Exhibit 10.61
GROUND LEASE
Between
THE BUFFALO ENTERPRISE DEVELOPMENT CORPORATION
Landlord,
and
AGRO POWER DEVELOPMENT, INC.
Tenant.
Dated: As of September 4, 1997
LEASE AGREEMENT
THIS LEASE AGREEMENT is made as of the 4th day of September, 1997 between
THE BUFFALO ENTERPRISE DEVELOPMENT CORPORATION, a not-for profit local
development corporation organized under the laws of the State of New York,
having its principal office and place of business at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Landlord") and AGRO POWER DEVELOPMENT, INC., a New Jersey
corporation, having an office at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ (the "Tenant").
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. Unless otherwise defined herein, the following
terms shall have the respective meanings specified below:
(a) "Affiliate" shall mean Tenant or any party controlled by or
controlling Tenant.
(b) "Assignment" shall mean any permitted assignment to a third party
by Tenant of all of its rights and obligations under this Lease.
(c) "Assignee" shall mean the assignee under an Assignment.
(d) "Commencement of Work" shall mean the date on which the excavation
work in connection with the construction of the Improvements has begun. To
"Commence Work" shall have the correlative meaning.
(e) "Commencement Date" shall mean the date hereof.
(f) "Completion Date" shall mean (1) the date upon which the
Improvements have been substantially completed in accordance with generally
accepted construction practices and have been certified to Landlord as such
by Tenants, based on certificates of completion reasonably satisfactory to
Landlord and a permanent and unconditional certificate of occupancy has
been issued therefor, and (2) with respect to the change, alteration or new
construction of the Improvements, or any Restoration of the Improvements,
that point in time when the Improvements have been substantially completed
in accordance with generally accepted construction practices and have been
certified as such by Landlord and a permanent and unconditional certificate
of occupancy has been issued for the completed work.
(g) "Construction Period" shall mean the period commencing with the
Commencement of Work for the Improvements, or Restoration, as the case may
be, and ending with the Completion Date of the Improvements or Restoration,
as the case may be.
(h) "Contract" shall mean that certain Contract for Sale of Land for
Redevelopment dated July 2, 1997 by and between City of Buffalo and
Landlord.
(i) "Default" shall mean any condition or event which constitutes or
would, after notice or lapse of time, or both, constitute an Event of
Default.
(j) "Demised Premises" shall mean the Land and all Easements, rights
and rights of way and licenses, but shall not include the Improvements or
Tenant's fixtures.
(k) "Development Costs" shall mean the costs of developing and
constructing the Improvements.
(l) "Easements" shall mean those easements under, over and across the
property of the Landlord adjacent to the Land which are reasonably
necessary for access to the Land and to furnish services (including
utilities) to the Improvements.
(m) "Event of Default" shall mean any of the acts or omissions defined
in Section 16.1 of this Lease.
(n) "Governmental Authorities" means all federal, state and municipal
governments, courts, departments, commissions, boards, and officers having
jurisdiction over the Demised Premises, the Improvements or the
construction thereof, or over, Landlord, Tenant or any Subtenant.
(o) "Governmental Requirement(s)" means all present and future laws,
ordinances, orders, rules, regulations and requirements of any Governmental
Authority having jurisdiction over the Improvements or the Demised Premises
or the use of either of them or this Lease and all building permits and
other licenses and approvals required by the appropriate Governmental
Authorities in connection with the Improvements or this Lease.
(p) "Hazardous Materials" shall have the meaning ascribed to it in
Section 5.3.
(q) "Impositions" shall mean all taxes, all assessments, water, sewer,
or other rents and charges, excises, levies, fees (including, without
limitation, licenses, permits, inspections, authorizations and similar
fees), and all other governmental charges, whether general or special,
ordinary or extraordinary, foreseen or unforeseen, which relate to the
ownership of the Land and the Improvements or the use or occupancy of the
Land and the Improvements.
(r) "Improvements" shall mean construction of a 18+/- acre greenhouse
facility to be used solely for agricultural purposes, concrete pad, parking
areas, driveways, utilities and all other appropriate appurtenances and
improvements, including, but not limited to, retention pond, distribution
and heating plant facilities used solely for the purpose of servicing the
aforesaid greenhouse facility and underground conduits and piping related
thereto.
(s) "Land" shall mean that certain parcel of real property described
in Exhibit A attached hereto.
(t) "Landlord" shall mean the Landlord named herein or any assignee or
other successor in interest of the named Landlord, which at the time is the
owner of the Land.
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(u) "Lease" shall mean this agreement between the Landlord and the
Tenant, including any renewals or amendments.
(v) "Leasehold Estate" shall mean the leasehold estate created by this
Lease.
(w) "Leasehold Mortgage" shall mean any mortgage or other real
property security instrument by which Tenant may encumber, hypothecate or
mortgage all or any part of the Leasehold Estate pursuant to the terms of
this Lease.
(x) "Leasehold Mortgagee" shall mean the holder of any Leasehold
Mortgage.
(y) "Municipality" shall mean the City of Buffalo.
(z) "Plans and Specifications" shall mean the site plan, construction
plans, drawings and related drawings for the Improvements which are in
sufficient detail to obtain a building permit from the Municipality.
(aa) "Project" shall mean the construction and operation of the
Improvements.
(ab) "Rent" shall mean all amounts payable by Tenant to Landlord
pursuant to this Lease.
(ac) "Restoration" shall have the meaning ascribed to it in Section
8.2.
(ad) "Sublease" shall mean a sublease of space in the Improvements
between a Subtenant and Tenant.
(ae) "Subtenant" shall mean the subtenant under a Sublease for space
in the Improvements.
(af) "Tenant" shall mean the Tenant herein named or any assignee or
other successor in interest of the Tenant, which at the time in question is
the owner of the Leasehold Estate; but the foregoing provisions of this
subsection shall not be construed to relieve the Tenant or any assignee or
other successor in interest of the Tenant from the full and prompt payment,
performance and observance of the covenants, obligations, conditions to be
paid, performed and observed by the Tenant under this Lease.
(ag) "Unavoidable Delay" shall mean delays due to strikes, act of God,
inability to obtain labor or materials, Governmental Requirements, removal
of Hazardous Materials discovered at any time after the Commencement Date,
enemy action, civil commotion, fire, unusual inclement weather, unavoidable
casualty or similar causes beyond the reasonable control of Tenant.
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ARTICLE II
PREMISES; TERM OF LEASE; RENT
Section 2.1. Demise. The Landlord does hereby demise and lease to Tenant,
and Tenant does hereby hire and take from Landlord, the Demised Premises.
Section 2.2. Term. A. This Lease shall have an initial term (the "Initial
Term") of Fifteen (15) years beginning on the Commencement Date and ending on
the day immediately preceding the fifteenth (15th) anniversary of the
Commencement Date.
B. Provided Tenant is not then in default hereunder at the time the option
herein is exercised and at the commencement of the "Renewal Term" (hereinafter
defined), Tenant may, at Tenant's option, extend the Initial Term for a period
of Five (5) years commencing on the first day occurring after the end of the
Initial Term ("Renewal Term Commencement Date") and ending on the day
immediately preceding the 5th anniversary of the Renewal Commencement Date
("Renewal Term"). Tenant shall give Landlord notice of the exercise of Tenant's
option at least One Hundred Eighty (180) days prior to the expiration of the
Initial Term.
C. The Initial Term and the Renewal Term provided herein, if any, are
hereinafter collectively referred to as the "Term".
Section 2.3. Payment of Rent. Tenant agrees to pay to Landlord, at the
address provided for in Article XVII, each year during the Term of this Lease,
annual base rental in the sum of Thirty Thousand and 00/100 Dollars
($30,000.00). The annual base rent shall be payable in equal quarterly
installments in advance of Seven Thousand Five Hundred and 00/100 Dollars
($7,500.00), each installment to be due on the first day of each and every third
month of each "Lease Year" during the Term (Lease Year shall mean the 12-month
period commencing on the first day of the first full month following the
Commencement Date and each successive 12-month period thereafter during the
Term) provided, however, if the Commencement Date shall not occur on the first
day of a month, (i) the initial quarterly installment shall be due on the first
day of the first full month following the Commencement Date, and Tenant shall
pay to Landlord on the Commencement Date as rent for the partial month in which
the Commencement Date shall occur a sum equal to one monthly installment of the
annual base rent payable prorated to reflect the number of days in said partial
month, and (ii) the last quarterly installment due during the Term shall be
adjusted to reflect a payment due which is equal to a quarterly installment less
the prorated portion of the last calendar month which is not within the Term.
Section 2.4. Additional Rent. As additional rent, Tenant shall pay all
Impositions and all other sums due and payable hereunder. In the event of
Tenant's failure after any applicable grace or cure period to pay any sums,
costs, expenses or deposits which Tenant in any of the provisions of this Lease
assumes or agrees to pay and/or deposit, Landlord shall have (in addition to all
other rights and remedies) all of the rights and remedies provided for herein or
by law in the case of non-payment of rent.
Section 2.5. Net Lease. This Lease is a net lease and the Rent shall be
paid (i) without notice or demand, and without counterclaim, set-off, defense,
suspension or deferment,
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of any kind, and without deduction, abatement or diminution of any kind. Except
as otherwise expressly provided herein, this Lease shall not terminate, and
Tenant shall not have any right to terminate or avoid this Lease or be entitled
to the abatement (in whole or in part) of any rents hereunder or any reduction
thereof, nor shall the obligations and liabilities of Tenant hereunder be in any
way affected for any reason. The obligations of Tenant hereunder shall be
separate and independent covenants and agreements. Nothing in this Lease shall
prevent Landlord from suing the Tenant for damages or specific performance. Each
payment made by Tenant to Landlord pursuant to this Lease shall be final, and
Tenant shall not seek to recover all or any part of such payment from Landlord
for any reason whatsoever.
Section 2.6. Late Fee. In the event an installment of rent due hereunder is
not paid within ten (10) days after it becomes due, a late fee equal to ten
percent (10%) of the amount due will be charged.
ARTICLE III
DEVELOPMENT OF THE LAND
Section 3.1. Tenant's Obligation to Develop Land.
(a) Scope of Development. Tenant will improve the Land by constructing
thereon the Improvements pursuant to Plans and Specifications prepared by
Tenant. Landlord hereby grants and acknowledges its approval of such Plans and
Specifications and agrees that the approval rights set forth in Sections 3. 1
(c) and (d) hereof shall not apply to the initial construction of the
Improvements.
(b) Schedule of Performance. The Land shall be developed by Tenant in
accordance with the time schedule set forth in Exhibit B attached hereto (the
"Schedule of Performance"), subject to Unavoidable Delays. Tenant shall submit
to Landlord on or before each deadline set forth in the Schedule of Performance
satisfactory evidence of the satisfaction of such deadline. The satisfaction of
the matters set forth in the Schedule of Performance by the dates set forth
therefor is an essential part of this Lease, time being of the essence. In the
event that Landlord grants an extension of any such date, Landlord shall not be
deemed thereby to be waiving any other rights hereunder or implying the
extension of any other dates.
(c) Approvals for Alterations, Additions or Modifications of Improvements.
