Exhibits have been included in
copies of this Report filed with the Securities and Exchange
Commission. We will provide, without charge, a copy of these exhibits
to each stockholder upon the written request of any such stockholder.
All such requests should be directed to G-III Apparel Group, Ltd., 512
Seventh Avenue, 35th floor, New York, New York 10018,
Attention: Mr. Wayne S. Miller,
Secretary.
Table of Contents
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly
authorized.
 |
G-III APPAREL GROUP,
LTD. |
|
|
|
|
By |
/s/ Morris
Goldfarb
Morris Goldfarb,
Chief
Executive Officer |
May 8, 2006
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the
registrant and in the capacities and on the date
indicated.
|
|
|
|
|
| Signature |
|
Title |
|
Date |
|
| /s/ Morris
Goldfarb |
|
Director,
Chairman of the Board and Chief Executive Officer (principal executive
officer) |
|
May 8,
2006 |
|
| Morris Goldfarb |
|
| /s/ Neal
Nackman |
|
Chief Financial
Officer and Treasurer (principal financial and accounting
officer) |
|
May 8,
2006 |
|
| Neal S. Nackman |
|
| /s/ Sammy
Aaron |
|
Director and Vice
Chairman |
|
May 8,
2006 |
|
| Sammy Aaron |
|
| /s/ Thomas J.
Brosig |
|
Director |
|
May 8,
2006 |
|
| Thomas J.
Brosig |
|
| /s/ Pieter
Deiters |
|
Director |
|
May 8,
2006 |
|
| Pieter
Deiters |
|
| /s/ Alan Feller |
|
Director |
|
May 8,
2006 |
|
| Alan
Feller |
|
| /s/ Carl Katz |
|
Director |
|
May 8,
2006 |
|
| Carl
Katz |
|
| |
|
Director |
|
|
|
| Laura
Pomerantz |
|
| |
|
Director |
|
|
|
| Willem
van
Bokhorst |
|
| /s/ Richard
White |
|
Director |
|
May 8,
2006 |
|
| Richard
White |
|
As Amended 4/17/97
BY-LAWS
OF
G-III APPAREL GROUP, LTD.
ARTICLE I
OFFICES
Section 1. The registered office shall be in the City of Dover, County
of Kent, State of Delaware.
Section 2. The Corporation may also have offices at such other places
both within and without the State of Delaware as the board of directors may from
time to time determine or the business of the corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. All meetings of the stockholders for the election of
directors shall be held at such place as may be fixed from time to time by the
board of directors either within or without the State of Delaware as shall be
designated from time to time by the board of directors and stated in the notice
of the meeting or in a duly executed waiver of notice thereof. Meetings of
stockholders for any other purpose may be held at such time and place, within or
without the State of Delaware, as shall be stated in the notice of the meeting
or in a duly executed waiver of notice thereof. Stockholders
need not be physically present to participate in a meeting of stockholders, but
may participate by means of conference telephone or other similar communications
equipment by means of which all persons participating in the meeting can hear
each other.
Section 2. Annual meetings of stockholders, commencing with the year
1990, shall be held on the second Tuesday of December if not a legal holiday,
and if a legal holiday, then on the next secular day following, at 10:00 A.M.,
or at such other date as shall be designated from time to time by the board of
directors and stated in the notice of the meeting, at which they shall elect by
a majority vote a board of directors, and transact such other business as may
properly be brought before the meeting.
Section 3. Written notice of the annual meeting stating the place,
date and hour of the meeting shall be given to each stockholder entitled to vote
at such meeting not less than ten nor more than sixty days before the date of
the meeting.
Section 4. The officer who has charge of the stock ledger of the
Corporation shall prepare and make, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during
-2-
ordinary business hours, for a period of at least ten days prior to the meeting,
either at a place within the city where the meeting is to be held, which place
shall be specified in the notice of the meeting, or, if not so specified, at the
place where the meeting is to be held. The list shall also be produced and kept
at the time and place of the meeting during the whole time thereof, and may be
inspected by any stockholder who is present.
Section 5. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the certificate of
incorporation, may be called by the president or secretary and shall be called
by the chairman of the board, president or secretary at the request in writing
of a majority of the board of directors, or at the request in writing of
stockholders owning a majority in amount of the entire capital stock of the
Corporation issued and outstanding and entitled to vote. Such request shall
state the purpose or purposes of the proposed meeting.
Section 6. Written notice of a special meeting stating the place, date
and hour of the meeting and the purpose or purposes for which the meeting is
called, shall be given not less than ten nor more than sixty days before the
date of the meeting, to each stockholder entitled to vote at such meeting.
Section 7. Business transacted at any special meeting of stockholders
shall be limited to the purposes stated in the notice.
-3-
Section 8. The holders of a majority of the stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall constitute a quorum at all meetings of the stockholders for the
transaction of business except as otherwise provided by statute or by the
certificate of incorporation. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders entitled to
vote thereat, present in person or represented by proxy, shall have power to
adjourn the meeting from time to time, without notice other than announcement at
the meeting, until a quorum shall be present or represented. At such adjourned
meeting at which a quorum shall be present or represented any business may be
transacted which might have been transacted at the meeting as originally
notified. If the adjournment is for more than thirty days, or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice of
the adjourned meeting shall be given to each stockholder of record entitled to
vote at the meeting.
Section 9. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which by express provision of the statutes or of
the certificate of incorporation or these by-laws, a different vote is required
in which case such express provision shall govern and control the decision of
such question.
Section 10. Unless otherwise provided in the certificate of
incorporation each stockholder shall at every meeting of the stockholders be
entitled to one vote in
-4-
person or by proxy for each share of the capital stock having voting power held
by such stockholder, but no proxy shall be voted on after three years from its
date, unless the proxy provides for a longer period.
Section 11. Unless otherwise provided in the certificate of
incorporation, any action required to be taken at any annual or special meeting
of stockholders of the Corporation, or any action which may be taken at any
annual or special meeting of such stockholders, may be taken without a meeting,
without prior notice and without a vote, if a consent or consents in writing,
setting forth the action so taken, shall be signed by the holders of outstanding
stock having not less than the minimum number of votes that would be necessary
to authorize or take such action at a meeting at which all shares entitled to
vote thereon were present and voted and shall be delivered to the Corporation by
delivery to its registered office in the State of Delaware, its place of
business, or the secretary of the Corporation. Every written consent shall bear
the date of signature of each stockholder who signs the consent and no written
consent shall be effective to take the corporate action referred to therein
unless, within sixty days of the earliest dated consent delivered in the manner
required by this Section to the Corporation, written consents signed by a
sufficient number of holders to take action are delivered to the Corporation by
delivery to its registered office in the State of Delaware, its principal place
of business, or the secretary of the Corporation. Delivery made to the
Corporation's registered office shall be by hand or by certified or registered
mail, return receipt requested. Prompt notice of the taking of the corporate
action
-5-
without a meeting by less than unanimous written consent shall be given to those
stockholders who have not consented in writing.
ARTICLE III
DIRECTORS
Section 1. The number of directors which shall constitute the whole
board shall be fixed from time to time by the board of directors or stockholders
but shall not be less than two. The directors shall be elected at the annual
meeting of the stockholders, except as provided in Section 2 of this Article,
and each director elected shall hold office until his respective successor is
elected and qualified. The directors need not be stockholders.
Section 2. Except as otherwise provided by statute or by the
certificate of incorporation, vacancies and newly created directorships
resulting from any increase in the authorized number of directors may be filled
by a majority of the directors then in office, though less than a quorum, or by
a sole remaining director, and the directors so chosen shall hold office until
the next annual election and until their successors are duly elected and shall
qualify, unless sooner displaced. If there are no directors in office, then an
election of directors may be held in the manner provided by statute. If, at the
time of filling any vacancy or any newly created directorship, the directors
then in office shall constitute less than a majority of the whole board (as
constituted immediately prior to any such increase), the Court of Chancery may,
upon application of any stockholder or stockholders holding at least ten percent
of the total number of
-6-
the shares at the time outstanding having the right to vote for such directors,
summarily order an election to be held to fill any such vacancies or newly
created directorships, or to replace the directors chosen by the directors then
in office.
Section 3. The business of the Corporation shall be managed by or
under the direction of its board of directors which may exercise all such powers
of the corporation and do all such lawful acts and things as are not by statute
or by the certificate of incorporation or by these by-laws directed or required
to be exercised or done by the stockholders.
THE CHAIRMAN OF THE BOARD
Section 4. The board of directors at its first meeting after each
annual meeting of stockholders shall choose from among its members a chairman.
The chairman of the board of directors shall preside at all meetings of
stockholders and of the board of directors. He shall have such other powers and
perform such other duties as are provided in these by-laws and, in addition
thereto, as the board of directors may from time to time determine. The chairman
of the board of directors shall not be deemed an officer of the Corporation
under any provision of the statutes or of the certificate of incorporation or
these by-laws.
-7-
MEETINGS OF THE BOARD OF DIRECTORS
Section 5. The board of directors of the Corporation may hold
meetings, both regular and special, either within or without the State of
Delaware.
Section 6. The first meeting of each newly elected board of directors
shall be held at such time and place as shall be fixed by the vote of the
stockholders at the annual meeting and no notice of such meeting shall be
necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present. In the event of the failure of the
stockholders to fix the time or place of such first meeting of the newly elected
board of directors, or in the event such meeting is not held at the time and
place so fixed by the stockholders, the meeting may be held at such time and
place as shall be specified in a notice given as hereinafter provided for
special meetings of the board of directors, or as shall be specified in a
written waiver signed by all of the directors.
Section 7. Regular meetings of the board of directors may be held
without notice at such time and at such place as shall from time to time be
determined by the board.
Section 8. Special meetings of the board may be called by the chairman
of the board or president on three days' notice to each director, either
personally or by mail or by telegram; special meetings shall be called by the
chairman of the board, the
-8-
president or secretary in like manner and on like notice on the written request
of two directors.
Section 9. At all meetings of the board a majority of the directors
shall constitute a quorum for the transaction of business and the act of a
majority of the directors present at any meeting at which there is a quorum
shall be the act of the board of directors, except as may be otherwise
specifically provided by statute or by the certificate of incorporation. If a
quorum shall not be present at any meeting of the board of directors, the
directors present thereat may adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum shall be present.
Section 10. Unless otherwise restricted by the certificate of
incorporation or these by-laws, any action required or permitted to be taken at
any meeting of the board of directors or of any committee thereof may be taken
without a meeting if all members of the board or committee, as the case may be,
consent thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the board or committee.
Section 11. Unless otherwise restricted by the certificate of
incorporation or these by-laws, members of the board of directors, or any
committee designated by the board of directors, may participate in a meeting of
the board of directors, or any committee, by means of conference telephone or
similar communications equipment by
-9-
means of which all persons participating in the meeting can hear each other, and
such participation in a meeting shall constitute presence in person at the
meeting.
COMMITTEES OF DIRECTORS
Section 12. The board of directors may, by resolution passed by a
majority of the whole board, designate one or more committees, each committee to
consist of one or more of the directors of the Corporation. The board may
designate one or more directors as alternate members of any committee, who may
replace any absent or disqualified member at any meeting of the committee. In
the absence or disqualification of a member of a committee, the member or
members thereof present at any meeting and not disqualified from voting, whether
or not he or they constitute a quorum, may unanimously appoint another member of
the board of directors to act at the meeting in the place of any such absent or
disqualified member. Any such committee, to the extent provided in the
resolution of the board of directors, shall have and may exercise all the powers
and authority of the board of directors in the management of the business and
affairs of the Corporation, and may authorize the seal of the Corporation to be
affixed to all papers which may require it; but no such committee shall have the
power or authority in reference to amending the certificate of incorporation,
adopting an agreement of merger or consolidation, recommending to the
stockholders the sale, lease or exchange of all or substantially all of the
Corporation's property and assets, recommending to the stockholders a
dissolution of the Corporation or a revocation of a dissolution, or amending the
by-laws of the
-10-
Corporation; and, unless the resolution or the certificate of incorporation
expressly so provides, no such committee shall have the power or authority to
declare a dividend or to authorize the issuance of stock. Such committee or
committees shall have such name or names as may be determined from time to time
by resolution adopted by the board of directors.
Section 13. Each committee shall keep regular minutes of its meetings
and report the same to the board of directors when required.
COMPENSATION OF DIRECTORS
Section 14. Unless otherwise restricted by the certificate of
incorporation or these by-laws, the board of directors shall have the authority
to fix the compensation of directors. The directors may be paid their expenses,
if any, of attendance at each meeting of the board of directors and may be paid
a fixed sum for attendance at each meeting of the board of directors or a stated
salary as director. Nothing herein shall preclude any director from serving the
Corporation in any other capacity and receiving compensation therefor. Members
of special or standing committees may be allowed like compensation for attending
committee meetings.
-11-
REMOVAL OF DIRECTORS
Section 15. Unless otherwise restricted by the certificate of
incorporation or these by-laws, any director or the entire board of directors
may be removed, with or without cause, by the holders of a majority of shares
entitled to vote at an election of directors.
ARTICLE IV
NOTICES
Section 1. Whenever, under the provisions of the statutes or of the
certificate of incorporation or of these by-laws, notice is required to be given
to any director or stockholder, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
director or stockholder, at his address as it appears on the records of the
corporation, with postage thereon prepaid, and such notice shall be deemed to be
given at the time when the same shall be deposited in the United States mail.
Notice to directors may also be given by telegram, telex or telecopy with
receipt confirmed by telecopy.
Section 2. Whenever any notice is required to be given under the
provisions of the statutes or of the certificate of incorporation or of these
by-laws, a waiver thereof in writing, signed by the person or persons entitled
to said notice, whether before or after the time stated therein, shall be deemed
equivalent to notice. A person entitled to notice of any meeting of the board of
directors or stockholders, as
-12-
the case may be, waives such notice if he appears in person or, in the case of a
stockholder, by proxy at such meeting, except when the person attends a meeting
for the express purposes of objecting, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened.
ARTICLE V
OFFICERS
Section 1. The officers of the Corporation shall be chosen by the
board of directors and shall be a chief executive officer, a president, a
vice-president, a secretary and a treasurer. The board of directors may also
choose additional vice-presidents, and one or more assistant secretaries and
assistant treasurers. Any number of offices may be held by the same person,
unless the certificate of incorporation or these by-laws otherwise provide.
Section 2. The board of directors at its first meeting after each
annual meeting of stockholders shall choose a chief executive officer, a
president, one or more vice-presidents, a secretary and a treasurer.
Section 3. The board of directors may appoint such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the board.
-13-
Section 4. The salaries of all officers and agents of the Corporation
shall be fixed by the board of directors.
Section 5. The officers of the Corporation shall hold office until
their successors are chosen and qualify. Any officer elected or appointed by the
board of directors may be removed at any time by the affirmative vote of a
majority of the board of directors. Any vacancy occurring in any office of the
Corporation shall be filled by the board of directors.
THE CHIEF EXECUTIVE OFFICER
Section 6. The chief executive officer shall have general and active
management of the business of the Corporation, and in the absence of the
chairman of the board, shall preside at all meetings of the stockholders and the
board of directors. The chief executive officer shall make reports to the board
of directors and stockholders, and shall perform any and all other duties as are
incident to the office or are properly required of the chief executive officer
by the board of directors. The chief executive officer shall see that all orders
and resolutions of the board of directors are carried into effect.
THE PRESIDENT
Section 7. The president shall have general supervision of the affairs
of the Corporation, shall sign or countersign all certificates, contracts, or
other instruments of the corporation as authorized by the board of directors and
shall have
-14-
such other powers and perform such other duties as are provided in these by-laws
and, in addition thereto, as the board of directors may from time to time
determine.
Section 8. The President shall execute bonds, mortgages and other
contracts requiring a seal, under the seal of the Corporation, except where
required or permitted by law to be otherwise signed and executed and except
where the signing and execution thereof shall be expressly delegated by the
board of directors to some other officer or agent of the Corporation.
THE VICE-PRESIDENTS
Section 9. In the absence of the president or in the event of his
inability or refusal to act, the vice-president (or in the event there be more
than one vice-president, the vice-presidents in the order designated by the
directors, or in the absence of any designation, then in the order of their
election) shall perform the duties of the president, and when so acting shall
have all the powers of and be subject to all the restrictions upon the
president. The vice-presidents shall perform such other duties and have such
other powers as the board of directors may from time to time prescribe.
THE SECRETARY AND ASSISTANT SECRETARY
Section 10. The secretary shall attend all meetings of the board of
directors and all meetings of the stockholders and record all the proceedings of
the meetings of the Corporation and of the board of directors in a book to be
kept for that purpose and shall perform like duties for the standing committees
when required. He
-15-
shall give, or cause to be given, notice of all meetings of the stockholders and
special meetings of the board of directors, and shall perform such other duties
as may be prescribed by the board of directors or president, under whose
supervision he shall be. He shall have custody of the corporate seal of the
Corporation and he, or an assistant secretary, shall have authority to affix the
same to any instrument requiring it and when so affixed, it may be attested by
his signature or by the signature of such assistant secretary. The board of
directors may give general authority to any other officer to affix the seal of
the Corporation and to attest the affixing by his signature.
Section 11. The assistant secretary, or if there be more than one, the
assistant secretaries in the order determined by the board of directors (or if
there be no such determination, then in the order of their election) shall, in
the absence of the secretary or in the event of his inability or refusal to act,
perform the duties and exercise the powers of the secretary and shall perform
such other duties and have such other powers as the board of directors may from
time to time prescribe.
THE TREASURER AND ASSISTANT TREASURERS
Section 12. The treasurer shall have the custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the Corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the Corporation in
such depositories as may be designated by the board of directors.
-16-
Section 13. He shall disburse the funds of the Corporation as may be
ordered by the board of directors, taking proper vouchers for such
disbursements, and shall render to the president and the board of directors, at
its regular meetings, or when the board of directors so requires, an account of
all his transactions as treasurer and of the financial condition of the
Corporation.
Section 14. If required by the board of directors, he shall give the
Corporation a bond (which shall be renewed every six years) in such sum and with
such surety or sureties as shall be satisfactory to the board of directors for
the faithful performance of the duties of his office and for the restoration to
the Corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of whatever
kind in his possession or under his control belonging to the Corporation.
Section 15. The assistant treasurer, or if there shall be more than
one, the assistant treasurers in the order determined by the board of directors
(or if there be no such determination, then in the order of their election),
shall, in the absence of the treasurer or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the treasurer and
shall perform such other duties and have such other powers as the board of
directors may from time to time prescribe.
-17-
ARTICLE VI
INDEMNIFICATION
SECTION 1. The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Corporation) by
reason of the fact that he is or was a director, officer or employee of the
Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the Corporation, and with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best interest
of the Corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
-18-
Section 2. The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer or employee of the Corporation, or is or was serving at the request of
the Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall have
been adjudged to be liable to the Corporation unless and only to the extent that
the Court of Chancery or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Court of Chancery
or such other court shall deem proper.
Section 3. To the extent that a director, officer or employee of the
Corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in Sections 1 or 2 of this Article VI, or
in defense of any claim, issue or matter therein, he shall be indemnified
against expenses (including attorney's fees) actually and reasonably incurred by
him in connection therewith.
-19-
Section 4. Any indemnification under Sections 1 or 2 of this Article
VI (unless ordered by a court) shall be made by the Corporation only as
authorized in the specific case upon a determination that indemnification of the
director, officer or employee is proper in the circumstances because he has met
the applicable standard of conduct set forth in Sections 1 or 2 of this Article
VI. Such determination shall be made (a) by the board of directors by a majority
vote of a quorum consisting of directors who were not parties to such action,
suit or proceeding, or (b) if such a quorum is not obtainable, or, even if
obtainable a quorum of disinterested directors so directs, by independent legal
counsel in a written opinion, or (c) by the stockholders.
Section 5. Expenses incurred by a director, officer or employee of the
Corporation in defending a civil or criminal action, suit or proceeding may be
paid by the Corporation in advance of the final disposition of such action, suit
or proceeding upon receipt of an undertaking by or on behalf of such director,
officer or employee to repay such amount if it shall ultimately be determined
that he is not entitled to be indemnified by the Corporation as authorized in
this Article.
Section 6. The indemnification and advancement of expenses provided
by, or granted pursuant to, the other Sections of this Article shall not be
deemed exclusive of any other rights to which a person seeking indemnification
or advancement of expenses may be entitled under any by-law, agreement, or vote
of stockholders or disinterested directors or otherwise, both as to action in
his official capacity and as to action in another capacity while holding such
office.
-20-
Section 7. The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the Corporation, or is or was serving at the request of the Corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
him and incurred by him in any such capacity, or arising out of his status as
such, whether or not the Corporation would have the power to indemnify him
against such liability under the provisions of this Article.
Section 8. The indemnification and advancement of expenses provided
by, or granted pursuant to, this Article shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a director,
officer or employee and shall inure to the benefit of the heirs, executors and
administrators of such a person.
ARTICLE VII
CERTIFICATE OF STOCK
Section 1. Every holder of stock in the Corporation shall be entitled
to have a certificate, signed by, or in the name of the Corporation by, the
president or a vice-president and the treasurer or an assistant treasurer, or
the secretary or an assistant secretary of the Corporation, certifying the
number of shares owned by him in the Corporation.
-21-
Section 2. Any of or all the signatures on the certificate may be
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the Corporation with the same effect as if he were
such officer, transfer agent or registrar at the date of issue.
LOST CERTIFICATES
Section 3. The board of directors may direct a new certificate or
certificates to be issued in place of any certificate or certificates
theretofore issued by the Corporation alleged to have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming
the certificate of stock to be lost, stolen or destroyed. When authorizing such
issue of a new certificate or certificates, the board of directors may, in its
discretion and as a condition precedent to the issuance thereof, require the
owner of such lost, stolen or destroyed certificate or certificates, or his
legal representative, to advertise the same in such manner as it shall require
and/or to give the Corporation a bond in such sum as shall be sufficient to
indemnify the Corporation against any claim that may be made against the
Corporation with respect to the certificate alleged to have been lost, stolen or
destroyed.
-22-
TRANSFERS OF STOCK
Section 4. Upon surrender to the Corporation or the transfer agent of
the Corporation of a certificate for shares duly endorsed or accompanied by
proper evidence of succession, assignation or authority to transfer, it shall be
the duty of the Corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon its books.
FIXING RECORD DATE
Section 5. In order that the Corporation may determine the
stockholders entitled to notice of or to vote at any meeting of stockholders or
any adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock or for the purpose of any
other lawful action, the board of directors may fix, in advance, a record date,
which shall not be more than sixty nor less than ten days before the date of
such meetings, nor more than sixty days prior to any other action. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; provided,
however, that the board of directors may fix a new record date for the adjourned
meeting.
-23-
Section 6. In order that the Corporation may determine the
stockholders entitled to consent to corporate action in writing without a
meeting, the board of directors shall fix a record date, which record date shall
not precede the date upon which the resolution fixing the record is adopted by
the board of directors, and which date shall not be more than ten days after the
date upon which the resolution fixing the record date is adopted by the board of
directors.
Section 7. In order that the Corporation may determine the
stockholders entitled to receive payment of any dividend or other distribution
or allotment of any rights or the stockholders entitled to exercise any rights
in respect of any change, conversion or exchange of stock, or for the purpose of
any other lawful action, the board of directors shall fix a record date, which
record date shall not precede the date upon which the resolution fixing the
record date is adopted and which record date shall be more than sixty days prior
to such action.
REGISTERED STOCKHOLDERS
Section 8. The Corporation shall be entitled to recognize the
exclusive right of a person registered on its books as the owner of shares to
receive dividends, and to vote as such owner, and to hold liable for calls and
assessments a person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or other claim to or interest in such
share or shares on the part of any other
-24-
person, whether or not it shall have express or other notice thereof, except as
otherwise provided by the laws of Delaware.
ARTICLE VIII
GENERAL PROVISIONS
DIVIDENDS
Section 1. Dividends upon the capital stock of the Corporation,
subject to the provisions of the certificate of incorporation, if any, may be
declared by the board of directors at any regular or special meeting, pursuant
to law. Dividends may be paid in cash, in property, or in shares of the capital
stock, subject to the provisions of the certificate of incorporation.
Section 2. Before payment of any dividend, there may be set aside out
of any funds of the Corporation available for dividends such sum or sums as the
directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the Corporation, or for such other
purpose as the directors shall think conducive to the interest of the
Corporation, and the directors may modify or abolish any such reserve in the
manner in which it was created.
-25-
CHECKS
Section 3. All checks or demands for money and notes of the
Corporation shall be signed by such officer or officers or such other person or
persons as the board of directors may from time to time designate.
FISCAL YEAR
Section 4. The fiscal year of the Corporation shall end on July 31
unless otherwise fixed by resolution of the board of directors.
SEAL
Section 5. The corporate seal shall have inscribed thereon the name of
the Corporation, the year of its organization and the words "Corporate Seal,
Delaware". The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
BOOKS AND RECORDS
Section 6. Subject to any provisions contained in the statutes, the
books and records of the Corporation may be kept at such place or places either
within or
-26-
without the State of Delaware as shall be designated from time to time by the
board of directors.
ARTICLE IX
AMENDMENTS
Section 1. These by-laws may be altered, amended or repealed or new
by-laws may be adopted by the stockholders or by the board of directors, when
such power is conferred upon the board of directors by the certificate of
incorporation, at any regular meeting of the stockholders or of the board of
directors or at any special meeting of the stockholders or of the board of
directors if notice of such alteration, amendment, repeal or adoption of new
by-laws be contained in the notice of such special meeting. If the power to
adopt, amend or repeal by-laws is conferred upon the board of directors by the
certificate of incorporation it shall not divest or limit the power of the
stockholders to adopt, amend or repeal by-laws.
-27-
EMPLOYMENT AGREEMENT
AGREEMENT made as of this 1st day of February, 1994, by and between G-III
Apparel Group, Ltd., a Delaware corporation (the "Company"), with its principal
place of business at 345 West 37th Street, New York, New York 10018 and MORRIS
GOLDFARB (the "Executive"), who resides at 21 Fairway Drive, Mamaroneck, New
York 10543.
WHEREAS, the Company and the Executive are parties to an Employment
Agreement (the "Prior Agreement"), dated July 31, 1989, as amended July, 1992;
and
WHEREAS, the Board of Directors of the Company desires that the Executive
enter into this Agreement so that the Company may be assured of the services of
the Executive for the term of this Agreement and the Executive is desirous of
providing such services on the terms and conditions as provided for in this
Agreement, and
WHEREAS, it is the intention of the Company and the Executive that this
Agreement supersede the Prior Agreement, and that from and as of the date hereof
the Prior Agreement shall be cancelled and of no further force and effect.
NOW THEREFORE, in consideration of the foregoing, and the respective
covenants and agreements herein contained, the parties hereto agree as follows:
1. Duties. The Company shall employ the Executive, and the Executive shall
serve, as President and Chief Executive Officer of the Company during the
Employment Term (as hereinafter defined), and shall devote his full working time
toward the performance of such duties and responsibilities as provided for in
the Company's By-Laws, and such other duties and responsibilities as may from
time to time be prescribed by the Company's Board of Directors which are
consistent with his position as President and Chief Executive Officer of the
Company; provided, however, Executive may engage or participate in such other
activities incidental to any other employment, occupation or business venture or
enterprise which does not materially interfere with or compromise his ability to
perform his duties hereunder.
The Company shall use its best efforts to cause the Executive to be a
member of its Board of Directors throughout the Employment Term and shall
include him in the management slate for election as a director at every
stockholders' meeting at which his term as a director would otherwise expire.
The Board of Directors shall not amend its By-Laws or take any other action to
reduce the scope of the Executive's authority and responsibilities, unless he
shall otherwise consent, or except as otherwise provided in this Agreement.
During the Employment Term, the Executive shall not, directly or
indirectly, without the prior consent of a majority of the members of the
Company's Board of Directors, as owner, partner, joint venturer, shareholder,
employee, corporate officer or director, engage or become financially interested
in, be employed by, or render consulting services to any business in direct
competition with any business engaged in during the Employment Term by the
Company or its subsidiaries in any geographic area in North America where,
during the term of his employment, the business of the Company or any of its
subsidiaries is being conducted; provided; however, that the Executive may own
any securities of any corporation which is engaged in any such business and
which is publicly owned and traded but in an amount not to exceed at any one
time two percent of any class of stock or securities of such company.
2. Term. The term of this Agreement and of the term of employment (the
"Employment Term") of the Executive shall be from the date hereof until January
31, 1996, unless sooner terminated in accordance with the terms hereof.
Thereafter, this Agreement shall automatically be renewed for successive one
year terms, which shall extend the "Employment Term" of this Agreement, unless
either party shall give the other not less than ninety (90) days prior written
notice of its or his intent not to renew this Agreement beyond the Employment
Term as then in effect.
3. Base Compensation.
a. Salary. During the Employment Term, the Executive shall receive a
base salary at the rate of $650,000 per annum, subject to such increases as may
be approved by the Company's Board of Directors, payable in accordance with the
Company's normal payroll policy at the time in effect.
b. Nonexclusive. Compensation of the Executive by salary payments
shall not be deemed exclusive and shall not prevent the Executive from
participating in any other compensation or benefit plans of the Company.
c. Expenses. The Company acknowledges and agrees that the Executive,
in rendering services hereunder, will be required to spend sums of money for
travel to various locations throughout the world and for the entertainment of
various persons and representatives of companies and organizations with whom the
Company is having, or would like to have, business relationships. The Company
shall reimburse the Executive, upon presentation by the Executive of
documentation therefor, for any travel, entertainment or other business expenses
reasonably incurred by the Executive in rendering services hereunder on behalf
of the Company. The Executive shall be entitled to receive such reimbursement
within fifteen (15) days after he has delivered an itemized expense account
therefor to the Company. The parties hereto agree that the Executive shall be
entitled to stay in first-class hotel accommodations and to otherwise avail
himself of first-class travel and entertainment facilities in connection with
Executive's employment hereunder.
-2-
d. Automobile. The Company shall provide the Executive with an
automobile or shall reimburse the Executive for the cost thereof.
e. Disability. If during the Employment Term the Executive becomes
disabled or incapacitated to the extent that he is unable to perform his duties
hereunder (due to any physical or mental injury, illness or defect) for a period
of 180 consecutive days, then the Company shall thereafter pay to the Executive
fifty percent of the amount of the annual base salary provided for pursuant to
Section 3 hereof during the period of such disability or incapacity, in the same
manner set forth in said Section 3, for the balance of the Employment Term.
During such 180 day period, the Executive shall be entitled to receive his
annual base salary provided for in Section 3.
f. Life Insurance. The Executive shall be entitled to cause an
ordinary life insurance policy in the face amount of $2,000,000 to be issued by
an insurance company of the Executive's choice on the Executive's life naming
the Executive's wife as beneficiary. The Company shall reimburse the Executive
on demand for the cost of all premiums in connection with the maintenance of
said policy.
g. Health Insurance. The Company, at its sole cost and expense, shall
cause full health insurance coverage to be provided in favor of the Executive
during the Employment Term as the same is regularly provided for the Company's
senior executive employees, including, without limitation, major medical,
hospitalization and dental insurance. In lieu thereof, the Executive shall be
entitled to cause such insurance to be issued by an insurance company of the
Executive's choice in such amounts as the Executive shall determine, and the
Company shall reimburse the Executive on demand for the cost of all premiums in
connection with the maintenance of such policies.
h. Other Benefits. The Executive shall be entitled to participate in
and receive benefits under the Company's employee benefit plans and arrangements
in effect on the date hereof (in accordance with their respective terms) or to
participate in or receive benefits under those plans or arrangements of the
Company providing the Executive with at least equivalent benefits thereunder
(and giving credit for all plan purposes for service rendered by the Executive
to the Company and its subsidiaries). The Company shall not make any changes in
such plans or arrangements (including, if applicable, the funding through
insurance or otherwise of such plans or arrangements) that would adversely
affect the Executive's rights or benefits thereunder in a manner different from
the Company's other senior executives. The Executive shall be entitled to
participate in or receive benefits under any employee benefit plan or
arrangement made available by the Company in the future to its senior executives
and key management employees, subject to, and on a basis consistent with the
terms, conditions and overall administration of such plans and arrangements. Any
payments or benefits payable to the Executive hereunder in respect of any year
during which the Executive is employed by the Company for less than the entire
year shall, unless otherwise provided in the applicable plan or arrangement, be
prorated in accordance with the number of days in such year during which he is
so employed.
-3-
i. Vacations. The Executive shall be entitled to five (5) weeks of
paid vacations days in each calendar year, or such greater (but not lesser)
number of weeks as may be determined by the Board of Directors from time to time
during the term hereof. The Executive shall also be entitled to all paid
holidays given by the Company to its senior executives.
j. Supplemental Pension. For each full year of the Executive's
employment hereunder in which the Company's Net After-Tax Income (hereinafter
defined) exceeds $1,500,000, the Company will credit at least $50,000 to a
bookkeeping account established in the name of the Executive. The term "Net
After-Tax Income" as used in this Agreement shall mean the net after tax income
of the Company and its subsidiaries, as reported in the consolidated financial
statements of the Company prepared by the Company's independent public
accountants; provided, however, that Net After-Tax Income shall be determined
without regard to any extraordinary item, as such term is used in generally
accepted accounting principles. The amount credited to the Executive's
bookkeeping account, together with investment gain or loss thereon (on a basis
to be determined) will be payable to the Executive by the Company as soon as
practicable after the Executive's termination of employment with the Company and
its subsidiaries; provided, however, that no such amount will be payable if the
Executive's employment is terminated by the Company for "cause" (as such term is
defined in Section 6(a) hereof) or if the Executive's employment terminates for
any reason other than death or disability within one year from the date hereof.
The Company shall establish a grantor trust and shall contribute to said trust
the principal amount of each year's deferred compensation credit. The assets of
the trust will be applied to satisfy the Company's obligations to the Executive
under this section 3(j), it being understood, however, that the assets of the
trust will be subject to the claims of the Company's creditors in the event of
the Company's prior bankruptcy. It is contemplated that the Company's Board of
Directors will adopt a supplemental executive retirement plan and that the
deferred compensation agreement set forth in this section 3(j) will be subject
to the terms and provisions of said plan to the extent that such terms and
provisions are not inconsistent with the terms and provisions hereof.
k. Option Grant. Subject to the approval by the stockholders of the
Company of amendments to the Company's 1989 Stock Option Plan (the "Plan") at
the 1994 Annual Meeting of Stockholders, the Company will grant to the Executive
an option under the Plan, which shall not be an Incentive Stock Option (as
defined in the Plan), to purchase 100,000 shares of the Company's Common Stock,
$.01 par value (the "Common Stock"), at a per share exercise price equal to
$4.00, the closing price of the Common Stock on the Nasdaq National Market on
the date of this Agreement. Such stock option shall vest over a five-year period
as follows: 20% on January 31, 1995; 20% on January 31, 1996; 20% on January 31,
1997; 20% on January 31, 1998; and 20% on January 31, 1999. The foregoing, as
well as such other terms and conditions as the Company shall deem appropriate,
shall be set forth in a definitive stock option agreement to be entered into by
the Company and the Executive. The Executive's rights as an optionee shall be
governed by the terms and conditions of such agreement and the Plan.
-4-
1. Services Furnished. The Company shall furnish the Executive with
office space, secretarial and stenographic assistance and such other facilities
and services as shall be suitable to the Executive's position and adequate for
the performance of his duties as set forth in Section 1 hereof.
4. Bonus.
a. Bonus from Pre-Tax Income. The Executive shall be entitled to
receive, as additional compensation, an annual cash bonus equal to the
percentage of the Company's Pre-Tax Income (as hereinafter defined) in excess of
$2,000,000 with respect to each fiscal year of the Company during the Employment
Term, as follows:
Percentage of Pre-Tax Income in Excess
If Pre-Tax Income is: of $2,000,000 to be paid to Executive is:
- ------------------------ -----------------------------------------
under $2,000,000 -0-
$2,000,000 to $3,000,000 3%
$3,000,001 to $4,000,000 4%
$4,000,001 or more 6%
b. Pre-Tax Income Defined. The term "Pre-Tax Income" as used in this
Agreement shall mean the net income of the Company and its subsidiaries, as
reported in the consolidated financial statements of the Company prepared by the
Company's independent public accountants, plus the sum of (i) the income taxes
set forth in such financial statements and (ii) the amount of the bonus payable
pursuant to Section 4(a) hereof; provided, however, that Pre-Tax Income shall be
determined without regard to any extraordinary item, as such term is used in
generally accepted accounting principles.
c. Payment. An estimated amount of this additional bonus compensation
shall be determined by the Company's Compensation Committee no later than 45
days following the last day of the fiscal year to which such additional bonus
compensation relates. Payment of fifty percent of such estimated amount shall be
made within 60 days following the last day of the fiscal year to which such
additional bonus relates. The amount of the additional bonus compensation shall
be determined by the Company's Compensation Committee no later than 90 days
following the last day of the fiscal year to which such additional bonus
compensation relates. Payment of the difference between the amount so determined
and the partial estimated payment shall be made no later than 120 days following
the last day of the fiscal year to which such additional bonus compensation
relates. Payment shall be made irrespective of the Executive's then current
employment status with the Company. With respect to any fiscal year of the
Company during which the Executive's employment terminates, the Executive shall
be entitled to a pro rata share of additional bonus compensation based upon a
pro rata share calculated as a fraction based upon the number of days
-5-
which the Executive has been employed by the Company in such fiscal year divided
by the entire number of days in such fiscal year.
5. Place of Performance. In connection with his employment by the Company,
the Executive shall be based at the principal executive offices of the Company
which shall be located in the New York City metropolitan area, except for travel
required for Company business to an extent substantially consistent with the
Executive's present business travel obligations on behalf of the Company and its
subsidiaries.
6. Termination.
a. Termination for Cause by the Company. The Company may terminate
this Agreement and all of the Company's obligations hereunder for "cause".
Termination by the Company for "cause" shall mean termination by action of a
majority of the members of the Company's Board of Directors because of the
Executive's conviction of a felony (which, through lapse of time or otherwise,
is not subject to appeal) or willful refusal without proper cause to perform
his obligations under this Agreement or because of the Executive's material
breach of any of the covenants provided for in Section 8 hereof. Such
termination shall be effected by written notice thereof by the Company to the
Executive, and, except as hereinafter provided, shall be effective as of the
date of such notice; provided, however, that such termination shall not be
effective if (i) such termination is because of the Executive's willful refusal
without proper cause to perform any one or more of his obligations under this
Agreement, (ii) such notice is the first such notice of termination for any
reason delivered by the Company to the Executive hereunder, and (iii) within 7
days following the date of such notice the Executive shall cease his refusal and
shall use his best efforts to perform such obligations.
The Executive may, within 15 days following delivery of the notice of
termination referred to in the preceding paragraph, by written notice to the
Board of Directors of the Company, cause the matter of the termination of this
Agreement to be discussed at the next regularly scheduled meeting of the Board
of Directors or at a special meeting of the Board of Directors held in
accordance with the Company's By-Laws. The Executive shall be entitled to be
represented by counsel at such meeting which shall be conducted according to a
procedure deemed equitable by a majority of the Directors present. If, at such
meeting, it shall be determined by a majority of the Directors that this
Agreement had been terminated without proper cause, the provisions of this
Agreement shall be reinstated with the same force and effect as if the notice of
the termination had not been given. The Executive shall be entitled to receive
the compensation and other benefits provided herein for the period from the date
of the delivery of the notice of termination through the date of such Board
meeting. Nothing herein contained shall limit or deny the Executive's right to
have any such dispute resolved pursuant to arbitration as set forth in Section
15 hereof.
b. Termination for Cause by the Executive. The Executive shall have
the right to terminate this Agreement and all of the Executive's obligations
hereunder for "cause". Termination
-6-
by the Executive for "cause" shall mean termination because of a material breach
by the Company of any of its obligations hereunder.
c. Executive's Remedies. In the event the Company terminates this
Agreement without cause (as defined in Section 6(a) hereof), or in the event the
Executive terminates this Agreement for cause (as defined in Section 6(b)
hereof), the parties hereto agree that damages to the Executive shall be
difficult to ascertain in any such event, but in order to limit the liability of
the Company the Executive shall be entitled to receive as liquidated damages and
not as a penalty in any such event the following: (i) the entire amount of the
base salary of the Executive remaining due and payable from any such date of
termination to the expiration date of this Agreement as provided hereunder,
which entire amount shall be accelerated and immediately due and payable upon
any such termination, plus (ii) the entire amount of the Executive's bonus from
Pre-Tax Income as calculated according to the terms and conditions of Section 4
of this Agreement which shall be due and payable within ninety (90) days of the
end of each of the Company's fiscal years commencing on or prior to the
expiration date of this Agreement as provided hereunder plus (iii) all other
benefits accruing to the Executive on or prior to the expiration date of this
Agreement as provided hereunder.
d. Mitigation. In the event of the termination of this Agreement by
the Executive as a result of a material breach by the Company of any of its
obligations hereunder, or in the event of the termination of the Executive's
employment by the Company without cause (as defined in Section 6(a) hereof) or
in breach of this Agreement, it is expressly understood that the Executive shall
not be required to seek other employment in order to mitigate his damages
hereunder.
e. Legal Costs. In the event that the Executive institutes any legal
action to enforce his rights, or to recover damages for breach of the Company's
obligations, under this Agreement and this Section 6, the Executive in such an
action shall be entitled to recover from the Company all costs and expenses
(including, without limitation, attorneys' fees and disbursements) incurred by
him if he prevails in any such action or if any such action is settled in his
favor.
f. Change In Control. Notwithstanding anything to the contrary
contained in Section 6(c) hereof, and in lieu of any payments required to be
made pursuant to said Section 6(c), in the event (i) the Company shall terminate
this Agreement without cause (as defined in Section 6(a) hereof) or (ii) the
Executive shall terminate this Agreement for cause (as defined in Section 6(b)
hereof), in either case at any time after the occurrence of a Change In Control
(as defined below) of the Company, the Company shall pay to the Executive, in a
lump sum in cash within 30 days after such termination date, an amount equal to
(i) 2.99 times the Executive's "annualized includable compensation for the base
period," as defined in section 280G of the Internal Revenue Code of 1986 (the
"Code"), or any successor provision (which term includes, without limitation,
Executive's base salary and bonus). In addition, for a period of three years
from such termination date, the Company shall continue to provide all other
benefits to the Executive at least equal to those which would have been provided
to the Executive had the Executive's employment not been so terminated, or, if
more favorable to the Executive, those benefits generally in effect at any time
thereafter with respect to
-7-
similar executive officers of the Company (or its successor, if applicable).
Furthermore, for purposes of determining eligibility of the Executive for
retiree benefits pursuant to any plan, program or policy maintained by the
Company, the Executive shall be considered to have remained employed until the
end of such three year period and to have retired on the last day of such
period; provided, however, that to the extent it is not possible under any such
plan, program or policy to characterize such three year period as employment
service, the Company agrees to provide the Executive with such substantially
equivalent benefit as would give the Executive the same substantial benefit he
would have received if such characterization was possible and given effect.
Notwithstanding anything to the contrary contained in this Section 6(f), no
payment to or for the benefit of the Executive shall be made pursuant to this
Section 6(f) in excess of amounts for which, in the sole opinion of the
Company's certified independent public accountants, the Company is allowed to
claim a deduction for Federal income tax purposes by reason of section 280G of
the Code, or any successor provision.
As used in this Section 6(f), a Change In Control shall be deemed to
occur if (i) there shall be consummated (x) any consolidation or merger of the
Company in which the Company is not the continuing or surviving corporation or
pursuant to which shares of the Company's Common Stock would be converted into
cash, securities or other property, other than a merger of the Company in which
the holders of the Company's Common Stock immediately prior to the merger have
the same proportionate ownership of common stock of the surviving corporation
immediately after the merger, or (y) any sale, lease, exchange or other transfer
(in one transaction or a series of related transactions) of all, or
substantially all, the assets of the Company, or (ii) the stockholders of the
Company shall approve any plan or proposal for liquidation or dissolution of the
Company, or (iii) any person (as such term is used in Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), other than a person who on the date hereof is the beneficial owner
(within the meaning of Rule 13d-3 under the Exchange Act) of 10% or more of the
Company's outstanding Common Stock, shall become the beneficial owner of 35% or
more of the Company's then outstanding Common Stock other than pursuant to a
plan or arrangement entered into by such person and the Company, or (iv) during
any period of two consecutive years, individuals who at the beginning of such
period constitute the entire Board of Directors shall cease for any reason to
constitute a majority thereof unless the election, or the nomination for
election by the Company's stockholders, of each new director was approved by a
vote of at least two-thirds of the directors then still in office who were
directors at the beginning of the period.
7. Death. If the Executive shall die during the term of this Agreement,
this Agreement and all benefits hereunder shall terminate except that (i) if
death occurs during the term of this Agreement, the Executive's estate shall be
entitled to receive the base salary provided in Section 3 hereof for a period of
six months from the last day of the month in which his death occurs and shall be
eligible to receive bonus compensation under Section 4 hereof prorated according
to the number of days of employment in such fiscal year, and (ii) such
termination shall not affect any vested rights which the Executive may have at
the time of his death pursuant to any insurance or other death
-8-
benefit plans or arrangements of the Company or any subsidiary, which rights
shall continue to be governed by the provisions of such plans and agreements.
8. Protection of Confidential Information. The Executive acknowledges that
his employment by the Company (which for all purposes of this Agreement shall
include the Company's subsidiaries) will, throughout the term of this Agreement,
bring him in contact with many confidential affairs of the Company not readily
available to the public, and plans for future developments. In recognition of
the foregoing, the Executive covenants and agrees that he will not intentionally
disclose to anyone outside of the Company any material confidential matters of
the Company which are not otherwise in the public domain, either during or for a
period of one year after the expiration of the term of his employment except
with the Company's written consent or as required by court order, law or
subpoena or other legal compulsion to disclose.
9. Successors; Binding Agreement. This Agreement and all rights of the
Executive hereunder shall insure to the benefit of, and shall be enforceable by,
the Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the Executive should
die while any amount would still be payable to him hereunder if he had continued
to live, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to the Executive's devisee, legatee
or other designee or, if there be no such designee, to the Executive's estate.
10. Notice. For the purposes of this Agreement, notices, demands and all
other communications provided for in the Agreement shall be in writing and shall
be deemed to have been duly given when delivered against receipt therefor or
mailed by United States certified mail, return receipt requested, postage
prepaid, addressed as follows:
If to the Executive: Morris Goldfarb
21 Fairway Drive
Mamaroneck, New York 10543
If to the Company: G-III Apparel Group, Ltd.
345 West 37th Street
New York, New York 10018
Attention: Chief Financial Officer
With a copy, in Neil Gold, Esq.
either case, to: Fulbright & Jawoski L.L.P.
666 Fifth Avenue
New York, New York 10103
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notice of change of address shall be
effective only upon receipt.
-9-
11. Miscellaneous. No provisions of this Agreement may be modified, waived,
or discharged unless such waiver, modification or discharge is agreed to in
writing and signed by the Executive and such officers of the Company as may be
specifically designated by its Board of Directors. No waiver by either party
hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws of
the State of New York for agreements executed and performed in said State
without regard to its conflict of laws principles.
12. Validity. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.
13. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
14. Entire Agreement. This Agreement sets forth the entire agreement and
understanding of the parties hereto in respect of the subject matter contained
herein, and supersedes all prior agreements (including the Prior Agreement),
promises, covenants, arrangements, communications, representations or
warranties, whether oral or written, by any officer, employee or representative
of any party hereto.
15. Arbitration. Should any disagreement, dispute, conflict, claim or
controversy arise between any of the parties hereto with respect to this
Agreement or any of the provisions thereof, or as to the interpretation or
effect thereof, or as to a breach thereof claimed to have been committed by any
party, or as to any other matter, cause or thing whatsoever relating to this
Agreement, and should said dispute or controversy fail to be amicably resolved
by mutual agreement of the parties concerned therein, then the same shall be
submitted to and determined by arbitration in the City of New York in the State
of New York before and by the American Arbitration Association, in accordance
with the rules and regulations of said arbitration tribunal then applicable and
in full force and effect. Judgment upon the award or decision rendered by said
arbitration tribunal as aforesaid may be entered in any court or forum, Federal
or state, having jurisdiction thereof, and shall have the effect for all
purposes of a judgment of said court or forum with respect to the parties and
subject matter therein concerned.
16. Excise Taxes. If the Executive incurs an excise tax liability under
Section 4999 of the Internal Revenue Code of 1986 in respect of any payment made
under this Agreement or under any other agreement relating to Executive's
employment by the Company, then the Company shall pay additional compensation to
the Executive at such time or times and in such amount or amounts as
-10-
shall be sufficient to reimburse the Executive and make him whole on an
after-tax basis for the satisfaction of such excise tax liability.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first-above written.
G-III APPAREL GROUP, LTD.
By: /s/ Alan Feller
------------------------------------
/s/ Morris Goldfarb
------------------------------------
Morris Goldfarb
-11-
G-III APPAREL GROUP, LTD.
512 Seventh Avenue
New York, NY 10018
212.403.0500
212.403.0551 Fax
October 1, 1999
Mr. Morris Goldfarb
21 Fairway Drive
Mamaroneck, New York 10543
Dear Mr. Goldfarb:
This letter, when accepted by you, shall constitute an amendment to the
Employment Agreement (the "Agreement"), dated February 1, 1994, between G-III
Apparel Group, Ltd. (the "Company") and you.
The Company and you hereby agree that Section 2 of the Agreement shall be
amended to read as follows:
2. Term. The term of this Agreement and of the term of employment (the
"Employment Term") shall terminate on January 31, 2003; provided, however, that
on each January 31st which shall be two years prior to the end of the then
Employment Term, the term of this Agreement and the Employment Term shall be
automatically extended for an additional one-year period unless prior to such
January 31st either party shall have given written notice to the other that the
term of this Agreement and the Employment Term shall not be extended any
further.
Except as modified herein, all terms and provisions of the Agreement
continue in full force and effect.
Very truly yours,
G-III APPAREL GROUP, LTD.
By: /s/ Wayne S. Miller
------------------------------------
Accepted and agreed to:
/s/ Morris Goldfarb
- -------------------------------------
Morris Goldfarb
[GLOBAL IDENTITY APPAREL GROUP LOGO]
- --------------------------------------------------------------------------------
HARTZ MOUNTAIN ASSOCIATES
Landlord,
and
Tenant
G-III LEATHER FASHIONS, INC.
LEASE
----------
Premises:
in
1000 Secaucus Road,
Secaucus, New Jersey 07094
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
ARTICLES PAGE
- -------- ----
1 - DEFINITIONS .................................................. 1
2 - DEMISE AND TERM .............................................. 6
3 - RENT ......................................................... 6
4 - USE OF DEMISED PREMISES ...................................... 8
5 - PREPARATION OF DEMISED PREMISES .............................. 9
6 - TAX AND OPERATING EXPENSE PAYMENTS ........................... 9
7 - COMMON AREAS ................................................. 10
8 - SECURITY ..................................................... 11
9 - SUBORDINATION ................................................ 13
10 - QUIET ENJOYMENT .............................................. 14
11 - ASSIGNMENT, SUBLETTING AND MORTGAGING ........................ 14
12 - COMPLIANCE WITH LAWS ......................................... 17
13 - INSURANCE AND INDEMNITY ...................................... 18
14 - RULES AND REGULATIONS ........................................ 21
15 - ALTERATIONS AND SIGNS ........................................ 22
16 - LANDLORD'S AND TENANT'S PROPERTY ............................. 23
17 - REPAIRS AND MAINTENANCE ...................................... 24
18 - UTILITY CHARGES .............................................. 25
19 - ACCESS, CHANGES AND NAME ..................................... 26
20 - MECHANICS' LIENS AND OTHER LIENS ............................. 26
21 - NON-LIABILITY AND INDEMNIFICATION ............................ 27
22 - DAMAGE OR DESTRUCTION ........................................ 28
23 - EMINENT DOMAIN ............................................... 30
24 - SURRENDER .................................................... 31
25 - CONDITIONS OF LIMITATION ..................................... 31
26 - RE-ENTRY BY LANDLORD ......................................... 32
27 - DAMAGES ...................................................... 33
28 - AFFIRMATIVE WAIVERS .......................................... 36
29 - NO WAIVERS ................................................... 36
30 - CURING TENANT'S DEFAULTS ..................................... 36
31 - BROKER ....................................................... 37
32 - NOTICES ...................................................... 37
33 - ESTOPPEL CERTIFICATES ........................................ 38
34 - ARBITRATION .................................................. 38
35 - MEMORANDUM OF LEASE .......................................... 39
36 - MISCELLANEOUS ................................................ 39
EXHIBITS
Exhibit A - Demised Premises
Exhibit B - Description of Land
Exhibit C - Workletter
Exhibit D - Rules and Regulations
Exhibit E - Form of Non-Disturbance Agreement
Exhibit F - Approved List of Contractors
092193
091593
090993
LEASE, dated September 21st, 1993, between HARTZ MOUNTAIN ASSOCIATES, a New
Jersey general partnership, having an office at 400 Plaza Drive, Secaucus, New
Jersey 07094-3688 ("Landlord"), and G-III LEATHER FASHIONS INC., a New York
corporation, having an office at 345 W. 37th Street, New York, New York 10018
("Tenant").
ARTICLE 1 - DEFINITIONS
1.01. As used in this Lease (including all Exhibits and any Riders attached
hereto, all of which shall be deemed to be part of this Lease) the following
words and phrases shall have the meanings indicated:
A. Advance Rent: $40,194.75.
B. Additional Charges: All amounts that become payable by Tenant to
Landlord hereunder other than the Fixed Rent and Percentage Rent.
C. Architect: Kenneth Carl Bonte, or as Landlord may designate.
D. Broker: Chaus-Corpuel.
E. Building: The building or buildings located on the Land and known as
1000 Secaucus Road, Secaucus, New Jersey 07094.
F. Building Fraction: A fraction the numerator of which is the Floor Space
of the Building (approximately 202,040 square feet) and the denominator of which
is the aggregate Floor Space of the buildings in the Development. If the
aggregate Floor Space of the buildings in the Development shall be changed due
to any construction or alteration, the denominator of the Building Fraction
shall be increased or decreased to reflect such change.
Fl. Calendar Quarter: Any three-month period commencing on either a January
1, an April 1, a July 1 or an October 1.
G. Calendar Year: Any twelve-month period commencing on a January 1.
H. Commencement Date: The earlier of (a) the date on which both: (i) the
Demised Premises shall be Ready for Occupancy, and (ii) actual possession of the
Demised Premises shall have been delivered to Tenant by notice to Tenant, or (b)
the date Tenant, or anyone claiming under or through Tenant, first occupies the
Demised Premises or any part thereof for any purpose other than the performance
of Tenant's Work.
I. Common Areas: All areas, spaces and improvements in the Building and on
the Land which Landlord makes available from time to time for the common use and
benefit of the tenants and occupants of the Building and which are not
exclusively available for use by a single tenant or occupant, including, without
limitation, parking areas, roads, walkways, sidewalks,
landscaped and planted areas, community rooms, if any, the managing agent's
office, if any, and public rest rooms, if any.
J. Demised Premises: The space that is outlined in red on the floor
plans(s) attached hereto as Exhibit A. The Demised Premises contains or will
contain approximately 107,186 square feet of Floor Space subject to adjustment
upon verification by the Architect.
K. Development: All land and improvements now existing or hereafter
constructed, located south of Route 3, east of the Hackensack River, west of
County Avenue and north of Castle Road.
L. Development Common Areas: The roads and bridges that from time to time
service and provide access to the Development for the common use of the tenants,
invitees, and occupants of the Development, that are maintained by Landlord or
its related entities.
M. Expiration Date: February 28, 2000. However, if the Term is extended by
Tenant's effective exercise of Tenant's right, if any, to extend the Term, the
"Expiration Date" shall be changed to the last day of the latest extended period
as to which Tenant shall have effectively exercised its right to extend the
Term. For the purposes of this definition, the earlier termination of this Lease
shall not affect the "Expiration Date."
N. Fixed Rent: An amount at the annual rate of four and 50/100 Dollars
($4.50) per square foot multiplied by the Floor Space of the Demised Premises.
0. Floor Space: As to the Demised Premises, the sum of the floor area
stated in square feet bounded by the exterior faces of the exterior walls, or by
the exterior or Common Area face of any wall between the Demised Premises and
any portion of the Common Areas, or by the center line of any wall between the
Demised Premises and space leased or available to be leased to a tenant or
occupant.
01. Gross Sales: The dollar aggregate of: (a) the actual sales price of all
goods and merchandise sold, leased or licensed and the charges for all services
performed by Tenant or otherwise in connection with all business conducted at or
from the Retail Premises, whether made for cash, by check, credit or otherwise,
without reserve or deduction for inability or failure to collect the same,
including, without limitation, sales and services (i) where the orders therefor
originate at or are accepted at or from the Retail Premises, whether delivery or
performance thereof is made at or from the Retail Premises or any other place,
it being understood that all sales made and orders received at or from the
Retail Premises shall be deemed to have been made and completed therein even
though the orders are fulfilled elsewhere or the payments of account are
transferred to some other office for collection, (ii) where the orders therefor
result from solicitation off the Retail Premises but which are conducted by
personnel operating from or reporting to or under the control or supervision of
any employee at the Retail Premises, (iii) pursuant to mail, telegraph,
telephone or other similar orders received or billed at or from the Retail
Premises, and (iv) by means of mechanical or other vending devices, and (b) all
monies or other things of
2
value received by Tenant from its operations at the Retail Premises (which are
not excluded from Gross Sales by the next succeeding sentence) including all
finance charges, cost of gift or merchandise certificates and all deposits not
refunded to customers. Gross Sales shall not include (x) the exchange of
merchandise between stores of Tenant where such exchange is made solely for the
convenient operation of Tenant's business and neither for the purpose of
depriving Landlord of the benefits of a sale which would otherwise be made at or
from the Retail Premises nor for the purpose of consummating a sale which has
been theretofore made at or from the Retail Premises, (y) sales of trade
fixtures which are not part of Tenant's stock in trade and not sold in the
regular course of Tenant's business, or (z) the amount of any city, county,
state or federal sales tax, luxury tax or excise tax on sales if the tax is
added to the selling price and separately stated and actually paid to the taxing
authority by Tenant; provided, however, no franchise or capital stock tax and no
income or similar tax based upon income, profits or Gross Sales shall be
deducted from Gross Sales in any event whatsoever. Cash or credit refunds made
upon transactions included within the Gross Sales, but not exceeding the selling
price of merchandise returned by the purchaser and accepted by Tenant, shall be
deducted from the Gross Sales for the period when such refunds are made. Each
charge or sale upon installment or credit or layaway, so called, shall be
treated as a sale for the full price in the month during which such charge or
sale shall be made, irrespective of the time when Tenant shall receive payment
from its customer. Each lease or rental or license of merchandise to customers
shall be treated as a sale in the month in which the lease, rental or license is
made for a price equal to the total rent or license fee payable. For purposes of
this paragraph the word "Tenant" shall include any of Tenant's subtenants,
concessionaires and licensees.
P. Guarantor: G-III Apparel Group Ltd. Guarantor has executed and delivered
to Landlord a Guaranty Agreement simultaneously herewith.
Q. Insurance Requirements: Rules, regulations, orders and other
requirements of the applicable board of underwriters and/or the applicable fire
insurance rating organization and/or any other similar body performing the same
or similar functions and having jurisdiction over the Land and Building, whether
now or hereafter in force.
R. Land: The Land upon which the Building and Common Areas are located. The
Land is described on Exhibit B.
S. Landlord's Work: The materials and work to be furnished, installed and
performed by Landlord at its expense in accordance with the provisions of
Exhibit C.
T. Legal Requirements: Laws and ordinances of all federal, state, city,
town, county, borough and village governments, and rules, regulations, orders
and directives of all departments, subdivisions, bureaus, agencies or offices
thereof, and of any other governmental, public or quasi-public authorities
having jurisdiction over the Land and Building, whether now or hereafter in
force, including, but not limited to, those pertaining to environmental matters.
