Exhibit 10.17
STANDARD FORM OF OFFICE
LEASE
The Real Estate Board of New
York, Inc.
Agreement of Lease, made as of this 17th day of October in the year
2005, between Blue River Associates c/o Kaufman Management Co. 450
7th Avenue NYC 1’0123 party of the first part, hereinafter
referred to as OWNER, and Cygne Designs, Inc. party of the second
part, hereinafter referred to as TENANT,
Witnesseth: Owner hereby leases to Tenant and Tenant hereby
hires from Owner Entire 14th Floor in the building known as 215
West 40th Street NYC 10018 in the Borough of Manhattan, City of New
York, for the term of Three (3) years (or until such term shall
sooner cease and expire as hereinafter provided) to commence on the
1st day of November in the year 2005, and to end on the 31st day of
October in the year 2008, and both dates inclusive, at an annual
rental rate of November 1, 2005 - October 31, 2008 $135,000 PA
($11,250.00 PM) which Tenant agrees to pay in lawful money of the
United States, which shall be legal tender in payment of all debts
and dues, public and private, at the time of payment, in equal
monthly installments in advance on the first day of each month
during said term, at the office of Owner or such other place as
Owner may designate, without any setoff or deduction whatsoever,
except that Tenant shall pay first monthly installment(s) on the
execution hereof (unless this lease be a renewal).
In the event that, at the
commencement of the term of this lease, or thereafter, Tenant shall
be in default in the payment of rent to Owner pursuant to the terms
of another lease with Owner or with Owner’s predecessor in
interest, Owner may at Owner’s option and without notice to
Tenant add the amount of such arrears to any monthly installment of
rent payable hereunder and the same shall be payable to Owner as
additional rent.
The parties hereto, for themselves,
their heirs, distributees, executors, administrators, legal
representatives, successors and assigns, hereby covenant as
follows:
Rent:
1. Tenant shall pay the rent as above and as
hereinafter provided.
Occupancy:
2. Tenant shall use and occupy the demised
premises for showroom, design room and general offices and for no
other purpose.
Tenant Alterations:
3. Tenant shall make no changes in or to the
demised premises of any nature without Owner’s prior written
consent. Subject to the prior written consent of Owner, and to the
provisions of this article, Tenant, at Tenant’s expense, may
make alterations, installations, additions or improvements which
are non-structural and which do not affect utility services or
plumbing and electrical lines, in or to the interior of the demised
premises, by using contractors or mechanics first approved in each
instance by Owner. Tenant shall, before making any alterations,
additions, installations or improvements at its expense, obtain all
permits, approvals and certificates required by any governmental or
quasi-governmental bodies and (upon completion) certifi-of final
approval thereof, and shall deliver promptly duplicates of all such
permits, approvals and certificates to Owner, and Tenant agrees to
carry, and will cause Tenant’s contractors and
sub-contractors to carry, such worker’s compensation, general
liability, personal and property damage insurance as Owner may
require. If any mechanic’s lien is filed against the demised
premises, or the building of which the same forms a part, for work
claimed to have been done for, or materials furnished to, Tenant,
whether or not done pursuant to this article, the same shall be
discharged by Tenant, within thirty days thereafter, at
Tenant’s expense, by payment or filing a bond as permitted by
law. All fixtures and all paneling, partitions, railings and like
installations, installed in the demised premises at any time,
either by Tenant or by Owner on Tenant’s behalf, shall, upon
installation, become the property of Owner and shall remain upon
and be surrendered with the demised premises unless Owner, by
notice to Tenant no later than twenty days prior to the date fixed
as the termination of this lease, elects to relinquish
Owner’s right thereto and to have them removed by Tenant, in
which event the same shall be removed from the demised premises by
Tenant prior to the expiration of the lease, at Tenant’s
expense. Nothing in this article shall be construed to give Owner
title to, or to prevent Tenant’s removal of, trade fixtures,
moveable office furniture and equipment, but upon removal of same
from the demised premises or upon removal, of other installations
as may be required by Owner, Tenant shall immediately, and at its
expense, repair and restore the demised premises to the condition
existing prior to any such installations, and repair any damage to
the demised premises or the building due to such removal. All
property, permitted or required to be removed by Tenant at the end
of the term remaining in the demised premises after Tenant’s
removal shall be deemed abandoned and may, at the election of
Owner, either be retained as Owner’s property or may be
removed from the demised premises by the Owner, at Tenant’s
expense.