During the Term of this Lease, Tenant shall be entitled to perform or undertake
alterations, additions, improvements or construction (each an "Alteration") to,
in connection with, or in the Improvements and on the Land in accordance with
plans and specifications prepared by Tenant. Prior to undertaking any
Alteration, Tenant shall prepare and submit site plans, construction plans,
drawings and related documents to Landlord for written approval. Landlord shall
either approve or disapprove in writing any of the items submitted for approval
to Landlord within 30 days of Landlord's receipt thereof. Any disapprovals shall
be accompanied by a written explanation setting forth in detail the reasons for
disapproval. Failure by Landlord to express disapproval of any such item within
such 30 day period shall constitute Landlord's approval of such item. The
criteria used by Landlord in approving or disapproving any such item shall be
(1) quality of general design evaluated pursuant to customary industry
standards, and (2) the suitability of the landscaping on the Land to the
adjacent land owned by Landlord. In
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the event Landlord disapproves of any such item, Tenant shall cause such item to
be appropriately revised as soon as possible after receipt of a notice of
disapproval and resubmit the same to Landlord for approval pursuant to this
Section 3.1. Landlord and Tenant agree to cooperate reasonably each with the
other in resolving any objections of the other to such item and/or requested
modifications by the other. The provisions of this Section 3.1 with respect to
notice, time for and method of approval shall apply to any such revised item
resubmitted to Landlord for approval. Upon approval of any such item, whether
directly or through Landlord's failure to disapprove the item within the time
set forth in this Section 3.1, upon Tenant's request Landlord shall execute and
return a copy of such item to Tenant marked approved by Landlord with the date
of such approval.
It is understood and agreed that any approval issued by Landlord pursuant
hereto shall not constitute approval from any Governmental Authority which may
be required.
(d) Changes to Plans and Specifications. Tenant may make changes and
modifications which are not material to the plans and specifications for any
Alteration or to resolve a minor inconsistency or ambiguity without obtaining
Landlord's prior approval. No material modification or alteration may be made to
the plans and specifications for any Alteration without the prior written
consent of Landlord.
(e) Reports and Information. During the Construction Period, Tenant shall
provide to Landlord copies of all documents and correspondence relative solely
to the construction of the Improvements which it provides to the Leasehold
Mortgagee, it being understood and agreed that such documents and correspondence
shall not include the financial aspects of the construction or the Tenant.
Copies of all soils reports, surveys, hazardous wastes or toxic reports,
feasibility studies and other similar written materials prepared for Tenant with
respect to the Land shall be delivered to Landlord within ten (10) days after
receipt by Tenant.
(f) Obligation to Develop Land. Subject to Unavoidable Delays, Tenant
agrees to: (1) Commence Work on the Improvements, on or before the first day of
the 2nd full calendar month following the Commencement Date, in accordance with
the timetable set forth therefor in the Schedule of Performance and in
compliance with all Governmental Requirements and, (2) to diligently proceed to
substantially complete the lien-free completion of the Improvements in a good
and workmanlike manner and substantially in compliance with the Plans and
Specifications and other drawings pursuant to the Schedule of Performance on or
before the first day of the 12th full calendar month following the Commencement
of Work.
(g) Efforts to Sublease. To the extent Subleases are permitted hereunder,
Tenant shall at all times use diligent and commercially reasonable efforts to
enter into Subleases with Subtenants at market rentals which shall obligate the
Subtenant thereunder to pay or reimburse Tenant as sublessor thereunder for
Impositions, insurance, utilities, maintenance and other items of expense
(either on a net basis or above specified levels) relating to such Sublease
space, on terms reasonably consistent with general market conditions.
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(h) Use of Plans. The contracts with any architect, other design
professional or any general contractor shall provide, in form and substance
reasonably satisfactory to Landlord, for the assignment thereof to Landlord as
security to Landlord for Tenant's performance hereunder, and Landlord shall be
furnished with any such contract, together with the further agreement of the
parties thereto, that if this Lease is terminated due to Tenant's default,
Landlord may, at its election, use any Plans and Specifications to which Tenant
is then entitled pursuant to any such contract upon the payment of any sums due
to any party thereto. The above-described assignment and the Landlord's right to
elect to use the Plans and Specifications as described above shall be
subordinate to and shall not defeat or in any way interfere with the rights of
the Leasehold Mortgagee in and to any such contracts and Plans and
Specifications so assigned and Landlord shall execute such agreements as the
Leasehold Mortgagee may reasonably request to confirm such subordination.
(i) As-Built Plans and Specifications. Upon the Completion Date, Tenant
shall provide Landlord with a complete and legible full-size set of all as-built
Plans and Specifications (including all operating manuals for mechanical
systems) regarding all of the Improvements, as such Plans and Specifications may
be amended from time to time, within 30 days after such as-built Plans and
Specifications are prepared or after such amendment, as the case may be.
Section 3.2. Construction.
(a) Conditions to Commencement of Construction. Tenant shall satisfy the
following conditions in accordance with the time schedule set forth in the
Schedule of Performance and in no event shall Tenant commence any construction
on the Improvements until the following conditions have been satisfied or waived
by Landlord, in addition to other conditions and requirements imposed by this
Lease:
(1) Tenant shall have obtained all permits and other governmental
approvals necessary to commence such construction; and
(2) If Tenant intends to employ a general contractor for the
construction of the Improvements, Tenant shall have entered into a complete
and binding contract which such general contractor and said contract shall
be required to comply with all applicable Governmental Requirements.
(b) Restrictions: Governmental Permits. No Improvements shall be
constructed or maintained unless the same conform to and are consistent with
applicable zoning for the Land, all other applicable Governmental Requirements
(including without limitation any conditional use permit or other license,
permit, or certificate required to be issued by Governmental Authorities in
connection with the Improvements). Before commencement of construction or
development of the Improvements, Tenant shall, at Tenant's sole cost and
expense, secure any and all applicable permits, licenses and other approvals
which may be required by any Governmental Authority having jurisdiction over
such construction, development or work. Landlord shall provide its reasonable
cooperation to assist Tenant in securing any permit, license or approval
required in connection with Section 3.2(b); provided that Tenant shall pay all
reasonable costs and expenses of Landlord associated therewith, if any.
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Notwithstanding the foregoing sentence, Landlord shall have no implied
obligation to cause such permits to be issued. Tenant shall provide a copy of
each such permit, license or other approval to Landlord prior to commencing the
subject work or activity.
(c) Construction Standards. Subject to Unavoidable Delay, all construction,
alteration or repair work permitted herein shall be accomplished expeditiously,
diligently and in accordance with good engineering practices. Tenant shall take
all reasonably necessary measures to minimize any damage, disruption or
inconvenience caused by such work and make adequate provision for the safety and
convenience of all persons affected thereby. Tenant shall pay (or cause to be
paid) all costs and expenses associated with such work and shall indemnify and
hold Landlord harmless from all damages, lawsuits and claims attributable to the
performance of such work. Dust, noise and other effects of such work shall be
controlled using commercially accepted methods customarily utilized in order to
control deleterious effects associated with construction projects in a populated
or developed area.
(d) Costs of Construction. The entire cost and expense of constructing any
and all Improvements shall be borne and paid by Tenant.
(e) Rights of Access. For the purposes of assuring compliance with this
Lease, representatives of Landlord shall have the right of access to the Land
without charges or fees, at normal construction hours, during the period of
construction subject to the rights of Subtenants. Nothing in this Lease,
however, shall be interpreted to impose an obligation upon Landlord to conduct
such inspections or any liability in connection therewith.
(f) Subcontracts. All subcontracts entered into by Tenant and/or the
general contractor relating to the construction of the Improvements shall comply
with all applicable Governmental Requirements.
ARTICLE IV
TAXES AND ASSESSMENTS
Section 4.1. Real Property Taxes. Tenant covenants and agrees to pay all
Impositions when due during the term of this Lease.
Section 4.2. Tenant's Right to Contest. Tenant shall have the right at its
own expense to contest the amount or validity, in whole or in part, of any
Imposition by appropriate proceedings diligently conducted in good faith but
only after payment of such Imposition unless such payment would operate as a bar
to such contest or interfere with the production thereof, in which event,
notwithstanding the provisions of Section 4.1 hereof, payment of such Imposition
shall be postponed.
Upon the termination of such proceedings, it shall be the obligation of
Tenant to pay or cause to be paid the amount of such Imposition or part thereof
as finally determined in such proceedings and the payment of which may have been
deferred during the prosecution of such proceedings, together with any costs,
fees (including counsel fees), interest, penalties or other liabilities in
connection therewith which are deemed a part of an Imposition.
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ARTICLE V
USE OF DEMISED PREMISES
Section 5.1. Use. Tenant shall use the Demised Premises for the Project
only and for no other purpose.
Section 5.2. Title to Improvements and Fixtures. Subject to the provisions
of Article XXI, the Improvements are and shall be the property of the Tenant or
any party taking title through the Tenant by means of a deed in lieu of
foreclosure or foreclosure during, and only during, the Term of this Lease. At
all times during the Term of this Lease, the Improvements shall not be conveyed,
transferred or assigned unless such conveyance, transfer or assignment shall be
in compliance with the provisions of Article X, and at all such times the holder
of the Leasehold Estate shall be the owner of the Improvements.
Section 5.3. Environmental Compliance. Tenant shall comply with, and shall
include covenants in the Subleases with all of its Subtenants to cause them to
comply with, federal, state and local laws, ordinances or regulations relating
to: (1) industrial hygiene, (2) the environmental conditions on, under or about
the Demised Premises including, but not limited to, soil and groundwater
conditions, and (3) the use, generation, manufacture, production, storage or
disposal on, under, or about the Demised Premises or transportation to or from
the Demised Premises of flammable explosives, radioactive materials, hazardous
wastes, toxic substances or related injurious materials, whether injurious by
themselves or in combination with other materials (collectively, "Hazardous
Materials"). For the purpose of this Lease, Hazardous Materials shall include
but not be limited to substances defined as "hazardous substances," "hazardous
materials," or "toxic substances" in the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et
seq.; the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801 et
seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et
seq.; Articles 15 and 27 of the New York State Environmental Conservation Law;
and in the regulations adopted and publications promulgated from time to time
pursuant to said laws.
ARTICLE VI
REPAIRS COMPLIANCE WITH LAWS, ALTERATIONS
Section 6.1. Repairs. Tenant shall at all times during the Term of this
Lease, at Tenant's sole cost and expense, keep the Demised Premises, the
Improvements and all sidewalks, driveways, parking lots and curbs adjacent
thereto in good order, condition and repair, ordinary wear and tear excepted,
and in such condition as may be required by law and by the terms of any
insurance policies carried by Tenant, whether or not such repair shall be
interior or exterior, and whether or not such repair shall be of a structural
nature, and whether or not the same can be said to be within the present
contemplation of the parties hereto.
