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STANDARD FORM OF STORE LEASE
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The Real Estate Board of New York, Inc.
AGREEMENT OF LEASE, made as of this 29th day of January, 1996, between
THE SOHO HOTEL COMPANY, L.P. a Delaware limited partnership having an address at
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, party of the firs party,
hereinafter referred to as "OWNER" or "LANDLORD". and ▇▇▇▇▇ ▇▇▇▇▇▇, INC., a
Delaware corporation having an address at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇, party of the second part, hereinafter referred to as TENANT.
WITNESSETH, Owner hereby leases to Tenant and Tenant hereby hires from
Owner those premises (the "demised premises" or "Demised Premises") located on
the ground floor and lower level indicated on Exhibit A attached hereto and made
a part hereof, in the building known as ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ in the Borough of
Manhattan, City of New York, at the annual rental and for the term set forth in
Article 40 hereof.
The parties hereto, for themselves, their heirs, distributees,
executors, administrators, legal representatives, successors and assigns, hereby
covenant as follows:
Rent 1. Tenant shall pay the rent as above and as hereinafter provided.
Occupancy 2. Tenant shall use and occupy demised premises as set forth in
Article 44 below and for no other purpose. Tenant shall at all times conduct its
business in a high grade and reputable manner, shall not violate Article 37
hereof, and shall keep windows and signs in a neat and clean condition.
Alterations:
3. (INSERT 1)
Repairs:
4. (INSERT 2) If Owner allows Tenant to erect on the outside of the building a
sign or signs, or a hoist, lift or sidewalk elevator for the exclusive use of
Tenant, Tenant shall maintain such exterior installations in good appearance and
shall cause the same to be operated in a good and workmanlike manner and shall
make all repairs thereto necessary to keep same good order and condition, at
Tenant's own cost and expense, and shall cause the same to be covered by the
insurance provided for hereafter in Article 8. (INSERT 3) (INSERT 4) Except as
specifically provided in Article 9 or elsewhere in this leas, there shall be no
allowance to the Tenant for the diminution of rental value and no liability on
the part of Owner by reason of inconvenience, annoyance or injury to business
arising from Owner, Tenant or others making or failing to make any repairs,
alterations, additions or improvements in or to any portion of the building
including the erection or operation of any ▇▇▇▇▇, ▇▇▇▇▇▇▇ or sidewalk shed, or
in or to the demised premises or the fixtures, appurtenances or equipment
thereof. The provisions of this article 4 with respect to the making of repairs
shall not apply in the case of fire or other casualty which are dealt with in
article 9 hereof.
Window Cleaning:
5. Tenant will not clean nor require, permit, suffer or allow any window in the
demised premises to be cleaned from the outside in violation of Section 202 of
the New York State Labor Law or any other applicable law of the Rules of the
Board of Standards and Appeals, or of any other Board or body having or
asserting jurisdiction.
Requirements of Law, Fire Insurance:
6. Prior to the commencement of the lease term, if Tenant is then in possession,
and at all times thereafter, Tenant at Tenant's sole cost and expense, shall
promptly comply with all present and future laws,
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INSERTS TO PAGE 1
1. (a) Tenant shall make no changes in or to the demised premises of any
nature without Owner's prior written approval in each instance, except
as otherwise expressly permitted in this lease.
(b) Only with Landlord's prior written approval in each instance (which
approval shall not be unreasonably withheld, delayed or conditioned),
Tenant may, from time to time during the term of this lease, at its
sole expense, make alterations, additions, installations, substitutions
and improvements in and to the interior of the demised premises that
are not structural in nature, that do not result in, or require, an
amendment to, or modification of, the certificate of occupancy for the
Building, and that do not otherwise adversely affect the structural
parts or integrity of the Building and do not adversely affect any of
the Building's utilities, systems or services (other than those that
exclusively serve the demised premises) (such alterations, additions,
installations, substitutions and improvements being hereinafter
referred to as "Nonstructural Changes"), as Tenant may consider
necessary or desirable for the conduct of its business therein, on the
following conditions:
(i) the outside appearance or structural integrity of the
Building shall not be affected;
(ii) no part of the Building outside of the demised premises
shall be altered, modified, or changed and no work will be performed
thereon; and
(iii) the proper functioning of any of the mechanical,
electrical, sanitary and other service systems of the Building that
serve portions of the Building other than the demised premises, shall
not be adversely affected, and the usage of such systems by Tenant
shall not be materially increased.
For the purposes of this Article, a "Decorative Change" shall mean a
Nonstructural Change that is entirely decorative in nature and does not
require the approval of any governmental or quasi-governmental
authority (other than the New York City Landmarks Preservation
Commission). Owner's approval shall be deemed given for all Decorative
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Changes and Permitted Nonstructural Changes (as defined in subsection
(f)(i) below), provided that, for each Decorative Change or Permitted
Nonstructural Change the estimated cost of which is $25,000.00 (or
more), at least ten (10) days prior to commencing any such Decorative
Change or Permitted Nonstructural Change, Tenant gives to Owner a
notice of Tenant's intention to perform such Decorative Change(s) or
Permitted Nonstructural Change(s), which notice, to be effective, shall
be accompanied by a reasonably detailed description of the Decorative
Change(s) or Permitted Nonstructural Change(s) that Tenant intends to
perform, the estimated commencement date and completion date of such
Decorative Change(s) or Permitted Nonstructural Change(s), and the
estimated cost thereof.
(c) Tenant shall not make any alterations, additions, installations,
substitutions, improvements or decorations (i) outside the demised
premises; (ii) in or to the exterior of the demised premises; (iii) in
or to the interior of the demised premises that are structural in
nature or that otherwise affect the structural integrity or parts of
the Building or that adversely affect any of the Building's utilities,
systems or services that serve portions of the Building other than the
demised premises, or (iv) which result in, or require, an amendment to,
or modification of, the certificate of occupancy for the Building (such
alterations, additions, installations, substitutions, improvements and
decorations being hereinafter referred to as "Structural Changes"),
without Owner's prior written approval in each instance, which approval
may be withheld by Owner in its absolute and sole discretion.
(d) Nonstructural Changes and/or Structural Changes (collectively,
"Changes" and individually, a "Change") shall only be performed in
accordance with and subject to, this Article and the other applicable
provisions of this lease.
(e) Before commencing any Change (except for Permitted Nonstructural
Changes and Decorative Changes), Tenant, at its sole cost and expense,
shall prepare and submit to Owner for Owner's approval, reasonably
detailed plans and specifications therefor, which approval shall not be
unreasonably withheld, delayed or conditioned for any Nonstructural
Changes or Required Structural Changes (as defined in Article 6 below),
that are described therein. If Owner fails to respond to Tenant's
request for approval of any plans or specification (or revisions
thereto) within ten
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(10) business days after Owner's receipt thereof, same shall be deemed
approved. The cost and expense reasonably paid by Owner in connection
with the review of said plans and specifications (and all revisions
thereto), and the inspection of the work in respect thereof, by Owner's
architects, engineers and other consultants and professionals (such
cost and expense being hereinafter referred to as the "Review and
Inspection Cost") shall be reimbursed by Tenant to Owner (as Additional
Rent) within thirty (30) days after Owner's demand therefor, which
demand shall be accompanied by reasonably detailed invoices therefor.
Notwithstanding the preceding sentence, Tenant shall not be obligated
to pay any of the Review and Inspection Cost directly related to the
Tenant's Work (as defined in Section 49.03 below), and the Review and
Inspection Cost for all other Changes shall not exceed, for each
submission of plans and specifications (including up to three (3) minor
revisions thereto), $2,000.00 through the period ending on the fifth
(5th) anniversary of the date next preceding the Commencement Date,
$2,500.00 for the next five (5) period ending on the tenth (10th)
anniversary of the date next preceding the Commencement Date, $3,000.00
for the next five (5) period ending on the fifteenth (15th) anniversary
of the date next preceding the Commencement Date, and $3,500.00 for the
next five (5) period (if any) ending on the twentieth (20th)
anniversary of the date next preceding the Commencement Date. Such
limitations on the Review and Inspection Cost payable by Tenant as
provided herein shall apply separately to each submission of plans and
specifications and shall include up to three (3) minor revisions
thereto. Tenant hereby agrees that neither Owner's approval of plans or
specifications, nor its inspection of such work, nor its right to
inspect such work, shall impose upon Owner any obligation or liability
whatsoever with respect thereto, including, without limitation, any
obligation or liability that might arise as a result of such work not
being performed in accordance with applicable laws and requirements or
with the plans and specifications approved by Owner or otherwise. Owner
may, as a condition of its approval, require Tenant to make revisions
in and to the plans and specifications, and, if (i) the aggregate cost
of the Changes for which Tenant is seeking approval, together with the
cost of all other Changes (including Decorative Changes) not then
completed and fully paid for, exceeds $100,000.00, and (ii) the named
Tenant or a Related Entity (as defined in Section 61.15 below) is not
the then Tenant under this lease, to post a
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bond or other security reasonably satisfactory to Owner to insure the
completion and payment of the Changes in question. To the extent that
any Changes modify or otherwise change facts that would be revealed on
"as-built" plans and specifications for the Demised premises, Tenant,
at Tenant's sole cost and expense, shall promptly after the substantial
completion of each such Change revise the Demised premises' "as-built"
plans and specifications and deliver same to Owner.
(f) (i) For the purposes of this Article, a "Permitted
Nonstructural Change" shall mean a Nonstructural Change (including a
Decorative Change) that is not part of Tenant's Work, the cost of
which, together with the cost of all other Changes that have not been
completed and fully paid for, equals (or is less than) $100,000.00, and
"MEP Changes" shall mean all portions of any Changes that relate to or
affect the Building's or the demised premises' mechanical (including
heating, ventilation and air-conditioning systems), electrical or
plumbing systems, all of the foregoing systems being herein
collectively referred to as the "MEP Systems." For the purposes of
determining whether a Change can be classified as a "Permitted
Nonstructural Change," Changes that are to be performed in stages or in
phases, but are part of the same project, shall be deemed one (1)
Change.
(ii) With respect to the Tenant's Work:
(A) Tenant shall not (1) use, employ or
retain a general contractor or construction manager, or (2) use, employ
or retain (or permit the use, employment or retention of) any mechanic,
supplier, materialman or subcontractor for any MEP Changes that relate
to or affect the MEP Systems that are entirely within the demised
premises or for any other Structural Changes, that has not been first
approved by Owner in writing, which approval shall not be unreasonably
withheld, delayed or conditioned, Owner hereby agreeing that the fact
that the contractor, mechanic, supplier, materialman or subcontractor
in question is so-called "non-union" shall not be, by itself, a reason
to withhold such approval;
(B) For the MEP Changes that relate to or
affect the MEP Systems that are outside the demised premises
(regardless of whether or not such MEP Systems only service the demised
premises), (1) Tenant shall use, employ and
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retain, as a construction manager, the construction manager used by
Owner for work being performed on behalf of Owner in or to the
Building, provided that the fee charged by such construction manager is
no more than five (5%) percent of the cost of the work in question, and
(2) Tenant shall use, employ and retain one (1) or more of the
subcontractors, suppliers, materialmen and mechanics set forth on the
list to be furnished to Landlord by Tenant, to the extent Landlord (in
its sole, but good faith, discretion) has approved such list in
writing; and
(C) For all Nonstructural Changes (including
Decorative Changes), Owner's approval shall not be required for the
subcontractors, suppliers, materialmen or mechanics used, employed or
retained by Tenant or Tenant's general contractor or construction
manager.
(iii) With respect to all Changes after the
substantial completion of all Tenant's Work:
(A) Tenant shall not (1) use, employ or
retain a general contractor or construction manager for a Nonstructural
Change that is not a Permitted Nonstructural Change, or (2) use, employ
or retain (or permit the use, employment or retention of) any mechanic,
supplier, materialman or subcontractor for an MEP Change that relates
to or affects an individual MEP System that is entirely within the
demised premises and that costs, by itself, more than $25,000.00, or
for any other Structural Changes, that has not (with respect to both
clauses (1) and (2) of this subsection (A)) been first approved by
Owner in writing, which approval shall not be unreasonably withheld,
delayed or conditioned, Owner hereby agreeing that the fact that the
contractor, mechanic, supplier, materialman or subcontractor in
question is so-called "non-union" shall not be, by itself, a reason to
withhold such approval;
(B) For all Nonstructural Changes (including
Decorative Changes), Owner's approval shall not be required for the
subcontractors, suppliers, materialmen or mechanics used, employed or
retained by Tenant or Tenant's general contractor.
(g) Before commencing any Change, Tenant shall, at its
expense, obtain all permits, notices, approvals and certificates
required by all governmental and quasi-governmental authorities
(including, without limitation, the
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Landmark's Preservation Commission) for the commencement and
prosecution of such Changes, and, upon completion, for the final
approval of such Changes, and shall cause Tenant's Changes to be
performed in compliance therewith, as well as with all applicable laws
and requirements of public authorities and all applicable requirements
of insurance bodies, in a good and workmanlike manner, using new or
"like new" materials and equipment. Provided that Tenant is
substantially and materially observing, performing and complying with
all of the terms, covenants and conditions in this lease with respect
to Changes, Owner, at no cost or expense to Owner (other than de
minimus cost and expense) shall cooperate with Tenant in obtaining such
permits, notices, approvals and certificates. Copies of all such
permits, notices, approvals and certificates shall be delivered to
Owner before commencing such Changes, and upon the completion thereof,
as the case may be.
(h) Throughout the performance of all Changes, Tenant shall,
at its expense, carry, or cause to be carried, worker's compensation
insurance in statutory limits and general liability insurance and
personal and property damage insurance for any occurrence in or about
the Building as set forth in Article 47 of this lease, as well as
Owner's Protective Insurance, and Builder's Risk Insurance, in
commercially reasonable coverage limits, as Owner may reasonably
require. All such insurance policies shall name Owner and all agents of
Owner, holders of superior mortgages and lessors under superior leases
whose names have been furnished to Tenant, as parties insured. Tenant
shall furnish Owner with satisfactory evidence that such insurance is
in effect before the commencement of any Changes and, on request, at
reasonable intervals thereafter during the continuance of the Changes.
If any Changes shall involve the removal of any fixtures, equipment, or
other property in the demised premises, such fixtures, equipment, or
other property shall be promptly replaced (if appropriate), at Tenant's
expense, with fixtures, equipment, or other property (as the case may
be) of like utility and at least equal quality.
(i) Tenant shall use reasonable efforts to perform all Changes
(and to have all Changes performed) so as to minimize interference with
the use and operation of the balance of the Building, including,
without limitation, the performance of work thereto by or on behalf of
Landlord or any tenant or occupant thereof.
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(j) (i) Owner and Tenant hereby acknowledge that Owner may be
entitled to certain historic tax credits under the Internal Revenue
Code and the regulations promulgated thereunder. In connection
therewith, Owner and Tenant agree that in performing any Changes
(including Tenant's Work) only the following events (individually, an
"Historic Event") will be subject to the review process described
below:
(A) Tenant utilizing more than 25% of the floor area
of the ground floor and cellar portions of the
demised premises for storage, offices and/or dressing
rooms;
(B) Tenant covering or concealing any existing
columns, column capitals or cased beams, except to
the extent that Tenant's mechanical or utility
systems will cross same, in which event Tenant may
(without said review process) lower the ceiling and
cover or conceal said columns, column capitals and/or
cased beams to the extent necessary to accommodate
such systems and to maintain consistency of Tenant's
architectural design;
(C) Tenant altering or covering the existing window
▇▇▇▇▇ or window moldings; and/or
(D) Tenant not concealing any existing exposed brick,
it being the agreement of the parties that except to
the extent otherwise expressly provided in this
paragraph (j), (1) Tenant, at Tenant's expense, and
as part of Tenant's Work, shall conceal all existing
exposed brick in all portions of the demised premises
(other than the subcellar portion of the demised
premises), (2) Tenant shall permit Owner, at Owner's
expense, to conceal all existing exposed brick in the
subcellar portion of the demised premises, but with
no obligation on the part of Owner to do so, and (3)
Tenant shall at all times during the term of this
lease keep concealed all existing exposed brick in
all portions of the demised premises, except in those
portions of the subcellar portion thereof that Owner
does not so coneal.
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(As used herein, the phrase "existing" shall refer to a condition that
exists on the Substantial Completion Date of this lease).
(ii) If any proposed Change will result in one or more
Historic Events, then Tenant shall submit a reasonably detailed
description of the the portion of the Change in question to the
historic preservation consultant designated by Owner, who initially
shall be ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ (the "Historic Consultant"). The Historic
Consultant shall, within the time periods set forth below and using its
reasonable professional judgment, determine (with absolutely no
recourse, warranty or representation) whether it is likely that the
Historic Event(s) in question will result in a loss or denial (in whole
or in part) of any said historic tax credits. If the determination is
that no such loss or denial is likely, then Tenant may perform the
Change in question as first proposed by Tenant, subject, however, to
all of the other provisions of this Article 3. If the determination is
that such a loss or denial is likely, then the Historic Consultant
shall provide a reasonably detailed explanation therefor and, in
cooperation with Tenant and Tenant's architect, and within ten (10)
days of such determination, redesign the Historic Event in a manner
that (A) will achieve substantially and materially the same
construction and aesthetic objectives of Tenant, at the same or lesser
cost and within the same or shorter time frames, and (B) is acceptable
to Tenant, it its reasonable discretion.
(iii) The time periods for the Historic Consultant's aforesaid
determination shall be as follows, commencing as of the Historic
Consultant's receipt of Tenant's description: (A) if the Historic Event
is part of Tenant's Work, then the time period shall be five (5)
business days, and (B) if the Historic Event is not part of Tenant's
Work, then the time period shall be ten (10) business days.
(iv) In the event the aforesaid time period is not satisfied
or the redesign does not satisfy either or both of the aforesaid
criteria, or if the Historic Consultant fails or refuses to make such
determination, Tenant shall be permitted to perform the Change in
question, subject, however, to all of the other provisions of this
Article 3, regardless of its effect on Owner's historic tax credits.
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(v) In the event that any historic tax credit be lost or
denied by the Internal Revenue Service as a result of an Historic
Event, despite the Historic Consultant's determination that such loss
or denial was not likely, Tenant shall not be required to modify the
Historic Event in question unless, to the reasonable satisfaction of
Tenant, (A) Owner agrees to compensate Tenant for all costs and
expenses associated with such modification, and (B) such modification
achieves the same construction and aesthetic objectives of Tenant, with
a time frame reasonably acceptable to Tenant.
(vi) Owner shall cause the Historic Consultant to be available
at all reasonable times at Tenant's request to advise on matters
relating to Historic Events. Furthermore, Owner shall pay for all fees,
costs and expenses of the Historic Consultant and for all reasonable
fees, costs and expenses of Tenant's architect, to the extent such
architect's fees, costs and expenses are for revising the plans and
specifications initially proposed by Tenant to reflect the Historic
Consultant's suggestions.
(vii) For the purposes of this paragraph (j), "demised
premises" shall be deemed to include the vault space which Tenant is
permitted to use and occupy pursuant to Article 14 below, and all other
space in the Building in or to which Tenant is permitted, pursuant to
this lease or any other agreement, to use, occupy or perform Changes or
other work.
(viii) Tenant acknowledges that the primary purpose of this
paragraph (j) is to attempt to preserve Owner's historic tax credit,
and, therefore, Owner, at any time, may elect not to require Tenant's
cooperation or the redesign of an Historic Event or the revisions to
the plans and specifications initially proposed by Tenant, as provided
for in this paragraph (j), or to discontinue such cooperation, redesign
or revisions. In such event, Owner shall be obligated to reimburse
Tenant for the reasonable fees, costs and expenses of Tenant's
architect for revising the plans and specifications initially proposed
by Tenant to reflect the Historic Consultant's suggestions, as provided
for in subparagraph (vi) above, to the extent incurred or paid.
(ix) Owner agrees that in connection with Owner's approval
rights for Changes pursuant to any other provision of this Article 3 or
any other provision of this lease or
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the letter agreement referred to in Article 9 below, Owner shall not
take into account said historic tax credits, Owner's only rights with
respect to historic tax credits being those which are expressly set
forth in this paragraph (j). Owner acknowledges that Tenant shall have
no liability whatsoever to Owner or any other person or entity as to
whether or not Owner obtains the benefit of any historic tax credit
(including, without limitation, any denial or reduction of said
historic tax credit).
2. (a) Subject to the provisions of Article 9 below, and except as
otherwise expressly provided in Article 6 below, Owner shall maintain
and repair in first-class condition and in compliance with any
applicable Legal and Insurance Requirements (or cause the maintenance
and repair) of all structural portions of the Building (both interior
and exterior) (including the roof, floor slabs and all structural
members of the Building), the Building's facade (excluding the demised
premises' glass storefront windows) and the sidewalks immediately in
front of the Building, except that such maintenance and repair
obligation with respect to the portions of the Building outside the
demised premises, the Building's facade and said sidewalks shall be
limited to maintenance and repairs that are necessary to avoid any
material and adverse interference with Tenant's use and occupancy of,
and access to and from, the demised premises for the purposes expressly
permitted under this lease. Owner shall also comply with (or cause the
compliance with) all of the repair and maintenance obligations
described in the special permit and Declaration (as modified) described
in Section 44.04 below), except for repairs and maintenance to the
demised premises' storefront windows and for repairs and maintenance
which are the expressed obligation of Tenant under this lease.
Notwithstanding anything contained in this lease which is, or may be
deemed, to the contrary, (i) Tenant, as Additional Rent and within
thirty (30) days after Owner's demand therefor, shall reimburse Owner
for the cost and expense reasonably incurred by Owner (subject to the
provisions of Article 48 below) to repair damage to any of the
structural portions of the Building, the Building's facade or said
sidewalks caused by the acts or omissions (other than ordinary use) of
Tenant or any person or entity claiming by, through or under Tenant,
and (ii) Owner shall have no obligation to maintain, repair or replace
any Tenant's Work, Tenant's Property or Changes (as such terms are
herein
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defined), including, without limitation, signs, or damage caused
by the performance or installation thereof.
3. and Article 47
4. (b) Except as otherwise expressly provided in Section 4(a) above,
Tenant, at Tenant's sole cost and expense, shall take good care of all
portions of the demised premises, all Tenant's Work, Tenant's Property
and Changes, and all fixtures and equipment (including all machinery,
wires, pipes and conduits) that service the demised premises
exclusively, whether located in or outside the demised premises, and
shall maintain all of the foregoing, and make all repairs thereto and
replacements thereof, necessary to keep the demised premises and all of
such fixtures and equipment in good working order and condition,
reasonable wear and tear, obsolescence and damage from the elements,
fire and casualty, condemnation, and the negligence or intentionally
wrongful acts or omissions of Owner, or Owner's agents, employees or
directors excepted. Any such damage caused by the negligence or
intentionally wrongful acts or omissions of Owner, or Owner's agents,
employees or directors shall (subject to the provisions of Article 48
below) be repaired by Owner.
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orders and regulations of all state, federal, municipal and local governments,
departments, commissions and boards and any direction of any public officer
pursuant to law, and all orders, rules and regulations of the New York Board of
Fire Underwriters or the Insurance Services Office, or any similar body which
shall impose any violation, order or duty upon Owner or Tenant with respect to
the demised premise, whether or not arising out of Tenant's use or manner of use
thereof, or with respect to the building if arising out of Tenant's use or
manner of use of the premises or the building (including the use under the
lease). Tenant shall not do or permit any act or thing to be done in or to the
demised premises which is contrary to law, or which will invalidate or be in
conflict with public liability, fire or other policies of insurance at any time
carried by or for the benefit of Owner, Tenant shall pay all costs, expenses,
fines, penalties or damages, which may be imposed upon Owner by reason of
Tenant's failure to comply with the provisions of this article. If the fire
insurance rate shall, at the beginning of the lease or at any time thereafter,
be higher than it otherwise would. be (INSERT 1) then Tenant shall reimburse
Owner, as additional rent hereunder, for that portion of all fire insurance
premiums thereafter paid by Owner which shall have been charged because of such
failure by Tenant, to comply with the terms of this article (INSERT 2) In any
action or preceding wherein Owner and Tenant are parties, a schedule or
"make-up" of rate for the building or demised premises issued by a body making
fire insurance rates applicable to said premises shall be conclusive evidence of
the facts therein stated and of the several items and charges in the fire
insurance rate then applicable to said premises. (INSERT 3)
Sub-ordinance:
7. This lease is subject and subordinate to all ground or underlying leases and
to all 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
underlying leases and mortgages. This clause shall be selfoperative and no
further instrument of subordination shall be required by any ground or
underlying lessor or by any mortgage, affecting any lease or the real property
of which the demised premises are a part. In confirmation of such subordination.
Tenant shall execute promptly any (INSERT 4) certificate that Owner may request.
Tenants Liability Insurance Property Loss, Damage, Indemnity:
8. Owner or its agents shall not be liable for any damage to property of Tenant
or of others (INSERT 5) to employees of the building, nor for loss of or damage
to any property of Tenant by theft or otherwise, nor for any injury or damage to
persons or property resulting from any cause of whatsoever nature, unless caused
by or due to the (INSERT 6) negligence of Owner, its agents, servants or
employees. Owner or its agents will not be liable for any such damage caused by
other tenants or persons in, upon or about said building or caused (INSERT 7) by
operations in construction of any private, public or quasi public work. Tenant
agrees, at Tenant's sole cost and expense, to maintain general public liability
insurance in standard form in favor of Owner and Tenant against claims for
bodily injury or death or property damage occurring in or upon the demised
premises, effective from the date Tenant enters into possession and during the
term of this lease, (INSERT 8) Tenant shall indemnify and save harmless Owner
against and from all liabilities, obligations, damages, penalties, claims, costs
and expenses for which Owner shall not be reimbursed by insurance, including
reasonable attorneys fees, paid, suffered or incurred as a result of any breach
by Tenant, Tenant's agent, contractors, employees, invitees or licensees, of any
covenant on condition of this lease, or the carelessness, (INSERT 6) negligence
or improper conduct of the Tenant, Tenant's agents, contractors, employees,
invitees or licensees. Tenant's liability under this lease extends to the acts
and omissions of any subtenant, and any agent, contractor, employee, invitee or
licensee of any subtenant. In case any action or proceeding is brought against
Owner by reason of any such claim, Tenant, upon written notice from Owner, will,
at Tenant's expense, resist or defend such action or proceeding by Counsel
approved by Owner in writing, such approval not to be unreasonably withheld,
(INSERT 9)
Destruction, Fire and Other Casualty:
9. (a) If the demised premises or any part thereof shall be damaged by fire or
other casualty, Tenant shall give immediate notice thereof to Owner and this
lease shall continue in full force and effect except as hereinafter set forth.
(b) If the demised premises are partially damaged or rendered partially unusable
by fire or other casualty, the damages thereto shall be repaired by and at the
expense of Owner and the rent, until such repair shall be substantially
completed, shall be apportioned from the day following the casualty according to
the part of the premises which is usable. (c) If the demised premises are
totally (INSERT 10) damaged or rendered wholly unusable by fire or other
casualty, then the rent shall be proportionately paid up to the time of the
casualty and thenceforth shall cease until the date when the premises shall have
been repaired and restored by the Owner, subject to Owner's right to elect not
to restore the same as hereinafter provided. (INSERT 11) (d) If the demised
premises are rendered wholly (INSERT 10) unusable or (whether or not the demised
premises are damaged in whole or in part) if (INSERT 12) Owner shall decided to
demolish it or to rebuild it, then, in any of such events, Owner may elect to
terminate this lease by written notice to Tenant given within 90 days after such
fire or casualty specifying a date for the expiration of the lease, which date
shall not be made more than 60 days after the giving of such notice, and upon
the date specified in such notice the term of this lease shall expire as fully
and completely as if such date were the date set forth above for the termination
of this lease and Tenant shall forthwith quit, surrender and vacate the premises
without prejudice however, to Owner's rights and remedies against Tenant under
the lease provisions in effect prior to such termination, and any rent owing
shall be paid up to such date and any payments of rent made by Tenant which were
on account of any period subsequent to such date shall be returned to Tenant.
