Exhibit 10.10
THIS LEASE AGREEMENT made as of this
1st day of November, 1997,
BETWEEN: KELLAM
ASSOCIATES, INC. located at Star Route, Vernon, in the
Township of Vernon, in the County of Sussex and State of New
Jersey, herein designated as the “Landlord”.
AND: ANGEL PROJECTS LLC, located c/o
Praedium Management, Inc., 11 Madison Avenue, 26th Floor, New
York, N.Y., Attn: Mr. Thomas R. Arnold, herein designated as
the “Tenant”;
WITNESSETH, THAT, the Landlord does
hereby lease to the Tenant and the Tenant does hereby rent from the
Landlord the following described premises: A tract of 35 acres
comprising Tax Lots 11, 12, & 13, plus a portion of Lot
16, Block 190, as more particularly shown in Schedule A and
described in Schedule B attached hereto (the
“Property”), for a term commencing on November 1,
1997, and ending on December 31, 2035, to be used and occupied
for any purpose permitted by federal, state, county and local
governments.
UPON THE FOLLOWING CONDITIONS AND
COVENANTS:
FIRST : The Tenant covenants and agrees to pay to the
Landlord rent in an amount as determined in accordance with the
following provisions:
A:
FIXED RENT BASIS
(CPI Adjusted)
Annual rent of Two Hundred and
Twelve Thousand Dollars ($212,000.00) (the “Initial Annual
Rent”) shall be paid monthly on the 15th of each month. The
rent shall commence on November 1, 1997 and Tenant agrees to
pay the rent due for the period of November 1, 1997 through
December 31, 1997 on January 15, 1998. The Initial Annual
Rent shall be in effect for the period November 1, 1997
through and including December 31, 1998.
The Initial Annual Rent shall be
increased on each January 1st, commencing January 1,
1999, by the same percentage by which the Consumer Price Index for
Urban Wage Earners and Clerical Workers for the New York, NY
and
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Northeastern New Jersey area shall
have increased since the prior January 1st. The percentage
increase in the cost of living over the prior year shall be
multiplied times the Initial Annual Rent to determine the annual
rent (the “Annual Rent”) for the next year.
B.
PREPAYMENT OF ANNUAL
RENT . Notwithstanding
anything to the contrary set forth in this Lease:
1)
The Initial Annual Rent payable
under this Lease for the period January 1, 1998 through
December 31, 1998 shall be reduced by an amount equal to the
real estate taxes outstanding as of January 1, 1998 (the
“Initial Rent Reduction”) on three condominium units
commonly known as Unit 1, Building G50, Unit 1, Building G51 and
Unit 2, Building G19 at the condominium known as the Stonehill
Condominiums. Such reduction shall be affected by reducing the
monthly payments of the Initial Annual Rent by an amount equal to
the Initial Rent Reduction divided by 12.
2)
The Annual Rent payable under this
Lease for the period January 1, 1999 through December 31,
1999, shall be reduced by $30,000, and such reduction shall be
effected by reducing the monthly payments of Annual Rent for such
period by $2,500.
3)
The Annual Rent payable under this
Lease for the period January 1, 2035 to December 31,
2035, shall be reduced by $30,000, and such reduction shall be
effected by reducing the monthly payments of Annual Rent for such
period by $2,500.
C.
LATE PENALTY
If any installment of any required
payment is not paid within ten (10) days of date it is due,
then interest shall accrue from the original due date on the unpaid
installment at the current prime rate of National Community Bank of
New Jersey or its successors during the first 30 days from said due
date and at prime rate plus 2% thereafter.
As additional rent, Tenant agrees to
pay directly to the Township of Vernon, all of the real property
taxes for the subject premises leased ( i.e. , essentially
Lots 11, 12, 13 and the part of Lot 16 to the North of the
northerly side line of the New Jersey Power and Light Basement)
designated on the Tax Map of the Township of Vernon and shown in
Schedule A, including any roll back taxes that may become
due under the agricultural assessment program.
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Tenant shall keep such tax payments
current and shall furnish proof of tax payment annually on or
before December 1st of each year, beginning on
December 1, 1998.
However, Tenant shall have the right
to seek one or more subdivisions of the Property for the purpose of
creating one or more separate tax lots for all or any portion of
the Property, subject to consent by the Landlord, which consent
shall not be unreasonably denied.
SECOND : IMPROVEMENTS : Tenant shall be
permitted to make any alterations, additions or improvements on the
Property, including but not limited to the ski lift, the aqua skoot
ride, portions of the wave pool, ski runs and road without the
consent of the Landlord and to construct any other facilities on
the Property provided said alterations, additions, improvements and
facilities are permitted by all applicable federal, state, county
and municipal laws and regulations. Unless otherwise provided
herein, all such alterations, additions, improvements, or new
facilities shall belong to and remain the property of the Tenant.
Tenant shall be permitted to construct or install any signs related
to the use of the Property without the consent of the Landlord,
provided said signs are permitted by all applicable federal, state,
county and municipal laws and regulations. It is agreed that all
buildings and improvements placed upon the Property by the Tenant,
its successors and assigns, shall remain the exclusive property of
the Tenant, its successors or assigns, shall be considered as
personalty and not as part of the real estate, and may be
removed or demolished during the lease term, subject to restoration
of the premises by Tenant.
THIRD : REMOVAL OF IMPROVEMENTS : Upon the
termination or expiration of this Lease, or termination or
expiration of any renewal terms of this Lease, provided all rent
has been paid to date. Tenant shall remove all structures,
improvements, alterations or equipment, or parts thereof, from the
Property within one year from the termination
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or expiration of the Lease or any renewal
hereof, unless the parties have agreed in writing that specific
facilities are to be left by Tenant on the Property or to demolish
said structures, improvements, alterations or equipment, or parts
thereof, within a period of one year from the termination or
expiration of the Lease or any renewal hereof. Tenant shall remove
all demolition material and restore the premises by reasonable
grading and seeding. In the event Tenant fails to remove the
equipment as required then such equipment is considered abandoned
and the Landlord may dispose of same at his
discretion.
FOURTH : UTILITIES : Tenant shall provide at its
own cost and expense for all sewer, water, fuel, gas, oil, heat,
electricity, power, materials and services which may be
furnished or used by it in or about the demised premises. Tenant
agrees to remove or pay the cost of removal of all utilities and
any utility easements placed on the premises after the execution of
this Lease, within six (6) months of the termination of this
Lease or any renewal hereof, if the Landlord requests such removal
in writing.
FIFTH : INDEMNITY INSURANCE : Tenant, at
Tenant’s own cost and expense, shall obtain or provide and
keep in full force during the term hereof, general public liability
insurance insuring against any and all liability or claims of
liability arising out of, occasioned by, or resulting from any
accident or otherwise in or about the Property, for injuries to any
person or persons, pursuant to coverage held by Tenant for the
Vernon Valley and Great Gorge Ski areas and Action Park, which
coverage in no event shall be less than $2,000,000.00 for each
occurrence. The policies of insurance shall be issued by companies
authorized to do business in the State of New Jersey and shall name
Landlord as co-insured with respect to the Property. Tenant shall
furnish a certificate of insurance showing said coverage to be in
effect. Tenant will name Landlord as co-insured on its general
liability policies covering the Property for whatever
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amount applies in Tenant’s future policies
for the operation of the Vernon Valley and Grant Gorge Ski Area and
Action Park. Tenant shall hold Landlord harmless from any and all
consequences arising out of activities of Tenant, its agents,
guests or assigns on the Property.
SIXTH : LAWS, REGULATIONS AND APPROVALS :
Tenant shall have the right, at its own expense, to make
applications to appropriate agencies or boards of municipal county,
state and/or federal governments for permission to use the Property
for any uses permitted by federal, state, county, and municipal
laws and regulation. The Landlord agrees to cooperate with the
Tenant in connection with such applications and agrees to sign any
documents that may be required for such purpose. Tenant shall
comply with all laws, rules and orders of all federal, state,
county or municipal governments or departments which may be
applicable to the Property. Nothing herein shall be construed to
bar or impair the right of Tenant to appeal any decision of any
governmental body and during the pendency of any such time for
appeal and/or appeals, Tenant shall not be deemed to be in
violation of the requirements of this paragraph.
SEVENTH : ASSIGNMENT BY TENANT : The Tenant shall
have the right at any time to sublet the Property or any
part thereof or to assign this Lease or any portion thereof to
any person or entity without Landlord’s written consent,
provided that the total payment to Landlord as set forth in
Paragraph FIRST is not decreased as a result of such
assignment.
EIGHT : MORTGAGE : The Tenant shall be
permitted to apply for construction financing and mortgages or
other permanent mortgage financing for improvements and alterations
on the Property. Landlord agrees to join in the execution of all
essential documents to carry out the purposes of this paragraph and
to execute Landlord’s waiver or Mortgagee’s waiver or
similar documents as may be reasonably required by an
institutional lender, equipment lessor, or similar party in
connection with Tenant’s acquisition of financing
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respecting personal property, equipment,
furniture, fixtures, structures, or other improvements, provided
that such Mortgage does not impair the security of the Landlord.
Tenant shall be perm
