LEASE AGREEMENT

 

 

TABLE OF CONTENTS

(continued)

 

			Page
1.	DEFINITIONS:		1
2.	DEMISE; TITLE; CONDITION:		6
3.	TERM; RENEWAL OPTION:		7
4.	RENT:		7
	(a)	Basic Rent and Additional Rent	7
	(b)	Amount of Installments	8
	(c)	Intentionally Omitted	8
	(d)	Holidays	8
	(e)	Overdue Interest	8
	(f)	Additional Rent	8
	(g)	Rent During Renewal Term	8
5.	USE:		9
6.	NET LEASE; NONTERMINABILITY:		9
	(a)	Tenant to Pay All Costs	9
	(b)	Nonterminability	10
	(c)	Bankruptcy; Tenant to Remain Liable	10
7.	TAXES AND OTHER CHARGES; LAW AND AGREEMENTS:		10
	(a)	Taxes, Assessments	10
	(b)	Utility Charge	11
	(c)	Compliance with Laws	11
	(d)	Contest Charges and Compliance	11
8.	LIENS:		12
9.	INDEMNIFICATION; FEES AND EXPENSES:		12
	(a)	Indemnification by Tenant	12
	(b)	Notice; Proceedings	13
10.	ENVIRONMENTAL MATTERS:		13
	(a)	Representations	13
	(b)	Environmental Covenants	14
	(c)	Notice; Right to Contest	15
	(d)	Audit	15

 

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TABLE OF CONTENTS

(continued)

 

			Page
	(e)	Contaminated Leased Property	15
	(f)	Asbestos Program	16
	(g)	Indemnification	17
	(h)	Survival	17
11.	MAINTENANCE AND REPAIR:		17
12.	ALTERATIONS, ADDITIONS AND CONSTRUCTION BY TENANT:		17
	(a)	No Consent for Certain Alterations; Additional Improvements	17
	(b)	Tenant’s Equipment	20
	(c)	“Costs” Defined	20
13.	CONDEMNATION AND CASUALTY; SUBSTITUTION:		20
	(a)	Assignment of Proceeds; Tenant Authorized to Act for Landlord	20
	(b)	Partial Damage or Condemnation; Restore/Repair or Substitute	21
	(c)	(i) Substantial or Complete Destruction or Condemnation: Repair, Substitute, or Terminate	21
	(d)	Net Award Exceeds Alteration Cost Threshold; Tenant in Default	23
	(e)	Temporary Condemnations; Routine Condemnations	24
	(f)	Substitution	25
14.	INSURANCE:		27
15.	FINANCIAL STATEMENTS:		30
16.	DETERMINATION OF FAIR MARKET VALUE OF LEASED PROPERTY; RIGHT OF FIRST REFUSAL; RIGHT TO PURCHASE:		31
	(a)	Fair Market Value	31
	(b)	Right of First Refusal	31
	(c)	Right to Purchase	32
17.	PURCHASE PROCEDURE:		33
18.	[Intentionally Deleted]		33
19.	QUIET ENJOYMENT:		34
20.	TERMINATION:		34
21.	SUBLETTING; ASSIGNMENT:		34
	(a)	Subleases Permitted	34
	(b)	Assignments Permitted	34

 

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TABLE OF CONTENTS

(continued)

 

			Page
	(c)	Restriction on Term of Sublease or Assignment	34
	(d)	Intentionally Omitted	34
	(e)	Intentionally Omitted	34
	(f)	Tenant’s Obligations Continue	34
	(g)	Conformed Copy of Sublease or Assignment	35
	(h)	No Mortgages or Pledges	35
	(i)	Transfers by Landlord	35
22.	ADVANCES BY LANDLORD:		35
23.	CONDITIONAL LIMITATIONS—EVENTS OF DEFAULT AND REMEDIES:		35
	(a)	Events of Default	35
	(b)	Landlord’s Right to Re-enter or Terminate	37
	(c)	Payments by Tenant	37
	(d)	Receipt of Money Not A Reinstatement; No Accounting	38
	(e)	Re-entry Not a Termination	39
	(f)	Enforcement Costs	39
	(g)	Remedies Cumulative	39
	(h)	Notice of Default to Landlord	39
24.	NOTICES:		39
25.	ESTOPPEL CERTIFICATES:		41
26.	NO MERGER:		41
27.	SURRENDER:		42
28.	SEPARABILITY:		42
29.	BINDING EFFECT; MERGER, CONSOLIDATION AND DISPOSAL OF ASSETS:		42
	(a)	Binding Effect	42
	(b)	Mergers, Consolidations	42
	(c)	Credit Rating Rules	43
	(d)	Landlord’s Option to Require the Surviving Entity to Purchase the Leased Property	44
	(e)	No Restrictions on Events with Certain Subsidiaries	45

 

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TABLE OF CONTENTS

(continued)

 

			Page
30.	SHOWING:		45
31.	NATURE OF LANDLORD’S OBLIGATIONS:		45
32.	SUBORDINATION:		45
33.	GRANTING OF EASEMENTS:		46
34.	RECORDING OF LEASE:		47
35.	MISCELLANEOUS:		47
36.	REASONABLE ATTORNEYS’ FEES:		48
37.	ENTIRE AGREEMENT:		48
38.	TERMINATION OF ORIGINAL LEASE:		48

 

1.	Schedule A — Description of Leased Property
2.	Schedule B — Rent Schedule — Basic Rent
3.	Schedule C — Environmental Reports
4.	Schedule C-1 — Tenant’s Environmental and Asbestos Reports
5.	Schedule D — Title Reports
6.	Schedule E — Intentionally Omitted
7.	Schedule F — Termination Value
8.	Schedule G — Representations and Warranties for Substituted Parcels
9.	Schedule H — Group A Properties Subleases
10.	Schedule I — Form of Subordination, Non-Disturbance and Attornment Agreement

 

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LEASE AGREEMENT

 

This Lease (the “Lease”), dated as of April 1, 2003, between FIRST STATES INVESTORS 4000B, LLC (“Landlord”), a Delaware limited liability company, having an office at c/o First States Group, L.P., 1725 The Fairway, Jenkintown, Pennsylvania 19046 and WACHOVIA BANK, NATIONAL ASSOCIATION (“Tenant”), having an address of Lease Administration-Corporate Real Estate, 401 South Tryon Street, NC0114, Charlotte, North Carolina 28288-0114.