Section 6.2. Compliance with Laws. Tenant shall at all times during the
Term of the Lease, at Tenant's own cost and expense, perform and comply with all
laws, rules, orders, ordinances, regulations, and requirements now or hereafter
enacted or promulgated, of every Governmental Authority, and of any agency
thereof, relating to the Demised Premises, or the Improvements, or the
facilities or equipment therein, or the streets, sidewalks, vaults, vault
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spaces, curbs and gutters adjoining the Demised Premises, or the appurtenances
to the Demised Premises, or the franchises and privileges connected therewith,
whether or not such laws, rules, orders, ordinances, regulations, or
requirements so involved shall necessitate structural changes, improvements,
interference with use and enjoyment of the Demised Premises, replacements, or
repairs, extraordinary as well as ordinary, and Tenant shall so perform and
comply, whether or not such laws, rules, orders, ordinances, regulations or
requirements shall now exist or shall hereafter be enacted or promulgated, and
whether or not such laws, rules, orders, ordinances, regulations or requirements
can be said to be within the present contemplation of the parties hereto.
Tenant shall have the right, provided it does so with due diligence and
dispatch, to contest by appropriate legal proceedings, without cost or expense
to Landlord, the validity of any law, rule, order, ordinance, regulation or
requirement of the nature hereinabove referred to in this Article VI. Tenant may
postpone compliance with such law, rule, order, ordinance, regulation, or
requirement until the final determination of such proceedings, only so long as
such postponement of compliance will not subject Landlord to any criminal
prosecution, or any other liability of any kind against the reversion of the
Demised Premises or the Improvements thereon which may arise by reason of
postponement or failure of compliance with such law, rule, order, ordinance,
regulation, or requirement, and Tenant shall indemnify and hold Landlord
harmless from the same. No provisions of this Lease shall be construed so as to
permit Tenant to postpone compliance with such law, rule, order, ordinance,
regulation or requirement if any sovereign, municipal, or other governmental
authority shall threaten to carry out any work to comply with the same or to
foreclose or sell any lien affecting all or any part of the Demised Premises
which shall have arisen by reason of such postponement or failure of compliance.
Section 6.3. Alterations. Tenant shall have the right to make any
alteration. addition or modification to the Demised Premises or the Improvements
provided such alteration, addition or modification is (i) in compliance with all
applicable Governmental Requirements, (ii) consistent with and a part of the
stated use and purpose of the Improvements set forth in Section 1.1 and (iii)
constructed pursuant to and in accordance with Article III provided, however,
the requirements contained in (iii) shall not apply in the case of an interior
alteration costing less than $250,000.00 including labor and materials.
ARTICLE VII
INSURANCE
Section 7.1. Public Liability. Tenant shall secure and maintain
comprehensive general public liability insurance for bodily injury, death, or
property damage occurring on, in or about the Demised Premises, which insurance
shall have total combined single limits of not less than Five Million Dollars
($5,000,000) per occurrence. Such insurance shall have no deductible. If, by
reason of changed circumstances or economic conditions the insurance amounts
referred to in this Lease become inadequate in Landlord's judgment reasonably
exercised, Tenant shall increase the amounts of such insurance promptly upon
Landlord's request.
Section 7.2. Coverage Requirements. Any insurance carried or secured by
Tenant in connection with the Demised Premises shall be carried in favor of
Landlord, Tenant and the Leasehold Mortgagee as the parties insured and shall
fully protect Landlord, Tenant and
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Leasehold Mortgagee as their respective interests may appear. Such insurance
shall be written by companies that are nationally recognized and authorized to
do business in New York State and acceptable to Landlord, such acceptance not to
be unreasonably withheld.
Section 7.3. Cancellation; Non-Renewal. Every policy referred to in Section
7.1 of this Lease shall, to the extent obtainable, provide that (a) no
cancellation, non-renewal, reduction or material amendment in the coverage
afforded under said policies will be effective until at least 30 days' prior
written notice of such cancellation, non-renewal, reduction or material
amendment has been given to Landlord in accordance with Article XVII of this
Lease and (b) that the interests of the Landlord shall not be invalidated by any
act or negligence of Tenant or Landlord or any person or entity having an
interest in the Demised Premises, by occupancy or use of the Demised Premises
for purposes more hazardous than permitted by such policy, or by any foreclosure
or other proceedings relating to the Demised Premises. Tenant shall promptly
advise Landlord of any policy cancellation, reduction, non-renewal or amendment
which adversely affects Landlord.
Section 7.4. Copies of Policies. Prior to the effective date for any
insurance required by this Article, Tenant shall deliver to Landlord either
certified copies of the policies for such insurance or certificates of insurance
reasonably satisfactory to Landlord evidencing the existence of all insurance
coverages that are required to be maintained by Tenant under this Article. Any
insurance required under this Article may be provided under such blanket
policies as are then customary for other properties owned, leased or occupied by
Tenant, provided that the coverage allocated to or available for the Demised
Premises, and the interest of the Landlord thereon, is not less than the
coverage required by this Article as separately stated.
ARTICLE VIII
DESTRUCTION AND RESTORATION
Section 8.1. Tenant's Restoration of Improvements. In case of damage to or
destruction of the Improvements or any part thereof by fire or other cause,
Tenant, at its option and its sole cost and expense, shall either (i) restore
the same as nearly as possible to their value, condition and character
immediately prior to such damage or destruction, or (ii) terminate the Lease.
Tenant shall notify Landlord of its election to restore the Improvements or
terminate the Lease before the 30th day after the fire or other casualty. In the
event Tenant elects to restore the Improvements, such restoration shall be
commenced with due diligence and in good faith, and prosecuted with due
diligence and in good faith, Unavoidable Delays excepted. In the event Tenant
elects to terminate the Lease, Tenant shall, at Landlord's option, raze the
Improvements so damaged or destroyed. The duty imposed by this provision, if so
exercised by Landlord, to raze the Improvements shall include, but not be
limited to, the duty to demolish and remove all basements and foundations, fill
all excavations, return the surface to grade and leave the premises safe and
free from debris and hazards. Nothing contained in this section shall modify
Landlord's right to acquire title to the Improvements as otherwise set forth in
this Lease.
Section 8.2. Application of Insurance Proceeds. In the event Tenant elects
to restore the Improvements pursuant to Section 8.1, all insurance proceeds paid
as provided herein, on account of any damage, loss or destruction, less the
actual cost, fees and expenses, incurred by Tenant, Landlord or any Leasehold
Mortgage in connection with the adjustment of any such
11
damage, loss or destruction, which costs and expenses shall be paid to Landlord
or any Leasehold Mortgagee, as the case may be, shall be applied, (subject to
reasonable provisions for the disbursement thereof included in any Leasehold
Mortgage) toward the payment of the cost of restoration, repairs, replacements,
rebuilding or alterations, including the cost of demolition and temporary
repairs and for the protection of property pending completion of permanent
restoration, repairs, replacements, rebuilding or alterations (all of which
temporary repairs, protection of property and permanent restoration, repairs,
replacement, rebuilding or alterations are hereinafter collectively referred to
as the "Restoration"), and, subject to reasonable terms for disbursement
included in any Leasehold Mortgage, shall be paid out from time to time to
Tenant or in accordance with its directions, as such Restoration progresses,
upon the written request of Tenant which shall be accompanied by all
certificates, invoices. and releases that may then be necessary to protect
Landlord and the Demised Premises from any lien, charge or liability and by the
written approval of the Leasehold Mortgagee, if any, or Landlord if there is
then no Leasehold Mortgagee.
Upon compliance with the foregoing provisions of this Section, out of such
insurance money there shall be paid to Tenant or to such person(s) as may be
reasonably designated by Tenant the respective amount stated in such request to
have been paid by Tenant or to be due to such person(s), as the case may be.
If the insurance money, less the actual cost, fees and expenses, if any,
incurred by Landlord, Tenant and/or the Leasehold Mortgagee in connection with
the adjustment of the loss (the "Net Insurance Proceeds"), shall be insufficient
in the reasonable judgment of Landlord to pay the entire cost of such
Restoration, Tenant shall, to Landlord's reasonable satisfaction, arrange to pay
the deficiency prior to commencement or continuation of construction.
Additionally, if the estimated cost of such Restoration exceeds the Net
Insurance Proceeds by either (a) 5% of the then market value of the Improvements
at the time of such Restoration, or (b) 10% of the value of Tenant's equity in
the Improvements, Landlord may require Tenant, at Tenant's sole cost and
expense, to furnish Landlord with a performance bond and surety bond or other
assurances of completion as shall be satisfactory to Landlord.
Subject to the reasonable terms for disbursement included in any Leasehold
Mortgage, upon the completion and payment in full of the Restoration and the
expiration of all applicable lien periods, and so long as there is no default
under the terms, conditions, covenants and agreements of this Lease, any balance
of the insurance proceeds remaining to be paid shall be paid to Tenant or to
Leasehold Mortgagee, as their interests may appear.
Section 8.3. No Release of Tenant's Obligations. No destruction of, or
damage to the Improvements or any part thereof by fire or any other cause shall
permit Tenant to surrender this Lease or shall relieve Tenant from its
obligations to pay the full Rent payable under this Lease or from any of its
other obligations under this Lease, and Tenant waives any rights now or
hereafter conferred upon it by statute or otherwise to quit or surrender this
Lease or the Demised Premises or any suspension, diminution, abatement or
reduction of rent on account of any such destruction or damage, including
specifically the provisions of Section 227 of the New York Real Property Law.
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ARTICLE IX
FEE MORTGAGES
Section 9.1. Current Mortgage. Landlord currently represents that the Land
is not currently subject to any mortgage.
Section 9.2. Future Mortgages. Landlord covenants that any mortgage
encumbering the Land during the term hereof shall contain a provision
substantially similar to the following:
"That neither the mortgagee, its successors
or assigns, nor any purchaser at a
foreclosure sale under such mortgage, nor any
transferee under a deed in lieu of
foreclosure under such mortgage shall have
any greater rights with respect to [this
Lease] than the rights granted to the
landlord under the terms of [this Lease]."
ARTICLE X
ASSIGNMENT, SUBLETTING, ETC.
Section 10.1. Prohibited Transfers.
(a) No Rights to Successors. No voluntary or involuntary successor in
interest shall acquire any rights or powers under this Lease.
(b) No Assignment. Tenant may not assign this Lease or any interest herein,
or otherwise sell, transfer or convey any right, title or interest Tenant may
have in the Demised Premises, without first obtaining the written consent of
Landlord which consent may be withheld by Landlord in its sole and absolute
discretion. Notwithstanding the immediately preceding sentence to the contrary,
Landlord's consent shall not be required for an assignment of this Lease to an
"Affiliated Entity" (hereinafter defined). An Affiliated Entity shall be any
corporation, partnership, joint venture or trust, at least 50% of the
outstanding stock or partnership or joint venture interest or beneficial
interest, as the case may be, of which is owned by Tenant. Notwithstanding any
assignment to an Affiliated Entity, Tenant shall remain liable under this Lease
and Landlord shall be permitted to enforce the provisions of this Lease against
Tenant without proceeding in any way against any other person or entity,
provided however, the aforesaid liability of Tenant shall terminate upon the
occurrence of the Completion Date except as to liability of Tenant under the
Lease which has accrued prior to the Completion Date.
