EXHIBIT 10.34

SUBLEASE

FIRST ALBANY COMPANIES INC.,
As Sublandlord

AND

CONNECTECH, LLC d/b/a TELX,
As Subtenant

SUBLEASE

             THIS SUBLEASE (hereinafter referred to as the "Sublease") is made
as of the __ day of January, 1999 between FIRST ALBANY COMPANIES INC., a New
York corporation having offices at 30 South Pearl Street, Albany, New York
12207-1599 hereinafter referred to as "Sublandlord") and CONNECTECH, LLC d/b/a
TELX, a New York limited liability company having offices at 60 Hudson Street,
New York, New York 10013 (hereinafter referred to as "Subtenant')

WITNESSETH

             WHEREAS, pursuant to a certain Lease dated as of May 17, 1994, as
amended by Commencement Date Agreement dated as of June 13, 1994, and as further
amended by Amendment and Extension of Lease dated as of November 1, 1996,
between Teachers Insurance and Annuity Association of America, as landlord
(hereinafter referred to as "Landlord"), and Russian-American Enterprise Fund
and the Fund For Large Enterprises in Russia jointly and severally (hereinafter
collectively referred to as "Russia"), Sublandlord's predecessor-in-interest, as
tenant (Sublandlord having succeeded to the interest of Russia in and to the
Main Lease pursuant to Assignment and Assumption Agreement dated as of November
-, 1996 between Russia and Sublandlord) (hereinafter referred to the "Main
Lease") , Sublandlord is the tenant of certain premises consisting of the entire
thirty-third (33rd) floor (hereinafter referred to as the "Demised Premises") in
the building located at 17 State Street,New York, New York (hereinafter referred
to as the "Building") ; and

             WHEREAS, Sublandlord wishes to sublease to Subtenant, and Subtenant
wishes to sublet from Sublandlord, the Demised Premises (hereinafter referred to
as the "Sublet Premises") a diagram of which is set forth on Schedule A to the
Main Lease and which the parties hereto agree shall be deemed to consist of
13,700 rentable square feet, on the terms and conditions hereinafter set forth.

             NOW, THEREFORE, for and in consideration of the rental payments to
be made hereunder by Subtenant to Sublandlord and the mutual consideration
hereinafter set forth, Sublandlord and Subtenant hereby covenant and agree as
follows:

           1.          Subleasing.

                                                      A.         Sublandlord
does hereby sublease to Subtenant, and Subtenant does hereby hire and take from
Sublandlord, the Sublet Premises for the term and on the conditions hereinafter
set forth, and subject to all the terms, covenants and provisions of the Main
Lease, except as otherwise herein provided.

                                                      B.          The term of
this Sublease shall commence on the date (hereinafter referred to as the
"Sublease Commencement Date") which is the later of (i) the date a fully
executed copy of Landlord's consent, as provided for in Article 18 of this
Sublease,is delivered to Subtenant and (ii) the date vacant broom clean
possession of the Sublet Premises is available to Subtenant and notice thereof
has been given to Subtenant (which notice, notwithstanding anything in this
Sublease to the contrary, may be hand-delivered) and shall expire at midnight on
March 30, 2007, or or such earlier date on which this sublease may expire or be
cancelled or terminated pursuant to its terms or as provided by law (hereinafter
referred to as the "Sublease Expiration Date"). When the Sublease Commencement
Date has occurred and been established, Sublandlord and Subtenant shall, within
thirty (30) days of a request by Sublandlord or Subtenant, execute an agreement
confirming such date as the Sublease Commencement Date. Any failure of the
parties to execute such agreement shall not affect the validity of the Sublease
Commencement Date, the Sublease Expiration Date or this Sublease.

                                                      C.         
Notwithstanding anything to the contrary in the foregoing, Subtenant shall, upon
prior reasonable notice to Sublandlord, have access to the Sublet Premises prior
to the Sublease Commencement Date solely for the purpose of measuring same

 

           2.          Rent.

                                                      A.         Subtenant
covenants and agrees to pay to Sublandlord rent (herein referred to as the
"Fixed Rent") for the Sublet Premises as follows:

                                                                    (i)         
$397,300.00        per        annum ($33,108.33 per month) from the Sublease
Commencement Date through January 31, 2001 (both dates inclusive)

                                                                    (ii)        
$452,100.00        per        annum ($37,675.00 per month) from February 1, 2001
through January 31, 2005 (both dates inclusive)

                                                                    (iii)       
$506,900.00        per        annum ($42,241.67 per month) from February 1, 2005
and thereafter throughout the remainder of the term of this sublease, all of
which shall be payable in advance on the first day of each calendar month.

                           Notwithstanding anything in the foregoing to the
contrary, it is agreed and understood that Subtenant's obligation to pay Fixed
Rent shall commence on the date which is the later of (i) the Sublease
Commencement Date and (ii) February 15, 1999. Payment of the first due and
payable installment of Fixed Rent shall be made upon the execution and delivery
hereof by Subtenant.

