Exhibit 10.20
SECOND
AMENDED AND RESTATED LEASE AGREEMENT
THIS SECOND AMENDED AND
RESTATED LEASE AGREEMENT (this “ Lease
” ), is made as of the 26 th day of October,
2007 between 750 PARK PLACE REALTY CO., LLC, with offices at
750 Park Place, Long Beach, New York 11561 (the “
Landlord ” ), and B.J.K. INC., d/b/a Chem
Rx, a with offices at 750 Park Place, Long Beach, New York 11561
(the “ Tenant ” ).
W I T
N E S S E T H
:
WHEREAS, by that
certain lease, dated as of May 1, 2002 (the “
Original Lease ” ), Tenant leased from Landlord
the land described in Exhibit
“ A ” (the “Land” ),
together with all buildings and improvements located on the Land
(including the fixtures located therein), as more fully described
on the Site Plan attached hereto as Exhibit “ B ” (the
“ Building ” ) and the parking areas (the
“ Parking Areas ” ) located on the Land
as more fully described on the Site Plan, and all rights and
appurtenances thereto, and commonly known as 750 Park Place, Long
Beach, New York (Collectively, the “ Premises
” ) for a term of five (5) years from May 1, 2002
through and including April 30, 2007;
WHEREAS, by that
certain Lease Amendment (the “ First Amendment
” ), dated as of January 1, 2004, Landlord and Tenant
extended the term of the Original Lease through and including
December 31, 2012 (the Original Lease, as amended by the First
Amendment, hereinafter referred to as the “ Existing
Lease ” );
WHEREAS, by that
certain Amended and Restated Lease Agreement, dated as of January
1, 2006, Landlord and Tenant amended and restated the Existing
Lease in its entirety (the “ First Amended and Restated
Lease ” );
WHEREAS, Landlord
and Tenant desire to amend and restate the First Amended and
Restated Lease in its entirety (so that the terms and conditions of
the tenancy shall be governed by this Lease);
NOW, THEREFORE,
Landlord and Tenant, in consideration of the foregoing premises and
other good and valuable consideration, the receipt and sufficiency
of which Landlord and Tenant hereby acknowledge, hereby agree as
follows:
1.
TERM/USE OF PREMISES/BASE RENT/ADDITIONAL RENT.
(a)
Term. Landlord hereby leases the Premises to Tenant, and
Tenant hereby leases the Premises from Landlord, upon the terms and
conditions of this Lease for a term of fifteen (15) years (the
“ Term ” ) to commence on January 1, 2006
(the “ Commencement Date ”) and to end on
December 31, 2020 (the “ Expiration Date
” ), unless this Lease shall sooner terminate pursuant to
any of the terms or conditions of this Lease or any applicable Laws
(as defined in Paragraph 3 ). Tenant (or any subtenant or
assignee of Tenant permitted hereunder) may use and occupy the
Premises for any use, other than the Restrictions on Use (as
defined in this Paragraph 1(a) ), permitted by applicable
Laws (the “ Permitted Use ” ), subject to
the prior written consent of Mortgagee (as defined in Paragraph
19 below) to the extent required under
any Mortgage Documents
(as defined in Paragraph 19 below). Tenant shall have
exclusive possession and use of the Parking Areas located on the
Premises for the parking and temporary storage and other related
uses of motor vehicles and industrial and other equipment. Tenant
(or any subtenant or assignee of Tenant permitted hereunder) shall
not, at any time, use or occupy the Premises or any part thereof:
(i) in any manner that may (1) violate any certificate of occupancy
for the Premises or (ii) constitute a violation of the Laws or the
requirements of insurance bodies; or (ii) for a (1) racquet club,
gymnasium, bowling alley, skating rink or other sports or
recreational facility, movie theatre, banquet facility, dance hall,
disco, nightclub, or other entertainment facility including video
game, virtual reality or laser tag room or facility, pool hall,
arcade, indoor children’s recreational facility, amusement
park, carnival or other amusement center, (2) massage parlor, adult
bookstore, a so-called “head” shop, off-track betting,
gambling, gaming or check cashing facility, (3) car wash,
automobile repair work or automotive service or gas station, tire
store, automobile body shop, automobile, boat, trailer or truck
leasing or sales, (4) funeral parlor, animal raising or storage,
pawn shop, flea market or swap meet, or junk yard, (5) drilling for
and/or removal of subsurface substances, dumping, disposal,
incineration or reduction of garbage or refuse or (6) any use which
in Landlord’s reasonable determination constitutes a public
or private nuisance (collectively, “Restrictions on Use”
). Landlord agrees that Tenant’s use of the Premises
as administrative and executive offices and as a warehouse in
connection with Tenant’s pharmaceutical business shall not
fall within any of the Restrictions on Use. Tenant shall provide
Landlord with at least thirty (30) days prior written notice of any
proposed change in the use of the Premises, which notice shall
specify such proposed use of the Premises, and providing such
further information as Landlord reasonably may require.
