XXXXXX XXXXXXXX and XXXXX XXXXXXXX, Landlords,
Lease Agreement
- with -
XXXXXX ELECTRONICS, Inc., Tenant.
000 Xxxx Xxxx Xxxxxx
Xxxxx Xxxxx, Xxx Xxxx 00000
Table of Contents
Article Subject Page
1. Definitions and Terms 2
2. Demising Clause 5
3. Term and Possession 5
4. Rent and Additional Rent 6
5. Prepaid Rent 9
6. Permitted Uses and Prohibited
Uses 10
7. Services Supplied by Lessor 12
8. Subletting and Assignment 13
9. Quiet Possession, Subordination
and Attornment 15
10. Landlord's Reserved Rights 17
11. Alterations and Improvements 18
12. Repairs and Replacements 21
13. Destruction or Damage 22
14. Eminent Domain 24
15. Holding Over 26
16. Surrender of Possession 26
17. Default and Remedies 28
18. Insurance and Waiver of Claims 31
19. Taxes on Lessee's Property and
Lease Taxes 34
20. Estoppel Certificates 35
20(A). Renewal Rights
21. Miscellaneous 37
22. Right of First Refusal 42
23. Post-Closing Obligations Under
Contract of Sale 44
Signature page 45
Acknowledgements 46
Article 1
Definitions and Terms
As used in this Lease, the following terms shall have the following
meanings:
1.1 Landlord or Lessor shall have the same meaning, and shall mean XXXXXX
XXXXXXXX and XXXXX XXXXXXXX, whose address is 00 Xxx Xxxxxxx, Xxxxxxx, Xxx Xxxx
00000, and their successors and assigns.
1.2 Tenant or Lessee shall have the same meaning, and shall mean XXXXXX
ELECTRONICS, Inc., a New York corporation having an office at 000 Xxxxx Xxxxxx,
Xxxxxxxxx, Xxx Xxxxxx 00000, and its permitted assigns.
1.3 Date of this Lease shall mean August 1, 1998.
1.4 Commencement Date or Commencement of the Term shall have the same
meaning, and shall mean August 1, 1998.
1.5 Expiration Date or Expiration of the Term shall have the same meaning,
and shall mean July 31, 2003.
1.6 Term or Term of this Lease shall have the same meaning, and shall mean
a period of five (5) years, beginning on the Commencement Date, and ending on
the Expiration Date, unless sooner terminated.
1.7 Rent Start Date shall mean October 1, 1998.
1.8 Building shall mean the land and building located at 000 Xxxx Xxxx
Xxxxxx, Xxxxx Xxxxx, Xxx Xxxx 00000.
1.9 Permitted Use shall mean the operation of a retail electronics,
accessories, audio equipment and video equipment sales, installation and service
business, and no other use whatsoever.
1.10. Annual Base Rent shall mean the sums set forth below for the
respective periods set forth below, as adjusted in accordance with the terms of
this Lease:
Period Annual Base Rent
10/1/98-7/31/99 $ 66,666.67
8/1/99-7/31/00 82,800.00
8/1/00-7/31/01 85,700.00
8/1/01-7/31/02 88,700.00
8/1/02-7/31/03 91,800.00
8/1/03-7/31/04 95,000.00
8/1/04-7131/05 98,300.00
8/1/05-7/31/06 101,700.00
8/1/06-7/31/07 105,300.00
8/1/07-7/31/08 109,000.00
1.11 Monthly Base Rent shall mean the Annual Base Rent divided by "12";
except that for the period 10/1/98-7/31/99, the Monthly Base Rent shall be $
6,666.67.
1.12 Rent shall mean the Annual Base Rent, plus all items of Additional
Rent required to be paid under this Lease.
1.13 Security Deposit shall be the sum of $ 6,666.67; and any additions to
such amount made during the Term.
1.14 Premises or Leased Premises shall have the same meaning, and shall
mean the premises described on Schedule "A".
1.15 Lessee's Proportionate Share shall mean 68.80%.
1.16 Real Estate Taxes shall mean ad valorem taxes imposed by any
municipality, government or bureau) department or division of any government,
and payable by Lessor, upon the land and improvements comprising the land and
Building, including assessments for public betterments, and sewer rents, water
frontage charges, vault taxes, and other similar impositions and assessments;
and any taxes imposed as a substitute, replacement or supplement to presently
imposed Real Estate Taxes. Real Estate Taxes shall not include income taxes
payable by Lessor.
1.17 Increased Real Estate Taxes shall mean the increase, if any, in Real
Estate Taxes over Real Estate Taxes in effect as of May 15, 1998.
1.18 Public Liability Insurance Limits shall mean $2,000,000. Combined
Single Limit.
1.19 Lease shall mean this Lease; the rights and obligations of the Lessor
and of the Lessee under this Lease, and of their respective successors; all
riders and amendments to this Lease; and all permitted modifications, extensions
and alterations to this Lease.
1.20 Lease Year shall mean a successive period of twelve calendar months,
commencing on the Commencement Date, or on the anniversary of the Commencement
Date.
Article 2
Demising Clause
2.1 Lessor, for and in consideration of the Lessee's payment of Rent, and
performance of the other terms and conditions of this Lease on the part of
Lessee to be performed, does hereby lease the Premises to Lessee; and Lessee
does hereby lease the Premises from Lessor, upon the terms and conditions set
forth in this Lease.
Article 3
Term and Possession
3.1 Term: The Term of this Lease shall begin on the Commencement Date, and
shall end on the Expiration Date, unless sooner terminated. Lessee shall be
entitled to possession of the Premises on the Commencement Date, subject to the
provisions of this Lease, and shall surrender possession of the Premises to
Lessor as of the close of business on the Expiration Date.
3.2 Occupancy Prior to Commencement Date: If Lessee, with the Lessor's
prior written consent, occupies the Premises, or any part of the Premises, prior
to the Commencement Date, then the Term shall also include the period from the
date of occupancy to the Commencement Date. In no event shall Lessee occupy the
Premises prior to the Commencement Date without the prior written consent of
Lessor.
3.3. Delays in Delivery of Possession: Lessor represents to the Lessee that
as of the Commencement Date, the prior tenant and occupant of the premises has
surrendered possession of the Premises, and its lease has been terminated; and
that the prior tenant and occupant has waived all of its rights of occupancy of
the Premises.
3.4 Acceptance of Occupancy: The Lessee accepts occupancy of the Premises
"as is", without any representation or warranty by the Lessor as to the physical
condition of the Premises. The Lessor represents that the Premises may lawfully
be used for a retail sales and service business, and that the applicable
Certificate of Occupancy for the Premises permits such use, and that no further
or amended Certificate of Occupancy is required in order for the Lessee to
conduct its business for the Permitted Use at the Premises. However, the Lessor
makes no further representations or warranties regarding the Premises; and the
Lessee accepts the Premises 13as is" and without representations or warranties
as to the condition thereof.
Article 4
Rent
4.1 Annual Base Rent: Lessee shall pay the Annual Base Rent to Lessor, at
such place or address as Lessor may from time to time designate by Notice, in
monthly installments, in advance, on or before the tenth (10th) day of each
month during the Term. Until further Notice, Lessee shall pay Rent at the
address set forth in Paragraph 1.1 of this Lease. Rent shall be paid without
demand, and without set-off or deduction whatsoever. Lessee shall pay Rent for
the first month of the Term on the Rent Start Date. Rent for any partial month
shall be prorated on the basis of thirty days to the month; and shall be paid on
the first day of any such partial period.