                           If the Sublease Commencement Date shall occur on a
day other than the first day of a calendar month, Fixed Rent for the month in
which the first payment of Fixed Rent shall actually be made shall be
apportioned. Fixed Rent and all other amounts payable by Subtenant to
Sublandlord under the provisions of this Sublease (herein referred to as the
"Additional Rent") shall be paid promptly when due, without notice or demand
therefor, and without deduction, abatement, counterclaim or setoff of any amount
or for any reason whatsoever. Fixed Rent and Additional Rent shall be paid to
Sublandlord in lawful money of the United States at the address of Sublandlord
set forth in Article 19 of this Sublease or to such other person and/or at such
other address as Sublandlord may from time to time designate by notice to
Subtenant as provided for herein. No payment by Subtenant or receipt by
Sublandlord of any lesser amount than the amount stipulated to be paid hereunder
shall be deemed other than on account of the earliest stipulated Fixed Rent or
Additional Rent; nor shall any endorsement or statement on any check or letter
be deemed an accord and satisfaction, and Sublandlord may accept any check or
payment without prejudice to Sublandlord's right to recover the balance due or
to pursue any other remedy available to Sublandlord. Any provision in the Main
Lease referring to fixed rent or additional rent incorporated herein by
reference shall be deemed to refer to the Fixed Rent and Additional Rent due
under this Sublease.

                                                      B.          In addition to
the Fixed Rent, Subtenant shall pay to Sublandlord as Additional Rent, within
five (5) days after demand from Sublandlord from time to time: (a) the
difference, if any, between "Tenant's Tax Payment" (as defined in Section 3.2(A)
of the Main Lease) payable by Sublandlord as tenant under the Main Lease during
any "Tax Year" (as defined in Article 1 of the Main Lease) and (ii) Tenant's Tax
Payment payable by Sublandlord as tenant under the Main Lease for fiscal year
July 1,1998 through June 30, 1999; and (b) the difference, if any, between (i)
"Tenant”s Operating payment (as defined in Section 3.3(A) of the Main Lease)
payable by Sublandlord as tenant under the Main Lease during any "Operating
Year" (as defined in Article 1 of the Main Lease) and (ii) Tenant’s Operating
Payment payable by Sublandlord as tenant under the Main Lease for calendar year
January 1, 1999 through December 31, 1999. All such demands shall be accompanied
by a copy of any invoice, bill, notice or request, including Landlord's Tax
Statement and Landlord's Operating Statement, received by Sublandlord from
Landlord. Notwithstanding anything to the contrary in the foregoing,
Sublandlord's demand for Additional Rent as aforesaid shall not be made more
than fifteen (15) days prior to the date Sublandlord has to pay Landlord
Tenant's Tax Payment and Tenant's Operating Payment. Subtenant shall also pay to
Sublandlord as Additional Rent, upon demand from time to time, all other amounts
payable by Sublandlord to Landlord under the Main Lease allocable to the Sublet
Premises and to the term of this Sublease pursuant to the provisions thereof. If
Sublandlord is required by Landlord under the Main Lease to make advance
payment,  estimated payments or deposits of any of the foregoing amounts,
Subtenant shall make 100% of such advance payments, estimated payments or
deposits to Sublandlord consistent with the above provisions. Subtenant's
obligations under this Article 2 shall be apportioned for any period at the
beginning or end of the term of this Sublease that is less than a full calendar
year or fiscal year. Sublandlord shall have the right to demand payment of any
amount of such Additional Rent during the term of this Sublease or after the
expiration of the term of this Sublease or the earlier termination of this
Sublease.

 

                                                      C.          If the sum of
any installment or estimated payments made by Subtenant on account of any or all
of the items set forth in subparagraph B of this Article 2 exceed Sublandlord's
share of such item(s) with respect to the Sublet Premises under the Main Lease
for any year, Sublandlord shall refund the excess to Subtenant within ten (10)
days after the amount of the excess is refunded to Sublandlord by Landlord. If
the sum of any installment or estimated payments made by Subtenant on account of
any or all of the items set forth in subparagraph B of this Article 2 are less
than Sublandlord's share of such item(s) with respect to the Sublet Premises
under the Main Lease for any year, Subtenant shall pay the amount of such
deficiency to Sublandlord within ten (10) days after demand.

                                                      D.         All costs,
expenses and fees other than Fixed Rent which Subtenant assumes or agrees to pay
pursuant to this Sublease (including without limitation1 all costs expenses and
fees payable by Sublandlord as tenant under the Main Lease with respect to the
Sublet Premises which are payable hereunder by Subtenant by their incorporation
herein by reference to the Main Lease) shall be deemed Additional Rent and, in
the event of non-payment, Sublandlord shall have all the rights and remedies
provided for in the case of non-payment of Fixed Rent.

                                                      E.          Subtenant
shall pay, on or before the date same is due, any occupancy, sales, use or
similar tax, charge or fee that is at any time due or payable with respect to
the occupancy or use of the Sublet Premises or the payment of Fixed Rent or
Additional Rent by Subtenant to Sublandlord, and which is attributable to this
Sublease and/or the Sublease Term.

           3.          Subordination to Main Lease.

                                         This Sublease is and shall be expressly
subject and subordinate to the Main Lease and the terms, provisions, covenants
and conditions thereof. This Sublease is also subject and subordinate to all
instruments, agreements and other matters to which the Main Lease is or shall be
subject or subordinate.