Maintenance and Repairs:
4. Tenant shall, throughout the term of this
lease, take good care of the demised premises and the fixtures and
appurtenances therein. Tenant shall be responsible for all damage
or injury to the demised premises or any other part of the building
and the systems and equipment thereof, whether requiring structural
or nonstructural repairs caused by, or resulting from,
carelessness, omission, neglect or improper conduct of Tenant,
Tenant’s subtenants, agents, employees, invitees or
licensees, or which arise out of any work, labor, service or
equipment done for, or supplied to, Tenant or any subtenant, or
arising out of the installation, use or operation of the property
or equipment of Tenant or any subtenant. Tenant shall also repair
all damage to the building and the demised premises caused by the
moving of Tenant’s fixtures, furniture and equipment. Tenant
shall promptly make, at Tenant’s expense, all repairs in and
to the demised premises for which Tenant is responsible, using only
the contractor for the trade or trades in question, selected from a
list of at least two contractors per trade submitted by Owner. Any
other repairs in or to the building or the facilities and systems
thereof, for which Tenant is responsible, shall be performed by
Owner at the Tenant’s expense. Owner shall maintain in good
working order and repair the exterior and the structural portions
of the building, including the structural portions of the demised
premises, and the public portions of the building interior and the
building plumbing, electrical, heating and ventilating systems (to
the extent such systems presently exist) serving the demised
premises. Tenant agrees to give prompt notice of any defective
condition in the demised premises for which Owner may be
responsible hereunder. There shall be no allowance to Tenant for
diminution of rental value and no liability on the part of Owner by
reason of inconvenience, annoyance or injury to business arising
from Owner or others making repairs, alterations, additions or
improvements in or to any portion of the building or the demised
premises, or in and to the fixtures, appurtenances or equipment
thereof. It is specifically agreed that Tenant shall not be
entitled to any setoff or reduction of rent by reason of any
failure of Owner to comply with the covenants of this or any other
article of this lease. Tenant agrees that Tenant’s sole
remedy at law in such instance will be by way of an action for
damages for breach of contract. The provisions of this Article 4
shall not apply in the case of fire or other casualty, which are
dealt with in Article 9 hereof.
Window Cleaning:
5. Tenant will not clean nor require, permit,
suffer of allow any window in the demised premises to be cleaned
from the outside in violation of Section 202 of the Labor Law or
any other applicable law, or of the Rules of the Board of Standards
and Appeals, or of any other Board or body having or asserting
jurisdiction.
Requirements of Law, Fire Insurance, Floor
Loads:
6. Prior to the commencement of the lease term,
if Tenant is then in possession, and at all times thereafter,
Tenant, at Tenant’s sole cost and expense, shall promptly
comply with all present and future laws, orders and regulations of
all state, federal, municipal and local governments, departments,
commissions and boards and any direction of any public officer
pursuant to law, and all orders, rules and regulations of the New
York Board of Fire Underwriters, Insurance Services Office, or any
similar body which shall impose any violation, order or duty upon
Owner or Tenant with respect to the demised premises, whether or
not arising out of Tenant’s use or manner of use thereof,
(including Tenant’s permitted use) or, with respect to the
building if arising out of Tenant’s use or manner of use of
the demised premises or the building (including the use permitted
under the lease). Nothing herein shall require Tenant to make
structural repairs or alterations unless Tenant has, by its manner
of use of the demised premises or method of operation therein,
violated any such laws, ordinances, orders, rules, regulations or
requirements with respect thereto. Tenant may, after securing Owner
to Owner’s satisfaction against all damages, interest,
penalties and expenses, including, but not limited to, reasonable
attorneys’ fees, by cash deposit or by surety bond in an
amount and in a company satisfactory to Owner, contest and appeal
any such laws, ordinances, orders, rules, regulations or
requirements provided same is done with all reasonable promptness
and provided such appeal shall not subject Owner to prosecution for
a criminal offense, or constitute a default under any lease or
mortgage under which Owner may be obligated, or cause the demised
premises or any part thereof to be condemned or vacated.
Tenant
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shall not do or permit any act or thing to be
done in or to the demised premises which is contrary to law, or
which will invalidate or be in conflict with public liability, fire
or other policies of insurances at any time carried by or for the
benefit of Owner with respect to the demised premises or the
building of which the demised premises form a part, or which shall
or might subject Owner to any liability or responsibility to any
person, or for property damage. Tenant shall not keep anything in
the demised premises, except as now or hereafter permitted by the
Fire Department, Board of Fire Underwriters, Fire Insurance Rating
Organization or other authority having jurisdiction, and then only
in such manner and such quantity so as not to increase the rate for
fire insurance applicable to the building, nor use the demised
premises in a manner which will increase the insurance rate for the
building or any property located therein over that in effect prior
to the commencement of Tenant’s occupancy. Tenant shall pay
all costs, expenses, fines, penalties, or damages, which may be
imposed upon Owner by reason of Tenant’s failure to comply
with the provisions of this article, and if by reason of such
failure the fire insurance rate shall, at the beginning of this
lease, or at any time thereafter, be higher than it otherwise would
be, then, Tenant shall reimburse Owner, as additional rent
hereunder, for that portion of all fire insurance premiums
thereafter paid by Owner which shall have been charged because of
such failure by Tenant. In any action or proceeding wherein Owner
and Tenant are parties, a schedule or “make-up” of rate
for the building or the demised premises issued by the New York
Fire Insurance Exchange, or other body making fire insurance rates
applicable to said premises shall be conclusive evidence of the
facts therein stated and of the several items and charges in the
fire insurance rates then applicable to said premises. Tenants
shall not place a load upon any floor of the demised premises
exceeding the floor load per square foot area which it was designed
to carry and which is allowed by law. Owner reserves the right to
prescribe the weight and position of all safes, business machines
and mechanical equipment. Such installations shall be placed and
maintained by Tenant, at Tenant’s expense, in settings
sufficient, in Owner’s judgement, to absorb and prevent
vibration, noise and annoyance.
Subordination:
7. This lease is subject and subordinate to all
ground or underlying leases and to all mortgages which may now or
hereafter affect such leases or the real property of which the
demised premises are a part, and to all renewals, modifications,
consolidations, replacements and extensions of any such underlying
leases and mortgages. This clause shall be self-operative and no
further instrument of subordination shall be required by any ground
or underlying lessor or by any mortgagee, affecting any lease or
the real property of which the demised premises are a part. In
confirmation of such subordination, Tenant shall from time to time
execute promptly any certificate that Owner may request.
Property Loss, Damage Reimbursement
Indemnity:
8. Owner or its agents shall not be liable for
any damage to property of Tenant or of others entrusted to
employees of the building, nor for loss of or damage to any
property of Tenant by theft or otherwise, nor for any injury or
damage to persons or property resulting from any cause of
whatsoever nature, unless caused by, or due to, the negligence of
Owner, its agents, servant or employees Owner or its agents will
not be liable for any such damage caused by other tenants or
persons in, upon or about said building, or caused by operations in
construction of any private, public or quasi public work. If at any
time any windows of the demised premises are temporarily closed,
darkened or bricked up (or permanently closed, darkened or bricked
up, if required by law) for any reason whatsoever including, but
not limited to, Owner’s own acts, Owner shall not be liable
for any damage Tenant may sustain thereby, and Tenant shall not be
entitled to any compensation therefor, nor abatement or diminution
of rent, Fan eviction. Tenant shall indemnify and save harmless
Owner against and from all liabilities, obligations, damages,
penalties, claims, costs and expenses for which Owner shall not be
reimbursed by insurance, including reasonable attorneys’
fees, paid, suffered or incurred as a result of any breach by
Tenant, Tenant’s agents, contractors, employees, invitees, or
licensees, of any covenant or condition of this lease, or the
carelessness, negligence or improper conduct of the Tenant,
Tenant’s agents, contractors, employees, invitees or
licensees. Tenant’s liability under this lease extends to the
acts and omissions of any subtenant, and any agent, contractor,
employee invitee or licensee of any subtenant. In case any action
or proceeding is brought against Owner by reason of any such claim,
Tenant, upon written notice from Owner, will, at Tenant’s
expense, resist or defend such action or proceeding by counsel
approved by Owner in writing, such approval not to be unreasonably
withheld.
Destruction, Fire and Other
Casualty:
9. (a) If the demised premises or any part
thereof shall be damaged by fire or other casualty, Tenant shall
give immediate notice thereof to Owner, and this lease shall
continue in full force and effect except as hereinafter set forth.
