AGREEMENT OF LEASE BETWEEN MSM REALTY CO., LLC DAVRICK, LLC and SHOLOM BLAU CO., LLC (“LANDLORD”) AND ICON LABORATORIES, INC. (“TENANT”) PREMISES: 123 SMITH STREET, FARMINGDALE, NEW YORK
AGREEMENT
OF LEASE
BETWEEN
MSM
REALTY CO., LLC
DAVRICK,
LLC and
▇▇▇▇▇▇
▇▇▇▇ CO., LLC (“LANDLORD”)
AND
ICON
LABORATORIES, INC. (“TENANT”)
PREMISES:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
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EXHIBITS
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Exhibit
“A” - Demised Premises
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Exhibit
“B” - Survey
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Exhibit
“C” - Building Plans
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Exhibit
“D” - Design and Construction Schedule
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Exhibit
“E” - Form of Non-Disturbance Agreement
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Exhibit
“F” - Letter of Credit
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Exhibit
“G”- Guaranty
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-iii-
AGREEMENT
OF LEASE
AGREEMENT OF LEASE (this
“Lease”) dated as of November 29, 2002 between MSM REALTY CO., LLC,
Tenant-In-Common, a New York limited liability company, owning a 46.77%
interest; DAVRICK, LLC,
Tenant-In-Common, a New York limited liability company, owning a 34.77%
interest; and ▇▇▇▇▇▇ ▇▇▇▇ CO.,
LLC, Tenant-In-Common, a New York limited liability company, owning an
18.46% interest; all having an address c/o Marcus Property Management Corp.,
with offices at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
collectively, as landlord (“Landlord”) and ICON LABORATORIES, INC., a
Delaware corporation, with offices at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, as tenant (“Tenant”). (Landlord and Tenant are sometimes collectively
referred to as the “parties” or individually as a “party”).
1. Demised
Premises: Landlord hereby demises and leases to Tenant, and Tenant
leases from Landlord, the land which is described in Exhibit “A”, which
land is designated as District 0100, Section 002.00, Block 01.00, Lot 011.001
and District 0400, Section 267.00, Block 02.00, Lot 025.000 on the Suffolk
County Tax Map (the “Land”), as shown on the survey attached hereto as Exhibit ”B”,
together with the Improvements constructed or to be thereon, including a
building which will consist of approximately 115,000 square feet (the
“Building”), with all appurtenances thereto (collectively referred to as the
“Demised Premises”). The term “Improvements” means any and all structures or
improvements now or hereafter created or situated on the Land, including the
Building, if applicable, foundations and footings thereof, any and all fixtures,
equipment and machinery of every kind and nature whatsoever now or hereafter
affixed or attached to the Improvements, but excluding therefrom all of Tenant’s
trade fixtures, trade equipment and articles of personal property which may be
removed without material injury to the Improvements or the Land. The Demised
Premises is also known by the street address of ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇.
2. Lease Term:
This Lease shall become effective upon execution, which shall be the date of the
last signature hereto (the “Effective Date”). However, Tenant shall have and
hold the Demised Premises for a term (the “Term”) commencing on the Commencement
Date (as defined below), and ending on the last day of the month in which the
15th anniversary of the Commencement Date occurs (“Expiration Date”). For
purposes hereof, the “Commencement Date” means such date which is fifteen (15)
days following the written notice from Landlord to Tenant that the Building Work
(as defined in Section “7” below) has been Substantially Completed (as that term
is defined in Section “7.D” below). In no event shall possession of the Demised
Premises be given to Tenant before the Commencement Date. In no event shall the
Commencement Date be deemed to occur prior to the date in Landlord’s notice to
be sent pursuant to this Section “2”, subject to Section “7.F”, below. Upon
request of either party, the parties shall execute a letter expressing the date
of the Commencement Date. The parties agree that unless otherwise provided
herein, operative obligations of Tenant with regard to the possession of Demised
Premises, such as obligation for repairs and maintenance, shall run from the
Commencement Date, unless earlier provided under the terms of this
Lease.
3. Contingencies: This Lease is conditioned upon Landlord
acquiring fee title to the Land and the Improvements. Landlord represents to
Tenant that its affiliate, Schuss Realty Company, has entered into a Purchase
and Sale Agreement with QRS 11-17(NY), Inc., current owner of the Land, for the
purchase of same and that said agreement is in full force and effect and has not
been amended. Tenant acknowledges receipt of a copy of said Purchase and Sale
Agreement. If for any reason whatsoever, Landlord has not acquired the Land by
March 1, 2003, Tenant, upon ten (10) business days written notice to Landlord,
may elect to terminate this Lease in which case such termination will be
effective at the expiration of said ten (10) business days if Landlord has not
then acquired title to the Land, whereupon any monies paid by Tenant to Landlord
pursuant to this Lease shall be returned to Tenant and neither party shall have
any other liability to the other. Notwithstanding anything to the contrary
contained herein, if the Purchase and Sale Agreement is irrevocably canceled on
or before March 1, 2003, then Landlord will have the right, upon ten (10)
business days written notice to Tenant to terminate this Lease, in which case
any monies paid by Tenant to Landlord pursuant to this Lease shall be returned
to Tenant and neither party shall have any other liability to the
other.
4. Rent: Rent is payable to
Landlord at Landlord’s address specified in the preamble of this Lease, or at
such other address as Landlord may, from time to time designate in writing, in
consecutive monthly installments of one-twelfth (1/12) of the rent set forth
below (“Fixed Annual Rent”). Each such monthly installment of Fixed Annual Rent
shall be due and payable in advance on the first day of each calendar month
during the Term commencing on the Rent Commencement Date (as hereinafter
defined), except that upon the Effective Date, Tenant shall pay to Landlord the
first full month’s rent which Landlord shall apply to the first full month of
the Term. If the Rent Commencement Date does not fall on the first day of a
calendar month, then Tenant shall pay to Landlord upon the Rent Commencement
Date the portion of Fixed Annual Rent then due prorated for the balance of the
month in which the Rent Commencement Date falls. Fixed Annual Rent shall be
payable without any set off or deduction whatsoever. The Fixed Annual Rent is as
follows:
|
Lease
Years
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Fixed Annual
Rent
|
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1st
through 5th lease year
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$2,025,750.00
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6th
lease year
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$2,220,000.00
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7th
through and including 15th lease years
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2.5%
annual increases each lease year
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Notwithstanding
the foregoing, no rent payment shall be due with respect to the period of thirty
(30) days from the Commencement Date (the thirty first (31st) day following the
Commencement Date being referred to as the “Rent Commencement
Date”).
A. Landlord
represents and covenants as follows:
1. Possession:
On the Commencement Date, the Demised Premises shall be free and clear of all
tenancies, whether oral or written, and subject to the terms of this Lease,
Tenant shall have sole and actual possession from the Commencement Date through
the end of the Term, subject to Landlord performing any obligation required of
it under the terms of this Lease. Ownership or lease of the Demised Premises by
the ▇▇▇ (as hereinafter defined) shall not be objected to by
Tenant.
2. Quiet
Enjoyment: Provided that Tenant shall not be in default in any of its
obligations beyond any period for the cure thereof, Tenant shall, at all times
during the Term, subject to the rights of the holder of any mortgage on the
Demised Premises, have peaceable and quiet enjoyment and possession of the
Demised Premises without any manner of molestation or hindrance from the
Landlord or any other person, firm, corporation, or other entity.
3. This
Lease as written contains all of the terms of the agreement entered into between
the parties, and the Tenant acknowledges that the Landlord has made no
representations, is unwilling to make any representations and has held out no
inducements to the Tenant other than those herein expressed.
4.
Landlord consists of a group of tenants-in-common owning respective
interests in the Demised Premises, each tenant-in-common being a limited
liability company duly organized and validly existing under the laws of the
State of New York
-2-
5. Landlord
has full power and authority to execute and deliver this Lease and to perform
all of its obligations arising under this Lease and such other documents
required hereunder to be executed by Landlord (collectively, “Landlord’s
Documents”).
6. This
Lease and Landlord’s Documents do not and will not contravene any provision of
the organizational documents of Landlord, any judgement, order, decree, writ or
injunction, of any provision of any existing law or regulation to which Landlord
is a party or bound. The execution and delivery of this Lease and the
consummation of the transactions contemplated hereby do not and will not require
any consent by and third party.
B. Tenant represents and
covenants as follows:
1. Tenant
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware, and is in good standing in the State of New York
and is duly authorized to conduct business in the State of New York. Prior to
Lease execution, Tenant will submit to Landlord a duly issued certificate of
good standing from its state of incorporation and from New York
State.
2. Tenant
has full power and authority to execute and deliver this Lease and to perform
all of its obligations arising under this Lease and such other documents
required hereunder to be executed by Tenant (collectively, “Tenant’s
Documents”).
3. This Lease and Tenant’s
Documents do not and will not contravene any provision of the organizational
documents of Tenant, any judgement, order, decree, writ or injunction, of any
provision of any existing law or regulation to which Tenant is a party or bound.
The execution and delivery of this Lease and the consummation of the
transactions contemplated hereby do not and will not require any consent by and
third party.
4. If
after the date of execution of this Lease, Tenant is required to disclose this
Lease in any filing with any governmental agency, it shall notify Landlord of
same and diligently request to have the rental information redacted or given
confidential treatment.
A. All
real estate taxes, assessments, impositions, PILOT (Payment In Lieu of Taxes)
payments and unmetered water and sewer charges, and any other governmental
levies, impositions or charges of a similar or dissimilar nature, whether
general, special, ordinary, extraordinary, foreseen or unforeseen, which may be
levied or imposed upon all or any part of the Land or the Improvements, are
hereinafter referred to as “Taxes.” To the extent the Taxes are abated due to
Industrial Development Agency (“▇▇▇”) benefits, such savings shall be passed on
to Tenant. Tenant agrees to cooperate as necessary with Landlord in procuring
such ▇▇▇ benefits, including entering into any ▇▇▇ documents necessary to effect
such benefits, such as lease/sublease agreements among the ▇▇▇, provided same do
not impose any additional material or adverse obligations on Tenant. Tenant
shall bear all of its costs associated with such ▇▇▇ documentation, including,
but not limited to, its attorneys fees associated with reviewing such ▇▇▇
documentation. Landlord shall pay, before interest and penalties accrue, all
Taxes assessed against the Demised Premises and all penalties and interest, for
the year in which the Commencement Date occurs prorated based on the
Commencement Date. Landlord shall also pay before interest and penalties accrue,
all special assessments, impositions and all other claims or charges which are a
lien on the Demised Premises on the Commencement Date, whether or not such
assessments are past due, then due or are thereafter to become
due.
-3-
B. From
and after the Commencement Date, Tenant agrees to pay, before interest and
penalties accrue, all Taxes applicable to the Demised Premises. Tenant shall
deposit with Landlord, the Mortgagee (as hereinafter defined) or Master Lessor
(as hereinafter defined), as the case may be, a tax escrow amount equal to
one-twelfth (1/12th) of the then applicable amount as evidenced on the most
recent statement of Taxes issued by the local taxing authority, or in any other
manner requested by Landlord’s Mortgagee, so that Landlord or said Mortgagee, as
the case may be, shall have sufficient amounts collected to pay any tax coming
due at least thirty (30) days prior to the due date of such Taxes and if said
amounts are insufficient to pay the Taxes coming due, Tenant shall be billed by
Landlord for the difference (with interest at the Interest Rate, as hereinafter
defined, if Landlord incurs interest charges due to Tenant’s failure to pay on
time). Tenant acknowledges that the Mortgagee or Master Lessor may require
additional payments attributable to Taxes in order to establish a tax escrow
account, and Tenant agrees to pay such amounts as necessary within ten (10) days
of Landlord’s notice therefor. Landlord agrees to cap this escrow amount at
three (3) months of tax payments. All such payments for the first and last year
of the Term shall be prorated between Landlord and Tenant so that Tenant shall
only be responsible for that portion of the Taxes which is attributable to the
Term. In the event the Taxes includes any special assessment or assessment which
may be paid in installments, unless otherwise directed by written notice from
Tenant, Landlord shall advise the appropriate governmental agency of its
intention to elect payments in installments thereof, and Tenant shall pay only
such installments as shall be due and payable during the Term, regardless of
when such installment was assessed.
C. In
no event shall Tenant be liable for payment of any income, estate, transfer,
franchise, excess profit, sales, excise, or inheritance taxes imposed upon
Landlord or the estate of Landlord. Tenant shall not pay any income, estate,
transfer, franchise, excise, sales, inheritance or excess profits tax levied
upon, required to be collected by, or assessed against Landlord, subject to the
following sentence. If due to a change in the method of taxation any franchise,
income, profit, or other tax, however designated, shall be levied against
Landlord’s interest in the Demised Premises in whole or in part for or in lieu
of any tax which would otherwise constitute Taxes, such change in method of
taxation shall be included in the term “Taxes” for purposes hereof.
D. The
certificate, advice, ▇▇▇▇ or receipt of statement issued or given by the
appropriate officials authorized or designated by law to issue or give the same
or to receive payment of any tax of any payment in lieu thereof shall be prima
facie evidence for all purposes of the existence, payment, non-payment or amount
of such tax or payment. Landlord’s failure to provide such documentation to
Tenant shall not eliminate or reduce Tenant’s obligation to pay Taxes
hereunder.
E. Landlord
shall have the right to, and at the request of Tenant shall, contest the amount
or legality of any Taxes which it is obligated to pay hereunder and make
application for the reduction thereof, or any assessment upon which the same may
be based, and Tenant agrees, within ten (10) days of receipt of the request of
Landlord, to execute or join in the execution of any instruments or documents
necessary in connection with such contest or application. In the event Landlord
initiates any tax reduction proceedings (whether at the request of Tenant or
not) all monies received by Landlord attributable to Taxes paid by Tenant shall
be paid to Tenant after deduction for reasonable third party costs and expenses,
including, but not limited to, attorney’s fees and disbursements and appraisal
fees.
F. The
obligation of Tenant in respect of Taxes for the last year of the Term or part
thereof and Landlord’s obligation to refund any overpayment shall survive the
expiration of the Term.
-4-
A. Landlord
shall construct the Building substantially in accordance with the plans and
specifications for the building (“Building Work”) listed on Exhibit “C” attached
hereto and hereby made a part hereof and complete the same within the time
frames set forth in Exhibit “D” in a good
and workmanlike manner using materials of first quality in accordance with all
applicable laws, ordinances, rules and regulations. Landlord shall cause to be
created and delivered to Tenant, in accordance with the time frames set forth in
Exhibit “D”,
(i) Building Schematic Designs, (ii) Building Mechanical, Electrical and
Plumbing Drawings and Specifications, (iii) Building Design Development Plans,
(iv) Building 75% Construction Documents and (v) Building 100% Construction
Documents for the Building which, as completed, are referred to herein
collectively as the “Building Plans.” All of the Designs, Drawings,
Specifications, Plans and Documents referred to in the preceding sentence other
than the Building 100% Construction Documents are collectively referred to
herein as the “Preliminary Construction Documents.”
B. The
Building Work shall include all work shown on the Building Plans, including (i)
construction of approximately 25,000 square feet office space, (ii)
modifications to the existing site, (iii) modifications to the exterior facade
of the Building, (iv) modifications to the roof membrane, to the extent required
in Landlord’s judgement, and (v) construction of (w) a lab area of approximately
32,000 square feet, (x) a kit assembly and receiving area of approximately
21,600 square feet, (y) a warehouse area of approximately 16,000 square feet,
and (z) a building support area of approximately 11,000 square feet, all as
shown on the Building Plans. Any cost overruns in completing the Building Work
shall be Landlord’s responsibility, unless same is caused by the acts or
omissions of Tenant or by change orders requested by Tenant.
C. Landlord
shall use reasonable speed and diligence to have the Building Work substantially
completed in accordance with the time frames set forth in Exhibit “D”. Landlord
shall not substantially nor materially deviate from the Building Work shown on
Exhibit “C”,
without obtaining the prior written consent of Tenant, which consent shall not
be unreasonably withheld, conditioned or delayed, provided such changes do not
materially adversely affect Tenant’s ability to operate its business in the
Demised Premises or materially delay the completion thereof. The failure to have
the Building Work substantially completed in accordance with the time frames set
forth on Exhibit
“D” shall in no way affect the validity of this Lease or the obligations
of Tenant hereunder nor shall the same be construed in any way to extend the
Term of this Lease. If the Building Work has not been deemed substantially
completed within the meaning of Section “7” hereof in accordance with the time
frames set forth on Exhibit “D”, Tenant
shall not have any claim against Landlord, and Landlord shall have no liability
to Tenant, by reason thereof, except as otherwise set forth in this Lease.
Tenant expressly waives (a) any right to rescind this Lease under Section 223-a
of the Real Property Law of the State of New York (or any other law of like
import, now or hereafter in force) and (b) the right to recover any damages
resulting from Landlord’s failure to deliver possession of the Demised Premises
on any fixed date for any reason whatsoever, except as otherwise set forth in
this Lease.