           4.          Rights and Obligations; Exceptions.

                                                      A.         Subtenant
acknowledges that Sublandlord has provided Subtenant with a copy of the Main
Lease (with certain financial terms redacted) for its review. Subtenant confirms
that Subtenant has read the Main Lease and is familiar with the terms and
provisions thereof. Except as otherwise expressly provided herein, all of the
terms, provisions, covenants, agreements and conditions of the Main Lease are
incorporated herein by reference and made a part of this Sublease with the same
force and effect as though set forth in full herein. Subtenant shall conform to,
and use the Sublet Premises in accordance with, all the terms, provisions,
covenants, agreements and conditions of the Main Lease as same apply to the
Sublet Premises, and will do no act which will result in a violation of said
terms, provisions, covenants, agreements and conditions. Subtenant shall perform
the terms, provisions, covenants, agreements and conditions of the Main Lease on
the part of the tenant therein named to be performed with respect to the Sublet
Premises (except as otherwise may be expressly provided herein) To the extent
there are inconsistencies between any provision of the Main Lease and any
provision of this Sublease, this Sublease shall control unless the use or
occupancy of the Sublet Premises by Subtenant or any action or inaction by
Subtenant in accordance with said provision becomes a default under the terms of
the Main Lease, in which event the provisions of the Main Lease shall control.

                           Subtenant shall be entitled to the rights of
Sublandlord, as tenant under the Main Lease insofar as the same relate to the
Sublet Premises. Sublandlord shall have no liability by reason of any default of
Landlord under the Main Lease, it being understood that if Sublandlord shall
fail to fulfill any obligation of the Sublandlord hereunder and if such failure
is caused by the failure of Landlord to comply with its obligations under the
Main Lease, then Sublandlord shall have no obligation or liability by reason of
such failure, but in such event Subtenant shall be subrogated to the rights of
Sublandlord to enforce the obligations of Landlord under the Main Lease insofar
as such obligations relate to the Sublet Premises. Without limiting the
generality of the foregoing, Subtenant understands that the supplying of
services including, without limitation, heat, light, water, air conditioning and
other utilities,  janitorial cleaning, window washing and elevator services, and
building maintenance and repair are the obligations of the Landlord and that
Sublandlord has no control thereof, and assumes no responsibility in connection
therewith; and no failure to furnish, or interruption of, any such services or
facilities shall give rise to any (a) abatement, diminution or reduction of
Subtenant's obligations under this Sublease, (b) constructive eviction, in whole
or in part, or (c) liability on the part of the Sublandlord.

 

                           If the Landlord shall default in any of its
obligations to Sublandlord with respect to the Sublet Premises, Subtenant, at
Subtenant's sole cost and expense, shall have the right in its own name, that of
Sublandlord, or both, to bring an action or proceeding with respect to such
default, and Subtenant hereby is subrogated to the rights of Sublandlord against
Landlord to the extent that  the same shall apply to he Sublet Premises.
Sublandlord agrees to take such steps at Subtenant's sole cost and expense, as
Subtenant may reasonably request to cooperate with Subtenant in any such legal
proceeding or action. If Subtenant shall commence any proceeding or take any
other action to enforce the obligations of the Landlord insofar as such
obligations relate to the Sublet Premises, Subtenant agrees to indemnify and
hold Sublandlord harmless from and against any costs, liabilities, damages or
expenses (including attorney's fees) which Sublandlord may incur in connection
therewith or by reason thereof.

                           Notwithstanding anything to the contrary in the
foregoing, Sublandlord shall promptly forward to Landlord any requests or other
communications made by Subtenant related to the performance by Landlord of its
obligation under the Main Lease, as they pertain to the Sublet Premises, and
shall promptly forward to the Subtenant any communication received from the
Landlord related to the Sublet Premises.

                                         B.          Notwithstanding anything to
the contrary contained in this Sublease or the Main Lease:

                                                      (i)          for the
purposes of incorporation of the Main Lease by reference in this Sublease,
except as otherwise expressly provided herein, and except to the extent that
they are inapplicable or modified by the terms and provisions of this Sublease
(a) references in the Main Lease to the “Demised Premises" shall be deemed to
refer to the Sublet Premises, (b) references in the Main Lease to "Landlord"
shall be deemed to refer to Sublandlord under this Sublease, (c) references in
the Main Lease to "Tenant" shall be deemed to refer to Subtenant under this
Sublease, (d) references in the Main Lease to "this Lease" shall be deemed to
refer to this Sublease,  (e) references in the Main Lease to the "Term" of the
Lease shall be deemed to refer to the term of this Sublease, (f) references in
the Main Lease to the "Expiration Date" shall be deemed to refer to the Sublease
Expiration Date, and (g) references in the Main Lease to the "Commencement Date"
shall be deemed references to the Sublease Commencement Date;

                                                      (ii)         the Fixed
Rent and Additional Rent to be paid by Subtenant hereunder shall be governed by
the terms and provisions of Article 2 of this Sublease;

                                                      (iii)        the time
limits contained in the Main Lease for the giving of notices, making of demands
or performing of any act, condition or covenant on the part of the tenant
thereunder, or for the exercise by the tenant thereunder of any right, remedy or
option, are changed for the purposes of incorporation herein by reference by
shortening the same in each instance by five (5) days, so that in each instance
Subtenant shall have five (5) days less time to observe or perform hereunder
than Sublandlord has as the tenant under the Main Lease;

                                                      (iv)       the following
parts, provisions and exhibits of the Main Lease are not applicable to this
Sublease, and are not incorporated herein by reference

                                         (a)         Articles 32, 35, 39, and
40;

                                         (b)        Sections 2.8, 6.4, 10.6, the
third sentence of Section 28.2, and Nos. (11), (14) and (17) of the Reference
Page;

                                         (c)         Schedules D, E, F, C, and
H; and

                                         (d)        Paragraphs 5, 6, 7, 8, and 9
of the Amendment and Extension of Lease

           5.          Use.

                                                      Subtenant shall use the
Sublet Premises for executive, administrative and general offices and purposes
incidental thereto, and for no other purposes.