Unless Owner shall serve a termination notice as provided for herein, Owner
shall make the repairs and restorations under the conditions of (b) and (c)
hereof, with all reasonable expedition subject to delays due to adjustment of
insurance claims, labor troubles and causes beyond Owner's control. After any
such casualty, Tenant shall cooperate with Owner's restoration by removing from
the premises as promptly as reasonably possible, all of Tenant's salvageable
inventory and movable equipment, furniture, and other property. Tenant's
liability for rent shall resume five (5) days after written notice from Owner
that the premises are substantially ready for Tenant's occupancy. (INSERT 13)
(e) Nothing contained hereinabove shall relieve Tenant from liability that may
exist as a result of damage from fire or other casualty. Notwithstanding the
foregoing, each party shall look first to any insurance in its favor before
making any claim against the other party for recovery for loss or damage
resulting from fire or other casualty, and to the extent that such insurance is
in force and collectible and to the extent permitted by law, Owner and Tenant
each hereby releases and waives all right of recovery against the other or any
one claiming through or under each of them by way of subrogation or otherwise.
The foregoing release and waiver shall be in force only if both releasers'
insurance policies contain a clause providing that such a release or waiver
shall not invalidate the insurance and also, provided that such a policy can be
obtained without additional premiums. Tenant acknowledges that Owner will not
carry insurance on Tenant's furniture and/or furnishings or any fixtures or
equipment, improvements, or appurtenances removable by Tenant and agrees that
Owner will not be obligated to repair any damage thereto or replace the same.
(f) Tenant hereby waives the provisions of Section 227 of the Real Property Law
and agrees that that provisions of this article shall govern and control in lieu
thereof. (INSERT 14)
Eminent Domain:
10.
Assignment, Mortgage, Etc.:
11. Tenant, for itself, its heirs, distributees, executors, administrators,
legal representatives, successors and assigns expressly covenants that it shall
not assign, mortgage or encumber this agreement, nor underlet, or suffer or
permit the demised premises or any part thereof to be used by others, without
the prior written consent of Owner in each instance (INSERT 15). If this lease
be assigned, or if the demised premises or any part thereof be underlet or
occupied by anybody other than Tenant, Owner may, after default by Tenant
(INSERT 16) collect rent from the assignee, under tenant or occupant, and apply
the net amount collected to the rent herein reserved, but no such assignment,
underletting, occupancy or collection shall be deemed a waiver of the covenant,
or the acceptance of the assignee, under tenant or occupant as tenant, or a
release of Tenant from the further performance by Tenant of covenants on the
part of the Tenant herein contained. The consent by Owner to an assignment or
underletting shall not in any wise be construed to relieve Tenant from obtaining
the express consent in writing of Owner to any further assignment or
underletting.
Electric Current:
12. Tenant covenants and agrees that at all times its use of electric current
shall not exceed the capacity of existing feeders to the building or the risers
or wiring installation and Tenant may not use any electrical equipment which, in
Owner's opinion, reasonably exercised, will overload such installation or
interfere with the use thereof by other Tenants of the building. The change at
any time of the character of electric service shall in no wise make Owner liable
or responsible to Tenant, for any loss, damages or expenses which Tenant may
sustain.
Access to Premises:
13. Owner or Owner's agents shall have the right (but shall not be obligated) to
enter the demised premises in any emergency at any time, and, at other
reasonable times, (INSERT 17) to examine the same and to make such repairs,
replacements and improvements (INSERT 18) following 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. (INSERT 19) Tenant shall permit Owner to
use and maintain and replace pipes and conduits in and through the demised
premises and to erect new pipes and conduits therein, provided they are within
the walls. Owner may, during the progress of any work in the demised premises,
take all necessary materials and equipment into said premises without the same
constituting an eviction nor shall the Tenant be entitled to any abatement of
rent while such work is in progress nor to any damages by reason of loss or
interruption of business or otherwise. Throughout the term hereof Owner shall
have the
2
INSERTS TO PAGE 2
1. due to the manner of use of any portion of the demised premises by
Tenant or any person or entity claiming by, through or under Tenant, or
due to a default under any of the terms, covenants or conditions of
this lease on Tenant's part to observe, perform or comply with or under
any consent or approval given to Tenant pursuant to this lease,
2. or as a result of such manner of use or default, provided Owner
furnishes Tenant with evidence from Owner's insurance carrier, broker
or agent of such increase in insurance premium.
3. (a) For the purposes of this Article 6, a Structural Change,
or a repair, that involves primarily a change, alteration, addition,
installation, substitution, improvement and/or repair of or to a
structural portion of, or materially affects the structural integrity
of, the Building (including the demised premises), is hereinafter
referred to as a "Limited Structural Change/Repair." Notwithstanding
anything contained in Article 6 or in any other provisions of this
lease which is, or may be deemed, to the contrary, (a) Tenant hereby
acknowledges that neither Landlord, nor any person or entity on behalf
of Landlord, has made any representation or warranty as to whether the
demised premises or the Building comply with any of the laws, orders,
regulation, directions, rules or regulations (collectively, "Legal and
Insurance Requirements") described in the first sentence of Article 6
above, including, without limitation, the Americans with Disabilities
Act and all laws relating to Hazardous Materials (as defined in Article
67 below), and (b) Tenant agrees that within the demised premises
(including from the top of the structural floor slab, to the underside
of the structural ceiling slab, and from the inside of all walls, and
the entire entry into the demised premises), Tenant, at Tenant's sole
cost and expense, shall be responsible for the compliance with all
Legal and Insurance Requirements, regardless of whether the compliance
involves or requires a Structural Change (a Structural Change that is
required to be performed to comply with a Legal and Insurance
Requirement being herein referred to as a "Required Structural
Change"), a Nonstructural Change or any type of repair, and regardless
of whether the Legal and Insurance Requirement is now in effect or
becomes
1
effective any time hereafter during the term of this lease, except that
Tenant shall not be required to make any Limited Structural
Change/Repair that is necessary to comply with a Legal and Insurance
Requirement, except to the extent that Tenant (or any person claiming
by, through or under Tenant) by its manner of use of the demised
premises or method of operation therein, violated a Legal and Insurance
Requirement.
(b) Owner shall comply with (or cause the compliance with) all
Legal and Insurance Requirements that directly relate to the public
portions of the Building and all other portions of the Building that
Owner is expressly (under this lease) required to maintain and repair,
to the extent the compliance therewith is necessary to avoid any
material and adverse interference with Tenant's use and occupancy of,
and access to and from, the demised premises for the purposes expressly
permitted under this lease, and shall comply with all Legal and
Insurance Requirements that require a Limited Structural Change/Repair
in or to the demised premises, except for a Limited Structural
Change/Repair that Landlord is not required to make pursuant to
subsection (a) above. In addition, and notwithstanding anything
contained in subsection (a) above to the contrary, Tenant shall not be
obligated to cure any violations that are not caused by the acts or
omissions of Tenant or any person or entity claiming by, through or
under Tenant. Promptly after Owner's receipt of any notice of violation
of any of the Legal and Insurance Requirements with which Owner is
expressly under this Article 6 obligated to comply, Owner shall send a
copy of such notice to Tenant.
4. reasonable
5. who claim to have entrusted such property
6. intentionally wrongful act, default or
7. by other tenants or persons
8. as more particularly required under Article 47 below.
9. , Owner hereby approving counsel selected by Tenant's insurance
carrier.
10. or substantially
2
11. For the purposes of Sections (b) and (c) of this Article 9, Owner shall
have no obligation to repair or restore any Tenant's Work, Tenant's
Property or Changes, Landlord's repair obligation being limited to
repairing to the condition of the Building on the date of this lease,
as improved by the Landlord's Work.
12. 50% or more of the rentable area of the Building is damaged or
destroyed and
13. If any of the events described in this Section (d) occur and Owner does
not elect to terminate this lease as provided in this Section (d), then
within such 90 day period, Owner shall deliver to Tenant a statement
from a contractor, construction manager, architect or engineer,
reasonably selected by (but not an employee of) Landlord, that sets
forth such contractor's, construction manager's, architect's or
engineer's good faith estimate as to when the repairs described in
Section (b) above will be substantially complete. Such statement shall
be without any representation or warranty on the part of, or recourse
against, Owner or the person or entity that actually gives such
statement. Notwithstanding anything contained in this Article 9 to the
contrary, (x) if such contractor, construction manager, architect or
engineer estimates that the repairs described in Section (b) above will
be substantially complete more than one (1) year after the date of the
fire or other casualty, or (y) if such contractor, construction
manager, architect or engineer estimates that such repairs will be
substantially complete within one (1) year after the date of the fire
or other casualty, but such repairs have not actually been completed
within one (1) year after the date of the fire or other casualty (which
one (1) year period shall be extended by one (1) day (up to an
additional ninety (90) days) for each day that Owner is delayed in
substantially completing such repairs for any of the reasons described
in Article 26 below), or (z) if any of the events described in this
Section (d) occur during the last eighteen (18) months of the term of
this lease (as such term may have been extended), then Tenant, as
Tenant's sole right and remedy, may elect to terminate this lease by
written notice to Landlord given within thirty (30) days after the date
Tenant receives the statement described in clause (x) above, or within
thirty (30) days after the expiration of the one (1) year period
described in clause (y) above (as such one (1) year period may be
extended as
3
set forth in clause (y) above), or within thirty (30) days after the
fire or other casualty if same occurs during the last eighteen (18)
months of the term of this lease (as such term may have been extended),
TIME BEING OF THE ESSENCE WITH RESPECT TO ALL OF SUCH DATES, in which
event, the term of this lease shall expire as fully and completely on
the date which is thirty (30) days after the date on which Tenant gives
Landlord such notice, as if such date were the Expiration Date and
Tenant shall forthwith quit, surrender and vacate the demised premises
in accordance with the applicable provisions of this lease, without
prejudice, however, to the obligations and liabilities of Landlord and
Tenant which accrued through such date, and any Fixed Rental or
Additional Rent owing shall be paid up to such date and any payments of
Fixed Rental or Additional Rent made by Tenant which were on account of
any period subsequent to such date shall be returned to Tenant.
Notwithstanding anything to the contrary contained in this lease, if
the lease is terminated pursuant to this Article 9, then Tenant shall
be deemed to have irrevocably waived all unpaid portions of the
Overtime Credit Amount, the Inventory Credit Amount, the HVAC
Reimbursement and the Self-Help Reimbursement Cost (as such terms are
hereinafter defined), and the Relocation Cost, the Reimbursement Cost,
the Transportation Cost and the Employee Cost (as such terms are
defined in that certain letter agreement of even date herewith between
Owner and Tenant with respect to a portion of the subcellar of the
Building) (and all accrued and unpaid interest thereon (if any)), but
not the "cost of completing the Landlord's Work (as such term is
defined in subsection 49.01(c) below), and Landlord shall be deemed to
have irrevocably waived the right to recover all overpayments of the
Overtime Credit Amount and the Inventory Credit Amount. If Tenant fails
to give Landlord such notice in the manner and in the time period set
forth above, then Tenant's right to terminate this lease shall be null
and void, and of no further force or effect, and this lease shall
continue in full force and effect, subject to the other provisions of
this lease.
14. In addition, Owner shall not carry insurance on, and shall not be
obligated or required to repair or rebuild, any of Tenant's Work,
Tenant's Property or Changes.
15. , as more particularly set forth in Article 61 below
16. , and after the giving of any required notice and the expiration of
any required cure period,
4
17. upon reasonable prior oral or written notice to Tenant or to the
manager or assistant manager of the demised premises,
18. which Owner, or any person or entity claiming by, through or under
Owner, may be required or obligated to make under this lease or
pursuant to applicable laws, or which Tenant is obligated to make under
this lease or pursuant to applicable laws
19. Notwithstanding the foregoing, and except in an emergency (in which
case, only reasonable (oral or written) notice under the circumstances
shall be required), Owner shall not make any repairs, replacements, or
improvements that Tenant fails to make unless (a) Owner has given
Tenant the required notice for such default, and (b) the applicable
cure period has expired.
5
right (INSERT 1) to enter demised premises at reasonable hours for the purpose
of showing the same to prospective purchasers or mortgages of the building, and
during the last six months of the term for the purpose of showing the same to
prospective tenants and may, during said six months period, place upon the
premises the usual notice "To Let" and "For Sale" which notices Tenant shall
permit to remain thereon without molestation. If Tenant is not present to open
and permit an entry into the premises, Owner or Owner's agents may enter the
same whenever such entry may be necessary (INSERT 2) by master key or forcibly
and provided reasonable care is exercised to safeguard Tenant's property and
such entry shall not render Owner or its agents liable therefor, nor in any
event shall the obligations of Tenant hereunder be affected.
Vault, Vault Space, Area:
14. No vaults, vault space or area, whether or not enclosed or covered, not
within the property line of the building is leased hereunder, anything contained
in or indicated on any sketch, blue print or plan, or anything contained
elsewhere in this lease to the contrary notwithstanding. Owner makes no
representation as to the location of the property line of the building. All
vaults and vault space and all such areas not within the property line of the
building, which Tenant may be permitted to use and/or occupy, is to be used
and/or occupied under a revocable license, and if any such license be revoked,
or if the amount of such space or area be diminished or required by any federal,
state or municipal authority or public utility, Owner shall not be subject to
any liability nor shall Tenant be entitled to any compensation or diminution or
abatement of rent, nor shall such revocation, diminution or requisition be
deemed constructive or actual eviction. Any tax, fee or charge of municipal
authorities for such vault or area shall be paid by Tenant. (INSERT 2A)
Occupancy:
15. Tenant will not at any time use or occupy the demised premises in violation
of, Articles 2 or 37 hereof, or of, the certificate of occupancy issued for the
building of which the demised premises are a part.
Bankruptcy:
16. (a) Anything elsewhere in this lease to the contrary notwithstanding, this
lease may be canceled by Landlord by the sending of 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 (INSERT 3) as the debtor (INSERT 4) or (2) the making by
Tenant (INSERT 5) of an assignment or any other arrangement for the benefit of
creditors under any state statute. Neither Tenant nor any person claiming
through or under Tenant, or by reason of any statute or order of court, shall
thereafter be entitled to possession of the premises demised but shall forthwith
quit and surrender the premises. If this lease shall be assigned in accordance
with its terms, the provisions of this Article 16 shall be applicable only to
the party then owning Tenant's interest in this lease.
(b) It is stipulated and agreed that in the event of the termination of
this lease pursuant to (a) hereof, Owner shall forthwith, notwithstanding any
other provisions of this lease to the contrary, be entitled to recover from
Tenant as and for liquidated damages an amount equal to the difference between
the rent reserved hereunder for the unexpired portion of the term demised and
the fair and reasonable rental value of the demise 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
installment was payable shall be discounted to the date of termination at the
rate of four percent (4%) per annum. If such premises or any part thereof be
relet by the Owner for the unexpired term of said lease, or any part thereof,
before presentation of proof of such liquidated damages to any court, commission
or tribunal, the amount of rent reserved upon such reletting shall be deemed to
be the fair and reasonable rental value for the part or the whole of the
premises so relet during the term of reletting. Nothing herein contained shall
limit or prejudice the right of the Owner 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.
Default:
17. (1) If Tenant defaults in fulfilling any of the covenants of this lease
other or if the demised premises become vacant or deserted; or if any execution
or attachment shall be issued against Tenant or any of Tenant's property
whereupon the demised premises shall be taken or occupied by someone other than
Tenant: or if this lease be rejected under Section 365 of Title 11 of the U.S.
Code (Bankruptcy Code); then, (INSERT 6) in any one or more of such events, upon
Owner serving (INSERT 7) the nature of said default and upon the expiration of
said (INSERT 8), if Tenant shall have failed to comply with or remedy such
default, or if the (INSERT 9) complained of shall be of a nature that the same
cannot be completely cured or remedied within said (INSERT 10) day period, and
if Tenant shall not have diligently commenced curing such default within such
(INSERT 10) day period, and shall not thereafter with reasonable diligence and
in good faith proceed to remedy or cure such default, then Owner may serve a
written (INSERT 11) days notice of cancellation of this lease upon Tenant, and
upon the expiration of said (INSERT 11) days, this lease and the term thereunder
shall end and expire as fully and completely as if the expiration of such
(INSERT 11) day period were the day herein definitely fixed for the end and
expiration of this lease and the term thereof and Tenant shall then quit and
surrender the demised premises to Owner but Tenant shall remain liable as
hereinafter provided. (2) If the notice provided for in (1) hereof shall have
been given, and the term shall expire as aforesaid; then and in any of such
events Owner may without notice (INSERT 12) re-enter the demised premises
(INSERT 13), and disposes Tenant by summary proceedings or otherwise, and the
legal representative of Tenant or other occupant of demised premises and remove
their effects and hold the premises as if this lease had not been made, and
Tenant hereby waives the service of notice of intention to re-enter or to
institute legal proceedings to that end.
Remedies of Owner and Waiver of Redemption:
18. In case of any such default, re-entry, expiration and/or dispossess by
summary proceedings or otherwise, (a) the rent, and additional rent, shall
become due thereupon and be paid up to the time of such reentry, dispossess
and/or expiration. (b) Owner may relet the premises or any part or parts
thereof, either in the name of Owner or otherwise, for a term or terms, which
may at Owner's option be less than or exceed the period which would otherwise
have constituted the balance of the term of this lease and may grant concessions
or free rent or charge a higher rental than that in this lease, and/or (c)
Tenant or the legal representatives of Tenant shall also pay Owner as liquidated
damages for the failure of Tenant to observe and perform said Tenant's covenants
herein contained, any deficiency between the rent hereby reserved and/or
covenanted to be paid and the net amount, if any, of the rents collected on
account of the subsequent lease or leases of the demised premises for each month
of the period which would otherwise have constituted the balance of the term of
this lease. The failure of the Owner to relet the premises or any part or parts
thereof shall not release or affect Tenant's liability for damages. In computing
such liquidated damages there shall be added to the said deficiency such (INSERT
14) expenses as Owner may incur in connection with reletting such as legal
expenses, attorneys' fees, brokerage, advertising and for keeping the demised
premises in good order or for preparing the same for reletting. Any such
liquidated damages shall be paid in monthly installments by Tenant on the rent
day specified in this lease. Owner, in putting the demised premises in good
order or preparing the same for re-rental may, at Owner's option, make such
alterations, repairs, replacements, and/or decorations in the demised premises
as Owner, in Owner's sole judgment, considers advisable and necessary for the
purpose of reletting 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. Owner shall in no event be liable in any way
whatsoever for failure to relet the demised premises, or in the event that the
demised premises are relet, for failure to collect the rent thereof under such
reletting, 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 Owner
hereunder. In the event of a breach or threatened breach by Tenant or any of the
covenants or provisions hereof, Owner shall have the right of injunction and the
right to invoke any remedy allowed at law or in equity as if re-entry, summary
proceedings and other remedies were not herein provided for. Mention in this
lease of any particular remedy, shall not preclude Owner (INSERT 15) from any
other remedy, in law or in equity. Tenant hereby expressly waives any and all
rights of redemption granted by or under any present or future laws. (INSERT 16)
Fees and Expenses:
19. If Tenant shall default in the observance or performance of any term or
covenant on Tenant's part to be observed or performed under or by virtue of any
of the terms or provisions in any article of this lease, then, unless otherwise
provided elsewhere in this lease, Owner may immediately or at any time
thereafter and without notice (INSERT 17) perform the obligations of Tenant
thereunder, and if Owner in connection therewith or in connection with any
default by Tenant in the covenant to pay rent hereunder, makes any expenditures
or incurs any obligations for the payment of money, including but not limited to
(INSERT 14) attorney's fees, in instituting, prosecuting or defending any
actions or proceeding, such sums so paid or obligations incurred with interest
and costs shall be deemed to be additional rent hereunder and shall be paid by
Tenant to Owner within five (5) days of rendition of any ▇▇▇▇ or statement
(INSERT 18) to Tenant therefor, and if Tenant's lease term shall have expired at
the time of making of such expenditures or incurring of such obligations, such
sums shall be recoverable by Owner as damages. (INSERT 19)
No Representations by Owner:
20. Neither Owner nor Owner's agents have made any representations or promises
with respect to the physical condition of the building, the land upon which it
is erected or the demised premises, the rents, leases, expenses of operation, or
any other matter affecting or related to the premises except as herein
3
INSERTS TO PAGE 3
1. , upon reasonable prior oral or written notice to the manager or
assistant manager of the demised premises,
2. in an emergency
2A. Subject to the provisions of this Article 14, Owner hereby grants
Tenant the exclusive permission to use and occupy the portion of the
vault(s) appurtenant to the demised premises, substantially where shown
in hatching on the second (2nd) page of Exhibit A hereto, for the term
of the lease and for the purposes expressly permitted under Section
44.01 of this lease, and for no other purpose. All such taxes, fees and
charges payable through the date next preceding the Commencement Date
shall be paid by Landlord, and twenty-five (25%) percent of all such
taxes, fees and charges payable from and after the Commencement Date
through the Expiration Date shall be paid by Tenant, the seventy-five
(75%) percent balance thereof to be paid by Landlord. Tenant shall pay
to Landlord, as Additional Rental and in addition to the Tax Payment
(as hereinafter defined), such twenty-five (25%) percent payment within
thirty (30) days after Landlord's demand therefor from time to time,
which demand shall be accompanied by the corresponding ▇▇▇▇ from the
municipal authority. Such use and occupancy shall be in accordance
with, and subject to the provisions of this lease, as if such vault
space were a part of the demised premises, except that (a) Tenant shall
not be obligated to pay any Fixed Rental (as hereinafter defined) or
Tax Payment with respect to such vault(s), (b) Tenant shall not
directly or indirectly, or by operation of law, or otherwise, assign or
otherwise transfer its rights to such vault(s) or permit any other
person or entity to use such vault(s), except in connection with an
assignment of this lease or a subletting of the demised premises
pursuant to Article 61 below, (c) nothing contained in this Article 14
or elsewhere shall be deemed to grant Tenant (or any person claiming
by, through or under Tenant), a leasehold interest in such vault(s),
and (d) notwithstanding anything contained in this lease to the
contrary, by virtue of the fact that such vault(s) are owned by a
governmental authority (and not by Landlord) and Landlord has no
control over whether or how Tenant may use or occupy such vault(s), all
of Tenant's rights to use and occupy such vault(s), including Tenant's
rights to make Changes, may not be permitted or may be subject to
1
approvals, consents, terms and conditions not set forth in, or
contemplated by, this lease, all of which Tenant hereby agrees to, to
the extent it wants to use such vault(s). Tenant acknowledges that
Owner has not made any representations or warranties whatsoever with
respect to such vault(s), the use or occupancy thereof or the
availability thereof. If, for any reason, Tenant is unable to use and
occupy, and actually ceases to use and occupy, a portion of such vault
space, the above mentioned percentages shall be adjusted accordingly,
on a per square foot basis, during such times that Tenant does not use
and occupy all of such vault space.
3. or any person or entity now or from time to time hereafter guaranteeing
any obligation or liability of Tenant with respect to this lease or the
demised premises (each of such persons or entities being hereinafter
referred to as a "Guarantor")
4. which is not dismissed within ninety (90) days after the date of such
filing if filed by a person or entity other than Tenant, any Guarantor
or any person or entity controlled by, which controls, or is under
common control with, Tenant or any Guarantor,
5. or any Guarantor
6. , except as otherwise expressly provided in Article 42 below,
7. upon Tenant a written ten (10) day notice for a default in the payment
of any item of Fixed Rental or Additional Rent, or a written thirty
(30) days notice for any other default (such other defaults being
hereinafter referred to as "Non-Monetary Defaults"), specifying
8. ten (10) day or thirty (30) day period, as the case may be,
9. Non-Monetary Default
10. thirty (30)
11. five (5)
12. , except to the extent required by law
13. , as provided by law
14. reasonable
15. or Tenant
2
16. Subject to all of the applicable terms, covenants and conditions
contained in this lease, including, without limitation, this Article
18, if on the date that this lease terminates under the provisions of
Article 17, or on the date Landlord re-enters the demised premises
under the provisions of Article 17, or on the date of the termination
of this lease, or of re-entry, by or under any summary dispossess or
other proceeding or action or any provision of law by reason of default
hereunder on the part of Tenant, as the case may be, but provided the
then Tenant is the Tenant named herein, Landlord agrees that it shall
not arbitrarily refuse to relet the demised premises (or portions
thereof), provided that if there shall then be other space available
for leasing or occupancy in the Building which is comparable to the
demised premises (or such portions) Landlord shall in no way be
required to relet the demised premises (or portions thereof) before or
in lieu of such other space. However, nothing contained herein shall be
deemed to require or obligate Landlord to re-let the demised premises
(or any such portion) at a rental which is below the then fair market
rental value for the demised premises (or such portions) or on terms
(including, without limitation, a rent abatement, construction
reimbursement or other concession or incentive) which, in Landlord's
reasonable judgment, are not commercially reasonable, or to lease such
space to a tenant which, in Landlord's reasonable judgment, (i) is not
in keeping with the then standards of the Building, (ii) proposes to
use such space for purposes other than as a first-class retail
establishment, (iii) will violate any negative covenant as to use
contained in any other lease of space in the Building, (v) is not a
reputable person of good character or does not have sufficient
financial worth considering the responsibilities involved, or (vi)
otherwise is not commercially acceptable to Landlord.
17. , in the case of any emergency (in which case, only reasonable (oral or
written) notice under the circumstances shall be required), or after
the giving of any required notice and the expiration of any applicable
cure period, in all other cases,
18. in reasonable detail (including evidence of the expenditure or
incurrence of the obligation)
19. The interest referred to above shall be at an annual rate set forth in
subsection 52.01(ii) below.
3
expressly set forth and no rights, easements or licenses are acquired by Tenant
by implication or otherwise except as expressly set forth in the provisions of
this lease. All understandings and agreements heretofore made between the
parties hereto are merged in this contract, which alone fully and completely
expresses the agreement between Owner and Tenant and any executory agreement
hereafter made shall be ineffective to change, modify, discharge or effect an
abandonment of it in whole or part, unless such executory agreement is in
writing and signed by the party against whom enforcement of the change,
modification, discharge or abandonment is sought.
End of Term:
21. Upon the expiration or other termination of the term of this lease, Tenant
shall quit and surrender to Owner the demised premises, broom clean, in good
order and condition, (INSERT 1) Tenant shall remove all its property. Tenant's
obligation to observe or perform this covenant shall survive the expiration or
other termination of this lease.
Quiet Enjoyment:
22. Owner covenants and agrees with Tenant that upon Tenant paying the rent and
additional rent and observing and performing all the terms, covenants and
conditions, on Tenant's part to be observed and performed, Tenant may peaceably
and quietly enjoy the premises hereby demised, subject, nevertheless, to the
terms and conditions of this lease including, but not limited to, Article 33
hereof and to the ground leases, underlying leases and mortgages hereinbefore
mentioned.
