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EXHIBIT 10.17
FIFTH AMENDMENT OF LEASE
THIS FIFTH AMENDMENT OF LEASE (this "Amendment") dated as of
May 30, 1997, between ▇▇▇▇ ▇▇▇▇▇▇▇▇ ASSOCIATES L.P., a Delaware limited
partnership having an office c/o Mendik Realty Company, Inc., ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Landlord") and THE MUTUAL LIFE INSURANCE
COMPANY OF NEW YORK, a New York corporation having an office at ▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Tenant").
W I T N E S S E T H:
WHEREAS, by Agreement of Lease, dated as of December 17, 1990
(the "Original Lease"), as amended by an Amendment of Lease, dated as of April
26, 1996 (the "First Amendment"), a Second Amendment of Lease, dated as of
August 6, 1996 (the "Second Amendment"), a Third Amendment of Lease, dated as of
December 18, 1996 (the "Third Amendment") and a Fourth Amendment of Lease, dated
as of January 14, 1997, the Original Lease, as amended by the First Amendment,
the Second Amendment, the Third Amendment and the Fourth Amendment, is
hereinafter collectively referred to as the "Lease"), Landlord leased to Tenant,
and Tenant hired from Landlord, certain premises (the "Premises") as more
particularly described in the Lease, in the building known as and by the address
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ (the "Building"); and
WHEREAS, Mendik 1740 Corp. (the "Corporation") and Tenant
entered into a letter agreement, dated as of April 26, 1996, as amended by
amendments thereto
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dated December 18, 1996 and January 14, 1997 (collectively, the "Letter
Agreement") with respect to the conversion of the Building to a condominium form
of ownership and;
WHEREAS, Landlord delivered to Tenant a letter (the "Notice"),
dated April__, 1997, pursuant to which Landlord elected to convert the Building
to a condominium form of Ownership; and
WHEREAS, pursuant to the Letter Agreement, the Lease is to be
amended as provided herein in the event Landlord has delivered to Tenant the
Notice.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and in the Lease, of Ten Dollars ($10) and of other good and
valuable consideration, the mutual receipt and legal sufficiency of which are
hereby acknowledged, the parties hereto, for themselves, their legal
representatives, successors and assigns, hereby agree as follows:
1. Unless otherwise defined herein, all capitalized terms used
herein shall have the meaning ascribed to such terms in the Lease.
2. Effective as of the date hereof, the lease is hereby
amended as follows:
A. Landlord and Tenant hereafter shall continuously
and in good faith use their diligent efforts to implement the economic
incentives offered to Tenant by the City of New York (the "City") and the New
York City Industrial Development Agency (the "▇▇▇") in the form of reductions in
Taxes and commercial rent and occupancy taxes (the "Economic Incentive
Package"). For purposes hereof, it is expressly agreed that the Economic
Incentive Package does not include sales tax incentives or the BIR Reductions.
Landlord acknowledges that the implementation of the Economic Incentive Package
shall entail, among other things, converting the Building to
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a condominium form of ownership, deeding units leased to Tenant to the ▇▇▇ for
subsequent lease to Landlord, subleasing such units to Tenant, exempting such
units deeded to the ▇▇▇ from Taxes, and entering into certain other subleases
between Tenant and the ▇▇▇. Notwithstanding any provision hereof to the
contrary, Tenant acknowledges that, in connection with the implementation of the
Economic Incentive Package, in no event shall Landlord be required to mortgage
its interest in the Building or the Real Property or the income earned
therefrom.