3
U. Mortgage: A mortgage and/or a deed of trust.
V. Mortgagee: A holder of a mortgage or a beneficiary of a deed of trust.
W. Operating Expenses: The sum of the following: (1) the cost and expense
(whether or not within the contemplation of the parties) for the repair,
replacement, maintenance, policing, insurance and operation of the Building and
Land, and (2) the Building Fraction of the sum of (a) the cost and expense for
the repair, replacement, maintenance, policing, insurance and operation of the
Development Common Areas; (b) the Real Estate Taxes, if any, attributable to the
Development Common Areas; The "Operating Expenses" shall, include, without
limitation, the following: (i) the cost for rent, casualty, liability, boiler
and fidelity insurance, (ii) if an independent managing agent is employed by
Landlord, the fees payable to such agent (provided the same are competitive with
the fees payable to independent managing agents of comparable facilities in
Hudson County), and (iii) reasonable legal, accounting and other professional
fees. Operating Expenses shall specifically exclude the following: (i)
depreciation; (ii) debt service on any Superior Mortgage; (iii) leasehold
improvements specifically attributable to tenants other than the Tenant; (iv)
brokerage commissions; (v) sale or refinancing costs; (vi) attorneys fees and
other costs and expenses incurred in negotiations with prospective tenants,
disputes with other tenants or eviction proceedings against other tenants; (vii)
penalties or interest due to Landlord's violations of any Legal Requirement;
(viii) costs for which Landlord actually receives compensation from insurance
proceeds. All items included in Operating Expenses shall be determined in
accordance with generally accepted accounting principles consistently applied.
Wl. Percentage Rent: The amount for any period computed in accordance with
the provisions of Section 3.02.
W2. Percentage Rent Break Point Amount: An amount equal to the product of
(a) the total square footage of the Retail Premises and (b) Three Hundred Fifty
and 00/100 Dollars ($350.00).
W3. Percentage Rent Rate: 5%.
X. Permitted Uses: Warehousing and distribution of leather and other
wearing apparel and accessories, and the sewing, pressing and assembly of such
garments. Tenant shall also be permitted to utilize not more than 8,490 square
feet of Floor Space of the Demised Premises for retail purposes subject to
applicable zoning requirements.
Y. Person: A natural person or persons, a partnership, a corporation, or
any other form of business or legal association or entity.
Z. Ready for Occupancy: The condition of the Demised Premises when for the
first time the Landlord's Work shall have been substantially completed and, if
same is required to be obtained by Landlord, a temporary, permanent, or
continuing Certificate of Occupancy shall have been issued permitting use of the
Demised Premises for the Permitted Uses. The Landlord's Work shall be
4
deemed substantially completed notwithstanding the fact that minor or
insubstantial details of construction, mechanical adjustment or decoration
remain to be performed, the noncompletion of which does not materially interfere
with Tenant's use of the Demised Premises.
AA. Real Estate Taxes: The real estate taxes, assessments and special
assessments imposed upon the Building and Land by any federal, state, municipal
or other governments or governmental bodies or authorities, and any expenses
incurred by Landlord in contesting such taxes or assessments and/or the assessed
value of the Building and Land, which expenses shall be allocated to the period
of time to which such expenses relate. If at any time during the Term the
methods of taxation prevailing on the date hereof shall be altered so that in
lieu of, or as an addition to or as a substitute for, the whole or any part of
such real estate taxes, assessments and special assessments now imposed on real
estate there shall be levied, assessed or imposed (a) a tax, assessment, levy,
imposition, license fee or charge wholly or partially as a capital levy or
otherwise on the rents received therefrom, or (b) any other such additional or
substitute tax, assessment, levy, imposition or charge, then all such taxes,
assessments, levies, impositions, fees or charges or the part thereof so
measured or based shall be deemed to be included within the term "Real Estate
Taxes" for the purposes hereof.
BB. Rent: The Fixed Rent, the Percentage Rent and the Additional Charges.
BB1. Retail Premises: That area within the Demised Premises from which
Tenant sells goods on a retail basis, including dressing/fitting rooms, related
storage areas, and any other area within the Demised Premises directly related
to the sale of such goods.
CC. Rules and Regulations: The rules and regulations that may be
promulgated by Landlord from time to time. The Rules and Regulations now in
effect are attached hereto as Exhibit D.
DD. Security Deposit: $80,389.50 (if in the form of a Letter of Credit);
$60,297.13 (if in the form of cash).
EE. Successor Landlord: As defined in Section 9.03.
FF. Superior Lease: Any lease to which this Lease is, at the time referred
to, subject and subordinate.
GG. Superior Lessor: The lessor of a Superior Lease or its successor in
interest, at the time referred to.
HH. Superior Mortgage: Any Mortgage to which this Lease is, at the time
referred to, subject and subordinate.
II. Superior Mortgagee: The Mortgagee of a Superior Mortgage at the time
referred to.
5
JJ. Tenant's Fraction: 53.06%. If the size of the Demised Premises or the
Building shall be changed from the initial size thereof, due to any taking, any
construction or alteration work or otherwise, the Tenant's Fraction shall be
changed to the fraction the numerator of which shall be the Floor Space of the
Demised Premises and the denominator of which shall be the Floor Space of the
Building.
KK. Tenant's Property: As defined in Section 16.02.
LL. Tenant's Work: The facilities, materials and work which may be
undertaken by or for the account of Tenant (other than the Landlord's Work) to
equip, decorate and furnish the Demised Premises for Tenant's occupancy in
accordance with the provisions of Exhibit C.
MM. Term: The period commencing on the Commencement Date and ending at
11:59 p.m. of the Expiration Date, but in any event the Term shall end on the
date when this Lease is earlier terminated.
NN. Unavoidable Delays: A delay arising from or as a result of a strike,
lockout, or labor difficulty, explosion, sabotage, accident, riot or civil
commotion, act of war, fire or other catastrophe, Legal Requirement or an act of
the other party and any cause beyond the reasonable control of that party,
provided that the party asserting such Unavoidable Delay has exercised its best
efforts to minimize such delay.
ARTICLE 2 - DEMISE AND TERM
2.01. Landlord hereby leases to Tenant, and Tenant hereby hires from
Landlord, the Demised Premises, for the Term. This Lease is subject to (a) any
and all existing encumbrances, conditions, rights, covenants, easements,
restrictions and rights of way, of record, and other matters of record,
applicable zoning and building laws, regulations and codes, and such matters as
may be disclosed by an inspection or survey, and (b) easements now or hereafter
created by Landlord in, under, over, across and upon a strip of land twenty feet
(20') in width running along all lot lines of the Land for sewer, water,
electric, gas and other utility lines and services now or hereafter installed;
provided, however, Landlord represents, covenants and warrants to Tenant that
(i) the Demised Premises may be used and occupied for the purposes set forth
herein; (ii) Tenant shall have adequate means of ingress and egress to the
Demised Premises for such uses; and (iii) the foregoing shall in no manner
interfere with Tenant's use and quiet enjoyment of the Demised Premises during
the Term. Promptly following the Commencement Date, the parties hereto shall
enter into an agreement in form and substance satisfactory to Landlord setting
forth the Commencement Date.
ARTICLE 3 - RENT
3.01. Tenant shall pay the Fixed Rent in equal monthly installments in
advance on the first day of each and every calendar month during the Term
(except that Tenant shall pay, upon the execution and delivery of this Lease by
Tenant, the Advance Rent, to be applied against the first installment or
6
installments of Fixed Rent becoming due under this Lease). If the Commencement
Date occurs on a day other than the first day of a calendar month, the Fixed
Rent for the partial calendar month at the commencement of the Term shall be
prorated.
3.02. Within fifteen (15) days after the end of each calendar month during
the Term, Tenant shall submit to Landlord a statement certified by Tenant (by an
authorized officer if Tenant is a corporation or by a partner if Tenant is a
partnership) stating the Gross Sales (including an itemization of all claimed
deductions therefrom) for such month. Within fifteen (15) days after the end of
each Calendar Quarter, Tenant shall pay to Landlord as Percentage Rent the
product of [(a) the amount, if any, by which the aggregate Gross Sales for the
Calendar Year in which such Calendar Quarter occurs up to the end of such
Calendar Quarter exceeds the Percentage Rent Break Point Amount and (b) the
Percentage Rent Rate] less (c) the amount theretofore paid as Percentage Rent
for the Calendar Year in which such Calendar Quarter occurs. Within ninety (90)
days after the end of each Calendar year, including any partial Calendar Year at
the beginning of the Term, and after the end of the Term, Tenant shall submit to
Landlord a statement certified by an independent certified public accountant
stating the Gross Sales (including an itemization of all claimed deductions
therefrom) and the Percentage Rent for such Calendar Year, or partial Calendar
Year if the Term shall begin on a date other than a January 1st and/or end on a
date other than a December 31st, as the case may be, and if the Percentage Rent
so stated for such period is more or less than the Percentage Rent paid for such
period, Tenant shall pay to Landlord the deficiency, or Landlord shall refund to
Tenant the excess, within twenty (20) days after submission of such statement of
Gross Sales. For at least thirty-six (36) months after the expiration of each
Calendar Year, including any partial Calendar Year at the beginning of the Term,
and after the end of the Term, Tenant shall keep and maintain (and shall cause
all subtenants, concessionaires and licensees to keep and maintain) in the
Demised Premises or the main office of Tenant full and accurate books of account
and records from which the Gross Sales can be determined. The books and records
maintained shall include, but shall not be limited to (i) cash register tapes
showing continuous grand total (from a sealed cash register), (ii) original
source documents, (iii) sequentially numbered receipts, (iv) federal, state &
local tax returns, (v) receipts from daily bank deposits, (vi) computer
printouts and (vii) bank statements. Landlord shall have the right from time to
time during such thirty-six (36) month period to inspect and audit all such
books and records relating to Gross Sales, and Tenant, each subtenant,
concessionaire and licensee will produce the same on request of Landlord. If any
such inspection and audit discloses that the Gross Sales were understated,
Tenant shall forthwith pay to Landlord any additional Percentage Rent shown to
be payable, and if the Gross Sales for any Calendar Year or partial Calendar
Year were understated by more than Fifteen Thousand Dollars ($15,000.00), Tenant
shall also pay the cost of Landlord's inspection and audit. Landlord does not in
any way, or for any purpose, become a partner or joint venturer with Tenant
hereunder. The provisions of this Lease relating to Percentage Rent are included
solely for the purpose of providing a method whereby rentals are to be measured
and ascertained.
7
3.03. The Rent shall be paid in lawful money of the United States to
Landlord at its office, or such other place, or Landlord's agent, as Landlord
shall designate by notice to Tenant. Tenant shall pay the Rent promptly when due
without notice or demand therefor and without any abatement, deduction or setoff
for any reason whatsoever, except as may be expressly provided in this Lease. If
Tenant makes any payment to Landlord by check, same shall be by check of Tenant
and Landlord shall not be required to accept the check of any other Person, and
any check received by Landlord shall be deemed received subject to collection.
If any check is mailed by Tenant, Tenant shall post such check in sufficient
time prior to the date when payment is due so that such check will be received
by Landlord on or before the date when payment is due.
3.04. No payment by Tenant or receipt or acceptance by Landlord of a lesser
amount than the correct Rent shall be deemed to be other than a payment on
account, nor shall any endorsement or statement on any check or any letter
accompanying any check or payment be deemed an accord and satisfaction, and
Landlord may accept such check or payment without prejudice to Landlord's right
to recover the balance or pursue any other remedy in this Lease or at law
provided.
3.05. If Tenant is in arrears in payment of Rent, Tenant waives Tenant's
right, if any, to designate the items to which any payments made by Tenant are
to be credited, and Landlord may apply any payments made by Tenant to such items
as Landlord sees fit, irrespective of and notwithstanding any designation or
request by Tenant as to the items to which any such payments shall be credited.
3.06. In the event that any installment of Rent due hereunder shall be
overdue for five (5) business days, a "Late Charge" equal to three percent (3%)
or the maximum rate permitted by law, whichever is less ("Late Payment Rate")
for Rent so overdue may be charged by Landlord for each month or part thereof
that the same remains overdue. Any such Late Charges if not previously paid
shall, at the option of the Landlord, be added to and become part of the next
succeeding Rent payment to be made hereunder.
ARTICLE 4 - USE OF DEMISED PREMISES
4.01. Tenant shall use and occupy the Demised Premises for the Permitted
Uses, and Tenant shall not use or permit or suffer the use of the Demised
Premises or any part thereof for any other purpose.
4.02. If any governmental license or permit shall be required for the
proper and lawful conduct of Tenant's business in the Demised Premises or any
part thereof, Tenant shall duly procure and thereafter maintain such license or
permit and submit the same to Landlord for inspection. Tenant shall at all times
comply with the terms and conditions of each such license or permit. Tenant
shall not at any time use or occupy, or suffer or permit anyone to use or occupy
the Demised Premises, or do or permit anything to be done in the Demised
Premises, in any manner which (a) violates the Certificate of Occupancy for the
Demised Premises or for the Building; (b) causes or is
8
reasonably likely to cause injury to the Building or any equipment, facilities
or systems therein; (c) constitutes a violation of the Legal Requirements or
Insurance Requirements; (d) impairs or tends to impair the appearance of the
Building; (e) impairs or tends to impair the proper and economic maintenance,
operation and repair of the Building and/or its equipment, facilities or
systems; or (f) materially annoys or inconveniences other tenants or occupants
of the Building.
ARTICLE 5 - PREPARATION OF DEMISED PREMISES
5.01. The Demised Premises shall be completed and prepared for Tenant's
occupancy in the manner described in, and subject to the provisions of, Exhibit
C. Except as expressly provided to the contrary in this Lease, the taking of
possession by Tenant of the Demised Premises shall be conclusive evidence as
against Tenant that the Demised Premises and the Building were in good and
satisfactory condition at the time such possession was taken. Except as
expressly provided to the contrary in this Lease, Tenant is leasing the Demised
Premises "as is" on the date hereof.
5.02. If the substantial completion of the Landlord's Work shall be delayed
due to (a) any act or omission of Tenant or any of its employees, agents or
contractors (including, without limitation, [i] any delays due to changes in or
additions to the Landlord's Work, or [ii] any delays by Tenant in the submission
of plans, drawings, specifications or other information or in approving any
working drawings or estimates or in giving any authorizations or approvals), or
(b) any additional time needed for the completion of the Landlord's Work by the
inclusion in the Landlord's Work of any items specified by Tenant that require
long lead time for delivery or installation, then the Demised Premises shall be
deemed Ready for Occupancy on the date when they would have been ready but for
such delay(s). The Demised Premises shall be conclusively presumed to be in
satisfactory condition on the Commencement Date except for the minor or
insubstantial details of which Tenant gives Landlord notice within thirty (30)
days after the Commencement Date specifying such details (the "Punch List") with
reasonable particularity. Landlord shall use best efforts to complete said Punch
List within thirty (30) days of Landlord's receipt of Tenant's Punch List.
5.03. INTENTIONALLY OMITTED.
5.04. Landlord reserves the right, at any time and from time to time, to
increase, reduce or change the number, type, size, location, elevation, nature
and use of any of the Common Areas and the Building and any other buildings and
other improvements on the Land and in the Development, including, without
limitation, the right to move and/or remove same, provided same shall not
unreasonably block or interfere with Tenant's means of ingress or egress to and
from the Demised Premises.
ARTICLE 6 - TAX AND OPERATING EXPENSE PAYMENTS
6.01. Throughout the Term, Tenant agrees to pay to Landlord as an
Additional Charge hereunder, within fifteen (15) days in advance of the final
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date for which such is due without interest or penalty, Tenant's Fraction of the
Real Estate Taxes. If any assessment is payable in annual installments or in a
lump sum and Tenant does not elect to reimburse Landlord for such assessment in
a lump sum, there shall be added to the amount of the Real Estate Taxes payable
for the Calendar Year in which such assessment is payable and such subsequent
Calendar Year only that amount of such assessment, together with such interest
thereon, as would have been payable to the municipality in said Calendar Year if
Landlord had elected to pay said assessment in annual installments. Landlord
shall submit to Tenant copies of all bills covering Real Estate Taxes together
with an invoice showing the calculation of Tenant's Fraction of such Real Estate
Taxes.
6.02. Real Estate Taxes, whether or not a lien upon the Demised Premises
shall be apportioned between Landlord and Tenant at the beginning and end of the
Term; it being intended that Tenant shall pay only that portion of the Real
Estate Taxes as is allocable to the Demised Premises for the Term.
6.03. Tenant shall pay to Landlord Tenant's Fraction of the Operating
Expenses within twenty (20) days after Landlord submits to Tenant an invoice for
same.
6.04. Each such statement given by Landlord pursuant to Section 6.01 or
Section 6.03 shall be conclusive and binding upon Tenant unless within 30 days
after the receipt of such statement Tenant shall notify Landlord that it
disputes the correctness of the statement, specifying the particular respects in
which the statement is claimed to be incorrect. If such dispute is not settled
by agreement, either party may submit the dispute to arbitration as provided in
Article 34. Pending the determination of such dispute by agreement or
arbitration as aforesaid, Tenant shall, within ten (10) days after receipt of
such statement, pay the Additional Charges in accordance with Landlord's
statement, without prejudice to Tenant's position. If the dispute shall be
determined in Tenant's favor, Landlord shall forthwith pay to Tenant the amount
of Tenant's overpayment resulting from compliance with Landlord's statement,
plus interest thereon at the Late Payment Rate calculated from the date Tenant
first made payment of such disputed charges.
6.05. Landlord hereby grants Tenant the right, upon reasonable written
notice to Landlord, and at Tenant's sole cost and expense, to inspect Landlord's
books and records as same relate to Tenant's Operating Expenses and Real Estate
Taxes. Any such inspection shall occur at Landlord's normal place of business
and during Landlord's normal business hours.
ARTICLE 7 - COMMON AREAS
7.01. Subject to the provisions of Section 5.04, Landlord will operate,
manage, equip, light, repair and maintain, or cause to be operated, managed,
equipped, lighted, repaired and maintained, the Common Areas for their intended
purposes. Landlord reserves the right, at any time and from time to time, to
construct within the Common Areas kiosks, fountains, aquariums, planters, pools
and sculptures, and to install vending machines, telephone booths, benches and
the like, provided same shall not unreasonably
10
interfere with Tenant's means of ingress or egress to and from the Demised
Premises and provided same shall not otherwise materially increase Tenant's
expenses hereunder. Notwithstanding anything herein contained to the contrary,
Landlord agrees that Tenant shall not be responsible for any increase in
Operating Expenses related to purely esthetic improvements installed in the
Common Areas by Landlord unless (i) otherwise approved by Tenant or (ii)
directly benefitting Tenant's operation at the Demised Premises.
7.02. Tenant and its subtenants and concessionaires, and their respective
officers, employees, agents, customers and invitees, shall have the
non-exclusive right, in common with Landlord and all others to whom Landlord has
granted or may hereafter grant such right, but subject to the Rules and
Regulations, to use the Common Areas. Landlord reserves the right, upon fifteen
(15) days notice to Tenant (except in the event of an emergency), to close
temporarily all or any portions of the Common Areas when in Landlord's
reasonable judgment any such closing is necessary or desirable (a) to make
repairs or changes or to effect construction, (b) to prevent the acquisition of
public rights in such areas, (c) to discourage unauthorized parking, or (d) to
protect or preserve natural persons or property. Landlord may do such other acts
in and to the Common Areas as in its judgment may be desirable to improve or
maintain same; provided, however, Landlord hereby agrees to use its best
efforts, in connection with the exercise of its rights under this Article 7.02,
not to materially interfere with Tenant's use and occupancy of the Demised
Premises.
7.03. Tenant agrees that it, any subtenant or licensee and their respective
officers, employees, contractors and agents will park their automobiles and
other vehicles only where and as permitted by Landlord. Tenant will, if and when
so requested by Landlord, furnish Landlord with the license numbers of any
vehicles of Tenant, any subtenant or licensee and their respective officers,
employees and agents.
7.04. Subject to the provisions of Article 7.02 hereinabove, Landlord
hereby agrees that Tenant shall have exclusive right to the use of the area(s)
outside of the loading docks located within the Demised Premises subject, also
however, to Landlord's right to grant any other tenant of the Building access to
and from any other portion of the Building not a part of the Demised Premises.
ARTICLE 8 - SECURITY
8.01. Tenant has deposited with Landlord the Security Deposit as security
for the full and faithful payment and performance by Tenant of Tenant's
obligations under this Lease. If Tenant defaults in the full and prompt payment
and performance of any of its obligations under this Lease, including, without
limitation, the payment of Rent, Landlord may use, apply or retain the whole or
any part of the Security Deposit to the extent required for the payment of any
Rent or any other sums as to which Tenant is in default or for any sum which
Landlord may expend or may be required to expend by reason of Tenant's default
in respect of any of Tenant's obligations under
11
this Lease, including, without limitation, any damages or deficiency in the
reletting of the Demised Premises, whether such damages or deficiency accrue
before or after summary proceedings or other re-entry by Landlord. If Landlord
shall so use, apply or retain the whole or any part of the security, Tenant
shall upon demand immediately deposit with Landlord a sum equal to the amount so
used, applied and retained, as security as aforesaid. If Tenant shall fully and
faithfully pay and perform all of Tenant's obligations under this Lease, the
Security Deposit or any balance thereof to which Tenant is entitled shall be
returned or paid over to Tenant after the date on which this Lease shall expire
or sooner end or terminate, and after delivery to Landlord of entire possession
of the Demised Premises. In the event of any sale or leasing of the Land,
Landlord shall have the right to transfer the security to which Tenant is
entitled to the vendee or lessee and Landlord shall thereupon be released by
Tenant from all liability for the return or payment thereof; and Tenant shall
look solely to the new landlord for the return or payment of the same; and the
provisions hereof shall apply to every transfer or assignment made of the same
to a new landlord. Tenant shall not assign or encumber or attempt to assign or
encumber the monies deposited herein as security, and neither Landlord nor its
successors or assigns shall be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance.
8.02. Tenant shall have the option of posting a letter of credit in lieu of
a cash security deposit in which case the following provisions (i.e. Articles
8.02, 8.03 and 8.04) shall apply: As security for the performance by Tenant of
all the terms, conditions and covenants of this Lease upon Tenant's part to be
performed, Tenant shall provide to Landlord an irrevocable Letter of Credit in
the amount of Eighty Thousand Three Hundred Eighty Nine and 50/100 ($80,389.50)
in form and substance satisfactory to Landlord. Landlord shall have the right,
upon thirty (30) days notice to Tenant (except for Tenant's non-payment of Rent
or for Tenant's failure to comply with Article 8.03 for which no notice shall be
required), and regardless of the exercise of any other remedy the Landlord may
have by reason of a default, to draw upon said Letter of Credit to cure any
default of Tenant and if Landlord does so, Tenant shall upon demand,
additionally fund the Letter of Credit with the amount so drawn so that Landlord
shall have the full deposit on hand at all times during the Term of this Lease.
In the event of a sale of the Building or a lease of the Building, subject to
this Lease, Landlord shall have the right to transfer the security to the vendee
or lessee.
8.03. The Letter of Credit shall be the type which is automatically renewed
on an annual basis (annual Renewal Date); and will contain a provision requiring
the issuer thereof to give the beneficiary (Landlord) sixty (60) day advance
written notice of its intention not to renew the Letter of Credit on the next
Annual Renewal Date.
8.04. In the event Tenant shall fail to deliver to Landlord a substitute
irrevocable Letter of Credit, in the amount stated above, on or before thirty
(30) days prior to the next Annual Renewal Date, said failure shall be deemed a
default under this Lease. Landlord may, in its discretion treat this the same as
a default in the payment of rent or any other default and pursue the appropriate
remedy. In addition, and not in limitation,
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Landlord shall be permitted to draw upon the Letter of Credit as in the case of
any other default by Tenant under this Lease.
ARTICLE 9 - SUBORDINATION
9.01. This Lease, and all rights of Tenant hereunder, are and shall be
subject and subordinate to all ground leases and underlying leases of the Land
and/or the Building now or hereafter existing and to all Mortgages which may now
or hereafter affect the Land and/or building and/or any of such leases, whether
or not such Mortgages or leases shall also cover other lands and/or buildings,
to each and every advance made or hereafter to be made under such Mortgages, and
to all renewals, modifications, replacements and extensions of such leases and
such Mortgages and spreaders and consolidations of such Mortgages. The
provisions of this Section 9.01 shall be self-operative and no further
instrument of subordination shall be required. In confirmation of such
subordination, Tenant shall promptly execute, acknowledge and deliver any
instrument that Landlord, the lessor under any such lease or the Mortgagee of
any such Mortgage or any of their respective successors in interest may
reasonably request to evidence such subordination.
9.02. If any act or omission of Landlord would give Tenant the right,
immediately or after lapse of a period of time, to cancel or terminate this
Lease, or to claim a partial or total eviction, Tenant shall not exercise such
right (a) until it has given written notice of such act or omission to Landlord
and each Superior Mortgagee and each Superior Lessor whose name and address
shall previously have been furnished to Tenant by Landlord in writing, and (b)
until a reasonable period for remedying such act or omission shall have elapsed
following the giving of such notice and following the time when such Superior
Mortgagee or Superior Lessor shall have become entitled under such Superior
Mortgage or Superior Lease, as the case may be, to remedy the same (which
reasonable period shall in no event be less than the period to which Landlord
would be entitled under this Lease or otherwise, after similar notice, to effect
such remedy), provided such Superior Mortgagee or Superior Lessor shall with due
diligence give Tenant notice of intention to, and commence and continue to,
remedy such act or omission.
9.03. If any Superior Lessor or Superior Mortgagee shall succeed to the
rights of Landlord 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 Landlord's rights ("Successor Landlord") and upon such Successor
Landlord's written agreement to accept Tenant's attornment, Tenant shall attorn
to and recognize such Successor Landlord as Tenant's landlord under this Lease
and shall promptly execute and deliver any instrument that such Successor
Landlord may reasonably request to evidence such attornment. Upon such
attornment this Lease shall continue in full force and effect as a direct lease
between the Successor Landlord and Tenant upon all of the terms, conditions and
covenants as are set forth in this Lease except that the Successor Landlord
shall not (a) be liable for any previous act or omission of Landlord under this
Lease; (b) be subject to any offset, not expressly provided for in this Lease,
which theretofore shall have accrued to Tenant against Landlord; (c) be liable
for the return of any Security Deposit, in
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whole or in part, to the extent that same is not paid over to the Successor
Landlord; or (d) be bound by any previous prepayment of more than one month's
Fixed Rent unless such prepayment shall have been expressly approved in writing
by the Superior Lessor of the Superior Lease or the Mortgagee of the Superior
Mortgage through or by reason of which the Successor Landlord shall have
succeeded to the rights of Landlord under this Lease.
9.04. If any then present or prospective Superior Mortgagee shall require
any modification(s) of this Lease, Tenant shall promptly execute and deliver to
Landlord such instruments effecting such modification(s) as Landlord shall
request, provided that such modification(s) do not adversely affect in any
material respect any of Tenant's rights or obligations under this Lease.
9.05. Landlord hereby agrees to provide Tenant with a Non-Disturbance
Agreement from the existing Superior Mortgagee provided same is in the form
annexed hereto as Exhibit E.
9.06. As an express condition to the agreement of Tenant to the foregoing
provisions of this Article 9, Landlord hereby agrees to provide Tenant with a
Non-Disturbance Agreement from any future Superior Mortgagee provided same is in
the form, generally, as that annexed hereto as Exhibit E.
9.07. Landlord hereby represents that it is not presently in default of the
existing Superior Mortgage.
9.08. Any Superior Mortgagee's fees and/or costs (including reasonable
legal costs) associated with the acquisition and delivery of any Non-
Disturbance Agreement shall be borne by Landlord.
ARTICLE 10 - QUIET ENJOYMENT
10.01. So long as Tenant pays all of the Rent and performs all of Tenant's
other obligations hereunder, Tenant shall peaceably and quietly have, hold and
enjoy the Demised Premises without hindrance, ejection or molestation by
Landlord or any person lawfully claiming through or under Landlord, subject,
nevertheless, to the provisions of this Lease and to Superior Leases and
Superior Mortgages, of which Landlord has notified Tenant in writing (which
notice requirement, for purposes of this Section 10.01, shall be deemed
satisfied upon Tenant's execution of an estoppel certificate or non-disturbance,
subordination and attornment agreement with respect to any such Superior Lessor
or Superior Mortgagee).
ARTICLE 11 - ASSIGNMENT, SUBLETTING AND MORTGAGING
11.01. Tenant shall not, whether voluntarily, involuntarily, or by
operation of law or otherwise, (a) assign or otherwise transfer this Lease, or
offer or advertise to do so, (b) sublet the Demised Premises or any part
thereof, or offer or advertise to do so, or allow the same to be used, occupied
or utilized by anyone other than Tenant, or (c) mortgage, pledge, encumber or
otherwise hypothecate this Lease in any manner whatsoever, without
14
in each instance obtaining the prior written consent of Landlord, which consent
shall not be unreasonably withheld, delayed, or conditioned. Landlord hereby
acknowledges that Tenant intends to sublease all or some portion of the Retail
Premises. Landlord hereby consents to such subletting provided, however, in
consideration thereof, Tenant hereby agrees to pay Landlord, as an Additional
Charge hereunder, fifty percent (50%) of the net profit achieved from such
subletting. "Net Profit", as that term is used herein, shall mean the difference
between (a) the rent Tenant receives from the aforesaid subtenant(s) (which
shall include, but not be limited to, all fixed rent and percentage rent, or
similar such "rents" without placing any emphasis on terminology) with deduction
for Tenant's reasonable expenses (i.e. brokerage commissions, reasonable cost of
construction, etc.) specifically associated with such subletting and (b) the
Rent Tenant is obligated to pay Landlord hereunder. Tenant agrees to provide
Landlord with copies of any such sublease(s) within ten (10) days of execution
of same. It is expressly understood and agreed by the parties hereto that the
gross sales generated by said subtenant(s) will not be included in the
definition of Gross Sales set forth at Article 1.01.(01); provided, however
Tenant agrees that notwithstanding the terminology used in any sublease, it will
calculate the gross sales of any such subtenant, for purposes of calculating the
50/50 division of profits discussed above, in a manner similar to the method by
which Gross Sales are calculated hereunder.
11.02. If at any time (a) the original Tenant named herein, (b) the then
Tenant, (c) any Guarantor, or (d) any Person owning a majority of the voting
stock of, or directly or indirectly controlling, the then Tenant shall be a
corporation or partnership, any transfer of voting stock or partnership interest
resulting in the person(s) who shall have owned a majority of such corporation's
shares of voting stock or the general partners' interest in such partnership, as
the case may be, immediately before such transfer, ceasing to own a majority of
such shares of voting stock or general partner's interest, as the case may be,
except as the result of transfers by inheritance, shall be deemed to be an
assignment of this Lease as to which Landlord's consent shall have been
required, and in any such event Tenant shall notify Landlord. The provisions of
this Section 11.02 shall not be applicable to any corporation all the
outstanding voting stock of which is listed on a national securities exchange
(as defined in the Securities Exchange Act of 1934, as amended) or is traded in
the over-the-counter market with quotations reported by the National Association
of Securities Dealers through its automated system for reporting quotations and
shall not apply to transactions with a corporation into or with which the then
Tenant is merged or consolidated or to which substantially all of the then
Tenant's assets are transferred or to any corporation which controls or is
controlled by the then Tenant or is under common control with the then Tenant,
provided that in any of such events (i) the successor to Tenant has a net worth
computed in accordance with generally accepted accounting principles at least
equal to the greater of (1) the net worth of Tenant immediately prior to such
merger, consolidation or transfer, or (2) the net worth of the original Tenant
on the date of this Lease, and (ii) proof satisfactory to Landlord of such net
worth shall have been delivered to Landlord at least 10 days prior to the
effective date of any such transaction. For the purposes of this Section, the
words "voting stock" shall refer to shares of stock regularly entitled to vote
for the election of
15
directors of the corporation. Landlord shall have the right at any time and from
time to time during the Term to inspect the stock record books of the
corporation to which the provisions of this Section 11.02 apply, and Tenant will
produce the same on request of Landlord.
11.03. If this Lease is assigned, whether or not in violation of this
Lease, Landlord may collect rent from the assignee. If the Demised Premises or
any part thereof are sublet or used or occupied by anybody other than Tenant,
whether or not in violation of this Lease, Landlord may, after default by
Tenant, and expiration of Tenant's time to cure such default, collect rent from
the subtenant or occupant. In either event, Landlord may apply the net amount
collected to the Rent, but no such assignment, subletting, occupancy or
collection shall be deemed a waiver of any of the provisions of Section 11.01 or
Section 11.02, or the acceptance of the assignee, subtenant or occupant as
tenant, or a release of Tenant from the performance by Tenant of Tenant's
obligations under this Lease. The consent by Landlord to any assignment,
mortgaging, subletting or use or occupancy by others shall not in any way be
considered to relieve Tenant from obtaining the express written consent of
Landlord to any other or further assignment, mortgaging or subletting or use or
occupancy by others not expressly permitted by this Article 11. References in
this Lease to use or occupancy by others (that is, anyone other than Tenant)
shall not be construed as limited to subtenants and those claiming under or
through subtenants but shall be construed as including also licensees and others
claiming under or through Tenant, immediately or remotely.
11.04. Any permitted assignment or transfer, whether made with Landlord's
consent pursuant to Section 11.01 or without Landlord's consent if permitted by
Section 11.02, shall be made only if, and shall not be effective until, the
assignee shall execute, acknowledge and deliver to Landlord an agreement in form
and substance reasonably satisfactory to Landlord whereby the assignee shall
assume Tenant's obligations under this Lease and whereby the assignee shall
agree that all of the provisions in this Article 11 shall, notwithstanding such
assignment or transfer, continue to be binding upon it in respect to all future
assignments and transfers. Notwithstanding any assignment or transfer, whether
or not in violation of the provisions of this Lease, and notwithstanding the
acceptance of Rent by Landlord from an assignee, transferee, or any other party,
the original Tenant and any other person)s) who at any time was or were Tenant
shall remain fully liable for the payment of the Rent and for Tenant's other
obligations under this Lease.
11.05. The liability of the original named Tenant and any other Person(s)
(including but not limited to any Guarantor) who at any time are or become
responsible for Tenant's obligations under this Lease shall not be discharged,
released or impaired by any agreement or stipulation made by Landlord extending
the time of, or modifying any of the terms or obligations under this Lease, or
by any waiver or failure of Landlord to enforce, any of this Lease.
11.06. The listing of any name other than that of Tenant, whether on the
doors of the Demised Premises or the Building directory, or otherwise, shall not
operate to vest any right or interest in this Lease or in the
16
Demised Premises, nor shall it be deemed to be the consent of Landlord to any
assignment or transfer of this Lease or to any sublease of the Demised Premises
or to the use or occupancy thereof by others.
11.07. Without limiting any of the provisions of Article 27, if pursuant to
the Federal Bankruptcy Code (or any similar law hereafter enacted having the
same general purpose), Tenant is permitted to assign this Lease notwithstanding
the restrictions contained in this Lease, adequate assurance of future
performance by an assignee expressly permitted under such Code shall be deemed
to mean the deposit of cash security in an amount equal to the sum of one (1)
year's Fixed Rent, which deposit shall be held by Landlord for the balance of
the Term, without interest, as security for the full performance of all of
Tenant's obligations under this Lease, to be held and applied in the manner
specified for security in Section 8.01.
11.08. If Tenant shall propose to assign or in any manner transfer this
Lease or any interest therein, or sublet the Demised Premises or any part or
parts thereof, or grant any concession or license or otherwise permit occupancy
of all or any part of the Demised Premises by any person, Tenant shall give
notice thereof to Landlord, together with a copy of the proposed instrument that
is to accomplish same and such financial and other information pertaining to the
proposed assignee, transferee, subtenant, concessionaire or licensee as Landlord
shall reasonably require.
ARTICLE 12 - COMPLIANCE WITH LAWS
12.01. Tenant shall comply with all Legal Requirements which shall, in
respect of the Demised Premises or the use and occupation thereof, or the
abatement of any nuisance in, on or about the Demised Premises, impose any
violation, order or duty on Landlord or Tenant; and Tenant shall pay all the
costs, expenses, fines, penalties and damages which may be imposed upon Landlord
or any Superior Lessor by reason of or arising out of Tenant's failure to fully
and promptly comply with and observe the provisions of this Section 12.01.
However, Tenant need not comply with any such law or requirement of any public
authority, nor shall such failure to comply be deemed an Event of Default
hereunder, so long as Tenant shall be contesting the validity thereof, or the
applicability thereof to the Demised Premises, in accordance with Section 12.02.
12.02. Tenant may contest, by appropriate proceedings prosecuted diligently
and in good faith, the validity, or applicability to Tenant or the Demised
Premises, of any Legal Requirement, provided that (a) Landlord shall not be
subject to criminal penalty or to prosecution for a crime, and neither the
Demised Premises nor any part thereof shall be subject to being condemned or
vacated, by reason of non-compliance or otherwise by reason of such contest; (b)
before the commencement of such contest, Tenant shall furnish to Landlord the
bond of a surety company satisfactory to Landlord, which bond shall be, as to
its provisions and form, satisfactory to Landlord, and shall be in an amount at
least equal to 100% of the cost of such compliance (as estimated by a reputable
contractor designated by Landlord) and shall indemnify Landlord against the cost
thereof and against all liability for
17
damages, interest, penalties and expenses (including reasonable attorneys' fees
and expenses), resulting from or incurred in connection with such contest or
non-compliance, (c) such non-compliance or contest shall not constitute or
result in any violation of any Superior Lease or Superior Mortgage, or if any
such Superior Lease and/or Superior Mortgage shall permit such non-compliance or
contest on condition of the taking of action or furnishing of security by
Landlord, such action shall be taken and such security shall be furnished at the
expense of Tenant; and (d) Tenant shall keep Landlord advised as to the status
of such proceedings. Without limiting the application of the above, Landlord
shall be deemed subject to prosecution for a crime if Landlord, or its managing
agent, or any officer, director, partner, shareholder or employee of Landlord or
its managing agent, as an individual, is charged with a crime of any kind or
degree whatsoever, whether by service of a summons or otherwise, unless such
charge is withdrawn before Landlord or its managing agent, or such officer,
director, partner, shareholder or employee of Landlord or its managing agent (as
the case may be) is required to plead or answer thereto.
12.03. Notwithstanding the foregoing, Landlord hereby represents, to the
best of its knowledge and belief, that the Building and the Land are presently
in compliance with all applicable Legal Requirements, including, but not limited
to, those existing environmental Legal Requirements affecting the Demised
Premises, including, but not limited to, the Industrial Site Recovery Act, the
Spill Compensation and Control Act and the Comprehensive Environmental Response
Compensation and Liability Act. Landlord hereby agrees that it shall be
responsible for the Building's and Land's compliance with those Legal
Requirements in existence prior to the execution of this Lease.
12.04. Landlord hereby agrees that Tenant shall not be responsible for
those violation(s) of any applicable environmental Legal Requirement resulting
from the act, omission or negligence of another tenant in the Building unless,
and to the extent, same is also a result of the act, omission, or negligence of
Tenant, its agents, employees, representatives or contractors.
ARTICLE 13 - INSURANCE AND INDEMNITY
13.01. Landlord shall maintain or cause to be maintained All Risk insurance
in respect of the Building and other improvements on the Land normally covered
by such insurance at commercially competitive rates (except for the property
Tenant is required to cover with insurance under Section 13.02 and similar
property of other tenants and occupants of the Building or buildings and other
improvements which are on land neither owned by nor leased to Landlord) for the
benefit of Landlord, any Superior Lessors, any Superior Mortgagees and any other
parties Landlord may at any time and from time to time designate, as their
interests may appear, but not for the benefit of Tenant, and shall maintain rent
insurance as required by any Superior Lessor or any Superior Mortgagee. The All
Risk insurance will be in the amounts required by any Superior Lessor or any
Superior Mortgagee but not less than the amount sufficient to avoid the effect
of the co-insurance provisions of the applicable policy or policies. Landlord
may also maintain any other forms and types of insurance which Landlord shall
deem reasonable in respect of the
18
Building and Land. Landlord shall have the right to provide any insurance
maintained or caused to be maintained by it under blanket policies.
13.02. Tenant shall maintain the following insurance: (a) comprehensive
general public liability insurance in respect of the Demised Premises and the
conduct and operation of business therein, having not less than a $5,000,000.00
combined single limit per occurrence for bodily injury or death to any one
person and for bodily injury or death to any number of persons in any one
occurrence, and for property damage, including water damage and sprinkler
leakage legal liability (coverage to include but not be limited to (i) premises
operation, completed operations, broad form contractual liability and product
liability, (ii) comprehensive automobile, truck and vehicle liability insurance
covering all owned, hired and non-owned vehicles used by the contractor(s) in
connection with their work and any loading of such vehicles, with limits as
stated above and (iii) worker's compensation, employers liability and
occupational disease insurance as required by statutes, but in any event not
less than $500,000.00 for Coverage B covering all damages and injuries arising
from each accident or occupational disease) (b) steam boiler, air conditioning
and machinery insurance, protecting Landlord and Tenant, with limits of not less
than $500,000, if there is a boiler or pressure object or other similar
equipment in the Demised Premises, and (c) All Risk insurance in respect of
Tenant's stock in trade, fixtures, furniture, furnishings, removable floor
coverings, equipment, signs and all other property of Tenant in the Demised
Premises in an amount sufficient to avoid the effect of the co-insurance
provisions of the applicable policy or policies, and (d) such other insurance as
is required for compliance with the Insurance Requirements. Landlord may at any
time and from time to time require that the limits for the comprehensive general
public liability insurance to be maintained by Tenant be increased to the limits
that new tenants in the Building are required by Landlord to maintain, provided
same are commercially reasonable and consistent with the then industry practice
relative to comprehensive general public liability insurance limits. Tenant
shall deliver to Landlord and any additional named insured(s) certificates for
such fully paid-for policies at least ten (10) days before the Commencement
Date. Tenant shall procure and pay for renewals of such insurance from time to
time before the expiration thereof, and Tenant shall deliver to Landlord and any
additional insured(s) certificates therefor at least thirty (30) days before the
expiration of any existing policy. All such policies shall be issued by
companies of recognized responsibility, having a Bests Key Rating Guide of not
less than A, Class VII, licensed to do business in New Jersey, and all such
policies shall contain a provision whereby the same cannot be canceled unless
Landlord and any additional insured(s) are given at least thirty (30) days'
prior written notice of such cancellation. The certificates of insurance to be
delivered to Landlord by Tenant shall name Landlord as an additional insured
and, at Landlord's request, shall also name any Superior Lessors or Superior
Mortgagees of which Landlord has notified Tenant as additional insureds, and the
following phrase must be typed on the certificate of insurance: "Hartz Mountain
Associates, Hartz Mountain Industries, Inc., and its respective subsidiaries,
affiliates, associates, joint ventures, and partnerships, are hereby named as
additional insureds as their interests may appear (and if Landlord has so
requested, Tenant shall include any Superior Lessors and Superior Mortgagees as
additional insured(s)). It is intended for
19
this insurance to be primary and non-contributing." Tenant shall give Landlord
at least thirty (30) days' prior written notice that any such policy is being
canceled or replaced.
13.03. Tenant shall not do, permit or suffer to be done any act, matter,
thing or failure to act in respect of the Demised Premises or use or occupy the
Demised Premises or conduct or operate Tenant's business in any manner
objectionable to any insurance company or companies whereby the fire insurance
or any other insurance then in effect in respect of the Land and Building or any
part thereof shall become void or suspended or whereby any premiums in respect
of insurance maintained by Landlord shall be higher than those which would
normally have been in effect for the occupancy contemplated under the Permitted
Uses. In case of a breach of the provisions of this Section 13.03, in addition
to all other rights and remedies of Landlord hereunder, Tenant shall pay to
Landlord any and all increases of premiums on any insurance, including, without
limitation, rent insurance, resulting from any such breach.
13.04. Tenant shall indemnify and hold harmless Landlord and all Superior
Lessors and its and their respective partners, joint venturers, directors,
officers, agents, servants and employees from and against any and all claims for
injuries to persons or damage to the property of third parties arising from or
in connection with (a) the conduct or management of the Demised Premises or of
any business therein, or any work or thing whatsoever done, or any condition
created (other than by Landlord) in the Demised Premises during the Term or
during the period of time, if any, prior to the Commencement Date that Tenant
may have been given access to the Demised Premises; (b) any act, omission or
negligence of Tenant or any of its subtenants or licensees or its or their
partners, joint venturers, directors, officers, agents, employees or
contractors; (c) any accident, injury or damage whatever (unless caused by
Landlord's negligence) occurring in the Demised Premises; and (d) any breach or
default by Tenant in the full and prompt payment and performance of Tenant's
obligations under this Lease; together with all costs, expenses and liabilities
incurred in or in connection with each such claim or action or proceeding
brought thereon, including, without limitation, all attorneys' fees and
expenses. In case any action or proceeding is brought against Landlord and/or
any Superior Lessor and/or its or their partners, joint venturers, directors,
officers, agents and/or employees by reason of any such claim, Tenant, upon
notice from Landlord or such Superior Lessor, shall resist and defend such
action or proceeding by counsel reasonably satisfactory to Landlord. Landlord
hereby agrees to cooperate with Tenant and designated counsel in connection with
such defense. Landlord agrees to notify Tenant of any claim of which it becomes
aware under this Article 13.04. Tenant further agrees that it or its designated
counsel will not settle or otherwise compromise any such claim without the prior
consent of Landlord.
13.05. Landlord shall indemnify and hold Tenant and/or its partners, joint
venturers, directors, officers, agents and/or employees harmless from and
against any and all claims for injuries to persons or damage to the property of
third parties arising from or in connection with (a) any work done by Landlord
or any condition created by Landlord in the Demised Premises or
20
the Common Areas and (b) any act, omission, or negligence or Landlord in
connection with the maintenance of the Demised Premises or Common Areas;
together with all costs, expense and liabilities incurred in or in connection
with each such claim or action or proceeding brought thereon, including, without
limitation, all attorneys fees and expenses. In case any action or proceeding is
brought against Tenant and/or its partners, joint venturers, directors,
officers, agents and/or employees by reason of any such claim, Landlord, upon
notice from Tenant, shall resist and defend such action or proceeding by counsel
reasonably satisfactory to Tenant. Tenant hereby agrees to cooperate with
Landlord and designated counsel in connection with such defense. Tenant agrees
to notify Landlord of any claim of which it becomes aware under this Article
13.05. Landlord further agrees that it or its designated counsel will not settle
or compromise any such claim without the prior consent of Tenant.
13.06. Neither party shall be liable or responsible for, and each party
hereby releases the other from, all liability and responsibility to the other
and any person claiming by, through or under the other, by way of subrogation,
for any injury, loss or damage to any person or property in or around the
Demised Premises or to the other's business covered by insurance carried or
required to be carried hereunder irrespective of the cause of such injury, loss
or damage, and each party shall require its insurers to include in all of such
party's insurance policies which could give rise to a right of subrogation
against the other a clause or endorsement whereby the insurer waives any rights
of subrogation against the other or permits the insured, prior to any loss, to
agree with a third party to waive any claim it may have against said third party
without invalidating the coverage under the insurance policy.
ARTICLE 14 - RULES AND REGULATIONS
14.01. Tenant and its employees and agents shall faithfully observe and
comply with the Rules and Regulations and such reasonable changes therein
(whether by modification, elimination or addition) as Landlord at any time or
times hereafter may make and communicate to Tenant, which in Landlord's
judgment, shall be necessary for the reputation, safety, care or appearance of
the Land and Building, or the preservation of good order therein, or the
operation or maintenance of the Building or its equipment and fixtures, or the
Common Areas, and which do not (i) unreasonably affect the conduct of Tenant's
business in the Demised Premises, (ii) diminish, in any material sense, Tenant's
rights under this Lease, or (iii) increase, in any material sense, Tenant's
obligations under this Lease; provided, however, that in case of any conflict or
inconsistency between the provisions of this Lease and any of the Rules and
Regulations, the provisions of this Lease shall control. Landlord shall not be
liable to Tenant for violation of the Rules and Regulations by any other tenant
or its employees, agents, invitees or licensees. Landlord hereby agrees that it
shall not enforce the Rules and Regulations as against Tenant in a
discriminatory manner vis-a-vis the other tenants in the Building.
21
ARTICLE 15 - ALTERATIONS AND SIGNS
15.01. Tenant shall not make any alterations or additions to the Demised
Premises, or make any holes or cuts in the walls, ceilings, roofs, or floors
thereof, or change the exterior color or architectural treatment of the Demised
Premises, without on each occasion first obtaining the consent of Landlord,
which consent shall not be unreasonably withheld, delayed or conditioned;
provided, however, with respect to those alterations to the Demised Premises
which do not exceed a cost, in the aggregate, of $150,000, or otherwise impact
upon the structure or systems of the Building, Landlord's consent shall not be
required. With respect to those alterations wherein Landlord's consent is
required, Tenant shall submit to Landlord plans and specifications for such work
at the time Landlord's consent is sought. Tenant shall pay to Landlord upon
demand the reasonable cost and expense of Landlord in (a) reviewing said plans
and specifications and (b) inspecting the alterations to determine whether the
same are being performed in accordance with the approved plans and
specifications and all Legal Requirements and Insurance Requirements, including,
without limitation, the fees of any architect or engineer employed by Landlord
for such purpose. Before proceeding with any permitted alteration which will
cost more than $150,000 (exclusive of the costs of decorating work and items
constituting Tenant's Property), as estimated by a reputable contractor
designated by Landlord, Tenant shall obtain and deliver to Landlord a
performance bond and a labor and materials payment bond (issued by a corporate
surety licensed to do business in New Jersey), each in an amount equal to 100%
of such estimated cost and in form satisfactory to Landlord. Tenant shall fully
and promptly comply with and observe the Rules and Regulations then in force in
respect of the making of alterations. Any review or approval by Landlord of any
plans and/or specifications with respect to any alterations is solely for
Landlord's benefit, and without any representation or warranty whatsoever to
Tenant in respect of the adequacy, correctness or efficiency thereof or
otherwise. Landlord hereby expressly consents to the alterations to be performed
by Tenant in connection with initial build-out of the Demised Premises.
15.02. Tenant shall obtain all necessary governmental permits and
certificates for the commencement and prosecution of permitted alterations and
for final approval thereof upon completion, and shall cause alterations to be
performed in compliance therewith and with all applicable Legal Requirements and
Insurance Requirements. Alterations shall be diligently performed in a good and
workmanlike manner, using materials and equipment at least equal in quality and
class to the better of (a) the original installations of the Building, or (b)
the then standards for the Building established by Landlord. Alterations shall
be performed by contractors first approved by Landlord; provided, however, that
any alterations in or to the mechanical, electrical, sanitary, heating,
ventilating, air conditioning or other systems of the Building shall be
performed only by the contractor(s) designated by Landlord. Alterations shall be
made in such manner as not to unreasonably interfere with or delay and as not to
impose any additional expense upon Landlord in the construction, maintenance,
repair or operation of the Building; and if any such additional expense shall be
incurred by Landlord as a result of Tenant's making of any alterations, Landlord
shall so notify Tenant of such additional expense, and, to the extent Tenant
continues to desire to perform such
22
alteration, Tenant shall pay any such additional expense upon demand. Throughout
the making of alterations, Tenant shall carry, or cause to be carried, worker's
compensation insurance in statutory limits and general liability insurance, with
completed operation endorsement, for any occurrence in or about the Building,
under which Landlord and its managing agent and any Superior Lessor whose name
and address shall previously have been furnished to Tenant shall be named as
parties insured, in such limits as Landlord may reasonably require, with
insurers reasonably satisfactory to Landlord. Tenant shall furnish Landlord with
reasonably satisfactory evidence that such insurance is in effect at or before
the commencement of alterations and, on request, at reasonable intervals
thereafter during the making of alterations. In connection with Landlord's
approval of Tenant's contractors, it is specifically agreed and understood by
the parties hereto that once Landlord has so approved a particular contractor,
said approval shall remain in force and effect through the Term without the need
for further request by Tenant unless an until Landlord otherwise advises Tenant
to the contrary.
15.03. Tenant shall not place any signs on the roof, exterior walls or
grounds of the Demised Premises without first obtaining Landlord's written
consent thereto, which consent shall not be unreasonably withheld, delayed or
conditioned provided Tenant's signage is similar, generally, to the other
signage permitted by Landlord on its other buildings in Harmon Cove and provided
same is in compliance with applicable Legal Requirements. In placing any signs
on or about the Demised Premises, Tenant shall, at its expense, comply with all
applicable Legal Requirements and obtain all required permits and/or licenses.
15.04. Notwithstanding anything contained in this Article 15 to the
contrary, Landlord hereby approves those contractors to be utilized by Tenant
set forth on the attached Exhibit F.
ARTICLE 16 - LANDLORD'S AND TENANT'S PROPERTY
16.01. All fixtures, equipment, improvements and appurtenances attached to
or built into the Demised Premises at the commencement of or during the Term,
whether or not by or at the expense of Tenant, shall be and remain a part of the
Demised Premises, shall be deemed to be the property of Landlord and shall not
be removed by Tenant, except as provided in Section 16.02. Further, any
carpeting or other personal property in the Demised Premises on the Commencement
Date, unless installed and paid for by Tenant, shall be and shall remain
Landlord's property and shall not be removed by Tenant.
16.02. All movable partitions, business and trade fixtures, machinery and
equipment, material handling equipment, communications equipment and office
equipment, whether or not attached to or built into the Demised Premises, which
are installed in the Demised Premises by or for the account of Tenant without
expense to Landlord and can be removed without structural damage to the Building
and all furniture, furnishings, and other movable personal property owned by
Tenant and located in the Demised Premises (collectively, "Tenant's Property")
shall be and shall remain the property of Tenant and may be removed by Tenant at
any time during the Term; provided that if any of the Tenant's Property is
removed, Tenant shall repair or pay the
23
cost of repairing any damage to the Demised Premises, the Building or the Common
Areas resulting from the installation and/or removal thereof. Any equipment or
other property for which Landlord shall have granted any allowance or credit to
Tenant shall not be deemed to have been installed by or for the account of
Tenant without expense to Landlord, shall not be considered as the Tenant's
Property and shall be deemed the property of Landlord.
16.03. At or before the Expiration Date or the date of any earlier
termination of this Lease, or within fifteen (15) days after such an earlier
termination date, Tenant shall remove from the Demised Premises all of the
Tenant's Property (except such items thereof as Landlord shall have expressly
permitted to remain hereunder, which property shall become the property of
Landlord if not removed), and Tenant shall repair any damage to the Demised
Premises, the Building and the Common Areas resulting from any installation
and/or removal of the Tenant's Property. Any items of the Tenant's Property
which shall remain in the Demised Premises after the Expiration Date or after a
period of fifteen (15) days following an earlier termination date, may, at the
option of Landlord, be deemed to have been abandoned, and in such case such
items may be retained by Landlord as its property or disposed of by Landlord,
without accountability, in such manner as Landlord shall determine at Tenant's
reasonable expense.
ARTICLE 17 - REPAIRS AND MAINTENANCE
17.01. Tenant shall, throughout the Term, take good care of the Demised
Premises, the fixtures and appurtenances therein, and shall not do, suffer, or
permit any waste with respect thereto. Tenant shall keep and maintain all
interior portions of the Demised Premises including without limitation all
building equipment, windows, doors, loading bay doors and shelters, plumbing and
electrical systems, heating, ventilating and air conditioning ("HVAC") systems
in a clean and orderly condition. The phrase "keep and maintain" as used herein
includes repairs, replacement and/or restoration as appropriate. Tenant shall
not permit or suffer any over-loading of the floors of the Demised Premises.
Tenant shall be responsible for all repairs in and to the Demised Premises and
the Building (including the facilities and systems thereof) and the Common Areas
the need for which arises out of (a) the performance or existence of the
Tenant's Work or alterations, (b) the installation, use or operation of the
Tenant's Property in the Demised Premises, (c) the moving of the Tenant's
Property in or out of the Building, or (d) the act, omission, misuse or neglect
of Tenant or any of its subtenants or its or their employees, agents,
contractors or invitees. Tenant shall promptly replace all scratched, damaged or
broken doors and glass in and about the Demised Premises and shall be
responsible for all repairs, maintenance and replacement of wall and floor
coverings in the Demised Premises and for the repair and maintenance of all
sanitary and electrical fixtures and equipment therein. Tenant shall promptly
make all repairs in or to the Demised Premises for which Tenant is responsible,
and any repairs required to be made by Tenant to the mechanical, electrical,
sanitary, heating, ventilating, air-conditioning or other systems of the
Building shall be performed only by contractor(s) reasonably approved by
Landlord. Any other repairs in or to the
24
Building and the facilities and systems thereof for which Tenant is responsible
shall be performed by Landlord at Tenant's expense; but Landlord may, at its
option, before commencing any such work or at any time thereafter, require
Tenant to furnish to Landlord such security, in form (including, without
limitation, a bond issued by a corporate surety licensed to do business in New
Jersey) and amount, as Landlord shall deem necessary to assure the payment for
such work by Tenant.
17.02. Landlord shall make all structural repairs at Landlord's cost and
expense except to the extent same are Tenant's responsibility as hereinabove
provided in Section 17.01.
17.03. Landlord shall, at Landlord's cost and expense, make all structural
repairs and replacements in and to the roof. Although Tenant's responsibility,
Landlord shall also perform the normal routine maintenance and cleaning to the
roof, the cost of which shall be included in the Operating Expenses.
17.04. Tenant shall not permit or suffer the overloading of the floors of
the Demised Premises beyond two hundred fifty (250) pounds per square foot.
17.05. Except as otherwise expressly provided in this Lease, Landlord shall
have no liability to Tenant, nor shall Tenant's covenants and obligations under
this Lease be reduced or abated in any manner whatsoever, by reason of any
inconvenience, annoyance, interruption or injury to business arising from
Landlord's doing any repairs, maintenance, or changes which Landlord is required
or permitted by this Lease, or required by Law, to make in or to any portion of
the Building.
ARTICLE 18 - UTILITY CHARGES
18.01. Tenant shall pay all charges for gas, water, sewer, electricity,
heat or other utility or service supplied to the Demised Premises as measured by
meters relating to Tenant's use, and any cost of repair, maintenance,
replacement, and reading of any meters measuring Tenant's consumption thereof.
Tenant expressly agrees that Landlord shall not be responsible for the failure
of supply to Tenant of any of the aforesaid, or any other utility service.
Landlord shall not be responsible for any public or private telephone service to
be installed in the space, particularly conduit, if required.
18.02. Tenant's use of electric energy in the Demised Premises shall not at
any time exceed the capacity of any of the electrical conductors and equipment
in or otherwise serving the Demised Premises. In order to insure that such
capacity is not exceeded and to avert any material adverse effect upon the
Building's electric service, Tenant shall not, without Landlord's prior consent
in each instance (which shall not be unreasonably withheld), connect any
fixtures, appliances or equipment to the Building's electric distribution system
or make any alteration or addition to the electric system of the Demised
Premises existing on the Commencement Date. Should Landlord grant such consent,
all additional risers or other equipment required therefor
25
shall be provided by Landlord and the cost thereof shall be paid by Tenant to
Landlord on demand.
ARTICLE 19 - ACCESS, CHANGES AND NAME
19.01. Except for the space within the inside surfaces of all walls, hung
ceilings, floors, windows and doors bounding the Demised Premises, all of the
Building, including, without limitation, exterior Building walls, core corridor
walls and doors and any core corridor entrance, any terraces or roofs adjacent
to the Demised Premises, and any space in or adjacent to the Demised Premises
used for shafts, stacks, pipes, conduits, fan rooms, ducts, electric or other
utilities, sinks or other Building facilities and the use thereof, as well as
access thereto through the Demised Premises for the purpose of operating,
maintenance, decoration and repair, are reserved to Landlord. Landlord also
reserves the right, to install, erect, use and maintain pipes, ducts and
conduits in and through the Demised Premises, provided (i) such are properly
enclosed, (ii) same do not materially interfere with Tenant's use and occupancy
of the Demised Premises, and (iii) Landlord shall use best efforts to locate
same in "back-room" areas, closets and the like.
19.02. Landlord and its agents shall have the right to enter and/or pass
through the Demised Premises at any time or times upon reasonable prior notice
to Tenant and accompanied by a representative of Tenant (unless in the event of
an emergency when the circumstances shall dictate the nature and extent of
notice), (a) to examine the Demised Premises and to show then to actual and
prospective Superior Lessors, Superior Mortgagees, or prospective purchasers of
the Building, and (b) to make such repairs, alterations, additions and
improvements in or to the Demised Premises and/or in or to the Building or its
facilities and equipment as Landlord is required or reasonably desires to make;
provided, however, Landlord agrees, in connection with such repairs,
alterations, additions and improvements, to use its best efforts not to
materially interfere with Tenant's use and occupancy of the Demised Premises.
Landlord shall be allowed to take all materials into and upon the Demised
Premises that may be required in connection therewith, without any liability to
Tenant and without any reduction of Tenant's obligations hereunder. During the
period of nine (9) months prior to the Expiration Date, Landlord and its agents
may exhibit the Demised Premises to prospective tenants.