(c) Transfers Requiring Approval and Exceptions. If Tenant is a
partnership, joint venture, trust or corporation, any direct or indirect sale,
assignment or other transfer of 50% or more of the partnership or joint venture
interest (whether in one transaction or as a result of a series of transactions)
or any direct or indirect sale, assignment or other transfer of the beneficial
interest in the case of a trust (whether in one transaction or as a result of a
series of transactions) or any direct or indirect sale, assignment or other
transfer of 50% or more of the outstanding voting stock, or of any class of
voting stock if there is more than one such class, of such a corporation
(whether in one transaction or as a result of a series of transactions) shall
constitute an Assignment by Tenant of this Lease for the purposes of this
Section and shall not be
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permitted to occur without first obtaining the written consent of Landlord
pursuant to Section 10.2.
Section 10.2. Landlord's Consent to Assignments.
(a) Generally. If Tenant receives the prior written consent of Landlord, it
may assign all, but only all, of its right, title and interest in this Lease and
the Improvements.
(b) Limitation on Damages. If Tenant judicially contests any disapproval,
it is agreed that no damages shall be payable to Tenant in any such action.
(c) No Waiver. Landlord's approval of or consent to any proposed Assignment
shall not be a waiver of any right to object to further or future subleasings or
Assignments, and Landlord's consent to each such successive Assignment must be
first obtained in writing from Landlord.
(d) Assumption of Tenant's Obligations. Before any proposed Assignment can
be effective for any purpose under this Lease, including but not limited to an
assignment to an Affiliated Entity, the proposed Assignee must assume in writing
the performance of all of the terms, covenants and conditions on the part of
Tenant to be performed hereunder from and after the date of such Assignment.
Section 10.3. Assignment Invalid. Any transfer or Assignment to which
Landlord has consented shall be void and shall confer no right of occupancy upon
the proposed Assignee unless and until a written assumption pursuant to Section
10.2(d) by the proposed Assignee is received by Landlord.
Section 10.4. Permitted Subletting.
(a) Generally. Tenant may not enter into a Sublease without first obtaining
Landlord's prior written consent which consent may be withheld by Landlord in
its sole and absolute discretion. Any Subleases to which Landlord has consented
shall be expressly subject to the terms of this Lease and the following
additional criteria (together with any other criteria established by Landlord in
its sole and absolute discretion):
(1) Independent Subtenants. Except as otherwise provided in
subparagraph (c) hereof, all Subleases shall be with independent third
parties who are not Affiliates and shall be based on arm's-length
negotiations between Tenant and such independent third parties.
(2) Subordination of Subleases. All Subleases shall provide that they
shall be subject and subordinate not only to this Lease, but also to any
new lease made by Landlord as provided in Article XI.
(3) Consistent with Nature of Project. All Subleases shall be for use
which is consistent with the nature of the Improvements.
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(4) Right of Disapproval. It is agreed that Landlord shall not be
liable for any damages in connection with its disapproval of any Sublease.
(b) Notwithstanding any permitted subletting, Tenant shall, at all times,
remain liable for the performance of all of the covenants and agreements under
this Lease on its part to be so performed.
(c) Notwithstanding anything contained in this Article to the contrary,
Landlord's consent shall not be required for a subletting to an Affiliated
Entity provided such sublease is in compliance with subparagraphs (a)(2) and
(a)(3) hereof..
ARTICLE XI
LEASEHOLD MORTGAGES
Section 11.1. Leasehold Mortgages. Tenant shall have the right at any time
and from time to time to mortgage its interest in this Lease under one or more
Leasehold Mortgages, and to assign this Lease and any Sublease(s) as collateral
security for such Leasehold Mortgage(s). If Tenant shall mortgage this Lease and
if the Leasehold Mortgagee shall send to Landlord a true copy of the Leasehold
Mortgage together with written notice specifying the name and address of the
Leasehold Mortgagee, Landlord agrees that so long as any such Leasehold Mortgage
shall remain unsatisfied of record or until written notice of satisfaction is
given by the holder thereof to Landlord, the following provisions shall apply:
(a) There shall be no cancellation, surrender or modification of this Lease
by joint action of Landlord and Tenant without the prior consent in writing of
the Leasehold Mortgagee.
(b) Landlord shall, upon serving Tenant with any notice of Default (which
notice shall specify the nature of the Default) or termination, simultaneously
serve a copy of such notice upon the Leasehold Mortgagee. The Leasehold
Mortgagee shall thereupon have the same period as provided the Tenant, after
service of such notice upon it, to remedy or cause to be remedied the defaults
complained of, and the Landlord shall accept such performance by or at the
instigation of such Leasehold Mortgagee as if the same had been done by Tenant;
provided however, upon the occurrence of an Event of Default under Section
16.1(a), Leasehold Mortgagee shall have thirty (30) days after written notice
from Landlord to remedy or cause to have remedied such default thereunder.
Section 11.2. Nullification of Defaults. Notwithstanding anything to the
contrary herein contained, if any Default shall occur which pursuant to any
provision of this Lease entitles Landlord to terminate this Lease and if, before
the expiration of thirty (30) days from the date of service of a copy of the
notice of termination upon a Leasehold Mortgagee pursuant to Section 11.1(b),
the leasehold Mortgagee shall have notified Landlord of its desire to nullify
such notice (such notification from the Leasehold Mortgagee being herein
referred to as a "Nullification Notice"), then in such event Landlord shall not
be entitled to terminate this Lease by reason of the Default specified in the
Nullification Notice and any notice of termination theretofore given shall be
void and of no effect, provided that within thirty (30) days after service of
the Nullification Notice the Leasehold Mortgagee shall have cured any monetary
Defaults
15
then existing hereunder and shall either have (a) complied or commenced the work
of complying with any nonmonetary obligations then in default (and diligently
and continuously prosecutes same to completion) or (b) acquired or sold or
commenced the process of acquiring or selling Tenant's interest in this Lease by
foreclosure of the Leasehold Mortgage or otherwise.
Section 11.3. Curing of Defaults. If Landlord's notice of termination shall
have been nullified pursuant to Section 11.2, Landlord shall not have the right
subsequently to terminate this Lease so long as the Leasehold Mortgagee or its
nominee or successor continues to pay the Rent due hereunder and either (a) the
Leasehold Mortgagee or its nominee proceeds with reasonable diligence to
complete or cause the completion of the work of curing non-monetary Defaults
(and diligently and continuously prosecutes same to completion), or (b) the
Leasehold Mortgagee or its nominee proceeds with reasonable diligence to acquire
or sell Tenant's interest in this Lease by foreclosure or otherwise and
following such acquisition or sale, the Leasehold Mortgagee or its nominee or
any purchaser or assignee of Tenant's interest in this Lease proceeds with
reasonable diligence to complete or cause the completion of the work of curing
non-monetary Defaults, which are susceptible of cure by Leasehold Mortgagee or
its nominee. The giving of a notice of Default or termination by Landlord
pursuant to the provisions of this Article does not impair Landlord's right to
give, nor impair Tenant's and the Leasehold Mortgagee's right to receive, such
notices for other Defaults that may arise hereunder, and the giving of such
notices shall be subject to the provisions of this Article.
Section 11.4. Replacement Leases. Landlord agrees that, in the event of a
termination of this Lease, Landlord shall upon request of any Leasehold
Mortgagee (and whether or not a Nullification Notice may have been given) enter
into a new lease of the Land with the Leasehold Mortgagee or its nominee for a
term equal to what would have been the remainder of the term of this Lease if
this Lease had not been terminated, which new lease shall be effective as of the
date of such termination and shall be at the same Rent and upon the same terms,
provisions, covenants and agreements as are herein contained (including any
right to extend the term of this Lease and the provisions set forth in this
Article XI), subject only (a) to the same conditions of title as this Lease is
subject to on the date of the execution hereof and any liens or encumbrances or
other matters (i) which were caused or created by Tenant, (ii) which are
required by law or (iii) which the Tenant was obligated to discharge under the
terms of this Lease and (b) to the rights, if any, of parties then in possession
of any part of the Demised Premises, provided that:
(a) Said Leasehold Mortgagee shall make written request upon Landlord
for such new lease within thirty (30) days after the termination of this
Lease;
(b) Said Leasehold Mortgagee or its nominee executes and delivers such
new lease within thirty (30) days after the execution and delivery of the
new lease by Landlord to said Leasehold Mortgagee in response to the
request made pursuant to subparagraph (a) above;
(c) Said Leasehold Mortgagee or its nominee shall pay to Landlord at
the time of the execution and delivery of said new lease any and all sums
which would at the time of the execution and delivery thereof be due
pursuant to this Lease but for such termination, together with any costs
and expenses, including reasonable attorney's fees, which Landlord shall
have incurred by reason of such Default;
16
(d) Said Leasehold Mortgagee or its nominee upon the execution of such
new lease cures within thirty (30) days thereof (unless such Default
requires work to be performed, acts to be done, or conditions to be removed
which cannot by their nature reasonably be performed, done or removed, as
the case may be, within such thirty (30) day period in which case no
Default shall be deemed to exist so long as Leasehold Mortgagee or its
nominee shall have commenced curing the same within such thirty (30) day
period and shall diligently and continuously prosecute the same to
completion) all non-monetary Defaults of which it has notice (and which are
susceptible of cure by Leasehold Mortgagee or its nominee) remaining
uncured under this lease as of the date of execution and delivery of the
new lease;
(e) Landlord shall not warrant possession of the Demised Premises to
the tenant under the new lease or title to the Improvements, but the tenant
under such new lease shall have the same right, title and interest in and
to the Improvements as Tenant had therein and thereto prior to the
termination of this Lease; and
(f) Such new lease shall be made expressly subject to the rights, if
any, of the Tenant under this Lease.
Section 11.5. Written Assurances. Landlord shall upon Tenant's request
execute, acknowledge and deliver to Tenant and/or each Leasehold Mortgagee an
agreement prepared at the cost and expense of Tenant and in form satisfactory to
such Leasehold Mortgagee, confirming all or any of the provisions of this
Article.
Section 11.6. Landlord's Costs and Expenses. The Leasehold Mortgagee
receiving any new lease pursuant to the provisions of this Article shall pay all
of Landlord's reasonable costs and expenses (including attorney's fees) incident
to Landlord's entering into such new lease.
Section 11.7. No Merger. So long as any Leasehold Mortgage is in existence,
unless all Leasehold Mortgagees shall otherwise expressly consent in writing,
the fee title to the Land and the Leasehold Estate shall not merge, but shall
remain separate and distinct, notwithstanding the acquisition of both fee title
to the Demised Premises and the Leasehold Estate by Landlord, or by Tenant, or
by any Leasehold Mortgagee, or by any other party.
Section 11.8. Priority. In the event that there is more than one Leasehold
Mortgage affecting the Leasehold Estate, the most senior Leasehold Mortgage has
priority in terms of exercising the rights of a Leasehold Mortgagee pursuant to
the provisions of this Article. Notwithstanding the immediately preceding
sentence to the contrary, the aforesaid rights may be exercised under a
Leasehold Mortgage, other than the most senior Leasehold Mortgage, provided a
written intercreditor agreement is submitted to Landlord which evidences the
authority of said Leasehold Mortgagee to exercise said rights.
Section 11.9. Leasehold Mortgage Assignment. Leasehold Mortgagee may assign
this Lease provided (i) an assumption agreement is executed by said assignee
pursuant to Section 10.2(d) and (ii) said assignee has a financial net worth
sufficient to discharge the obligations of Tenant hereunder as determined by
Landlord in its discretion reasonably exercised.