-5-
D. The
Building Work shall be deemed “Substantially Completed” on the date when (x)
Landlord’s architect has issued a certificate to the effect that the same has
been completed in a good, structurally sound condition, except for minor or
insubstantial details which by their nature can be substantially completed
within sixty (60) days after the Commencement Date without materially
interfering with Tenant’s use and occupancy of the Demised Premises or Tenant’s
ability to conduct its business operations therein; (y) Landlord has obtained a
temporary (which cannot be revoked and in such case Landlord will remain
obligated to obtain a permanent certificate of occupancy) or permanent
certificate of occupancy for the Demised Premises, and any other permits and
approvals required from the applicable governmental authorities to enable Tenant
to occupy and use the Demised Premises for the conduct of its business in the
Demised Premises (exclusive of any business licences which Tenant may be
required to obtain in order to operate its specific business), which permits and
approvals shall include, limitation, zoning and building code approvals,
environmental requirements (other than those specifically required for Tenant’s
business activities) or on such earlier date on which the Building Work would
have been completed, as aforesaid, but for delays (referred to collectively
herein as “Tenant Delays”) which are: (i) due to special work, changes,
alterations or additions required or made by Tenant or made by Landlord on
behalf of Tenant even if the same have been approved by Landlord, provided that
Landlord delivers notice to Tenant at the time that Tenant requires such special
work, changes, alterations or additions that same will result in Tenant Delays,
(ii) caused by Tenant through the delay of Tenant (and not caused by or due to
Landlord) in submitting any plans and/or specifications, supplying information,
or otherwise other than in accordance with the time periods set forth in this
Lease or (iii) caused by delay and/or default on the part of Tenant or its
agents or contractors including, without limitation, the utility companies and
other entities furnishing communications, data processing or other service or
equipment; and (z) Landlord shall have delivered to Tenant, a subordination,
non-disturbance and attornment agreement in the format set forth in Section “20”
below, executed by each Mortgagee, Master Lessor or deed of trust holder, as the
case may be, encumbering the Land or any portion thereof. So, for example, if
the Tenant Delays result in Landlord’s delay of substantially completing the
Building Work, then the Commencement Date will be deemed for all purposes of
this Lease to be such date that the Commencement Date would have occurred but
for such Tenant Delays. In such event, however, even though the Building Work is
deemed substantially completed pursuant to the foregoing (and the Term shall
have commenced by reason thereof), Tenant shall not (except with Landlord’s
consent) be entitled to take possession of the Demised Premises until the
Building Work has been in fact substantially completed and Landlord shall be
obligated to complete the Building Work in accordance with the applicable terms
and conditions of this Lease. Landlord’s architect’s certificate of substantial
completion, as hereinabove stated, given in good faith, or of any other facts
pertinent to this Section “7” shall be deemed conclusive of the statements
therein contained and binding upon Tenant, unless, within ten (10) days of
Tenant’s receipt of such certificate, Tenant gives Landlord written notice
setting forth with specificity Tenant’s reasonable objections to such
certificate and such objections reflect the facts of the matters about which the
objections have been made. In such event, Landlord shall use good faith efforts
to address such objections in order to obtain a revised architect’s certificate
of substantial completion within thirty (30) days of Landlord’s receipt of
Tenant’s notice of objections. Any of the Building Work not fully completed on
the Commencement Date shall thereafter be so completed with reasonable diligence
by Landlord, but in any event within sixty (60) days after the date of delivery
of the Demised Premises to Tenant. If the Building Work is not completed by
February 1, 2004, provided such incompletion is not due to Tenant’s wrongful
acts or omissions or Tenant delays, Tenant will have the right, upon ten (10)
business days written notice to Landlord, to be effective at the end of such
notice period, to elect to cancel this Lease (“Tenant’s Termination Notice for
Non-Completion”), whereupon any monies paid by Tenant to Landlord pursuant to
this Lease shall be returned to Tenant and neither party shall have any other
liability to the other. If the Building Work is completed in accordance with
this Section “7.D” by the expiration of said ten (10) business day period, then
Tenant’s notice shall be deemed null and void and the Term shall have commenced.
If Tenant fails to give a Tenant’s Termination Notice for Non-Completion as set
forth above by April 1, 2004, then it will be deemed that Tenant has elected to
waive such right of cancellation. If the Building Work is not completed by June
1, 2004, Landlord will have the right, upon ten (10) business days written
notice to Tenant, to elect to cancel this Lease (“Landlord’s Termination Notice
for Non-Completion”), whereupon any monies paid by Tenant to Landlord pursuant
to this Lease shall be returned to Tenant and neither party shall have any other
liability to the other.
-6-
E. With
Landlord’s prior written consent, which shall not be unreasonably withheld
Tenant shall have the right to enter the Demised Premises prior to the
Commencement Date during normal business hours and without payment of rent for
the purposes of inspecting the work, taking measurements, making plans, and
performing Tenant’s work without being deemed thereby to have taken possession
or obligated itself to pay Rent, provided, however, that Tenant
shall not, during the course of such work, materially interfere with the
performance of the Building’s work and shall indemnify and hold Landlord
harmless from and against any and all claims or losses arising from Tenant’s (or
its agents, employees or contractor’s) negligence or wrongful acts in connection
with Tenant’s (or its agents, employees or contractor’s) entry upon the Demised
Premises, except to the extent caused by Landlord, its agents, employees, or
contractors. Such right of entry shall be deemed a license from Landlord to
Tenant, and any entry thereunder shall be at the sole risk of Tenant and made
only subsequent to Tenant’s delivery to Landlord of the duplicate originals of
certificates of insurance required by Section “11” hereof.
F. Except
as otherwise provided in this Lease, Landlord shall use commercially reasonable
speed and effort to complete the milestones set forth on Exhibit “D” on the
dates specified therein.
G. Warranty.
1. The
Landlord warrants to the Tenant that materials and equipment furnished by the
Landlord under this Lease will be of good quality and new, that the Building
Work will be performed in a good workmanlike manner and be free from material
defects not inherent in the quality required or permitted, and the Building Work
will conform to the requirements of this Lease. Work not conforming to these
requirements, excluding substitutions not properly approved and authorized by
Landlord, or work altered or affected by Tenant’s acts or omissions or those of
its employees, agents, licensees and contractors, maybe considered defective.
The Landlord’s warranty excludes remedy for damage or defect caused by abuse or
modifications not executed by Landlord, improper or insufficient maintenance, or
improper operation not caused by Landlord, Landlord’s contractor, or anyone for
whom either is responsible, or normal wear and tear under normal usage. Landlord
shall furnish, upon request of Tenant, reasonably satisfactory evidence as to
the kind and quality of materials and equipment.
2. The
Landlord further agrees that each of its contractors shall provide a warranty of
the work performed thereunder in the same form as the above stated warranty of
Landlord. Included in said warranty shall be the statement that same shall be
enforceable directly by Tenant, if Tenant so elects. The warranty of any of
Landlord’s contractors shall not relieve Landlord of its warranty as set forth
above and Tenant shall look to Landlord’s contract, directly and in the first
instance, to correct any defects in the Building Work. The warranty from the
manufacturer for the HVAC system will be one (1) year and for the compressors
will be five (5) years from the start-up date of the equipment.
3. The
warranties provided in this Section “7.G” shall be in addition to and not in
limitation of any other warranties, guarantees, or remedies allowed by this
Lease or otherwise prescribed by law.
4. Landlord
shall guarantee the Building Work performed for one (1) year from the date of
Substantial Completion and shall procure and deliver to Tenant no later than
thirty (30) days following the date of Substantial Completion, all special or
direct warranties required by this Lease or made available to Landlord by any of
its contractors, suppliers or vendors.
8. Personal Property
Taxes: Tenant shall pay all taxes assessed against its personal
property related to its use and occupancy of the Demised
Premises.
-7-
9. Utilities:
Landlord shall not be obligated to furnish to Tenant or the Demised Premises any
heat, air conditioning, ventilation, power, gas, electricity, water, telephone,
light or any other services or utilities of any kind, but Landlord shall provide
the equipment for furnishing such services in accordance with the Building
Plans. Tenant shall make arrangements with public utilities or private
companies, if appropriate, for the furnishing of electricity, gas, fuel,
telephone, water and any other utilities and services which Tenant deems
necessary or desirable in connection with its use and occupancy of the Demised
Premises. Tenant shall promptly pay to such companies the cost of such utilities
and services and any security deposits required. If Tenant shall default in
paying for any of the above, Landlord may collect such costs from Tenant as
Additional Rent and pay the same on Tenant’s behalf, or Landlord may pursue any
other remedies it may have hereunder or at law or equity. Initial utility
installations are part of the Building Work. After the Commencement Date,
Landlord shall not be obliged to ensure that they remain in working order or are
serviced by the utility supplier, subject to the provisions of Section “7”,
above. The Landlord shall not be liable in any way to Tenant for any failure or
defect in the supply or character of electric energy, water, gas or other
utilities furnished to the Demised Premises by reason of any requirement, act or
omission of the public utility supplier serving the Demised Premises or for any
other reason.
10. Additional
Rent, Late Charges: All costs, charges, expenses, and adjustments of
rent, including, but not limited to, payment of Taxes, which Tenant assumes,
agrees or is obligated to pay to Landlord pursuant to this Lease or any other
agreement between Landlord and Tenant shall be deemed Additional Rent, and in
the event of non-payment thereof, Landlord shall have all the rights and
remedies with respect thereto as are provided for herein or by applicable law in
case of non-payment of rent. Tenant’s obligation to pay Fixed Annual Rent and
Additional Rent shall survive the expiration or termination of the Term.
Installments of Fixed Annual Rent and any Additional Rent payable on a monthly
basis shall be equitably adjusted if the Term commences or terminates on a day
other than the first day of a calendar month.
If
during the Term, Tenant shall fail to pay the Fixed Annual Rent or any
Additional Rents at any time due or payable hereunder upon the date provided in
this Lease for the payment thereof, beyond any applicable grace period set forth
in Section “37”, below, if not cured, Tenant shall pay to Landlord a late
charge, on demand by Landlord, equal to 5% of Fixed Annual Rent and Additional
Rent past due (“Initial Late Charges”). In addition to the payment set forth
above if the notice provided for by the preceding sentence has been given any
Fixed Annual Rent, Additional Rent or other amounts to be paid by Tenant which
are not paid within thirty (30) days after the date such payment is due, shall
bear interest (“Interest Rate”) from and after the expiration of such thirty
(30) day period equal to the lesser of: (a) the Prime Rate as announced from
time to time by the Wall Street Journal plus 4% per annum, or (b) the
maximum legal rate (“Additional Late Charges”). In addition, if any check
tendered by Tenant in payment of any Fixed Annual Rent or Additional Rent is
dishonored or otherwise returned by Tenant’s or Landlord’s Bank for any reason
whatsoever, Tenant shall pay to Landlord upon demand, in addition to the
aforesaid late charges, the sum of $100.00 as Additional Rent for the
administrative costs involved in handling such dishonored check.
Tenant
acknowledges that the timely payment of Rent and Additional Rent is of the
utmost importance to Landlord. Accordingly, it is agreed that the late payment
of Fixed Annual Rent and/or Additional Rent constitutes a material and
substantial breach of this Lease. Furthermore, in the event that Landlord shall
▇▇▇▇ Tenant for late charges pursuant to this Section “10” on two (2) occasions
in any twelve (12) consecutive month period, in the event Tenant shall fail to
make a third payment of Fixed Annual Rent or Additional Rent within any
applicable grace, notice or cure period in said twelve (12) consecutive month
period, Landlord shall have the option, exercisable within thirty (30) days of
the date when said payment of Fixed Annual Rent or Additional Rent was due, of
canceling this Lease on three (3) days’ notice and upon the expiration of said
three (3) days this Lease and the Term shall end and expire as fully and
completely as if the expiration of such three (3) day period were the day herein
definitely fixed for the end and expiration of this Lease and the Term hereof
and Tenant shall then quit and surrender the Demised Premises to Landlord. In
such event, Landlord shall have the rights and remedies set forth elsewhere in
this Lease.
-8-
Nothing
contained in this Section is intended to grant Tenant any extension of time in
respect of the due dates for any payments under this Lease, nor shall the same
be construed to be a limitation of or a substitution for any other rights or
remedies of Landlord under this Lease or otherwise nor shall same be construed
to preclude Landlord from exercising its right of re-entry by summary
proceedings or otherwise on the grounds of nonpayment of rent or on the grounds
of any other default hereunder.
11. Insurance:
A. Landlord
at Tenant’s cost and expense, shall keep in full force and effect during the
Term, subject to the last paragraph of this Section “11.A”:
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Commercial
General Liability (CGL) Insurance providing Landlord with public liability
and property damage insurance in the limit of $1,000,000 per
occurrence/$2,000,000 in the aggregate for bodily injury and property
damage, to cover the entire Demised Premises and sidewalks in front of and
adjacent thereto, and which provides notice to Landlord at least thirty
(30) days prior to any effective date of cancellation.
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Insurance
against loss or damage by fire and such other risks as may be included in
the Special Form or broader if available of extended coverage in an amount
equal to 100% of the full replacement cost of the Building and
Improvements (excluding foundations, excavations and footings), ordinance
or law and demolition costs coverage in an amount that Landlord shall deem
reasonably appropriate and agreed value coverage or waiver of co-insurance
coverage.
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Rental
value insurance, insuring landlord against loss of gross rental
(including, without limitation, additional rent) due to the occurrence of
any of the hazards described in the preceding subsection of this
paragraph, provided however, that Tenant shall not be obligated to pay the
cost of any premium therefor insuring such loss of rental for a period
greater than twelve (12) months.
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Insurance
against the hazards covered by a policy of boiler
insurance.
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Insurance
for the loss or damage caused from leakage of sprinkler systems now or
hereafter installed in the building on the Demises
Premises.
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Hired
but not owned automobile coverage as maybe required by the umbrella
liability carrier.
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Worker’s
compensation insurance and employer’s liability coverage in statutory
limits, and New York disability insurance as required by
law.
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Landlord
shall deliver to Tenant proof of the extent of the coverage being provided and
the cost thereof. Tenant shall pay to the Landlord as Additional Rent for
premiums paid or payable for insurance to be maintained by Landlord and as
hereinafter provided.
-9-
Nothing
herein contained shall be construed to require Landlord to insure the contents
or stock in trade belonging to Tenant and located upon the Demised Premises, nor
to insure installation made by Tenant which are removable by Tenant upon the
termination of this Lease. Tenant shall provide to Landlord proof of its
contents coverage, which Tenant agrees to maintain throughout the Term. Such
contents coverage shall include coverage of the improvements made to the Demised
Premises by Landlord for Tenant’s use.
Tenant,
at its own cost and expense, shall promptly comply with all rules, orders and
regulations of the New York Board of Fire Underwriters or other similar body,
and such tests and inspections of the sprinkler system and areas of possible
fire hazards in the Demised Premises arising from the conduct of Tenant’s
business as Landlord’s insurance carrier may from time to time require. Tenant
shall also conduct at its sole cost and expense quarterly sprinkler tests and
annual fire extinguisher inspections and post same on the sprinkler valve and
fire extinguishers, respectively, to the extent required by applicable law or
requirement of the applicable insurance company or underwriter.
Landlord
shall not charge Tenant for its umbrella liability insurance, hired but not
owned automobile coverage and worker’s compensation insurance coverage. With
regard to Landlord’s coverages that Tenant is paying for under this Lease, from
time to time, within thirty (30) days prior to any insurance policy renewal
date, Tenant will have the right to get competitive quotes on such insurance
coverages and inform Landlord of same. Provided such quotes are for the
identical coverages (including, without limitation, the amounts and quality of
coverage) after reasonable verification by Landlord, and to the extent that the
prices quoted to Tenant are equal to a cost differential of at least five
percent (5%), then Landlord agrees to credit Tenant’s insurance invoice in an
amount equal to the cost differential, so long as such lower priced quote is
valid and readily available. In addition, it is acknowledged by Tenant that
Landlord is not obligated to place its insurance coverages with the Tenant’s
insurer agent providing such quote to Tenant.
B. During
the Term, for the mutual benefit of Landlord and Tenant, Tenant shall keep in
full force and effect the following:
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a
commercial general liability (“CGL”) insurance protecting and indemnifying
Landlord against any and all claims and liabilities for injury or damage
to persons or property or for the loss of life or of property occurring
upon, in or about the Demised Premises, and the public portions of the
Land, if any, such insurance to afford minimum protection during the Term
of not less than $1,000,000 per occurrence/$2,000,000 in the aggregate for
bodily injury and for property damage and not less than $14,000,000 in the
aggregate, and fire damage legal liability for an amount equal to the full
replacement cost of the Demised Premises. This policy shall be an
occurrence policy on Insurance Services Office, INC. (“ISO”) form CG0001
0196 or an equivalent occurrence basis CGL policy form that is reasonably
acceptable to Landlord. The CGL shall have contractual liability coverage.
Said insurance policy shall name Landlord and its Mortgagee/Master Lessor
as additional insureds.
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worker’s
compensation insurance and employer’s liability coverage in statutory
limits, and New York State disability insurance as required by Law,
covering all employees; and
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such
other coverage as Landlord may reasonably require with respect to the
Demised Premises, Tenant’s use and occupancy and the conduct or operation
of business therein provided same is generally required of tenants of
properties similar to the Demised Premises. Landlord may, from time to
time, but not more frequently than once every year, adjust the minimum
limits set forth above, accounting for inflation or changes in industry
standards.
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-10-
| C. | All the Tenant’s insurance shall contain endorsements sufficient to effect the following: | |
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(a)
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in
no event shall the insurance coverage under such policies be brought into
contribution with any policies maintained by the
Landlord;
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(b)
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the
interest of Landlord or Landlords’ Mortgagees, as additional insureds,
shall not be invalidated by any breach or violation by the Tenant, any
undertenant, or any other named insured, of any of the warranties,
declarations or conditions of the policies;
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(c)
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the
“save harmless” and indemnification obligations of the Tenant pursuant to
this Lease shall be insured as a contractual
obligation;
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(d)
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the
insurer will not cancel or refuse to renew the policy, or change in any
material way the nature or extent of the coverage provided by such policy
without first giving the Landlord thirty (30) days’ prior written
notice;
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(e)
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that
such policy and the coverage evidenced thereby shall be primary with
respect to any policies carried by Landlord, and that any coverage carried
by Landlord shall be excess insurance;
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(f)
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a
waiver by the insurer of all rights of subrogation against the Landlord,
its members, directors, partners, officers, employees, or representatives,
which arises or might arise by reason of any payment under such policy or
by reason of any act or omission of Landlord, its directors, partners,
officers, members, employees, or
representatives.
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All
the insurance carriers shall be licensed in the State of New York and, shall at
all times during the Term have a policyholder’s rating of not less than “A+/12”
in the most current edition of Best’s Insurance Reports. Tenant shall deliver to
Landlord proof of payment of premiums for all insurance within seven (7) days of
receipt of request.