(b)
Base Rent. Tenant shall pay base rent ( “Base Rent” ) to Landlord
in equal monthly installments in advance on the first (1st) day of
each calendar month and every calendar month during the Term in the
amounts and for the periods set forth below:
|
Period
|
|
Annual Base Rent
|
|
Monthly Base
Rent
|
|
01/01/06 –
12/31/06
|
|
$
|
1,200,000.00
|
|
$
|
100,000.00
|
|
01/01/07 –
12/31/07
|
|
$
|
1,500,000.00
|
|
$
|
125,000.00
|
|
01/01/08 –
12/31/08
|
|
$
|
1,500,000.00
|
|
$
|
125,000.00
|
|
01/01/09 –
12/31/09
|
|
$
|
1,500,000.00
|
|
$
|
125,000.00
|
|
01/01/10 –
12/31/10
|
|
$
|
1,800,000.00
|
|
$
|
150,000.00
|
|
01/01/11 –
12/31/11
|
|
$
|
1,800,000.00
|
|
$
|
150,000.00
|
|
01/01/12 –
12/31/12
|
|
$
|
1,800,000.00
|
|
$
|
150,000.00
|
|
01/01/13 –
12/31/13
|
|
$
|
2,100,000.00
|
|
$
|
175,000.00
|
|
01/01/14 –
12/31/14
|
|
$
|
2,100,000.00
|
|
$
|
175,000.00
|
|
01/01/15 –
12/31/15
|
|
$
|
2,100,000.00
|
|
$
|
175,000.00
|
|
01/01/16 –
12/31/16
|
|
$
|
2,400,000.00
|
|
$
|
200,000.00
|
|
01/01/17 –
12/31/17
|
|
$
|
2,400,000.00
|
|
$
|
200,000.00
|
|
06/01/18 –
05/31/18
|
|
$
|
2,400,000.00
|
|
$
|
200,000.00
|
|
01/01/19 –
12/31/19
|
|
$
|
2,700,000.00
|
|
$
|
225,000.00
|
|
01/01/20 –
12/31/20
|
|
$
|
2,700,000.00
|
|
$
|
225,000.00
|
2
(c)
Additional Rent. All rent (other than Base Rent),
additional rent, sums, charges, expenses and costs identified in
this Lease (collectively, “ Additional rent
” ; Base Rent and Additional Rent are collectively,
“ Rent ” ) shall be paid to Landlord by
Tenant as provided in this Lease. Landlord shall have the same
remedies for a default in payment of Additional Rent as it has for
a default in payment of Base Rent.
(d)
No Abatement. Tenant shall pay the Rent when the same
shall become due and payable, without demand therefore and without
any abatement, deduction or set off whatsoever except as expressly
provided in this Lease.
2.
MAINTENANCE/REPAIRS. Except as otherwise provided in his Lease,
throughout the Term, Tenant shall, at its sole cost and expense,
maintain, repair and replace, in good working order and condition,
subject to normal and customary wear and tear and damage by
casualty or condemnation, all components of the Premises,
including, without limitation, (a) the Land and other exterior
portions of the Premises, including, without limitation, the
sidewalks, driveways, curbs, loading areas, Parking Areas
(including paving, patching, striping, and lighting as necessary),
lawns, and planting and other landscaped areas; (b) all
non-structural and structural elements of the Building, including,
without limitation, foundation, slab, exterior and interior
structural and non-structural walls (including painting),
structural supports and other load bearing superstructure, and roof
and roof structure; and (c) the fixtures, appurtenances and
systems of the Premises, including, without limitation, HVAC,
plumbing, electrical, sprinkler and mechanical systems of the
Building, and the underground utility and sewer pipes and systems
and drainage outside the exterior walls of the Building. Except as
otherwise provided in this Lease, Tenant shall return the Premises
to Landlord on the Expiration Date or earlier termination of this
Lease in good order and condition, subject to normal and customary
wear and tear and damage by casualty or condemnation.
Notwithstanding anything to the contrary contained in this Lease,
all capital replacement costs incurred by Tenant in connection with
the satisfaction of Tenant’s obligations under this
Paragraph 2 shall be equitably pro-rated between Landlord
and Tenant over the economic life of the asset, and Landlord shall
promptly reimburse Tenant for that portion of the cost of such
asset attributable to that portion of the economic life remaining
after the Expiration Date; provided
that , Landlord has given its prior written approval of
such capital replacement and the cost thereof; further provided that , (i) if, within
ten (10) business days after Landlord’s receipt of
Tenant’s request for Landlord’s approval of such
capital replacement and the cost thereof, Landlord shall fail to
deliver to Tenant, in writing, (A) Landlord’s approval or (B)
Landlord’s reasonable objections to such request, stated with
specificity, Tenant may, but shall not be obligated to, deliver to
Landlord a second such written request, within twenty (20) business
days after the first request, marked “SECOND TENANT
REQUEST FOR LANDLORD APPROVAL” at the top of the first
page of such request and in the subject line of any cover letter
from Tenant accompanying such request; and (ii)
Landlord’s
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failure to deliver to
Tenant, in writing, (A) Landlord’s approval or (B)
Landlord’s reasonable objections to such request, stated with
specificity, within five (5) business days following
Landlord’s receipt such second notice shall be a deemed
approval of such proposed capital replacement and the cost thereof,
so long as such capital replacement does not exceed the same or
substantially similar quality and specifications of the component
of the Premises that is the subject of such capital replacement;
however , Tenant shall
still be required to receive any Mortgagee’s written consent
to the extent required under any Mortgage Documents. Tenant’s
rights to reimbursement set forth under this Paragraph 2
shall survive the expiration or earlier termination of this
Lease.
3.
REQUIREMENTS OF LAW.
