
51 Miscellaneous Addition Provisions 35
Exhibits
- --------
A Floor Plan
B Owner's Work
B-1 Floor Plan Showing Location of Induction Unit Cover
Grilles and Mullion Covers to be Replaced
C Cleaning Schedule
D Rules and Regulations
E Certificate of Occupancy
F Funding Procedures
G Approved Contractors
H HVAC Specifications
</TABLE>
ii
<PAGE> 4
AGREEMENT OF LEASE, made as of this 6th day of February 1995,
between STANLEY STAHL, d/b/a STAHL PARK AVENUE CO., having an office at 277 Park
Avenue, New York party of the first part, hereinafter referred to as OWNER, and
SHOREWOOD PACKAGING CORPORATION, a Delaware corporation having an office at 10
East 53rd Street, New York, New York party of the second part, hereinafter
referred to as TENANT,
Witnesseth: Owner hereby leases to Tenant and Tenant hereby hires
from Owner the entire tenant occupancy area of the thirtieth (30th) floor
indicated by hatching on the floor plan annexed hereto and made a part hereof as
Exhibit "A" (hereinafter sometimes called the "premises" or the "demised
premises", whether or not capitalized), in the building known as 277 Park Avenue
(hereinafter sometimes called the "Building", whether or not capitalized) in the
Borough of Manhattan, City of New York, for a term of approximately fifteen (15)
years, six (6) months to commence on the date hereof (the "Commencement Date"),
and to end on August 14, 2010 (the "Expiration Date") both dates inclusive, at
the annual rates set forth and described as "fixed rent" in Article 34B(1)
hereof, which Tenant agrees to pay in lawful money of the United States which
shall be legal tender in payment of all debts and dues, public and private, at
the time of payment, in equal monthly installments in advance on the first day
of each month during said term, at the office of Owner or such other place, or
such agent and at such place as Owner may designate in writing, without any set
off or deduction whatsoever.
The parties hereto, for themselves, their heirs, distributees,
executors, administrators, legal representatives, successors and assigns, hereby
covenant as follows:
RENT OCCUPANCY:
(a) Tenant shall pay rent as hereinafter provided.
(b) Tenant shall use and occupy the demised premises for executive,
general and administrative offices for the conduct of Tenant's packaging
business, including, sales, customer service and the designing of packages and
for uses customarily incidental to such office use and not contrary to any of
the provisions of this lease.
TENANT ALTERATIONS:
(c) Tenant shall make no changes in or to the demised premises of
any nature without Owner's prior written consent. Subject to the prior written
consent of Owner, and to the provisions of this article, Tenant at Tenant's
expense, may make alterations, installations, additions or improvements which
are non-structural and which do not adversely affect utility services or
plumbing and electrical lines, in or to the interior of the demised premises by
using contractors or mechanics selected by Tenant and reasonably approved by
Owner. Anything contained in this Article 3 or in Article 34C(3) of this Lease
to the contrary notwithstanding, Owner's consent shall not be unreasonably
withheld or delayed with respect to any nonstructural Tenant's Changes, provided
that (x) consent for such Tenant's Change is not required by any Mortgagee or
Lessor (as such terms are hereinafter defined), and (y) such Tenant's Change (i)
is
1
<PAGE> 5
not visible from the outside of the Building, (ii) does not affect any part of
the Building other than the Demised Premises, (iii) does not affect any
services required to be furnished by Owner to any other tenant or occupant of
the Building, (iv) does not affect the proper functioning of any Building
Systems (hereinafter defined), (v) does not impair or diminish the value or
utility for the Building, and (vi) does not affect the certificate of occupancy
for the Building or the Demised Premises. The term "Building Systems" shall
mean the mechanical, gas, electrical, sanitary, heating, air conditioning,
ventilating, elevator, plumbing, life-safety and other service systems of the
Building. Tenant shall, before making any alterations, additions,
installations or improvements, at its expense, obtain all permits, approvals
and certificates required by any governmental or quasi-governmental bodies and
(upon completion) certificates of final approval thereof and shall deliver
promptly duplicates of all such permits, approvals and certificates to Owner
and Tenant agrees to carry and will cause Tenant's contractors and
sub-contractors to carry such workman's compensation, general liability,
personal and property damage insurance as Owner may reasonably require. If any
mechanic's lien or U.C.C. financing statement is filed against the demised
premises, or the building of which the same forms a part, for work claimed to
have been done for, or materials furnished to, Tenant, whether or not done
pursuant to this article, the same shall be discharged by Tenant within thirty
days after notice at Tenant's expense, by filing the bond required by law or
otherwise. All fixtures and all paneling, partitions, railings and like
installations, installed in the premises at any time, either by Tenant or by
Owner in Tenant's behalf, shall, upon installation, become the property of
Owner and shall remain upon and be surrendered with the demised premises unless
same are required to be removed pursuant to Article 34C(3)(c) hereof, in which
event the same shall be removed from the premises by Tenant prior to the
expiration of the lease, at Tenant's expense. Nothing in this Article shall be
construed to give Owner title to or to prevent Tenant's removal of trade
fixtures, moveable office furniture and equipment, but upon removal of any such
from the premises or upon removal of other installations as may be required by
Owner, Tenant shall immediately and at its expense, repair and restore the
premises to the condition existing prior to installation and repair any damage
to the demised premises or the building due to such removal reasonable wear and
tear excepted. All property required to be removed, by Tenant at the end of
the term remaining in the premises after Tenant's removal shall be deemed
abandoned and may, at the election of Owner, either be retained as Owner's
property or may be removed from the premises by Owner, at Tenant's expense.
MAINTENANCE AND REPAIRS:
(d) Tenant shall, throughout the term of this lease, take reasonably
good care of the demised premises and the fixtures and appurtenances therein.
Tenant shall be responsible for all damage or injury to the demised premises or
any other part of the building and the systems and equipment thereof, whether
requiring structural or nonstructural repairs caused by or resulting from
carelessness, omission, neglect or improper conduct of Tenant, Tenant's
subtenants, agents, employees, invitees or licensees, or which arise out of any
work, labor, service or equipment done for or supplied to Tenant or any
subtenant or arising out of the installation, use or operation of the property
or equipment of Tenant or any subtenant. Tenant shall also repair all damage to
the building and the demised premises caused by the moving of
2
<PAGE> 6
Tenant's fixtures, furniture and equipment. Tenant shall promptly make, at
Tenant's expense, all repairs in and to the demised premises for which Tenant
is responsible, using only the contractor for the trade or trades in question,
selected from a list of at least two contractors per trade submitted by Owner.
A list of the approved contractors for the performance of the Initial Tenant's
Changes is set forth on Exhibit "G" annexed hereto and made a part hereof. If
Tenant engages any contractor set forth on such list, Tenant shall not be
required to obtain Owner's consent for such contractor unless prior to the
earlier of (a) entering into a contract with such contractor, and (b) the
commencement of work by such contractor, Owner shall notify Tenant that such
contractor has been removed from the list. Any other repairs in or to the
building or the facilities and systems thereof for which Tenant is responsible
shall be performed by Owner at the Tenant's expense. Owner shall maintain in
good working order and repair the exterior and the structural portions of the
building, including the structural portions of its demised premises, and the
public portions of the building interior and the building plumbing, electrical,
heating and ventilating systems (to the extent such systems presently exist)
serving the demised premises. Tenant agrees to give prompt notice of any
defective condition in the premises for which Owner may be responsible
hereunder. There shall be no allowance to Tenant for diminution of rental
value and no liability on the part of Owner by reason of inconvenience,
annoyance or injury to business arising from Owner or others making repairs,
alterations, additions or improvements in or to any portion of the building or
the demised premises or in and to the fixtures, appurtenances or equipment
thereof. It is specifically agreed that Tenant shall not be entitled to any
setoff or reduction of rent by reason of any failure of Owner to comply with
the covenants of this or any other article of this Lease. Tenant agrees that
Tenant's sole remedy at law in such instance will be by way of an action for
damages for breach of contract. The provisions of this Article 4 shall not
apply in the case of fire or other casualty which are dealt with in Article 9
hereof.
WINDOW CLEANING:
(e) Tenant will not clean nor require, permit, suffer or allow any
window in the demised premises to be cleaned from the outside in violation of
Section 202 of the Labor Law or any other applicable law or of the Rules of the
Board of Standards and Appeals, or of any other Board or body having or
asserting jurisdiction.
REQUIREMENTS OF LAW, FIRE INSURANCE, FLOOR LOADS:
(f) Tenant, at Tenant's sole cost and expense, shall promptly comply
with all present and future laws, orders and regulations of all state, federal,
municipal and local governments, departments, commissions and boards and any
direction of any public officer pursuant to law, and all orders, rules and
regulations of the New York Board of Fire Underwriters, Insurance Services
Office, or any similar body which shall impose any violation, order or duty upon
Owner or Tenant with respect to the demised premises, whether or not arising out
of Tenant's use or manner of use thereof, (including Tenant's permitted use) or,
with respect to the building if arising out of Tenant's use or manner of use of
the premises or the building (including the use permitted under the lease).
Nothing herein shall require Tenant to
3
<PAGE> 7
make structural repairs or alterations unless Tenant has, by its manner of use
of the demised premises or method of operation therein, violated any such laws,
ordinances, orders, rules, regulations or requirements with respect thereto.
Notwithstanding anything to the contrary contained herein, Tenant shall comply
with the Americans with Disabilities Act of 1990, as amended ("ADA"), as it
pertains to the Demised Premises and Owner shall comply with ADA as it pertains
to the common areas of the Building. Tenant may, after securing Owner to
Owner's reasonable satisfaction against all damages, interest, penalties and
expenses, including, but not limited to, reasonable attorney's fees, by cash
deposit or by surety bond in an amount and in a company reasonably satisfactory
to Owner, contest and appeal any such laws, ordinances, orders, rules,
regulations or requirements provided same is done with all reasonable
promptness and provided such appeal shall not subject Owner to prosecution for
a criminal offense or constitute a default under any lease or mortgage under
which Owner may be obligated, or cause the demised premises or any part thereof
to be condemned or vacated. Tenant shall not do or permit any act or thing to
be done in or to the demised premises which is contrary to law, or which will
invalidate or be in conflict with public liability, fire or other policies of
insurance at any time carried by or for the benefit of Owner with respect to
the demised premises or the building of which the demised premises form a part,
or which shall or might subject Owner to any liability or responsibility to any
person or for property damage. Tenant shall not keep anything in the demised
premises except as now or hereafter permitted by the Fire Department, Board of
Fire Underwriters, Fire Insurance Rating Organization or other authority having
jurisdiction, and then only in such manner and such quantity so as not to
increase the rate for fire insurance applicable to the building, nor use the
premises in a manner which will increase the insurance rate for the building or
any property located therein over that which would otherwise be in effect.
Tenant shall pay all costs, expenses, fines, penalties, or damages, which may
be imposed upon Owner by reason of Tenant's failure to comply with the
provisions of this article and if by reason of such failure the fire insurance
rate shall, at the beginning of this lease, or at any time thereafter, be
higher than it otherwise would be, then Tenant shall reimburse Owner, as
additional rent hereunder, for that portion of all fire insurance premiums
thereafter paid by Owner which shall have been charged because of such failure
by Tenant within thirty (30) days after written notice by Owner to Tenant
describing the manner of Tenant's use of the Demised Premises which constitutes
such failure by Tenant and the name and address of the entity demanding such
increased payment and including a copy of the notice which Owner received
demanding same. In any action or proceeding wherein Owner and Tenant are
parties, a schedule or "make-up" of rate for the building or demised premises
issued by the New York Fire Insurance Exchange, or other body making fire
insurance rates applicable to said premises shall be conclusive evidence of the
facts therein stated and of the several items and charges in the fire insurance
rates then applicable to said premises. Tenant shall not place a load upon any
floor of the demised premises exceeding the floor load per square foot area
which it was designed to carry and which is allowed by law. Owner reserves the
right to reasonably prescribe the weight and position of all safes, business
machines and mechanical equipment. Such installations shall be placed and
maintained by Tenant, at Tenant's expense, in settings sufficient, in Owner's
reasonable judgement, to absorb and prevent vibration, noise and annoyance.
4
<PAGE> 8
SUBORDINATION:
(g) (SEE ARTICLE 36)
PROPERTY-LOSS, DAMAGE, REIMBURSEMENT, INDEMNITY:
(h) Owner or its agents shall not be liable for any damage to
property of Tenant or of others entrusted to employees of the building, nor for
loss of or damage to any property of Tenant by theft or otherwise, nor for any
injury or damage to persons or property resulting from any cause of whatsoever
nature, unless caused by or due to the negligence of Owner, its agents, servants
or employees. Owner or its agents will not be liable for any such damage caused
by other tenants or persons in, upon or about said building caused by operations
in construction of any private, public or quasi public work.
If at any time any windows of the demised premises are temporarily
closed, darkened or bricked up (or permanently closed, darkened or bricked up,
if required by law) for any reason whatsoever including, but not limited to
Owner's own acts, Owner shall not be liable for any damage Tenant may sustain
thereby and Tenant shall not be entitled to any compensation therefor nor
abatement or diminution of rent nor shall the same release Tenant from its
obligations hereunder nor constitute an eviction. Tenant shall indemnify and
save harmless Owner against and from all liabilities, obligations, damages,
penalties, claims, costs and expenses for which Owner shall not be reimbursed by
insurance, including reasonable attorneys fees, paid, suffered or incurred as a
result of any breach by Tenant, Tenant's agents, contractors, employees,
invitees, or licensees, of any covenant or condition of this lease, or the
carelessness, negligence or improper conduct of the Tenant, Tenant's agents,
contractors, employees, invitees or licensees. Tenant's liability under this
lease extends to the acts and omissions of any sub-tenant, and any agent,
contractor, employee, invitee or licensee of any sub-tenant, and any agent,
contractor, employee, invitee or licensee of any sub-tenant. In case any action
or proceeding is brought against Owner by reason of any such claim, Tenant, upon
written notice from Owner, will, at Tenant's expense, resist or defend such
action or proceeding by counsel approved by Owner in writing, such approval not
to be unreasonably withheld.
DESTRUCTION, FIRE AND OTHER CASUALTY:
(i) (a) If the demised premises or any part thereof shall be damaged
by fire or other casualty, Tenant shall give immediate notice thereof to Owner
and this lease shall continue in full force and effect except as hereinafter set
forth, (b) If the demised premises are partially damaged or rendered partially
unusable by fire or other casualty, the damages thereto shall be repaired by and
at the expense of Owner and the rent, until such repair shall be substantially
completed, shall be apportioned from the day following the casualty according to
the part of the premises which is usable, (c) If the demised premises are
totally or substantially totally damaged or rendered wholly unusable by fire or
other casualty, then the rent shall be proportionately paid up to the time of
the casualty and thenceforth shall cease until the date when the premises shall
have been repaired and restored by Owner, subject to Owner's right to elect
5
<PAGE> 9
not to restore the same as hereinafter provided, (d) Whether or not the demised
premises are damaged in whole or in part, if the building shall be so damaged
that Owner shall decide to demolish it or to rebuild it, then, in any of such
events, Owner may elect to terminate this lease by written notice to Tenant,
given within 90 days after such fire or casualty, specifying a date for the
expiration of the lease, which date shall not be more than 60 days after the
giving of such notice, and upon the date specified in such notice the term of
this lease shall expire as fully and completely as if such date were the date
set forth above for the termination of this lease and Tenant shall forthwith
quit, surrender and vacate the premises without prejudice however, to
Landlord's rights and remedies against Tenant under the lease provisions in
effect prior to such termination, and any rent owing shall be paid up to such
date and any payments of rent made by Tenant which were on account of any
period subsequent to such date shall be returned to Tenant, (e) Anything
contained herein to the contrary notwithstanding, within forty-five (45) days
after notice to Owner of any damage described in this Article 9, Owner shall
deliver to Tenant a statement prepared by a reputable contractor setting forth
such contractor's good faith estimate as to the time required to repair such
damage. If such estimated time period exceeds nine (9) months (exclusive of
Specialty Tenant's Changes [hereinafter defined] and Tenant's Property) from
the date of such statement, subject to delays beyond Owner's reasonable
control, Tenant may elect to terminate this Lease by giving notice to Owner not
later than thirty (30) days following Tenant's receipt of such statement. If
Tenant makes such election, the term of this Lease shall expire on the
thirtieth (30th) day after the date notice of such election is given, and
Tenant shall vacate the Demised Premises and surrender the same to Owner on
such date in accordance with Article 21 hereof and the fixed rent and
escalation rent shall be apportioned and any prepaid portion of fixed rent and
escalation rent for any period after such date shall be refunded by Owner to
Tenant within thirty (30) days of such election. If Tenant does not elect to
terminate this Lease pursuant to this Article 9 (or is not entitled to
terminate this Lease pursuant to this Article 9), Owner shall be obligated to
use reasonably diligent efforts to perform such repair to completion. If such
repairs (exclusive of Specialty Tenant's Changes and Tenant's Property) are not
completed by Owner within ninety (90) days after the expiration of the period
estimated for effecting such repairs (subject to delays beyond Owner's
reasonable control) Tenant may elect to terminate this Lease by giving notice
to Owner not later than thirty (30) days following the expiration of such
ninety (90) day period. If Tenant makes such election, the term of this Lease
shall expire on the thirtieth (30th) day after the date notice of such election
is given, and Tenant shall vacate the Demised Premises and surrender the same
to Owner on such date in accordance with Article 21 hereof and the fixed rent
and escalation rent shall be apportioned and any prepaid portion of fixed rent
and escalation rent for any period after such date shall be refunded by Owner
to Tenant within thirty (30) days of such election. Tenant shall have no other
options to cancel this Lease under this Article 9. Unless Owner or Tenant
shall serve a termination notice as provided for herein, Owner shall make the
repairs and restorations under the conditions of (b) and (c) hereof, with all
reasonable expedition, subject to delays due to adjustment of insurance claims,
labor troubles and causes beyond Owner's control. After any such casualty,
Tenant shall cooperate with Owner's restoration by removing from the premises
as promptly as reasonably possible, all of Tenant's salvageable inventory and
movable equipment, furniture, and other property. Tenant's liability for rent
shall resume fifteen (15) days after written notice from Owner that the
premises are substantially ready for Tenant's
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occupancy, (f) Nothing contained hereinabove shall relieve Tenant from
liability that may exist as a result of damage from fire or other casualty.
Notwithstanding the foregoing, each party shall look first to any insurance in
its favor before making any claim against the other party for recovery for loss
or damage resulting from fire or other casualty, and to the extent that such
insurance is in force and collectible and to the extent permitted by law, Owner
and Tenant each hereby releases and waives all right of recovery against the
other or any one claiming through or under each of them by way of subrogation
or otherwise. The foregoing release and waiver shall be in force only if both
releasors' insurance policies contain a clause providing that such a release or
waiver shall not invalidate the insurance. If, and to the extent, that such
waiver can be obtained only by the payment of additional premiums, then the
party benefitting from the waiver shall pay such premium within ten days after
written demand or shall be deemed to have agreed that the party obtaining
insurance coverage shall be free of any further obligation under the provisions
hereof with respect to waiver of subrogation. Tenant acknowledges that Owner
will not carry insurance on Tenant's furniture and/or furnishings or any
fixtures or equipment, improvements, or appurtenances removable by Tenant and
agrees that Owner will not be obligated to repair any damage thereto or replace
the same, (g) Tenant hereby waives the provisions of Section 227 of the Real
Property Law and agrees that the provisions of this article shall govern and
control in lieu thereof.
EMINENT DOMAIN:
(j) If the whole or any part of the demised premises shall be
acquired or condemned by Eminent Domain for any public or quasi public use or
purpose, then and in that event, the term of this lease shall cease and
terminate from the date of title vesting in such proceeding and Tenant shall
have no claim for the value of any unexpired term of said lease and assigns to
Owner, Tenant's entire interest in any such award, and the rents shall be
prorated to such date. Anything in this Article 10 to the contrary
notwithstanding, Tenant shall have the right to make a separate claim in any
such eminent domain proceeding for its property and moving expenses, provided
that Tenant's claim shall not impair the ability of Owner to make its claim or
reduce the amount of Owner's award.