Landlord
may require increases in the policy limits from time to time (not more often
than once each thirty six (36) months) to reflect the effect of inflation, based
upon increases in the United States Consumer Price Index or similarly recognized
index.
Each
party agrees to use all commercially reasonable efforts to include in each of
its insurance policies against loss, damage or destruction by fire or other
insured event, a waiver of the insurer’s right of subrogation against the other
party. If such waiver, agreement or permission shall not be, or shall cease to
be, obtainable without additional charge or at all, the insured party shall so
notify the other party promptly after learning thereof. In such case, if the
other party shall agree in writing to pay the insurer’s additional charge
therefor, such waiver, agreement or permission shall (if obtainable) be included
in the policy. So long as Landlord’s and Tenant’s policies then in force include
such waivers of subrogation, Landlord and Tenant, to the fullest extent
permitted by law, each waive all right of recovery against the other and agree
to release the other from liability from loss or damage to the extent such loss
or damage is covered by valid and collectable insurance in effect at the time of
such loss of damage.
-11-
None
of Tenant insurance policies shall have a deductible in excess of $25,000.00.
Tenant agrees that notwithstanding any such permitted deductible in their
insurance policies, it shall be liable for the amount of the deductible. Any
insurance required by Tenant under this Lease may be furnished by Tenant under a
blanket policy carried by it. Such blanket policy shall: (i) comply with all
provisions above, (ii) reference the Demised Premises; and (iii) guarantee
minimum limits available for Demised Premises equal to the insurance amounts
required by this Lease.
Before
Tenant enters the Demised Premises to conduct any activity permitted under this
Lease, including any entry permitted under Section “7.E” of this Lease, Tenant
shall furnish Landlord with an appropriate certificate evidencing the aforesaid
insurance coverage being then in effect, on an ▇▇▇▇▇ 27 form (or its
equivalent). Renewal policies or certificates therefor shall be furnished to
Landlord at least thirty (30) days prior to the expiration date of each policy.
Landlord may at any time and from time to time, inspect and/or copy any and all
insurance policies required to be procured by Tenant by this Lease.
In
the event Tenant fails to procure, maintain, and/or pay for and deliver proof
thereof to Landlord of the insurance required by this Lease, at the times and
for the durations specified in this Lease, Landlord shall have the right, but
not the obligation, at any time and from time to time after two business days
notice to Tenant and Tenant’s failure to comply to procure such insurance and/or
pay the premiums for such insurance, in which event Tenant shall repay Landlord,
immediately upon demand by Landlord, as Additional Rent, all sums so paid by
Landlord together with interest thereon at the Interest Rate and any costs or
expenses reasonably incurred by Landlord in connection therewith, without
prejudice to any other rights and remedies of the Landlord under this
Lease.
12. Condition of
Premises: EXCEPT AS OTHERWISE SET FORTH IN THIS LEASE, SUBJECT TO (X)
LANDLORD’S COMPLETION OF THE BUILDING WORK AND ANY PUNCH LIST ITEMS, (Y)
LANDLORD’S PERFORMANCE OF ANY WORK WHICH IT IS OBLIGATED TO PERFORM PURSUANT TO
LANDLORD’S WARRANTY SET FORTH IN SECTION “7.G”, ABOVE, AND (Z) LANDLORD’S
PERFORMANCE OF ITS MAINTENANCE OBLIGATIONS SET FORTH IN THIS LEASE, BELOW,
TENANT REPRESENTS, WARRANTS AND ACKNOWLEDGES TO LANDLORD AND AGREES WITH
LANDLORD THAT TENANT IS HEREBY ACQUIRING A LEASEHOLD INTEREST IN AND TO THE
DEMISED PREMISES AND SHALL ACCEPT SAME AND THE LAND IN THEIR “AS IS”, “WHERE IS”
CONDITION “WITH ALL FAULTS” AND SPECIFICALLY AND EXPRESSLY WITHOUT ANY
WARRANTIES, REPRESENTATIONS OR GUARANTEES, FROM OR ON BEHALF OF LANDLORD,
REGARDING THE CONDITION OF THE DEMISED PREMISES OR THE LAND, ITS HABITABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE, VALUE, PROFITABILITY, MARKETABILITY,
MERCHANTABILITY OR COMPLIANCE WITH GOVERNMENTAL LAWS, ORDINANCES OR REGULATIONS,
OR ANY OTHER WARRANTY (WHETHER EXPRESS OR IMPLIED, ORAL OR WRITTEN, MATERIAL OR
IMMATERIAL). TENANT ACKNOWLEDGES THAT IT HAS NOT RELIED, AND IS NOT RELYING,
UPON ANY INFORMATION, DOCUMENT, SALES BROCHURE OR OTHER LITERATURE, MAPS OR
SKETCHES, PROJECTION, STATEMENT OR REPRESENTATION THAT MAY HAVE BEEN GIVEN OR
MADE BY OR ON BEHALF OF LANDLORD TO TENANT EXCEPT AS OTHERWISE EXPRESSLY SET
FORTH HEREIN TO THE CONTRARY. TENANT AGREES TO ACQUIRE THE LEASEHOLD INTEREST IN
THE DEMISED PREMISES BASED SOLELY ON ITS OWN INDEPENDENT INVESTIGATION AND
INSPECTION OF THE DEMISED PREMISES AND TENANT’S INDEPENDENT EVALUATION OF THE
DEMISED PREMISES, AND EXCEPT AS EXPRESSLY SET FORTH IN THIS LEASE, LANDLORD IS
NOT OBLIGATED TO ALTER, MODIFY, REMEDIATE OR IMPROVE THE DEMISED PREMISES IN ANY
WAY WHATSOEVER.
-12-
13. Disposal of
Refuse: Tenant shall, at its sole cost and expense, promptly contain
and dispose of all garbage, rubbish, trash, or waste and/or refuse generated at
the Demised Premises, in accordance with applicable laws, rules and orders of
all governmental authorities who have jurisdiction thereof and in accordance
with Landlord’s reasonable instructions. Tenant shall not permit the
accumulation of any rubbish or garbage in, or about any part of the Demised
Premises. Tenant shall indemnify and hold Landlord harmless, from and against
any and all liability, including reasonable attorneys’ fees, which is related or
connected to Tenant’s garbage, rubbish, trash, or waste and the disposal
thereof. Tenant shall not commit or suffer, and shall use all reasonable
precautions to prevent waste, damage or injury to the Demised
Premises.
14. Sidewalks: Tenant shall
not encumber or obstruct, or permit to be encumbered or obstructed, the street
and sidewalk, if any, on, adjacent to or abutting the Demised Premises. Tenant
shall, at its sole cost and expense, keep said sidewalks adjacent to the Demised
Premises free of dirt, snow, ice, rubbish and debris.
15. Broker: Each party
represents and warrants to the other that it dealt with no broker with respect
to this Lease or the Demised Premises. Each party shall indemnify, defend with
counsel reasonably acceptable to the other and save the other harmless of, from
and against any and all claims for commissions or compensation made by any
broker or entity, arising out of or relating to the acts of the indemnifying
party, its employees or agents and all expenses and fees, including reasonable
attorneys’ fees, related thereto.
16. Landlord’s
Liability: Landlord and Landlord’s officers, directors, shareholders,
members, agents and employees shall not be liable to Tenant, Tenant’s agents,
employees, shareholders, officers, directors or third parties for any injury to
person or damage to property for any reason whatsoever, including, but not
limited to, failure to repair, defect in, or failure of, equipment, pipes,
wiring, broken glass, backing up of drains, or by gas, water, snow, ice, hail,
rain, electricity or oil leaking, escaping or flowing into the Demised Premises,
except to the extent due to the negligence or wrongful acts of Landlord, its
agents, contractors or employees.
Notwithstanding
anything herein or any rule of law or statute to the contrary, it is expressly
understood and agreed that to the extent that Landlord shall at any time have
any liability to Tenant under, pursuant to or in connection with this Lease,
Tenant, and any officer, director, stockholder, partner, associate, principal,
or party claiming through or on behalf of Tenant shall look solely to the
Demised Premises (and the proceeds therefrom) for the satisfaction of any
judgment (or other judicial order) requiring the payment of money by Landlord,
and they shall not seek to obtain or enforce any personal or money or other
judgment against Landlord, or any officer, member, director, stockholder,
partner, associate, employee, agent or principal (disclosed or undisclosed) of
Landlord, except against Landlord’s interest in the Demised Premises (and the
proceeds therefrom), and in no event shall Landlord or such other party have any
personal liability or monetary or other obligation of any kind under or pursuant
to this Lease beyond such interest in the Demised Premises.
-13-
If
Tenant shall at any time claim that Landlord unreasonably withheld its consent
to any act to which Landlord has agreed hereunder not to unreasonably withhold
its consent, Landlord’s sole obligation or liability to Tenant therefor shall be
to consent thereto if Tenant prevails against Landlord in an action for
injunction or declaratory judgment brought in a court of competent jurisdiction,
and Tenant hereby waives and relinquishes any and all claims for damages or
other money compensation by reason thereof. Notwithstanding the foregoing, any
dispute between the parties relating to the withholding or delay of consent by
Landlord may be determined, at Tenant’s option, under the Expedited Procedures
provisions of the Commercial Arbitration Rules of the American Arbitration
Association. In any such proceeding, the arbitrator shall have no right to award
monetary damages, provided, however, that in the event that the arbitrator
determines that Landlord unreasonably withheld its consent, then Landlord shall
reimburse Tenant for Tenant’s reasonable attorney’s fees incurred in connection
with such arbitration. If the arbitrator rules in favor of Landlord, then Tenant
shall reimburse Landlord for Landlord’s reasonable attorney’s fees incurred in
connection with such arbitration.
17.
Estoppel
Certificates/Financial Statements: Each party shall, without charge,
at any reasonable time and from time to time, within ten (10) business days
after request by the other, certify by written instrument, duly executed,
acknowledged and delivered, to the other and/or any present or proposed
Landlord, purchaser, Mortgagee; Master Lessor, assignee of any Mortgagee or
Master Lessee or any permitted assignee or subtenant:
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(i) that
this Lease is unmodified and is in full force and effect (or, if there has
been modification, attaching same and stating whether or not the Lease is
in full force and effect as modified);
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(ii) that
there are not then existing any set-offs or defenses against the
enforcement of any of the agreements, terms, covenants or conditions
hereof upon the part of Tenant to be performed or complied with (or, if
so, specifying the same);
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(iii) the
dates, if any, to which Fixed Annual Rent and Additional Rent have been
paid and the amounts thereof; and
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(iv) to
such other matters pertaining to this Lease that are within such party’s
knowledge as may be requested.
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Tenant
hereby constitutes and appoints Landlord Tenant’s attorney-in-fact to execute
and deliver any such estoppel certificate requested by Landlord if, after ten
(10) days notice, Tenant fails to execute and return any such document provided
to Tenant for execution.
18.
Permits and
Compliance with Law: Tenant shall not use or suffer or permit any
person to use the Demised Premises for any unlawful purpose. Tenant shall apply
for and obtain and maintain at Tenant’s sole cost and expense all licenses and
permits from any and all governmental authorities having jurisdiction of the
Demised Premises which may be necessary for the conduct of Tenant’s business
therein. Tenant shall also pay all fees in connection with any licenses or
permits required by the local municipal authority for any equipment or machinery
at the Demised Premises whether owned by the Landlord or the Tenant. Tenant
further covenants to comply with all present and future applicable laws,
resolutions, codes, rules and regulations of any department, bureau, agency or
any governmental authority having jurisdiction over the operation, occupancy,
maintenance and use of the Demised Premises and all insurance requirements and
recommendations. Tenant also covenants to comply with any and all regulations
and rules applicable to the Demised Premises issued by the Board of Fire
Underwriters or by any other body hereinafter constituted exercising similar
functions, and by insurance companies writing policies covering the Demised
Premises and the Improvements which now or hereafter may become applicable to
the Demises Premises.
-14-
Without
diminishing the obligation of Tenant, if Tenant shall at any time fail or
neglect to comply to the extent reasonably appropriate, and as expeditiously as
reasonably feasible, with any of said laws, rules, requirements, orders,
directions, ordinances or regulations, concerning or affecting the Demised
Premises or the use and occupation thereof, as herein provided, Landlord, in
addition to any other remedies, shall, upon ten (10) business days’ written
notice to Tenant, unless in an emergency then without notice, be at liberty to
comply therewith, and all reasonable expenses of Landlord in connection
therewith shall be paid by Tenant, and upon Tenant’s failure so to pay, Landlord
may pay the same and any payments so made by Landlord shall be reimbursed to
Landlord by Tenant as Additional Rent with interest to be paid at the Interest
Rate together with the installment of Fixed Annual Rent next coming due and
shall entitle Landlord to enforce any of the terms, provisions, conditions and
covenants herein contained that may be applicable to such rent.
Tenant
shall have the right, after prior written notice to Landlord, and after
obtaining any required stay, to contest by appropriate legal proceedings,
diligently conducted in good faith, in the name of Tenant, without cost or
expense to Landlord, the validity or application of any law, ordinance, rule,
order, regulation or requirement, including, but not limited to, any law,
ordinance, rules, orders, regulations and requirements purporting to require the
repairs to the Demised Premises referred to above, provided that no lien, charge
or liability of any kind may or shall be created thereby against the Demised
Premises or shall subject Tenant or Landlord to any liability, civil or
criminal, for failure to comply therewith.
Tenant
shall, at all times duringthe Term, at Tenant’s sole cost and expense, promptly
comply with all present and future laws, orders and regulations issued or
promulgated by any governmental or quasi governmental agency or body, whether
federal, state, city, county, town, village or other municipal level, regulating
or otherwise asserting jurisdiction over the Demised Premises, or Tenant’s use
and occupancy thereof, or over air, water or ecological or environmental
pollutants and all insurance requirements and recommendations. Tenant shall
indemnify and save Landlord, its officers, directors, shareholders, members,
partners, employees and Mortgagees (“Landlord Indemnified Parties”) harmless
from and against any claims, penalties, loss, damage or expense imposed by
reason of a violation of any applicable law or the rules and regulations of
governmental authorities having jurisdiction thereof relating to the Demised
Premises or the failure of Tenant to obtain or maintain any required licenses or
permits.
Landlord
agrees to be responsible for municipal violations as of the Commencement Date
not caused by Tenant, or as may be caused thereafter by Landlord’s or its
agent’s actions.
19. Indemnification of
Landlord: Tenant shall indemnify and save harmless the Landlord
Indemnified Parties from any and all liabilities, damages, expenses, actions,
claims or judgments, including reasonable attorney’s fees regardless of whether
a lawsuit is actually commenced, arising from injury to any person or persons or
property which may occur in or on the Demised Premises, or from any matter or
thing which is connected or related to Tenant’s acts or occupation of the
Demised Premises, unless due to the negligence or wrongful act of a Landlord
Indemnified Party, in which case Landlord will indemnify Tenant and its
officers, directors, agents and employees. In such event, Tenant upon notice
from a Landlord Indemnified Party shall resist or defend such action or
proceeding (by counsel appointed by Tenant’s insurance carrier or other counsel
reasonably satisfactory to the Landlord Indemnified Party), unless Tenant causes
the same to be discharged and satisfied.
Tenant
shall also indemnify and hold harmless Landlord against and from any costs and
expenses paid or incurred by Landlord in obtaining possession of the Demised
Premises after default by Tenant as may be provided by the terms of this Lease
or upon the expiration or sooner termination of this Lease, or in enforcing any
of Tenant’s obligations hereunder including Landlord’s reasonable attorney’s
fees, all of which shall be deemed Additional Rent.
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(A) Provided
Tenant obtains a Non-Disturbance Agreement from the applicable Mortgagee or
Master Lessor, as the case may be, this Lease shall be subject and subordinate
to all ground or underlying leases (“Master Leases”) and to all mortgages
(“Mortgages”) which may now or hereafter affect such leases or the real property
of which Demised Premises are a part and to all renewals, modifications,
consolidations, replacements and extensions of any such Master Leases and
Mortgages. (Upon acquisition of the Land per the Purchase and Sale Agreement
referred to in Section “3”, above, Landlord anticipates that the Land will be
subject to a mortgage.) This clause shall be self-operative and no further
instrument of subordination shall be required by any Master Lessor or by any
Mortgagee, affecting any lease of the real property of which the Demised
Premises are a part. In confirmation of such subordination, Tenant shall execute
promptly any certificate that Landlord may reasonably request.
(B) Provided
Tenant shall receive a Non-Disturbance Agreement (as hereinafter defined),
Tenant shall and does hereby agree to attorn to the holder of each and every
Mortgage (“Mortgagee”) and landlord under all Master Leases (“Master Lessor”)
and to recognize such Mortgagee and/or Master Lessor as its landlord. Tenant
hereby constitutes and appoints Landlord Tenant’s attorney-in-fact to execute
and deliver an agreement of attornment for or on behalf of Tenant substantially
in the form of the document attached hereto as Exhibit “E” if, after
ten (10) days notice, Tenant fails to execute and return any such document
provided to Tenant for execution.
(C) If,
in connection with the procurement, continuation or renewal of any financing for
which the Demised Premises represents security in whole or in part, a bank or
institutional lender shall request reasonable modifications of this Lease as a
condition of such financing, Tenant will not withhold consent thereto, provided
that such modifications do not materially increase the obligations of Tenant
under this Lease or materially and adversely affect any rights of Tenant
hereunder. Without limiting the foregoing, any modification which increases the
rents or costs payable by Tenant shall be deemed to materially affect Tenant’s
rights under this Lease. Tenant shall consent or object to such modification
within ten (10) business days following Landlord’s request. A modification
providing that Tenant be required to give notices of any defaults by Landlord to
such lender and/or permit the curing of such default by such lender with or
without the granting of such additional time for such curing shall not be deemed
to materially adversely affect Tenant’s rights.
(D) For
purposes hereof a “Non-Disturbance Agreement” shall mean an agreement on
Mortgagee’s or Master Lessor’s form which is reasonably acceptable to Tenant.
With respect to any Mortgages or Master Leases which subsequently encumber the
Demised Premises, Landlord shall provide Tenant with a Non-Disturbance Agreement
within four (4) weeks after the execution of the Mortgage or Master Lease, and
the subordination of this Lease to such Mortgage or Master Lease is expressly
contingent upon the delivery of such Non-Disturbance Agreement.
(E) In
the event of notice to such effect from Landlord to Tenant, to the extent
requested by the Mortgagee or Master Lessor, Tenant shall agree to the following
(and, if requested, this Lease shall be amended to provide):
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(i) Mortgagee
or Master Lessor shall under no circumstances have any obligation to
refund Tenant’s security deposit to Tenant except to the extent Landlord
has transferred said security deposit to Mortgagee or Master
Lessor;
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(ii) Mortgagee
or Master Lessor shall be added as an additional insured on any insurance
policy required to be obtained by Tenant and forward a certificate
evidencing same to Mortgagee or Master
Lessor;
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(iii) The
use of any condemnation or casualty insurance proceeds shall be subject to
reasonable lender requirements, provided however that the funds shall be
made available to Landlord for repair and restoration;
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(iv) This
Lease may not be amended without the prior written consent of Mortgagee or
the Master Lessor;
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(v) Tenant
shall provide Mortgagee or Master Lessor with copies of all notices of
default it sends to Landlord and shall permit Mortgagee or Master Lessor
to cure any default by Landlord under this Lease;
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(vi) In
the event Mortgagee or Master Lessor or its successors or assigns succeeds
to the rights of Landlord, Mortgagee or Master Lessor or its successors
and assigns shall not be liable for any defaults of Landlord or
obligations of Landlord which arose prior to Mortgagee or Master Lessor or
its successor or assigns acquiring title to the Demised Premises, except
to the extent such default shall be continuing;
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(vii) In
the event of any act or omission of Landlord that would give Tenant the
right, immediately or after lapse of a period of time, to cancel or
terminate this Lease, or to claim a partial or total eviction, Tenant
shall not exercise such right
until:
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(a) it
has given written notice of such act or omission to each Mortgagee and
Master Lessor whose name and address shall previously have been furnished
to Tenant; and
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(b) a
reasonable period for remedying such act or omission shall have elapsed
following the giving of such notice and following the time when such
Mortgagee or Master Lessor shall have obtained possession of the Demised
Premises and become entitled under such Mortgage or Master Lease, as the
case may be, to remedy the same (which reasonable period shall in no event
be less than the period to which Landlord would be entitled under this
Lease or otherwise, after similar notice, to effect such remedy). Nothing
contained herein shall obligate such Master Lessor or Mortgagee to remedy
such act or omission.
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(F)
Upon Landlord’s written request, in order to aid Landlord in
the sale, financing or refinancing the Demised Premises, Tenant shall promptly
furnish Landlord with such financial statements reflecting the financial
condition of Tenant as Tenant has prepared in the ordinary course of its
business within thirty (30) days of request from Landlord. Landlord shall keep
such information confidential and shall not release such information as to any
prospective purchaser or lender unless it receives an agreement from the
recipient agreeing to maintain the confidentiality of such information among
itself and its advisors, except that no such confidentiality arrangement shall
be required if the information Tenant provides is public
information.
21.
Security of the Demised Premises: During the Term,
Tenant shall be responsible for any and all security at the Demised
Premises.
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22. Covenant Against Liens: Tenant shall not do any act or make
any contract which may create or be the foundation for any lien or other
encumbrance upon any interest of Landlord in any portion of the Demised
Premises.. If, because of any act or omission (or alleged act or omission) of
Tenant, any mechanic’s lien or other lien, charge or order for the payment of
money shall be filed against Landlord or any portion of the Demised Premises
(whether or not such lien, charge or order is valid or enforceable as such),
Tenant shall, at its own cost and expense, cause same to be discharged of record
or bonded within thirty (30) business days after notice to Tenant of the filing
thereof; and the Tenant shall indemnify and save harmless the Landlord
Indemnified Parties against and from all costs, liabilities, suits, penalties,
claims and demands, including reasonable counsel fees resulting therefrom. If
Tenant fails to comply with the foregoing provisions, Landlord shall have the
option of discharging or bonding any such lien, charge or order and the Tenant
agrees to reimburse Landlord (as Additional Rent) with interest at the Interest
Rate payable promptly upon demand. All materialmen, contractors, artisans,
mechanics, laborers and any other persons now or hereafter contracted with by
Tenant for the furnishing of any labor, services, materials, supplies or
equipment with respect to any portion of the Demised Premises at any time from
the date hereof until the end of the demised term are hereby charged with notice
that they must look exclusively to Tenant to obtain payment for
same.
23. Hazardous Materials: Except as otherwise
permitted herein, Tenant and its subtenants, operators, franchisees, licensees,
employees, agents or contractors shall not use, store, release, dispose of,
suffer, permit, introduce or maintain in, on or about any portion of the Demised
Premises any asbestos, polychlorinated biphenyls, petroleum products or any
other materials, wastes or substances (collectively “Hazardous Materials”) which
are defined, determined or identified as hazardous or toxic in any federal,
state or local laws, rules or regulations (whether now existing or hereafter
enacted or promulgated) or any judicial or administrative interpretation of any
thereof, including, but not limited to, any judicial or administrative orders,
decrees, letters or judgments (herein collectively called “Environmental
Laws”).
Notwithstanding
the foregoing, Tenant, its agents, employees, contractors, etc., may store and
use Hazardous Materials in connection with the normal operation of its business
and/or maintenance of the Demised Premises as long as Tenant: (i) provides to
Landlord, upon request, a list of all hazardous materials used and stored in
quantities that would need to be reported to any governmental agency pursuant to
Environmental Laws; (ii) provides a written description of the means of storage
and disposal of said Hazardous Materials; (iii) upon Landlord’s request, updates
the list of chemicals and means of storage and disposal when changes occur; (iv)
permits Landlord or its representatives to periodically inspect the storage and
disposal facilities; and (v) complies with all applicable Environmental Laws and
any other obligations of Tenant under this Lease.
Within
two (2) business days of receipt, Tenant shall provide Landlord with (i) copies
of all notices received by it, including, without limitation, any notices of
violations, notices of responsibility or demand for action from any federal,
state or local authority or official in connection with the presence of
Hazardous Materials in or on the Demised Premises, and (ii) any information it
receives regarding the release, storage, disposal or presence of Hazardous
Materials at the Demised Premises in violation of the Environmental Laws. Tenant
shall indemnify, defend with counsel reasonably acceptable to Landlord, protect
and save the Landlord Indemnified Parties harmless against and from any and all
claims, litigation, demands, defenses, judgments, suits, proceedings, costs,
disbursements or expenses of any kind or of any nature whatsoever (including,
without limitation, reasonable attorneys’ and experts’ fees and disbursements)
which may at any time be imposed upon, incurred by or awarded against the
Landlord Indemnified Partners arising from or out of (i) the violation or
alleged violation of any Environmental Laws by Tenant, its subtenants,
operators, franchisees, licensees, employees, agents, assigns or contractors and
(ii) any Hazardous Materials introduced, released, disposed of or otherwise on,
in, under or affecting all or any portion of the Demised Premises, which were
the result, whether in whole or in part, of any act or omission of Tenant, its
subtenants, operators, franchisees, licensees, employees, agents, assigns or
contractors, including, without limitation, (A) the costs of removal of any and
all Hazardous Materials from all or any portion of the Demised Premises, (B)
additional costs required to take necessary precautions to protect against the
release of Hazardous Materials on, in, under or affecting the Demised Premises,
into the air, body of water, any other public domain or any surrounding areas,
(C) the costs of monitoring any portion of the Demised Premises or any area
lying outside of same in the event of fear of off-site contamination, and (D)
any costs incurred to comply, in connection with all or any portion of the
Demised Premises, with all applicable laws, orders, judgments and regulations
with respect to Hazardous Materials.
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Prior
to the expiration of the Term and after the Effective Date or earlier occupancy
of the Demised Premises, at any time that a release, leak, spill or discharge
has occurred, or upon notification from any administrative or enforcement agency
that a release, leak, spill or discharge of Hazardous Materials that requires
investigation and remediation may have occurred at the Demised Premises, Tenant
shall, at Tenant’s sole expense, retain an environmental consultant reasonably
satisfactory to Landlord, to undertake and complete investigations at the
Demised Premises sufficient to ascertain whether Tenant’s use of the Demised
Premises has resulted in a release, leak, spill or discharge of Hazardous
Materials at the Demised Premises. Any investigations performed pursuant to this
Section “23” shall include, at a minimum, such tests on any cesspool or sewer
drain as are necessary to determine that the cesspool or sewer drain is in
operating condition and free of Hazardous Materials, and such soil and
groundwater sampling as is necessary to determine the nature and extent of any
such release, leak, spill or discharge that has occurred. Should the
investigations performed reveal that as a result of Tenant’s use of the Demised
Premises, Hazardous Materials have been released, spilled, leaked or discharged,
Tenant shall, prior to Tenant vacating the Demised Premises, at Tenant’s sole
expense and to the complete satisfaction of any administrative or enforcement
agency with jurisdiction over the Demised Premises, perform such investigatory
and remedial activities and at a minimum return the Demised Premises to the
environmental condition it was in prior to Tenant’s occupancy. If Tenant fails
to perform such investigatory and remedial activities, Tenant agrees to
reimburse Landlord for the reasonable cost incurred by Landlord or its agents to
undertake and complete those activities. Should the investigations performed
reveal that the cesspool and sewer drain are not in operating condition and free
of Hazardous Materials, Tenant shall repair same to the satisfaction of
Landlord.
Tenant
shall be responsible for all costs related to the investigation, removal,
remediation and Landlord’s other responses, as the case may be, to any Hazardous
Materials generated, stored or disposed of contrary to the provisions of this
Lease which are revealed by the Enviromnental Update (as defined below) (or any
inspection by Landlord prior to Tenant’s delivery of the Demised Premises to
Landlord).
The
provisions of this Section “23” shall survive the expiration or sooner
termination of this Lease.
24. Environmental Audits:
A. Landlord
Conducts Initial Audit. On or before the Commencement Date, Landlord shall, at
its sole cost and expense, provide to Tenant a Phase 1 environmental assessment
of the Land, together with such additional reports and testing (including Phase
2 environmental assessment) if necessary in Landlord’s sole discretion from an
environmental consultant selected by Landlord (“Initial Environmental Audit”).
Tenant acknowledges that any environmental information provided to it by or on
behalf of Landlord under this Lease is confidential information of Landlord and
any and all of the environmental assessments, studies, test results, reports,
plans, records and documents regarding the Dernised Premises given to or in
receipt of Tenant and/or its officers, employees, agents and contractors, shall
be held in confidence and shall not be disclosed to any third party unless
permitted by Landlord, in writing, which permission shall not be unreasonably
withheld. Tenant shall not contact or communicate with any regulatory agency
with regard to the Demised Premises without the express written permission of
Landlord. However, if Tenant believes it is required to provide environmental
information to a governmental agency or in connection with a pending litigation,
for example in response to a subpoena or to comply with reporting requirements
under Environmental Laws, Tenant shall inform Landlord of its intent to disclose
the information and, prior to disclosure, provide Landlord with a reasonable
time to try to prevent the disclosure, provided, however, Tenant shall not be
required to delay disclosure of such information if such delay would pose any
risk of liability to Tenant.
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B. Tenant
Conducts Update. After Tenant has vacated the Premises in accordance with the
terms and conditions of this Lease, no later than thirty (30) days after the
expiration or sooner termination of this Lease, Tenant shall at its sole cost
and expense, provide Landlord with a Phase 1 environmental assessment of the
Demised Premises, together with such additional reports and testing (including a
Phase 2 environmental assessment) if recommended by the report using the
consultant who initially prepared the Initial Environmental Audit or, if that
consultant is unavailable, another licensed environmental consultant reasonably
acceptable to Landlord, to determine environmental status of the Premises as of
the date of that Environmental Update (“Environmental Update”).
C. Tenant
shall permit Landlord and Landlord’s servants, employees and agents, including,
but not limited to, legal counsel, environmental consultants and engineers,
access to the Demised Premises upon reasonable prior written notice, except in
an emergency then without notice, for purposes of performing environmental
inspections and sampling, during regular business hours, or other hours either
by agreement of the parties or if an emergency, at any time. If the inspections
performed pursuant to this Section involve sampling and testing, Landlord shall
use reasonable business efforts to avoid interfering with Tenant’s use of the
Demised Premises.
D. The
provisions of this Section “24” shall survive the expiration or sooner
termination of this Lease.
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25. Tenant’s Alterations:
A. Nonstructural
Alterations. From and after the completion of the Building Work, upon prior
written notice to Landlord for any nonstructural alteration in excess of
$50,000.00 (per instance or series of instances if a unified plan), and subject
to the provisions of this Section “25.A”, and provided Tenant is not in default
under the terms of this Lease beyond any applicable grace or cure period, Tenant
may from time to time make such nonstructural alterations and additions to the
Demised Premises as Tenant deems appropriate, in or to the interior of the
Demised Premises, using reputable licensed contractors or mechanics. For any
nonstructural alteration in excess of $50,000.00 (per instance or series of
instances if a unified plan), Tenant shall submit in writing to Landlord a
description of its intended plans for Landlord’s review and approval, which
shall not be unreasonably withheld or delayed. Tenant shall reimburse Landlord
for the reasonable fee charged by its architect, if any, in reviewing Tenant’s
proposed plans. After Tenant’s plans have been approved by Landlord, Tenant
shall make no material change in any of Tenant’s plans without the prior written
consent of Landlord in each instance, which shall not be unreasonably withheld
or delayed. Tenant shall, at its expense, before making any such nonstructural
alterations and additions to the Demised Premises, obtain all permits, approvals
and certificates required by any governmental or quasi-governmental bodies and
(upon completion) certificates of final approval thereof, and shall deliver
promptly duplicates of all such permits, approvals and certificates to Landlord.
At no time shall Tenant make structural installations, alterations, or additions
to the Demised Premises, except as provided in Section “25.B”, below. For
purposes hereof, periodic redecorating, painting or recarpeting, which Tenant
may do at its sole cost from time to time during the Term, shall not require
notice to or consent of Landlord. Tenant and not Landlord shall be responsible
for those nonstructural alterations and additions made by Tenant and any
structural repairs the need for which shall result from such installations,
alterations or additions. In no event shall Landlord’s approval of any proposed
installations, alterations or additions to the Demised Premises constitute a
representation by Landlord that such work complies with the requirements of any
applicable law or regulation, including, without limitation, the requirements of
the Americans with Disability Act. Any installations, alterations or additions
made by Tenant shall be at Tenant’s sole cost and expense, shall be done in a
good and workmanlike manner and in compliance with the requirements of Section
“18”, above, and shall be compatible with the Building. Tenant shall not suffer
or permit any mechanics’ or similar liens to be placed upon the Demised Premises
for labor or materials furnished to Tenant or claimed to have been furnished to
Tenant in connection with work of any character performed or claimed to have
been performed at the direction of Tenant, and shall cause any such lien to be
released of record forthwith without cost to Landlord. Any and all Tenant
installations, alterations, and additions, in or to the Demised Premises, that
are intended to become or do become part of the real estate or fixtures therein
(other than trade fixtures that are readily removable without damage to the
Demised Premises) including, but not limited to, equipment, appliances, and
machinery, shall, upon the expiration of the Term, be fully paid for and free
and clear of any and all chattel mortgages, conditional bills of sale security
interests, or any liens or encumbrances of any kind or nature. At all times when
any installation, alterations, or addition by Tenant is in progress, there shall
be maintained, at Tenant’s cost and expense, insurance meeting the requirements
of Section “11” below and any other form of insurance coverage reasonably
required by Landlord and certificate of insurance evidencing such coverage shall
be furnished to Landlord prior to the commencement of any such work. Any
installations, alterations or additions made by Tenant to the Demised Premises,
including, without limitation, all utility systems, fixtures, machinery,
equipment, and appliances installed in connection therewith, other than personal
property that can be removed without material damage, shall become the property
of Landlord at the termination or expiration of this Lease (without any
obligation by Landlord to pay compensation therefor to Tenant), unless Landlord
elects, either at the time of Landlord’s approval of such work or upon the
Expiration Date or earlier date of Lease termination to relinquish Landlord’s
right thereto and to have them removed by Tenant, at Tenant’s expense. Tenant’s
obligation to remove such nonstructural alterations shall survive the expiration
or termination of this Lease if same is not completed by the Expiration Date or
earlier date of Lease termination. Upon removal of any and all Tenant
installations, alterations, and additions from the Demised Premises, or upon
removal of other installations as may be required by Landlord, Tenant shall
immediately, and at its expense, repair any damage to the Demised Premises or
the Building due to such removal. All property or required to be removed by
Tenant at the end of the Term shall removed from the Demised Premises by Tenant,
at Tenant’s expense.
B. Structural
Alterations.
1.