(a)
Compliance With Laws. Except as otherwise provided in
this Lease, or arising from or relating to Hazardous Materials
present, in, on, under or about the Premises prior to or on the
date hereof, Tenant shall, at its sole expense, comply with all the
laws, statutes, ordinances, orders, regulations, rules and
requirements of every kind and nature relating to the Premises now
or hereafter in effect of the federal, state, county, municipal or
other governmental authorities and agencies and of the New York
Board of Fire Underwriters, whether that be usual or unusual,
ordinary or extraordinary, and whether they or any of them relate
to structural changes or repairs (or non-structural changes or
repairs) of whatever nature, or to charges or requirements incident
to or as the result of any use, occupancy or ownership thereof
(each a “Law”
and collectively, “Laws” ) ; provided,
however, that after prior written notice to Landlord,
Tenant shall have the right to contest by appropriate legal
proceedings diligently conducted in good faith, if necessary in the
name of Landlord, but without cost or expense to Landlord, the
validity or application of any Law affecting the Premises. Landlord
may participate, at Tenant’s cost and expense, in any such
contest of Laws which must be brought in the name of Landlord.
Tenant shall promptly deliver a copy to Landlord of any written
notice Tenant receives of the alleged violation of any Laws. The
judgment of any court of competent jurisdiction, or the admission
of Tenant in any action of proceeding against Tenant, whether
Landlord is a party thereto or not, that any such Law pertaining to
the Premises has been violated, shall be conclusive of that fact as
between Landlord and Tenant.
(b)
Hazardous Materials. As used in this Lease, the term
“ Hazardous Materials
” means any hazardous, dangerous or toxic substance,
material or waste or any pollutant, contaminant or chemical that is
or becomes regulated by any local governmental authority, any
agency of the State of New York or any agency of the United States
Government. The term “ Hazardous Materials ”
includes, without limitation, any material, substance, pollutant,
or contaminant that is (i) designated as a “hazardous
substance” pursuant to Section 311 of the Federal Water
Pollution Control Act (33 U.S.C. §1317), (ii) defined as
“hazardous waste” pursuant to Section 1004 of the
Federal Resource Conservation and Recovery Act, 42 U.S.C.
§6901 et seq. (42 U.S.C. §6903), (iii) defined as a
“hazardous substance” pursuant to Section 101 of the
Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. §9601 et seq. (42 U.S.C. §9601), (iv)
petroleum and any petroleum by-products, and (v) asbestos.
(c)
Tenant’s Hazardous Materials Obligations. Tenant
shall not, nor shall it permit its employees, agents, licensees,
invitees, or contractors (collectively “ Tenant’s Agents” ), to
bring upon, keep, store, use or dispose of any Hazardous Materials
on, in, under or
4
about the Premises,
except for the following, in accordance with applicable Laws: (i)
Hazardous Materials used by Tenant in connection with the use,
maintenance and operation of the Premises for Tenant’s
business purposes, which Landlord acknowledges may result in spills
and discharges of such Hazardous Materials (however, Tenant shall
comply with any such spill or discharge in accordance with the
terms and conditions of this Lease); (ii) gas, diesel fuel, oil and
other petroleum products and petroleum by-products that drip in
normal amounts from equipment or from motor vehicles on parking and
truck-loading areas located at the Premises (however, Tenant shall
comply with any such drip in accordance with the terms and
conditions of this Lease); (iii) Hazardous Materials to be
incorporated or that are contained within Tenant’s products,
equipment or inventory and with respect to which Tenant complies in
all material respects with all Laws in the handling thereof; and
(iv) general office or warehouse supplies (including, without
limitation, ordinary cleaning chemicals and solution) used for
their intended purpose. Except to the extent caused by the
negligence or willful misconduct of Landlord, or arising from or
relating to Hazardous Material present, in, on, under or about the
Premises prior to or on the date hereof, Tenant shall (1) defend,
indemnify, protect and hold Landlord harmless from and against all
Losses (as defined in Paragraph 32(b) below) arising out of
or in connection with the presence, storage, use or disposal of
Hazardous Materials in accordance with and to the extent required
by all applicable Laws. Tenant’s obligations imposed pursuant
to this Paragraph 3(c) shall survive the Expiration Date or
earlier termination of this Lease.
(d)
Landlord’s Hazardous Materials Obligation. Neither
Landlord nor Landlord’s employees, business invitees, agents,
contractors or subcontractors (collectively “
Landlord’s Agents ” ), shall bring upon,
keep, store, use or dispose of any Hazardous Materials in, on,
under or about the Premises.
4.
DESTRUCTION, FIRE AND OTHER CASUALTY.
(a)
Notification and Repair. Upon Tenant’s learning
thereof, without any obligation on the part of Tenant to inspect
therefor, Tenant shall give prompt notice (which notice need not be
a writing) to Landlord of any fire or other casualty to the
Building. Subject to the provisions of Paragraph 4(c) below
and of any Mortgage Documents, if the Building is damaged by fire
or other insured casualty, Landlord (to the extent of any insurance
proceeds received by or made available to Landlord) shall repair
the damage and restore and rebuild the Building, excluding any
Alterations (as defined in Paragraph 23(a) below) and
Tenant’s Property (as defined in Paragraph 30(b)
below), to substantially the condition thereof immediately prior to
the fire or other casualty “ Landlord’s Restoration ” ),
within 270 days after Landlord’s receipt of insurance
proceeds or when such insurance proceeds are made available to
Landlord for Landlord’s Restoration, as may be extended
solely by an event of force majeure. Landlord’s Restoration
shall only be required to be performed to the extent insurance
proceeds are made available to Landlord. To such extent, Landlord
shall use its diligent, good faith efforts to perform
Landlord’s Restoration timely and in such manner as not to
unreasonably interfere with Tenant’s use and occupancy of the
Premises, but Landlord shall not be required to do such repair or
restoration work except during normal business hours of business
days; provided, however,
that Landlord shall have no obligation to repair any damage to, or
to replace, any of Tenant’s Property or any Alterations.