17
Section 11.10. Option Rights. In the event Leasehold Mortgagee shall
acquire Tenant's leasehold interest hereunder, Leasehold Mortgagee shall have
all of Tenant's rights hereunder, including, but not limited to, Tenant's rights
under Article XXIX, and be subject to all obligations of Tenant under this Lease
except as may be otherwise expressly provided herein.
ARTICLE XII
REPRESENTATIONS BY LANDLORD
Section 12.1. Representations by Landlord. Tenant accepts the Demised
Premises in the existing condition, and Tenant agrees that except as may be
specifically set forth in this Lease, no representations, statement or
warranties, express or implied, have been made by or on behalf of Landlord in
respect thereof or in respect of the condition thereof or the use or occupation
that may be made thereof and that Landlord shall in no event whatsoever be
liable for any latent or patent defects therein. Notwithstanding the immediately
preceding sentence, Landlord represents, solely to Leasehold Mortgagee, (i) upon
information and belief without independent inquiry that the building permits for
the construction of the Improvements, have been issued by the Municipality and
(ii) attached hereto as Exhibit "E" is a copy of the resolution of the common
council of the Municipality evidencing the approval by the Municipality of the
Contract and this Lease.
ARTICLE XIII
LANDLORD NOT LIABLE FOR INJURY OR DAMAGE
Section 13.1. Landlord Not Liable. Except for injury, loss or damage caused
by the negligent acts of Landlord, its agents, servants, employees or
contractors, Landlord shall not in any event whatsoever be liable for any injury
or damage to any property or to any person happening on, in or about the Demised
Premises or the appurtenances thereto, nor for any injury or damage to the
Demised Premises, or to any property belonging to Tenant or any other person
which may be caused by any fire, breakage, leakage or defect or by water, rain
or snow that may leak into, issue or flow from any part of the Demised Premises
or which may arise from any other cause whatsoever.
ARTICLE XIV
INDEMNIFICATION OF LANDLORD AND TENANT
Section 14.1. Indemnification of Landlord. In addition to any other
indemnities to Landlord specifically provided in this Lease, Tenant shall
indemnify and save harmless Landlord against and from all liabilities, suits,
obligations, fines, damages, penalties, claims, costs, charges and expenses,
including reasonable attorneys fees, which may be imposed upon or incurred by or
asserted against Landlord, its agents or employees by reason of any of the
following occurring during the term of this Lease:
(a) any work or thing done in, on or about the Demised Premises or any
part thereof;
(b) any use, non-use, possession, occupation, alteration, repair,
condition, operation, maintenance or management of the Demised Premises, or
any part thereof or of any street, alley, sidewalk, curb, vault, passageway
or space adjacent thereto;
18
(c) any negligence on the part of Tenant or any subtenant or any of
its or their agents, contractors, servants, employees or licensees;
(d) any accident, injury (including death) or damage to any person or
property occurring in, on or about the Demised Premises or any part thereof
or in, on or about any street, alley, sidewalk, curb, vault, passageway or
space adjacent thereto;
(e) any failure on the part of Tenant to perform or comply with any of
the covenants, agreements, terms or conditions contained in this Lease or
any easements, sublease, license or concession agreement on its part to be
performed or complied with;
(f) any liability which may be asserted against Landlord relating to
(i) the use of the Demised Premises or (ii) a default or breach under the
Contract but only to the extent that Tenant has "Contract Obligations" (as
defined in section 28.3) thereunder pursuant to Section 28.3 hereof; and
(g) any and all liabilities, claims and causes of action arising under
the terms and conditions of every sublease, license or concession
agreement.
The indemnities in favor of Landlord contained in this Section and any
other indemnity specifically provided to Landlord under this Lease shall survive
the termination of this Lease.
Section 14.2. Negligence of Landlord. Notwithstanding anything to the
contrary contained in this Lease, Tenant shall not indemnify Landlord or relieve
Landlord from responsibility to Tenant for any injury, loss or damage caused by
the negligent or improper acts or omissions of Landlord, its agents, servants,
employees or contractors or any acts or omissions of Landlord, its agents,
servants, employees or contractors in violation of the terms of this Lease.
Section 14.3. Indemnification of Tenant. Landlord shall indemnify and save
harmless Tenant against and from all liabilities, suits, obligations, fines,
damages, penalties, claims, costs, charges, and expenses, including reasonable
attorney's fees, which may be imposed upon or incurred by or asserted against
Tenant, its agents or employees, by reason of any default by Landlord under this
Lease or the Contract. The indemnities in favor of Tenant contained in this
Lease shall survive the termination of this Lease.
Section 14.4. Notice of Claim. Tenant or Landlord as the case may be, shall
be given notice of any claim which might give rise to its obligation to
indemnify Landlord or Tenant as the case may be pursuant to the terms of this
Lease.
ARTICLE XV
LANDLORD MAY CURE DEFAULTS
Section 15.1. Cure By Landlord. If Tenant shall be in default in the
performance of any of its obligations under this Lease beyond any applicable
notice or cure period, Landlord may do whatever is reasonably necessary to cure
such default for the account and at the expense of Tenant; and the amount of any
payment made or expense incurred by Landlord for such purpose, with interest
thereon at highest rate permitted by law, shall be
19
deemed additional rent and shall be paid by Tenant to Landlord on demand,
provided however, that Landlord shall be under no obligation to cure said
default. Notwithstanding any provision of this Lease to the contrary, in the
event Landlord elects to exercise its rights under this Section 15. 1, Landlord
shall give five (5) days prior notice thereof to Tenant and Leasehold Mortgagee.
ARTICLE XVI
DEFAULTS, CONDITIONAL LIMITATIONS, REMEDIES, ETC.
Section 16.1. Events of Default. Each of the following events shall be an
"Event of Default" hereunder:
(a) Failure of Tenant to pay any installment of Rent or any part
thereof or any other payment of money, costs or expenses herein agreed to
be paid by Tenant, when due, and the continuance of such failure for a
period of ten (10) days after written notice from Landlord specifying such
failure;
(b) Failure of Tenant to observe or perform one or more of the other
terms, conditions, covenants or agreements of this Lease and the
continuance of such failure for a period of thirty (30) days after written
notice by Landlord specifying such failure;
(c) Tenant vacates or abandons the Premises;
(d) Except as may be otherwise permitted under the terms of this Lease
for the benefit of a Leasehold Mortgagee, this Lease or the Demised
Premises or any part of the Demised Premises are taken upon execution or by
other process of law directed against Tenant, or are taken upon or subject
to any attachment at the instance of any creditor or claimant against
Tenant, and the attachment is not discharged or disposed of within sixty
(60) days after its levy.
(e) Tenant files a petition in bankruptcy or insolvency or for
reorganization or arrangement under the bankruptcy laws of the United
States or under any insolvency act of any state, or admits the material
allegations of any such petition by answer or otherwise, or is dissolved or
makes an assignment for the benefit of creditors.
(f) Involuntary proceedings under any such bankruptcy law or
insolvency act or for the dissolution of Tenant are instituted against
Tenant, or a receiver or trustee is appointed for all or substantially all
of the property of Tenant, and such proceeding is not dismissed or such
receivership or trusteeship vacated within ninety (90) days after such
institution or appointment.
(g) Tenant fails to take physical possession of the Premises on the
Commencement Date.
(h) A default by Tenant under the "Option Contract" (hereinafter
defined).
Section 16.2. Termination Upon Default. Subject to the provisions of
Article XI and Article XXIX, if an Event of Default shall occur (and be
continuing), Landlord, at any time thereafter, may at its option give written
notice to Tenant stating that this Lease and the term hereby demised shall
expire and terminate on the date specified in such notice, and upon the date
specified in such notice, this Lease and the term hereby demised and all rights
of the Tenant
20
under this Lease shall expire and terminate as if that date were the date herein
definitely fixed for the termination of the term of this Lease, and Tenant shall
quit and surrender the Demised Premises.
Section 16.3. Recovery of Demised Premises. Subject to the provisions of
Article XI and Article XXIX, if any Event of Default shall occur, Landlord may
without notice re-enter and repossess the Demised Premises expel Tenant and
those claiming through or under Tenant and remove the effects of both or either
using such force for that purpose as may be necessary and proper under
applicable law without being liable to indictment, prosecution or damages
therefor.
Section 16.4. Damages. In the event of the termination of this Lease, or
the re-entry or repossession of the Demised Premises (as above set forth)
Landlord shall be entitled to such remedies, rights and damages as are granted
by applicable law including, but not limited to, acceleration of Rent.
Section 16.5. Receipt of Monies. No receipt of monies by Landlord from
Tenant after termination of this Lease, or after the giving of any notice of
termination of this Lease, shall reinstate, continue or extend the term of this
Lease or affect any notice theretofore given to Tenant, or operate as a waiver
of the right of Landlord to enforce the payment of Rent and any other sum or
sums of money and other charges herein reserved and agreed to be paid by Tenant
then due or thereafter falling due, or operate as a waiver of the right of
Landlord to recover possession of the Land by proper remedy.
Section 16.6. Waiver. Subject to the provisions of Article XI, no failure
by Landlord or Tenant to insist upon the strict performance of any covenant,
agreement, term or condition of this Lease or to exercise any right or remedy
consequent upon a breach thereof, and no acceptance of full or partial Rent by
Landlord during the continuance of any such breach, shall constitute a waiver of
any such breach or of such covenant, agreement, term or condition. No covenant,
agreement, term or condition of this Lease to be performed or complied with by
Tenant or Landlord, and no breach thereof, shall be waived, altered or modified
except by a written instrument executed by both Landlord and Tenant. No waiver
of any breach shall affect or alter this Lease, but each and every covenant,
agreement, term and condition of this Lease shall continue in full force and
effect with respect to any other then existing or subsequent breach thereof.
Section 16.7. Acceleration of Rent. Subject to the provisions of Article
XI, if any Event of Default shall occur, Landlord may accelerate all Rent
required to be paid by Tenant under the terms of this Lease during the balance
of the Term and declare the same to be immediately due and payable by giving
Tenant notice of such acceleration and declaration.
Section 16.8. Right to Relet and Damages Upon Reentry. Subject to the
provisions of Article XI, should Landlord elect to reenter as provided in
Section 16.3, or should Landlord take possession pursuant to legal proceedings
or pursuant to any notice provided by law, Landlord may, from time to time,
without terminating this Lease, relet the Demised Premises or any part of the
Demised Premises in Landlord's or Tenant's name, but for the account of Tenant,
for such term or terms (which may be greater or less than the period which
21
would otherwise have constituted the balance of the Term) and on such conditions
and upon such other terms (which may include concessions of free rent and
alteration and repair of the Demised Premises) as Landlord, in Landlord's sole
discretion, may determine, and Landlord may collect and receive the rent.
Landlord will in no way be responsible or liable for any failure to relet the
Demised Premises or any part of the Demised Premises, or for any failure to
collect any rent due upon such reletting. No such reentry or taking possession
of the Demised Premises by Landlord will be construed as an election on
Landlord's part to terminate this Lease unless a notice of such intention is
given to Tenant. No such reentry or repossession of the Demised Premises shall
relieve Tenant of its liability and obligations under this Lease, all of which
shall survive such reentry or repossession. Landlord reserves the right
following any such reentry or reletting to exercise Landlord's right to
terminate this Lease by giving Tenant such notice, in which event this Lease
will terminate as specified in such notice.