Failure to Give Possession:
23.
No Waiver:
24. The failure of Owner (INSERT 3) to seek redress for violation of, or to
insist upon the strict performance of any covenant or condition of this lease or
(INSERT 4) of any of the Rules or Regulations set forth or hereafter adopted by
Owner, shall not prevent a subsequent act which would have originally
constituted a violation from having all the force and effect of an original
violation. The receipt (INSERT 5) by owner (INSERT 3) of rent (INSERT 6) with
knowledge of the breach of any covenant of this lease shall not be deemed a
waiver of such breach and no provision of this lease shall be deemed to have
been waived by Owner (INSERT 3) unless such waiver be in writing signed by Owner
(INSERT 3). No payment by Tenant or receipt by Owner of a lesser amount than the
monthly rent herein stipulated shall be deemed to be other than on account of
the earliest stipulated rent, nor shall any endorsement or statement of any
check or any letter accompanying any check or payment as rent be deemed an
accord and satisfaction, and Owner may accept (INSERT 7) such check or payment
without prejudice to Owner's right to recover the balance of such rent or pursue
any other remedy in this lease provided (INSERT 8). No act or thing done by
Owner or Owner's agents during the term hereby demised shall be deemed in
acceptance of a surrender of said premises and no agreement to accept such
surrender shall be valid unless in writing signed by Owner. No employee of Owner
or Owner's agent shall have any power to accept the keys of said premises prior
to the termination of the lease and the delivery of keys to any such agent or
employee shall not operate as a termination of the lease or a surrender of the
premises.
Waiver of Trial by Jury:
25. It is mutually agreed by and between Owner and Tenant that the respective
parties hereto shall and they hereby do waive trial by jury in any action,
proceeding or counterclaim brought by either of the parties hereto against the
other (except for personal injury or property damage) on any matters whatsoever
arising out of or in any way connected with this lease, the relationship of
Owner and Tenant, Tenant's use of or occupancy of said premises, and any
emergency statutory or any other statutory remedy. It is further mutually agreed
that in the event Owner commences any summary proceeding for possession of the
premises. Tenant will not interpose any counterclaim of whatever nature or
description in any such proceeding (INSERT 9)
Inability to Perform:
26. (INSERT 10) lease and the obligation of Tenant to pay rent hereunder and
perform all of the other covenants and agreements hereunder on part of Tenant to
be performed shall in no wise affected, impaired or excused because Owner is
unable to fulfill any of its obligations under this lease or to supply or is
delayed in supplying any service expressly or impliedly to be supplied or is
unable to make, or is delayed in making any repair, additions, alterations or
decorations or is unable to supply or is delayed in supplying any equipment or
fixtures if Owner is prevented or delayed from doing by reason of strike or
labor troubles, government preemption in connection with a National Emergency or
by reason of any rule, order or regulation of any department or subdivision
thereof of any government agency or by reason of the conditions of supply and
demand which have been or are affected by war or other emergency, or when, in
the (INSERT 11) judgment of Owner, temporary interruption of such services is
necessary by reason of accident, mechanical breakdown, or to make repairs,
alteration or improvements.
Bills and Notices:
27. (INSERT 12)
Water Charges:
28.
Sprinklers:
29. (INSERT 13) elsewhere in this lease to the contrary notwithstanding, if the
New York Board of Fire Underwriters or the Insurance Services Office or any
bureau, department or official of the federal, state or city government require
or recommend the installation of a s sprinkler system or that any changes,
modifications, alterations, or additional sprinkler heads or other equipment be
made or supplied in an existing sprinkler system by reason of Tenant's business,
or the location of partition, trade fixtures, or other contents of the demised
premises, or for any other reason, or if any such sprinkler system
installations, changes, modifications, alteration, additional sprinkler heads or
other such equipment, become necessary to prevent the imposition of a penalty or
charge against the full allowance for a sprinkler system in the fire insurance
rate set by any said Exchange or by any fire insurance company. Tenant shall, at
Tenant's expense, promptly make such sprinkler system installations, charges,
modifications, alterations, and supply additional sprinkler heads or other
equipment as required whether the work involved shall be structural or
non-structural in nature.
Heat, Cleaning:
30.
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INSERTS TO PAGE 4
1. reasonable wear and tear, damage by fire or other casualty (except to
the extent caused by Tenant or any person or entity claiming by,
through or under Tenant) and items which are Landlord's expressed
obligation under this lease to repair or restore, excepted and, subject
to the provisions of Article 45 below,
2. Intentionally omitted
3. or Tenant
4. the failure of Owner to seek redress for violation of, or to insist
upon the strict performance
5. or payment
6. or other charges
7. and Tenant may make
8. , and without prejudice to Tenant's right to recover any excess payment
or to exercise any other right or remedy it may have under this lease,
at law or in equity
9. , provided that Tenant thereby waives no defense and does not lose the
ability to assert such claim in a separate action or proceeding
10. Except as otherwise expressly provided in this lease, this
11. reasonable
12. Except as otherwise expressly permitted in this lease, all notices,
demands, approvals, consents, requests and other communications which
under the terms of this lease, or under any statute, must or may be
given or made by the parties hereto, must be in writing, and must be
made either (i) by depositing such notice in the registered or
certified mail of the United States of America, return receipt
requested, or (ii) by delivering such notice by a commercial courier,
which courier provides for delivery with receipt guaranteed, addressed
to each party as follows:
If to Landlord: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
1
With a copy to: ▇▇▇▇▇▇ and ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. Ivanhoe, Esq.
and to: Sonesta International Hotels Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
If to Tenant: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
Vice-President of
Planning and Construction
With a copy to: Goulston & Storrs
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq./
J. Crew
and to: all Guarantors, at the address(es) set
forth in the Guaranty(ies).
All notices, demands, approvals, consents, requests and other
communications shall be deemed to have been delivered (i) if mailed as
provided for in this Section, on the date which is three (3) business
days after mailing or (ii) if sent by commercial courier, on the date
which is one (1) business day after dispatching. Either party may
designate by notice in writing given in the manner herein specified a
new or other address to which such notice, demand, approval, consent,
request or other communication shall thereafter be so given or made.
Notwithstanding the foregoing all Fixed Rental and Additional Rent
statements, bills and invoices may be given by regular mail and
Landlord shall be required to give only copies of default notices and
termination notices to any person or entity other than Tenant.
13. Except as otherwise expressly provided in item 4 of Part A of Exhibit
F hereto, anything
2
Security:
31.
Captions:
32. The Captions are inserted only as a matter of convenience and for reference
and in no way define, limit or describe the scope of this lease nor the intent
of any provision thereof.
Definitions:
33. The term "Owner" as used in this lease means only the Owner, or the
mortgagee in possession, for the time being of the land and building (or the
Owner of a lease of the building or of the land and building) of which the
demised premises form a part, so that in the event of any sale or sales of said
land and building or of said lease, or in the event of a lease of said building,
or of the land and building, the said Owner shall be and hereby is entirely
freed and relieved of all covenants and obligations of Owner hereunder, and it
shall be deemed and construed without further agreement between the parties of
their successors in interest, or between the parties and the purchaser, at any
such sale, or the said lessee of the building, or of the land and building, that
the purchaser or the lessee of the building has assumed and agreed to carry out
any and all covenants, and obligations of Owner hereunder. The words "re-enter"
and "re-entry" as used in this lease are not restricted to their technical legal
meaning. The term "business days" as used in this lease shall exclude Saturdays
(except such portion thereof as is covered by specific hours in Article 30
hereof), Sundays and all days designated as holidays by the applicable building
service union employees service contract or by the applicable Operating
Engineers contract with respect to HVAC service.
Adjacent Excavation Shoring:
34. If an excavation shall be made upon land adjacent to the demised premises,
or shall be authorized to be made, (INSERT 1) Tenant shall afford to the person
causing or authorized to cause such excavation, license to enter upon the
demised premises for the purpose of doing such work as said person shall deem
necessary to preserve the wall or the building of which demised premises form a
part from injury or damage and to support the same by proper foundations without
any claim for damages or indemnity against Owner, or diminution or abatement of
rent.
Rules and Regulations:
35. Tenant and Tenant's servants, employees, agents, visitors, and licensees
shall observe faithfully and comply strictly with the Rules and Regulations and
such other and further reasonable Rules and Regulations as Owner or Owner's
agents may from time to time adopt (INSERT 2) Notice of any additional rules or
regulations shall be given in such manner as Owner may elect (INSERT 3) In case
Tenant disputes the reasonableness of any additional Rule or Regulation
hereafter made or adopted by Owner or Owner's agents, the parties hereto agree
to submit the question of the reasonableness of such Rule or Regulation for
decision to the New York office of the American Arbitration Association, whose
determination shall be final and upon the parties hereto. The right to dispute
the reasonableness of any additional Rule or Regulation upon Tenant's part shall
be deemed waived unless the same shall be asserted by service of a notice in
writing upon Owner within (INSERT 4) days after the giving of notice thereof.
Nothing in this lease contained shall be construed to impose upon Owner any duty
or obligation to enforce the Rules and Regulations or terms, covenants or
conditions in any other lease, as against any other Tenant and Owner shall not
be liable to Tenant for violation of the same by any other Tenant, its servants,
employees, agents, visitors or licensees.
(INSERT 5)
Glass:
36. (INSERT 6) shall replace, at the expense of Tenant, any and all plate and
other glass damaged or broken from any cause whatsoever in and about the demised
premises.
Pornographic Uses Prohibited:
37. Tenant agrees that the value of the demised premises and the reputation of
th Owner will be seriously injured if the premises are used for any obscene or
pornographic purposes or any sort of commercial sex establishment. Tenant agrees
that Tenant will not bring or permit any obscene or pornographic material on the
premises, and shall not permit or conduct any obscene, nude or semi-nude live
performances on the premises, nor permit use of the premises for nude modeling,
rap sessions, or as a so-called rubber goods shops, or as a sex club or any
sort, or as a "massage parlor." Tenant agrees further that Tenant will not
permit any of these uses by any sublease or assignee of the premises. This
Article shall directly bind any successors in interest to the Tenant. Tenant
agrees that if at any time Tenant violates any of the provisions of this
Article, such violation shall be deemed a breach of a substantial obligation of
the terms of this lease and objectionable conduct. Pornographic material is
defined for purposes of this Article as any written or pictorial matter with
prurient appeal or any objects of instrument that are primarily concerned with
lewd or prurient sexual activity. Obscene material is defined here as it is in
Penal law ss.235.00.
Estoppel Certification:
38. (INSERT 8)
Successors and Assigns:
39. The covenants, conditions and agreements contained in this lease shall bind
and inure to the benefit of Owner and Tenant and their respective heirs,
distriubtees, executors, administrators, successors, and except as otherwise
provided in this lease, their assigns.
A RIDER CONSISTING OF ADDITIONAL ARTICLES TO THIS LEASE IS ATTACHED HERETO.
5
INSERT TO PAGE 5
1. , upon reasonable prior written notice to Tenant,
2. , and Tenant shall use its reassonable efforts to cause its visitors
and invitees to observe faithfully, and comply strictly with all of
such Rules and Regulations.
3. , but at least ten (10) days prior to the effective date thereof, which
notice shall be accompanied by a copy of the further reasonable Rules
and Regulations in question.
4. thirty (30)
5. In the event of a conflict between the provisions of this lease and a
Rule and Regulation, the provision of this lease shall prevail. All
Rules and Regulations shall be enforced in a uniform and
non-discriminatory manner.
6. Tenant
7. Intentionally omitted
8. Each party agrees, at any time and from time to time, as requested by
the other party, upon not less than twenty (20) days' prior notice, to
execute and deliver to the other a statement (a) certifying that this
lease is unmodified and in full force and effect (or if there have been
modifications, that the same is in full force and effect as modified
and stating the modifications) and whether any options granted to
Tenant pursuant to the provisions of this lease have been exercised,
(b) certifying the dates to which the Fixed Rental and Additional Rent
have been paid and the amounts thereof, and stating whether or not, to
the best knowledge of the signer, the other party is in default in
performance of any of its obligations under this lease, and, if so,
specifying each such default of which the signer may have knowledge,
(c) certifying the existence of any set-offs or defenses against the
enforcement of any of the terms, covenants or conditions to be
performed or complied with hereunder, and (d) whether the Commencement
Date, Substantial Completion Date or Election Date (as such terms are
hereinafter defined) have occurred (and if so, specifying such date(s))
and whether the Landlord's Work (as hereinafter defined) has been
substantially completed or completed (and if so, specifying the dates
of such substantial completion or completion, as to the entire
1
Landlord's Work or portions thereof, or if not, which items of
Landlord's Work have not been substantially completed or completed), it
being intended that any such statement delivered pursuant hereto may be
relied upon by others with whom the party requesting such certificate
may be dealing. In addition, each such statement shall contain such
other information as shall be reasonably required by a prospective
purchaser of the Building or by the holder or prospective holder of a
superior mortgage or the lessor or prospective lessor of a superior
lease, or by a prospective assignee of this lease or propspective
subtenant of the demised premises or propspective transferee of the
stock of Tenant.
2
ACKNOWLEDGMENTS
RULES AND REGULATIONS ATTACHED TO AND
MADE A PART OF THIS LEASE
IN ACCORDANCE WITH ARTICLE 35.
1. The sidewalks, entrances, driveways, passages, courts, elevators, vestibules,
stairways, corridors or halls shall not be obstructed or encumbered by any
Tenant or used for any purpose other than for ingress to and egress from the
demised premises and for delivery of merchandise and equipment in a prompt and
efficient manner using elevators and passageways designated for such delivery by
Owner. There shall not be used in any space, or in the delivery or receipt of
merchandise, any hand trucks except those equipped with rubber tires and
safeguards.
2.
3. The water and was closets and plumbing fixtures shall not be used for any
purposes other than those for which they were designed or constructed.
4.
5.
6.
7. Freight, furniture, business equipment, merchandise and bulky matter of any
description shall be delivered to and removed from the premises only on the
freight elevators and through the service entrances and corridors.. Owner
reserves the right to inspect all freight to be brought into the building and to
exclude from the building all freight which violates any of these Rules and
Regulations or the lease of which these Rules and Regulations are a part.
8.
9.
10.
11. Tenant shall not place a load on any floor of the demised premises exceeding
the floor load per square foot area which it was designed to carry and which is
allowed by law. Owner reserves the right to prescribe the weight and position of
all safes, business machines and mechanical equipment. Such installations shall
be placed and maintained by Tenant at Tenant's expense in setting sufficient in
Owner's judgment to absorb and prevent vibration, noise and annoyance.
6
===============================================================================
RIDER
ADDITIONAL CLAUSES ATTACHED TO AND FORMING A PART OF LEASE
DATED JANUARY 29, 1996 BETWEEN
THE SOHO HOTEL COMPANY, L.P., LANDLORD, AND
▇▇▇▇▇ ▇▇▇▇▇▇, INC., TENANT.
===============================================================================
40. RENTAL; TERM: Tenant covenants to pay to Landlord, at the address
hereinbefore set forth or at such other address as Landlord shall designate,
the following sums:
40.01 a fixed rental ("Fixed Rental") at an annual rate of:
(a) Eight Hundred Seventy-Five Thousand ($875,000.00) Dollars
($72,966.67 per month) for the period commencing on the Commencement Date (as
such term is hereinafter defined) and ending on the day next preceding the third
(3rd) anniversary of the Commencement Date, both dates inclusive;
(b) Nine Hundred Sixty-Two Thousand Five Hundred ($962,500.00)
Dollars ($80,208.33 per month) for the period commencing on the third (3rd)
anniversary of the Commencement Date and ending on the day next preceding the
sixth (6th) anniversary of the Commencement Date, both dates inclusive;
(c) One Million Fifty-Eight Thousand Seven Hundred Fifty
($1,058,750.00) Dollars ($88,229.17 per month) for the period commencing on the
sixth (6th) anniversary of the Commencement Date and ending on the day next
preceding the ninth (9th) anniversary of the Commencement Date, both dates
inclusive;
(d) One Million One Hundred Sixty-Four Thousand Six Hundred
Twenty-Five ($1,164,625.00) Dollars ($97,052.08 per month) for the period
commencing on the ninth (9th) anniversary of the Commencement Date and ending on
the day next preceding the twelfth (12th) anniversary of the Commencement Date,
both dates inclusive; and
(e) One Million Two Hundred Eighty-One Thousand Eighty-Eight
($1,281,088.00) Dollars ($106,757.33 per month) for the period commencing on the
twelfth (12th) anniversary of the Commencement Date and continuing thereafter
throughout the remainder of the term of this lease,
payable in equal monthly installments, in advance, without previous demand
therefor and without any setoff or deduction whatsoever (except as otherwise
expressly set forth in this lease), on the first day of each and every calendar
month throughout the term of this lease, except that the first installment of
Fixed Rental shall be paid on or before the Commencement Date and shall be
prorated for partial months; and
40.02 "Additional Rent" or "Additional Rental," consisting of all such
other sums of money as shall become due from and payable by Tenant to Landlord
(for default in payment of which Landlord shall have the same remedies as a
default in payment of Fixed Rental).
1
40.03 The term of this lease shall commence on the date (the
"Commencement Date") which is the earlier of (a) the Substantial Completion Date
(as such term is defined in Article 49), but in no event earlier than April 1,
1996, and (b) the date (if any) on which Tenant gives to Landlord the Election
Notice (as defined in Subsection 49.01(c)), and shall expire on the date (the
"Expiration Date") which shall be the day next preceding the fifteenth (15th)
anniversary of the Commencement Date (or the January 31st immediately following
the day next preceding the fifteenth (15th) anniversary of the Commencement
Date, if the day next preceding the fifteenth (15th) anniversary of the
Commencement Date is between September 1 and January 31 and if the term of this
lease has not been renewed pursuant to Article 55 below), or such earlier date
upon which the term may cease or expire. In the event that the Commencement Date
or Expiration Date shall not occur on the first day or last, respectively, of a
calendar month, the monthly installment of Fixed Rental for such month shall be
prorated.
40.04 Landlord shall waive the right to collect Fixed Rental reserved
under this Article 40 during the period (the "Free Rent Period") between the
Commencement Date and the date which is 180 days after the Commencement Date,
except that if the Commencement Date is the date on which Tenant gives to
Landlord the Election Notice (as defined in Section 49.01(b) below), the Free
Rent Period shall end on the date which is eight (8) months after the
Commencement Date. If the last day of the Free Rent Period is not the last day
of a calendar month, then the Fixed Rental payable for the calendar month in
which such last day occurs shall be prorated. Notwithstanding anything contained
in the preceding sentence to the contrary, the Fixed Rental abatement provided
for in the preceding sentence shall be suspended during any time that this lease
shall not be in full force and effect and during any time that Tenant shall be
in default (after the giving of any required notice and the expiration of any
required cure period) of any of the terms, covenants or conditions in this lease
on Tenant's part to observe, perform or comply with. If any such default has
occurred and Landlord accepts Tenant's cure after the expiration of the cure
period, the Free Rent Period shall be reinstated so as to complete such 180 day
or eight (8) month period, as the case may be.
40.05 Landlord shall have the right to direct Tenant to pay, and Tenant
hereby agrees to pay, all or any portion of the amounts due to Landlord under
this lease to any entity or person designated by Landlord in a written notice to
Tenant sent in the manner set forth in this lease and Tenant shall continue to
make such payments to such designated party until Tenant receives a written
notice from Landlord revoking such direction or designating a different entity
or person or a different amount to be paid. Such designee shall have no further
rights to such payment other than those Landlord shall have against Tenant and
Tenant shall retain all defenses, offsets and counterclaims expressly set forth
in this lease with respect to such payment.
41. TAX ESCALATION:
41.01 For the purpose of Sections 41.01-41.06:
(a) "Taxes" shall mean all the real estate taxes or payments in
lieu thereof, assessments, special assessments, sewer rents, sewer charges and
all other charges, taxes, rents, levies and sums of every kind or nature
whatsoever, extraordinary as well as ordinary, whether or not now within the
contemplation of the parties, as shall during the term of this lease, be imposed
or assessed by any governmental, public or quasi-governmental
2
authority, upon the Building and the land (the "Land") on which the Building is
located, and all taxes, assessments and charges levied, assessed or imposed upon
the Building and the Land in lieu of, or in addition to, or in substitution for,
the foregoing, under or by virtue of any present or future laws, rules,
requirements, orders, directives, ordinances, or regulations of the United
States of America, or of the State, County, Town, Borough, Village, or City
government, or of any municipal bureau, department, or other lawful authority
whatsoever. Notwithstanding the foregoing, for the purposes of calculating the
Tax Payment (as hereinafter defined), the calculation of "Taxes" shall be based
on the product of (x) the tax rate then in effect for the applicable Tax Year
for the class of buildings in which the Building shall be classified, multiplied
by (y) the actual assessed valuation of the Building and Land, without regard to
any abatements, deferments, incentives or other means by which the actual
assessed valuation may be reduced, andregardless of the fact that the Taxes
payable by Landlord may be based on an assessed valuation or so-called
"transitional" assessment that is less than said actual valuation. "Taxes" shall
not include Landlord's income taxes, franchise taxes, unincorporated business
taxes, inheritance taxes or estate taxes, except as expressly provided below. If
at any time during the term of this lease the methods of taxation prevailing at
the commencement of the term hereof shall be altered so that in lieu of or as a
substitute for the whole or any part of, or as an addition to (to the extent
such addition is viewed by the real estate industry in the City of New York as a
new or additional tax, assessment, levy, imposition, or charge on real estate or
the improvements thereon and is customarily passed through to tenants pursuant
to real estate tax escalation provisions of commercial leases) the taxes,
assessments, levies, impositions or charges now levied, assessed or imposed on
real estate and the improvements thereon, there shall be levied, assessed or
imposed (i) a tax, assessment, levy, imposition or charge wholly or partially as
capital levy or otherwise on the rents received therefrom, or (ii) a tax,
assessment, levy, imposition or charge measured by or based in whole or in part
upon the Building and the Land, and imposed upon Landlord, or (iii) a license
fee measured by the rents payable by Tenant to Landlord, or (iv) Landlord's
income taxes, franchise taxes, unincorporated business taxes, inheritance taxes
or estate taxes, then all such taxes, assessments, levies, impositions or
charges, or the part thereof so measured or based shall be deemed to be included
within the term "Taxes" for the purposes hereof, as if the Building and the Land
were Landlord's only real estate assets and the rents and other monies generated
thereby were Landlord's only real estate income;
(b) "Base Tax Rate" shall mean $425,000.00;
(c) "Tax Year" shall mean the fiscal year for which Taxes are
levied by the governmental authority (the "Tax Authority"); and
(d) "Tenant's Proportionate Share" shall mean 18%.
41.02 Tenant shall pay, as Additional Rent for each Tax Year occurring
entirely or partially during the term of this lease, an amount equal to Tenant's
Proportionate Share of the amount, if any, by which the Taxes for such Tax Year
exceed the Base Tax Rate. (The amount payable by Tenant is hereinafter referred
to as the "Tax Payment".) The Tax Payment shall be appropriately prorated, if
necessary, to correspond with that portion of a Tax Year occurring within the
term of this lease. The Tax Payment shall be payable by Tenant within thirty
(30) days after receipt of a demand from Landlord therefor, which demand shall
be accompanied by a copy of the tax ▇▇▇▇ together
3
with Landlord's computation of the Tax Payment. If the Taxes for any Tax Year
are payable to the taxing authority on an installment basis, Landlord shall
serve such demands upon, and the Tax Payment for such Tax Year shall be payable
by Tenant, on a corresponding installment basis. Provided Tenant has paid the
Tax Payment in accordance with this Article 41, Landlord shall pay the Taxes
(which may, as more particularly described above, be less than the Taxes upon
which the Tax Payment is based) for all Tax Years during which any portion of
the term of this lease occurs, before the imposition by the Tax Authority of any
late charges or penalties.
41.03 Notwithstanding the fact that the Tax Payment is measured by an
increase in Taxes, such Additional Rent shall be paid by Tenant as provided
herein regardless of the fact that Tenant may be exempt, in whole or in part,
from the payment of any taxes by reason of Tenant's diplomatic or other tax
exempt status or for any other reason whatsoever.
41.04 Only Landlord shall be eligible to institute tax reduction or
other proceedings to reduce the Taxes for any Tax Years. To the extent Landlord
is successful in any such proceedings and obtains a refund in Taxes for any
period that Tenant has made a Tax Payment that is the result of a reduction in
the actual assessed valuation of the Land and/or the Building, Landlord shall
promptly pay to Tenant Tenant's Proportionate Share of such refund that is
attributable to such reduction, based on the actual amount of such refund, and
not the amount of the Tax Payment (which Tax Payment, as more particularly
described above, is not based on the Taxes payable by Landlord). Tenant shall
pay to Landlord as Additional Rent and within thirty (30) days after Landlord's
demand therefor, Tenant's Proportionate Share of the reasonable or customary
third-party out-of-pocket costs and expenses incurred or paid by Landlord in
connection with such proceedings or, at Landlord's option, Landlord may deduct
such costs and expenses from the amount of any refund in Taxes to which Tenant
is entitled pursuant to this Section 41.04.
41.05 (a) Anything in this Article 41 to the contrary notwithstanding,
in the event that the holder of any superior mortgage or the lessor of any
superior lease (as such terms are defined in Section 51.01 below) shall require
advance payments from the Landlord on account of Taxes, then Tenant will pay to
Landlord Tenant's Proportionate Share of any amounts required to be paid in
advance by Landlord with the holder of the superior mortgage or the lessor of
the superior lease to the extent that such payments made by Landlord exceed the
Base Tax Rate, but based on "Taxes" as calculated for the purposes of
calculating the Tax Payment. Any payments to be made by Tenant under this
Section 41.05(a) shall be made at least ten (10) days prior to the date Landlord
is required to make such payments to the holder of the superior mortgage or the
lessor of the superior lease, but no more than thirty (30) days prior to such
date;
(b) Nothing contained in Sections 41.01 through 41.05 hereof
shall reduce the Fixed Rental below the Fixed Rental initially set forth in
Section 40.01 hereof as same may be increased by provisions of this lease other
than Sections 41.01 through 41.05.
42. GUARANTY.
42.01 Landlord and Tenant acknowledge that J. Crew Group, Inc. ("J.
Crew") , as Guarantor (as such term is defined in Article 16 above) is
contemporaneously with the execution and delivery of this lease by Tenant,
executing and delivering to Landlord a guaranty of even date with this lease
(the "Guaranty")
4
with respect to this lease. It shall be a Non-Monetary Default under this lease
(entitling Landlord to exercise any or all of its rights and remedies under this
lease, at law or in equity) if any of the warranties or respresentations of J.
Crew set forth in the Guaranty are false, incorrect or misleading in any
material respect.
42.02 Notwithstanding anything contained in Article 17 above to the
contrary, if the then Tenant is neither the Tenant named in this lease (as of
the initial execution hereof) nor a person or entity that is a Related Entity
(as defined in Section 61.15 below) of the Tenant so named in this lease, then
(a) any default by Tenant (other than a default under Article 16 above) may be
cured by any Guarantor, and Landlord hereby agrees to accept such cure by any
Guarantor as if such cure were made by Tenant, and (b) the ten (10) day and
thirty (30) day periods set forth in Article 17 above to cure such defaults
shall be deemed extended (for Guarantors only, and not for Tenant) by five (5)
days each to fifteen (15) days and thirty-five (35) days, respectively.
43. ELECTRICITY.
43.01 Tenant shall obtain and pay for Tenant's entire separate supply of
electric current by direct application to and arrangement with the public
utility company servicing the Building and shall arrange for the installation of
its own electric meter with such utility company at Tenant's sole cost and
expense. Landlord will permit Tenant to connect its feeders and wiring to the
800 ampere switch described in the Plans (as defined in Section 49.01 below) for
Tenant's use and may use any existing conduit for Tenant's feeders and wiring
from the electric switch to the Demised Premises.
43.02 To the extent that any additional risers, feeders or other
equipment or service that are proper or necessary to supply Tenant's electrical
requirements in accordance with Section 43.01 above must be installed outside
the demised premises, Landlord shall, promptly after the written request of
Tenant, but provided Tenant is not then in default (after the giving of any
required notice and the expiration of any required cure period) of any of the
terms, covenants or conditions in this lease, at the sole cost and expense of
Tenant (to the extent such costs and expenses have been approved and agreed to
by Tenant, install such additional risers, feeders or other equipment or
service, but only to the extent, in Landlord's sole judgment (which judgment
shall not be arbitrarily or in bad faith exercised), the same will not damage
any part of the Building or the demised premises or cause or create a dangerous
or hazardous condition or unreasonably interfere with or disturb the operation
of the Building or the other tenants or occupants of the Building, and only if
Tenant has approved such costs and expenses in writing. Such costs and expense
shall be paid by Tenant to Landlord, as Additional Rent, within thirty (30) days
after Landlord's demand therefor, which demand shall be accompanied by invoices
or other reasonable evidence of such costs and expenses. Notwithstanding
anything in this Section which may be deemed to the contrary, all such
installations that are to be made outside the demised premises that are in
connection with Tenant's Work, and all such installations that are to be made
inside the demised premises, shall be made by Tenant, at Tenant's sole cost and
expense, but subject to, and in accordance with, Articles 3 and 45 and the other
applicable provisions of this lease. In all cases, rigid conduit only will be
allowed.
43.03 Landlord shall not in anywise be liable or responsible to Tenant
for any loss or damage or expense which Tenant may sustain or incur if either
the quantity or character
5
of electric service is changed or is no longer available or suitable for
Tenant's requirements, except to the extent caused by the negligence or
intentionally wrongful acts or omissions of Landlord or any of Landlord's
employees or agents, but subject to the provisions of Article 48 below.
43.04 Tenant agrees not to connect any additional electrical equipment
of any type to the Building electric distribution system, beyond that on
Tenant's approved plans for initial occupancy, without the Landlord's prior
written consent, which consent shall not be unreasonably withheld, delayed or
conditioned. In no event shall Tenant use or install any fixtures, equipment or
machines, the use of which in conjunction with other fixtures, equipment and
machines in the Demised Premises would result in an overload of the electrical
circuits servicing the Demised Premises or the Building.
43.05 Tenant covenants and agrees that at all times its use of electric
current shall never exceed the capacity of the then existing feeders to the
Building or the risers or wiring installation. Tenant shall furnish, install and
replace, as required, all lighting tubes, lamps, bulbs and ballasts required in
the Demised Premises, at Tenant's sole cost and expense. All lighting tubes,
lamps, bulbs and ballasts so installed shall become Landlord's property upon the
expiration or sooner termination of this lease, excluding any of the foregoing
which relate to the track lighting fixtures that are a part of Tenant's Property
(as defined in Article 45 below).
44. USE AND OCCUPANCY:
44.01 Subject to and in accordance with all rules, regulations, laws,
ordinances, statutes and requirements of all governmental authorities and the
Fire Insurance Rating Organization and Board of Fire Insurance Underwriters, and
any similar bodies having jurisdiction thereof, Tenant covenants and agrees that
it shall use the Demised Premises solely for the operation of a retail store for
sale to the public of men's and/or women's (and, at Tenant's option, children's)
apparel, shoes, accessories and related items as sold in a majority of other J.
Crew (non-outlet) retail stores (or which are not similar to, but are equal or
better in quality, character and price point than, the merchandise sold in a
majority of other J. Crew retail stores, including, without limitation, any
items that are so equal or better that are sold through the "J. Crew"
catalogues), and, at Tenant's option, the retail sale to the public of home
furnishings, furniture and related accessories, and for no other purpose. For
the purposes of this Section 44.01, "J. Crew" shall mean the permitted other
names referred to in Section 53.10 below.
44.02 Tenant covenants that Tenant will not use or suffer or permit any
person to use the Demised Premises for any unlawful purpose and to 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 thereon, including,
without limitation, a temporary certificate of occupancy for the Building
permitting the demised premises to be used for retail purposes (as more
particularly provided in Section 49.03 below). Tenant further covenants to
comply with all applicable laws, resolutions, codes, rules and regulations of
any department, bureau, agency or any governmental authority having jurisdiction
over the operation in, or occupancy, maintenance and use of, the Demised
Premises for the purposes set forth herein, except to the extent Landlord may,
expressly under this lease, be required to comply with same. Tenant will
indemnify and save Landlord harmless from and against
6
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 Tenant's use and occupancy, unless the
obligation to comply with such law, rules or regulations shall be Landlord's
obligations pursuant to the expressed provisions of this lease.
44.03 At all times that Tenant is open for business and is not in
default (after the giving of any applicable notice and the expiration of any
applicable cure period), Landlord shall operate (or cause to be operated) the
balance of the Building in a first-class manner, and shall not permit the
occupancy thereof for any of the uses prohibited by Article 37 thereof or for an
off-track betting establishment.
44.04 Landlord represents to Tenant that attached hereto as Exhibits C
and D (which by this reference are made a part hereof) are true and complete
copies of the Resolution (C 910115 ZSM), duly adopted by the New York City
Planning Commission on March 6, 1991 (Calendar No. 14), approving the
application for the grant of a special permit (as more particularly set forth in
said Resolution), and the Declaration made the 6th day of March, 1991 and
referred to in said Resolution, as modified by a First Modification to
Declaration dated May 8, 1991 and a Second Modification of Declaration made as
of the 11th day of December, 1995, and that the special permit referred to in
said Resolution and the said Declaration, as so modified, are in full force and
effect. Tenant hereby acknowledges that it has actual notice of said special
permit. Tenant hereby acknowledges and agrees that this lease and Tenant's
rights hereunder, are subject to said Resolution and to said Declaration, as so
modified. Tenant shall not violate any of the covenants, restrictions,
agreements, terms or conditions of said Resolution or said Declaration, as so
modified, and as said Resolution or Declaration may be modified or further
modified. Provided Tenant, and all persons and entities claiming by, through or
under Tenant, have not violated any of such covenants, restrictions, agreements,
terms or conditions, Landlord shall maintain said special permit and
Declaration, as so modified, in full force and effect, to the extent necessary
to permit Tenant to use the demised premises for the purposes expressly
permitted under this lease, but provided further that Tenant is in compliance
with all of its obligations under this lease that are necessary to permit Tenant
to use the demised premises for such purposes. In furtherance of such
maintenance obligation, Landlord shall perform the maintenance and repair work
with respect to said special permit and Declaration (as modified), that is
described in Article 4 above. Promptly after Landlord's receipt of any notice of
a violation of said Resolution or said Declaration, as modified, that relates to
the interior or exterior of the demised premises, Landlord shall send a copy of
such notice to Tenant.
45. TENANT'S INSTALLATIONS:
45.01 Notwithstanding anything hereinbefore contained to the contrary,
provided Tenant complies with all Legal and Insurance Requirements (as defined
in Article 6 above), and, provided further, Tenant is not in default (after the
giving of any required notice and the expiration of any required cure period)
under any of the terms, covenants and conditions of this lease, Tenant shall
have the right, at its own cost and expense, but subject to the provisions of
Article 3 above, to install such new or re-conditioned, first class machinery,
equipment and fixtures as may be required or desired by Tenant for the proper
conduct of Tenant's business. Subject to the provisions of this Article, any and
all movable machinery, equipment and fixtures installed by Tenant (sometimes
herein referred to as "Tenant's Property") shall remain personalty
notwithstanding the fact that
7
it may be affixed or attached to the realty, and shall, during the term of this
lease or any extension or renewal thereof, belong to and be removable by Tenant,
provided that (i) Tenant shall remove said installations prior to the expiration
of such term or the sooner termination thereof; and (ii) Tenant shall repair any
damage caused by said removal and shall deliver the Demised Premises to Landlord
in the same condition as upon the commencement of the term hereof, reasonable
wear and tear, damage by fire or other casualty and items which are Landlord's
expressed obligation under this lease to repair or restore, excepted. Prior to
the expiration of the term or sooner termination thereof, Tenant shall, at its
own cost and expense, remove from the Demised Premises all of Tenant's Property,
except such items thereof as Tenant shall have expressly agreed in writing with
Landlord are to remain and to become the property of Landlord, and Tenant shall
repair any damage to the demised premises resulting from such removal.
45.02 Tenant shall ascertain from Landlord, in a written request to
Landlord, whether Landlord will require Tenant to have any non-movable fixtures,
machinery and/or equipment permanently installed by Tenant, removed from the
Demised Premises upon the expiration or sooner termination of the term of this
lease. Tenant may request such determination from Landlord prior to the
installation of any of the foregoing. Landlord's failure to respond to such
request within ten (10) days after Landlord's receipt thereof shall be deemed
Landlord's determination that the item(s) in question do not have to be so
removed, provided the request expressly states that Landlord's failure to
respond within such ten (10) day period will be deemed Landlord's determination
that the item(s) in question do not have to be so removed. Unless, Landlord and
Tenant, in writing, subsequently agree to the contrary, upon the expiration or
sooner termination of the term of this lease, Tenant shall, at Tenant's sole
cost and expense, remove the items that Landlord has required to be so removed
and restore the Demised Premises with respect thereto, to the same condition as
upon the commencement of the term hereof, reasonable wear and tear excepted. To
the extent Tenant fails to ascertain whether Landlord will require such removal
of any of the foregoing items, Landlord shall have the option to have Tenant so
remove such item(s) upon the expiration or sooner termination of the term of
this lease. All fixtures, machinery and equipment installed by Tenant, except
those items which Landlord agrees are to remain in the Demised Premises and
become the property of Landlord, remaining within the Demised Premises after the
expiration of such term or sooner termination thereof and after Tenant is no
longer in possession of the Demised Premises shall, at Landlord's option and
upon at least ten (10) days' prior written notice to Tenant, either (i) become
the property of Landlord, free of any claim by Tenant or any person claiming
through Tenant, or (ii) be removed and disposed of by Landlord, at Tenant's cost
and expense, without further notice to or demand upon Tenant. Machinery,
fixtures, chattels, or equipment, if any, furnished or installed by Tenant, the
cost of which is to be borne by Landlord, shall become the property of Landlord
upon payment therefor by Landlord or reimbursement of Tenant by Landlord, as the
case may be, and shall not be removed by Tenant. Tenant's obligations under this
Article shall survive the expiration or sooner termination of the term hereof.
Anything herein contained to the contrary notwithstanding, it is understood and
agreed that all structural improvements made by Tenant in the Demised Premises
shall be surrendered to the Landlord at the expiration of the term.
45.03 Tenant acknowledges that the Building has been designated a
historic landmark and/or is located in a historic district and as a result,
Changes, including the installation of Tenant's Property, may be subject to the
approval of various
8
governmental or quasi-governmental departments and agencies. Tenant covenants
and agrees that it will comply with all requirements of such departments and
agencies in prosecuting all of the Changes and shall not commence any Changes
until all required approvals are obtained and conditions contained therein are
complied with, all as more particularly provided in Article 3 above.
45.04 Tenant shall use Construction Consulting ("Landlord's Filing
Architect") in connection with all filings and obtaining all permits,
certificates and approvals required by governmental or quasi-governmental bodies
with respect to all Tenant's Work (and Landlord's Work (to the extent Tenant
performs same pursuant to subsection 49.01(c)below)), provided that the charges
of Landlord's Filing Architect are comparable for similar services rendered for
similar projects in New York City.
46. SIGNS:
46.01 In accordance with, and subject to, Article 3 of this lease and
all applicable Legal and Insurance Requirements (including without limitation,
the requirements of the New York City Landmarks Preservation Commission), Tenant
shall have the right to install and maintain, at its sole cost and expense, (a)
the sign described in Exhibit E hereto (which by this reference is made a part
hereof) in each pane of glass comprising the storefront of the demises premises,
(b) one (1) perpendicular exterior "banner" sign that is consistent with the
aesthetic of the balance of the Building, and (c) permanent interior signs,
subject in the cases described in clauses (b) and (c) to Landlord's prior
written approval, which shall not be unreasonably withheld delayed or
conditioned, including, without limitation, approval as to materials, size,
design location and (in the case of said banner sign ) as to the method of
attachment to the Building and such consistency, and (b) temporary interior
signs for which Landlord's approval shall not be required. Landlord's prior
written approval shall be required for all other signs, which approval may be
withheld for any good faith reason or be subject to the satisfaction of any good
faith conditions. Tenant shall obtain and pay for all permits required therefor.
Tenant expressly agrees that such signs shall not be installed on the Building
until all approvals and permits are first obtained and copies thereof delivered
to Landlord with evidence of payment for any fees pertaining thereto. Tenant
agrees to pay all annual renewal fees pertaining to Tenant's signs.
46.02 As used in this paragraph, the word "sign" shall be construed to
include any placard, banner, flag, light or other advertising symbol or object
irrespective of whether same be temporary or permanent but shall exclude menu
boards.
46.03 In the event Landlord or Landlord's representatives shall deem it
necessary to remove any such sign or signs in order to paint or to make any
other repairs, alterations or improvements in or upon the Premises or the
Building wherein same is located, or any part thereof, the Landlord shall have
the right to do so, provided the same be removed and replaced at Landlord's
expense, whenever the said repairs, alterations or improvements shall have been
completed, and upon Tenant's prior written consent (which shall not be
unreasonably withheld or delayed) if the removal shall be for more than two (2)
consecutive business days. During any time that any of Tenant's signs are so
removed, Landlord, at Landlord's sole cost and expense, shall install and
maintain a reasonable temporary sign, which shall be removed by Landlord, at
Landlord's sole cost and expense, upon Landlord's replacement of the sign(s) so
removed by Landlord. Landlord shall use commercially reasonable efforts (with no
obligation to employ
9
overtime labor or otherwise to pay a premium) to perform the work in question
in a prompt and diligent manner so as to minimize the time that Tenant's signs
are removed.
46.04 Notwithstanding anything contained in this lease to the contrary,
Tenant shall not be permitted to install any awnings without Landlord's prior
written consent in each instance. If Landlord at any time desires to install
awnings to portions of the Building other than the demised premises, then
Landlord shall so notify Tenant, however, such notice to Tenant shall in no way
obligate Landlord to install such awnings. If Tenant is so notified, then
Tenant, at Tenant's sole cost and expense, may install one (1) or more awnings,
as permitted by the applicable Legal and Insurance Requirements, to the exterior
of the demised premises, provided that the awnings to be installed by Tenant are
in accordance with the same specifications as the other awnings to be installed
by Landlord, and, provided further that such other awnings are actually
installed. If Tenant decides not to so install such awnings, then Landlord, at
no cost to Tenant, may install such awnings. All awnings that are attached to
the exterior of the demised premises that are installed by Tenant, shall be
maintained, repaired and replaced (if necessary) by Tenant, at Tenant's sole
cost and expense, and all awnings that are attached to the exterior of the
demised premises that are installed by Landlord, shall be maintained, repaired
and replaced (if necessary) by Landlord, at Landlord's sole cost and expense.
47. INDEMNITY-LIABILITY INSURANCE:
47.01 Tenant covenants and agrees to indemnify and save Landlord
harmless from and against any and all claims made against Landlord by
third-parties for damages or injuries to goods, wares, merchandise and property
and/or for any personal injury or loss of life in, upon or about the Demised
Premises, except to the extent such damages, injury or loss of life are caused
by the negligence or intentionally wrongful acts or omissions of Landlord or
Landlord's employees or agents.
47.02 Tenant covenants to provide (or cause to be provided) on or before
the Commencement Date, and to keep in force during the term hereof, the
following insurance coverage:
(i) comprehensive general liability insurance against (A) all claims,
demands or actions for injury to or death of person or property to the limit of
not less than $5,000,000.00 per occurrence and/or in the aggregate, including
independent contractors' coverage, with broad form endorsement, arising from,
related to, or in any way connected with the use or occupancy of the Demised
Premises, or caused by actions or omissions to act, where there is a duty to
act, of Tenant, its agents, servants and contractors, or of any person or entity
claiming by, through or under Tenant, and (B) all accidents occurring in or
about the Demised Premises;
(ii) worker's compensation, disability and such other similar
insurance covering all persons that are performing Changes, and with respect to
whom death or bodily injury claims could be asserted against Landlord or the
Building; and
(iii) fire and extended coverage, vandalism, malicious mischief, water
damage and special extended coverage in an amount adequate to cover the cost of
replacement of all personal property, fixtures, furnishing and equipment located
in the demised premises or which exclusively services the demised premises and
are located outside the demised premises, including all Tenant's Work, Tenant's
Property, Changes and all items that
10
are not the expressed responsibility of Landlord to insure under this lease.
All of said insurance shall be with commercially reasonable deductibles and
shall provide that it shall not be subject to cancellation, termination or
change (except for changes that increase coverage), except upon at least thirty
(30) days' prior written notice to Landlord. All liability insurance coverage
shall cover Landlord, its agents and employees, and, to the extent names and
addresses have been furnished to Tenant, the holders of all superior mortgages
and the lessors under all superior leases as named additional insureds, all of
whom shall be additional named insureds. All insurance policies shall be written
by good and solvent insurance companies authorized to do business in the State
of New York, and having a rating in A.M. Best's Guide of A-VII or higher (or a
comparable or higher rating issued by another nationally recognized rating
organization). Such insurance may be carried under a blanket policy covering the
Demised Premises and other locations of Tenant, if any.
47.03 Prior to the time such insurance is first required to be carried
by Tenant and thereafter, at least thirty (30) days prior to the expiration of
any such policy, Tenant agrees to deliver to Landlord either a duplicate
original of the aforesaid policies or a certificate evidencing such insurance.
Within ten (10) days after Landlord's request, Tenant shall also deliver to
Landlord evidence of payment for the policy.
47.04 Within thirty (30) days after Landlord's demand therefor, Tenant
shall pay to Landlord, as Additional Rent, the amount charged by Landlord's
insurance carrier, as evidenced by an invoice or ▇▇▇▇ furnished by Landlord's
insurance carrier or insurance agent or broker, for Landlord's rent insurance,
in an amount equal to the Fixed Rental and Additional Rent that would have been
due under this lease for the twelve (12) month period following any casualty.
47.05 Landlord covenants and agrees to indemnify and save Tenant
harmless from and against any and all claims made against Tenant by
third-parties for damages or injuries to goods, wares, merchandise and property
and/or for any personal injury or loss of life outside the demised premises (but
on the Land or in the Building), except to the extent such damages, injury or
loss of life are caused by the negligence or intentionally wrongful acts or
omissions of Tenant or Tenant's employees or agents.
47.06 Owner's sole obligation and liability with respect to maintaining
insurance coverage on or with respect to the demised premises or the Building
shall be to procure and maintain (a) fire and extended coverage, vandalism,
malicious mischief, water damage and special extended coverage insurance on the
Building (exclusive of foundations and footings and exclusive of all of the
items described in subsection 47.02(iv) above), in an amount equal to the full
replacement cost thereof, and (b) comprehensive general liability insurance in
such form and amounts that are carried by prudent owners of buildings in New
York City that are comparable to the Building. All of said insurance shall be
with commercially reasonable deductibles and shall provide that it shall not be
subject to cancellation, termination or change (except for changes that increase
coverage), except upon at least thirty (30) days' prior written notice to
Tenant. All liability insurance coverage shall cover Tenant, its agents and
employees, all of whom shall be additional named insureds. All insurance
policies shall be written by good and solvent insurance companies authorized to
do business in the State of New York, and having a rating in A.M. Best's Guide
of A-VII or higher (or a comparable or higher rating issued by another
nationally recognized rating organization). Such insurance may
11
be carried under a blanket policy covering the Building and other locations of
Landlord, if any. At least thirty (30) days prior to the expiration of any such
policy, Landlord agrees to deliver to Tenant either a duplicate original of the
aforesaid policies or a certificate evidencing such insurance. Within ten (10)
days after Tenant's request, Landlord shall also deliver to Tenant evidence of
payment for the policy.
48. WAIVER OF SUBROGATION:
48.01 Each party hereby releases the other party (which term as used in
this Article includes the employees, agents, officers and directors of the other
party) from all liability, whether for negligence or otherwise, in connection
with loss covered by any fire and/or extended coverage insurance policies, which
the releasor carries with respect to the Demised Premises, or any interest or
property therein or thereon (whether or not such insurance is required to be
carried under this lease), but only to the extent that such loss is collected
(or would have been collected had the required insurance been carried) under
said fire and/or extended coverage insurance policies. Such release is also
conditioned upon the inclusion in the policy or policies of a provision whereby
any such release shall not adversely affect said policies, or prejudice any
right of the releasor to recover thereunder. Each party agrees that its
insurance policies aforesaid will include such a provision so long as the same
shall be obtainable without extra cost, or if extra cost shall be charged
therefor, so long as the party for whose benefit the clause or endorsement is
obtained shall pay such extra cost. If extra cost shall be chargeable therefor,
each party shall advise the other thereof of the amount of the extra cost, and
the other party at its election may pay the same, but shall not be obligated to
do so.
49. LANDLORD'S WORK; AS-IS POSSESSION:
49.01 (a) Landlord shall perform the work (hereinafter called
"Landlord's Work") described in Exhibit F annexed hereto (which by this
reference is made a part hereof), at Landlord's sole cost and expense (except as
provided below), and shall "substantially complete" (as hereinafter defined) the
same with reasonable dispatch. Landlord represents to Tenant that to the best of
Landlord's knowledge, as of the date of this lease, Landlord has been issued all
building permits that are necessary to perform to completion all Landlord's
Work; provided, however, that such representation shall in no way be deemed a
warranty or guarantee that said building permits will remain in effect. For all
purposes hereof, Landlord shall be deemed to substantially complete Landlord's
Work when the only items thereof remaining to be performed are so-called
"punch-list" items, the non-completion of which do not materially interfere with
the performance of the Tenant's Work or Tenant's use of the demised premises,
and the "Substantial Completion Date" shall mean the date on which the Phase I
Landlord's Work (as defined in said Exhibit F) is substantially completed.
Landlord shall give Tenant at least thirty (30) days prior notice (a "Delivery
Notice") of the date (the "Anticipated Delivery Date") on which Landlord
anticipates the Substantial Completion Date to occur. Any discrepancy between
the Anticipated Delivery Date and the actual Substantial Completion Date shall
be of no consequence to Landlord. Within a reasonable period of time after the
Commencement Date, Landlord shall complete all of such punch-list items not
theretofore completed, and in so completing the such punch-list items shall use
reasonable efforts to minimize interference with Tenant's Work.
(b) If the Substantial Completion Date shall not have occurred by
May 25, 1996 (which date, as used in this Section
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49.01, shall be extended by the number of days that the Substantial Completion
Date has not occurred by reason of any delays caused by Tenant or any person or
entity claiming by, through or under Tenant (including, without limitation,
Tenant's employees, agents and contractors) or for any of the reasons described
in Article 26 above, provided, however, that such extension for any of the
reasons described in said Article 26 shall not exceed ninety (90) days), then
Tenant shall receive a credit against the Fixed Rental first payable under this
lease after the Free Rent Period in the Overtime Credit Amount (as such term is
defined in Subsection 49.01(e) below). No interest shall accrue or shall be
payable on the Overtime Credit Amount.
(c) (i) If the Substantial Completion Date shall not have
occurred by July 11, 1996 (which date, as used in this Section 49.01) shall be
extended by the number of days that the Substantial Completion Date has not
occurred by reason of any delays caused by Tenant or any person or entity
claiming by, through or under Tenant (including, without limitation, Tenant's
employees, agents and contractors) or for any of the reasons described in
Article 26 above, provided, however, that such extension for any of the reasons
described in said Article 26 shall not exceed ninety (90) days), then (A) Tenant
shall receive a credit against the Fixed Rental first payable under this lease
after the Free Rent Period, and in addition to the Overtime Credit Amount, the
Inventory Credit Amount (as such term is defined in subsection 49.01(e) below,
and (B) Tenant, at Tenant's election (but without any obligation so to do), may
complete all of Landlord's Work (and not just the Phase I Landlord's Work). (No
interest shall accrue or be payable on the Inventory Credit Amount.) To elect to
complete the Landlord's Work, Tenant shall give Landlord notice thereof (the
"Election Notice") within six (6) months after July 11, 1996 (as such date may
be so extended) (TIME BEING OF THE ESSENCE). If Tenant so elects to complete the
Landlord's Work, Tenant shall perform, complete and pay for same, promptly and
with due diligence, and in accordance with the applicable provisions of this
lease as if such performance and completion were a Change. If Tenant so elects
to complete the Landlord's Work, then, as required by Sections (a), (b), (c) of
Article 3 above, Landlord's consent shall be deemed given for all Landlord's
Work; contrary to the requirements of Section (e) of Article 3, Tenant shall not
be required to pay for the preparation or review of the plans and specifications
(if any) for the Landlord's Work; and Tenant shall not be required to revise the
"as-built" plans and specifications for the Building to reflect the completion
of Landlord's Work. Provided Tenant has commenced and is so performing the
Landlord's Work, Landlord shall have no right to resume the completion of
Landlord's Work. For the purposes of this subparagraph (c), the "cost of
completing the Landlord's Work" shall equal the cost, to the extent reasonably
incurred by Tenant, of so performing and completing the Landlord's Work pursuant
to this subparagraph (c), and "Landlord's Work Reimbursement Notice" shall mean
a notice in which Tenant sets forth, in reasonable detail, the items which
comprise the cost of completing Landlord's Work.