Tenant shall, at its cost and expense, repair and replace
Tenant’s Property and any Alterations to substantially the
condition prior to the damage.
5
(b)
No Rental Abatement. So long as this Lease has not been
terminated pursuant to the provisions of Paragraph 4(c)
below, Tenant shall continue to pay all Rent in accordance with
this Lease after the Building is damaged by fire or other casualty,
and there shall be no abatement of Rent.
(c)
Total Destruction; Untenantable. If the Building shall be
totally destroyed or rendered wholly untenantable by fire or other
casualty, or if the Building shall be so damaged by fire or other
casualty that (in the reasonable opinion of a reputable contractor
or architect designated by Landlord and reasonably acceptable to
Tenant): (i) repair or restoration of the Building requires more
than 270 days or (ii) such repair or restoration requires the
expenditure of more than 30% of the “full insurable
value” (as defined in this Paragraph 4(c) below)
of the Building immediately prior to the casualty, excluding from
such calculation the value of Tenant’s Property or (iii)
Landlord fails to complete Landlord’s Restoration in
accordance with Paragraph 4(a) within 365 days after
Landlord’s receipt of insurance proceeds or when such
insurance proceeds are made available to Landlord for
Landlord’s Restoration, as such 365-day period may be
extended solely by an event of force majeure, Tenant may terminate
this Lease (by so advising Landlord, in writing) within twenty (20)
days after such contractor or architect delivers written notice of
its opinion to Landlord and Tenant or after the expiration of such
365-day period, as the case may be. If the Building shall be
damaged by fire or other casualty on or after July 1, 2017 and such
contractor or architect makes either of the determinations in
clauses (i) or (ii) of this Paragraph 4(c) , then Landlord
may terminate this Lease (by so advising Tenant, in writing) within
twenty (20) days after such contractor or architect delivers
written notice of its opinion to Landlord and Tenant. If either
Tenant or Landlord terminates this Lease in accordance with this
Paragraph 4(c) , the termination shall be effective as of
the date upon which the other receives timely written notice of the
termination pursuant to this Paragraph 4(c). If any such
termination notice is not timely delivered, unless otherwise agreed
in writing by Landlord and Tenant, this Lease shall remain in full
force and effect and Landlord shall perform Landlord’s
Restoration in accordance with Paragraph 4(a). For purposes
of this Paragraph 4(c) only, “full insurable
value” shall mean replacement cost, less the cost of
footings, foundations and other structures below grade.
(d)
Waiver of Section 227 of NYRPL. Tenant hereby expressly
waives the provisions of Section 227 of the New York Real Property
Law, and of any successor law of like import then in force, and
Tenant agrees that the provisions of the Paragraph 4 shall
govern and control in lieu thereof.
5.
ACCESS TO PREMISES. Upon at least twenty-four (24) hours prior
written notice to Tenant (except in the case of emergency),
Landlord and Landlord’s Agents shall have the right to enter
into and upon the Premises, or any part thereof, during normal
business hours for the purpose of examining the same, or making
such repairs or alterations therein as may be necessary for the
safety and preservation thereof and in accordance with
Landlord’s obligations under this Lease. Tenant also agrees
that, upon at least twenty-four (24) hours prior written notice to
Tenant, to permit Landlord or Landlord’s Agents to show the
Premises to actual and prospective purchasers of the Premises or to
actual or prospective lenders to Landlord and, on and after January
1, 2020, to prospective tenants of the Premises, and Tenant further
agrees that on and after January 1, 2020, Landlord shall have the
right to place reasonable notices on the front of the Premises
offering the Premises “To Let” or “For
Sale”, and Tenant hereby agrees to
6
permit the same to
remain thereon without hindrance or molestation from Tenant or its
employees, agents or representatives. Notwithstanding anything to
the contrary contained herein, (i) Tenant may accompany
Landlord’s entry, and that of Landlord’s Agents and
(ii) Landlord and Landlord’s Agent shall use reasonable
efforts to minimize interference with the conduct of Tenant’s
business during any such entry of the premises.
6.
DEFAULT/REMEDIES; GOING DARK.
(a)
Default. Each of the following events, if occurring
during the Term, shall constitute a “ Default ” hereunder: (i) if
Tenant shall default in the payment of any Rent when it is due and
payable and such default shall continue for five (5) business days
after Tenant’s receipt of written notice from Landlord
regarding such default; (ii) if Tenant shall default in purchasing,
or keeping in force at all times during the Term, any
Tenant’s Insurance Policies (as defined in Paragraph
17(b)) and such default shall continue for five (5) days
after Tenant’s receipt of written notice from Landlord
regarding such default; (iii) if Tenant shall default in the
observance or performance of any term, covenant or condition
(except as otherwise expressly provided in this Paragraph
6(a)) of this Lease on Tenant’s part to be observed or
performed for a period of thirty (30) days after Landlord’s
delivery to Tenant of written notice of such default under this
Paragraph 6(a); provided, however, that if such
default is susceptible of cure but cannot reasonably be cured
within such thirty (30)-day period and provided further that Tenant
shall have commenced to cure such default within such thirty
(30)-day period and thereafter diligently and expeditiously
proceeds to cure the same, such thirty (30)-day period shall be
extended for such time as is reasonably necessary for Tenant in the
exercise of due diligence to cure such default, such additional
period not to exceed ninety (90) days; (iv) if Tenant shall default
in the observance of any term, covenant or condition under
Paragraph 25(a) ; or (v) if Tenant makes an assignment for
the benefit of creditors, or if a receiver, liquidator or trustee
shall be appointed for Tenant or of or for any part of
Tenant’s property, or if Tenant admits it is insolvent or is
not able to pay its debts as they mature, or it Tenant shall be
adjudicated a bankrupt or insolvent, or if any petition for
bankruptcy, reorganization or arrangement pursuant to the United
States Bankruptcy Code, or any similar federal or state law now or
hereafter in effect, shall be filed by or against, consented to, or
acquiesced in by, Tenant, or if any proceeding for the dissolution
or liquidation of Tenant shall be instituted; provided, however, if such appointment,
adjudication, petition or proceeding was involuntary and not
consented to by Tenant, upon the same not being discharged, stayed
or dismissed within ninety (90) days.
(b)
Landlord’s Cure Rights Upon Default of Tenant.
Except as provided in Paragraph 17(b), if a Default has
occurred and is continuing and Landlord has delivered (no earlier
than five (5) business days after the first default notice was sent
to Tenant) a second notice of such Default marked “SECOND
NOTICE OF TENANT DEFAULT” at the top of the first page of
such notice, Landlord, without thereby waiving such Default, may
(but shall not be obligated to) perform the same for the account,
and at cost and expense, of Tenant, which cost and expense shall be
paid by Tenant to Landlord within five (5) days after demand.
(c)
Landlord’s Remedies. Without limitation of all
other rights and remedies provided in this Lease, or otherwise at
law or in equity, except that any re-entry of the Premises by
Landlord shall be by legal process, upon any Default, Landlord may,
at its sole option: (A) terminate this Lease and Tenant’s
right of possession of the Premises by giving to the
7
Tenant three (3)
days’ notice of termination of this Lease and, in the event
such notice is given, this Lease and the Term shall come to an end
and expire upon the expiration of said three (3) days with the same
effect as if the date of expiration of said three (3) days were the
Expiration Date expressly set forth in this Lease, but Tenant shall
remain liable for damages and all other sums payable pursuant to
law; or (B) terminate Tenant’s right of possession of the
Premises without terminating this Lease; provided, however, that Landlord may,
whether Landlord elects to proceed under Subparagraphs (A)
or (B) above, re-enter the Premises or any part thereof,
without notice, either by summary proceedings or by any other
applicable legal action or proceeding, and may repossess the
Premises and dispossess the Tenant and any other persons from the
Premises and remove any and all of their property and effects from
the Premises including the Tenant’s Property and Landlord, at
the Landlord’s option, may relet the Premises, or any part
thereof for the account of Tenant, for such commercially reasonable
rent and term and upon such commercially reasonable terms and
conditions, including, without limitation, concessions and free
rent periods, as are acceptable to Landlord. For purposes of any
reletting, at Tenant’s sole cost and expense, Landlord is
authorized to decorate, repair, alter and improve the Premises to
the extent deemed commercially reasonably necessary by Landlord to
relet the Premises (“ Reletting Improvement Costs ” ).
Tenant, on its own behalf and on behalf of all persons claiming
through or under Tenant, including all creditors, does further
hereby waive any and all rights which Tenant and all such persons
might otherwise have under any present or future Laws to redeem the
Premises, or to re-enter or repossess the Premises, or to restore
the operation of this Lease, after (i) Tenant shall have been
dispossessed by a judgment or by warrant of any court or judge, or
(ii) any re-entry by Landlord, or (iii) any expiration or
termination of this Lease and the Term, whether such dispossess,
re-entry, expiration or termination shall be by operation of law or
pursuant to the provisions of this Lease. In the event that the
relation of Landlord and Tenant may cease or terminate by reason of
the re-entry of the Landlord under the terms and covenants
contained in this Lease or by the ejectment of Tenant by summary
proceedings, or after the abandonment of the Premises by Tenant, it
is hereby agreed that Tenant shall remain liable and shall pay in
monthly payments the Base Rent (and any Additional Rent and other
charges payable by Tenant hereunder) which accrues subsequent to
the re-entry by Landlord, and Tenant expressly agrees to pay as
damages for the breach of the covenants herein contained, the
difference between the Rent and the rent collected and received, if
any, by Landlord during the remainder of the unexpired term, such
difference or deficiency between the Rent and the rent collected if
any, shall become due and payable in monthly payments during the
remainder of the unexpired term, or earlier termination of this
Lease by Landlord pursuant to Subparagraph (A) above, as the
amounts of such difference or deficiency shall from time to time be
ascertained (the “ Deficiencies ” ). Whether or not
Landlord shall have collected any monthly Deficiencies as
aforesaid, but subject to application of all monthly Deficiencies
collected by Landlord from Tenant pursuant to the immediately
preceding sentence or otherwise under this Lease, in the event of
the termination of this Lease by Landlord pursuant to
Subparagraph (A) above, Landlord shall be entitled to
recover from Tenant (1) all damages and other sums that Landlord is
entitled to recover under any provision of this Lease or at law or
in equity, including, buy not limited to, all Base Rent and
Additional Rent accrued and unpaid for the period up to and
including such termination date; (2) all other additional sums
payable by Tenant, or for which Tenant is liable, or in respect of
which Tenant has agreed to indemnify Landlord, under any of the
provisions of this Lease, that may be then owing and unpaid; (3)
all reasonable costs and expenses (including, without limitation,
court costs and reasonable
8
attorneys’ fees)
incurred by Landlord in the enforcement of its rights and remedies
under this Lease; and (4) any damages including, without
limitation, an amount equal to the positive difference, if any,
between (x) the discounted present value of the Base Rent required
to be paid for the remainder of the Term (measured from the
effective termination date of this Lease) and (y) the fair market
rental value of the Premises (determined at the date of termination
of this Lease) after deduction (from such fair market rental value)
of the reasonable costs and expenses of reletting the Premises
(including the Reletting Improvement Costs and reasonable legal
fees and brokerage commissions and a reasonable vacancy factor) as
reasonable estimated by Landlord (collectively, the “
Reletting Costs” ).
Notwithstanding anything contained in this Lease to the contrary,
all Reletting Costs incurred by Landlord shall be equitably
prorated if Landlord’s successive reletting of Premises is
for a term extending beyond the Expiration Date. As used herein,
the “discounted present value” and the
“fair market rental value” shall be determined
by reference to the discount rate of 7%. If, before presentation of
proof of such fair market rental value of the Premises to any
court, commission or tribunal, the Premises, or any part thereof,
shall have been relet by Landlord for the period which otherwise
would have constituted the unexpired portion of the Term, or any
part thereof, the amount of rent reserved upon such reletting shall
be deemed, prima facie, to be the fair market rental value for the
part or the whole of the Premises so relet during the term of the
reletting. Solely for the purposes of this Paragraph 6(c),
the term “Base Rent” shall mean the Base Rent in effect
immediately prior to the date upon which this Lease and the Term
shall have expired and come to an end, or the date of re-entry upon
the Premises by Landlord, as the case may be, adjusted to reflect
any increases pursuant to the provisions of Paragraph
1(b).
(
d)
Waiver of Consequential, Indirect, Special, Incidental, Punitive
and Exemplary Damages. Notwithstanding anything to the
contrary (except as provided in Paragraph 30(d) below)
contained in this Lease, Landlord and Tenant each hereby waive
their right to seek to recover any consequential, indirect,
special, incidental, punitive or exemplary damages.
(e)
Going Dark. In the event Tenant ceases to conduct its
business in the Premises for a period of three hundred sixty-five
(365) days (which 365 th day shall be deemed the day
Tenant “ goes dark
”), Landlord shall then have the right, to be exercised at
any time after the date Tenant goes dark, to terminate this Lease
upon written notice to Tenant (the “ Termination Notice ”). In the
event that Landlord exercises its option to terminate this Lease,
then this Lease shall terminate on the ninetieth (90th) day
following the Termination Notice is sent to Tenant (the “
Termination Date ”)
and Landlord and Tenant shall be released from all of their
obligations hereunder after the Termination Date, except those
obligations which expressly survive the expiration or termination
of this Lease. Notwithstanding the foregoing, the Termination
Notice shall not be effective if on or before the Termination Date
Tenant (i) reopens the Premises for the conduct of its business, or
(ii) subleases the entire Premises or assigns this Lease, and the
sublessee or assignee reopens the Premises for the conduct of its
business. Any such sublease or assignment shall be subject to the
provisions of Paragraph 25 . Tenant shall not be deemed to
have ceased operating its business if there is an assignment of
this Lease or a subletting of the Premises in accordance with
Paragraph 25 or the Premises (or any portion thereof) is
closed (1) due to damage by fire or casualty, or a taking by
eminent domain, (2) for Alterations or repairs being diligently
prosecuted, including, without limitation, renovations or
9
other preparations by
an assignee or subtenant, or (3) for the review of and accounting
for inventory by Tenant in the normal course of its
business.
7.
GLASS. Tenant shall promptly replace, at the expense of
Tenant, any and all broken glass in and about the Premises. Tenant
may insure, and keep insured, or self insure unless otherwise
provided in any Mortgage Documents, all plate glass in the
Premises.
8.
NO OBSTRUCTION. Tenant shall neither permanently encumber
nor obstruct the sidewalk in front of, entrance to, or halls and
stairs of the Premises, nor allow the same to be permanently
obstructed or encumbered in any manner by any of Tenant’s
Agents.
9.
SIGNAGE. Subject to compliance with all applicable Laws, (a)
Tenant shall be permitted to use, alter or replace the existing
signs located on the Premises as of the Commencement Date, and to
erect or place, or cause or allow to be erected or placed, any sign
or signs of any kind whatsoever on the interior of the Building
deemed necessary in Tenant’s sole and absolute discretion,
and (b) subject to Landlord’s prior approval, which approval
shall not be unreasonably conditioned, delayed or withheld, and the
approval of any Mortgagee as may be required under any Mortgage
Documents, Tenant may locate any signs at, in or about the entrance
to the Premises or on any exterior part of the Building, including,
without limitation, upon the roof of the Building; provided that such signs are located so
that the same do not affect the integrity of the roof or create any
damage to the roof. Upon termination of this Lease for any reason,
Tenant shall remove all of its signs from the Premises and repair
any damage to the Premises and the Building caused by such removal
to substantially the same condition prior to such removal.
10.
NO LIABILITY OF LANDLORD. Except to the extent attributable
to (a) Landlord’s gross negligence or willful misconduct or
that of any of Landlord’s Agents; (b) Landlord’s
failure to comply with any of its obligations under this Lease; or
(c) as otherwise set forth in this Lease, Landlord shall have no
liability for any damage or injury to person or property caused by
or resulting from steam, electricity, gas, water, rain, ice or
snow, or any leak or flow from or into any part of the Premises or
from any damage or injury resulting or arising from any other cause
or happening with respect to the Premises or Tenant’s use
thereof.
11.
QUIET ENJOYMENT. Subject to the provisions of this Lease, so
long as Tenant pays all of the Rent and performs all of its other
obligations hereunder, Tenant shall at all times peaceably and
quietly have sole and exclusive possession of the Premises, and
shall hold and enjoy the same, and not be disturbed in
Tenant’s possession of the Premises by Landlord or any other
person lawfully claiming through or under Landlord. This covenant
shall be construed as a covenant running with the Premises and is
not a personal covenant of Landlord. Landlord’s entry onto
and use of any portion of the Premises permitted by this Lease
shall not interfere, in any unreasonable respect, with any or all
of (a) Tenant’s rights to occupy and use the Premises (in the
manner and for the purposes contemplated hereunder); (b)
Tenant’s right to utilize the vehicular parking areas located
on the Premises; and (c) Tenant’s right of access, ingress
and egress to and from the Premises.
12.
WATER/ SEWER. Tenant shall pay to Landlord the rent or
charge, which may, during the Term , be assessed or imposed for the
water used or consumed in or on the Premises, whether determined by
meter or otherwise, and will also pay the expenses for the setting
of a
10
water meter in the
Premises should the latter be required. Tenant shall pay the sewer
rent or charge imposed upon the premises. All such rents or charges
or expenses shall be paid as Additional Rent. Landlord shall
provide Tenant with at least ten (10) days written notice in
advance of any required payment therefor and such rents or charges
or expenses shall be added to the next month’s Base Rent to
become due after Tenant’s receipt of a timely notice from
Landlord.
13.
NO WAIVER. The failure of either party to insist, in any one
or more instances, upon the strict performance of any one or more
of the terms, conditions, covenants or 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 or other rights or remedies that
such party may have against the other, and shall not be construed
as a waiver of any subsequent breach or default in the terms,
conditions and covenants of this Lease.
14.
EMINENT DOMAIN. If the whole or any substantial (as
reasonably determined by Landlord) portion, of the Premises is
taken or condemned for any use or purpose under any Law or by right
of eminent domain, or by private purchase in lieu thereof, and such
taking would prevent or materially interfere with Tenant’s
then-current use of the Premises, this Lease shall terminate
effective as of the date Tenant is required to relinquish
Tenant’s right to occupy or to use all or any such
substantial portion of the Premises. If less than a substantial
portion of the Premises is so taken or condemned, or if the taking
or condemnation is temporary (regardless of the portion of the
Premises affected), this Lease shall not terminate, but (a)
Landlord, at Landlord’s sole cost and expense to the extent
of any award actually received by Landlord, shall restore the
Building to an architecturally whole unit, and (b) the Rent payable
hereunder shall be proportionally abated to the extent of any
actual loss of use of the Premises by Tenant. Landlord shall be
entitled to any and all payment, income, rent or award, or any
interest therein whatsoever, which may be paid or made in
connection with such a taking or conveyance, and Tenant shall have
no claim against Landlord for the value of any unexpired portion of
this Lease. Tenant shall be entitled to retain any compensation
specifically and independently awarded to Tenant for loss of
business or goodwill, moving expenses or for Tenant’s
Property.
15.
NO DIMINUTION/ABATEMENT. Except as otherwise provided in
this Lease, (a) no diminution or abatement of Rent, or other
compensation, shall be claimed or allowed for inconvenience arising
from the making of repairs or improvements to the Premises nor in
the case of any fire or other casualty; and (b) in respect to the
various “services,” if any, herein expressly or
impliedly agreed to be furnished by Landlord to Tenant, it is
agreed that there shall be no diminution or abatement of Rent, or
any other compensation, for interruption or curtailment of such
“service” when such interruption or curtailment shall
be due to accident, alterations or repairs desirable or necessary
to be made or to inability or difficulty in securing supplies or
labor for the maintenance of such “service” or to some
other cause, not gross negligence on the part of Landlord. No such
interruption or curtailment of any such “service” shall
be deemed a constructive eviction.
11
16.
REAL ESTATE TAXES.
(a)
Real Estate Taxes. Except as expressly provided
otherwise in this Lease, throughout the Term, in addition to the
Base Rent required under Paragraph 1(b) hereof to be paid by
Tenant, Tenant shall be responsible for all real estate taxes,
assessment of any nature and any and all other impositions general
or special, ordinary or extraordinary, of every kind and nature due
at any time or from time to time, during the Term, in connection
with the ownership, leasing and operation of the Premises, or the
personal property and equipment located therein or used in
connection therewith (“ Taxes ”);
provided, however , in no event shall Tenant be liable
for any franchise taxes; any doing business as taxes; any gift
taxes; any corporate taxes; any estate, inheritance, succession or
transfer taxes charged against Landlord or the estate or interest
of Landlord in the Premises or upon the right of any person to
succeed to the same or any part thereof by inheritance, succession
or transfer, or any capital levy that is imposed upon Landlord or
any transfer or recording charge resulting from a transfer of the
Premises; any income, profits or excess profits tax or gross
receipts tax assessed upon or in respect of the income or receipts
of Landlord arising from the Premises; or any town, county, state
or federal sales taxes or use taxes charged against Landlord for
materials and equipment purchased by Landlord or installed or
incorporated into the reconstruction or repair of the building and
appurtenances or any part thereof by Landlord. Tenant agrees to pay
to Landlord the annual sums payable pursuant to the provisions of
this Paragraph 16 in twelve (12) equal monthly installments
in advance on the first (1st) day of each and every month during
the Term, together with, at the same time and place, in the same
manner and upon the same terms and conditions hereinbefore provided
for the payment of Base Rent, or as payments thereof may be
required under the Mortgage Documents, provided, however, that if when any
such Additional Rent payment provided for in this
Paragraph 16 shall become due, the amount of Taxes for
the then current fiscal period of the taxing authority shall not
have been determined, Tenant shall for such month make payment
based upon the amount of Taxes for the last preceding fiscal period
of the taxing authority, and when the amount of the Taxes for the
then current fiscal period of the taxing authority shall have been
determined, total payments theretofore made for the preceding
months for such fiscal period based on the amount of taxes for the
preceding fiscal period shall be adjusted and Tenant, shall on
demand, make such additional payment to Landlord for such preceding
months, or Landlord shall make such refund to the Tenant of any
overpayments made by Tenant for such preceding months as the
adjusted figures may indicate. Landlord shall pay all Taxes due and
owing during the Term directly to the applicable taxing
authority(ies) before they become delinquent. Notwithstanding
anything to the contrary contained herein, with respect to a fiscal
period of the taxing authority, a part of which period is included
within the Term of this Lease and a part of which is included in a
period of time before the Commencement Date or after the Expiration
Date, Taxes (including, but not limited to, any special
assessments) shall be adjusted as between Landlord and Tenant as of
the Commencement Date and Expiration Date, respectively, so that
Landlord shall pay that proportion of such Taxes which that part of
such fiscal period included in the period of time before the
Commencement Date or after the Expiration Date bears to such fiscal
period, and Tenant shall pay its share of the intervening remainder
thereof. If any special assessments levied against the Premises are
payable in installments, Tenant shall be responsible only for those
installments that are due and payable during the Term (or if paid
in lump sum, shall be amortized over the useful life of the
improvements to which such special assessment relates). For
purposes hereof, Taxes for any year shall be Taxes that are due for
payment or paid in that year rather than Taxes that are assessed,
become a lien, or accrue during such year. Landlord shall send
copies of the related tax
12
bills to Tenant
promptly after a written request with respect to a particular
fiscal period. If Tenant shall have paid an amount of Taxes and
Landlord thereafter receives a refund of such Taxes or a credit
against future Taxes, Tenant shall receive a proportionate credit
(after all costs of obtaining a refund have been deducted) towards
subsequent estimated payments of such Taxes.
(b)
Audit Rights. Tenant may, at Tenant’s sole and
absolute discretion, subject to the terms and conditions of any
Mortgage Documents, contest, or review, by legal proceedings, or in
such other manner as Tenant deems suitable, which proceedings if
instituted shall be conducted promptly, at Tenant’s own
expense, and free of expense to Landlord, any Taxes or sewer or
water rents or charges imposed upon or against the Premises, and
attempt to obtain a reduction in the assessed valuation of the
Premises for the purpose of reducing any such tax assessment. In
case any Taxes or sewer or water rents or charges shall, as a
result of such proceedings or otherwise, be reduced, canceled, set
aside or to any extent discharges, there shall be a subsequent
reduction in Tenant’s payments to Landlord attributable to
Taxes or sewer or water rents or charges for such year and Landlord
shall promptly pay over to any excess payments made by Tenant, when
all refunds or credits to which Landlord is entitled from the
taxing authority with respect to such year have been received or
applied by Landlord. Landlord’s obligation to refund any such
overpayment shall survive such expiration or earlier termination.
Landlord will, at the request of Tenant and without expense to
Landlord, cooperate with Tenant in effecting such a reduction. Any
reduction or tax refund payable as a result of any proceeding
Tenant may institute for that purpose or otherwise shall be the
property of Tenant to the extent to which it may be based on a
payment made by Tenant. Landlord shall not be required to join in
any such action or proceeding, unless required by law or any rule
or regulation in order to make such action or proceeding effective,
in which event any such action or proceeding shall be taken by the
Tenant in the name of, but without expense to Landlord. Landlord,
however, will cooperate to the extent reasonably necessary (without
liability) and supply such data and execute such documents required
for the purpose of
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