If Landlord does not elect to terminate this Lease as permitted in Section
16.2, but elects to take possession as provided in Section 16.3, Tenant will pay
to Landlord: (a) Rent and other sums as provided in this Lease, which would be
payable under this Lease if such repossession had not occurred, less (b) the net
proceeds, if any, of any reletting of the Premises after deducting all
Landlord's reasonable expenses in connection with such reletting, including,
without limitation, all repossession costs, brokerage commissions, attorneys'
fees, expenses of employees, alteration and repair costs and expenses of
preparation for such reletting. If, in connection with any reletting, the new
lease term extends beyond the existing Term, or the premises covered by such new
lease include other premises not part of the Premises, a fair apportionment of
the rent received from such reletting and the expenses incurred in connection
with such reletting as provided in this Section will be made in determining the
net proceeds from such reletting, and any rent concessions will be equally
apportioned over the term of the new lease. Tenant will pay such rent and other
sums to Landlord monthly on the day on which the Rent would have been payable
under this Lease if possession had not been retaken, and Landlord will be
entitled to receive such Rent from Tenant on each such day.
Section 16.9. Cumulative Rights. Each right and remedy of Landlord provided
for in this Lease shall be cumulative and shall be in addition to every other
right or remedy provided for in this Lease, and the exercise or beginning of the
exercise by Landlord of any one or more of the rights or remedies provided for
in this Lease shall not preclude the simultaneous or later exercise by Landlord
of any or all other rights or remedies provided for in this Lease.
Section 16.10. Costs and Expenses. Tenant shall pay to Landlord all costs
and expenses, including reasonable attorneys' fees, incurred by Landlord in
enforcing any of the covenants and provisions of this Lease and incurred in any
action brought on account of the provisions hereof, and all such costs,
expenses, and attorneys' fees may be included in and form a part of any judgment
entered in any proceeding brought by Landlord against Tenant on or under this
Lease.
ARTICLE XVII
NOTICES
Section 17.1. Notices. Whenever it is provided herein that notice, demand,
request or other communication shall or may be given to or served upon either of
the parties by
22
the other, and whenever either of the parties shall desire to give or serve upon
the other any notice, demand, request or other communication with respect hereto
or to the Land, each such notice, demand, request or other communication shall
be in writing and, any law or statute to the contrary notwithstanding, shall be
effective for any purpose if given or served as follows:
(a) If by Landlord, by mailing the same to Tenant by registered or
certified mail postage prepaid, return receipt requested, addressed to
Tenant at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, Attn:
President, or at such other address as Tenant may from time to time
designate by notice given to Landlord by registered or certified mail.
(b) If by Tenant, by mailing the same to Landlord by registered or
certified mail, postage prepaid, return receipt requested, addressed to
Landlord at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn: President of the
Buffalo Enterprise Development Corporation, or at such other address as
Landlord may from time to time designate by notice given to Tenant by
registered or certified mail.
Every notice, demand, request or other communication hereunder shall be
deemed to have been given or served two (2) days following the post ▇▇▇▇ date.
ARTICLE XVIII
CONDEMNATION
Section 18.1. Effect of Condemnation. If at any time during the term of the
Lease, all or substantially all of the Demised Premises shall be taken for any
public or quasi-public purpose by any lawful power or authority by the exercise
of the right of condemnation or eminent domain or by agreement between Landlord,
Tenant and those authorized to exercise such right, this Lease and the term
hereby granted shall terminate and expire on the date of such taking, the Rent
shall be apportioned and paid to the date of such taking and any awards with
respect to such taking shall be apportioned between Landlord and Tenant as
provided in Section 18.2. If less than all, or substantially all, of the Demised
Premises shall be taken as aforesaid, this Lease and the term hereof shall
continue with abatement of the Rent in an amount equal to the product of (i) the
Rent that would otherwise be payable if there was no taking, multiplied by (ii)
a fraction, the numerator of which is the number of square feet of the Demised
Premises remaining after the taking and the denominator of which is the number
of square feet contained in the Demised Premises before any taking. The term
"all or substantially all of the Demised Premises" shall be deemed to mean such
portion of the Demised Premises as when so taken would leave remaining a balance
of the Demised Premises which, due either to the area or the location of the
part so taken in relation to the part not so taken, would not, under economic
conditions, zoning laws or building regulation then existing or prevailing,
readily accommodate an altered or new building or buildings of a nature and
floor area sufficient, together with such portion of the Demised Premises not
taken in the condemnation, to reasonably permit the economically viable use of
the Demised Premises by Tenant.
Section 18.2. Condemnation Awards. In the event of taking of all or
substantially all of the Demised Premises, the net award (or settlement in lieu
thereof) shall be payable to the Tenant and Landlord by paying to (a) the
Landlord, an amount equal to the value of Landlord's interest in the Demised
Premises, subject to this Lease (valued immediately prior
23
to the taking), and (b) to the Tenant (or Leasehold Mortgagee if so required
pursuant to any Leasehold Mortgage) an amount equal to the value of Tenant's
interest under this Lease (valued immediately prior to the taking). In the event
the balance of the award is not sufficient to fully pay the aforesaid amounts
due to Landlord and Tenant, or the balance of award exceeds the aggregate of
such sums, then Landlord and Tenant shall share such balance of the amount in
the same proportion as the respective amounts due to each of them pursuant to
the provisions of this Section 18.2 bear to the total of said amounts.
Section 18.3. Partial Taking. In the event less than all or substantially
all of the Demised Premises, is taken, the total award shall be payable to
Tenant for utilization in the restoration and repair of the Demised Premises to
as near their former condition as circumstances will permit. After application
of the award for such restoration, any balance of the award shall be payable in
the same manner as set forth in Section 18.2.
Section 18.4. Date of Taking. For the purpose of this Article XVIII, the
Demised Premises or a part thereof, as the case may be, shall be deemed to have
been taken or condemned on the date on which actual possession of the Demised
Premises and/or a part thereof, as the case may be, is acquired by any lawful
power or authority or the date on which title vests therein, whichever is
earlier.
Section 18.5. Temporary Takings. In case of any governmental action, not
resulting in the taking or condemnation of any portion of the Demised Premises
but creating a right to compensation therefor, such as the changing of the grade
of any street upon which the Land abuts, this Lease shall continue in full force
and effect without reduction or abatement of Rent, and the award shall be paid
to Tenant as its sole property.
ARTICLE XIX
CERTIFICATES BY LANDLORD AND TENANT
Section 19.1. Tenant's Certificate. Tenant agrees at any time and from time
to time (as may be reasonable) upon not less than twenty (20) days' prior notice
by Landlord to execute, acknowledge and deliver to Landlord a statement in
writing certifying that this Lease is unmodified and in full force and effect
(or if there have been modifications, that the same are in full force and effect
as modified and stating the modifications) and the dates to which the Rent has
been paid in advance, if any, and stating whether or not to the best knowledge
of the signer of such certificate Landlord is in default in performance of any
covenant, agreement or condition contained in this Lease and, if so, specifying
each such default of which the signer may have knowledge.
Section 19.2. Landlord's Certificate. Landlord agrees at any time and from
time to time (as may be reasonable), upon not less than twenty (20) days' prior
notice by Tenant or Leasehold Mortgagee to execute, acknowledge and deliver to
Tenant and Leasehold Mortgagee a statement in writing certifying that this Lease
is unmodified and in full force and effect (or if there shall have been
modifications, that the same is in full force and effect as modified and stating
the modifications) and the dates to which the Rent has been paid in advance, if
any, and stating whether or not to the best knowledge of the signer of such
certificate
24
Tenant is in default in the performance of any covenant, agreement or condition
contained in this Lease, and, if so, specifying each such default of which the
signer may have knowledge.
ARTICLE XX
CONSENTS
Section 20.1. Landlord-Tenant. It is understood and agreed that the
granting of any consent by either party to the other to perform any act
requiring consent under the terms of this Lease, or the failure on the part of
any party to object to any such action taken without consent, shall not be
deemed a waiver by the party of its rights to require such consent for any
further similar act.
ARTICLE XXI
SURRENDER AT END OF TERM
Section 21.1. Surrender. On the last day of the term hereof or upon any
earlier termination of this Lease (unless Tenant has acquired title to the
Demised Premises pursuant to Article XXIX), or upon a re-entry by Landlord upon
the Land pursuant to Article XVI hereof, Tenant shall well and truly surrender
and deliver up to Landlord the Demised Premises free and clear of all liens and
encumbrances other than those, if any, existing at the date hereof, or created
by Landlord or subsequent owners of the Demised Premises, and, without any
payment or allowance whatever by Landlord. Tenant hereby waives any notice now
or hereafter required by law with respect to vacating the Demises Premises on
any such termination date. Title to any Improvements on the Land at the
termination of this Lease shall pass to Landlord without the necessity of any
payment therefor. At the end of the Term, Tenant will promptly quit and
surrender the Demised Premises broom-clean, in good order and repair, ordinary
wear and tear excepted. If Tenant is not then in default, Tenant may remove from
the Demised Premises any trade fixtures, equipment and moveable furniture placed
in the Demised Premises by Tenant, whether or not the same are fastened to the
Improvements thereon; provided Tenant will not remove any trade fixtures or
equipment without Landlord's prior written consent if such fixtures or equipment
are used in the operation of the Demised Premises or removal of the same will
result in impairing the structural strength of the Improvements. Whether or not
Tenant is in default, Tenant will remove such Improvements, trade fixtures,
equipment and furniture as Landlord may request at its sole option and
discretion. Tenant will fully repair any damage occasioned by the removal of any
trade fixtures, equipment, furniture, alterations, additions and Improvements.
All trade fixtures, equipment, furniture, inventory, effects, alterations,
additions and Improvements not so removed will be deemed conclusively to have
been abandoned and may be appropriated, sold, stored, destroyed or otherwise
disposed of by Landlord without notice to Tenant or any other person and without
obligation to account for them; and Tenant will reimburse to Landlord on demand
all expenses incurred in connection with such property, including, but not
limited to, the cost of repairing any damage to the Premises caused by the
removal of such property. Tenant's obligation to observe and perform this
covenant will survive the expiration or other termination of this Lease.
25
ARTICLE XXII
NO ORAL AGREEMENTS
Section 22.1. Agreements in Writing. This Lease contains all the promises,
agreements, conditions, inducements and understandings between Landlord and
Tenant relative to the Land and there are no promises, agreements, conditions,
understandings, inducements, warranties or representations, oral or written,
expressed or implied, between them other than as herein set forth.
ARTICLE XXIII
QUIET ENJOYMENT
Section 23.1. Quiet Enjoyment. Landlord covenants that, if and so long as
Tenant shall faithfully perform the agreements, terms, covenants and conditions
hereof, Tenant shall and may peaceably and quietly have, hold and enjoy the Land
for the term hereby granted without molestation or disturbance by or from
Landlord or any party claiming through Landlord.