ASSIGNMENT, MORTGAGE, ETC.:
(k) Tenant, for itself, its heirs distributees, executors,
administrators, legal representatives, successors and assigns, expressly
covenants that it shall not assign, mortgage or encumber this agreement, nor
underlet, or suffer or permit the demised premises or any part thereof to be
used by others, without the prior written consent of Owner in each instance,
which consent to a sublease or to an assignment shall be governed by the terms
of Article 44 hereof. Transfer of the majority of the stock of a corporate
Tenant shall be deemed an assignment. If this lease be assigned, or if the
demised premises or any part thereof be underlet or occupied by anybody other
than Tenant, Owner may, after default by Tenant, collect rent from the assignee,
under-tenant or occupant, and apply the net amount collected to the rent herein
reserved, but no such assignment, underletting, occupancy or collection shall be
deemed a waiver of this covenant, or the acceptance of the assignee,
under-tenant or occupant as tenant,
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or a release of Tenant from the further performance by Tenant of covenants on
the part of Tenant herein contained. The consent by Owner to an assignment or
underletting shall not in any wise be construed to relieve Tenant from
obtaining the express consent in writing of Owner to any further assignment or
underletting.
ELECTRIC CURRENT:
(l) (SEE ARTICLE 35)
ACCESS TO PREMISES:
(m) Owner of Owner's agents shall have the right (but shall not be
obligated) to enter the demised premises in any emergency at any time, and upon
notice, at other reasonable times, to examine the same and to make such repairs,
replacements and improvements as Owner may reasonably deem necessary and
reasonably desirable to the demised premises or to any other portion of the
building or which Owner may elect to perform. Tenant shall permit Owner to use
and maintain and replace pipes and conduits in and through the demised premises
and to erect new pipes and conduits therein provided they are concealed within
the walls, floor, or ceiling. Owner shall use its reasonable efforts to minimize
interference with Tenant's use and occupancy of the Demised Premises in making
any such repairs, replacements or improvements or performing any such work;
provided, however, that Owner shall have no obligation to employ contractors or
labor at so-called overtime or other premium pay rates or to incur any other
overtime costs or expenses whatsoever, except that Owner, at its expense but
subject to recoupment pursuant to Article 40 hereof, shall employ contractors or
labor at so-called overtime or other premium pay rates if necessary to make any
repair required to be made by it hereunder to remedy any condition that either
(i) results in a denial of access to the Demised Premises, (ii) threatens the
health or safety of any occupant of the Demised Premises, or (iii) except in the
case of a fire or other casualty, materially interferes with Tenant's ability to
conduct its business in the Demised Premises. In all other cases, at Tenant's
request, Owner shall employ contractors or labor at so-called overtime or other
premium pay rates and incur any other overtime costs or expenses in connection
with such entry or making such repairs, alterations, additions or improvements
or performing any work in the Demised Premises, and Tenant shall pay to Owner,
as additional rent, within twenty (20) days after demand, an amount equal to the
difference between the overtime or other premium pay rates and the regular pay
rates for such labor and any other overtime costs or expenses so incurred. Owner
may, during the progress of any work in the demised premises, take all necessary
materials and equipment into said premises without the same constituting an
eviction nor shall the Tenant be entitled to any abatement of rent while such
work is in progress nor to any damages by reason of loss or interruption of
business or otherwise. Throughout the term hereof Owner shall have the right to
enter the demised premises at reasonable hours upon reasonable prior notice
(except if pursuant to a Requirement or in the event of an emergency) for the
purpose of showing the same to prospective purchasers or mortgagees of the
building, and during the last six months of the term for the purpose of showing
the same to prospective tenants. If Tenant is not present to open and permit an
entry into the premises, Owner or Owner's agents may enter the same
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whenever such entry may be necessary or permissible by master key or forcibly
(in the event of an emergency or if required pursuant to Requirements) and
provided reasonable care is exercised to safeguard Tenant's property, such
entry shall not render Owner or its agents liable therefor, nor in any event
shall the obligations of Tenant hereunder be affected. If during the last
month of the term Tenant shall have removed all or substantially all of
Tenant's property therefrom. Owner may immediately enter, alter, renovate or
redecorate the demised premises without limitation or abatement of rent, or
incurring liability to Tenant for any compensation and such act shall have no
effect on this lease or Tenant's obligations hereunder.
VAULT, VAULT SPACE, AREA:
(n) No Vaults, vault space or area, whether or not enclosed or
covered, not within the property line of the building is leased hereunder,
anything contained in or indicated on any sketch, blue print or plan, or
anything contained elsewhere in this lease to the contrary notwithstanding.
Owner makes no representation as to the location of the property line of the
building. All vaults and vault space and all such areas not within the property
line of the building, which Tenant may be permitted to use and/or occupy, is to
be used and/or occupied under a revocable license, and if any such license be
revoked, or if the amount of such space or area be diminished or required by any
federal, state or municipal authority or public utility, Owner shall not be
subject to any liability nor shall Tenant be entitled to any compensation or
diminution or abatement of rent, nor shall such revocation, diminution or
requisition be deemed constructive or actual eviction. Any tax, fee or charge of
municipal authorities for such vault or area shall be paid by Tenant.
OCCUPANCY:
(o) Tenant will not at any time use or occupy the demised premises
in violation of the certificate of occupancy issued for the building of which
the demised premises are a part which permits use of the Demised Premises for
the purposes stated in Article 2. Tenant has inspected the premises and accepts
them as is, subject to the riders annexed hereto with respect to Owner's work,
if any. In any event, Owner makes no representation as to the condition of the
premises and Tenant agrees to accept the same subject to violations, whether or
not of record provided such violations do not materially interfere with the
conduct of Tenant's business in the Demised Premises. To the best of Owner's
knowledge, there are no existing violations of record affecting the Demised
Premises or the Building which would adversely affect Tenant's use and occupancy
of the Demised Premises. On the Commencement Date a temporary or permanent
certificate of occupancy (a copy of the current certificate of occupancy is
attached hereto and made a part hereof as Exhibit "E") covering the Demised
Premises will be in force permitting the Demised Premises to be used as offices,
provided, however, neither such certificate, nor any provision in this Lease,
nor any act or omission of Owner, shall be deemed to constitute a representation
or warranty that the Demised Premises, or any part thereof, lawfully may be used
or occupied for any particular purpose or in any particular manner, in
contradistinction to mere "office" use.
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BANKRUPTCY:
(p) (a) See Article 34C(6) for substitution. Neither Tenant nor any
person claiming through or under Tenant, or by reason of any statute or order of
court, shall thereafter be entitled to possession of the premises demised but
shall forthwith quit and surrender the premises. If this lease shall be assigned
in accordance with its terms, the provisions of this Article 16 shall be
applicable only to the party then owning Tenant's interest in this lease.
(b) it is stipulated and agreed that in the event of the termination
of this lease pursuant to (a) hereof, Owner shall forthwith, notwithstanding any
other provisions of this lease to the contrary, be entitled to recover from
Tenant as and for liquidated damages an amount equal to the difference between
the rent reserved hereunder for the unexpired portion of the term demised and
the fair and reasonable rental value of the demised premises for the same
period. In the computation of such damages the difference between any
installment of rent becoming due hereunder after the date of termination and the
fair and reasonable rental value of the demised premises for the period for
which such installment was payable shall be discounted to the date of
termination at the rate of five and one-half percent (5.5%) per annum. If such
premises or any part thereof be relet by the Owner for the unexpired term of
said lease, or any part thereof, before presentation of proof of such liquidated
damages to any court, commission or tribunal, the amount of rent reserved upon
such reletting shall be deemed to be the fair and reasonable rental value for
the part or the whole of the premises so re-let during the term of the
re-letting. Nothing herein contained shall limit or prejudice the right of such
termination, 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 the amount of the difference referred to above.
DEFAULT:
(q) (1) If Tenant defaults beyond applicable grace periods, if any,
in fulfilling any of the covenants of this lease other than the covenants for
the payment of rent or additional rent; or if the demised premises are
abandoned; or if any execution or attachment shall be issued against Tenant or
any of Tenant's property whereupon the demised premises shall be taken or
occupied by someone other than Tenant; or if this lease be rejected under
Section 365 of Title 11 of the U.S. Code (bankruptcy code); or if Tenant shall
fail to move into or take possession of the premises within fifteen (15) days
after the commencement of the term of this lease, then, in any one or more of
such events, upon Owner serving a written twenty (20) days written notice upon
Tenant specifying the nature of said default and upon the expiration of said
twenty (20) days, if Tenant shall have failed to comply with or remedy such
default, or if the said default or omission complained of shall be of a nature
that the same cannot be completely cured or remedied within said twenty (20) day
period, and if Tenant shall not have diligently commenced curing such default
within such twenty (20) day period, and shall not thereafter with reasonable
diligence and in good faith, proceed to remedy or cure such default, then Owner
may serve a written five (5) days' notice of cancellation of this lease upon
Tenant, and upon the expiration of said five (5) days this lease and the term
thereunder shall end and expire as fully and
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completely as if the expiration of such five (5) day period were the day herein
definitely fixed for the end and expiration of this lease and the term thereof
and tenant shall then quit and surrender the demised premises to Owner but
Tenant shall remain liable as hereinafter provided.
(2) If the notice provided for in (1) hereof shall have been
given, and the term shall expire as aforesaid; or if Tenant shall make default
in the payment of the rent reserved herein or any item of additional rent herein
mentioned or any part of either or in making any other payment herein required;
then and in any of such events Owner may without further notice, re-enter the
demised premises either by force or otherwise, and dispossess Tenant by summary
proceedings or otherwise, and the legal representative of Tenant or other
occupant of demised premises and remove their effects and hold the premises as
if this lease had not been made, and Tenant hereby waives the service of further
notice of intention to re-enter or to institute legal proceedings to that end.
REMEDIES OF OWNER AND WAIVER OF REDEMPTION:
(r) In case of any such default, beyond applicable grace periods, if
any, re-entry, expiration and/or dispossess by summary proceedings or otherwise,
(a) the rent shall become due thereupon and be paid up to the time of such
re-entry, dispossess and/or expiration, (b) Owner may re-let the premises or any
part or parts thereof, either in the name of Owner or otherwise, for a term or
terms, which may at Owner's option be less than or exceed the period which would
otherwise have constituted the balance of the term of this lease and may grant
concessions or free rent or charge a higher rental than that in this lease,
and/or (c) Tenant or the legal representatives of Tenant shall also pay Owner as
liquidated damages for the failure of Tenant to observe and perform said
Tenant's covenants herein contained, any deficiency between the rent hereby
reserved and/or covenanted to be paid and the net amount, if any, of the rents
collected on account of the lease or leases of the demised premises for each
month of the period which would otherwise have constituted the balance of the
term of this lease. The failure of Owner to re-let the premises or any part or
parts thereof shall not release or affect Tenant's liability for damages. In
computing such liquidated damages there shall be added to the said deficiency
such expenses as Owner may incur in connection with re-letting, such as legal
expenses, reasonable attorneys' fees, brokerage, advertising and for keeping the
demised premises in good order or for preparing the same for re-letting. Any
such liquidated damages shall be paid in monthly installments by Tenant on the
rent day specified in this lease and any suit brought to collect the amount of
the deficiency for any month shall not prejudice in any way the rights of Owner
to collect the deficiency for any subsequent month by a similar proceeding.
Owner, in putting the demised premises in good order or preparing the same for
re-rental may, at Owner's option, make such alterations, repairs, replacements,
and/or decorations in the demised premises as Owner, in Owner's sole judgement,
considers advisable and necessary for the purpose of re-letting the demised
premises, and the making of such alterations, repairs, replacements, and/or
decorations shall not operate or be construed to release Tenant from liability
hereunder as aforesaid. Owner shall in no event be liable in any way whatsoever
for failure to re-let the demised premises, or in the event that the demised
premises are re-let, for failure to collect the rent thereof under such re-
letting, and in no event shall Tenant be entitled
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to receive any excess, if any, of such net rents collected over the sums
payable by Tenant to Owner hereunder. In the event of a breach or threatened
breach by Tenant of any of the covenants or provisions hereof, Owner shall have
the right of injunction and the right to invoke any remedy allowed at law or in
equity as if re-entry, summary proceedings and other remedies were not herein
provided for. Mention in this lease of any particular remedy, shall not
preclude Owner from any other remedy, in law or in equity. 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 Owner obtaining possession of demised premises,
by reason of the violation by Tenant of any of the covenants and conditions of
this lease, or otherwise.
FEES AND EXPENSES:
(s)A. 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 beyond
applicable grace periods, if any, then, unless otherwise provided elsewhere in
this lease. Owner may immediately without notice in the case of an emergency,
and at other times on reasonable prior notice perform the obligation of Tenant
thereunder. If Owner, in connection with the foregoing or in connection with any
default beyond applicable grace periods, if any, by Tenant in the covenant to
pay rent hereunder, makes any expenditures or incurs any obligations for the
payment of money, including but not limited to attorney's fees, in instituting,
prosecuting or defending any action or proceeding, then Tenant will reimburse
Owner for such sums so paid or obligations incurred with interest and costs. The
foregoing expenses incurred by reason of Tenant's default shall be deemed to be
additional rent hereunder and shall be paid by Tenant to Owner within ten (10)
days of rendition to any bill or statement to Tenant therefor. If Tenant's lease
term shall have expired at the time of making of such expenditures or incurring
of such obligations, such sums shall be recoverable by Owner as damages. Except
as otherwise specifically provided in this Lease, if any action shall be
commenced by Owner or Tenant against the other, the party which shall be
unsuccessful in such action shall bear the cost of the attorneys' fees and
disbursements of the party which shall be successful in such action. If both
parties shall be partially successful and, therefore, partially unsuccessful,
the attorneys' fees and disbursements shall be apportioned between Owner and
Tenant in inverse proportion to the success of each party in such action.
BUILDING ALTERATIONS AND MANAGEMENT:
19B. Owner shall have the right at any time 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, elevators, stairs, toilets or other public parts of the
building and to change the name, number or other public parts of
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the building and to change the name, number or designation by which the
building may be known provided that the services, facilities and means of
access to the Demised Premises to which Tenant is entitled as specified in this
Lease are not materially diminished. There shall be no allowance to Tenant for
diminution of rental value and no liability on the part of Owner by reason of
inconvenience, annoyance or injury to business arising from Owner or other
Tenants making any repairs in the building or any such alterations, additions
and improvements. Furthermore, Tenant shall not have any claim against Owner
by reason of Owner's imposition of such controls of the manner of access to the
building by Tenant's social or business visitors as the Owner may deem
necessary for the security of the building and its occupants.
NO REPRESENTATIONS BY OWNER:
1. Neither Owner nor Owner's agents have made any representations
or promises with respect to the physical condition of the building, the land
upon which it is erected or the demised premises, the rents, leases, expenses of
operation or any other matter or thing affecting or related to the 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 in
the provisions of this lease. Tenant has inspected the building and the demised
premises and is thoroughly acquainted with their condition and agrees to take
the same "as is" subject to the performance by Owner of the work ("Owner's
Work") set forth on Exhibit "B" annexed hereto and made a part hereof, and
acknowledges that the taking of possession of the demised premises by Tenant
shall be conclusive evidence that the said premises and the building of which
the same form a part were in good and satisfactory condition at the time such
possession was so taken, except as to latent defects. All understandings and
agreements heretofore made between the parties hereto are merged in this
contract, which alone fully and completely expresses the agreement between Owner
and Tenant 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.
END OF TERM:
2. Upon the expiration or other termination of the term of this
lease, Tenant shall quit and surrender to Owner the demised premises, broom
clean, in good order and condition, ordinary wear and damage by fire or other
insurable casualty and damages which Tenant is not required to repair as
provided elsewhere in this lease excepted, and, subject to Article 3 and Article
34C(3)(c) hereof, Tenant shall remove all its property, Tenant's obligation to
observe or perform this covenant shall survive the expiration or other
termination of this lease. If the last day of the term of this Lease or any
renewal thereof, falls on Sunday, this lease shall expire at noon on the
preceding Saturday unless it be a legal holiday in which case it shall expire at
noon on the preceding business day.
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QUITE ENJOYMENT:
3. Owner covenants and agrees with Tenant that upon Tenant paying
the rent and additional rent and observing and performing all the terms,
covenants and conditions, on Tenant's part to be observed and performed, Tenant
may peaceably and quietly enjoy the premises hereby demised, subject,
nevertheless, to the terms and conditions of this lease including, but not
limited to, Article 31 hereof and to the ground leases, underlying leases and
mortgages hereinbefore mentioned.
FAILURE TO GIVE POSSESSION:
4. If Owner is unable to give possession of the demised premises
on the date of the commencement of the term hereof, because of the holding-over
or retention of possession of any tenant, undertenant or occupants or if the
demised premises are located in a building being constructed, because such
building has not been sufficiently completed to make the premises ready for
occupancy or because of the fact that a certificate of occupancy has not been
procured or for any other reason, Owner shall not be subject to any liability
for failure to give possession on said date and the validity of the lease shall
not be impaired under such circumstances, nor shall the same be construed in any
wise to extend the term of this lease, but the rent payable hereunder shall be
abated (provided Tenant is not responsible for Owner's inability to obtain
possession) until after Owner shall have given Tenant written notice that the
premises are substantially read for Tenant's occupancy. If permission is given
to Tenant to enter into the possession of the demised premises or to occupy
premises other than the demised premises prior to the date specified as the
commencement of the term of this lease, Tenant covenants and agrees that such
occupancy shall be deemed to be under all the terms, covenants, conditions and
provisions of this lease, except as to the covenant to pay rent. The provisions
of this article are intended to constitute "an express provision to the
contrary" within the meaning of Section 223-a of the New York Real Property Law.
NO WAIVER:
5. The failure of Owner to seek redress for violation of, or to
insist upon the strict performance of any covenant or condition of this lease or
of any of the Rules or Regulations, set forth or hereafter adopted by Owner,
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 Owner of rent with knowledge of the breach of any covenant of this
lease shall not be deemed a waiver of such breach and no provision of this lease
shall be deemed to have been waived by Owner unless such waiver be in writing
signed by Owner. No payment by Tenant or receipt by Owner of a lesser amount
than the monthly rent herein stipulated shall be deemed to be other than on
account of the earliest stipulated rent, nor shall any endorsement or statement
of any check or any letter accompanying any check or payment as rent be deemed
an accord and satisfaction, and Owner may accept such check or payment without
prejudice to
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Owner's right to recover the balance of such rent or pursue any other remedy in
this lease provided. No act or thing done by Owner or Owner's agents during
the term hereby demised shall be deemed an acceptance of a surrender of said
premises, and no agreement to accept such surrender shall be valid unless in
writing signed by Owner. No employee of Owner or Owner's agent shall have any
power to accept the keys of said premises prior to the termination of the lease
and the delivery of keys to any such agent or employee shall not operate as a
termination of the lease or a surrender of the premises.
WAIVER OF TRIAL BY JURY:
6. It is mutually agreed by and between Owner and Tenant that the
respective parties hereto shall and they hereby do waive trial by jury in any
action, proceeding or counterclaim brought by either of the parties hereto
against the other (except for personal injury or property damage) on any matters
whatsoever arising out of or in any way connected with this lease, the
relationship of Owner and Tenant, Tenant's use of or occupancy of said premises,
and any emergency statutory or any other statutory remedy. It is further
mutually agreed that in the event Owner commences any summary proceeding for
possession of the premises, Tenant will not interpose any counterclaim of
whatever nature or description in any such proceeding including a counterclaim
under Article 4, unless failure to interpose such counterclaim would preclude
Tenant from asserting in a separate action the claim which is the subject of the
counterclaim.
