EX-10.12



 Exhibit 10.12 
 SEVENTH LEASE MODIFICATION AGREEMENT 
 AGREEMENT made as of March 1,
2000, by and between 60 EAST 42ND ST. ASSOCIATES, a co-partnership having its office at 60 East 42nd Street, New York, New York 10165 (hereinafter called “Landlord”), and LINCOLN BUILDING ASSOCIATES, a co-partnership having its office at
60 East 42nd Street, New York, New York 10165 (hereinafter called “Tenant”). 
 W I T N
E S S E T H: 
 WHEREAS, the parties are respectively the current
landlord and tenant under that certain lease dated October 1, 1958, as modified by agreements dated January 1, 1964, as of January 1, 1977, as of April 1, 1979, as of April 1, 1981, as of April 1, 1982 and as of
October 1, 1987 (the “Lease”), covering premises known as and by the street numbers 60 East
42nd Street and 301 Madison Avenue, New York, New York
(the “Building”); and 
 WHEREAS, a modernization program is necessary to maintain the competitive position of the
Building; and 
 WHEREAS, Landlord is willing to make funds available for improvements required by such program, and Tenant is
willing to apply such funds, as agent for Landlord, to the making of such improvements, and to apply additional funds from the operation of the Building to pay for the balance of the costs of such improvements; and 

WHEREAS, Landlord and Tenant desire to modify the Lease as hereinafter set forth. 

NOW, THEREFORE, in consideration of mutual covenants herein contained, the parties hereto, intending to be bound, hereby agree as
follows: 
 1. Landlord and Tenant agree that improvements substantially as shown on Exhibit A attached hereto and made a part
hereof constitute the modernization program (the “Improvement Program”) referred to herein and shall be substantially made to the demised premises. All work performed by Tenant in furtherance of the Improvement Program shall be done as
agent for Landlord and for the account of Landlord, and when completed, shall become the property of Landlord. 
 2. Landlord
agrees to obtain a loan in the amount of $27,979,186.47 secured by a second mortgage (the “Second Mortgage”) on the demised premises. Pursuant to the terms of the Second Mortgage, loan proceeds shall be advanced in stages. Advances of loan
proceeds shall be deposited by Landlord in an interest-bearing money market or similar account and disbursed to Tenant upon submission of documents reasonably required by Landlord. For purposes of determining Additional Rent and Further Additional
Rent, all interest earned on amounts so held by Landlord and disbursed to Tenant shall be treated as income of Tenant. In the event that the Second Mortgage proceeds are insufficient to pay for the entire cost of the Improvement Program, Tenant
agrees the pay for the balance of such costs. 

  
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 3. Paragraph 2A(ii) of the Lease is hereby deleted in its entirety and replaced by the
following: 
 “(ii) Commencing on March 1, 2000, Tenant covenants to pay, in advance, on the first day of each month
during the term of this Lease and any renewal term of this Lease, a basic rent (hereinafter called “Basic Rent”) at an annual rate equal to (i) $24,000 plus (ii) the constant installment payments of interest and amortization
(excluding any balloon principal payment due at maturity) payable during such year under all mortgages to which this Lease is subordinate pursuant to Paragraph 30 hereof. The Basic Rent shall be adjusted on a dollar-for-dollar basis by changes in
the annual debt service on such mortgages. It is further understood and agreed that the amount of Basic Rent shall be adjusted upon a refinancing of any Mortgage (as defined in Paragraph 30), subject to and in accordance with the provisions of
Paragraph 30.” 
 4. Paragraph 13 of the Lease is hereby deleted in its entirety and replaced by the following: 

“13. Tenant agrees that its rights hereunder are subordinate to: 

 

	 	(i)	the mortgage(s) presently encumbering the demised premises; and 

  

	 	(ii)	any future mortgages placed on the demised premises provided that (a) the aggregate principal balance of all mortgages now or hereafter placed on the demised
premises does not exceed $40,000,000 plus refinancing costs, (b) such new mortgages are made by an institutional lender on a non-recourse basis and (c) the proceeds of the loan(s) secured by any new mortgage(s) are (i) used to
refinance the then existing mortgage(s) on the demised premises, (ii) pay refinancing costs in connection therewith and/or (iii) building improvements in connection with the demised premises. 


(Each mortgage to which Tenant’s rights hereunder are subordinate is hereinafter a “Permitted Mortgage”). Tenant agrees to
execute, upon demand, any documents required to evidence such subordination. Tenant further agrees that it will not do or suffer to be done any act upon the demised premises which will violate any of the terms of any Permitted Mortgage or the
obligations secured thereby.” 

  
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 5. Subject to the provisions of Paragraph 2 hereof, any costs, fees and expenses incurred in
connection with the execution of this Agreement or the completion of the transactions contemplated herein, shall be paid from proceeds advanced under the Second Mortgage. Any such costs, fees, and expenses paid by Tenant from sources other than the
loan secured by the Second Mortgage may be deducted in the year expended in calculating Tenant’s net income for purposes of determining Additional Rent and Further Additional Rent under the Lease. 

6. Paragraph 30 of the Lease is hereby deleted in its entirety and replaced by the following: 

“30. For the purpose of this Paragraph 30, the term “Mortgage” shall mean any fee mortgage to which the Lease is
subordinate under the provisions of Paragraph 13 of this Lease, and the term ‘refinancing’ shall include any consolidation, modification, renewal, extension or replacement thereof. In the event that there shall be one or more refinancings
of any Mortgage or in the event that the monthly debt service payments under any Mortgage shall be adjusted pursuant to the terms thereof, the annual Basic Rent will be modified to equal to the sum of TWENTY-FOUR THOUSAND DOLLARS ($24,000.00) plus
an amount equal to the constant installment payments for interest and amortization (not including any balloon principal payment due at maturity) required annually under all Mortgages.” 

7. Capitalized terms used and not otherwise defined herein shall have the respective meanings ascribed thereto in the Lease. 

8. Except as herein modified and as otherwise agreed between Landlord and Tenant, the Lease shall remain in full force and effect, and
the parties hereby ratify and confirm all of the other terms, covenants and conditions thereof. 
 9. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective legal representatives, successors and assigns. 

  
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 IN WITNESS WHEREOF, the parties hereto have hereunto set their hands as of the day and year
first above written. 
  

			
	Landlord:
	
	60 EAST 42ND ST. ASSOCIATES
		
	By:	 	 /s/ Thomas N. Keltner, Jr.

		 	Name: Thomas N. Keltner, Jr.
		 	Title:   Partner
	
	Tenant:
	
	LINCOLN BUILDING ASSOCIATES
		
	By:	 	 /s/ Peter L. Malkin

		 	Name: Peter L. Malkin
		 	Title:   Partner



  
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 Exhibit A 
 Lincoln Building – 60 East 42nd Street 
 Building Improvement Program

  

					
	 Project/Item
	  	Budget	 
	 Elevator system modernization
	  	$	2,800,000	  
	 Elevator cab replacement
	  	 	625,000	  
	 New concierge desk
	  	 	285,000	  
	 Public corridors and elevator lobbies upgrades
	  	 	4,234,000	  
	 New public bathrooms
	  	 	3,196,000	  
	 Lobby retail arcade upgrades, new awning & displays
	  	 	95,000	  
	 Façade renovation
	  	 	750,000	  
	 New marketing center
	  	 	500,000	  
	 New conference center
	  	 	300,000	  
	 Law library upgrades
	  	 	375,000	  
	 New cardkey & security system
	  	 	130,000	  
	 Roof & parapet replacements
	  	 	1,545,000	  
	 Water riser replacement
	  	 	2,353,000	  
	 New stairwell lighting & signage
	  	 	150,000	  
	 Misc. electrical & mechanical system upgrades
	  	 	685,000	  
	 Window replacement
	  	 	4,000,000	  
	 HVAC in corridors
	  	 	3,000,000	  
	 Misc. HVAC upgrades
	  	 	290,000	  
	 ACM abatement and re-insulation
	  	 	621,000	  
	 Misc. plumbing upgrades
	  	 	205,000	  
	 Class “E” upgrade
	  	 	150,000	  
	 Mortgage taxes and loan soft costs
	  	 	1,115,000	  
	 Contingency
	  	 	500,000	  
		  	  
	  
	 
	 Total
	  	$	27,904,000	  


  
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