(b) If the demised premises are partially damaged or rendered
partially unusable by fire or other casualty, the damages thereto
shall be repaired by, and at the expense of, Owner, and the rent
and other items of additional rent, until such repair shall be
substantially completed, shall be apportioned from the day
following the casualty, according to the part of the demised
premises which is usable. (c) If the demised premises are totally
damaged or rendered wholly unusable by fire or other casualty, then
the rent and other items of additional rent, as hereinafter
expressly provided, shall be proportionately paid up to the time of
the casualty, and thenceforth shall cease until the date when the
demised premises shall have been repaired and restored by Owner (or
if sooner reoccupied in part by Tenant then rent shall be
apportioned as provided in subsection (b) above), subject to
Owner’s right to elect not to restore the same as hereinafter
provided. (d) If the demised premises are rendered wholly unusable
or (whether or not the demised premises are damaged in whole or in
part) if the building shall be so damaged that Owner shall decide
to demolish it or to rebuild it, then, in any of such events, Owner
may elect to terminate this lease by written notice to Tenant,
given within ninety (90) days after such fire or casualty, or
thirty (30) days after adjustment of the insurance claim for such
fire or casualty, whichever is sooner, specifying a date for the
expiration of the lease, which date shall not be more than sixty
(60) days after the giving of such notice, and upon the date
specified in such notice the term of this lease shall expire as
fully and completely as if such date were the date set forth above
for the termination of this lease, and Tenant shall forthwith quit,
surrender and vacate the demised premises without prejudice
however, to Landlord’s rights and remedies against Tenant
under the lease provisions in effect prior to such termination, and
any rent owing shall be paid up to such date, and any payments of
rent made by Tenant which were on account of any period subsequent
to such date shall be returned to Tenant. Unless Owner shall serve
a termination notice as provided for herein, Owner shall make the
repairs and restorations under the conditions of (b) and (c)
hereof, with all reasonable expedition, subject to delays due to
adjustment of insurance claims, labor troubles and causes beyond
Owner’s control. After any such casualty, Tenant shall
cooperate with Owner’s restoration by removing from the
demised premises as promptly as reasonably possible, all of
Tenant’s salvageable inventory and moveable equipment,
furniture, and other property. Tenant’s liability for rent
shall resume five (5) days after written notice from Owner that the
demised premises are substantially ready for Tenant’s
occupancy. (e) Nothing contained hereinabove shall relieve Tenant
from liability that may exist as a result of damage form fire or
other casualty. Notwithstanding the foregoing, including
Owner’s obligation to restore under subparagraph (b) above,
each party shall look first to any insurance in its favor before
making any claim against the other party for recovery for loss or
damage resulting from fire or other casualty, and to the extent
that such insurance is in force and collectible, and to the extent
permitted by law, Owner and Tenant each hereby releases and waives
all right of recovery with respect to subparagraphs (b), (d), and
(e) above, against the other or any one claiming through or under
each of them by way of subrogation or otherwise. The release and
waiver herein referred to shall be deemed to include any loss or
damage to the demised premises and/or to any personal property,
equipment, trade fixtures, goods and merchandise located therein.
The foregoing release and waiver shall be in force only if both
releasors’ insurance policies contain a clause providing that
such a release or waiver shall not invalidate the insurance. If,
and to the extent, that such waiver can be obtained only by the
payment of additional premiums, then the party benefiting from the
waiver shall pay such premium within ten days after written demand
or shall be deemed to have agreed that the party obtaining
insurance coverage shall be free of any further obligation under
the provisions hereof with respect to waiver of subrogation. Tenant
acknowledges that Owner will not carry insurance on Tenant’s
furniture and/or furnishings or any fixtures or equipment,
improvements, or appurtenances removable by Tenant, and agrees that
Owner will not be obligated to repair any damage thereto or replace
the same. (f) Tenant hereby waives the provisions of Section 227 of
the Real Property Law and agrees that the provisions of this
article shall govern and control in lieu thereof.
Eminent Domain:
10. If the whole or any part of the demised
premises shall be acquired or condemned by Eminent Domain for any
public or quasi public use or purpose, then, and in that event, the
term of this lease shall cease and terminate from the date of title
vesting in such proceeding, and Tenant shall have no claim for the
value of any unexpired term of said lease, and assigns to Owner,
Tenant’s entire interest in any such award. Tenant shall have
the right to make an independent claim to the condemning authority
for the value of Tenant’s moving expenses and personal
property, trade fixtures and equipment, provided Tenant is entitled
pursuant to the terms of the lease to remove such property, trade
fixture and equipment at the end of the term, and provided further
such claim does not reduce Owner’s award.
Assignment, Mortgage, Etc.:
11. Tenant, for itself, its heirs, distributees,
executors, administrators, legal representatives, successors and
assigns, expressly covenants that it shall not assign, mortgage or
encumber this agreement nor underlet, or suffer or permit the
demised premises or any part thereof to be used by others, without
the prior written consent of Owner in each instance. Transfer of
the majority of the stock of a corporate Tenant or the majority
partnership interest of a partnership Tenant shall be deemed an
assignment. If this lease be assigned, or if the demised premises
or any part thereof be underlet or occupied be anybody other than
Tenant, Owner may, after default by Tenant, collect rent from the
assignee, undertenant or occupant, and apply the net amount
collected to the rent herein reserved, but no such assignment,
underletting, occupancy or collection shall be deemed a wavier of
this covenant, or the acceptance of the assignee, undertenant or
occupant as tenant, or a release of Tenant from the further
performance by Tenant of covenants on the part of Tenant herein
contained. The consent by Owner to an assignment or underletting
shall not in any wise be construed to relieve Tenant from obtaining
the express consent in writing of Owner to any further assignment
or underletting.
Electric Current: