AGREEMENT OF LEASE
BY AND BETWEEN:
▇▇▇▇▇▇ ENTERPRISES LLC
AND
ALLIED DIGITAL TECHNOLOGY CORP.
as "TENANT"
THIS LEASE, made as of the 16th day of September, 1996 between ▇▇▇▇▇▇
ENTERPRISES LLC., a New York limited liability corporation having an address at
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (hereinafter referred to as
"Landlord") and ALLIED DIGITAL TECHNOLOGY CORP., a corporation organized under
the laws of the State of Delaware and maintaining an office for the transaction
of business at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (hereinafter referred
to as "Tenant").
WITNESSETH
WHEREAS, Landlord is the owner of the office building (the "Building")
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, situate on the real
property (the "Property") described on Exhibit "A" annexed.
NOW THEREFORE, in consideration of the covenants hereinafter
contained, the Landlord agrees to lease the Premises hereinafter described to
the Tenant and the Tenant agrees to lease the Premises from the Landlord and
operate an office therein as part of the Building upon the terms and conditions
set out in this agreement.
SECTION 1
PREMISES: (A) Landlord hereby leases unto Tenant and Tenant hereby
hires from Landlord the following described premises (hereinafter sometimes
referred to as (the "Premises") or "Demised Premises"): Entire south side of the
third floor of the Building, comprising 7,000 rentable square feet together with
the use in common with others of the first and third floor corridors and third
floor restrooms; and parking facilities.
SECTION 2
TERM AND COMMENCEMENT: The term of this lease (hereinafter referred to
as ("Term") shall be for a period of five (5) years one and one-half months from
September 15, 1996 to October 31, 2001.
SECTION 3
RENT: (A) Tenant shall pay to Landlord in such coin or currency of the
United States of America as at the time of payment shall be legal tender for the
payment of public and private debts in the manner and at the address specified
on the first page hereof, during the term, the annual rent as indicated on
Exhibit "B" annexed. Such rental shall be paid in equal monthly installments in
advance on the first day of each and every month beginning on the commencement
date as hereinbefore defined.
(B) Rent Concession: Provided that Tenant has furnished evidence
of insurance as set forth in Section 37 hereof, Tenant may take occupancy of the
premises on September 15, 1996, and shall not be liable for the payment of rent
for the period ending October 31, 1996.
(C) Late Charges: If Landlord does not receive the entire rent
for any month during the term of this lease prior to the tenth day of such
month, Tenant shall pay, as additional rent, a late charge of five (5%) per cent
of such monthly rent.
SECTION 4
TENANTS PROPORTIONATE SHARE: Tenant's proportionate share for taxes
shall be 15.8%.
SECTION 5
ADDITIONAL RENT: Tenant agrees to pay Landlord, throughout the term of
this lease (including any renewal or extension period) Tenant's "Proportionate
share" any increases in Taxes hereinafter defined over and above Landlord's
Taxes
2
for the 1996-1997 lien year.
(A) Taxes: Taxes as defined herein shall mean all general and
special real estate taxes and special assessments and water and sewer charges,
which Landlord shall pay, subject to the following:
(i) The amount of real property taxes against Landlord's real property
to be included shall be the amount shown by the tax bills for the lien year in
respect of which the Taxes are being determined. There shall be deducted from
said Taxes the net amount of any refunds, after reasonable expenses, such
refunds to be applied against said Taxes for the same calendar year to which the
taxes apply.
(ii) The amount of special taxes or special assessments to be included
shall be limited to the amount of the installments of special taxes or special
assessments required to be paid during the lien year in respect to which these
special taxes or special assessments are to be determined; however, Landlord
shall elect the longest period of time allowed by the authority imposing the tax
or assessment in which to pay installments of special taxes or special
assessments and in no event shall such special taxes or special assessments be
prorated over a period of less than five years.
(iii) If due to a future change in the method of taxation any tax is
levied against Landlord in substitution for or in lieu of general real estate
taxes and special real estate taxes, then such taxes to such extent shall be
deemed to be a real estate tax for the purpose hereof.
(iv) State income tax (as presently constituted) or any local income
tax (to the extent that it is not in lieu of real estate taxes) payable by
Landlord shall not be included in Taxes, but shall be the sole responsibility of
the Landlord. If there is an additional assessment because of improvements made
by Tenant in the Premises that are not standard office improvements and said
additional improvements meaningfully
3
affect the assessment at the time of the original assessment, the amount of the
assessment or taxes attributable to such improvements shall be paid by Tenant.
(v) There shall be excluded from Taxes all federal income taxes1
federal excess profits taxes, franchise, capital stock, and federal or state
inheritance or estate taxes.
(vi) There shall be excluded from taxes in connection with any major
change in the Building such as adding or deleting floors.
(B) Payment of Taxes
Not later than February 1 of each year Landlord shall deliver to
Tenant, a copy of the Tax ▇▇▇▇ for the current year together with a computation
of Tenant's proportionate share, and Tenant shall pay its proportionate share of
any increase not later than thirty (30) days from receipt of such computation
and the report operating expenses as provided in subsection (A) hereof.