INABILITY TO PERFORM:
7. This Lease and the obligation of Tenant to pay rent hereunder
and perform all of the other covenants and agreements hereunder on part of
Tenant to be performed shall in no wise be affected, impaired or excused because
Owner is unable to fulfill any of its obligations under this lease or to supply
or is delayed in supplying any service expressly or impliedly to be supplied or
is unable to make, or is delayed in making any repair, additions, alterations or
decorations or is unable to supply or is delayed in supplying any equipment or
fixtures if Owner is prevented or delayed from so doing by reason of strike or
labor troubles, government preemption in connection with a National Emergency or
by reason of any rule, order or regulation of any department or subdivision
thereof of any government agency or by reason of the conditions of supply and
demand which have been or are affected by war or other emergency or by reason of
any other cause beyond Owner's reasonable control. (Collectively, "Unavoidable
Delays"). This Lease and the obligations, covenants and agreements of Owner
hereunder shall in no wise be effected, impaired, or excused because Tenant is
unable to fulfill any of its obligations under this Lease expressly or impliedly
to be performed or observed by Tenant, other than the obligation to pay when due
fixed rent, additional rent and any other item of rental, by reason of
Unavoidable Delays (except that Tenant's insolvency or financial condition shall
not be considered an Unavoidable Delay), provided that Tenant uses due diligence
to effect performance or observance of such obligation, covenant or agreement as
soon as possible after the Unavoidable Delay no longer exists.
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BILLS AND NOTICES:
8. Except as otherwise in this lease provided, a bill, statement,
notice or communication which Owner may desire to be required to give to Tenant,
shall be deemed sufficiently given or rendered if, in writing, delivered to
Tenant personally or sent by registered or certified mail addressed to Tenant
personally or sent by registered or certified mail addressed to Tenant at the
building of which the demised premises form a part or at the last known
residence address or business address of Tenant or left at any of the aforesaid
premises addressed to Tenant, and the time of the rendition of such bill or
statement and of the giving of such notice or communication shall be deemed to
be the time when the same is delivered to Tenant, mailed, or left at the
premises as herein provided. Any notice by Tenant to Owner must be served by
registered or certified mail addressed to Owner at the address first hereinabove
given or at such other address as Owner shall designate by written notice. A
copy of notices sent to Tenant shall be sent to Bryan Cave, 245 Park Avenue, New
York, New York 10167, Attention: Richard Zakin, Esq. A copy of notices sent to
Owner shall be sent to Latham & Watkins, 885 Third Avenue, New York, New York
10022, Attention: Richard L. Chadakoff, Esq.
SERVICES PROVIDED BY OWNERS:
9. As long as this lease is in full force and effect, Owner shall
provide: (a) necessary elevator facilities on business days from 8:00 a.m. to
6:00 p.m. and on Saturdays from 9:00 a.m. to 1:00 p.m. and have one elevator
subject to call at all other times; (b) heat to the demised premises when and as
required by law, on business days from 8:00 a.m. to 6:00 p.m., and on Saturdays
from 9:00 a.m. - 1:00 p.m.; (c) water for ordinary lavatory and drinking
purposes, but if Tenant uses or consumes water for any other purposes or in
unusual quantities (of which fact Owner shall determine in its reasonable
judgment), Owner may install a water meter at Tenant's expense which Tenant
shall thereafter maintain at Tenant's expense in good working order and repair
to register such water consumption and Tenant shall pay for water consumed as
shown on said meter as additional rent as and when bills are rendered; (d)
cleaning service for the demised premises on business days at Owner's expense
provided that the same are kept in order by Tenant in accordance with the
cleaning specifications set forth on Exhibit "C" annexed hereto. Tenant shall
pay Owner the cost of removal of any of Tenant's refuse and rubbish from the
building which is (x) in excess of that which is normally attendant to normal
office use and (y) comprised of cartons, recyclable plastics and wet rubbish;
(e) If the demised premises are serviced by Owner's air conditioning/cooling and
ventilating system, air conditioning/cooling will be furnished to Tenant on
business days (Mondays through Fridays, holidays excepted) from 8:00 a.m. to
6:00 p.m. on Saturdays from 9:00 a.m. to 1:00 p.m., and ventilation will be
furnished on business days during the aforesaid hours except when air
conditioning/cooling is being furnished as aforesaid. If Tenant requires air
conditioning/cooling or ventilation for more extended hours or on Saturdays,
Sundays or on holidays, as defined under Owner's contract with Operating
Engineers Local 94-94A, Owner will furnish the same
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at Tenant's expense; (f) Owner reserves the right to stop services of the
heating, elevators, plumbing, air-conditioning, power systems or cleaning or
other services, if any, when necessary by reason of accident or for repairs,
alterations, replacements or improvements necessary or desirable in the
judgment of Owner for as long as may be reasonably required by reason thereof.
If the building of which the demised premises are a part supplies
manually-operated elevator service, Owner at any time may substitute
automatic-control elevator service and upon ten days' written notice to Tenant,
proceed with alterations necessary therefor without in any wise affecting this
lease or the obligation of Tenant hereunder. The same shall be done with a
minimum of inconvenience to Tenant and Owner shall pursue the alteration with
due diligence.
CAPTIONS:
10. 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 provisions thereof.
DEFINITIONS:
11. The term "office", or "offices", wherever used in this lease,
shall not be construed to mean premises used as a store or stores, for the sale
or display, at any time, of goods, wares or merchandise, of any kind, or as a
restaurant, shop, booth, bootblack or other stand, barber shop, or for other
similar purposes or for manufacturing. The term "Owner" means a landlord or
lessor, and as used in this lease means only the owner, or the mortgagee in
possession, for the time being of the land and building (or the owner of a lease
of the building or of the land and building) of which the demised premises form
a part, so that in the event of any sale or sales of said land and building or
of said lease, or in the event of a lease of said building, or of the land and
building, the said Owner shall be and hereby is entirely freed and relieved of
all covenants and obligations of Owner hereunder, and it shall be deemed and
construed without further agreement between the parties or their successors in
interest, or between the parties and the purchaser, at any such sale, or the
said lessee of the building, or of the land and building, that the purchaser or
the lessee of the building has assumed and agreed to carry out any and all
covenants and obligations of Owner, hereunder. The words "re-enter" and
"re-entry" as used in this lease are not restricted to their technical legal
meaning. The term "business days" as used in this lease shall exclude Saturdays
(except such portion thereof as is covered by specific hours in Article 28
hereof), Sundays and all days observed by the State or Federal Government or by
local 32B-32J, Building Service Employees Union, AFL-CIO, or any successor
thereto as legal holidays and those designated as holidays by the applicable
building service union employees service contract or by the applicable Operating
Engineers contract with respect to HVAC service.
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ADJACENT EXCAVATION-SHORING:
12. If an excavation shall be made upon land adjacent to the
demised premises, or shall be authorized to be made, Tenant shall afford to the
person causing or authorized to cause such excavation, license to enter upon the
demised premises for the purpose of doing such work as said person shall deem
necessary to preserve the wall or the building of which demised premises form a
part from injury or damage and to support the same by proper foundations without
any claim for damages or indemnity against Owner, or diminution or abatement of
rent.
RULES AND REGULATIONS:
13. Tenant and Tenant's servants, employees, agents, visitors,
and licensees shall observe faithfully, and comply strictly with, the Rules and
Regulations set forth on Exhibit "D" annexed hereto and made a part hereof and
such other and further reasonable Rules and Regulations as Owner and Owner's
agents may from time to time adopt. Notice of any additional rules or
regulations shall be given in such manner as Owner may elect. In case Tenant
disputes the reasonableness of any additional Rule or Regulation hereafter made
or adopted by Owner or Owner's agents, the parties hereto agree to submit the
question of the reasonableness of such Rule or Regulation for decision by
informal arbitration pursuant to Article 43 hereof. The right to dispute the
reasonableness of any additional Rule or Regulation upon Tenant's part shall be
deemed waived unless the same shall be asserted by service of a notice, in
writing upon Owner within ten (10) days after the giving of notice thereof.
Nothing in this lease contained shall be construed to impose upon Owner any duty
or obligation to enforce the Rules and Regulations or terms, covenants or
conditions in any other lease, as against any other tenant and Owner shall not
be liable to Tenant for violation of the same by any other tenant, its servants,
employees, agents, visitors or licensees.
SUCCESSORS AND ASSIGNS:
14. The covenants, conditions and agreements contained in this
lease shall bind and inure to the benefit of Owner and Tenant and their
respective heirs, distributees, executors, administrators, successors, and
except as otherwise provided in this lease, their assigns. SEE ATTACHED RIDER
CONTAINING ARTICLES 34 THROUGH 51 INCLUSIVE.
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In Witness Whereof, Owner and Tenant have respectively signed and
sealed this lease as of the day and year first above written.
Witness for Owner: /s/ Stanley Stahl
----------------------------------------
/s/ Leslie E. Slatin
- --------------------
STANLEY STAHL, d/b/a
STAHL PARK AVENUE CO.
----------------------------------------
SHOREWOOD PACKAGING CORPORATION
----------------------------------------
Witness for Tenant:
/s/ Richard J. Zakin By: /s/ Howard M. Liebman
- -------------------- ------------------------------------
Name: Howard M. Liebman
----------------------------------
Title: Executive Chief Financial Officer
----------------------------------
Tenant's Federal
I.D. No.: 11-2742734
The submission of this lease to Tenant for examination or for signature
shall not be deemed to create or evidence a reservation or option or any other
right in Tenant with respect to the Demised Premises or any other space in the
Building and it is expressly understood that this lease shall not be effective
and neither party shall be bound thereunder unless it is executed and delivered
by both parties.
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RIDER attached to and forming part of LEASE dated as of February 6, 1995
between STANLEY STAHL, d/b/a STAHL PARK AVENUE CO., Owner, and SHOREWOOD
PACKAGING CORPORATION, Tenant,
PREMISES: 277 Park Avenue
Entire 30th Floor
- --------------------------------------------------------------------------------
34. Application of this Rider
A. Rider Provisions Paramount. If and to the extent that any of the
provisions of this Rider conflict or are otherwise inconsistent with any of the
preceding printed provisions of this lease, or of the Rules and Regulations
attached to this lease, whether or not such inconsistency is expressly noted in
this Rider, the provisions of this Rider shall prevail, and in case of
inconsistency with said Rules and Regulations, shall be deemed a waiver of such
Rules and Regulations with respect to Tenant to the extent of such
inconsistency.
B. Additional Definitions. For the purpose of this lease and all
agreements supplemental to this lease, and all communications with respect
thereto, unless the context otherwise requires:
(1) The term "fixed rent" shall mean rent consisting of "base rent"
at the annual rate of:
(i) Nine Hundred Thirty-Six Thousand Four Hundred Fifty Two
Dollars ($936,452) for the period commencing on August 15, 1995 (the
"Rent Commencement Date") and ending on August 14, 2000 ($78,037.66
per month);
(ii) One Million Twenty-One Thousand Five Hundred Eighty-Four
Dollars ($1,021,584) for the period commencing on August 15, 2000 and
ending on August 14, 2005 ($85,132 per month); and
(iii) One Million One Hundred Seventy Thousand Five Hundred
Sixty-Five Dollars ($1,170,565) for the period commencing on August
15, 2005 and ending on the Expiration Date ($97,547.08 per month).
The rentable area of the Demised Premises is agreed to be 21,283 square feet
for all purposes of this lease.
(2) The term "additional rent" shall mean all sums of money, other
than fixed rent, as shall become due and payable front Tenant to Owner
hereunder, and Owner shall have the same remedies therefor as for a default in
payment of fixed rent.
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(3) The terms "rent" and "rents" shall mean and include fixed rent
and/or additional rent and/or escalation rent hereunder.
(4) The terms "Commencement Date" and "Expiration Date" shall mean
the dates fixed in this lease as the beginning and the end of the term for which
the Demised Premises are hereby leased.
(5) Any provision in this lease that one party or the other or both
shall do or do not or shall cause or permit or not cause or permit a particular
act, condition or circumstance shall be deemed to mean that such party so
covenants or both parties so covenant, as the case may be. Tenant's obligations
hereunder shall be construed in every instance as conditions as well as
covenants. Such provisions shall be deemed to mean that if the performance of
the covenant will involve incurrence of expense such expense shall be borne by
the party responsible for such performance except where this lease expressly
provides otherwise.
(6) The term "Tenant" shall mean Tenant herein named or any assignee
or other successor in interest (immediate or remote) of Tenant herein named,
when Tenant herein named or such assignee or other successor in interest, as the
case may be, is in possession of the Demised Premises as owner of the Tenant's
estate and interest granted by this lease, and also, if Tenant is not an
individual or corporation, all of the individuals, firms and/or corporations or
other entities comprising Tenant.
(7) If Owner named herein, or any assignee of the interest of Owner
herein, shall be named as agent, the term "Owner" as used herein shall be deemed
as agent comma the term "Owner" as used herein shall be deemed to include the
principal(s) of such agent, whether disclosed or undisclosed.
(8) Subject to Article 44B, any transfer by operation of law or
otherwise, of Tenant's interest in this lease or of any subtenant's interest in
a sublease hereunder, or, unless Tenant or the subtenant is an entity the
securities of which are registered under appropriate statutory authority and
listed and traded on a national exchange, of a 50% or greater interest in
Tenant, or in a subtenant hereunder (whether stock, partnership interest or
otherwise), in a single transaction or a related series of transactions, shall
be deemed an assignment of this lease within the meaning of Article 11 or an
assignment of the sublease within the meaning of Article 44, as the case may be.
(9) All references in this lease to numbered Articles and lettered
Exhibits are references to Articles of this lease and Exhibits annexed to (and
thereby made part of) this lease, as the case may be, unless expressly otherwise
designated in the context.
(10) The words "include", "including" and "such as" shall each be
construed as if followed by the phrase "without being limited to". The words
"herein", "hereof", "hereby", "hereunder" and words of similar import shall be
construed to refer to this lease as a whole and not to any particular Article or
subdivision thereof unless expressly so stated. The
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rule of ejusdem generis shall not be applicable to limit a general statement
following or referable to an enumeration of specific matters, to matters
similar to the matters specifically mentioned. Words and phrases used in the
singular shall be deemed to include the plural and vice versa and nouns and
pronouns used in any particular gender shall be deemed to include any other
gender, as the sense of the context may permit.
(11) The term "Specialty Tenant's Changes" shall mean Tenant's
Changes (hereinafter defined) consisting of kitchens (excluding pantries),
executive bathrooms (exclusive of the one (1) ADA compliant unisex handicapped
bathroom referred to in Section 47A(2) hereof), raised computer floors which
comprise in excess of two hundred (200) usable square feet, computer
installations (exclusive of wiring), vaults, libraries requiring structural
reinforcement, internal staircases, dumbwaiters, pneumatic tubes, vertical and
horizontal transportation systems, and other Tenant's Changes of a comparable
character.
(12) The term "Initial Tenant's Changes" shall mean the changes made
by Tenant to initially prepare the Demised Premises for Tenant's occupancy.
(13) The term "Requirements" shall mean all present and future laws,
rules, orders, ordinances, regulations, statutes, requirements, codes and
executive orders, extraordinary as well as ordinary, of all governmental
authorities now existing or hereafter created, and of any and all of their
departments and bureaus, and of any applicable fire rating bureau, or other body
exercising similar functions, affecting the Land (hereinafter defined) or any
portion thereof, or any street, avenue or sidewalk comprising a part of or in
front thereof or any vault in or under the same, or requiring removal of any
encroachment, or affecting the maintenance, use or occupation of the Land or any
portion thereof.
(14) The term "Substantial Completion" or "Substantially Completed"
or words of similar import shall mean that Owner's Work has been substantially
completed notwithstanding the fact that minor punch-list or other insubstantial
details of construction or demolition and/or mechanical adjustment and/or minor
or insubstantial decorative items remain to be performed.
C. Some Qualifications of Certain Preceding Printed Articles.
(1) Notwithstanding Tenant's agreement to pay the fixed rent in
lawful money which shall be legal tender, Owner shall accept, subject to
collection, and Tenant shall pay all fixed rent and additional rent falling due
under this lease by currently dated, unendorsed check of Tenant, payable to
Owner or its designed agent and drawn on a bank or trust company which is a
member of the New York Clearing House. Notwithstanding the foregoing, due to the
fact that Nation's Bank is the bank through which Tenant currently conducts its
banking business, Owner shall accept Tenant's checks for fixed rent drawn on
Nation's Bank notwithstanding the fact that Nation's Bank is not a member of the
New York Clearing House, provided, however, if Tenant ceases using Nation's Bank
and changes the bank through which it conducts its banking business, Owner shall
thereafter require that all future checks for fixed rent be paid by check
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drawn on a bank or trust company which is a member of the New York Clearing
House. If Tenant shall default in timely payment of any rent, and whether or
not such default shall be cured, Owner, may by notice given to Tenant at any
time thereafter, require Tenant to make all further rent payments by currently
dated, unendorsed certified or official bank check payable to Owner on a bank
or trust company that is a member of the New York Clearing House.
(2) The use of the Demised Premises for the purposes specified in
Article 2 shall not in any event be deemed to include, and Tenant shall not use,
or permit the use of the Demised Premises or any part thereof for:
(a) the conduct of a public auction of any kind or of any gaming
or gambling activities, or of any political or club activities,
whether private or public;
(b) the conduct of a school of any kind (other than a training
center for employees, or customers or prospective customers of
Tenant);
(c) the conduct of a cafeteria or restaurant other than private
dining facilities for Tenant's officers, employees and business
guests;
(d) the conduct of any business, occupation or activity which,
in the reasonable judgment of Owner, may (i) create or foster an
unusual risk to the security of the Building or of any of its tenants
or occupants, (ii) impair the reputation of the Building for the
highest class of office and commercial uses, or (iii) interfere with
or disturb the occupancy of other tenants in the Building;
(e) the conduct of any business, not engaged in by Tenant at the
date of this lease, if use of the Demised Premises for such business
shall conflict with any negative covenant as to use contained in any
other lease of space in the Building in effect prior to use of the
Demised Premises for such business; and Owner shall advise Tenant,
upon Tenant's request for such information, of the existence of such
negative covenant; or
(f) the conduct of meetings, shows or exhibits for the general
public.
In no event shall the Demised Premises be used or occupied by
anyone (as assignee of this lease or as subtenant or licensee), who shall not
have a financial standing (considering the obligations of Tenant under this
Lease and the financial standing of most other tenants of the Building), or
shall not be of a character, or shall not be engaged in a business, or shall not
use the Demised Premises in a manner, which shall be in keeping with the
standards in such respects of the other office tenancies in the Building.
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(3) Supplementing Article 3:
(a) Tenant shall cause any permitted alterations, decorations,
installations, additions or improvements (herein called " Tenant
Changes"; Tenant's Changes shall also include Initial Tenant's
Changes) in or about the Demised Premises, referred to in Article 3,
to be performed in compliance with all applicable Requirements and in
such manner as not to interfere with, delay, or impose any additional
expense upon Owner in the construction, maintenance or operation of
the Building, or interfere with or disturb the occupancy of other
tenants in the Building, and so as to maintain harmonious labor
relations in the Building. Tenant with reasonable diligence and
dispatch, shall procure the cancellation or discharge of all notices
of violation arising from or otherwise connected with Tenant's
Changes which shall be issued by the Department of Buildings or any
other public authority having or asserting jurisdiction.
(b) Owner shall not unreasonably withhold or delay any consent or
approval required under Article 3 to Tenant's contractor for the
construction of the Tenant's Changes, except Tenant shall select
mechanical and electrical contractors and mechanics from a list of
approved contractors furnished by, Owner to Tenant. The approved list
of contractors for the performance of the Initial Tenant's Changes is
set forth in Exhibit "G". Tenant shall give Owner's building
contractor, Cauldwell - Wingate, Inc. ("Cauldwell") the opportunity
to bid for the performance of Tenant's Changes. Notwithstanding the
foregoing, Tenant shall have no obligation, and Owner shall not
indirectly require Tenant, to select Cauldwell for the performance of
Tenant's Changes. Tenant's contractor shall perform or cause to be
performed Tenant's Changes. Owner hereby approves Structure Tone Inc.
as Tenant's general contractor for the performance of the Initial
Tenant's Changes. Owner may require submission to it of plans and
specifications for any proposed Tenant's Change and in granting its
consent to any Tenant's Change may impose such conditions (in
addition to those expressly provided in this lease) as to guaranty of
completion and payment and of restoration and otherwise as Owner may
reasonably consider desirable. If Owner shall fail to disapprove
Tenant's final plans and specifications for any Tenant's Changes
within ten (10) business days, or within five (5) business days (with
respect to any resubmission of disapproved plans), after Owner's
receipt thereof (provided in each instance the same shall be of a
scope and scale reasonably susceptible of review in such periods),
Owner shall be deemed to have approved such plans and specifications.