19.03. If at any time any windows of the Demised Premises are temporarily
darkened or obstructed by reason of any repairs, improvements, maintenance
and/or cleaning in or about the Building, or if any part of the Building or the
Common Areas, other than the Demised Premises, is temporarily or permanently
closed or inoperable, the same shall not be deemed a constructive eviction and
shall not result in any reduction or diminution of Tenant's obligations under
this Lease.
ARTICLE 20 - MECHANICS' LIENS AND OTHER LIENS
20.01. Nothing contained in this Lease shall be deemed, construed or
interpreted to imply any consent or agreement on the part of Landlord to
26
subject Landlord's interest or estate to any liability under any mechanic's or
other lien law. If any mechanic's or other lien or any notice of intention to
file a lien is filed against the Land, or any part thereof, or the Demised
Premises, or any part thereof, for any work, labor, service or materials claimed
to have been performed or furnished for or on behalf of Tenant or anyone holding
any part of the Demised Premises through or under Tenant, Tenant shall cause the
same to be canceled and discharged of record by payment, bond or order of a
court of competent jurisdiction within thirty (30) days after notice by Landlord
to Tenant.
ARTICLE 21 - NON-LIABILITY AND INDEMNIFICATION
21.01. Neither Landlord nor any partner, joint venturer, director, officer,
agent, servant or employee of Landlord shall be liable to Tenant for any loss,
injury or damage to Tenant or to any other Person, or to its or their property,
irrespective of the cause of such injury, damage or loss, unless caused by or
resulting from the negligence of Landlord, its agents, servants or employees in
the operation or maintenance of the Land or Building. Further, neither Landlord
nor any partner, joint venturer, director, officer, agent, servant or employee
of Landlord shall be liable (a) for any such damage caused by other tenants or
Persons in, upon or about the Land or Building, or caused by operations in
construction of any private, public or quasi-public work; or (b) even if
negligent, for consequential damages arising out of any loss of use of the
Demised Premises or any equipment or facilities therein by Tenant or any Person
claiming through or under Tenant.
21.02. Notwithstanding any provision to the contrary, Tenant shall look
solely to the estate and property of Landlord in and to the Land and Building
(or the proceeds received by Landlord on a sale of such estate and property but
not the proceeds of any financing or refinancing thereof) in the event of any
claim against Landlord arising out of or in connection with this Lease, the
relationship of Landlord and Tenant or Tenant's use of the Demised Premises or
the Common Areas, and Tenant agrees that the liability of Landlord arising out
of or in connection with this Lease, the relationship of Landlord and Tenant or
Tenant's use of the Demised Premises or the Common Areas shall be limited to
such estate and property of Landlord (or sale proceeds). No other properties or
assets of Landlord or any partner, joint venturer, director, officer, agent,
servant or employee of Landlord shall be subject to levy, execution or other
enforcement procedures for the satisfaction of any judgement (or other judicial
process) or for the satisfaction of any other remedy of Tenant arising out of,
or in connection with, this Lease, the relationship of Landlord and Tenant or
Tenant's use of the Demised Premises or the Common Areas and if Tenant shall
acquire a lien on or interest in any other properties or assets by judgment or
otherwise, Tenant shall promptly release such lien on or interest in such other
properties and assets by executing, acknowledging and delivering to Landlord an
instrument to that effect prepared by Landlord's attorneys. Tenant hereby waives
the right of specific performance and any other remedy allowed in equity if
specific performance or such other remedy could result in any liability of
Landlord for the payment of money to Tenant, or to any court or governmental
authority (by
27
way of fines or otherwise) for Landlord's failure or refusal to observe a
judicial decree or determination, or to any third party.
ARTICLE 22 - DAMAGE OR DESTRUCTION
22.01. If the Building or the Demised Premises shall be partially or
totally damaged or destroyed by fire or other casualty (and if this Lease shall
not be terminated as in this Article 22 hereinafter provided), Landlord shall
repair the damage and restore and rebuild the Building and/or the Demised
Premises (except for the Tenant's Property) with reasonable dispatch after
notice to it of the damage or destruction and the collection of the insurance
proceeds attributable to such damage.
22.02. Subject to the provisions of Section 22.05, if all or part of the
Demised Premises shall be damaged or destroyed or rendered completely or
partially untenantable on account of fire or other casualty, the Rent shall be
abated or reduced, as the case may be, in the proportion that the untenantable
area of the Demised Premises bears to the total area of the Demised Premises,
for the period from the date of the damage or destruction to (a) the date the
damage to the Demised Premises shall be substantially repaired, or (b) if the
Building and not the Demised Premises is so damaged or destroyed, the date on
which the Demised Premises shall be made tenantable; provided, however, should
Tenant reoccupy a portion of the Demised Premises during the period the repair
or restoration work is taking place and prior to the date that the Demised
Premises are substantially repaired or made tenantable the Rent allocable to
such reoccupied portion, based upon the proportion which the area of the
reoccupied portion of the Demised Premises bears to the total area of the
Demised Premises, shall be payable by Tenant from the date of such occupancy.
22.03. If (a) the Building or the Demised Premises shall be totally damaged
or destroyed by fire or other casualty, or (b) the Building shall be so damaged
or destroyed by fire or other casualty (whether or not the Demised Premises are
damaged or destroyed) that its repair or restoration requires the expenditure,
as estimated by a reputable contractor or architect designated by Landlord, of
more than twenty percent (20%) (or ten percent [10%] if such casualty occurs
during the last two [2] years of the Term) of the full insurable value of the
Building immediately prior to the casualty, or (c) the Building shall be damaged
or destroyed by fire or other casualty (whether or not the Demised Premises are
damaged or destroyed) and either the loss shall not be covered by Landlord's
insurance or the net insurance proceeds (after deducting all expenses in
connection with obtaining such proceeds) shall, in the estimation of a reputable
contractor or architect designated by Landlord be insufficient to pay for the
repair or restoration work, then in either such case Landlord may terminate this
Lease by giving Tenant notice to such effect within ninety (90) days after the
date of the fire or other casualty.
22.04. Except as provided in Article 22.07 hereinbelow, Tenant shall not be
entitled to terminate this Lease and no damages, compensation or claim shall be
payable by Landlord for inconvenience, loss of business or annoyance arising
from any repair or restoration of any portion of the Demised Premises
28
or of the Building pursuant to this Article 22. Landlord shall use its best
efforts to make such repair or restoration promptly and in such manner as not
unreasonably to interfere with Tenant's use and occupancy of the Demised
Premises, but Landlord shall not be required to do such repair or restoration
work except during Landlord's business hours on business days.
22.05. Intentionally omitted.
22.06. Landlord will not carry insurance of any kind on the Tenant's
Property, and, except as provided by law or by reason of Landlord's breach of
any of its obligations hereunder, shall not be obligated to repair any damage to
or replace the Tenant's Property.
22.07. Notwithstanding anything herein contained to the contrary, Landlord
hereby agrees to advise Tenant, within thirty (30) days of the date of any fire
or other casualty, as to whether or not Landlord will be able to restore the
Demised Premises to a tenantable condition within ten (10) months from the date
of the casualty. In the event Landlord advises Tenant that it cannot so restore
the Demised Premises within said ten (10) month period, Tenant shall have the
right to terminate this Lease which right must be exercised within twenty (20)
days of the receipt of Landlord's notice. In the event Landlord advises Tenant
that it is able to restore the Premises within said ten (10) month period, or,
in the event Tenant fails to so advise Landlord within the twenty (20) day
period that it desires to terminate the Lease, then the provisions of Article
22.01 through 22.06 shall control. In the event Landlord advised Tenant it was
able to restore the Demised Premises to a tenantable condition within ten (10)
months from the date of any fire or other casualty, or, in the alternative,
Tenant failed to advise Landlord that it intended to terminate the Lease such
that Landlord commenced restoration of same, and in either such case, Landlord
fails to restore the Premises to a tenantable condition within said ten (10)
month period, Tenant shall have the right to terminate this Lease by delivering
written notice to Landlord to that effect within twenty (20) days of the last
day of said ten (10) month period.
It is specifically agreed by and between the parties hereto that to the extent
there is any fire or other casualty during the last eighteen (18) months of the
Term of the Lease or any extension thereof, and, in Tenant's reasonable business
judgement, it is not able to operate its business at the Demised Premises,
Tenant shall have the right to terminate this Lease by delivering written notice
to Landlord to that effect which termination shall be effective on the date of
Landlord's receipt of such notice.
22.08. The provisions of this Article 22 shall be deemed an express
agreement governing any case of damage or destruction of the Demised Premises
and/or Building by fire or other casualty, and any law providing for such a
contingency in the absence of an express agreement, now or hereafter in force,
shall have no application in such case.
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ARTICLE 23 - EMINENT DOMAIN
23.01 If the whole of the Demised Premises shall be taken by any public or
quasi-public authority under the power of condemnation, eminent domain or
expropriation, or in the event of conveyance of the whole of the Demised
Premises in lieu thereof, this Lease shall terminate as of the day possession
shall be taken by such authority and Landlord shall forthwith, subject to the
provisions of Article 8, return Tenant's Security Deposit and any prepaid
amounts. If 25% or less of the Floor Space of the Demised Premises shall be so
taken or conveyed, this Lease shall terminate only in respect of the part so
taken or conveyed as of the day possession shall be taken by such authority. If
more than 25% of the Floor Space of the Demised Premises shall be so taken or
conveyed, this Lease shall terminate only in respect of the part so taken or
conveyed as of the day possession shall be taken by such authority, but either
party shall have the right, to terminate this Lease upon notice given to the
other party within 30 days after such taking possession. If more than 25% of the
Floor Space of the Building shall be so taken or conveyed, Landlord may, by
notice to Tenant, terminate this Lease as of the day possession shall be taken.
If more than 25% of the Floor Space of the Building shall be so taken or
conveyed, and Tenant, in its reasonable business judgment, is unable to continue
to operate in the Demised Premises, Tenant may, by notice to Landlord, terminate
this Lease as of the day possession shall be taken. If so much of the parking
facilities shall be so taken or conveyed that the number of parking spaces
necessary, in Landlord's reasonable judgment, for the continued operation of the
Building shall not be available, Landlord shall, by notice to Tenant, terminate
this Lease as of the day possession shall be taken. If this Lease shall continue
in effect as to any portion of the Demised Premises not so taken or conveyed,
the Rent shall be computed as of the day possession shall be taken on the basis
of the remaining Floor Space of the Demised Premises. Except as specifically
provided herein, in the event of any such taking or conveyance there shall be no
reduction in Rent. If this Lease shall continue in effect, Landlord shall, at
its expense, but shall be obligated only to the extent of the net award or other
compensation (after deducting all expenses in connection with obtaining same)
available to Landlord for the improvements taken or conveyed (excluding any
award or other compensation for land or for the unexpired portion of the term of
any Superior Lease), make all necessary alterations so as to constitute the
remaining Building a complete architectural and tenantable unit, except for the
Tenant's Property, and Tenant shall make all alterations or replacements to the
Tenant's Property and decorations in the Demised Premises. All awards and
compensation for any taking or conveyance, whether for the whole or a part of
the Land or Building, the Demised Premised or otherwise, shall be the property
of Landlord, and Tenant hereby assigns to Landlord all of Tenant's right, title
and interest in and to any and all such awards and compensation, including,
without limitation, any award or compensation for the value of the unexpired
portion of the Term. Tenant shall be entitled to claim, prove and receive in the
condemnation proceeding such award or compensation as may be allowed for the
Tenant's Property and for loss of business, good will, and depreciation or
injury to and cost of removal of the Tenant's Property, but only if such award
or compensation shall be made by the condemning authority in addition to, and
shall not result in a reduction of, the award or compensation made by it to
Landlord.
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23.02. If the temporary use or occupancy of all or any part of the Demised
Premises shall be taken during the Term, Tenant shall be entitled, except as
hereinafter set forth, to receive that portion of the award or payment for such
taking which represents compensation for the use and occupancy of the Demised
Premises, for the taking of the Tenant's Property and for moving expenses, and
Landlord shall be entitled to receive that portion which represents
reimbursement for the cost of restoration of the Demised Premises. This Lease
shall be and remain unaffected by such taking and Tenant shall continue to be
responsible for all of its obligations hereunder insofar as such obligations are
not affected by such taking and shall continue to pay the Rent in full when due.
If the period of temporary use or occupancy shall extend beyond the Expiration
Date, that part of the award or payment which represents compensation for the
use and occupancy of the Demised Premises (or a part thereof) shall be divided
between Landlord and Tenant so that Tenant shall receive (except as otherwise
provided below) so much thereof as represents compensation for the period up to
and including the Expiration Date and Landlord shall receive so much thereof as
represents compensation for the period after the Expiration Date.
ARTICLE 24 - SURRENDER
24.01. On the Expiration Date, or upon any earlier termination of this
Lease, Tenant shall quit and surrender the Demised Premises to Landlord
"broom-clean" and in good order, condition and repair, except for ordinary wear
and tear and such damage or destruction as Landlord is required to repair or
restore under this Lease, and Tenant shall remove all of Tenant's Property
therefrom except as otherwise expressly provided in this Lease. To the extent
Tenant elects to terminate the Lease in accordance with Article 22.07
hereinabove, Tenant shall have no obligation to surrender the Premises in
accordance with this Article 24.01.
24.02. If Tenant remains in possession of the Demised Premises after the
expiration of the Term, Tenant shall be deemed to be occupying the Demised
Premises as a tenant from month to month at the sufferance of Landlord subject
to all of the provisions of this Lease, except that the monthly Fixed Rent shall
be twice the Fixed Rent in effect during the last month of the Term, plus l/12th
of the average annual Percentage Rent for the immediately preceding three full
Calendar Years (or for the entire Term if less than three full Calendar Years).
24.03. No act or thing done by Landlord or its agents shall be deemed an
acceptance of a surrender of the Demised Premises, and no agreement to accept
such surrender shall be valid unless in writing and signed by Landlord.
ARTICLE 25 - CONDITIONS OF LIMITATION
25.01. This Lease is subject to the limitation that whenever Tenant or any
Guarantor (a) shall make an assignment for the benefit of creditors, or (b)
shall commence a voluntary case or have entered against it an order for
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relief under any chapter of the Federal Bankruptcy Code (Title 11 of the United
States Code) or any similar order or decree under any federal or state law, now
in existence, or hereafter enacted having the same general purpose, and such
order or decree shall have not been stayed or vacated within 30 days after
entry, or (c) shall cause, suffer, permit or consent to the appointment of a
receiver, trustee, administrator, conservator, sequestrator, liquidator or
similar official in any federal, state or foreign judicial or nonjudicial
proceeding, to hold, administer and/or liquidate all or substantially all of its
assets, and such appointment shall not have been revoked, terminated, stayed or
vacated and such official discharged of his duties within 30 days of his
appointment, then Landlord, at any time after the occurrence of any such event,
may give Tenant a notice of intention to end the Term at the expiration of five
(5) days from the date of service of such notice of intention, and upon the
expiration of said five (5) day period, whether or not the Term shall
theretofore have commenced, this Lease shall terminate with the same effect as
if that day were the expiration date of this Lease, but Tenant shall remain
liable for damages as provided in Article 27.
25.02. This Lease is subject to the further limitations that: (a) if Tenant
shall default in the payment of any Rent, and such default shall continue for
five (5) days after notice or (b) if Tenant shall, whether by action or
inaction, be in default of any of its obligations under this Lease (other than a
default in the payment of Rent) and such default shall continue and not be
remedied within fifteen (15) days after Landlord shall have given to Tenant a
notice specifying the same, or, in the case of a default which cannot with due
diligence be cured within a period of fifteen (15) days and the continuance of
which for the period required for cure will not subject Landlord or any Superior
Lessor to prosecution for a crime (as more particularly described in the last
sentence of Section 12.02) or termination of any Superior Lease or foreclosure
of any Superior Mortgage, if Tenant shall not, (i) within said fifteen (15) day
period advise Landlord of Tenant's intention to take all steps necessary to
remedy such default, (ii) duly commence within said fifteen (15) day period, and
thereafter diligently prosecute to completion all steps necessary to remedy the
default, and (iii) complete such remedy within a reasonable time after the date
of said notice by Landlord, or (c) if any event shall occur or any contingency
shall arise whereby this Lease would, by operation of law or otherwise, devolve
upon or pass to any person, firm or corporation other than Tenant, except as
expressly permitted by Article 11, or (d) if Tenant shall abandon the Demised
Premises, then, in any of said cases, Landlord may give to Tenant a notice of
intention to end the Term at the expiration of five (5) days from the date of
the service of such notice of intention, and upon the expiration of said five
(5) days, whether or not the Term shall theretofore have commenced, this Lease
shall terminate with the same effect as if that day were the expiration date of
this Lease, but Tenant shall remain liable for damages as provided in Article
27.
ARTICLE 26 - RE-ENTRY BY LANDLORD
26.01. If this Lease shall terminate as provided in Article 25, Landlord or
Landlord's agents and employees may immediately or at any time
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thereafter re-enter the Demised Premises, or any part thereof, either by summary
dispossess proceedings or by any suitable action or proceeding at law without
being liable to indictment, prosecution or damages therefor, and may repossess
the same, and may remove any Person therefrom, to the end that Landlord may
have, hold and enjoy the Demised Premises. The word "re-enter," as used herein,
is not restricted to its technical legal meaning. If this Lease is terminated
under the provisions of Article 25, or if Landlord shall re-enter the Demised
Premises under the provisions of this Article 26, or in the event of the
termination of this Lease, or of re-entry, by or under any summary dispossess or
other proceedings or action or any provision of law by reason of default
hereunder on the part of Tenant, Tenant shall thereupon pay to Landlord the Rent
payable up to the time of such termination of this Lease, or of such recovery of
possession of the Demised Premises by Landlord, as the case may be, and shall
also pay to Landlord damages as provided in Article 27.
26.02. In the event of a breach by Tenant of any of its obligations under
this Lease, Landlord shall also have the right of injunction. The special
remedies to which Landlord may resort hereunder are cumulative and are not
intended to be exclusive of any other remedies to which Landlord may lawfully be
entitled at any time and Landlord may invoke any remedy allowed at law or in
equity as if specific remedies were not provided for herein.
26.03. If this Lease shall terminate under the provisions of Article 25, or
if Landlord shall re-enter the Demised Premises under the provisions of this
Article 26, or in the event of the termination of this Lease, or of re-entry, by
or under any summary dispossess or other proceeding or action or any provision
of law by reason of default hereunder on the part of Tenant, Landlord shall be
entitled to retain all monies, if any, paid by Tenant to Landlord, whether as
Advance Rent, security or otherwise, but such monies shall be credited by
Landlord against any Rent due from Tenant at the time of such termination or
re-entry or, at Landlord's option, against any damages payable by Tenant under
Article 27 or pursuant to law.
ARTICLE 27 - DAMAGES
27.01. If this Lease is terminated under the provisions of Article 25 or if
Landlord shall re-enter the Demised Premises under the provisions of Article 26,
or in the event of the termination of this Lease, or of re-entry, by or under
any summary dispossess or other proceeding or action or any provision of law by
reason of default hereunder on the part of Tenant, Tenant shall pay as
Additional Charges to Landlord, at the election of Landlord, either or any
combination of:
(a) a sum which at the time of such termination of this Lease or at the
time of any such re-entry by Landlord, as the case may be, represents the then
value of the excess, if any, of (i) the aggregate amount of the Rent which would
have been payable by Tenant (conclusively presuming the average monthly
Percentage Rent and Additional Charges to be the same as were the average
monthly Percentage Rent and Additional Charges payable for the year, or if less
than 365 days have then elapsed since the Commencement Date, the partial year,
immediately preceding such termination or re-entry) for the period
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commencing with such earlier termination of this Lease or the date of any such
re-entry, as the case may be, and ending with the Expiration Date, over (ii) the
aggregate rental value of the Demised Premises for the same period; or
(b) sums equal to the Fixed Rent, Percentage Rent (in the same monthly
amount as the average monthly Percentage Rent payable for the year, or if less
than three hundred sixty five (365) days have then elapsed since the
Commencement Date, the partial year, immediately preceding such termination or
re-entry) and the Additional Charges which would have been payable by Tenant had
this Lease not so terminated, or had Landlord not so re-entered the Demised
Premises, payable upon the due dates therefor specified herein following such
termination or such re-entry and until the Expiration Date, provided, however,
that if Landlord shall relet the Demised Premises during said period, Landlord
shall credit Tenant with the net rents received by Landlord from such reletting,
such net rents to be determined by first deducting from the gross rents as and
when received by Landlord from such reletting the expenses incurred or paid by
Landlord in terminating this Lease or in re-entering the Demised Premises and in
securing possession thereof, as well as the expenses of reletting, including,
without limitation, altering and preparing the Demised Premises for new tenants,
brokers' commissions, reasonable legal fees, and all other expenses properly
chargeable against the Demised Premises and the rental therefrom, it being
understood that any such reletting may be for a period shorter or longer than
the period ending on the Expiration Date; but in no event shall Tenant be
entitled to receive any excess of such net rents over the sums payable by Tenant
to Landlord hereunder, nor shall Tenant be entitled in any suit for the
collection of damages pursuant to this subdivision (b) to a credit in respect of
any rents from a reletting, except to the extent that such net rents are
actually received by Landlord. If the Demised Premises or any part thereof
should be relet in combination with other space, then proper apportionment on a
square foot basis shall be made of the rent received from such reletting and of
the expenses of reletting; or
(c) a sum which at the time of such termination of this Lease or at the
time of any such re-entry by Landlord, as the case may be, represents the
aggregate amount of the Rent which would have been payable by Tenant
(conclusively presuming the average monthly Additional Charges to be the same as
were the average monthly Additional Charges payable for the year, or if less
than 365 days have then elapsed since the Commencement Date, the partial year,
immediately preceding such termination or re-entry) for the period commencing
with such earlier termination of this Lease or the date of any such re-entry, as
the case may be, and ending with the Expiration Date; provided, however, that if
Landlord shall relet the Demised Premises during said period, Landlord shall
credit Tenant with the net rents received by Landlord from such reletting, such
net rents to be determined by first deducting from the gross rents as and when
received by Landlord from such reletting the expenses incurred or paid by
Landlord in terminating this Lease or in re-entering the Demised Premises and in
securing possession thereof, as well as the expenses of reletting, including,
without limitation, altering and preparing the Demised Premises for new tenants,
brokers' commissions, reasonable legal fees, and all other expenses properly
chargeable against the Demised Premises and the rental therefrom, it being
understood that any such reletting may be for
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a period shorter or longer than the period ending on the Expiration Date; but in
no event shall Landlord have to account to Tenant for any rents in excess of the
total damages recovered by Landlord hereunder, nor shall Tenant be entitled in
any suit for the collection of damages pursuant to this subdivision (c) to a
credit in respect of any rents from a reletting, except to the extent that such
net rents are actually received by Landlord. If the Demised Premises or any part
thereof should be relet in combination with other space, then proper
apportionment on a square foot basis shall be made of the rent received from
such reletting and of the expenses of reletting.
Landlord shall not be liable in any way whatsoever for its failure or refusal to
relet the Demised Premises or any part thereof, or if the Demised Premises or
any part thereof are relet, for its failure to collect the rent under such
reletting, and no such refusal or failure to relet or failure to collect rent
shall release or affect Tenant's liability for damages or otherwise under this
Lease.
27.02. Suit or suits for the recovery of such damages or, any installments
thereof, may be brought by Landlord at any time and from time to time at its
election, and nothing contained herein shall be deemed to require Landlord to
postpone suit until the date when the Term would have expired if it had not been
so terminated under the provisions of Article 25, or under any provision of law,
or had Landlord not re-entered the Demised Premises. Nothing herein contained
shall be construed to limit or preclude recovery by Landlord against Tenant of
any sums or damages to which, in addition to the damages particularly provided
above, Landlord may lawfully be entitled by reason of any default hereunder on
the part of Tenant. Nothing herein contained shall be construed to limit or
prejudice the right of Landlord to prove for and obtain as damages by reason of
the termination of this Lease or re-entry of the Demised Premises for the
default of Tenant under this Lease, an amount equal to the maximum allowed by
any statute or rule of law in effect at the time, whether or not such amount be
greater than, equal to, or less than any of the sums referred to in Section
27.01.
27.03. In addition, if this Lease is terminated under the provisions of
Article 25, Tenant covenants that: (a) the Demised Premises then shall be in the
same condition as that in which Tenant has agreed to surrender the same to
Landlord at the Expiration Date; (b) Tenant shall have performed prior to any
such termination any obligation of Tenant contained in this Lease for the making
of any alteration or for restoring or rebuilding the Demised Premises or the
Building, or any part thereof; and (c) for the breach of any covenant of Tenant
set forth above in this Section 27.03, Landlord shall be entitled immediately,
without notice or other action by Landlord, to recover, and Tenant shall pay, as
and for liquidated damages therefor, the reasonable cost of performing such
covenant (as estimated by an independent contractor selected by Landlord).
27.04. In addition to any other remedies Landlord may have under this
Lease, and without reducing or adversely affecting any of Landlord's rights and
remedies under this Article 27, if any Rent or damages payable hereunder by
Tenant to Landlord are not paid within five (5) days after demand therefor, the
same shall bear interest at the Late Payment Rate or the maximum rate
35
permitted by law, whichever is less, from the due date thereof until paid, and
the amounts of such interest shall be Additional Charges hereunder.
ARTICLE 28 - AFFIRMATIVE WAIVERS
28.01. Tenant, on behalf of itself and any and all persons claiming through
or under Tenant, does hereby waive and surrender all right and privilege which
it, they or any of them might have under or by reason of any present or future
law, to redeem the Demised Premises or to have a continuance of this Lease after
being dispossessed or ejected from the Demised Premises by process of law or
under the terms of this Lease or after the termination of this Lease as provided
in this Lease.
28.02. Landlord and Tenant hereby waive trial by jury in any action,
proceeding or counterclaim brought by either against the other on any matter
whatsoever arising out of or in any way connected with this Lease, the
relationship of Landlord and Tenant, and Tenant's use or occupancy of the
Demised Premises and use of the Common Area, including, without limitation, any
claim of injury or damage, and any emergency and other statutory remedy with
respect thereto. Tenant shall not interpose any counterclaim of any kind, except
compulsory counterclaims as permitted by applicable Court Rule, in any action or
proceeding commenced by Landlord to recover possession of the Demised Premises.
ARTICLE 29 - NO WAIVERS
29.01. The failure of either party to insist in any one or more instances
upon the strict performance of any one or more of the obligations of this Lease,
or to exercise any election herein contained, shall not be construed as a waiver
or relinquishment for the future of the performance of such one or more
obligations of this Lease or of the right to exercise such election, but the
same shall continue and remain in full force and effect with respect to any
subsequent breach, act or omission. The receipt by Landlord of Fixed Rent,
Percentage Rent or Additional Charges with knowledge of breach by Tenant of any
obligation of this Lease shall not be deemed a waiver of such breach.
ARTICLE 30 - CURING LANDLORD'S/TENANT'S DEFAULTS
30.01. If Tenant shall default in the performance of any of Tenant's
obligations under this Lease, Landlord, without thereby waiving such default,
may (but shall not be obligated to) perform the same for the account and at the
expense of Tenant, without notice in a case of emergency, and in any other case
only if such default continues after the expiration of fifteen (15) days from
the date Landlord gives Tenant notice of the default. Bills for any expenses
incurred by Landlord in connection with any such performance by it for the
account of Tenant, and bills for all costs, expenses and disbursements of every
kind and nature whatsoever, including reasonable attorneys' fees and
36
expenses, involved in collecting or endeavoring to collect the Rent or any part
thereof or enforcing or endeavoring to enforce any rights against Tenant or
Tenant's obligations hereunder, under or in connection with this Lease or
pursuant to law, including any such cost, expense and disbursement involved in
instituting and prosecuting summary proceedings or in recovering possession of
the Demised Premises after default by Tenant or upon the expiration of the Term
or sooner termination of this Lease, and interest on all sums advanced by
Landlord under this Article at the Late Payment Rate or the maximum rate
permitted by law, whichever is less, may be sent by Landlord to Tenant monthly,
or immediately, at Landlord's option, and such amounts shall be due and payable
in accordance with the terms of such bills.
30.02. If Landlord shall default in the performance of any of Landlord's
obligations under this Lease, Tenant, without thereby waiving such default, may
(but shall not be obligated to) perform the same for the account and at the
expense of Landlord, without notice in a case of emergency, and in any other
case only if such default continues after the expiration of thirty (30) days
from the date Tenant gives Landlord notice of the default. Bills for any
expenses incurred by Tenant in connection with any such performance by it for
the account of Landlord, may be sent by Tenant to Landlord monthly, or
immediately, at Tenant's option, and such amounts shall be due and payable in
accordance with the terms of such bills, but in no event shall any such bill be
due and payable less than thirty (30) days from the date of such bills.
ARTICLE 31 - BROKER
31.01. Landlord and Tenant represent to each other that no broker except
the Broker was instrumental in bringing about or consummating this Lease and
that neither party had any conversations or negotiations with any broker except
the Broker concerning the leasing of the Demised Premises. Landlord and Tenant
agree to indemnify and hold the other harmless against and from any claims for
any brokerage commissions and all costs, expenses and liabilities in connection
therewith, including, without limitation, attorneys' fees and expenses, arising
out of any conversations or negotiations had by Landlord or Tenant, or as the
case may be, with any broker other than the Broker. Landlord shall pay any
brokerage commission due the Broker pursuant to a separate agreement between
Landlord and the Broker.
ARTICLE 32 - NOTICES
32.01. Any notice, statement, demand, consent, approval or other
communication required or permitted to be given, rendered or made by either
party to the other, pursuant to this Lease or pursuant to any applicable Legal
Requirement, shall be in writing and shall be deemed to have been properly
given, rendered or made only if hand delivered or sent by United States
registered or certified mail, return receipt requested, addressed to the other
party at the address hereinabove set forth with copies, as to Tenant, to:
Fulbright and Jaworski, 666 Fifth Avenue, New York, New York 10103, Attention:
Neil Gold, Esq., and to the Guarantor at the address set forth in the
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Guaranty, Attention: Chief Financial Officer; and as to Landlord, to the
attention of General Counsel with a concurrent notice to the attention of
Controller, and shall be deemed to have been given, rendered or made (i) if
mailed, on the second day after the day so mailed, unless mailed outside the
State of New Jersey, in which case it shall be deemed to have been given,
rendered or made on the third business day after the day so mailed, and (ii) if
hand delivered, on the date delivered. Either party may, by notice as aforesaid,
designate a different address or addresses for notices, statements, demands,
consents, approvals or other communications intended for it.
ARTICLE 33 - ESTOPPEL CERTIFICATES
33.01. Each party shall, at any time and from time to time, as requested by
the other party, upon not less than ten (10) days' prior notice, execute and
deliver to the requesting party a statement certifying that this Lease is
unmodified and in full force and effect (or if there have been modifications,
that the same is in full force and effect as modified and stating the
modifications), certifying the dates to which the Fixed Rent and Additional
Charges have been paid, stating whether or not, to the best knowledge of the
party giving the statement, the requesting party is in default in performance of
any of its obligations under this Lease, and, if so, specifying each such
default of which the party giving the statement shall have knowledge, and
stating whether or not, to the best knowledge of the party giving the statement,
any event has occurred which with the giving of notice or passage of time, or
both, would constitute such a default of the requesting party, and, if so,
specifying each such event; any such statement delivered pursuant hereto shall
be deemed a representation and warranty to be relied upon by the party
requesting the certificate and by others with whom such party may be dealing,
regardless of independent investigation. Tenant also shall include in any such
statement such other information concerning this Lease as Landlord may
reasonably request.
ARTICLE 34 - ARBITRATION
34.01. Landlord may at any time request arbitration, and Tenant may at any
time when not in default in the payment of any Rent request arbitration, of any
matter in dispute but only where arbitration is expressly provided for in this
Lease. The party requesting arbitration shall do so by giving notice to that
effect to the other party, specifying in said notice the nature of the dispute,
and said dispute shall be determined in Newark, New Jersey, by a single
arbitrator, in accordance with the rules then obtaining of the American
Arbitration Association (or any organization which is the successor thereto).
The award in such arbitration may be enforced on the application of either party
by the order or judgment of a court of competent jurisdiction. The fees and
expenses of any arbitration shall be borne by the parties equally, but each
party shall bear the expense of its own attorneys and experts and the additional
expenses of presenting its own proof. If Tenant gives notice requesting
arbitration as provided in this Article, Tenant shall simultaneously serve a
duplicate of the notice on each Superior Mortgagee and Superior Lessor whose
name and address shall previously have been furnished
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to Tenant by Landlord in writing, and such Superior Mortgagees and Superior
Lessor shall have the right to participate in such arbitration.
ARTICLE 35 - MEMORANDUM OF LEASE
35.01. Neither party shall record this Lease. However, at the request of
either party, the other party shall promptly execute, acknowledge and deliver to
the requesting party a memorandum of lease in respect of this Lease sufficient
for recording. Such memorandum shall not be deemed to change or otherwise affect
any of the obligations or provisions of this Lease. Whichever party requests
such memorandum of Lease shall pay all recording costs and expenses, including
any taxes that are due upon such recording.
ARTICLE 36 - MISCELLANEOUS
36.01. Tenant expressly acknowledges and agrees that Landlord has not made
and is not making, and Tenant, in executing and delivering this Lease, is not
relying upon, any warranties, representations, promises or statements, except to
the extent that the same are expressly set forth in this Lease or in any other
written agreement(s) which may be made between the parties concurrently with the
execution and delivery of this Lease. All understandings and agreements
heretofore had between the parties are merged in this Lease and any other
written agreement(s) made concurrently herewith, which alone fully and
completely express the agreement of the parties and which are entered into after
full investigation. Neither party has relied upon any statement or
representation not embodied in this Lease or in any other written agreement(s)
made concurrently herewith.
36.02. No agreement shall be effective to change, modify, waive, release,
discharge, terminate or effect an abandonment of this Lease, in whole or in
part, unless such agreement is in writing, refers expressly to this Lease and is
signed by the party against whom enforcement of the change, modification,
waiver, release, discharge, termination or effectuation of abandonment is
sought.
36.03. If Tenant shall at any time request Landlord to sublet or let the
Demised Premises for Tenant's account, Landlord or its agent is authorized to
receive keys for such purposes without releasing Tenant from any of its
obligations under this Lease, and Tenant hereby releases Landlord of any
liability for loss or damage to any of the Tenant's Property in connection with
such subletting or letting.
36.04. Except as otherwise expressly provided in this Lease, the
obligations under this Lease shall bind and benefit the successors and assigns
of the parties hereto with the same effect as if mentioned in each instance
where a party is named or referred to; provided, however, that (a) no violation
of the provisions of Article 11 shall operate to vest any rights in any
successor or assignee of Tenant and (b) the provisions of this Section
39
36.04 shall not be construed as modifying the conditions of limitation contained
in Article 25.
36.05. Except for Tenant's obligations to pay Rent, the time for Landlord
or Tenant, as the case may be, to perform any of its respective obligations
hereunder shall be extended if and to the extent that the performance thereof
shall be prevented due to any Unavoidable Delay. Except as expressly provided to
the contrary, the obligations of Tenant hereunder shall not be affected,
impaired or excused, nor shall Landlord have any liability whatsoever to Tenant,
(a) because Landlord is unable to fulfill, or is delayed in fulfilling, any of
its obligations under this Lease due to any of the matters set forth in the
first sentence of this Section 36.05, or (b) because of any failure or defect in
the supply, quality or character of electricity, water or any other utility or
service furnished to the Demised Premises for any reason beyond Landlord's
reasonable control.
36.06. Any liability for payments hereunder (including, without limitation,
Additional Charges) shall survive the expiration of the Term or earlier
termination of this Lease.
36.07. INTENTIONALLY OMITTED.
36.08. If an excavation shall be made upon land adjacent to or under the
Building, or shall be authorized to be made, Tenant shall afford to the Person
causing or authorized to cause such excavation, license to enter the Demised
Premises for the purpose of performing such work as said Person shall reasonably
deem necessary or desirable to preserve and protect the Building from injury or
damage and to support the same by proper foundations, without any claim for
damages or liability against Landlord and without reducing or otherwise
affecting Tenant's obligations under this Lease.
36.09. Tenant shall not exercise its rights under Article 15 or any other
provision of this Lease in a manner which would violate Landlord's union
contracts or create any work stoppage, picketing, labor disruption or dispute or
any interference with the business of Landlord or any tenant or occupant of the
Building.
36.10. If known to Tenant, or if Tenant could have reasonably known of
same, Tenant shall give prompt notice to Landlord of (a) any occurrence in or
about the Demised Premises for which Landlord might be liable, (b) any fire or
other casualty in the Demised Premises, (c) any damage to or defect in the
Demised Premises, including the fixtures and equipment thereof, for the repair
of which Landlord might be responsible, and (d) any damage to or defect in any
part of the Building's sanitary, electrical, heating, ventilating, air-
conditioning, elevator or other systems located in or passing through the
Demised Premises or any part thereof.
36.11. This Lease shall be governed by and construed in accordance with the
laws of the State of New Jersey. If any provision of this Lease shall be invalid
or unenforceable, the remainder of this Lease shall not be affected and shall be
enforced to the extent permitted by law. The table of contents,
40
captions, headings and titles in this Lease are solely for convenience of
reference and shall not affect its interpretation. This Lease shall be construed
without regard to any presumption or other rule requiring construction against
the party causing this Lease to be drafted. If any words or phrases in this
Lease shall have been stricken out or otherwise eliminated, whether or not any
other words or phrases have been added, this Lease shall be construed as if the
words or phrases so stricken out or otherwise eliminated were never included in
this Lease and no implication or inference shall be drawn from the fact that
said words or phrases were so stricken out or otherwise eliminated. Each
covenant, agreement, obligation or other provision of this Lease on Tenant's
part to be performed, shall be deemed and construed as a separate and
independent covenant of Tenant, not dependent on any other provision of this
Lease. All terms and words used in this Lease, regardless of the number or
gender in which they are used, shall be deemed to include any other number and
any other gender as the context may require.
36.12. Landlord represents and warrants that (a) Landlord is the sole owner
of the Building, (b) Landlord has the full power and authority to enter into
this Lease, and (c) no other party shall have any right to use or occupy the
Demised Premises by lease or otherwise as of the Commencement Date.
36.13. Tenant represents and warrants that Tenant has the full power and
authority to enter into this Lease, and undertake the obligations of Tenant
hereunder.
36.14. Within thirty (30) days of each anniversary date of this Lease,
Tenant shall annually furnish to Landlord a copy of its then current audited
financial statement which shall be employed by Landlord for purposes of
financing the Premises and not distributed otherwise without prior authorization
of Tenant.
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease as of
the day and year first above written.
("Landlord")
HARTZ MOUNTAIN ASSOCIATES
BY: HARTZ MOUNTAIN INDUSTRIES, INC.
("general partner")
BY: /s/ Vincent J. Rubino, Jr.
------------------------------------
[Corporate Seal] Vincent J. Rubino, Jr.
Vice President
("Tenant")
G-III LEATHER FASHIONS
BY: /s/ Alan Feller
------------------------------------
[Corporate Seal] Name: Alan Feller
Title: Secretary/Treasurer
41
091693
090993
RIDER TO LEASE DATED September 21st, 1993 BETWEEN HARTZ MOUNTAIN ASSOCIATES, AS
LANDLORD AND G-III LEATHER FASHIONS, AS TENANT.
Rl. If any of the provisions of this Rider shall conflict with any of the
provisions, printed or typewritten, of this Lease, such conflict shall resolve
in every instance in favor of the provisions of this Rider.
R2. Provided Tenant is not in default of any of the material terms and
conditions of the Lease, Tenant shall have two (2) successive options to extend
the Term of its lease of the Demised Premises, from the date upon which this
Lease would otherwise expire for two separate extended periods of five (5) years
each ("Extended Period"), the first of which is called the "First Extended
Period" and the second is called the "Second Extended Period", upon the
following terms and conditions:
1. If Tenant elects to exercise any one or both of said options, it shall
do so by giving notice of such election to Landlord on or before the date which
is nine (9) months before the beginning of the Extended Period for which the
Term is to be extended by the exercise of such option. Tenant agrees that it
shall have forever waived its right to exercise any such option if it shall fail
for any reason whatsoever to give such notice to Landlord by the time provided
herein for the giving of such notice, whether such failure is inadvertent or
intentional, time being of the essence as to the exercise of each such option.
2. If Tenant elects to exercise any one or both of said options, the Term
shall be automatically extended for the Extended Period covered by the option so
exercised without execution of an extension or renewal lease. Within ten (10)
days after request of either party following the effective exercise of any such
option, however, Landlord and Tenant shall execute, acknowledge and deliver to
each other duplicate originals of an instrument in recordable form confirming
that such option was effectively exercised.
3. Each Extended Period shall be upon the same terms and conditions as are
in effect immediately preceding the commencement of such Extended Period;
provided, however, that Tenant shall have no right or option to extend the Term
for any period of time beyond the expiration of the Second Extended Period and,
provided further, that in the Extended Period(s) the Fixed Rent shall be as
follows:
-1-
(a) The Fixed Rent during the First Extended Period shall be
Ninety-five percent (95%) of Fair Market Value ("FMV"). FMV shall be determined
by mutual agreement of the parties. If the parties are unable to agree on the
FMV, the parties shall choose a licensed Real Estate Appraiser who shall
determine the FMV. The cost of said Real Estate Appraiser shall be borne equally
by the parties. If the parties are unable to agree on a licensed Real Estate
Appraiser, each party shall select one Appraiser to appraise the FMV. If the
difference between the two appraisals is 20% or less of the lower appraisal,
then the FMV shall be the average of the two appraisals. If the difference
between the two appraisals is greater than 20% of the lower appraisal, the two
Appraisers shall select a third licensed Real Estate Appraiser to appraise the
FMV. The FMV shall in such case be the average of the three appraisals. The cost
of the third appraisal shall be borne equally by the parties. It is expressly
agreed by the parties hereto that the appraisals performed hereunder for the
purposes of calculating FMV shall value the Building without consideration of
the material handling equipment installed by Tenant.
(b) The Fixed Rent during the Second Extended Period shall be
Ninety-five percent (95%) of FMV.
Anything to the contrary contained herein notwithstanding, the Fixed Rent for
such First or Second Extended Period shall not be less than the Fixed Rent for
the period immediately preceding the Extended Period for which the Fixed Rent is
being calculated.
4. Any termination, expiration, cancellation or surrender of this Lease
shall terminate any right or option for the Extended Period(s) not yet
exercised.
5. Landlord shall have the right, for thirty (30) days after receipt of
notice of Tenant's election to exercise any option to extend the Term, to reject
Tenant's election if Tenant gave such notice while Tenant was in default in the
performance of any of its obligations under the Lease, and such rejection shall
automatically render Tenant's election to exercise such option null and void and
of no effect.
6. The options provided herein to extend the Term of the Lease may not be
severed from the Lease or separately sold, assigned or otherwise transferred.
-2-
R3. Notwithstanding anything contained in Article 1.01H to the contrary,
Tenant's obligation to make payment of Rent (exclusive of utilities for which
Tenant shall be obligated) hereunder shall commence on February 1, 1994.
("Landlord")
HARTZ MOUNTAIN ASSOCIATES
By: HARTZ MOUNTAIN INDUSTRIES, INC.
("general partner")
By: /s/ Vincent J. Rubino, Jr.
------------------------------------
Vincent J. Rubino, Jr.
Vice President
("Tenant")
G-III LEATHER FASHIONS
By: /s/ Alan Feller
------------------------------------
Name: Alan Feller
Title: Secretary/Treasurer
-3-
EXHIBIT 10.6(a)
May 27, 1999
VIA HAND DELIVERY
Hartz Mountain Associates
400 Plaza Drive
Secaucus, New Jersey 07094-3688
Attn: General Counsel
Re: Lease Renewal - G-III Leather Fashions, Inc. and Hartz Mountain Associates
Dear Sir:
In accordance with our lease dated September 21st, 1993, for 1000 Secaucus Road,
Secaucus, New Jersey, G-III Leather Fashions, Inc. is exercising its option to
extend the term for the five year period March 1, 2000 to February 28, 2005 (the
First Extended Period).
In accordance with the discussion between Ernie Christoph, of your office, and
Sam Deutscher (V.P. Operations of G-III) the new fixed rent will be as follows:
PERIOD AMOUNT
- --------------------------------- -------------
March 1, 2000 - February 28, 2001 $5.50 sq. ft.
March 1, 2001 - February 28, 2002 $5.50 sq. ft.
March 1, 2002 - February 28, 2003 $5.75 sq. ft.
March 1, 2003 - February 28, 2004 $6.00 sq. ft.
March 1, 2004 - February 28, 2005 $6.00 sq ft.
Very truly yours,
G-III Leather Fashions, Inc.
By: /s/ Wayne S. Miller Accepted by: /s/ Ernie Christoph
----------------------- -------------------------------
Wayne S. Miller Ernie Christoph
Chief Financial Officer Senior Vice President Leasing
Hartz Mountain Associates
cc: Controller, Hartz Mountain Associates
Neil Gold, Fulbright & Jaworski
Doug Danzig, Fulbright & Jaworski
Sam Deutscher
Phil Litwinoff
Agreement of Trust, made as of this day of June 1993
between 512 SEVENTH AVENUE ASSOCIATES a partnership
having offices in care of Helmsley Spear Inc., 512
SEVENTH AVENUE party of the first part hereinafter
referred to as "Landlord" or "Lessor" and
G-III LEATHER FASHIONS, INC.
a domestic corporation having offices at New York City party of the second part
hereinafter referred to as "Tenant" or "Lessee".
Witnesseth: Landlord hereby leases to Tenant and Entire 34th &
Tenant hereby hires from Landlord the space on the floor, 35th Floors
as more particularly shown on the plan annexed hereto and
made a part hereof, in the building known as 512 Seventh
Avenue in the Borough of Manhattan, City of New York, for
the term of 9 yrs, 7 mos, (or until such term shall
sooner cease and expire as hereinafter provided) to
commence on the 1st day of July 1993 and to end on the
31st day of January 2003 both dates inclusive at an
annual rent of $318,720.00 which Tenant agrees to pay in
lawful money of the United States which shall be legal
tender in payment of all debts and dues, public and
private, at the time of payment, in equal monthly
installments of $26,560.00 in advance on the first day of
each month during said term, at the office of Landlord or
such other place as Landlord may designate, without any
set off or deduction whatsoever, except that Tenant shall
pay the first monthly installment(s) on the execution
hereof (unless this lease be a renewal).
The parties hereto for themselves, their heirs,
distributees, executors, administrators, legal
representatives, successors and assigns, hereby covenant
and agree as follows:
FIRST:- Tenant Shall pay the rent and additional RENT
rent as above and as hereinafter provided.
SECOND:-(a) Tenant shall pay to Landlord, as ADDITIONAL
additional rent hereunder. In advance, on the first day RENT
of each and every month during the term hereof, all sums
expended by Landlord and or which become due to Landlord
under this lease and under any collateral agreements
relating to the premises. Tenant's use and occupancy
thereof the supplying by Landlord to Tenant of any
services in connection therewith, together with any fines
or penalties imposed or assessed by any governmental
authority by reason of Tenant's failure to comply with
its requirements.
(b) If Tenant shall default in the observance or
performance of any term or covenant on Tenant's part to
be observed or performed under or by virtue of any of the
terms or provisions in any paragraph of this lease.
Landlord may immediately or at any time thereafter and
without notice perform the same for the account of
Tenant, and if Landlord makes any expenditures or incurs
any obligations for the payment of money in connection
therewith including, but not limited to attorneys' fees
in instituting, prosecuting or defending any action or
proceeding, such sums paid or obligations incurred with
interest and costs shall be deemed to be additional rent
hereunder.
(c) The receipt by Landlord at any term of any
installment of the regular stipulated rent hereunder or
of any additional rent shall not be deemed to be a waiver
of any other additional rent then due. For the
non-payment of any additional rent. Landlord shall have
all the rights and remedies which it would have in the
case of a default in the payment of the regular
stipulated rent hereunder or any installment thereof.
THIRD:- In the event that, at the commencement of RENT DUE
the term of this lease, or thereafter. Tenant shall be in UNDER OTHER
default in the payment of rent to Landlord pursuant to LEASE AS
the terms of another lease with Landlord or with ADDITIONAL
Landlord's predecessor in interest. Landlord may, at RENT
Landlord's option and without notice to Tenant, add the
amount of such arrearages to any monthly installment of
rent payable hereunder, and the same shall be payable to
Landlord as additional rent.
FOURTH:- Tenant shall use and occupy the demised USE
premises for Showroom, office, design & sale at wholesale
and not retail of apparel.
and for no other purpose. Tenant shall not suffer or
permit the demised premises or any part thereof to be
used by others for any purpose whatsoever, without the
prior written consent of landlord in each instance.
REQUIREMENTS FIFTH:- Tenant at its sole expense shall comply with
OF LAW all laws, orders and regulations of Federal State County
and Municipal Authorities, and with any direction of any
public officer or officers, pursuant to law which shall
impose any violation order or duty upon Landlord or
Tenant with respect to demised premises, or the use or
occupation thereof*Tenant shall not do or permit to be
done any act or thing upon said premises which shall or
might subject Landlord to any liability or responsibility
for injury to any person or persons or to property by
reason of any business or operation being earned on upon
said premises or for any other reason.
CERTIFICATE SIXTH:- Tenant will not at any time use or occupy
OF the demised premises in violation of the certificate of
OCCUPANCY occupancy or certificate of compliance issued for the
building of which the demised premises form a part, and
in the event that any department of the City or State of
New York shall hereafter at any time contend and or
declare by notice, violation, order or in any other
manner whatsoever that the premises hereby demised are
used for a purpose which is a violation of such
certificate of occupancy. Tenant shall, upon five (5)
days' written notice from Landlord, immediately
discontinue said use of such premises. Failure by Tenant
to discontinue such use after such notice: shall be
considered a default in the fulfillment of a covenant of
this lease, and Landlord shall have the right to
terminate this lease immediately, and in addition thereto
shall have the right to exercise any and all rights and
privileges and remedies given to Landlord by and pursuant
to the provisions of Paragraph 40 hereof. The statement
in this lease of the nature of the business to be
conducted by Tenant in demised premises shall not be
deemed or construed to constitute a representation or
guaranty by Landlord that such business may continue to
be conducted in the premises for the entire period of the
lease or is lawful or permissible under the certificate
of occupancy in effect for the building of which the
demised premises form a part or otherwise permitted by
law. If alterations or additions, including but not
limited to a sprinkler system are needed to permit lawful
conduct of Tenant's business or to comply with the
certificate of occupancy, the same shall be made by and
at the sole expense of Tenant.
NON- SEVENTH:- Tenant shall not suffer any act to be done
HAZARDOUS or any condition to exist on the demised premises or any
USES part thereof or any article to brought thereon, which may
be dangerous, unless safeguarded as required by law or by
any insurance carrier having any interest in such conduct
or condition or which may in law constitute a nuisance,
public or private, and as not to make void or voidable
any insurance applicable to the building, under penalty
of damages and forfeiture.
SAFETY EIGHTH:- Tenant shall not at any time allow smoking
PRECAUTIONS on any part of the premises where stock is stored. Tenant
shall store all silk and other textiles in steel bins or
shelving, the bottoms of which shall be at least six
inches above the floor, and the tops of which shall
extend at least three inches and shall have drip points
so as to shed water from the goods. No shelving bins
shall be installed without Landlord's prior written
consent. Tenant shall make all floors water-tight by
painting or covering them with linoleum or other
water-light floor covering. Where cleaning fluid is used,
it shall be non-inflammable. Tenant shall use no cleaning
fluid not approved in writing by Landlord. Tenant will
not permit the accumulation of waste or refuse matter on
the premises.
TENANT NINTH:- Tenant will conduct its business in such a
TO KEEP manner as to enable Landlord or other tenants in the
INSURANCE building to obtain the lowest possible insurance rate
RATE LOW upon the entire building in which the demised premises
are located, and will, at its sole expense, comply with
all rules, orders, regulations or requirements of all
public liability, fire and insurance policies in force at
any time with respect to the demised premises, as well as
all rules, orders, regulations or requirements of the New
York Board of Fire Underwriters or any other similar
body, and shall not do or permit anything to be done in
or upon said premises or bring or keep anything therein,
except as now or hereafter permitted by the Fire
Department. Board of Fire Underwriters. Fire Insurance
Rating Organization, or other authority having
jurisdiction and then only in such quantity and manner of
storage as not to increase the rate for fire insurance
applicable to the building, or use the premises in a
manner which shall increase the rate of fire insurance on
the building of which demised premises form a part, or on
property located therein, over that in effect prior to
this lease. If by reason of failure of Tenant to comply
with the provisions of this paragraph including, but not
limited to the mere use to which Tenant puts the
premises, the fire insurance rate shall at the beginning
of this lease or at any time thereafter be higher than it
otherwise would be then Tenant shall reimburse Landlord,
as additional rent hereunder for that part of all fire
insurance premiums thereafter paid by Landlord, which
shall have been charged because of such failure or use by
Tenant, and shall make such reimbursement upon the first
day of the month following such outlay by Landlord. In
any action or proceeding wherein Landlord and Tenant are
parties, a schedule or "make up" of rate for the building
or demised premises issued by the New York Fire Insurance
Exchange, or other body making fire insurance rates for
said premises, shall be conclusive evidence of the facts
therein stated and of the several items and charges in
the fire insurance rate then applicable to said premises
Tenant shall not bring or
* Specifically excluding, however, existing violations
of law which are the responsibility of Landlord.
2
permit to be brought or kept in or on the demised
premises, and inflammable, combustible or explosive
fluid, chemical, substance or material other than silk or
other textiles, or cause or permit any odors of cooking
or other processes, or any unusual or other objectionable
odors to permeate from the demised premises. That the
premises are being used for the purpose set forth herein
shall not relieve Tenant from the foregoing duties,
obligation and expenses.
TENTH:-(a) Tenant shall not assign, mortgage or ASSIGNMENT,
encumber this agreement nor underlet the demised premises MORTGAGE
or any part thereof or permit the demised premises or any AND
part thereof to be occupied by anybody other than Tenant, SUBLEASING
without the prior written consent of Landlord in each
instance. The transfer of a majority of the issued and
outstanding capital stock of any corporate Lessee of this
lease or a majority of the total interest in any
partnership Lessee, however accomplished, and whether in
a single transaction or in a series of related or
unrelated transactions, shall be deemed an assignment of
this lease. If this lease be assigned, or if the demised
premises or any part thereof be underlet or occupied by
anybody other than Tenant. Landlord may, after default by
Tenant, collect rent from the assignee, under-tenant or
occupant, and apply the net amount collected to the rent
herein reserved, but no such assignment, underletting,
occupancy or collection shall be deemed a waiver of this
covenant, or the acceptance of the assignee, under-tenant
or occupant as tenant, or a release of Tenant from the
further performance by Tenant of covenants on the part of
Tenant herein contained. The consent by Landlord to an
assignment or underletting shall not in any wise be
construed to relieve Tenant from obtaining the express
consent in writing of Landlord to any further assignment
or underletting.
(b) If the demised premises shall be underlet in
whole or in part by Tenant or its heirs, executors,
administrators, legal representatives, successors or
assigns, such party shall, within three (3) days of such
underletting, furnish Landlord with a duplicate original
of such underlease and shall, on demand of Landlord,
supply Landlord within three (3) days of such demand, a
written list of all such under-tenants, the terms,
including expiration duties of their under-tenancies, the
rents payable thereunder, and any additional information
requested by Landlord. This provision or compliance
therewith, however, shall in no event be construed to be
a consent to any underletting or a waiver of the covenant
against underletting contained herein. Non-compliance by
Tenant with the provisions of this paragraph shall be
deemed to be a breach of this lease.
(c) Tenant assumes and shall be responsible for and
liable to Landlord, for all acts and omissions on the
part of any present or future under-tenant, their agents,
employees, servants or licensees, and any breach or
violation of any of the terms, covenants, agreements,
provisions, conditions and limitations of this lease,
whether by act or omission, by any under-tenant shall
constitute a breach or violation of this lease by Tenant.
ELEVENTH:- Throughout the term of this lease. Tenant WASTE
will take good care of the demised premises and
appurtenances and suffer no waste, damage, disfigurement
or injury thereto or any part thereof.
TWELFTH:-(a) Tenant shall make no alterations, ALTERATIONS
decorations, installations, additions or improvements in
or to the demised premises, including, but not limited
to, an air-conditioning or cooling system, unit or part
thereof or other apparatus of like or other nature, nor
bring materials in connection therewith on the demised
premises, without Landlord's prior written consent, and
then only by contractors or mechanics approved by
Landlord, and subject to plans and specifications
approved by Landlord. All such work, alterations,
decorations, installations, additions or improvements
shall be done at Tenant's sole expense and at such times
and in such manner as Landlord may from time to time
designate. All alterations, decorations, installations,
additions or improvements upon demised premises, made by
either party, including all paneling, decorations,
partition, railings, mezzanine floors, galleries, steam,
water, and air conditioning systems and units, shelving,
electric fixtures and the like, shall, unless Landlord
elects otherwise (which election shall be made by giving
a notice pursuant to the provisions hereof not less than
thirty (30) days prior to the expiration or other
termination of this lease or any renewal or extension
thereof) become the property of Landlord, and shall
remain upon, and be surrendered with, said premises, as a
part thereof, at the end of the term or renewal term, as
the case may be. In the event Landlord shall elect
otherwise, then such alterations, installations,
additions or improvements made by Tenant upon the demised
premises as the Landlord shall select, shall be removed
by Tenant at Tenant's sole cost and expense. All
alterations, decorations, installations, additions or
improvements installed by Tenant may be used by Tenant
without additional charge for such use, and without any
right in the Landlord to remove the same in the absence
of any default under this lease during the term hereof.
(b) Tenant, at its own expense, will promptly repair
all damage and injury resulting from such removal and
restore the space theretofore occupied by such fixtures
and installations to good order and condition and to
character and appearance equal to that of the area
adjacent thereto, in default of any of which Landlord may
at its option cause the same to be done at Tenant's
expense.
3
REPAIRS THIRTEENTH:- Tenant shall take good care of the
demised premises and the fixtures and appurtenances
therein, and at its sole cost and expense make all
repairs thereto as and when needed to preserve them in
good working order and condition. All damage or injury to
the demised premises and to its fixtures, appurtenances
and equipment or to the building of which the same form a
part or to its fixtures, appurtenances and equipment
caused by Tenant's moving property in or out of the
building or by installation or removal of furniture,
fixtures or other property, or resulting from fire,
explosion, air-conditioning unit or system, short
circuits, flow or leakage of water, steam, illuminating
gas, sewer gas, sewerage or odors or by frost or by
bursting or leaking of pipes or plumbing works or gas, or
from any other cause of any other kind or nature
whatsoever due to carelessness, omission, neglect,
improper conduct or other cause of Tenant, its servants,
employees, agents, visitors or licensees shall be
repaired, restored or replaced promptly by Tenant at its
sole cost and expense to the satisfaction of Landlord.
All aforesaid repairs, restorations and replacements
shall be in quality and class equal to the original work
or installations. If Tenant fails to make such repairs,
restorations or replacements within a reasonable time
same may be made by Landlord at expense of Tenant and
collectible as additional rent.
LANDLORD'S FOURTEENTH:-(a) Except where otherwise provided in
LIABILITY, OR this lease, there shall be no allowance to Tenant for a
ALTERATIONS diminution of rental value and no liability on the part
REPAIRS of Landlord by reason of inconvenience, annoyance or
injury to business arising from Landlord. Tenant or
others making any repairs, alterations, additions or
improvements in or to any portion of the building or
demised premises, or in or to fixtures, appurtenances, or
equipment thereof, and no liability upon Landlord for
failure of Landlord or others to make any repairs,
alterations, additions or improvements in or to any
portion of the building or of demised premises, or in or
to the fixtures, appurtenances or equipment thereof.
(b) Landlord reserves the right to stop service of
the electric, water, sprinkler, steam, air conditioning,
elevator, heating and plumbing systems, when necessary,
by reason of accident, or emergency, or for repairs,
alterations, replacements or improvements, in the
judgment of Landlord desirable or necessary to be made,
until said repairs, alterations, replacements or
improvements shall have been completed.