 

BACKGROUND OF AGREEMENT

 

WHEREAS , First Union Corporation (now known as Wachovia Corporation), First Union National Bank of North Carolina, First Union National Bank of Georgia and First Union National Bank of Florida (Wachovia Corporation and said banks are collectively referred to herein as the “Original Tenants”), each a direct or indirect predecessor by merger to Tenant, and PREFCO V Limited Partnership (the predecessor in interest to PREFCO Five Limited Partnership), were parties to a certain Lease Agreement dated as of July 31, 1990 (as heretofore amended or modified,  the “Original Lease”); and

 

WHEREAS , First States Group, L.P. has acquired the interest of PREFCO Five Limited Partnership, as landlord, in and to the Original Lease, and, with respect to the Leased Property hereinafter described in Article 2, has assigned such interest to First States Investors 4000B, LLC; and

 

WHEREAS , First States Investors 4000C, LLC has also acquired from Carolina-Relco Limited Partnership, Newco 1 LLC and Newco 2 LLC the interest of the Remainderman in the Leased Property, and now First States Investors 4000B, LLC, as Landlord, owns the entire fee interest in the Leased Property; and

 

WHEREAS , Landlord and Tenant desire to terminate the Original Lease as it pertains to the Leased Property and enter into this Lease for the purpose setting forth their agreement respecting the Leased Property, all as more fully hereinafter set forth.

 

NOW, THEREFORE , in consideration of the mutual covenants and agreements herein contained and intending to be legally bound, Landlord and Tenant covenant and agree as follows:

 

1.              DEFINITIONS:

 

As used in this Lease, the following terms have the meanings set forth below.  Defined terms used in the Background of Agreement above, but not defined below, shall have the meanings set forth in the Original Lease:

 

“Additional Improvements” shall have the meaning given to that term in paragraph (a) of Article 12 hereof.

 

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“Additional Rent” shall have the meaning given to that term in paragraph (f) of Article 4 hereof.

 

“Alteration Cost Threshold” shall have the meaning given to that term in paragraph (a) of Article 12 hereof.

 

“Appraisers” shall mean individuals having not less than five years current experience appraising commercial properties of a nature and type similar to that of the Leased Property in the geographic area where the Leased Property is located and who are licensed in those geographic areas where licenses are required and who either (i) hold an MAI designation conferred by the American Institute of Real Estate Appraisers and are in good standing as independent members thereof, or (ii) hold the Senior Member designation conferred by the American Society of Appraisers and are in good standing as independent members thereof, or any organizations succeeding thereto of similarly recognized national standing.

 

“Asbestos Report” shall mean the report, if any, relating to the presence of any asbestos on the Leased Property prepared for the Original Tenants and Tenant, and listed on Schedule C-1 .

 

“Bankruptcy Act” shall mean Title 11 of the United States Code and any other Federal insolvency or similar law, now or hereafter in effect.

 

“Base Price Index” shall mean the CPI for March, 2003.

 

“Basic Rent” shall have the meaning given to that term in paragraph (b) of Article 4.

 

“Business Day” shall mean any day except Saturdays, Sundays and the days observed by state chartered banks and national banks in the Commonwealth of Pennsylvania or the State of North Carolina as public holidays.

 

“Casualty” shall have the meaning given to that term in paragraph (a) of Article 13 hereof.

 

“Contaminated Leased Property” shall have the meaning given to that term in paragraph (e) of Article 10 hereof.

 

“CPI” shall mean the Consumer Price Index published by the Bureau of Labor Statistics of the United States Department of Labor for “All Urban Consumers” in the table entitled “Consumer Price Index: United States City Average,” or any successor index thereto, all Items (1982-84=100) for the calendar year in question.  In the event that the CPI is converted to a different standard reference base or otherwise revised, the determination of the Alteration Cost Threshold to be made pursuant to Article 12(a) hereof or pursuant to any other provisions of this Lease or other amounts hereunder to be determined by reference to the CPI shall be made with the use of such conversion factor, formula or table for converting the CPI as may be published by the Bureau of Labor Statistics or, if not so published, then with the use of such conversion factor, formula or table as may be published by Prentice-Hall, Inc. or any other nationally recognized publisher of similar statistical information, or if a conversion factor, formula or table is

 

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unavailable, Landlord and Tenant shall agree on another method to adjust the CPI, or any successor thereto, to the figure that would have been arrived at had the manner of computing the CPI in effect on the date of this Lease not been altered. If Landlord and Tenant fail to agree upon a conversion factor, formula, table or other method, the matter will be submitted for resolution by a nationally recognized firm of certified public accountants selected by Landlord and approved by Tenant, which approval shall not be unreasonably withheld, at Tenant’s expense.

 

“Commencement Date” shall mean April 1, 2003.

 

“Condemnation” shall have the meaning given to that term in paragraph (a) of Article 13 hereof.

 

“Credit Rating” shall have the meaning given to that term in Article 29 hereof.

 

“Depository” shall have the meaning given to that term in paragraph (d) of Article 13 hereof.

 

“Environmental Laws” shall mean and include the Resource Conservation and Recovery Act, as amended by the Hazardous and Solid Waste Amendments of 1984, the Comprehensive Environmental Response, Compensation and Liability Act, as amended by the Superfund Amendments and Reauthorization Act of 1986, the Hazardous Materials Transportation Act, the Toxic Substances Control Act, Clean Air Act, the Federal Insecticide, Fungicide and Rodenticide Act and all applicable federal, state and local environmental laws, ordinances, rules, regulations and publications, as any of the foregoing may have been or may be from time to time amended, supplemented or supplanted, and any other federal, state or local laws, ordinances, rules, regulations and publications, now or hereafter existing relating to regulation or control of toxic or hazardous substances or materials.

 

“Environmental Report” means the report respecting the Leased Property prepared for Landlord or First States Group, L.P. and listed on Schedule C hereto relating to the presence and condition of any Hazardous Substances on the Leased Property, and the report, if any, respecting the Leased Property prepared for the Original Tenants and PREFCO Five Limited Partnership by Alliance Technologies Corporation and also prepared for Tenant by other consultants, and listed on Schedule C-1 .

 

“Equipment” shall have the meaning given to that term in Article 2 hereof.

 

“Event” shall have the meaning given to that term in Article 29 hereof.

 

“event of default” shall have the meaning given that term in paragraph (a) of Article 23 hereof.

 

“Hazardous Substance” shall mean and include any, each and all substances or materials regulated pursuant to any Environmental Laws, including, but not limited to, any such substance, emission or material now or hereafter defined as or deemed to be a regulated substance, hazardous substance, toxic substance, pesticide, hazardous waste or any similar or like classification or categorization, thereunder.

 

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“Improvements” shall have the meaning given to that term in Article 2 hereof.

 

“Indemnitee” shall have the meaning given to that term in Article 10 hereof.

 

“Installment Payment Date” shall have the meaning given to that term in paragraph (b) of Article 4 hereof.