 

           6.          Electricity.

                                                      Subtenant acknowledges
that there presently exists a submeter measuring electrical consumption and
demand for the Demised Premises pursuant to the provisions of Article 4 of the
Main Lease.  Subtenant shall pay to Sublandlord all amounts payable for
electricity with respect to the Sublet Premises by Sublandlord to Landlord which
amount shall be paid within ten (10) days of a request by Sublandlord therefore,
which request shall be accompanied by a copy of the bill received by Sublandlord
from Landlord under the Main Lease

           7.          Default.

                                                      Subtenant covenants and
agrees that in the event that it shall default in the performance of any of the
terms, covenants and conditions of this Sublease (including those portions of
the Main Lease incorporated herein by reference) beyond any applicable notice
and grace period provided for in the Main Lease and incorporated herein by
reference (as shortened by Article 4 (B) (iii) hereof)1 Sublandlord shall be
entitled to exercise any and all of the rights and remedies to which it is
entitled by law, including, without limitation, the remedy of summary
proceeding, and also any and all of the rights and remedies specifically
provided for in the Main Lease and incorporated herein by reference.

           8.          Condition of Sublet Premises.

                                                      The Sublet Premises are
demised to Subtenant in the condition which shall exist on the Sublease
Commencement Date "as is", except that the Sublet Premises shall be delivered in
broom clean condition and the carpet shall be professionally cleaned and except
as otherwise hereinafter provided. Subtenant is subleasing the Sublet Premises
from the Sublandlord after having had an opportunity to fully inspect the Sublet
Premises and the right not to execute  this Sublease if the results of said
inspection were unacceptable. Therefore, except as otherwise hereinafter
provided, Subtenant hereby agrees that the term "as is" means that upon having
approved said inspection, it will sublease the Sublet Premises, without warranty
or representation, either oral or written, or expressed or implied, as to the
physical condition of the Sublet Premises and/or the compliance of same with
building, fire, health and zoning codes and other applicable laws, ordinances
and regulations. Sublandlord hereby expressly disclaims any and all warranties
or representations made to Subtenant, whether same were made by any partner,
officer, director or employee of Sublandlord or any other agent of same, such as
a broker, unless such warranty or representation is contained in writing as a
part of this Sublease Except as otherwise provided for herein (i) Sublandlord
shall not incur any greater obligation, financial or otherwise, in connection
with the Sublet Premises than it would have had but for this Sublease, and (ii)
Subtenant shall be solely responsible for all costs which may be imposed on
Sublandlord or Subtenant under the Main Lease in connection with the condition
of the Sublet Premises.

           9.          Improvements.

                                                      A.         Subtenant may
make changes, alterations, additions or improvements to the Sublet Premises,
subject, however, to the consent of Sublandlord, which consent shall not be
unreasonably withheld or delayed, and of Landlord, to the extent required under
the Main Lease. Any changes, alterations, additions or improvements by or on
behalf of Subtenant shall be made subject to and in accordance with the
provisions of the Main Lease.

                                                      B.          Subtenant
shall pay any and all fees or charges Sublandlord may incur and any and all fees
or charges Landlord may incur in connection with Subtenant's making changes,
alterations,  additions or improvements to the Sublet Premises. Except as
expressly set forth in this Sublease, on or before the expiration or sooner
termination of this Sublease, if Landlord requires Sublandlord to restore the
Sublet Premises to their condition prior to the making of any changes,
alterations, additions or improvements by Sublandlord and/or Subtenant,
Subtenant shall, at its sole cost and expense, promptly remove Subtenant's
changes, alterations, additions or improvements to the Sublet Premises, and
repair any damage caused by such removal.

           10.        Additional Services Required by Subtenant

                                                      Subtenant shall attempt to
make its own arrangements with Landlord for the furnishing of additional
services to the Sublet Premises other than those which are required to be
furnished by Landlord under the terms of the Main Lease and any such additional
services shall be paid for by Subtenant. If Landlord shall refuse to respond to
such request for additional service, Sublandlord shall, at Subtenant's sole cost
and expense, request Landlord to perform such additional services at Subtenant's
sole cost and expense. For the purposes of this Article 10, the term "additional
services" shall include, but not be limited to, overtime HVAC service, overtime
freight elevator service and increased capacity of electric energy.

 

           11.        Assignment and Subletting

                                                      Subtenant, for itself, its
heirs, distributees, executors, administrators, legal representatives,
successors and assigns, expressly covenants that it shall not assign, mortgage
or encumber this Sublease, nor underlet, or suffer or permit the Sublet Premises
or any part thereof to be used by others, without the prior written consent of
Sublandlord (which Sublandlord agrees shall not be unreasonably withheld or
delayed) and Landlord in each instance in accordance with the terms of Article
15 of the Main Lease. If Landlord gives its consent to an assignment of this
Sublease or a further sublet of the Sublet Premises, or any part thereof,
Sublandlord shall consent to such assignment or sublease.

           12.        Deleted Prior to Execution

           13.        Attornment.

                                                      In the event of
termination, re-entry or dispossession of Sublandlord by Landlord under the Main
Lease, the Landlord may, at its option, take over all of the right, title and
interest of Sublandlord, as sublessor under this Sublease, and Subtenant shall,
at Landlord's option, attorn to Landlord pursuant to the then executory
provisions of this Sublease, except that Landlord shall not (i) be liable for
any previous act or omission of Sublandlord under this Sublease, which
heretofore has accrued to Subtenant against Sublandlord, (ii) be bound by any
previous modification of this Sublease not consented to by Landlord or by any
previous prepayment of more than one month's rent, (iii) be bound to perform any
work which Sublandlord is obligated to perform hereunder, or to pay Subtenant
for the same or (iv) be subject to any offset not expressly provided for in this
Sublease which theretofore accrued to Subtenant against Sublandlord. The
Subtenant hereunder hereby waives all rights under any present or future laws or
otherwise to elect, by reason of the termination of the Main Lease, to terminate
this Sublease or surrender possession of the Sublet Premises demised hereby.

 

           14.        Subtenant's Representation and Warranties

                                                      Subtenant covenants,
warrants and represents:

                                                      (a)         that Subtenant
shall perform all of its obligations under this Sublease (including, without
limitation, all of the obligations relating to the Sublet Premises arising under
the Main Lease which are incorporated herein by reference)

                                                      (b)        that Subtenant
will not do or omit to do anything which would constitute a default under the
provisions of the Main Lease incorporated herein by reference: and

                                                      (c)         that Subtenant
shall indemnify, defend and hold harmless Sublandlord and Landlord and their
respective agents, contractors and employees from and against any and all
claims, liabilities, damages, losses or expenses (including, without limitation,
reasonable attorneys' fees) which may be imposed upon or incurred by or asserted
against Sublandlord and/or Landlord and/or their respective agents, contractors
or employees by reason of (i) Subtenant's failure to comply with the provisions
of this Sublease, (ii) the negligent or improper use or occupancy of the Sublet
Premises by Subtenant or its successors or assigns, (iii) any work or thing done
whatsoever by or at the instance of Subtenant, its agents, contractors,
subcontractors, employees, licensees, successors or assigns (other than work
performed by Sublandlord), or any condition created by Subtenant, its agents,
contractors, subcontractors, employees, licensees, successors or assigns in, on
or about the Sublet Premises, (iv) any negligence or other wrongful act or
omission on the part of Subtenant or any of its agents, contractors,
subcontractors, employees, licensees, successors or assigns, or (v) any
accident, injury or damage to any person or property occurring in, on or about
the Sublet Premises or any part thereof, except to the extent caused by the
gross negligence or willful misconduct of Sublandlord (with respect to a claim
against Sublandlord) or Landlord (with respect to a claim against Landlord) In
case any action or proceeding is brought against Sublandlord and/or Landlord
and/or their respective agents and employees by reason of any such claim,
neither Sublandlord nor Landlord shall settle the same without Subtenant's
written consent and Subtenant, upon written notice from Sublandlord and/or
Landlord, shall at Subtenant's expense resist and defend such action or
proceeding by counsel approved by Sublandlord and/or Landlord in writing, which
approval will not be unreasonably withheld.

 

           15.        Estoppel.

                                                      Sublandlord represents
that (i) it has paid all rent and additional rent presently payable pursuant to
the Main Lease with respect to the Sublet Premises as of the date of this
Sublease, (ii) to its best knowledge, no event has occurred which is, or with
the giving of notice or passage of time or both will become, a condition of
limitation under the Main Lease, on the part of either Sublandlord or the
Landlord, (iii) it is currently the Tenant under the Main Lease, (iv) it has not
received any notices of default citing any defaults under the Main Lease which
remain uncured, and (v) the Main Lease, a copy of which has been examined by
Subtenant, represents the entire agreement with respect to the Sublet Premises
between the Landlord and the Sublandlord.