B. Landlord and Tenant each acknowledges that the
Economic Incentive Package is to be entirely for the benefit of Tenant, and is
not for the benefit of Landlord or any other party. Notwithstanding the
foregoing, except to the extent provided in the final sentence of this Section
2(B) and in Section 2(K) hereof, if any other tenant or occupant shall claim
that it is entitled to a reduction in any real estate tax escalation payment
which such other tenant or occupant would otherwise be obligated to pay but for
any action taken to implement the Economic Incentive Package, or but for the
implementation of the Economic Incentive Package (including, without limitation,
the fact that all or any portion of the Building shall be exempt from the
payment of Taxes, or shall be subject to payments in lieu of real estate taxes)
and such claim shall be sustained pursuant to a final non-appealable
adjudication, then Tenant shall pay to Landlord, as additional rent, the amount
of such reduction, provided that Landlord shall have diligently and in good
faith defended such claim, and shall have consulted with Tenant in connection
therewith, as provided herein. Tenant shall also pay to Landlord, as additional
rent, the reasonable costs and expenses (including, without limitation,
reasonable attorneys' fees and disbursements) incurred by Landlord in defending
any
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such claim. Landlord shall diligently and in good faith defend and such claim
made by such tenant or occupant using counsel reasonably acceptable to Tenant
(it being agreed that Proskauer Rose LLP are deemed to be acceptable to Tenant),
and shall consult with Tenant in connection therewith. Notwithstanding the
provisions of this Section 2(B), if and to the extent pursuant to Documentation
(hereinafter defined), Landlord shall be reimbursed for the amount of such
reductions and such costs and expenses, or if and to the extent such tenant or
occupant shall reimburse Landlord for such costs and expenses, Landlord shall
not look to Tenant for the amount reimbursed.
C. Landlord and Tenant shall negotiate in good faith
documentation to implement the Economic Incentive Package (collectively, the
"Documentation") and, upon agreement by the parties to the terms of the
Documentation, shall execute the Documentation, provided the Documentation is
commercially reasonable, is consistent with the provisions hereof, and is
otherwise consistent with documentation entered into in similar transactions
with the City and the ▇▇▇. Tenant agrees to pay the reasonable expenses incurred
by Landlord in connection with the transactions contemplated hereby (including
all costs of negotiating the Documentation, except as expressly provided below,
and all costs of removing the condominium regime from the Building within six
(6) months after the termination of the Economic Incentive Package), other than
(i) those expenses which Landlord would have incurred without regard to the
application hereof, and (ii) legal fees and disbursements incurred by Landlord
in connection with the negotiation of the Documentation. Tenant shall pay for
all of Tenant's expenses in connection with the transactions contemplated
hereby, except that Landlord shall contribute an amount not to exceed Thirty
Thousand Dollars
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($30,000) (the "Fund") toward Tenant's actual, reasonable out-of-pocket legal
fees in the preparation and negotiation of the plan (the "Condominium Plan") for
conversion of the Building to a condominium form of ownership. Landlord shall
disburse a portion of the Fund to Tenant from time to time, within thirty (30)
days after receipt of the items set forth herein, provided that on the date of a
request and on the date of disbursement from the Fund no Event of Default shall
have occurred and be continuing. Disbursements from the Fund shall not be made
more frequently than monthly, and shall be in an amount equal to the aggregate
amounts theretofore paid or payable (as certified by an officer of Tenant) to
Tenant's attorneys which have not been the subject of a previous disbursement
from the Fund. Landlord's obligation to make the disbursements from the Fund
shall be subject to Landlord's receipt of a request for such disbursement from
Tenant signed by an officer of Tenant, together with the certification required
above and copies of all receipts, invoices and bills for the legal fees incurred
in connection with the preparation and negotiation of the Condominium Plan which
are to be paid from the requested disbursement or which have been paid by Tenant
and for which Tenant is seeking reimbursement. In no event shall the aggregate
amount paid by Landlord to Tenant under this Paragraph 3 exceed the amount of
the Fund. Upon the completion of the Condominium Plan, any amount of the Fund
which has not been previously disbursed shall be retained by Landlord. Upon the
disbursement of the entire Fund (or the portion thereof if upon completion of
the Condominium Plan the Fund is not exhausted), Landlord shall have no further
obligation or liability whatsoever to Tenant for further disbursement of any
portion of the Fund to Tenant. Any costs to complete the
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Condominium Plan in excess of the Fund shall be the sole responsibility and
obligation of the Tenant.
D. If as a result of a requirement of the City or the ▇▇▇
Landlord shall be required to execute any Documentation or take any action to
implement the Economic Incentive Package and Landlord shall refuse to execute or
perform the same, then Landlord shall have no obligation to convert the Building
to a condominium form of ownership or otherwise implement the Economic Incentive
Package, provided that, if the reason for Landlord's refusal is that the
Documentation requires that Landlord mortgage its interest in the Building or
the Real Property or the income earned therefrom, then the First Amendment shall
be deemed to be modified by the provisions of Section 2(E) hereof. If any
dispute shall arise between Landlord and Tenant as to whether any Documentation
to be executed by Landlord or Tenant complies with the provisions hereof
(including Section 2(D) hereof) and, accordingly, whether Landlord or Tenant is
obligated to execute the same, either party may submit such dispute to expedited
binding arbitration in the City of New York under the Expedited Procedures
provisions of the Commercial Arbitration Rules of the American Arbitration
Association or any successor thereto. The authority of the arbitrator shall be
limited solely to determining whether such Documentation complies with the
provision hereof and, accordingly, whether Landlord or Tenant, as the case may
be, is obligated to execute such Documentation. The reasonable arbitration costs
of the successful party to such arbitration (including, without limitation, such
party's reasonable attorneys' fees and disbursements) shall be paid by the
losing party. If the arbitrator shall determine that Tenant is obligated to
execute such Documentation and Tenant shall fail or refuse to execute the same
promptly after written
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notice of the arbitrator's decision is delivered to Tenant, then Landlord shall
have no further obligation to convert the Building to condominium ownership or
otherwise implement the Economic Incentive Package, and the First Amendment
shall be deemed to be modified by the provisions of Section 2(E) hereof. If the
arbitrator shall determine that Landlord is obligated to execute such
Documentation and, notwithstanding such determination, Landlord shall fail or
refuse to execute the same within five (5) Business Days after written notice of
the arbitrator's decision is delivered to Landlord, then Landlord shall have no
obligation to convert the Building to a condominium form of ownership or
otherwise implement the Economic Incentive Package, the First Amendment shall
not be deemed to be modified by the provisions of Section 2(E) hereof, and
Tenant, as its sole remedy, shall be entitled to receive the arbitration fees,
attorneys' fees and disbursements referred to herein. If the arbitrator shall
determine that Landlord is not obligated to execute such Documentation and the
arbitrator does not determine that Tenant must execute other Documentation in
lieu thereof, and if Landlord shall fail or refuse, within five (5) Business
Days after receipt of the determination of the arbitrator to execute such
Documentation to be executed by Landlord, the First Amendment shall be deemed to
be modified by the provisions of Section 2(E) hereof.
E. If Landlord shall deliver the Notice and the Building shall
be converted to a condominium form of ownership, or if pursuant to the express
provisions hereof, the First Amendment is deemed to be modified by the
provisions of this Section 2(E), then (i) Section 3(A)(vi) of the First
Amendment shall be deemed deleted and the following shall be inserted in lieu
thereof: "(vi) Six Million Two Hundred Sixty-Nine Thousand Nine Hundred Dollars
($6,269,900) per annum for the period commencing on
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June 1, 2011 and ending on May 31, 2016 ($522,499.71 per month)"; and (ii)
Section 3(B) of the First Amendment shall be deemed deleted. If the Building
shall be converted to a condominium form of ownership in order to implement the
Economic Incentive Package, then the following shall be inserted at the end of
Article 3 of the First Amendment: "If the Building is converted to a condominium
form of ownership in order to implement the Economic incentive Package, and the
Taxes in respect of any condominium unit(s) leased solely to Tenant shall be
abated as a result thereof, the Fixed Rent payable under this Lease shall be
reduced, for the period that such unit(s) are subject to such abatement, by an
amount equal to the Base Taxes multiplied by the percentage interest ascribed to
such unit(s) in the Declaration of Condominium for the Building to be entered
into in connection with the conversion of the Building to a condominium form of
ownership. If any Taxes shall be payable for such unit(s) during the period that
such unit(s) are subject to an abatement, Tenant shall pay the same to Landlord
as additional rent within ten (10) days after demand therefor (but in no event
prior to fifteen (15) days prior to the date such Taxes are payable to the
applicable Governmental Authorities). No Tax Payments shall be payable with
respect to any unit(s) as to which Taxes are abated as provided herein for as
long as Taxes are abated for such unit(s) as provided herein. It is contemplated
that any payments in lieu of real estate taxes with respect to such unit(s) will
be paid by Tenant directly to the City or the ▇▇▇."
F. Notwithstanding any provision hereof to the contrary,
Landlord shall have no obligation to convert the Building to a condominium form
of ownership or otherwise implement the Economic Incentive Package, and the
First Amendment shall be deemed to be modified by the provision of Section 2(E)
hereof, if Tenant shall elect not
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to receive the Economic Incentive Package specified in the Resolution from the
City and the ▇▇▇ or such Economic Incentive Package is not available to Tenant
by reason of Tenant's failing to execute any Documentation required by the City
or the ▇▇▇ or otherwise failing to comply with the requirements of the City or
the ▇▇▇.
G. If, at any time after the Building has been converted to a
condominium form of ownership pursuant to the provision hereof, Tenant shall at
any time elect to terminate or abandon the portion of the Economic Incentive
Package consisting of reduced, abated or exempted Taxes, then upon request by
Tenant, Landlord shall reasonably cooperate with Tenant in connection therewith,
at Tenant's sole cost and expense.
H. If the Building has been submitted to condominium form of
ownership and if Landlord shall fail or refuse to contest the asserted valuation
(including the commencement and prosecution of applicable tax certiorari
proceedings) for the Building, then Tenant may, to the extent permitted by
Requirements and not prohibited by the Documentation, with no cost, expense or
liability to Landlord, contest the assessed valuation of any condominium units
leased or subleased by Landlord or the ▇▇▇ solely to Tenant. Landlord shall
reasonably cooperate with Tenant in connection therewith, provided the same
shall impose no cost, expense or liability on Landlord.
I. Landlord and Tenant acknowledge that no transfer of the
Real Property to the ▇▇▇ which may be entered into in order to implement the
Economic Incentive Package shall be deemed to be (x) a transfer of Landlord's
interest in the Real Property for purposes of Section 37.2 or Article 41 of the
Lease, or (y) an acquisition, taking or condemnation for purposes of Article 11
of the Lease.
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J. Intentionally Omitted.
K. Subject to the provisions of this Section 2(K), Landlord
shall include, in each lease for space in the Building which Landlord shall
enter into after the date hereof, a clause to the effect that if Landlord shall
implement, or shall have implemented, an economic incentive package for the
benefit of a tenant or other occupant of the Building and, as a result thereof,
Taxes shall be reduced or abated, in whole or in part, with respect to all or
any portion of the Building, then for purposes of calculating the tax escalation
payment payable by such tenant for any space leased by such tenant (other than
any space leased by such tenant which is subject to payments in lieu of taxes),
Taxes shall be the Taxes which would have been payable without regard to such
reduction or abatement. Notwithstanding the foregoing, (i) if Landlord shall not
include such clause in any such lease, Tenant shall have no obligation to
reimburse Landlord, as required by Section 2(B) hereof, with respect to any
reduction in real estate tax escalation payments to which the tenant under such
lease may be entitled or the costs and expenses incurred by Landlord in
attempting to collect such real estate tax escalation payments from such taxes,
and (ii) Landlord shall not be obligated to include such clause in any lease
after (x) the date Landlord otherwise is no longer obligated to convert the
Building to a condominium form of ownership, or (y) if the Building has been
converted, after the termination of the condominium or the Economic Incentive
Package.
L. Subject to the provisions of this Section 2(L), Landlord
shall include in each lease for space in the Building which Landlord shall enter
into after the date hereof a clause to the effect that if there shall be
implemented an economic incentive package for the benefit of the Tenant or other
occupant of the Building and, as result
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thereof, Landlord's electric costs shall be reduced or abated in whole or in
part with respect to all or any portion of the Building, then for purposes of
calculating the electric costs and operating expense escalation payment payable
by such tenant, Landlord's electric costs and operating expense escalation
payment payable by such tenants. Landlord's electric costs and Building
operating expenses shall be the electric costs and Building operating payments
which would have been payable with regard to such reduction or abatement.
Notwithstanding the foregoing, (i) if Landlord shall not include such clause in
any such lease, Tenant shall have no obligation to reimburse Landlord, as
required by Section 8(B) of the First Amendment, with respect to any reduction
in electric payments or operating expenses to which the tenant under such lease
may be entitled and (ii) Landlord shall not be obligated to include such clause
in any lease after (x) the date Tenant abandons its efforts to receive the BIR
Reductions, (y) if Tenant shall receive the BIR Reductions, after the
termination of the BIR Reductions or (z) the date electricity consumed at the
Premises leased by Tenant which are subject to the BIR Reductions are directly
metered for electricity.
3. Each party represents and warrants to the other that it has
not dealt with any broker or person in connection with this Amendment other than
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, Inc. ("Broker"). The execution and delivery of this
Amendment by each party shall be conclusive evidence that such party has relied
upon the foregoing representation and warranty. Tenant shall indemnify and hold
Landlord harmless from and against any and all claims for commission, fee or
other compensation by any person or broker (other than Broker) who shall claim
to have dealt with Tenant in connection with this Amendment and for any and all
costs incurred by Landlord in connection with
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such claims, including, without limitation, reasonable attorneys' fees and
disbursements. Landlord shall indemnify and hold Tenant harmless from and
against any and all claims for commission, fee or other compensation by any
person or broker (including, without limitation, the Broker) who shall claim to
have dealt with Landlord in connection with this Amendment and for any and all
costs incurred by Tenant in connection with such claims, including, without
limitation, reasonable attorneys' fees and disbursements. The provisions of this
Paragraph shall survive the Expiration Date.
4. The provisions of Section 37.2 of the Lease are hereby
incorporated by reference in this Amendment, as if set forth in full in this
Amendment, except that all references therein to the Lease shall be deemed to be
references to the Lease as amended by this Amendment.
5. The Lease, as amended by this Amendment, constitutes the
entire understanding between the parties hereto with respect to the Premises and
may not be waived, changed, modified or discharged orally but only by an
agreement in writing signed by the party against whom enforcement of any such
waiver, change, modification or discharge is sought.
6. This Amendment shall not be binding on or enforceable
against either party unless and until both parties shall have executed and
delivered a fully executed counterpart of this Amendment.
7. As modified by this Amendment, the Lease and all covenants,
agreements, terms and conditions thereof shall remain in full force and effect
and are hereby in all respects ratified and confirmed.
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IN WITNESS WHEREOF, Landlord and Tenant have duly executed
this Amendment as of the day and year first above written.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ASSOCIATES L.P.
By: Vornado ▇▇▇▇ ▇▇▇▇▇▇▇▇ Associates, L.L.C.
By: Vornado Realty Trust as authorized signatory
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Secretary
THE MUTUAL LIFE INSURANCE COMPANY OF
NEW YORK
By: /s/ ▇▇▇▇▇▇ ▇. Bank
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Name: ▇▇▇▇▇▇ ▇. Bank
Title: Vice President
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STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 25th day of June, 1997, before me personally came ▇▇▇▇
▇▇▇▇▇, to me known, who, being by me duly sworn, did depose and say that he
resides at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇; that he is the Vice
President Corporate Services of THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK,
the corporation described and which executed the foregoing instrument; and that
he signed his name thereto by order of the board of directors of said
corporation.
/s/ ▇▇▇▇▇ ▇. ▇▇▇
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Notary Public
Stamped: ▇▇▇▇▇ ▇. ▇▇▇, Notary Public, State of New York, No. ▇▇-▇▇▇▇▇▇▇,
Qualified in Bronx County, Commission Expires April 15, ▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ )
) SS.:
COUNTY OF )
On the 25h day of June, 1997, before me personally came ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, to me known, who, being by me duly sworn, did depose and say that
she resides at Park 80w, PLII, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇; that she is the Secretary
of Vornado Realty Trust which is the Authorized Signatory of ▇▇▇▇ ▇▇▇▇▇▇▇▇
Associates L.L.C., which is a general partner of ▇▇▇▇ ▇▇▇▇▇▇▇▇ ASSOCIATES L.P.,
the limited partnership described in and which executed the foregoing
instrument; and that she signed her name thereto by order of the members of said
liability company and as the act and deed of said partnership.
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇
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Notary Public
Stamped: ▇▇▇ Peligra, Notary Public of New Jersey, My Commission Expires Feb.
25, 2001
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