4.2 Adjustment to Annual Base Rent: [Intentionally deleted.]
4.3 Electricity: The Premises shall be separately metered for water,
electrical usage and gas (pursuant to the Workletter annexed to this Lease), and
Lessee shall pay for Lessee's electric, water and gas consumption directly to
the supplier of such utilities, and not to Lessor.
4.4 Real Estate Taxes: In addition to Annual Base Rent, Lessee shall pay to
Lessor, as Additional Rent, Lessee's Proportionate Share of Increased Real
Estate Taxes, prorated as may be appropriate for any partial fiscal tax year.
a) Real Estate Taxes shall include the amounts, if any, incurred by Lessor
as and for reasonable and necessary legal fees and other costs to contest the
amount of, or validity of, any Real Estate Taxes, in any calendar year;
inclusive of annual or other periodic payments to legal counsel to compensate
such legal counsel for counsel's efforts in maintaining or lowering Real Estate
Taxes, provided the fee for such legal services is contingent upon a tax
reduction, and/or such fee is payable out of tax savings.
b) Real Estate Taxes attributable to any calendar year shall be Real Estate
Taxes payable during such calendar year, notwithstanding that Real Estate Taxes
may have been assessed for a year other than the calendar year in which they are
payable.
c) As soon as reasonably feasible after Real Estate Taxes have been
determined, Lessor will furnish Lessee with a statement showing the then
currently applicable Real Estate Taxes, and Lessee's Proportionate Share of Real
Estate Taxes. Within thirty days after delivery of such statement, but in no
event prior to the due date for such tax, Lessee shall pay to Lessor the amount
so billed on such statement, as Additional Rent.
d) Lessor represents and warrants to Lessee that as of the Commencement
Date, there are no special assessments levied against the Building; and to the
knowledge, information and belief of Lessor, none are pending or threatened.
4.5 Administrative Charges, Late Fees, Attorneys' Fees: Installments of
Rent are due promptly, without demand, in advance on the first day of each
calendar month during the Term; or, if due within a period stated in this Lease
after the furnishing of a statement or Notice by Lessor, then within such period
of time. A per diem administrative charge of $25.00 shall be charged to Lessee
if Rent or Additional Rent is not received by Lessor, in full, on or before the
fifteenth (15th) day after the due date for such payment, but not in excess of
$275.00 in any calendar month. If Lessor is required to retain legal counsel to
enforce any of the rights and remedies granted to Lessor under this Lease,
Lessee shall reimburse Lessor, upon request, the reasonable and necessary fees,
costs and expenses of legal counsel so incurred by Lessor. The Administrative
Fee, Late Charge and obligation to reimburse legal fees, all as provided in this
Paragraph 4.6, shall survive the termination of this Lease, and shall all be
collectible by Lessor as Additional Rent.
4.6 Independent Covenants: Except as otherwise expressly set forth in this
lease, the Lessee's obligations under this Lease to pay Rent and Additional
Rent, and to perform the other obligations on the part of Lessee to be
performed, are independent and severable covenants from any obligations of the
Lessor under this Lease; and (except as otherwise expressly set forth in this
Lease) the Lessee shall not assert in any action or proceeding instituted by
Lessor against Lessee a counterclaim or claim for offset based upon the Lessor's
failure to perform any of the Lessor's obligations under this Lease.
Article 5
Prepaid Rent
5.1 Concurrently with the execution of this Lease by Lessee, Lessee has
deposited with Lessor the Security Deposit as Prepaid Rent, to be held by Lessor
to guarantee the full and timely performance by Lessee of its obligations under
this Lease, including (without limitation) the obligation to pay Rent and
Additional Rent. Lessor is not required to maintain the Prepaid Rent in a
segregated account, and may commingle the Prepaid Rent Deposit with other
receipts of Rent from the Building. The Prepaid Rent shall not bear or accrue
interest. If Lessee fails to perform any of the obligations on the part of
Lessee to be performed under this Lease, including (without limitation) the
obligation to pay each installment of Rent and Additional Rent when due, the
Lessor may, but shall not be required to, apply the whole or any part of the
Prepaid Rent to cure such default. If any portion, or all, of the Prepaid Rent
is so applied, Lessee shall, within five days after receipt of Notice itemizing
the amount and purpose(s) of such application, and demand therefor, deposit with
Lessor an amount sufficient to restore the Prepaid Rent to its original amount.
Failure to do so by Lessee shall be deemed a breach of this Lease. The
obligation of Lessee to do so shall be deemed an obligation on the part of
Lessee to pay Additional Rent, and may be so enforced by Lessor. If Lessee has
complied with all of the Lessee's obligations under this Lease, including
(without limitation) Lessee's obligations to pay all items of Rent and
Additional Rent, then the amount of the Prepaid Rent may be applied to the final
installments of Monthly Rent at the end of the Term of this Lease. Lessor may
decline to apply any portion, or all, of the Prepaid Rent until such time as all
amounts due from Lessee under this Lease have been paid in full, including
amounts which may become due by reason of lagging computations of Lessee's Share
of Operating Expenses and Real Estate Taxes. In the event of transfer of
ownership of the Building, Lessor may assign to or credit the new owner(s) with
the amount of the Prepaid Rent. Upon Notice from the new owner(s) to Lessee of
such assignment, transfer or credit, Lessee shall look solely to the new
owner(s) for application of of the Prepaid Rent; and the Lessor named in this
Lease shall be relieved of all liability with respect to the Prepaid Rent.
Article 6
Permitted Use, Compliance with Laws, Restricted Uses
6.1 Lessee shall use and occupy the Premises only for the Permitted Use,
and for no other use. Lessee and all persons permitted by Lessee to come upon
the Premises shall comply with all laws, ordinances, regulations and with any
rules and regulations promulgated by Lessor regarding the use of the Building
and of the Premises, including all laws, ordinances and regulations relating to
the installation or display of signs on the Building or in or about the
Premises. Any such rules and regulations shall apply to all occupants of the
Building on a non-discriminatory basis. Lessor shall have no liability to Lessee
for non-observance of any such rules and regulations by any other tenant or
occupant of the Building; nor for a breach by any other tenant or occupant of
the Building of any of the terms of such tenant's or occupant's lease. Lessee
shall not make or permit to be made any use of the Premises which is forbidden
by any applicable law, ordinance, statute or governmental regulation; nor use or
permit the use of any portion of the Premises for any activity which will
increase the existing rate of casualty and liability insurance on the Building,
~r on any part of the Building; nor shall Lessee sell, nor permit to be sold,
kept or used in or about the Premises, any substance or article which may be
prohibited or restricted under standard fire insurance policies. Lessee, at its
own expense, shall comply with all requirements pertaining to the operation of
its business on the premises, including requirements of any insurance
organization or company necessary for the maintenance of casualty and liability
insurance covering the Building and the Premises at standard premiums.