SECTION 6
USE: Tenant agrees and covenants that it shall use the premises solely
as office space for the operation of general office services related to, the
corporate headquarters for tenant and its subsidiaries and related services and
for no other purpose without the prior written consent of Landlord. Tenant will
not permit any part thereof to be used in any manner which would in any way (i)
violate any of the provisions of any mortgage to which this lease is
subordinate, (ii) violate any laws or requirements of all governmental
authorities and the Fire Rating Organization and Board of Fire Underwriters, and
any similar bodies having jurisdiction thereof, (iii) make void or voidable any
fire or liability insurance policy then in force with respect to the Premises or
the Building of which they are a part, (iv) constitute a public or private
nuisance, (v) impair the appearance, character, or reputation of the Building,
(vi) cause Tenant to default in any of its other obligations under this lease,
(vii) violate any
4
zoning or occupancy conditions imposed by any municipality or governmental
regulations to be applicable to the Premises or the Building.
SECTION 7
REPAIRS: (A) Landlord shall not be required to make any repairs to the
Premises, except as specifically set forth in this lease.
(B) During the entire term of this lease, Tenant shall at
Tenant1s expense keep and maintain the premises in good order, condition and
repair and maintain, repair and replace, when necessary, appurtenances,
alterations, additions, and improvements to same, including all windows and
doors, signs, floor covering, ceiling tile and light bulbs and make all
necessary non-structural repairs and replacements with respect to the premises.
The common areas shall not be maintained by the Tenant.
(C) Landlord shall make all repairs necessary to preserve and
maintain the exterior and structure of the Premises including the foundation,
down spouts, gutters, and roof of the entire Building and including all repairs
and maintenance of heating, ventilating and air conditioning (HVAC) systems,
plumbing fixtures and water and sewer pipes serving the Premises, except that
Tenant shall be solely responsible to the extent that any repair is required by
reason of the negligent act or omission of Tenant, its employees, invitees,
agents, contractors, concessionaires and/or subtenants.
(D) Tenant agrees to keep the Premises clean and free from dirt
and other refuse matter, and continuously keep and maintain every part and
portion of the Premises in good order and repair, reasonable wear excepted. It
is the understanding and intention of the parties hereto that all interior
repairs of a minor nature (for purposes of this paragraph, costing under $500.00
per item) shall be the responsibility of the Tenant.
5
SECTION 8
COMPLIANCE WITH LAW: Tenant shall in the use and occupancy of the
premises conform to all laws, orders, and regulations of the Federal, State, and
Municipal governments, or any of their departments, and regulations of the New
York Board of Fire Underwriters, applicable to the premises.
SECTION 9
SUBORDINATION: It is a condition of this Agreement and the Tenant's
rights granted hereunder that this Agreement and the lease and all the rights of
the Tenant hereunder and under the lease are subordinate to any and all
mortgages, trust deeds, or other instruments of financing, refinancing, or
collateral financing, from time to time in existence against the office
building. Upon request, Tenant will subordinate this agreement and the lease and
all of its rights hereunder and under the lease in such form as the Landlord
requires to any and all mortgages, trust deeds, or other instruments of
financing, refinancing, or collateral financing, as aforesaid. and will if
requested, attorn to the holder thereof or to the registered owners of the
office building as the case may be. If within 10 business days after request by
Landlord to Tenant to execute the instruments or certificates to give effect to
the foregoing the Tenant has not executed the same, the Landlord may at its
option terminate this agreement and the lease without liability on account.
SECTION 10
CONDEMNATION:
(A) Total or Substantial Partial Condemnation: If the whole of
the Premises shall be taken for any public or any quasi-public use by any
statute or by right of eminent domain, or by private purchase in lieu thereof,
then this lease shall automatically terminate as of the date that title shall be
taken. If any part of the Premises shall be so taken as to render the remainder
thereof unusable for the purposes for which the Premises were leased, then
Landlord and
6
Tenant shall each have the right to terminate this lease on thirty days notice
to the other given within ninety days after the date of such taking. In the
event that this lease shall terminate or be terminated, the rental(s) shall, if
and as necessary, be equitable adjusted.
(B) Partial Taking Where Lease Unaffected: If any part of the
Premises shall be so taken and this lease shall not terminate or be terminated
under the provisions of paragraph A hereof, then the rental shall be equitably
apportioned according to the space so taken and Landlord shall, at its own cost
and expense, restore the remaining portion of the Premises to the extent
necessary to render same reasonably suitable for the purposes for which the
Premises were leased and shall make all repairs to the Building in which the
Premises are located to the extent necessary to constitute the remaining portion
of the Building a complete architectural unit, provided that such work shall not
exceed the size of the original Building and the cost thereof shall not exceed
the proceeds of its condemnation award.
(C) Disposition of Proceeds: All compensation awarded or paid
upon such a total or partial taking of the Premises shall belong to and be the
property of the Landlord except that Tenant shall be entitled to retain any
amount awarded to it for moving expenses.
SECTION 11
SUMS EXPENDED BY LANDLORD TO BE ADDITIONAL RENT: In the event that the
Landlord shall pay any sum of money, or do any act which shall require the
expenditure of any sums by reason of the failure of the Tenant to perform any of
the covenants, terms or conditions herein contained, the Tenant covenants to
repay within 30 business days such sums to the Landlord upon demand, and in
default thereof the sums so paid by the Landlord, together with interest thereon
may be added as additional rent to the fixed rent becoming due upon the next
rent day, or any subsequent rent day and shall be payable as
7
such. Nothing contained herein shall be construed to post-pone the right of the
Landlord immediately upon expending such sums, to collect such sums with
interest by action or otherwise.