EMPLOYMENT OF UNION FIFTEENTH:- Tenant agrees that whenever any
LABOR TO MAKE alterations, additions, improvements, changes or repairs
ALTERATIONS AND to the said premises are consented to by Landlord, or in
REPAIRS the moving of merchandise, fixtures or equipment into the
said building, or moving the same therefrom, only such
labor under agreement with the Building Trades
Employers' Association of New York City, or which shall
not cause strikes or concerted labor action by other
employees of the building, and which have the same or
similar labor union affiliations as those employed by
Landlord or Landlord's contractors, shall be employed.
DISCHARGE OF LIENS, SIXTEENTH:--(a) Any mechanic's lien filed against
ETC. the demised premises, or the building of which the same
form a part, for work claimed to have been done for, or
materials claimed to have been furnished to Tenant, shall
be discharged by Tenant within ten (10) days thereafter,
by payment in full or at Tenant's expense, by filing the
bond required by law. If Tenant fails to so pay or file
any bond. Landlord may pay the amount of said lien or
discharge the same by deposit, or otherwise, billing
Tenant for all expenses in connection therewith as
additional rent.
(b) Nothing in this lease contained shall be deemed
or construed in any way as constituting the consent or
request of Landlord, express or implied by inference or
otherwise, to any contractor, sub-contractor, laborer or
materialman for the performance of any labor or the
furnishing of any materials for any specific improvement,
alteration to, or repair of the demised premises, or any
part thereof, or for the demolition or replacement of the
demised premises or any part thereof.
(c) Tenant agrees to obtain and deliver to Landlord,
written and unconditional waivers of liens (and agreement
that its filed plans may be replaced), for all plans,
specifications and drawings for work or materials to be
furnished to Tenant at the premises, signed by all
architects, engineers and designers to become involved in
such work for Tenant: with respect to contractors,
subcontractors, materialmen and laborers, and all work or
materials to be furnished to Tenant at the premises.
Tenant agrees to obtain and deliver to Landlord written
and unconditional waiver of mechanics liens upon the
premises or the building after payments to the
contractors, and subject to any applicable provisions of
the Lien Law.
SIGNS SEVENTEENTH:-- Tenant will not without Landlord's
written consent, place, affix or paint any signs,
awnings, projections or advertising material of any kind
upon the exterior of the premises or of the building, not
upon the windows, nor in any location that may be visible
from any of the lobbies or passageways. If Tenant shall
cause or permit any sign or other object, similar or
dissimilar, to be placed on or affixed to any
4
part of the building not inside the space specifically
demised hereunder. Landlord shall have the right, without
notice or liability to Tenant, to remove and dispose of
the same and to make any repairs necessitated by such
removal, all at Tenant's sole expense and risk.
Landlord's expenses in so doing shall be deemed
additional rent hereunder and collectible as such.
EIGHTEENTH:-(a) Tenant will not cause or permit any MISCELLANEOUS
connection to be made to the wiring on the electrical PROHIBITED ACTIONS
panel boards of the building without the prior written OF TENANT
consent and supervision of Landlord.
(b) Tenant agrees that it will not drive nails in,
drill in, disfigure or deface any part of the building
nor suffer the same to be done, nor cause or permit the
floors, walls, doors or ceilings of the demised premises
to be drilled, hammered, pounded or otherwise dealt with
in a noisy or disturbing manner at any time during
customary business hours (i.e. between 9:00 A.M. and
5:00 P.M.) whether or not such activities are incidental
to or part of work to which Landlord has consented.
(c) Tenant shall not install any pressing equipment,
whether connected to Tenant's gas-fired boiler or to the
building steam system, without first having plans and
specifications approved by Landlord.
The vacuum used by pressing machines for the drying
of garments shall be created by an electrically driven
vacuum pump. Tenant shall not use any vacuum created by
the use of steam from a gas-fired boiler or from the
building steam system.
(d) Tenant shall not permit any connection to be
made at the demised premises with any high pressure steam
lines, electric current lines or water lines without
Landlord's prior written consent.
(e) Tenant shall not make any electrical or plumbing
installation without Landlord's prior written consent.
All water lines must be installed in red brass.
(f) Window air-conditioning units shall in no event
be installed without Landlords' prior written approval or
be mounted so as to extend outward beyond the line of the
window frame.
(g) Tenant shall install no linoleum, rubber, mastic
or vinyl tile floor covering, unless it is laid over a
layer of felt, double cemented in the manner approved by
Landlord.
(h) Tenant shall not place a load upon any floor of
the demised premises exceeding the floor load per square
foot area which such floor was designed to carry and
which is allowed by law. Landlord reserves the right to
prescribe the weight and position of all safes which must
be placed so as to distribute the weight. Business
machines and mechanical equipment shall be placed and
maintained by Tenant at Tenant's expense in settings
sufficient in Landlord's judgment to absorb and prevent
vibration, noise and annoyance. Tenant agrees that upon
the written request of Landlord. Tenant will, within
fifteen (15) days of the mailing of such request, provide
rubber or other approved settings for absorbing,
preventing and decreasing noise and/or vibration from any
or all machines or machinery, such insulation or other
devices for the prevention, decrease or elimination of
noise satisfactory to Landlord shall be made in such
manner and of such material as Landlord may direct. In
the event that Tenant fails to comply with the aforesaid
request within the fifteen (15) days aforementioned.
Landlord may, at its option, by notice in writing to
Tenant, cause the term of this lease to expire. Landlord
in such event shall have the right to re-enter the
premises by summary proceedings or otherwise without
liability. Landlord shall not give less than thirty (30)
days' notice of its election to terminate the lease as
above provided. Landlord shall have the right to enter
the demised premises with workmen and materials and to
insulate the machinery as above provided, collecting from
Tenant the cost of such work as additional rent in the
event that Tenant fails to comply with the written
request aforementioned alter the expiration of fifteen
(15) days from the receipt thereof.
(i) Tenant shall not move any safe, heavy machinery,
heavy equipment, freight, bulky matter, or fixtures into
or out of the building without Landlord's prior written
consent and the filing with Landlord of a Rigger's
Liability Insurance Certificate satisfactory of Landlord.
If such safe, machinery, equipment, freight, bulky matter
or fixtures require special handling, Tenant agrees to
employ only persons holding a Master Rigger's License to
do said work, and that all work in connection therewith
shall comply with the Administrative Code of the City of
New York.
(j) If the demised premises be or become infested
with vermin. Tenant shall, at Tenant's expense, cause the
same to be exterminated from time to time to the
satisfaction of Landlord, and shall employ such
exterminators and such exterminating company or companies
as shall be approved by Landlord.
5
(k) The water and wash closets and other plumbing
fixtures shall not be used for any purposes other than
those for which they were designed or constructed, and no
sweepings, rubbish, rags, acids or other substances shall
be deposited therein.
(l) Tenant agrees to provide proper receptacles as
called for by the Fire Department. Board of Fire
Underwriters. Fire Insurance Rating Organization or of
the authority having jurisdiction. Tenant hereby agrees
to cause its rubbish or waste to be disposed of at its
own cost and expense, subject to all the rules and
regulations that from time to time may be made in
connection therewith by Landlord, including a regulation
that Tenant shall use a single rubbish or waste remover
designated by Landlord for the removal of the rubbish or
waste of the tenants in the building. Tenant further
agrees that it shall not at any time store any of its
rubbish or waste in the lobbies, foyers, passage-ways or
other spaces adjacent to the premises herein demised, nor
shall Tenant place the rubbish (which is to be taken by
the waste remover) in the said areas prior to 5:00 P.M.
(m) If Tenant is a lessee of any store in said
building, the said Tenant hereby agrees to keep the
sidewalk, entrance and passage-ways unencumbered and
unobstructed, and agrees, further, to remove all ice and
snow from the sidewalks immediately in front of the
demised premises.
(n) Tenant will not suffer, permit or allow unusual
or objectionable odors to be produced upon or permeate
from the demised premises.
WINDOW CLEANING NINETEENTH:- Tenant will not clean, nor require,
permit, suffer or allow any window in the demised
premises to be cleaned, from the outside in violation of
Section 202 of the Labor Law or of the rules of the Board
of Standards and Appeals, or of any other board or body
having or asserting jurisdiction.
NOTICE OF DAMAGE TO TWENTIETH:- Tenant shall give prompt notice to
PREMISES Landlord of any accidents to or defects in the pipes and
apparatus in the building or of any fire that may occur.
LANDLORD'S ACCESS TO TWENTY-FIRST:-- Tenant shall permit Landlord to
PREMISES erect, use and maintain, pipes and conduits in and
through the demised premises. Landlord or Landlord's
agents shall have the right to enter the demised premises
at reasonable times after notice to Tenant to examine the
same, and to show them to prospective purchasers or
lessees of the building and to make such decorations,
repairs, alterations, improvements or additions as
Landlord may deem necessary or desirable, and Landlord
and its representatives shall be allowed to take and
store all material into and upon said premises that may
be required therefor without the same constituting an
eviction of Tenant in whole or in part and the rent
reserved shall in no wise abate while said decorations,
repairs, alterations, improvements, or additions are
being made, by reason of loss or interruption of business
of Tenant* or otherwise. During the six months prior to
the expiration of the term of this lease, or any renewal
term. Landlord may exhibit the premises to prospective
tenants or purchasers, and place upon said premises, or
the exterior thereof, the usual notice "To Let" or "For
Sale", which notices Tenant shall permit to remain
thereon without molestation. If, during the last month of
the term, Tenant shall have removed all or substantially
all of Tenant's property therefrom. Landlord may
immediately enter and alter, renovate and redecorate the
demised premises, without elimination or abatement of
rent, or incurring liability to Tenant for any
compensation, and such acts shall have no effect upon
this lease. If Tenant shall not be personally present to
open and permit an entry into said premises, at any time,
when for any reason an entry therein shall be necessary
or permissible. Landlord or Landlord's agents may enter
the same by a master key or may forcibly enter the same
without rendering Landlord or such agents liable therefor
(if during such entry Landlord or Landlord's agents shall
accord reasonable care to Tenant's property), and without
in any manner affecting the obligations and covenants of
this lease. *Nothing herein contained, however, shall be
deemed or construed to impose upon Landlord any
obligation, responsibility or liability whatsoever, for
the care, supervision or repair, of the building or any
part thereof, other than as herein provided. Landlord
shall also have the right at any time, without the same
constituting an actual or constructive eviction and
without incurring any liability to Tenant therefor, to
change the arrangement and/or location of entrances or
passageways, doors and doorways, and corridors,
elevators, stairs, toilets, or other public parts of the
building and to change the name, number or designation by
which the building is commonly known.
ELECTRICITY TWENTY-SECOND:-- Lessee agrees that Lessor may
furnish electricity to Lessee on a "submetering" basis or
on a "rent inclusion" basis.
(a) Submetering: If and so long as Lessor provides
electricity to the demised premises on a submetering
basis. Lessee covenants and agrees to purchase the same
from Lessor or Lessor's designated agent at charges,
terms and rates set, from time to time, during the term
of this lease by Lessor but not more than those specified
*Landlord shall endeavor to minimize interference with
Tenant's business.
6
in the service classification in effect on January 1,
1970 pursuant to which Lessor then purchased electric
current from the public utility corporation serving the
part of the city where the building is located: provided,
however, said charges shall be increased in the same
percentage as any percentage increase in the billing
to Lessor for electricity for the entire building, by
reason of increase in Lessor's electric rates or service
classifications, subsequent to January 1, 1970, and so as
to reflect any increase in Lessor's electric charges,
fuel adjustment, or by taxes or charges of any kind
imposed on Lessor's electricity purchases, or for any
other such reason, subsequent to said date. Any such
percentage increase in Lessor's billing for electricity
due to changes in rates or service classifications shall
be computed by the application of the average consumption
(energy and demand) of electricity for the entire
building for the twelve (12) full months immediately
prior to the rate and/or service classification change,
or any changed methods of or rules on billing for same,
on a consistent basis to the new rate and/or service
classification and to the service classification in
effect on January 1, 1970. If the average consumption of
electricity for the entire building for said prior twelve
(12) months cannot reasonably be applied and used with
respect to changed methods of or rules on billing, then
the percentage increase shall be computed by the use of
the average consumption (energy and demand) for the
entire building for the first three (3) months after such
change, projected to a full twelve (12) months; and that
same consumption, so projected, shall be applied to the
service classification in effect on January 1, 1970.
Where more than one meter measures the service of Lessee
in the building, the service rendered through each meter
may be computed and billed separately in accordance with
the rates herein. Bills therefore shall be rendered at
such times as Lessor may elect and the amount, as
computed from a meter, shall be deemed to be, and be paid
as, additional rent. In the event that such bills are not
paid within five (5) days after the same are rendered.
Lessor may, without further notice, discontinue the
service of electric current to the demised premises
without releasing Lessee from any liability under this
lease and without Lessor or Lessor's agent incurring any
liability for any damage or loss sustained by Lessee by
such discontinuance of service. If any tax is imposed
upon Lessor's receipt from the sale or resale of
electrical energy or gas or telephone service to Lessee
by any Federal. State or Municipal Authority, Lessee
covenants and agrees that, where permitted by law,
Lessee's pro-rata share of such taxes shall be passed on
to, and included in the bill of, and paid by, Lessee to
Lessor.
(b) Rent Inclusion: If and so long as Lessor
provides electricity to the demised premises on a rent
inclusion basis. Lessee agrees that the fixed annual rent
shall be increased by the amount of the Electricity Rent
Inclusion Factor ("ERIF"), as hereinafter defined. Lessee
acknowledges and agrees (i) that the fixed annual rent*
hereinabove set forth in this lease does not yet, but is
to include an ERIF of $2.75 per rentable square foot to
compensate Lessor for electrical wiring and other
installations necessary for, and for its obtaining and
making available to Lessee the redistribution of,
electric current as an additional service; and (ii) that
said ERIF, which shall be subject to periodic adjustments
as hereinafter provided, has been partially based upon an
estimate of the Lessee's connected electrical load, which
shall be deemed to be the demand (KW), and hours of use
thereof, which shall be deemed to be the energy (KWH) for
ordinary lighting and light office equipment and the
operation of the usual small business machines, including
Xerox or other copying machines (such lighting and
equipment are hereinafter called "Ordinary Equipment")
during ordinary business hours ("ordinary business hours"
shall be deemed to mean 50 hours per week), with Lessor
providing an average connected load of 4 1/2 watts of
electricity for all purposes per rentable square foot.
Any installation and use of equipment other than Ordinary
Equipment and/or any connected load and/or any energy
usage by Lessee in excess of the foregoing shall result
in adjustment of the ERIF as hereinafter provided. For
purposes of this Article the rentable square foot area of
the presently demised premises shall be deemed to be
21,248 square feet.
If the cost to Lessor of electricity shall have
been, or shall be, increased or decreased subsequent to
January 1, 1990 (whether such change occurs prior to or
during the term of this lease), by change in Lessor's
electric rates or service classifications, or by any
increase, subsequent to the last such electric rate or
service classification change, in fuel adjustments or
charges of any kind, or by taxes, imposed on Lessor's
electricity purchases, or for any other such reason, then
the ERIF, which is a portion of the fixed annual rent,
shall be changed in the same percentage as any such
change in cost due to changes in electric rates or
service classifications, and, also, Lessee's payment
obligation, for electricity redistribution, shall change
from time to time so as to reflect any such increase in
fuel adjustments or charges, and taxes. Any such
percentage increases in Lessor's cost due to changes in
electric rates or service classifications shall be
computed by the application of the average consumption
(energy and demand) of electricity for the entire
building for the twelve (12) full months immediately
prior to the rate and/or service classification change,
other change in cost, or any changed methods of or rules
on billing for same, on a consistent basis to the new
rate and/or service classification and to
*$2.90 effective 4/17/92.
7
the immediately prior existing rate and/or service
classifications. If the average consumption of
electricity for the entire building for said prior twelve
(12) months cannot reasonably be applied and used with
respect to changed methods of or rules on billing, then
the percentage increase shall be computed by the use of
the average consumption (energy and demand) for the
entire building for the first three (3) months after such
change, projected to a full twelve (12) months, so as to
reflect the different seasons; and the same consumption,
so projected, shall be applied to the rate and/or service
classification which existed immediately prior to the
change. The parties agree that a reputable, independent
electrical consultant, selected by Lessor ("Lessor's
electrical consultant"), shall determine the percentage
change for the changes in the ERIF due to Lessor's
changed costs, and that Lessor's electrical consultant
may from time to time make surveys in the demised
premises of the electrical equipment and fixtures and the
use of current. (i) If any such survey shall reflect an
average connected load in the demised premises in excess
of 4 1/2 watts of electricity for all purposes per
rentable square foot and/or energy usage in excess of
ordinary business hours (each such excess is hereinafter
called "excess electricity") then the connected load
and/or the hours of use portion(s) of the then existing
ERIF shall each be increased by an amount which is equal
to a fraction of the then existing ERIF, the numerator of
which is the excess electricity (i.e. excess connected
load and/or excess usage) and the denominator of which is
the average connected load and/or the usage thereof which
was the basis for the computation of the then existing
ERIF. Such fractions shall be determined by Lessor's
electrical consultant. The fixed annual rent shall then
be appropriately adjusted, effective as of the date of
any such change in connected load and/or usage, as
disclosed by said survey, (ii) If such survey shall
disclose installation and use of other than Ordinary
Equipment, then effective as of the date of said survey,
there shall be added to the ERIF portion of the fixed
annual rent (computed and fixed as hereinabove described)
an additional amount equal to what would be paid under
the SC-4 Rate I Service classification in effect on
January 1, 1990 (and not the time-of-day rate schedule)
for such load and usage of electricity, with the
connected load deemed to be the demand (KW) and the hours
of use thereof deemed to be the energy (KWH), as
hereinbefore provided, (which addition to the ERIF shall
be increased or decreased by all electricity cost changes
of Lessor, as hereinabove provided, from January 1, 1990
through the date of billing).
*
In no event, whether because of surveys or for any
other reason, is the originally specified $2.75 per
rentable square foot ERIF portion of the fixed annual
rent (plus any net increase thereof, but not decrease, by
virtue of all electric rate or service classification
changes subsequent to January 1, 1990) to be reduced.
(c) General Conditions: The determinations by
Lessor's electrical consultant shall be binding and
conclusive on Lessor and on Lessee from and after the
delivery of copies of such determinations to Lessor and
Lessee, unless, within fifteen (15) days after delivery
thereof, Lessee disputes such determination. If Lessee so
disputes the determination, it shall, at its own expense,
obtain from a reputable, independent electrical
consultant its own determinations in accordance with the
provisions of this Article. Lessee's consultant and
Lessor's consultant then shall seek to agree. If they
cannot agree within thirty (30) days they shall choose a
third reputable electrical consultant, whose cost shall
be shared equally by the parties, to make similar
determinations which shall be controlling. (If they
cannot agree on such third consultant within (10) days,
then either party may apply to the Supreme Court in the
County of New York for such appointment.) However,
pending such controlling determinations, Lessee shall pay
to Lessor the amount of additional rent or ERIF in
accordance with the determinations of Lessor's electrical
consultant. If the controlling determinations differ from
Lessor's electrical consultant, then the parties shall
promptly make adjustment for any deficiency owed by
Lessee or overage paid by Lessee.
At the option of Lessor, Lessee agrees to purchase
from Lessor or its agents all lamps and bulbs used in the
demised premises and to pay for the cost of installation
thereof. Lessor shall not be liable to Lessee for any
loss or damage or expense which Lessee may sustain or
incur if either the quantity or character of electric
service is changed or is no longer available or suitable
for Lessee's requirements. Lessee covenants and agrees
that at all times its use of electric current shall never
exceed the capacity of existing feeders to the building
or the risers or wiring installation. Lessee agrees not
to connect any additional electrical equipment to the
building electric distribution system, other than lamps,
typewriters and other small office machines which consume
comparable amounts of electricity, without Lessor's prior
written consent, which consent shall not be unreasonably
withheld. Any riser or risers to supply Lessee's
electrical requirements, upon written request of Lessee,
will be installed by Lessor, at the sole cost and expense
of Lessee, if, in Lessor's sole judgment, the same are
necessary and will not cause permanent damage or injury
to the building or demised premises or cause or create a
*$2.90 effective 4/17/92.
8
dangerous or hazardous condition or entail excessive or
unreasonable alterations, repairs or expense or interfere
with or disturb other tenants or occupants. In addition
to the installation of such riser or risers. Lessor will
also at the sole cost and expense of Lessee, install all
other equipment proper and necessary in connection
therewith subject to the aforesaid terms and conditions.
The parties acknowledge that they understand that it is
anticipated that electric rates, charges, etc., may be
changed by virtue of time-of-day rates or other methods
of billing, and that the references in the foregoing two
paragraphs to changes in methods of or rules on billing
are intended to include any such changes. Supplementing
Article 53 hereof, if all or part of the submetering
additional rent or the ERIF payable in accordance with
Subdivision (A) or (B) of this Article becomes
uncollectible or reduced or refunded by virtue of any
law, order or regulation, the parties agree that, at
Lessor's option, in lieu of submetering additional rent
or ERIF, and in consideration of Lessee's use of the
buildings electrical distribution system and receipt of
redistributed electricity and payment by Lessor of
consultants' fees and other redistribution costs, the
fixed annual rental rate(s) to be paid under this Lease
shall be increased by an "alternative charge" which shall
be a sum equal to $2.75 per year per rentable sq. ft. of
the demised premises, changed in the same percentage as
any changes in the cost to Lessor for electricity for the
entire building subsequent to January 1, 1990, because of
electric rate or service classification changes, as in
Subdivision (B) hereof provided, and such percentage
change to be computed as in Subdivision (B) provided. The
Lessor reserves the right, at any time upon thirty (30)
days' written notice, to change its furnishing of
electricity to Lessee from a rent inclusion basis to a
submetering basis, or vice versa. The Lessor reserves the
right to terminate the furnishing of electricity on a
rent inclusion, submetering, or any other basis at any
time, upon thirty (30) days' written notice to the
Lessee, in which event the Lessee may make application
directly to the public utility for the Lessee's entire
separate supply of electric current and Lessor shall
permit its wires and conduits, to the extent available
and safely capable, to be used for such purpose. Any
meters, risers or other equipment or connections
necessary to furnish electricity on a submetering basis
or to enable Lessee to obtain electric current directly
from such utility shall be installed at Lessee's sole
cost and expense. Only rigid conduit or electricity metal
tubing (EMT) will be allowed. The Lessor, upon the
expiration of the aforesaid thirty (30) days' written
notice to the Lessee may discontinue furnishing the
electric current but this lease shall otherwise remain in
full force and effect. If Lessee was provided electricity
on a rent inclusion basis when it was so discontinued,
then commencing when Lessee receives such direct service
and as long as Lessee shall continue to receive such
service, the fixed annual rental rate payable under this
lease shall be reduced by the amount of the ERIF which
was payable immediately prior to such discontinuance of
electricity on a rent inclusion basis.
TWENTY-THIRD:--(a) If Landlord installs a water WATER
meter to measure Tenant's water consumption for all SEWER
purposes, Tenant shall pay Landlord for the cost of meter RENTS
and the cost of the installation thereof and throughout
the duration of Tenant's occupancy Tenant shall keep said
meter and installation equipment in good working order
and repair at Tenant's own cost and expense, in default
of which Landlord may cause such meter and equipment to
be replaced or repaired and collect the cost thereof from
Tenant. Tenant agrees to pay for water consumed, as shown
on said meter as and when bills are rendered, and on
default in making such payment Landlord may pay such
charges and collect the same from Tenant Landlord may
inspect such water meter at any time and shall have
access thereto at all times for the purpose of such
inspection.
(b) In addition to the foregoing, Tenant agrees to
pay its proportionate share of the water consumed in the
toilets and other portions of the permises over which
Landlord may reserve control, irrespective of the fact
that the same shall be located outside of the demised
premises.
(c) Tenant covenants and agrees to pay its pro-rata
share of the sewer rent, charge or any other tax, rent
levy or charge which now or hereafter is assessed,
imposed or a lien upon the demised premises or the realty
of which they are part pursuant to law, order or
regulation made or issued in connection with the use,
consumption, maintenance or supply of water, water system
or sewage or sewage connection or system.
(d) The bill rendered by Landlord for metered water,
sewer or any other charges provided for in this paragraph
"23," shall be based upon Tenant's consumption and shall
be payable by Tenant as additional rent. Any such costs
or expenses incurred or payments made by landlord for any
of the reasons or purposes hereinabove stated, shall be
deemed to be additional rent payable by Tenant and
collectible by Landlord as such. If the building or the
demised premises or any part thereof be supplied with
water through a meter through which water is also
supplied to other premises, Tenant shall pay to Landlord
as additional rent, on the first day of each month,
$255.00, as Tenant's portion. Independently of and in
addition to
9
any of the remedies reserved to Landlord hereinabove or
elsewhere in this lease, Landlord may sue for and collect
any monies to be paid by Tenant or paid by Landlord for
any of the reasons or purposes hereinabove set FORTH.
SPRINKLER TWENTY-FOURTH:--If the sprinkler system or any of
its appliances shall be damaged or injured or not in
proper working order by reason of any act or omission of
Tenant, Tenant's agents, servants, employees, licensees
or visitors, Tenant shall forthwith restore the same in
good working condition at its own expense; and
if the New York Board of Fire Underwriters or the New
York Fire Insurance Rating Organization or any bureau,
department or official of the State or City Government,
require or recommend that any changes, modifications,
alterations or additional sprinkler heads or other
equipment be made or supplied by reason of Tenant's
business, or the location of partitions, trade fixtures,
or other contents of the demised premises, or for any
other reason, or if any such changes, modifications,
alterations, additional sprinkler heads or other
equipment, become necessary to prevent the imposition of
a penalty or charge against the full allowance for a
sprinkler system in the fire insurance rate as fixed by
said Rating Organization, or by any Fire Insurance
Company, Tenant shall, at Tenant's expense, promptly make
and supply such changes, modifications, alterations,
additional sprinkler heads or other equipment Tenant
shall pay to Landlord as additional rent the sum of $
255.00 on the first day of each month during the term of
this lease, as Tenant's portion of the contract price for
sprinkler supervisory service.
AIR TWENTY-FIFTH:-- With reference to the 34th Floor
CONDITIONING part of the demised premises, Tenant shall install at its
own cost and expense the air conditioning system which
affects the whole or a portion of the demised premises,
and shall, at its own cost and expense, maintain and
operate said system in compliance with all present and
future laws and governmental requirements, and shall
obtain all governmental licenses and permits now or
hereafter required. Tenant shall pay for all electric
current, water and refrigerants used in connection with
said system. Tenant, at its own cost and expense, shall
make or cause to be made, all repairs, alterations,
changes, additions or improvements in and to said system
which may be necessary or which may be required or
recommended by Landlord or by any governmental authority,
and shall furnish all parts and supplies necessary or
desirable in connection therewith, but no alterations,
changes, additions or improvements shall be made by
Tenant without the advance written consent of Landlord.
Landlord's charges for electric current, water and
refrigerants and for such parts, supplies, repairs,
alterations, changes, additions or improvements as are
caused to be furnished or made by Landlord shall be
payable by Tenant as additional rent upon presentation of
Landlord's bill for same. The non-functioning or
defective functioning of said air conditioning system, or
Tenant's inability to operate or maintain the same in
compliance with lawful requirements or Landlord's removal
thereof or termination of the operation thereof as
provided in this paragraph, or any delay, discomfort or
inconvenience suffered by Tenant in connection therewith,
or, without limitation of or by the foregoing, any other
matter or thing related to such system, shall not give
rise to any obligation or liability on the part of
Landlord and shall not affect this lease or be deemed to
release or discharge Tenant of any of Tenant's
obligations or liabilities under this lease or otherwise.
Title to said system and all present and future parts
thereof is and shall be vested in Landlord. *
ELEVATOR TWENTY-SIXTH:--(a) As long as Tenant is not in
default under any of the covenants of this lease,
Landlord shall provide necessary elevator facilities on
business days from 8:00A.M to 6:00P.M., and on Saturdays
from 8:00A.M. to 1:00P.M. On Sundays, holidays and
nights, Landlord win furnish at least one (1) elevator.
(b) If the building of which the demised premises
are a part supplies manually operated elevator service,
Landlord may proceed with alterations necessary to
substitute automatic control elevator service upon ten
(10) days' written notice to Tenant without in any way
affecting the obligations of Tenant hereunder, provided
that the same shall be done with the minimum amount of
inconvenience to Tenant, and Landlord pursues with due
diligence the completion of the alterations. Where
automatic control elevator service is now, or hereafter
furnished, and the demised premises contain an entire
floor or floors. Tenant will provide, at its own cost and
expense, locks for all entrances to such floor or floors
from the elevators.
(c) Tenant agrees it will not permit its employees
other than office help to use the passenger elevator in
said building, nor will it permit them to use the stairs
leading to and from the passenger entrance to said
*(See Article Sixty Sixth and Sixty Seventh hereof). See
Article Twenty-Fifth-A with reference to the 35th Floor
part of the demised premises.
10
building. Landlord may prescribe and regulate which
elevator and entrance shall be used by Tenant's employees
and for Tenant's shipping.
TWENTY-SEVENTH:-Landlord will:
(a) Furnish heat to the demised premises, when and HEAT. CLEANING.
as required by law. on business days during regular PUBLIC AREAS
business hours.
(b) Cause to be kept clean the public halls and
public portions of the building, which are used in common
by all tenants.
TWENTY-EIGHTH:-It is expressly agreed that if in REQUIRED
consequence of the use of the demised premises for ALTERATIONS.
manufacturing purposes any Municipal or State Authority MACHINERY
requires alterations and additions 10 such premises or
the building of which they are a part. Landlord, in
addition to other remedies provided for in this lease.
shall have the option of terminating this lease on sixty
(60) days' written notice to Tenant. Upon expiration of
said sixty (60) days, the term of this lease shall
terminate, and Tenant shall immediately vacate the
premises. In such event. Landlord shall refund to Tenant
the unearned pro rata portion of any rent paid in
advance. Landlord reserves the privilege of complying
with any order, rule or regulation as aforementioned in
order to remove such violation, if any. In such event.
Tenant waives any and all claims for damages growing out
of the work in the building or on the premises in
connection therewith. In the event that the violation can
be removed by Tenant's limiting the number of employees
in the demised premises. Tenant shall so limit the number
of employees immediately and no claim for damages or any
loss may be made against Landlord therefor.
TWENTY-NINTH:-Tenant shall have the use of the FIXTURES &
partitions existing in the premises demised herein and of PARTITIONS
all other equipment, fixtures and appurtenances installed INSTALLED
by Landlord prior to or during the term hereof. The BY LANDLORD
ownership of all such property shall at all times be
vested in Landlord and possession thereof shall revert to
Landlord upon the expiration of the lease.
THIRTIETH:--If any vault space is adjacent to the VAULTS
demised premises, the same shall not be or be deemed to
be part of the demised premises or its appurtenances.
Landlord may permit Tenant to use such vault space
gratuitously, but such permission may be revoked by
Landlord at any time on two (2) days" notice. Landlord
shall have the right at any time to cause a wall to be
erected for the purpose of sealing off such vault space
from the demised premises. Said wall may be erected
wholly or partly on that portion of the demised premises
which abuts such vault space. Landlord and its designees
shall have the right from time to time to enter and
remain upon the demised premises, with men and materials,
for the purpose of erecting such wall. Tenant shall not
be entitled to any compensation, abatement of rent, or
other claim by reason of any action taken under this
paragraph by or on behalf of Landlord. Any fee or license
charge or tax of municipal authorities for such vault
shall be paid by Tenant.
THIRTY-FIRST:--Landlord or its agents shall not be LIABILITY OF
liable for any damage to property of Tenant or of others LANDLORD.
entrusted to employees of the building, nor for the loss PROPERTY
of or damage to any property of Tenant by theft or LOSS.
otherwise. Landlord or its agents shall not be liable for DAMAGE
any injury or damage to persons or property resulting
from fire, explosion, falling ceilings, falling plaster,
steam, gas. electricity, water, rain or snow or leaks
from any part of said building or from the pipes,
appliances or plumbing works or from the roof, street or
subsurface or from any other place or by dampness or by
any other cause of whatsoever nature, including but not
limited to the making of repairs and improvements, unless
caused by or due to the negligence of Landlord, its
agents, servants or employees: nor shall Landlord or us
agents be liable for any such damage caused by other
tenants or persons in said building or caused by
operations in construction of any private, public or
quasi public work; nor shall Landlord be liable for any
latent defect in the demised premises or in the building
of which they form a part. Tenant shall give immediate
notice to Landlord in case of fire or accidents in the
demised premises or in the building or of defects therein
or in any fixtures or equipment.
THIRTY-SECOND:--Tenant shall, throughout the term INDEMNITY
and thereafter, indemnify Landlord and save it harmless
and free from damages, liabilities, penalties, losses,
expenses, causes of action, claims, suits and judgments,
as well as all expenses and attorneys' fees, arising from
injury during said term to the Premises of any nature,
and also for any matter or thing growing out of the
occupation of the demised premises or the streets,
sidewalks, or vaults adjacent thereto occasioned in whole
or part by any act or acts, omission or omissions of
Tenant, its employees, guests, agents, assigns or
undertenants.
THIRTY-THIRD:--Neither this lease nor any LIABILITY OF
obligation hereunder on Tenant's part to be performed LANDLORD SERVICE
(including, but not limited to. Tenant's obligation to INTERRUPTION
pay the rents provided for hereunder) shall in any wise ACTS BEYOND CONTROL
be
11
released, discharged, impaired, excused or otherwise
affected because of Landlord's inability to supply,
furnish or make such services, fixtures, equipment,
repairs, additions, improvements, alterations and or
decorations. If any, as Landlord may be required to
supply, furnish or make hereunder or in connection
herewith, or because of any delay in supplying,
furnishing or making any of the foregoing, if such
inability or delay directly or indirectly results from or
is caused by or attributable to any cause or thing
whatsoever beyond Landlord's control including, but not
limited to, any law or ordinance or any governmental
order, rule, regulation or requirement, or any shortages
in supplies, materials or. labor, or any acts of God, or
any labor difficulties, disasters or acts of public
enemies, and in any such event Landlord shall be relieved
of any liability to Tenant which it might otherwise have
had by reason of any such requirement. Lessee agrees to
look solely to Lessor's estate and interest in the land
and building, or the lease of the building or of the land
and building, and the demised premises, for the
satisfaction of any right or remedy of Lessee for the
collection of a judgment (or other judicial process)
requiring the payment of money by Lessor, in the event
of any liability by Lessor, and no other property or
assets of Lessor shall be subject to levy, execution or
other enforcement procedure for the satisfaction of
Lessee's remedies under or with respect to this lease,
the relationship of landlord and tenant hereunder, or
Lessee's use and occupancy of the demised premises or any
other liability of Lessor to Lessee (except for
negligence).
SUBORDINATION THIRTY-FOURTH:--This lease is and shall be subject
and subordinate at all times to all present or future
leases and subleases of the entire building or of the
land and entire building of which the demised premises
form a part, and to all mortgages which now affect or may
hereafter affect or be made in respect of such leases and
subleases or the real property of which the demised
premises form a part (whether or not such leases or
mortgages also affect any other or additional real
property), and to all renewals, modifications,
consolidations, replacements and extensions thereof, and
to all advances made or hereafter to be made upon the
security thereof. This clause shall be self-operative and
no further instrument in writing to effectuate such
subordination shall be necessary. In confirmation of such
subordination, however, Tenant shall, on demand, promptly
execute, acknowledge and deliver such further instruments
or certificates that Landlord may request. Tenant hereby
irrevocably appoints Landlord the attorney-in-fact of
Tenant to execute, acknowledge and deliver any such
instrument or certificate for or on behalf of Tenant. In
the event that any Master Lease or any other ground or
underlying lease is terminated, or any mortgage
foreclosed, this lease shall not terminate or be
terminable by Lessee unless Lessee was specifically named
in any termination or foreclosure judgment or final
order. In the event that the Master Lease or any other
ground or underlying lease is terminated as aforesaid.
Lessee agrees to enter into a new lease covering the
within premises, for the remaining term of this lease and
otherwise on the same terms, conditions and rentals as
herein provided, with and at the election of the holder
of any superior lease, or if there is no superior lease
in existence, then with and at the election of the holder
of the fee title to the premises. If the current term of
the Master Lease shall expire prior to the date set forth
herein for the expiration of this lease, then, unless
Lessor, at its sole option, shall have elected to extend
or renew the term of the Master Lease, the term of this
lease shall expire on the date of expiration of the
Master Lease, notwithstanding the later expiration date
hereinabove set forth. If the Master Lease is renewed,
then the term of this lease shall expire as hereinabove
set forth. From time to time, Lessee, on at least ten
(10) days' prior written request by Lessor, will deliver
to Lessor a statement in writing certifying that this
lease is unmodified and in full force and effect (or if
there shall have been modifications, that the same is in
full force and effect as modified and stating the
modifications) and the dates to which the rent and other
charges have been paid and stating whether or not the
Lessor is in default in performance of any covenant,
agreement or condition contained in this lease and, if
so, specifying each such default of which Lessee may have
knowledge. This paragraph shall not be deemed modified in
whole or in part by any provision of this lease or any
rider thereto during the term hereof, unless such
provisions or rider shall by its terms expressly so
modify it.
FIRE THIRTY-FIFTH:--Provided the damage be not caused by
the fault or neglect of Tenant or of its employees,
agents, visitors or licensees. In the event of damage by
fire, or other action of the elements, to the demised
premises not rendering all of them until for occupancy.
Landlord shall repair the same with reasonable dispatch
after notice of such damage, and the rent accrued or
accruing shall not cease; but if the damage be so
extensive as to render all of the demised premises
untenantable, the rent shall cease until they be
repaired, provided the damage be not caused by the
carelessness or negligence of Tenant or of the agents or
servants of Tenant. No penalty shall accrue for
reasonable delay which may arise by reason of adjustment
of insurance on the part of Landlord and/or Tenant, and
for reasonable delay on account of "labor troubles" or
any other cause beyond Landlord's control. If the demised
premises are totally damaged or are rendered wholly
untenantable by fire or other cause, and if Landlord
shall decide not to restore or not to rebuild the same,
or if the building shall be so damaged that Landlord
shall decide to demolish it or to rebuild it or if the
cost of restoration of the
12
building of which the demised premises are a part,
resulting from the aforesaid fire or other casualty shall
exceed the sum of $3,000,000, then or in any of such
events Landlord may, within ninety (90) days after such
fire or other cause, give Tenant a notice in writing of
termination, which notice shall be given as provided in
this lease, and thereupon the term of this lease shall
expire by lapse of time upon the third day after such
notice is given, and Tenant shall vacate the demised
premises and surrender the same to Landlord. If Tenant
shall not be in default under this lease then, upon the
termination of this lease under the conditions provided
for in the sentence immediately preceding. Tenant's
liability for rent shall cease as of the day following
the casualty. Tenant hereby expressly waives the
provisions of Section 227 of the Real Property Law and
agrees that the foregoing provisions of this paragraph
shall govern and control in lieu thereof. If the damage
or destruction be due to the fault or neglect of Tenant,
the debris shall be removed by and at the expense of
Tenant.
(See Article Seventyth)
THIRTY-SIXTH:-If the whole or any part of the CONDEMNATION
demised premises shall be acquired or condemned by
Eminent Domain for any public or quasi public use or
purpose, then and in that event, the term of this lease
shall cease and terminate from the date of title vesting
in such proceeding. If any part of the land or the
building of which the demised premises are a part shall
be so acquired or condemned, then and in that event the
term of this lease, at the option of Landlord, shall
cease and terminate on ten (10) days' notice by Landlord
to Tenant. In neither event shall Tenant have any claim
for the value of any unexpired term of said lease.
THIRTY-SEVENTH:-If when and to the extent BANKRUPTCY
permitted by law the parties agree that the following
provisions shall apply to this lease and tenancy (and
that the provisions of 11 U.S.C. Section 365(b) shall be
applied): (a) If at any time prior to the date herein
fixed as the commencement of the term of this lease there
shall be filed against Tenant thereof or if such filing
is made by Tenant in any court pursuant to any statute
either of the United States or of any Statute a petition
in bankruptcy or insolvency or for reorganization or for
the appointment of a receiver or trustee of all or a
portion of Tenant's property, and within thirty (30) days
thereof Tenant fails to secure a discharge thereof, or if
Tenant makes an assignment for the benefit of creditors,
or petition for or enter into an arrangement, this lease
shall ipso facto be cancelled and terminated, and in
which event, neither Tenant nor any person claiming
through or under Tenant or by virtue of any statute or of
an order of any court shall be entitled to possession of
the demised premises and Landlord, in addition to the
other rights and remedies given by (c) hereof and by
virtue of any other provision herein or elsewhere in this
lease contained or by virtue of any statute or rule of
law, may retain as liquidated damages any rent, security,
deposit or monies, received by him from Tenant or others
in behalf of Tenant upon the execution hereof.
(b) If at the date fixed as the commencement of the
term of this lease or if at any time during the term
hereby demised, there shall be filed against Tenant
thereof or if such filing is made by Tenant in any court
pursuant to any statute of the United States or any State
a petition of bankruptcy or insolvency or for
reorganization or for the appointment of a receiver or
trustee of all or a portion of Tenant's property, and
within thirty (30) days thereof Tenant fails to secure a
discharge thereof, or if Tenant makes an assignment for
the benefit of creditors or petition for or enter into an
arrangement, this lease, at the option of Landlord,
exercised within a reasonable time after notice of the
happening of any one or more of such events, may be
cancelled and terminated, and in which event neither
Tenant nor any person claiming through or under Tenant by
virtue of any statute or of an order of any court shall
be entitled to possession or to remain in possession of
the premises demised, but shall forthwith quit and
surrender the premises, and Landlord, in addition to the
other rights and remedies Landlord has by virtue of any
other provision herein or elsewhere in this lease
contained or by virtue of any statute or rule of law, may
retain as liquidated damages any rent, security, deposit
or monies received by him from Tenant or others in behalf
of Tenant.
(c) It is stipulated and agreed that in the event of
the termination of this lease pursuant to (a) or (b)
hereof. Landlord shall forthwith. notwithstanding any
other provisions of this lease to the contrary, be
entitled to recover from Tenant as and for liquidated
damages an amount equal to the difference between the
rent reserved hereunder for the unexpired portion of the
term demised and the then fair and reasonable rental
value of the demised premises for the same period. In the
computation of such damages, the difference between any
installment of rent becoming due hereunder after the date
of termination and the fair and reasonable rental value
of the demised premises for the period for which such
installment was payable shall be discounted to the date
of termination at the rate of four per cent (4%) per
annum. If such premises or any part thereof be re-let by
Landlord for the unexpired term of said lease, or any
part thereof, before presentation of proof of such
liquidated damages to any court, commission or tribunal,
the amount of rent reserved upon such re-letting shall be
prima facie to be the fair and reasonable rental value
for the part or the whole of the premises so re-let
during the term of the re-letting. Nothing herein
contained shall limit or prejudice the right of Landlord
to prove for and obtain as liquidated damages by reason
of such termination, an amount equal to the maximum
13
allowed by any statute or rule of law in effect at the
time when, and governing the proceedings in which, such
damages are to be proved, whether or not such amount be
greater, equal to or less than the amount of the
difference referred to above.
SECURITY THIRTY-EIGHTH:-Tenant has deposited with Landlord
the sum of $26,560 as security for the faithful
performance and observance by Tenant of the terms,
provisions and conditions of this lease: it is agreed
that in the event Tenant defaults in respect of any of
the terms, provisions and conditions of this lease,
including, but not limited to the payment of rent and
additional rent. Landlord may use, apply or retain the
whole or any part of the security so deposited to the
extent required for the payment of any rent and
additional rent or any other sum as to which Tenant is in
default or for any sum which Landlord may expend or may
be required to expend by reason of Tenant's default in
respect of any of the terms, covenants and conditions of
this lease, including but not limited to any damages or
deficiency in the re-letting of the premises, whether
such damage or deficiency accrued before or after summary
proceedings or other re-entry by Landlord. Tenant shall,
upon demand, deposit with Landlord the full amount so
used, in order that Landlord shall have the full security
deposit on hand at all times. In the event that Tenant
shall fully and faithfully comply with all of the terms,
provisions, covenants and conditions of this lease, the
security shall be returned to Tenant after the date fixed
as the end of the lease and after delivery of entire
possession of the demised premises to Landlord. In the
event of any transfer or conveyance by Landlord of its
lease to the building of which the demised premises form
a part hereinafter referred to. Landlord shall have the
right to transfer the security to the transferee or
grantee, and Landlord shall thereupon be released by
Tenant from all liability for the return of such
security, and Tenant agrees to look to the new Landlord
solely for the return of said security; and it is agreed
that the provisions hereof shall apply to every transfer
or assignment made of the security to a new Landlord.
Tenant further covenants that it will not assign or
encumber or attempt to assign or encumber the monies
deposited herein as security and that neither Landlord
nor its successors or assigns shall be bound by any such
assignment, encumbrance, attempted assignment or
attempted encumbrance.
DEFAULT THIRTY-NINTH:-(a) If Tenant defaults in
fulfilling any of the covenants of this lease other than
the covenants for the payment of rent or additional rent,
or of any ancillary agreement, or if the demised premises
become vacant or deserted, then, in any one or more of
such events, upon Landlord serving a written five (5)
days' notice upon Tenant specifying the nature of said
default and upon the expiration of said five (5) days. If
Tenant shall have failed to comply with or remedy such
default, or if the said default or omission complained of
shall be of such a nature that the same cannot be
completely cured or remedied within said five (5) day
period, and if Tenant shall not have diligently commenced
curing such default within such five (5) day period, and
shall not thereafter with reasonable diligence and in
good faith proceed to remedy or cure such default, then
Landlord may serve a written three (3) days' notice of
cancellation of this lease upon Tenant, and upon the
expiration of said three (3) days, this lease and the
term thereunder shall end and expire as fully and
completely as if the date of expiration of such three (3)
day period were the day herein definitely fixed for the
end and expiration of this lease and the term thereof,
and Tenant shall then quit and surrender the demised
premises to Landlord, but Tenant shall remain liable as
hereinafter provided.
(b) If the notice provided for in (a) hereof shall
have been given, and the term shall expire as aforesaid:
or (1) if Tenant shall make default in the payment of the
rent reserved herein or any item of additional rent
herein mentioned or any part of either or in making any
other payment herein provided: (1) within five (5) years
after notice or (2) if any execution or attachment shall
be issued against Tenant or any of Tenant's property
whereupon the demised premises shall be taken or occupied
or attempted to be taken or occupied by someone other
than Tenant: or (3) if Tenant shall make default with
respect to any other lease between Landlord and Tenant:
or (4) if Tenant shall fail to move into or take
possession of the premises within fifteen (15) days after
commencement of the term of this lease, of which fact
Landlord shall be the sole judge; then and in any of such
events Landlord may without notice, re-enter the demised
premises either by force or otherwise, and dispossess
Tenant by summary proceedings or otherwise: and the legal
representative of Tenant or other occupant of demised
premises and remove their effects and hold the premises
as if this lease had not been made, and Tenant hereby
waives the service of notice of intention to re-enter or
to institute legal proceedings to that end. If Tenant
shall make default hereunder prior to the date fixed as
the commencement of any renewal or extension of this
lease. Landlord may cancel and terminate such renewal or
extension agreement by written notice.
(c) If Tenant is presently in possession of the
demised premises pursuant to a lease in writing
heretofore made and if. before the commencement of the
term herein provided the aforesaid lease shall be
terminated or Tenant shall be dispossessed or shall
voluntarily or involuntarily vacate, surrender or remove
from the $ 16,287.00 to BE TRANSFERRED from PREVIOUS
LEASE for 34-03
14
demised premises, then this lease shall, at the option of
Landlord, be terminated, but Tenant shall nevertheless
remain liable as hereinbefore provided.
FORTIETH:-In case of any such default, re-entry REMEDIES OF LANDLORD
expiration and/or dispossess by summary proceedings or
otherwise, (a) the rent and additional rent shall become
due thereupon and be paid up to the time of such re-entry
dispossess and or expiration, together with such
expenses as Landlord may incur for legal expenses,
attorneys' fees, brokerage, and or putting the demised
premises in good order, or for preparing the same for
re-rental: (b) Landlord may re-let the premises or any
part or parts thereof, either in the name of Landlord or
otherwise, for a term or terms, which may at Landlords
option be less than or exceed the period which would
otherwise have constituted the balance of the term of
this lease and may grant concessions or free rent: and/or
(c) Tenant or the legal representatives of Tenant shall
also pay Landlord as liquidated damages for the failure
of Tenant to observe and perform said Tenant's covenants
herein contained, any deficiency between the rent hereby
reserved and/or covenanted to be paid and the net amount,
if any, of the rents collected on account of, the lease
or leases of the demised premises for each month of the
period which would otherwise have constituted the balance
of the term of this lease. The rent received from any
re-letting or re-lettings, but only for the unexpired
portion of this lease, shall be applied first to the
payment of Landlord's expenses in resuming possession and
re-letting the premises, which expenses shall include but
not be limited to attorneys' fees, brokerage commissions,
cleaning, repairs, painting and decoration. The balance,
if any, shall be applied in payment of all unpaid rent,
additional rent and other charges due from Tenant
hereunder. irrespective of whether the liability therefor
arose prior or subsequent to the date of the expiration
of the term hereof. Tenant hereby covenants and agrees to
pay to Landlord, within a reasonable time after demand
therefor shall be made, the balance, if any, remaining
unpaid. In the event that any re-letting hereunder
results in Landlord's receiving from Tenant in any month
an amount in excess of the amount due for such month,
then and in that event Tenant shall not be obligated to
make any payment to Landlord for rent due in such month,
nor shall Landlord at any time be obligated to make any
refund or apply any credit to Tenant with respect to such
rent, and Tenant shall have no claim by way of defense to
a suit or otherwise that Landlord has received for any
prior month or that any new tenant has agreed to pay for
any subsequent month a greater amount than that
hereinabove reserved to be paid as rent for that month.
The failure or refusal of Landlord to re-let the premises
or any part or parts thereof shall not release or affect
Tenant's liability for damages. Any security in
Landlord's possession not retained by it as liquidated
damages may be applied by it for any or all of the
aforesaid purposes. Any such liquidated damages shall be
paid as additional rent hereunder in monthly installments
by Tenant on the rent day specified in this lease and any
suit brought to collect the amount of the deficiency for
any month shall not prejudice in any way the rights of
Landlord to collect the deficiency for any subsequent
month by a similar proceeding. Landlord, at Landlord's
option, may make such alterations, repairs, replacements
and, or decorations in the demised premises as Landlord
in Landlord's sole judgment considers advisable and
necessary for the purpose of re-letting the demised
premises; and the making of such alterations and, or
decorations shall not operate or be construed to release
Tenant from liability hereunder as aforesaid. Landlord
shall in no event be liable in any way whatsoever for
failure to re-let the demised premises, or in the event
that the demised premises are re-let, for failure to
collect the rent thereof under such re-letting. In the
event of a breach or threatened breach by Tenant of any
of the covenants or provisions hereof. Landlord shall
have the right of injunction and the right to invoke any
remedy allowed at law or inequity as if re-entry, summary
proceedings and other remedies were not herein provided
for. Mention in this lease of any particular remedy,
shall not preclude Landlord from any other remedy, in law
or in equity.
FORTY-FIRST:-Notwithstanding anything elsewhere COURT ORDER RELATING
contained in this lease, if by reason of any present or TO RENT
future cause or thing whatsoever (including, without
limitation, by reason of any statute. ordinance,
judgment, decree, court order or governmental rule or
regulation). Tenant will not or shall not be required to
pay to Landlord the full amount of rent and additional
rent reserved hereunder. then Landlord, at its
unrestricted option, may give Tenant not less than live
(5) days' notice of intention to end this lease and the
term hereof, and thereupon, on the date specified in said
notice, this lease and the term hereof shall expire as
fully and completely as if that date were the date,
herein originally fixed for the expiration of this lease
and the term hereof.
FORTY-SECOND:-It is mutually agreed by and WAIVER OF TRIAL BY
between Landlord and Tenant that the respective parties JURY
hereto shall and they hereby do waive trial by jury in
any action, proceeding or counterclaim brought by either
of the parties hereto against the other on any matters
whatsoever arising out of or in any way connected with
this lease, the relationship of landlord and tenant.
Tenant's use or occupancy of said premises, except for
personal injury or property damage, or involving the
right to any statutory relief or remedy. Tenant will not
15
interpose any counterclaim of any nature in any summary
proceeding. The provisions of this paragraph shall be
binding upon the respective heirs, distributees,
executors, administrators, successors and assigns of the
parties hereto and all subtenants hereunder.
WAIVER OF FORTY-THIRD:--Tenant hereby expressly waives any and
REDEMPTION all rights of redemption granted by or under any present
or future laws in the event of Tenant being evicted or
dispossessed for any cause, or in the event of Landlord
obtaining possession of demised premises, by reason of
the violation by Tenant of any of the covenants and
conditions of this lease, or otherwise.
NO WAIVER FORTY-FOURTH:--(a) If there be any agreement between
Landlord and Tenant providing for the cancellation of
this lease upon certain provisions or contingencies,
and/or an agreement for the renewal hereof at the
expiration of the term first above mentioned, the right
to such renewal or the execution of a renewal agreement
between Landlord and Tenant prior to the expiration of
such first mentioned term shall not be considered an
extension thereof or a vested right in Tenant to such
further term, so as to prevent Landlord from cancelling
this lease and any such extension thereof during the
remainder of the original term hereby granted: such
privilege, if and when so exercised by Landlord, shall
cancel and terminate this lease and any such renewal or
extension previously entered into between said Landlord
and Tenant or the right of Tenant to any such renewal or
extension: any right herein contained on the part of
Landlord to cancel this lease shall continue during any
extension or renewal hereof; any option on the part of
Tenant herein contained for an extension or renewal
hereof shall not be deemed to give Tenant any option for
a further extension beyond the first renewal or extended
term.
(b) No act or thing done by Landlord or Landlord's
agents during the term hereby demised shall constitute an
actual or constructive eviction by Landlord, nor shall be
deemed an acceptance of a surrender of said demised
premises, and no agreement to accept such surrender shall
be valid unless in writing signed by Landlord. In the
event that any payment herein provided for by Tenant to
Landlord shall become overdue for a period in excess of
ten (10) days, then at Landlord's option a "late charge"
for such period and for each additional period of twenty
(20) days or any part thereof shall become immediately
due and owing to Landlord, as additional rent by reason
of the failure of Tenant to make prompt payment, at the
following rates: for individual and partnership tenants,
said late charge shall be computed at the maximum legal
rate of interest: for corporate or governmental entity
tenants the late charge shall be computed at two percent
per month unless there is an applicable maximum legal
rate of interest which then shall be used. No employee of
Landlord or of Landlord's agents shall have any power to
accept the keys of said premises prior to the termination
of the lease. The delivery of keys to any employee of
Landlord or of Landlord's agents shall not operate as a
termination of the lease or a surrender of the premises.
In the event of Tenant at any time desiring to have
Landlord sublet the premises for Tenant's account.
Landlord or Landlord's agents are authorized to receive
said keys for such purposes without releasing Tenant from
any of the obligations under this lease, and Tenant
hereby relieves Landlord of any liability for loss of or
damage to any of Tenant's effects in connection with such
subletting.
(c) The failure of Landlord to seek redress for
violation of, or to insist upon the strict performance
of, any covenant or condition of this lease, or any of
the Rules and Regulations set forth or hereafter adopted
by Landlord, shall not prevent a subsequent act, which
would have originally constituted a violation, from
having all the force and effect of an original violation.
The receipt by Landlord of rent with knowledge of the
breach of any covenant of this lease shall not be deemed
a waiver of such breach.
(d) The failure of Landlord to enforce any of the
Rules and Regulations set forth, or hereafter adopted,
against Tenant and, or any other tenant in the building
shall not be deemed a waiver of any such Rules and
Regulations. No provision of this lease shall be deemed
to have been waived by Landlord, unless such waiver be in
writing signed by Landlord.
(e) No payment by Tenant or receipt by Landlord of a
lessor amount than the monthly rent herein stipulated
shall be deemed to be other than on account of the
earliest stipulated rent, nor shall any endorsement or
statement on any check or any letter accompanying any
check or payment as rent be deemed an accord and
satisfaction, and Landlord may accept such check or
payment without prejudice to Landlord's right to recover
the balance of such rent or pursue any other remedy in
this lease provided.
LICENSE FORTY-FIFTH:--Tenant covenants that Tenant will not,
without the consent of Landlord first obtained in each
case, make or grant any license in respect of the demised
premises or any part thereof, or in respect of the use
thereof, and will not permit any such license to be made
or granted.
16
FORTY-SIXTH:-Landlord shall replace, at the expense GLASS AND GLASS
of Tenant, any and all plate and other glass damaged or INSURANCE
broken from any cause whatsoever in and about the demised
premises. Landlord may insure, and keep insured, at
Tenant's expense, all plate and other glass in the
demised premises for and in the name of Landlord. Bills
for the premiums therefor shall be rendered by Landlord
to Tenant at such times as Landlord may elect, and shall
be due from, and payable by Tenant when rendered, and
the amount thereof shall be deemed to be and be paid as,
additional rent.
FORTY-SEVENTH:-If an excavation shall be made ADJACENT
upon land adjacent to the demised premises, or shall be EXCAVATION-SHORING
authorized to be made, Tenant shall afford to the person
causing or authorized to cause such excavation, license
to enter upon the demised premises for the purpose of
doing such work as said person shall deem necessary to
preserve the wall or the building of which demised
premises form a part from injury or damage and to support
the same by proper foundations without any claim for
damages or indemnity against Landlord, or diminution or
abatement of rent.
FORTY-EIGHTH:-Except as otherwise in this lease BILLS AND
provided, a bill, statement, notice or communication NOTICES
which Landlord may desire or be required to give to
Tenant, shall be deemed sufficiently given or rendered if
in writing delivered to Tenant personally or sent by
registered or certified mail addressed to Tenant at the
building of which the demised premises form a part or at
the last known residence address or business address of
Tenant or left at any of the aforesaid premises addressed
to Tenant, and the time of the rendition of such bill or
statement and of the giving of such notice or
communication shall be deemed to be the time when the
same is delivered to Tenant, mailed, or left at the
premises as herein provided. Any notice by Tenant to
Landlord must be served by registered or certified mail
addressed to Landlord at the address first hereinabove
given or at such other address as Landlord shall
designate by written notice.
FORTY-NINTH:-If and so long as Tenant pays the QUIET
rent and additional rent reserved hereby and performs and ENJOYMENT
observes the covenants and provisions hereof, Tenant
shall quietly enjoy the demised premises, subject,
however, to the terms, conditions, exceptions and
reservations of this lease, and to the ground, underlying
and overriding leases and mortgages hereinbefore
mentioned.
FIFTIETH:-Upon the expiration or other termination QUIT AND
of the term of this lease, Tenant shall quit and SURRENDER
surrender to Landlord the demised premises, broom clean,
in good order and condition, ordinary wear excepted.
Lessee acknowledges that possession of the demised
premises must be surrendered to the Lessor at the
expiration or sooner termination of the term of this
Lease. Lessee agrees it shall indemnify and save Lessor
harmless against costs, claims, loss or liability
resulting from delay by Lessee in so surrendering the
demised premises, including, without limitation, any
claims made by any succeeding tenant, founded on such
delay. The parties recognize and agree that the damage to
Lessor resulting from any failure by Lessee timely to
surrender possession of the demised premises as aforesaid
will be extremely substantial, will exceed the amount of
monthly rent theretofore payable hereunder, and will be
impossible of accurate measurement. Lessee therefore
agrees that if possession of the demised premises is not
surrendered to Lessor within seven (7) days after the
date of the expiration or termination of the term of this
Lease, then Lessee agrees to pay Lessor as liquidated
damages for each month and for each portion of any month
during which Lessee holds over in the premises after
expiration or termination of the term of this Lease, a
sum equal to three times the average rent and additional
rent which was payable per month under this Lease during
the last six months of the term thereof. The aforesaid
provisions of this article shall survive the expiration or
sooner termination of the term of this Lease. If the last
day of the term of this lease or any renewal thereof
falls on Sunday, this lease shall expire on the business
day immediately preceding.
FIFTY-FIRST:-If Landlord shall be unable to give FAILURE
possession of the demised premises on the date of the TO GIVE
commencement of the term hereof for any reason, Landlord POSSESSION
shall not be subject to any liability. Under such
circumstances, the rent reserved and covenanted to be
paid herein shall not commence until the possession of
demised premises is given or the premises are available
for occupancy by Tenant, and no such failure to give
possesion on the date of commencement of the term shall
in any wise affect the validity of this lease or the
obligations of Tenant hereunder, nor shall same be
construed in any wise to extend the term of this lease.