6.2. Certificate of Occupancy: As of the Commencement Date, the Lessor
represents and warrants to the Lessee that a valid, permanent Certificate of
Occupancy is in effect covering the Premises) authorizing the use of the
Premises for the Permitted Use; and that such Certificate of Occupancy has not
been revoked. As of the Commencement Date, the Lessor represents and warrants
that there are no building violations of record in the Department of Buildings
of the municipality in which the Premises are located. Except for work to be
done in and about the Premises by the Lessee (for which building permits and a
sign permit may be required prior to the commencement of any such work or the
installation of any signs), Lessor represents and warrants that no additional
permits or approvals by any municipal authority is required for the Lessee to
commence doing business in the Premises in accordance with the terms and
conditions of this Lease.
Article 7
Services
7.1 This Lease is a "net" Lease, and the Lessor shall not provide any
Services to the Lessee at the Premises except for those expressly set forth in
this Lease. The Lessee shall provide, at Lessee's sole cost and expense,
interior repairs, maintenance and cleaning of the Premises (including window
washing), as required. The Lessor will provide, at the Lessor's cost and
expense, maintenance, repair and replacement, as required, to the exterior
portions and structural elements of the Building (including roof, driveway and
rear parking area), and to the heating, air conditioning, electrical and
plumbing systems servicing the Premises, both within and outside the interior
demising walls of the Premises. As of the Commencement Date, the plumbing,
heating, electrical and cooling systems in the Building and in the Premises will
be in working order.
Article 8
Subletting and Assignment
8.1 Subletting and Assignment Prohibited: Lessee shall not assign,
mortgage, pledge or otherwise transfer (whether voluntarily, involuntarily by
operation of law, or otherwise) this Lease; nor shall Lessee sublet any portion
of the Premises; without the prior written consent of Lessor in each instance,
which consent shall not be unreasonably withheld. Any such assignment, mortgage,
pledge, encumbrance or other transfer, or any such subletting, without the
written consent of Lessor shall be absolutely void and of no effect whatsoever,
and shall constitute a breach of this Lease.
a) If Lessee desires to assign this Lease, or to sublet any portion of the
Premises, Lessee shall furnish Lessor with a Notice specifying:
i) The name and address of the proposed assignee or subtenant; and such
other information as Lessor may reasonably request regarding the proposed
assignee's or subtenant's financial responsibility and standing; and
ii) the terms and conditions of the proposed assignment or subletting.
b) Lessor shall not in any event be obligated to consent to any such
proposed assignment or subletting unless:
i) the proposed assignee or subtenant is of a financial standing reasonably
satisfactory to Lessor;
ii) the proposed assignee or subtenant, or the proposed use of the premises
by the proposed assignee or subtenant, is not in conflict with or does not
violate the applicable building and zoning codes, and is consistent with the
permitted uses under the Certificate of Occupancy then in effect for the
Building;
iii) any obligation of the proposed subtenant or assignee to pay to the
Lessee any consideration for the purchase of the Lessee's business, or for the
purchase of the leasehold, or to otherwise make periodic installments to or for
the benefit of the Lessee, shall be subordinated to the proposed subtenant's or
assignee's obligation to pay Rent under this Lease;
iv) Lessee shall have then fully complied with all of the terms and
conditions of this Lease on the part of Lessee to be performed; and shall have
been in full compliance with such terms and conditions as of the effective date
of the proposed assignment or sublease;
v) Lessee shall reimburse Lessor for all reasonable costs and expenses that
may be incurred by Lessor in connection with the proposed assignment or
subletting, including (without limitation) the reasonable costs of making
investigations as to the acceptability of a proposed assignee or subtenant, and
the reasonable legal expenses incurred in connection with the granting of any
requested consent to the assignment or sublease;
c) Any subletting pursuant to this Lease shall be subject to all of the
terms and conditions of this Lease. Notwithstanding any such assignment or
subletting, and the acceptance of Rent and Additional Rent by the Lessor from
any such assignee or sublessee, Lessee shall remain fully liable for the payment
of all Rent and Additional Rent provided in this Lease, and for the performance
of all of the obligations of the Lessee contained in this Lease.
d) Lessor shall be furnished with a duplicate original counterpart of any
instrument of assignment or sublease made by Lessee with respect to the
Premises, bearing the original signatures of the parties to be bound thereunder.
Article 9
Quiet Possession, Subordination, Attornment
9.1 Provided Lessee has fully performed all of the terms and conditions of
this Lease on the part of Lessee to be performed, Lessee shall peaceably and
quietly enjoy the use and occupation of the Premises throughout the Term,
without hindrance or molestation by anyone claiming through or under Lessor;
subject, however, to the terms and conditions of this Lease.
9.2 This Lease, and the rights of Lessee under this Lease, is subject and
subordinate:
a) to all present and future financial encumbrances on the Building, or on
any portion of the Building, including (without limitation) all mortgages, deeds
of trust, or trust deeds in the nature of mortgages, and other similar
encumbrances;
b) to all present or future ground leases of the land underlying the
Building;
c) to all modifications, extensions and replacements thereof;
d) to all such instruments which may affect the Building and adjacent
property;
e) to any spreaders or consolidations of any such financial instruments.
9.3 In confirmation of such subordination, Lessee shall promptly upon
request execute and deliver to Lessor any instrument which the Lessor, or the
holder of any such financial encumbrance, or the lessor of any ground lease to
which this Lease is subordinate, may reasonably request to evidence such
subordination. If Lessee shall fail to so execute and deliver such instrument,
Lessor is hereby irrevocably authorized to execute and to deliver such
instrument in the name of Lessee as Lessee's agent for such limited purpose.
9.3.1 Disturbance Agreement. The Lessor shall use the Lessor's best efforts
to obtain from the holder of any mortgage placed as a lien upon the Building an
agreement providing, in effect, that such holder will recognize this Lease and
Lessee's rights under this Lease, and will not disturb Lessee's tenancy under
this Lease for so long as Lessee complies with all of the obligations under this
Lease on the part of Lessee to be performed, notwithstanding any breach under
the terms of such mortgage, or in the event of a foreclosure of such mortgage.
This Lease, and Lessee's rights and obligations under this Lease shall remain
unaffected if, after using the Lessor's best efforts to obtain such an agreement
from such mortgage holder, such an agreement can not ~e obtained (or if such
mortgage holder refuses to consent to any such agreement)
9.4 If the holder of any financial encumbrance or the lessor of any ground
lease affecting the Building shall succeed to the rights of Lessor under this
Lease, whether through possession or foreclosure action, or delivery of a new
lease or deed, then at the request of such party so succeeding to Lessor's
rights (referred to as "Successor Landlord") and upon such Successor Landlord's
written agreement to accept Lessee's attornment, Lessee shall attorn to and
recognize such Successor Landlord as Lessee's landlord under this Lease, and
shall promptly execute and deliver any instrument which such Successor Landlord
may reasonably request to evidence such attornment, provided such Successor
Landlord shall consent, as a condition of such attornment, that the Lessee's
rights under this Lease shall not be disturbed, terminated nor otherwise
adversely affected as a result of such attornment for so long as Lessee performs
all of the terms, covenants and conditions of this Lease on the part of the
Lessee to be performed. 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 Lessee upon all of the terms and conditions set forth in this
Lease; except that the Successor Landlord shall not:
a) be liable for any previous act or omission of Lessor under this Lease;
b) be subject to any offset, not expressly provided for in this Lease,
which shall have theretofore accrued to Lessee against Lessor;
c) be bound by any previous modification of this Lease, not expressly
provided for in this Lease or otherwise reduced to a written instrument signed
by the parties; nor by any previous prepayment of more than one month's Rent,
unless such modification or prepayment shall have been expressly approved in
writing by the Successor Landlord.
Article 10
Lessor's Reserved Rights
10.1 Lessor reserves the following rights:
a) to display "for rent" signs in and about the Premises during the last
four months of the Term;
b) during the last twelve months of the Term, to show the Premises to
prospective tenants;
c) to inspect the Premises, upon reasonable prior notice to Lessee and
(except for emergencies) at reasonable times; and to enter the Premises, without
prior notice, in the event of an emergency;
Article 11
Alterations and Improvements
11.1 Condition of Premises: Other than as provided in this Lease, Lessor
has not made any representations as to the condition of the Premises or of the
Building.
11.2 Delays in Completion of Alterations: [Intentionally deleted.]
11.3 Changes After Commencement Date: Lessee shall not, without the prior
written consent of Lessor in each instance (which consent shall not unreasonably
be withheld), make any material or structural alterations, improvements or
additions to the Premises (referred to as a "Change"). If Lessor consents to a
Change, Lessor may impose such conditions with respect to such consent that are
reasonably necessary or appropriate with respect to such proposed Change
(including, without limitation, the condition that additional insurance be
obtained by Lessee) as Lessor deems appropriate.
a) The work necessary to make the Change shall be done at Lessee's sole
cost and expense by employees or contractors approved by Lessor. Lessee shall
pay promptly, when due, the cost of all such work, which shall be done in a
workmanlike manner, and consistent with Building standards.
b) Upon completion of such work, Lessee shall deliver to Lessor waivers of
all liens for labor, services and materials relating to the work in a form
satisfactory to Lessor. If the performance of such work gives rise to a lien,
then Lessor may (but shall not be required to) pay and satisfy such lien; and
the amount so expended by Lessor shall be reimbursed by Lessee to Lessor
promptly, upon request, as Additional Rent.
c) Lessee shall defend and hold Lessor and the Building harmless from all
costs, damages, liens and expenses related to the work. Lessee shall not be
deemed to be the agent of Lessor in connection with the work, nor in connection
with any other matter arising out of this Lease.
d) In the performance of the work, Lessee shall ensure that all
requirements of insurance carriers are complied with.
e) Upon the expiration of the Term, any Change shall become the property ~f
the Lessor; and, unless Lessor requests otherwise, shall be relinquished to the
Lessor in good condition, ordinary wear and tear from normal use excepted. At
the election of the Lessee, the Lessee at its sole cost and expense may remove
its personal property and trade fixtures which constitute the Change, and
restore the area from which such property has been removed to the condition
which existed immediately prior to the Change, ordinary wear and tear from
normal use excepted. As a condition to the Lessor's consent to any Change,
Lessor may require that the Premises be restored upon the expiration of the
Term, at the expense of Lessee, to the condition which existed immediately prior
to the Change.
Article 12
Repairs and Replacements
12.1 Lessee's Obligation to Repair; Lessee's Obligation to Maintain:
Subject to the rights and obligations set forth in Article 7 of this Lease, at
its expense, Lessor will maintain and keep the exterior and structural portions
of the Building, all utility service lines, pipes and plumbing servicing the
Premises, and all public areas of the Building, in good condition. Lessee, at
its expense, shall keep the Premises in a safe and tenantable condition, and in
good order, repair and appearance. If Lessee fails to do so, Lessor may (but
shall not be required to) restore the Premises to a safe and tenantable
condition; and Lessee shall pay the cost thereof, upon request, as Additional
Rent.
Article 13
Destruction or Damage
13.1 Destruction or Damage: Restoration: If the Building or the Premises
are partially or totally damaged or destroyed by fire or other casualty, whether
or not the damage or destruction shall have resulted from the fault or neglect
of Lessee or its employees, agents, visitors or guests, and if this Lease shall
not have been terminated as provided in this Article 13, Lessor shall repair the
damage and restore and rebuild the Building and/or the Premises, out of and to
the extent of the proceeds of any policy of casualty insurance payable to
Lessor, with reasonable dispatch after receipt of such proceeds. In no event,
however, shall Lessor be required to repair or to replace any of Lessee's
property; nor shall Lessee be relieved of liability or responsibility for damage
or destruction resulting from the fault or neglect of Lessee (or of its
employees, agents, visitors or guests) if the insurance policies carried by
Lessee under this Lease do not contain a waiver of the right of subrogation.
13.2 Partial Damage: Abatement of Rent: If the Building or the Premises are
partially damaged or partially destroyed by fire or other casualty, Rent shall
be abated to the extent that:
a) the Premises shall have been rendered untenantable, and for the period
from the date of such damage or destruction to the date that the damage or
destruction shall have been substantially repaired or restored; and
b) the Lessor shall have received compensation, in lieu of Rent, from any
rent interruption or business interruption insurance carrier.
13.3 Total Damage or Destruction, Termination of Lease: If the Building or
the Premises shall be totally damaged or destroyed by fire or other casualty, or
if the Building shall be so damaged or destroyed by fire or other casualty as to
require a reasonably estimated expenditure of more than 50% of the full
insurable value of the Building immediately prior to the casualty in order to
restore the same, then in either such case, Lessor may terminate this Lease by
giving Lessee Notice to such effect within 30 days after the date of the
casualty. In case of any damage or destruction mentioned in this Paragraph.
13.3 Lessee may terminate this Lease upon Notice to Lessor, if Lessor has
not substantially completed the making of the required repairs, and
substantially restored and rebuilt the Building and the Premises within ninety
(90) days from the date of the casualty, or within such period after such date
(not exceeding an additional thirty (30) days) as shall equal the aggregate
period Lessor may have been delayed in doing so by adjustment of insurance,
labor troubles, governmental controls, or other causes reasonably beyond the
control of Lessor; and such termination shall be effective upon the expiration
of thirty days after the date of such Notice.
13.4 No Claim for Consequential Damages: No damages, compensation or claim
shall be payable by Lessor for inconvenience, loss of business or annoyance
arising from any repair or restoration of any portion of the Premises or of the
Building, unless such claims are covered by Lesssor's casualty insurance
coverage.
Article 14
Eminent Domain
14.1 Whole or Partial Taking: If the whole of the Premises shall be
lawfully condemned or taken in any manner for any public or quasi-public use,
this Lease and the term and estate hereby granted shall forthwith cease and
terminate as of the date of vesting of title. If only a part of the Premises
shall be so condemned or taken, then, effective as of the date of vesting of
title, the Rent shall xxxxx in proportion to the area so taken, and Lessee's
Proportionate Share shall be similarly proportionately reduced. However, if such
partial taking shall materially and adversely affect the conduct of Lessee's
business at the Premises, then the Lessee may, upon not less than thirty (30)
days' Notice, terminate this Lease.