Structural
Alteration Restrictions. From and after the Commencement Date, and after
completion of the Building Work by Landlord, Tenant shall not demolish,
deconstruct, replace or materially alter the structural components of the
Demised Premises, whether voluntarily or in connection with repairs required by
this Lease (each a “Structural Alteration” and collectively, “Structural
Alterations”), unless (provided Tenant is not in default under the terms of this
Lease beyond any applicable grace or cure period) Tenant shall comply with the
following requirements:
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a. No
Structural Alteration shall be undertaken until Tenant shall have (i)
procured from all governmental authorities and paid for all permits,
consents, certificates and approvals for the proposed Structural
Alteration which are required to be obtained prior to the commencement of
the proposed Structural Alteration (collectively, “Improvement
Approvals”), and (ii) obtained Landlord’s approval to the proposed
Structural Alterations, which approval is not to be unreasonably withheld,
conditioned or delayed. The application for any such Improvement Approvals
shall be made without cost, expense or liability (contingent or otherwise)
to Landlord. To the extent necessary, Landlord shall cooperate with Tenant
in such applications, so long as Landlord incurs no expense therefor. True
copies of all such Improvement Approvals shall be delivered by Tenant to
Landlord prior to commencement of the proposed Structural
Alteration;
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b. All
Structural Alterations, when completed, shall be of such a character as
not to reduce the value of the Improvements below its value immediately
before construction of such Structural Alteration;
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c. All
Structural Alterations shall be made with reasonable diligence and
continuity and in a good and workmanlike manner and in compliance with (i)
all Improvement Approvals, (ii) the plans and specifications for such
Structural Alteration as approved by Landlord, (iii) the orders, rules,
regulations and requirements of any Board of Fire Underwriters or any
similar body having jurisdiction, (iv) Section “18”, above, and (v) all
other legal requirements;
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d. The
insurance requirements set forth below in Section
“25.B.5”;
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e. If
a Structural Alteration materially affects or impacts any item of the
Demised Premises which Landlord is to maintain under the terms of this
Lease, then Landlord shall no longer be required to maintain such specific
area affected by such alteration made by Tenant and the responsibility
therefor shall automatically pass to Tenant. For example, if Tenant
installs special HVAC equipment on the roof, then that section of the roof
which Landlord previously maintained under Section “26” hereof shall be
thereafter maintained by Tenant at Tenant’s sole cost and
expense;
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f. Any
Structural Alteration made by Tenant to the Demised Premises, other than
personal property and business equipment that can be removed without
material damage to the Demised Premises, shall become the property of
Landlord at the termination or expiration of this Lease (without any
obligation by Landlord to pay compensation therefor to Tenant), unless
Landlord elects at the time of Landlord’s approval of such work to
relinquish Landlord’s right thereto and to have them removed by Tenant, in
which event the same shall be removed from the Demised Premises by Tenant,
at Tenant’s expense. Tenant’s obligation to remove the Structural
Alteration herein shall survive the expiration or termination of this
Lease if same is not completed by the Expiration Date or earlier date of
Lease termination. Upon removal of any and all Tenant installations,
alterations, and additions from the Demised Premises, or upon removal of
other installations as may be required by Landlord, Tenant shall
immediately, and at its expense, repair and restore the Demised Premises
to the condition exiting prior to any such installations, and repair any
damage to the Demised Premises or the Improvements due to such removal.
All property permitted or required to be removed by Tenant at the end of
the Term remaining in the Demised Premises after Tenant’s removal shall be
deemed abandoned and may, at the election of Landlord, either be retained
as Landlord’s property or removed from the Demised Premises by Landlord,
at Tenant’s expense; and
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g. For
purposes of this Section “25.B”of the Lease, it shall be reasonable for
Landlord to withhold its consent to any Tenant request for consent to
Structural Alterations to be made at any time during the last two (2)
years of the Term unless such alteration is required by law, in which case
such Structural Alteration shall be made in accordance with the provisions
of this Section “25.B”.
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2. Landlord’s
Approval Requirement. With respect to any Structural Alteration, Tenant shall
furnish to Landlord the following: (i) at least ten (10) business days prior to
commencement of the proposed Structural Alteration, complete plans and
specifications for the Structural Alteration, prepared by a licensed
professional engineer or a registered architect reasonably acceptable to
Landlord, which approval shall not be unreasonably withheld; (ii) at least ten
(10) business days prior to commencement of the proposed Structural Alteration,
a contract or construction management agreement reasonably satisfactory to
Landlord in form assignable to Landlord (subject to any prior assignment to any
Mortgagee or Master Lessor), made with a reputable and responsible contractor or
construction manager approved by Landlord, which approval shall not be
unreasonably withheld, providing for the completion of the Structural Alteration
in accordance with the schedule included in the plans and specifications, free
and clear of all liens, encumbrances, security agreements, interests and
financing statements; and (iii) at least five (5) business days prior to
commencement of the proposed Structural Alteration, an assignment to Landlord
(subject to any prior assignment to any Mortgagee or Master Lessor, and subject
to Landlord’s consent, not to be unreasonably withheld) of the contract so
furnished and the bonds or other security provided thereunder, such assignment
to be duty executed and acknowledged by Tenant and by its terms to be effective
only upon any termination of this Lease or upon Landlord’s re-entry upon the
Demised Premises or following any Tenant Event of Default (as hereinafter
defined) prior to the complete performance of such contract, such assignment
also to include the benefit of all payments made on account of such contract,
including payments made prior to the effective date of such assignment. Tenant
shall pay Landlord’s reasonable out-of-pocket expenses in reviewing Tenant’s
request for permission to make a Structural Alteration, including, without
limitation, any fees of Landlord’s professionals, such as Landlord’s
architect.
Landlord
shall notify Tenant of Landlord’s determination with respect to any request for
approval required under this Section “25.B” within ten (10) business days of the
complete package from Tenant detailing the proposed Structural Alteration as
outlined above. Any disapproval shall specify Landlord’s reasons for such
disapproval. Landlord’s failure to so notify Tenant within said time period
shall be deemed to constitute the approval of the proposed Structural Alteration
by Landlord. Tenant shall not commence any Structural Alteration until Landlord
shall have given, or shall be deemed to have given, the approval required under
this Section “25.B”.
3. Obligations
Upon Completion of Structural Alterations. All Structural Alterations shall be
carried out under the supervision of a licensed architect selected by Tenant and
reasonably approved by Landlord as aforesaid. Upon completion of any Structural
Alteration or planned series of Structural Alterations, Tenant shall furnish to
Landlord upon Landlord’s request a complete set of “as built” plans for such
Structural Alteration, together with a Certificate of Occupancy (which is not
temporary but permanent) or Certificate of Completion therefor, as the case may
be, issued by the Town of Babylon or Town of Huntington, as the case may be, to
the extent a modification thereof was required.
4. Drawings.
All of Tenant’s right, title and interest in all plans and drawings required to
be furnished by Tenant to Landlord under this Lease, including, without
limitation, schematics, design development plans and the construction documents,
and in any and all other plans, drawings, specifications or models prepared in
connection with construction at the Demised Premises or Structural Alteration,
shall become the sole and absolute property of Landlord upon the expiration or
sooner termination of this Lease, except for those items proprietary to Tenant’s
business. Tenant shall deliver all such documents in Tenant’s possession or
reasonably available to Tenant to Landlord promptly upon the Expiration Date or
any earlier termination of this Lease. Tenant’s obligation under this Section
“25.B.4” shall survive the Expiration Date or earlier termination of this
Lease.
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5. Alterations
Insurance Requirements. Prior to the commencement of construction of any
Structural Alteration, Tenant shall provide, or cause to be provided, and
thereafter shall keep or cause to be kept in full force and effect, or cause to
be kept in full force and effect with respect to the Demised Premises, until
completion of such Structural Alteration, the following: (i) all policies of
insurance required to be maintained by Tenant under Section “11” of this Lease;
(ii) general liability insurance, naming contractor or construction manager as
named insured and, as additional insureds, Tenant, Landlord and each Mortgagee
or Master Lessor under a standard mortgagee clause, such insurance to insure
against liability for bodily injury and death and for property damage in such
amount as may from time to time be reasonably required by Landlord (which shall
be not less than Five Million ($5,000,000.00) Dollars, such insurance to include
operations-premises liability, contractor’s protective liability on the
operations of all subcontractors, completed operations (to be kept in force for
not less than three (3) years after completion of the Structural Alteration),
broad form contractual liability (designating the indemnity provisions of this
Lease), a broad form comprehensive general liability endorsement providing
blanket automatic contractual coverage including bodily injury to employees or
others assumed by the insured under contract and, if the contractor is
undertaking foundation, excavation or demolition work, an endorsement that such
operations are covered and that the “XCU Exclusions” have been deleted; (iii)
automobile liability insurance for all owned, non-owned, leased, rented and/or
hired vehicles insuring against liability for bodily injury and death and for
property damage in an amount not less than Five Million ($5,000,000.00) Dollars
combined single limit, with such coverage to be listed in the underlying
schedule of any umbrella or following form excess policy for a total limit of
Five Million ($5,000,000.00) Dollars, such insurance to name Tenant as named
insured and, as additional insureds, Landlord, any general contractor or
construction manager engaged by Tenant and each Mortgagee or Master Lessor under
a standard mortgagee clause workers’ compensation insurance providing statutory
New York State benefits for all persons employed in connection with the
construction at the Demised Premises and employer’s liability insurance in an
amount not less than that required by New York State law, with coverage to be
listed in the underlying schedule of any umbrella or following form excess
policy; and all-risk builder’s risk insurance written on a one hundred percent
(100%) of completed value (non-reporting) basis with limits reasonably
acceptable to Landlord, naming, to the extent of their respective insurable
interests in the Demised Premises, Tenant as named insured, and, as additional
insureds, Landlord, Mortgagee or Master Lessor, as the case may be, any
contractor or construction manager engaged by Tenant and each Mortgagee under a
standard mortgagee clause. In addition, such insurance (A) shall contain an
acknowledgment by the insurance company that its rights of subrogation have been
waived with respect to all of the insureds named in the policy and an
endorsement stating that “permission is granted to complete and occupy,” (B) if
any storage location situated off the Demised Premises is used, shall include
coverage for the full insurable value, all materials and equipment on or about
any such storage location intended for use with respect to the Demised Premises,
and (C) if materials, equipment, machinery or supplies to be used in connection
with construction are shipped to the job site from places in the contiguous
United States, the District of Columbia or Canada, the all-risk builders risk
insurance will provide transit coverage. No construction shall be commenced
until Tenant shall have delivered to Landlord the original policies of insurance
or duplicate originals or certificates thereof together with copies of such
insurance policies, as required by this Section “25.B.5”
To
the extent that the insurance coverages required pursuant to this Section
“25.B.5” duplicate those required by Section “11” hereof, Tenant shall not be
required to maintain such coverages in duplicate, but in each instance the more
extensive coverage shall be maintained.
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26. Repairs/Maintenance: Tenant shall, at its sole cost
and expense, and in a manner reasonably satisfactory to the Landlord, repair,
put, replace and maintain the Demised Premises, the Improvements, and all its
equipment, fixtures, motors, appurtenances, installations and improvements, and
every part thereof, in good repair, good working order and good condition and
which shall be deemed to include, but not exclusively, any and all maintenance,
repairs and replacements of any kind or nature required to be made to the
Demised Premises and the Improvements, of every nature and description, inside
and outside, ordinary or extraordinary, structural or non-structural, whether or
not required by statute or governmental regulations heretofore or hereafter
enacted or imposed, and to the heating, electrical, plumbing, sanitary, drains,
ventilating and air conditioning systems, fixtures and equipment. The term
repairs shall include, but not be limited to, replacements and renewals when
necessary to maintain the Improvements in good condition and repair and in
compliance with all laws and regulations, and to do so in a diligent manner so
as not to deny or neglect repair and maintenance which result in abnormal wear
and tear or the need for premature replacement of any component of the
Improvements. A copy of any repair, maintenance or replacement quote, estimate
or invoice in excess of $25,000.00, whether constituting a single event or a
series of events in the aggregate, shall be promptly provided to Landlord by
Tenant within ten (10) days of the issuance of such quote, estimate or invoice.
Notwithstanding the foregoing, Landlord shall, throughout the Term, subject to
Section “25.B” above, and subject to the other terms of this Lease, maintain at
its cost and expense, the roof structure, the roof membrane, and the exterior
structure of the Building, it being understood that the liability to Landlord
for the repair of said structural repairs is limited to such repair as did not
result from the acts, omission or default on the part of Tenant, its agents, or
employees or any third-party conducting business with Tenant.
Tenant
shall maintain and repair at its sole cost, the Demised Premises and all
improvements thereon, including all parking areas, driveways, drainage systems,
curbs, paving, sidewalks and landscaping. Tenant shall put, keep and maintain
all sidewalks on or abutting the Demised Premises, free of dirt, debris, snow,
ice and other materials.
Except
as provided in this Lease, Landlord shall not be responsible to keep or maintain
any portion of the Demised Premises, it being the intention of the parties that
Tenant shall have full and complete responsibility for maintenance and repair of
the Demised Premises.
In
the event there is any roof leak or structural repair that is the obligation of
the Landlord to make, the Landlord’s liability is limited to the making of said
repair only and in no event shall the Landlord be responsible for the
consequential damages, direct or indirect. Landlord agrees to correct these
conditions in a timely manner.
Tenant
shall not be allowed to ▇▇▇▇▇▇ the roof or walls by the installation of any
equipment without the prior written consent of the Landlord which shall not be
unreasonably withheld and the Landlord shall not be responsible for any leak
resulting from said piercing of the roof or walls.
Tenant
hereby agrees that Landlord shall not be liable for injury to Tenant’s business
or loss of income therefrom or for damage to the goods, wares, merchandise or
other property of Tenant, its employees, agents, invitees, customers or any
other person in or about the Demised Premises nor shall Landlord be liable for
injury to the person of Tenant, its employees, agents, contractors, or invitees,
where such damage or injury is caused by or results from fire, explosion, steam,
electricity, gas, water, snow or rain, except due to the negligence or wrongful
acts of Landlord or its agents, contractors or employees.
Tenant
shall not be obligated to replace or repair any major systems component of the
Improvements during the last two (2) years of the Term, unless same is
necessitated by Tenant’s failure to comply with the terms of this Lease, in
particular, this Section “26”. If Tenant has so failed to comply, then Tenant,
at its sole cost and expense, shall effectuate such replacement or repair,
regardless of when in the Term such requirement develops.
During
the last five (5) years of the Term, if an HVAC compressor or condenser which
covers the office area of the Improvements requires replacement, assuming Tenant
has conducted periodic maintenance as required from time to time under the terms
of this Lease, Landlord and Tenant shall equally share the cost of replacement.
The foregoing cost sharing commitment by Landlord shall not apply to any system
used in other areas, such as the lab or kit assembly areas.
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27. Security Deposit:
A. Upon
execution of this Lease, Tenant has deposited with a third party mutually
acceptable to the parties the sum of One Million Twelve Thousand Eight Hundred
Seventy Five and 00/100 ($1,012,875.00) Dollars (“Security Deposit”) as security
for the faithful performance and observance by Tenant of the terms, provisions
and conditions of this Lease. Such third party will temporarily hold the
Security Deposit until the Commencement Date, at which time it is agreed by the
parties that the Security Deposit will be released, without further notice to
the parties, by such third party to Landlord, and thereupon, Landlord will hold
same in accordance with this Section “27.” The initial deposit of the security
equals an aggregate of six (6) months Fixed Annual Rent. Tenant agrees that on
the fifth, tenth and fifteenth anniversary of the Commencement Date, the amount
of security shall increase so that the amount of the Security Deposit is the
equivalent of the aggregate of six (6) months of the then applicable Fixed
Annual Rent. The Security Deposit shall be held in an interest-bearing account
with interest accruing in favor of Tenant, and in accordance with the applicable
provisions of the New York General Obligations Law. Landlord shall direct the
institution holding the Security Deposit to pay Tenant annually the interest
accrued thereon. It is acknowledged and agreed to by the parties that the act of
the third party holding the Security Deposit as set forth above does not in any
way diminish or limit Landlord’s rights under this Lease to all or any portion
of the Security Deposit in the event of the occurrence of any circumstance
giving rise to Landlord’s right to apply the Security Deposit in accordance with
this Lease.
It
is agreed that in the event Tenant defaults in respect of any of the terms and
conditions of this Lease, and Tenant fails to cure such default within the
applicable grace period after notice, Landlord may use, apply or retain the
whole or any part of the Security Deposit to the extent required for the payment
of any rent or any other sum as to which Tenant is in default or for any sum
which Landlord may expend or may be required to expend by reason of Tenant’s
default in respect of any of the terms, covenants and conditions of this Lease.
If Landlord applies or retains any portion or all of the Security Deposit,
Tenant shall, within ten (10) business days after demand from Landlord, restore
the amount so applied so that at all times the Security Deposit shall remain the
same.
Upon
the expiration of this Lease and surrender of the Demised Premises to Landlord
in accordance with the terms of this Lease, the Security Deposit shall be
returned to Tenant after the date fixed as the end of the Lease and after
delivery of entire possession of the Demised Premises to Landlord, and after
completion and satisfactory review by Landlord of the Environmental Update (less
any amounts needed to cure any then existing Tenant defaults). In the event of a
sale of the Land or leasing of the Land of which the Demised Premises form a
part, Landlord will transfer the Security Deposit to the vendee or ground lessee
and Landlord shall thereupon be released by Tenant from all liability for the
return of such security and Tenant agrees to look to the new Landlord or ground
lessee solely for the return of the Security Deposit. The foregoing provisions
shall apply to every transfer or assignment made of the Security Deposit to a
new Landlord or ground lessee.
Tenant
covenants that it will not assign or encumber or attempt to assign or encumber
the Security Deposit and that neither Landlord nor its successors or assigns
shall be bound by any such assignment, encumbrance, attempted assignment or
attempted encumbrance.
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B. Tenant’s Option to
Post a Letter of Credit:
(a) In
lieu of cash, at Tenant’s option, upon thirty (30) days written notice to
Landlord, Tenant may deliver to Landlord, an Irrevocable Standby Letter of
Credit (“Letter of Credit”) which shall be (1) in the form attached hereto as
Exhibit “F”, (2) issued by a
bank reasonably acceptable to Landlord upon which presentment may be made in New
York City or Suffolk County, New York, (3) in an amount equal to the Security
Deposit, and (4) for a term of one (1) year, subject to extension in accordance
with the terms of the Letter of Credit. Tenant shall, on or before the date
thirty (30) days prior to the expiration of the term of such Letter of Credit,
deliver to Landlord a new Letter of Credit satisfying the foregoing conditions
(“Substitute Letter of Credit”) in lieu of the Letter of Credit then being held
by Landlord, or an amendment to the Letter of Credit extending the term thereof.
If the issuer of such Letter of Credit gives notice of its election not to renew
such Letter of Credit for any additional period pursuant to the last grammatical
paragraph thereof or otherwise, Tenant shall be required to deliver a Substitute
Letter of Credit satisfying the conditions hereof, on or before the date thirty
(30) days prior to the expiration of the term of such Letter of Credit. Tenant
agrees to maintain such Letter of Credit or Substitute Letter of Credit in
accordance with the requirements of this Section “27” throughout the Term. Upon
delivery of the Letter of Credit pursuant to this Section “27”, Landlord shall
contemporaneously return to Tenant the cash security previously
held.
(b) In
the event that a Tenant Event of Default shall have occurred and is continuing
beyond any applicable grace, notice or cure period, then Landlord shall have the
right, without giving any further notice to Tenant, (a) to draw down upon said
Letter(s) of Credit (Substitute Letter of Credit or Additional Letter(s) of
Credit, as defined below, as the case may be) in the amount necessary to cure
such Tenant Event of Default, or (b) if such Tenant Event of Default cannot
reasonably be cured by the expenditure of money, to exercise all rights and
remedies Landlord may have on account of such default and to reimburse itself
out of the Letter of Credit (Substitute Letter of Credit or Additional Letter(s)
of Credit, as the case may be), for all reasonable amounts expended by Landlord
in the exercise of such rights and remedies and any other amounts or sums
payable by Tenant to Landlord on account thereof. In the event of any such draw
by Landlord, Tenant shall, within fifteen (15) business days of written demand
therefor, deliver to Landlord an additional Letter of Credit in the form
required by Section “27.B(a)” hereof (“Additional Letter of Credit”), except
that the amount of such Additional Letter of Credit shall be the amount of such
draw. In addition, in the event of a termination of this Lease by Landlord as a
result of Tenant Event of Default or a rejection of this Lease pursuant to the
provisions of the Federal Bankruptcy Code, Landlord shall have the right to draw
upon the Letter of Credit and/or any Substitute Letter of Credit or Additional
Letter(s) of Credit (from time to time, if necessary) to cover the full amount
of damages and other amounts due from Tenant to Landlord under this Lease
without reference, if the same is applicable, to any limitation on such damages
and amounts that might otherwise be imposed by the Bankruptcy Code.
(c) In
the event that Tenant fails timely to deliver to Landlord a Substitute Letter of
Credit or Additional Letter of Credit as required in this Section “27.B”, then
Landlord shall have the right, at any time after five (5) days written notice
from Landlord to Tenant, which Landlord may give to Tenant at least fifteen (15)
days before the scheduled date of expiration of the Substitute Letter of Credit
or Additional Letter of Credit, without giving any further notice to Tenant, to
draw upon the Letter of Credit (or Substitute Letter of Credit and/or Additional
Letter(s) of Credit) and to hold the proceeds thereof (“Security Proceeds”) in a
segregated bank account in the name of the Landlord as security for Tenant’s
obligations under the Lease in accordance with the provisions of this Section
“27”. Notwithstanding anything to the contrary contained herein, Landlord’s
failure to provide Tenant with notice in accordance with this Section “27.B(c)”
shall not obviate Tenant from its responsibilities to maintain the Security
Deposit at all times during the Term, nor shall it prevent Landlord from drawing
on the Letter of Credit (or Substitute Letter of Credit and/or Additional
Letter(s) of Credit), it being understood that it is Tenant’s sole and absolute
responsibility to maintain the Security Deposit at all times during the
Term.
(d) To
the extent that Landlord has not previously drawn upon any Letter of Credit,
Substitute Letter of Credit, Additional Letter of Credit or Security Proceeds
(collectively “Collateral”) held by Landlord, and to the extent that no Tenant
Event of Default has occurred and is continuing as of the termination of the
Term, Landlord shall return such Collateral to Tenant.
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28. Use: Tenant shall have the right to use and occupy the
Demised Premises for medical laboratories, including medical testing, and
ancillary office, warehouse and distribution use and related activities and for
any other lawful purpose, at all times being in compliance with applicable laws,
including, without limitation, applicable zoning and land use laws, codes,
regulations, directives and orders. Tenant shall not at any time use or occupy,
or suffer or permit any person to use or occupy the Demised Premises, or do or
permit anything to be done in the Demised Premises, in violation of the
Certificate of Occupancy for Tenant’s permitted use. Landlord shall have no
liability or obligation whatsoever if the use set forth in this Lease is not
complied with and Tenant assumes all risks in such eventuality. Tenant agrees to
indemnify and hold Landlord harmless, to the fullest extent permitted by law,
from and against all suits, actions, legal or administrative proceedings,
claims, liabilities, fines, penalties, losses, injuries, damages, expenses or
costs, including reasonable attorneys’ fees, arising from any violation of
Tenant’s obligations set forth in the preceding sentence. Tenant shall not
knowingly suffer or permit the Demised Premises or any portion thereof to be
used by the public in such manner as might reasonably tend to impair title to
the Demised Premises or any portion thereof, or in such manner as might
reasonably make possible a claim or claims of adverse usage or adverse
possession by the public, as such, or of implied dedication of the Demised
Premises or any portion thereof.
29. Signs: Tenant shall have the right to install and maintain
at its own expense, signs provided the Tenant shall (i) comply with all of the
laws, orders, rules and regulations of the governmental authorities having
jurisdiction over the Demised Premises, including, but not limited to, zoning
laws, building codes and as required by insurance underwriters and (ii) obtain
Landlord’s prior written consent which shall not be unreasonably withheld or
delayed. The criteria for Landlord’s consent shall be limited to the potential
impact on the Building due to the attachment or installation of a sign. Tenant
shall obtain and pay for all permits required therefor. Tenant expressly agrees
that no sign shall be installed until all approvals and permits are first
obtained and copies thereof delivered to the Landlord with evidence of payment
of any fees pertaining thereto. Tenant agrees to pay all annual renewal fees, if
any, pertaining to Tenant’s signs.
30. Force Majeure: Neither Landlord nor Tenant shall have any
liability whatsoever to the other on account of the inability to timely fulfill
any of its obligations under this Lease by reason of any strike, lockout or
other labor trouble; inability to obtain labor, materials, coal, oil, or other
suitable fuel or reasonable substitutes therefor or the failure of the supply of
any thereof; acts of God, fire or other casualty; governmental preemption of
priorities or other controls in connection with a public emergency; governmental
restrictions or requirements of laws; enemy, terrorist or hostile governmental
action; civil commotion; or any other cause, whether similar or dissimilar to
the above, beyond the non-performing party’s reasonable control (the foregoing
events are collectively referred to as “Force Majeure”). If this Lease specifies
a time period for performance of an obligation of either party, that time period
shall be extended by the period of any delay in such party’s performance caused
by any of the events of Force Majeure. Notwithstanding anything to the contrary
contained herein, under no circumstances shall Tenant be entitled to claim or
benefit from this Force Majeure provision in relation to fulfilment of any
monetary obligation under this Lease, including, without limitation, payment of
rent, additional rent or other charges coming due under this
Lease.
-28-
31. Casualty Loss:
(a) If
during the Term fifty percent (50%) or more of the Improvements is destroyed or
rendered untenantable by fire or other casualties exclusive of Tenant’s
improvements not insured under Landlord’s insurance policy, Tenant shall
promptly notify Landlord of same within twenty-four (24) hours of such event.
Landlord shall assess the condition of the Demised Premises and the availability
of insurance proceeds necessary to rebuild the Demised Premises (exclusive of
Tenant’s improvements not insured under Landlord’s insurance policies). As
promptly as possible given delays beyond Landlord’s control, such as delays
caused by the insurers, Landlord shall notify Tenant in writing of the
anticipated time necessary to rebuild the Demised Premises, together with its
plans of construction. Tenant shall have thirty (30) days from Landlord’s notice
to determine whether to (i) remain under lease for the Demised Premises, in
which case Landlord shall rebuild the Demised Premises in accordance with its
plans, as soon as reasonably practicable, taking into account delay in receiving
insurance proceeds, or (ii) terminate this Lease thereupon the Term shall
terminate on such date which is thirty (30) days after the date of such notice,
and all rent and other payments, including, but not limited to, insurance
premiums, Taxes and assessments shall be. apportioned to the date of such
termination. If Tenant elects to terminate this Lease as aforesaid, then all
insurance proceeds available on account of such damage to the Building shall be
the sole property of Landlord and Tenant shall have no claim whatsoever with
regard thereto. Tenant shall retain proceeds, if any, relating to damage of
Tenant’s personal property. If Tenant fails to make such election, it shall be
deemed that Tenant has elected “(i)” hereof. If Tenant has elected “(i)” hereof,
then, during the time of re-construction of the Demised Premises, the rent
herein reserved and other charges including, but not limited to, Taxes and
insurance premiums, if any, payable hereunder, or a just and proportionate part
thereof, according to the nature and extent that the Demised Premises shall have
been rendered unfit for use and occupation, shall be suspended or abated until
the Demised Premises shall have been put in substantially the same condition in
which they were immediately prior to such destruction or damage.
(b) Notwithstanding
the foregoing, if an event of casualty occurs within the last two (2) lease
years of the Term which would otherwise be covered by subsection “(a)” above,
then either Landlord or Tenant, upon sixty (60) days written notice to the other
from the date Tenant notifies Landlord in writing of the event of casualty, may
elect to terminate this Lease, and all rent and other payments, including, but
not limited to, insurance premiums, Taxes and assessments shall be apportioned
to the date of such termination. In the case of an event of casualty falling
under this Section “31(b)”, Landlord will have no obligation to restore any part
of the Demised Premises so damaged.
(c) If
less than fifty percent (50%) of the Improvements is destroyed or rendered
untenantable by fire or other casualties exclusive of Tenant’s improvements not
insured under Landlord’s insurance policies, then this Lease will continue in
full force and effect, and Landlord shall proceed with reasonable diligence, as
soon as reasonably practicable, taking into account delay in receiving insurance
proceeds, to repair and restore the Improvements, excluding Tenant’s
improvements not covered by Landlord’s insurance, to substantially the same
condition in which they were immediately prior to such damage or destruction,
and the rent herein reserved and other charges including, but not limited to,
Taxes and insurance premiums, if any, payable hereunder, or a just and
proportionate part thereof, according to the nature and extent that the Demised
Premises shall have been rendered unfit for use and occupation, shall be
suspended or abated until the Demised Premises shall have been put in
substantially the same condition in which they were immediately prior to such
destruction or damage. Notwithstanding the foregoing, Landlord shall have no
obligation to restore the Demised Premises in the event of casualty under this
Section “31(c)” during the last two (2) years of the Term.
(d) In
determining what constitutes reasonable diligence within the meaning of this
Section “31”, consideration shall be given to delays caused by strike,
adjustment of insurance and other causes beyond the Landlord’s
control.
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(e) If
any dispute arises between the parties as to the extent of the damage referred
to in subsection “(a)” or (c)” hereof, or if there is a dispute as to what
constitutes a just and proportionate part of the rent as referred to in
subsection “(c)” hereof, and the parties are unable to agree thereon, a
determination shall be made by the disinterested appraiser agreed upon by the
parties. Such appraiser shall be one regularly engaged in the business of making
such appraisals of fire damage to industrial and commercial buildings. If the
parties are unable to agree upon the selection of one such appraiser, each party
shall appoint its own appraiser, who in turn shall appoint determination of the
majority shall be accepted by the parties as binding. Such appraisers shall be
appointed within twenty (20) days of the occurrence of the fire or other
casualty.
(f) This
Section “31” constitutes an express agreement governing damage or destruction of
the Demised Premises or the Improvements by fire or other casualty, and neither
Section 227 of the Real Property Law of the State of New York which provides for
such contingency in the absence of an express agreement, nor any other laws of
similar import now or hereafter in effect, shall have any application in any
such case.
32. Condemnation:
(a) If
all of the Demised Premises are taken by condemnation, sale in lieu of
condemnation, or in any other manner for any public or quasi-public use or
purpose (“Eminent Domain”) such that Tenant is materially prohibited from
conducting its business operations in the Demised Premises, this Lease and the
Term and estate hereby granted shall terminate as of the date of vesting of
title on such taking or the date that the condemning or purchasing authority
takes possession, whichever is earlier, and the rents shall be prorated and
adjusted as of such date.
(b) If
part of the Demised Premises is taken by Eminent Domain, this Lease shall be
unaffected by such taking, except that (a) the rent shall be reduced by an
amount equal to the rent attributable to the portion of the Demised Premises
taken, and (b) Landlord shall repair or restore the remaining portions of the
Demised Premises, with reasonable dispatch after collection of the award
attributable to the taking by Eminent Domain; provided, however, that Landlord
shall not be required to (i) make such repair or restoration if the event of
Eminent Domain occurs within the last eighteen (18) months of the Term, or (ii)
expend on such repair or restoration amounts in excess of the total awards (net
of the costs of collection) collected by it on account of the taking.
Notwithstanding the foregoing, if the portion of the Demised Premises taken by
Eminent Domain materially and adversely affects Tenant’s ability to conduct its
business in the Premises in Landlord’s reasonable judgement, then Tenant shall
have the right to terminate this Lease by giving Landlord notice thereof within
thirty (30) days after the date of vesting of title on such taking.
(c) Landlord
shall be entitled to receive the entire award or payment in connection with any
taking of the Demised Premises or any part thereof without deduction for any
estate vested in Tenant by this Lease, except that Tenant shall be entitled to
share in any award made to Landlord to the extent of the value of the trade
fixtures, machinery and equipment installed by and at the expense of Tenant, or
by any moving expenses therefor, but only if Tenant’s claim does not adversely
affect or result in any reduction of Landlord’s award or interfere with the
prosecution of a claim for the taking by Landlord.
(d) In
determining what constitutes reasonable dispatch within the meaning of this
Section “32”, consideration shall be given to delays caused by strike,
adjustment of insurance and other causes beyond the Landlord’s
control.
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33. Recording of Lease: Expressly to enable Tenant to procure
leasehold title insurance, Tenant may, at its sole cost and expense, record a
Memorandum of this Lease, provided it simultaneously execute a Termination of
Memorandum of Lease in recordable form together with any ancillary documents as
may be requested by the recording officer which will be held by Landlord to be
recorded upon the expiration or earlier termination of the Term in accordance
with the terms of this Lease. Landlord shall give Tenant seven (7) days written
notice prior to the recording of the Termination of Memorandum of Lease, except
in the case of a recording in connection with any court ordered termination of
this Lease or upon the Expiration Date, in which case Landlord may record the
Termination of Memorandum of Lease without any notice whatsoever to Tenant. For
purposes hereof, in the event of any permitted assignment of this Lease, it
shall be a condition to the effectiveness of such assignment that the assignee
submit to Landlord a written Termination of Memorandum of Lease in recordable
form in the same form as that originally executed by Tenant, together with any
ancillary documents as may be requested by the recording officer. Failure to
submit such Termination of Memorandum of Lease together with any ancillary
documents as may be requested by the recording officer by such permitted
assignee shall constitute a material breach of this Lease and an illegal and
improper assignment thereof. The parties agree that the Memorandum of Lease
shall specifically not identify the rental amounts to be paid by Tenant under
this Lease.
(a) Notwithstanding
any other provision of this Lease, except as set forth in this Section “34”,
Tenant shall not assign, mortgage, pledge or otherwise assign this Lease, in
whole or in part, or sublet all or any part of the Demised Premises or suffer or
permit the Demised Premises or any part thereof to be used or occupied by
others, whether voluntarily or not, without the prior written consent of
Landlord in each instance. Nothing in this Lease shall be deemed to permit
Tenant to collaterally assign, collaterally sublet or hypothecate its interest
in this Lease. Tenant may, from time to time, perfect fixture financing of its
personal property contained in the Lease provided under no circumstances shall
any filing be indexed or recorded against the Land, Improvements or the Demised
Premises. If such indexing or recording occurs, Tenant shall forthwith with all
diligence act to have same removed from the real property index or record, and
Tenant shall indemnify, defend and hold Landlord Indemnified Parties harmless on
account thereof, including, but not limited to, reasonable counsel fees and
disbursements.
(b) From
time to time, at the request of Landlord, any permitted assignee or subtenant
will furnish information reasonably requested by Landlord with regard to the
beneficial and record owners of the capital stock (or equity interest, as the
case may be) of such permitted assignee or subtenant. The foregoing sentence
does not apply to Tenant.
(c) Any
request submitted to Landlord for consent to an assignment or subletting shall
be accompanied by Tenant’s agreement to pay Landlord’s reasonable attorney’s
fees for reviewing the proposed assignment or sublease and the cost of the
credit check which sums shall constitute Additional Rent and by a check for $500
which constitutes a nonrefundable deposit toward such costs. Landlord shall have
no obligation to consider any request to sublet or assign if Tenant shall be in
default beyond any applicable notice or cure period under the terms and
conditions of this Lease.
(d) Landlord
shall not unreasonably withhold, condition or delay its consent to a proposed
assignment or subletting, however, Landlord shall consider the following and any
further or any other factors which Landlord deems relevant in determining
whether or not to consent to any assignment or subletting:
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(i)
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The
financial ability of the proposed assignee or subtenant as may be
reflected, in part, by financial statements submitted to Landlord and by a
credit check which shall be conducted by Landlord against the proposed
assignee or subtenant and the individual principals
thereof,
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(ii)
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The
past experience of the proposed assignee or subtenant and/or the
principals thereof in the operation of a business similar to the business
which they wish to conduct at the Demised Premises;
and
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(iii)
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Whether
any such assignment or sublet imposes any additional material obligations
on Landlord.
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(e) Provided
Landlord consents to a subletting or assignment an original draft of the fully
executed sublease or assignment shall be sent to Landlord at least ten (10)
business days prior to the effective date thereof, which sublease or assignment
shall contain an acknowledgment by the subtenant or assignee to the effect that
it has received a copy of this Lease and agrees to comply with and perform all
of the obligations of the Tenant thereunder to the extent
applicable.
(f) Following
a permitted assignment of this Lease, the assignee shall be deemed to be the
Tenant hereunder. However, it is understood that no assignment or sublease,
whether consented to by Landlord or not shall operate to relieve Tenant of
“tenant” obligations under this Lease.
(g) If
this Lease be assigned, or if the Demised Premises or any part thereof be sublet
or occupied by anybody other than Tenant without Landlord’s consent, Landlord
may, regardless of the occurrence of a default by Tenant, collect rent from the
assignee, subtenant or occupant, and apply the net amount collected to the rent
herein reserved, but no such assignment, subletting, occupancy or collection
shall be deemed a waiver of this Section, or the acceptance of the assignee,
subtenant or occupant as Tenant, or a release of Tenant from the further
performance by Tenant of covenants on the part of Tenant herein contained. Such
occurrence shall also be deemed a Tenant Event of Default if Tenant has not
cured such breach after seven (7) days notice from Landlord.
(h) The
consent by Landlord to an assignment or underletting shall not in any way be
construed to relieve Tenant from obtaining the express consent in writing of
Landlord to any further assignment or subletting requiring such consent, or
relieve Tenant from its primary liability to Landlord on account of this
Lease.
(i) The
provisions of this Section “34” concerning assignment and subletting shall apply
to any assignee, subtenant or anyone holding the Demised Premises through the
Tenant and must be complied with for each and every assignment and/or subletting
of all or any portion of the Demised Premises.
(j) The
prohibitions against assigning or subletting shall be construed to include a
prohibition against any assignment or subletting by operation of law, merger,
consolidation, reorganization, acquisition, transfer or other change of Tenant’s
(or any permitted assignee’s or sublessee’s) corporate or proprietary structure,
including a change in the partners of any partnership, and the sale, pledge, or
other transfer of any of the issued or outstanding capital stock of any
corporate tenant or permitted assignee or sublessee (unless such stock is
publicly traded on a recognized security exchange or over the counter market),
other than the following scenarios, in which case, assignment of this Lease or a
sublet of all or any portion of the Demised Premises will be permitted, to wit:
(i) an assignment of Tenant’s interest in this Lease and/or to a sublet of all
or any portion of the Demised Premises to an Affiliate of Tenant; (ii) a sale of
the entire or substantially the entire business of Tenant or its Affiliate
conducted at the Demised Premises or a sale of all or substantially all of
Tenant’s or its Affiliate’s assets; or (iii) in conjunction with any merger,
acquisition or consolidation involving Tenant or its Affiliate (so long as
Tenant’s or its Affiliate’s stock is publicly traded on a recognized security
exchange or over the counter market); provided, however, in subsections
“(i)-(iii)”, above, (x) Tenant is not in default under the terms of this Lease
beyond any applicable grace or cure period, (y) promptly after the effective
date of any such assignment or sublet, a fully executed and acknowledged
assignment or sublet agreement, in proper form, is delivered to Landlord, which
assignment shall contain an assumption agreement by assignee in favor of
Landlord for the terms and provisions of this Lease, and (z) Tenant shall remain
liable for all “Tenant” obligations under this Lease. For purposes hereof,
“Affiliate” shall mean a corporation which is controlling, controlled
by, or under common control with Tenant. As used herein, “control” shall mean
the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of an entity, whether through the
ownership of voting securities or rights, by contract or
otherwise.
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(k)
Each sublease shall
provide that it is subject and subordinate to this Lease and to the matters to
which this Lease is or shall be subordinate, and that, in the event of
termination, reentry or dispossession by Landlord under this Lease, Landlord
may, at its option, take over all the rights, title and interest of Tenant, as
sublessor under such sublease, and such subtenant shall, at Landlord’s option,
attorn to Landlord pursuant to the then executory provisions of such sublease,
and such subtenant shall promptly execute and deliver any instrument Landlord
may reasonably request to evidence such attornment except that Landlord shall
not (a) be liable for any previous act or omission of Tenant under such
sublease, (b) be subject to any offset, not expressly provided in such sublease,
which theretofore accrued, to such subtenant against Tenant, or (c) be bound by
any previous modification of such sublease or by any previous prepayment of more
than one month’s rent.
(l)
Every subletting
hereunder is subject to the express condition, and by accepting a sublease
hereunder each subtenant shall be conclusively deemed to have agreed, that if
this Lease should be terminated prior to the Expiration Date or if Landlord
should succeed to any portion of Tenant’s estate in the Demised Premises, then
at Landlord’s election, such subtenant shall surrender that portion of the
Demised Premises which it is subletting to Landlord within sixty (60) days of
Landlord’s request therefor.
35.
Bankruptcy:
(a)
Anything elsewhere
in this Lease to the contrary notwithstanding, this Lease may be canceled by
Landlord by sending a written notice to Tenant within a reasonable time after
the happening of any one or more of the following events: (1) the commencement
of a case in bankruptcy or under the laws of any state naming Tenant as the
debtor; or (2) the making by Tenant of an assignment or any other arrangement
for the benefit of creditors under any state statute. In the case of an
involuntary bankruptcy, Tenant shall have a period of ninety (90) days from
Landlord’s notice to cure such involuntary bankruptcy, provided Tenant is
otherwise not in default of this Lease beyond any applicable grace period,
including, without limitation, current on payments of rent and additional rent.
Neither Tenant nor any person claiming through or under Tenant, or by reason of
any statute or order of court, shall thereafter be entitled to possession of the
Demised Premises but shall forthwith quit and surrender the Demised Premises. If
this Lease shall be assigned in accordance with its terms, the provisions of
this Section shall be applicable only to the party then owning Tenant’s interest
in this Lease, it being understood, however, that Tenant shall remain liable
under this lease as per Section “34(t)”, above.
(b) It is stipulated
and agreed that in the event of the termination of this Lease pursuant to this
Section “35”, Landlord shall forthwith, notwithstanding any other provisions of
this Lease to the contrary, be entitled to recover from Tenant as and for
liquidated damages an amount equal to the difference between the rental reserved
hereunder for the unexpired portion of the Term and the fair and reasonable
rental value of the Demised Premises for the same period. In the computation of
such damages the difference between any installment of rent becoming due
hereunder after the date of termination and the fair and reasonable rental value
of the Demised Premises for the period for which such installment was payable
shall be discounted to the date of termination at the Prime Rate in effect on
the date of termination. If such premises or any part thereof be relet by the
Landlord for the unexpired term of said Lease, or any part thereof, before
presentation of proof of such liquidated damages to any court, commission or
tribunal, the amount of rent reserved upon such reletting shall be deemed to be
the fair and reasonable rental value for the part or the whole of the premises
so re-let during the term of the re-letting. Nothing herein contained shall
limit or prejudice the right of the Landlord to prove for and obtain as
liquidated damages by reason of such termination, an amount equal to the maximum
allowed by any statute or rule of law in effect at the time when, and governing
the proceedings in which, such damages are to be proved, whether or not such
amount be greater, equal to, or less than the amount of the difference referred
to above.
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(c)
If pursuant to the
Bankruptcy Code of 1978, as the same may be amended, Tenant is permitted to
assign this Lease in disregard of the restrictions contained in the provisions
hereof, Tenant agrees that adequate assurance of future performance by the
assignee permitted under such Code shall mean the deposit of cash security with
Landlord in an amount equal to the sum of the Annual Fixed Rent then reserved
hereunder plus an amount equal to all Additional Rent payable under this Lease
for the calendar year preceding the year in which such assignment is intended to
become effective, which deposit shall be held by Landlord, without interest, for
the balance of the Term as security for the full and faithful performance of all
of the obligations under this Lease on the part of Tenant yet to be performed.
If Tenant receives or is to receive any valuable consideration for such an
assignment of this Lease, such consideration, after deducting therefrom (a) the
brokerage commissions, if any, and other expenses reasonably incurred by Tenant
for such assignment and (b) any portion of such consideration reasonably
designated by the assignee as paid for the purchase of Tenant’s property in the
Demised Premises, shall be and become the sole and exclusive property of
Landlord and shall be paid over to Landlord directly by such assignee. In
addition, adequate assurance shall mean that any such assignee of this Lease
shall have a net worth, exclusive of goodwill, equal to at least ten (10) times
the aggregate of the Fixed Annual Rent reserved hereunder plus all Additional
Rent for the preceding calendar year as aforesaid. This shall be enforceable
provided that it does not result in the imposition of any personal liability
upon Tenant’s officers, directors or shareholders.
36.
Net
Lease: It is the intention of the Landlord and the
Tenant that the Fixed Annual Rent herein specified shall be net to the Landlord
in each Lease Year during the Term. Accordingly, except as otherwise provided in
this Lease, all costs, expenses, and obligations of every kind relating to the
Demised Premises, including, but not limited to, insurance, water and sewer
charges, utility charges, real property taxes or other taxes that may be imposed
that relate to the Demised Premises, repairs and all maintenance and
replacements, and all other operating expenses, (except as otherwise
specifically provided in this Lease) which may arise or become due during the
Term shall be paid by the Tenant to the Landlord as Additional Rent, and the
Landlord shall be indemnified by the Tenant against such costs, expenses, and
obligations.
37.
Default
by Tenant: If Tenant shall fail to pay any installment of Fixed
Annual Rent or Additional Rent on the day the same shall become due and payable
hereunder, and such failure shall continue for a period of five (5) business
days after notice thereof from Landlord, or if Tenant shall fail to keep and
perform promptly any other covenant of this Lease in accordance with the terms
of this Lease and such failure shall continue for a period of thirty (30) days
after notice thereof from Landlord (collectively “Tenant Event of Default”),
Landlord may serve a written three (3) days notice of cancellation of this Lease
upon Tenant, and upon the expiration of said three (3) days, this Lease and the
Term hereunder shall end and expire as fully and completely as if the expiration
of such three (3) day period were the day herein definitely fixed for the end
and expiration of this Lease and the Term hereof and Tenant shall then quit and
surrender the Demised Premises to Landlord but Tenant shall remain liable as
hereinafter provided, or Landlord may pursue any other available legal or
equitable remedy. For purposes hereof, the term Tenant Event of Default shall
also mean an “Event of Default” as that term is used under the Guaranty made by
Tenant’s parent, ICON plc, a copy of which is attached hereto as Exhibit “G”.
-34-
Upon occurrence of a Tenant Event of Default Landlord may, without further
notice, re-enter the Demised Premises and dispossess Tenant by summary
proceedings or other legal means, and the legal representative of Tenant or
other occupant of Demised Premises and remove their effects and hold the Demised
Premises as if this Lease had not been made, and Tenant hereby waives the
service of notice of intention to re-enter or to institute legal proceedings to
that end.
Notwithstanding
the foregoing, if Tenant cannot cure a non-monetary default with due diligence
prior to the expiration of thirty (30) days from the date of Tenant’s receipt of
the notice provided for above, and if Tenant commences within thirty (30) days
after Tenant’s receipt of the notice to eliminate the cause of such default and
proceeds diligently and with reasonable dispatch to take all steps and do all
work in order to cure such default, then Landlord shall not have the right to
exercise its remedies hereunder by reason of such default so long as said Tenant
Event of Default is completely cured within ninety (90) days. Thereafter,
Tenant’s failure to so remedy the nonmonetary default will be an Tenant Event of
Default under this Lease.
In
case of any Tenant Event of Default, re-entry, expiration and/or dispossession
by summary proceedings or otherwise, (a) the Fixed Annual Rent, and Additional
Rent, shall become due thereupon and be paid up to the time of such re-entry,
dispossession and/or expiration; (b) Landlord may re-rent the Demised Premises
or any part or parts thereof, either in the name of Landlord or otherwise, for a
term or terms, which may at Landlord’s option be less than or exceed the period
which would otherwise have constituted the balance of the Term and may grant
concessions or free rent or charge a higher rental than that in this Lease;
and/or (c) Tenant or the legal representatives of Tenant shall also pay Landlord
as liquidated damages for the failure of Tenant to observe and perform said
Tenant’s covenants herein contained, any deficiency between the rent hereby
reserved and/or covenanted to be paid and the net amount, if any, of the rents
collected on account of the subsequent lease or leases of the Demised Premises
for each month of the period which would otherwise have constituted the balance
of the Term. The failure of Landlord to re-let the Demised Premises or any part
or parts thereof shall not release or affect Tenant’s liability for damages. In
computing such liquidated damages there shall be added to the said deficiency
such reasonable expenses as Landlord may incur in connection with re-letting,
such as legal expenses, reasonable attorney’s fees, brokerage, advertising and
for keeping the Demised Premises in good order or for preparing the same for
re-letting. Any such liquidated damages shall be paid in monthly installments by
Tenant on the rent days specified in this Lease. Landlord, in putting the
Demised Premises in good order or preparing the same for re-rental may, at
Landlord’s option, make such alterations, repairs, replacements and/or
decorations in the Demised Premises as Landlord’s sole judgment, considers
advisable and necessary for the purpose of re-letting the Demised Premises, and
the making of such alterations, repairs, replacements, and/or decorations shall
not operate or be construed to release Tenant from liability. Landlord shall in
no event be liable in any way whatsoever for failure to re-let the Demised
Premises, or in the event that the Demised Premises are re-let, for failure to
collect the rent thereof under such re-letting, and in no event shall Tenant be
entitled to receive any excess, if any, of such net rent collected over the sums
payable by Tenant to Landlord hereunder.
Whether
or not Landlord shall have collected any monthly deficiency as aforesaid,
Landlord shall be entitled to recover from Tenant, and Tenant shall pay to
Landlord on demand in lieu of any further deficiency as and for liquidated
damages, a sum equal to the amount by which the rents for the period that
otherwise would have constituted the unexpired portion of the Term exceeds the
then fair market rental value of the Demised Premises for the same period (first
deducting from such fair market rental value all of Landlord’s reasonable
expenses in connection with the termination of this Lease, Landlord’s re-entry
upon the Demised Premises and reletting costs, if any, including all
repossession costs, brokerage commissions, attorney’s fees and disbursements,
alteration costs and other expenses of preparing the Premises for reletting, but
only to the extent such expenses have not already been paid to Landlord through
prior court proceedings or otherwise), both discounted to present value at the
rate of six percent (6%) per annum, less the aggregate amount of deficiencies
theretofore collected by Landlord for the same period; provided, however, that
if, before presentation of proof of such liquidated damages to any court,
commission or tribunal, the Demised Premises, or any part thereof, shall have
been relet by Landlord in an arms length transaction for the period that
otherwise would have constituted the unexpired portion of the Term, or any part
thereof, the amount of rent reserved upon such reletting shall be deemed, prima
facie, to be the fair market rental value for the part of the Demised Premises
so relet during the term of the reletting.
-35-
In
the event of a breach or threatened breach by Tenant of any of the covenants or
provisions hereof, Landlord shall have the right of injunction and the right to
invoke any remedy allowed at law or in equity as if re-entry, summary
proceedings and other remedies were not herein provided for. Mention in this
Lease of any particular remedy shall not preclude Landlord from any other
remedy, in law or in equity, Landlord’s choice of remedies being cumulative and
not exclusive. Tenant expressly waives any and all rights of redemption granted
by or under any present or future laws.
38.
Default
by Landlord: If any representation made by Landlord herein shall be
false, or if Landlord shall breach any warranty or fail to perform any covenant
that Landlord is required to perform and such breach or failure shall continue
for a period of thirty (30) days after Landlord receives notice thereof from
Tenant or if Landlord shall fail to pay any sums due to Tenant or any taxing
authority hereunder, and such failure shall continue for a period of ten (10)
days after Landlord receives notice thereof from Tenant (collectively, “Landlord
Event of Default”) then Tenant may, (i) exercise all available legal and
equitable rights and remedies, or (ii) cure any Landlord Event of Default and
perform any covenants which Landlord has failed to perform, and Landlord shall
pay to Tenant within two weeks after receipt of demand all reasonable sums which
Tenant expends in curing such default and performing such covenants and if such
sums are not timely paid Tenant may bring suit to recover from Landlord all sums
due Tenant from Landlord. Notwithstanding the foregoing, any nonmonetary default
cannot with due diligence be cured prior to the expiration of thirty (30) days
from the date of Landlord’s receipt of the notice provided for above, and if
Landlord commences within thirty (30) days after the date to eliminate the cause
of such default and proceeds diligently and with reasonable dispatch to take all
steps and do all work in order to cure such default, then Tenant shall not have
the right to declare this Lease terminated by reason of such
default.
39.
Right
To Cure Default: If Tenant defaults in the performance of any
covenants or obligations of the Lease to be performed by Tenant, Landlord may,
after expiration of any applicable cure period, or, if in Landlord’s opinion, an
emergency exists, perform the same without notice for the account and at the
expense of Tenant. If Landlord incurs any expense, including reasonable
attorney’s fees, in instituting, prosecuting or defending any action or
proceeding by reason of any default by Tenant, Tenant shall reimburse Landlord
the amount of such expense together with interest thereon at the Interest Rate.
If Landlord defaults in the performance of any covenants or obligations of the
Lease to be performed by Landlord, Tenant may, after fifteen (15) days written
notice, except in an emergency, then upon one (1) business day’s notice, perform
the same for the account and at the expense of Landlord.
40.
No
Set-Off, Rent Abatement, Consolidation or Counterclaim: The Tenant
shall not be entitled to any abatement of rent or rental value or diminution of
rent or damages in any proceedings brought by Landlord against Tenant. In any
action by the Landlord against Tenant the Tenant shall not have the right of
set-off, recoupment or counterclaim for any damages which the Tenant may have
sustained by reason of the Landlord’s failure to perform any of the terms,
covenants and conditions contained in this Lease or for any other cause. The
Tenant shall be relegated to an independent action for damages and such
independent action shall not at any time be consolidated with any action or
proceeding instituted by the Landlord. Tenant shall not interpose any
counterclaim (except a mandatory counterclaim) it may otherwise assert in any
summary proceeding whether such summary proceeding is based on nonpayment of
rents or on Tenant’s holding over after expiration of the Term or on any other
basis pursuant to Article 7 of the Real Property Actions and Proceedings Law of
the State of New York.
-36-
No
diminution or abatement of rent, or other compensation, shall be claimed or
allowed for inconvenience or discomfort arising from the making of repairs to
the Improvements. In respect to the services agreed to be furnished by Landlord
to Tenant, it is agreed that there shall be no diminution or abatement of the
rent, or any other compensation for interruption or curtailment of such service
when such interruption or curtailment shall be due to accident, alterations or
repairs necessary to be made or to the inability or difficulty in securing
supplies or labor for the maintenance of such service or to some other cause,
not negligence or wrongful acts on the part of Landlord. No such interruption or
curtailment of any such service shall be deemed a constructive eviction.
Landlord shall not be required to furnish, and Tenant shall not be entitled to
receive, any of such services during any period wherein Tenant shall be in
default in respect to the payment of rent. Neither shall there be any abatement
or diminution of rent because of making repairs to the Demised Premises after
the Commencement Date it being understood that the rent shall, in any event,
commence to run at such date so above fixed.
41.
Access
to Premises: Landlord and Landlord’s agents shall have the right (but
shall not be obligated) to enter the Demised Premises in an emergency at any
time, and, at other reasonable times, on reasonable notice, to examine the same
and to make such repairs, replacements and improvements which Landlord may elect
to perform in the Demised Premises after Tenant’s failure to make repairs or
perform any work which Tenant is obligated to perform under this Lease, or for
the purpose of complying with laws, regulations and other directions of
governmental authorities. Landlord may, during the progress of any work in the
Demised Premises, take all necessary materials and equipment into the Demised
Premises without the same constituting an eviction nor shall the Tenant be
entitled to any abatement of rent while such work is in progress nor to any
damages by reason of loss or interruption of business or otherwise.
Throughout
the Term, Landlord shall have the right to enter the Demised Premises at
reasonable hours and on reasonable advance notice for the purpose of showing the
same to prospective purchasers and Mortgagees and during the last six (6) months
of the Term for the purpose of showing the same to prospective
tenants.
42.
End of
Term: Upon the expiration or other termination of the Term, Tenant
shall quit and surrender to Landlord the Demised Premises and the Improvements
broom clean, free of rubbish and debris in good order and condition, ordinary
wear and damages which Tenant is not required to repair as provided elsewhere in
this Lease excepted, and Tenant shall remove all its property from the Demised
Premises. Landlord may consider items of Tenant’s property that remain in the
Demised Premises after the Expiration Date or earlier termination of the Term to
have been abandoned, and disposal of same shall be made at the sole costs and
expense of Tenant. If the last day of the Term or any renewal thereof falls on
Sunday, this Lease shall expire at noon on the preceding Saturday unless it be a
legal holiday in which case it shall expire at noon on the preceding business
day. Notwithstanding the foregoing, (a) in case of any termination or expiration
under Section “37”, Tenant shall remain liable as provided therein, and (b)
Tenant’s or Landlord’s accrued liability or obligations, as the case may be,
under this Lease shall in all events survive the expiration or earlier
termination of the Term. This Section “42” shall survive the Expiration Date or
earlier termination of this Lease.
43.
Adjacent Excavation: If an excavation shall be made upon
land adjacent to the Demised Premises, or shall be authorized to be made, Tenant
shall afford to the person causing or authorized to cause such excavation,
license to enter upon the Demised Premises for the purpose of doing such work as
said person shall deem necessary to preserve the wall or the building of which
Demised Premises form a part from injury or damage and to support the same by
proper foundations without any claim for damages or indemnity against Landlord,
or diminution or abatement of rent.
-37-
44.
Holdover: In the event Tenant remains in
possession of the Demised Premises after the termination or expiration of this
Lease, Tenant, at the option of Landlord, shall be deemed to be occupying the
Demised Premises as a tenant from month to month at a monthly rental equal to
two (2) times the Fixed Annual Rent and Additional Rent payable during the last
month of the Term subject to all of the other terms of this Lease insofar as the
same are applicable to a month-to-month tenancy. Nothing contained herein shall
be deemed an authorization for Tenant to hold over beyond the expiration of the
Term and no such holding over shall be an extension or renewal of this Lease.
Tenant waives any rights under Section 2201 of the Civil Practice Law and Rules
of the State of New York in connection with any holdover proceedings that
Landlord may institute against Tenant. This provision shall survive the
termination or expiration of this Lease.
45.
Right
of Redemption: Tenant hereby expressly waives any and all rights of
redemption granted by or under any present or future laws in the event of Tenant
being evicted or dispossessed for any cause, or in the event Landlord obtaining
possession of the Demised Premises, by reason of the violation by Tenant of any
of the covenants and conditions of this Lease, or otherwise.
46.
Event
of Vacatur: In the event Tenant shall vacate the Demised Premises or
cease doing business therein, Tenant shall nevertheless remain obligated to
perform all of its obligations set forth in this Lease, and in addition, shall
take such commercially reasonable and prudent measures to safeguard the Demised
Premises and all building systems contained therein in light of their reduced
usage. Such measures shall include, without limitation, security patrols and
sufficient running of HVAC systems to prevent unreasonable wear and tear from
heat during the summer months and cold during the winter months.
47.
Accord
And Satisfaction: No payment by Tenant or receipt by Landlord of a
lesser amount than the Fixed Annual Rent and Additional Rent Payable under this
Lease shall be deemed to be other than on account of the earliest payable Fixed
Annual Rent or Additional Rent, nor shall any endorsement or statement on any
check or any letter accompanying any check or payment as rent be deemed an
accord and satisfaction, and Landlord may accept such check or payment without
prejudice to Landlord’s right to recover the balance of such Fixed Annual Rent
or Additional Rent or pursue any other remedy provided in this Lease by
law.
48.
Disclaimer: Except as herein specifically
set forth, the Landlord shall not be liable or bound in any manner by express or
implied warranties, guarantees, promises, statements, representations or
information.
49.
Partial
Invalidity: If any term, covenant, condition or provision of this
Lease or the application thereof to any person or circumstance 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, covenant, condition and provision of this Lease shall be
valid and be enforced to the fullest extent permitted by law.
50.
Attorney’s Fees: In the event of any litigation regarding
the rights and obligations under this Lease, the prevailing party shall be
entitled to reasonable attorneys’ fees and court costs. The provisions of this
Section “50” shall also apply to the period prior to the Commencement Date.
Additionally, all reasonable costs and expenses, other than routine
administrative expenses, including attorneys’ fees (whether or not legal
proceedings are instituted), involved in collecting rents or enforcing the
obligations of Tenant under this Lease, including the cost and expense of
instituting and prosecuting legal proceedings or recovering possession of the
Demised Premises after breach by Tenant or upon expiration or earlier
termination of this Lease, to the extent such costs and expenses have not
already been paid as a deficiency or as liquidated damages under Section “37”,
above, shall be due and payable by Tenant as Additional Rent within twenty (20)
days of demand.
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51.
Non-Waiver: No written 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. Furthermore, Landlord’s
failure during the Lease Term to prepare and deliver to Tenant any statements or
bills, or Landlord’s failure to make a demand for Additional Rent, shall not in
any waive or cause Landlord to forfeit or surrender Landlord’s rights to collect
any item of Additional Rent which may have become due during the
Term.
52.
Lease
Not Binding Until Executed: Submission by Landlord of the within
Lease for execution by Tenant shall confer no rights nor impose any obligations
on either party unless and until both Landlord and Tenant shall have executed
this Lease and duplicate originals thereof shall have been delivered to the
respective parties or their attorneys.
53.
Indemnification: All provisions of this Lease calling
for one party to indemnify the other are limited by the condition that such
indemnification obligations are limited to the extent permitted by applicable
law. If the scope of any indemnification obligation contained in this Lease is
too broad to permit enforcement of such obligation to its full extent, then such
obligation shall be enforced to the maximum extent permitted by law, and the
parties hereby consent and agree that such scope may be judicially modified
accordingly in any proceeding brought to enforce such obligation.
54.
Entire
Agreement: This Lease embodies and constitutes the entire
understanding between the parties with respect to the transaction contemplated
herein, and all prior agreements, understandings, representations and
statements, oral or written, are merged into this Lease.
55.
Landlord Reservation of Rights: Any reservation of a
right by Landlord to enter upon the Demised Premises and to make or perform any
repairs, alterations, or other work in, to, or about the Demised Premises which,
in the first instance, is the Tenant’s obligation pursuant to the Lease, shall
not be deemed to:
(a) impose
any obligation on Landlord to do so;
(b) render
Landlord liable to Tenant or any third party for the failure to do so;
or
(c) relieve
Tenant from any obligation to indemnify Landlord as otherwise provided elsewhere
in the Lease.
56.
Notices: All notices shall be in writing signed by the
party serving the same and shall be sent by national “overnight” courier (i.e.,
next business day service) such as Federal Express with receipt, in any case,
where applicable, with fee prepaid, and addressed to the parties at the address
set forth in the Preamble of this Lease or to such other addresses as either
party may have furnished to the other from time to time as a place for the
service of notice. Any notice to be given to Landlord under the terms of this
Lease shall also be given to the Landlord’s property manager, Marcus Property
Management, Corp., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
Notices shall be deemed given when received or returned for inability to
deliver. Attorneys may send notices for their respective clients. Notices may
not be sent by facsimile or electronic medium, except for information purposes
only. Copies of such notices given by either party to the other shall be served
on their attorneys in the same format as set forth in this Section “56”.
Landlord’s attorney is Forchelli, Curto, Schwartz, Mineo, ▇▇▇▇▇▇▇ & ▇▇▇▇,
LLP, ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇ ▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Fax No.: (▇▇▇)
▇▇▇-▇▇▇▇, Attn: ▇▇▇▇▇ ▇. ▇▇▇▇, Esq. Tenant’s attorney is Westerman, Ball,
▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇, LLP, ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇, Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq. Notwithstanding
the foregoing, Landlord may send routine bills, invoices and notices by regular
mail.
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57.
Waiver
of Trial by Jury: Regardless of any law now or
hereafter enacted, the respective parties hereto shall and they hereby do waive
trial by jury in any action, proceeding, or counterclaim brought by either of
the parties hereto against the other on any matters whatsoever arising out of or
in any way connected with this Lease, the relationship of Landlord and Tenant,
Tenant’s use of or occupancy of the Demised Premises, and any emergency
statutory or any other statutory remedy.
58.
Tenant’s Right to Extend Term: Provided the Term has
not expired or been terminated and no Event of Default by Tenant has occurred
under this Lease and be continuing beyond the expiration of any applicable grace
or cure period set forth in this Lease as of the date of the Extension Notice
(as hereinafter defined) and as of the date of the commencement of the Extended
Term (as hereinafter defined), Tenant shall have the option to extend the Term
for one (1) period of ten (10) years (the “Extended Term”), commencing as of the
Expiration Date as originally scheduled under this Lease. If this Lease is so
extended, the new expiration date shall be hereafter referred to as the
“Extended Expiration Date.”
Tenant
may exercise its right of extension as set forth in this Section “58” by
providing to Landlord written notice on or before such date which is twenty four
(24) months prior to the scheduled date of expiration of the Term (the
“Extension Notice”), Time Being of the Essence as against Tenant. The failure of
Tenant to timely deliver the Extension Notice as herein above set forth shall be
deemed to be Tenant’s complete and unequivocal waiver of any right of Tenant to
extend the Term.
The
Fixed Annual Rent for the first Lease Year of the Extended Term shall be
determined as follows:
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(a)
For purposes hereof, the term “Consumer Price Index” shall mean the
Consumer Price Index for All Urban Consumers published by the Bureau of
Labor Statistics of the United States Department of Labor, New York, N.Y.
- Northeastern N.J. Area, All Items (1982-84 = 100), or any successor or
substitute index thereto, appropriately adjusted; provided that if there
shall be no successor index and the parties shall fail to agree upon a
substitute index within thirty (30) days, or if the parties shall fail to
agree upon the appropriate adjustment of such successor or substitute
index within thirty (30) days, a substitute index or the appropriate
adjustment of such successor or substitute index, as the case may be,
shall be determined by arbitration, the cost of which shall be borne
equally by the parties. The parties shall then use the following
formula:
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Consumer
Price Index in effect in the month of the original Expiration Date divided
by the Consumer Price Index in effect on the Commencement Date, times the
Fixed Annual Rent paid in the initial Lease Year of the Term, the result
of which shall be multiplied by 95%.
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So,
for example, assuming the Consumer Price Index on the original Expiration
Date is 283.0, and the Consumer Price Index in effect in the month of the
Commencement Date is 193.0, the Fixed Annual Rent would be determined as
follows:
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| 283.0 = 193.0 = 1.466 (rounded to nearest hundredth) X 2,025,750 = 2,970,400 X 95% = $2,821,880.00 | ||
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(b) Notwithstanding
anything to the contrary contained herein, in no event, however, shall the
Fixed Annual Rent for the first Lease Year of the Extended Term be less
than the Fixed Annual Rent in effect for the last Lease Year of the Term
prior to the commencement of the Extended Term.
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(c) The
above result in Section “(a)” shall be limited not to exceed an amount
equal to the Fixed Annual Rent from the first initial Lease Year of the
Lease increased by 4% per year until the first Lease Year of the Extended
Term.
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(d) Once
determined in accordance with subparagraph “(a)” above, the Fixed Annual
Rent during the Extended Term shall increase at the rate of 2.5% for each
and every Lease Year of the Extended
Term.
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A.
Successors: The
terms, conditions and covenants of this Lease shall be binding upon and shall
inure to the benefit of each of the parties, their heirs, personal
representatives, administrators, successors and to the extent permitted hereby
their assigns.
B.
Modifications:
Neither this Lease nor any provision hereof may be modified, amended, discharged
or terminated except by an instrument signed by the party against whom the
enforcement of such waiver, modification, amendment, discharge or termination is
sought, and then only to the extent set forth in such instrument. The parties
agree to enter into any amendments to this Lease that are reasonably requested
to correct errors or otherwise achieve the intentions of the parties
hereto.
C.
Construction: The
captions appearing in this Lease are inserted only as a matter of convenience
and in no way define, limit, construe or describe the scope or intent of such
Sections of this Lease or in any way affect this Lease. Any gender used shall be
deemed to refer to any other gender more grammatically applicable to the party
to whom such use of gender relates. The use of singular shall be deemed to
include the plural and, conversely, the plural shall be deemed to include the
singular. If more than one person and/or entity comprises the landlord under
this Lease, the term “Landlord” shall include all persons and/or entities
comprising landlord, jointly and severally.
D.
Negotiation of Lease:
The parties hereto agree that each party and their respective counsel have
reviewed and revised this Lease and that the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of this Lease or any amendments, exhibits
or schedules hereto.
E.
Survival: All
obligations under this Lease which have not been fully performed by the
expiration or termination of this Lease shall survive the expiration or
termination of this Lease.
F.
Governing Law: (a)
This Lease shall be governed by, and be construed in accordance with, the laws
of the State of New York without regard to the principles of conflicts of laws.
To the fullest extent permitted by law, Tenant hereby unconditionally and
irrevocably waives any claims to assert that the law of any other jurisdiction
governs this Lease and agrees that this Lease shall be governed by and construed
in accordance with the laws of the State of New York pursuant to Section 5-1401
of the New York General Obligations Law.
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(b) Any
legal suit, action or proceeding against Tenant or Landlord arising out of or
relating to this Lease may be instituted in any federal or state court in
Suffolk County, New York, pursuant to Section 5-1402 of the New York General
Obligations Law, and Tenant hereby waives any objection which it may now or
hereafter have to the laying of venue of any such suit, action or proceeding
including, without limitation, any claim of forum non conveniens pursuant to any
rule of common law and/or any applicable federal or state statute, law or
provision, and Tenant hereby irrevocably submits to the jurisdiction of any such
court in any suit, action or proceeding.
G.
Exhibits: All
exhibits, schedules and riders appended to this Lease are incorporated herein
and by this reference made a part hereof References to “Exhibits” or “Schedules”
shall be to Exhibits and Schedules attached to this Lease except where the
context requires otherwise.
60. Definitions: The term “Landlord” as used in this
Lease means only the owner of the fee or of the leasehold or the mortgagee in
possession, for the time being of the Land or the owner of a lease of the Land,
so that in the event of any sale or sales of said Land, or in the event of a
lease of the Land, the said Landlord shall be and hereby is entirely freed and
relieved of all covenants and obligations of Landlord arising thereafter, and it
shall be deemed and construed without further agreement between the parties or
their successors in interest, or between the parties and the purchaser, at any
such sale, or the said lessee of the Land, that the purchaser or the lessee has
assumed and agreed to carry out any and all covenants and obligations of
Landlord hereunder. The words “re-enter” and “re-entry” as used in this Lease
are not restricted to their technical legal meaning. The term “rent” or “Rent”
includes the Fixed Annual Rent whether so-expressed or expressed in monthly
installments, and “additional rent.” “Additional rent” means all sums which
shall be due to new Landlord from Tenant under this Lease, in addition to the
Fixed Annual Rate. The term “business days” as used in this lease, shall exclude
Saturdays, Sundays and all days observed by the State or Federal Government as
legal holidays. The term “lease year” or “Lease Year” means each anniversary of
the Commencement Date.
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IN WITNESS WHEREOF, the
parties hereto have executed this Lease effective on the date last written
below.
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Exhibit
“A” - Demised Premises
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Exhibit
“B” - Survey
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Exhibit
“C” - Building Work
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Exhibit
“D” - Design and Construction Schedule
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Exhibit
“E” - Form of Non-Disturbance Agreement
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Exhibit
“F” - Letter of Credit
Exhibit “G”- Guaranty |
[SIGNATURES
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