SECTION 12
DEFICIENCY: In any case where Landlord has recovered possession of the
Premises by reason of Tenant1s default, Landlord may at Landlord's option occupy
the Premises or cause the Premises to be redecorated, altered, divided,
consolidated with other adjoining Premises, or otherwise changed or prepared for
reletting, and may relet the Premises or any part thereof as agent of Tenant or
otherwise, for a term or terms to expire prior to, at the same time, or
subsequent to, the original expiration date of the lease at Landlord's option,
and receive the rent therefor, applying the same first to the payment of such
expenses as Landlord may have incurred in connection with the recovery of
possession, redecorating, not to exceed the original tenant finish allowance
provided to Tenant, altering, dividing, consolidating with other adjoining
premises, otherwise changing or preparing for reletting, including brokerage and
reasonable attorney's fees, and then to the payment of damages in amount equal
to the rent hereunder and to the cost and expense of performance of the other
covenants of Tenant as herein provided; and Tenant agrees, whether or not
Landlord has relet, to pay the Landlord damages equal to the rent and other sums
herein agreed to be paid by Tenant, less the net proceeds of the reletting, if
any, as ascertained from time to time, and the same shall be payable by Tenant
on the several rent days above specified. In reletting the Premises as
aforesaid, Landlord may grant rent concessions, and Tenant shall not be credited
therewith. No such reletting shall constitute a surrender and acceptance or be
deemed evidence thereof. If Landlord elects, pursuant hereto, actually to occupy
and use the Premises or any part thereof, during any part of the balance of the
term as originally fixed or since extended, there shall be allowed against
Tenant's obligation
8
for rent or damages as herein defined, during the period of Landlord's
occupancy, the reasonable value of such occupancy, not to exceed, in any event
the rent herein reserved, and such occupancy shall not be construed as a release
of Tenant's liability hereunder.
Tenant hereby waives all right of redemption to which Tenant or any
person claiming under Tenant might be entitled by any law now or hereafter in
force.
Landlord's remedies hereunder are in addition to any remedy allowed by
law.
SECTION 13
ENTIRE AGREEMENT: No oral statement or prior written matter shall
have any force or effect. No waiver of any provision of this agreement shall be
effective unless in writing, signed by the waiving party. Tenant agrees that it
is not relying on any representations or agreements other than those contained
in this lease. This agreement shall not be modified except by writing subscribed
by all parties, nor may this lease be cancelled by Tenant except with the
written consent of the Landlord, unless otherwise specifically provided herein.
SECTION 14
LANDLORD'S RIGHT TO CURE TENANT'S BREACH: If Tenant breaches any
covenant or condition of this lease, Landlord may, on reasonable notice to
Tenant (except that no notice need be given in case of emergency), cure such
breach at the expense of Tenant and the reasonable amount of all expenses,
including attorney's fees, incurred by Landlord in doing so (whether paid by
Landlord or not) shall be deemed additional rent payable on demand.
SECTION 15
MECHANIC'S LIEN: Tenant shall within thirty days after written notice
from Landlord discharge any mechanic's lien for materials or labor claimed to
have been furnished to the Premises on Tenant's behalf.
9
SECTION 16
LANDLORD'S RIGHT TO INSPECT AND REPAIR: may, but shall not be
obligated to, enter the Premises at any reasonable time, on reasonable notice to
Tenant (except that no notice need be given in case of emergency) for the
purposes of inspection or the making of such repairs replacements, and additions
in, to, on and about the Premises or the Building, as Landlord deems necessary
or desirable. Tenant shall have no claim or cause of action against Landlord by
reason thereof.
SECTION 17
ESTOPPEL CERTIFICATES: Tenant shall, without charge, at any time and
from time, within ten days after requested by Landlord, certify by written
instrument, duly executed, acknowledged and delivered, to Landlord, or any other
person, firm or corporation specified by Landlord:
(A) that this lease is unmodified and in full force and effect,
or, if there have been any modifications, that the same is in full force and
effect as modified and stating the modifications;
(B) whether or not there are then existing any set-offs or
defenses against the enforcement of any of the agreements, terms, covenants or
conditions hereof and any modification hereof upon the part of Tenant to be
performed or complied with, and, if so, specifying the same;
(C) the dates, if any, to which the base rent and additional rent
and other charges hereunder have been paid in advance;
(D) the date of expiration of the current term;
(E) and the base rent then payable under this lease.
SECTION 18
SURRENDER OF PREMISES: On the last day or sooner termination of the
demised term, Tenant shall quit and surrender the Premises broom-clean, in good
condition and repair (reasonable wear and tear excepted) together with all
10
alterations, additions and improvements which may have been made in, on or to
the Premises, except movable furniture or unattached movable trade fixtures put
in at the sole expense of Tenant; remove from the Premises all its property
together with any alterations, additions and improvements, the removal of which
is requested by Landlord, and any or all of such property not so removed shall,
at Landlord's option, become the exclusive property of Landlord or be disposed
of by the Landlord, at Tenant's cost and expense, without further notice to or
demand upon Tenant. If the Premises be not surrendered as and when aforesaid,
Tenant shall indemnify Landlord against loss or liability resulting from the
delay by Tenant in so surrendering the Premises including, without limitation,
any claims made by any succeeding occupant founded on such delay. Tenant's
obligations under this section shall survive the expiration or sooner
termination of the demised term.
SECTION 19
RULES AND REGULATIONS: Tenant and Tenant's agents, servants,
employees, invitees and licensees shall observe faithfully and comply strictly
with the Rules and Regulations attached hereto as Exhibit "D" and with any
modifications thereof and any additional rules and regulations which may from
time to time hereafter be adopted by Landlord for the Building of which the
Premises form a part. Notice of the adoption of any such modification or
additional rule or regulation shall be given to Tenant by Landlord. If Tenant
disputes the reasonableness off any such modification or additional rule or
regulation adopted by Landlord, the parties hereto agree to submit the question
of the reasonableness of such modification or additional rule or regulation for
decision to the Chairman of the Board of Directors of the Management Division of
The Real Estate Board of New York, Inc., or to such impartial person or persons
as he may designate1 whose determination shall be final and conclusive upon the
parties hereto.
11
SECTION 20
CONSENTS: Whenever the terms of this Lease require the consent or
approval of Landlord, Landlord agrees that such consent or approval will not be
unreasonably withheld or delayed.
SECTION 21
COMMON AREAS: Premises demised to Tenant shall include the right to
use in common with other tenants of the Building, their invitees, customers and
employees, the stairways, elevators halls, third floor toilet and sanitary
facilities contained in the Building, as well as the sidewalks, delivery areas
and parking facilities, and appurtenances thereto. Tenant shall have access to
the Premises at all times. Tenant's employees shall have the right to use on
site parking areas at no cost to Tenant or employee.
SECTION 22
INDEMNIFICATION/HOLD HARMLESS: Landlord will not be liable for any
damage or injury caused solely by Tenant on the Premises. Notwithstanding
anything contained in this lease to the contrary, Tenant will indemnify and hold
Landlord harmless for any claims or damages caused solely by an act or omission
of Tenant, its agents or employees that occurs on the Premises, and Landlord
will indemnify and hold harmless Tenant for any claims for damages caused by an
act or omission of Landlord, its agents or employees. Notwithstanding the
foregoing, the respective liability of Landlord and Tenant shall be limited to
the limits of liability insurance covering such occurrence provided further that
Tenant maintains the liability insurance policy described in Section 37 hereof.
SECTION 23
FIRE AND OTHER CASUALTIES: In the event the Building or Premises shall
be destroyed or rendered untenantable, either in whole or in part, Landlord may,
at it's option, restore the Building and Premises to the condition existing just
prior to
12
the casualty and Tenant's rent for that portion of the Premises rendered unfit
for occupancy shall ▇▇▇▇▇ until the Building and Premises have been fully
restored or this Lease has been terminated.
Within thirty (30) days of the date of the casualty, Landlord shall
give Tenant written notice indicating whether or not Landlord will restore the
Building and Premises. If Landlord elects to restore, the notice must indicate
how long the restoration is expected to take. If Premises are not restored
within one hundred and twenty (120) days from the date of such casualty to
substantially the same condition as before the casualty, Tenant shall have the
right to cancel this lease as of the date of the casualty.
(A) If Landlord does not give Tenant the required notice within
the thirty (30) day period or Landlord's notice does not include the required
information, Tenant may give Landlord a written notice indicating the default
and Landlord shall have ten (10) days from date of Tenant's notice to issue or
re-issue the notice. If at the end of the ten (10) day period Landlord has not
given Tenant said notice, this Lease shall expire and rent shall be abated from
the date of the casualty without further action on the part of either Landlord
or Tenant.
(B) If Landlord's notice indicates that Landlord does not intend
to restore the Building and Premises, this Lease shall terminate automatically
as of the date of the casualty without further action on the part of either the
Landlord or Tenant.
(C) If Landlord's notice indicates that Landlord intends to
restore and the restoration will not be substantially complete within one
hundred twenty (120) days from the date of casualty, Tenant shall have the
option to cancel this Lease by giving Landlord written notice within ten (10)
days of receipt of Landlord's notice.
In the event the Tenant should not cancel the Lease,
13
Landlord will proceed to restore the Building and Premises in accordance with
Landlord's notice to Tenant and Tenant's rent for the space unfit for occupancy
shall remain abated until the Premises are again tenantable, however, if the
restoration is not complete within 110% of the time indicated in Landlord's
notice, Tenant shall have an additional option to cancel this Lease by giving
Landlord written notice within ten (10) days.
(D) If Landlord's notice shall indicate that Landlord will
restore in one hundred twenty (120) days or less from the date of casualty, the
Landlord will proceed with the restoration and Tenant's rent for the space unfit
for occupancy shall remain abated until Premises shall again be tenantable,
however, if the restoration is not complete within 110% of the time indicated in
Landlord's notice, Tenant shall have the option to cancel this Lease by giving
Landlord written notice within ten (10) days.
SECTION 24
DEFAULT REMEDIES: If Tenant defaults in the payment of rent or
additional rent or defaults in the performance of any of the covenants or
conditions hereof, Landlord may give to Tenant notice of such default and if
Tenant does not cure any rent or additional roommate default within five (5)
days, or other default within fifteen (15) days, after the giving of such notice
(or, if such other default is of such nature that it cannot be completely cured
within such fifteen (15) days, if Tenant does not commence such curing within
such curing within such fifteen (15) days and thereafter proceed with reasonable
diligence and in good faith to cure such default), then Landlord may terminate
this Lease on not less than three (3) days notice to Tenant, and on the date
specified in said notice the term of this Lease shall terminate, and Tenant
shall then quit and surrender the Premises to the Landlord, but Tenant shall
remain liable as herein provided. If this lease shall have been so terminated by
Landlord, Landlord may at any time thereafter resume possession of the Premises
by any lawful
14
means and remove Tenant or other occupants and their effects.
TENANT'S REMEDIES: In the event of a breach of this lease by Landlord,
and Landlord's failure to cure such breach within thirty (30) days of Tenant's
written notice of breach to Landlord, or if claimed breach cannot be cured
within thirty (30) days, or if curative steps are not undertaken at the same
time and diligently pursued, Tenant will have the right of pursuing any other
remedies which Tenant may have at law or equity or under any state statute or
regulation. Should Tenant elect to cure Landlord's breach, Tenant may offset the
costs of cure incurred by Tenant against future sums due Landlord under this
lease and/or submit an invoice to Landlord specifying the amount due Tenant,
which amount Landlord will pay within ten (10) days of receipt of Tenant's
invoice. The election by Tenant of any remedy afforded Tenant will not be deemed
a waiver of any other remedies available to Tenant, Tenant's remedies being
cumulative.
SECTION 25
ASSIGNMENT AND SUBLETTING: Nothing will be construed as prohibiting
Tenant the right to assign this Lease or to sublet all or a portion of the
Premises to a company under common control or ownership with Tenant in which
case Tenant will give Landlord prompt written notification of the same. Any
other assignment or subletting may be made only with the consent of Landlord,
which shall not be unreasonably withheld or delayed.
SECTION 26
SIGNS: Tenant is granted permission to place a free-standing
identification sign not larger than two feet by two feet (2'x2') at the end of
the cul-de-sac adjoining the Building, provided that
(i) Tenant acquires, at Tenant's sole cost and expense, any
necessary municipal approvals; and
(ii) that Landlord approves the design of and materials used
in the construction of such sign, which
15
approval should not be unreasonably withheld or delayed. Tenant is granted the
right to display all company names (not exceeding 5), the names of pertinent
departments and individuals in the Building directory. All such signs shall be
identical in letter size1 color and material to the signage directory upon the
commencement of this lease.
SECTION 27
NOTICES: All notices under this Lease shall be sent by registered or
certified mail, return receipt requested, or delivered in person.
(A) Notices to Landlord shall be sent to Landlord at the address
set forth on the first page of this Lease.
(B) Any notice which either party may or is required to give,
will be given by registered or certified mail, return receipt requested, postage
prepaid, to the address(es) shown below, or at such other places as may be
designated by the parties from time to time:
To Landlord: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
with copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
To Tenant: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
with copy to:
▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Greshin, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, Esqs.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
SECTION 28
CARPET CARE: Tenant shall be required to equip all castered chairs
with two and one-half inch carpet casters to protect carpet and Landlord
acknowledges that doing so fulfills Tenant's obligation to protect the carpet.
SECTION 29
MUTUAL WAIVER OF SUBROGATION: Landlord and Tenant mutually agree to
endeavor to obtain from their respective
16
insurers permission to waive subrogation. In the event an insurer refuses to
grant such permission1 the insured will arrange to add the other party (Landlord
or Tenant as the case may be) as an Additional Insured. If any additional
premium is incurred as a result of this addition, it will be reflected as an
adjustment to the rent.
SECTION 30
JANITORIAL & WASTE REMOVAL: The Landlord shall furnish to the Tenant
cleaning and janitorial service1 including removal of refuse and rubbish and
furnish washroom supplies as defined in the Janitorial Schedule attached hereto.
Landlord shall also coordinate refuse sorting to meet municipal
recycling regulations.
SECTION 31
INTERRUPTION OF SERVICES OR USE: Interruption or curtailment of any
service maintained in the Building, if caused by strikes, mechanical
difficulties, or any causes beyond Landlord's control whether similar or
dissimilar to those enumerated, shall not entitle Tenant to any claim against
Landlord or to any abatement in rent, nor shall the same constitute constructive
or partial eviction, unless Landlord fails to take such measures as may be
reasonable in the circumstances to restore the service without undue delay. If
the Premises are rendered untenantable in whole or in part, for a period of over
three (3) business days, by the making of repairs, replacements or additions,
other than those made with Tenant's consent or caused by misuse or neglect by
Tenant or Tenant's agents, servants, visitors or licensees, there shall be a
proportionate abatement of rent during the period of such untenantability.
SECTION 32
Services
A. Landlord shall provide:
(i) Necessary elevator facilities and elevator repairs, including
emergency elevator repairs, on
17
Business Days from 8:00 a.m. to 7:00 p.m., on Saturdays from 9:00 a.m. to 1:00
p.m. and have at least one elevator subject to call at all other times; there
shall be no major loading or unloading in the Building between 9:00 a.m. and
6:00 p.m. on Business Days, except that Tenant shall schedule with the Building
manager Tenant's deliveries in the ordinary course of business at the Building
loading dock during such hours as may be reasonably designated by Landlord.
(ii) Light and heat for Building common areas.
(iii) Condensed water to the heat pump unities which provide heat
and air conditioning to the Premises and when the heat pump units alone cannot
provide in Landlord's reasonable judgment adequate heat for the Premises, or
when otherwise requested in advance by Tenant, supplemental hot water; such
supplemental hot water and condensed water to be available twenty-four (24)
hours per day, but at Tenant's cost (but not to exceed similar charges in
comparable office buildings) on non-Business Days other than Saturdays, on
Business Days from 7:01 p.m. to 7:59 a.m. and on Saturdays, for any periods
other than from 9:00 a.m. to 1:00 p.m., to provide heat or air conditioning to
the Premises.
(iv) Hot and cold water for ordinary lavatory and drinking
purposes, but if Tenant uses or consumes water for any other purposes or in
unusual quantities (of which fact Landlord shall be the reasonable judge),
Landlord may install a water meter at Tenant's expense which tenant shall
thereafter maintain at Tenant's expense in good working order and repair to
register such water consumption and Tenant shall pay for water consumed as shown
on such meter as Additional Rent within thirty (30) days following Landlord's
rendering the ▇▇▇▇ therefor. On Tenant's default in making such payment after
the expiration of applicable cure periods, Landlord may pay such charges and
collect the same from Tenant. A water meter shall be installed and maintained at
Tenant's expense if
18
required by Applicable Law. If a water meter is so installed, Tenant shall pay
its proportionate share of the water charges and sewer rent (if applicable)
resulting from such increased water use and all other rents and charges which
are now or hereafter assessed1 imposed, or may become a lien on the Premises or
the Building.
(v) Cleaning service for the Premises on Business Days at
Landlord's expense in accordance with the provisions of Exhibit C annexed hereto
and made a part hereof. Tenant shall pay Landlord the cost of removal of any
Tenant's "extraordinary refuse and rubbish" from the Building; as used herein,
extraordinary refuse and rubbish shall mean refuse and rubbish that necessitates
more than one (1) elevator load per floor of the Premises per day of refuse and
rubbish in excess of refuse and rubbish usually associated with normal office
use.
(vi) Parking facilities, in use common with the other tenants at
the Premises, their employees, agents and invitees, except that Tenant shall be
guaranteed availability of forty spaces including five reserved spaces to be
located adjacent to the handicapped parking area on the south side of the
Building.
(vii) Snow removal and landscaping services including the mowing
of lawn during the growing season at intervals at least one time per week.
(viii) Landlord agrees to repair 1 broken glass pane.
B. Landlord reserves the right to stop services of the elevators, the
heating, plumbing, air-conditioning, or power system, or cleaning or other
services, if any, when necessary by reason of accident or for repairs,
alterations, replacements, or improvements necessary in the reasonable judgment
of Landlord for as long as may be reasonably required by reason thereof or by
reason of strikes, accidents, laws, orders or regulations or any other reason
beyond the control of Landlord, provided that Landlord shall exercise good faith
efforts to diligently complete the repairs and restore the service as soon as
practicable and to minimize disruption to
19
Tenant's business.
SECTION 33
Electricity
(A) Tenant will obtain its electricity for the Premises as a direct
customer of the public utility through wiring, metering and equipment servicing
the Premises and either presently existing or hereafter installed by Tenant, as
hereinafter provided. If for any reason beyond Landlord's control, including
action by government or other authority asserting jurisdiction over the matter,
Tenant no longer can so obtain its electricity supplied directly from the public
utility, then, and in such event, Landlord will redistribute to Tenant the
electricity for the Premises area with charges to be determined pro-rata based
upon rentable area occupied by Tenant or at Landlord's option, on a "rent
inclusion", "submetering" or other basis.
(B) If and so long as electricity for all or part of the Premises is
to be obtained by Tenant directly from the public utility, Tenant shall obtain
from and pay to the public utility, for Tenant's entire separate supply of
electric current for the Premises and, or portion thereof receiving direct
service, by direct application to and arrangement with the public utility
company servicing the Building. Landlord will permit its electric feeders,
risers and wiring servicing the Premises to be used by Tenant to the extend
available and safely capable of being used for such purpose.
(C) Landlord shall not be liable to Tenant for any loss or damage or
expense which Tenant may sustain or incur if either the quantity or character of
electric service is changed or is no longer available or suitable for Tenant's
requirements.
SECTION 34
ACCEPTANCE OF POSSESSION AND PUNCH LIST ITEMS: Notwithstanding the
date specified in the Lease for the commencement of the term, the term and
Tenant's obligation to
20
pay rent under the Lease shall not commence until Landlord shall have
substantially completed all work and installations to be performed by Landlord
for Tenant's occupancy and Tenant has accepted possession of the Premises.
If Landlord is unable to give possession of the Premises on the
Commencement Date of the term of this Lease because construction, or
improvements are not completed, rent shall ▇▇▇▇▇ for the period that possession
by Tenant is delayed. If such delay shall continue for more than 45 days, than
Tenant may, within 10 days after the expiration of said 45 day period, give
Landlord a notice of election to terminate this Lease. Unless possession of the
Premises shall sooner be made available to Tenant, this Lease shall terminate on
the 10th day after the giving of said notice and Landlord shall return to Tenant
the consideration paid. Landlord shall have no obligation to Tenant for failure
to give possession except as above provided.
Tenant's acceptance of possession of the premises may be subject to a
punch list of incomplete or incorrect improvement items. Landlord shall complete
or correct the punch list items within thirty (30) days of submission of the
punch list by Tenant. Landlord agrees that, although rent will accrue from the
date of acceptance and taking of possession of the Premises by Tenant subject to
the rent concession provided for herein, no rent payments shall be made until
all punch list items are corrected to Tenant's satisfaction.
SECTION 35
QUIET ENJOYMENT: Landlord covenants that if and so long as Tenant pays
the rent and additional rent and performs the covenants hereof, Tenant shall
peaceably and quietly have, hold and enjoy the Premises for the term or renewal
term herein mentioned, subject to the provisions of this Lease.
SECTION 36
TIME LIMIT FOR COMPLETE EXECUTION: Landlord shall have five (5) days
from the delivery of this Lease signed by
Tenant in which to affix Landlord's signature to same and return a minimum of
one such fully executed document to Tenant. Failing to so perform shall entitle
Tenant to cancel this Lease by written notice to Landlord in which case this
Lease shall be deemed null and void, and neither party hereto shall have any
further obligation to the other for performance hereunder.
SECTION 37
INSURANCE: Tenant shall provide and at all times maintain
comprehensive liability insurance covering the Premises, written by an
underwriter satisfactory to Landlord, with minimum limits of liability,
regarding personal injury or death1 of $1,000,000.00 per occurrence, and
regarding property damage, of $100,000.00 per occurrence. Landlord shall be
named as an additional insured and shall be furnished with a certificate of
insurance. Landlord will be promptly notified of cancellation and/or reduction
in insurance coverage.
SECTION 38
EXPENSES OF PROCEEDINGS: In the event that Landlord shall have to
initiate any action or proceeding against the Tenant for the recovery of money
damages or possession of the Premises or other injunctive or declaratory relief
by reason of nonpayment of Rent or Additional Rent or by nonperformance by
Tenant of the terms and conditions of the lease then the Tenant shall pay, as
Additional Rent, all of Landlord's costs and expenses1 including reasonable
legal fees.
In the event that tenant shall have to initiate any action or
proceeding against the Landlord by reason of the Landlord's breach of any
obligation of Landlord under this Lease, and if Tenant is successful in such
action or proceeding, Landlord shall pay all of Tenant's costs and expenses,
including reasonable legal fees.
SECTION 39
BROKERAGE
Landlord and Tenant each represents and warrants to the other that it
has not dealt with any broker in connection
22
with this lease other than Ashland Properties ("Broker") and Landlord shall pay
Broker any commission earned pursuant to a separate Agreement between Landlord
and Broker. Landlord and Tenant shall indemnify and defend each other against
any costs, claims and expenses, including reasonable attorney's fees, arising
out of the breach of their respective parts of any representation Agreement
contained in this section.
SECTION 40
BLIND PROVISION: Tenant is hereby granted permission to install, at
Tenant's own expense and arrangement, interior window treatments which are
vertical in design and nature and colored either in light beige and/or cream.
SECTION 41
SECURITY: The sum of EIGHTEEN THOUSAND AND 00/100 ($18,000.00) DOLLARS
shall be deposited by the Tenant herein with the Landlord as security for the
faithful performance of all the covenants and conditions of the lease by said
Tenant. If the Tenant faithfully performs all the covenants and conditions on
its part to be performed, then such sum, shall be returned to said Tenant.
The Landlord shall deposit the security into a five year certificate
of deposit and the interest thereon shall accrue in favor of Tenant and be
payable to Tenant at the expiration of the Lease if Tenant performs all of the
covenants and conditions on its part to be performed.
SECTION 42
MISCELLANEOUS
A. LIMITATION ON LANDLORDS'S PERSONAL LIABILITY: It is understood and
agreed that Tenant shall look solely to the estate and property of Landlord in
the property for the satisfaction of Tenant's remedies for the collection of a
judgment (or other judicial process) requiring 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
23
the Lease to be observed or performed by the Landlord, and any other obligation
of Landlord created by or under this Lease, and no other property or assets of
Landlord or of its members, partners, beneficiaries, co-tenants, shareholders,
or principals (as the case may be) shall be subject to levy, execution or other
enforcement procedures for the satisfaction of Tenant's remedies.
The term "Landlord," as used throughout this Lease, shall be limited
to mean and include only the owner or owners at the time in question of
Landlord's interest in this Lease. Further, in the event of any transfer by
Landlord of Landlord's interest in this Lease, Landlord herein named (and in
case of any subsequent transfers or conveyances, the then owner), including each
of its members, partners, beneficiaries, co-tenants, shareholders, or principals
(as the case may be), shall be automatically freed and relieved, from and after
the date of such transfer or conveyance of any liability to Tenant by virtue of
this agreement.
B. FORCE MAJEURE: The period of time during which either party is
prevented or delayed in any performance or the making of any improvements or
repairs or fulfilling any obligation under his Lease, other than the payment of
Rent and Additional Rent, due to unavoidable delays caused by fire, catastrophe,
strikes or labor trouble, civil commotion, Acts of God, the public enemy,
governmental prohibitions or regulations or inability to obtain materials by
reason thereof, or any other causes beyond such party's reasonable control,
shall be added to such party's time for performance, and such party shall have
no liability by reason of such delay.
C. CHANGES AND ADDITIONS: Landlord hereby reserves the right at any
time, and from time to time, to make alterations or additions to, and to build
additional stories on the Building in which the Premises are located and to
build new space adjoining the same. Landlord also reserves the right at any
time, and from time to time, to construct other buildings
24
or improvements on Landlord's Property, to make alterations therein or additions
thereto, to build additional stories on any Building or Buildings within the
Landlord's Property, to build adjacent thereto, to construct decks or elevated
parking facilities, to install, maintain, use, repair and replace ducts, wires,
pipes and conduits passing through or under the Premises serving other parts
(now existing or hereafter added) of the Property, and to sell or lease any part
of Landlord's Property.
D. ATTORNMENT BY TENANT:
In the event any proceedings are brought for the foreclosure of,
or in the event of conveyance by deed in lieu of foreclosure of, or in the event
of the exercise of the power of sale under, any mortgage made by Landlord
covering the Premises, or in the event Landlord sells, conveys or otherwise
transfers its interest in the Property or any portion thereof containing the
Premises, Tenant shall attorn to and hereby covenants and agrees to execute an
instrument in writing reasonably satisfactory to the new owner whereby Tenant
attorns to such successor in interest and recognizes such successor as the
Landlord under this Lease.
E. SURVIVAL OF TENANT'S OBLIGATIONS: Any sums due Landlord from Tenant
that by the terms herein would be payable, or are incapable of calculation until
after the expiration or earlier termination of this Lease, shall survive and
remain a continuing obligation until paid.
F. EFFECT OF LANDLORD'S NOTICE TO TERMINATE: Any right on the part of
the Landlord to terminate this Lease shall, when exercised, require no further
act, to the end that at the expiration of the applicable time period, if any,
contained in the particular termination provision, this Lease and the term
hereunder shall end and expire as fully and completely as if such termination
date was that date herein definitely fixed for the end and expiration of this
Lease and the term hereof, and upon such date Tenant shall quit and
25
surrender the Premises to Landlord.
G. EFFECT OF CAPTIONS: The captions or legends in this Lease are
inserted only for convenient reference or identification of the particular
paragraphs. They are in no way intended to describe, interpret, define or
limit the scope, extent or interest of this Lease, or any paragraph or provision
thereof.
H. EXECUTION IN COUNTERPARTS: This Lease may be executed in one or
more counterparts, any one or all of which shall constitute but one agreement.
I. EXECUTION OF LEASE BY LANDLORD: The submission of this document for
examination and negotiation does not constitute an offer to lease or a
reservation of, or option for, the Premises, and this document shall be
effective and binding only upon the execution and delivery thereof by both
Landlord and Tenant.
J. ENVIRONMENTAL COMPLIANCE: Tenant represents that it shall not
release, discharge or deposit any Hazardous Substance as defined by any
environmentally related statute enacted by the State of New York. Should Tenant
breach the obligation not to release, discharge or deposit a Hazardous Substance
on the Premises, Tenant will unconditionally indemnify and hold Landlord
harmless from and on account of any claim, judgment, cleanup order or related
expense (including, but riot limited to, reasonable attorneys fees and
disbursements incurred in connection with defending or representing Landlord in
defending any action, judgment or clean-up order incurred in connection with any
release, discharge of deposit of any Hazardous Substance.
Tenant's obligation to Landlord as set forth in this sub-section
shall not extend to any claims not made to and received by Tenant within one
year from Tenant's (including
26
assignee's) vacating of the Premises.
LANDLORD:
▇▇▇▇▇▇ ENTERPRISES LLC
BY: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
Manager
TENANT:
ALLIED DIGITAL TECHNOLOGY CORP.
By: /s/ [ILLEGIBLE]
------------------------------------
Name:
Title: CEO
27
EXHIBIT "A"
The entire south side of the third floor of the Building located ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ Comprising 7,000 square rentable feet at the premises
described below:
ALL that certain plot, piece or parcel of land, situate, lying and
being in the Hamlet of Hauppauge, Town of Islip, County of Suffolk and
State of New York, being more particularly bounded and described as
follows:
BEGINNING at a point on the Westerly side of Fell Court, distant
425.00 feet, Southerly from the Southerly end of a curve connecting the
Westerly side of Fell Court, with the Southerly side of Rabro Drive
(extension);
RUNNING THENCE Southerly along the Westerly side of Fell Court, the
following three courses and distances:
1. South 2 degrees 35 minutes 3 seconds East, 177.55 feet;
2. 17.91 feet, on an arc of a right circular curve, the radius of
which is 20.00 feet;
3. 147.99 on the arc of a left circular curve the radius of which is
60 feet;
THENCE South 2 degrees 35 minutes 03 seconds East, 117.65 feet, to
land proposed to be dedicated to the Town of Islip;
THENCE South 88 degrees 07 minutes 22 seconds West, 290.02 feet, to
land now or formerly of ▇▇▇▇▇▇ ▇▇▇▇▇▇;
THENCE along land now or formerly of ▇▇▇▇▇▇ ▇▇▇▇▇▇, North 2 degrees 35
minutes 03 seconds West, 414.07 feet;
THENCE North 87 degrees 24 minutes 57 seconds East, a distance of 260
feet, to the Westerly side of Fell Court and the point or place of
BEGINNING.
EXHIBIT B
RENT SCHEDULE ATTACHED TO AND MADE PART OF A LEASE MADE BY AND ▇▇▇▇▇▇
ENTERPRISES LLC, LANDLORD and ALLIED DIGITAL TECHNOLOGY CORP. AS TENANT
BASE ANNUAL RENT
Annual Monthly
------ -------
November 1, 1996/
October 31, 1997 $101,500.00 $ 8,458.33
November 1, 1997/
October 31, 1998 $104,545.00 $ 8,712.08
November 1, 1998/
October 31, 1999 $107,681.35 $ 8,973.45
November 1, 1999/
October 31, 2000 $110,911.79 $ 9,242.65
November 1, 2000/
October 31, 2001 $114,239.14 $ 9,519.93
28