14.2 Partial Taking, Election to Terminate: If only a part of the Building
shall be so condemned or taken, then Lessor (whether or not the Premises be
affected) may, at Lessor's option, if a material portion of the Building is so
taken (such option to be elected, if at all, in a commercially reasonable
manner):
a) terminate this Lease, and the term and estate hereby granted shall cease
and terminate as of the date of such vesting of title, upon Notice to Lessee
given within sixty days following the date upon which Lessor shall have received
notice of vesting of title; or
b) if such condemnation or taking shall be of a substantial part of the
Premises, or of a substantial part of the means of access thereto, so that, as a
result of such taking, reasonable access to the Building is no longer available
Lessee may, at Lessee's election, by Notice to Lessor delivered within thirty
days following the date on which Lessee shall have received notice of vesting of
title, terminate this Lease, and the term and estate hereby granted shall cease
and terminate as of the date of such vesting of title; or
c) if neither Lessor nor Lessee shall elect to terminate this Lease in the
manner set forth in this Paragraph 14.2, this Lease shall be and remain
unaffected by such condemnation or taking, except that the rent shall be abated
to the extent provided in this Article 14.
d) If only a part of the Premises shall be so condemned or taken, and this
Lease with respect to the part not taken is not terminated as provided in this
Article 14, Lessor shall, with reasonable dispatch, and out of the condemnation
award, restore the remaining portion of the Premises as nearly as practicable to
the same condition as existed prior to the condemnation or taking.
e) The entire condemnation award derived from any such condemnation or
taking shall belong to the Lessor, and no portion of such award shall belong to
Lessee, regardless of the manner in which such award shall have been computed or
allocated; unless the condemning authority shall have made an award separate
from the Lessor's award, and payable t6 the Lessee in compensation for the
taking of Lessee's interest in the leasehold.
Article 15
Holding Over
15.1 Effect of Holding Over After Expiration of Term: If Lessee retains
possession of the Premises, or any part of the Premises, after the expiration of
the Term, or after any extension of the Term, whether the Term ends on the
Expiration Date or at any other time, Lessee shall pay to Lessor for the use and
occupation of the Premises (or of the part of the Premises so occupied) at the
rate of 200% of the rate payable for the month immediately prior to the holding
over, computed on a per month basis, for each month or part of a month (without
reduction for partial month) that Lessee remains in possession. Such payment
shall not be construed as the creation of a new lease between Lessor and Lessee,
nor as a renewal or extension of this Lease; but shall be deemed liquidated
damages to Lessor for Lessee's holding over after the expiration of the term;
and shall in no way impair the Lessor's right to seek possession of the Premises
by legal proceedings.
Article 16
Surrender of Possession
16.1 At the Expiration Date or other termination of the Term, Lessee shall
immediately surrender the Premises to Lessor in good repair and condition,
ordinary wear and tear from normal use excepted; and further excepting damage
from fire or other casualty for which Lessee is not liable. Lessee shall at its
expense remove its furniture and equipment from the Premises, and shall repair
all damage to the Premises or to the Building occasioned by such removal; or pay
to Lessor the cost of such repair if Lessee fails to make such repairs promptly
upon removal. Lessee shall leave the Premises in "broom clean" condition. Any
personal property which Lessee does not remove from the Premises shall be deemed
abandoned by Lessee; and Lessee shall be deemed to have conveyed the same to
Lessor. Lessor may dispose of the same without incurring any obligation to the
Lessee to account for such property; and Lessee hereby waives any and all claims
against Lessor for damages or for other compensation with respect to such
property. If Lessor incurs any expense to dispose of such abandoned property,
Lessee shall reimburse Lessor for the expenses so incurred, upon request, as
Additional Rent.
Article 17
Default and Remedies
17.1 Acts of Default: The following shall be deemed a default by Lessee of
its obligations under this Lease:
a) failure to pay any installment of Rent or Additional Rent within fifteen
(15) days of the due date for each installment of Rent;
b) failure to observe or to perform any obligation on the part of Lessee to
be performed under this Lease, other than the payment of Rent or Additional
Rent, and such failure shall persist for fifteen days after delivery of Notice
to cure;
c) failure to remove or to cure a hazardous condition immediately upon
Notice to cure or to remove the same;
d) the levy or execution upon the interest of Lessee under this Lease or in
the Premises;
e) abandonment of the Premises;
f) the filing by or against Lessee of a petition in bankruptcy; and such
petition not having been dismissed within thirty days of its filing;
g) the institution of any proceeding by or against the Lessee whereby the
Lessee seeks relief from creditors; or in which Lessee seeks to make a general
assignment for the benefit of creditors; or seeks a composition with its
creditors; or in the event of an appointment of a receiver of Lessee; and such
proceeding or appointment shall not have been vacated or dismissed within thirty
days of the date of filing or appointment; or then, in any one or more such
events, Lessor may treat the occurrence as a breach of this Lease, provided
that:
x) if such default is a monetary default, then Lessee shall upon five days
Notice to cure, fully cure the same; and
y) if such default is other than a monetary default, then Lessee shall upon
ten days Notice to cure, fully cure the same, or within such period of time take
all reasonable a necessary steps to cure the same and diligently pursue the cure
of such default as expeditiously as reasonably possible; and
z) in either event, if Lessee shall have complied with the provisions of
"x" or "y" (whichever is applicable) , Lessee shall not be deemed in default of
its obligations under this Lease; otherwise, Lessee shall be deemed to be in
default of its obligations under this Lease, and the Lessor may, without further
notice or demand of any kind to Lessee, or to any other person, exercise any one
or more of the following remedies in the manner provided by law. In no event,
however, shall Lessor be required to furnish Lessee with Notice of a monetary
default more than two times in any calendar year.
i) Lessor may (after the expiration of any applicable grace period or
period to cure) terminate this Lease, in which event Lessor may immediately take
possession of the Premises and prepare the same for reletting, and to relet the
same, in a commercially reasonable manner and on commercially reasonable terms,
to any other lessee of Lessor's choosing. Lessor shall use its best efforts to
re-let the Premises in a commercially reasonable manner. The costs and expenses
of preparing the Premises for reletting (including, without limitation,
reasonable brokers' commissions, advertising expenses and fix-up expenses) shall
remain the liability of the Lessee. In the event the Premises are relet to
another Lessee at a rent less than the amount of Rent and Additional Rent
reserved in this Lease, then the Lessee shall remain liable to the Lessor for
the difference between the Rent and Additional Rent the Lessor would have
received, had the Lessee complied with its obligations to the Lessor under this
Lease, and the rent (inclusive of any "additional rent") which the Lessor
actually receives from such other lessee.
ii) Lessor may terminate Lessee 5 right to possession, and may repossess
the Premises by forceable entry, summary proceeding, or by any other lawful
process, by taking peaceful possession or otherwise without terminating this
Lease, in which event Lessor may, but shall be under no obligation to, relet the
Premises for the account of Lessee, for such rent and upon such terms as may be
commercially reasonable. For the purpose of such reletting, Lessor is authorized
to decorate, repair, remodel or alter the Premises. If Lessor shall fail to
relet the Premises, Lessee shall pay to Lessor the Rent and Additional Rent
reserved in this Lease for the balance of the Term. If the Premises are relet,
and a sufficient sum shall not be realized from such reletting after payment of
the costs and expenses of all decoration, repairs, remodeling, alterations,
brokers, and legal counsel thereby incurred, to satisfy the Rent and Additional
Rent provided in this Lease, Lessee shall pay the same upon request. No suit or
recovery of any portion due Lessor shall be any defense to any subsequent suit,
action or proceeding brought for any other amount not previously reduced to
judgment in favor of Lessor.
l7.1.1 Waiver of Landlord's Lien. Notwithstanding any provision of this
Lease to the contrary, the Lessor does hereby waive any claim to a lien with
respect to the Lessee's inventory which may now or hereafter be placed in or
about the Premises, whether such claim may arise as a result of the Lessee's
uncured default(s) under this Lease, or otherwise. The Lessor consents that the
Lessee's inventory may be encumbered with a lien, security interest or other
encumbrance in favor of any lender or secured party; and further consents that
any such lien, security interest or other encumbrance with respect to such
inventory shall be prior in right, and senior to, any claim of Lessor under this
Lease. Lessor shall, at Lessee's request, execute and deliver an appropriate
lien waiver required by any secured lender of the Lessee, which lien waiver
shall reflect the provisions of this Lease.
17.2 No Waiver by Implication: No waiver of any default of Lessee shall be
implied from any omission by Lessor to take any action on account of a default
if such default persists or shall be repeated; and no express waiver shall
affect any default other than the default specified in the express waiver, and
only then for the time and to the extent therein stated. No failure on the part
of Lessor to exercise any right or remedy granted under this Lease, or the
failure of Lessor to insist upon strict compliance with the terms of this Lease,
shall be construed as a waiver of the Lessor's right to exercise such right or
remedy, or to demand strict compliance. No course of conduct, nor any custom or
practice of the parties shall be construed as a waiver or modification of any of
the provisions of this Lease.
Article 18
Insurance and Waiver of Recovery
18.1 Compliance with Insurance Requirements: Lessee shall not violate, or
permit the violation of, any condition imposed by the standard fire insurance
policy then issued for buildings comparable to the Building; and shall not do,
or permit anything to be done, or keep or permit anything to be kept in the
Premises which would subject Lessor to any liability or responsibility for
personal injury or death or property damage, or which would increase the fire or
other casualty insurance rates on the Building over the rate which would
18.4 If, by reason of the failure of Lessee to comply with the terms of
this Lease, the rate of fire or other casualty insurance on the Building or on
any of Lessor's property in the Building shall be higher than it otherwise would
be, Lessee shall reimburse Lessor upon request, for that part of the excess
premiums for such insurance coverages.
18.5 Insurance Coverage Limits: Lessee shall provide on or before the
Commencement Date, and shall maintain in full force and effect during the Term
of this Lease, for the benefit of Lessor and of Lessee:
a) a general liability insurance policy protecting the Lessor and the
Lessee against any liability whatsoever, occasioned by any occurrence on or
about the Premises or any appurtenances thereto, in the amount of the Public
Liability Insurance Limits.
b) a casualty insurance policy protecting the Lessor and Lessee, and
providing for coverage against loss or damage to Lessee's improvements and trade
fixtures for not less than the full replacement value thereof (provided,
however, that Lessor shall maintain casualty insurance on the Building and
Premises, excluding Lessee's improvements and trade fixtures).
c) business interruption or rent interruption insurance coverage providing
for the payment to the Lessor, in the event of a covered loss, installments on a
monthly basis of not less than the then-current Annual Rent provided for in this
Lease (such installments, if any so paid to Lessor, shall be credited against,
and offset from, the Rent otherwise payable by Lessee under this Lease).
Such policy or policies shall be written by a reputable and solvent
insurance company satisfactory to Lessor, and authorized to conduct business in
the State of New York. Such policy may be carried under a blanket policy
covering the Premises and other locations of Lessee, if any. Such policy shall
provide that not less than ten (10) days prior to its termination or
cancellation, whether for non-payment of premiums or for any other reason,
Lessor shall be notified in writing of such termination or cancellation.
Lessee's failure to provide and to keep in full force and effect such insurance
coverage shall be deemed to be a material default under this Lease entitling
Lessor to exercise any or all of the remedies provided in this Lease in the
event of default.
18.6 Limitation of Lessor's Liability: Except as otherwise expressly set
forth in this Lease to the contrary, the Lessor's obligations and covenants
under this Lease may be enforced and satisfied solely out of Lessor's interest
in the Building; and under no circumstances shall any claim or demand be
asserted against, nor enforced or collected from, any personal assets of the
individual comprising the Lessor, other than his interest in the Building; and
all claims and demands which may be asserted against any member, partner,
stockholder, manager, officer or director of Lessor, in their personal capacity,
is hereby waived.
Article 19
Taxes on Lessee's Property and Lease Taxes
19.1 Taxes on Lessee's Property: Lessee shall be solely liable for, and
shall pay before delinquency, all taxes levied against any personal property or
trade fixtures placed by Lessee in the Premises. If any such taxes on Lessee's
personal property or trade fixtures are levied against the Lessor or against
Lessor's property, or if the assessed value of the Building is increased by the
inclusion therein of a value placed upon such personal property or trade
fixtures of Lessee, and if Lessor, after Notice to Lessee, pays such taxes based
upon such increased assessments (which Lessor shall have the right but not the
obligation to do, regardless of the validity thereof, but only under proper
protest if request by Lessee), Lessee shall upon request repay to Lessor the
taxes so levied against and paid by Lessor, or the proportion of such taxes
resulting from such increase in the assessment; provided that in any such event,
at Lessee's sole cost and expense, Lessee shall have the right, in the name of
the Lessor and with Lessor's cooperation, to bring suit in any court of
competent jurisdiction to recover the amount of any such taxes so paid under
protest, and any amounts so recovered shall belong to Lessee.
19.2 Lease Taxes: If any government or governmental agency or department
levies a tax measured by or based, in whole or in part, upon the value or amount
of rent, which tax is payable pursuant to the relevant law, ordinance or state
by Lessee (either directly by Lessee or indirectly by Lessor as collector for
the taxing authority), then Lessee shall pay the tax in accordance with any such
ordinance or statute, or shall reimburse Lessor therefor. This Paragraph shall
not be construed so as to apply to Federal, State and municipal income taxes
payable by Lessor upon its gross income.
Article 20
Estoppel Certificate
20.1 Execution and Delivery of Estoppel Certificates: Lessee shall, within
ten days after written request from Lessor, execute and deliver to Lessor or to
a person designated by Lessor a certificate in form satisfactory to Lessor
stating: a) that this lease is unmodified and in full force and effect (or, if
there has been a modification, that the same is in full force and effect as so
modified, and stating the nature of the modification); b) certifying the dates
to which Rent and Additional Rent have been paid; c) stating the amount of the
Prepaid Rent; and d) stating whether or not, to the best knowledge of the
Lessee, the Lessor has complied with the terms and conditions of this Lease on
the part of Lessor to be performed (or, if such is not the case, stating in what
particular Lessor has not so complied). It is mutually acknowledged that any
such certificate delivered pursuant to this Article 20 may be relied upon by
others with whom the Lessor may be dealing. If Lessee shall fail to so execute
and deliver such certificate within the time required by this Article 20, then
Lessee does hereby irrevocably appoint Lessor as the agent and attorney-in-fact
of the Lessee, for the limited purpose of executing and delivery such
certificate in the name of Lessee and on Lessee's behalf.
Article 20(A)
Renewal Rights
20(A).1 Renewal Rights: Provided the Lessee, at the time of the exercise by
the Lessee of any option to renew, has then fully complied with all of the
obligations in this Lease on the part of the Lessee to perform (including,
without limitation, the obligation to pay Rent and Additional Rent when due),
and is not in default of its obligations under this Lease, then Lessee may renew
this Lease for an additional term ("the Renewal Term") of five (5) years, to
commence on the fifth (5th) anniversary of the Commencement Date, and to expire
on the fifth (5th) anniversary of the Expiration Date, as follows:
(a) Not later than 120 days prior to the Expiration Date, Lessee shall
serve Lessor with Notice to the effect that Lessee elects to renew the term of
this Lease for the Renewal Term. Timely service of such Notice is of the essence
to the Lessee's exercise of the renewal rights granted hereunder.
(b) Upon the service of such Notice, this Lease shall be deemed renewed for
the Renewal Term, upon the same terms and conditions set forth in this Lease;
except that nothing in this Lease shall be construed as a right further to renew
the term of this Lease upon the expiration of the Renewal Term.
(c) The failure of the Lessee to serve the Notice described in this Article
in a timely manner shall be deemed an election by the Lessee not to renew the
term of this Lease for the Renewal Term; and this Lease shall thereupon expire
on the Expiration Date (unless sooner terminated).
(d) The Rent payable during the Renewal Term (if exercised) shall be as set
forth in Article 1 of this Lease.
Article 21
Miscellaneous Provisions
21.1 Legal Fees: (a) Lessee shall pay upon request all of Lessor's costs
and expenses, including the reasonable fees and disbursements of legal counsel,
incurred in enforcing Lessee's obligations under this Lease. The obligation of
Lessee under this Paragraph 21.1 shall be deemed Additional Rent.
(b) If, in any action or proceeding, it shall be adjudged that Lessor has
failed to perform any of its obligations under this Lease toward Lessee, as a
result of any claim or counterclaim brought by Lessee against Lessor, then
Lessor shall pay to Lessee the reasonable fees and disbursements of legal
counsel so incurred by Lessee.
21.2 Notices: All Notices under this Lease shall be in writing, and shall
be delivered via Certified Mail, Return Receipt Requested, or via Federal
Express, Express Mail, or via any other reputable overnight delivery service
which provides written evidence of delivery; and such Notice shall be deemed
delivered upon receipt by the addressee, or refusal by the addressee. Such
Notice shall be addressed to the party to whom such notice is directed at the
address shown in Article 1, or at such other or additional addresses as either
party may designate by Notice.
21.3 Lessor's Right to Transfer or Assign Interest in Lease: Except as
otherwise expressly set forth in this Lease to the contrary, without the prior
consent of Lessee, and without prior Notice to Lessee, Lessor may transfer its
interest in the Building and/or in this Lease subject to the terms and
conditions of this Lease; and, after Notice of such transfer to Lessee, and the
assumption of the Lessor's obligations under this Lease by the transferee,
Lessor shall be released from all liability under this Lease, except as to prior
acts of default (if any) by Lessor, and Lessee shall look solely to such
transferee for the performance of Lessor's obligations hereunder. Lessor may
assign its interest in this Lease to any lender as collateral security for any
loan; but such a collateral assignment shall not release Lessor from its
obligations under this Lease; and Lessee shall look solely to Lessor, and not to
any such lender, for the performance of Lessor's obligations under this Lease.
21.4 Applicable Law; Unenforceable Provisions: This Lease shall be governed
in all respects by the laws of the State of New York. If any provision of this
Lease, or the application thereof to any person or under any circumstances,
shall to any extent be invalid or unenforceable, the remainder of this Lease, or
the application of the offending provisions to persons or under circumstances
other than those as to whom or which it is held 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.
21.5 Entire Agreement; No Other Representations: This Lease, and the
Exhibits annexed to this Lease, represents the entire agreement between Lessor
and Lessee. There are no verbal representations, warranties, promises or
statements, except to the extent that the same are expressly set forth in this
Lease, or in any other written agreement which may be made between the parties
concurrently with the execution and delivery of this Lease, upon which either
has relied in entering this Lease. This Lease may not be modified by any verbal
agreement, course of conduct, practice or custom; but only by a written
instrument signed by the party to be bound thereby.
21.6 Ejustem Generis: The rule of ejustem generis shall not be applicable
to limit any general statement set forth in this Lease which general statement
is followed by or refers to an enumeration of specific matters, to matters
similar to the matters specifically mentioned.
21.7 Brokers: If a Broker is named in Article 1, then Lessee represents and
warrants to Lessor that Lessee has not dealt with any real estate agent or
broker other than the Broker in connection with this Lease, or in connection
with Lessee's introduction to the Premises or to the Building. If any broker
(other than the Broker, if one is named in Article 1) claims that it was
instrumental in introducing the Building or the Premises to the attention of
Lessee; or was the procuring cause of this Lease; or was otherwise entitled to a
commission as a result of this Lease, then Lessee shall indemnify Lessor against
and hold Lessor harmless from any such claim, including the reasonable and
necessary costs and expenses of legal counsel incurred by Lessor in defending
any such claim.
21.8 Unilateral Termination: Any purported unilateral of this Lease by
Lessee shall not be binding upon Lessor, unless accepted by Lessor in writing.
Tender or delivery to Lessor of the keys to the Premises, or tender of
possession of the Premises, shall not constitute a termination of Lessee's
obligations under this Lease, unless acknowledged by Lessor in writing that such
tender or delivery shall constitute a termination of this Lease.
21.9 Relationship of Landlord and Tenant: Nothing contained in this Lease,
a no course of conduct between Lessor and Lessee, shall be construed as evidence
of any relationship between the parties except as landlord and tenant. Neither
Lessor nor Lessee shall assume any obligation to any third party whereby the
other is or may be liable, unless the parties so agree in a writing signed by
the party sought to be bound thereby.
21.10 Binding Effect of Lease: Unless and until this Lease is signed by or
on behalf of Lessor and a counterpart bearing an original signature of Lessor or
of Lessor's duly authorized agent is delivered to Lessee, this Lease shall be
deemed an executory offer to lease the Premises, which offer shall be subject to
withdrawal at any time prior to acceptance by Lessor. Acceptance shall be
evidenced by Lessor's signature, or the signature of Lessor's duly authorized
agent, to this Lease. The acceptance of rent, or a "deposit" against rent, or a
"binder" by any person shall not constitute acceptance by Lessor of this
executory offer. After this Lease has been fully signed by the parties, and a
counterpart has been delivered to Lessee, this Lease shall be binding upon, and
shall inure to the benefit of, the parties1 respective successors and assigns.
21.11 [Paragraph 21.11 is intentionally deleted.]
21.12 Modification Required by Lenders: If a lender holding a mortgage or
deed of trust affecting any portion of the Building requires, as a condition of
any existing or future mortgage loan or secured loan, the repayment of which is
secured by a financial encumbrance upon the Building, that certain modifications
be made to this Lease, which modifications will not require Lessee to pay any
additional amounts, nor affect the Term of this Lease, nor affect the conduct of
Lessee's business upon the Premises, nor otherwise materially change the rights
or obligations of Lessee under this Lease, Lessee shall, upon request, execute
and deliver such instruments, without charge, to Lessor.
21.13 Payments Applied at Lessor's Discretion: Lessor shall have the right
to apply payments received from Lessee, regardless of Lessee's designation of
such payments, to satisfy obligations of Lessee in such order and in such
amounts as Lessor, in its sole discretion, may elect.
21.14 Limitations to Lessor's Liability: Except for the gross negligence of
the Lessor, Lessor and/or its agents and/or employees shall have no liability
for any loss or damage to property entrusted to employees or agents of Lessor;
nor for loss or damage to any property by theft or otherwise. Lessor and/or its
employees and agents shall not be liable for interference with the light or
other incorporeal hereditaments.
21.15 Notice of Lessor's Default: If Lessor is in default of any of its
obligations under this Lease, or if Lessee deems Lessor to be in default, Lessee
shall advise Lessor by Notice of the nature of the default within ten days after
Lessee has knowledge or actual notice of the act or occurrence which c6nstitutes
the default, and shall afford Lessor a reasonable opportunity to cure.
21.16 Waiver of Trial by Jury: In any action or proceeding brought by
Lessor to enforce any right or remedy under this Lease, or to enforce Tenant's
obligations under this Lease, Lessee shall and hereby does waive trial by jury.
21.17 Authorized Signatures: If Lessee is a corporation or partnership,
Lessee represents and warrants to Lessor that the person signing on behalf of
Lessee is duly authorized by such corporation or partnership to sign on its
behalf; and that the signature of such person is, in the case of a corporation,
duly authorized by resolution of its board of directors; and, in either case, is
binding upon the entity constituting the Lessee.
21.18 Captions: The captions preceding any Article or Paragraph of this
Lease shall not be deemed to be a material part of the Lease, nor shall they be
deemed to control the meaning or content of any material provision; and are for
convenience only.
21.19 Personal Property, Fixtures: All fixtures located upon the Premises
as of the date of this Lease constitutes the sole property of the Lessor. The
Lessee may use such property, without additional rent or charge, during the Term
of this Lease; however, no such property shall be encumbered, transferred,
disposed of or sold by Lessee during the Term. At the end of the Term, all such
property shall be returned to the Lessor in substantially the same condition as
exists on the date of this Lease, reasonable wear and tear from normal
commercial use excepted. Repairs, maintenance and (if required) replacement of
fixtures shall be at the sole cost and expense of the Lessee; and any items of
personal property so replaced shall become the property of the Lessor, and
returned to the Lessor at the end of the Term of this Lease.
Article 22
Right of First Refusal
22.1 (a) If at any time during the Term of this Lease, or during the
Renewal Term, the Lessor elects to sell the Land and/or Building in which the
Premises are located to any third party, prior to accepting unconditionally any
offer from a third party, the Lessor shall first offer to sell the Land and/or
Building to Lessee upon the same terms and conditions, by written Notice. A copy
of any written offer or conditional contract of sale shall be furnished to the
Lessee (but the Lessor may conceal the identity of the offeror from Lessee).
Lessee shall have a period of fifteen (15) days from the time of delivery of the
Lessor's Notice to elect (or not) the Lessee's Right of First Refusal. Failure
to make a timely response by Notice to the Lessor's Notice shall be deemed to be
an election on the part of the Lessee not to exercise the Right of First Refusal
hereby granted.
(b) If Lessee elects to exercise its Right of First Refusal hereby granted,
the Lessee shall enter a formal contract of sale with the Lessor, providing for
the same price, terms and conditions as the original offeror, and providing for
the conveyance by the Lessor of marketable title to the Land and Building not
later than ninety (90) days following the date of such contract, free and clear
of all objectionable encumbrances.
(c) The Lessee's exercise of the Right of First Refusal shall be
conditioned and contingent upon the Lessee's having complied (at the time of
such exercise) with all of the Lessee's obligations under this Lease on the part
of the Lessee to be performed, including the obligation to pay Rent and
Additional Rent; and upon there then being no uncured defaults or breaches by
the Lessee of any of its obligations under this Lease.
(d) The Right of First Refusal hereby granted shall not be exercisable, and
shall not apply, in the event of a no-consideration transfer or
less-than-market-value transfer by any individual Lessor to any spouse of such
person, or to any child or issue, nor to any trust for the benefit of any one or
more of them; nor in the event of a transfer by operation of law to any heir or
distributee of the Lessor or to any joint owner with right of survivorship; nor
in the event of a transfer of any interest in the Land and Building under the
will of any individual Lessor.
Article 23
Post-Closing Obligations under Contract of Sale
(a) Simultaneously with this Lease, the Lessor, as Individual Sellers, and
the Lessee (or the Guarantor of the Lessee, if any) have entered a certain
Contract of Sale for the sale of certain assets of the business known as "The
Sound Mill", which business was formerly conducted by the Individual Sellers at
the Premises, upon the terms and conditions set forth in said Contract of Sale
(the "Contract"). The Contract provides, inter alia, for certain post-closing
obligations of the Seller, including without limitation Seller's post-closing
agreements under paragraphs First, Ninth (b)(iii), Ninth (c), Tenth (a), Tenth
(b), Eleventh (c) and Sixteenth (b) of the Contract. In connection therewith,
the Seller has agreed to indemnify, defend and hold Purchaser harmless from and
against all lost, cost, expense (including reasonable attorneys' fees) and
damage incurred by Purchaser as a result of Seller's failure to perform any of
Seller's post-Closing obligations, representations or warranties under the
Contract.
(b) Further, in connection therewith, the Lessor represents and warrants ~6
the Lessee that there is only one (1) mortgage currently encumbering the
Premises in the approximately principal balance of $88,000.00 (which is paid to
date) and that the Premises are otherwise owned by Xxxxxx Xxxxxxxx and Xxxxx
Xxxxxxxx in fee simple title, free and clear of all liens and encumbrances.
Lessors agree that for a period of two (2) years from the Commencement Date, the
Lessors will not convey title to or re-mortgage the existing mortgage or
otherwise incurese the total mortgage balance encumbering the Premises. In the
event of the Seller's failure to perform any of the Seller's post-Closing
obligations referenced in paragraph Nineteenth (a) of the Contract, the Lessee
shall have the right to offset the Purchaser's loss, cost, expense or damage
against the Rent. It is mutually acknowledged by Lessor and Lessee that this
provision is part of the express consideration for the making of the Contract
and of this Lease. At Lessee's option, Lessee may record a memorandum of this
Lease.
(c) Capitalized nouns which are not specifically defined in this Lease
shall have the same meaning as in the Contract.
IN WITNESS WHEREOF, this Lease has been signed as of the date stated in
Article 1.
LANDLORD: TENANT:
Xxxxxx Electronics, Inc.
______________________________ By:____________________
Xxxxxx Xxxxxxxx
______________________________
Xxxxx Xxxxxxxx
State of New York )
County of Westchester ) ss.:
On , 1998, before me, a Notary Public of the State of New York, personally
appeared XXXXXX XXXXXXXX and XXXXX XXXXXXXX, persons known to me, who did each
acknowledge to me that each signed the foregoing instrument as his/her free act
and deed.
____________________________________
Notary Public
State of New York )
County of Westchester ) ss.:
On , 1998, before me, a Notary Public of the State of New York, personally
appeared , a person known to me, who resides at , and is the of XXXXXX
ELECTRONICS, Inc., the corporation which executed the foregoing instrument; that
he knows the seal of said corporation, that the seal was affixed by order of the
Board of Directors of said corporation, and that he signed his name, as an
officer thereof, pursuant to authority granted to him by the Board of Directors
of said corporation.
____________________________________
Notary Public