Any review or approval by Owner of any plans and/or specifications or
any preparation or design of any plans by Owner's architect or
engineer (or any architect or engineer designated by Owner) with
respect to any Tenant's Changes is solely for Owner's benefit, and
without any representation or warranty whatsoever to Tenant or any
other person with respect to the compliance thereof with any
Requirements, the adequacy, correctness or efficiency thereof or
otherwise. In no event shall Owner be required to consent to any
Tenant's Change which could physically affect any part of the
Building outside of the Demised Premises or might adversely affect
the proper functioning of any of the mechanical, electrical, sanitary
or other service systems of the Building. Owner may require Tenant to
reimburse Owner for Owner's reasonable
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and actual out-of-pocket costs and expenses to unrelated third
parties for (x) review of Tenant's plans and specifications for such
Tenants Change and (y) supervision of compliance with the
requirements of this lease in the performance of such Tenant's
Change.
(c) Notwithstanding the provisions of Article 3, Tenant shall not
be required to restore the Demised Premises to their condition prior
to the making of any Tenant's Change, upon the expiration or earlier
termination of this lease. Notwithstanding the foregoing, however,
Owner, upon approval of Tenant's plans and specifications containing
Specialty Tenant's Changes, shall notify Tenant whether Tenant shall
be required to remove any Specialty Tenant's Changes upon the
expiration of the term of this Lease and if Tenant shall be required
to remove such Specialty Tenant's Changes, Tenant shall restore and
repair the area affected by the removal of such Specialty Tenant's
Changes. All counters, screens, grilles, railings, suspended lighting
fixtures, panelling, business machines and equipment which are
installed in the Demised Premises by or for the account of Tenant,
and can be removed without permanent structural damage to or
defacement of the Building, and all furniture, furnishings and other
articles of personal property owned by Tenant and located in the
Demised Premises (all of which are herein called " Tenant's Property"
shall be and remain the property of Tenant and may be removed by it
at any time during the term of this lease. However, if any of
Tenant's Property is removed, or upon the removal of Specialty
Tenant's Changes, Tenant shall repair or pay the cost of repairing
any damage to the Building resulting from such removal. Any items of
Tenant's Property which shall remain in the Demised Premises after
Tenant surrenders the Demised Premises, at the option of Owner, may
be deemed to have been abandoned, and in such case either may be
retained by Owner as its property or may be disposed of, without
accountability, in such manner as Owner may see fit.
(d) (1) Owner shall, subject to the funding procedures
(including, without limitation, retainage requirements) under the
loan documents entered into with the existing Mortgagee (hereinafter
defined) set forth on Exhibit "F" annexed hereto and made a part
hereof, contribute an amount not to exceed Nine Hundred Fifty-Seven
Thousand Seven Hundred Thirty-Five Dollars ($957,735) (the "Tenant
Fund") toward the cost of the Initial Tenant's Changes, including
architectural and engineering fees.
(2) Owner shall disburse a portion of the Tenant Fund to
Tenant from time to time, within twenty (20) business days after receipt of the
items set forth in Section (C)(3)(d)(3) of Article 34 hereof, provided that on
the date of a request and on the date of disbursement from the Tenant Fund no
event of default shall have occurred and be continuing. Disbursements from the
Tenant Fund shall not be made more frequently than monthly, and shall be in an
amount equal to the aggregate amounts theretofore paid or payable (as certified
by the Chief Financial Officer of Tenant and Tenant's independent, licensed
architect) to Tenant's contractors, subcontractors and material men which have
not been the subject of a previous disbursement from the Tenant Fund multiplied
by a fraction, the numerator of which is
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$957,735 and the denominator of which is the total cost of the Initial Tenant's
Changes as estimated by Tenant's independent licensed architect and as approved
by Owner (which approval shall not be unreasonably withheld), which fraction
shall be subject to readjustment as provided by Section (C)(3)(d)(3) of Article
34 hereof (but in no event shall such fraction be greater than one (1)). Owner
shall notify Tenant in writing of its approval or disapproval of Tenant's
estimate of the total cost of the Initial Tenant's Changes within fifteen (15)
days of Owner's receipt thereof.
(3) Owner's obligation to make disbursements from the Tenant
Fund shall be subject to Owner's verification of the total cost of the Initial
Tenant's Changes as estimated by Tenant's independent licensed architect and
receipt of: (a) a request for such disbursement from Tenant signed by the Chief
Financial Officer of Tenant, together with the certification required by Section
C(3)(d)(2) of Article 34 hereof, (b) an A1A Form G702 and G703 executed by
Tenant's general contractor (which Forms shall require commercially reasonable
retainage requirements), (c) copies of all contracts, work orders, change orders
and other materials relating to the work or materials which are the subject of
the requested disbursement or reimbursement, (d) if requested by Owner, waivers
of lien from all contractors, subcontractors and materialmen involved in the
performance of the Initial Tenant's Changes relating to the portion of the
Initial Tenant's Changes theretofore performed and materials theretofore
provided and for which previous disbursements and/or the requested disbursement
has been or is to be made (except to the extent such waivers of lien were
previously furnished to Owner upon a prior request), and (e) a certificate of
Tenant's independent licensed architect stating (i) that, in his opinion, the
portion of the Initial Tenant's Changes therefore completed and for which the
disbursement is requested was performed in a good and workerlike manner and
substantially in accordance with the final detailed plans and specifications for
such Initial Tenant's Changes, as approved by Owner, (ii) the percentage of
completion of the Initial Tenant's Changes as of the date of such certificate,
and (iii) the revised estimated total cost to complete the Initial Tenant's
Changes. If the revised estimated total cost of the Initial Tenant's Changes
increases above the original estimated total cost of the Initial Tenant's
Changes by more than five percent (5%), then the denominator of the fraction
referred to in Section (C)(3)(d)(2) of Article 34 hereof shall be adjusted
appropriately.
(4) In no event shall the aggregate amount paid by Owner to
Tenant under this Section C(3)(d) of Article 34 hereof exceed the amount of the
Tenant Fund. Upon the completion of the Initial Tenant's Changes and
satisfaction of the conditions set forth in Section C(3)(d)(5) of Article 34
hereof, any amount of the Tenant Fund which has not been previously disbursed
shall be applied by Owner against the next monthly installments of fixed rent
payable hereunder. It is expressly understood and agreed that Tenant shall
complete, at its sole cost and expense, the Initial Tenant's Changes, whether or
not the Tenant Fund is sufficient to fund such completion. Any costs to complete
the Initial Tenant's Changes in excess of the Tenant Fund shall be the sole
responsibility and obligation of Tenant.
(5) Within thirty (30) days after completion of the Initial
Tenant's Changes, Tenant shall deliver to Owner general releases and waivers of
lien from all
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contractors, subcontractors and material men involved in the performance of the
Initial Tenant's Changes and the materials furnished in connection therewith
(unless same previously were furnished pursuant to Section (C)(3)(d)(3) of
Article 34 hereof), and a certificate from Tenant's independent licensed
architect certifying that (i) in his opinion the Initial Tenant's Changes have
been performed in a good and workerlike manner and completed in accordance with
the final detailed plans and specifications for such Initial Tenant's Changes
as approved by Owner and (ii) all contractors, subcontractors and materialmen
have been paid for the Initial Tenant's Changes and materials furnished through
such date. Notwithstanding the foregoing, Tenant shall not be required to
deliver to Owner any general release or waiver of lien if Tenant shall be
disputing in good faith the payment which would otherwise entitle Tenant to
such release or waiver, provided that Tenant shall keep Owner advised in a
timely fashion of the status of such dispute and the basis therefor and Tenant
shall deliver to Owner the general release or waiver of lien when the dispute
is settled. Nothing contained in this Section, however, shall relieve Tenant
from complying with the provisions of Article 3 hereof.
(e) Within a reasonable time after the completion of the Initial
Tenant's Changes, Tenant shall deliver to Owner a full set of
architectural, structural, mechanical and electrical drawings and
specifications showing the Demised Premises "as built" by the
performance of the Initial Tenant's Changes.
(4) Supplementing and modifying Article 13, entry upon the Demised
Premises pursuant to Article 13 shall be accomplished at such times and in such
manner, and upon such reasonable notice, as to minimize to the extent
practicable under the circumstances interference with Tenant's use of the
Demised Premises or inconvenience to Tenant. Except in the case of emergency,
and except for access for cleaning and maintenance and repairs, Tenant shall be
given reasonable opportunity to have a representative of Tenant accompany any
one entering the Demised Premises pursuant to such access. In the case of an
emergency, Owner shall use reasonable efforts to contact Tenant prior to any
forcible entry by Owner pursuant to Article 13.
(5) Supplementing Article 15, Owner represents that to Owner's
knowledge, as of the Commencement Date, the common areas of the Building shall
be in material compliance with all New York City Local Laws and Code so as not
to interfere (except to a de minimis extent) with Tenant's ability to conduct
its business in the Demised Premises.
(6) Supplementing Article 16, insert at the beginning thereof in
place of the first sentence thereof, the following:
"(a) If at or before the date fixed as the Commencement Date of
the term of this lease or if at any time during the term hereby demised:
(i) Tenant shall file a petition commencing a voluntary case
under the Federal Bankruptcy Code (Title 11 of the United States
Code), as now or hereafter in effect, or under similar law, or file a
petition in bankruptcy or for reorganization or for an arrangement
pursuant to any state bankruptcy law or any
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similar state law or, if Tenant is then a banking organization, shall
file an application for voluntary liquidation or dissolution
applicable to banking organizations; or
(ii) an involuntary case against Tenant as debtor is commenced by
a petition under the Federal Bankruptcy Code (Title 11 of the United
States Code), as now or hereafter in effect, or under similar law, or
a petition or answer proposing the adjudication of Tenant as a
bankrupt or its reorganization pursuant to any state bankruptcy law
or any similar state law shall be filed in any court and shall not be
dismissed, discharged or denied within sixty (60) days after the
filing thereof, or if Tenant shall consent or acquiesce in the filing
thereof; or
(iii) a custodian, receiver, United States Trustee, trustee or
liquidator of Tenant or of all or substantially all of Tenant's
property or of Tenant's property in the Demised Premises shall be
appointed in any proceedings brought by Tenant; or if any such
custodian, receiver, United States Trustee, trustee or liquidator
shall be appointed in any proceedings brought against Tenant and
shall not be discharged within sixty (60) days after such
appointment, or if Tenant shall consent to or acquiesce in such
appointment; or
(iv) if Tenant shall generally not pay Tenant's debts as such
debts become due, or shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its debts
generally as they become due; or
(v) if Tenant is then a banking organization, if the
Superintendent of Banks of the State of New York or any other public
officer having like authority and power over Tenant as a banking
organization shall take possession of the business and property of
Tenant at the Demised Premises;
then, Owner may, at its option, cancel or terminate this lease by giving Tenant
written notice to such effect within a reasonable time after receipt of notice
of the happening of any one or more of such events."
(7) Notwithstanding the specific provisions of Article 17:
(a) In case of default in the payment of fixed rent, additional
rent or escalation rent reserved herein, Tenant shall have a grace
period of seven (7) days as long as checks for fixed rent and additional
rent or escalation rent are drawn on Nation's Bank and ten (10) days as
long as checks for fixed rent and additional rent or escalation rent are
drawn on a trust company or bank which is a member of the New York
Clearing House after written notice of the existence of such default
from Owner within which to cure such default and if such payment is not
made before the expiration of such seven
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(7) or ten (10) day grace period, as the case may be, Owner may serve a
five (5) day notice of cancellation of this lease as and with the
effects provided in Article 17(l).
(b) In case of any other default referred to in Article 17(1),
the grace period shall be twenty (20) days (instead of five (5) days)
after written notice of the existence of such default from Owner within
which to cure such default, except where failure to cure within a
shorter period may subject Owner to criminal action or penalty, or where
such default can be cured by payment of money, in either of which cases
the provisions of Article 17(1), as written, shall govern and except,
further, that where any other such default can be completely cured or
remedied in the exercise of due diligence but not within such grace
period of twenty (20) days, such grace period shall be deemed extended
to such period as may be reasonably necessary to do the work or take
such other steps as shall be required to correct such default, provided
Tenant shall have reasonably and diligently commenced during such
default promptly after receipt of written notice thereof and shall
thereafter proceed reasonably and diligently to remedy the same
completely.
(c) Nothing in subparagraph (a) of this paragraph shall be deemed
to require Owner to give the five (5) day notice of cancellation of this
lease provided for therein prior to the commencement of a summary
proceeding for nonpayment of rent or a plenary action for the recovery
of rent on account of any default in the payment of rent, it being
acknowledged and agreed by both parties that the sole purpose of such
notices is to create a conditional limitation hereunder, and in the
event such notices are given by Owner, Tenant shall become a holdover
tenant and this lease shall terminate forthwith at the expiration of the
applicable notice period with the effects provided in Article 17(l).
(8) Supplementing Articles 17 and 18:
(a) Tenant expressly recognizes that Tenant's due and punctual
performance of all its obligations under this lease throughout the term
thereof is of paramount importance to Owner and, without limiting the
provisions of Articles 17 and 34C(7), Tenant agrees that, if Tenant (i)
shall fail to pay for ten (10) business days after it becomes due an
installment of fixed rent or additional rent for two (2) consecutive
months or for a total of four (4) months in any period of twelve (12)
months, or (ii) shall default, beyond applicable grace periods, if any,
in the timely performance of any other obligation of Tenant under this
lease with respect to which Owner shall have given Tenant notice of
default, and such default shall occur more than three (3) times in any
period of six (6) months, then notwithstanding that such failure or
other default shall have been cured within the applicable grace period
provided in said Articles, any further similar default shall be deemed
to be deliberate and Owner thereafter may, without further notice of
default, serve a three (3) day notice of cancellation of this lease as
and with the effects provided in subparagraph (1) of Article 17.
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(b) Instead of the liquidated damages determined pursuant to
Article 18(c), Owner may, at its election, recover from Tenant as
liquidated damages an amount determined pursuant to Article 16(b).
(9) The parties recognize and agree that the damage to Owner
resulting from Tenant's failure to timely surrender the Demised Premises to
Owner will be substantial, will exceed the amount of fixed rent, additional rent
and escalation rent theretofore payable hereunder and will be impossible to
accurately measure. Tenant therefore agrees that if possession of the Demised
Premises is not surrendered to Owner within one (1) day after the Expiration
Date or the sooner expiration of the term of this lease, Tenant shall pay Owner
as liquidated damages for each day during which Tenant holds over in the Demised
Premises after the Expiration Date or earlier expiration of the term of this
lease, a sum equal to two (2) times the average fixed rent, additional rent and
escalation rent which was payable on a per diem basis under this lease on the
last day of the term thereof, Tenant's obligations hereunder shall survive the
Expiration Date or earlier expiration of the term of this lease.
(10) Supplementing Article 27, "requests" or "approvals" by Owner or
Tenant under this lease shall be deemed to be notices. All notices shall be in
writing.
(11) Supplementing Article 28:
(a) Owner shall provide (but subject to recoupment pursuant to
Article 40 hereof) heating, ventilating and air-conditioning (" HVAC")
to the Demised Premises at the times set forth in Article 28 and in a
manner in keeping with first class office buildings. The HVAC system
serving the Demised Premises is designed to perform in accordance with
the specifications set forth on Exhibit "H" annexed hereto and made a
part hereof. The proper performance of the HVAC system serving the
Demised Premises is based upon a maximum population density of one
person per 100 square feet of usable area, a maximum electric heat gain
of 5 watts per square foot of usable area and a supply of .20 CFM of
fresh air per square foot of usable area. Owner shall not be responsible
for the proper performance of such HVAC system if the Demised Premises
(or any room or area thereof) shall be subjected to a greater population
density or a greater heat gain than above specified, if the partitioning
in the Demised Premises shall be rearranged in such manner as to
interfere with the normal operations of the HVAC system in the Demised
Premises, if the windows and the public corridor entrance doors of the
Demised Premises shall not be kept closed, or if the blinds shall not be
lowered in windows of the Demised Premises when exposed to the sun.
Owner shall have free and unrestricted access at reasonable times and
upon reasonable prior notice (except in the case of emergencies) to all
Building HVAC equipment located in or readily accessible only through
the Demised Premises. "Usable area" shall mean the area of the Demised
Premises measured within its demising walls.
(b) If Tenant shall require HVAC service at any time other than
between 8:00 A.M. and 6:00 P.M. on a business day or other than between
9:00 a.m.
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and 1:00 p.m. on Saturdays, Owner shall furnish such service (herein
called " after hours air-conditioning service") upon reasonable advance
notice from Tenant and Tenant shall pay Owner's actual cost therefor on
Owner's demand. Such charges shall not exceed Owner's actual cost of
labor, utilities and supplies used in providing such after hours
air-conditioning service. As of the date hereof, Owner's cost for
providing base Building after hours air-conditioning service is $195 per
hour or part thereof per floor, which rate is subject to change to
reflect any changes in Owner's actual cost for same. If any of the other
tenants of the Building shall receive after hours air conditioning
service, through the same Building HVAC facilities as shall serve the
Demised Premises, pursuant to Owner's obligation to provide the same to
them (whether for a similar charge or without separate charge) at the
same time as Tenant, only a portion of such actual costs as shall be
incurred for such common service, in the ratio of the rentable area of
the Demised Premises to the aggregate rentable area of the Demised
Premises and the premises of such other tenants so served, shall be
included in the costs upon which the charge to Tenant is based.
Otherwise, no adjustment in the charge to Tenant shall be made for other
tenants' use of their premises when after hours air-conditioning service
is being provided to the Demised Premises at Tenant's request. Requests
for after hours service submitted in writing to the Building
Superintendent, by a person designated by Tenant as authorized to make
such requests, before 3:00 P.M. on a non-holiday weekday for such
weekday and before 3:00 P.M. on the day preceding a holiday or weekend
for after hours air-conditioning service on such holiday or weekend,
shall be deemed reasonable advance notice for after hours
air-conditioning service. However, in case of emergency, after hours
air-conditioning service may be obtained by calling the Building
Superintendent in time to enable him to provide the service requested
and promptly following such call with a written confirmation of the
request.
(c) As part of the initial Tenant's Changes, Owner shall not
unreasonably withhold its consent to a Tenant's Change consisting of the
installation of a supplementary air conditioning system of up to
twenty,(20) tons capacity to service the Demised Premises. In connection
therewith, Tenant, at Tenant's sole cost and expense, may tap into the
condenser water risers of the Building to obtain condenser water for the
system. Owner shall furnish to the Demised Premises serviced by such
system condenser water to service such system at such times as Tenant
shall request. Tenant's consumption of condenser water shall be measured
by a BTU meter installed by Owner at Tenant's sole cost and expense, at
the condenser water riser connection. Any installations required to
connect Tenant's supplementary air conditioning system to the condenser
water risers (including, without limitation, the BTU meter referred to
above) shall be made by Owner, at Tenant's sole cost and expense, and
Tenant shall pay to Owner as additional rent Owner's actual
out-of-pocket costs in connection therewith within twenty (20) days of
rendition of a bill therefor. Tenant shall also pay Owner for the supply
of condenser water, within twenty (20) days after rendition of a bill
therefor, a charge of $.35 per ton hour of condenser water consumed.
Such amounts shall be increased on each anniversary of the Commencement
Date so that it equals (i) $.35 plus $.35 multiplied by the percentage
increase, if any, in the Consumer Price Index from that
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in effect on January, 1995. Notwithstanding anything to the contrary
contained herein, Owner has informed Tenant and Tenant acknowledges that
Owner shall not be able to supply condenser water to Tenant's
supplementary air conditioning system until the condenser water riser
for the Building (the "Condenser Water Riser") has been installed. Owner
represents and warrants that the Condenser Water Riser shall be
installed on or before June 1, 1995. Owner shall not be liable to Tenant
for any failure or defect in the supply or character of condenser water
supplied to Tenant by reason of any Requirement, act or omission of the
public service company serving the Building or for any other reason not
attributable to the gross negligence or willful misconduct of Owner, its
agents, contractors and employees.
(d) In keeping the Demised Premises clean, Owner shall provide
cleaning services (including window cleaning) equal in scope, character
and standards to cleaning services then generally provided by landlords
to office tenants of comparable office buildings in the Borough of
Manhattan, City of New York. Such cleaning services in accordance with
such standards currently in effect are described in Exhibit "C".
(e) Owner may, at its option, maintain in the Building either
manually operated elevators or operatorless automatically controlled
elevators or part one and part the other. Owner shall have the right
from time to time during the term of this lease to perform alterations
necessary to change in whole or in part from one to the other without
notice to Tenant and without affecting the obligations of Tenant
hereunder or incurring any liability to Tenant therefor, provided that
such changes shall be made with reasonable speed and diligence and with
minimum inconvenience to Tenant.
(f) Owner shall (i) make up to six (6) points of connection
available for Tenant's Class E system and (ii) at Tenant's sole cost and
expense, reprogram the existing fire alarm system to connect the same to
Tenant's system. The cost and expense of the aforesaid reprogramming
shall be chargeable and collectible as additional rent and paid within
ten (10) days after the rendition of a bill to Tenant therefor.
(12) If Tenant shall fail to pay any installment of fixed rent or any
amount of additional rent for more than ten (10) business days after it shall
have become due and payable, then, whether or not a notice of default has been
given therefor pursuant to the provisions of Article 34C(7)(a), Tenant shall pay
Owner a late charge of five (5) cents for each dollar of the amount of such
fixed rent or additional rent as shall not have been paid to Owner within ten
(10) business days after becoming due and payable. Such late charge shall be
without prejudice to any of Owner's rights and remedies hereunder or at law for
nonpayment or late payment of rent, including interest, and shall be in addition
thereto.
35. Electricity
A. Tenant shall at all times comply with the rules, regulations, terms
and conditions applicable to service, equipment, wiring and requirements of the
public utility supplying
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electricity to the Building. The risers serving the Demised Premises shall
supply six (6) watts demand load of electricity per rentable square foot of the
Demised Premises (it being expressly understood and agreed by Tenant that it
shall be Tenant's responsibility, at its sole cost and expense, to install as
part of the Initial Tenant's Changes any required electrical distribution
equipment, including, without limitation, switches, transformers and panels, in
connection with redistributing such electricity and to perform any work required
to the electrical closets located on the thirtieth (30th) floor in connection
therewith). Tenant shall not use any electrical equipment which, in Owner's
reasonable judgment, would exceed the aforesaid capacity or interfere with the
electrical service to other tenants of the Building. In the event that, in
Owner's reasonable judgment, Tenant's electrical requirements necessitate
installation of an additional riser, risers or other proper and necessary
equipment, Owner shall so notify Tenant of same. Within five (5) business days
after receipt of such notice, Tenant shall either cease such use of such
additional electricity or shall request that additional electrical capacity
(specifying the amount requested) be made available to Tenant. Owner, in Owner's
sole but reasonable judgment shall determine whether to make available such
additional electrical capacity to Tenant and the amount of such additional
electrical capacity to be made available. If Owner shall agree to make available
additional electrical capacity and the same necessitates installation of an
additional riser, risers or other proper and necessary equipment, including,
without limitation, any switchgear, the same shall be installed by Owner. Any
such installation shall be made at Tenant's sole cost and expense, and shall be
chargeable and collectible as additional rent and paid within ten (10) days
after the rendition of a bill to Tenant therefor. Owner shall not be liable in
any way to Tenant for any failure or defect in the supply or character of
electric service furnished to the Demised Premises by reason of any requirement,
act or omission of the utility serving the Building or for any other reason not
attributable to the gross negligence of Owner, whether electricity is provided
by public or private utility or by any electricity generation system owned and
operated by Owner. Owner shall not be liable to Tenant in any way for any
failure or defect in the supply or character of electricity furnished to the
Demised Premises by reason of any requirement, act or omission of the public
utility serving the Building or for any reason not attributable to Owner. Tenant
shall furnish and install, at its expense, all original and replacement lighting
tubes, lamps, bulbs and ballasts required in the Demised Premises. To the extent
(i) permitted by Requirements, (ii) permitted by union requirements and (iii)
considered normal construction practice, Tenant shall be permitted to use BX
cable for the distribution of electricity.
B.(1) Unless Owner is required to have Tenant obtain electricity
from the public utility company furnishing electricity to the Building pursuant
to the provisions of Article 35E hereof, subject to the provisions of Section C
of Article 35 hereof, electricity shall be furnished by Owner to the Demised
Premises and Tenant shall pay to Owner, as additional rent for such service,
during the term of this Lease, an amount (the "Electricity Additional Rent")
calculated pursuant to the rate schedule under which Owner makes payments to the
utility company to provide electricity to the Demised Premises, including all
applicable surcharges, demand charges, time-of-day charges, energy charges, fuel
adjustment charges, rate adjustment charges, taxes and other sums payable in
respect thereof and net of any rebates or credits actually received by Owner in
respect of such electricity supplied to the Demised Premises, based on
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Tenant's demand and/or consumption of electricity (and/or any other method of
quantifying Tenant's use of or demand for electricity as set forth in the
utility company's tariff) as registered on a meter or submeter for purposes of
measuring such demand, consumption or other method of quantifying Tenant's use
of or demand for electricity, (it being agreed that such meter or submeter shall
measure demand and consumption, and off-peak and on-peak use, in either case to
the extent such factors are relevant in making the determination of Owner's
cost). Tenant shall also pay to Owner an amount equal to reasonable and actual
out-of-pocket costs and expenses incurred by Owner to unrelated third parties to
read such electric meters and preparing the submetering bills therefor (such
out-of-pocket costs and expenses shall not exceed five percent (5%) of the
applicable bill for the Electricity Additional Rent). The meter or submeter
shall be installed by Owner, at Owner's sole cost and expense. Owner agrees to
promptly order, and upon receipt, to promptly commence and install such meter or
submeter with due diligence. Owner, at Owner's sole cost and expense (but
subject to recoupment by Owner pursuant to Article 40 hereof), shall maintain
such meter or submeter in good working order. Tenant, from time to time, shall
have the right to review Owner's meter readings, and Owner's calculation of the
Electricity Additional Rent, at reasonable times and on reasonable prior notice,
by giving notice thereof to Owner on or prior to the ninetieth (90th) day after
the date when Owner gives Tenant a bill or statement for the Electricity
Additional Rent.
(2) Where more than one meter measures the electricity supplied
to Tenant, the electricity rendered through each meter may be computed and
billed separately in accordance with the provisions hereinabove set forth. Bills
for the Electricity Additional Rent shall be rendered to Tenant at such time as
Owner may elect, and Tenant shall pay the amount shown thereon to Owner within
ten (10) days after receipt of such bill. Tenant expressly acknowledges that in
connection with the installation of the meters or submeters, the electricity
being supplied to the Demised Premises shall be temporarily interrupted. Owner
shall use reasonable efforts to minimize interference with the conduct of
Tenant's business in connection with such installation; provided, however, that
Owner shall have no obligation to employ contractors or labor at so-called
overtime or other premium pay rates or to incur any other overtime costs or
expenses whatsoever.
C.(1) If, prior to Owner's installation of meters or submeters
and such meters or submeters becoming operational for the purpose of measuring
Tenant's consumption of electricity in the Demised Premises, Tenant shall be
provided access to the Demised Premises or portion thereof for the purpose of
performing Initial Tenant's Changes, Tenant shall pay to Owner a fee (the
"Electricity Fee") in consideration of Owner furnishing electricity to the
Demised Premises for construction lighting and for power for normal construction
tools. The Electricity Fee shall only be payable with respect to the period
prior to Owner's installation of meters and submeters in the Demised Premises
and such meters or submeters becoming operational. Upon such installation by
Owner, and thereafter, Tenant shall pay Electricity Additional Rent based upon
the demand and consumption shown on such meters or submeters, as more
particularly set forth in Section B of Article 35 hereof. The Electricity Fee
shall be an amount equal to the product of (x) Twenty-Nine and 15/100 Dollars
($29.15) (provided, however, that if Owner shall provide Tenant with access to
less than the entire Demised
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Premises, the Electricity Fee shall be proportionately reduced based on the area
of the Demised Premises to which Tenant has been given access), and (y) the
number of calendar days on which Tenant shall have access to the Demised
Premises or portion thereof for the purpose of performing Initial Tenant's
Changes. Owner shall render a bill to Tenant for such Electricity Fee from time
to time, but not more frequently than monthly, and Tenant shall pay such
Electricity Fee to Owner, as additional rent, within ten (10) days after receipt
of such bill.
(2) If Tenant shall occupy the Demised Premises, or any portion
thereof, for the conduct of its business (as opposed to for the performance of
Initial Tenant's Changes) prior to Owner's installation of such meters or
submeters in any portion of the Demised Premises so occupied and such meters or
submeters becoming operational, Tenant shall pay the Electricity Inclusion
Charge (hereinafter defined), rather than the Electricity Fee, for such portion
of the Demised Premises with respect to the period prior to the date such meters
or submeters are installed and operational. Upon such installation by Owner, and
thereafter and such meters or submeters becoming operational, Tenant shall pay
Electricity Additional Rent pursuant to Section B of Article 35 hereof.
D. If prior to the installation of the electric meters or
submeters in the Demised Premises and such meters or submeters becoming
operational, Tenant shall occupy all or any portion of the Demised Premises for
the conduct of business, Owner shall furnish electric current to the Demised
Premises on a "rent inclusion" basis, until said meters or submeters are
installed and operational. The fixed rent set forth in this Lease does not
include a charge for such electric service. Accordingly, Tenant shall pay to
Owner on the first day of each month during such inclusion period, in the same
manner as fixed rent is payable hereunder, an amount equal to Four Thousand
Eight Hundred Seventy-Seven and 35/100 Dollars ($4,877.35) (the "Electricity
Inclusion Charge"). If such inclusion period shall commence on a date other than
the first (lst) day of any calendar month, Tenant shall pay to Owner on the date
such inclusion period commences an amount equal to the product of (i) One
Hundred Sixty and 35/100 Dollars ($160.35), and (ii) the number of calendar days
in the period from the beginning of such inclusion period to the last day of the
month in which such date shall occur, both dates inclusive. If Owner is
supplying electricity to only a portion of the Demised Premises on a "rent
inclusion" basis as aforesaid, the Electricity Inclusion Charge shall be
proportionately reduced based on the area of the Demised Premises being supplied
with electricity on a "rent inclusion" basis. The parties agree that although
the charge for furnishing electrical energy is reflected in the Electricity
Inclusion Charge on a so called "rent inclusion" basis, the value to Tenant of
such service may not be accurately reflected in such Electricity Inclusion
Charge. Accordingly, Owner and Tenant agree that after the meters and/or
submeters are installed and operational and electricity is being furnished to
such portion of the Demised Premises pursuant to Section B of Article 35 hereof
for a twelve (12) month period, the Electricity Inclusion Charge shall be
adjusted based on the average of the Electricity Additional Rent ("Twelve Month
Average") payable by Tenant for such twelve (12) month period with respect to
the portion of the Demised Premises which was previously being furnished with
electricity on a "rent inclusion" basis. If the Twelve Month Average shall
exceed the Electricity Inclusion Charge, Tenant, within ten (10) business days
after demand therefor, shall pay such excess to Owner, and if the Electricity
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Inclusion Charge shall exceed the Twelve Month Average, Owner, at its option,
shall either promptly refund to Tenant such excess or shall credit such excess
against immediately subsequent monthly installments of fixed rent next becoming
due and payable hereunder.
E. Owner reserves the right to discontinue furnishing electricity to
Tenant in the Demised Premises if required pursuant to Requirements or as may be
required by the public utility serving the Building. If Owner is compelled to
discontinue furnishing electricity to Tenant, this lease shall continue in full
force and effect and shall be unaffected thereby, except only that from and
after the effective date of such discontinuance, Owner shall not be obligated to
furnish electricity to Tenant. If Owner so discontinues furnishing electricity
to Tenant, Tenant shall arrange to obtain electricity directly from the public
utility serving the Building. Such electricity may be furnished to Tenant by
means of the then existing Building system feeders, risers and wiring to the
extent that the same are available, suitable and safe for such purposes. All
meters and all additional panel boards, feeders, risers, wiring and other
conductors and equipment which may be required to obtain electricity of
substantially the same quantity, quality and character, directly from such
public utility shall be installed by Owner at Tenant's expense.
F. The provisions of this Article 35 are subject to any requirements
or demands imposed by the public utility serving the Building which are
applicable to all tenants of the Building.
36. Superior Leases and Mortgages
A. This Lease shall be subject and subordinate to each and every
superior lease and/or to each and every mortgage affecting the Land or the
Building. The holder of a mortgage is hereinafter referred to as "Mortgagee" and
the holder of a superior lease is hereinafter referred to as "Lessor". Owner
agrees after the execution and delivery hereof to obtain from (1) the current
Mortgagee an agreement to the effect that, if there shall be a foreclosure of
its mortgage, such Mortgagee will not make Tenant a party defendant to such
foreclosure, evict Tenant, disturb Tenant's possession under this Lease, or
terminate or disturb Tenant's leasehold estate or rights hereunder, and will
recognize Tenant as the direct tenant of such Mortgagee on the same terms and
conditions as are contained in this Lease, subject to the provisions hereinafter
set forth, provided no event of default shall have occurred and be continuing
hereunder beyond the applicable notice and cure period, if any, and (2) the
current Lessor an agreement to the effect that if its superior lease shall
terminate or be terminated for any reason, Lessor will not evict Tenant, disturb
Tenant's possession under the Lease, or terminate or disturb Tenant's leasehold
estate or rights hereunder, and will recognize Tenant as the direct tenant of
such Lessor on the same terms and conditions as are contained in this Lease
(subject to the provisions hereinafter set forth), provided no event of default
shall have occurred and be continuing beyond the applicable notice and cure
period, if any, and Lessor shall not make Tenant a party in any action to
terminate such superior lease or to remove or evict Tenant from the Demised
Premises provided no event of default shall have occurred and be continuing
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beyond the applicable notice and cure period, if any (any such agreement, or
any agreement of similar import, from a Mortgagee or a Lessor, as the case may
be, being hereinafter referred to as a "Nondisturbance Agreement"). This
clause shall be self-operative and no further instrument of subordination shall
be required from Tenant to make the interest of any Lessor or Mortgagee
superior to the interest of Tenant hereunder. Tenant, however, at Tenant's
sole cost and expense, shall execute and deliver promptly the Nondisturbance
Agreement or any other instrument, in recordable form, that Owner, any
Mortgagee or Lessor may request in confirmation of such subordination. Tenant
shall not do anything that would constitute a default under any superior lease
or mortgage, or omit to do anything that Tenant is obligated to do under the
terms of this Lease so as to cause Owner to be in default thereunder. If the
date of expiration of any superior lease shall be the same day as the
Expiration Date, the term shall end and expire twelve (12) hours prior to the
expiration of the superior lease. If, in connection with the financing of the
Land (hereinafter defined), the Building or the interest of the lessee under
any superior lease, or if in connection with the entering into of a superior
lease, any lending institution or Lessor shall request reasonable modifications
of this Lease that do not increase Tenant's monetary obligations under this
Lease, or adversely affect or diminish the rights (except to a de minimis
extent), or increase the other obligations of Tenant under this Lease (except
to a de minimis extent), Tenant shall make such modifications.
B. Any Nondisturbance Agreement may be made on the condition that
neither the Mortgagee nor the Lessor, as the case may be, nor anyone claiming
by, through or under such Mortgagee or Lessor, as the case may be, including a
purchaser at a foreclosure sale, shall be:
(i) liable for any act or omission of or default by any
prior landlord (including, without limitation, the
then defaulting Owner), or
(ii) subject to any defense or offsets which Tenant may
have against any prior landlord (including, without
limitation, the then defaulting Owner), or
(iii) bound by any payment of rental which Tenant may have
made to any prior landlord (including, without
limitation, the then defaulting Owner) more than
thirty (30) days in advance of the date upon which
such payment was due (all such prepaid rental shall
remain due and owing without regard to such payment),
or
(iv) bound by any obligation to make any payment to or on
behalf of Tenant, or to make any payments on account
of any Tenant Fund, or
(v) bound by any obligation to perform any work or to
make improvements to the Demised Premises, except
for (i) repairs and maintenance pursuant to the
provisions of Article 4 hereof, the need for which
repairs and maintenance first arises after the date
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upon which such owner, Lessor, or Mortgagee shall be entitled to possession of
the Demised Premises, (ii) repairs to the Demised Premises or any part thereof
as a result of damage by fire or other casualty pursuant to Article 9 hereof,
but only to the extent that such repairs can be reasonably made from the net
proceeds of any insurance actually made available to such Lessor or Mortgagee,
and (iii) repairs to the Demised Premises as a result of a partial condemnation
pursuant to Article 10 hereof, but only to the extent that such repairs can be
reasonably made from the net proceeds of any award made available to such
Lessor or Mortgagee, or
(vi) bound by any amendment, modification or cancellation of
this Lease or surrender of the Demised Premises made
without its prior written consent, or
(vii) bound to return Tenant's security deposit or Letter of
Credit (hereinafter defined), if any, until such
deposit or Letter of Credit has come into its actual
possession and Tenant would be entitled to such
security deposit or Letter of Credit pursuant to the
terms of this Lease.
The provisions of this Section B of Article 36 shall enure to the benefit of any
such owner, Lessor or Mortgagee, shall apply notwithstanding that, as a matter
of law, this Lease may terminate upon the termination of any superior lease, and
shall be self-operative upon any such demand, and no further instrument shall
be required to give effect to said provisions. Tenant, however, upon demand of
any such owner, Lessor or Mortgagee, shall execute, at Tenant's expense, from
time to time, instruments, in recordable form, in confirmation of the foregoing
provisions of this Section B of Article 36 hereof, satisfactory to any such
owner, Lessor or Mortgagee, acknowledging such attornment and setting forth the
terms and conditions of its tenancy. Nothing contained in this Section D shall
be construed to impair any right otherwise exercisable by any such owner, Lessor
or Mortgagee. Notwithstanding the provisions of this Section B of Article 36
hereof, this Lease shall not terminate by reason of the termination of any
superior lease without the prior written consent of the Mortgagee of the
mortgage which is a first mortgage on Owner's interest in the Land or the
leasehold estate created by such superior lease.
C. If required by the Mortgagee or the Lessor, within seven (7) days
after notice thereof, Tenant shall join in any Nondisturbance Agreement to
indicate its concurrence with the provisions thereof and its agreement set forth
in Section D of Article 36 hereof to attorn to such Mortgagee or Lessor, as the
case may be, as Tenant's landlord hereunder. Tenant shall promptly so accept,
execute and deliver any Nondisturbance Agreement proposed by any such Mortgagee
or Lessor which conforms to the provisions of this Article 36. Any such
Nondisturbance Agreement may also contain other terms and conditions as may
otherwise be reasonably required by such Mortgagee or Lessor, as the case may
be, which do not increase Tenant's monetary obligations under this Lease, or
adversely affect or diminish the rights (except to a de minimis extent), or
increase the other obligations of Tenant under this Lease (except to a de
minimis extent).
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D. If at any time prior to the expiration of the term, any superior
lease shall terminate or be terminated for any reason or any Mortgagee comes
into possession of the Land or the Building or the estate created by any
superior lease by receiver or otherwise, Tenant agrees, at the election and upon
demand of any owner of the Land or the Building, or of the Lessor, or of any
Mortgagee in possession of the Land or the Building, to attorn, from time to
time, to any such owner, Lessor or Mortgagee or any person acquiring the
interest of Owner as a result of any such termination, or as a result of a
foreclosure of the Mortgage or the granting of a deed in lieu of foreclosure,
upon the then executory terms and conditions of this Lease, subject to the
provisions of Section A and Section B of Article 36 hereof, for the remainder of
the term, provided that such owner, Lessor or Mortgagee, as the case may be, or
receiver caused to be appointed by any of the foregoing, shall then be entitled
to possession of the Demised Premises. The provisions of this Section D of
Article 36 shall enure to the benefit of any such owner, Lessor or Mortgagee,
shall apply notwithstanding that, as a matter of law, this Lease may terminate
upon the termination of any superior lease, and shall be self-operative upon any
such demand, and no further instrument shall be required to give effect to said
provisions. Tenant, however, upon demand of any such owner, Lessor or Mortgagee,
shall execute, at Tenant's expense, from time to time, instruments, in
recordable form, in confirmation of the foregoing provisions of this Section D
of Article 36, satisfactory to any such owner, Lessor or Mortgagee,
acknowledging such attornment and setting forth the terms and conditions of its
tenancy. Nothing contained in this Section D shall be construed to impair any
right otherwise exercisable by any such owner, Lessor or Mortgagee.
E. As long as any Superior Lease or Mortgage shall exist, Tenant shall
not seek to terminate this Lease by reason of any act or omission of Owner until
Tenant shall have given written notice of such act or omission to all Lessors
and Mortgagees at such addresses as shall have been furnished to Tenant by such
Lessors and Mortgagees and, if any such Lessor or Mortgagee, as the case may be,
shall have notified Tenant within ten (10) business days following receipt of
such notice of its intention to remedy such act or omission, until a reasonable
period of time shall have elapsed following the giving of such notice, during
which period such Lessors and Mortgagees shall have the right, but not the
obligation, to remedy such act or omission.
F. Tenant hereby irrevocably waives any and all right(s) it may have in
connection with any zoning lot merger or transfer of development rights with
respect to the Land including, without limitation, any rights it may have to be
a party to, to contest, or to execute, any Declaration of Restrictions (as such
term is defined in Section 12-10 of the Zoning Resolution of The City of New
York effective December 15, 1961, as amended) with respect to the Land, which
would cause the Demised Premises to be merged with or unmerged from any other
zoning lot pursuant to such Zoning Resolution or to any document of a similar
nature and purpose, and Tenant agrees that this Lease shall be subject and
subordinate to any Declaration of Restrictions or any other document of similar
nature and purpose now or hereafter affecting the real property. In confirmation
of such subordination and waiver, Tenant shall execute and deliver promptly any
certificate or instrument that Owner reasonably may request.
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37. Estoppel Certificate
Each party shall, at any time and from time to time, at the request
of the other party, upon not less than ten (10) days' notice, execute and
deliver to the other a statement certifying 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 the modification(s)],
certifying the dates to which the fixed rent, additional rent and escalation
rent have been paid, and stating whether or not, to the best knowledge of the
signer, the other party is in default in performance of any of its obligations
under this lease, and, if so, specifying each such default of which the signer
may have knowledge, it being intended that any such statement delivered pursuant
hereto may be relied upon by others with whom the party requesting such
certificate may be dealing.
38. Indemnification and Liability of Owner
A. Tenant shall indemnify and save harmless Owner against and from (a)
any and all claims (i) arising from (x) the conduct of business in or management
(other than by Owner) of the Demised Premises or (y) any work or thing
whatsoever done, or any condition created (other than by Owner) in or about the
Demised Premises during the term of this lease or during the period of time, if
any, prior to the Commencement Date that Tenant may have been given access to
the Demised Premises pursuant to this lease, or (ii) arising from any act or
omission of Tenant or any of its subtenants or licensees or its or their
employees, agents or contractors, and (b) all out-of-pocket third party costs,
expenses and liabilities incurred in or in connection with each such claim or
action or proceeding brought thereon. In case any action or proceeding be
brought against Owner by reason of any such claim, Tenant, upon written notice
from Owner, shall resist and defend such action or proceeding by counsel chosen
by Tenant who shall be reasonably satisfactory to Owner. Tenant or its counsel
shall keep Owner fully apprised at all times of the status of such defense.
Counsel for Tenant's insurer shall be deemed satisfactory to Owner.
B. Tenant shall look only to Owner's estate(s) in the Land and Building
(or the proceeds thereof) and, if and to the extent expressly provided for in
this lease, offset against the rents payable under this lease, for the
satisfaction of Tenant's remedies for the collection of any judgment (or other
judicial process) requiring the payment of money by Owner in the event of any
default by Owner under this lease, and no other property or other assets of
Owner shall be subject to levy, execution or other enforcement procedure for the
satisfaction of Tenant's remedies under or with respect to this lease, the
relationship of landlord and tenant hereunder or Tenant's use and occupancy of
the Demised Premises.
39. Escalation for Increase in Real Estate Taxes
A. As used herein:
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(1) "Taxes" shall mean the real estate taxes and assessments
imposed upon the land on which the Building is erected (the "Land") and the
Building or which would have been imposed on any portion of the Land and/or the
Building had such portion of the Land and/or the Building not been exempt from
such taxes by reason of its ownership by a governmental or similar agency which
is providing public or similar inducements to a particular tenant or tenants of
the Building. Taxes shall also include, without limitation, items such as the
portion of Taxes attributable to the applicable Business Improvement District
and the Safe Street Program. Penalties and interest on Taxes, and income,
franchise, transfer, inheritance and capital stock taxes shall be deemed
excluded from the term Taxes for the purposes hereof. However, if and to the
extent that, due to a change in the method of assessment or taxation, any
franchise, capital stock, capital, rents, income, profits or other tax or charge
shall be substituted for the Taxes now or hereafter imposed upon said Land and
the Building, such franchise, capital stock, capital, rents, income, profits or
other tax or charge, computed as if Owner owned or operated no property other
than said Land and the Building, shall be deemed included in the term Taxes for
the purposes hereof. Notwithstanding the foregoing, the portion of the real
estate taxes presently imposed upon the Land and Building which are attributable
to the atrium on the Park Avenue side of the Building ("Atrium Taxes"), which
atrium will be removed, shall not be included in Taxes for any purposes of this
Lease (including, without limitation, the Base Tax). The Atrium Taxes shall be
determined on the basis of a tax bill or other documentation furnished by the
appropriate government agency.
(2) "Tax Year" shall mean a fiscal or calendar year for which
Taxes shall be imposed and falling partly or wholly within the term of this
lease.
(3) "Base Tax" shall mean the Taxes for the tax year July 1, 1995
through June 30, 1996 (excluding the Atrium Taxes for such Tax Year).
(4) "Tenant's Proportionate Tax Share" shall mean a fraction of
which the numerator is the rentable area of the Demised Premises and the
denominator is the total rentable area of the Building. For the purposes of
this lease the rentable areas of the Demised Premises and of the Building shall
be deemed to be 21,283 square feet and 1,744,590 square feet, respectively, and
Tenant's Tax Proportionate Share may be expressed as a percentage (i.e.,
1.2199%).
B. If the Taxes for any Tax Year occurring after June 30, 1996 shall be
greater than the Base Tax, Tenant shall pay as additional rent for such Tax Year
a sum equal to Tenant's Proportionate Tax Share of the amount by which the Taxes
for such Tax Year are greater than the Base Tax (which amount is hereinafter
called the ("Tax Payment"). Should this lease commence or terminate prior to the
expiration of a Tax Year, such Tax Payment shall be prorated to, and shall be
payable on, or as and when ascertained after, the Commencement Date or the
Expiration Date, as the case may be. Tenant's obligation to pay such additional
rent and Owner's obligation to refund pursuant to Section C below, as the case
may be, shall survive the termination of this lease. If the Taxes for any Tax
Year, or an installment thereof, shall be reduced before such Taxes, or such
installment, shall be paid, the amount of Owner's reasonable costs and expenses
of obtaining such reduction (but not exceeding the amount of such reduction)
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shall be added to and be deemed part of the Taxes for such Tax Year. Payment
of additional rent for any Tax Payment due from Tenant shall be made as and
subject to the conditions hereinafter provided in this Article.
C. Owner shall be under no obligation to contest the Taxes or the
assessed valuation of the Land and the Building for any Tax Year or to refrain
from contesting the same, and may settle any such contest on such terms as Owner
in its sole judgment considers proper. If Owner shall receive a refund for any
Tax Year for which a Tax Payment shall have been made by Tenant pursuant to
Section B above, Owner shall repay to Tenant, with reasonable promptness,
Tenant's Proportionate Tax Share of such refund and of any interest received,
thereon after deducting from such refund and interest the reasonable costs and
expenses (including experts' and attorneys' fees) of obtaining such refund. If
the Base Tax shall be reduced from the amount originally imposed after Owner
shall have rendered a Tax Statement (as provided in Section D below) to Tenant
with respect to a Tax Year, the amount of the Tax Payment shall be adjusted in
accordance with such change and Tenant, on Owner's demand, shall pay any
increase in additional rent resulting from such adjustment.
D. At any time during a Tax Year after the Taxes for such Tax Year
become known Owner may, or else with reasonable promptness after the end of such
Tax Year, Owner shall, render to Tenant a comparative statement (the "Tax
Statement") showing the amount of the Base Tax, the amount of the Taxes for such
Tax Year and the Tax Payment, if any, due from Tenant for such Tax Year,
indicating thereon in reasonable detail the computation of such Tax Payment. The
Tax Payment shown on the Tax Statement may, at Owner's option, be payable in two
(2) semiannual installments or in such installments (not more frequently than
monthly) as Owner may determine. Tenant shall pay the amount of the Tax Payment
shown on the Tax Statement (or the balance or a proportionate installment
thereof, if only an installment is involved) concurrently with the installment
of fixed rent then or next due provided Tenant shall have at least twenty (20)
days from receipt of the Tax Statement to make such payment, or if the Tax
Statement shall be rendered at or after the termination of this lease within
thirty (30) days after such rendition. Whenever so requested, not more often
than once a year, Owner shall furnish Tenant with a reproduced copy of the bill
(or receipted bill) for the Taxes for the current or next preceding Tax Year.
E. The Tax Statement for a Tax Payment for any Tax Year shall be
conclusive and binding upon Tenant unless (i) within thirty (30) days after
receipt of the Tax Statement, Tenant shall notify Owner that it disputes the
correctness thereof, specifying the respect(s) in which the Tax Statement is
claimed to be incorrect and (ii) if such dispute shall not have been settled by
agreement, Tenant shall submit the dispute to informal arbitration pursuant to
Article 43 within sixty (60) days after receipt of the Tax Statement. Pending
the determination of such dispute by agreement or arbitration as aforesaid,
Tenant shall pay the additional rent in accordance with the Tax Statement and
such payment shall be without prejudice to Tenant's position. If the dispute
shall be determined in Tenant's favor, Owner shall forthwith pay Tenant, or, at
Owner's election, Tenant shall be entitled to credit against rents then or
thereafter due hereunder, the amount of Tenant's overpayment of rents resulting
from compliance with the Tax Statement.
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To the extent such incorrect Tax Statement was due to a mistake of Owner (as
opposed to a third party such as the taxing authority) Tenant shall be entitled
to interest on the amount of the overpayment at 2% over the Base Rate
(hereinafter defined) calculated from the date of overpayment to the date such
payment is refunded to Tenant.
40. Escalation for Operating Expenses
A. As used herein:
(1) "Base Operating Expenses" shall mean the Operating Expenses
for the Base Operating Year.
(2) "Base Operating Year" shall mean the calendar year ending
December 31, 1995.
(3)(A) "Operating Expenses" shall mean the aggregate of those costs
and expenses (and taxes, if any, thereon, including without limitation, sales
and value added taxes, if applicable) paid or incurred by or on behalf of Owner
(whether directly or through independent contractors) in respect of the
operation of the Land and Building which, are properly chargeable to the
operation of the Land and Building together with and including (without
limitation) the costs of gas, oil, steam, water, sewer rental, electricity (for
the portions of the Land and Building not leased to and occupied by tenants or
available for occupancy), HVAC and other utilities furnished to the Land and the
Building and utility taxes, and the expenses incurred in connection with the
operation of the property such as insurance premiums, reasonable attorneys' fees
and disbursements (exclusive of any such fees and disbursements incurred in
applying for any reduction of Taxes) and auditing and other professional fees
and expenses incurred and attributable solely to the Building, but specifically
excluding:
(i) Taxes,
(ii) franchise or income taxes imposed upon Owner,
(iii) debt service on mortgages,
(iv) leasing commissions,
(v) capital improvements (except as otherwise provided
herein),
(vi) the cost of electrical energy furnished directly to
Tenant and other tenants of the Building and the cost incurred by Owner in
connection with reading such meters and/or submeters,
(vii) the cost of tenant installations incurred in connection
with preparing space for a new tenant,
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(viii) salaries of personnel above the grade of building
manager and such building manager's supervisor,
(ix) rent paid under superior leases (other than in the
nature of rent consisting of Operating Expenses),
(x) any expense for which Owner is otherwise compensated
through the proceeds of insurance or is otherwise compensated by any tenant
(including Tenant) of the Building for services in excess of the services Owner
is obligated to furnish to Tenant hereunder.
(xi) legal fees incurred in connection with any negotiation
of, or disputes arising out of, any space lease in the Building,
(xii) depreciation, except as provided herein,
(xiii) Owner's advertising and promotional costs for the
Building,
(xiv) financing and refinancing costs,
(xv) the portion of the expense incurred in connection with
furnishing services for any tenant of the Building in excess of the services
Owner is obligated to furnish to Tenant hereunder without additional payment by
Tenant,
(xvi) any interest, fine, penalty or other late charges
payable by Owner, incurred as a result of late payments, except to the extent
the same (a) was due solely to action or inaction on another unrelated party's
part (e.g. penalties accrued on unpaid amounts of an invoice or bill which
Owner, acting in accordance with a commercially reasonable standard, did not
receive or did not receive in a timely manner) or (b) was with respect to a
payment, part or all of which, was the responsibility of Tenant hereunder and
with respect to which Tenant did not make in a timely fashion or did not make at
all;
(xvii) the cost paid or incurred in connection with the
removal, replacement, enclosure, encapsulation or other treatment of any
asbestos in the Building (other than periodic ongoing monitoring of asbestos,
but excluding any monitoring required during any such removal, replacement,
enclosure, encapsulation or other treatment), and
(xviii) to the extent any costs relating to uniforms, tools
and supplies are incurred with respect to such items which are used both at the
Building and other properties owned by Owner, there shall be excluded from
Operating Expenses a fair and reasonable percentage thereof which is properly
allocable to such other properties, except, however, that (i) if Owner is not
furnishing any particular work or service (the cost of which if performed by
Owner would constitute an Operating Expense) to a tenant who has undertaken to
perform such work or service in lieu of the performance thereof by Owner, or
(ii) if less than ninety-five
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percent (95%) of the rentable area of the Building shall have been occupied by
tenant(s) at any time during any such Operating Year, Operating Expenses shall
be deemed to be increased by an amount equal to the additional Operating
Expenses which reasonably would have been incurred during such period by Owner
(i) if it had at its own expense furnished such work or services to such tenant
or (ii) had ninety-five percent (95 %) of the rentable area of the Building
been occupied throughout such Operating Year, as the case may be. Any
insurance proceeds received with respect to any item previously included as an
Operating Expense shall be deducted from Operating Expenses for the Operating
Year (hereinafter defined) in which such proceeds are received; provided,
however, to the extent any insurance proceeds are received by Owner in any
Operating Year with respect to any item which was included in Operating
Expenses during the Base Operating Year, the amount of insurance proceeds so
received shall be deducted from Base Operating Expenses and (x) the Base
Operating Expenses shall be retroactively adjusted to reflect such deduction
and (y) all retroactive Operating Payments (hereinafter defined) resulting from
such retroactive adjustment shall be due and payable when billed by Owner.
(B) Intentionally Omitted
(C) (i) If any capital improvement is made during any Operating
Year in compliance with a Requirement, whether or not such Requirement is valid
or mandatory, or in lieu of a repair, then the cost of such improvement shall be
included in Operating Expenses for the Operating Year in which such improvement
was made; provided, however, to the extent the cost of such improvement is
required to be capitalized for federal income tax purposes, such cost shall be
amortized over the useful economic life of such improvement as reasonably
estimated by Owner, and the annual amortization, together with interest thereon
at the rate of interest publicly announced from time to time by the Chase
Manhattan Bank, N.A., or its successor, as its "prime lending rate" (the "Base
Rate"), of such improvement shall be deemed an Operating Expense in each of the
Operating Years during which such cost of the improvement is amortized.
(ii) If any capital improvement is made during any Operating
Year either for the purpose of saving or reducing Operating Expenses (as, for
example, a labor-saving improvement), then the cost of such improvement shall be
included in Operating Expenses for the Operating Year in which such improvement
was made; provided, however, such cost shall be amortized over such period of
time as Owner reasonably estimates such savings or reduction in Operating
Expenses will equal the cost of such improvement and the annual amortization,
together with interest thereon at the then Base Rate, of such improvement shall
be deemed an Operating Expense in each of the Operating Years during which such
cost of the improvement is amortized.
(4) "Operating Statement" shall mean a statement in reasonable
detail setting forth a comparison of the Operating Expenses for an Operating
Year with the Base Operating Expenses and the escalation rent for the preceding
Operating Year pursuant to the provisions of this Article 40.
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(5) "Operating Year" shall mean the calendar year within which
the Commencement Date occurs and each subsequent calendar year for any part or
all of which escalation rent shall be payable pursuant to this Article 40.
(6) "Tenant's Proportionate Share" shall mean a fraction of which
the numerator is the rentable area of the Demised Premises and the denominator
is the total rentable area of the Building. For purposes of this lease the
rentable areas of the Demised Premises and the Building shall be deemed to be
21,283 square feet and 1,684,990 square feet, respectively, and Tenant's
Proportionate Share may be expressed as a percentage (i.e. 1.2630%).
B. (1) If the Operating Expenses for any Operating Year (any part or
all of which falls within the term from and after the Rent Commencement Date)
shall be greater than the Base Operating Expenses, then Tenant shall pay as
additional rent for such Operating Year and continuing thereafter until a new
Operating Statement is rendered to Tenant, Tenant's Proportionate Share of such
increase (the "Operating Payment") as hereinafter provided.
(2) At any time during or after the term Owner may render to
Tenant an Operating Statement or Statements certified by the chief financial
officer of Owner or the functional equivalent of the chief financial officer of
Owner showing (i) a comparison of the Operating Expenses for the Operating Year
in question with the Base Operating Expenses, and (ii) the amount of the
Operating Payment resulting from such comparison. Owner's failure to render an
Operating Statement during or with respect to any Operating Year in question
shall not prejudice Owner's right to render an Operating Statement during or
with respect to any subsequent Operating Year, and shall not eliminate or reduce
Tenant's obligation to make payments of the Operating Payment pursuant to this
Article 40 for such Operating Year.
(3) On the first day of the month following the furnishing to
Tenant of an Operating Statement, Tenant shall pay to Owner a sum equal to
1/12th of the Operating Payment shown thereon to be due for the preceding
Operating Year multiplied by the number of months (and any fraction thereof) of
the term then elapsed since the commencement of such Operating Year in which
such Operating Statement is delivered, less Operating Payments theretofore made
by Tenant for such Operating year and thereafter, commencing with the then
current monthly installment of fixed rent and continuing monthly thereafter
until rendition of the next succeeding Operating Statement, Tenant shall pay on
account of the Operating Payment for such Year an amount equal to 1/12th of the
Operating Payment shown thereon to be due for the preceding Operating Year. Any
Operating Payment shall be collectible by Owner in the same manner as fixed
rent.
(4) (i) As used in this Section B(4) of Article 40(i) "Tentative
Monthly Escalation Charge" shall mean a sum equal to 1/12th of the product of
(a) Tenant's Proportionate Share, and (b) the difference between (x) the Base
Operating Expenses and (y) Owner's estimate of Operating Expenses for the
Current Year, and (ii) "Current Year" shall mean the Operating Year in which a
demand is made upon Tenant for payment of a Tentative Monthly Escalation Charge.
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(ii) At any time in any Operating Year, Owner, at its option,
in lieu of the payments required under Section B(3) of Article 40 hereof, may
demand and collect from Tenant, as additional rent, a sum equal to the Tentative
Monthly Escalation Charge multiplied by the number of months in said Operating
Year preceding the demand and reduced by the sum of all payments theretofore
made under Section B(3) of Article 40 hereof with respect to said Operating
Year, and thereafter, commencing with the month in which the demand is made and
continuing thereafter for each month remaining in said Operating Year, the
monthly installments of fixed rent shall be deemed increased by the Tentative
Monthly Escalation Charge. Any amount due to Owner under this Section B(4) of
Article 40 may be included by Owner in any Operating Statement rendered to
Tenant as provided in Section B(2) of Article 40 hereof.
(5) (i) After the end of the Current Year and at any time that
Owner renders an Operating Statement or Statements to Tenant as provided in
Section B(2) of Article 40 hereof with respect to the comparison of the
Operating Expenses for said Operating Year or Current Year, with the Base
Operating Expenses, as the case may be, the amounts, if any, collected by Owner
from Tenant under Section B(3) of Article 40 hereof or B(4) of Article 40 on
account of the Operating Payment or the Tentative Monthly Escalation Charge, as
the case may be, shall be adjusted, and, if the amount so collected is less than
or exceeds the amount actually due under said Operating Statement for the
Operating Year, a reconciliation shall be made as follows: Tenant shall be
debited with any Operating Payment shown on such Operating Statement and
credited with the amounts, if any, paid by Tenant on account in accordance with
the provisions of subsection B(3) and subsection B(4)(ii) of this Article 40 for
the Operating Year in question. Tenant shall pay any net debit balance to Owner
within fifteen (15) days next following rendition by Owner of an invoice for
such net debit balance; any net credit balance shall be applied against the next
accruing monthly installments of fixed rent.
(ii) If the sum of the Tentative Monthly Escalation Charges
and payments made by Tenant in accordance with subsection B(3) of this Article
40 for any Operating Year shall have exceeded the Operating Payment for such
Operating Year by more than five percent (5%), interest at the rate of two (2)
percentage points above the Base Rate on the portion of the overpayment that
exceeds the applicable Operating Payment by more than five percent (5%)
determined as of the respective dates of such payments by Tenant and calculated
from such respective dates to the dates on which such amounts are credited
against the monthly installments of fixed rent, shall be so credited. Any amount
owing to Tenant subsequent to the term shall be paid to Tenant within ten (10)
business days after a final determination has been made of the amount due to
Tenant.
C. Any Operating Statement sent to Tenant shall be conclusively binding
upon Tenant unless, within forty-five (45) days after such Statement is sent,
Tenant shall send a written notice to Owner objecting to such Statement and
specifying the respects in which such Statement is disputed. If such notice is
sent, Tenant (together with its independent certified public accountants,
provided they are one of the so-called "big-six" accounting firms or if at such
time there is no group of accounting firms commonly referred to as "big-six,"
then a nationally recognized firm of at least one hundred fifty (150) partners
or principals who are certified public
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accountants) may examine Owner's books and records relating to the operation of
the property to determine the accuracy of the Operating Statement. Tenant
recognizes the confidential nature of such books and records and agrees to
maintain the information obtained from such examination in strict confidence.
If after such examination, Tenant still disputes such Operating Statement,
either party may refer the decision of the issues raised to a reputable
independent firm of certified public accountants, selected by Owner and
approved by Tenant, which approval shall not be unreasonably withheld or
delayed as long as such firm of certified public accountants is one of the
so-called "big-six" public accounting firms or if at such time there is not
group accounting firms commonly referred to as "big-six", then a nationally
recognized firm of at least one hundred fifty (150) partners or principals who
are certified public accountants, and the decision of such accountants shall be
conclusively binding upon the parties. The fees and expenses involved in such
decision shall be borne by the unsuccessful party (and if both parties are
partially successful, such fees and expenses shall be apportioned between Owner
and Tenant in inverse proportion to the amount by which such decision is
favorable to each party). Notwithstanding the giving of such notice by Tenant,
and pending the resolution of any such dispute, Tenant shall pay to Owner when
due the amount shown on any such Operating Statement, as provided in Section B
of Article 40 hereof without prejudice to Tenant's position.
D. The expiration or termination of this Lease during any Operating Year
shall not affect the rights or obligations of the parties hereto respecting any
payments of Operating Payments for such Operating Year and any Operating
Statement relating to such Operating Payment may be sent to Tenant subsequent
to, and all such rights and obligations shall survive, any such expiration or
termination. In determining the amount of the Operating Payment for the
Operating Year in which the term shall expire, the payment of the Operating
Payment for such Operating Year shall be prorated based on the number of days of
the term which fall within such Operating Year. Any payments due under such
Operating Statement shall be payable within thirty (30) days after such
Statement is sent to Tenant.
41. Restrictions on Signs
No lettering, sign, advertisement, notice, or object shall be
displayed in or on the windows or doors, or on the outside of the Demised
Premises, or at any point inside the Demised Premises, where the same might be
visible outside of the Demised Premises, except that the name and logotype of
Tenant and its subtenants may be displayed on or next to the entrance doors of
the Demised Premises and in the elevator lobby of the 30th floor of the
Building, subject to the approval of Owner (which shall not be unreasonably
withheld) as to the size, color, material, style and location of such display.
Owner shall provide Tenant with Tenant's Proportionate Share of listings on the
Building lobby directory.
42. Consents
A. Wherever in this lease it is provided that either party shall not
unreasonably withhold consent or approval or shall exercise its judgment
reasonably, such consent or approval or exercise of judgment (hereinafter
referred to collectively as
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("consent") shall also not be unreasonably delayed. If a party considers that
the other party has unreasonably withheld or delayed a consent it shall so
notify the other party within ten (10) days after receipt of notice of denial
of the requested consent, or in case notice of denial is not received within
twenty (20) days after making its request for the consent, within ten (10) days
after the expiration of such twenty (20) day period; and within ten (10) days
after giving the first mentioned notice it may submit the question of whether
the withholding or delaying of such consent is unreasonable to determination by
informal arbitration in the manner provided in Article 43. Failure to give
such first mentioned notice or to make such submission to arbitration within
the period hereinabove provided therefor shall preclude any further right to
dispute the reasonableness of such withholding of consent. A consent shall not
be deemed to have been unreasonably withheld or delayed unless the aggrieved
party complies with the foregoing procedure and it shall be so determined by
arbitration as aforesaid. In the event of such determination, the requested
consent shall be deemed to have been granted for all purposes of this lease;
however, except to the extent otherwise provided below in this Section A, the
party who shall have refused or failed to give such consent shall not have any
liability to the other party therefor and the only remedy for an unreasonable
withholding or delaying of consent by either party shall be as provided in this
Article. Notwithstanding the foregoing, the party in whose favor such a
determination has been made and has become final shall be entitled to recover
from the other party its reasonable counsel fees and arbitration fees paid and
court costs awarded in connection with such determination.
B. Wherever in this lease or any Exhibit it is provided that the
approval of a representative of either party (such as Owner's engineer or
architect or Tenant's designer or engineer) is required for any particular
matter, such approval shall be deemed to be a consent of the party for the
purposes of Part A of this Article, provided that a true copy of the notice
requesting such approval is given to the party so represented before the other
party may claim that such approval has been unreasonably withheld or delayed.
C. Whenever Tenant shall submit to Owner any plan, agreement or other
document for Owner's consent or approval and Owner shall require the expert
opinion of Owner's counsel, architect, engineer or other representative or agent
of Owner as to the form or substance thereof, Tenant shall pay to Owner, Owner's
reasonable and actual out-of-pocket cost to unrelated third-parties of obtaining
such expert opinion within ten (10) days after Owner's demand therefor.
43. Informal Arbitration
A. Every dispute between the parties which is specifically provided in
this lease to be determined by informal arbitration shall be submitted to the
Chairman of the Board of Directors of the Management Division of the Real Estate
Board of New York, Inc. (or to such officer of said Real Estate Board or of any
similar organization then successor thereto, having like authority or duties),
for determination by him or by such other, impartial person or persons as he may
designate, and such determination, when made and rendered to the parties in
writing, shall be final and conclusive on the parties. Such submission may be
made by either party on notice to the other ("Notice of Dispute") and the other
party may then, within ten (10) days after
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receipt of the Notice of Dispute present its statement of the matter in dispute
(the "Reply") to such arbitrator, upon written notice to the first party. The
expenses of such informal arbitration shall be borne by the parties equally.
B. If at the time such dispute is to be submitted neither the Real
Estate Board of New York, Inc. nor any such successor organization shall exist,
or if at such time the appropriate officer of said Real Estate Board or of such
successor organization shall be unwilling or unable to accept the submission, or
if despite diligent efforts made in good faith by either party, the arbitrator
is not appointed or does not commence hearing the matter within thirty (30) days
after the receipt of the Reply, or if the arbitrator to whom the matter is
submitted shall fail to render his decision to the parties in writing within
sixty (60) days after the receipt of the Reply, then in any such event, at the
instance of either party, if the event shall not be due to its fault or neglect,
the matter in dispute shall be determined by arbitration in the City and County
of New York in accordance with the Commercial Arbitration Rules then obtaining
of the American Arbitration Association (or any organization then successor
thereto). The expenses of such procedure shall be borne by the parties equally.
C. Notwithstanding anything to the contrary provided elsewhere in this
lease, either party may elect, in the manner hereinafter provided, to have any
dispute which would otherwise be determinable by informal arbitration pursuant
to Part A Of this Article, determined by the Supreme Court of New York, New York
County, under the New York Simplified Procedure for Court Determination of
Disputes pursuant to Section 3031 of the Civil, Practice Law and Rules of the
State of New York. Such election may be exercised by either party (i) giving the
other party a notice requesting such judicial determination of the matter in
dispute, which shall include an express statement of the election making
specific reference to this Part C and (ii) at the same time serving the other
party with the judicial process for submission of such dispute for such
determination pursuant to said Section 3031. Such notice of election and service
of process must be given and made, if by the party seeking to submit the dispute
to determination, when the Notice of Dispute referred to in Part A of this
Article would have to be served if the dispute were to be determined by informal
arbitration, or if by the other party, within ten (10) days after receipt of the
first party's Notice of Dispute. In such event, each party shall be empowered to
do all acts and to make all motions consistent with the New York Simplified
Procedure for Court Determination of Disputes, including without limitation the
motion to settle the terms of the statement specified in Section 3034 thereof.
The expenses of such procedure shall be borne by the parties equally.
44. Assignment and Subletting
Notwithstanding the provisions of Articles 11 and 34B(8), and in
modification and amplification thereof:
A. If this lease be assigned, whether or not in violation of the
provisions of this lease, Owner, may collect rent from the assignee. If the
Demised Premises or any part thereof be sublet or be used or occupied by anybody
other am Tenant whether or in violation of this
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lease, Owner may, after default by Tenant and expiration of Tenant's time to
cure such default, if any, collect rent from the undertenant or occupant. In
either event, Owner may apply the net amount collected to the rents herein
reserved, but no such assignment, underletting, occupancy or collection shall
be deemed a waiver of any of the provisions of Article 11 or of this Article,
or the acceptance of the assignee, undertenant or occupant as a tenant, or a
release of Tenant from the further performance by Tenant of Tenant's
obligations under this lease. The consent by Owner to assignment, mortgaging,
underletting or use or occupancy by others shall not in any way be considered
to relieve Tenant from obtaining the express consent of Owner to any other or
further assignment, mortgaging or underletting or use or occupancy by others
not expressly permitted by this Article. References in this lease to use or
occupancy by others, that is anyone other than Tenant, shall not be construed
as limited to subtenants and those claiming under or through subtenants but as
including also licensees and others claiming under or through Tenant,
immediately or remotely.
B. (1) Tenant may, without Owner's consent, assign this lease for the
use set forth in Article 2 to a corporation or other business entity (herein
sometimes called a "successor corporation") into which or with which Tenant
shall be merged, or consolidated, or to which substantially all of Tenant's
assets may be transferred, provided that the successor corporation shall have
assumed substantially all of Tenant's obligations and liabilities, including all
obligations under this lease, by operation of law or by appropriate instruments
of merger, consolidation or transfer. In case of an assignment by merger or in
consolidation, a true copy of the instrument of merger or consolidation
containing the successor corporation's assumption of Tenant's obligations and
liabilities, assuming Tenant's liabilities under this lease, shall be acceptable
to Owner in lieu of the agreement mentioned in the first sentence of Part G.
below.
(2) Tenant may, without Owner's consent, assign this Lease or sublet
any part or parts of the Demised Premises for the use set forth in Article 2 to
a corporation, a limited liability company or other business entity (herein
called a "related corporation") which shall control, be controlled by or be
under common control with Tenant, provided (i) Tenant shall comply with Part E
below, and (ii) such assignee or subtenant shall continue to be a related
corporation of Tenant. Any related corporation may use and occupy any part of
the Demised Premises for any of the purposes permitted by this lease, subject to
compliance with Tenant's obligations under this lease, provided Tenant shall
notify Owner with reasonable promptness of (i) the name of the related
corporation, (ii) the manner in which the related corporation is related to
Tenant, and (iii) the period of time during which the related corporation will
use the Demised Premises. However such use shall not be deemed to vest in any
such related corporation any right or interest in this lease or the Demised
Premises. As used herein in defining a related corporation, control shall be
deemed established by ownership of over 50% of the stock or other voting
interest of the controlled corporation or other business entity.
C. If Tenant shall desire to assign this lease or to sublet the Demised
Premises, in whole or in part, to anyone other than a related or successor
corporation, only for the use set forth in Article 2, Tenant shall submit to
Owner a request for Owner's consent to such assignment or subletting, which
request shall contain or be accompanied by the following
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information: (i) the name and address of the proposed assignee or subtenant;
(ii) a description identifying the space to be sublet and Tenant's improvements
included therein; (iii) the basic terms and conditions, including the effective
date of the proposed assignment of subletting; (iv) the nature and character of
the business of the proposed assignee or subtenant and of its proposed use of
the Demised Premises or part thereof; and (v) current financial information and
any other information Owner may reasonably request with respect to the proposed
assignee or subtenant.
D. Owner shall not unreasonably withhold its consent to the proposed
assignment or subletting referred to in Tenant's notice given pursuant to Part
C, provided that:
(1) If Owner should have, or within three months will have, suitable
space available in the Building, the proposed assignee, or subtenant shall not
then be a prospective tenant with whom Owner shall have been negotiating for the
leasing of space in the Building.
(2) The subletting shall be expressly subject to all of the
obligations of Tenant under this lease and the further condition and restriction
that the sublease shall not be assigned, encumbered or otherwise transferred or
the subleased premises further sublet by the sublessee in whole or in part, or
any part thereof suffered or permitted by the sublessee to be used or occupied
by others, without the prior consent of Owner in each instance, subject to the
provisions hereof.
(3) No subletting shall end later than one day before the Expiration
Date of this lease.
(4) The subletting is subject to the express condition, and by
accepting a sublease hereunder each subtenant shall be conclusively deemed to
have agreed, that if this lease should be terminated prior to the Expiration
Date or if Owner should succeed to Tenant's estate in the Demised Premises, then
at Owner's election the subtenant shall attorn to and recognize Owner as the
subtenant's landlord under the sublease and the subtenant shall promptly execute
and deliver any instrument Owner may reasonably request to evidence such
attornment.
(5) The Demised Premises shall not be occupied at any time by more
than two (2) subtenants or by more than three (3) entities, including Tenant.
The areas to be sublet shall have direct access to the public corridor,
elevators, stairwells and toilets on the same floor of the Building. All access
corridors shall not be less than 6 feet in width and shall be constructed in
compliance with all applicable laws and requirements of public authorities.
E. Tenant shall give Owner at least fourteen (14) days' prior written
notice before entering into any proposed sublease or assignment and Tenant shall
furnish Owner with a counterpart (which may be a conformed or reproduced copy)
of each sublease or assignment made hereunder promptly after the date of its
execution. Tenant shall remain fully liable for the performance of all of
Tenant's obligations hereunder notwithstanding any subletting provided for
herein, and without limiting the generality of the foregoing, shall remain fully
responsible and
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liable to Owner for all acts and omissions of any subtenant or anyone claiming
under or through any subtenant which shall be in violation of any of the
obligations of this lease and any such violation shall be deemed to be a
violation by Tenant.
F. Notwithstanding any assignment and assumption by the assignee of the
obligations of Tenant hereunder, Tenant herein named, and each immediate or
remote successor in interest of Tenant herein named, shall remain liable jointly
and severally (as a primary obligor) with its assignee and all subsequent
assignees for the Performance of Tenant's obligations hereunder, and, without
limiting the generality of the foregoing, shall remain fully and directly
responsible and liable to Owner for all acts and omissions on the part of any
assignee subsequent to it in violation of any of the obligations of this lease.
G. Notwithstanding anything to the contrary hereinabove set forth, no
assignment of this lease shall be binding upon Owner unless the assignee shall
execute and deliver to Owner an agreement, in recordable form whereby such
assignee agrees unconditionally to be personally bound by and to perform all of
the obligations of Tenant hereunder and further expressly agrees that
notwithstanding such assignment the provisions of this Article shall continue to
be binding upon such assignee with respect to all future assignments and
transfers. A failure or refusal of such assignee to execute or deliver such an
agreement in recordable form shall not release the assignee from its liability
for the obligations of Tenant hereunder assumed by acceptance of the assignment
of this lease.
H. (1) If Tenant shall receive any consideration from its assignee for
or in connection with the assignment of this lease or from the sale or use of
Tenant's Property or Tenant's interests in the Initial Tenant's Changes, other
than from a related or successor corporation, then, Tenant shall account to
Owner therefor and shall pay over to Owner fifty percent (50%) of such
consideration as and when such consideration is received, provided, however,
with respect to consideration for Tenant's Property, Tenant shall be required to
share such consideration only to the extent the consideration received by Tenant
for such Tenant's Property exceeds the unamortized cost thereof to Tenant.
(2) If Tenant shall receive any rents and/or consideration from its
subtenant, other than from a related corporation, which for any period, shall
exceed the per square foot rates of the fixed rent, the additional rent and
escalation rent payable under this lease pursuant to Articles 39 and 40 for the
same period; or if Tenant shall receive from its subtenant any consideration for
the sale or use of Tenant's Property or Tenant's right to use the Initial
Tenant's Changes; then, in each instance Tenant shall account to Owner therefor
and shall pay over to Owner fifty percent (50%) of such excess rents and of such
other consideration, as and when received. With respect to consideration paid
for Tenant's Property, Tenant shall be required to pay over to Owner fifty
percent (50%) of such consideration only to the extent the consideration
received by Tenant for such Tenant's Property exceeds the unamortized cost
thereof to Tenant.
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45. Brokerage
Each party represents and warrants to the other that it has not dealt
with any broker or person in connection with this Lease that no broker, or other
person acting as such, other than Robert A. Emden of Edward S. Gordon Company,
Inc. ("Broker") as broker, and Owner's renting agent, Colliers ABR, Inc.
("Colliers"). The execution and delivery of this Lease by each party shall be
conclusive evidence that such party has relied upon the foregoing representation
and Warranty. Owner will pay said broker a commission for procurement of this
lease in accordance with Owner's separate agreement with Broker. Tenant shall
indemnify and hold Owner harmless from and against any and all claims for
commission, fee or other compensation by any person (other than Broker and
Colliers) who shall claim to have dealt with Tenant in connection with this
Lease and for any and all costs incurred by Owner in connection with such
claims, including, without limitation, reasonable attorneys' fees and
disbursements. Owner shall indemnify and hold Tenant harmless from and against
any and all claims for commission, fee or other compensation by any person
(including Broker and Colliers) who shall claim to have dealt with Owner in
connection with this Lease and for any and all costs incurred by Tenant in
connection with such claims, including, without limitation, reasonable
attorneys' fees and disbursements. The provisions of this Article 45 shall
survive the expiration or prior termination of this Lease.
46. Rent Control
If at the commencement of, or at any time(s) during the term of this
lease, the rent(s) reserved in this lease shall not be fully collectible for
reason of any Federal, State, County or City law, proclamation, order or
regulation, or direction of a public officer or body pursuant to law, Tenant
shall enter into such agreement(s) and take such other steps (without additional
expense to Tenant) as Owner may request and as may be legally permissible to
permit Owner to collect the maximum rents which may from time to time during the
continuance of such legal rent restriction be legally permissible (and not in
excess of the amounts reserved therefor under this lease). Upon the termination
of such legal rent restriction prior to the expiration of the term of this
lease, (a) the rents shall become and thereafter be payable hereunder in
accordance with the amounts reserved in this lease for the periods following
such termination and (b) Tenant shall pay to Owner, if legally permissible, an
amount equal to (i) the rents which wold have been paid pursuant to this lease
but for such legal rent restriction less (ii) the rents paid by Tenant to Owner
during the period(s) such legal rent restriction was in effect. Any security or
Letter of Credit deposited by Tenant may be retained by Owner for one year after
such termination of this lease, to secure collection of any amount Owner may be
entitled to receive pursuant to clause (b) above.
47. Condition of the Demised Premises
A. (1) Tenant has inspected the Demised Premises and shall take
possession of the Demised Premises "as is", and Owner shall have no obligation
to alter, improve, decorate or otherwise prepare the Demised Premises for
Tenant's occupancy, except as set forth on Exhibit
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"B". As of the date hereof, Owner has Substantially Completed item numbers (1)
through (5) of Owner's Work. Owner has made no representations as to the date
on which it will complete item numbers (6) through (12) of Owner's Work (the
"Post Possession Work") and Owner shall be under no penalty or liability to
Tenant whatsoever by reason of any delay in the performance of the Post
Possession Work and this Lease and the Commencement Date shall not be affected
thereby. Owner shall use reasonably diligent efforts to Substantially Complete
the Post Possession Work in an expeditious manner and shall perform such Work
in accordance with reasonable construction practices. Notwithstanding the
foregoing, Owner shall have no obligation to employ contractors or labor at
so-called overtime or other premium pay rates or to incur any other overtime
costs or expenses whatsoever to complete the Post Possession Work. Tenant
acknowledges that the Post Possession Work will not be completed by the
Commencement Date and Tenant shall permit Owner access to the Demised Premises
after the Commencement Date to complete the Post Possession Work and the
payment of fixed rent, additional rent and escalation rent shall not be
affected thereby. Tenant further acknowledges that Owner may be performing the
Post Possession Work and Tenant may be performing the Initial Tenant's Changes
during the same time period. Accordingly, for the purposes of avoiding
substantial hinderance or delay in the completion of their respective work,
Owner and Tenant shall cooperate with each other, in good faith, in connection
with the scheduling and performance of such work. Tenant, in compliance with
the further provisions of this Article 47, Building regulations and procedures,
and other applicable provisions of this lease, shall perform the Initial
Tenant's Changes. In addition, Tenant shall make any and all modifications and
additions and replacements to the existing sprinkler and alarm systems as may
be necessitated by the Initial Tenant's Changes.
(2) As part of the Initial Tenant's Changes, Tenant shall install one
(1) unisex handicapped bathroom on the thirtieth (30th) floor of the Building in
compliance with ADA together with all regulations and guidelines promulgated
pursuant thereto or in connection therewith (the "Bathroom Work") and renovate
the other bathrooms located on the thirtieth (30th) floor of the Building (the
"Additional Bathroom Renovation Work"). Owner shall reimburse Tenant for a total
of Twenty Thousand Dollars ($20,000) of the costs and expenses incurred by
Tenant in the performance of the Bathroom Work and the Additional Bathroom
Renovation Work (the "Bathroom Work Contribution"). It is expressly understood
and agreed however that Tenant shall not be reimbursed for any of the Additional
Bathroom Renovation Work until the Bathroom Work has been completed and paid for
in full. The Bathroom Work and the Additional Bathroom Renovation Work shall be
performed by Tenant in a first-class manner comparable to other alterations made
to the Building and otherwise in accordance with and pursuant to Article 3 and
Section 34C hereof. The Bathroom Work Contribution shall be disbursed in
accordance with Section 34C(3)(d) hereof. In no event shall the aggregate amount
paid by Owner to Tenant under this Section 47(2) exceed the amount of the
Bathroom Work Contribution. Upon the completion of the Bathroom Work and the
Additional Bathroom Renovation Work, any amount of the Bathroom Work
Contribution which has not been previously disbursed shall be retained by Owner.
Upon the disbursement of the Bathroom Work Contribution (or the portion thereof
if upon completion of the Bathroom Work and the Additional Bathroom Renovation
Work the Bathroom Work Contribution is not exhausted),
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Owner shall have no further obligation or liability whatsoever to Tenant for
further disbursement of any portion of the Bathroom Work Contribution to
Tenant. It is expressly understood and agreed that Tenant shall complete, at
its sole cost and expense, the Bathroom Work and the Additional Bathroom
Renovation Work whether or not the Bathroom Work and the Additional Bathroom
Renovation Work in excess of the Bathroom Work Contribution shall be the sole
responsibility and obligation of Tenant.
(3) If Owner installs solar coating on the windows of the premises
demised to an existing tenant of the Building which occupies more than two (2)
floors of the Building, Owner shall install such solar coating on the windows of
the Demised Premises to the extent same was installed for such existing tenant.
B. Tenant shall prepare and shall submit to Owner for its approval
(which shall not be unreasonably withheld) complete, finished, detailed and
fully dimensioned architectural, electric and engineering plans and drawings
(1/4" or 1/8" scale), and specifications for the Initial Tenant's Changes
("Tenant's Plans"), employing engineers approved by Owner (which approval shall
not be unreasonably withheld). Owner's current Building engineer is Cantor &
Seinuk. Tenant's Plans shall be practicable and shall conform to the existing
physical condition of the Building, the filed plans and specifications for the
Building, and all applicable laws and requirements of law and public
authorities, including, without limitation, the State Lighting Efficiency
Standards for Existing Public Buildings Act, Article 8 of the New York Energy
Law, as amended, and the rules and regulations implementing the same.
C. Upon Owner's approval of Tenant's Plans, Tenant shall cause Tenant's
Plans (including mechanical plans and specifications) to be filed with the
governmental agencies having jurisdiction thereof, in order to obtain, and shall
obtain, all governmental permits, approvals, licenses, authorizations, waivers,
consents and certificates (collectively, "Permits") which may be required in
connection with the performance of the Initial Tenant's Changes. Owner shall
with reasonable promptness sign the applications for such Permits prepared by
Tenant which require Owner's signature and Tenant shall indemnify and hold Owner
harmless against any claim, cost, liability or expense resulting from any error,
omission or other impropriety or deficiency in any such application. In order to
expedite Tenant's receipt of a building application number in connection with
the Initial Tenant's Changes, Tenant has requested Owner's permission to file
Tenant's initial plans and specifications for the Initial Tenant's Changes (the
"Initial Plans") with the Building Department of the City of New York (the
"Building Department") prior to Owner's review or approval of such Initial
Plans. Owner hereby gives such permission and shall sign necessary Building
Department forms requiring its signature as owner, to be filed by an architect
at the Building Department together with the Initial Plans, but such permission
and such filing shall not be deemed approval of the Initial Plans for any
purpose under this Lease nor shall submission of such Initial Plans to Owner be
deemed to be submission to Owner for approval pursuant to Article 3 and/or
Article 34C hereof nor shall Tenant rely on such submission as consent to such
Initial Tenant's Changes. Such permission by Owner and such filing shall be
without prejudice to Owner and without any representation or warranty whatsoever
to Tenant or any other person with respect to the
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adequacy, correctness or efficiency thereof or otherwise. Any modifications of
or additions to the Initial Plans may not be submitted to the Building
Department without Owner's prior consent. The Initial Tenant's Changes shall
be governed by the provisions of Articles 3 and 34C(3) with respect to Tenant's
Changes as if the Initial Tenant's Changes were Tenant's Changes as modified
and supplemented by this Article. Tenant shall employ, as its general
contractor for the performance of the Initial Tenant's Changes, such contractor
as Tenant may select (subject to Cauldwell's right to bid as set forth in
Article 34C(3)(b) hereof) from the approved list of contractors set forth on
Exhibit "G". Tenant shall employ as its mechanical and electrical contractors
only such mechanical and electrical contractors as Owner employs or has
otherwise approved for mechanical and electrical work in the Building provided
such contractors' fees or charges are generally competitive with those of like
contractors in comparable first class office buildings in Manhattan. The
approved list of electrical and mechanical contractors for the performance of
the Initial Tenant's Changes is set forth on Exhibit "G". Owner shall permit
Tenant's contractors and suppliers to move construction materials, supplies and
equipment for the Initial Tenant's Changes to the Demised Premises and to
remove construction waste and debris therefrom, by an elevator to be designated
by Owner, at times appointed by Owner after normal business hours or on other
business days, giving effect to other previously made appointments. There
shall be no cost to Tenant's contractors and suppliers for the infrequent and
minimal use of said elevators on Monday through Friday from 8:00 a.m. to 6:00
p.m. and on Saturday from 9:00 a.m. to 1:00 p.m. ("Business Hours"). At all
times, other than Business Hours, Tenant's contractors and suppliers shall pay
Owner's actual cost basis for the use of such elevator. Such elevator use
shall be subject to reasonable scheduling and supervision by Owner. As of the
date hereof, Owner's cost for providing freight elevator service during
Business Hours is $33 per hour or part thereof and $50 per hour or part thereof
for times other than Business Hours, which rates are subject to change to
reflect any changes in Owner's actual cost for same. It is expressly
understood and agreed that Tenant shall not move into the Demised Premises
during the hours of 8:00 a.m. and 6:00 p.m. Monday through Friday. Tenant
shall, and shall cause its contractors and suppliers to, comply with Owner's
rules and regulations, and Owner's directions for the coordination and control
of construction activities in the Building and the protection and security of
the Building and its systems and occupants.
D. Throughout the performance of the Initial Tenant's Changes in or
about the Demised Premises, Tenant shall maintain, or cause to be maintained:
(i) Worker's Compensation insurance coverage in statutory limits
for all eligible workmen engaged in the Initial Tenant's Changes;
(ii) Public Liability insurance, of which Owner shall be a named
assured, in limits of $1,000,000/$1,000,000 for bodily injury and death,
$500,000/$1,000,000 for property damage and $10,000,000 umbrella
coverage for bodily injury, death and property damage, which shall also
include automobile liability insurance and blanket contract liability
coverage for Tenant's indemnity obligations to Owner under this lease;
and
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(iii) Builder's All-Risk insurance in an amount equal to the
value of the Initial Tenant's Changes on the completion thereof.
Tenant shall submit to Owner, before commencement of any of the Initial
Tenant's Changes in or about the Demised Premises, certificates of such
Worker's Compensation, Public Liability and Builder's All-Risk insurance.
48. Insurance
A. Tenant shall at all times keep Tenant's Property and all other
alterations, installations and improvements made by Tenant in the Demised
Premises now or hereafter included in the Demised Premises insured for damages
by fire and lighting, vandalism, malicious mischief and all other risks and
hazards comprehended by the full "extended coverage" endorsements and against
such other hazards and risks as Owner may from time to time reasonably
designate, for the "full replacement cost" thereof. Such full replacement cost
shall be determined from time to time but not more frequently than once in any
twenty-four (24) calendar month period at the request of Owner or any superior
Mortgagee or Lessee by an appraiser, engineer, architect or contractor
designated by Owner or such Mortgagee or Lessee.
B. In addition to fire, lightning and extended coverage insurance,
Tenant will maintain personal injury or property damage insurance, under a
policy of general public liability insurance, with such limits as may reasonably
be requested by Owner from time to time, but not less than $1,000,000/$1,000,000
in respect to bodily injury or death and $500,000/1,000,000 for property damage,
and $10,000,000 umbrella coverage for bodily injury, death and property damage,
and the policy or policies evidencing such insurance shall include Owner as an
additional insured but only with respect to liability arising out of the
ownership, maintenance or use of the Demised Premises.
C. All policies required to be maintained pursuant to the provisions of
this lease shall be issued by an insurance company or companies having a Best's
rating of at least A/AAA and authorized to do business in the State of New York.
All policies required to be maintained pursuant to the provisions of this lease
shall have a written undertaking from the insurer to notify all insureds
thereunder at least thirty (30) days prior to cancellation thereof. Tenant may
provide any insurance required pursuant to the provisions of this lease under a
so-called blanket policy or policies covering other parties and locations so
long as the coverage under such policy or policies is not thereby diminished.
Upon written request, Tenant shall furnish Owner with a certificate of insurance
evidencing any such policy or a certificate naming Owner as an additional
insured.
49. Abatement of Rent
The fixed rent and additional rent under Articles 39 and 40 payable
hereunder shall be abated for the period commencing on the Commencement Date and
ending on the day preceding the Rent Commencement Date. The first monthly
installment of fixed rent shall be
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payable on the Rent Commencement Date in an amount which shall be pro-rated to
the number of days from the Rent Commencement Date to the last day of the
calendar month in which it occurs, both days included. Notwithstanding the
foregoing, Tenant shall be required to pay for its consumption of electricity
and all other sums payable hereunder, if any, commencing on the Commencement
Date and there shall be no abatement therefor.
50. Intentionally Omitted
51. Miscellaneous Additional Provisions
A. Subject to its reasonable security regulations, Owner agrees that (x)
the Building shall be accessible to Tenant and (y) Tenant shall have the use of
at least one (1) elevator subject to call, twenty-four (24) hours a day, seven
(7) days a week.
B. This Lease is offered for signature by Tenant and it is understood
that this Lease shall not be binding upon Owner or Tenant unless and until Owner
and Tenant shall each have executed and unconditionally delivered a fully
executed copy of this Lease to the other.
C. This lease shall be deemed to have been made in New York County, New
York, and shall be construed in accordance with the laws of the State of New
York. All actions or proceedings relating, directly or indirectly, to this lease
shall be litigated only in courts located within the County of New York. Tenant,
any guarantor ("Guarantor") of the performance of its obligations hereunder, if
any, and their successors and assigns hereby subject themselves to the
jurisdiction of any state or federal court located within such county, waive the
personal service of any process upon them in any action or proceeding therein
and consent that such process be served by certified or registered mail, return
receipt requested, directed to the Tenant and any successor at Tenant's address
hereinabove set forth, to Guarantor and any successor at the address set forth
in the instrument of guaranty and to any assignee at the address set forth in
the instrument of assignment. Such service shall be deemed made two (2) business
days after such process is so mailed.
D. Tenant shall deposit with Owner on the signing of this Lease, a
"clean," unconditional, irrevocable and transferable letter of credit (the
"Letter of Credit") in the amount of One Million Two Hundred Fifty Thousand
Dollars ($1,250,000), reasonably satisfactory to Owner, issued by and drawn on a
bank satisfactory to Owner and which is a member of the New York Clearing House
Association, for the account of Owner, for a term of not less than one (1) year,
as security for the faithful performance and observance by Tenant of the terms,
covenants, conditions and provisions of this Lease, including, without
limitation, the surrender of possession of the Demised Premises to Owner as
herein provided. Notwithstanding the foregoing, due to the fact that Nation's
Bank is the bank through which Tenant currently conducts its banking business,
Owner shall permit the Letter of Credit to be issued by Nation's Bank
notwithstanding the fact that Nation's Bank is not a member of the New York
Clearing House, provided, however, if Tenant ceases using Nation's Bank and
changes the bank through which it conducts its banking business, Tenant shall
deposit a new Letter of Credit with Owner drawn on a bank
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or trust company which is a member of the New York Clearing House and otherwise
in accordance with the terms, conditions and provisions contained in this
Section 51D. If an event of default shall occur and be continuing, Owner may
present the Letter of Credit for payment and apply the whole or any part of the
proceeds thereof, (i) toward the payment of any fixed rent, escalation rent or
any other item of rental as to which Tenant is in default, (ii) toward any sum
which Owner may expend or be required to expend by reason of Tenant's default
beyond applicable grace periods, if any, in respect of any of the terms,
covenants and conditions of this Lease, including, without limitation, any
damage, liability or expense (including, without limitation, reasonable
attorneys' fees and disbursements) incurred or suffered by Owner, and (iii)
toward any damage or deficiency incurred or suffered by Owner in the reletting
of the Demised Premises, whether such damages or deficiency accrue or accrues
before or after summary proceedings or other re-entry by Owner. If Owner applies
any part of the proceeds of the Letter of Credit, Tenant, upon demand, shall
deposit with Owner the amount so applied so that Owner shall have the full
deposit on hand at all times during the term. If Tenant shall fully and
faithfully comply with all of the terms, provisions, covenants and conditions of
this Lease, the Letter of Credit shall be returned to Tenant after the
Expiration Date and after delivery of possession of the Demised Premises to
Owner. In the event of a sale or leasing of the Land or the Building, Owner
shall have the right to transfer the Letter of Credit to the vendee or lessee
and Owner shall thereupon be released by Tenant from all liability for the
return of the Letter of Credit, and Tenant shall cause the bank which issued the
Letter of Credit to issue an amendment to the Letter of Credit or issue a new
Letter of Credit naming the vendee or lessee as the beneficiary thereunder.
Tenant shall look solely to the new owner for the return of the Letter of
Credit. The provisions hereof shall apply to every transfer or assignment of the
Letter of Credit made to a new owner. Tenant shall not assign or encumber or
attempt to assign or encumber the monies deposited herein as security and
neither Owner nor its successors or assigns shall be bound by any such
assignment, encumbrance, attempted assignment or attempted encumbrance. Tenant
shall renew any Letter of Credit from time to time, at least thirty (30) days
prior to the expiration thereof, and deliver to Owner a new Letter of Credit or
an endorsement to the Letter of Credit, and any other evidence required by Owner
that the Letter of Credit has been renewed for a period of at least one (1)
year. If Tenant shall fail to renew the Letter of Credit as aforesaid, Owner may
present the Letter of Credit for payment and retain the proceeds thereof as
security in lieu of the Letter of Credit. Provided that Tenant shall fully and
faithfully comply with all of the terms, provisions and conditions of this
Lease, (i) from and after the date which is the third (3rd) year anniversary of
the Rent Commencement Date through and until the date immediately preceding
fourth (4th) anniversary of the Rent Commencement Date, the amount of the Letter
of Credit shall be reduced to Nine Hundred Fifty Thousand Dollars ($950,000),
(ii) from and after the date which is the fourth (4th) anniversary of the Rent
Commencement Date through and until the date immediately preceding the fifth
(5th) anniversary of the Rent Commencement Date the amount of the Letter of
Credit shall be reduced to Six Hundred Fifty Thousand Dollars ($650,000), (iii)
from and after the date which is the fifth (5th) anniversary of the Rent
Commencement Date through and until the date immediately preceding the sixth
(6th) anniversary of the Rent Commencement Date the amount of the Letter of
Credit shall be reduced to Three Hundred Fifty Thousand Dollars ($350,000); and
(iv) from and after the date which is the sixth (6th) anniversary of the Rent
Commencement Date through and until
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the Expiration Date the amount of the Letter of Credit shall be reduced to
Three Hundred Thousand Dollars ($300,000).
E. Owner shall not discriminate against Tenant in the enforcement or
administration of the Building Rules and Regulations.
F. All agreements provided for in this lease, whether between the
parties or between either or both of the parties hereto and one or more other
parties shall be in writing.
G. Owner shall provide on site security/concierge, equipment, personnel,
procedures and systems for the Building.
H. In connection with the refinancing of the existing mortgage loan for
the Building, funds were allocated for the then anticipated tenant improvement
work and other tenant leasing expenses to be funded by Owner in connection with
the leasing of the Building, which funds (to the extent property cash flow is
not available) are to be used for, among other costs, the Tenant Fund. Owner, to
the best of its knowledge, is not in violation of any decree, ruling, judgment,
order or injunction applicable to it nor any law, ordinance, rule or regulation
of whatever nature, nor are there any actions, proceedings or investigations
pending or, to the best of its knowledge, threatened against or affecting Owner
(or any basis therefor known to Owner) before or by any court, arbitrator,
administrative agency or other governmental authority or entity, any of which,
if adversely decided, would materially or adversely affect its ability to cause
the Tenant Fund to be funded to Tenant in accordance with the terms and
provisions of Section 34C(3)(d) hereof. As of the date hereof, Owner has not
received any notice from the current Mortgagee of an event of default which
remains uncured under the existing mortgage loan for the Building.
/s/ Stanley Stahl
-----------------------------------------
STANLEY STAHL d/b/a STAHL PARK AVENUE CO.
SHOREWOOD PACKAGING CORPORATION
By: /s/ Howard M. Liebman
-------------------------------------
Name: Howard M. Liebman
--------------------------------
Title: Exe. Vice-Pres., CFO
-------------------------------
Tenant's Federal I.D. No. 11-2742734
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