ARTICLE XXIV
INVALIDITY OF CERTAIN PROVISIONS
Section 24.1. Partial Invalidity. If any term or provision of this Lease or
the application thereof to any person or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Lease, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby, and each
term and provision of this Lease shall be valid and be enforced to the fullest
extent permitted by law.
ARTICLE XXV
RECORDING OF MEMORANDUM
Section 25.1. Memoranda. Landlord and Tenant will, upon the written request
of the other, join in the execution of a memorandum of lease in proper form for
recordation. Any recordation thereof and New York State transfer stamps due
thereon shall be at Tenant's sole cost and expense.
ARTICLE XXVI
SECURITY DEPOSIT
Tenant has deposited with Landlord the sum of Fifteen Thousand and 00/100
($15,000.00) Dollars ("Security Deposit") as an inducement to Landlord to
purchase the Demised Premises from the Municipality. In consideration thereof,
Tenant hereby agrees and stipulates that the Security Deposit is non-refundable.
Notwithstanding anything contained in the immediately preceding sentence to the
contrary, Landlord shall disburse the Security Deposit to Tenant for general
landscaping, fencing and exterior security relating to the Project upon
submission of receipted invoices to Landlord and the approval by Landlord of (i)
said invoices and (ii) the completion and quality of the aforesaid work.
26
ARTICLE XXVII
ENTRY BY LANDLORD
Landlord, and Landlord's agents and employees may enter the Demised
Premises at any reasonable hour upon 24-hour prior notice to Tenant to (a)
inspect the same, (b) exhibit the same to prospective purchasers, lenders or
tenants, or (c) determine whether Tenant is complying with all Tenant's
obligations under this Lease.
ARTICLE XXVIII
INCORPORATION OF CONTRACT
Section 28.1. General Statement. It is understood and agreed by and between
Landlord and Tenant that Landlord's acquisition of the Demised Premises is
pursuant to the Contract and that the Demised Premises is subject to the
Contract.
Section 28.2. Incorporation. The Contract is hereby incorporated into and
made a part of the terms of this Lease.
Section 28.3. Tenant's Contract Obligations. Tenant hereby covenants and
agrees to perform and comply with all terms and conditions of the Contract
including but not limited to all covenants in the Contract relating to the
improvement, use and/or operation of the Demised Premises (collectively
"Contract Obligations") and hereby assumes all Contract Obligations set forth in
the Contract. Notwithstanding anything contained in this Article XXVIII to the
contrary, Tenant does not agree to perform or comply with any of the terms or
conditions of the Contract or obligations of the Contract set forth in Sections
1, 2, 3, 5(A) (excepting Section 5(A) Eleventh and 5(A) Twelfth), 5(D), 5(E)v,
and 5(E)vi thereof. Tenant hereby further covenants and agrees that it will
consent to, join in the execution of and/or subordinate its rights in this Lease
to the easements described in the Contract, a copy of the easement agreement
containing said easements being attached hereto as Exhibit "D".
ARTICLE XXIX
OPTION TO PURCHASE
Section 29.1. Option. In consideration of the sum of One Dollar and No More
($1.00 and No More) paid to Landlord, Landlord hereby grants, bargains, sells
and conveys to Tenant the option (the "Option") to purchase the Demised Premises
and all rights and appurtenances pertaining thereto, including without
limitation all of Landlord's right, title and interest in and to adjacent
streets, alleys, rights of way and easements at the applicable purchase price
("Purchase Price") determined in accordance with the provisions of Section 29.2
hereof. The term of the Option shall commence on the Commencement Date and shall
expire on the earlier to occur of (i) the last day of the Term of this Lease and
(ii) the termination of this Lease pursuant to the terms hereof ("Option Term").
Tenant may exercise the Option at any time during the Option Term upon notice to
Landlord given at any time during the Option Term. The date upon which the
Option is so exercised is hereinafter referred to as the "Exercise Date". If
Tenant shall so exercise the Option, the terms, covenants and conditions
hereinbefore and hereinafter set forth and as provided in the form contract
attached hereto as Exhibit "C" and made a part hereof shall become the contract
between the parties hereto ("Option Contract").
27
Section 29.2. Option Purchase Price. The term "Purchase Price," as used
herein shall mean as follows:
(1) In the event the Exercise Date is on or after the Commencement
Date but prior to the 5th anniversary of the Commencement Date, the
Purchase Price shall be $450,000.00.
(2) In the event the Exercise Date is on or after the 5th anniversary
of the Commencement Date but prior to the 10th anniversary of the
Commencement Date, the Purchase Price shall be $500,000.00.
(3) In the event the Exercise Date is on or after the 10th anniversary
of the Commencement Date, the Purchase Price shall be $600,000.00.
(4) The parties hereby agree that in the event the Option is
exercised, the Tenant shall be entitled to and shall receive as a credit
against the applicable Purchase Price, the aggregate annual base rent
payments received by Landlord pursuant to Section 2.3 hereof as of the date
of closing.
Section 29.3. Option Termination. It is understood and agreed that the
Option contained in this Article XXIX is appendant to and a part of the Lease,
and shall automatically terminate if (i) it is not exercised within the Option
Term (ii) the Lease has been terminated pursuant to its terms or (iii) the Lease
Term has expired. It is understood and agreed by the parties hereto that the
Option shall not survive the Lease.
Section 29.4. Lease. In the event Tenant exercises the Option, all
provisions of this Lease shall remain in full force and effect until the closing
described in the Option Contract, provided, however, this provision shall not
operate to extend the Term. In the event Tenant has exercised the Option and is
not in default under the Option Contract, Landlord shall not exercise its right
and remedies under Section 16.2 or 16.3.
ARTICLE XXX
MISCELLANEOUS
Section 30.1. Captions. The captions of this Lease are for convenience of
reference only and in no way define, limit or describe the scope or intent of
this Lease or in any way affect this Lease.
Section 30.2. Table of Contents. The table of contents preceding this Lease
(if any) is for the purpose of convenience of reference only and is not to be
deemed or construed in any way as part of this Lease or as supplemental thereto
or amendatory thereof.
Section 30.3. Use of Terms. The use herein of the neuter pronoun in any
reference to Landlord or Tenant shall be deemed to include any individual
Landlord or Tenant, and the use herein of the words "successors and assigns" or
"successors or assigns" of Landlord or Tenant shall be deemed to include the
heirs, legal representatives and assigns of any individual Landlord or Tenant.
28
Section 30.4. Amendment. This Lease cannot be changed or terminated orally,
but only by an instrument in writing executed by the party against whom
enforcement of any waiver, change, modification or discharge is sought. This
Lease shall be governed by the laws of the State of New York.
Section 30.5. Survival. The agreements, terms, covenants and conditions
herein shall bind and inure to the benefit of Landlord and Tenant and their
respective heirs, personal representatives, successors and (except as otherwise
provided herein) assigns.
Section 30.6. Consents. Unless specifically set forth in this Lease to the
contrary, the consent or approval of either party hereto required pursuant to
the provision of this Lease shall not be unreasonably withheld or delayed.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease of the day
and year first above written..
LANDLORD: THE BUFFALO ENTERPRISE
DEVELOPMENT CORPORATION
By:
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------
Title: President
-------------------------------
TENANT: AGRO POWER, INC.
By:
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
Title: President
-------------------------------
29
STATE OF NEW YORK )
COUNTY OF ERIE ) SS:
On the 21st day of August, 1997, before me personally came ▇▇▇▇▇▇ ▇.
▇▇▇▇, to me known, who being by me duly sworn, did depose and say that he
resides at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇; that he is the President of The
Buffalo Enterprise Development Corporation, the corporation described herein and
who by said corporation executed the foregoing instrument; that he signed his
name thereto by order of the Board of Directors of said corporation.
---------------------------------
STATE OF NEW YORK )
COUNTY OF ERIE ) SS:
On the 21st day of August, 1997, before me personally came ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, to me known, who being by me duty sworn, did depose and say that he
resides at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ that he is the President
of Agro Power Development, Inc., the corporation described herein and who by
said corporation executed the foregoing instrument; that he signed his name
thereto by order of the Board of Directors of said corporation.
------------------------------------
Notary Public
EXHIBIT A
ALL TRACT OR PARCEL OF LAND situate in the City of Buffalo, County of Erie,
State of New York, being part of Lots 55, 56, 59 and 197 in Township 10, Range 8
of the Buffalo Creek Indian Reservation-further distinguished as parts of
Subdivision Lots, 5, 6; 7, 8. 9, 10 and 11 in Block 2 an shown an a map filed in
the Erie County Clerk's Office under Cover Number 615 plus additional lands
further bounded and described as following:
BEGINNING at the point in the northeasterly line of South Park Avenue which
is 120 feet northwesterly of the interaction of the northwesterly line of ▇▇▇▇▇▇
Street as shown on Map Cover 615 and the northeasterly line of South Park Avenue
formerly known an ▇▇▇▇▇▇ Road being (66 feet wide);
thence northwesterly along the northeasterly line of South Park Avenue a
distance of 810.21 feet to an angle point in the northeasterly line of South
Park Avenue,
thence continuing northwesterly along the northeasterly line of South Park
Avenue a distance of 739.55 feet to a point, said point being the southwesterly
corner of lands now or formerly owned by Niagara Mohawk Power Corporation, said
point being 604.55 feet east of the southeasterly line of the new channel line
of the Buffalo River as fixed by the Common Council of the City of Buffalo in
1914;
thence northeasterly at right angles and along the southerly line of lands of
Niagara Mohawk Power Corporation, a distance of-135.0 feet to a point, said
point being the southeasterly corner of lands of Niagara Mohawk Power
Corporation;
thence northerly and parallel with the northeasterly line of South Park Avenue
and along the easterly line of lands of Niagara Mohawk Power Corporation a
distance 60.00 feet to a point, said point being the northwesterly corner of
lands of Niagara Mohawk Power Corporation:
thence westerly along a line drawn at right angles to South Park Avenue and
along the northerly line of lands of Niagara Mohawk Power Corporation a distance
of 135.00 feet to a point in the northeasterly line of South Park Avenue;
thence northwesterly along the northeasterly line of South Park Avenue a
distance of 544.55 feet to a point, said point being in the southerly line of
the new channel of the Buffalo River as previously mentioned;
thence in an easterly direction along said channel line at an interior angle of
70(Degree) 32' 20" a distance of 393.90 feet to an angle point in said channel
line.
EXHIBIT A (cont'd)
thence in a southeasterly direction along said channel line at an interior angle
of 145(Degree) 11' 40" a distance of 263.78 feet to an angle point in said
channel line;
thence continuing in a southeasterly direction along said channel line at an
interior angle of 149(Degree) 33' 20" a distance of 2031.71 feet to a point
thence southwesterly at an interior angle of 66(Degree) 56' 54" a distance of
789.38 feet to the point of beginning.
EXHIBIT B
SCHEDULE OF PERFORMANCE
MILESTONE DAY
--------- ---
Notice to proceed........................................................... 0
Mobilization................................................................ 21
Site Work
Complete Grade & Subbase............................................. 60
Headhouse
Complete Design of Headhouse......................................... 45
Complete Foundation.................................................. 80
Complete Steel Erection.............................................. 160
Substantial Completion............................................... 220
Greenhouse
Complete Design of Greenhouse........................................ 45
Complete Foundation.................................................. 105
Complete Steel Erection.............................................. 155
Complete Roof Glazing................................................ 170
Start-Up/Testing............................................................ 210
Substantial Completion...................................................... 340
Final Completion............................................................ 365
Notice to proceed was issued on June 1, 1997.
EXHIBIT C
OPTION CONTRACT
THIS OPTION CONTRACT (this "Agreement") dated the ______ day of
____________, 19___ by and between BUFFALO ENTERPRISE DEVELOPMENT CORPORATION, a
not-for-profit local development corporation organized under the laws of the
State of New York, having its principal office and place of business at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Seller") and AGRO POWER DEVELOPMENT, INC., a
New Jersey corporation, having an office at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ("Purchaser").
1. Sale. Seller agrees to sell and convey to Purchaser, and Purchaser
agrees to purchase from Seller, on the terms and conditions herein provided, the
following property, rights and interests (collectively, the "Property"):
(a) All of that certain tract of land located in the City of Buffalo,
County of Erie, and State of New York and legally described on Schedule A
attached hereto and made a part hereof ("Land").
(b) All buildings and other improvements, if any, located on the Land
("Improvements").
(c) All rights and appurtenances pertaining to the Land and the
Improvements, including without limitation, all of Seller's right, title
and interest in and to adjacent streets, alleys, rights of way and
easements.
2. Purchase Price. Purchaser agrees to pay to Seller the Purchase Price for
the Property, calculated pursuant to Section 29.2 of that certain ground lease
between Seller and Purchaser dated as of September 4, 1997 ("Ground Lease"), as
follows:
(a) Upon delivery of the "Deed" (as hereinafter provided and defined),
by delivery to Seller of the sum equal to the Purchase Price less the
credits set forth in Section 9 hereof.
3. Title Documents.
Purchaser may, at its option, and sole cost and expense, obtain the
following:
(i) a survey of the Land ("Survey").
(ii) a fully guaranteed tax and title search covering the Property
("Abstract") and a local tax certificate, where not covered by the
Abstract.
(iii) A commitment in favor of Purchaser for the most recent form of
ALTA owner's title insurance policy ("Commitment") issued by a title
insurance company
acceptable to Purchaser ("Title Company") setting forth the state of title
to the Property including the state of facts shown on the Survey, if any.
4. Obligations of Seller Prior to Closing. During the period commencing on
the date hereof and ending on the Closing Date (as hereinafter defined), or
within such other period hereinafter contemplated in this Section, Seller agrees
as follows:
(a) Not to create, grant, accept or enter into any option to purchase,
right of first refusal, sale agreement, lease, use and occupancy
arrangement with respect to all or any portion of the Property without
Purchaser's prior written consent.
(b) Not to create or suffer a lien of any kind whatsoever on all or
any portion of the Property, it being understood and agreed by the parties
hereto that any lien which is a result of Purchaser's failure to perform
its obligations under the Ground Lease shall not be a breach of Seller's
agreement hereunder.
5. Closing. The date ("Closing Date") upon which the sale and purchase of
the Property ("Closing") shall take place on the thirtieth (30th) day following
the date on which the option to purchase has been exercised under the Ground
Lease but in no event later than the last day of the Term under the Ground
Lease, TIME BEING OF THE ESSENCE with respect to said date. The Closing shall
take place at 10:00 a.m. on the Closing Date at the offices of Saperston & Day,
P.C., 1100 M&T Center, Three Fountain Plaza, Buffalo, New York.
6. Conveyance and Exceptions.
(a) At the Closing, Seller shall convey to Purchaser its title to the
Property by a recordable quit claim deed with lien covenant ("Deed"),
subject to the following ("Permitted Exceptions"):
(i) any state of facts an accurate survey would show;
(ii) all easements, right of ways, and other encumbrances of any
kind, recorded or unrecorded, which may affect the Property;
(iii) all applicable federal, state and local regulations,
statutes, and laws;
(iv) all liens other than those created or suffered by Seller, it
being understood and agreed by the parties hereto that any lien which
is a result of Purchaser's failure to perform its obligations under
the Ground Lease shall not be a breach of Seller's agreement
hereunder.
(b) If the Commitment shall disclose encumbrances or exceptions to
title other than the Permitted Exceptions ("Unpermitted Exceptions"), or if
the Survey shall disclose any encroachment or other matter rendering title
to the Property unmarketable ("Survey Defect"), Seller may, at Seller's
sole option, cause the Unpermitted Exceptions to be removed from the
Commitment and Survey Defects to be removed prior to Closing.
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(c) In the event Seller does not so elect to remove the Unpermitted
Exceptions or Survey Defect, Purchaser, at its sole option and upon notice
to Seller, shall elect: (i) to terminate this Agreement; or (ii) to accept
the conveyance of the Property subject to the unremoved matters. If this
Agreement is terminated pursuant to clause (i) above, neither party shall
have any further liability or obligation hereunder.
7. Seller's Obligations at Closing. At the Closing, Seller shall furnish to
Purchaser the following, each of which shall be in a form reasonably
satisfactory to Purchaser's counsel:
(a) The Deed.
(b) A State of New York Board of Equalization and Assessment Real
Property Transfer Report for the Property and the transaction contemplated
herein.
(c) (i) Form TP-584 published by the New York Department of Taxation
and Finance ("Department") consisting of the New York State Combined Real
Property Transfer Tax Affidavit, Real Estate Tax Return and Credit Line
Mortgage Certificate; and (ii) if applicable, Form TP-584.1 published by
the Department consisting of the New York State Transfer Tax Return
Supplemental Schedules.
(d) A FIRPTA Affidavit executed by Seller.
(e) Possession of the Property.
(f) A certified copy of resolutions of Seller's Board of Directors
authorizing and directing the sale of the Property pursuant to this
Agreement.
(g) Such other documents as Seller is required to deliver by law or
pursuant to the terms of this Agreement.
8. Purchaser's Obligations at Closing. Provided that Seller shall perform
all of Seller's obligations under this Agreement, Purchaser shall deliver to
Seller at the Closing the following:
(a) The Purchase Price, minus the credits set forth in Section 9(b),
in the form of immediately available funds.
(b) Such other documents and payments as Purchaser is required to
deliver by law or pursuant to the terms of this Agreement.
9. Adjustments; Costs.
(a) Seller and Purchaser acknowledge and agree that Purchaser is
obligated to pay all "Impositions" as defined in the Ground Lease.
Accordingly, there shall be no proration of any Impositions.
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(b) Purchaser shall receive a credit against the Purchase Price in the
amount calculated pursuant to and in accordance with Section 29.2(4) of the
Ground Lease.
(c) Purchaser shall pay all recording costs, all New York State
Mortgage Taxes, if any, and the premium for the Title Policy, all
documentary, intangible, transfer and other taxes with respect to the Deed,
the Survey, all search continuation charges.
10. Representations and Warranties. To induce Purchaser to enter into this
Agreement, Seller represents and warrants to Purchaser as follows:
(a) Seller is not a "foreign person" as such term is defined in
Section 7701 of the Internal Revenue Code, as amended.
(b) There is no lease, option to purchase, right of first refusal to
purchase or agreement for the sale and purchase of all or any portion of
the Property to any person or entity, except for this Agreement and the
Ground Lease.
(c) Seller has full power and authority to enter into and consummate
the transaction contemplated by this Agreement without the consent or
approval of any third party, and when signed by Seller, this Agreement
constitutes a legal, valid and binding obligation of Seller, enforceable in
accordance with its terms.
Seller acknowledges that Purchaser will rely on Seller's representations
and warranties in connection with entering into this Agreement. All of the
foregoing representations and warranties shall merge into the Deed at the
Closing.
11. Conditions Precedent to Closing.
(a) Compliance by Seller and Purchaser with all terms and conditions
under this contract.
12. Broker. Each party hereto represents and warrants to the other party
that it has not utilized the services of any real estate broker, salesperson or
finder in connection with this Agreement or the transaction contemplated. Each
party hereto agrees to indemnify, defend and hold the other party harmless from
and against all other claims for brokerage commissions and finder's fees arising
from or attributable to the acts or omissions of the indemnifying party or any
party or entity acting or purportedly acting on behalf of the indemnifying
party.
13. Remedies Upon Default. If either party shall fail to keep or observe
any covenant, agreement or obligation to be kept or observed by such party under
this Agreement, the other party shall have the right, in addition to the
exercise of any other remedy available to it at law or in equity, (i) to
terminate this Agreement upon notice to the other party and recover damages; or
(ii) to enforce specific performance of this Agreement.
14. Notices. Any notice required or permitted to be given hereunder shall
be deemed given when personally delivered or deposited in the United States
mail, postage prepaid, certified or express mail, return receipt requested,
addressed to Seller or Purchaser, as the case may be, as follows:
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If to Seller: The Buffalo Enterprise Development Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: President
With a copy to: Saperston & Day, P.C.
1100 M&T Center
Three Fountain Plaza
Buffalo, New York 14203
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
If to Purchaser. AGRO Power Development, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
With a copy to: ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Either party to this Agreement may change its address for notice purposes
by giving notice thereof to the other party hereto, except that such change of
address notice shall not be deemed to have been given until actually received by
the addressee thereof.
15. Ground Lease.
This Agreement and all rights and obligations hereunder shall automatically
terminate in the event the Ground Lease is terminated.
16. Purchaser's Representations.
(a) Purchaser shall be deemed to warrant and represent to Seller that, as
of the date of this Agreement, (i) Purchaser is familiar with the Property; (ii)
Purchaser is in possession of the Property pursuant to the Ground Lease; (iii)
Purchaser accepts the Property in "as is" condition, subject only to the express
representations and warranties made by Seller in this Agreement and the Ground
Lease; and (iv) Purchaser is entering into this Agreement voluntarily upon its
own judgment and is not relying upon any representation or warranty of Seller
other than as appears in this Agreement.
17. Remedies.
Each party shall have all rights and remedies available under New York law
both at law and equity in the event of a default by the other party hereunder.
18. Miscellaneous.
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(a) This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
(b) This Agreement constitutes the entire agreement and understanding
between the parties hereto, and there are no agreements, representations or
warranties except those herein expressly set forth, and it is agreed that any
change in, addition to, amendment or modification of the terms hereof shall be
of no effect unless reduced to writing and executed by both parties hereto.
(c) The captions used in connection with the Sections of this Agreement are
for convenience of reference only and shall not be deemed to construe, limit or
expand the meaning or language of this Agreement.
(d) If the last day for performance of any obligation hereunder occurs on a
Saturday, Sunday or legal holiday, the time for performance shall be extended to
the next regular business day.
(e) If any provision of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, the remainder of the
provisions of this Agreement shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.
(f) Nothing in this Agreement, express or implied, is intended to confer
upon any person, other than the parties hereto and their respective successors
and assigns, any rights or remedies whatsoever.
(g) This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first above written.
SELLER: BUFFALO ENTERPRISE DEVELOPMENT
CORPORATION
By:______________________________________
Its:_____________________________________
PURCHASER: AGRO POWER DEVELOPMENT, INC.
By:______________________________________
Its:_____________________________________
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