           16.        Security Deposit.

                                                      A.         Subject to the
provisions of Section 16B, Subtenant shall deposit with Sublandlord on or before
the date hereof, the sum of $226,050.00 (hereinafter referred to as the
"Security Deposit") as security for the full and punctual performance by
Subtenant of all the terms of this sublease. Such Security Deposit shall be
retained by Sublandlord in accordance with the provisions of this Article 16.
The security shall be deposited in a separate interest bearing account
segregated from Sublandlord's funds, in a bank selected by Sublandlord and any
interest earned thereon (less any administrative fee to which Sublandlord may be
entitled pursuant to applicable law) shall be paid to Subtenant annually
provided Subtenant is not then in default in the observance or performance of
any of its obligations under this lease which continues after notice and the
expiration of any applicable cure period. In the event Subtenant defaults in the
performance of any of the terms of this Sublease, including the payment of Fixed
Rent, Additional Rent, or any other sum owing by Subtenant hereunder which
continues after any required notice and the expiration of any applicable cure
period, Sublandlord may use, apply or retain the whole or any part of the
Security Deposit to the extent required for the payment of any Fixed Rent,
Additional Rent, or other sum or for any sum which Sublandlord may expend or may
be required to expend by reason of Subtenant's default in respect of any of the
terms of this Sublease, including any damages or deficiency in the re-letting of
the Sublease Premises, whether accruing before or after summary proceedings or
other re-entry by Sublandlord. In the case of every such use, application or
retention, Subtenant shall, on demand, pay to Sublandlord the sum so used,
applied or retained which shall be added to the Security Deposit so that the
same shall be replenished to its former amount. If Subtenant shall fully and
punctually comply with all of the terms of this Sublease, the Security Deposit,
with any interest earned thereon, shall be returned to Subtenant after the
termination of this Sublease and delivery of exclusive possession of the Sublet
Premises to Sublandlord (subject to the provisions of this Article). In the
event of an assignment of the Main Lease by Sublandlord or any attorment by
Subtenant to Landlord, Sublandlord shall have the right to transfer the Security
Deposit or any letter of credit provided for in this Article 16 to the assignee
or Landlord, as the case may be, and Sublandlord shall ipso facto be released by
Subtenant from all liability for the return of the Security Deposit or such
letter of credit; and Subtenant agrees to look solely to the new landlord for
the return of the Security Deposit or such letter of credit and it is agreed
that the provisions hereof shall apply to every transfer or assignment made of
the Security Deposit or the letter of credit to a new landlord. Subtenant shall
not assign or encumber or attempt to assign or encumber the monies or letter of
credit deposited herein as security and neither Sublandlord nor its successors
or assigns shall be bound by any such assignment, encumbrance, attempted
assignment or encumbrance.

                                                      B.          In lieu of a
cash deposit, Subtenant may deliver to Sublandlord a clean, irrevocable
transferable (without expense to the beneficiary thereof) and unconditional
Letter of Credit issued by and drawn upon any commercial bank which is a member
of the New York Clearing House Association (hereinafter referred to as the
"Issuing Bank" with offices for banking purposes in the City of New York and
having a net worth of not less than Five Hundred Million and 00/100
($500,0OO,000.00) Dollars, which Letter of Credit shall have a term of not less
than one year, be in form and content satisfactory to Sublandlord, be for the
account of Sublandlord and be in the amount of $226,050.00. The Letter of Credit
shall provide that:

                                                                    (i)         
The Issuing Bank shall pay to Sublandlord or its duly authorized representative
an amount up to the face amount of the Letter of Credit upon presentation of the
Letter of Credit and a sight draft in the amount to be drawn;

                                                                    (ii)        
The Letter of Credit shall be deemed to be automatically renewed, without
amendment, for consecutive periods of one year each during the term of this
Sublease, unless the Issuing Bank sends written notice (hereinafter referred to
as the "Non-Renewal Notice") to Sublandlord by certified or registered mail,
return receipt requested, not less than thirty (30) days next preceding the then
expiration date of the Letter of Credit, that it elects not to have such Letter
of Credit renewed;

 

                                                                    (iii)       
Sublandlord, within twenty (20) days of its receipt of the Non-Renewal Notice,
shall have the right, exercisable by a sight draft, to receive the monies
represented by the Letter of Credit (which moneys shall be held by Sublandlord
as a cash deposit pursuant to the terms of this Article 16 pending the
replacement of such Letter of Credit or Subtenant's default hereunder); and

                                                                    (iv)      
Upon Sublandlord's assignment of Sublandlord's interest in the Main Lease, the
Letter of Credit shall be transferable by Sublandlord as provided in Article 16A
hereof.

                                                      C.          Sublandlord
agrees that it will not draw down the proceeds of the Letter of Credit except in
the event of a default by Subtenant hereunder which continues after any required
notice and the expiration of any applicable cure period or the non-renewal of
such Letter of Credit by the Issuing Bank.

                                                      D.         In the event
that at any time during the term of this Sublease, Sublandlord, in Sublandlord's
reasonable opinion, believes (i) that the net worth of the Issuing Bank shall be
less than the minimum amount specified in Article 16B, or (ii) that
circumstances have occurred indicating that the Issuing Bank may be incapable
of, unable to, or prohibited from honoring the then existing Letter of Credit
(hereinafter referred to as the "Existing L/C") in accordance with the terms
thereof, then, upon the happening of either of the foregoing, Sublandlord may
send written notice to Subtenant (hereinafter referred to as the "Replacement
Notice") requiring Subtenant within ten (10) days to replace the Existing L/C
with a new letter of credit (hereinafter referred to as the "Replacement L/C")
from an Issuing Bank meeting the qualifications described in Article 16B. Upon
receipt of a Replacement L/C meeting the qualifications of Article 16B,
Sublandlord shall forthwith return the Existing L/C to Subtenant. In the event
that (a) a Replacement L/C meeting the qualifications of Article 16B is not
received by Sublandlord within the time specified or (b) Sublandlord reasonably
believes an emergency exists, then in either event, the Existing L/C may be
presented for payment by Sublandlord and the proceeds thereof shall be held by
Sublandlord in accordance with Section 16A subject, however, to Subtenant's
right, at any time thereafter prior to a Subtenant's default hereunder, to
replace such cash security with a new letter of credit meeting the qualificatons
of Article 16B.

                                                      E.          Subtenant
hereby advises Sublandlord that Republic National Bank shall be the original
Issuing Bank. Notwithstanding anything in this Article 16 to the contrary,
subject to the provisions of Section 16B hereof, Subtenant may, upon ten (10)
days' prior written notice to Sublandlord, request that the Existing L/C be
substituted with a new letter of credit (hereinafter referred to as the
“Substitution L/C") from an Issuing Bank meeting the qualifications described in
Section 16B. The Substitution L/C shall accompany said request. Upon receipt of
a Substitution L/C meeting the qualifications of Section 16B, Sublandlord shall
forthwith return the Existing L/C to Subtenant.

                                                      F.         
Notwithstanding anything in this Article 16 to the contrary, subject to the
provisions of Section 16G hereof, Subtenant may, upon notice to SublandLord
(hereinafter referred to as the “Security Reduction Notice") request that
Sublandlord return to Subtenant portions of the cash security deposited by
Subtenant pursuant to Section 16A so as to reduce the cash security to the
amounts set forth in Section 16G during the periods set forth in Section 16G or,
if Subtenant has provided a Letter of Credit, exchange the then existing Letter
of Credit for a new Letter of Credit or provide an amendment of the then
existing Letter of Credit reasonably acceptable to Landlord in the amounts set
forth in Section 16G and otherwise meeting the requirements of Section 16B.

                                                      G.          (i) Provided
Tenant is not in default under this Sublease, which default continues after
notice and the expiration of any applicable cure period, both on the date
Sublandlord receives the Security Reduction Notice and on the date reimbursement
is to be made to Subtenant or the existing Letter of Credit is to be exchanged
or the amendment is to be delivered to and accepted by Sublandlord, and
Sublandlord has not previously applied any such security in accordance with the
provisions of this Article 16 which has not been restored by Subtenant,
Sublandlord will return to Subtenant portions of the cash security so as to
reduce the cash security to the amounts set forth in such Section 16G(ii) below
during the periods set forth therein, or exchange the then existing Letter of
Credit for the new Letter of Credit or accept an amendment of such existing
Letter of Credit (which acceptance must be evidenced in writing by Landlord) as
set forth in Section 16F.

 

ii)   PERIOD AMOUNT OF SECURITY From the third (3rd) anniversary of the Sublease
Commencement Date to the day next preceding the fifth (5th) anniversary of the
Sublease Commencement Date, both dates inclusive $150,700.00     From the fifth
(5th) anniversary of the Sublease Commencement Date and thereafter $113,025.00

           17.        Brokers.

                                                      A.         Subtenant
represents that Subtenant has dealt with no brokers other than Broadwall
Brokerage and Consulting Inc. and Cushman & Wakefield, Inc. (hereinafter
collectively referred to as the "Broker") in connection with this transaction.
Subtenant shall indemnify and hold Sublandlord and Landlord harmless from and
against any and all claims, liabilities, costs and expenses of any kind and
nature (including reasonable attorneys' fees) arising from or related to a
breach of the foregoing representation.

                                                      B.          Sublandlord
represents that it has dealt with no brokers in connection with this transaction
other than the Broker. Sublandlord shall indemnify and hold Subtenant and
Landlord harmless from and against any and all claims, liabilities,costs and
expenses of any kind and nature (including reasonable attorneys' fees) arising
from or related to a breach of the foregoing representation and shall pay any
commission due in connection with this Sublease to the Broker pursuant to
separate agreement.

           18.        Landlord's Consent; Binding Effect.

                                                      Upon execution hereof,
this Sublease shall be delivered to the Landlord for its consent. Sublandlord
and Subtenant expressly acknowledge that the Landlord's consent is a condition
precedent to the effectiveness of this Sublease. Sublandlord and Subtenant agree
to use reasonable and diligent efforts to obtain the Landlord's consent hereto,
and shall execute and deliver such other and further instruments and/or deliver
such information as may reasonably be required to effectuate the intent of this
Sublease and/or to obtain the Landlord's consent to the subleasing of the
Premises to Subtenant. If, for any reason, the Landlord's consent to this
Sublease cannot be obtained within thirty (30) days after the date hereof,
Sublandlord and Subtenant shall each have the right, at any time after such 30th
day, but prior to the date upon which the consent of the Landlord is obtained,
to cancel this Sublease by serving written notice to the other party, and, in
such event, (i) the parties hereto shall be released, (ii) all sums paid by
Subtenant hereunder shall be returned to Subtenant and (iii) neither party
hereto shall have any further liability to the other arising out of this
transaction.

Notwithstanding anything to the contrary contained in this Sublease, this
Sublease shall not become effective until both Sublandlord and Subtenant execute
this Sublease and until Landlord's consent to this Sublease is obtained as
provided above.