 

“Land” shall have the meaning given to that term in Article 2 hereof.

 

 “Landlord’s Lender” shall mean any lender or other entity providing financing to Landlord with respect to the acquisition, development or operation of the Leased Property, including, without limitation, any Landlord’s Mortgagee (as hereinafter defined) and any party to whom Landlord’s interest in this Lease is assigned as security with respect to any said financing.

 

“Landlord’s Mortgagee” shall mean the holder of a first mortgage or deed of trust given by Landlord which encumbers Landlord’s interest in the Leased Property.

 

“Landlord’s Yield” means Landlord’s nominal after-tax book yield and total after-tax cash flow per dollar of equity, on the basis of the same assumptions originally used by Landlord in computing Landlord’s Yield as of the Commencement Date. In the event that Landlord and Tenant are unable to agree to the amount of any adjustment of Basic Rent necessary to preserve Landlord’s Yield hereunder, the matter will be submitted for resolution by a nationally recognized firm of certified public accountants selected by Landlord and reasonably approved by Tenant.

 

“Leased Property” shall have the meaning given to that term in Article 2 hereof.

 

“Like Kind Use and Value” shall have the meaning given to that term in Article 13 hereof.

 

“Net Award” shall mean the entire award, compensation, insurance proceeds or other payment, if any, on account of any condemnation or casualty, less any expenses (including, but not limited to, reasonable attorneys’ fees and expenses) incurred by Landlord in collecting such award, compensation, insurance proceeds or other payment and not paid (or reimbursed to Landlord) by Tenant pursuant to Article 13 hereof.

 

“Overdue Interest Rate” shall have the meaning given to that term in Article 22 hereof.

 

“Permitted Encumbrances” shall mean, with respect to the Leased Property: (a) rights reserved to or vested in any public authority by the terms of any right, power, franchise, grant, license, permit or provision of law affecting the Leased Property, to (i) terminate such right, power, franchise, license or permit, provided that the exercise of such right would not materially impair the use of the Leased Property or materially and adversely affect the value thereof, or (ii) purchase, condemn, appropriate or recapture, or designate a purchaser of, the Leased Property or any portion thereof; (b) any liens thereon for taxes, assessments, fees and other governmental and similar charges referred to in Article 7 of this Lease, and any liens of mechanics, materialmen and laborers for work or services performed or material furnished in

 

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connection with the Leased Property, which are not due and payable, or which are not delinquent to the extent that penalties for nonpayment may be assessed, or the amount or validity of which are being contested as permitted by paragraph (d) of Article 7 hereof; (c) easements, rights-of-way, servitudes, restrictions and other minor defects, encumbrances and irregularities in the title to the Leased Property which do not materially impair the use of the Leased Property or materially and adversely affect the value thereof; (d) rights reserved to or vested in any public authority to control or regulate or use the Leased Property, which rights do not materially impair the use of the Leased Property or materially and adversely affect the value thereof; (e) any mortgage affecting Landlord’s interest in the Leased Property and any assignment of this Lease as further security for the note or notes secured thereby; and (f) all matters affecting title existing on the date of this Lease as set forth in Schedule D hereto, which shall include, without limitation, all title reports obtained in connection with the acquisition of the Leased Property by PREFCO V Limited Partnership and all title reports or commitments obtained by Landlord or First States Group, L.P. in connection with its acquisition of the Leased Property.

 

“QE” shall have the meaning given to that term in paragraph (b) of Article 4 hereof.

 

“Renewal Term” shall have the meaning given to that term in Article 3 hereof.

 

“Routine Condemnation” shall have the meaning given to that term in paragraph (e) of Article 13 hereof.

 

“SEC” shall have the meaning given to that term in paragraph (b) of Article 15 hereof.

 

“Security” shall have the meaning given to that term in Article 29 hereof.

 

“Substitute Parcel” shall have the meaning given to that term in Article 13 hereof.

 

“Surviving Entity” shall have the meaning given to that term in Article 29 hereof.

 

“Tenant’s Equipment” shall have the meaning given to that term in Article 2 hereof.

 

“Tenant’s Loss” shall have the meaning given to that term in paragraph (a) of Article 13 hereof.

 

“Term of this Lease” shall have the meaning given to that term in Article 3 hereof.

 

“Termination Date” shall have the meaning given to that term in paragraph (c) of Article 13 hereof.

 

“Termination Value” shall have the meaning given to that term in paragraph (c) of Article 13 hereof.

 

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Tenant acknowledges that Tenant is fully familiar with the physical condition of the Leased Property and that Landlord makes no representation or warranty, express or implied, with respect to same or the location, use, description, design, merchantability, fitness for use for a particular purpose, condition or durability thereof, or as to quality of the material or workmanship therein, or as to Landlord’s title thereto or ownership thereof, or otherwise; and all risks incidental to the Leased Property shall be borne by Tenant to the extent of matters which arise during the Term of this Lease. Landlord leases and Tenant accepts the Leased Property as is with all faults and in the event of any defect or deficiency of any nature in the Leased Property or any fixture or other item constituting a portion thereof, whether patent or latent, Landlord and Landlord’s Lender shall not have any responsibility or liability with respect thereto. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN NEGOTIATED AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION BY LANDLORD OF, AND LANDLORD DOES HEREBY DISCLAIM ANY AND ALL WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED, WITH RESPECT TO THE LEASED PROPERTY OR ANY FIXTURE OR OTHER ITEM CONSTITUTING A PORTION THEREOF, WHETHER ARISING PURSUANT TO THE UNIFORM COMMERCIAL CODE OR ANY OTHER LAW NOW OR HEREAFTER IN EFFECT OR OTHERWISE.

 

3.                                        TERM; RENEWAL OPTION:

 

Subject to the provisions hereof, Tenant shall have and hold the Leased Property for a term which shall begin as of the date hereof and end on March 31, 2023 (the “Term of this Lease”).  Except as otherwise expressly noted, the Term of this Lease shall also include any Renewal Term(s) properly exercised by Tenant as hereinafter provided.

 

Provided that no default has occurred and is continuing hereunder beyond any applicable cure period, and provided that Tenant is operating its business at the Leased Property, Tenant shall have the right, upon notice delivered to Landlord not fewer than twelve (12) months nor more than fifteen (15) months prior to the expiration of the then current term hereof, to renew this Lease for up to four (4) renewal terms of five (5) years each (each, a “Renewal Term” and collectively, the “Renewal Terms”).  It shall be a condition of the effectiveness of any such exercise by Tenant that no default shall have occurred and be continuing hereunder beyond any applicable cure period and that Tenant shall be in possession of the Leased Property both at the time of exercise and at the inception of the next ensuing Renewal Term.  Tenant shall not have the right to exercise its option to renew this Lease for more than one (1) Renewal Term at a time; provided, however, that at any time that two (2) or more Renewal Terms shall remain unexercised, then subject to the aforesaid conditions, Tenant shall have the right to exercise up to two (2) consecutive Renewal Terms with a single notice.  All of the terms, conditions, covenants and agreements contained herein shall continue with equal force and effect with respect to any Renewal Terms created by the proper exercise by Tenant of its option to renew as contained herein; provided, however, that the Basic Rent shall be determined as provided in Article 4, paragraph (g) below.

 

4.                                        RENT:

 

(a)                                   Basic Rent and Additional Rent .  Tenant shall pay to Landlord all Basic Rent and (to the extent payable to Landlord) Additional Rent by wire transfer of federal funds or

 

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collected funds immediately available to Landlord on the dates when rent is due as provided in Section 4(b) hereof, at Landlord’s address set forth above, or at such other place in the continental United States as Landlord may from time to time designate.

 

(b)                                  Amount of Installments .  During the Term of this Lease, Tenant shall pay to Landlord, the basic rent provided for in Schedule B annexed hereto (“Basic Rent”), in arrears, before 11:00 A.M. Eastern time on and as of the quarter ending (“QE”) on the last day of February, May, August and November of each year (the “Installment Payment Dates”) as set forth on Schedule B. If such payment is received after 11:00 A.M. Eastern time, such payment shall be deemed to be received by Landlord on the next succeeding Business Day.  Lessee shall pay to Landlord per diem interest at the Overdue Interest Rate from the date on which such payment was due to the date on which such payment is deemed to be received pursuant to this paragraph.

 

(c)                                   Intentionally Omitted .

 

(d)                                  Holidays .  If any Installment Payment Date falls on a day which is not a Business Day, Basic Rent shall be due and payable on the next succeeding Business Day without interest or penalty if paid on such Business Day.

 

(e)                                   Overdue Interest .  If Tenant shall fail to make any payment of Additional Rent pursuant to Article 4 hereof or purchase price for the Leased Property pursuant to Articles 13 or 16 hereof or as liquidated damages pursuant to paragraph (c) of Article 23 hereof in the amount and on the date provided for herein, Tenant shall be liable for interest on such late payment at the Overdue Interest Rate from the date such payment was due to and including the date such payment was received.

 

(f)                                     Additional Rent .  All amounts which Tenant is required to pay or discharge pursuant to this Lease in addition to Basic Rent (including any amount payable as the purchase price for the Leased Property pursuant to any provision hereof or as liquidated damages pursuant to paragraph (c) of Article 23) together with any interest or penalty which may be added for late payment thereof, shall constitute additional rent hereunder (“Additional Rent”). In the event of any failure by Tenant to pay or discharge any such amount, Landlord shall have all rights, powers and remedies provided for herein or by law or otherwise in the case of nonpayment of Basic Rent. Tenant may pay Additional Rent directly to the person entitled thereto.

 

(g)                                  Rent During Renewal Term .  Basic Rent for and with respect to each Renewal Term shall be ninety (90%) percent of the annual fair market rent as determined by an independent appraisal of the Leased Property, which rent shall generate not more than a nine (9%) percent yield on the fair market value of the Leased Property (so long as Tenant’s (or any successor entity) credit is rated at least Aa3 by Moody’s or Standard and Poor’s equivalent), such appraisal to be for a retail branch bank use if and to the extent that at the time of the exercise of the renewal option the Leased Property is used as a retail bank facility.  The fair market rent shall be determined by an Appraiser selected by the parties, the cost of which appraisal shall be paid by Landlord.  In the event that the parties shall be unable to agree upon an Appraiser within thirty (30) days after the date that Tenant shall exercise its option to renew, then Landlord shall

 

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have the right, at its option, to invoke the following appraisal procedure by notice in writing to Tenant: Landlord and Tenant shall each appoint an Appraiser within ten (10) days next following receipt of Landlord’s notice to Tenant that Landlord has elected to invoke this appraisal procedure.  If either Landlord or Tenant fails to appoint an Appraiser, the fair market rent (described as aforesaid) shall be determined by the Appraiser which is appointed within such ten (10) day period.  Within thirty (30) days of appointment, the Appraiser or Appraisers shall determine the fair market rent, and if the two Appraisers so appointed are unable to agree upon the fair market rent, the fair market rent shall be the average of the amounts determined by the Appraisers if the greater amount is no more than one hundred and five (105%) percent of the lesser amount.  If the greater amount exceeds one hundred and five (105%) percent of the lesser amount, the determination shall be made by a third Appraiser, who shall be selected within five (5) days after the end of the thirty (30) day period referred to above, by the two Appraisers appointed by the parties.  Such determination shall be made by the third Appraiser within thirty (30) days of his/her appointment.  In such event, the fair market rent shall be the average of the two closest appraised amounts.  In the event the parties are unable to agree on an Appraiser and Landlord invokes the appraisal procedure outlined above, then in such event, Landlord and Tenant shall each pay one-half of the cost of the Appraisers; otherwise, Landlord agrees that it shall bear all costs associated with obtaining the aforesaid appraisals.

 

Basic Rent for each Renewal Term shall be determined as aforesaid, and once determined, shall remain fixed for each respective Renewal Term and shall be paid monthly in arrears, the provisions of Article 4 hereof regarding the payment of Basic Rent quarterly notwithstanding.

 

5.                                        USE:

 

Tenant may use the Leased Property for the financial services business or for any other lawful purpose, provided that any change in use shall not have any detrimental environmental effect on the Leased Property arising out of a violation or violations of Environmental Laws, or result in any increased risk of liability to Landlord, in Landlord’s reasonable judgment, and provided, further, that any and all alterations and improvements to the Leased Property shall be subject to the terms, conditions and limitations contained in Paragraph 12, below.  It is expressly agreed by Landlord that Tenant’s ceasing to do business at the Leased Property and vacating the Leased Property shall not constitute a default hereunder so long as the Leased Property continues to be maintained by Tenant as otherwise required by the terms hereof.

 

6.                                        NET LEASE; NONTERMINABILITY:

 

(a)                                   Tenant to Pay All Costs .  This Lease is a “net lease” and Tenant’s obligations arising or accruing during the Term of this Lease to pay all Basic Rent, Additional Rent, and all other payments hereunder required to be made by Tenant shall be absolute and unconditional, and Tenant shall pay all Basic Rent, Additional Rent and all other payments hereunder required to be made by Tenant without notice, demand, counterclaim, set-off, deduction, or defense, and without abatement, suspension, deferment, diminution or reduction, free from any charges, assessments, impositions, expenses or deductions of any and every kind or nature whatsoever. All costs, expenses and obligations of every kind and nature whatsoever relating to the Leased Property and the appurtenances thereto and the use and occupancy thereof

 

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which may arise or become due and payable with respect to the Term of this Lease (whether or not the same shall become payable during such Term or thereafter) shall be paid by Tenant, and Landlord shall be indemnified and saved harmless by Tenant from and against the same other than by reason of Landlord’s willful misconduct or gross negligence. Tenant assumes the sole responsibility for the condition, use, operation, maintenance, underletting and management of the Leased Property, and Tenant shall indemnify, defend and hold Landlord harmless from and against any and all liability, costs, damages, losses and claims (including reasonable attorneys’ fees and expenses) to the extent of matters which arise or accrue during the Term of this Lease, and Landlord shall have no responsibility in respect thereof and shall have no liability for damage to the property of Tenant or any subtenant of Tenant on any account or for any reason whatsoever other than by reason of Landlord’s willful misconduct or gross negligence. Without limiting the generality of the foregoing, during the Term of this Lease Tenant shall perform all of the obligations of the sublessor under any sublease affecting all or any part of the Leased Property which Tenant may hereafter enter into as sublessor.

 

(b)                                  Nonterminability .  Except as otherwise expressly provided in Articles 10(e)(ii), 13(c) and(f), 16(b), 23(b)(ii) or 29(d) hereof, this Lease shall not terminate, nor shall Tenant have any right to terminate this Lease or to be released or discharged from any obligations or liabilities hereunder for any reason, including, without limitation: (i) any damage to or destruction of the Leased Property; (ii) any restriction, deprivation (including eviction) or prevention of, or any interference with, any use or the occupancy of the Leased Property (whether due to any defect in or failure of Landlord’s title to the Leased Property or otherwise); (iii) any condemnation, requisition or other taking or sale of the use, occupancy or title of or to the Leased Property; (iv) any action, omission or breach on the part of Landlord under this Lease or under any other agreement between Landlord and Tenant; (v) Tenant’s acquisition of ownership of the Leased Property, or any sale or other disposition of the Leased Property; or (vi) any other cause, whether similar or dissimilar to the foregoing, any present or future law notwithstanding.

 

(c)                                   Bankruptcy; Tenant to Remain Liable .  Tenant will remain obligated under this Lease in accordance with its terms, and will not take any action to terminate (except in accordance with the provisions of subsections (c) and (f) of Article 13 hereof), rescind or avoid this Lease for any reason, notwithstanding any bankruptcy, insolvency, reorganization, liquidation, dissolution or other proceeding affecting Landlord or any assignee of Landlord, or any action with respect to this Lease which may be taken by any receiver, trustee or liquidator or by any court. Tenant waives all rights at any time conferred by statute or otherwise to quit, terminate or surrender this Lease or the Leased Property, or to any abatement or deferment of any amount payable by Tenant hereunder, or for damage, loss or expense suffered by Tenant on account of any cause referred to in this Article 6 or otherwise.

 

7.                                        TAXES AND OTHER CHARGES; LAW AND AGREEMENTS:

 

(a)                                   Taxes, Assessments .  Tenant shall pay and discharge, not later than the last day upon which the same may be paid without interest or penalty, all taxes, assessments, levies, fees, water and sewer rents and other governmental and similar charges, general and special, ordinary or extraordinary, and any interest and penalties thereon, which are levied or assessed and become due and payable with respect to the Term of this Lease, whether or not the

 

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same become payable during the Term of this Lease (including all of the taxes, assessments, levies, fees, water and sewer rents and other governmental charges for the year in which this Lease is executed which are now a lien but not yet due and payable) against (i) Landlord and which relate to Landlord’s ownership of the Leased Property, the use and occupancy of the Leased Property or the transactions contemplated by this Lease, (ii) the Leased Property or the interest of Tenant or Landlord therein, (iii) Basic Rent, Additional Rent or any other amount payable by Tenant hereunder, (iv) this Lease or the interest of Tenant or Landlord hereunder, (v) the use, occupancy, construction, repair or rebuilding of the Leased Property or any portion thereof, or (vi) gross receipts from the Leased Property. If any tax or assessment levied or assessed against the Leased Property may legally be paid in installments, Tenant shall have the option to pay such tax or assessment in installments. Anything in the preceding sentence or in this Lease to the contrary notwithstanding, nothing in this Lease shall require payment by Tenant of any income (including any capital gain), franchise, estate, inheritance, or similar taxes of Landlord or Landlord’s Mortgagee, unless such tax is in lieu of or a substitute for any other tax or assessment upon or with respect to the Leased Property, which, if such other tax or assessment were in effect, would be payable by Tenant hereunder. Tenant shall furnish to Landlord, promptly, and in any event within thirty (30) days after demand by Landlord, proof of the payment of any such tax, assessment, levy, fee, rent or charge which is payable by Tenant. Such taxes, assessments, levies, fees, water and sewer rents and other governmental charges shall be apportioned between Landlord and Tenant as of the date on which this Lease terminates or expires.

 

(b)                                  Utility Charge .  Tenant shall pay all charges for utility, communication and other services rendered or used on or about the Leased Property to the extent of such matters which arise or accrue during the Term of this Lease, whether or not payment therefor shall become due after the Term of this Lease.

 

(c)                                   Compliance with Laws .  Tenant shall at all times during the Term of this Lease, at Tenant’s own cost and expense, perform and comply with all laws, rules, orders, ordinances, regulations and requirements now or hereafter enacted or promulgated, of every government and municipality having jurisdiction over the Leased Property and of any agency thereof, relating to the Leased Property, or the Improvements, or the facilities or equipment thereon or therein, or the streets, sidewalks, vaults, vault spaces, curbs and gutters adjoining the Leased Property, or the appurtenances to the Leased Property, or the franchises and privileges connected therewith, whether or not such laws, rules, orders, ordinances, regulations or requirements so involved shall necessitate structural changes, improvements, interference with use and enjoyment of the Leased Property, replacements or repairs, extraordinary as well as ordinary, and Tenant shall so perform and comply, whether or not such laws, rules, orders, ordinances, regulations or requirements shall now exist or shall hereafter be enacted or promulgated, and whether or not such laws, rules, orders, ordinances, regulations or requirements can be said to be within the present contemplation of the parties hereto.

 

(d)                                  Contest Charges and Compliance .  Tenant shall have the right to contest, by appropriate proceedings, any tax, charge, levy, assessment, lien or other encumbrance, and/or any law, rule, order, ordinance, regulation or other governmental requirement affecting the Leased Property, and to postpone payment of or compliance with the same during the pendency of such contest, provided that in the event of such postponement or payment or noncompliance:

 

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(i) Tenant shall not postpone the payment of any such tax, charge, levy, assessment, lien or other encumbrance for such length of time as shall permit the Leased Property, or any lien thereon created by such item being contested, to be sold by federal, state, county or municipal authority for the non-payment thereof; (ii) Tenant shall not postpone compliance with any such law, rule, order, ordinance, regulation or other governmental requirement if Landlord will thereby be subject to civil liability or criminal prosecution, or if any municipal or other governmental authority shall commence a process according to applicable law to carry out any work to comply with the same or to foreclose or sell any lien affecting all or part of the Leased Property which shall have arisen by reason of such postponement or failure of compliance; and (iii) Tenant shall pay, in a timely fashion, all Basic Rent and Additional Rent (other than any item of Additional Rent that Tenant is permitted to contest pursuant to this Lease, so long as Tenant satisfies all of the requirements of this Lease relating to such contest) which shall become due and payable under this Lease.

 

8.                                        LIENS:

 

Tenant will promptly, but no later than sixty (60) days after the filing thereof, remove and discharge of record, by bond or otherwise, any charge, lien, security interest or encumbrance upon the Leased Property, or any Basic Rent, or Additional Rent which arises for any reason, including all liens which arise out of the possession, use, occupancy, construction, repair or rebuilding of the Leased Property or by reason of labor or materials furnished or claimed to have been furnished to Tenant for the Leased Property, but not including any Permitted Encumbrances. Nothing contained in this Lease shall be construed as constituting the consent or request of Landlord, express or implied, to or for the performance by any contractor, laborer, materialman, or vendor of any labor or services or for the furnishing of any materials for any construction, alteration, addition, repair or demolition of or to the Leased Property or any part thereof. Notice is hereby given that Landlord will not be liable for any labor, services or materials furnished or to be furnished to Tenant, or to anyone holding an interest in the Leased Property or any part thereof through or under Tenant, and that no mechanic’s or other liens for any such labor, services or materials shall attach to or affect the interest of Landlord in and to the Leased Property. In the event of the failure of Tenant to discharge any charge, lien, security interest or encumbrance as aforesaid, Landlord may discharge such items by payment or bond or both, and Tenant will repay to Landlord, upon demand, any and all amounts paid by Landlord therefor, or by reason of any liability on such bond, and also any and all incidental expenses, including reasonable attorneys’ fees, incurred by Landlord in connection therewith.

 

9.                                        INDEMNIFICATION; FEES AND EXPENSES:

 

(a)                                   Indemnification by Tenant .  Tenant shall pay, and shall protect, defend, indemnify and hold Landlord and Landlord’s Lender harmless from and against all liabilities, losses, damages, costs, expenses (including reasonable attorneys’ fees and expenses), claims, demands or judgments of any nature arising from or in connection with the following events to the extent such events arise during the Term of this Lease: (i) any injury to, or the death of, any person or any damage to or loss of property on the Leased Property or growing out of or directly or indirectly connected with the ownership by Landlord, use, nonuse, occupancy, construction, repair or rebuilding of the Leased Property (or adjoining property, to the extent that any loss or damage to adjoining property arises from or out of the Leased Property), or resulting from the

 

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condition thereof, other than any injury, death, damage or loss arising out of Landlord’s or Landlord’s Lender’s willful misconduct or gross negligence; and (ii) violation by Tenant of any provision of this Lease whether or not such violation results in a violation of any provision of any mortgage affecting Landlord’s interest in the Leased Property, or of any law, rule, regulation, ordinance or restriction, now or hereafter in effect and affecting the Leased Property, or of any lease or other agreement relating to the Leased Property now or hereafter in effect to which Tenant is a party or by which Tenant is bound, or of any agreement of which Tenant now has actual or constructive notice and which is now in effect, affecting the Leased Property or the ownership by Landlord, use, nonuse, occupancy, construction, repair or rebuilding thereof.

 

(b)                                  Notice; Proceedings .  Should any event occur for which any party hereto is entitled to indemnification pursuant to this Article 9 or other provisions of this Lease, such party shall provide prompt written notice to the other parties describing the nature of such claim. The indemnifying party may assume responsibility for any action to be taken to contest the claim, provided that the indemnifying party will notify the indemnitees in writing of its intention to contest such claim within thirty (30) days after receipt of notice of the claim from the indemnitees. The indemnifying party, at its sole expense, may control all proceedings relating to such contest. The indemnitees will cooperate with the indemnifying party in contesting such claim, provided that the indemnifying party indemnifies and holds harmless the indemnitees for all reasonable costs and expenses (including, without limitation, reasonable attorneys’ fees and expenses) relating to contesting such claim.

 

10.                                  ENVIRONMENTAL MATTERS:

 

(a)                                   Representations .  Tenant represents and warrants to Landlord that:

 

(i)                                      to the best of Tenant’s knowledge, except as described in the Environmental Report and the Asbestos Report, the Leased Property complies with all Environmental Laws;

 

(ii)                                   no notices, complaints or orders of violation or non-compliance with Environmental Laws have been received by Tenant and to the best of Tenant’s knowledge, no federal, state or local environmental investigation is pending or overtly threatened with regard to the Leased Property or any use thereof or any alleged violation of Environmental Laws with regard to the Leased Property;

 

(iii)                                the Leased Property has not been used by Tenant or, to the best of Tenant’s knowledge, except as described in the Environmental Report, by any prior owner to generate, manufacture, refine, produce, or process, or to store, handle, transfer or transport any Hazardous Substance (other than in connection with the operation and maintenance of the Leased Property and in commercially reasonable quantities as a consumer thereof and in compliance with Environmental Laws);

 

(iv)                               to the best of Tenant’s knowledge, and except as described in the Environmental Report, no underground storage tanks or surface impoundments have been installed in the Leased Property in violation of applicable Environmental Laws and, to the best of Tenant’s knowledge and except as described in the Environmental Report, there exists no

 

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petroleum contamination in violation of applicable Environmental Laws to the Leased Property which originated on or off the Leased Property;

 

(v)                                  to the best of Tenant’s knowledge, and except as described in the Environmental Report and in the Asbestos Report, the Leased Property is free of Hazardous Substances and friable asbestos, the removal of which is required or the maintenance of which is prohibited or penalized by any Environmental Law;

 

(vi)                               to the best of Tenant’s knowledge, and except as described in the Environmental Report and the Asbestos Report, the Leased Property contains no Hazardous Substances or friable asbestos which could materially adversely affect any person, the environment or any Property or in any case or in the aggregate, could impose a material liability on Landlord or Landlord’s Mortgagee; and,

 

(vii)                            neither the Environmental Report nor the Asbestos Report discloses any violation of any Environmental Law which, individually or in the aggregate would materially and adversely affect the financial position, business or operations of Tenant, taken as a whole.

 

(b)                                  Environmental Covenants .  Tenant covenants that during the Term of this Lease it (i) shall comply, and cause the Leased Property to comply, with all Environmental Laws applicable to the Leased Property, (ii) shall prohibit the use of the Leased Property for the generation, manufacture, refinement, production, or processing of any Hazardous Substance or for the storage, handling, transfer or transportation of any Hazardous Substance (other than in connection with the operation and maintenance of the Leased Property and in commercially reasonable quantities as a consumer thereof and in compliance with Environmental Laws), (iii) shall not install or permit the installation on the Leased Property of any underground storage tanks or surface impoundments and shall not permit there to exist any petroleum contamination in violation of applicable Environmental Laws to the Leased Property originating on or off the Leased Property (other than in connection with the use, operation and maintenance of the Leased Property and then only in compliance with applicable Environmental Laws and all other applicable laws, rules, orders, ordinances, regulations and requirements now or hereafter enacted or promulgated of every government and municipality having jurisdiction over the Leased Property and of any agency thereof) or asbestos-containing materials in violation of applicable Environmental Laws and (iv) shall cause any alterations of the Leased Property to be done in a way so as to not expose the persons working on or visiting the Leased Property to Hazardous Substances and in connection with any such alterations shall remove any Hazardous Substances present upon the Leased Property which are not in compliance with Environmental Laws or which present a danger to persons working on or visiting the Leased Property.  With respect to any violation of applicable Environmental Laws related to the Leased Property caused by Hazardous Substances originating off of the Leased Property and not generated therefrom by Tenant, its agents, employees or contractors, Landlord, authorizes Tenant to institute any action against the party responsible for such violation.  So long as Tenant is diligently pursuing all available recourse against the party responsible for such violation, and so long as such violation does not pose a risk to public health, materially threaten the use of the Leased Property or the value thereof, or expose Landlord or Landlord’s Lender, in any manner, to any claim or liability, Tenant may defer taking remedial measures to correct the violation caused by Hazardous

 

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Substances originating off of the Leased Property; provided, however that such period of deferral may be terminated by Landlord or Landlord’s Lender at any time if either Landlord or Landlord’s Lender, each in its sole and absolute discretion, believes that the public health, the use of the Leased Property or the value thereof are threatened by such violation or such Hazardous Substances.  In no event shall the ability to defer remedial measures relieve Tenant of the responsibility therefor, which responsibility shall expressly survive the expiration or sooner termination of this Lease.

 

(c)                                   Notice; Right to Contest .  As soon as reasonably possible after obtaining knowledge thereof, Tenant shall give to Landlord notice of the occurrence of any of the following events: (i) the failure of the Leased Property to comply with any Environmental Law; (ii) the receipt by Tenant or any sublessee or assignee of Tenant of any notice, complaint or order of violation or non-compliance of any nature whatsoever with regard to the Leased Property or the use thereof with respect to Environmental Laws; or (iii) the receipt by Tenant or any sublessee or assignee of Tenant of any notice of a pending or threatened investigation that Tenant’s (or its sublessees’ or assignees’) operations on the Leased Property are not in compliance with any Environmental Law. Tenant shall have the right to contest, by appropriate proceedings, any notice, complaint, order or finding of violation or non-compliance with any Environmental Laws affecting the Leased Property or any use thereof by Tenant or its sublessees or assignees, provided the same will not thereby subject Landlord or Landlord’s Lender to civil liability or criminal prosecution or permit any municipal or other governmental authority to commence a process according to applicable law to carry out any work to comply with the same or to foreclose or sell any lien affecting all or any portion of the Leased Property which may arise in connection therewith. If Tenant determines that any Property is in violation of an Environmental Law, Tenant will promptly give Landlord written notice thereof notwithstanding the fact that the matter giving rise to such violation may have been disclosed in the Environmental Report delivered to Landlord and Landlord’s Lender.

 

(d)                                  Audit .  At any time that an event of default shall have occurred and be continuing, or a notice, complaint, or order or finding of violation or non-compliance with Environmental Laws shall have been issued with respect to one or more parcels comprising the Leased Property, at the request of Landlord or Landlord’s Lender, Tenant shall cause to be performed an environmental audit or risk assessment of the relevant portion of the Leased Property and the then uses thereof and Landlord shall retain the right, but not the obligation, to cause to be performed such audit or assessment.  Such an environmental audit or assessment shall be performed by an environmental consultant selected by Landlord and shall include a review of the uses of the Leased Property and an assessment of the possibility of violation or non-compliance of the same with Environmental Laws. All reasonable costs and expenses incurred by Landlord or Landlord’s Lender in connection with such environmental audit or assessment shall be paid by Tenant within fifteen (15) days after demand by Landlord or Landlord’s Lender.

 

(e)                                   Contaminated Leased Property .  If at any time an event or condition shall have occurred and be continuing which results in the Leased Property or any portion thereof being in violation of any Environmental Law, or a notice, complaint, or order or finding of violation or non-compliance with any Environmental Law shall have been received by Tenant with respect to the Leased Property (“Contaminated Leased Property”), Tenant shall either:

 

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(g)                                  Indemnification .  Tenant agrees to indemnify, defend and hold harmless Landlord and each and all of Landlord’s members, partners, shareholders, officers, directors, employees, attorneys and agents and Landlord’s Lender and all of Landlord’s Lender’s members, partners, shareholders, officers, directors, employees, attorneys and agents (collectively called the “Indemnitees”) from and against any and all losses (including, without limitation, diminution in value of the Leased Property), liabilities (including, without limitation, strict liability), suits, obligations, fines, damages, judgments, penalties, claims, charges, costs and expenses (including, without limitation, reasonable fees and disbursements of counsel and consultants for such Indemnitees), which may be suffered or incurred by, or asserted against, an Indemnitee and which arise directly or indirectly out of a violation prior to and during the Term of this Lease of this Article 10 or arise directly or indirectly from the presence of Hazardous Substances on the Leased Property prior to or during the Term of this Lease in amounts or concentrations requiring remediation under applicable law or by order of governmental authority.

 

(h)                                  Survival .  The warranties and obligations of Tenant, and the rights and remedies of Landlord under this Article 10, are in addition to and not in limitation of any other warranties, obligations, rights and remedies provided in this Lease or otherwise at law or in equity and shall survive the substitution of the Leased Property in accordance with Article 13 hereof and the termination of this Lease, either pursuant to the terms hereof or following an event of default.

 

11.                                  MAINTENANCE AND REPAIR:

 

Tenant will, at its cost and expense, keep and maintain the Leased Property in good repair and condition, and will make all structural and non-structural, and ordinary and extraordinary changes, repairs and replacements which may be required to be made upon or in connection with the improvements to the Leased Property in order to keep the same in good repair and condition. Landlord shall not be required to maintain, alter, repair, rebuild or replace any Improvements on the Leased Property or to maintain the Leased Property, and Tenant expressly waives the right to make repairs at the expense of Landlord pursuant to any law at any time in effect.

 

12.                                  ALTERATIONS, ADDITIONS AND CONSTRUCTION BY TENANT:

 

(a)                                   No Consent for Certain Alterations; Additional Improvements .  If Tenant complies with the requirements of this Article 12(a), Tenant may, without the consent of Landlord, at its own cost and expense, make additions or improvements to or alterations of the Improvements now or hereafter erected on the Leased Property, including, without limitation, the construction of new buildings and improvements and the demolition of existing Improvements to replace them with new buildings and improvements (“Additional Improvements”); provided that if and to the extent that the Leased Property is improved as a retail bank facility prior to such additions, improvements or alterations, the Leased Property shall continue to be used as a retail bank facility thereafter.  Landlord acknowledges that (a) the design, plans and physical configuration of a retail bank facility are subject to change to reflect Tenant’s then current design standards for retail bank facilities, as well as the prevailing standards for retail bank facilities observed by national banks within the same geographic region, and (b) additions, improvements, or alterations made by or for Tenant to physically adapt and improve its retail bank facility to

 

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meet such internal or industry standards shall not itself constitute a change in use from a retail bank facility.  In the event that such Additional Improvements are estimated to have a cost less than Seven Hundred Fifty Thousand ($750,000) Dollars (the “Alteration Cost Threshold”), Tenant may make such Additional Improvements without the consent of Landlord.  Commencing on and as of the first anniversary of the Commencement Date and on and as of each anniversary of the Commencement Date thereafter, the Alteration Cost Threshold for the following twelve month period shall be calculated as the amount equal to the product derived by multiplying Seven Hundred Fifty Thousand ($750,000) Dollars by one (1) plus the percentage by which the CPI for such calendar year exceeds the Base Price Index. In the event the information necessary to calculate the Alteration Cost Threshold shall not have been published in sufficient time to permit such calculation to be made on or before the anniversary of the Commencement Date, the Alteration Cost Threshold shall be calculated by using the CPI for the latest month for which it has been published. After publication of the relevant information, Landlord and Tenant shall make appropriate adjustment of the Alteration Cost Threshold.  In no event shall the Alteration Cost Threshold be reduced as a result of any decrease in the CPI.

 

Tenant may, subject to the terms and conditions contained in this Article 12, at its own cost and expense, with the prior written consent of Landlord (which consent will not be unreasonably withheld), make Additional Improvements with an estimated cost in excess of the Alteration Cost Threshold. Notwithstanding the foregoing, Tenant shall not make any Additional Improvements in violation of the terms of any restriction, easement, condition or covenant or other matter affecting title to the Leased Property. The making of all such Additional Improvements shall be subject to the following conditions:

 

(i)                                      Title to Additional Improvements .  Title to any such Additional Improvements shall immediately vest in Landlord and shall be a part of the Leased Property and subject to the terms, covenants and conditions of this Lease;

 

(ii)                                   Authorizations .  No Additional Improvements shall be undertaken until Tenant shall have procured and paid for, so far as the same may be required from time to time, all permits and authorizations of all municipal and other governmental authorities having jurisdiction of the Leased Property. Landlord shall, at Tenant’s expense, join in the application for any such permit or authorization and execute and deliver any document in connection therewith, whenever such joinder is necessary;

 

(iii)                                Standard of Construction .  The making of the Additional Improvements shall be expeditiously completed in a good and workmanlike manner and in compliance with all applicable laws, rules, regulations, ordinances and restrictions then in effect;

 

(iv)                               Approval of Architect or Engineer May be Required .  The making of any Additional improvements involving changes estimated to have a cost (as defined in paragraph (c) of Article 12 hereof) in excess of the Alteration Cost Threshold shall be conducted under the supervision of an architect or engineer employed or engaged and paid by Tenant and approved in writing by Landlord, which approval shall not be unreasonably withheld and which architect or engineer shall be deemed approved by Landlord if such approval or denial is not received within ten (10) Business Days after receipt of said notice; and neither shall be undertaken except in accordance with detailed plans and specifications and cost estimates

 

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prepared by Tenant and approved by Landlord, which approval shall not be unreasonably withheld and which plans and specifications shall be deemed approved by Landlord if such approval or denial is not received within ten (10) Business Days after receipt of said notice;

 

(v)                                  No Adverse Effect on Fair Market Value .  Any Additional Improvements shall, when completed, be of such a character as not to adversely affect the fair market value of the Leased Property or any part thereof, as general purpose buildings, self-contained structural unit(s), capable of being operated independently of any other buildings or improvements, and prior to commencement of construction of the Additional Improvements, if the cost thereof shall be in excess of the Alteration Cost Threshold, Tenant shall furnish Landlord with a certificate (which may be in letter form) confirming that said Additional Improvement is of such a character as to not to adversely affect the fair market value of the Leased Property or any part thereof; if required by Landlord’s Lender, an Appraiser reasonably acceptable to Landlord and Tenant shall resolve any objections made by Landlord to such certificate by appraising, at Tenant’s cost and expense, the Leased Property in question both with or without such Additional Improvements;

 

(vi)                               No Liens .  Subject to the provisions of Article 8, the cost of any Additional Improvements shall be paid by Tenant when due so that the Leased Property shall at all times be free of liens for labor and materials supplied or claimed to have been supplied to the Leased Property;

 

(vii)                            Insurance .  During the period when any demolition or construction in connection with any Additional Improvements is underway, Tenant, or its contractors and subcontractors, shall maintain the following insurance (in addition to the insurance required to be maintained by Tenant pursuant to the provisions of Article 14 hereof): (A) completed value builders risk insurance for the Leased Property, including all building materials thereon, covering loss or damage from fire, lightning, extended coverage perils, sprinkler, leakage, vandalism, malicious mischief and perils insured in an amount not less than the cost, as estimated by Tenant, of the construction of the Additional Improvements and (B) workmen’s compensation insurance covering the full statutory liability as an employer of the contractor performing the work of making such Additional Improvements;

 

(viii)                         Certificate of Occupancy .  Upon completion of the making of the Additional Improvements in accordance with paragraph (a) of this