If Landlord is unable to give possession of the demised
premises on the date of the commencement of the term
hereof by reason of the holding over or retention of
possession of any tenant, tenants or occupants or for any
other reason, or if repairs, improvements or decorations
of the demised premises or of the building of which said
premises form a part, are not completed, no abatement or
diminution of the rent to be paid hereunder shall be
allowed to Tenant nor shall the validity of the lease be
impaired under such circumstances. If permission is given
to Tenant to enter into the possession of the demised
premises or to occupy premises other
17
than the demised premises prior to the date specified as
the commencement of the term of this lease. Tenant
covenants and agrees that such occupancy shall be deemed
to be under all the terms, covenants, conditions and
provisions of this lease, except as to the covenant to
pay rent. In either case rent shall commence on the date
specified in this lease.
REPRESENTATIONS FIFTY--SECOND:-Landlord or Landlord's agents have
made no representations or promises with respect to the
said building or demised premises except as herein
expressly set forth. The taking possession of the demised
premises by Tenant shall be conclusive evidence, as
againt Tenant, that Tenant accepts same "as is" and that
said premises and the building of which the same form a
part were in good and satisfactory condition at the time
such possession was so taken.
RENT FIFTY-THIRD:--In the event the fixed annual rent or
CONTROL additional rent or any part thereof provided to be paid
by Lessee under the provisions of this lease during the
demised term shall become uncollectible or shall be
reduced or required to be reduced or refunded by virtue
of any Federal, State, County or City law, order or
regulation, or by any direction of a public officer or
body pursuant to law, or the orders, rules, code, or
regulations of any organization or entity formed pursuant
to law, whether such organization or entity be public or
private, then Lessor, at its option, may at any time
thereafter terminate this lease, by not less than thirty
(30) days' written notice to Lessee, on a date set forth
in said notice, in which event this lease and the term
hereof shall terminate and come to an end on the date
fixed in said notice as if the said date were the date
originally fixed herein for the termination of the
demised term. Lessor shall not have the right so to
terminate this lease if Lessee within such period of
thirty (30) days shall in writing lawfully agree that the
rentals herein reserved are reasonable rentals and agree
to continue to pay said rentals and if such agreement by
Lessee shall be legally enforceable by Lessor.
COVENANTS FIFTY-FOURTH:--The covenants, conditions and
BINDING agreements contained in this lease shall bind and inure
SUCCESSORS to the benefit of Landlord and Tenant and their
respective heirs, distributees, executors,
administrators, successors, and, except as otherwise
provided in this lease, their assigns.
LEASE FIFTY-FIFTH:--Except as may be otherwise contained
EMBODIES in a written instrument or instruments duly executed and
UNDERSTANDING OF delivered by and between the parties hereto, this lease
PARTIES contains the entire agreement and understanding of the
parties with respect to the demised premises and the
respective rights and duties of the parties in relation
thereto and in relation to each other. There are no oral
understandings or agreements between the parties of any
kind. Landlord has made no representations or warranties
to Tenant of any kind. All oral representations,
warranties and promises prior to or contemporaneous with
this written lease (if any be claimed) are and shall be
deemed merged into this lease. This lease cannot be
changed or supplemented orally. All promises and
agreements made by or between the parties subsequent to
the execution and delivery of this lease shall be and be
deemed to be null, void and unenforceable unless
contained in a writing duly executed and delivered by and
between the parties hereto, whether or not the same
relate in any way to this lease or any matter covered
hereby.
DEFINITIONS FIFTY-SIXTH:--(a) The term "Landlord" as used in
this lease means only the owner or the mortgagee in
possession for the time being of the land and building
(or the owner of a lease of the entire building or of the
land and entire building) of which the demised premises
form a part so that in the event of any sale or sales of
said land and entire building or of any transfer or
conveyance of said lease or in the event of a lease of
said entire building or of the land and entire building,
the said Landlord shall be and hereby is entirely freed
and relieved of all liability for the performance of all
covenants and obligations on the part of Landlord to be
performed hereunder, and it shall be deemed and
considered without further agreement between the parties
or other successors in interest or between the parties
and the purchaser at any such sale or any transferee or
mortgagee or any lessee of the entire building or of the
land and entire building that the purchaser, lessee,
transferee or grantee has assumed and agreed to carry out
any and all covenants and obligations of Landlord
hereunder. Tenant acknowledges that it has been informed
and understands that Landlord is a lessee of the land and
entire building of which the demised premises form a
part. The term "lease of the entire building or of the
land and entire building" shall be deemed to include a
sublease thereof, and the term "lessee of the entire
building or of the land and entire building" shall be
deemed to include a sublessee thereof.
(b) The words "re-entry" as used in this lease are
not restricted to their technical legal meaning.
(c) The term "business days" as used in this lease
shall exclude Saturdays (except such portion thereof as
is covered by the insertion of specific hours herein).
Sundays and all days observed by the State or Federal
Government as legal holidays.
18
(d) From time to time, Tenant, on at least ten (10)
days' prior written request by Landlord, will deliver to
Landlord a statement in writing certifying that this
lease is unmodified and in full force and effect (or if
there shall have been modifications, that the same is in
full force and effect as modified and stating the
modifications) and the dates to which the rent and other
charges have been paid and stating whether or not
Landlord is in default in performance of any covenant,
agreement or condition contained in this lease and if so,
specifying each such default of which Tenant may have
knowledge.
FIFTY-SEVENTH:--The fixed annual rent reserved in COST OF LIVING
this lease and payable hereunder shall be adjusted, as of ADJUSTMENTS
the times and in the manner set forth in this Article:
(SEE ALSO ARTICLE SIXTY NINTH)
(a) Definitions: For the purposes of this Article,
the following definitions shall apply;
(i) The term "Base Year" shall mean the full
calendar year 1994.
(ii) The term "Price Index" shall mean the 'Consumer
Price Index' published by the Bureau of Labor Statistics
of the U.S. Department of Labor, All Items, New York,
N.Y.-Northeastern, N.J., all urban consumers (presently
denominated "CPI-U"), or a successor or substitute index
appropriately adjusted.
(iii) The term "Price Index for the Base Year" shall
mean the average of the monthly All Items Price Indexes
for each of the 12 months of the Base Year.
(b) Effective as of each January and July subsequent
to the Base Year, there shall be made a cost of living
adjustment of the fixed annual rental rate payable
hereunder. The July adjustment shall be based on the
percentage difference between the Price Index for the
preceding month of June and the Price Index for the Base
Year. The January adjustment shall be based on such
percentage difference between the Price Index for the
preceding month of December and the Price Index for the
Base Year.
(i) In the event the Price Index for June in any
calendar year during the term of this lease reflects an
increase over the Price Index for the Base Year, then the
fixed annual rent herein provided to be paid as of the
July 1st following such month of June (unchanged by any
adjustments under this Article) shall be multiplied by
the percentage difference between the Price Index for
June and the Price Index for the Base Year, and the
resulting sum shall be added to such fixed annual rent,
effective as of such July 1st. Said adjusted fixed annual
rent shall thereafter be payable hereunder, in equal
monthly installments, until it is readjusted pursuant to
the terms of this lease.
(ii) In the event the Price Index for December in
any calendar year during the term of this lease reflects
an increase over the Price Index for the Base Year, then
the fixed annual rent herein provided to be paid as of
the January 1st following such month of December
(unchanged by any adjustments under this Article) shall
be multiplied by the percentage difference between the
Price Index for December and the Price Index for the Base
Year, and the resulting sum shall be added to such fixed
annual rent effective as of such January 1st. Said
adjusted fixed annual rent shall thereafter be payable
hereunder, in equal monthly installments, until it is
readjusted pursuant to the terms of this lease.
The following illustrates the intentions of the
parties hereto as to the computation of the
aforementioned cost of living adjustment in the annual
rent payable hereunder.
Assuming that said fixed annual rent is $10,000,
that the Price Index for the Base Year was 102.0 and that
the Price Index for the month of June in a calendar year
following the Base Year was 105.0, then the percentage
increase thus reflected, i.e. 2,941% (3.0/102.0) would be
multiplied by $10,000, and said fixed annual rent would
be increased by $294.10 effective as of July 1st of said
calendar year.
In the event that the Price Index ceases to use
82-84=100 as the basis of calculation or if a substantial
change is made in the terms or number of items contained
in the Price Index, then the Price Index shall be
adjusted to the figure that would have been arrived at
had the manner of computing the Price Index in effect at
the date of this lease not been altered. In the event
such Price Index (or a successor or substitute index) is
not available, a reliable governmental or other
non-partisan publication evaluating the information
theretofore used in determining the Price Index shall be
used.
No adjustments or recomputations, retroactive or
otherwise, shall be made due to any revision which may
later be made in the first published figure of the Price
Index for any month.
19
(c) Landlord will cause statements of the cost of
living adjustments provided for in subdivision (b) to be
prepared in reasonable detail and delivered to Tenant.
(d) In no event shall the fixed annual rent
originally provided to be paid under this lease
(exclusive of the adjustments under this Article) be
reduced by virtue of this Article.
(e) Any delay or failure of Landlord, beyond July or
January of any year, in computing or billing for the rent
adjustments hereinabove provided, shall not constitute a
waiver of or in any way impair the continuing obligation
of Tenant to pay such rent adjustments hereunder.
(f) Notwithstanding any expiration or termination of
this lease prior to the lease expiration date (except in
the case of a cancellation by mutual agreement) Tenant's
obligation to pay rent as adjusted under this Article
shall continue and shall cover all periods up to the
lease expiration date, and shall survive any expiration
or termination of this lease.
TAX ESCALATION FIFTY-EIGHTH:--Tenant shall pay to Landlord, as
additional rent, tax escalation in accordance with this
Article:
(a) Definitions: For the purpose of this Article,
the following definitions shall apply.
(i) The term "base tax year" as hereinafter set
forth for the determination of real estate tax
escalation, shall mean the New York City real estate
tax year commencing July 1, 1993 and ending June 30,
1994.
(ii) The term "The Percentage", for purposes of
computing tax escalation, shall mean and Twenty
hundredths of one percent (4.20%). The Percentage
has been computed on the basis of a fraction, the
denominator of which is the rentable square foot
area of the presently demised premises and the
denominator of which is the total rentable square
foot area of the office and commercial space in the
building project. The parties acknowledge and agree
that the rentable square foot area of the presently
demised premises shall be deemed to be
21,248______sq.ft. and that the total rentable
square foot area of the office and commercial space
in the building project shall be deemed to be
505,591_______sq.ft.
(iii) The term "the building project" shall
mean the aggregate combined parcel of land on a
portion of which are the improvements of which the
demised premises form a part, with all the
improvements thereon, said improvements being a part
of the block and lot for tax purposes which are
applicable to the aforesaid land.
(iv) The term "comparative year" shall mean the
twelve (12) months following the base tax year, and
each subsequent period of twelve (12) months (or
such other period of twelve (12) months occurring
during the term of this lease as hereafter may be
duly adopted as the fiscal year for real estate tax
purposes by the City of New York).
(v) The term "real estate taxes" shall mean the
total of all taxes and special or other assessments
levied, assessed or imposed at any time by any
governmental authority upon or against the building
project, and also any tax or assessment levied,
assessed or imposed at any time by any governmental
authority in connection with the receipt of income
or rents from said, building project to the extent
that same shall be in lieu of all or a portion of
any of the aforesaid taxes or assessments, or
additions or increases thereof, upon or against said
building project. If, due to a future change in the
method of taxation or in the taxing authority, or
for any other reason, a franchise, income, transit,
profit or other tax or governmental imposition,
however designated, shall be levied against Landlord
in substitution in whole or in part for the real
estate taxes, or in lieu of additions to or
increases of said real estate taxes, then such
franchise, income, transit, profit or other tax or
governmental imposition shall be deemed to be
included within the definition of "real estate
taxes" for the purposes hereof. As to special
assessments which are payable over a period of time
extending beyond the term of this lease, only a pro
rata portion thereof, covering the portion of the
term of this lease unexpired at the time of the
imposition of such assessment, shall be included in
"real estate taxes". If, by law, any assessment may
be paid in installments, then, for the purposes
hereof (a) such assessment shall be deemed to have
been payable in the maximum number of installments
permitted by law and (b) there shall be included in
real estate taxes, for each comparative year in
which such installments may be paid, the
installments of such assessment so becoming payable
during such comparative year, together with interest
payable during such comparative year.
20
(vi) Where a "transition assessment" is imposed
by the City of New York for any tax (fiscal) year,
then the phrases "assessed value" and "assessments"
shall mean the transition assessment for that tax
(fiscal) year.
(vii) The phrase "real estate taxes payable
during the base tax year" shall mean that amount
obtained by multiplying the assessed value of the
land and buildings of the building project for the
base tax year by the tax rate for the base tax year
for each $100 of such assessed value.
(b) 1. In the event that the real estate taxes
payable for any comparative year shall exceed the amount
of the real estate taxes payable during the base tax
year, Tenant shall pay to Landlord, as additional rent
for such comparative year, an amount equal to The
Percentage of the excess. Before or after the start of
each comparative year, Landlord shall furnish to Tenant a
statement of the real estate taxes payable for such
comparative year, and a statement of the real estate
taxes payable during the base tax year. If the real
estate taxes payable for such comparative year exceed the
real estate taxes payable during the base tax year,
additional rent for such comparative year, in an amount
equal to The Percentage of the excess, shall be due from
Tenant to Landlord, and such additional rent shall be
payable by Tenant to Landlord within ten (10) days after
receipt of the aforesaid statement. The benefit of any
discount for any earlier payment or prepayment of real
estate taxes shall accrue solely to the benefit of
Landlord, and such discount shall not be subtracted from
the real estate taxes payable for any comparative year.
2. Should the real estate taxes payable during the
base tax year be reduced by final determination of legal
proceedings, settlement or otherwise, then, the real
estate taxes payable during the base tax year shall be
correspondingly revised, the additional rent theretofore
paid or payable hereunder for all comparative years shall
be recomputed on the basis of such reduction, and Tenant
shall pay to Landlord as additional rent, within ten (10)
days after being billed therefor, any deficiency between
the amount of such additional rent as theretofore
computed and the amount thereof due as the result of such
recomputations. Should the real estate taxes payable
during the base tax year be increased by such final
determination of legal proceedings, settlement or
otherwise, then appropriate recomputation and adjustment
also shall be made.
3. If, after Tenant shall have made a payment of
additional rent under this subdivision (c), Landlord
shall receive a refund of any portion of the real estate
taxes payable for any comparative year after the base tax
year on which such payment of additional rent shall have
been based, as a result of a reduction of such real
estate taxes by final determination of legal proceedings,
settlement or otherwise, Landlord shall within ten (10)
days after receiving the refund pay to Tenant The
Percentage of the refund less The Percentage of expenses
(including attorneys' and appraisers, fees) incurred by
Landlord in connection with any such application or
proceeding. If, prior to the payment of taxes for
any comparative year, Landlord shall have obtained a
reduction of that comparative year's assessed valuation
of the building project, and therefore of said taxes,
then the term "real estate taxes" for that comparative
year shall be deemed to include the amount of Landlord's
expenses in obtaining such reduction in assessed
valuation, including attorneys' and appraisers' fees.
4. The statements of the real estate taxes to be
furnished by Landlord as provided above shall be
certified by Landlord and shall constitute a final
determination as between Landlord and Tenant of the real
estate taxes for the periods represented thereby, unless
Tenant within thirty (30) days after they are furnished
shall give a written notice to Landlord that it disputes
their accuracy or their appropriateness, which notice
shall specify the particular respects in which the
statement is inaccurate or inappropriate. If Tenant shall
so dispute said statement then, pending the resolution of
such dispute, Tenant shall pay the additional rent to
Landlord in accordance with the statement furnished by
Landlord.
5. In no event shall the fixed annual rent under
this lease (exclusive of the additional rents under this
Article) be reduced by virtue of this Article.
6. If the commencement date of the term of this
lease is not the first day of the first comparative year,
then the additional rent due hereunder for such first
comparative year shall be a proportionate share of said
additional rent for the entire comparative year, said
proportionate share to be based upon the length of time
that the lease term will be in existence during such
first comparative year. Upon the date of any expiration
or termination of this lease (except termination because
of Tenant's default) whether the same be the date
hereinabove set forth for the expiration of the term or
any prior or subsequent date, a proportionate share of
said additional rent for the comparative year during
which such expiration or termination occurs shall
immediately become due and payable by Tenant to Landlord,
if it was not theretofore already billed and paid. The
said proportionate share shall be based upon the length
of time that this lease shall have been in existence
21
during such comparative year. Landlord shall promptly
cause statements of said additional rent for that
comparative year to be prepared and furnished to Tenant.
Landlord and tenant shall thereupon make appropriate
adjustments of amounts then owing.
7. Landlord's and Tenant's obligations to make the
adjustments referred to in subdivision (6) above shall
survive any expiration or termination of this lease.
8. Any delay or failure of Landlord in billing any
tax escalation hereinabove provided shall not constitute
a waiver of or in any way impair the continuing
obligation of Tenant to pay such tax escalation
hereunder.
OCCUPANCY AND USE BY FIFTY-NINTH:--(A). Tenant acknowledges that its
TENANT continued occupancy of the demised premises, and the
regular conduct of its business therein, are of utmost
importance to the Landlord in the renewal of other leases
in the building, in the renting of vacant space in the
building, in the providing of electricity, air
conditioning, steam and other services to the tenants in
the building, and in the maintenance of the character and
quality of the tenants in the building. Tenant therefore
covenants and agrees that it will occupy the entire
demised premises and will conduct its business therein in
the regular and usual manner, throughout the term of this
lease. Tenant acknowledges that Landlord is executing
this lease in reliance upon these covenants and that
these covenants are a material element of consideration
inducing the Landlord to execute this lease. Tenant
further agrees that if it vacates the demised premises or
fails to so conduct its business therein, at any time
during the term of this lease, without the prior written
consent of the Landlord, then all rent and additional
rent reserved in this lease from the date of such breach
to the expiration date of this lease shall become
immediately due and payable to Landlord.
(B). The parties recognize and agree that the damage
to Landlord resulting from any breach of the covenants in
subdivision (A) hereof will be extremely substantial,
will be far greater than the rent payable for the balance
of the term of this lease, and will be impossible of
accurate measurement. The parties therefore agree that in
the event of a breach or threatened breach of the said
covenants, in addition to all of Landlord's other rights
and remedies, at law or in equity or otherwise, Landlord
shall have the right of injunction to preserve Tenant's
occupancy and use. The words "become vacant or deserted"
as used elsewhere in this lease shall include Tenant's
failure to occupy or use as by this Article required.
(C). If Tenant breaches either of the covenants in
subdivision (A) above, and this lease be terminated
because of such default, then, in addition to Landlord's
rights of re-entry, restoration, preparation for and
rerental, and anything elsewhere in this lease to the
contrary notwithstanding, Landlord shall retain its right
to judgment on and collection of Tenant's aforesaid
obligation to make a single payment to Landlord of a sum
equal to the total of all rent and additional rent
reserved for the remainder of the original term of this
lease, subject to future credit or repayment to Tenant in
the event of any rerenting of the premises by Landlord,
after first deducting from rerental income all expenses
incurred by Landlord in reducing to judgment or otherwise
collecting Tenant's aforesaid obligation, and in
obtaining possession of, restoring, preparing for and
re-letting the premises. In no event shall Tenant be
entitled to a credit or repayment for rerental income
which exceeds the sums payable by Tenant hereunder or
which covers a period after the original term of this
lease.
(D). If any provision of this article of this lease
or the application thereof to any person or circumstance
shall, to any extent, be invalid or unenforceable, the
remainder of this Article, or the application of such
provision to persons or circumstances other than those as
to which it is held invalid or unenforceable, shall not
be affected thereby, and each provision of this Article
and of this lease shall be valid and be enforced to the
fullest extent permitted by law.
SIXTIETH:--The Landlord shall be under no obligation
to provide access between the "A" Wing and the "B" Wing
on the floor of the premises demised herein, and any
passageways which may now or hereafter exist between said
wings may be discontinued at any time at the discretion
of the Landlord.
CAPTIONS SIXTY-FIRST:--The captions are inserted only as a
matter of convenience and for reference and in no way
define, limit or describe the scope of this lease nor the
intent of any provision thereof.
RULES AND SIXTY-SECOND:--Tenant and Tenant's servants,
REGULATIONS employees, agents, visitors, and licensees shall observe
faithfully, and comply strictly with, the Rules and
Regulations and such other and further reasonable
and non-discriminatory Rules and Regulations as Landlord
or Landlord's agents may from time to time adopt. Notice
of any additional rules or regulations shall be given in
such manner as Landlord may elect. In case Tenant
disputes the reasonableness of any additional Rule or
Regulation hereafter made or adopted by Landlord or
Landlord's agents, the parties hereto agree to submit the
question of the reasonableness of such Rule or Regulation
for decision to the
22
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
designate, whose determination shall be final and conclusive upon the parties
hereto. The right to dispute the reasonableness of any additional Rule or
Regulation upon Tenant's part shall be deemed waived unless the same shall be
asserted by service of a notice in writing upon Landlord within ten (10) days
after the adoption of any such additional Rule or Regulation. Nothing in this
lease contained shall be construed to impose upon Landlord any duty or
obligation to enforce the Rules and Regulations or terms, covenants or
conditions in any other lease, as against any other tenant and Landlord shall
not be liable to Tenant for violation of the same by any other tenant, its
servants, employees, agents, visitors or licensees.
The use in the demised premises of auxiliary heating devices, such as
portable electric heaters, heat lamps or other devices whose principal function
at the time of operation is to produce space heating, is prohibited.
SIXTY-THIRD:--It is understood and agreed that this lease is submitted to
Tenant on the understanding that it shall not be considered an offer and shall
not bind Landlord in any way until (i) Tenant has duly executed and delivered
duplicate originals to Landlord and (ii) Landlord has executed and delivered one
of said originals to Tenant.
(SEE RIDER ATTACHED)
23
In Witness Whereof, Landlord and Tenant have respectively signed and sealed this
lease as of the day and year first above written:
LANDLORD:
500/512 SEVENTH AVENUE ASSOCIATES
HELMSLEY-SPEAR, INC., AGENTS
- -------------------------------------
Witness for Landlord:
By: /s/ Irving Schneider
------------------------------------
EXECUTIVE VICE PRESIDENT
TENANT:
G-III LEATHER FASHIONS, INC.
- -------------------------------------
Witness for Tenant:
By: /s/ Alan Feller
------------------------------------
ACKNOWLEDGEMENTS.
LANDLORD PARTNERSHIP TENANT
State of New York ) State of New York )
ss. ss.
County of New York ) County of New York )
On this ____ day of ________, On this ____ day of ________,
19___, before me personally came 19___, before me personally came
________________________, to me known ________________________, to me known
and known to me to be a partner of and known to me to be a partner of
_____________________, a _____________________, a co-partnership,
co-partnership, mentioned and mentioned and described in, and which
described in, and which executed the executed the foregoing instrument, and
foregoing instrument, and the said the said ______ duly acknowledge to ___
______ duly acknowledge to me that he that he executed the said instrument for
executed the said instrument for and and on behalf of and with the authority
on behalf of and with the authority of said ____________ for the uses and
of said ____________ for the uses and purposes therein mentioned
purposes therein mentioned
INDIVIDUAL TENANT CORPORATE TENANT
State of New York ) State of New York )
ss. ss.
County of New York ) County of New York )
On this ____ day of ________, On this 15 day of JUNE, 1993,
19___, before me personally came before me personally came ALAN FELLER,
________________________, to me known to me known who being by me duly sworn
and known to me to be the individual did depose and say that resides at 345
described in, and who executed, the West 37th Street NEW YORK, NEW YORK.
forgoing instrument, and acknowledge that he is the SECRETARY AND TREASURER
to me that he executed the same. OF G-III LEATHER FASHIONS INC. the
corporation described in and which
executed the forgoing instrument and
that he signed his name thereto by order
of the Board of Directors said
corporation
THOMAS D. PATTI
NOTARY PUBLIC State of New York
NO. 31-8296075
Qualified in New York County
Commission Expires January 31, 1995
24
TWENTY-FIFTH-A
AIR TWENTY-FIFTH-A With reference to the 35th Floor part of
CONDITIONING the demised premises Tenant shall have the privilege of
using the air conditioning system which affects the whole
or a portion of the demised premises, and shall, at its
own cost and expense, maintain and operate said system in
compliance with all present and future laws and
governmental requirements, and shall obtain all
governmental licenses and permits now or hereafter
required. Tenant shall pay for all electric current,
water and refrigerants used in connection, with said
system. Tenant, at its own cost and expense, shall make
or cause to be made, all repairs, alterations, changes,
additions or improvements in and to said system which may
be necessary or which may be required or recommended by
Landlord or by any governmental authority, and shall
furnish all parts and supplies necessary or desirable in
connection therewith, but no alterations, changes,
additions or improvements shall be made by Tenant without
the advance written consent of Landlord. Landlord's
charges for electric current, water and refrigerants and
for such parts, supplies, repairs, alterations, changes,
additions or improvements as are caused to be furnished
or made by Landlord shall be payable by Tenant as
additional rent upon presentation of Landlord's bill for
same. If Tenant shall default in paying any such bill for
five (5) days, Landlord shall have the right, in addition
to any other rights under this lease to terminate the
operation of said air conditioning system without notice
to Tenant, and if such default shall continue for sixty
(60) days, Landlord shall have the right to remove the
whole or any part of said system from the demised
premises without notice to Tenant. The non-functioning or
defective functioning of said air conditioning system, or
Tenant's inability to operate or maintain the same in
compliance with lawful requirements, or Landlord's
removal thereof or termination of the operation thereof
as provided in this paragraph, or any delay, discomfort
or inconvenience suffered by Tenant in connection
therewith, or, without limitation of or by the foregoing,
any other matter or thing related to such system, shall
not give rise to any obligation or liability on the part
of Landlord and shall not affect this lease or be deemed
to release or discharge Tenant of any of Tenant's
obligations or liabilities under this lease or otherwise.
Title to said system and all present and future parts
thereof is and shall be vested in Landlord.
ADDITIONAL CLAUSES attached to and forming a part of lease dated June
__, 1993 between 500-512 SEVENTH AVENUE ASSOCIATES and G-III LEATHER FASHIONS,
INC.
SIXTY FOURTH: It is understood and agreed tenant shall be permitted to list its
firm name or divisions of its firm but no more than five (5) listings in the
lobby board of the building. The charge to the tenant shall be $75.00 for all
listings plus tax, per side of building or the charge then in effect.
SIXTY FIFTH: (a) It is understood and agreed that tenant shall have immediate
possession of the demised premises free of rent upon execution of this lease
through December 31, 1993, but shall be subject to all other terms and
conditions of this lease including the payment of electricity.
(b) From and after the execution of this Lease by Landlord and
Tenant, and delivery to Tenant of a fully-executed copy thereof Tenant may
continue to occupy 34-03 at its present fixed and additional rent and upon its
commencement of construction of its Initial Alteration Work, (as hereinafter
defined), Landlord will make space in the building available to Tenant, on a
temporary basis, (the "Temporary Space"). The term of such occupancy shall end
on December 31, 1993 but will be extended to February 28, 1994 if Tenant's
Initial Work is not substantially completed by December 31, 1993. Tenant agrees
to take possession of the Temporary Space in its "as is" condition with no
obligation in Landlord to do any work therein or thereto to make such space
suitable and ready for Tenant's occupancy and use. Tenant shall surrender
broom-clean possession to landlord of the Temporary Space on or before December
31, 1993. For the Temporary Space, Tenant shall pay fixed rental of $15 per
square foot calculated on a maximum of 4,300 square feet, plus electricity.
Otherwise, Tenant's occupancy and use of the Temporary Space shall be pursuant
to all of the applicable provisions of this Lease.
In the event that Tenant shall fail timely to vacate and
surrender the Temporary Space by December 31, 1993 or any extension thereof,
then Tenant shall pay to Landlord, as liquidated damages, for each month or
portion thereof during which Tenant continues to occupy the Temporary Space
after the commencement date of the term of this Lease, a sum equal to $30 per
square foot, it being agreed that the damage to landlord resulting from the
failure by Tenant to timely vacate and surrender the Temporary Space will be
substantial and will be impossible of accurate measurement.
(c) Notwithstanding any of the foregoing it is expressly
understood and agreed that the monthly Rent and Additional Rent payments for the
demised premises shall begin on January 1, 1994 whether or not Tenant has
completed its Initial Alteration Work.
SIXTY SIXTH: Tenant shall perform all initial alteration work to make the
demised premises suitable and ready for Tenant's occupancy and use (the "Initial
Alteration Work"). Tenant shall, within sixty (60) days after the execution of
this Lease by Tenant, furnish Landlord for its approval a complete set of
architectural and engineering plans and specifications for such work including
air conditioning. Landlord, promptly upon receipt of same, shall approve such
plans and specifications, or return them with advice as to what changes are
required for its approval to be forthcoming.
Tenant, at its own cost and expense (except as herein provided), will
cause the Initial Alteration Work to be effected in accordance with Tenant's
approved plans and specifications, pursuant to the provisions of Article TWELFTH
and FIFTEENTH, as supplemented by Article SIXTEENTH, hereof, and in accordance
with all applicable laws, rules and regulations.
Tenant as part of its Initial Alteration Work will install an air
conditioning unit or units sufficient to air condition all or part of the
demised premises. In connection therewith Tenant agrees to pay as Additional
Rent an Electric Riser Charge of $5.00 per ton, per month for each unit.
SIXTY SEVENTH: Provided Tenant is not then in material default under this Lease
beyond any grace period, landlord will pay up to the first $488,704 ("Landlord's
Work Contribution") of the costs of labor and materials, excluding the costs of
Tenant's personal property, in effecting the Initial Alteration Work. If such
costs are lower than $488,704, then Landlord's aforedescribed contribution
obligation shall be satisfied by its paying such amount lower than $488,704. Any
such costs in excess of $488,704 shall be paid promptly by Tenant.
In connection with the Initial Alteration Work, Tenant shall provide
Landlord with true copies of paid bills, showing the cost of the items of the
Initial Alteration Work to be included in the aforesaid total up to $488,704,
and Landlord shall reimburse Tenant for the amount set forth in said bills in
accordance with Landlord's obligation hereunder within twenty (20) days unless
Landlord requests further verification of payment.
-2-
SIXTY EIGHTH: Landlord AGREES that, at its expense, it shall effect the
following work ("Landlord's Work") in and to the demised premises, in a Building
standard manner and using Building standard materials, which work shall
constitute Landlord's sole obligation hereunder:
1. Install bathrooms as required pursuant to the Americans With
Disabilities Act. Landlord will use best efforts to coordinate its
construction with that of Tenant.
2. Remove existing installations from 35th Floor and from the portion of
the 34th Floor not presently occupied by Tenant So that same shall be
delivered vacant and free of same in "shell" condition.
SIXTY NINTH: Anything in Article FIFTY-SEVENTH to the contrary notwithstanding,
the cost of living adjustment of the fixed annual rental rate computed as
provided in said Article FIFTY-SEVENTH, which shall be payable for any single
calendar year, or for any portion thereof, shall not exceed an amount equal to
four (4%) of the fixed annual rental rate payable under this lease as of
December 1st of the immediately preceding calendar year (including any
Adjustments Under Article FIFTY-SEVENTH).
Please note that this limitation in intended to operate as follows: if
the Base Year fixed annual rental rate is $10,000, and the percentage limitation
is, say, 4%, then the maximum escalation for the first calendar year following
the Base Year is 4% X $10,000, or $400 (for a maximum rental of $10,400); the
maximum escalation for the second calendar year following the Base Year is 4% X
$10,400, or $416 (for a maximum rental of $10,816}; for the third year, the
maximum escalation is 4% X $10,816, or $432.64 (for a maximum rental of
$11,248.64), etc.
SEVENTYTH: Anything to the contrary contained in Article Thirty-Fifth
notwithstanding, should Landlord elect not to give such notice of termination
and the demised premises are not restored so that Tenant may resume its regular
course of business operations within 180 days after such fire or other cause,
Tenant shall have the right to give Landlord a notice in writing of termination,
which notice shall be given as provided in this Lease
-3-
and thereupon the term of this Lease shall expire by lapse of time on the third
day after such notice is given, and Tenant shall vacate the demised premises and
surrender same to Landlord.
LANDLORD:
500-512 SEVENTH AVENUE ASSOCIATES
HELMSLEY-SPEAR, INC., AGENTS
By: /s/ Irving Schneider
------------------------------------
EXECUTIVE VICE PRESIDENT
TENANT:
G-III LEATHER FASHIONS, INC.
By: /s/ Alan Feller
------------------------------------
-4-
RULES AND REGULATIONS
1. The sidewalks, entrances, passages, courts, elevators, vestibules,
stairways, corridors or halls shall not be obstructed or encumbered by any
Tenant or used for any purpose other than ingress and egress to and from the
demised premises, and if said premises are situate on the ground floor of the
building the Tenant thereof shall further, at said Tenant's own expense, keep
the sidewalks and curb directly in front of said premises clean and free from
ice, snow, etc.
2. The freight and not the passenger elevators shall be used by the working
hands of Tenant and persons calling for and delivering goods to and from the
demised premises.
3. No awnings or other projections shall be attached to the outside walls
of the building without the prior written consent of Landlord. No curtains,
blinds, shades or screens shall be attached to or hung in, or used in connection
with, any window or door of the demised premises, without the prior written
consent of the Landlord. Such awnings, projections curtains, blinds, shades,
screens or other fixtures must be of a quality, type, design and color, and
attached in the manner approved by Landlord.
4. No sign, advertisement, notice or other lettering shall be exhibited,
inscribed, painted or affixed by any Tenant on any part of the outside or inside
of the demised premises or building without the prior written consent of
Landlord. Interior signs on doors shall be inscribed, painted or affixed for
each Tenant by Landlord at the expense of such Tenant, and shall be of a size,
color and style acceptable to Landlord. Only the Tenant named in the lease shall
be entitled to appear on the Directory Board or Tablet. Additional names may be
added in Landlord's sole discretion under such terms and conditions as he may
approve.
5. The sashes, sash doors, skylights, windows and doors that reflect or
admit light and air into the halls, passageways or other public places in the
building shall not be covered by any Tenant, nor shall any bottles, parcels, or
other articles be placed on the windowsills.
6. The water and wash closets and other plumbing fixtures shall not be used
for any purposes other than those for which they were constructed, and no
sweepings, rubbish, rags, or other substances shall be thrown therein. All
damages resulting from any misuse of the fixtures shall be borne by Tenant who,
or whose servants, employees, agents, visitors or licensees, shall have caused
the same.
7. No Tenant shall mark, paint, drill into, or in any way deface any part
of the demised premises or the building of which they form a part. No boring,
cutting or stringing of wires shall be permitted, except with the prior written
consent of Landlord, and as Landlord may direct. No linoleum or other floor
covering shall be laid in direct contact with the floor of the demised premises,
but if any such covering is required by Tenant, an interlining of builder's
deadening felt shall first be affixed to the floor with paste or other water
soluble material, the use of cement or other adhesive non-soluble in water is
expressly prohibited.
8. No Tenant shall make, or permit to be made, any unseemly or disturbing
noises or disturb or interfere with occupants of this or neighboring buildings
or premises or those having business with them whether by the use of any
instrument, radio, talking machine, musical noise, whistling, singing or in any
other way.
9. No Tenant, nor any of Tenant's servants, employees, agents, visitors, or
licensees, shall at any time bring or keep upon the demised premises any
inflammable, combustible or explosive fluid, chemical and substance, or cause or
permit any unusual or objectionable odors to be produced upon or permeate from
the demised premises. No animals or birds shall be kept by Tenant in or about
the building.
10. Landlord reserves the right to inspect all freight to be brought into
the building and to exclude from the building all freight which violates any of
these Rules and Regulations or the lease of which these Rules and Regulations
are a part.
11. Landlord shall have the right to prohibit any advertising by any Tenant
which, in its opinion, tends to impair the reputation of the building or its
desirability and, upon written notice from Landlord. Tenant shall refrain from
or discontinue such advertising.
12. Canvassing, soliciting and peddling in the building is prohibited and
each Tenant shall co-operate to prevent the same.
13. There shall not be used in any space, or in the public halls of any
building, either by any Tenant or by jobbers or others, in the delivery or
receipt of merchandise, any hand trucks, except those equipped with rubber tires
and side guards.
14. No Tenant shall purchase spring water, ice, towels, or other like
service, from any company or persons not approved by Landlord.
15. The use in the demised premises of auxiliary heating devices, such as
portable electric heaters, heat lamps or other devices whose principal function
at the time of operation is to produce space heating, is prohibited.
26
[MAP OMITTED]
NAVARRE MERCANTILE BUILDING, S.W. Corner 7th Ave & 38th Street
[MAP OMITTED]
NAVARRE MERCANTILE BUILDING, S.W. Corner 7th Ave & 38th Street
EXECUTION COPY
1 of 7
================================================================================
FIRST AMENDMENT TO LEASE
BETWEEN
500-512 SEVENTH AVENUE LIMITED PARTNERSHIP, LANDLORD
AND
G-lll LEATHER FASHIONS, INC., Tenant
PREMISES:
ENTIRE 34TH AND 35TH FLOORS
512 SEVENTH AVENUE
NEW YORK, NEW YORK
================================================================================
FIRST AMENDMENT TO LEASE
THIS FIRST AMENDMENT TO LEASE (this "Amendment") made as of the 1st day of
July, 2000, by and between 500-512 SEVENTH AVENUE LIMITED PARTNERSHIP, a New
York limited partnership, having an office c/o Newmark & Company Real Estate,
Inc. ("Landlord"), and G-lll LEATHER FASHIONS, INC., a New York corporation,
having an office at 512 Seventh Avenue, New York, New York ("Tenant").
WITNESSETH:
WHEREAS, by Agreement of Lease dated as of June, 1993 (such lease, as the
same may have been or may hereafter be amended, is hereinafter called the
"Lease"), Landlord's predecessor-in-interest, did demise and let unto Tenant and
Tenant did hire and take from Landlord's predecessor-in-interest the entire
thirty-fourth (34th) and thirty-fifth (35th) floors (collectively, the "demised
premises") as more particularly described in the Lease in the building (the
"Building") known by the street address 512 Seventh Avenue, New York, New York;
WHEREAS, the term of the Lease currently expires on January 31, 2003;
WHEREAS, Tenant desires to extend the term of the Lease and Landlord is
agreeable thereto on the terms and conditions hereinafter set forth; and
WHEREAS, Landlord and Tenant desire to modify and amend the Lease as
hereinafter provided.
NOW, THEREFORE, for and in consideration of the mutual covenants herein
contained and other good and valuable consideration, the adequacy and receipt of
which are hereby acknowledged, Landlord and Tenant hereby agree as follows:
1. All capitalized terms used herein shall have the meanings ascribed to
them in the Lease unless otherwise specifically set forth herein to the
contrary.
2. The term of the Lease is hereby extended for an additional term (the
"Extended Term") of ten (10) years and nine (9) months commencing on July 1,
2000 (the "Extended Term Commencement Date") and ending on March 31, 2011 (the
"Expiration Date"), as if the Expiration Date was originally set forth in the
Lease as the expiration date thereof, instead of January 31, 2003.
3. Effective as of the first day of the Extended Term:
(a) The fixed annual rent to be paid by Tenant to Landlord under the
Lease during the Extended Term shall be abated during the period commencing on
the Extended Term Commencement Date and ending on December 31, 2000, and
thereafter shall be payable as follows:
(i) For the period commencing on January 1, 2001 and ending on
December 31, 2001, the fixed annual rent shall be Five Hundred Fifty Two
Thousand Four Hundred Forty-Eight and 00/100 Dollars ($552,448.00) per year, or
Forty Six Thousand Thirty-Seven and 33/100 Dollars ($46,037.33) per month;
(ii) For the period commencing on January 1, 2002 and ending on
December 31, 2002, the fixed annual rent shall be Five Hundred Sixty-Nine
Thousand Twenty-One and 44/100 Dollars ($569,021.44) per year, or Forty-Seven
Thousand Four Hundred Eighteen and 45/100 Dollars ($47,418.45) per month;
(iii) For the period commencing on January 1, 2003 and ending on
December 31, 2003, the fixed annual rent shall be Five Hundred Eighty-Six
Thousand Ninety-Two and 08/100 Dollars ($586,092.08) per year, or Forty-Eight
Thousand Eight Hundred Forty-One and 01/100 Dollars ($48,841.01) per month;
(iv) For the period commencing on January 1, 2004 and ending on
December 31, 2004, the fixed annual rent shall be Six Hundred Three Thousand Six
Hundred Seventy-Four and 85/100 Dollars ($603,674.85) per year, or Fifty
Thousand Three Hundred Six and 24/100 Dollars ($50,306.24) per month;
(v) For the period commencing on January 1, 2005 and ending on
December 31, 2005, the fixed annual rent shall be Six Hundred Twenty-One
Thousand Seven Hundred Eighty Five and 09/100 Dollars ($621,785.09) per year, or
Fifty-One Thousand Eight Hundred Fifteen and 42/100 Dollars ($51,815.42) per
month;
(vi) For the period commencing on January 1, 2006 and ending on
December 31, 2006, the fixed annual rent shall be Seven Hundred Twenty-Five
Thousand Three Hundred Fifty-Nine and 97/100 Dollars ($725,359.97) per year, or
Sixty Thousand Four Hundred Forty-Six and 66/100 Dollars ($60,446.66) per month;
-2-
(vii) Notwithstanding anything to the contrary contained herein,
for the period commencing on January 1, 2006 and ending on March 31, 2006, the
fixed annual rent shall be abated;
(viii) For the period commencing on January 1, 2007 and ending on
December 31, 2007, the fixed annual rent shall be Seven Hundred Forty-Four
Thousand Five Hundred Seventy One and 01/100 Dollars ($744,571.01) per year, or
Sixty-Two Thousand Forty-Seven and 58/100 Dollars ($62,047.58) per month;
(ix) For the period commencing on January 1, 2008 and ending on
December 31, 2008, the fixed annual rent shall be Seven Hundred Sixty-Four
Thousand Three Hundred Fifty-Eight and 38/100 Dollars ($764,358.38) per year, or
Sixty-Three Thousand Six Hundred Ninety-Six and 53/100 Dollars ($63,696.53) per
month;
(x) For the period commencing on January 1, 2009 and ending on
December 31, 2009, the fixed annual rent shall be Seven Hundred Eighty-Four
Thousand Seven Hundred Thirty-Nine and 38/100 Dollars ($734,739.38) per year, or
Sixty Five Thousand Three Hundred Ninety-Four and 95/100 ($65,394.95) per month;
and
(xi) For the period commencing on January 1, 2010 and ending on
December 31, 2010, the fixed annual rent shall be Eight Hundred Five Thousand
Seven Hundred Thirty-One and 80/100 Dollars ($805,731.80) per year, or
Sixty-Seven Thousand One Hundred Forty-Four and 32/100 Dollars ($67,144.32) per
month; and
(xii) For the period commencing on January 1, 2011 and ending on
March 31, 2011, the fixed annual rent shall be Eight Hundred Twenty-Seven
Thousand One Hundred Eighty-Four and 64/100 Dollars ($827,184.64) per year, or
Sixty-Eight Thousand Nine Hundred Thirty-Two and 05/100 Dollars ($68,932.05) per
month.
Except as set forth above, the fixed annual rent shall be paid by
Tenant to Landlord in equal monthly installments in advance on the first day of
each and every month without any set-off or deduction whatsoever in the manner
provided in the Lease.
(b) The Fourth Article of the Lease is hereby deleted and the
following is substituted therefor:
-3-
"Tenant shall use and occupy the demised premises for showroom,
design, general offices and sales offices for sale at wholesale
and not retail, of all apparel and accessories."
(c) The Tenth Article of the Lease is hereby deleted and the
following is substituted therefor:
"TENTH: - (i) Tenant shall not (A) assign or otherwise transfer this Lease
or the term and estate hereby granted, (B) sublet the demised premises or
any part thereof or allow the same to be used or occupied by others or in
violation of Fourth Article hereof, (C) mortgage, pledge or encumber this
Lease or the demised premises or any part thereof in any manner or permit
any lien to be filed against this Lease, the demised premises or the
Building by reason of any act or omission on the part of Tenant or enter
into any agreement which would permit the filing of a lien by any broker
(except for a broker's agreement in connection with a proposed assignment
by Tenant of its rights and obligations under the Lease or a sublease of
all or a portion of the demised premises), or (D) advertise, or authorize a
broker to advertise, for a subtenant or an assignee at a specified rental
rate, without, in each instance, obtaining the prior consent of Landlord,
except as otherwise expressly provided in this Article 10. For purposes of
this Article 10, (w) the transfer of a majority of the issued and
outstanding capital stock of any corporate tenant, or of a corporate
subtenant, or the transfer of a majority of the total interest in any
partnership tenant or subtenant, however accomplished, whether in a single
transaction or in a series of related or unrelated transactions, shall be
deemed an assignment of this Lease, or of such sublease, as the case may
be, except that the transfer of the outstanding capital stock of any
corporate tenant, or subtenant, shall be deemed not to include the sale of
such stock by persons or parties, through the "over-the-counter market" or
through any recognized stock exchange, other than those deemed "insiders"
within the meaning of the Securities Exchange Act of 1934 as amended
(provided, however, that any transfer of stock of Tenant or any affiliate
of Tenant by Morris Goldfarb to members of his immediate family for estate
planning purposes shall not be deemed to effect an assignment of the
Lease), (x) a takeover agreement shall be deemed a transfer of this Lease,
(y) any person or legal representative of Tenant, to whom Tenant's interest
under this Lease passes by
-4-
operation of law, or otherwise, shall be bound by the provisions of this
Article 10, and (z) a modification, amendment or extension of a sublease
shall be deemed a sublease.
(ii) The provisions of subparagraph (i) hereof shall not apply to
transactions with a corporation into or with which Tenant is merged or
consolidated or with an entity to which substantially all of Tenant's
assets are transferred or, if Tenant is a partnership, with a successor
partnership (provided such merger or transfer of assets is for a good
business purpose and not principally for the purpose of transferring the
leasehold estate created hereby, and provided further, that either the (x)
the assignee has a net worth at least equal to or in excess of the net
worth of Tenant immediately prior to such merger or transfer, or (y) such
assignee delivers a letter of credit, in the form annexed hereto as Exhibit
A, in the amount equal to the product of (A) twelve (12) and (B) the then
prevailing monthly fixed rent).
(iii) Any assignment or transfer, whether made with Landlord's consent as
required by subparagraph (i) or without Landlord's consent pursuant to
subparagraph (ii) hereof, shall be made only if, and shall not be effective
until, the assignee shall execute, acknowledge and deliver to Landlord a
recordable agreement (unless the assignment shall be a "deemed" assignment
by reason of a transfer of a majority interest in Tenant), in form and
substance reasonably satisfactory to Landlord, whereby the assignee shall
assume the obligations and performance of this Lease and agree to be
personally bound by and upon all of the covenants, agreements, terms,
provisions and conditions hereof on the part of Tenant to be performed or
observed and whereby the assignee shall agree that the provisions of
subparagraph (i) hereof shall, notwithstanding such an assignment or
transfer, continue to be binding upon it in the future. Tenant covenants
that, notwithstanding any assignment or transfer, whether or not in
violation of the provisions of this Lease, and notwithstanding the
acceptance of fixed annual rent by Landlord from an assignee or transferee
or any other party, Tenant shall remain fully and primarily liable for the
payment of the fixed annual rent and additional rent due and to become due
under this Lease and for the performance of all of the covenants,
agreements, terms, provisions and conditions of this Lease on the part of
Tenant to be performed or observed.
(iv) The liability of Tenant, and the due performance by Tenant of the
obligations on its part to be performed under this Lease, shall not
-5-
such payment within thirty (30) days after the giving of such notice,
then Tenant shall be entitled to offset the amount not paid against
the next rent coming due under the Lease. Notwithstanding anything
herein to the contrary, such offset right shall not be binding upon
nor inure to any mortgagee or superior lessor.
(E) If pursuant to the exercise of any of Landlord's options pursuant
to this subparagraph (v) this Lease is terminated as to only a portion of
the demised premises, then the fixed annual rent payable hereunder and the
additional rent payable pursuant to the terms of this Lease shall be
adjusted in proportion to the portion of the demised premises affected by
such termination.
(vi) In the event that Landlord does not exercise any of the options
available to it pursuant to subparagraph (v) hereof, Landlord shall not
unreasonably withhold or delay its consent to an assignment of this Lease
or a subletting of the whole or any part of the demised premises for
substantially the remainder of the term of this Lease, provided:
(A) Tenant shall furnish Landlord with the name and business address
of the proposed subtenant or assignee and information with respect to the
nature and character of the proposed subtenant's or assignee's business, or
activities, such references and current financial information with respect
to net worth, credit and financial responsibility as are reasonably
satisfactory to Landlord, and an executed counterpart of the sublease or
assignment agreement;
(B) The proposed subtenant or assignee is a party whose financial net
worth, credit and financial responsibility is, considering the
responsibilities involved, reasonably satisfactory to Landlord;
(C) The nature and character of the proposed subtenant or assignee,
its business or activities and intended use of the demised premises is, in
Landlord's reasonable judgment, in keeping with the standards of the
Building and the floor or floors on which the demised premises are located;
(D) The proposed subtenant or assignee is not then an occupant of any
part of the Building or a party who dealt with Landlord or Landlord's agent
(directly or through a broker) with respect
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to space in the Building during the six (6) months immediately preceding
Tenant's request for Landlord's consent;
(E) All costs incurred with respect to providing reasonably
appropriate means of ingress and egress from the sublet space or to
separate the sublet space from the remainder of the demised premises shall,
subject to the provisions of this Lease with respect to alterations,
installations, additions or improvements be borne by Tenant;
(F) Each sublease shall specifically state that (x) it is subject to
all of the applicable terms, covenants, agreements, provisions, and
conditions of this Lease, (y) the subtenant will not have the right to a
further sublease thereunder (except the subtenant of an entire floor of the
demised premises shall have all the rights to assign and sublease afforded
to the named Tenant herein (i.e., G-III Leather Fashions, Inc.); provided,
notwithstanding the provisions of subparagraph (vii)(B) of this Article 10,
such subtenant shall pay to Landlord any and all rents, additional charge
or other consideration payable under such sub-sublease or otherwise to
subtenant by the sub-subtenant which is in excess of the fixed annual rent
and additional rent accruing during the term of such sub-sublease in
respect of the sub-subleased space (at the rate per square foot payable by
subtenant thereunder) pursuant to the terms of this Lease (including, but
not limited to, sums paid for the sale or rental of subtenant's fixtures,
leasehold improvements, equipment, furniture or other personal property,
less, in the case of the sale thereof, the then net unamortized or
undepreciated cost thereof determined on the basis of subtenant's federal
income tax returns), and less the reasonable costs of effecting such
transaction, including, without limitation, brokerage commissions, legal
fees and build out costs, or to allow the demised premises to be used by
others, without the consent of Landlord in each instance, and (z) a consent
by Landlord thereto shall not be deemed or construed to modify, amend or
affect the terms and provisions of this Lease, or Tenant's obligations
hereunder, which shall continue to apply to the premises involved, and the
occupants thereof, as if the sublease had not been made;
(G) Tenant shall together with requesting Landlord's consent
hereunder, have paid Landlord any reasonable out-of-pocket costs incurred
by Landlord to review the requested consent including any attorneys fees
incurred by Landlord;
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(H) The proposed subtenant or assignee is not (w) a retail branch of a
bank trust company, safe deposit business, savings and loan association or
loan company; (x) an employment or recruitment agency; (y) school, college,
university or educational institution whether or not for profit; (z) a
government or any subdivision or agency thereof;
(I) In the case of a subletting of a portion of the demised premises,
the layout of the portion so sublet shall be commercially reasonable and
suitable for normal renting purposes and such subletting will not result in
more than two (2) occupants (including Tenant) occupying the demised
premises; and
(J) Tenant shall not have advertised or listed with any brokers the
proposed assignment or subletting at a rental rate less than the rental
rates then being charged under leases being entered into by Landlord for
comparable space in the Building.
(vii) If Tenant shall assign this Lease or sublease all or any part of the
demised premises, Tenant shall pay to Landlord, as additional rent:
(A) in the case of an assignment, an amount equal to one-quarter (1/4)
of all sums and other considerations paid to Tenant by the assignee for or
by reason of such assignment or otherwise (including, but not limited to,
sums paid for the sale of Tenant's fixtures, leasehold improvements,
equipment, furniture, furnishings or other personal property, less, in the
case of a sale thereof, the then net unamortized or undepreciated cost
thereof determined on the basis of Tenant's federal income tax returns);
and
(B) in the case of a sublease, one-quarter (1/4) of the amount equal
to any and all rents, additional charge or other consideration payable
under the sublease or otherwise to Tenant by the subtenant which is in
excess of the fixed annual rent and additional rent accruing during the
term of the sublease in respect of the subleased space (at the rate per
square foot payable by Tenant hereunder) pursuant to the terms hereof
(including, but not limited to, sums paid for the sale or rental of
Tenant's fixtures, leasehold improvements, equipment, furniture or other
personal property, less, in the case of the sale thereof, the then net
unamortized or undepreciated cost thereof determined on the basis of
Tenant's federal income tax returns).
-11-
The sums payable under this subparagraph (vii) shall be paid to Landlord as
and when paid by the subtenant or assignee, as the case may be, to Tenant.
(viii) If Tenant defaults in the payment of any rent, Landlord is
authorized to collect any rents due or accruing from any assignee,
subtenant or other occupant of the demised premises and to apply the net
amounts collected to the fixed annual rent and additional rent reserved
herein. The receipt by Landlord of any amounts from an assignee or
subtenant, or other occupant of any part of the demised premises shall not
be deemed or construed as releasing Tenant from Tenant's obligations
hereunder or the acceptance of that party as a direct tenant."
(d) The Twelfth Article of the Lease is hereby supplemented with the
following:
"(c) Notwithstanding anything to the contrary, Landlord shall have the
right and privilege to serve at any time up to six (6) months prior to the
expiration of the term of this Lease, a notice upon Tenant that any
'nonstandard alterations' shall be removed and, in the event of service of
such notice, Tenant will, at Tenant's cost and expense, remove the same in
accordance with such request and repair any damage to the demised premises
caused by such removal; provided that Landlord shall have advised Tenant at
the time it consented to any such nonstandard alteration that Landlord may
require its removal at the end of the Lease term, if and to the extent that
Tenant shall have requested in writing such advice from Landlord when it
requested Landlord's consent to such alteration. For the purposes of this
Article 12, a 'nonstandard alteration' shall mean auditoriums or similar
type special use areas, vaults, atriums, kitchen equipment and
installations, internal stairways, slab reinforcements, raised floors or
other alterations which impede the installation of duct work or other
normal installations above the finished ceiling or which are not suitable
for normal office occupancy or which would be unusually difficult or costly
to remove in comparison to usual alterations required for general office
purposes. Notwithstanding the foregoing, it is understood and agreed by the
parties hereto that all improvements and other alterations to the demised
premises made by or on behalf of Tenant prior to July 1, 2000, shall be
deemed to be standard alterations which Landlord may not require Tenant to
remove."
-12-
(e) The Twenty-Second Article of the Lease is hereby deleted and the
following is substituted therefor:
"(i) Tenant agrees that Landlord shall furnish electricity to
Tenant on a 'submetering' basis. Landlord shall install any submeters
reasonably required in Landlord's judgment in the demised premises for the
purposes of this Article, at Tenant's sole cost and expense. Electricity
and electric service, as used herein, shall mean any element affecting the
generation, transmission, and/or distribution or redistribution of
electricity, including, but not limited to, services which facilitate the
distribution of service.
(ii) Tenant covenants and agrees to purchase electricity from
Landlord or Landlord's designated agent at charges, terms and rates,
including, without limitation, fuel adjustments and taxes, equal to those
specified in the Con Edison SC#4-I rate schedule effective on the date
Landlord first provides electricity to the demised premises on a
submetering basis (the "effective" date), or any successor rate schedule or
service classification, plus five percent (5%) for transmission line loss
and other redistribution costs. Where more than one (1) meter measures the
service of Tenant in the Building, then the service registered by each
meter shall be aggregated and billed at the applicable rate as if there
were only one (1) sub-meter measuring Tenant's aggregate use in the entire
demised premises. Bills therefore shall be rendered at such times as
Landlord may elect and the amount, as computed from a meter, shall be
deemed to be, and be paid as, Additional Charges. If any tax is imposed by
any Federal, State or Municipal authority upon Landlord's receipts from the
sale or resale of electrical energy to Tenant hereunder, Tenant covenants
and agrees that where permitted by law, Tenant's pro-rata share of such
taxes shall be included in the amount of Additional Charges to be paid by
Tenant to Landlord hereunder.
(iii) If all or part of the submetering additional rent payable
in accordance with this Article 22 becomes uncollectible or reduced or
refunded by virtue of any law, order or regulation, the parties agree that,
at Landlord's option, in lieu of submetering Additional Charges, and in
consideration of Tenant's use of the Building's electrical distribution
system and receipt of redistributed electricity and payment by Landlord of
consultant's fees and other redistribution costs, the fixed annual rent to
be paid under this Lease shall be increased by an "alternative charge"
which shall be the
-13-
average per rentable square foot rate payable by Tenant for electricity
during the prior twelve (12) month period pursuant to this Article.
(iv) Landlord shall not be liable 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. Tenant covenants and agrees that at all
times its use of electric current shall never exceed the capacity of
existing feeders to the Building or wiring installation. Any riser or
risers to supply Tenant's electrical requirements, upon written request of
Tenant, will be installed by Landlord, at the sole cost and expense of
Tenant, if, in Landlord's reasonable judgment, the same are reasonably
necessary and will not cause permanent damage or injury to the Building or
demised premises or cause or create a dangerous or hazardous condition or
entail excessive or unreasonable alterations, repairs or expenses or
otherwise interfere with or disturb other tenants or occupants of the
Building, except to a de minimis extent. In addition to the installation of
such riser or risers, Landlord will also at the sole cost and expense of
Tenant, install all other equipment proper and necessary in connection
therewith subject to the aforesaid terms and conditions. The parties
acknowledge that they understand that it is anticipated that electric
rates, charges, etc., may be changed by virtue of time-of-day rates or
other methods of billing, electricity purchases and the redistribution
thereof, and that the references in the foregoing paragraphs to changes in
methods of or rules on billing are intended to include any such changes.
Anything hereinabove to the contrary notwithstanding, in no event is the
submetering additional rent or any "alternative charge", to be less than an
amount equal to the total of Landlord's payment to public utilities and/or
other providers for the electricity consumed by Tenant (and any taxes
thereon or on redistribution of same) plus five percent (5%) for
transmission line loss and other redistribution costs. Landlord reserves
the right to terminate the furnishing of electricity upon sixty (60) days'
prior written notice to Tenant; provided Landlord terminates the furnishing
of electricity to at least fifty percent (50%) of the tenants of the
Building (not including those retail tenants on the ground floor of the
Building) to whom Landlord is furnishing electricity on a submetered basis,
in which event the Tenant may make application directly to the public
utility and/or other providers for the Tenant's entire separate supply of
electric current and Landlord shall permit its wires and conduits, to the
extent available and safely capable, to be used for such purpose, but only
to the extent of Tenant's then
-14-
authorized load. Any meters, risers, or other equipment or connections
reasonably necessary to furnish electricity on a submetering basis or to
enable Tenant to obtain electric current directly from such utility and/or
other providers shall be installed at Tenant's sole cost and expense. Only
rigid conduit or electrical metal tubing (EMT) will be allowed. Landlord,
upon the expiration of the aforesaid sixty (60) days' prior written notice
period may discontinue furnishing the electric current but this Lease shall
otherwise remain in full force and effect.
(v) Tenant's use of electric energy in the demised premises shall
not at any time exceed the capacity of any of the electrical conductors and
equipment in or otherwise serving the demised premises. In order to insure
that such capacity is not exceeded and to avert possible adverse effect
upon the Building's distribution of electricity via the Building's electric
system, Tenant shall not, without Landlord's prior consent in each instance
(which consent shall not be unreasonably withheld or delayed), connect any
fixtures, appliances or equipment (other than normal business machines and
personal computers, which do not materially increase Tenant's electrical
consumption) to the Building's electric system or make any alterations or
additions to the electric system of the demised premises existing on the
Extended Term Commencement Date. Landlord shall continue to make electrical
energy available to the demised premises in accordance with current
practice.
(vi) (1) Upon Tenant's request therefor, Landlord shall provide
Tenant with utility invoices and other reasonable documentation supporting
its computation of Additional Charges hereunder.
(2) At Landlord's option, Tenant shall purchase from
Landlord or Landlord's agent all lighting tubes, lamps, bulbs and ballasts
used in the demised premises and Tenant shall pay Landlord's reasonable
charges for providing and installing same, on demand, as additional rent."
(f) Tenant shall simultaneously upon execution of the First Amendment
of Lease dated as of July 1, 2000 (the "Amendment") deliver to Landlord
additional cash security in the amount of Thirty Thousand, Thirty and 83/100
Dollars ($30,030.83). With Tenant's delivery of this additional cash security,
the amount of security provided for in the Thirty-Eighth Article of the
-15-
Lease is hereby amended to be the aggregate amount of Fifty-Six Thousand Five
Hundred Ninety and 83/100 Dollars ($56,590.83).
(g) The Thirty-Ninth Article of the Lease is hereby amended as
follows:
(i) All references to "five (5) days" in subparagraph (a) thereof
are hereby deleted and "fifteen (15) days" is substituted therefor.
(ii) Subparagraph (b) thereof is hereby amended by deleting
proviso (1) therefrom and substituting the following therefor:
"(1) if Tenant shall make default in the payment of the rent
reserved herein for a period of five (5) days after receipt of
written notice from Landlord that same is past due or default in
the payment of additional rent due herein for a period of fifteen
(15) days after receipt of written notice from Landlord that same
is past due..."
(h) The Forty-Eighth Article of the Lease is hereby amended such that
notices sent by Tenant to Landlord shall be sent as set forth in the Lease to
c/o Newmark & Company Real Estate, Inc., 125 Park Avenue, New York, New York
10017. A copy of any default or any other notices shall be sent to Arent Fox
Kintner Plotkin & Kahn, PLLC, 1675 Broadway, New York, New York 10019,
Attention: Jill Hayman, Esq. The Forty-Eighth Article of the Lease is hereby
further amended such that a copy of notices sent by Landlord to Tenant shall
also be sent to Fulbright & Jaworski L.L.P., 666 Fifth Avenue, New York, New
York 10103, Attention: Douglas J. Danzig, Esq.
(i) The Fifty-Seventh Article of the Lease is hereby deleted.
(j) The term "base tax year" as set forth in the Fifty-Eighth Article
of the Lease is hereby amended to mean "the New York City real estate tax year
commencing July 1, 2000 and ending June 30, 2001".
(k) The Sixty-Fifth Article of the Lease is hereby deleted and the
following is substituted therefor:
"SIXTY-FIFTH: - Within fifteen (15) days after the Amendment has been fully
executed, Landlord shall pay Tenant, as a contribution to the cost of
Tenant's work to prepare the demised premises for Tenant's occupancy, the
amount of One Hundred Six Thousand Two Hundred Forty and 00/100
($106,240.00) Dollars. On February 1, 2006,
-16-
Landlord shall pay Tenant, as a second (2nd) contribution to the cost of
Tenant's work to prepare the demised premises for Tenant's occupancy, the
amount of Three Hundred Eighteen Thousand Seven Hundred Twenty and 00/100
($318,720.00) Dollars."
(I) The Sixty-Sixth Article of the Lease is hereby deleted and the
following is substituted thereof:
"SIXTY-SIXTH: - (i) If Tenant shall fail to pay any installment of fixed
annual rent for more than five (5) days after the same becomes due and
payable or any amount of additional rent for more than fifteen (15) days
after the same becomes due and payable (collectively, the "Default
Periods"), Tenant shall pay Landlord a late charge of ten cents ($0.10) for
each dollar of such fixed annual rent or additional rent as shall not have
been paid to Landlord within said respective Default Periods. Such late
charge shall be without prejudice to any of Landlord's rights and remedies
hereunder or at law for nonpayment of rent, shall be in addition thereto
and shall be deemed to be additional rent. Notwithstanding anything to the
contrary contained herein, Tenant shall be permitted to pay an installment
of fixed annual rent late once per calendar year without incurring a late
charge, provided such payment is received no later than the tenth (10th)
day of the month in which such payment is due. Further, notwithstanding
anything to the contrary contained herein, Landlord shall waive the late
charge for one (1) late payment of additional rent by Tenant per calendar
year, provided such payment is received no later than thirty (30) days
after the date such payment was due.
(ii) If in accordance with the Thirty-Ninth Article of the Lease, Tenant
shall be in default in the payment of (A) any installment of fixed annual
rent or any amount of additional rent or (B) any other sum of money which
shall become due and payable by Tenant to Landlord pursuant to the terms of
this Lease or by reason of Tenant's occupancy of the demised premises, in
addition to (and not in lieu of) the late charge provided for in
subparagraph (i) above, Tenant shall pay interest thereon at a rate equal
to the lesser of four percent (4%) above the prime rate per annum from time
to time set forth in The Wall Street Journal, calculated on the basis of
the actual days elapsed, based on a 360-day year, or the minimum rate of
interest allowed by applicable law(s), if any, then prevailing, from the
date on which such installment or payment is due to the date of payment
thereof, and such interest shall be deemed to be additional rent.
-17-
(iii) Except as required by statute and under the laws, nothing contained
in Article 39 or in this Article 66 shall be deemed to require Landlord to
give the notices therein or herein (if any) provided for prior to the
commencement of a summary proceeding for nonpayment of rent or a plenary
action for the recovery of rent on account of any default in the payment of
the same, it being intended that such notices are for the sole purpose of
creating a conditional limitation hereunder pursuant to which this Lease
shall terminate and if Tenant thereafter remains in possession or
occupancy, it shall become a holdover tenant."
(m) The Sixty-Seventh Article of the Lease is hereby deleted and the
following is substituted therefor:
"SIXTY-SEVENTH: - (i) This Lease shall be governed in all respects by the
laws of the State of New York.
(ii) If, in connection with obtaining financing for the Building, a bank,
insurance company or other lending institution shall request reasonable
modifications to this Lease as a condition to such financing, Tenant will
not unreasonably withhold, delay or defer its consent thereto, provided
that such modifications do not increase the obligations of Tenant
hereunder, decrease the obligations of Landlord hereunder, except to a de
minimis extent, or otherwise materially or adversely affect Tenant's
leasehold interest hereby created.
(iii) Tenant shall not be entitled to exercise any right of termination or
other option granted to it by this Lease (if any) at any time when Tenant
is in monetary default, after applicable notice, grace and/or cure periods,
in the performance or observance of any of the covenants, terms, provisions
or conditions on its part to be performed or observed under this Lease.
(iv) Tenant shall not occupy any space in the Building (by assignment,
sublease or otherwise) other than the demised premises or other premises
leased to Tenant directly by Landlord (except if the named Tenant herein is
subsequently purchased by a third party which leases space in the
Building), except with the prior written consent of Landlord in each
instance..
(v) Tenant acknowledges that it has no rights to any development rights,
"air rights" or comparable rights appurtenant to the land or building, and
consents, without further consideration, to any utilization
-18-
of such rights by Landlord and agrees to promptly execute and deliver any
instruments which may be requested by Landlord, including instruments which
may be reasonably requested by Landlord, including instruments merging
zoning lots, evidencing acknowledgment and consent. The provisions of this
paragraph shall be deemed to be and shall be construed as an express waiver
by Tenant of any interest Tenant may have as a "party in interest" (as such
quoted term is defined in Section 12 Zoning Lot of the Zoning Resolution of
the City of New York) in the building or the land.
(vi) Any and all payments and charges to be paid by Tenant hereunder other
than the annual rent payable pursuant to this Lease shall be additional
rent hereunder for non-payment of which Landlord shall have all of the
remedies provided herein or at law.
(vii) If this Lease be a renewal of an existing lease between the parties
or their predecessors in interest, then any obligation of Tenant for the
payment of rent or additional rent or the performance of any obligation
under such existing lease which accrues prior to the expiration thereof
shall constitute an obligation under this Lease, except as modified by the
Amendment (as that term is defined in Article 38 of this Lease), for
non-payment or non-performance for which Landlord shall have all of the
remedies provided herein."
(n) The Sixty-Eighth Article of the Lease is hereby deleted and the
following is substituted therefor:
"SIXTY-EIGHTH: - As a material inducement to Landlord for entering into
this Lease, Tenant covenants and agrees that except for the inside surfaces
of all walls, windows and doors bounding the demised premises, all of the
remainder of the Building is exclusively reserved to Landlord, subject to
Tenant's right to use the common areas of the Building in accordance with
the applicable provisions of this Lease (including, without limitation, the
lobby, elevators and core bathrooms, as opposed to private bathrooms, on
the thirty-fourth (34th) and thirty-fifth (35th) floors of the Building).
Notwithstanding anything to the contrary contained herein, Tenant shall
have the right to use in accordance with the Lease, the electric and
telephone closets and so-called "slop" sinks on the thirty-fourth (34th)
and thirty-fifth (35th) floors of the Building."
(o) The Sixty-Ninth Article of the Lease is hereby deleted.
-19-
(p) The second sentence of the Twenty-First Article of the Lease shall
be amended to read as follows:
"Landlord or Landlord's agents shall have the right to enter the demised
premises at reasonable times after notice (which may be oral) to Tenant to
examine the same..."
4. Each party hereto covenants, warrants and represents to the other party
that it has had no dealings, conversations or negotiations with any broker other
than Newmark & Company Real Estate, Inc., concerning the execution and delivery
of this Amendment. Each party hereto agrees to defend, indemnify and hold
harmless the other party against and from any claims for any brokerage
commissions and all costs, expenses and liabilities in connection therewith,
including, without limitation, reasonable attorneys' fees and disbursements,
arising out of its respective representations and warranties contained in this
Paragraph 4 being untrue. Landlord shall pay any brokerage fees which may be due
to Newmark & Company Real Estate, Inc. in connection with this Amendment
pursuant to a separate agreement.
5. Except as expressly set forth in this Amendment, the terms and
conditions of the Lease shall continue in full force and effect without any
change or modification and shall apply for the balance of the term of the Lease
as hereby extended. In the event of a conflict between the terms of the Lease
and the terms of this Amendment, the terms of this Amendment shall govern.
6. This Amendment shall not be altered, amended, changed, waived,
terminated or otherwise modified in any respect or particular, and no consent or
approval required pursuant to this Amendment shall be effective, unless the same
shall be in writing and signed by or on behalf of the party to be charged.
7. This Amendment shall be binding upon and shall inure to the benefit of
the parties hereto and to their respective heirs, executors, administrators,
successors and permitted assigns.
8. All prior statements, understandings, representations and agreements
between the parties, oral or written, are superseded by and merged in this
Amendment, which alone fully and completely expresses the agreement between them
in connection with this transaction and which is entered into after full
investigation, neither party relying upon any statement, understanding,
representation or agreement made by the other not embodied in this Amendment
relating to the demised premises. Landlord acknowledges that Tenant occupies
-20-
other space in the Building pursuant to separate agreements between Landlord and
Tenant which may be renewed and amended from time to time.
9. No failure or delay of either party in the exercise of any right or
remedy given to such party hereunder or the waiver by any party of any condition
hereunder for its benefit (unless the time specified herein for exercise of such
right or remedy has expired) shall constitute a waiver of any other or further
right or remedy nor shall any single or partial exercise of any right or remedy
preclude other or further exercise thereof or any other right or remedy. No
waiver by either party of any breach hereunder or failure or refusal by the
other party to comply with its obligations shall be deemed a waiver of any other
or subsequent breach, failure or refusal to so comply.
10. This Amendment shall be interpreted and enforced in accordance with the
laws of the state in which the demised premises are located without reference to
principles of conflicts of laws.
11. If any provision of this Amendment shall be unenforceable or invalid,
the same shall not affect the remaining provisions of this Amendment and to this
end the provisions of this Amendment are intended to be and shall be severable.
Notwithstanding the foregoing sentence, if (i) any provision of this Amendment
is finally determined by a court of competent jurisdiction to be unenforceable
or invalid in whole or in part, (ii) the opportunity for all appeals of such
determination have expired, and (iii) such unenforceability or invalidity alters
the substance of this Amendment (taken as a whole) so as to deny either party,
in a material way, the realization of the intended benefit of its bargain, such
party may terminate this Amendment within thirty (30) days after the final
determination by notice to the other. If such party so elects to terminate this
Amendment, then this Amendment shall be terminated and neither party shall have
any further rights, obligations or liabilities hereunder, except those
obligations which expressly survive the termination of this Amendment.
12. LANDLORD AND TENANT HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY,
UNCONDITIONALLY AND IRREVOCABLY WAIVE ANY RIGHT EACH MAY HAVE TO TRIAL BY JURY
IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER ARISING IN TORT OR CONTRACT)
BROUGHT BY EITHER AGAINST THE OTHER ON ANY MATTER ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS AMENDMENT OR ANY OTHER DOCUMENT EXECUTED AND DELIVERED BY
EITHER PARTY IN CONNECTION HEREWITH (INCLUDING ANY ACTION TO RESCIND OR CANCEL
THIS AMENDMENT ON THE GROUNDS THAT THIS AMENDMENT WAS FRAUDULENTLY INDUCED OR IS
OTHERWISE VOID OR VOIDABLE).
-21-
13. This Amendment may be executed in any number of counterparts. It is not
necessary that all parties sign all or any one of the counterparts, but each
party must sign at least one counterpart for this Amendment to be effective.
14. This Amendment shall not be binding upon either party unless and until
it is fully executed and delivered to both parties.
* * * * *
[The remainder of this page is left intentionally blank; the signature page
follows]
-22-
IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of
the date and year first above written.
LANDLORD:
500-512 SEVENTH AVENUE LIMITED PARTNERSHIP
By: 500-512 ArCap LLC, its General Partner
By: Archon Capital, L.P., its sole
Member
By: WH MezzCo GP, L.L.C., its
General Partner
By: /s/ Alan S. Kava
-----------------------------
Name: Alan S. Kava
Title: Vice President
By: GS MezzCo GP, L.L.C., its General
Partner
By:
-----------------------------
Name:
Title:
TENANT:
G-III LEATHER FASHIONS, INC.
By: WAYNE S. MILLER
-----------------------------------------
Name: WAYNE S. MILLER
Title: CFO
-23-
Agreement of Lease, made as of this 31st day of
January, 1994 between 500/512 SEVENTH AVENUE ASSOCIATES,
a partnership having offices in care of Helmsley-Spear,
Inc., 500/512 SEVENTH AVENUE party of the first part,
hereinafter referred to as "Landlord" or "Lessor", and
G-III LEATHER FASHIONS, INC. a domestic corporation
having offices at New York City, party of the second
part, hereinafter referred to as "Tenant" or "Lessee".
Witnesseth: Landlord hereby leases to Tenant and
Tenant hereby hires from Landlord the space on the floor,
as more particularly shown on the plan annexed hereto and
made a part hereof, in the building known as 512 Seventh
Avenue 33rd Floor in the Borough of Manhattan. City of
New York, for the term of 9 Years (or until such term
shall sooner cease and expire as hereinafter provided) to
commence on the 1st day of February 1994, and to end on
the 31st day of January, 2003, both dates inclusive, at
an annual rent of $159,360.00 which Tenant agrees to pay
in lawful money of the United States which shall be legal
tender in payment of all debts and dues, public and
private, at the time of payment, in equal monthly
installments of $13,280.00 in advance on the first day of
each month during said term, at the office of Landlord or
such other place as Landlord may designate, without any
set off or deduction whatsoever, except that Tenant shall
pay the first monthly installment(s) on the execution
hereof (unless this lease be a renewal).
The parties hereto, for themselves, their heirs,
distributees, executors, administrators, legal
representatives, successors and assigns, hereby covenant
and agree as follows:
FIRST:--Tenant shall pay the rent and additional RENT
rent as above and as hereinafter provided.
SECOND:--(a) Tenant shall pay to Landlord, as ADDITIONAL RENT
additional rent hereunder, in advance, on the first day
of each and every month during the term hereof, all sums
expended by Landlord and/or which become due to Landlord
under this lease and under any collateral agreements
relating to the premises. Tenant's use and occupancy
thereof, the supplying by Landlord to Tenant of any
services in connection therewith, together with any fines
or penalties imposed or assessed by any governmental
authority by reason of Tenant's failure to comply with
its requirements.
(b) If Tenant shall default in the observance or
performance of any term or covenant on Tenant's part to
be observed or performed under or by virtue of any of the
terms or provisions in any paragraph of this lease,
Landlord may immediately or at any time thereafter and
without notice perform the same for the account of
Tenant, and if Landlord makes any expenditures or incurs
any obligations for the payment of money in connection
therewith including, but not limited to, attorneys' fees
in instituting, prosecuting or defending any action or
proceeding, such sums paid or obligations incurred with
interest and costs shall be deemed to be additional rent
hereunder.
(c) The receipt by Landlord at any time of any
installment of the regular stipulated rent hereunder or
of any additional rent shall not be deemed to be a waiver
of any other additional rent then due. For the non-
payment of any additional rent, Landlord shall have all
the rights and remedies which it would have in the case
of a default in the payment of the regular stipulated
rent hereunder or any installment thereof.
THIRD: -- In the event that, at the commencement of RENT DUE UNDER OTHER
the term of this lease, or thereafter. Tenant shall be in LEASE AS ADDITIONAL
default in the payment of rent to Landlord pursuant to RENT
the terms of another lease with Landlord or with
Landlord's predecessor in interest. Landlord may, at
Landlord's option and without notice to Tenant, add the
amount of such arrearages to any monthly installment of
rent payable hereunder, and the same shall be payable to
Landlord as additional rent.
FOURTH:--Tenant shall use and occupy the demised USE
premises for Showroom office for sale at wholesale
and not retail of womens apparel.
and for no other purpose. Tenant shall not suffer or
permit the demised premises or any part thereof to be
used by others for any purpose whatsoever, without the
prior written consent of Landlord in each instance.
REQUIREMENTS OF LAW FIFTH:-- Tenant at its sole expense shall comply
with all laws, orders and regulations of Federal, State,
County and Municipal Authorities, and with any direction
of any public officer or officers, pursuant to law,
which shall impose any violation, order or duty upon
Landlord or Tenant with respect to demised premises, or
the use or occupation thereof. *Tenant shall not do, or
permit to be done, any act or thing upon said premises
which shall or might subject Landlord to any liability or
responsibility for injury to any person or persons or to
property by reason of any business or operation being
carried on upon said premises or for any other reason.
CERTIFICATE OF SIXTH:-- Tenant will not at any time use or occupy
OCCUPANCY the demised premises in violation of the certificate of
occupancy or certificate of compliance issued for the
building of which the demised premises form a part, and
in the event that any department of the City or State of
New York shall hereafter at any time contend and/or
declare by notice, violation, order or in any other
manner whatsoever that the premises hereby demised are
used for a purpose which is a violation of such
certificate of occupancy. Tenant shall, upon five (5)
days' written notice from Landlord, immediately
discontinue said use of such premises. Failure by Tenant
to discontinue such use after such notice shall be
considered a default in the fulfillment of a covenant of
this lease, and Landlord shall have the right to
terminate this lease immediately, and in addition thereto
shall have the right to exercise any and all rights and
privileges and remedies given to Landlord by and pursuant
to the provisions of Paragraph 40 hereof. The statement
in this lease of the nature of the business to be
conducted by Tenant in demised premises shall not be
deemed or construed to constitute a representation or
guaranty by Landlord that such business may continue to
be conducted in the premises for the entire period of the
lease or is lawful or permissible under the certificate
of occupancy in effect for the building of which the
demised premises form a part, or otherwise permitted by
law. If alterations or additions, including but not
limited to a sprinkler system, are needed to permit
lawful conduct of Tenant's business or to comply with the
certificate of occupancy, the same shall be made by and
at the sole expense of Tenant.
NON-HAZARDOUS USES SEVENTH:-- Tenant shall not suffer any act to be
done or any condition to exist on the demised premises or
any part thereof or any article to brought thereon, which
may be dangerous, unless safeguarded as required by law,
or by any insurance carrier having any interest in such
conduct or condition or which may, in law, constitute a
nuisance, public or private, and as not to make void or
voidable any insurance applicable to the building, under
penalty of damages and forfeiture.
SAFETY PRECAUTIONS EIGHTH:-- Tenant shall not at any time allow smoking
on any part of the premises where stock is stored. Tenant
shall store all silk and other textiles in steel bins or
shelving, the bottoms of which shall be at least six
inches above the floor, and the tops of which shall
extend at least three inches and shall have drip points
so as to shed water from the goods. No shelving bins
shall be installed without Landlord's prior written
consent. Tenant shall make all floors water-tight by
painting or covering them with linoleum or other
water-tight floor covering. Where cleaning fluid is used,
it shall be non-inflammable. Tenant shall use no cleaning
fluid not approved in writing by Landlord. Tenant will
not permit the accumulation of waste or refuse matter on
the premises.
TENANT TO KEEP NINTH: --Tenant will conduct its business in such a
INSURANCE RATE LOW manner as to enable Landlord or other tenants in the
building to obtain the lowest possible insurance rate
upon the entire building in which the demised premises
are located, and will, at its sole expense, comply with
all rules, orders, regulations or requirements of all
public liability, fire and insurance policies in force at
any time with respect to the demised premises, as well as
all rules, orders, regulations or requirements of the New
York Board of Fire Underwriters or any other similar
body, and shall not do or permit anything to be done in
or upon said premises or bring or keep anything therein,
except as now or hereafter permitted by the Fire
Department. Board of Fire Underwriters, Fire Insurance
Rating Organization, or other authority having
jurisdiction and then only in such quantity and manner of
storage as not to increase the rate for fire insurance
applicable to the building, or use the premises in a
manner which shall increase the rate of fire insurance on
the building of which demised premises form a part, or on
property located therein, over that in effect prior to
this lease. If by reason of failure of Tenant to comply
with the provisions of this paragraph including, but not
limited to, the mere use to which Tenant puts the
premises, the fire insurance rate shall at the beginning
of this lease or at any time therafter be higher than it
otherwise would be, then Tenant shall reimburse Landlord,
as additional rent hereunder, for that part of all fire
insurance premiums thereafter paid by Landlord, which
shall have been charged because of such failure or use by
Tenant, and shall make such reimbursement upon the first
day of the month following such outlay by Landlord. In
any action or proceeding wherein Landlord and Tenant are
parties, a schedule or "make up" of rate for the building
or demised premises issued by the New York Fire Insurance
Exchange, or other body making fire insurance rates for
said premises, shall be conclusive evidence of the facts
therein stated and of the several items and charges in
the fire insurance rate then applicable to said premises.
Tenant shall not bring or
*Specifically excluding, however, existing wiolations of
law which are the responsibility of Landlord.
2
permit to be brought or kept in or on the demised
premises, any inflammable, combustible or explosive
fluid, chemical, substance or material other than silk or
other textiles, or cause or permit any odors of cooking
or other processes, or any unusual or other objectionable
odors to permeate from the demised premises. That the
premises are being used for the purpose set forth herein
shall not relieve Tenant from the foregoing duties,
obligation and expenses.
TENTH:--(a) Tenant shall not assign, mortgage or ASSIGNMENT, MORTGAGE
encumber this agreement nor underlet the demised premises AND SUBLEASING
or any part thereof or permit the demised premises or any
part thereof to be occupied by anybody other than Tenant,
without the prior written consent of Landlord in each
instance. The transfer of a majority of the issued and
outstanding capital stock of any corporate Lessee of this
lease or a majority of the total interest in any
partnership Lessee, however accomplished, and whether in
a single transaction or in a series of related or
unrelated transactions, shall be deemed an assignment of
this lease. If this lease be assigned, or if the, demised
premises or any part thereof be underlet or occupied by
anybody other than Tenant. Landlord may, after default by
Tenant, collect rent from the assignee, under-tenant or
occupant, and apply the net amount collected to the rent
herein reserved, but no such assignment, underletting,
occupancy or collection shall be deemed a waiver of this
covenant, or the acceptance of the assignee, under-tenant
or occupant as tenant, or a release of Tenant from the
further performance by Tenant of covenants on the part of
Tenant herein contained. The consent by Landlord to an
assignment or underletting shall not in any wise be
construed to relieve Tenant from obtaining the express
consent in writing of Landlord to any further assignment
or underletting.
(b) If the demised premises shall be underlet in
whole or in part by Tenant or its heirs, executors,
administrators, legal representatives, successors or
assigns, such party shall, within three (3) days of such
underletting, furnish Landlord with a duplicate original
of such underlease and shall, on demand of Landlord,
supply Landlord within three (3) days of such demand, a
written list of all such under-tenants, the terms,
including expiration dates of their under-tenancies, the
rents payable thereunder, and any additional information
requested by Landlord. This provision or compliance
therewith, however, shall in no event be construed to be
a consent to any underletting or a waiver of the covenant
against underletting contained herein. Non-compliance by
Tenant with the provisions of this paragraph shall be
deemed to be a breach of this lease.
(c) Tenant assumes and shall be responsible for and
liable to Landlord, for all acts and omissions on the
part of any present or future under-tenant, their agents,
employees, servants or licensees, and any breach or
violation of any of the terms, covenants, agreements,
provisions, conditions and limitations of this lease,
whether by act or omission, by any under-tenant shall
constitute a breach or violation of this lease by Tenant.
ELEVENTH:-- Throughout the term of this lease, WASTE
Tenant will take good care of the demised premises and
appurtenances and suffer no waste, damage, disfigurement
or injury thereto or any part thereof.
TWELFTH:-- (a) Tenant shall make no alterations, ALTERATIONS
decorations, installations, additions or improvements in
or to the demised premises, including, but not limited
to, an air-conditioning or cooling system, unit or part
therof or other apparatus of like or other nature, nor
bring materials in connection therewith on the demised
premises, without Landlord's prior written consent, and
then only by contractors or mechanics approved by
Landlord, and subject to plans and specifications
approved by Landlord. All such work, alterations,
decorations, installations, additions or improvements
shall be done at Tenant's sole expense and at such times
and in such manner as Landlord may from time to time
designate. All alterations, decorations, installations,
additions or improvements upon demised premises, made by
either party, including all paneling, decorations,
partitions, railings, mezzanine floors, galleries, steam,
water, and air conditioning systems and units, shelving,
electric fixtures and the like, shall, unless Landlord
elects otherwise (which election shall be made by giving
a notice pursuant to the provisions hereof not less than
thirty (30) days prior to the expiration or other
termination of this lease or any renewal or extension
thereof) become the property of Landlord, and shall
remain upon, and be surrendered with, said premises, as a
part thereof, at the end of the term or renewal term, as
the case may be. In the event Landlord shall elect
otherwise, then such alterations, installations,
additions or improvements made by Tenant upon the demised
premises as the Landlord shall select, shall be removed
by Tenant at Tenant's sole cost and expense. All
alterations, decorations, installations, additions or
improvements installed by Tenant may be used by Tenant
without additional charge for such use, and without any
right in the Landlord to remove the same in the absence
of any default under this lease during the term hereof.
(b) Tenant, at its own expense, will promptly repair
all damage and injury resulting from such removal and
restore the space theretofore occupied by such fixtures
and installations to good order and condition and to
character and appearance equal to that of the area
adjacent thereto, in default of any of which Landlord may
at its option cause the same to be done at Tenant's
expense.
3
REPAIRS THIRTEENTH: -- Tenant shall take good care of the
demised premises and the fixtures and appurtenances
therein, and at its sole cost and expense make all
repairs thereto as and when needed to preserve them in
good working order and condition. All damage or injury to
the demised premises and to its fixtures, appurtenances
and equipment or to the building of which the same form a
part or to its fixtures, appurtenances and equipment
caused by Tenant's moving property in or out of the
building or by installation or removal of furniture,
fixtures or other property, or resulting from fire,
explosion, air-conditioning unit or system, short
circuits, flow or leakage of water, steam, illuminating
gas, sewer gas, sewerage or odors or by frost or by
bursting or leaking of pipes or plumbing works or gas, or
from any other cause of any other kind or nature
whatsoever due to carelessness, omission, neglect,
improper conduct or other cause of Tenant, its servants,
employees, agents, visitors or licensees shall be
repaired, restored or replaced promptly by Tenant at its
sole cost and expense to the satisfaction of Landlord.
All aforesaid repairs, restorations and replacements
shall be in quality and class equal to the original work
or installations. If Tenant fails to make such repairs,
restorations or replacements within a reasonable time
same may be made by Landlord at expense of Tenant and
collectible as additional rent.
LANDLORD'S FOURTEENTH:--(a) Except where otherwise provided in
LIABILITY, this lease, there shall be no allowance to Tenant for a
ALTERATIONS diminution of rental value and no liability on the part
OR REPAIRS of Landlord by reason of inconvenience, annoyance or
injury to business arising from Landlord. Tenant or
others making any repairs, alterations, additions or
improvements in or to any portion of the building or
demised premises, or in or to fixtures, appurtenances, or
equipment thereof, and no liability upon Landlord for
failure of Landlord or others to make any repairs,
alterations, additions or improvements in or to any
portion of the building or of demised premises, or in or
to the fixtures, appurtenances or equipment thereof.
(b) Landlord reserves the right to stop service of
the electric, water, sprinkler, steam, air conditioning,
elevator, heating and plumbing systems, when necessary,
by reason of accident, or emergency, or for repairs,
alterations, replacements or improvements, in the
judgment of Landlord desirable or necessary to be made,
until said repairs, alterations, replacements or
improvements shall have been completed.
EMPLOYMENT OF FIFTEENTH:-- Tenant agrees that whenever any
UNION LABOR TO MAKE alterations, additions, improvements, changes or repairs
ALTERATIONS AND to the said premises are consented to by Landlord, or in
REPAIRS the moving of merchandise, fixtures or equipment into the
said building, or moving the same therefrom, only such
labor under agreement with the Building Trades Employers'
Association of New York City, or which shall not cause
strikes or concerted labor action by other employees of
the building, and which have the same or similar labor
union affiliations as those employed by Landlord or
Landlord's contractors, shall be employed.
DISCHARGE OF SIXTEENTH:--(a) Any mechanic's lien filed against
LIENS, ETC. the demised premises, or the building of which the same
form a part, for work claimed to have been done for, or
materials claimed to have been furnished to Tenant, shall
be discharged by Tenant within ten (10) days thereafter,
by payment in full or at Tenant's expense, by filing the
bond required by law. If Tenant fails to so pay or file
any bond, Landlord may pay the amount of said lien or
discharge the same by deposit, or otherwise, billing
Tenant for all expenses in connection therewith as
additional rent.
(b) Nothing in this lease contained shall be deemed
or construed in any way as constituting the consent or
request of Landlord, express or implied by inference or
otherwise, to any contractor, sub-contractor, laborer or
materialman for the performance of any labor or the
furnishing of any materials for any specific improvement,
alteration to, or repair of the demised premises, or any
part thereof, or for the demolition or replacement of the
demised premises or any part thereof.
(c) Tenant agrees to obtain and deliver to Landlord,
written and unconditional waivers of liens (and agreement
that its filed plans may be replaced), for all plans,
specifications and drawings for work or materials to be
furnished to Tenant at the premises, signed by all
architects, engineers and designers to become involved in
such work for Tenant; with respect to contractors,
subcontractors, materialman and laborers, and all work or
materials to be furnished to Tenant at the premises.
Tenant agrees to obtain and deliver to Landlord written
and unconditional waiver of mechanics liens upon the
premises or the building after payments to the
contractors, and subject to any applicable provisions of
the Lien Law.
SIGNS SEVENTEENTH: -- Tenant will not, without Landlord's
written consent, place, affix or paint any signs,
awnings, projections or advertising material of any kind
upon the exterior of the premises or of the building, not
upon the windows, nor in any location that may be visible
from any of the lobbies or passageways. If Tenant shall
cause or permit any sign or other object, similar or
dissimilar, to be placed on or affixed to any
4
part of the building not inside the space specifically
demised hereunder. Landlord shall have the right, without
notice or liability to Tenant, to remove and dispose of
the same and to make any repairs necessitated by such
removal, all at Tenant's sole expense and risk.
Landlord's expense in so doing shall be deemed
additional rent hereunder and collectible as such.
EIGHTEENTH:--(a) Tenant will not cause or permit any MISCELLANEOUS
connection to be made to the wiring on the electrical PROHIBITED ACTIONS
panel boards of the building without the prior written OF TENANT
consent and supervision of Landlord.
(b) Tenant agrees that it will not drive nails in,
drill in, disfigure or deface any part of the building
nor suffer the same to be done, nor cause or permit the
floors, walls, doors or ceilings of the demised premises
to be drilled, hammered, pounded or otherwise dealt with
in a noisy or disturbing manner at any time during
customary business hours (i.e.. between 9:00 A.M. and
5:00 P.M.) whether or not such activities are incidental
to or part of work to which Landlord has consented.
(c) Tenant shall not install any pressing equipment,
whether connected to Tenant's gas-fired boiler or to the
building steam system, without first having plans and
specifications approved by Landlord.
The vacuum used by pressing machines for the drying
of garments shall be created by an electrically driven
vacuum pump. Tenant shall not use any vacuum created by
the use of steam from a gas-fired boiler of from the
building steam system.
(d) Tenant shall not permit any connection to be
made at the demised premises with any high pressure steam
lines, electric current lines or water lines without
Landlord's prior written consent.
(e) Tenant shall not make any electrical or plumbing
installation without Landlord's prior written consent.
All water lines must be installed in red brass.
(f) Window air-conditioning units shall in no event
be installed without Landlords' prior written approval or
be mounted so as to extend outward beyond the line of the
window frame.
(g) Tenant shall install no linoleum, rubber, mastic
or vinyl tile floor covering, unless it is laid over a
layer of felt, double cemented in the manner approved by
Landlord.
(h) Tenant shall not place a load upon any floor of
the demised premises exceeding the floor load per square
foot area which such floor was designed to carry and
which is allowed by law. Landlord reserves the right to
prescribe the weight and position of all safes which must
be placed so as to distribute the weight. Business
machines and mechanical equipment shall be placed and
maintained by Tenant at Tenant's expense in settings
sufficient in Landlord's judgment to absorb and prevent
vibration, noise and annoyance. Tenant agrees that upon
the written request of Landlord. Tenant will, within
fifteen (15) days of the mailing of such request, provide
rubber or other approved settings for absorbing,
preventing and decreasing noise and/or vibration from any
or all machines or machinery, such insulation or other
devices for the prevention, decrease or elimination of
noise satisfactory to Landlord shall be made in such
manner and of such material as Landlord may direct. In
the event that Tenant fails to comply with the aforesaid
request within the fifteen (15) days aforementioned.
Landlord may, at its option, by notice in writing to
Tenant, cause the term of this lease to expire. Landlord
in such event shall have the right to re-enter the
premises by summary proceedings or otherwise without
liability. Landlord shall not give less than thirty (30)
days' notice of its election to terminate the lease as
above provided. Landlord shall have the right to enter
the demised premises with workmen and materials and to
insulate the machinery as above provided, collecting from
Tenant the cost of such work as additional rent in the
event that Tenant fails to comply with the written
request aforementioned after the expiration of fifteen
(15) days from the receipt thereof.
(i) Tenant shall not move any safe, heavy machinery,
heavy equipment, freight, bulky matter, or fixtures into
or out of the building without Landlord's prior written
consent and the filing with Landlord of a Rigger's
Liability, Insurance Certificate satisfactory of
Landlord. If such safe, machinery, equipment, freight,
bulky matter or fixtures require special handling. Tenant
agrees to employ only persons holding a Master Rigger's
License to do said work, and that all work in connection
therewith shall comply with the Administrative Code of
the City of New York.
(j) If the demised premises be or become infested
with vermin. Tenant shall, at Tenant's expense, cause the
same to be exterminated from time to time to the
satisfaction of Landlord, and shall employ such
exterminators and such exterminating company or companies
as shall be approved by Landlord.
5
(k) The water and wash closets and other plumbing
fixtures shall not be used for any purposes other than
those for which they were designed or constructed, and no
sweepings, rubbish, rags, acids or other substances shall
be deposited therein.
(i) Tenant agrees to provide proper receptacles as
called for by the Fire Department. Board of Fire
Underwriters. Fire Insurance Rating Organization or of
the authority having jurisdiction. Tenant hereby agrees
to cause its rubbish or waste to be disposed of at its
own cost and expense, subject to all the rules and
regulations that from time to time may be made in
connection therewith by Landlord, including a regulation
that Tenant shall use a single rubbish or waste remover
designated by Landlord for the removal of the rubbish or
waste of the tenants in the building. Tenant further
agrees that it shall not at any time store any of its
rubbish or waste in the lobbies, foyers, passage-ways or
other spaces adjacent to the premises herein demised, nor
shall Tenant place the rubbish (which is to be taken by
the waste remover) in the said areas prior to 5:00 P.M.
(m) If Tenant is a lessee of any store in said
building, the said Tenant hereby agrees to keep the
sidewalk, entrance and passage-ways unencumbered and
unobstructed, and agrees, further, to remove all ice and
snow from the sidewalks immediately in front of the
demised premises.
(n) Tenant will not suffer, permit or allow unusual
or objectionable odors to be produced upon or permeate
from the demised premises.
WINDOW NINETEENTH: --Tenant will not clean, nor require,
CLEANING permit, suffer or allow any window in the demised
premises to be cleaned, from the outside in violation of
Section 202 of the Labor Law or of the rules of the Board
of Standards and Appeals, or of any other board or body
having or asserting jurisdiction.
NOTICE OF TWENTIETH: --Tenant shall give prompt notice to
DAMAGE TO Landlord of any accidents to or defects in the pipes and
PIPES, OF FIRE apparatus in the building or of any fire that may occur.
LANDLORD'S TWENTY-FIRST:--Tenant shall permit Landlord to
ACCESS TO erect, use and maintain, pipes and conduits in and
PREMISES through the demised premises. Landlord or Landlord's
agents shall have the right to enter the demised premises
at reasonable times after notice to Tenant to examine the
same, and to show them to prospective purchasers or
lessees of the building, and to make such decorations,
repairs, alterations, improvements or additions as
Landlord may deem necessary or desirable, and Landlord
and its representatives shall be allowed to take and
store all material into and upon said premises that may
be required therefor without the same constituting an
eviction of Tenant in whole or in part and the rent
reserved shall in no wise abate while said decorations,
repairs, alterations, improvements, or additions are
being made, by reason of loss or interruption of business
of Tenant, or otherwise. During the six months prior to
the expiration of the term of this lease, or any renewal
term. Landlord may exhibit the premises to prospective
tenants or purchasers, and place upon said premises, or
the exterior thereof, the usual notice "To Let" or "For
Sale", which notices Tenant shall permit to remain
thereon without molestation. If during the last month
of the term. Tenant shall have removed all or
substantially all of Tenant's property therefrom.
Landlord may immediately enter and alter, renovate and
redecorate the demised premises, without elimination or
abatement of rent, or incurring liability to Tenant for
any compensation, and such acts shall have no effect upon
this lease. If Tenant shall not be personally present to
open and permit an entry into said premises, at any time,
when for any reason an entry therein shall be necessary
or permissible. Landlord or Landlord's agents may enter
the same by a master key, or may forcibly enter the same,
without rendering Landlord or such agents liable therefor
(if during such entry Landlord or Landlord's agents shall
accord reasonable care to Tenant's property), and without
in any manner affecting the obligations and covenants of
this lease.** Nothing herein contained, however, shall be
deemed or construed to impose upon Landlord any
obligation, responsibility or liability whatsoever, for
the care, supervision or repair, of the building or any
part thereof, other than as herein provided. Landlord
shall also have the right at any time, without the same
constituting an actual or constructive eviction and
without incurring any liability to Tenant therefor, to
change the arrangement and/or location of entrances or
passageways, doors and doorways, and corridors,
elevators, stairs, toilets, or other public parts of the
building and to change the name, number or designation by
which the building is commonly known.
ELECTRICITY TWENTY-SECOND: -- Lessee agrees that Lessor may
furnish electricity to Lessee on a "submetering" basis or
on a "rent inclusion" basis.
(a) Submetering: If and so long as Lessor provides
electricity to the demised premises on a submetering
basis. Lessee covenants and agrees to purchase the same
from Lessor or Lessor's designated agent at charges,
terms and rates set, from time to lime, during the term
of this lease by Lessor but not more than those specified
**Landlord shall endeavor to minimize interference
with Tenant's business.
6
in the service classification in effect on January 1,
1970 pursuant to which Lessor then purchased electric
current from the public utility corporation serving the
part of the city where the building is located; provided,
however, said charges shall be increased in the same
percentage as any percentage increase in the billing to
Lessor for electricity for the entire building, by reason
of increase in Lessor's electric rates or service
classifications, subsequent to January 1, 1970, and so as
to reflect any increase in Lessor's electric charges,
fuel adjustment, or by taxes or charges of any kind
imposed on Lessor's electricity purchases, or for any
other such reason, subsequent to said date. Any such
percentage increase in Lessor's billing for electricity
due to changes in rates or service classifications shall
be computed by the application of the average consumption
(energy and demand) of electricity for the entire
building for the twelve (12) full months immediately
prior to the rate and/or service classification change,
or any changed methods of or rules on billing for same,
on a consistent basis to the new rate and/or service
classification and to the service classification in
effect on January 1, 1970. If the average consumption of
electricity for the entire building for said prior twelve
(12) months cannot reasonably be applied and used with
respect to changed methods of or rules on billing, then
the percentage increase shall be computed by the use of
the average consumption (energy and demand) for the
entire building for the first three (3) months after such
change, projected to a full twelve (12) months; and that
same consumption, so projected, shall be applied to the
service classification in effect on January 1, 1970.
Where more than one meter measures the service of Lessee
in the building, the service rendered through each meter
may be computed and billed separately in accordance with
the rates herein. Bills therefore shall be rendered at
such times as Lessor may elect and the amount, as
computed from a meter, shall be deemed to be, and be paid
as, additional rent. In the event that such bills are not
paid within five (5) days after the same are rendered.
Lessor may, without further notice, discontinue the
service of electric current to the demised premises
without releasing Lessee from any liability under this
lease and without Lessor or Lessor's agent incurring any
liability for any damage or loss sustained by Lessee by
such discontinuance of service. If any tax is imposed
upon Lessor's receipt from the sale or resale of
electrical energy or gas or telephone service to Lessee
by any Federal, State or Municipal Authority, Lessee
covenants and agrees that, where permitted by law,
Lessee's pro-rata share of such taxes shall be passed on
to, and included in the bill of, and paid by, Lessee to
Lessor.
(b) Rent Inclusion: If and so long as Lessor provides
electricity to the demised premises on a rent inclusion
basis, Lessee agrees that the fixed annual rent shall be
increased by the amount of the Electricity Rent Inclusion
Factor ("ERIF"), as hereinafter defined. Lessee
acknowledges and agrees (i) that the fixed annual rent
hereinabove set forth in this lease does not yet, but is
to include an ERIF of $2.95 per rentable square foot to
compensate Lessor for electrical wiring and other
installations necessary for, and for its obtaining and
making available to Lessee the redistribution of,
electric current as an additional service; and (ii) that
said ERIF, which shall be subject to periodic adjustments
as hereinafter provided, has been partially based upon an
estimate of the Lessee's connected electrical load, which
shall be deemed to be the demand (KW), and hours of use
thereof, which shall be deemed to be the energy (KWH) for
ordinary lighting and light office equipment and the
operation of the usual small business machines, including
Xerox or other copying machines (such lighting and
equipment are hereinafter called "Ordinary Equipment")
during ordinary business hours ("ordinary business hours"
shall be deemed to mean 50 hours per week), with Lessor
providing an average connected load of 4 1/2 watts of
electricity for all purposes per rentable square foot.
Any installation and use of equipment other than Ordinary
Equipment and/or any connected load and/or any energy
usage by Lessee in excess of the foregoing shall result
in adjustment of the ERIF as hereinafter provided. For
purposes of this Article the rentable square foot area of
the presently demised premises shall be deemed to be
10,624 square feet.
If the cost to Lessor of electricity shall have been, or
shall be, increased or decreased subsequent to May 1,
1993 (whether such change occurs prior to or during the
term of this lease), by change in Lessor's electric rates
or service classifications, or by any increase,
subsequent to the last such electric rate or service
classification change, in fuel adjustments or charges of
any kind, or by taxes, imposed on Lessor's electricity
purchases, or for any other such reason, then the ERIF,
which is a portion of the fixed annual rent, shall be
changed in the same percentage as any such change in cost
due to changes in electric rates or service
classifications, and, also, Lessee's payment obligation,
for electricity redistribution, shall change from time to
time so as to reflect any such increase in fuel
adjustments or charges, and taxes. Any such percentage
increases in Lessor's cost due to changes in electric
rates or service classifications shall be computed by the
application of the average consumption (energy and
demand) of electricity for the entire building for the
twelve (12) full months immediately prior to the rate
and/or service classification change, other change in
cost, or any changed methods of or rules on billing for
same, on a consistent basis to the new rate and/or
service classification and to the immediately prior
existing
7
rate and/or service classifications. If the average
consumption of electricity for the entire building for
said prior twelve (12) months cannot reasonably be
applied and used with respect to changed methods of or
rules on billing, then the percentage increase shall be
computed by the use of the average consumption (energy
and demand) for the entire building for the first three
(3) months after such change, projected to a full twelve
(12) months, so as to reflect the different seasons; and
the same consumption, so projected, shall be applied to
the rate and/or service classification which existed
immediately prior to the change.
The parties agree that a reputable, independent
electrical consultant, selected by Lessor ("Lessor's
electrical consultant"), shall determine the percentage
change for the changes in the ERIF due to Lessor's
changed costs, and that Lessor's electrical consultant
may from time to time make surveys in the demised
premises of the electrical equipment and fixtures and the
use of current. (i) If any such survey shall reflect an
average connected load in the demised premises in excess
of 4 1/2 watts of electricity for all purposes per
rentable square foot and/or energy usage in excess of
ordinary business hours (each such excess is hereinafter
called "excess electricity") then the connected load
and/or the hours of use portion(s) of the then existing
ERIF shall each be increased by an amount which is equal
to a fraction of the then existing ERIF, the numerator of
which is the excess electricity (i.e. excess connected
load and/or excess usage) and the denominator of which is
the average connected load and/or the usage thereof which
was the basis for the computation of the then existing
ERIF. Such fractions shall be determined by Lessor's
electrical consultant. The fixed annual rent shall then
be appropriately adjusted, effective as of the date of
any such change in connected load and/or usage, as
disclosed by said survey. (ii) If such survey shall
disclose installation and use of other than Ordinary
Equipment, then effective as of the date of said survey,
there shall be added to the ERIF portion of the fixed
annual rent (computed and fixed as hereinabove described)
an additional amount equal to what would be paid under
the SC-4 Rate I Service Classification in effect on May
1, 1993 (and not the time-of-day rate schedule) for such
load and usage of electricity, with the connected load
deemed to be the demand (KW) and the hours of use thereof
deemed to be the energy (KWH), as hereinbefore provided,
(which addition to the ERIF shall be increased or
decreased by all electricity cost changes of Lessor, as
hereinabove provided, from May 1, 1993 through the date
of billing).
In no event, whether because of surveys or for any other
reason, is the originally specified $2.95 per rentable
square fool ERIF portion of the fixed annual rent (plus
any net increase thereof, but not decrease, by virtue of
all electric rate or service classification changes
subsequent to May 1, 1993) to be reduced.
(c) General Conditions: The determinations by Lessor's
electrical consultant shall be binding and conclusive on
Lessor and on Lessee from and after the delivery of
copies of such determinations to Lessor and Lessee,
unless, within fifteen (15) days after delivery thereof,
Lessee disputes such determination. If Lessee so disputes
the determination, it shall at its own expense, obtain
from a reputable, independent electrical consultant its
own determinations in accordance with the provisions of
this Article. Lessee's consultant and Lessor's consultant
then shall seek to agree. If they cannot agree within
thirty (30) days they shall choose a third reputable
electrical consultant, whose cost shall be shared equally
by the parties, to make similar determinations which
shall be controlling. (If they cannot agree on such third
consultant within (10) days, then either party may apply
to the Supreme Court in the County of New York for such
appointment.) However, pending such controlling
determinations, Lessee shall pay to Lessor the amount of
additional rent or ERIF in accordance with the
determinations of Lessor's electrical consultant. If the
controlling determinations differ from Lessor's
electrical consultant, then the parties shall promptly
make adjustment for any deficiency owed by Lessor or
overage paid by Lessee.
At the option of Lessor, Lessee agrees to purchase from
Lessor or its agents all lamps and bulbs used in the
demised premises and to pay for the cost of installation
thereof. Lessor shall not be liable to Lessor for any
loss or damage or expense which Lessee may sustain or
incur if either the quantity or character of electric
service is changed or is no longer available or suitable
for Lessee's requirements. Lessee covenants and agrees
that at all times its use of electric current shall never
exceed the capacity of existing feeders to the building
or the risers or wiring installation. Lessee agrees not
to connect any additional electrical equipment to the
building electric distribution system, other than lamps,
typewriters and other small office machines which consume
comparable amounts of electricity, without Lessor's prior
written consent, which consent shall not be unreasonably
withheld. Any riser or risers to supply Lessee's
electrical requirements, upon written request of Lessee,
will be installed by Lessor, at the sole cost and expense
of Lessee, if, in Lessor's sole judgment, the same are
necessary and will not cause permanent damage or injury
to the building or demised premises or cause or create a
dangerous or
8
hazardous condition or entail excessive or unreasonable
alterations, repairs or expense or interfere with or
disturb other tenants or occupants. In addition to the
installation of such riser or risers, Lessor will also at
the sole cost and expense of Lessee, install all other
equipment proper and necessary in connection therewith
subject to the aforesaid terms and conditions. The
parties acknowledge that they understand that it is
anticipated that electric rates, charges, etc., may be
changed by virtue of time-of-day rates or other methods
of billing, and that the references in the foregoing two
paragraphs to changes in methods of or rules on billing
are intended to include any such changes. Supplementing
Article 53 hereof, if all or part of the submetering
additional rent or the ERIF payable in accordance with
Subdivision (A) or (B) of this Article becomes
uncollectible or reduced or refunded by virtue of any
law, order or regulation, the parties agree that, at
Lessor's option, in lieu of submetering additional rent
or ERIF, and in consideration of Lessee's use of the
building's electrical distribution system and receipt of
redistributed electricity and payment by Lessor of
consultants' fees and other redistribution costs, the
fixed annual rental rate(s) to be paid under this Lease
shall be increased by an "alternative charge" which shall
be a sum equal to $2.95 per year per rentable sq. ft. of
the demised premises, changed in the same percentage as
any changes in the cost to Lessor for electricity for the
entire building subsequent to May 1, 1993, because of
electric rate or service classification changes, as in
Subdivision (B) hereof provided, and such percentage
change to be computed as in Subdivision (B) provided. The
Lessor reserves the right, at any time upon thirty (30)
days' written notice, to change its furnishing of
electricity to Lessee from a rent inclusion basis to a
submetering basis, or vice versa. The Lessor reserves the
right to terminate the furnishing of electricity on a
rent inclusion, submetering, or any other basis at any
time, upon thirty (30) days' written notice to the
Lessee, in which event the Lessee may make application
directly to the public utility for the Lessee's entire
separate supply of electric current and Lessor shall
permit its wires and conduits, to the extent available
and safely capable, to be used for such purpose. Any
meters, risers or other equipment or connections
necessary to furnish electricity on a submetering basis
or to enable Lessee to obtain electric current directly
from such utility shall be installed at Lessee's sole
cost and expense. Only rigid conduit or electricity metal
tubing (EMT) will be allowed. The Lessor, upon the
expiration of the aforesaid thirty (30) days' written
notice to the Lessee may discontinue furnishing the
electric current but this lease shall otherwise remain in
full force and effect. If Lessee was provided electricity
on a rent inclusion basis when it was so discontinued,
then commencing when Lessee receives such direct service
and as long as Lessee shall continue to receive such
service, the fixed annual rental rate payable under this
lease shall be reduced by the amount of the ERIF which
was payable immediately prior to such discontinuance of
electricity on a rent inclusion basis.
TWENTY-THIRD:-(a) If Landlord installs a water meter to
measure Tenant's water consumption for all purposes,
Tenant shall pay Landlord for the cost of the meter and
the cost of the installation thereof and throughout the
duration of Tenant's occupancy Tenant shall keep said
meter and installation equipment in good working order
and repair at Tenant's own cost and expense, in default
of which Landlord may cause such meter and equipment to
be replaced or repaired and collect the cost thereof from
Tenant. Tenant agrees to pay for water consumed, as shown
on said meter as and when bills are rendered, and on
default in making such payment Landlord may pay such
charges and collect the same from Tenant. Landlord may
inspect such water meter at any time and shall have
access thereto at all times for the purpose of such
inspection.
(b) In addition to the foregoing, Tenant agrees to pay
its proportionate share of the water consumed in the
toilets and other portions of the premises over which
Landlord may reserve control, irrespective of the fact
that the same shall be located outside of the demised
premises.
(c) Tenant covenants and agrees to pay its pro-rata share
of the sewer rent, charge or any other tax, rent levy or
charge which now or hereafter is assessed, imposed or a
lien upon the demised premises or the realty of which
they are part pursuant to law, order or regulation made
or issued in connection with the use, consumption,
maintenance or supply of water, water system or sewage or
sewage connection or system.
(d) The bill rendered by Landlord for metered water,
sewer or any other charges provided for in this paragraph
"23," shall be based upon Tenant's consumption and shall
be payable by Tenant as additional rent. Any such costs
or expenses incurred or payments made by Landlord for any
of the reasons or purposes hereinabove stated, shall be
deemed to be additional rent payable by Tenant and
collectible by Landlord as such. If the building or the
demised premises or any part thereof be supplied with
water through a meter through which water is also
supplied to other premises. Tenant shall pay to Landlord
as additional rent, on the first day of each month,
$128.00 as Tenant's portion. Independently of and in
addition to any of the remedies reserved
9
to Landlord hereinabove or elsewhere in this lease.
Landlord may sue for and collect any monies to be paid by
Tenant or paid by Landlord for any of the reasons or
purposes hereinabove set forth.
TWENTY-FOURTH:- If the sprinkler system or any of
its appliances shall be damaged or injured or not in
proper working order by reason of any act or omission of
Tenant, Tenant's agents, servants, employees, licensees
or visitors. Tenant shall forthwith restore the same in
good working condition at its own expense: and if the New
York Board of Fire Underwriters or the New York Fire
Insurance Rating Organization or any bureau, department
or official of the State or City Government, require or
recommend that any changes, modifications, alterations or
additional sprinkler heads or other equipment be made or
supplied by reason of Tenant's business, or the location
of partitions, trade fixtures, or other contents of the
demised premises, or for any other reason, or if any such
changes, modifications, alterations, additional sprinkler
heads or other equipment, become necessary to prevent the
imposition of a penalty or charge against the full
allowance for a sprinkler system in the fire insurance
rate as fixed by said Rating Organization, or by any Fire
Insurance Company, Tenant shall, at Tenant's expense,
promptly make and supply such changes, modifications,
alterations, additional sprinkler heads or other
equipment. Tenant shall pay to Landlord as additional
rent the sum of $ 128.00 on the first day of each
month during the term of this lease, as Tenant's portion
of the contract price for sprinkler supervisory service.
TWENTY-FIFTH:- Tenant shall have the privilege of
using the air conditioning system which affects the whole
or a portion of the demised premises, and shall, at its
own cost and expense, maintain and operate said system in
compliance with all present and future laws and
governmental requirements, and shall obtain all
governmental licenses and permits now or hereafter
required. Tenant shall pay for all electric current,
water and refrigerants used in connection with said
system. Tenant, at its own cost and expense, shall make
or cause to be made, all repairs, alterations, changes,
additions or improvements in and to said system which may
be necessary or which may be required or recommended by
Landlord or by any governmental authority, and shall
furnish all parts and supplies necessary or desirable in
connection therewith, but no alterations, changes,
additions or improvements shall be made by Tenant without
the advance written consent of Landlord. Landlord's
charges for electric current, water and refrigerants and
for such parts, supplies, repairs, alterations, changes,
additions or improvements as are caused to be furnished
or made by Landlord shall be payable by Tenant as
additional rent upon presentation of Landlord's bill for
same. The non-functioning or defective functioning of
said air conditioning system, or Tenant's inability to
operate or maintain the same in compliance with lawful
requirements, or any delay, discomfort or inconvenience
suffered by Tenant in connection therewith, or, without
limitation of or by the foregoing, any other matter or
thing related to such system, shall not give rise to any
obligation or liability on the part of Landlord and shall
not affect this lease or be deemed to release or
discharge Tenant of any of Tenant's obligations or
liabilities under this lease or otherwise. Title to said
system and all present and future parts thereof is and
shall be vested in Landlord.
TWENTY-SIXTH:- (a) As long as Tenant is not in
default under any of the covenants of this lease.
Landlord shall provide necessary elevator facilities on
business days from 8:00 A.M. to 6:00 P.M., and on
Saturdays from 8:00 A.M. to 1:00 P.M. On Sundays,
holidays and nights, Landlord will furnish at least one
(1) elevator.
(b) If the building of which the demised premises
are a part supplies manually operated elevator service.
Landlord may proceed with alterations necessary to
substitute automatic control elevator service upon ten
(10) days' written notice to Tenant without in any way
affecting the obligations of Tenant hereunder, provided
that the same shall be done with the minimum amount of
inconvenience to Tenant, and Landlord pursues with due
diligence the completion of the alterations. Where
automatic control elevator service is now, or hereafter
furnished and the demised premises contain an entire
floor or floors. Tenant will provide, at its own cost and
expense, locks for all entrances to such floor or floors
from the elevators.
(c) Tenant agrees it will not permit its employees
other than office help to use the passenger elevator in
said building, nor will it permit them to use the stairs
leading to and from the passenger entrance to said
10
building. Landlord may prescribe and regulate which
elevator and entrance shall be used by Tenant's employees
and for Tenant's shipping.
TWENTY-SEVENTH:- Landlord will:
(a) Furnish heat to the demised premises, when and HEAT, CLEANING,
as required by law, on business days during regular PUBLIC AREAS
business hours.
(b) Cause to be kept clean the public halls and
public portions of the building, which are used in common
by all tenants.
TWENTY-EIGHTH:-- It is expressly agreed that if in REQUIRED
consequence of the use of the demised premises for ALTERATIONS.
manufacturing purposes any Municipal or State Authority MACHINERY
requires alterations and additions to such premises or
the building of which they are a part. Landlord, in
addition to other remedies provided for in this lease,
shall have the option of terminating this lease on sixty
(60) days' written notice to Tenant. Upon expiration of
said sixty (60) days, the term of this lease shall
terminate, and Tenant shall immediately vacate the
premises. In such event, Landlord shall refund to Tenant
the unearned pro rata portion of any rent paid in
advance. Landlord reserves the privilege of complying
with any order, rule or regulation as aforementioned in
order to remove such violation, if any. In such event,
Tenant waives any and all claims for damages growing out
of the work in the building or on the premises in
connection therewith. In the event that the violation can
be removed by Tenant's limiting the number of employees
in the demised premises. Tenant shall so limit the number
of employees immediately and no claim for damages or any
loss may be made against Landlord therefor.
TWENTY-NINTH:-- Tenant shall have the use of the FIXTURES &
partitions existing in the premises demised herein and of PARTITIONS INSTALLED
all other equipment, fixtures and appurtenances installed BY LANDLORD
by Landlord prior to or during the term hereof. The
ownership of all such property shall at all times be
vested in Landlord and possession thereof shall revert to
Landlord upon the expiration of the lease.
THIRTIETH:-- If any vault space is adjacent to the VAULTS
demised premises, the same shall not be or be deemed to
be part of the demised premises or its appurtenances.
Landlord may permit Tenant to use such vault space
gratuitously, but such permission may be revoked by
Landlord at any time on two (2) days' notice. Landlord
shall have the right at any time to cause a wall to be
erected for the purpose of sealing off such vault space
from the demised premises. Said wall may be erected
wholly or partly on that portion of the demised premises
which abuts such vault space. Landlord and its designees
shall have the right from time to time to enter and
remain upon the demised premises, with men and materials,
for the purpose of erecting such wall. Tenant shall not
be entitled to any compensation, abatement of rent, or
other claim by reason of any action taken under this
paragraph by or on behalf of Landlord. Any fee or license
charge or tax of municipal authorities for such vault
shall be paid by Tenant.