             19.        Nonliability for Landlord's Failure to Consent;
Disclaimer of Liability.

                                                      In any instance where the
consent of Landlord is required hereunder or under the Main Lease, Sublandlord
shall have no liability for any failure of Landlord to grant its consent for any
reason whatsoever, including whether or not Landlord's consent was unreasonably
withheld. Except as otherwise expressly provided herein, in any case where
Landlord reserves a right or disclaims any liability under the Main Lease, said
right or disclaimer shall inure to the benefit of Sublandlord as well as to
Landlord, and any rights or disclaimers inuring to Sublandlord as tenant under
the Main Lease shall likewise inure to the benefit of Subtenant.

 

             20.        Sublandlord's Performance Under Main Lease.

                                                      A.         Sublandlord
will duly observe and perform every term and condition of the Main Lease to the
extent that such term and condition is not provided in this Sublease to be
observed or performed by Subtenant including, without limitation, Sublandlord's
obligation to pay Fixed Rent and Additional Rent to Landlord (and except to the
extent that any failure so to pay or any failure in such observance or
performance shall have resulted, directly or indirectly,  from any default by
Subtenant in its obligations to pay any amount of the Fixed Rent or Additional
Rent hereunder or to observe or perform any of the terms, covenants or
conditions in this Sublease or in the Main Lease on Subtenant's part to observe
or perform with respect to the Sublet Premises) Upon Subtenant's written
request, which shall not exceed four (4) times in a given year during the term
of this Sublease, Sublandlord shall provide Subtenant with a copy of its check
or other indicia of proof that Sublandlord has paid its Fixed Rent or Additional
Rent to Landlord.

                                                      B.          Sublandlord
shall not enter into any modification or amendment to or of the Main Lease, or
any other agreement, or take any other action which results in the modification,
surrender or cancellation of the Main Lease, if such modification, surrender or
cancellation decreases any of Subtenant's rights under  this Sublease, or
increases any of Subtenant's obligations or remedies under this Sublease,
without the prior written consent of Subtenant. Any modification, amendment,
agreement, surrender or cancellation made without such consent shall have no
effect on the rights or obligations of the Subtenant under this Sublease.

           21.        Sublandlord's Representation and Warranties.

                                                      Sublandlord covenants,
warrants and represents:

                                                                    (a)        
that Sublandlord shall indemnify, defend and hold harmless Subtenant and its
respective agents, contractors and employees from and against  any all claims,
liabilities damages, losses or expenses (including, without limitation,
reasonable attorneys’ fees) which may be imposed upon or incurred by or asserted
against Subtenant and/or its respective agents, contractors or employees by
reason of (i) Sublandlord's failure to comply with the provisions of this
Sublease or (ii) any negligence or other wrongful  act or omission on the part
of Sublandlord or any of its agents, contractors, subcontractors, employees,
licensees, successors or assigns. In case any action or proceeding is brought
against Subtenant and/or its respective agents and employees by reason of any
such claim, Subtenant shall not settle the same without Sublandlord's written
consent and Sublandlord, upon written notice from Subtenant, shall at
Sublandlord's expense resist and defend such action or proceeding by counsel
approved by Subtenant in writing, which approval will not be unreasonably
withheld; and

                                                                    (b)       
that Landlord has not charged Sublandlord for additional costs with respect to
Landlord's removal of Sublandlord's refuse and rubbish from the Demised
Premises.

           22.        Notices.

                                                      All notices, requests,
demands, and other communications hereunder shall be in writing, shall be
delivered personally or sent by registered or certified mail, return receipt
requested, or by nationally recognized overnight carrier providing for receipted
delivery and shall be deemed have been given or made when received at the
following address:

 

  If to Sublandlord:   30 South Pearl Street   Albany, New York 12205  
Attention: General Counsel       If to Subtenant:   At the address first set
forth above   Attention: Rory Cutaia       If to Landlord:   730 Third Avenue  
New York, New York 1007   Attention:Mr. Richard J. Usas   with copies to Mr.
Joseph Flanagan   and Elliot A. Stultz, Esq

             Any of the above addresses may be changed on ten (10) days
notice, given as above provided.

           23.        Insurance.

                                                      Subtenant shall maintain
all insurance required of Sublandlord as tenant in accordance with and pursuant
to the Main Lease, which insurance shall name both Landlord and Sublandlord as
additional insureds.

           24.        Entire Agreement.

                                                      This Sublease contains the
entire agreement between Sublandlord and Subtenant with respect to the subject
matter hereof. This Sublease cannot be changed in any manner except by a written
agreement signed by Sublandlord and Subtenant, and, if required, consented to by
Landlord.

           25.        New York Law.

                                                      This Sublease shall be
governed in all respects by the laws of the State of New York.

           26.        Successors and Assigns.

                                                      The provisions of this
Sublease, except as herein otherwise specifically provided, shall extend to,
bind and inure to the benefit of the parties hereto and their respective case of
Sublandlord, assigns. In the event of any assignment or transfer of the
leasehold estate under the Main Lease the transferor or assignor, as the case
may be, shall be and hereby is entirely relieved and freed of all obligations
under this Sublease.

 

             IN WITNESS WHEREOF, this Sublease has been duly executed as of the
date first set forth above.

  SUBLANDLORD:   FIRST ALBANY COMPANIES INC.       By: Stephen Wink      
SUBTENANT:       CONNECTECH,llc D/B/A TELX       By: Rory Cutaia      
SUBTENANT’S EMPLOYER IDENTIFICATION   NO. 11-3292120