(ii) Except as otherwise expressly provided in this subsection (ii),
(A) Landlord shall pay to Tenant the cost of completing the Landlord's Work on
or before the date (the "Reimbursement Date") which is the later of (1) the date
which is thirty (30) days after Landlord's receipt of the Landlord's Work
Reimbursement Notice, and (2) the date next succeeding the Free Rent Period, and
(B) if Landlord fails to pay the cost of completing the Landlord's Work on or
before the Reimbursement Date, Tenant shall receive a credit against the Fixed
Rental first payable under this lease after the Free Rent Period an in addition
to the Overtime Credit Amount and the Inventory Credit Amount, in the amount of
the cost of completing the Landlord's
13
Work, plus interest accruing on the outstanding balance thereof, from the
Reimbursement Date, at an annual rate of interest equal to two (2%) percent over
the prime rate of Chase Manhattan Bank, N.A. (or its successor) during the
period of repayment. Such credits shall be applied first against the cost of
completing the Landlord's Work, and then against such interest. If Tenant
performs any Landlord's Work in accordance with, and subject to, the provisions
of this subparagraph (c), then the Landlord's Work Reimbursement Notice shall be
conclusive and binding upon Landlord, unless within thirty (30) days after the
later of (x) the date on which Landlord receives the Landlord's Work
Reimbursement Notice, and (y) the date on which Landlord receives the bills,
invoices, receipts and other information or documentation reasonably required by
Landlord as hereinafter provided, Landlord shall notify Tenant that Landlord
disputes the correctness thereof, specifying the particular respects in which
the Landlord's Work Reimbursement Notice is incorrect. Tenant shall grant to
Landlord reasonable access to Tenant's books and records for the purpose of
verifying the cost of completing the Landlord's Work as set forth in the
Landlord's Work Reimbursement Notice and shall, within thirty (30) days after
Landlord's request therefor, submit to Landlord bills, invoices, receipts and
any other information or documentation reasonably required by Landlord to verify
the cost of completing the Landlord's Work as set forth in the Landlord's Work
Reimbursement Notice. If Landlord and Tenant fail to settle such dispute within
ninety (90) days after Landlord so notifies Tenant, such dispute shall be
determined by arbitration pursuant to Article 68 hereof. Pending the settlement
of such dispute by agreement between Landlord and Tenant or by arbitration as
aforesaid, Landlord shall not be obligated to pay to Tenant the lesser of (1)
$750,000.00, and (2) fifty (50%) percent of the portion of the cost of
completing the Landlord's Work that Landlord has reasonably and in good faith
disputed, and Tenant shall not be entitled to reduce the Fixed Rental with
respect thereto. If as a result of such arbitration it is determined that the
portion of the cost of completing the Landlord's Work paid by Landlord (or being
paid by Landlord in the form of a Fixed Rental credit) is less than the amount
owed by Landlord, then the underpayment (plus accrued interest at the rate set
forth in this subsection (ii)) shall, at Landlord's option, be paid to Tenant
within thirty (30) days after the arbitration decision is rendered and received
by Landlord, or be added to the Fixed Rental credit. If as a result of such
arbitration it is determined that the portion of the cost of completing the
Landlord's Work paid by Landlord (or being paid by Landlord in the form of a
Fixed Rental credit) is more than the amount owed by Landlord, then the
overpayment, to the extent paid by Landlord (plus the interest thereon at the
rate set forth in this subsection (ii)), shall be refunded by Tenant to Landlord
within thirty (30) days after the arbitration decision is rendered and received
by Tenant. To the extent such overpayment has not yet been paid by Landlord, the
Fixed Rental credit shall be reduced by such overpayment, plus all interest that
accrued on such overpayment.
(d) If the Substantial Completion Date shall not have occurred by
the last day of the six (6) month period described in clause (B) of subsection
47.01(c)(i) above, and Tenant has not given Landlord the Election Notice by the
last day of such six (6) month period, TIME BEING OF THE ESSENCE, then Tenant
shall be deemed to have irrevocably waived its right to any portion of the
Overtime Credit Amount or the Inventory Credit Amount, or to complete the
Landlord's Work, and this lease shall be deemed terminated effective on the last
day of such six (6) month period, and Landlord and Tenant shall be relieved and
released from all of their obligations and liabilities hereunder and this lease
shall be deemed terminated and of no force or effect.
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Notwithstanding the foregoing, the provisions of Article 54 of this lease shall
survive such termination.
(e) For purposes of this Article 49:
(i) The term "Overtime Credit Amount" shall mean the actual,
direct, out-of-pocket cost paid by Tenant to its contractors or subcontractors
for over-time labor and to accelerate fabrications, both pursuant to the terms
of the contracts and subcontracts between Tenant and such contractors or
subcontractors, respectively, in order to substantially complete Tenant's Work
by December 10, 1996 (or, at Tenant's option, before December 10, 1996, but no
earlier than October 10, 1996, but only to the extent that such overtime labor
or acceleration is reasonably necessary to recoup lost construction time for
Tenant that directly results from Landlord failing to substantially complete the
Phase I Landlord's Work by May 25, 1996. After the substantial completion of
Tenant's Work and Tenant's opening for business to the public, Tenant shall send
to Landlord a written notice (the "Overtime Charge Notice") setting forth in
reasonable detail the Overtime Credit Amount and Tenant's computation of the
Tenant's Work, together with evidence of the normal charges to Tenant without
any overtime charges, the rate by which overtime charges exceed normal charges
on a contractor by contractor or subcontractor by subcontractor basis, and a
certification by the relevant contractors and/or subcontractors of the amount of
hours or other measurement to which such overtime rate shall be applicable.
Tenant shall grant Landlord and cause Tenant's general contractor or
construction manager to grant Landlord, access, upon prior notice, to its and
their books and records to verify the information to be contained in the
Overtime Charge Notice. If Landlord disputes Tenant's computation or any other
information as set forth in the Overtime Charge Notice, it shall notify Tenant
thereof within thirty (30) days after its receipt of the Overtime Charge Notice,
and if Landlord and Tenant fail to agree on the Overtime Credit Amount within
ninety (90) days after Landlord sends such notice of dispute to Tenant, either
party may submit such dispute for determination by arbitration pursuant to the
provisions of Article 68 hereof;
(ii) The term "Inventory Credit Amount" shall mean a dollar
amount per day during the period (the "Inventory Credit Period") commencing on
July 11, 1996 (as such date may be extended pursuant to subparagraph 49.01(c)(i)
above) and ending on the earlier of (A) the date next preceding the Substantial
Completion Date, and (B) the date that is seventy-four (74) days after the first
(1st) day of such period, which dollar amount shall equal $3,250.00 per day for
the first twenty-five (25) days of the Inventory Credit Period, $4,250.00 per
day for the next twenty-five (25) days of the Inventory Credit Period, and
$5,250.00 per day for the last twenty-five (25) days of the Inventory Credit
Period, for a maximum Inventory Credit Amount of $318,750.00; and
(iii) Pending the settlement of the dispute (if any) regarding the
Overtime Credit Amount, by agreement between Landlord and Tenant or by
arbitration as set forth in subsections (i) or (ii) above, the Fixed Rental
credit to which Tenant would otherwise be entitled shall be reduced by fifty
(50%) percent of the portion of the Overtime Credit Amount that Landlord has
reasonably and in good faith disputed. If as a result of such agreement or
arbitration it is determined that the Overtime Credit Amount, after taking into
15
account such fifty (50%) percent reduction, is less than the amount owed by
Landlord, then the deficiency shall be added to the Fixed Rental credit (without
interest). If as a result of such agreement or arbitration it is determined that
the Overtime Credit Amount, after taking into account such fifty (50%) percent
reduction, is more than the amount owed by Landlord, then such excess shall be
paid to Landlord (without interest, except to the extent not paid within the
thirty (30) day period set forth below), to the extent same has already been
credited against Fixed Rental) or shall reduce the Fixed Rental credit (to the
extent that such excess has not been credited against the Fixed Rental). Such
payment shall be paid to Landlord, as Additional Rent, within thirty (30) days
after Landlord's demand therefor.
(f) Except as otherwise expressly provided in this Section 49.01,
Landlord shall have no liability to Tenant and Tenant shall have no rights or
remedies in the event Landlord fails or is unable to substantially complete the
Landlord's Work by any of the dates set forth in this Section 49.01 or in
Exhibit F annexed hereto.
(g) If any of the events or circumstances described in Article 26
of this lease occur, and Tenant, at no unreasonable cost, expense or material
interference or inconvenience to Owner, can minimize or eliminate the delay
caused thereby, Owner shall cooperate with Tenant in so minimizing or
eliminating the delay that would otherwise be caused thereby.
(h) Landlord shall use reasonable efforts to perform all
Landlord's Work and all other work in or to the Building (and to have all
Landlord's Work and such other work performed) so as to minimize interference
with the use and operation of the demised premises.
49.02 Tenant acknowledges that it has made a full and complete
inspection of the Demised Premises and, except for the Landlord's Work, Tenant
agrees to accept same on the Commencement Date subject to all violations
(whether or not of record) to the extent that such violations do not materially
interfere with the performance or completion of Tenant's Work, the issuance of
the temporary certificate of occupancy described in Section 49.03 below, or the
use or occupancy by Tenant of the demised premises for the uses expressly
permitted under this lease, unless such violations resulted from the acts or
omissions of Tenant or any person or entity claiming by, through or under
Tenant, and in its present "as is" condition but, subject to any repair
obligations expressly contained in this lease on Landlord's part to perform.
Except as may otherwise be expressly set forth in this lease, Tenant
acknowledges that Landlord, or Landlord's agent, has made no representations or
promises in regard to the Demised Premises for the term herein demised. The
taking of possession of the Demised Premises by Tenant for the term herein
demised shall be conclusive evidence as against Tenant that the Demised Premises
were in the condition required by this lease.
49.03 All Changes that Tenant desires to perform to prepare the demised
premises for its initial occupancy (such Changes being herein referred to as
"Tenant's Work") shall be performed by Tenant, at Tenant's sole cost and expense
(except as otherwise expressly set forth in Section 50.04 below), and in
accordance with, and subject to Articles 3 and 45 and the other applicable
provisions of this lease. In addition, Tenant, at Tenant's sole cost and expense
and as part of Tenant's Work, shall install or provide for handicapped access to
the demised premises (in compliance with applicable Legal and Insurance
Requirements) and obtain a temporary certificate of occupancy for the Building
that will permit the demised premises to be used for retail purposes. Landlord
shall have no liability whatsoever, and Tenant's obligations and liabilities
under this lease shall not be affected in any way whatsoever, in the event that
Tenant is unable to obtain such temporary certificate of occupancy, unless such
inability results from any default by Landlord of any
16
of the terms, covenants or conditions in this lease on Landlord's part to
observe, perform or comply with. To the extent that Landlord's default delays
the issuance of such temporary certificate of occupancy, Tenant's sole right and
remedy shall be a one (1) day extension of the Free Rent Period for each day
that such issuance is so delayed, but only if Tenant has given Landlord prompt
notice of such default and of Tenant's belief that such default is causing such
delay. (For the purposes of clarification, such extension shall be in addition
to the other Fixed Rental credits to which Tenant may be entitled pursuant to
certain other expressed provisions of this lease.) Within five (5) business days
after such temporary certificate of occupancy is issued, Tenant shall deliver
the original thereof to Landlord. Thereafter, Landlord, at Landlord's sole cost
and expense, shall extend or renew such temporary certificate of occupancy until
such time (if ever) that a final certificate of occupancy for the Building is
issued. Landlord and Tenant shall not (and each shall cause all persons and
entities, claiming by, through or under Landlord and Tenant, respectively, not
to) violate any certificate of occupancy for the Building or commit or permit
anything to be done that would prevent the extension or renewal of such
temporary certificate of occupancy.
50. HEATING, VENTILATING AND AIR-CONDITIONING:
50.01 The Demised Premises shall be serviced by one or more separate
heating, ventilating and air-conditioning systems and/or units (collectively,
the "HVAC Unit"), to be installed by Tenant, at its expense. The HVAC Unit and
all facilities, equipment, machinery and ducts installed in connection therewith
shall be operated by Tenant at Tenant's sole cost and expense. The HVAC Unit and
all facilities, equipment, machinery and ducts installed in connection with the
HVAC Unit shall be installed solely within the Demised Premises, except for the
chiller equipment for the HVAC Unit and the boiler equipment for the HVAC Unit,
which shall be installed, respectively, on the roof of the Building and in the
subcellar of the Building, in locations to be reasonably designated by Landlord.
To the extent the HVAC Unit and any such facilities, equipment, machinery and
ducts are so installed outside the demised premises, Landlord shall grant Tenant
access (or cause Tenant to be granted access) to such areas outside the demised
premises, upon prior reasonable notice to Landlord and at reasonable times, for
the sole purpose of installing, maintaining, repairing or replacing, if
necessary, the HVAC Unit or such facilities, equipment, machinery or ducts,
provided that Tenant uses reasonable efforts, both in the manner in which such
work is performed and in the times such work is performed, to minimize
interference with the use and occupancy of the Building by others. As a
condition to such access, Tenant hereby agrees that Landlord may require that
regular or normal maintenance and repairs (as opposed to emergency repairs)be
performed only between the hours of 9:00 A.M. and 5:00 P.M. on business days. In
addition to all of Landlord's other rights and remedies, in the event that any
such work unreasonably interferes with the use and occupancy of the Building by
others, Landlord may notify Tenant thereof (either orally or in writing), in
which event Tenant shall immediately stop such work, until same can be performed
in a manner and at such times that will not result in such unreasonable
interference. All facilities, equipment, machinery and ducts installed in
connection with the HVAC Unit shall (a) be installed in accordance with, and
subject to, Articles 3 and 45 and the other applicable provisions of this lease,
and (b) to the extent installed outside the demised premises, comply with
Landlord's reasonable requirements as to installation, maintenance, repair and
operation.
50.02 Tenant shall, at its expense, properly and continuously maintain,
repair and cause any and all replacements
17
of the HVAC Unit and all facilities, equipment, machinery and ducts installed in
connection therewith. Tenant's obligation to maintain the HVAC Unit shall
include, but not be limited to, the periodic cleaning and/or replacement of
filters, replacement of fuses and belts, the calibration of thermostats and all
startup and shut down maintenance of the HVAC Unit. Such maintenance obligations
shall be performed throughout the term of this lease, on Tenant's behalf, by a
reputable air-conditioning maintenance company engaged by Tenant at its expense.
In the event Tenant shall fail to engage an air-conditioning maintenance company
as aforesaid, and such failure shall continue for thirty (30) days after notice
of such failure is given to Tenant, then, notwithstanding anything contained in
this lease which may be deemed to the contrary, and in addition to all of
Landlord's other rights and remedies, Landlord may (but shall not be obligated
to) perform such maintenance and/or engage an air-conditioning service company
at Tenant's expense to perform the aforesaid maintenance to the HVAC Unit, and
Tenant shall pay as Additional Rental hereunder, within fifteen (15) days after
Landlord's demand therefor, all expenses incurred by Landlord in connection
therewith, which demand shall be accompanied by reasonable substantiating
evidence of such expenses. All electricity used in connection with the operation
of the HVAC Unit and all blowers, fans, chilling equipment and other facilities
and equipment utilized in connection therewith shall be supplied subject to, all
of the terms, covenants and conditions contained in Article 43 hereof. Tenant
shall surrender the HVAC Unit and all repairs, additions and replacements
thereto and thereof to Landlord in good working order and condition on the
expiration or sooner termination of this lease.
50.03 Landlord shall permit Tenant to obtain fresh air intake from the
Building's exterior louvre intake ducts installed and designated by Landlord and
all connections thereto shall be at Tenant's sole cost and expense and subject
to the provisions of Articles 3 and 45 hereof.
50.04 (a) Landlord agrees to pay to Tenant, as hereinafter provided, an
amount (the "HVAC Reimbursement") equal to the lesser of (i) $173,856.00 and
(ii) the costs actually paid by Tenant to purchase and install the HVAC Unit.
(b) The HVAC Reimbursement shall be paid by Landlord to Tenant
within thirty (30) days after the following conditions have been met:
(i) The HVAC Unit has been installed substantially in accordance
with the plans and specifications theretofore approved by Landlord, and
otherwise in accordance with, and subject to, all of the applicable provisions
of this lease;
(ii) The Commencement Date shall have occurred (unless the
Commencement Date is based on the giving of the Election Notice in which event
the condition of this subsection (ii) shall be that the Free Rent Period has
expired);
(iii) Tenant is not in default of any of the terms, covenants or
conditions of this lease on Tenant's part to observe, perform or comply with;
and
(iv) Tenant shall have submitted to Landlord, upon such
completion of such installation, the following:
(w) contractors' paid receipted invoices for all work done,
and for all materials and supplies furnished in connection with such
installation;
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(x) a certificate from Tenant's architect certifying that
such installation has been fully completed, and was performed and completed
substantially in accordance with the plans and specifications theretofore
approved by Landlord ;
(y) lien waivers and general releases from each contractor,
and subcontractor that performed work in connection with such installations, to
the extent of the amount paid to such parties, and affidavits, in form and
content reasonably satisfactory to both Landlord and Tenant, from each such
contractor and subcontractor, to the effect that such party has been paid in
full for all of such work; and
(z) a written request for the HVAC Reimbursement.
(c) If Landlord fails to pay the HVAC Reimbursement within said thirty
(30) day period, then, in addition to any other reductions of Fixed Rental to
which Tenant is expressly entitled under this lease, the next succeeding monthly
installments of Fixed Rental payable under this lease (after the aforesaid other
reductions, if any) shall be reduced by the then outstanding balance of the HVAC
Reimbursement, plus interest thereon at the fluctuating annual rate described in
subsection 52.02(b)(ii) (but not to an amount which is less than one ($1.00)
dollar per month) until such time as, and to the extent that, the amount of
Fixed Rental that would have been payable under this lease (but for such
reduction) equals the HVAC Reimbursement. Such reductions shall be applied first
against the outstanding balance of the HVAC Reimbursement, and then against such
interest.
50.05 Tenant hereby acknowledges that except for the freight elevator
service described in Article 60 below and for permitting Tenant to obtain fresh
air intake pursuant to Section 50.03 above, Landlord is not obligated to provide
Tenant or the demised premises with electricity, gas, water, heat, ventilation,
air-conditioning, elevator or any other service or utility.
51. NOTICE TO LESSORS AND MORTGAGEES; ATTORNMENT:
51.01 In the event of any default by 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 (i) until it has given written notice of such default to the holder
of each superior mortgage and the lessor of each superior lease whose name and
address shall previously have been furnished to Tenant in writing and (ii)
unless such default shall be one that is not capable of being remedied by
Landlord or such holder or lessor within ninety (90) days after such holder's or
lessor's receipt of such notice , until a reasonable period for remedying such
default shall have elapsed following the giving of such notice and following the
time when such holder or lessor shall have become entitled under such superior
mortgage or superior 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), provided that, within such ninety (90) day period, such holder or
lessor shall give Tenant written notice of its intention to remedy such act or
omission and shall, with due diligence, commence and continue to do so to
completion. For the purposes of clarification, this Section 51.01 shall not
apply to the termination of this lease pursuant to subsection 49.01(d) above.
The leases to which this lease is subject and subordinate pursuant to Article 7
hereof are hereinafter sometimes referred to as "superior leases" and the
19
mortgages to which this lease, is subject and subordinate pursuant to Article 7
hereof are hereinafter sometimes referred to as "superior mortgages".
51.02 If the lessor of a superior lease or the holder of a superior
mortgage shall succeed to the rights of Landlord under this lease, whether
through possession or foreclosure action or delivery of a new lease or deed or
pursuant to the terms thereof, then, at the request of the party so succeeding
to Landlord's rights (herein sometimes called the successor landlord) and upon
such successor landlord's written agreement to accept Tenant's attornment,
Tenant shall attorn to and recognize such successor landlord as Tenant's
landlord under this lease, and shall promptly execute and deliver any instrument
that such successor landlord may reasonably request to evidence such attornment.
Upon such attornment, this lease shall continue in full force and effect as, or
as if it were, a direct lease between the successor landlord and Tenant, upon
all of the terms, conditions and covenants as are set forth in this lease and
shall be applicable after such attornment, except that the successor landlord
shall not:
(i) be liable for any previous act or omission of Landlord under
this lease, except for acts or omissions in breach of Landlord's obligations
hereunder, with respect to which acts or omissions such successor landlord shall
not be relieved of its obligations from and after the date on which it shall
succeed as Landlord hereunder;
(ii) be subject to any offset, not expressly provided for in this
lease, that shall have theretofore or thereafter accrued to Tenant against
Landlord; or
(iii) be bound by any previous modification of this lease, not
expressly provided for in this lease, or by any previous prepayment of more than
one month's Fixed Rental or any Additional Rent then due (except for monthly
payments on account of Additional Rent required or permitted hereunder), unless
such modification or prepayment shall have been expressly approved in writing by
the lessor of the superior lease or the holder of the superior mortgage through,
or by reason of which, the successor landlord shall have succeeded to the rights
of Landlord under this lease.
51.03 (a) Notwithstanding anything contained in this Article 7 to the
contrary, but provided that the Tenant named herein or a Related Entity (as
defined in Section 65.15 below) is the then Tenant hereunder, and such Tenant
then occupies for its own account at least seventy-five (75%) percent of the
rentable area of the demised premises, this lease shall not be subject and
subordinate to a superior mortgage or to a superior lease unless Landlord
obtains and delivers to Tenant a Subordination, Non-Disturbance and Attornment
Agreement (hereinafter referred to as an "SNDA") for the benefit of Tenant from
the holder of such superior mortgage and from the lessor under such superior
lease, which SNDA shall be in form and content then utilized by such holder or
lessor, but which shall contain, in substance, clauses (i), (ii) and (iii) of
Section 51.02 above and an agreement from the holder of a superior mortgage or
lessor under a superior lease, for the benefit of Tenant, to the effect, inter
alia, that as long as Tenant is not in default in the payment of Fixed Rental or
Additional Rent or any other term, covenant or condition of this lease, beyond
any applicable notice and cure period and provided Tenant attorns to such holder
or lessor under the terms and provisions of this lease, (1) Tenant's rights as
Tenant hereunder shall not be affected or terminated, (2) its possession of the
demised premises shall not be disturbed, (3) no action or proceeding shall be
commenced to remove or evict
20
Tenant, and (4) this lease, shall at all times, continue in full force and
effect notwithstanding the foreclosure of the superior mortgage (or deed-in-lieu
thereof) or the termination or expiration of the superior lease prior to the
expiration or termination of this lease. Notwithstanding anything contained in
this subsection (a) to the contrary, if Landlord is unable to obtain or deliver
to Tenant an SNDA for the benefit of such Tenant because such Tenant is in
default under this lease, then this lease shall nevertheless be subject to all
superior mortgages and to all superior leases.
(b) If the Tenant named herein or a Related Entity is not the
then Tenant, then this lease shall be subject and subordinate to all prospective
superior mortgages and all prospective superior leases, as more particularly
provided in Article 7 above and in this Article 51, even if Landlord has not
obtained or delivered an SNDA for the benefit of Tenant from any such holder or
lessor despite using its best efforts, as hereinafter provided. Notwithstanding
the foregoing, but provided such Tenant then occupies for its own account at
least seventy-five (75%) percent of the rentable area of the demised premises,
and Landlord has not given to Tenant a default notice for a default that remains
uncured, Landlord shall use its best efforts to obtain and deliver an SNDA for
the benefit of Tenant for the holder of each superior mortgage and from the
lessor under each superior lease. For the purposes of this subsection (b), "best
efforts" shall mean an obligation to use reasonable commercial efforts, and
shall not be interpreted to require Landlord to enter into any agreement or
undertaking to pay or otherwise confer or to actually pay or otherwise confer
anything of value to or for the benefit of a third-party (including, without
limitation, such holder or lessor), to guarantee any obligation, or to otherwise
modify any of its obligations under such superior mortgage or superior lease.
Landlord's failure or inability to obtain or deliver to Tenant an SNDA (despite
using such best efforts) shall not be a default by Landlord and shall not
entitle Tenant to exercise any rights or remedies whatsoever or otherwise affect
Tenant's obligations under this lease.
52. FURTHER PROVISIONS AS TO DEFAULT:
52.01 (i) If Tenant is late in making any payment due to Landlord from
Tenant under this lease for ten (10) or more days, then Tenant shall pay
Landlord within ten (10) days after Landlord's demand therefor, as Additional
Rental, Landlord's reasonable and actual out-of-pocket third-party costs and
expenses (up to $1,000.00 for each late payment) in attempting to collect such
late payment. Such obligation to pay said costs and expenses, and such $1,000.00
limitation, shall apply only to such late payments and only through the giving
to Tenant of the first default notice for a particular late payment. Tenant's
obligation to pay Landlord's costs and expenses in respect of all of Tenant's
other defaults, and in respect of exercising any or all of its other rights and
remedies with respect to the late payment in question, including, without
limitation, the giving of any amended or subsequent default notices, shall be
governed by the other applicable provisions of this lease, including, without
limitation, Articles 17, 18 and 19 above, and Section 52.02 below.
(ii) In the event that any payment due to Landlord from Tenant under
this lease shall not be paid by Tenant within fifteen (15) days of the date such
payment was due (including any late payment referred to in subsection (i)
above), then interest shall become due and owing to Landlord on such payment, as
Additional Rental, from the date upon which it was due, which interest shall be
computed at the greater of (1) one and 25/100 (1.25%) percent per month or (2)
two (2%) percent per annum over
21
the then prime rate of Chase Manhattan Bank, N.A. (or its successor), but in no
event in excess of the maximum lawful rate of interest chargeable to
corporations in the State of New York.
52.02 (a) Bills for any reasonable expenses incurred by Landlord in
connection with any performance by it for the account of Tenant, if and to the
extent such performance is expressly permitted under this lease or pursuant to
applicable law, and bills for all reasonable out-of-pocket costs, expenses and
disbursements of every kind and nature whatsoever, including reasonable counsel
fees, involved in collecting or endeavoring to collect the Fixed Rental or
Additional Rent or any part thereof or enforcing or endeavoring to enforce any
rights against Tenant, under or in connection with this lease, or pursuant to
law, or in defending any action or proceeding brought by Tenant under this
lease, provided Landlord is the prevailing party, including any such reasonable
out-of-pocket cost, expense and disbursement involved in instituting and
prosecuting summary proceedings, as well as bills for any property, material,
labor, or services provided, furnished, or rendered, by Landlord or at its
instance to Tenant, may be sent by Landlord to Tenant monthly, or immediately,
at Landlord's option, and shall be due and payable in accordance with the terms
of such bills.
(b) (i) If Landlord shall be in breach of any of Landlord's
obligations under this lease, and if Tenant, as a result thereof, shall make any
reasonable out-of-pocket payments for court costs and reasonable attorneys'
fees, in instituting or prosecuting or defending any action or proceeding or in
the event Tenant shall make any such expenditures in connection with any action
or proceeding brought by Landlord under this lease, then, provided that Tenant
shall be the prevailing party in any such action or proceeding, Landlord shall
reimburse or pay Tenant for such reasonable costs and fees actually paid by
Tenant in connection with such action or proceeding.
(ii) In the event that any payment due to Tenant from
Landlord under this lease shall not be paid by Landlord within fifteen (15) days
of the date such payment was due, then interest shall become due and owing to
Tenant on such payment from the date upon which it was due, which interest shall
be computed at the greater of (1) one and 25/100 (1.25%) percent per month or
(2) two (2%) percent per annum over the then prime rate of Chase Manhattan Bank,
N.A. (or its successor), but in no event in excess of the maximum lawful rate of
interest chargeable to corporations in the State of New York. Notwithstanding
the foregoing, such interest shall not be payable by Landlord for payments that,
pursuant to the applicable provisions of this lease, are expressly stated as not
to accrue interest or are to accrue interest at a different rate or in a
different manner.
52.03 Notwithstanding anything contained in this lease which may be
deemed to the contrary, Tenant shall not be liable for any consequential damages
incurred or paid by Landlord as a result of Tenant's failure to observe, perform
or comply with any of the terms, covenants or conditions in this lease on
Tenant's part to observe, perform or comply with, and Landlord shall not be
liable for any consequential damages incurred or paid by Tenant as a result of
Landlord's failure to observe, perform or comply with any of the terms,
covenants or conditions in this lease on Landlord's part to observe, perform or
comply with.
53. OPERATING COVENANTS:
53.01 Cleaning: The entire Demised Premises, including store fronts and
any glass show windows (inside and out), are to be kept clean by Tenant, at its
sole cost and expense, in a manner reasonably satisfactory to Landlord, except
that on the
22
Commencement Date the demised premises shall be in broom-clean condition.
53.02 Removal of Garbage: Tenant shall comply with all applicable Legal
and Insurance Requirements (including, without limitation, recycling programs)
related to the handling and treatment of its rubbish, refuse and waste and the
rubbish, refuse and waste of all persons and entities claiming by, through or
under Tenant. Tenant shall accumulate (or cause to be accumulated) all such
rubbish, refuse and waste for collection in concealed metal containers in
locations reasonably designated by Landlord. Tenant further agrees not to permit
the accumulation (unless in concealed metal containers) of any rubbish, refuse
or waste in, on or about any part of the Demised Premises. Landlord shall
arrange for the regular carting away from the Building of all such rubbish,
refuse and waste, using the same carting service that carts away Landlord's
rubbish, refuse and waste. Tenant shall pay to Landlord, as Additional Rent and
within thirty (30) days after Landlord's demand therefor from time to time,
Tenant's share of the cost of such carting service, based upon the relative
quantities of rubbish, refuse and waste. Such share shall from time to time be
reasonably determined by Landlord in good faith, but after consultation with
Tenant, and shall be subject to increases and decreases, depending upon changes
in such relative quantities. If Tenant, at any time or from time to time
disputes Landlord's determination, Landlord and Tenant shall endeavor in good
faith to select a mutually acceptable third-party to make such determination for
the time period(s) in question. If Landlord and Tenant cannot so select a
third-party, such dispute shall be determined by arbitration pursuant to Article
68 below. Until such dispute is resolved by arbitration or settled by agreement
between Landlord and Tenant, Tenant shall pay the amount so determined by
Landlord. To the extent that such dispute shall be resolved in Tenant's favor,
Landlord shall refund to Landlord all overpayments to Tenant within thirty (30)
days after Landlord receives notice of such resolution. If it is determined that
Tenant has underpaid, then Tenant shall pay to Landlord such underpayment within
thirty (30) days after Landlord's demand therefor. If Landlord pays such refund,
or Tenant makes such payment, as the case may be, within such thirty (30) day
period, no interest shall accrue or be payable thereon.
53.03 Water Meter: Tenant shall, as part of Tenant's Work, install a
water meter measuring Tenant's water consumption for all purposes, including the
operation of the HVAC Unit. Tenant shall keep said meter and installation
equipment in good working order and repair at Tenant's expense. Tenant shall, at
its sole cost and expense, pay for the water shown on such meters directly to
the utility company or governmental authority furnishing water to the demised
premises.
53.04 No Obstruction: Neither Landlord, nor Tenant shall encumber or
obstruct, or permit to be encumbered or obstructed, any portion of the sidewalk,
entrances or common and public areas of the Building adjacent to or abutting
upon the Demised Premises, except to the extent such encumbrance or obstruction
is necessary and results from Landlord's or Tenant's observance, performance or
compliance with any of the provisions of this lease.
53.05 Deliveries: Tenant agrees that Tenant's deliveries to the Demised
Premises shall be subject to the Rules and Regulations.
53.06 Chemical Extinguishing Devices: Tenant shall, at its sole cost and
expense, install chemical extinguishing devices (such as ansul or equal)
approved by the Fire Insurance Rating
23
Organization and shall, at its sole cost and expense, keep such devices under
service throughout the term of this lease as required by such organization.
53.07 Gas Cut-Off Services; Exhaust To Street: If gas is used in the
Demised Premises, Tenant shall install gas cut-off devices (manual and
automatic). If Tenant's installation requires any exhausts to the street, the
entire installation of such exhaust shall be subject to Landlord's prior written
approval as to the location and esthetics thereof which approval shall not be
unreasonably withheld, delayed or conditioned.
53.08 Operation: (a) Tenant acknowledges that the Demised Premises are
located in a building constituting (or that will constitute) a first-class
hotel. Tenant agrees that it will operate the Demised Premises in a manner
consistent with such a building. Tenant shall not, at any time, use or occupy,
or suffer or permit anyone to use or occupy, the Demised Premises in violation
of the Certificate of Occupancy for the Demised Premises or the Building.
(b) Notwithstanding the designation of the Building as "The ▇▇▇▇▇▇"
or "The Soho Hotel" or any other identifiable name, or any similar or other
designation containing the name "The ▇▇▇▇▇▇" or "The Soho Hotel" or any other
identifiable name, neither Tenant nor any subtenant, concessionaire, licensee,
or any of their respective partners, officers, agents, employees, or affiliates
shall, at any time during the term of this lease, or after the expiration or
sooner termination of the term of this lease, use any name that contains the
name "The ▇▇▇▇▇▇" or "The Soho Hotel" or such other identifiable name in any
form, combination, or manner (including in any advertising), except with the
prior written consent of Landlord in each instance. After the expiration or
sooner termination of the term of this lease, neither Tenant nor any subtenant,
concessionaire, licensee, or any of their respective partners, officers, agents,
employees, or affiliates shall use any name that contains any word(s) referring
to the Building, or state or imply in any advertisement, notice, sign, or
otherwise that it or any of them was connected in any manner with same, or use
any device or set of words that might so indicate, except with Landlord's prior
written consent in each instance. Landlord may at any time or times change any
such name or designation of the Building (except that Landlord shall not name
the Building with the name of a direct competitor of Tenant).
(c) Notwithstanding the designation of the demised premises as a
"J. Crew" store or any other identifiable name, or any similar or other
designation containing the name or logo of "J. Crew" or any other identifiable
name, neither Landlord nor its partners, officers, agents, employees, or
affiliates shall, at any time during the term of this lease, or after the
expiration or sooner termination of the term of this lease, use any name that
contains the name "J. Crew" or such other identifiable name or logo in any form,
combination, or manner (including in any advertising), except with the prior
written consent of Tenant in each instance. After the expiration or sooner
termination of the term of this lease, neither Landlord nor its partners,
officers, agents, employees, or affiliates shall use any name that contains any
word(s) referring to J. Crew, or state or imply in any advertisement, notice,
sign, or otherwise that it or any of them was connected in any manner with same,
or use any device or set of words that might so indicate, except with Tenant's
prior written consent in each instance.
53.09 Installation In Demised Premises: All of Tenant's equipment,
including, without limitation, heating, ventilating, air-conditioning and
exhaust systems (except for necessary
24
exterior duct work and certain related air-conditioning equipment) shall be
installed within the Demised Premises only.
53.10 Continuous Operation: Tenant agrees that, notwithstanding any
other provision of this lease, it will open the demised premises for business to
the public on or before the date which is eighteen (18) months after the
Commencement Date (regardless of how the Commencement Date is determined) (which
eighteen (18) month period shall be extended by one (1) day for each day that
Tenant is delayed in so opening the demised premises by reason of a strike,
labor disruption, weather condition, act of God or other cause beyond Tenant's
reasonable control (other than the unavailability of funds or a determination
that conducting business at the demised premises is no longer desirable),
conduct its business in the entire demised premises under the name of "J. Crew",
or such other name to which the majority of J. Crew (non-outlet) operations is
changed, or the name of an assignee or subtenant under an assignment or sublease
for which Landlord's consent is not required or was given; subject, however, to
all of the terms, covenants and conditions of this lease, and in such consistent
manner therewith and that it will be open for business not less than five (5)
days per week at least eight (8) hours per day, except to the extent any fire or
other casualty, the performance by Landlord or Tenant of any restoration work
after a fire or casualty, the performance by Tenant of any Change, or a strike,
labor disruption, weather condition, act of God or other cause beyond Tenant's
reasonable control (other than the unavailability of funds or a determination
that conducting business at the demised premises is no longer desirable), makes
it impractical to be open for business. In addition, Tenant may close for two
(2) days during any twelve (12) month period for the purpose of taking
inventory.
53.11 Work Stoppages: (a) In connection with any work (including,
without limitation, Tenant's Work) which may be undertaken by or on behalf of
Tenant, Tenant covenants and agrees that prior to and throughout the term of
this lease, it shall not take any action, or dispute, or interfere with the
business of the Landlord or any other tenant or occupant in the Building or with
the rights and privileges of any person(s) lawfully in said Building. Without
intention to limit the generality of the foregoing in any respect, Tenant agrees
that it shall take no action and shall suffer no omission that would (i) violate
either Landlord's labor contracts, if any, or those of Landlord's contractors or
their subcontractors or (ii) create, or lead to the threat of, any work
stoppage, picketing, labor disruption or dispute. Any default by Tenant under
this Article which shall not be cured within three (3) business days after
receipt by Tenant of written notice thereof shall be deemed a material default
entitling Landlord to exercise any or all of the remedies as provided in this
lease. Landlord agrees that in connection with performing the Tenant's Work, the
mere retention by Tenant of any of the general contractors, construction
managers, subcontractors, materialmen and suppliers permitted by Article 3 shall
not be a violation of this subsection 53.11(a).
(b) Landlord further agrees that it shall use reasonable efforts to
avoid (i) violating either Tenant's labor contracts, if any, or those of
Tenant's contractors or their subcontractors or (ii) the creation, or threat, of
any work stoppage, picketing, labor disruption or dispute.
53.12 Roll-Down Gates: Tenant hereby agrees that, notwithstanding
anything in this lease to the contrary, Tenant shall not install roll-down gates
on Tenant's windows or doors. Notwithstanding the foregoing, Tenant may install,
in accordance with, and subject to, Article 3 and the other applicable
provisions of this lease, a roll-down gate inside the demised
25
premises, provided that such gate is at least five (5) feet from the demised
premises' storefront window, and, when rolled down, is completely camouflaged,
to the sole satisfaction of Landlord, by a system (drape or otherwise) that has
been approved in writing by Landlord. Tenant shall in no wise obstruct the
visibility of its windows during any hours of the day or night.
53.13 Obnoxious Odors: (a) Tenant will not permit any obnoxious odors to
emanate from the demised premises other than normal for a retail clothing store
taking prudent and reasonable care with respect to such odors. Tenant will,
within three (3) business days after written notice from Landlord, install or
commence to install, at its own cost and expense, reasonable control devices or
procedures to eliminate such odors, if any, and will complete such installations
as expeditiously as reasonably possible thereafter. In the event such condition
is not promptly remedied, Landlord may, at its discretion, cure such condition
and thereafter add the cost and expense incurred by Landlord therefor to the
next monthly rental to become due and Tenant shall pay said amount as Additional
Rental.
(b) Landlord will not permit any obnoxious odors to emanate from
the balance of the Building into the demised premises, other than normal for a
hotel, a restaurant and a bar, taking prudent and reasonable care with respect
to such odors.
53.14 Sidewalks and Curbs: Landlord shall make all repairs and
replacements to the sidewalks and curbs adjacent to the Building, except to the
extent required by the negligence or intentionally wrongful acts or omissions of
Tenant or any person or entity claiming by, through or under Tenant, which
repairs or replacements shall be made by Landlord, at Tenant's sole cost and
expense, to the extent so required, and Landlord's actual cost and expense shall
be reimbursed by Tenant to Landlord, as Additional Rent, within thirty (30) days
after Landlord's demand therefor, which demand shall be accompanied by invoices
or other reasonable evidence of such cost and expense. In addition, Landlord
shall cause the sidewalk immediately in front of the demised premises to be free
of snow, ice and rubbish (except for the rubbish of Tenant or any person or
entity claiming by, through or under Tenant). Tenant shall pay to Landlord, as
Additional Rent and within (30) days after Landlord's demand therefor,
twenty-five (25%) percent of Landlord's reasonable and actual cost and expense
to keep the sidewalks in front of the Building free of snow, ice and rubbish
(except for the rubbish of Tenant or any person or entity claiming by, through
or under Tenant, the cost of which shall be entirely paid by Tenant, as
Additional Rent, within thirty (30) days after Landlord's demand therefor). Such
demands shall be accompanied by reasonably detailed invoices for the costs and
expenses in question.
53.15 No Excessive Noise: (a) Tenant agrees that after the opening of
the demised premises for business, it will perform all of its work required or
permitted hereunder and conduct its business in the Demised Premises throughout
the term of this lease in such a manner so as not to create any excessive noise
(other than normal for a first-class retail clothing store taking reasonable
care with respect to such noise), nor permit any music, singing or other
entertainment which, in each case, unreasonably disturbs any of the other
tenants or occupants of the Building.
(b) Landlord agrees that after the opening of balance of the Building
for business, it will perform all work required or permitted hereunder and
conduct its business in the balance of the Building throughout the term of this
lease in such a manner so as not to create any excessive noise (other than
normal for a hotel, a restaurant and a bar taking reasonable care with respect
26
to such noise), nor permit any music, singing or other entertainment which, in
each case, unreasonably disturbs Tenant, other than normal for a hotel, a
restaurant and a bar.
53.17 Extermination: Tenant shall, at its sole cost and expense,
independently contract for the extermination of the demised premises (on a
monthly basis, or more frequently, if needed), and Landlord shall, at its sole
cost and expense, have the balance of the Building exterminated (on a monthly
basis, or more frequently, if needed) to the extent necessary, in the case of
Landlord's extermination, to prevent insect and rodent infestation from the
balance of the Building into the demised premises.
53.18 Material Inducement: The provisions of this Article 53 are a
material inducement for Landlord to execute and deliver this lease. Any failure
by Tenant to comply with the requirements of this Article 53 shall be deemed a
material breach of this lease, for which Landlord shall be entitled to any and
all of it remedies in accordance with terms, conditions and covenants of this
lease.
53.19 Tenant hereby acknowledges that Landlord intends initially to
operate the balance of the Building as a hotel, a restaurant and a bar, and for
related and incidental purposes. However, notwithstanding the references in this
Article 57 and elsewhere in this lease to the balance of the Building being
operated as a hotel with restaurant and bar, nothing contained in this lease or
otherwise shall require the balance of the Building (or any portion thereof) to
be operated as a hotel, restaurant or bar.
54. BROKER:
54.01 Tenant covenants, warrants and represents to Landlord that there
was no broker instrumental in consummating this lease except ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Company, Inc. and the Lansco Corporation (collectively, the "Broker") and for
Gervais, ▇▇▇▇▇ and ▇▇▇▇ (the "Tenant's Broker"), and no conversations, or
negotiations were had by Tenant with any other broker concerning the renting of
the Demised Premises. Except for claims made by the Broker, Tenant shall
indemnify, defend and hold and save Landlord harmless against any and all
liability from any claims of any broker (including Tenant's Broker) in
connection with the renting of the Demised Premises (including, without
limitation, the cost of counsel fees in connection with the defense of any such
claims in connection with the renting of the Demised Premises).
54.02 Landlord covenants, warrants and represents to Tenant that there
was no broker instrumental in consummating this lease except for the Broker and
Tenant's Broker, and no conversations, or negotiations were had by Landlord with
any other broker concerning the renting of the Demised Premises. Except for
claims made by Tenant's Broker, Landlord shall indemnify, defend and hold and
save Tenant harmless against any and all liability from any claims of any broker
(including the Broker) in connection with the renting of the Demised Premises
(including, without limitation, the cost of counsel fees in connection with the
defense of any such claims in connection with the renting of the Demised
Premises).
54.03 Based upon the foregoing representations, Landlord shall pay the
Broker their commission pursuant to separate agreements, and Tenant shall pay
Tenant's Broker pursuant to a separate agreement.
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55. RENEWAL OPTION:
55.01 Provided that this lease shall be in full force and effect on the
date on which the "Renewal Notice" is given and on the "Renewal Term
Commencement Date" (as such terms are defined below), Tenant shall have the
option (hereinafter called the "Renewal Option") to renew this lease for a
renewal term (hereinafter called the "Renewal Term") of five (5) years, to
commence on the day (hereinafter called the "Renewal Term Commencement Date")
after the Expiration Date and to expire on the day (hereinafter called the
"Renewal Term Expiration Date") which shall be the fifth (5th) anniversary of
the Expiration Date (or the January 31st immediately following the fifth (5th)
anniversary of the Expiration Date, if the fifth (5th) anniversary of the
Expiration Date is between September 1 and January 30). Tenant shall exercise
the Renewal Option by sending written notice thereof (hereinafter called the
"Renewal Notice") to Landlord on or before the day which shall be twelve (12)
months preceding the Expiration Date. If Tenant shall send the Renewal Notice
within the time and in the manner hereinbefore provided, this lease shall be
deemed renewed for the Renewal Term upon the terms, covenants and conditions
hereinafter contained. If Tenant shall fail to send the Renewal Notice within
the time and in the manner hereinbefore provided, the Renewal Option shall cease
and terminate, and Tenant shall have no further option to renew this lease.
55.02 The Renewal Term, if any, shall be upon, and subject to, all of
the terms, covenants and conditions provided in this lease, including, without
limitation, the provisions of subsection 41.01(b), for the original term hereof,
except that:
(a) Landlord shall not be required to perform Landlord's Work or
perform or pay for any other work or installations in or to the Demised
Premises, except for any repair obligations contained in this lease that
Landlord is expressly required to perform;
(b) Any terms, covenants or conditions hereof that are expressly or
by their nature inapplicable to the Renewal Term, including, without limitation,
Section 40.04, shall not apply during the Renewal Term; and
(c) The annual Fixed Rental payable by Tenant during the Renewal
Term (hereinafter called the "Renewal Rent"), subject to adjustment as otherwise
in this lease provided, shall be the "Rental Value" (as such term is defined
below) payable in equal monthly installments, in advance, on the first day of
each and every calendar month during the Renewal Term.
55.03 "Rental Value" shall mean the fair market rental value of the
demised premises to be calculated as of the "Determination Date" (as such term
is hereinafter defined) on the basis of a new five (5) year letting of the
demised premises. The Rental Value shall be determined jointly by Landlord and
Tenant, and such determination shall be confirmed in a writing (hereinafter
called a "Rental Agreement") to be executed in recordable form by Landlord and
Tenant not later than the day (hereinafter called the "Determination Date")
which shall be six (6) months next preceding the Renewal Term Commencement Date.
In the event that Landlord and Tenant shall have failed to join in executing a
Rental Agreement on or before the Determination Date because of their failure to
agree upon the Rental Value, then the Rental Value shall be determined by
arbitration as follows:
(a) Landlord and Tenant shall each appoint an arbitrator by written
notice given to the other party hereto not later than thirty (30) days after the
Determination Date. If
28
either Landlord or Tenant shall have failed to appoint an arbitrator within such
period of time and thereafter shall have failed to do so by written notice given
within a period of ten (10) days after notice by the other party requesting the
appointment of such arbitrator, then such arbitrator shall be appointed by the
American Arbitration Association or its successor (the branch office of which is
located in or closest to the City and State of New York), upon request of either
Landlord or Tenant, as the case may be;
(b) The two (2) arbitrators appointed as above provided shall
attempt to reach an agreement as to the Rental Value and in the event they are
unable to do so within thirty (30) days after their joint appointment, then they
shall appoint a third (3rd) arbitrator by written notice given to both Landlord
and Tenant, and, if they fail to do so by written notice given within forty-five
(45) days after their appointment, such third (3rd) arbitrator shall be
appointed as above provided for the appointment of an arbitrator in the event
either party fails to do so;
(c) All of such arbitrators shall be real estate appraisers having
not less than ten (10) years experience in appraising the value of leasehold
interests in real estate similar to the Building located within the City of New
York and who are members of M.A.I. or S.R.E.A.
(d) the three arbitrators, selected as aforesaid, forthwith shall
convene and render their decision in accordance with the then applicable rules
of the American Arbitration Association or its successor, which decision shall
be strictly limited to a determination of the Rental Value within twenty (20)
days after the appointment of the third (3rd) arbitrator. The decision of such
arbitrators shall be in writing and the vote of the majority of them shall be
the decision of all and shall be binding upon Landlord and Tenant. Duplicate
original counterparts of such decision shall be sent forthwith by the
arbitrators by certified mail, return receipt requested, to both Landlord and
Tenant. The arbitrators, in arriving at their decision, shall be entitled to
consider all testimony and documentary evidence that may be presented at any
hearing, as well as facts and data which the arbitrators may discover by
investigation and inquiry outside such hearings. If, for any reason whatsoever,
a written decision of the arbitrators shall not be rendered within twenty (20)
days after the appointment of the third (3rd) arbitrator, then, at any time
thereafter before such decision shall have been rendered, either party may apply
to the Supreme Court of the State of New York or to any other court having
jurisdiction and exercising the functions similar to those now exercised by such
court, by action, proceeding or otherwise (but not by a new arbitration
proceeding) as may be proper, to determine the question in dispute consistently
with the provisions of this lease. The cost and expense of such arbitration,
action, proceeding, or otherwise shall be borne equally by Landlord and Tenant.
Notwithstanding anything to the contrary contained in this Section
55.03, the Rental Value shall in no event be less than an amount equal to One
Million Four Hundred Nine Thousand One Hundred Ninety-Six ($1,409,196.00)
Dollars per annum (the "Minimum Renewal Rent") ($117,433.00 per month).
55.04 In the event that Renewal Rent shall not be finally determined on
or before the Renewal Term Commencement Date, then, until same shall be finally
determined as provided herein, Tenant shall pay the Minimum Renewal Rent. Upon
the final determination of the Renewal Rent, if the Renewal Rent, as finally
determined, shall exceed the Minimum Renewal Rent, Tenant
29
shall make appropriate payment to Landlord within thirty (30) days after demand
to pay to Landlord the difference between (i) the Renewal Rent that would have
been theretofore payable from the Renewal Term Commencement Date through the
date of such demand, less (ii) the Minimum Renewal Rent received by Landlord and
thereafter Tenant shall pay to Landlord, and the Fixed Rental payable during the
balance of the Renewal Term shall be, the Renewal Rent as finally determined.
55.05 Notwithstanding contained in this Article 55 to the contrary, in
the event that the Rental Value is determined by arbitration as set forth in
Section 55.03 above, then, in the event that the Rental Value so determined by
arbitration is more than $1,409,196.00 for the first (1st) year of the Renewal
Term, Tenant shall have the right to terminate this lease by giving Landlord
notice of such termination within thirty (30) days after Landlord and Tenant
have received such determination, TIME BEING OF THE ESSENCE. If Tenant so
notifies Landlord, then this lease and the term hereof shall end on the date
(the "Termination Effective Date") which is one (1) year after the date Tenant
gives Landlord such notice of termination, as if the Termination Effective Date
were the Expiration Date. Through the Termination Effective Date, Tenant shall
observe, perform and comply with all of the terms, covenants and conditions in
this lease on Tenant's part to observe, perform and comply with, including,
without limitation, the increase of the Fixed Rental to the Rental Value so
determined by arbitration.
56. MODIFICATION FOR MORTGAGES:
56.01 If, in connection with obtaining financing or refinancing for the
Building of which the Demised Premises form a part, a banking, insurance or
other institutional lender shall request reasonable modifications to this lease
as a condition to such financing or refinancing, Tenant will not unreasonably
withhold, delay or defer its consent thereto, provided that such modifications
do not increase the obligations of Tenant hereunder (except, perhaps, to the
extent that Tenant may be required to give additional notices of any defaults by
Landlord to such lender) or adversely affect the leasehold interest hereby
created or adversely reduce Tenant's rights and remedies under this lease
(except as otherwise provided above with respect to additional notices). In no
event shall a requirement that the consent of any such lender be given for any
modification of this lease be deemed to materially adversely affect the
leasehold interest hereby created.
57. EXCULPATORY CLAUSE:
57.01 Tenant shall look solely to the estate and property of Landlord in
the Building (including Landlord's rights to the rents, profits, insurance
proceeds and condemnation awards related thereto), for the satisfaction of
Tenant's remedies for the collection of a judgment (or other judicial process)
requiring the payment of money by Landlord in the event of any default or breach
by Landlord with respect to any of the terms, covenants and conditions of the
lease to be observed and/or performed by Landlord, and no other property or
assets of Landlord shall be subject to levy, execution or other enforcement
procedure for the satisfaction of Tenant's remedies under or with respect to
this lease, the relationship of Landlord and Tenant hereunder, or Tenant's use
and occupancy of the Demised Premises.
58. COVENANT AGAINST LIENS:
58.01 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
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or the Building, (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) days after notice to Tenant
of the filing thereof; and the Tenant named herein shall indemnify and save
Landlord harmless 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
named herein agrees to reimburse Landlord for Landlord's reasonable expenses (as
Additional Rental), within fifteen (15) days after Landlord's demand therefor.
All materialmen, contractors, artisans, mechanics, laborers and any other
persons now or hereafter contracted with Tenant for the furnishing of any labor,
services, materials, supplies or equipment with respect to any portion of the
Building 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. Subject to the provisions of this Section 58.01 and the other
applicable provisions of this lease, Tenant may finance the acquisition of
Tenant's Property and of Tenant's inventory, Landlord hereby waiving any
security interest it may otherwise have in same, but not waiving any other
rights or interests Landlord may have in same pursuant to the applicable
provisions of this lease.
58.02 Landlord shall not do any act or make any contract which may
create or be the foundation for any lien or other encumbrance upon any personal
property or trade fixtures of Tenant in any portion of the Demised Premises. If,
because of any act or omission (or alleged act or omission) of Landlord, any
mechanic's lien or other lien, charge or order for the payment of money shall be
filed against Tenant or any personal property or trade fixtures of Tenant in any
portion of the Demised Premises (whether or not such lien, charge or order is
valid or enforceable as such), Landlord shall, at its own cost and expense,
cause same to be discharged of record or bonded within thirty (30) days after
notice to Landlord of the filing thereof; and the Landlord shall indemnify and
save Tenant harmless against and from all costs, liabilities, suits, penalties,
claims and demands, including reasonable counsel fees resulting therefrom. If
Landlord fails to comply with the foregoing provisions, Tenant shall have the
option of discharging or bonding any such lien, charge or order and the Landlord
named herein agrees to reimburse Tenant for Tenant's reasonable expenses, within
fifteen (15) days after Tenant's demand therefor. All materialmen, contractors,
artisans, mechanics, laborers and any other persons now or hereafter contracted
with Landlord for the furnishing of any labor, services, materials, supplies or
equipment with respect to any portion of the premises of which the Demised
Premises form a part 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
Landlord to obtain payment for same.
59. EASEMENT FOR PIPES, CONDUITS, ELECTRICAL CLOSETS,
EQUIPMENT, ETC.:
59.01 Tenant shall permit Landlord to erect, install, use, maintain and
repair pipes, ducts, cables, conduits, electrical closets, equipment for the
building, plumbing, vents and wires in, to and through the Demised Premises as
and to the extent that the same may be necessary for the proper operation and
maintenance of the Building or to the extent necessary to comply with the Legal
and Insurance Requirements with which Landlord is obligated to comply under this
lease. In connection with Landlord's rights under this Section 59.01, Landlord
shall use reasonable efforts to minimize interference with Tenant's use
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of the demised premises for the uses expressly permitted under this lease, and
shall erect and install the foregoing in concealed areas.
60. FREIGHT ELEVATOR:
60.01 Tenant shall have the non-exclusive use, together with Landlord,
other tenants and occupants of the Building, and their respective agents,
employees, contractors and invitees, of the Building's freight elevator,
provided that Tenant's use of such freight elevator is in accordance and
compliance with, and subject to, the design specifications therefor, all
applicable Legal and Insurance Requirements, and the Rules and Regulations.
60.02 Tenant acknowledges that use of such freight elevator will permit
the users thereof access to portions of the Building outside the demised
premises. Therefore, only Tenant's employees may use such freight elevator, and
no delivery person deliverying merchandise to the demised premises shall be
permitted to use the freight elevator or to otherwise have access to portions of
the Building outside the demised premises.
60.03 Tenant shall pay to Landlord, as Additional Rent and within thirty
(30) days after Landlord's demand therefor from time to time, Tenant's share of
the cost of the maintenance and service contract for such freight elevator,
based upon the relative use by Tenant (and all persons claiming by, through or
under Tenant) of such freight elevator. Such share shall from time to time be
reasonably determined by Landlord in good faith, but after consultation with
Tenant, and shall be subject to increases and decreases, depending upon changes
in such relative use. Until sufficient time elapses for Landlord to make the
first of such determinations, Tenant's share shall be twenty (20%) percent. If
Tenant, at any time or from time to time disputes Landlord's determination,
including such twenty (20%) percent, Landlord and Tenant shall endeavor in good
faith to select a mutually acceptable third-party to make such determination for
the time period(s) in question. If Landlord and Tenant cannot so select a
third-party, such dispute shall be determined by arbitration pursuant to Article
68 below. Until such dispute is resolved by arbitration or settled by agreement
between Landlord and Tenant, Tenant shall pay the amount so determined by
Landlord. To the extent that such dispute shall be resolved in Tenant's favor,
Landlord shall refund to Landlord all overpayments to Tenant within thirty (30)
days after Landlord receives notice of such resolution. If it is determined that
Tenant has underpaid, then Tenant shall pay to Landlord such underpayment within
thirty (30) days after Landlord's demand therefor. If Landlord pays such refund,
or Tenant makes such payment, as the case may be, within such thirty (30) day
period, no interest shall accrue or be payable thereon.
61. ADDENDUM TO ARTICLE 11:
61.01 In addition to the provisions and limitations set forth in Article
11 hereof, in no event shall any permitted sublessee assign or encumber its
sublease, further sublet all or any portion of its sublet space, or otherwise
suffer or permit the sublet space, or any part thereof, to be used or occupied
by others, without Landlord's prior written consent in each instance, except to
the extent such consent is not required by the express provisions of this lease.
61.02 (a) Except when Landlord's consent is not required, if Tenant
shall, at any time or times during the term of this lease, desire to assign this
lease or sublet the Demised Premises, Tenant shall give notice thereof (an "A/S
Notice") to Landlord, which notice shall be accompanied by: (i) if the same
32
is in existence, a duplicate original copy of the proposed assignment or
sublease, or, in lieu thereof, a duplicate original copy of the offer to assign
or sublease, signed by Tenant and the proposed assignee or subtenant, setting
forth all of the major business terms thereof, the effective or commencement
date of which shall be not less than thirty (30) nor more than one hundred
eighty (180) days after the giving of the A/S Notice; (ii) a statement setting
forth, in reasonable detail, the identity of the proposed assignee or subtenant,
the nature of its business and its proposed use of the Demised Premises; (iii)
current financial information with respect to the proposed assignee or
subtenant, including its most recent financial report; and (iv) the information
necessary to make the calculations described in subsection (c) below, if Tenant
desires payment from Landlord pursuant to said subsection (c).
(b) Except for such assignments or sublettings that, pursuant to the
express provisions of this Article, do not require Landlord's consent, the A/S
Notice shall be deemed an offer from Tenant to Landlord whereby Landlord may, at
its option ("Landlord's Option") terminate this lease. Landlord's Option may be
exercised by Landlord by notice to Tenant at any time within twenty (20) days
after the A/S Notice has been given by Tenant to Landlord; and during such
twenty (20) day period, Tenant shall not assign this lease or sublet such space
to any person. If Landlord fails to exercise Landlord's Option within such
twenty (20) day period, then the Landlord's Option shall be deemed waived for
the proposed assignment or subletting in question and the balance of this
Article 61 shall apply.
(c) If Landlord exercises the Landlord's Option, then to the extent:
(i) in the case of a proposed assignment, (A) all sums and other
consideration to be paid to Tenant by the assignee for, or by reason of, such
proposed assignment (including all sums to be paid for the sale of Tenant's
fixtures, leasehold improvements, equipment, furniture, furnishings, or other
personal property), exceeds (B) the sum of the then net unamortized or
undepreciated cost of such fixtures, leasehold improvements, equipment,
furniture, furnishings or other property to be sold to the proposed assignee,
determined on the basis of Tenant's federal income tax returns, plus the other
expenses reasonably and directly to be paid by Tenant with respect to such
assignment (including, without limitation, brokerage commissions, legal fees and
expenses and alteration costs); or
(ii) in the case of a proposed sublease, (A) all rents, additional
charges, and other consideration payable under the proposed sublease by the
subtenant to Tenant that are in excess of the Fixed Rental and Additional Rental
accruing during the term of the proposed sublease pursuant to the terms hereof
(including all sums paid for the sale or rental of Tenant's fixtures, leasehold
improvements, equipment, furniture, or other personal property) exceeds, (B) in
the case of the sale or rental of such fixtures, leasehold improvements,
equipments, furnitures, furnishings or other property to be sold or rented to
the proposed subtenant, the sum of the then net unamortized or undepreciated
cost thereof determined on the basis of Tenant's federal income tax returns)
plus the other expenses reasonably and directly to be paid by Tenant with
respect to such subletting (including, without limitation, brokerage commission,
legal fees and expenses and alteration costs), all of which expenses, for the
purposes of determining the amounts payable to Landlord pursuant to this
subsection (c), shall be amortized, on a straight-line basis, over the term of
the sublease,
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Landlord shall pay to Tenant within thirty (30) days after Landlord's exercise
of Landlord's Option, the lesser of (1) 100% of such excess, and (2) then net
unamortized or undepreciated cost of such fixtures, leasehold improvements,
equipment, furniture, furnishings and other property to be sold or rented to the
proposed assignee or subtenant determined on the basis of Tenant's federal
income tax returns, but only to the extent any of the information required to
make the calculations described in (i) or (ii) above are expressly set forth in
the A/S Notice and the other information required by Section 61.02 above, and in
such other reasonable evidence or documentation reasonably required by Landlord
to substantiate such calculations, which evidence and documentation shall be
furnished by Tenant to Landlord within ten (10) days after Landlord's request
therefor.
61.03 If Landlord exercises Landlord's Option , then this lease shall
end and expire upon the date that such assignment or subletting was to be
effective or to commence, as the case may be, and the Fixed Rent and Additional
Rent shall be paid and apportioned to such date.
61.04 In the event that Tenant complies with the provisions of Article
61.02 hereof and Landlord does not exercise Landlord's Option within the time
provided therefor, and provided that Tenant is not in default of any of Tenant's
obligations under this lease after notice and the expiration of any applicable
grace period, Landlord's consent (which must be in writing and in form
satisfactory to Landlord) to the proposed assignment or sublease of the entire
demised premises shall not be unreasonably withheld, delayed or further
conditioned, provided and upon condition that:
(i) In Landlord's reasonable judgment, the proposed assignee or
subtenant is engaged in such a business, and the Demised Premises, or the
relevant part thereof, will be used in such a manner, that: (a) is in keeping
with the then standards of the Building; (b) is limited to the use expressly
permitted under this lease; and (c) will not violate any negative covenant as to
use contained in any other lease of space in the Building;
(ii) The proposed assignee or subtenant is a reputable person of
good character and with sufficient financial worth considering the
responsibility involved, and Landlord has been furnished with reasonable proof
thereof;
(iii) Neither (a) the proposed assignee or sublessee nor (b) any
person that, directly or indirectly, controls, is controlled by, or is under
common control with, the proposed assignee or sublessee or any person who
controls the proposed assignee or sublessee, is then an occupant of any part of
the Building;
(iv) The proposed assignee or sublessee is not a person with whom
Landlord is then negotiating to lease space in the Building;
(v) The form of the proposed sublease shall be in form
reasonably satisfactory to Landlord and shall comply with the applicable
provisions of this
Article;
(vi) There shall not be more than one (l) subtenant of the
Demised Premises;
(vii) intentionally omitted;
(viii) Tenant shall reimburse Landlord, within thirty (30) days
after Landlord's demand therefor, for any
34
thirty-party costs (up to $1,000.00 per each requested consent) that may be
reasonably incurred by Landlord in connection with said assignment or sublease,
including the costs of making investigations as to the acceptability of the
proposed assignee or subtenant and legal costs incurred in connection with the
granting of any requested consent (which costs Tenant agrees to reimburse
regardless of whether or not Landlord consents to the proposed assignment or
subletting in question);
(ix) Tenant shall not have advertised or publicized in any way
(as opposed to merely listing with a real estate broker, for which Landlord's
approval shall not be required) the availability of the Demised Premises without
prior notice to, and approval by, Landlord (which approval shall not be
unreasonably withheld, delayed or conditioned), nor shall any advertisement or
listing state the name (as distinguished from the address) of the Building or
the proposed rental;
(x) The sublease shall not allow use of the Demised Premises or
any part thereof: (a) as a discount store; (b) as a multiple tenancy store; (c)
by a foreign or domestic governmental agency; (d) as a betting parlor or
gambling casino; or (e) by a utility company; and
(xi) The sublease shall not provide for an option on behalf of
the subtenant thereunder to extend or renew the term of such sublease, except to
the extent such renewal is co-terminus (less one (1) day) with any renewal of
the term of this lease.
If the proposed subletting is for less than the entire demised premises, Tenant
acknowledges and agrees that Landlord may withhold its consent thereto for any
or no reason.
61.05 In the event that (i) Landlord fails to exercise Landlord's Option
under Article 61.02 hereof and consents to a proposed assignment or sublease and
(ii) Tenant fails to execute and deliver the assignment or sublease to which
Landlord consented within one (1) year after the giving of such consent, then
Tenant shall again comply with all of the provisions and conditions of Article
61.02 hereof before assigning this lease or subletting all or part of the
Demised Premises.
61.06 Each subletting pursuant to this Article 61 shall be subject to
all of the covenants, agreements, terms, provisions and conditions contained in
this lease. Notwithstanding any such subletting to any subtenant and/or
acceptance of rent or Additional Rental by Landlord from any subtenant, Tenant
shall and will remain fully liable for the payment of the Fixed Rental and
Additional Rental due, and to become due, hereunder, for the performance of all
of the covenants, agreements, terms, provisions and conditions contained in this
lease on the part of Tenant to be performed and for all acts and omissions of
any licensee, subtenant, or any other person claiming under or through any
subtenant that shall be in violation of any of the obligations of this lease,
and any such violation shall be deemed to be a violation by Tenant. Tenant
further agrees that, notwithstanding any such subletting, no other and further
subletting (including, without limitation any extensions or renewals of any
initial sublettings, except as may otherwise be expressly permitted pursuant to
subsection 61.04(xi) above) of the Demised Premises by Tenant, or any person
claiming through or under Tenant, shall, or will be, made, except upon
compliance with, and subject to, the provisions of this Article 61. If Landlord
shall decline to give its consent to any proposed assignment or sublease, or if
Landlord shall exercise Landlord's Option under Article 61.02 hereof, Tenant
shall indemnify, defend and hold Landlord harmless from and against any and all
35
losses, liabilities, damages, costs and expenses (including counsel fees)
resulting from any claims that may be made against Landlord in connection with
the proposed assignment or sublease, either by the proposed assignee or
subtenant or by any brokers or other persons claiming a commission or similar
compensation.
61.07 With respect to each and every sublease or subletting, occupancy,
license or concession agreement, regardless of whether or not Landlord's consent
is required, it is further agreed that:
(i) no subletting shall be for a term ending later than one day
prior to the expiration date of this lease (as same may be extended);
(ii) no sublease, occupancy, license or concession agreement
shall be valid, and no subtenant, occupant, licensee or concessionaire shall
take possession of the demised premises or any part thereof, until an executed
counterpart of such sublease or agreement, or a conformed copy thereof, has been
delivered to Landlord; and
(iii) each sublease, occupancy, license and concession agreement
for the Demised Premises executed after the date hereof by Tenant hereunder
shall provide that (a) it is subject and subordinate to this lease and all
instruments to which this lease is subject and subordinate, (b) the subtenant,
occupant, licensee or concessionaire will not pay any rent or other sums under
its sublease, or agreement more than one (1) month in advance (except to the
extent that a corresponding item of Additional Rent under this lease is payable
more than one (1) month in advance), and (c) in the event of a termination,
re-entry, or dispossess by Landlord under this lease, Landlord (or the lessor of
any superior lease or holder of any superior mortgage) may, at its option, cause
the subtenant, occupant, licensee or concessionaire to attorn to, or enter into
a direct sublease, occupancy, license or concession agreement on identical
terms, with Landlord (or such superior lessor), except that Landlord (or such
superior lessor) shall not (x) be liable for any previous act or omission of
Tenant under such sublease or agreement, except for acts or omissions in breach
of Tenant's obligations under such sublease, with respect to which acts or
omissions Landlord shall not be relieved of its obligations from and after the
date on which it shall succeed as sublandlord thereunder, (y) be subject to any
offset, not expressly provided in such sublease or agreement, that theretofore
accrued to such subtenant, occupant, licensee or concessionaire against Tenant,
or (z) be bound by any previous modification of such sublease or agreement or by
any previous prepayment of more than one (1) month's Fixed Rental or any
Additional Rent then due (except for monthly payments on account of Additional
Rent required or permitted thereunder), unless such modification or prepayment
shall have been expressly approved in writing by Landlord.
61.08 Any assignment or transfer shall be made only if, and shall not be
effective until, Tenant and the assignee shall duly execute, acknowledge and
deliver to Landlord an assignment and assumption of lease agreement that is
enforceable and binding upon Tenant and the assignee in all respects, pursuant
to which (a) Tenant has assigned to the assignee, and the assignee has assumed
from Tenant, as of the effective date of the assignment, all of Tenant's right,
title and interest in and to this lease and the demised premises, and all of
Tenant's obligations and liabilities under this lease, as if the assignee had
executed this lease originally as Tenant, (b) the obligations and liabilities so
assumed by the assignee shall benefit Landlord as well as Tenant, (c) as between
Tenant and Landlord, Tenant is not released or relieved from any such
obligations or liabilities,
36
and (d) the assignee shall agree that the provisions contained in Article 11 and
this Article 61 shall, notwithstanding such assignment or transfer, continue to
be binding upon it in respect of all future assignments and transfers. The
original named Tenant (and all successors and assigns) covenant that,
notwithstanding any assignment or transfer, whether or not in violation of the
provisions of this lease, and notwithstanding the acceptance of Fixed Rental
and/or Additional Rental by Landlord from an assignee, transferee, or any other
party, the original named Tenant (and such successors and assigns) and all
Guarantors shall remain fully liable for the payment of the Fixed Rental and
Additional Rental and for the other obligations of this lease on the part of
Tenant to be performed or observed.
61.09 If Landlord shall give its consent to any assignment of this lease
or to any sublease, Tenant shall, in consideration therefor, pay to Landlord, as
Additional Rental:
(i) in the case of an assignment, an amount equal to fifty (50%)
percent of (A) all sums and other consideration paid to Tenant by the assignee
for, or by reason of, such assignment (including all sums paid for the sale of
Tenant's fixtures, leasehold improvements, equipment, furniture, furnishings, or
other personal property, less (B) the then net unamortized or undepreciated cost
of such fixtures, leasehold improvements, equipment, furnishings and other
personal property sold to such assignee, determined on the basis of Tenant's
federal income tax returns) and the other expenses reasonably and directly paid
by Tenant with respect to such assignment (including, without limitation,
brokerage commissions, legal fees and expenses and alteration costs); and
(ii) in the case of a sublease, fifty (50%) percent of (A) all
rents, additional charges, and other consideration payable under the sublease by
the subtenant to Tenant that are in excess of the Fixed Rental and Additional
Rental accruing during the term of the sublease in respect of the subleased
space (at the rate per square foot payable by Tenant hereunder) pursuant to the
terms hereof (including all sums paid for the sale or rental of Tenant's
fixtures, leasehold improvements, equipment, furniture, or other personal
property, less, (B) in the case of the sale of such fixtures, leasehold
improvements, equipment, furnishings and other personal property sold to such
subtenant, the then net unamortized or undepreciated cost thereof determined on
the basis of Tenant's federal income tax returns) and the other expenses
reasonably and directly paid by Tenant with respect to such subletting
(including, without limitation, brokerage commission, legal fees and expenses
and alteration costs), all of which expenses, for the purposes of determining
the amounts payable to Landlord pursuant to this Section 61.09, shall be
amortized, on a straight-line basis, over the term of the sublease. The sums
payable under this Article 61.09 shall be paid to Landlord as and when payable
by the subtenant to Tenant.
61.10 For the purpose of this Article, the following are "Prohibited
Transfers" to which Article 11 and this Article 61 shall apply as if any of such
Prohibited Transfers were an assignment of this lease:
A transfer (however accomplished, whether in a single transaction or in
a series of related or unrelated transactions) of stock (or any other mechanism
such as, by way of example, the issuance of additional stock, a stock voting
agreement or change in class(es) of stock) which results in a change of control
of Tenant or any Guarantor or of entity that controls Tenant or a Guarantor (if
Tenant, any such Guarantor or such entity is a corporation), or (b) if Tenant,
any Guarantor or any entity that
37
controls Tenant or a Guarantor is a partnership, joint venture, limited
liability company or other form of business entity, a transfer (however
accomplished, whether in a single transaction or in a series of related or
unrelated transactions) of an interest in the distributions of profits and
losses of such partnership, joint venture, limited liability company or other
form of business entity (or other mechanism, such as, by way of example, the
creation of additional general partnership or limited partnership interests)
which results in a change of control of such partnership, joint venture, limited
liability company or other form of business entity. For the purposes of the
preceding sentence and the last sentence of Section 6.15 below, the term
"control" shall mean ownership of more than fifty (50%) percent of all the
voting stock of a corporation or more than fifty (50%) percent of all the legal
and equitable interest in any partnership, joint venture, limited liability
company or other form of business entity. Notwithstanding the foregoing, if
Tenant, a Guarantor or entity which controls Tenant or Guarantor is a
corporation listed and traded on a nationally recognized stock exchange or
over-the-counter market, the transfer, sale or other disposition of the stock of
such corporation, including transfers, sales and other dispositions directly
related to Tenant "going public," shall not be deemed an assignment of this
lease or a "Prohibited Transfer." In addition, transfers of the voting stock of
Tenant or any Guarantor among the persons or entities that own such stock on the
date of this lease or to the (present or former) spouses, siblings (including
step and half siblings), children (including step children) or grandchildren
(including step grandchildren) of such persons or to trusts for the benefit of
such spouses, siblings, children or grandchildren shall not be deemed an
assignment of this lease or a Prohibited Transfer, and for the purposes of
determining whether a Prohibited Transfer will or has occurred, ownership and
subsequent transfers by any such spouses, siblings, children, grandchildren or
trusts, shall be deemed ownership and transfers by the owners on the date of
this lease.
61.11 The joint and several liability of Tenant and any immediate or
remote successor in interest to Tenant, the liability of any Guarantor, and the
due performance of the obligations of this lease on Tenant's part to be
performed or observed, shall not be discharged, released, or impaired in any
respect by any agreement or stipulation made by Landlord extending the time of,
or modifying any of the obligations of, this lease, or by any waiver or failure
of Landlord to enforce any of the obligations of this lease.
61.12 The listing of any name other than that of Tenant, whether on the
doors of the Demised Premises, on the Building directory (if any), or otherwise,
shall not operate to vest any right or interest in this lease or in the Demised
Premises, nor shall it be deemed to be the consent of Landlord to any assignment
or transfer of this lease, to any sublease of the Demised Premises, or to the
use or occupancy thereof by others.
61.13 Notwithstanding anything contained in Article 11 above to the
contrary, but provided this lease is in full force and effect, without default
(after the giving of any required notice and the expiration of any applicable
cure period) of any of the terms, covenants or conditions on Tenant's part to
observe, perform or comply with, and subject to all of the applicable provisions
of this lease, Tenant may, without Landlord's prior written consent, permit the
use and occupancy during the term of this lease of up to twenty-five (25%)
percent, in the aggregate, of the ground floor sales area of the demised
premises, by licensees or concessionaires (hereinafter collectively referred to
as the "Licensees"), for any of the uses
38
expressly permitted under this lease, and for no other purpose, provided, and
upon the condition that:
(a) At least ten (10) business days prior to the date each
Licensee first so uses or occupies the Demised Premises, Tenant shall give
Landlord notice of such intended use or occupancy;
(b) Such use and occupancy shall be subject to all the terms,
covenants and conditions to this lease on Tenant's part to observe and perform,
as if such Licensee(s) were the Tenant hereunder;
(c) Such use and occupancy shall in no way increase, amend,
modify or extend Landlord's obligations or liabilities under this lease in any
way whatsoever, or diminish, restrict, limit, forfeit or waive any of Landlord's
rights or remedies under this lease in any way whatsoever;
(d) Such use and occupancy shall in no way give to the Licensees
any rights or remedies against Landlord, and Tenant shall indemnify and hold
Landlord harmless from and against any and all, actions, proceedings,
liabilities, obligations, claims, damages, deficiencies, losses, judgments,
suits, expenses and costs (including, without limitation, court costs and
reasonable legal fees and disbursements for which Landlord is liable) to the
extent arising under, out of or in connection with, or to the extent resulting
from, such use and occupancy;
(e) Tenant shall remain fully liable for the payment of Fixed
Rental and Additional Rent due and to become due under this lease and for the
performance and observance of all of the terms, covenants and conditions
contained in this lease on Tenant's part to perform or observe, and all acts or
omissions by the Licensees or anyone claiming under or through Tenant or the
Licensees which shall be a default under this lease, shall be deemed to be a
default by Tenant;
(f) Such use and occupancy shall not be deemed a waiver of
Landlord's rights under this Lease to consent to the use or occupancy of the
Demised Premises (or any portion thereof) by any other person or entity or to
the assignment of this lease or the subletting of the Demised Premises (or any
portion thereof);
(g) Prior to such use or occupancy by each Licensee, Tenant shall
deliver a true and complete copy of this lease to such Licensee (except that
Tenant may redact the rental provisions), and any use or occupancy by the
Licensees of the Demised Premises (or any portion thereof) shall be deemed an
acceptance by the Licensees of all of the conditions set forth in this Section
63.13; and
(h) The space or area of the Demised Premises used or occupied by
the Licensees shall not be separately demised or otherwise physically separated
from the balance of the Demised Premises, nor shall there be any separate access
to or from the Demised Premises for any of the Licensees.
61.14 Notwithstanding anything contained in Article 11 or Section 61.11
above to the contrary, but provided this lease is in full force and effect,
without default (after the giving of any required notice and the expiration of
any applicable cure period) of any of the terms, covenants or conditions on
Tenant's part to observe, perform or comply with, and subject to all of the
applicable provisions of this lease, Tenant may, without Landlord's prior
written consent, but only in connection with the bona fide sale of the business
being conducted by Tenant in the
39
Demised Premises: (a) assign its interest in this lease, or sublet the entire
Demised Premises, to a person, corporation or other entity to which all or
substantially all of Tenant's assets are transferred, or (b) allow a transfer
that is otherwise deemed a Prohibited Transfer pursuant to Section 61.10 above
to the person or entity purchasing such business, provided and upon the
condition that:
(i) Immediately after the assignment, subletting or transfer,
the then Tenant and all Guarantors shall have assets and a net worth, determined
in accordance with generally accepted accounting principles, and certified to
Landlord by either an independent certified public accountant or the Chief
Financial Officer of the then Tenant and all Guarantors, at least equal to
$55,000,000.00, and at least fifteen (15) days prior to the effective date of
such assignment, subletting or transfer, such certificate and proof reasonably
satisfactory to Landlord of such assets and net worth (including, without
limitation, audited financial statements, if available) shall have been
delivered to Landlord;
(ii) The assignment, subletting or transfer, as the case may be,
is for a good business purpose and not principally for the purpose of
transferring the leasehold estate created hereby;
(iii) The sale of the business being conducted by Tenant in the
Demised Premises is part of the contemporaneous sale of at least a majority of
the other (non-outlet) stores being operated by Tenant or a Related Entity (as
defined in Section 65.15 below) under the same trade name under which the
demised premises is being operated;
(iv) At least fifteen (15) days prior to the effective date of
the assignment, subletting or transfer of capital stock, Tenant shall notify
Landlord of the proposed assignment, subletting or transfer of capital stock;
(v) After the effective date of the assignment, sublease
transfer, the then Tenant (and the sublessee, if the transaction is a sublease)
shall continue to operate the business being conducted in the demised premises,
in accordance with all of the terms, covenants and conditions contained in this
lease (including, without limitation, Section 44.01); and
(vi) In the case of the assignment of this lease, an executed
duplicate original of the assignment and assumption agreement shall be delivered
to Landlord at least fifteen (15) days prior to the effective date thereof,
together with such assignment and assumption agreement, Tenant shall deliver to
Landlord a certified copy of a duly adopted resolution of the board of directors
of both the Tenant and the assignee, authorizing the execution, acknowledgment
and delivery of said assignment and assumption agreement, and the transactions
contemplated therein.
61.15 Notwithstanding anything contained in Article 11 or Section 61.11
above to the contrary, but provided this lease is in full force and effect,
without default (after the giving of any required notice and the expiration of
any applicable cure period) of any of the terms, covenants or conditions on
Tenant's part to observe, perform or comply with, and subject to all of the
applicable provisions of this lease, Tenant may, without Landlord's prior
written consent, assign its entire interest in this lease and the leasehold
estate hereby created, or sublet the entire Demised Premises, to a Related
Entity (as hereinafter defined), provided that (i) at least ten (10) days prior
to the effective date of such assignment or the commencement date of
40
such sublease, as the case may be, Tenant furnishes Landlord with the name of
such proposed assignee or subtenant, together with the certification of Tenant,
and such other proof as Landlord may reasonably request, that such proposed
assignee or subtenant is a Related Entity (ii) Tenant and all Guarantors shall
and will remain fully liable for the payment of the Fixed Rental and Additional
Rent due and to become due under this lease and shall not be released from any
of their obligations or liabilities under this lease and Tenant and all
Guarantors shall be fully responsible and liable for all acts or omissions of
such proposed assignee or subtenant or anyone claiming under or through Tenant
or such proposed assignee or subtenant, and (iii) such proposed assignee or
subtenant, as of the effective date of such assignment or the commencement date
of such sublease, as the case may be, and all times thereafter, is a Related
Entity (unless such Related Entity has assigned this lease in accordance with,
and subject to, the applicable provisions of this Article 61). In connection
with the information to be provided to Landlord pursuant to this Section,
Landlord shall have the right, at any reasonable time, and from time to time,
upon prior reasonable notice, to examine such books and records of the then
Tenant (or any assignor of Tenant's interest in this lease) as may be reasonably
necessary to confirm that such assignee or subtenant remains a Related Entity.
For the purposes of this Section 65.15, a "Related Entity" shall mean any
corporation, partnership, joint venture, limited liability company or other form
of business entity that controls, is controlled by, or is under common control
with, Tenant.
62. SOLE REMEDY:
62.01 If Tenant shall request Landlord's consent or approval pursuant to
any of the provisions of this lease or otherwise, and Landlord shall fail or
refuse to give, or shall delay in giving, such consent or approval, Tenant shall
in no event make, or be entitled to make, any claim for damages (nor shall
Tenant assert, or be entitled to assert, any such claim by way of defense,
set-off, or counterclaim) based upon any claim or assertion by Tenant that
Landlord unreasonably withheld or delayed its consent or approval, and Tenant
hereby waives any and all rights that it may have from whatever source derived,
to make or assert any such claim. Tenant's sole remedy for any such failure,
refusal, or delay shall be an action for a declaratory judgment, specific
performance, or injunction, and such remedies shall be available only in those
instances where Landlord has expressly agreed in writing not to unreasonably
withhold or delay its consent or approval or where, as a matter of law, Landlord
may not unreasonably withhold or delay the same.
62.02 Notwithstanding the foregoing, if a dispute or disagreement shall
arise between Landlord and Tenant as to whether or not the withholding or
delaying of Landlord's consent or approval under Articles 3 or 61 hereof is
unreasonable, Tenant shall have the right to send a notice to Landlord electing
either (i) to have such dispute resolved by determination pursuant to the
Simplified Procedure For Court Determination of Disputes as set forth in the
CPLR ss.3031 et seq. (or any successor thereto), or (ii) to submit such dispute
for arbitration under the Expedited Procedures provisions (presently Rules 54
through 58, as same may be amended from time to time) of the American
Arbitration Association (or successor thereto) in the City of New York (and the
fees and expenses of such arbitration shall be borne by the unsuccessful party),
and, in either case, the decision shall be final and conclusive on the parties.
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63. CHANGES IN BUILDING FACILITIES:
63.01 Landlord reserves the right to, at any time, and may, without same
constituting an eviction and without incurring any liability to Tenant therefor,
make such changes (including changes in arrangement and location) in or to the
Building, and the fixtures and equipment thereof that do not exclusively serve
the demised premises, as well as in or to the street or public entrances, halls,
passages, passageways, doors, doorways, corridors, elevators, stairs, stairways,
toilets and other portions thereof, as it may deem necessary or desirable.
Except for any of the foregoing changes that are required by a Legal and
Insurance Requirement, Owner agrees that no such change will materially
adversely affect the use of, access to and from (including, without limitation,
loading and unloading), and visibility of, the demised premises, the equipment
outside the demised premises that services the demised premises or the
storefront, the freight elevator of the Building and the fire stairs serving the
demised premises.
64. MISCELLANEOUS:
64.01 Conflict Of Terms: In the event any term, covenant, condition or
agreement contained in this Rider to the lease shall conflict or be inconsistent
with any term, covenant, condition or agreement contained in the printed portion
of this lease, then the parties agree that the Rider provision shall prevail.
64.02 Saving Provision: If any provision of this lease, or its
application to any situation shall be invalid or unenforceable to any extent,
the remainder of this lease, or the application thereof to situations other than
that as to which it is invalid or unenforceable, shall not be affected thereby,
and every provision of this lease shall be valid and enforceable to the fullest
extent permitted by law.
64.03 Lease Not Binding Unless 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.
64.04 Entire Agreement, Successors and Assigns: This lease constitutes
the entire agreement between the parties hereto and no earlier statement or
prior written matter shall have any force or effect. Landlord and Tenant agree
that it is not relying on any representations or agreements other than those
contained in this lease. This agreement shall not be modified or cancelled
except by writing subscribed by both parties. The lease shall not be modified or
cancelled except by written instrument subscribed by both parties. The
covenants, conditions and agreements contained in this lease shall bind and
inure to the benefit of Landlord and Tenant and their respective heirs,
distributees, executors, administrators, successors and except as otherwise
provided in this lease, their assigns.
65. EMINENT DOMAIN:
65.01 If the whole of the Building shall be lawfully taken by
condemnation or in any other manner for any public or quasi-public use or
purpose, this lease and the term and estate hereby granted shall forthwith
terminate as of the date of vesting of title in such taking (which date is
hereinafter also referred to as the "date of the taking"), and the rents shall
be prorated and adjusted as of such date.
42
65.02 If only a part of the Building shall be so taken, this lease shall
be unaffected by such taking, except that Tenant may elect to terminate this
lease in the event of a partial taking, if the remaining area of the Demised
Premises shall not be reasonably sufficient for Tenant to continue feasible
operation of its business. Tenant shall give notice of such election to Landlord
not later than thirty (30) days after (i) notice of such taking is given by
Landlord to Tenant, or (ii) the date of such taking, whichever occurs later.
Upon the giving of such notice by Tenant this lease shall terminate on the date
of such taking and the rents shall be prorated as of such termination date. Upon
such partial taking and this lease continuing in force as to any part of the
Demised Premises, the Fixed Rental and Tenant's Proportionate Share shall be
prorated and adjusted as of the date of taking and from such date the Fixed Rent
and Tax Payment shall be prorated and payable pursuant to Articles 41 and 42
according to the rentable area remaining.
65.03 Landlord shall be entitled to receive the entire award in any
proceeding with respect to any taking provided for in this Article without
deduction therefrom for any estate vested in Tenant by this lease and Tenant
shall receive no part of such award, except as hereinafter expressly provided in
this Article. Tenant hereby expressly assigns to Landlord all of its right,
title and interest in or to every such award. Notwithstanding anything herein to
the contrary, Tenant may, at its sole cost and expense, make a claim with the
condemning authority for Tenant's moving expenses, the value of Tenant's
fixtures or Tenant's Changes which do not become part of the Building or
property of the Landlord, provided however that Landlord's award is not thereby
reduced or otherwise adversely affected.
65.04 If the temporary use or occupancy of all or any part of the
Demised Premises shall be lawfully taken by condemnation or in any other manner
for any public or quasi-public use or purpose during the term of this lease,
Tenant shall be entitled, except as hereinafter set forth, to receive that
portion of the award for such taking which represents compensation for the use
and occupancy of the Demised Premises and, if so awarded, for the taking of
Tenant's Property and for moving expenses, and Landlord shall be entitled to
receive that portion which represents reimbursement for the cost of restoration
of the Demised Premises. This lease shall be and remain unaffected by such
taking and Tenant shall continue responsible for all of its obligations
hereunder insofar as such obligations are not affected by such taking and shall
continue to pay in full the Fixed Rental and Additional Rent when due. If the
period of temporary use or occupancy shall extend beyond the Expiration Date,
that part of the award which represents compensation for the use or occupancy of
the Demised Premises (or a part thereof) shall be divided between Landlord and
Tenant so that Tenant shall receive so much thereof as represents the period
prior to the Expiration Date and Landlord shall receive so much thereof as
represents the period subsequent to the Expiration Date. All moneys received by
Tenant as, or as part of, an award for temporary use and occupancy for a period
beyond the date to which the rents hereunder have been paid by Tenant shall be
received, held and applied by Tenant as a trust fund for payment of the rents
falling due hereunder.
65.05 In the event of any taking of less than the whole of the Building
or the demised premises which does not result in a termination of this lease, or
in the event of a taking for a temporary use or occupancy of all or any part of
the Demised Premises which does not extend beyond the Expiration Date, Landlord,
at its expense, shall proceed with reasonable diligence to repair, alter and
restore the remaining parts of the Building and the Demised Premises to
substantially a building standard
43
condition to the extent that the same may be feasible and so as to constitute a
complete and tenantable Building and Demised Premises.
65.06 Any dispute which may arise between the parties with respect to
the meaning or application of any of the provisions of this Article shall be
determined by arbitration in the manner provided in Article 60.
66. SELF-HELP:
66.01 For the purposes of this Article, a "Required Obligation" shall
mean an obligation of Owner which is expressly provided for in this lease and
which, if not being performed, (a) actually, materially and adversely interferes
with (i) Tenant's conduct of its business within the demised premises, provided
such business is expressly permitted by this lease, (ii) the performance or
completion of Tenant's Work, (iii) access to, or visibility of, the demised
premises, or (iv) Tenant's actual attempts to assign this lease or sublet the
entire demised premises (but only if pursuant to the applicable provisions of
Article 61 above, Landlord's consent is not required for the proposed assignment
or subletting in question or Landlord has agreed that its consent thereto shall
not be unreasonably withheld, delayed or conditioned), (b) has created an
emergency condition, which, for the purposes of this Article, shall be deemed to
mean an immediate threat of personal injury, loss of life or property damage. If
Landlord fails to perform a Required Obligation and is not diligently and in
good faith attempting to comply with the Required Obligation in question, then
provided that Tenant shall be the Tenant named herein or a Related Entity, and
shall not be in default in its obligation to pay Fixed Rental or any item of
Additional Rent and shall not be in default (after the giving of any required
notice and the expiration of any applicable cure period) under any other term,
covenant or condition in this lease on Tenant's part to observe, perform or
comply with, Tenant, at Tenant's election (but without any obligation so to do),
may perform any of such Required Obligations (at Tenant's sole risk) for the
account of Landlord; provided, however, that Tenant shall not exercise its
rights under this Section 66.01 unless Landlord shall have failed to perform any
of such Required Obligations within five (5) business days after Tenant shall
have given notice to Landlord and the holders of all superior mortgages and the
lessors of all superior leases whose names and addresses have been furnished to
Tenant, of the need for Landlord to perform the same, or in the case of a
Required Obligation that cannot with due diligence be completed or performed
within a period of five (5) business days, if Landlord, within such five (5)
business day period, shall not have committed in writing to Tenant to perform
same, or shall not have instituted steps to commence such completion or
performance within ten (10) days after receiving such notice from Tenant, or
shall thereafter not diligently prosecute the same until completion. (For the
purposes of clarification, giving such notice to said holders and lessors shall
not give such holders or lessors any additional time to cure Landlord's default
in performing a Required Obligation.) Notwithstanding anything contained in
Article 27 above to the contrary, such notices to Landlord that are to be given
after the Building (other than the demised premises) are open for business,
shall be given to Landlord at the Building, as such address may be changed by
notice to Tenant given pursuant to said Article 27. In addition, in the case of
an emergency condition, the five (5) business day period shall be reduced to a
period that is reasonable under the circumstances, the notice to Landlord may be
an oral notice (followed immediately by a written notice to the appropriate
address by telecopier and by overnight courier), and the ten (10) day period
shall be similarly reduced.
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66.02 Landlord shall pay to Tenant the cost (the "Self-Help
Reimbursement Cost"), to the extent reasonably incurred by Tenant, of performing
such Required Obligations for the account of Landlord pursuant to Section 66.01
above, within thirty (30) days after Landlord receives Tenant's demand therefor,
which demand (the "Self-Help Reimbursement Notice") shall describe, in
reasonable detail, the items which comprise the Self-Help Reimbursement Cost,
and shall be accompanied by receipted bills, invoices and such other information
or documents reasonably required by Landlord to verify the Self-Help
Reimbursement Cost. If Landlord fails to pay the Self-Help Reimbursement Cost
within said thirty (30) day period, then the next succeeding monthly
installments of Fixed Rental payable under this lease shall be reduced by the
then outstanding balance of the Self-Help Reimbursement Cost, plus interest
thereon at the fluctuating annual rate described in subsection 52.02(b)(ii) (but
not to an amount which is less than one ($1.00) dollar per month) until such
time as, and to the extent that, the amount of Fixed Rental that would have been
payable under this lease (but for such reduction) equals the Self-Help
Reimbursement Cost.
66.03 If Tenant performs any Required Obligations in accordance with,
and subject to, the provisions of this Article, then each and every Self-Help
Reimbursement Notice shall be conclusive and binding upon Landlord, unless
within thirty (30) days after the later of (a) the date on which Landlord
receives the Self-Help Reimbursement Notice, and (b) the date on which Landlord
receives the bills, invoices, receipts and other information or documentation
reasonably required by Landlord as hereinafter provided, Landlord shall notify
Tenant that Landlord disputes the correctness thereof, specifying (to the extent
known to Landlord) the particular respects in which such Self-Help Reimbursement
Notice is incorrect. If Landlord and Tenant fail to settle such dispute within
ninety (90) days after Landlord so notifies Tenant, such dispute shall be
determined by arbitration pursuant to Article 68 hereof. Pending the settlement
of such dispute by agreement between Landlord and Tenant or by arbitration as
aforesaid, Landlord shall not be obligated to pay to Tenant fifty (50%) percent
any portion of the Self-Help Reimbursement Cost that Landlord has reasonably and
in good faith disputed, and Tenant shall not be entitled to reduce the Fixed
Rental with respect thereto. If as a result of such arbitration it is determined
that the portion of the Self-Help Reimbursement Cost paid by Landlord (or being
paid by Landlord in the form of a Fixed Rental credit) is less than the amount
owed by Landlord, then the underpayment (plus accrued interest thereon at the
rate set forth in subsection 52.02(b)(ii)) shall, at Landlord's option, be paid
to Tenant within thirty (30) days after the arbitration decision is rendered and
received by Landlord, or be added to the Fixed Rental credit. If as a result of
such arbitration it is determined that the portion of the Self-Help
Reimbursement Cost paid by Landlord (or being paid by Landlord in the form of a
Fixed Rental credit) is more than the amount owed by Landlord, then the
overpayment to the extent paid by Landlord (plus the interest thereon at the
rate set forth in said subsection 52.02(b)(ii)) shall be refunded by Tenant to
Landlord within thirty (30) days after the arbitration decision is rendered and
received by Tenant. To the extent such overpayment has not yet been paid by
Landlord, the Fixed Rental credit shall be reduced by such overpayment, plus all
interest that accrued on such overpayment. Tenant shall grant to Landlord
reasonable access to Tenant's books and records for the purpose of verifying the
Self-Help Reimbursement Cost and the information contained in the Self-Help
Reimbursement Notice and shall, within thirty (30) business days after
Landlord's request therefor, submit to Landlord bills, invoices, receipts and
any other information or documentation reasonably required by Landlord to verify
the Self-
45
Help Reimbursement Cost and the information contained in the Self-Help
Reimbursement Notice.
67. HAZARDOUS MATERIALS:
67.01 Tenant shall not cause or permit "Hazardous Materials" (as defined
below) to be used, transported, stored, released, handled, produced or installed
in, on or from, the demised premises or the Building, except to the extent
necessary to use the demised premises for the purposes expressly permitted under
this lease, and only in compliance with applicable Legal Insurance Requirement.
The term "Hazardous Materials" shall, for the purposes hereof, mean any
flammable explosives, radioactive materials, hazardous wastes, hazardous and
toxic substances, or related materials, asbestos or any material containing
asbestos or any other substance or material, as defined by any federal, state or
local environmental law, ordinance, rule or regulation including, without
limitation, the Comprehensive Environmental Response Compensation and Liability
Act of 1980, as amended, the Hazardous Materials Transportation Act, as amended,
the Resource Conservation and Recovery Act, as amended, and in the regulations
adopted and publications promulgated pursuant to each of the foregoing. In the
event of a breach of the provisions of this Article 67, Landlord shall, in
addition to all of its rights and remedies under this lease and pursuant to law,
require Tenant to remove any such Hazardous Materials from the demised premises
in the manner prescribed for such removal by the applicable law, ordinance, rule
or regulation. The provisions of this Article 67 shall survive the termination
of this lease.
67.02 Landlord certifies that there are no Hazardous Materials in the
demised premises and agrees that if the demised premises contains any Hazardous
Materials (not brought to the demised premises by Tenant or any of its agents,
employees, contractors or other persons or entities claiming by, through or
under Tenant) which are not in compliance with applicable statutes, laws or
regulations, Landlord shall, at Landlord's sole cost and expense, promptly
eliminate said Hazardous Materials and restore the demised premises. To the
extent that Tenant shall not be able to safely use and occupy the demised
premises during the elimination of such Hazardous Materials by Landlord, rent
and all other charges shall ▇▇▇▇▇ until the Hazardous Materials are eliminated
and the demised premises is restored.
67.03 Landlord shall not cause or permit Hazardous Materials to be used,
transported, stored, released, handled, produced or installed in, on or from the
balance of the Building, except to the extent necessary to operate the balance
of the Building, and only in compliance with Legal and Insurance Requirements.
68. ARBITRATION:
68.01 Either party may request arbitration of any matter in dispute with
respect to which arbitration is expressly provided in this lease as the
appropriate remedy. The party requesting arbitration shall do so by giving
notice to that effect to the other party, and both parties shall promptly
thereafter jointly apply to the American Arbitration Association (or any
organization successor thereto) in the City and County of New York for the
appointment of a single arbitrator.
68.02 The arbitration shall be conducted in accordance with the then
prevailing rules of the American Arbitration Association (or any organization
successor thereto) in the City and County of New York and, subject to the terms
of the immediately succeeding sentence, judgment on the award rendered by the
arbitrator may entered in any court having jurisdiction
46
thereof. In rendering such decision and award, the arbitrator shall not add to,
subtract from, or otherwise modify the provisions of this lease.
68.03 If, for any reason whatsoever, a written decision and award of the
arbitrator shall not be rendered within sixty (60) days after the appointment of
such arbitrator, then, at any time thereafter before such decision and award
shall have been rendered, either party may apply to the Supreme Court of the
State of New York or to any other court having jurisdiction and exercising the
functions similar to those now exercised by such court, by action, proceeding,
or otherwise (but not by a new arbitration proceeding) as may be proper to
determine the question in dispute consistently with the provisions of this
lease.
68.04 All the expenses of the arbitration shall be borne by the parties
equally.
69. CONDOMINIUM:
69.01 Landlord hereby represents to Tenant, and Tenant acknowledges,
that Landlord is contemplating the conversion of the Building to the condominium
form of ownership and that such form of ownership may be effective, if at all,
before, on or after the Commencement Date, the effective date of such conversion
being herein referred to as the "Conversion Effective Date."
69.02 Tenant further acknowledges that in connection with such
conversion, Landlord may require an amendment to this lease which, inter alia,
reflects the fact that the demised premises will become a condominium unit, and
accordingly, will be assessed and billed for real estate tax and other purposes
separately from the balance of the Building; the balance of the Building may be
owned by one (1) or more persons or entities other than Landlord; and that from
and after the Conversion Effective Date this lease and all of Tenant's rights
and remedies hereunder shall be subject and subordinate in all respects to the
Condominium Documents (as hereinafter defined) and Tenant, and all persons and
entities claiming by, through or under Tenant, shall be bound in all respects by
the Condominium Documents, except to the extent that the Condominium Documents
increase any of Tenant's obligations under this lease, or reduce any of Tenant's
rights or remedies under this lease, and provided such Condominium Documents
have been approved by Tenant, which approval Tenant covenants and agrees shall
not be unreasonably withheld, conditioned or delayed. For the purpose of this
lease, "Condominium Documents" shall mean the declaration, by-laws and rules and
regulations, as same may be from time to time amended or modified, of the
Condominium. Tenant agrees to cooperate in good faith with Landlord in
connection with such conversion, and promtply to execute, acknowledge and
deliver an amendment to this lease which contains said provisions and such other
provisions that Landlord reasonably deems necessary in connection with such
conversion, and such other documents, instruments and agreements that Landlord
may reasonably request in connection with such conversion, provided that such
amendment and such other documents, instruments and agreements are in all
respects reasonably satisfactory, in form and substance, to Tenant. Landlord
shall reimburse Tenant for the reasonable attorneys' fees and disbursements
actually paid to Tenant's outside counsel for reviewing the Condominium
Documents and for reviewing and negotiating such lease amendment and other
documents, instruments and agreements, up to $10,000.00, in the aggregate, if
the first drafts of substantially all of such Condominium Documents or lease
amendment and other documents, instruments and agreements are delivered (in good
faith) to Tenant for its review within the
47
one (1) year period commencing on the date of this lease, and $15,000.00, in the
aggregate, if the first of any of such documents are delivered after such one
(1) year period, Tenant hereby agreeing that all attorney's fees and
disbursements incurred by Tenant in connection with the negotiation, drafting or
execution of this lease, or any other contemporaneous agreements related to this
lease, or Tenant's use of any portion of the Building, shall not be so
reimbursed. Landlord shall pay such fees and disbursements within thirty (30)
days after it receives a demand therefor, accompanied by an invoice and detailed
billing report.
70. CONFIDENTIALITY; MEMORANDUM:
70.01 Without the prior written consent of Landlord or Tenant, as the
case may be, in each instance, neither the other party nor any of its officers,
shareholders, directors, employees or representatives (including, without
limitation, its attorneys and accountants), shall disclose, divulge, communicate
or otherwise reveal to any person, the business provisions (including the rental
and other financial provisions) of this lease or any other document or agreement
executed or delivered in connection with this lease, except and only to the
extent, the other party becomes legally compelled (by deposition, interrogatory,
request for documents, subpoena, civil investigative demand or similar process)
to disclose such provisions, in which event the party being compelled shall
provide the other party with prompt prior written notice of such requirement so
that the other party may seek a protective order or other appropriate remedy
and/or waive compliance with the terms of this Section. In the event that such
protective order or other remedy is not obtained, the party being so compelled
shall furnish only such provisions of this lease which such party is advised (by
written opinion of counsel) is legally required to be so disclosed, divulged,
communicated, or otherwise revealed. The term "person" as used in this Section
will be interpreted broadly to include, without limitation, any individual,
corporation, company, partnership or other business entity, or any governmental
or quasi-governmental authority. The provisions of this Section shall not apply
to the disclosure, divulgence, communication or other revelation to either
party's attorneys, accountants or other professional consultants or advisors, to
a prospective or existing holder of a superior mortgage or lessor under a
superior lease, a prospective purchaser or assignee of Landlord's or Tenant's
interest in the Building or this Lease, or a prospective subtenant of the
Demised Premises or to the extent required by securities laws or compliance
provisions of other Legal and Insurance Requirements. Except for disclosures
required by such securities laws or compliance provisions of other Legal and
Insurance Requirements, Landlord and Tenant agree to use their respective best
efforts to obtain assurances from the persons to whom Landlord or Tenant, as the
case may be, is required or permitted to disclose, divulge, communicate or
otherwise reveal such information to keep such information confidential in
accordance with this Section 70.01.
70.02 Neither Landlord nor Tenant shall be permitted to record this
lease. At the request of either Landlord or Tenant, the other party shall
promptly execute, acknowledge and deliver a memorandum with respect to this
lease containing the minimum information, and in form necessary, for recording.
Such memorandum shall not under any circumstances be deemed to change or
otherwise affect any of the obligations or provisions of this lease. The party
requesting such memorandum shall pay all filing and recording fees in connection
therewith, and for the preparation thereof.
48
71. ADDENDUM TO ARTICLE 20:
71.01 Notwithstanding anything contained in Article 20 of this lease
which may be deemed to the contrary, Landlord and Tenant hereby acknowledge the
existence of the letter agreement referred to in Article 9 above with respect to
a portion of the subcellar of the Building.
IN WITNESS WHEREOF, Landlord and Tenant have executed this lease as of
the date first above written.
LANDLORD:
THE SOHO HOTEL COMPANY, L.P.
By: Hotel Corporation of America,
the General Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
_________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
Vice-President
TENANT:
▇▇▇▇▇ ▇▇▇▇▇▇, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 1/23/96
_________________________
Name:
Title:
49
COMMONWEALTH OF MASSACHUSETTS )
)ss.:
COUNTY OF SUFFOLK )
On this 25th day of January, 1996, before me personally came ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, to me known, who, being by me duly sworn, did depose and say that he
resides in Weston, Massachusetts; that he is a Vice-President of Hotel
Corporation of America, the corporation which is the general partner of THE SOHO
HOTEL COMPANY, L.P., the firm described in and which executed the above
instrument; and that he signed his name thereto by order of the board of
directors of said corporation.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Notary Public
My commission expires 7/6/01
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On this 23 day of January, 1996, before me personally came ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, to me known, who, being by me duly sworn, did depose and say that he
resides in Grenwich, Connecticut; that he is the President of ▇▇▇▇▇ ▇▇▇▇▇▇,
INC., the corporation described in and which executed the above instrument; and
that he signed his name thereto by order of the board of directors of said
corporation.
/s/ ▇▇▇▇▇▇▇▇▇ Arena
--------------------------------
Notary Public
50
===============================================================================
EXHIBIT A
FLOOR PLAN
===============================================================================
(follows immediately)
51
{Mechanical Drawing--Ground Level}
{Mechanical Drawing--Cellar Level}
===============================================================================
EXHIBIT B
INTENTIONALLY OMITTED
===============================================================================
===============================================================================
EXHIBIT C
SPECIAL PERMIT RESOLUTION
===============================================================================
(follows immediately)
===============================================================================
EXHIBIT D
DECLARATION, AS MODIFIED
===============================================================================
(follows immediately)
================================================================================
EXHIBIT E
SIGN
===============================================================================
(follows immediately)
===============================================================================
EXHIBIT F
LANDLORD'S WORK
===============================================================================
A. Landlord shall, at its expense, furnish and install the following
on or before the dates set forth below:
Phase I - on or before April 11, 1996 (the "Phase I Landlord's Work"):
1. The preparation of two (2) drawings per floor with demised premises
keyed to partition drawing and coordination drawing indicating required
core building system access.
2. Vanilla box enclosure for demised premises consisting of:
a. completed 2 hour fire-rated walls with taped sheet rock and cinder
block or masonry;
b. 2-hour fire-rated taped sheet rock ceilings;
c. smooth, level concrete floors, but not to close the stairwell
opening between the ground floor and cellar portions of the demised
premises; and
d. fire-rated doors at demising walls.
3. Stub-ups for restroom including water, waste and vent lines located
in the rear quadrant of the cellar level.
4. Sprinkler loop in the demised premises with connection to Building
standpipe system.
5. Smoke exhaust system.
6. Owner to determine and notify Tenant of location for electric, gas and
water meters.
7. Storefront.
8. All pipes, ducts, cables, conduits and equipment (collectively, the
"Base Building Equipment") that will service portions of the Building
outside the demised premises, but which are to be installed in or
through the demised premises as part of the base building work.
Phase II - on or before July 11, 1996:
9. Completion of standpipe system necessary to operate Tenant's sprinkler
system in the demised premises.
10. Completed core fire egress for cellar and subcellar. This includes fire
egress for other space in the floor through demised premises fire egress
and demised premises through fire egress for other space on the floor.
Landlord's Work only pertains to that portion of fire egress outside of
the demised premises.
11. Building freight elevator (As Tenant's sole remedy, Landlord agrees to
reimburse Tenant for Tenant's actual, direct out-
of-pocket cost of hauling goods to Tenant's storage area if the Building
freight elevator is not operational within one (1) month prior to the
date on which Tenant opens the demised premises for the regular conduct
of its business to the public or September 1, 1996, whichever is later,
until the freight elevator is operational).
12. Connection of Tenant's Class J system equipment to the Building's Class
J system panel, but only if Tenant has, at Tenant's sole cost and
expense, brought the wires from its equipment to such panel. If Tenant
has not done so by such July 11, 1996 date, then Landlord shall make
such connection promptly after Tenant does so.
13. The work that is expressly set forth in the Second Modification of
Declaration referred to in Section 44.04 of this lease as being
necessary to obtain a temporary certificate of occupancy for the retail
portion of the Building, without any representation or warranty by
Landlord as to whether a temporary certificate of occupancy will be
issued to permit the retail use of the demised premises after such work,
all other Landlord's Work and Tenant's Work is substantially completed.
To the extent the location of any item of Landlord's Work (including the
Base Building Equipment) is not specified above, same shall be in a
location reasonably determined by Landlord and Tenant. In addition,
unless otherwise expressly specified in this lease, all Landlord's Work
shall be of equipment and materials that Landlord shall have reasonably
determined to be Building Standard, provided such work and materials are
otherwise first-class for the work in question.
Phase III - on or before September 15, 1996:
1. Installation in the portions of the cellar and subcellar of the Building
not demised to Tenant under this lease or covered by the letter
agreement referred to in Articles 9 and 71 above, of sprinklers for full
protection and fire rated ceilings.
B. TENANT DELAYS
The dates set forth in the Lease (including this Exhibit F) for the
completion or substantial completion of the Landlord's Work are subject
to extension by the number of days Landlord is delayed in substantially
completing same by Tenant or any person or entity claiming by, through
or under Tenant (including, without limitation, Tenant's employees,
agents and contractors) or for any of the reasons described in Article
26 above, subject to the ninety (90) day limitation set forth in
subsections 49.01(b) and (c) with respect to said Article 26, and the
provisions of subsection 49.01(g) with respect to said Article 26.