THIRTY-FIRST:-- Landlord or its agents shall not be LIABILITY OF
liable for any damage to property of Tenant or of others LANDLORD,
entrusted to employees of the building, nor for the loss PROPERTY
of or damage to any property of Tenant by theft or LOSS,
otherwise. Landlord or its agents shall not be liable for DAMAGE
any injury or damage to persons or property resulting
from fire, explosion, falling ceilings, falling plaster,
steam, gas, electricity, water, rain or snow or leaks
from any part of said building or from the pipes,
appliances or plumbing works or from the roof, street or
subsurface or from any other place or by dampness or by
any other cause of whatsoever nature, including but not
limited to the making of repairs and improvements, unless
caused by or due to the negligence of Landlord, its
agents, servants or employees: nor shall Landlord or its
agents be liable for any such damage caused by other
tenants or persons in said building or caused by
operations in construction of any private, public or
quasi public work; nor shall Landlord be liable for any
latent defect in the demised premises or in the building
of which they form a part. Tenant shall give immediate
notice to Landlord in case of fire or accidents in the
demised premises or in the building or of defects therein
or in any fixtures or equipment.
THIRTY-SECOND:-- Tenant shall, throughout the term INDEMNITY
and thereafter, indemnify Landlord and save it harmless
and free from damages, liabilities, penalties, losses,
expenses, causes of action, claims, suits and judgments,
as well as all expenses and attorneys' fees, arising from
injury during said term to the premises of any nature,
and also for any matter or thing growing out of the
occupation of the demised premises or the streets,
sidewalks, or vaults adjacent thereto occasioned in whole
or part by any act or acts, omission or omissions of
Tenant, its employees, guests, agents, assigns or
undertenants.
THIRTY-THIRD:-- Neither this lease nor any LIABILITY OF
obligation hereunder on Tenant's part to be performed LANDLORD, SERVICE
(including, but not limited to. Tenant's obligation to INTERRUPTION ACTS
pay the rents provided for hereunder) shall in any wise BEYOND CONTROL
be
11
released, discharged, impaired, excused or otherwise
affected because of Landlord's inability to supply,
furnish or make such services, fixtures, equipment,
repairs, additions, improvements, alterations and/or
decorations, if any, as Landlord may be required to
supply, furnish or make hereunder or in connection
herewith, or because of any delay in supplying,
furnishing or making any of the foregoing, if such
inability or delay directly or indirectly results from or
is caused by or attributable to any cause or thing
whatsoever beyond Landlord's control, including, but not
limited to, any law or ordinance or any governmental
order, rule, regulation or requirement, or any shortages
in supplies, materials or labor, or any acts of God, or
any labor difficulties, disasters or acts of public
enemies, and in any such event Landlord shall be relieved
of any liability to Tenant which it might otherwise have
had by reason of any such requirement. Lessee agrees to
look solely to Lessor's estate and interest in the land
and building, or the lease of the building or of the land
and building, and the demised premises, for the
satisfaction of any right or remedy of Lessee for the
collection of a judgment (or other judicial process)
requiring the payment of money by Lessor, in the event of
any liability by Lessor, and no other property or assets
of Lessor shall be subject to levy, execution or other
enforcement procedure for the satisfaction of Lessee's
remedies under or with respect to this lease, the
relationship of landlord and tenant hereunder, or
Lessee's use and occupancy of the demised premises or any
other liability of Lessor to Lessee (except for
negligence).
SUBORDINATION THIRTY-FOURTH:-- This lease is and shall be subject
and subordinate at all times to all present or future
leases and subleases of the entire building or of the
land and entire building of which the demised premises
form a part, and to all mortgages which now affect or may
hereafter affect or be made in respect of such leases and
subleases or the real property of which the demised
premises form a part (whether or not such leases or
mortgages also affect any other or additional real
property), and to all renewals, modifications,
consolidations, replacements and extensions thereof, and
to all advances made or hereafter to be made upon the
security thereof. This clause shall be self-operative and
no further instrument in writing to effectuate such
subordination shall be necessary. In confirmation of such
subordination, however. Tenant shall, on demand, promptly
execute, acknowledge and deliver such further instruments
or certificates that Landlord may request. Tenant hereby
irrevocably appoints Landlord the attorney-in-fact of
Tenant to execute, acknowledge and deliver any such
instrument or certificate for or on behalf of Tenant. In
the event that any Master Lease or any other ground or
underlying lease is terminated, or any mortgage
foreclosed, this lease shall not terminate or be
terminable by Lessee unless Lessee was specifically named
in any termination or foreclosure judgment or final
order. In the event that the Master Lease or any other
ground or underlying lease is terminated as aforesaid.
Lessee agrees to enter into a new lease covering the
within premises, for the remaining term of this lease and
otherwise on the same terms, conditions and rentals as
herein provided, with and at the election of the holder
of any superior lease, or if there is no superior lease
in existence, then with and at the election of the holder
of the fee title to the premises. If the current term of
the Master Lease shall expire prior to the date set forth
herein for the expiration of this lease, then, unless
Lessor, at its sole option, shall have elected to extend
or renew the term of the Master Lease, the term of this
lease shall expire on the date of expiration of the
Master Lease, notwithstanding the later expiration date
hereinabove set forth. If the Master Lease is renewed,
then the term of this lease shall expire as hereinabove
set forth. From time to time. Lessee, on at least ten
(10) days' prior written request by Lessor, will deliver
to Lessor a statement in writing certifying that this
lease is unmodified and in full force and effect (or if
there shall have been modifications, that the same is in
full force and effect as modified and stating the
modifications) and the dates to which the rent and other
charges have been paid and stating whether or not the
Lessor is in default in performance of any covenant,
agreement or condition contained in this lease and, if
so, specifying each such default of which Lessee may have
knowledge. This paragraph shall not be deemed modified in
whole or in part by any provision of this lease or any
rider thereto during the term hereof, unless such
provisions or rider shall by its terms expressly so
modify it.
FIRE THIRTY-FIFTH: -- Provided the damage be not caused
by the fault or neglect of Tenant or of its employees,
agents, visitors or licensees, in the event of damage by
fire, or other action of the elements, to the demised
premises not rendering all of them unfit for occupancy.
Landlord shall repair the same with reasonable dispatch
after notice of such damage, and the rent accrued or
accruing shall not cease: but if the damage be so
extensive, as to render all of the demised premises
untenantable, the rent shall cease until they be
repaired, provided the damage be not caused by the
carelessness or negligence of Tenant or of the agents or
servants of Tenant. No penalty shall accrue for
reasonable delay which may arise by reason of adjustment
of insurance on the part of Landlord and/or Tenant, and
for reasonable delay on account of "labor troubles" or
any other cause beyond Landlord's control. If the demised
premises are totally damaged or are rendered wholly
untenantable by fire or other cause, and if Landlord
shall decide not to restore or not to rebuild the same,
or if the building shall be so damaged that Landlord
shall decide to demolish it or to rebuild it or if the
cost of restoration of the
12
building of which the demised premises are a part,
resulting from the aforesaid fire or other casualty shall
exceed the sum of $3.000.000, then or in any of such
events Landlord may, within ninety (90) days after such
fire or other cause, give Tenant a notice in writing of
termination which notice shall be given as provided in
this lease, and thereupon the term of this lease shall
expire by lapse of time upon the third day after such
notice is given, and Tenant shall vacate the demised
premises and surrender the same to Landlord. If Tenant
shall not be in default under this lease then, upon the
termination of this lease under the conditions provided
for in the sentence immediately preceding. Tenant's
liability for rent shall cease as of the day following
the casualty. Tenant hereby expressly waives the
provisions of Section 227 of the Real Property Law and
agrees that the foregoing provisions of this paragraph
shall govern and control in lieu thereof. If the damage
or destruction be due to the fault or neglect of Tenant,
the debris shall be removed by and at the expense of
Tenant.
THIRTY-SIXTH:--If the whole or any part of the CONDEMNATION
demised premises shall be acquired or condemned by
Eminent Domain for any public or quasi public use or
purpose, then and in that event, the term of this lease
shall cease and terminate from the date of title vesting
in such proceeding. If any part of the land or the
building of which the demised premises are a part shall
be so acquired or condemned, then and in that event the
term of this lease, at the option of Landlord, shall
cease and terminate on ten (10) days' notice by Landlord
to Tenant. In neither event shall Tenant have any claim
for the value of any unexpired term of said lease.
THIRTY-SEVENTH:--If, when and to the extent BANKRUPTCY
permitted by law, the parties agree that the following
provisions shall apply to this lease and tenancy (and
that the provisions of II U.S.C. Section 365(b) shall be
applied): (a) If at any time prior to the date herein
fixed as the commencement of the term of this lease there
shall be filed against Tenant thereof or if such filing
is made by Tenant in any court pursuant to any statute
either of the United States or of any State a petition in
bankruptcy or insolvency or for reorganization or for the
appointment of a receiver or trustee of all or a portion
of Tenant's property, and within thirty (30) days thereof
Tenant fails to secure a discharge thereof, or if Tenant
makes an assignment for the benefit of creditors, or
petition for or enter into an arrangement, this lease
shall ipso facto be cancelled and terminated, and in
which event, neither Tenant nor any person claiming
through or under Tenant or by virtue of any statute or of
an order of any court shall be entitled to possession of
the demised premises and Landlord, in addition to the
other rights and remedies given by (c) hereof and by
virtue of any other provision herein or elsewhere in this
lease contained or by virtue of any statute or rule of
law, may retain as liquidated damages any rent, security,
deposit or monies, received by him from Tenant or others
in behalf of Tenant upon the execution hereof.
(b) If at the date fixed as the commencement of the
term of this lease or if at any time during the term
hereby demised, there shall be filed against Tenant
thereof or if such filing is made by Tenant in any court
pursuant to any statute of the United States or any State
a petition of bankruptcy or insolvency or for
reorganization or for the appointment of a receiver or
trustee of all or a portion of Tenant's property, and
within thirty (30) days thereof Tenant fails to secure a
discharge thereof, or if Tenant makes an assignment for
the benefit of creditors or petition for or enter into an
arrangement, this lease, at the option of Landlord,
exercised within a reasonable time after notice of the
happening of any one or more of such events, may be
cancelled and terminated, and in which event neither
Tenant nor any person claiming through or under Tenant by
virtue of any statute or of an order of any court shall
be entitled to possession or to remain in possession of
the premises demised, but shall forthwith quit and
surrender the premises, and Landlord, in addition to the
other rights and remedies Landlord has by virtue of any
other provision herein or elsewhere in this lease
contained or by virtue of any statute or rule of law, may
retain as liquidated damages any rent, security, deposit
or monies received by him from Tenant or others in behalf
of Tenant.
(c) It is stipulated and agreed that in the event of
the termination of this lease pursuant to (a) or (b)
hereof. Landlord shall forthwith, notwithstanding any
other provisions of this lease to the contrary, be
entitled to recover from Tenant as and for liquidated
damages an amount equal to the difference between the
rent reserved hereunder for the unexpired portion of the
term demised and the then fair and reasonable rental
value of the demised premises for the same period. In the
computation of such damages, the difference between any
installment of rent becoming due hereunder after the date
of termination and the fair and reasonable rental value
of the demised premises for the period for which such
installment was payable shall be discounted to the date
of termination at the rate of four percent (4%) per
annum. If such premises or any pan thereof be re-let by
Landlord for the unexpired term of said lease, or any pan
thereof, before presentation of proof of such liquidated
damages to any court, commission or tribunal, the amount
of rent reserved upon such re-letting shall be prima
facie to be the fair and reasonable rental value for the
pan or the whole of the premises so re-let during the
term of the re-letting. Nothing herein contained shall
limit or prejudice the right of Landlord to prove for and
obtain as liquidated damages by reason of such
termination, an amount equal to the maximum
13
allowed by any statute or rule of law in effect at the
time when, and governing the proceedings in which, such
damages are to be proved, whether or not such amount be
greater, equal to, or less than the amount of the
difference referred to above.
SECURITY THIRTY-EIGHTH:--Tenant has deposited with Landlord
the sum of $ 13,536.00 as security for the faithful
performance and observance by Tenant of the terms,
provisions and conditions of this lease; it is agreed
that in the event Tenant defaults in respect of any of
the terms, provisions and conditions of this lease,
including, but not limited to, the payment of rent and
additional rent. Landlord may use, apply or retain the
whole or any part of the security so deposited to the
extent required for the payment of any rent and
additional rent or any other sum as to which Tenant is in
default or for any sum which Landlord may expend or may
be required to expend by reason of Tenant's default in
respect of any of the terms, covenants and conditions of
this lease, including but not limited to, any damages or
deficiency in the re-letting of the premises, whether
such damage or deficiency accrued before or after summary
proceedings or other re-entry by Landlord. Tenant shall,
upon demand, deposit with Landlord the full amount so
used, in order that Landlord shall have the full security
deposit on hand at all times. In the event that Tenant
shall fully and faithfully comply with all of the terms,
provisions, covenants and conditions of this lease, the
security shall be returned to Tenant after the date fixed
as the end of the lease and after delivery of entire
possession of the demised premises to Landlord. In the
event of any transfer or conveyance by Landlord of its
lease to the building of which the demised premises form
a pan. hereinafter referred to. Landlord shall have the
right to transfer the security to the transferee or
grantee, and Landlord shall thereupon be released by
Tenant from all liability for the return of such
security, and Tenant agrees to look to the new Landlord
solely for the return of said security; and it is agreed
that the provisions hereof shall apply to every transfer
or assignment made of the security to a new Landlord.
Tenant further covenants that it will not assign or
encumber or attempt to assign or encumber the monies
deposited herein as security and that neither Landlord
nor its successors or assigns shall be bound by any such
assignment, encumbrance, attempted assignment or
attempted encumbrance.
DEFAULT THIRTY-NINTH:--(a) If Tenant defaults in fulfilling
any of the covenants of this lease other than the
covenants for the payment of rent or additional rent, or
of any ancillary agreement, or if the demised premises
become vacant or deserted, then, in any one or more of
such events, upon Landlord serving a written five (5)
days' notice upon Tenant specifying the nature of said
default and upon the expiration of said five (5) days, if
Tenant shall have failed to comply with or remedy such
default, or if the said default or omission complained of
shall be of such a nature that the same cannot be
completely cured or remedied within said five (5) day
period, and if Tenant shall not have diligently commenced
curing such default within such five (5) day period, and
shall not thereafter with reasonable diligence and in
good faith proceed to remedy or cure such default, then
Landlord may serve a written three (3) days' notice of
cancellation of this lease upon Tenant, and upon the
expiration of said three (3) days, this lease and the
term thereunder shall end and expire as fully and
completely as if the date of expiration of such three (3)
day period were the day herein definitely fixed for the
end and expiration of this lease and the term thereof,
and Tenant shall then quit and surrender the demised
premises to Landlord, but Tenant shall remain liable as
hereinafter provided.
(b) If the notice provided for in (a) hereof shall
have been given, and the term shall expire as aforesaid;
or (1) if Tenant shall make default in the payment of the
rent reserved herein or any item of additional rent
herein mentioned or any part of either or in making any
other payment herein provided: (1) within 5 days after
notice or (2) if any execution or Attachment shall be
issued against Tenant or any of Tenant's property
whereupon the demised premises shall be taken or occupied
or attempted to be taken or occupied by someone other
than Tenant: or (3) if Tenant shall make default with
respect to any other lease between Landlord and Tenant:
or (4) if Tenant shall fail to move into or take
possession of the premises within fifteen (15) days after
commencement of the term of this lease, of which fact
Landlord shall be the sole judge: then and in any of such
events Landlord may without notice, re-enter the demised
premises either by force or otherwise, and dispossess
Tenant by summary proceedings or otherwise: and the legal
representative of Tenant or other occupant of demised
premises and remove their effects and hold the premises
as if this lease had not been made, and Tenant hereby
waives the service of notice of intention to re-enter or
to institute legal proceedings to that end. If Tenant
shall make default hereunder prior to the date fixed as
the commencement of any renewal or extension of this
lease. Landlord may cancel and terminate such renewal or
extension agreement by written notice.
(c) If Tenant is presently in possession of the
demised premises pursuant to a lease in writing
heretofore made and if, before the commencement of the
term herein provided the aforesaid lease shall be
terminated or Tenant shall be dispossessed or shall
voluntarily or involuntarily vacate, surrender or remove
from the
14
demised premises, then this lease shall, at the option of
Landlord, be terminated, but Tenant shall nevertheless
remain liable as hereinbefore provided.
FORTIETH:--In case of any such default, re-entry, REMEDIES OF LANDLORD
expiration and/or dispossess by summary proceedings or
otherwise, (a) the rent and additional rent shall become
due thereupon and be paid up to the time of such
re-entry, dispossess and/or expiration, together with
such expenses as Landlord may incur for legal expenses,
attorneys' fees, brokerage, and/or putting the demised
premises in good order, or for preparing the same for
re-rental; (b) Landlord may re-let the premises or any
pan or pans thereof, either in the name of Landlord or
otherwise, for a term or terms, which may at Landlord's
option be less than or exceed the period which would
otherwise have constituted the balance of the term of
this lease and may grant concessions or free rent; and/or
(c) Tenant or the legal representatives of Tenant shall
also pay Landlord as liquidated damages for the failure
of Tenant to observe and perform said Tenant's covenants
herein contained, any deficiency between the rent hereby
reserved and/or covenanted to be paid and the net amount,
if any, of the rents collected on account of the lease or
leases of the demised premises for each month of the
period which would otherwise have constituted the balance
of the term of this lease. The rent received from any
re-letting or re-lettings, but only for the unexpired
portion of this lease, shall be applied first to the
payment of Landlord's expenses in resuming, possession
and re-letting the premises, which expenses shall include
but not be limited to attorneys' fees, brokerage
commissions, cleaning, repairs, painting and decoration.
The balance, if any, shall be applied in payment of all
unpaid rent, additional rent and other charges due from
Tenant hereunder, irrespective of whether the liability
therefor arose prior or subsequent to the date of the
expiration of the term hereof. Tenant hereby covenants
and agrees to pay to Landlord, within a reasonable time
after demand therefor shall be made, the balance, if any,
remaining unpaid. In the event that any re-letting
hereunder results in Landlord's receiving from Tenant in
any month an amount in excess of the amount due for such
month, then and in that event Tenant shall not be
obligated to make any payment to Landlord for rent due in
such month, nor shall Landlord at any time be obligated
to make any refund or apply any credit to Tenant with
respect to such rent, and Tenant shall have no claim by
way of defense to a suit or otherwise that Landlord has
received for any prior month or that any new tenant has
agreed to pay for any subsequent month a greater amount
than that hereinabove reserved to be paid as rent for
that month. The failure or refusal of Landlord to re-let
the premises or any pan or pans thereof shall not release
or affect Tenant's liability for damages. Any security in
Landlord's possession not retained by it as liquidated
damages may be applied by it for any or all of the
aforesaid purposes. Any such liquidated damages shall be
paid as additional rent hereunder in monthly installments
by Tenant on the rent day specified in this lease and any
suit brought to collect the amount of the deficiency for
any month shall not prejudice in any way the rights of
Landlord to collect the deficiency for any subsequent
month by a similar proceeding. Landlord, at Landlord's
option, may make such alterations, repairs, replacements
and/or decorations in the demised premises as Landlord in
Landlord's sole judgment considers advisable and
necessary for the purpose of re-letting the demised
premises; and the making of such alterations and/or
decorations shall not operate or be construed to release
Tenant from liability hereunder as aforesaid. Landlord
shall in no event be liable in any way whatsoever for
failure to re-let the demised premises, or in the event
that the demised premises are re-let, for failure to
collect the rent thereof under such re-letting. In the
event of a breach or threatened breach by Tenant of any
of the covenants or provisions hereof. Landlord shall
have the right of injunction and the right to invoke any
remedy allowed at law or inequity as if re-entry, summary
proceedings and other remedies were not herein provided
for. Mention in this lease of any particular remedy,
shall not preclude Landlord from any other remedy, in law
or in equity.
FORTY-FIRST:--Notwithstanding anything elsewhere COURT ORDER RELATING
contained in this lease, if by reason of any present or TO RENT
future cause or thing whatsoever (including, without
limitation, by reason of any statute, ordinance,
judgment, decree, court order or governmental rule or
regulation). Tenant will not or shall not be required to
pay to Landlord the full amount of rent and additional
rent reserved hereunder, then Landlord, at its
unrestricted option, may give Tenant not less than five
(5) days' notice of intention to end this lease and the
term hereof, and thereupon, on the date specified in said
notice, this lease and the term hereof shall expire as
fully and completely as if that date were the date,
herein originally fixed for the expiration of this lease
and the term hereof.
FORTY-SECOND:--It is mutually agreed by and WAIVER OF TRIAL BY
between Landlord and Tenant that the respective parties JURY
hereto shall and they hereby do waive trial by jury in
any action, proceeding or counterclaim brought by either
of the parties hereto against the other on any matters
whatsoever arising out of or in any way connected with
this lease, the relationship of landlord and tenant.
Tenant's use or occupancy of said premises, except for
personal injury or property damage, or involving the
right to any statutory relief or remedy. Tenant will not
15
interpose any counterclaim of any nature in any summary
proceeding. The provisions of this paragraph shall be
binding upon the respective heirs, distributees,
executors, administrators, successors and assigns of the
parties hereto and all subtenants hereunder.
WAIVER OF FORTY-THIRD:--Tenant hereby expressly waives any and
REDEMPTION all rights of redemption granted by or under any present
or future laws in the event of Tenant being evicted or
dispossessed for any cause, or in the event of Landlord
obtaining possession of demised premises, by reason of
the violation by Tenant of any of the covenants and
conditions of this lease, or otherwise.
NO WAIVER FORTY-FOURTH:--(a) If there be any agreement between
Landlord and Tenant providing for the cancellation of
this lease upon certain provisions or contingencies,
and/or an agreement for the renewal hereof at the
expiration of the term first above mentioned, the right
to such renewal or the execution of a renewal agreement
between Landlord and Tenant prior to the expiration of
such first mentioned term shall not be considered an
extension thereof or a vested right in Tenant to such
further term, so as to prevent Landlord from cancelling
this lease and any such extension thereof during the
remainder of the original term hereby granted; such
privilege, if and when so exercised by Landlord, shall
cancel and terminate this lease and any such renewal or
extension previously entered into between said Landlord
and Tenant or the right of Tenant to any such renewal or
extension; any right herein contained on the part of
Landlord to cancel this lease shall continue during any
extension or renewal hereof; any option on the part of
Tenant herein contained for an extension or renewal
hereof shall not be deemed to give Tenant any option for
a further extension beyond the first renewal or extended
term.
(b) No act or thing done by Landlord or Landlord's
agents during the term hereby demised shall constitute an
actual or constructive eviction by Landlord, nor shall be
deemed an acceptance of a surrender of said demised
premises, and no agreement to accept such surrender shall
be valid unless in writing signed by Landlord. In the
event that any payment herein provided for by Tenant to
Landlord shall become overdue for a period in excess of
ten (10) days, then at Landlord's option a "late charge"
for such period and for each additional period of twenty
(20) days or any part thereof shall become immediately
due and owing to Landlord, as additional rent by reason
of the failure of Tenant to make prompt payment, at the
following rates: for individual and partnership tenants,
said late charge shall be computed at the maximum legal
rate of interest; for corporate or governmental entity
tenants the late charge shall be computed at two percent
per month unless there is an applicable maximum legal
rate of interest which then shall be used. No employee of
Landlord or of Landlord's agents shall have any power to
accept the keys of said premises prior to the termination
of the lease. The delivery of keys to any employee of
Landlord or of Landlord's agents shall not operate as a
termination of the lease or a surrender of the premises.
In the event of Tenant at any time desiring to have
Landlord sublet the premises for Tenant's account.
Landlord or Landlord's agents are authorized to receive
said keys for such purposes without releasing Tenant from
any of the obligations under this lease, and Tenant
hereby relieves Landlord of any liability for loss of or
damage to any of Tenant's effects in connection with such
subletting.
(c) The failure of Landlord to seek redress for
violation of, or to insist upon the strict performance
of, any covenant or condition of this lease, or any of
the Rules and Regulations set forth or hereafter adopted
by Landlord, shall not prevent a subsequent act, which
would have originally constituted a violation, from
having all the force and effect of an original violation.
The receipt by Landlord of rent with knowledge of the
breach of any covenant of this lease shall not be deemed
a waiver of such breach.
(d) The failure of Landlord to enforce any of the
Rules and Regulations set forth, or hereafter adopted,
against Tenant and/or any other tenant in the building
shall not be deemed a waiver of any such Rules and
Regulations. No provision of this lease shall be deemed
to have been waived by Landlord, unless such waiver be in
writing signed by Landlord.
(e) No payment by Tenant or receipt by Landlord of a
lesser amount than the monthly rent herein stipulated
shall be deemed to be other than on account of the
earliest stipulated rent, nor shall any endorsement or
statement on any check or any letter accompanying any
check or payment as rent be deemed an accord and
satisfaction, and Landlord may accept such check or
payment without prejudice to Landlord's right to recover
the balance of such rent or pursue any other remedy in
this lease provided.
LICENSE FORTY-FIFTH:--Tenant covenants that Tenant will
not, without the consent of Landlord first obtained in
each case, make or grant any license in respect of the
demised premises or any part thereof, or in respect of
the use thereof, and will not permit any such license to
be made or granted.
16
FORTY-SIXTH:--Landlord shall replace, at the GLASS AND
expense of Tenant, any and all plate and other glass GLASS
damaged or broken from any cause whatsoever in and about INSURANCE
the demised premises. Landlord may insure, and keep
insured, at Tenant's expense, all plate and other glass
in the demised premises for and in the name of Landlord.
Bills for the premiums therefor shall be rendered by
Landlord to Tenant at such times as Landlord may elect,
and shall be due from, and payable by, Tenant when
rendered, and the amount thereof shall be deemed to be,
and be paid as, additional rent.
FORTY-SEVENTH:--If an excavation shall be made upon ADJACENT
land adjacent to the demised premises, or shall be EXCAVATION-
authorized to be made, Tenant shall afford to the person SHORING
causing or authorized to cause such excavation, license
to enter upon the demised premises for the purpose of
doing such work as said person shall deem necessary to
preserve the wall or the building of which demised
premises form a part from injury or damage and to support
the same by proper foundations without any claim for
damages or indemnity against Landlord, or diminution or
abatement of rent.
FORTY-EIGHTH:--Except as otherwise in this lease BILLS AND
provided, a bill, statement, notice or communication NOTICES
which Landlord may desire or be required to give to
Tenant, shall be deemed sufficiently given or rendered if
in writing delivered to Tenant personally or sent by
registered or certified mail addressed to Tenant at the
building of which the demised premises form a part or at
the last known residence address or business address of
Tenant or left at any of the aforesaid premises addressed
to Tenant, and the time of the rendition of such bill or
statement and of the giving of such notice or
communication shall be deemed to be the time when the
same is delivered to Tenant, mailed, or left at the
premises as herein provided. Any notice by Tenant to
Landlord must be served by registered or certified mail
addressed to Landlord at the address first hereinabove
given or at such other address as Landlord shall
designate by written notice.
FORTY-NINTH:--If and so long as Tenant pays the QUIET
rent and additional rent reserved hereby and performs and ENJOYMENT
observes the covenants and provisions hereof. Tenant
shall quietly enjoy the demised premises, subject,
however, to the terms, conditions, exceptions and
reservations of this lease, and to the ground, underlying
and overriding leases and mortgages hereinbefore
mentioned.
FIFTIETH:--Upon the expiration or other termination QUIT AND
of the term of this lease, Tenant shall quit and SURRENDER
surrender to Landlord the demised premises, broom clean,
in good order and condition, ordinary wear excepted.
Lessee acknowledges that possession of the demised
premises must be surrendered to the Lessor at the
expiration or sooner termination of the term of this
Lease. Lessee agrees it shall indemnify and save Lessor
harmless against costs, claims, loss or liability
resulting from delay by Lessee in so surrendering the
demised premises, including, without limitation, any
claims made by any succeeding tenant, founded on such
delay. The parties recognize and agree that the damage to
Lessor resulting from any failure by Lessee timely to
surrender possession of the demised premises as aforesaid
will be extremely substantial, will exceed the amount of
monthly rent theretofore payable hereunder, and will be
impossible of accurate measurement Lessee therefore
agrees that if possession of the demised premises is not
surrendered to Lessor within seven (7) days after the
date of the expiration or termination of the term of this
Lease, then Lessee agrees to pay Lessor as liquidated
damages for each month and for each portion of any month
during which Lessee holds over in the premises after
expiration or termination of the term of this Lease, a
sum equal to three times the average rent and additional
rent which was payable per month under this Lease during
the last six months of the term thereof. The aforesaid
provisions of this article shall survive the expiration
or sooner termination of the term of this Lease. If the
last day of the term of this lease or any renewal thereof
falls on Sunday, this lease shall expire on the business
day immediately preceding.
FIFTY-FIRST:--If Landlord shall be unable to give FAILURE
possession of the demised premises on the date of the TO GIVE
commencement of the term hereof for any reason. Landlord POSSESSION
shall not be subject to any liability. Under such
circumstances, the rent reserved and covenanted to be
paid herein shall not commence until the possession of
demised premises is given or the premises are available
for occupancy by Tenant, and no such failure to give
possesion on the date of commencement of the term shall
in any wise affect the validity of this lease or the
obligations of Tenant hereunder, nor shall same be
construed in any wise to extend the term of this lease.
If Landlord is unable to give possession of the demised
premises on the date of the commencement of the term
hereof by reason of the holding over or retention of
possession of any tenant, tenants or occupants or for any
other reason, or if repairs, improvements or decorations
of the demised premises or of the building of which said
premises form a part, are not completed, no abatement or
diminution of the rent to be paid hereunder shall be
allowed to Tenant nor shall the validity of the lease be
impaired under such circumstances. If permission is given
to Tenant to enter into the possession of the demised
premises or to occupy premises other
17
than the demised premises prior to the date specified as
the commencement of the term of this lease. Tenant
covenants and agrees that such occupancy shall be deemed
to be under all the terms, covenants, conditions and
provisions of this lease, except as to the covenant to
pay rent. In either case rent shall commence on the date
specified in this lease.
REPRESENTATIONS FIFTY-SECOND:--Landlord or Landlord's agents have
made no representations or promises with respect to the
said building or demised premises except as herein
expressly set forth. The taking possession of the demised
premises by Tenant shall be conclusive evidence, as
againt Tenant, that Tenant accepts same "as is" and that
said premises and the building of which the same form a
part were in good and satisfactory condition at the time
such possession was so taken.
RENT CONTROL FIFTY-THIRD:--In the event the fixed annual rent or
additional rent or any part thereof provided to be paid
by Lessee under the provisions of this lease during the
demised term shall become uncollectible or shall be
reduced or required to be reduced or refunded by virtue
of any Federal, State, County or City law, order or
regulation, or by any direction of a public officer or
body pursuant to law, or the orders, rules, code, or
regulations of any organization or entity formed pursuant
to law. whether such organization or entity be public or
private, then Lessor, at its option, may at any time
thereafter terminate this lease, by not less than thirty
(30) days' written notice to Lessee, on a date set forth
in said notice, in which event this lease and the term
hereof shall terminate and come to an end on the date
fixed in said notice as if the said date were the date
originally fixed herein for the termination of the
demised term. Lessor shall not have the right so to
terminate this lease if Lessee within such period
of thirty (30) days shall in writing lawfully agree that
the rentals herein reserved are reasonable rentals and
agree to continue to pay said rentals and if such
agreement by Lessee shall be legally enforceable by
Lessor.
COVENANTS FIFTY-FOURTH:--The covenants, conditions and
BINDING agreements contained in this lease shall bind and inure
SUCCESSORS to the benefit of Landlord and Tenant and their
respective heirs, distributees, executors,
administrators, successors, and, except as otherwise
provided in this lease, their assigns.
LEASE FIFTY-FIFTH:--Except as may be otherwise contained
EMBODIES in a written instrument or instruments duly executed and
UNDER STANDING delivered by and between the parties hereto, this lease
OF PARTIES contains the entire agreement and understanding of the
parties with respect to the demised premises and the
respective rights and duties of the parties in relation
thereto and in relation to each other. There are no oral
understandings or agreements between the parties of any
kind. Landlord has made no representations or warranties
to Tenant of any kind. All oral representations,
warranties and promises prior to or contemporaneous with
this written lease (if any be claimed) are and shall be
deemed merged into this lease. This lease cannot be
changed or supplemented orally. All promises and
agreements made by or between the parties subsequent to
the execution and delivery of this lease shall be and be
deemed to be null, void and unenforceable unless
contained in a writing duly executed and delivered by and
between the parties hereto, whether or not the same
relate in any way to this lease or any matter covered
hereby.
DEFINITIONS FIFTY-SIXTH:-- (a) The term "Landlord" as used in
this lease means only the owner or the mortgagee in
possession for the time being, of the land and building
(or the owner of a lease of the entire building or of the
land and entire building) of which the demised premises
form a part so that in the event of any sale or sales of
said land and entire building or of any transfer or
conveyance of said lease or in the event of a lease of
said entire building or of the land and entire building,
the said Landlord shall be and hereby is entirely freed
and relieved of all liability for the performance of all
covenants and obligations on the part of Landlord to be
performed hereunder, and it shall be deemed and
considered without further agreement between the parties
or other successors in interest or between the parties
and the purchaser at any such sale or any transferee or
mortgagee or any lessee of the entire building or of the
land and entire building that the purchaser, lessee,
transferee or grantee has assumed and agreed to carry out
any and all covenants and obligations of Landlord
hereunder. Tenant acknowledges that it has been informed
and understands that Landlord is a lessee of the land and
entire building of which the demised premises form a
part. The term "lease of the entire building or of the
land and entire building" shall be deemed to include a
sublease thereof, and the term "lessee of the entire
building or of the land and entire building" shall be
deemed to include a sublessee thereof.
(b) The words "re-entry" as used in this lease are
not restricted to their technical legal meaning.
(c) The term "business days" as used in this lease
shall exclude Saturdays (except such portion thereof as
is covered by the insertion of specific hours herein).
Sundays and all days observed by the State or Federal
Government as legal holidays.
18
(d) From time to time, Tenant, on at least ten (10)
days' prior written request by Landlord, will deliver to
Landlord a statement in writing certifying that this
lease is unmodified and in full force and effect (or if
there shall have been modifications, that the same is in
full force and effect as modified and stating the
modifications) and the dates to which the rent and other
charges have been paid and stating whether or not
Landlord is in default in performance of any covenant,
agreement or condition contained in this lease and if so,
specifying each such default of which Tenant may have
knowledge.
FIFTY-SEVENTH:-- The fixed annual rent reserved in COST OF LIVING
this lease and payable hereunder shall be adjusted, as of ADJUSTMENTS
the times and in the manner set forth in this Article:
(a) Definitions: For the purposes of this Article,
the following definitions shall apply:
(i) The term "Base Year" shall mean the full 1994 (see Ric 4% Cap
calendar year during which the term of this lease
commences.
(ii) The term "Price Index" shall mean the 'Consumer
Price Index' published by the Bureau of Labor -
Statistics of the U.S. Department of Labor, All Items,
New York, N.Y.--Northeastern, N.J., all urban consumers
(presently denominated "CPI-U"), or a successor or
substitute index appropriately adjusted.
(iii) The term "Price Index for the Base Year" shall
mean the average of the monthly All Items Price Indexes
for each of the 12 months of the Base Year.
(b) Effective as of each January and July subsequent
to the Base Year, there shall be made a cost of living
adjustment of the fixed annual rental rate payable
hereunder. The July adjustment shall be based on the
percentage difference between the Price Index for the
preceding month of June and the Price Index for the Base
Year. The January adjustment shall be based on such
percentage difference between the Price Index for the
preceding month of December and the Price Index for the
Base Year.
(i) In the event the Price Index for June in any
calendar year during the term of this lease reflects an
increase over the Price Index for the Base Year, then the
fixed annual rent herein provided to be paid as of the
July 1st following such month of June (unchanged by any
adjustments under this Article) shall be multiplied by
the percentage difference between the Price Index for
June and the Price Index for the Base Year, and the
resulting sum shall be added to such fixed annual rent,
effective as of such July 1st. Said adjusted fixed annual
rent shall thereafter be payable hereunder, in equal
monthly installments, until it is readjusted pursuant to
the terms of this lease.
(ii) In the event the Price Index for December in
any calendar year during the term of this lease reflects
an increase over the Price Index for the Base Year, then
the fixed annual rent herein provided to be paid as of
the January 1st following such month of December
(unchanged by any adjustments under this Article) shall
be multiplied by the percentage difference between the
Price Index for December and the Price Index for the Base
Year, and the resulting sum shall be added to such fixed
annual rent effective as of such January 1st. Said
adjusted fixed annual rent shall thereafter be payable
hereunder, in equal monthly installments, until it is
readjusted pursuant to the terms of this lease.
The following illustrates the intentions of the
parties hereto as to the computation of the
aforementioned cost of living adjustment in the annual
rent payable hereunder.
Assuming that said fixed annual rent is $10,000,
that the Price Index for the Base Year was 102.0 and that
the Price Index for the month of June in a calendar year
following the Base Year was 105.0, then the percentage
increase thus reflected, i.e. 2.941% (3.0/102.0) would be
multiplied by 510,000, and said fixed annual rent would
be increased by $294.10 effective as of July 1st of said
calendar year.
In the event that the Price Index ceases to use
82-84=100 as the basis of calculation or if a substantial
change is made in the terms or number of items contained
in the Price Index, then the Price Index shall be
adjusted to the figure that would have been arrived at
had the manner of computing the Price Index in effect at
the date of this lease not been altered. In the event
such Price Index (or a successor or substitute index) is
not available, a reliable governmental or other
non-partisan publication evaluating the information
theretofore used in determining the Price Index shall be
used.
No adjustments or recomputations, retroactive or
otherwise, shall be made due to any revision which may
later be made in the first published figure of the Price
Index for any month.
19
(c) Landlord will cause statements of the cost of
living adjustments provided for in subdivision (b) to be
prepared in reasonable detail and delivered to Tenant.
(d) In no event shall the fixed annual rent
originally provided to be paid under this lease
(exclusive of the adjustments under this Article) be
reduced by virtue of this Article.
(e) Any delay or failure of Landlord, beyond July or
January of any year, in computing or billing for the rent
adjustments hereinabove provided, shall not constitute a
waiver of or in any way impair the continuing obligation
of Tenant to pay such rent adjustments hereunder.
(f) Notwithstanding any expiration or termination of
this lease prior to the lease expiration date (except in
the case of a cancellation by mutual agreement) Tenant's
obligation to pay rent as adjusted under this Article
shall continue and shall cover all periods up to the
lease expiration date, and shall survive any expiration
or termination of this lease.
TAX FIFTY-EIGHTH:-- Tenant shall pay to Landlord, as
ESCALATION additional rent, tax escalation in accordance with this
Article:
(a) Definitions: For the purpose of this Article,
the following definitions shall apply:
(i) The term "base tax year" as hereinafter set
forth for the determination of real estate tax
escalation, shall mean the New York City real estate
tax year commencing July 1, 1994 and ending June 30,
1995.
(ii) The term "The Percentage", for purposes of
computing tax escalation, shall mean Two & ten
hundreths of one percent (2.10%). The Percentage has
been computed on the basis of a fraction, the
numerator of which is the rentable square foot area
of the presently demised premises and the
denominator of which is the total rentable square
foot area of the office and commercial space in the
building project. The parties acknowledge and agree
that the rentable square foot area of the presently
demised premises shall be deemed to be 10,624 sq.ft.
and that the total rentable square foot area of the
office and commercial space in the building project
shall be deemed to be 505,591 sq.ft.
(iii) The term "the building project" shall
mean the aggregate combined parcel of land on a
portion of which are the improvements of which the
demised premises form a part, with all the
improvements thereon, said improvements being a part
of the block and lot for tax purposes which are
applicable to the aforesaid land.
(iv) The term "comparative year" shall mean the
twelve (12) months following the base tax year, and
each subsequent period of twelve (12) months (or
such other period of twelve (12) months occurring
during the term of this lease as hereafter may be
duly adopted as the fiscal year for real estate tax
purposes by the City of New York).
(v) The term "real estate taxes" shall mean the
total of all taxes and special or other assessments
levied, assessed or imposed at any time by any
governmental authority upon or against the building
project, and also any tax or assessment levied,
assessed or imposed at any time by any governmental
authority in connection with the receipt of income
or rents from said building project to the extent
that same shall be in lieu of all or a portion of
any of the aforesaid taxes or assessments, or
additions or increases thereof, upon or against said
building project. If, due to a future change in the
method of taxation or in the taxing authority, or
for any other reason, a franchise, income, transit,
profit or other tax or governmental imposition,
however designated, shall be levied against Landlord
in substitution in whole or in part for the real
estate taxes, or in lieu of additions to or
increases of said real estate taxes, then such
franchise, income, transit, profit or other tax or
governmental imposition shall be deemed to be
included within the definition of "real estate
taxes" for the purposes hereof. As to special
assessments which are payable over a period of time
extending beyond the term of this lease, only a pro
rata portion thereof, covering the portion of the
term of this lease unexpired at the time of the
imposition of such assessment, shall be included in
"real estate taxes". If, by law, any assessment may
be paid in installments, then, for the purposes
hereof (a) such assessment shall be deemed to have
been payable, in the maximum number of installments
permitted by law and (b) there shall be included in
real estate taxes, for each comparative year in
which such installments may be paid, the
installments of such assessment so becoming payable
during such comparative year, together with interest
payable during such comparative year.
20
(vi) Where a "transition assessment" is imposed
by the City of New York for any tax (fiscal) year,
then the phrases "assessed value" and "assessments"
shall mean the transition assessment for that tax
(fiscal) year.
(vii) The phrase "real estate taxes payable
during the base tax year" shall mean that amount
obtained by multiplying the assessed value of the
land and buildings of the building project for the
base tax year by the tax rate for the base tax year
for each $100 of such assessed value.
(b) 1. In the event that the real estate taxes
payable for any comparative year shall exceed the amount
of the real estate taxes payable during the base tax
year, Tenant shall pay to Landlord, as additional rent
for such comparative year, an amount equal to The
Percentage of the excess. Before or after the start of
each comparative year, Landlord shall furnish to Tenant a
statement of the real estate taxes payable for such
comparative year, and a statement of the real estate
taxes payable during the base tax year. If the real
estate taxes payable for such comparative year exceed the
real estate taxes payable during the base tax year,
additional rent for such comparative year, in an amount
equal to The Percentage of the excess, shall be due from
Tenant to Landlord, and such additional rent shall be
payable by Tenant to Landlord within ten (10) days after
receipt of the aforesaid statement The benefit of any
discount for any earlier payment or prepayment of real
estate taxes shall accrue solely to the benefit of
Landlord, and such discount shall not be subtracted from
the real estate taxes payable for any comparative year.
2. Should the real estate taxes payable during the
base tax year be reduced by final determination of legal
proceedings, settlement or otherwise, then, the real
estate taxes payable during the base tax year shall be
correspondingly revised, the additional rent theretofore
paid or payable hereunder for all comparative years shall
be recomputed on the basis of such reduction, and Tenant
shall pay to Landlord as additional rent, within ten (10)
days after being billed therefor, any deficiency between
the amount of such additional rent as theretofore
computed and the amount thereof due as the result of such
recomputations. Should the real estate taxes payable
during the base tax year be increased by such final
determination of legal proceedings, settlement or
otherwise, then appropriate recomputation and adjustment
also shall be made.
3. If, after Tenant shall have made a payment of
additional rent under this subdivision (c), Landlord
shall receive a refund of any portion of the real estate
taxes payable for any comparative year after the base tax
year on which such payment of additional rent shall have
been based, as a result of a reduction of such real
estate taxes by final determination of legal proceedings,
settlement or otherwise, Landlord shall within ten (10)
days after receiving the refund pay to Tenant The
Percentage of the refund less The Percentage of expenses
(including attorneys' and appraisers' fees) incurred by
Landlord in connection with any such application or
proceeding. If, prior to the payment of taxes for any
comparative year, Landlord shall have obtained a
reduction of that comparative year's assessed valuation
of the building project, and therefore of said taxes,
then the term "real estate taxes" for that comparative
year shall be deemed to include the amount of Landlord's
expenses in obtaining such reduction in assessed
valuation, inducting attorneys' and appraisers' fees.
4. The statements of the real estate taxes to be
furnished by Landlord as provided above shall be
certified by Landlord and shall constitute a final
determination as between Landlord and Tenant of the real
estate taxes for the periods represented thereby, unless
Tenant within thirty (30) days after they are furnished
shall give a written notice to Landlord that it disputes
their accuracy or their appropriateness, which notice
shall specify the particular respects in which the
statement is inaccurate or inappropriate. If Tenant shall
so dispute said statement then, pending the resolution of
such dispute, Tenant shall pay the additional rent to
Landlord in accordance with the statement furnished by
Landlord.
5. In no event shall the fixed annual rent under
this' lease (exclusive of the additional rents under this
Article) be reduced by virtue of this Article.
6. If the commencement date of the term of this
lease is not the first day of the first comparative year,
then the additional rent due hereunder for such first
comparative year shall be a proportionate share of said
additional rent for the entire comparative year, said
proportionate share to be based upon the length of time
that the lease term will be in existence during such
first comparative year. Upon the date of any expiration
or termination of this lease (except termination because
of Tenant's default) whether the same be the date
hereinabove set forth for the expiration of the term or
any prior or subsequent date, a proportionate share of
said additional rent for the comparative year during
which such expiration or termination occurs shall
immediately become due and payable by Tenant to Landlord,
if it was not theretofore already billed and paid. The
said proportionate share shall be based upon the length
of time that this lease shall have been in existence
21
during such comparative year. Landlord shall promptly
cause statements of said additional rent for that
comparative year to be prepared and furnished to Tenant.
Landlord and Tenant Shall thereupon make appropriate
adjustments of amounts then owing.
7. Landlord's and Tenant's obligations to make the
adjustments referred to in Subdivision (6) above shall
survive any expiration or termination of this lease.
8. Any delay or failure of Landlord in billing any
tax escalation hereinabove provided shall not constitute
a waiver of or in any way impair the continuing
obligation of Tenant to pay such tax escalation
hereunder.
OCCUPANCY AND USE FIFTY-NINTH:--(A). Tenant acknowledges that its
BY TENANT continued occupancy of the demised premises, and the
regular conduct of its business therein, are of utmost
importance to the Landlord in the renewal of other leases
in the building, in the renting of vacant space in the
building, in the providing of electricity, air
conditioning, steam and other services to the tenants in
the building, and in the maintenance of the character and
quality of the tenants in the building. Tenant therefore
covenants and agrees that it win occupy the entire
demised premises and will conduct its business therein
in the regular and usual manner, throughout the term of
this lease. Tenant acknowledges that Landlord is
executing this lease in reliance upon these covenants and
that these covenants are a material element of
consideration inducing the Landlord to execute this
lease. Tenant further agrees that if it vacates the
demised premises or fails to so conduct its business
therein, at any time during the term of this lease,
without the prior written consent of the Landlord, then
all rent and additional rent reserved in this lease from
the date of such breach to the expiration date of this
lease shall become immediately due and payable to
Landlord.
(B). The parties recognize and agree that the damage
to Landlord resulting from any breach of the covenants in
subdivision (A) hereof will be extremely substantial will
be far greater than the rent payable, for the balance of
the term of this lease, and will be impossible of
accurate measurement. The parties therefore agree that in
the event of a breach or threatened breach of the said
covenants, in addition to all of Landlord's other rights
and remedies, at law or in equity or otherwise, Landlord
shall have the right of injunction to preserve Tenant's
occupancy and use. The words "become vacant or deserted"
as used elsewhere in this lease shall include Tenant's
failure to occupy or use as by this Article required.
(C). If Tenant breaches either of the covenants in
subdivision (A) above, and this lease be terminated
because of such default, then, in addition to Landlord's
rights of re-entry, restoration, preparation for and
rerental, and anything elsewhere in this lease to the
contrary notwithstanding, Landlord shall retain its right
to judgment on and collection of Tenant's aforesaid
obligation to make a single payment to Landlord of a sum
equal to the total of all rent and additional rent
reserved for the remainder of the original term of this
lease, subject to future credit or repayment to Tenant in
the event of any rerenting of the premises by Landlord,
after first deducting from rerental income all expenses
incurred by Landlord in reducing to judgment or otherwise
collecting Tenant's aforesaid obligation, and in
obtaining possession of, restoring, preparing for and
re-letting the premises. In no event shall Tenant be
entitled to a credit or repayment for rerental income
which exceeds the sums payable by Tenant hereunder or
which covers a period after the original term of this
lease.
(D). If any provision of this Article of this lease
or the application thereof to any person or circumstance
shall, to any extent, be invalid or unenforceable, the
remainder of this Article, or the application of such
provision to persons or circumstances other than those as
to which it is held invalid or unenforceable, shall not
be affected thereby, and each provision of this Article
and of this lease shall be valid and be enforced to the
fullest extent permitted by law.
SIXTIETH:--The Landlord shall be under no obligation
to provide access between the "A" Wing and the "B" Wing
on the floor of the premises demised herein, and any
passageways which may now or hereafter exist between said
wings may be discontinued at any time at the discretion
of the Landlord.
CAPTIONS SIXTY-FIRST:--The captions are inserted only as a
matter of convenience and for reference and in no way
define, limit or describe the scope of this lease nor the
intent of any provision thereof.
RULES AND SIXTY-SECOND:--Tenant and Tenant's servants,
REGULATIONS employees, agents, visitors, and licensees shall observe
and non-discriminate faithfully, and comply strictly
with, the Rules and Regulations and such other and
further reasonable and non-discrimination Rules and
Regulations as Landlord or Landlord's agents may from
time to time adopt. Notice of any additional rules or
regulations shall be given in such manner as Landlord may
elect. In case Tenant disputes the reasonableness of any
additional Rule or Regulation hereafter made or adopted
by Landlord or Landlord's agents, the parties hereto
agree to submit the question of the reasonableness of
such Rule or Regulation for decision to the
22
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 designate,
whose determination shall be final and conclusive upon
the parties hereto. The right to dispute the
reasonableness of any additional Rule or Regulation upon
Tenant's part shall be deemed waived unless the same
shall be asserted by service of a notice in writing
upon Landlord within ten (10) days after the adoption of
any such additional Rule or Regulation. Nothing in this
lease contained shall be construed to impose upon
Landlord any duty or obligation to enforce the Rules and
Regulations or terms, covenants or conditions in any
other lease, as against any other tenant and Landlord
shall not be liable to Tenant for violation of the same
by any other tenant, its servants, employees, agents,
visitors or licensees.
The use in the demised premises of auxiliary heating
devices, such as portable electric heaters, heat lamps or
other devices whose principal function at the time of
operation is to produce space heating is prohibited.
SIXTY-THIRD:-- It is understood and agreed that this
lease is submitted to Tenant on the understanding that it
shall not be considered an offer and shall not bind
Landlord in any way until (i) Tenant has duly executed
and delivered duplicate originals to Landlord and (ii)
Landlord has executed and delivered one of said originals
to Tenant.
23
In Witness Whereof, Landlord and Tenant have respectively signed and sealed this
lease as of the day and year first above written.
500/512 SEVENTH AVENUE ASSOCIATES
HELMSLEY-SPEAR, INC., AGENTS
- -------------------------------------
Witness for Landlord:
By: /s/ Irving Schneider
------------------------------------
EXECUTIVE VICE PRESIDENT
G-III LEATHER FASHIONS, INC.
- -------------------------------------
Witness for Tenant:
By: /s/ Alan Feller
------------------------------------
TENANT
24
ADDITIONAL CLAUSES attached to and forming a part of lease dated
January 31st, 1994 between 500-512 SEVENTH AVENUE ASSOCIATES and G-III LEATHER
FASHIONS, INC.
SIXTY FOURTH: It is understood and agreed tenant shall be permitted to list its
firm name or divisions of its firm but no more than five (5) listings in the
lobby board of the building. The charge to the tenant shall be $75.00 for all
listings plus tax, per side of building or the charge then in effect.
SIXTY FIFTH: It is understood and agreed that tenant shall have immediate
possession of the demised premises free of rent upon execution of this lease
through January 31, 1995, but shall be subject to all other terms and conditions
of this lease including the payment of electricity.
SIXTY SIXTH: Tenant shall perform all initial alteration work to make the
demised premises suitable and ready for Tenant's occupancy and use (the "Initial
Alteration Work"). Tenant shall, within sixty (60) days after the execution of
this Lease by Tenant, furnish Landlord for its approval a complete set of
architectural and engineering plans and specifications for such work including
air conditioning. Landlord, promptly upon receipt of same, shall approve such
plans and specifications, or return them with advice as to what changes are
required for its approval to be forthcoming.
Tenant, at its own cost and expense (except as herein provided),
will cause the initial Alteration Work to be effected in accordance with
Tenant's approved plans and specifications, pursuant to the provisions of
Article TWELFTH and FIFTEENTH, as supplemented by Article SIXTEENTH, hereof, and
in accordance with all applicable laws, rules and regulations.
Tenant as part of its Initial Alteration Work will install an air
conditioning unit or units sufficient to air condition all or part of the
demised premises. In connection therewith Tenant agrees to pay as Additional
Rent an Electric Riser Charge of $5.00 per ton, per month for each unit.
SIXTY SEVENTH: Provided Tenant is not then in material default under this Lease
beyond any grace period, Landlord will pay up to the first $265,600 ("Landlord's
Work Contribution") of the costs of labor and materials, excluding the costs of
Tenant's personal property, in effecting the Initial Alteration Work. If such
costs are lower than $265,600, the Landlord's aforedescribed contribution
obligation shall be satisfied by its paying such amount lower than $265,600. Any
such costs in excess of $265,600 shall be paid promptly by Tenant.
In connection with the Initial Alteration Work, Tenant shall
provide Landlord with true copies of paid bills, showing the cost of the items
of the Initial Alteration Work to be included in the aforesaid total up to
$265,600, and Landlord shall reimburse Tenant for the amount set forth in said
bills in accordance with Landlord's
obligation hereunder within twenty (20) days unless Landlord requests further
verification of payment.
SIXTY EIGHTH: Landlord agrees that, at its expense, it shall affect the
following work ("Landlord's Work") in and to the demised premises, in a Building
standard manner and using Building standard materials, which work shall
constitute Landlord's sole obligation hereunder:
1. Install bathrooms as required pursuant to the Americans With
Disabilities Act. Landlord will use best efforts to coordinate
its construction with that of Tenant.
2. Remove existing installations from the demised premises so that
same shall be delivered vacant and free of same in "shell"
condition.
Landlord shall substantially complete the portion of Landlord's
Work described in clause 1 above within 60 working days of the date hereof.
Landlord shall substantially complete the portion of Landlord's Work described
in clause 2 above within 30 working days of the date hereof. If Landlord fails
to complete any such portion of Landlord's Work within the time periods
specified above, Tenant shall have the right to have such work done by Tenant's
contractors and materialmen at Landlord's cost and expense. Landlord shall
reimburse Tenant promptly for such costs and expenses upon presentation by
Tenant of paid invoices therefor.
Anything herein contained to the contrary notwithstanding, the
time by which Landlord shall substantially complete the work required to be
performed by it in the demised premises shall be extended for such period as
Landlord is prevented from substantially completing such work due to strikes,
lockouts, labor disputes, Acts of God, governmental restrictions, enemy or
hostile governmental action, fire or other casualty, or any other reason beyond
Landlord's reasonable control. Further, if Landlord's work is not substantially
completed and is delayed by acts, omissions or changes made or requested by
Tenant, its agents, designers, architects or any other party acting or
apparently acting on Tenant's behalf, then the time by which Landlord shall
substantially complete the work required to be performed by it in the demised
premises shall be extended by the period or such delay.
SIXTY NINTH: Anything in Article FIFTY SEVENTH to the contrary notwithstanding,
the cost of living adjustment of the fixed annual rental rate computed as
provided in said Article FIFTY SEVENTH, which shall be payable for any single
calendar year, or for any portion thereof, shall not exceed an amount equal to
four percent (4%) of the fixed annual rental rate payable under this lease as
of December 1st or of the immediately preceding calendar year (including any
adjustments under Article FIFTY SEVENTH).
SEVENTIETH: Anything to the contrary contained in Article THIRTY FIFTH
notwithstanding, should Landlord elect not to give such notice of termination
and the demised premises are not restored so that Tenant may resume its regular
course of business operations within 180 days after such fire or other cause,
Tenant shall have the right to give Landlord a notice in writing of termination,
which notice shall be given as provided in this Lease and thereupon the term of
this Lease shall expire by lapse of time on the third day after such notice is
given, and Tenant shall vacate the demised premises and surrender same to
Landlord.
LANDLORD:
500-512 SEVENTH AVENUE ASSOCIATES
HELMSLEY-SPEAR, INC., AGENTS
By: /s/ Irving Schneider
------------------------------------
EXECUTIVES VICE PRESIDENT
TENANT:
G-III LEATHER FASHIONS, INC.
By: /s/ Alan Feller
------------------------------------
Name:
Title:
RULES AND REGULATIONS
1. The sidewalks, entrances, passages, courts, elevators, vestibules,
stairways, corridors or halls shall not be obstructed or encumbered by any
Tenant or used for any purpose other than ingress and egress to and from the
demised premises, and if said premises are situate on the ground floor of the
building the Tenant thereof shall further, at said Tenant's own expense, keep
the sidewalks and curb directly in front of said premises clean and free from
ice, snow, etc.
2. The freight and not the passenger elevators shall be used by the working
hands of Tenant and persons calling for and delivering goods to and from the
demised premises.
3. No awnings or other projections shall be attached to the outside walls
of the building without the prior written consent of Landlord. No curtains,
blinds, shades or screens shall be attached to or hung in, or used in connection
with, any window or door of the demised premises, without the prior written
consent of the Landlord. Such awnings, projections curtains, blinds, shades,
screens or other fixtures must be of a quality, type, design and color, and
attached in the manner approved by Landlord.
4. No sign, advertisement, notice or other lettering shall be exhibited,
inscribed, painted or affixed by any Tenant on any part of the outside or inside
of the demised premises or building without the prior written consent of
Landlord. Interior signs on doors shall be inscribed, painted or affixed for
each Tenant by Landlord at the expense of such Tenant, and shall be of a size,
color and style acceptable to Landlord. Only the Tenant named in the lease shall
be entitled to appear on the Directory Board or Tablet. Additional names may be
added in Landlord's sole discretion under such terms and conditions as he may
approve.
5. The sashes, sash doors, skylights, windows and doors that reflect or
admit light and air into the halls, passageways or other public places in the
building shall not be covered by any Tenant, nor shall any bottles, parcels, or
other articles be placed on the windowsills.
6. The water and wash closets and other plumbing fixtures shall not be used
for any purposes other than those for which they were constructed, and no
sweepings, rubbish, rags, or other substances shall be thrown therein. All
damages resulting from any misuse of the fixtures shall be borne by Tenant who,
or whose servants, employees, agents, visitors or licensees, shall have caused
the same.
7. No Tenant shall mark, paint, drill into, or in any way deface any part
of the demised premises or the building of which they form a part. No boring,
cutting or stringing of wires shall be permitted, except with the prior written
consent of Landlord, and as Landlord may direct. No linoleum or other floor
covering shall be laid in direct contact with the floor of the demised premises,
but if any such covering is required by Tenant, an interlining of builder's
deadening felt shall first be affixed to the floor with paste or other water
soluble material, the use of cement or other adhesive non-soluble in water is
expressly prohibited.
8. No Tenant shall make, or permit to be made, any unseemly or disturbing
noises or disturb or interfere with occupants of this or neighboring buildings
or premises or those having business with them whether by the use of any
instrument, radio, talking machine, musical noise, whistling, singing or in any
other way.
9. No Tenant, nor any of Tenant's servants, employees, agents, visitors, or
licensees, shall at any time bring or keep upon the demised premises any
inflammable, combustible or explosive fluid, chemical and substance, or cause or
permit any unusual or objectionable odors to be produced upon or permeate from
the demised premises. No animals or birds shall be kept by Tenant in or about
the building.
10. Landlord reserves the right to inspect all freight to be brought into
the building and to exclude from the building all freight which violates any of
these Rules and Regulations or the lease of which these Rules and Regulations
are a part.
11. Landlord shall have the right to prohibit any advertising by any Tenant
which, in its opinion, tends to impair the reputation of the building or its
desirability and, upon written notice from Landlord. Tenant shall refrain from
or discontinue such advertising.
12. Canvassing, soliciting and peddling in the building is prohibited and
each Tenant shall co-operate to prevent the same.
13. There shall not be used in any space, or in the public halls of any
building, either by any Tenant or by jobbers or others, in the delivery or
receipt of merchandise, any hand trucks, except those equipped with rubber tires
and side guards.
14. No Tenant shall purchase spring water, ice. towels, or other like
service, from any company or persons not approved by Landlord.
15. The use in the demised premises of auxiliary heating devices, such as
portable electric heaters, heat lamps or other devices whose principal function
at the time of operation is to produce space heating, is prohibited.
26
[MAP OMITTED]
NAVARRE MERCANTILE BUILDING, S. W. Corner 7th Ave & 38th Street
EXECUTION COPY
1 OF 7
================================================================================
FIRST AMENDMENT TO LEASE
BETWEEN
500-512 SEVENTH AVENUE LIMITED PARTNERSHIP, LANDLORD
AND
G-III LEATHER FASHIONS, INC., TENANT
PREMISES:
ENTIRE 33RD FLOOR
512 SEVENTH AVENUE
NEW YORK, NEW YORK
================================================================================
FIRST AMENDMENT TO LEASE
THIS FIRST AMENDMENT TO LEASE (this "Amendment") made as of the 1st day of
July, 2000, by and between 500-512 SEVENTH AVENUE LIMITED PARTNERSHIP, a New
York limited partnership, having an office c/o Newmark & Company Real Estate,
Inc. ("Landlord"), and G-III LEATHER FASHIONS, INC., a New York corporation,
having an office at 512 Seventh Avenue, New York, New York ("Tenant").
WITNESSETH:
WHEREAS, by Agreement of Lease dated as of January 31, 1994 (such lease, as
the same may have been or may hereafter be amended, is hereinafter called the
"Lease"), Landlord's predecessor-in-interest, did demise and let unto Tenant and
Tenant did hire and take from Landlord's predecessor-in-interest the entire
thirty-third (33rd) floor (the "demised premises") as more particularly
described in the Lease in the building (the "Building") known by the street
address 512 Seventh Avenue, New York, New York;
WHEREAS, the term of the Lease currently expires on January 31, 2003;
WHEREAS, Tenant desires to extend the term of the Lease and Landlord is
agreeable thereto on the terms and conditions hereinafter set forth; and
WHEREAS, Landlord and Tenant desire to modify and amend the Lease as
hereinafter provided.
NOW, THEREFORE, for and in consideration of the mutual covenants herein
contained and other good and valuable consideration, the adequacy and receipt of
which are hereby acknowledged, Landlord and Tenant hereby agree as follows:
1. All capitalized terms used herein shall have the meanings ascribed to
them in the Lease unless otherwise specifically set forth herein to the
contrary.
2. The term of the Lease is hereby extended for an additional term (the
"Extended Term") of ten (10) years and nine (9) months commencing on July 1,
2000 (the "Extended Term Commencement Date") and ending on March 31, 2011 (the
"Expiration Date"), as if the Expiration Date was originally set forth in the
Lease as the expiration date thereof, instead of January 31, 2003.
3. Effective as of the first day of the Extended Term:
(a) The fixed annual rent to be paid by Tenant to Landlord under the
Lease during the Extended Term shall be abated during the period commencing on
the Extended Term Commencement Date and ending on December 31, 2000, and
thereafter shall be payable as follows:
(i) For the period commencing on January 1, 2001 and ending on
December 31, 2001, the fixed annual rent shall be Two Hundred Seventy-Six
Thousand Two Hundred Twenty-Four and 00/100 Dollars ($276,224.00) per year, or
Twenty-Three Thousand Eighteen and 67/100 Dollars ($23,018.67) per month;
(ii) For the period commencing on January 1, 2002 and ending on
December 31, 2002, the fixed annual rent shall be Two Hundred Eighty-Four
Thousand Five Hundred Ten and 72/100 Dollars ($284,510.72) per year, or
Twenty-Three Thousand Seven Hundred Nine and 23/100 Dollars ($23,709.23) per
month;
(iii) For the period commencing on January 1, 2003 and ending on
December 31, 2003, the fixed annual rent shall be Two Hundred Ninety-Three
Thousand Forty-Six and 04/100 Dollars ($293,046.04) per year, or Twenty-Four
Thousand Four Hundred Twenty and 50/100 Dollars ($24,420.50) per month;
(iv) For the period commencing on January 1, 2004 and ending on
December 31, 2004, the fixed annual rent shall be Three Hundred One Thousand
Eight Hundred Thirty-Seven and 42/100 Dollars ($301,837.42) per year, or
Twenty-Five Thousand One Hundred Fifty-Three and 12/100 Dollars ($25,153.12) per
month;
(v) For the period commencing on January 1, 2005 and ending on
December 31, 2005, the fixed annual rent shall be Three Hundred Ten Thousand
Eight Hundred Ninety-Two and 55/100 Dollars ($310,892.55) per year, or
Twenty-Five Thousand Nine Hundred Seven and 71/100 Dollars ($25,907.71) per
month;
(vi) For the period commencing on January 1, 2006 and ending on
December 31, 2006, the fixed annual rent shall be Three Hundred Sixty-Two
Thousand Six Hundred Seventy-Nine and 99/100 Dollars ($362,679.99) per year, or
Thirty Thousand Two Hundred Twenty-Three and 33/100 Dollars ($30,223.33) per
month;
-2-
(vii) Notwithstanding anything to the contrary contained herein,
for the period commencing on January 1, 2006 and ending on March 31, 2006, the
fixed annual rent shall be abated;
(viii) For the period commencing on January 1, 2007 and ending on
December 31, 2007, the fixed annual rent shall be Three Hundred Seventy-Two
Thousand Two Hundred Eighty-Five and 51/100 Dollars ($372,285.51) per year, or
Thirty-One Thousand Twenty-Three and 79/100 Dollars ($31,023.79) per month;
(ix) For the period commencing on January 1, 2008 and ending on
December 31, 2008, the fixed annual rent shall be Three Hundred Eighty-Two
Thousand One Hundred Seventy-Nine and 19/100 Dollars ($382,179.19) per year, or
Thirty-One Thousand Eight Hundred Forty-Eight and 27/100 Dollars ($31,848.27)
per month;
(x) For the period commencing on January 1, 2009 and ending on
December 31, 2009, the fixed annual rent shall be Three Hundred Ninety-Two
Thousand Three Hundred Sixty-Nine and 69/100 Dollars ($392,369.69) per year, or
Thirty-Two Thousand Six Hundred Ninety-Seven and 47/100 Dollars ($32,697.47) per
month;
(xi) For the period commencing on January 1, 2010 and ending on
December 31, 2010, the fixed annual rent shall be Four Hundred Two Thousand
Eight Hundred Sixty-Five and 90/100 Dollars ($402,865.90) per year, or
Thirty-Three Thousand Five Hundred Seventy-Two and 16/100 Dollars ($33,572.16)
per month; and
(xii) For the period commencing on January 1, 2011 and ending on
March 31, 2011, the fixed annual rent shall be Four Hundred Thirteen Thousand
Five Hundred Ninety-Two and 32/100 Dollars ($413,592.32) per year, or
Thirty-Four Thousand Four Hundred Sixty-Six and 03/100 Dollars ($34,466.03) per
month.
Except as set forth above, the fixed annual rent shall be paid by
Tenant to Landlord in equal monthly installments in advance on the first day of
each and every month without any set-off or deduction whatsoever in the manner
provided in the Lease.
(b) The Fourth Article of the Lease is hereby deleted and the
following is substituted therefor:
-3-
"Tenant shall use and occupy the demised premises for showroom,
design, general offices and sales offices for sale at wholesale
and not retail, of all apparel and accessories."
(c) The Tenth Article of the Lease is hereby deleted and the following
is substituted therefor:
"TENTH: - (i) Tenant shall not (A) assign or otherwise transfer this Lease
or the term and estate hereby granted, (B) sublet the demised premises or
any part thereof or allow the same to be used or occupied by others or in
violation of Fourth Article hereof, (C) mortgage, pledge or encumber this
Lease or the demised premises or any part thereof in any manner or permit
any lien to be filed against this Lease, the demised premises or the
Building by reason of any act or omission on the part of Tenant or enter
into any agreement which would permit the filing of a lien by any broker
(except for a broker's agreement in connection with a proposed assignment
by Tenant of its rights and obligations under the Lease or a sublease of
all or a portion of the demised premises), or (D) advertise, or authorize a
broker to advertise, for a subtenant or an assignee at a specified rental
rate without, in each instance, obtaining the prior consent of Landlord,
except as otherwise expressly provided in this Article 10. For purposes of
this Article 10, (w) the transfer of a majority of the issued and
outstanding capital stock of any corporate tenant, or of a corporate
subtenant, or the transfer of a majority of the total interest in any
partnership tenant or subtenant, however accomplished, whether in a single
transaction or in a series of related or unrelated transactions, shall be
deemed an assignment of this Lease, or of such sublease, as the case may
be, except that the transfer of the outstanding capital stock of any
corporate tenant, or subtenant, shall be deemed not to include the sale of
such stock by persons or parties, through the "over-the-counter market" or
through any recognized stock exchange, other than those deemed "insiders"
within the meaning of the Securities Exchange Act of 1934 as amended
(provided, however, that any transfer of stock of Tenant or any affiliate
of Tenant by Morris Goldfarb to members of his immediate family for estate
planning purposes shall not be deemed to effect an assignment of the
Lease), (x) a takeover agreement shall be deemed a transfer of this Lease,
(y) any person or legal representative of Tenant, to whom Tenant's interest
under this Lease passes by operation of law, or otherwise, shall be bound
by the provisions of this
-4-
Article 10, and (z) a modification, amendment or extension of a sublease
shall be deemed a sublease.
(ii) The provisions of subparagraph (i) hereof shall not apply to
transactions with a corporation into or with which Tenant is merged or
consolidated or with an entity to which substantially all of Tenant's
assets are transferred or, if Tenant is a partnership, with a successor
partnership (provided such merger or transfer of assets is for a good
business purpose and not principally for the purpose of transferring the
leasehold estate created hereby, and provided further, that either the (x)
the assignee has a net worth at least equal to or in excess of the net
worth of Tenant immediately prior to such merger or transfer, or (y) such
assignee delivers a letter of credit, in the form annexed hereto as Exhibit
A, in the amount equal to the product of (A) twelve (12) and (B) the then
prevailing monthly fixed rent).
(iii) Any assignment or transfer, whether made with Landlord's consent as
required by subparagraph (i) or without Landlord's consent pursuant to
subparagraph (ii) hereof, shall be made only if, and shall not be effective
until, the assignee shall execute, acknowledge and deliver to Landlord a
recordable agreement (unless the assignment shall be a "deemed" assignment
by reason of a transfer of a majority interest in Tenant), in form and
substance reasonably satisfactory to Landlord, whereby the assignee shall
assume the obligations and performance of this Lease and agree to be
personally bound by and upon all of the covenants, agreements, terms,
provisions and conditions hereof on the part of Tenant to be performed or
observed and whereby the assignee shall agree that the provisions of
subparagraph (i) hereof shall, notwithstanding such an assignment or
transfer, continue to be binding upon it in the future. Tenant covenants
that, notwithstanding any assignment or transfer, whether or not in
violation of the provisions of this Lease, and notwithstanding the
acceptance of fixed annual rent by Landlord from an assignee or transferee
or any other party, Tenant shall remain fully and primarily liable for the
payment of the fixed annual rent and additional rent due and to become due
under this Lease and for the performance of all of the covenants,
agreements, terms, provisions and conditions of this Lease on the part of
Tenant to be performed or observed.
(iv) The liability of Tenant, and the due performance by Tenant of the
obligations on its part to be performed under this Lease, shall not be
discharged, released or impaired in any respect by an agreement or
-5-
stipulation made by Landlord or any grantee or assignee of Landlord, by way of
mortgage, or otherwise, extending the time of, or modifying any of the
obligations contained in this Lease, or by any waiver or failure of Landlord to
enforce any of the obligations on Tenant's part to be performed under this
Lease, and Tenant shall continue to be liable hereunder. If any such agreement
or modification operates to increase the obligations of a tenant under this
Lease, the liability under this subparagraph (iv) of the tenant named in the
Lease or any of its successors in interest, (unless such party shall have
expressly consented in writing to such agreement or modification) shall continue
to be no greater than if such agreement or modification had not been made. To
charge Tenant named in this Lease and its successors in interest after this
Lease shall be assigned, no demand or notice of any default to the named Tenant
shall be required. Tenant and each of its successors in interest hereby
expressly waive any such demand or notice.
(v) (A) Should Tenant determine, subject to the provisions of this Lease, to
assign this Lease, other than by an assignment contemplated by subparagraph (ii)
hereof, Tenant shall not less than forty-five (45) days prior to the effective
date of the contemplated assignment, deliver to Landlord a term sheet setting
forth the terms and the effective date of the contemplated assignment
transaction, the identity of the proposed assignee and information (including,
without limitation, current financial information regarding net worth, credit
and financial responsibility) with respect to the nature and character of the
proposed assignee's business, and Landlord shall then have the right to elect,
by notifying Tenant within thirty (30) days of such delivery, to (x) terminate
this Lease, as of such effective date as if it were the Expiration Date set
forth in this Lease or (y) accept an assignment of this Lease from Tenant, and
Tenant shall then promptly execute and deliver to Landlord, or Landlord's
designee if so elected by Landlord, in form reasonably satisfactory to
Landlord's counsel, an assignment which shall be effective as of such effective
date.
(B) In the event that this Lease shall be assigned to Landlord or
Landlord's designee or if the demised premises shall be sublet to Landlord or
Landlord's designee pursuant to this subparagraph (v), the provisions of any
such sublease or assignment and the obligations of Landlord and the rights of
Tenant with respect thereto shall not be binding upon or otherwise affect the
rights of any holder of a superior mortgage or of a lessor under a superior
lease unless such holder or
-6-
lessor shall elect by written notice to Tenant to succeed to the position of
Landlord or its designee, as the case may be, thereunder.
(C) Should Tenant determine subject to the provisions of this Lease, to
sublet the demised premises or any portion thereof, other than by a sublease
contemplated by subparagraph (ii) hereof, Tenant shall, not less than forty-five
(45) days prior to the effective date of the contemplated sublease, deliver to
Landlord, a term sheet setting forth the terms of the contemplated sublease
transaction, the effective date therefor, the identity of the proposed
subtenant, and information with respect to the nature and character of the
proposed subtenant's business, and Landlord shall then have the right to elect,
by notifying Tenant within thirty (30) days of such delivery, to (x) terminate
this Lease as to the portion of the demised premises affected by such subletting
or as to the entire demised premises, in the case of a subletting thereof, as of
such effective date, (y) in the case of a proposed subletting of the entire
demised premises, accept an assignment of this Lease to Landlord from Tenant,
and Tenant shall then promptly execute and deliver to Landlord, or Landlord's
designee if so elected by Landlord, in form reasonably satisfactory to
Landlord's and Tenant's counsel, an assignment which shall be effective as of
such effective date, (z) accept a sublease from Tenant of the portion of the
demised premises affected by such proposed subletting or the entire demised
premises in the case of a proposed subletting thereof, and Tenant shall then
promptly execute and deliver a sublease to Landlord, or Landlord's designee if
so elected by Landlord, for the term provided in the aforementioned term sheet,
commencing with such effective date, at (1) the rental terms reflected in such
term sheet or (2) the rental terms contained in this Lease on a per rentable
square foot basis, as elected by Landlord in such notice.
(D) If Landlord should elect to have Tenant execute and deliver a sublease
to Landlord or its designee pursuant to any of the provisions of this
subparagraph (v), said sublease shall be in a form reasonably satisfactory to
Landlord's counsel and on all the terms contained in this Lease, except that:
(1) The rental terms, if elected by Landlord, may be either as
provided in item (1) or item (2) of subparagraph (v)(C) hereof,
-7-
(2) Except as provided in this subparagraph (v)(D), the terms of the
sublease shall be on the same terms set forth in the term sheet delivered
to Landlord (as described in subparagraph (v)(C) hereof),
(3) The subtenant thereunder shall have the right to underlet the
subleased premises, in whole or in part, without Tenant's consent,
(4) The subtenant thereunder shall have the right to make, or cause to
be made, any changes, alterations, decorations, additions and improvements
that such subtenant may desire or authorize,
(5) Such sublease shall expressly negate any intention that any estate
created by or under such sublease be merged with any other estate held by
either of the parties thereto,
(6) Any consent required of Tenant, as lessor under that sublease,
shall be deemed granted if consent with respect thereto is granted by
Landlord,
(7) There shall be no limitation as to the use of the sublet premises
by the subtenant thereunder,
(8) Any failure of the subtenant thereunder to comply with the
provisions of said sublease, other than with respect to the payment of rent
to Tenant, shall not constitute a default thereunder or hereunder if
Landlord has consented to such non-compliance,
(9) Such sublease shall provide that Tenant's obligations with respect
to vacating the demised premises and removing any changes, alterations,
decorations, additions or improvements made in the subleased premises shall
be limited to those which accrued and related to such as were made prior to
the effective date of the sublease, and
(10) If subtenant shall fail to pay the rent under the sublease to
Tenant within ten (10) days after such installment of rent shall have
become due, then Tenant may give subtenant notice thereof and if subtenant
shall continue to fail to make any
-8-
such payment within thirty (30) days after the giving of such notice,
then Tenant shall be entitled to offset the amount not paid against
the next rent coming due under the Lease. Notwithstanding anything
herein to the contrary, such offset right shall not be binding upon
nor inure to any mortgagee or superior lessor.
(E) If pursuant to the exercise of any of Landlord's options pursuant
to this subparagraph (v) this Lease is terminated as to only a portion of
the demised premises, then the fixed annual rent payable hereunder and the
additional rent payable pursuant to the terms of this Lease shall be
adjusted in proportion to the portion of the demised premises affected by
such termination.
(vi) In the event that Landlord does not exercise any of the options
available to it pursuant to subparagraph (v) hereof, Landlord shall not
unreasonably withhold or delay its consent to an assignment of this Lease
or a subletting of the whole or any part of the demised premises for
substantially the remainder of the term of this Lease, provided:
(A) Tenant shall furnish Landlord with the name and business address
of the proposed subtenant or assignee and information with respect to the
nature and character of the proposed subtenant's or assignee's business, or
activities, such references and current financial information with respect
to net worth, credit and financial responsibility as are reasonably
satisfactory to Landlord, and an executed counterpart of the sublease or
assignment agreement;
(B) The proposed subtenant or assignee is a party whose financial net
worth, credit and financial responsibility is, considering the
responsibilities involved, reasonably satisfactory to Landlord;
(C) The nature and character of the proposed subtenant or assignee,
its business or activities and intended use of the demised premises is, in
Landlord's reasonable judgment, in keeping with the standards of the
Building and the floor or floors on which the demised premises are located;
(D) The proposed subtenant or assignee is not then an occupant of any
part of the Building or a party who dealt with Landlord or Landlord's agent
(directly or through a broker) with respect
-9-
to space in the Building during the six (6) months immediately preceding
Tenant's request for Landlord's consent;
(E) All costs incurred with respect to providing reasonably
appropriate means of ingress and egress from the sublet space or to
separate the sublet space from the remainder of the demised premises shall,
subject to the provisions of this Lease with respect to alterations,
installations, additions or improvements, be borne by Tenant;
(F) Each sublease shall specifically state that (x) it is subject to
all of the applicable terms, covenants, agreements, provisions, and
conditions of this Lease, (y) the subtenant will not have the right to a
further sublease thereunder (except the subtenant of an entire floor of the
demised premises shall have all the rights to assign and sublease afforded
to the named Tenant herein (i.e., G-lll Leather Fashions, Inc.); provided,
notwithstanding the provisions of subparagraph (vii)(B) of this Article 10,
such subtenant shall pay to Landlord any and all rents, additional charge
or other consideration payable under such sub-sublease or otherwise to
subtenant by the sub-subtenant which is in excess of the fixed annual rent
and additional rent accruing during the term of such sub-sublease in
respect of the sub-subleased space (at the rate per square foot payable by
subtenant thereunder) pursuant to the terms of this Lease (including, but
not limited to, sums paid for the sale or rental of subtenant's fixtures,
leasehold improvements, equipment, furniture or other personal property,
less, in the case of the sale thereof, the then net unamortized or
undepreciated cost thereof determined on the basis of subtenant's federal
income tax returns), and less the reasonable costs of effecting such
transaction, including, without limitation, brokerage commissions, legal
fees and build out costs, or to allow the demised premises to be used by
others, without the consent of Landlord in each instance, and (z) a consent
by Landlord thereto shall not be deemed or construed to modify, amend or
affect the terms and provisions of this Lease, or Tenant's obligations
hereunder, which shall continue to apply to the premises involved, and the
occupants thereof, as if the sublease had not been made;
(G) Tenant shall, together with requesting Landlord's consent
hereunder, have paid Landlord any reasonable out-of-pocket costs incurred
by Landlord to review the requested consent including any attorneys fees
incurred by Landlord;
-10-
(H) The proposed subtenant or assignee is not (w) a retail branch of a
bank trust company, safe deposit business, savings and loan association or
loan company; (x) an employment or recruitment agency; (y) a school,
college, university or educational institution, whether or not for profit;
(z) a government or any subdivision or agency thereof;
(I) In the case of a subletting of a portion of the demised premises,
the layout of the portion so sublet shall be commercially reasonable and
suitable for normal renting purposes and such subletting will not result in
more than two (2) occupants (including Tenant) occupying the demised
premises; and
(J) Tenant shall not have advertised or listed with any brokers the
proposed assignment or subletting at a rental rate less than the rental
rates then being charged under leases being entered into by Landlord for
comparable space in the Building.
(vii) If Tenant shall assign this Lease or sublease all or any part of the
demised premises, Tenant shall pay to Landlord, as additional rent:
(A) in the case of an assignment, an amount equal to one- quarter
(1/4) of all sums and other considerations paid to Tenant by the assignee
for or by reason of such assignment or otherwise (including, but not
limited to, sums paid for the sale of Tenant's fixtures, leasehold
improvements, equipment, furniture, furnishings or other personal property,
less, in the case of a sale thereof, the then net unamortized or
undepreciated cost thereof determined on the basis of Tenant's federal
income tax returns); and
(B) in the case of a sublease, one-quarter (1/4) of the amount equal
to any and all rents, additional charge or other consideration payable
under the sublease or otherwise to Tenant by the subtenant which is in
excess of the fixed annual rent and additional rent accruing during the
term of the sublease in respect of the subleased space (at the rate per
square foot payable by Tenant hereunder) pursuant to the terms hereof
(including, but not limited to, sums paid for the sale or rental of
Tenant's fixtures, leasehold improvements, equipment, furniture or other
personal property, less, in the case of the sale thereof, the then net
unamortized or undepreciated cost thereof determined on the basis of
Tenant's federal income tax returns).
-11-
The sums payable under this subparagraph (vii) shall be paid to Landlord as
and when paid by the subtenant or assignee, as the case may be, to Tenant.
(viii) If Tenant defaults in the payment of any rent, Landlord is
authorized to collect any rents due or accruing from any assignee,
subtenant or other occupant of the demised premises and to apply the net
amounts collected to the fixed annual rent and additional rent reserved
herein. The receipt by Landlord of any amounts from an assignee or
subtenant, or other occupant of any part of the demised premises shall not
be deemed or construed as releasing Tenant from Tenant's obligations
hereunder or the acceptance of that party as a direct tenant."
(d) The Twelfth Article of the Lease is hereby supplemented with the
following:
"(c) Notwithstanding anything to the contrary, Landlord shall have the
right and privilege to serve at any time up to six (6) months prior to the
expiration of the term of this Lease, a notice upon Tenant that any
'nonstandard alterations' shall be removed and, in the event of service of
such notice, Tenant will, at Tenant's cost and expense, remove the same in
accordance with such request and repair any damage to the demised premises
caused by such removal; provided that Landlord shall have advised Tenant at
the time it consented to any such nonstandard alteration that Landlord may
require its removal at the end of the Lease term, if and to the extent that
Tenant shall have requested in writing such advice from Landlord when it
requested Landlord's consent to such alteration. For the purposes of this
Article 12, a 'nonstandard alteration' shall mean auditoriums or similar
type special use areas, vaults, atriums, kitchen equipment and
installations, internal stairways, slab reinforcements, raised floors or
other alterations which impede the installation of duct work or other
normal installations above the finished ceiling or which are not suitable
for normal office occupancy or which would be unusually difficult or costly
to remove in comparison to usual alterations required for general office
purposes. Notwithstanding the foregoing, it is understood and agreed by the
parties hereto that all improvements and other alterations to the demised
premises made by or on behalf of Tenant prior to July 1, 2000, shall be
deemed to be standard alterations which Landlord may not require Tenant to
remove."
(e) The Twenty-Second Article of the Lease is hereby deleted and the
following is substituted therefor:
-12-
(i) Tenant agrees that Landlord shall furnish electricity to
Tenant on a 'submetering' basis. Landlord shall install any submeters reasonably
required, in Landlord's judgment, in the demised premises for the purposes of
this Article, at Tenant's sole cost and expense. Electricity and electric
service, as used herein, shall mean any element affecting the generation,
transmission, and/or distribution or redistribution of electricity, including,
but not limited to, services which facilitate the distribution of service.
(ii) Tenant covenants and agrees to purchase electricity from
Landlord or Landlord's designated agent at charges, terms and rates, including,
without limitation, fuel adjustments and taxes, equal to those specified in the
Con Edison SC#4-I rate schedule effective on the date Landlord first provides
electricity to the demised premises on a submetering basis (the "effective"
date), or any successor rate schedule or service classification, plus five
percent (5%) for transmission line loss and other redistribution costs. Where
more than one (1) meter measures the service of Tenant in the Building, then the
service registered by each meter shall be aggregated and billed at the
applicable rate as if there were only one (1) sub-meter measuring Tenant's
aggregate use in the entire demised premises. Bills therefore shall be rendered
at such times as Landlord may elect and the amount, as computed from a meter,
shall be deemed to be, and be paid as, Additional Charges. If any tax is imposed
by any Federal, State or Municipal authority upon Landlord's receipts from the
sale or resale of electrical energy to Tenant hereunder, Tenant covenants and
agrees that where permitted by law, Tenant's pro-rata share of such taxes shall
be included in the amount of Additional Charges to be paid by Tenant to Landlord
hereunder.
(iii) If all or part of the submetering additional rent payable
in accordance with this Article 22 becomes uncollectible or reduced or refunded
by virtue of any law, order or regulation, the parties agree that, at Landlord's
option, in lieu of submetering Additional Charges, and in consideration of
Tenant's use of the Building's electrical distribution system and receipt of
redistributed electricity and payment by Landlord of consultant's fees and other
redistribution costs, the fixed annual rent to be paid under this Lease shall be
increased by an "alternative charge" which shall be the average per rentable
square foot rate payable by Tenant for electricity during the prior twelve (12)
month period pursuant to this Article.
(iv) Landlord shall not be liable for any loss or damage or
expense which Tenant may sustain or incur if either the quantity or
-13-
character of electric service is changed or is no longer available or suitable
for Tenant's requirements. Tenant covenants and agrees that at all times its use
of electric current shall never exceed the capacity of existing feeders to the
Building or wiring installation. Any riser or risers to supply Tenant's
electrical requirements, upon written request of Tenant, will be installed by
Landlord, at the sole cost and expense of Tenant, if, in Landlord's reasonable
judgment, the same are reasonably necessary and will not cause permanent damage
or injury to the Building or demised premises or cause or create a dangerous or
hazardous condition or entail excessive or unreasonable alterations, repairs or
expenses or otherwise interfere with or disturb other tenants or occupants of
the Building except to a de minimis extent. In addition to the installation of
such riser or risers, Landlord will also, at the sole cost and expense of
Tenant, install all other equipment proper and necessary in connection therewith
subject to the aforesaid terms and conditions. The parties acknowledge that they
understand that it is anticipated that electric rates, charges, etc., may be
changed by virtue of time-of-day rates or other methods of billing, electricity
purchases and the redistribution thereof, and that the references in the
foregoing paragraphs to changes in methods of or rules on billing are intended
to include any such changes. Anything hereinabove to the contrary
notwithstanding, in no event is the submetering, additional rent or any
"alternative charge" to be less than an amount equal to the total of Landlord's
payment to public utilities and/or other providers for the electricity consumed
by Tenant (and any taxes thereon or on redistribution of same) plus five percent
(5%) for transmission line loss and other redistribution costs. Landlord
reserves the right to terminate the furnishing of electricity upon sixty (60)
days' prior written notice to Tenant; provided Landlord terminates the
furnishing of electricity to at least fifty percent (50%) of the tenants of the
Building (not including those retail tenants on the ground floor of the
Building) to whom Landlord is furnishing electricity on a submetered basis, in
which event the Tenant may make application directly to the public utility
and/or other providers for the Tenant's entire separate supply of electric
current and Landlord shall permit its wires and conduits, to the extent
available and safely capable, to be used for such purpose, but only to the
extent of Tenant's then authorized load. Any meters, risers, or other equipment
or connections reasonably necessary to furnish electricity on a submetering
basis or to enable Tenant to obtain electric current directly from such utility
and/or other providers shall be installed at Tenant's sole cost and expense.
Only rigid conduit or electrical metal tubing (EMT) will be allowed. Landlord,
upon the expiration of the aforesaid sixty (60) days' prior written notice
period may discontinue furnishing the electric current but this Lease shall
otherwise remain in full force and effect.
-14-
(v) Tenant's use of electric energy in the demised premises shall
not at any time exceed the capacity of any of the electrical conductors and
equipment in or otherwise serving the demised premises. In order to insure that
such capacity is not exceeded and to avert possible adverse effect upon the
Building's distribution of electricity via the Building's electric system,
Tenant shall not, without Landlord's prior consent in each instance (which
consent shall not be unreasonably withheld or delayed), connect any fixtures,
appliances or equipment (other than normal business machines and personal
computers, which do not materially increase Tenant's electrical consumption) to
the Building's electric system or make any alterations or additions to the
electric system of the demised premises existing on the Extended Term
Commencement Date. Landlord shall continue to make electrical energy available
to the demised premises in accordance with current practice.
(vi) (1) Upon Tenant's request therefor, Landlord shall provide
Tenant with utility invoices and other reasonable documentation supporting its
computation of Additional Charges hereunder.
(2) At Landlord's option, Tenant shall purchase from
Landlord or Landlord's agent all lighting tubes, lamps, bulbs and ballasts used
in the demised premises and Tenant shall pay Landlord's reasonable charges for
providing and installing same, on demand, as additional rent."
(f) Tenant shall simultaneously upon execution of the First Amendment
of Lease dated as of July 1, 2000 (the "Amendment") deliver to Landlord
additional cash security in the amount of Fourteen Thousand Seven Hundred
Fifty-Nine and 42/100 Dollars ($14,759.42). With Tenant's delivery of this
additional cash security, the amount of security provided for in the
Thirty-Eighth Article of the Lease is hereby amended to be the aggregate amount
of Twenty-Eight Thousand Two Hundred Ninety-Five and 42/100 Dollars
($28,295.42).
(g) The Thirty-Ninth Article of the Lease is hereby amended as
follows:
(i) All references to "five (5) days" in subparagraph (a) thereof
are hereby deleted and "fifteen (15) days" is substituted therefor.
-15-
(ii) Subparagraph (b) thereof is hereby amended by deleting
proviso (1) therefrom and substituting the following therefor:
"(1) if Tenant shall make default in the payment of the rent
reserved herein for a period of five (5) days after receipt of
written notice from Landlord that same is past due or default in
the payment of additional rent due herein for a period of fifteen
(15) days after receipt of written notice from Landlord that same
is past due..."
(h) The Forty-Eighth Article of the Lease is hereby amended such that
notices sent by Tenant to Landlord shall be sent as set forth in the Lease to
c/o Newmark & Company Real Estate, Inc., 125 Park Avenue, New York, New York
10017. A copy of any default or any other notices shall be sent to Arent Fox
Kintner Plotkin & Kahn, PLLC, 1675 Broadway, New York, New York 10019,
Attention: Jill Hayman, Esq. The Forty-Eighth Article of the Lease is hereby
further amended such that a copy of notices sent by Landlord to Tenant shall
also be sent to Fulbright & Jaworski L.L.P., 666 Fifth Avenue, New York, New
York 10103, Attention: Douglas J. Danzig, Esq.
(i) The Fifty-Seventh Article of the Lease is hereby deleted.
(j) The term "base tax year" as set forth in the Fifty-Eighth Article
of the Lease is hereby amended to mean "the New York City real estate tax year
commencing July 1, 2000 and ending June 30, 2001".
(k) The Sixty-Fifth Article of the Lease is hereby deleted and the
following is substituted therefor:
"SIXTY-FIFTH: - Within fifteen (15) days after the Amendment has been fully
executed, Landlord shall pay Tenant, as a contribution to the cost of
Tenant's work to prepare the demised premises for Tenant's occupancy, the
amount of Fifty-Three Thousand One Hundred Twenty and 00/100 ($53,120.00)
Dollars. On February 1, 2006, Landlord shall pay Tenant, as a second (2nd)
contribution to the cost of Tenant's work to prepare the demised premises
for Tenant's occupancy, the amount of One Hundred Fifty-Nine Thousand Three
Hundred Sixty and 00/100 ($159,360.00) Dollars."
-16-
(l) The Sixty-Seventh Article of the Lease is hereby deleted and the
following is substituted therefor:
"SIXTY-SEVENTH: - (i) If Tenant shall fail to pay any installment of fixed
annual rent for more than five (5) days after the same becomes due and
payable or any amount of additional rent for more than fifteen (15) days
after the same becomes due and payable (collectively, the "Default
Periods"), Tenant shall pay Landlord a late charge of ten cents ($0.10) for
each dollar of such fixed annual rent or additional rent as shall not have
been paid to Landlord within said respective Default Periods. Such late
charge shall be without prejudice to any of Landlord's rights and remedies
hereunder or at law for nonpayment of rent, shall be in addition thereto
and shall be deemed to be additional rent. Notwithstanding anything to the
contrary contained herein, Tenant shall be permitted to pay an installment
of fixed annual rent late once per calendar year without incurring a late
charge, provided such payment is received no later than the tenth (10th)
day of the month in which such payment is due. Further, notwithstanding
anything to the contrary contained herein, Landlord shall waive the late
charge for one (1) late payment of additional rent by Tenant per calendar
year, provided such payment is received no later than thirty (30) days
after the date such payment was due.
(ii) If in accordance with the Thirty-Ninth Article of the Lease, Tenant
shall be in default in the payment of (A) any installment of fixed annual
rent or any amount of additional rent or (B) any other sum of money which
shall become due and payable by Tenant to Landlord pursuant to the terms of
this Lease or by reason of Tenant's occupancy of the demised premises, in
addition to (and not in lieu of) the late charge provided for in
subparagraph (i) above, Tenant shall pay interest thereon at a rate equal
to the lesser of four percent (4%) above the prime rate per annum from time
to time set forth in The Wall Street Journal, calculated on the basis of
the actual days elapsed, based on a 360-day year, or the minimum rate of
interest allowed by applicable law(s), if any, then prevailing, from the
date on which such installment or payment is due to the date of payment
thereof, and such interest shall be deemed to be additional rent.
(iii) Except as required by statute and under the laws, nothing contained
in Article 39 or in this Article 67 shall be deemed to require Landlord to
give the notices therein or herein (if any) provided for prior to the
commencement of a summary proceeding for nonpayment of rent or a plenary
action for the recovery of rent on account of any
-17-
default in the payment of the same, it being intended that such notices are
for the sole purpose of creating a conditional limitation hereunder
pursuant to which this Lease shall terminate and if Tenant thereafter
remains in possession or occupancy, it shall become a holdover tenant."
(m) The Sixty-Eighth Article of the Lease is hereby deleted and the
following is substituted therefor:
"SIXTY-EIGHTH: - (i) This Lease shall be governed in all respects by the
laws of the State of New York.
(ii) If, in connection with obtaining financing for the Building, a bank,
insurance company or other lending institution shall request reasonable
modifications to this Lease as a condition to such financing, Tenant will
not unreasonably withhold, delay or defer its consent thereto, provided
that such modifications do not increase the obligations of Tenant
hereunder, decrease the obligations of Landlord hereunder, except to a de
minimis extent, or otherwise materially or adversely affect Tenant's
leasehold interest hereby created.
(iii) Tenant shall not be entitled to exercise any right of termination or
other option granted to it by this Lease (if any) at any time when Tenant
is in monetary default, after applicable notice, grace and/or cure periods,
in the performance or observance of any of the covenants, terms, provisions
or conditions on its part to be performed or observed under this Lease.
(iv) Tenant shall not occupy any space in the Building (by assignment,
sublease or otherwise) other than the demised premises or other premises
leased to Tenant directly by Landlord (except if the named Tenant herein is
subsequently purchased by a third party which leases space in the
Building), except with the prior written consent of Landlord in each
instance.
(v) Tenant acknowledges that it has no rights to any development rights,
"air rights" or comparable rights appurtenant to the land or building, and
consents, without further consideration, to any utilization of such rights
by Landlord and agrees to promptly execute and deliver any instruments
which may be requested by Landlord, including instruments which may be
reasonably requested by Landlord, including instruments merging zoning
lots, evidencing acknowledgment and
-18-
consent. The provisions of this paragraph shall be deemed to be and shall
be construed as an express waiver by Tenant of any interest Tenant may have
as a "party in interest" (as such quoted term is defined in Section 12
Zoning Lot of the Zoning Resolution of the City of New York) in the
building or the land.
(vi) Any and all payments and charges to be paid by Tenant hereunder other
than the annual rent payable pursuant to this Lease shall be additional
rent hereunder for non-payment of which Landlord shall have all of the
remedies provided herein or at law.
(vii) If this Lease be a renewal of an existing lease between the parties
or their predecessors in interest, then any obligation of Tenant for the
payment of rent or additional rent or the performance of any obligation
under such existing lease which accrues prior to the expiration thereof
shall constitute an obligation under this Lease, except as modified by the
Amendment (as that term is defined in Article 38 of this Lease), for
non-payment or non-performance for which Landlord shall have all of the
remedies provided herein."
(n) The Sixty-Ninth Article of the Lease is hereby deleted and the
following is substituted therefor:
"SIXTY-NINTH: - As a material inducement to Landlord for entering into this
Lease, Tenant covenants and agrees that except for the inside surfaces of
all walls, windows and doors bounding the demised premises, all of the
remainder of the Building is exclusively reserved to Landlord, subject to
Tenant's right to use the common areas of the Building in accordance with
the applicable provisions of this Lease (including, without limitation, the
lobby, elevators and core bathrooms, as opposed to private bathrooms, on
the thirty-third (33rd) floor of the Building). Notwithstanding anything to
the contrary contained herein, Tenant shall have the right to use in
accordance with the Lease, the electric and telephone closets and so-called
"slop" sinks on the thirty-third (33rd) floor of the Building."
(o) The second sentence of the Twenty-First Article of the Lease shall
be amended to read as follows:
-19-
"Landlord or Landlord's agents shall have the right to enter the demised
premises at reasonable times after notice (which may be oral) to Tenant to
examine the same..."
4. Each party hereto covenants, warrants and represents to the other party
that it has had no dealings, conversations or negotiations with any broker other
than Newmark & Company Real Estate, Inc., concerning the execution and delivery
of this Amendment. Each party hereto agrees to defend, indemnify and hold
harmless the other party against and from any claims for any brokerage
commissions and all costs, expenses and liabilities in connection therewith,
including, without limitation, reasonable attorneys' fees and disbursements,
arising out of its respective representations and warranties contained in this
Paragraph 4 being untrue. Landlord shall pay any brokerage fees which may be due
to Newmark & Company Real Estate, Inc. in connection with this Amendment
pursuant to a separate agreement.
5. Except as expressly set forth in this Amendment, the terms and
conditions of the Lease shall continue in full force and effect without any
change or modification and shall apply for the balance of the term of the Lease
as hereby extended. In the event of a conflict between the terms of the Lease
and the terms of this Amendment, the terms of this Amendment shall govern.
6. This Amendment shall not be altered, amended, changed, waived,
terminated or otherwise modified in any respect or particular, and no consent or
approval required pursuant to this Amendment shall be effective, unless the same
shall be in writing and signed by or on behalf of the party to be charged.
7. This Amendment shall be binding upon and shall inure to the benefit of
the parties hereto and to their respective heirs, executors, administrators,
successors and permitted assigns.
8. All prior statements, understandings, representations and agreements
between the parties, oral or written, are superseded by and merged in this
Amendment, which alone fully and completely expresses the agreement between them
in connection with this transaction and which is entered into after full
investigation, neither party relying upon any statement, understanding,
representation or agreement made by the other not embodied in this Amendment
relating to the demised premises. Landlord acknowledges that Tenant occupies
other space in the Building pursuant to separate agreements between Landlord and
Tenant which may be renewed and amended from time to time.
9. No failure or delay of either party in the exercise of any right or
remedy given to such party hereunder or the waiver by any party of any condition
-20-
hereunder for its benefit (unless the time specified herein for exercise of such
right or remedy has expired) shall constitute a waiver of any other or further
right or remedy nor shall any single or partial exercise of any right or remedy
preclude other or further exercise thereof or any other right or remedy. No
waiver by either party of any breach hereunder or failure or refusal by the
other party to comply with its obligations shall be deemed a waiver of any other
or subsequent breach, failure or refusal to so comply.
10. This Amendment shall be interpreted and enforced in accordance with the
laws of the state in which the demised premises are located without reference to
principles of conflicts of laws.
11. If any provision of this Amendment shall be unenforceable or invalid,
the same shall not affect the remaining provisions of this Amendment and to this
end the provisions of this Amendment are intended to be and shall be severable.
Notwithstanding the foregoing sentence, if (i) any provision of this Amendment
is finally determined by a court of competent jurisdiction to be unenforceable
or invalid in whole or in part, (ii) the opportunity for all appeals of such
determination have expired, and (iii) such unenforceability or invalidity alters
the substance of this Amendment (taken as a whole) so as to deny either party,
in a material way, the realization of the intended benefit of its bargain, such
party may terminate this Amendment within thirty (30) days after the final
determination by notice to the other. If such party so elects to terminate this
Amendment, then this Amendment shall be terminated and neither party shall have
any further rights, obligations or liabilities hereunder, except those
obligations which expressly survive the termination of this Amendment.
12. LANDLORD AND TENANT HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY,
UNCONDITIONALLY AND IRREVOCABLY WAIVE ANY RIGHT EACH MAY HAVE TO TRIAL BY JURY
IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER ARISING IN TORT OR CONTRACT)
BROUGHT BY EITHER AGAINST THE OTHER ON ANY MATTER ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS AMENDMENT OR ANY OTHER DOCUMENT EXECUTED AND DELIVERED BY
EITHER PARTY IN CONNECTION HEREWITH (INCLUDING ANY ACTION TO RESCIND OR CANCEL
THIS AMENDMENT ON THE GROUNDS THAT THIS AMENDMENT WAS FRAUDULENTLY INDUCED OR IS
OTHERWISE VOID OR VOIDABLE).
13. This Amendment may be executed in any number of counterparts. It is not
necessary that all parties sign all or any one of the counterparts, but each
party must sign at least one counterpart for this Amendment to be effective.
-21-
14. This Amendment shall not be binding upon either party unless and until
it is fully executed and delivered to both parties.
* * * * *
[The remainder of this page is left intentionally blank; the
signature page follows]
-22-
IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of
the date and year first above written.
LANDLORD:
500-512 SEVENTH AVENUE LIMITED PARTNERSHIP
By: 500-512 ArCap LLC, its General Partner
By: Archon Capital, L.P,, its sole Member
By: WH MezzCo GP, L.L.C., its General
Partner
By: /s/ Alan S. Kava
----------------------------------
Name: Alan S. Kava
Title Vice President
By: GS MezzCo GP, L.L.C., its General
Partner
By:
----------------------------------
Name:
Title:
TENANT:
G-LLL LEATHER FASHIONS, INC.
By: /s/ Wayne S. Miller
--------------------------------
Name: WAYNE S. MILLER
Title: CFO
-23-
G-III APPAREL GROUP, LTD.
1989 STOCK OPTION PLAN
1. Purpose. The purpose of this stock option plan (the "Plan") is to enable
G-III Apparel Group, Ltd. (the "Company") and its stockholders to secure the
benefits of common stock ownership by key personnel of the Company and its
subsidiaries. The Board of Directors of the Company (the "Board") believes that
the granting of options under the Plan will foster the Company's ability to
attract, retain and motivate those individuals who will be largely responsible
for the continued profitability and long-term future growth of the Company.
2. Stock Subject to the Plan. The Company may issue and sell a total of
1,130,000 shares of its common stock, $.01 par value (the "Common Stock"),
pursuant to the Plan. Such shares may be either authorized and unissued or held
by the Company in its treasury. The maximum option grant which may be made in
any calendar year to any employee shall not cover more than 150,000 shares. New
options may be granted under the Plan with respect to shares of Common Stock
which are covered by the unexercised portion of an option which has terminated
or expired.
3. Administration. The Plan shall be administered by a committee (the
"Committee") consisting of at least two directors appointed by and serving at
the pleasure of the Board.
To the extent required by the applicable provisions of Rule 16b-3 issued by the
Securities and Exchange Commission under the Securities Exchange Act of 1934, no
member of the Committee shall have been eligible to receive shall have
received an option under the Plan within one year before his or her appointment
or such other period as may be prescribed by said Rule. Subject to the
provisions of the Plan, the Committee, acting in its sole and absolute
discretion, shall have full power and authority to grant options under the Plan,
to interpret the provisions of the Plan and option agreements made under the
Plan, to supervise the administration of the Plan, and to take such other action
as may be necessary or desirable in order to carry out the provisions of the
Plan. A majority of the members of the Committee shall constitute a quorum. The
Committee may act by the vote of a majority of its members present at a meeting
at which there is a quorum or by unanimous written consent. The decision of the
Committee as to any disputed question, including questions of construction,
interpretation and administration, shall be final and conclusive on all persons.
The Committee shall keep a record of its proceedings and acts and shall keep or
caused to be kept such books and records as may be necessary in connection with
the proper administration of the Plan.
4. Grant of Options. Options may be granted under the Plan to present or
future key employees of the Company or a subsidiary of the Company (a
"Subsidiary") within the meaning of
- 2 -
Section 425(f) of the Internal Revenue Code of 1986 (the "Code"), and to
consultants or other independent contractors who perform services for the
Company or a Subsidiary, but not to directors who perform services for the
Company solely in their capacities as directors. Subject to the provisions of
the Plan, the Committee shall from time to time select the key personnel of the
Company and its Subsidiaries to whom options under the Plan will be granted, and
shall fix the number of shares covered by each such option and establish the
terms and conditions thereof (including, without limitation, exercise price and
restrictions on exercisability of the option or on the shares of Common Stock
issued upon exercise thereof and whether or not the option is to be treated as
an incentive stock option within the meaning of Section 422 of the Code (an
"Incentive Stock Option")).
5. Terms and Conditions of Options. Each option granted under the Plan
shall be evidenced by a written agreement in a form approved by the Committee.
Each such option shall be subject to the terms and conditions set forth in this
paragraph and such additional terms and conditions not inconsistent with the
Plan (and, in the case of an Incentive Stock Option, not inconsistent with the
provisions of the Code applicable thereto) as the Committee deems appropriate.
(a) Option Price. In the case of an option which is not treated as an
Incentive Stock Option, the purchase price per share shall not be less than
the par value of a share of Common Stock on the date the option is granted;
and, in the case of an Incentive Stock Option, the purchase price per
- 3 -
share shall not be less than 100% of the fair market value of a share of
Common Stock on the date the option is granted (110% in the case of an
optionee who, at the time the option is granted, owns stock possessing more
than 10% of the total combined voting power of all classes of stock of the
Company or a Subsidiary (a "ten percent shareholder")). For purposes
hereof, the fair market value of a share of Common Stock on any date shall
be equal to the closing sale price per share as published by a national
securities exchange on which shares of the Common Stock are traded on such
date or, if there is no sale of Common Stock on such date, the average of
the bid and asked prices on such exchange at the closing of trading on such
date or, if shares of the Common Stock are not listed on a national
securities exchange on such date, the average of the bid and asked prices
in the over the counter market at the close of trading on such date, or if
the Common Stock is not traded on a national securities exchange or the
over the counter market, the fair market value of a share of the Common
Stock on such date as determined in good faith by the Committee.
(b) Option Period. The period during which an option may be exercised shall
be fixed by the Committee and shall not exceed 10 years from the date the
option is granted (5 years in the case of an Incentive Stock Option granted
to a "ten percent shareholder").
- 4 -
(c) Exercise of Options. No option shall be exercisable unless the person
to whom the option was granted remains in the continuous employ or service
of the Company or a Subsidiary for at least six months (or for such other
period as the Committee may designate) from the date the option is granted.
Subject to earlier termination of the option as provided herein, unless the
Committee determines otherwise, the option will become exercisable in
accordance with the following schedule based upon the number of full years
of the optionee's continuous employment or service with the Company or a
Subsidiary following the date of grant:
Full Incremental Cumulative
Years of Continuous Percentage of Percentage of
Employment/ Option Option
Service Exercisable Exercisable
- ------------------- ------------- -------------
Less than 1 0% 0%
1 20% 20%
2 20% 40%
3 20% 60%
4 20% 80%
5 or more 20% 100%
All or part of the exercisable portion of an option may be exercised at any
time during the option period, except that, without the consent of the
Committee, no partial exercise of an option shall be for less than 100
shares. An option may be exercised by transmitting to the Company (1) a
written notice specifying the number of shares to be purchased, and (2)
payment in full of the purchase price (or, if applicable, delivery of a
secured obligation therefor),
- 5 -
together with the amount, if any, deemed necessary by the Committee to
enable the Company to satisfy its income tax withholding obligations with
respect to such exercise (unless other arrangements acceptable to the
Committee are made with respect to the satisfaction of such withholding
obligations).
(d) Payment of Option Price. The purchase price of shares of Common Stock
acquired pursuant to the exercise of an option granted under the Plan shall
be payable in cash and/or such other form of payment as may be permitted
under the option agreement, including, without limitation, previously-owned
shares of Common Stock. The Committee may permit the payment of all or a
portion of the purchase price in installments (together with interest) over
a period of not more than 5 years.
(e) Rights as a Stockholder. No shares of Common Stock shall be issued in
respect of the exercise of an option granted under the Plan until full
payment therefore has been made (and/or provided for where all or a portion
of the purchase price is being paid in installments). The holder of an
option shall have no rights as a stockholder with respect to any shares
covered by an option until the date a stock certificate for such shares is
issued to him or her. Except as otherwise provided herein, no adjustments
shall be
- 6 -
made for dividends or distributions of other rights for which the record
date is prior to the date such stock certificate is issued.
(f) Transferability of Options. No option shall be assignable or
transferable except upon the optionee's death to a beneficiary designated
by the optionee in accordance with procedures established by the Committee
or, if no designated beneficiary shall survive the optionee, pursuant to
the optionee's will or by the laws of descent and distribution. During an
optionee's lifetime, options may be exercised only by the optionee or the
optionee's guardian or legal representative.
(g) Termination of Employment or Other Service. If an optionee ceases to be
employed by or to perform services for the Company and any Subsidiary for
any reason other than death or disability (defined below), then each
outstanding option granted to him or her under the Plan shall terminate on
the date three months after the date of such termination of employment or
service (or, if earlier, the date specified in the option agreement). If an
optionee's employment or service is terminated by reason of the optionee's
death or disability (or if the optionee's employment or service is
terminated by reason of his or her disability and the optionee dies within
one year after such termination of employment or service), then each
outstanding option granted to the optionee under the Plan shall terminate
on the date one year after the date of such termination of employment or
service (or one year after the later death of a disabled
- 7 -
optionee) or, if earlier, the date specified in the option agreement. For
purposes hereof, the term "disability" shall mean the inability of an
optionee to perform the customary duties of his or her employment or other
service for the Company or a Subsidiary by reason of a physical or mental
incapacity which is expected to result in death or be of indefinite
duration.
(h) Incentive Stock Options. In the case of an Incentive Stock Option
granted under the Plan, at the time the option is granted, the aggregate
fair market value (determined at the time of grant) of the shares of Common
Stock with respect to which Incentive Stock Options are exercisable for the
first time by the optionee during any calendar year shall not exceed
$100,000.
(i) Changes in Capital Stock. The aggregate number and class of shares for
which options may be granted under the Plan, the maximum number of shares
for which options may be granted to any employee in any calendar year, the
number and class of shares covered by each outstanding option and the
exercise price per share shall be adjusted proportionately or as otherwise
deemed appropriate by the Board to reflect any increase or decrease in the
number of issued shares of Common Stock resulting from a split-up or
consolidation of shares or any like capital adjustment, or the payment of
any stock dividend, and/or to reflect a change in the character or class of
shares covered by the plan arising from a readjustment or recapitalization
of the Company's capital stock. In the case of a merger, sale of assets or
similar transaction which results in a replacement of the Company's shares
of Common Stock with stock of another corporation,
- 8 -
the Company will make a reasonable effort, but shall not be required, to
replace any outstanding options with comparable options to purchase the
stock of such other corporation, or will provide for immediate
exercisability of all outstanding options, with all options not being
exercised within the time period specified by the Board being terminated.
(j) Other Provisions. The Committee may impose such other conditions with
respect to the exercise of options, including, without limitation, any
conditions relating to the application of federal or state securities laws,
as it may deem necessary or advisable.
6. Amendment and Termination of the Plan. The Board may amend or terminate
the Plan. Except as otherwise provided in the Plan with respect to equity
changes, any amendment which would increase the aggregate number of shares of
Common Stock as to which options may be granted under the Plan, materially
increase the benefits under the Plan, or modify the class of persons eligible to
receive options under the Plan shall be subject to the approval of the holders
of a majority of the Common Stock issued and outstanding. No amendment or
termination may adversely affect any outstanding option without the written
consent of the optionee.
7. No Rights Conferred. Nothing contained herein will be deemed to give any
individual any right to receive an option
- 9 -
under the Plan or to be retained in the employ or service of the Company or any
Subsidiary.
8. Governing Law. The Plan and each option agreement shall be governed by
the laws of the State of Delaware.
9. Decisions of Board or Committee to be Final. Any decision or
determination made by the Board pursuant to the provisions hereof and, except to
the extent rights or powers under the plan are reserved specifically to the
discretion of the Board, all decisions and determinations of the Committee shall
be final and binding on all persons.
10. Term of the Plan. The Plan shall be effective as of October 17, 1989,
the date on which it was adopted by the Board, subject to the approval of the
stockholders of the Company, which approval was granted on November 1, 1989. The
Plan will terminate on October 16, 1999, unless sooner terminated by the Board.
The rights of optionees under options outstanding at the time of the termination
of the Plan shall not be affected solely by reason of the termination and shall
continue in accordance with the terms of the option (as then in effect or
thereafter amended).
- 10 -
[G-III LOGO]
APPAREL GROUP, LTD.
EXHIBIT A
December 2, 1998
Mr. Aron Goldfarb
200 East 65th Street
New York, New York 10021
Dear Mr. Goldfarb:
This letter will confirm the following agreement between G-III Apparel Group,
Ltd. (the "Company") and you.
1) You will continue to be a Consultant to the Company.
2) In consideration of your consulting to the Company, you will continue to be
paid $1,000 per month.
3) The Company shall continue to provide medical insurance to you and your
wife Esther Goldfarb.
4) The Company shall continue to provide you with an automobile or shall
reimburse you for the cost thereof.
5) The Company shall continue to furnish you with office space, secretarial
support and other office services for so long as you shall desire.
6) If you shall pre-decease your wife, this agreement and all benefits
hereunder shall terminate, provided, however, that the Company shall
continue to provide the medical insurance referred to in Section 3 to your
wife.
If the foregoing accurately sets forth our understanding, please execute both
copies of this letter and return one executed copy to the undersigned.
Very truly yours,
G-III Apparel Group, Ltd.
By /s/ Wayne S. Miller
-------------------------------------
Accepted and Agreed to:
/s/ Aron Goldfarb
- ------------------------------------
EXHIBIT 21
SUBSIDIARIES OF G-III
NAME OF SUBSIDIARY JURISDICTION OF ORGANIZATION
- ------------------------------------ ----------------------------
G-III Leather Fashions, Inc. New York
Siena Leather Ltd. New York
J. Percy for Marvin Richards, Ltd. New York
CK Outerwear, LLC New York
Fabio Licensing, LLC New York
G-III Brands, Ltd. Delaware
G-III License Company, LLC Delaware
G-III Retail Outlets Inc. Delaware
Global Apparel Sourcing, Ltd. Delaware
Indawa Holding Corp. Delaware
PT Balihides Indonesia
G-III Hong Kong Ltd. Hong Kong
Kostroma Limited Hong Kong
Wee Beez International Limited Hong Kong
Global International Trading Company Korea
Exhibit
23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
We consent to the incorporation by
reference in the Registration Statements (Form S-8 Registration Nos.
33-45460, 33-45461, 33-81066, 333-51765, 333-80937, 333-39298,
333-125804 and Form S-3 Registration No. 333-128239) of our report
dated March 30, 2006, with respect to the consolidated
financial statements and schedule of G-III Apparel Group, Ltd. and
subsidiaries included in the Annual Report (Form 10-K) for the year
ended January 31, 2006.
/s/ ERNST &
YOUNG LLP
New York, New York
April 27,
2006
Exhibit
31.1
302 CERTIFICATION
I, Morris Goldfarb, certify
that:
|
|
|
|
1. |
I have reviewed this Annual Report on
Form 10-K/A of G-III Apparel Group,
Ltd.; |
|
|
|
|
2. |
Based on my knowledge, this report does
not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this
report; |
|
|
|
|
3. |
Based on my knowledge, the financial
statements, and other financial information included in this report,
fairly present in all material respects the financial condition,
results of operations and cash flows of the registrant as of, and for,
the periods presented in this report; |
|
|
|
|
4. |
The
registrant’s other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
registrant and have: |
|
|
|
|
(a) |
Designed such disclosure
controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared; |
|
|
|
|
(b) |
Evaluated the effectiveness of the
registrant’s disclosure controls and procedures and presented in
this report our conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered by this
report based on such evaluation;
and |
|
|
|
|
(c) |
Disclosed in this report any change in
the registrant’s internal control over financial reporting that
occurred during the registrant’s fourth fiscal quarter that has
materially affected, or is reasonably likely to materially affect, the
registrant’s internal control over financial reporting; and |
|
|
|
|
5. |
The registrant’s other certifying officer
and I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant’s auditors
and the audit committee of the registrant’s board of
directors: |
|
|
|
|
(a) |
All significant deficiencies and
material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the
registrant’s ability to record, process, summarize and report
financial information; and |
|
|
|
|
(b) |
Any fraud, whether
or not material, that involves management or other employees who have a
significant role in the registrant’s internal control over
financial reporting. |
Date: May 8,
2006
|
/s/ Morris
Goldfarb
Morris Goldfarb
Chief
Executive Officer |
Exhibit
31.2
302 CERTIFICATION
I, Neal S. Nackman,
certify that:
|
|
| 1. |
I have reviewed this Annual
Report on Form 10-K/A of G-III Apparel Group,
Ltd.; |
|
|
| 2. |
Based on my knowledge, this report
does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light
of the circumstances under which such statements were made, not
misleading with respect to the period covered by this
report; |
|
|
| 3. |
Based on my knowledge, the
financial statements, and other financial information included in this
report, fairly present in all material respects the financial
condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this
report; |
|
|
| 4. |
The registrant’s other
certifying officer and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange
Act Rules 13a-15(e) and 15d-15(e)) for the registrant and
have: |
|
|
|
|
(a) |
Designed such disclosure
controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared; |
|
|
|
|
(b) |
Evaluated the
effectiveness of the registrant’s disclosure controls and
procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation;
and |
|
|
|
|
(c) |
Disclosed in this report any
change in the registrant’s internal control over financial
reporting that occurred during the registrant’s fourth fiscal
quarter that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over
financial reporting; and |
|
|
| 5. |
The
registrant’s other certifying officer and I have disclosed,
based on our most recent evaluation of internal control over financial
reporting, to the registrant’s auditors and the audit committee
of the registrant’s board of
directors: |
|
|
|
|
(a) |
All significant
deficiencies and material weaknesses in the design or operation of
internal control over financial reporting which are reasonably likely
to adversely affect the registrant’s ability to record, process,
summarize and report financial information;
and |
|
|
|
|
(b) |
Any fraud, whether or not
material, that involves management or other employees who have a
significant role in the registrant’s internal control over
financial reporting. |
Date: May 8,
2006
|
/s/ Neal S.
Nackman
Neal S. Nackman
Chief
Financial Officer |
![[X]](https://cdn.kscope.io/83ab99a22d42470fd788582635dbd904-xbox.gif){kind=small}
ANNUAL REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE![[ ]](https://cdn.kscope.io/83ab99a22d42470fd788582635dbd904-ebox.gif){kind=small}
TRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF