Exhibit 10.10


 


LEASE


 


Between


 


HENRY HUDSON HOLDINGS LLC,


a Delaware limited liability
company,


 


Landlord,


 


and


 


HUDSON LEASECO LLC,


a New York limited liability
company,


 


Tenant.


 


Dated: August 28, 2000


 





















 


Lease


 


TABLE OF
CONTENTS


 


	
  Article

  	
  Page

  
	
   

  	
  1

  
	
  ARTICLE 1 GRANT OF LEASE; PREMISES

  	
  3

  
	
  ARTICLE 2 TERM; POSSESSION

  	
  3

  
	
  ARTICLE 3 BASE RENT

  	
  6

  
	
  ARTICLE 4 IMPOSITIONS

  	
  8

  
	
  ARTICLE 5 USE OF PREMISES

  	
  9

  
	
  ARTICLE 6 UTILITIES AND SERVICES; OPERATING
  EXPENSES; FINANCING DOCUMENTS

  	
  10

  
	
  ARTICLE 7 CONDITION AND CARE OF PREMISES 

  	
  13

  
	
  ARTICLE 8 RETURN OF PREMISES

  	
  15

  
	
  ARTICLE 9 HOLDING OVER

  	
  15

  
	
  ARTICLE 10 COMPLIANCE BY TENANT

  	
  15

  
	
  ARTICLE 11 RIGHTS RESERVED TO LANDLORD

  	
  16

  
	
  ARTICLE 12 MAINTENANCE

  	
  16

  
	
  ARTICLE 13 ALTERATIONS

  	
  17

  
	
  ARTICLE 14 ASSIGNMENT AND SUBLETTING

  	
  19

  
	
  ARTICLE 15 WAIVER OF CERTAIN
  CLAIMS; INDEMNITY BY TENANT

  	
  20

  
	
  ARTICLE 16 DAMAGE OR DESTRUCTION
  BY CASUALTY

  	
  21

  
	
  ARTICLE 17 EMINENT DOMAIN

  	
  22

  
	
  ARTICLE 18 DEFAULT

  	
  26

  
	
  ARTICLE 19 SUBORDINATION

  	
  27

  
	
  ARTICLE 20 MORTGAGEE PROTECTION

  	
  28

  
	
  ARTICLE 21 ESTOPPEL CERTIFICATE

  	
  28

  
	
  ARTICLE 22 SUBROGATION AND
  INSURANCE

  	
  30

  
	
  ARTICLE 23 NONWAIVER

  	
  30

  
	
  ARTICLE 24 TENANT CORPORATION,
  PARTNERSHIP OR LIMITED LIABILITY COMPANY

  	
  31

  
	
  ARTICLE 25 REAL ESTATE BROKERS

  	
  31

  
	
  ARTICLE 26 NOTICES

  	
  31

  



 





















 


	
  ARTICLE 27
  HAZARDOUS SUBSTANCES

  	
  31

  
	
  ARTICLE 28 TITLE AND
  COVENANT AGAINST LIENS

  	
  35

  
	
  ARTICLE 29
  MISCELLANEOUS

  	
  36

  
	
  ARTICLE 30
  EXCULPATORY PROVISIONS

  	
  38

  
	
  ARTICLE 31
  SUBLEASE OF THE tenth FLOOR LEASE AND THE GROUND FLOOR LEASE

  	
  39

  



 


	
  Exhibits:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBIT A

  	
  Legal
  Description of the Premises

  	
   

  
	
  EXHIBIT B

  	
  Subleases

  	
   

  
	
  EXHIBIT C

  	
  Operating
  Contracts

  	
   

  
	
  EXHIBIT D

  	
  Master
  Leases and Condominium Documents

  	
   

  
	
  EXHIBIT E

  	
  Certain
  Improvements to the Premises (Landlord’s Work)

  	
   

  
	
  EXHIBIT F

  	
  Tenth
  Floor Lease

  	
   

  
	
  EXHIBIT G

  	
  Ground
  Floor Lease

  	
   

  
	
  EXHIBIT H

  	
  Allocation
  of Base Rent to Personal Property

  	
   

  



 


ii





















 


LEASE


 


THIS LEASE is
made and entered into as of the 28th day of August, 2000, by and between HENRY
HUDSON HOLDINGS LLC, a New York limited liability company (hereinafter referred
to as “Landlord”), and HUDSON LEASECO LLC, a
New York limited liability company (hereinafter referred to as “Tenant”).


 


ARTICLE 1


 


GRANT OF LEASE; PREMISES


 


1.1           Landlord hereby leases to Tenant, and Tenant
hereby leases from Landlord, the premises commonly known as the Hudson Hotel
(the “Property”) in New York, New York,
legally described in Exhibit A attached hereto and made a part
hereof and shortly to be operated as a hotel, including, but not limited to,
that certain (i) Lease, dated February 11, 1999 (the “Tenth Floor Lease”), between Irving Schatz and Ian Schrager
Hotels LLC (f/k/a West 57th LLC), and (ii) Lease, dated as of January      ,
1999 (the “Ground Floor Lease”), by and among
Adrienne Schatz and Cheryl Hirsch, as landlord and Henry Hudson Holdings LLC, as
tenant, as amended by that certain Amendment to Lease, dated as of September 30,
1999 by and among Adrienne Schatz and Cheryl Hirsch, as landlord and Henry
Hudson Holdings LLC, as tenant (the Tenth Floor Lease and the Ground Floor
Lease hereinafter sometimes referred to as the “Master
Leases”), plus additional commercial space, together with all
improvements and personal property now located thereon or to be located thereon
during the Term (as hereinafter defined), together with all appurtenances,
easements, rights of way and other rights belonging to or in any way pertaining
to the said premises (such real estate, improvements, personal property,
appurtenances, easements, rights of way and other rights hereinafter referred
to as the “Premises”).


 


1.2           The Premises are owned in part and leased in
part by Landlord and are currently subject to (i) financing arrangements
with mortgage lenders secured by encumbrances upon the Premises (the “Financing Documents”), (ii) a Property Management
Agreement with Ian Schrager Hotel Management LLC (the “Hotel Management
Agreement”), (iii) leases or occupancy rights to various users
of portions of the Premises including various residential tenants that are
occupying rooms in the Premises pursuant to New York law (the “Subleases”), (iv) rights of lessors of a portion of
the Premises (the “Master Leases”),
(v) documents governing the condominium of which the Premises are a part
(the “Condominium Documents”) and (vi) various
contracts relating to the operation of the Premises, including, without
limitation, an elevator maintenance contract and a telephone maintenance
contract (the “Operating Contracts”). The
Financing Documents, the Hotel Management Agreement, the Subleases, the Master
Leases, the Condominium Documents and the Operating Contracts have been
previously


 





















 


delivered
to Tenant by Landlord and all but the Financing Documents have been or are
being assumed by Tenant (or subleased, in the case of the Master Leases).
Tenant has been provided with, and has had an opportunity to review, such
instruments and other materials relating to the legal, financial and physical
conditions of the Premises.


 


1.3           In addition, concurrently with the execution of
this Lease the parties are executing an HTC Loan Agreement and other documents
dated as of even date herewith by and between Landlord and Tenant relating to a
loan from Tenant to Landlord and certain additional covenants and agreements as
between the parties thereto (the “HTC Loan Documents”).


 


1.4           Landlord represents to Tenant that prior to the
date hereof Landlord has entered into the Subleases listed on Exhibit B
hereto.  Landlord hereby assigns to
Tenant all its right, title and interest in and to each of such Subleases and Tenant
hereby assumes all of the obligations of the landlord under each of those Subleases,
in each case effective as of August 28, 2000.  Landlord hereby represents to Tenant that no
defaults exist under any of such Subleases and that all consents and notices
necessary for the assignment and assumption described in this paragraph have
been obtained.  Landlord further
represents to Tenant that no leases exist with respect to the Premises other
than those listed on Exhibit B hereto.


 


1.5           Landlord represents to Tenant that prior to the
date hereof Landlord has entered into the Operating Contracts listed on Exhibit C
hereto.  Landlord hereby assigns to
Tenant all its right, title and interest in and to each of such Operating Contracts
and Tenant hereby assumes all of the obligations of the landlord under each of
those Operating Contracts, in each case effective as of August 28, 2000.
Landlord hereby represents to Tenant that no defaults exist under any of such
Operating Contracts and that all consents and notices necessary for the
assignment and assumption described in this paragraph have been obtained.


 


1.6           Landlord represents to Tenant that prior to the
date hereof Landlord has entered into the two Master Leases and the Condominium
Documents listed on Exhibit D hereto.  Pursuant to Article 31 of this Lease,
Landlord sublets to Tenant all its right, title and interest in and to each of
such Master Leases and Tenant assumes all of the obligations of the Landlord
under each of those Master Leases, effective as of August 28, 2000.  Tenant agrees to comply with all the
provisions of the Condominium Documents and to pay all assessments demanded of
the owner of Units 1, 2, 4, and 6 thereunder so long as this Lease remains in
effect.  Landlord hereby represents to
Tenant that no defaults exist under any of such Master Leases and Condominium
Documents and that all consents and notices necessary for the transactions
described in this paragraph have been obtained.


 


2





















 


ARTICLE 2


 


TERM; POSSESSION


 


2.1           Term.  The
term of this Lease (hereinafter referred to as the “Term”)
shall commence on August 28, 2000 (hereinafter, as the same may be adjusted
as hereinafter provided, referred to as the “Commencement
Date”) and end on December 31, 2035 (hereinafter, as the
same may be adjusted as hereinafter provided, referred to as the “Expiration Date”), unless sooner terminated as provided
herein.


 


2.2           Lease Year Defined.  As
used in this Lease, the term “Lease Year” shall
mean (i) if the Commencement Date is the first day of a calendar month,
the twelve (12) month period commencing on the Commencement Date or (ii) if
the Commencement Date is not the first day of a calendar month, the period
commencing on the Commencement Date and ending on the last day of the twelfth (12th)
full calendar month of the Term, and, in either case, each succeeding twelve
(12) month period thereafter which falls in whole or in part during the Term.


 


2.3           Landlord’s Termination Option.  Notwithstanding
the aforesaid Term, in the event of a sale or other direct or indirect transfer
of Landlord’s entire interest in the Premises, Landlord shall have the right to
terminate this Lease upon the giving of notice thereof in writing to Tenant (“Lease Termination Notice”). The termination of the Lease
shall be effective sixty (60) days from and after the giving of the Lease
Termination Notice provided that Landlord shall have made to Tenant on or
before the effective date of termination a payment (the “Lease Termination
Payment”) equal to Sixteen Million Dollars ($16,000,000), which amount
shall be reduced by Two Million Dollars ($2,000,000) on each of the first five anniversaries
of the Commencement Date and by Two Hundred Thousand Dollars ($200,000) on each
subsequent anniversary of the Commencement Date.


 


ARTICLE 3


 


BASE RENT


 


3.1           Base Rent.  Tenant
shall pay an annual base rent (hereinafter referred to as “Base Rent”)
to Landlord for the Premises per Lease Year, in the amounts set forth below,
payable in equal monthly installments (hereinafter referred to as “Monthly Base Rent”) payable on the first day of each month:


 


3





















 


	
  Lease Year Ending

  	
   

  	
  Annual Amount

  
	
   

  	
   

  	
   

  
	
  December 31, 2000 (5 months)

  	
   

  	
  $4,500,000 (5 months)

  
	
   

  	
   

  	
   

  
	
  December 31, 2001

  	
   

  	
  $21,000,000

  
	
   

  	
   

  	
   

  
	
  December 31, 2002

  	
   

  	
  $26,100,000

  
	
   

  	
   

  	
   

  
	
  December 31, 2003

  	
   

  	
  $28,700,000

  
	
   

  	
   

  	
   

  
	
  December 31, 2004

  	
   

  	
  $30,400,000

  
	
   

  	
   

  	
   

  
	
  December 31, 2005

  	
   

  	
  $32,100,000

  
	
   

  	
   

  	
   

  
	
  December 31, 2006

  	
   

  	
  $33,800,000

  
	
   

  	
   

  	
   

  
	
  December 31, 2007

  	
   

  	
  $36,300,000

  
	
   

  	
   

  	
   

  
	
  December 31, 2008

  	
   

  	
  $39,000,000

  
	
   

  	
   

  	
   

  
	
  December 31, 2009

  	
   

  	
  $41,800,000

  
	
   

  	
   

  	
   

  
	
  December 31, 2010

  	
   

  	
  $43,000,000

  
	
   

  	
   

  	
   

  
	
  Thereafter

  	
   

  	
  $45,000,000+

  
	
   

  	
   

  	
  annual CPI adjuster

  



 


3.2           Manner of Payment.  Subject
to Section 3.3, Base Rent and Tenant’s Share of Impositions (as
hereinafter defined) and all other amounts becoming due from Tenant to Landlord
hereunder (hereinafter collectively referred to as “Rent”)
shall be paid in lawful money of the United States to Landlord at the office of
Landlord, or as otherwise designated from time to time by written notice from Landlord
to Tenant.  On November 1, 2000,
Tenant shall pay Landlord Monthly Base Rent for the first partial calendar
month of the Term together with Monthly Base Rent for the months of September,
2000 through November, 2000.


 


3.3           Accrual of Rent.  To the
extent that on any date when Rent is due, Tenant has insufficient funds
available for the payment of any component of the Rent due on such date, such
Rent shall accrue and not be payable on such payment date but shall be payable
out of next available funds of Tenant; provided, however, Tenant shall not pay
any incentive management fees nor make any cash distributions to its Managing
Member unless and until all Rent payments due as of such time have been paid.  Notwithstanding anything to the contrary
contained herein, such accrual of Rent shall not constitute a Default
hereunder.  Any accrued Rent shall be due
in full at the end of the Term, whether upon expiration or earlier termination
of this Lease.


 


4





















 


3.4           Net Lease.  This
Lease is what is commonly called a “net lease,” it being understood that
Landlord shall receive the Rent set forth in Paragraph 3.2 hereof free and
clear of any and all other Impositions (as defined in Section 4.2 below),
taxes, assessments, liens, charges or expenses of any nature whatsoever in
connection with the ownership, maintenance, repair and operation of the
Premises, except as otherwise provided herein.  Tenant shall be solely responsible for and
shall pay all Impositions, insurance premiums, operating charges, maintenance
charges, construction costs, rental under equipment or similar leases, rent
under the Master Leases, assessments under the Condominium Documents, and any other
charges, costs and expenses which arise or may be contemplated under any
provisions of this Lease during the Term.  All of such charges, costs and expenses when
due shall constitute additional rent (“Additional Rent”),
even though not necessarily payable to Landlord, and upon the failure of Tenant
to pay any of such costs, charges or expenses, Landlord shall have the same
rights and remedies as otherwise provided in this Lease for the failure of
Tenant to pay Rent.  Rent, Additional
Rent and all other sums payable hereunder by Tenant shall be paid (except as
otherwise provided for herein) without notice or demand and without setoff,
counterclaim, abatement, suspension, deduction or defense.  Nothing herein contained shall obligate Tenant
for the payment of any expenses payable by Landlord pursuant to Section 6.4
hereinbelow or any income or franchise taxes payable by Landlord under
applicable law.


 


3.5           No Termination.  Except
as otherwise expressly provided herein, this Lease shall not terminate, nor
shall Tenant have any right to terminate this Lease, nor shall Tenant be
entitled to any abatement or reduction of Rent hereunder, nor shall the
obligations of Tenant hereunder be affected, by reason of any default on the
part of Landlord under this Lease, or under any other agreement to which
Landlord and Tenant may be parties; provided, however, that in the event that
Landlord is in breach of its covenant to repay the HTC Loan (as that term is
hereinafter defined), which breach is continuing ten (10) days after
notice from Tenant to Landlord, Tenant may apply amounts otherwise payable by
it pursuant to Section 3.1 or 3.2 (and not required to be used by Landlord
for payment of debt service under the Financing Documents, or the financing
documents delivered by Landlord in connection with any replacement financing)
to cure such breach.  It is the intention
of the parties hereto that the obligations of Tenant hereunder shall be
separate and independent covenants and agreements, that the Rent, and all other
sums payable by Tenant hereunder shall continue to be payable in all events and
that the obligations of Tenant hereunder shall continue unaffected, unless the
requirement to pay or perform the same shall have been terminated pursuant to
an express provision of this Lease.  Nothing
herein shall preclude Tenant from pursuing or realizing upon its other remedies
at law or in equity by reason of any default hereunder by Landlord.


 


Tenant agrees that it will remain obligated under this Lease in
accordance with its terms, and that it will not take any action to terminate,
rescind or avoid


 


5





















 


this
Lease, notwithstanding (i) the bankruptcy, insolvency, reorganization,
composition, readjustment, liquidation, dissolution, winding up or other
proceeding affecting Landlord or any assignee of Landlord in any such
proceeding, and (ii) any action with respect to the Lease which may be
taken by any trustee or receiver of Landlord or of any assignee of Landlord in
any such proceeding or by any court in any such proceeding; provided that this
Lease is not effectively disaffirmed in such proceedings and Tenant receives
reasonable assurance thereof within a reasonable period of time following the
commencement of such proceedings.


 


Tenant waives all rights which may now or hereafter be conferred by law (i) to
quit, terminate or surrender this Lease or the Premises or any part thereof, or
(ii) to any abatement, suspension, deferment or reduction of Rent,
Additional Rent or any other sums payable under this Lease, except as otherwise
expressly provided herein.


 


3.6           HTC Loan.  In
addition to the Rent payable hereunder, Tenant shall advance, as additional
consideration for the making by Landlord of the Premises available to Tenant
under this Lease, to Landlord funds in the form of a loan (the “HTC Loan”) in accordance with the terms of the HTC Loan
Agreement dated of even date herewith between Tenant as lender and Landlord as
borrower.


 


ARTICLE 4


 


IMPOSITIONS


 


4.1           Obligation to Pay Tenant’s Share
of Impositions.  In addition to paying the Base Rent specified
in Article 3 hereof, Tenant, shall also pay Landlord, as additional rent,
the amounts determined in accordance with this Article 4 (hereinafter
referred to as “Tenant’s Share of Impositions”).


 


4.2           Payment by Tenant.  For
each calendar year during which any portion of the Term falls, Tenant shall pay
Landlord, as additional rent for the Premises, “Tenant’s
Share of Impositions.” For purposes hereof, Tenant’s Share of
Impositions for any such calendar year shall mean all Impositions for such
year.  The term “Impositions”
shall mean all taxes and assessments, general and special, water rates and all
other impositions, ordinary and extraordinary, of every kind and nature
whatsoever, which may be levied, assessed, charged or imposed during the Term
of the Lease upon the Premises, or any part thereof, or upon any improvements
at any time situated thereon, including, without limitation, any assessment by
any association of owners of property in the complex of which the Premises are
a part.  Impositions shall also include
fees and costs incurred by Landlord pursuant to Section 4.6 hereinbelow
during the Lease Term for the purpose of contesting or protesting tax
assessments or rates, to the extent such fees and costs relate to savings
anticipated by Landlord during the Term of the Lease.


 


6





















 


Impositions
“for” a given calendar year shall mean Impositions which are due for payment or
paid in such calendar year, regardless of when the same are assessed.


 


4.3           Alternative Taxes.  If at
any time during the Term the method of taxation prevailing at the commencement
of the Term hereof shall be altered so that any new tax, assessment, levy,
imposition or charge, or any part thereof, shall be measured by or be based in
whole or in part upon the Lease or the Premises or the Rent or additional rent
or other income therefrom, and shall be imposed upon the Landlord, then all
such taxes, assessments, levies, impositions or charges, or the part thereof,
to the extent that they are so measured or based, shall be deemed to be
included within the definition of Impositions for the purposes hereof to the extent
that such Impositions would be payable if the Premises were the only property
of Landlord subject to such Impositions, and Tenant shall pay and discharge the
same as herein provided in respect of the payment of Impositions.  There shall be excluded from Impositions all
federal, state and local net income tax, federal excess profit taxes, transfer,
franchise, capital stock and federal or state estate or inheritance taxes of
Landlord.


 


4.4           Estimates of Impositions.  Tenant’s
Share of Impositions for each calendar year during which any portion of the
Term falls shall be reasonably estimated by Landlord and shall be based upon
the most recently ascertainable assessment and tax rate levels, and written
notice of such estimate shall be given to Tenant prior to the beginning of each
such calendar year.  Tenant shall pay Landlord
each month, at the same time as the Monthly Base Rent payment is due, an amount
equal to one-twelfth (1/12) of said annual estimate of Tenant’s Share of Impositions.  In the event Landlord’s estimate of Tenant’s
Share of Impositions is not given to Tenant prior to the beginning of any
applicable calendar year, Tenant shall continue to pay to Landlord, in monthly
installments on account of Tenant’s Share of Impositions, such amount estimated
on the basis of the most current estimate by Landlord; provided, however, that
on the first day of the calendar month following the month in which Landlord
notifies Tenant of any change in such estimate, Tenant shall pay to Landlord a
lump sum equal to the estimated Tenant’s Share of Impositions as revised by
Landlord minus (a) any previous monthly installments on account thereof
made by Tenant for such calendar year and (b) any monthly installments on
account thereof which are not yet due and payable for the remainder of such
calendar year.  Thereafter, Tenant shall
pay Landlord monthly installments on account of Tenant’s Share of Impositions
based on the new revised estimate thereof given by Landlord.


 


4.5           Readjustments; Yearly Proration. Landlord shall deliver to Tenant a statement
showing the actual Tenant’s Share of Impositions for each calendar year as soon
as reasonably feasible after same are determined, together with a copy of any
tax bill or other evidence of the Impositions. 
Within thirty (30) days after delivery of such statement, Tenant shall
pay to Landlord or Landlord shall credit against the next Rent payment or
payments due from Tenant, as the case may be,


 


7





















 


the
difference between the actual Tenant’s Share of Impositions for such calendar
year and the sum of the monthly installments on account of Tenant’s Share of
Impositions paid by Tenant during such calendar year.  Tenant’s obligation to pay Landlord such
difference, if applicable, shall survive the expiration or termination of this
Lease.  If the Term commences on any day
other than the first day of January, or if the Term ends on any day other than
the last day of December, the Tenant’s Share of Impositions due Landlord for
such partial calendar year shall be prorated so that Tenant shall pay a prorata
share equal to said Tenant’s Share of Impositions multiplied by a fraction, the
numerator of which is the number of days of the Term falling within such
partial calendar year and the denominator of which is 365.


 


4.6           Right To Contest. 
Without limiting Tenant’s obligation to pay additional rent under this Article 4,
Tenant shall have the right, in good faith and with due diligence, to contest
the amount of Impositions or the validity thereof by appropriate legal
proceedings with the proper taxing authority or other body; provided that,
pending any such legal proceedings, Tenant shall give Landlord such security as
may be deemed reasonably satisfactory to Landlord to insure payment of the
amount of all Impositions or charges and all interest and penalties
thereon.  If, at any time during the
continuance of such contest, the Premises or any part thereof is, in the
reasonable judgment of Landlord, in danger of being forfeited or lost, Landlord
may use such security, together with Tenant’s monthly installments in account
of Tenant’s Share of Impositions, for the payment of such Imposition.  Tenant shall notify Landlord of its intent to
contest Impositions prior to initiating any such legal proceedings.  Landlord may hire counsel or other experts to
protect its rights in connection with the contesting by Tenant (or for its
account, if Tenant shall not contest the Impositions) as herein provided.


 


4.7           Representations and Warranties.  Tenant
agrees and acknowledges that Landlord has made no representation, warranty or
guaranty relating to the amount of the Impositions.  Tenant has had an opportunity to consult with
Landlord with respect to the Impositions projected for the operation of the
Premises but has not relied upon any statements or representations of Landlord
or any agent or affiliate of Landlord in regard thereto in executing this Lease
and agreeing to perform the terms and covenants hereof and shall make no claims
against Landlord based thereon.


 


ARTICLE 5


 


USE OF PREMISES


 


Tenant shall use and occupy the Premises for purposes of operation of a
hotel, together with ancillary facilities including one or more restaurants,
meeting rooms and similar facilities, as commercial rental property, and for
incidental uses thereto and for no other use or purpose.  Notwithstanding the foregoing, until such time
as


 


8





















 


Tenant
may legally require existing single-room occupancy tenants to vacate the space
in the Premises now occupied by them pursuant to various Subleases, Tenant may
continue to lease such occupants the space now occupied by them or may relocate
them within the Property.  Tenant
covenants and agrees to use and occupy the Premises in conformity with all
federal, state and municipal statutes, laws, rules, ordinances, regulations and
orders binding upon Tenant and the Premises, and in conformity with the Master
Leases, the Condominium Documents and the Financing Documents.  Tenant shall not use any materials which are
hazardous or toxic, nor shall Tenant create any offensive or toxic emissions or
effluents to emanate from the Premises, except to the extent reasonable or
appropriate in connection with the lawful use of the Premises in the ordinary
course of Tenant’s business, and Tenant shall comply with all legal
requirements in connection with such use.  At all times during the Term, Tenant shall
cause all such legal requirements to remain in compliance and, to the extent
that it should fail to do so beyond any applicable grace or cure period,
Landlord shall have the right to cause such requirements to remain in
compliance and the amount advanced on behalf of Tenant by Landlord on account
thereof shall constitute Additional Rent and shall accrue interest at the rate
set forth in Section 6.4.


 


ARTICLE 6


 


UTILITIES AND SERVICES;


OPERATING EXPENSES; FINANCING
DOCUMENTS


 


6.1           Utilities and Services.  Tenant
shall purchase all utility services, including, but not limited to, fuel,
water, sewerage and electricity, from the utility or municipality providing
such service, and shall pay for such services when such payments are due.


 


6.2           Regulations Regarding Utilities
and Services.  Tenant agrees to cooperate fully, at all
times, with Landlord in abiding by all reasonable regulations and requirements
which Landlord may prescribe for the proper functioning and protection of all
utilities and services reasonably necessary for the operation of the Premises.  Throughout the Term of this Lease, Landlord
and its contractors shall have reasonable access after reasonable advance
notice and in such manner as will minimize interference with the use and
occupancy of the Premises to any and all mechanical installations, and Tenant
agrees that there shall be no construction of partitions or other obstructions
which might interfere with access to or the moving of servicing equipment to or
from the enclosures containing said installations.  Tenant further agrees that neither Tenant nor
its employees, agents, licensees, invitees or contractors shall at any time
tamper with, adjust or otherwise in any manner affect Landlord’s mechanical
installations.


 


6.3           Operating Expenses. 
Without limitation of any other provision herein and except as otherwise
herein specified, Tenant shall pay all expenses of


 


9





















 


operation
of the Premises including, without limitation, all Impositions, insurance
premiums, operating changes, rents under the Master Leases, assessments under
the Condominium Documents, maintenance charges, construction costs and other
amounts, whether or not contemplated under this Lease.  It is specifically acknowledged and agreed
that Tenant shall be responsible for paying all amounts payable to the manager
under the Hotel Management Agreement.


 


6.4           Debt Service.  Nothing
contained herein shall obligate Tenant to pay any principal, interest,
prepayment premiums or other amounts in connection with the loans evidenced by
the Financing Documents, it being acknowledged that at all times the
responsibility for payment of such loans (or any replacements, accretions or additions
to such loans) shall remain the responsibility of Landlord.  In the event of the failure by Landlord to pay
any such debt-related payments, Tenant shall have the right to pay such amounts
on behalf of Landlord and Landlord shall be obligated to reimburse Tenant for
the costs thereof and, in addition, Tenant shall have the right to set off
against the next Rent payable hereunder such amounts as are advanced by Tenant
on behalf of Landlord hereunder, together with interest from the date advanced
until paid or set-off at the annual rate of one percent (1%) in excess of the
prime rate of interest published from time to time in The Wall Street
Journal, changing as and when said prime rate changes.


 


ARTICLE 7


 


CONDITION AND CARE OF PREMISES


 


7.1           Possession.  The
Premises constitute a part of a building (the “Building”)
that will be a “qualified rehabilitated building” within the meaning of Section 47
of the Internal Revenue Code of 1986, as amended (the “Code”).
Landlord is rehabilitating the Premises in a manner intended to qualify the
Building for the historic rehabilitation tax credit (the “Historic
Tax Credit”) described in Section 47 of the Code for buildings
first placed in service before 1936 that do not constitute “certified historic
structures,” and has agreed in the HTC Loan Documents to pass through the
Historic Tax Credit attributable to the Premises to Tenant in accordance with
the provisions of Section 50(d) of the Code.  The nature and scope of such rehabilitation
work is more specifically described on Exhibit E attached hereto.  The aforesaid work is sometimes herein
referred to as the “Landlord’s Work.”
Landlord agrees to cause such work to be substantially completed in a good and
workmanlike manner conforming to all applicable law in all material respects on
or prior to December 31, 2000 in a lien-free manner (landlord being
entitled, however, to contest such liens in any manner customary in the State
of New York). Other than as herein provided, Tenant acknowledges that no
promises have been made by Landlord to alter, remodel, improve, repair,
decorate or clean the Premises or any part thereof.  Tenant’s taking possession of the Premises or
any portion thereof, unless Tenant shall notify Landlord within twelve (12)
months thereafter of any defective or incomplete work (in which event


 


10





















 


Landlord
shall promptly remedy such work), shall be conclusive evidence against Tenant
that the portion of the Premises taken possession of, including any portion of
Landlord’s Work therein, was then in good order and satisfactory condition.


 


Following the completion of Landlord’s Work and throughout the Term of
this Lease, Landlord shall, from time to time, at the reasonable request of
Tenant, replace the Furniture, Fixtures and Equipment needed in the Premises to
maintain the quality and condition of the Premises as a first-class hotel.  Any dispute between the parties as to the
timing, cost or quality of the replacements shall be determined by mediation.


 


7.2           Tenant Obligations.  At its
sole cost and expense throughout the Term, Tenant shall (a) take good care
of the Premises; (b) keep the same in good order and condition; and (c) make
and perform all maintenance thereof and all necessary repairs thereto, interior
and exterior, structural and nonstructural, ordinary and extraordinary,
foreseen and unforeseen, of every nature, kind and description.  When used in this Section, the term “repairs”
shall include all necessary replacements, renewals, alterations, additions and
betterments.  All repairs made by Tenant
shall be at least equal in quality and cost to the original improvements and
shall be made by Tenant in accordance with all laws, ordinances and regulations
whether heretofore or hereafter enacted.  The necessity for or adequacy of maintenance
and repairs shall be measured by the standards which are appropriate for
improvements of similar construction and class, provided that Tenant shall in
any event make all repairs reasonably necessary to avoid any structural damage
or other damage or injury to the Improvements.


 


In particular, Landlord and Tenant acknowledge that as of the
Commencement Date, approximately 125 rooms in the Premises are occupied by
long-term residents pursuant to New York legal requirements.  Landlord and Tenant agree that following the
expiration of such tenancies, any and all repairs or improvements required with
respect to any such rooms to convert them to additional hotel rooms and the
decision as to when any conversion shall occur, shall be the responsibility of
Landlord and shall be paid for by Landlord.  Any depreciation allowed with respect to any
such improvements shall be Landlord’s.


 


The foregoing notwithstanding, any repairs which are capital
expenditures under the Code and which are made during the last three (3) years
of the Term shall not be required to be made, unless Landlord and Tenant agree
to an allocation of the costs thereof.  If
the parties cannot so agree, Landlord shall have the right to cause such
repairs to be made and the cost thereof shall be amortized over the useful life
thereof, as determined and in accordance with the Code, and Tenant shall pay as
Additional Rent its share of the costs thereof relating to the remainder of the
Term.  Tenant shall be entitled to the tax
benefits (including depreciation) attributable to repairs or capital
expenditures made by it hereunder.


 


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Except as expressly set forth herein, Landlord shall not be required to
furnish any services or facilities or to make any repairs or alterations in,
about or to the Premises or any improvements hereafter erected thereon.  Except as expressly set forth herein, Tenant
hereby assumes the full and sole responsibility for the condition, operation,
repair, replacement, maintenance and management of the Premises hereafter
erected thereon.


 


Tenant shall not do or suffer any waste or damage, disfigurement or
injury to the Premises, or to the fixtures or equipment therein, or permit or
suffer any overloading of the floors or other use of the improvements that
would place an undue stress on the same or any portion thereof beyond that for
which the same was designed.


 


7.3           Compliance With Rules and
Regulations; Compliance with Covenants.  Tenant shall at its sole cost
and expense:


 


(a)           Comply
with (i) all federal, state, county, municipal and other governmental and
quasi governmental statutes, laws, rules, orders, regulations and ordinances
affecting the Premises or any part thereof, or the use thereof, including compliance
with the requirements of the City of New York and the State of New York (and
any federal law to the extent applicable) relating to the operation of the
Premises as a hotel serving alcoholic beverages and food products, and further
including those which require the making of any structural, unforeseen or
extraordinary changes (except such changes in the nature of capital
expenditures as are described in the second paragraph of Section 7.2
hereinabove, which shall be made in accordance with the provisions of such
paragraph), whether or not any such statutes, laws, rules, orders, regulations
or ordinances which may be hereafter enacted involve a change of policy on the
part of the governmental body enacting the same, and (ii) all rules,
orders and regulations of the National Board of Fire Underwriters or other
bodies exercising similar functions in connection with the prevention of fire
or the correction of hazardous conditions, which apply to the Premises;
provided, however, that Tenant shall not be obligated to comply or cause the
Premises to comply with any of the foregoing unless Tenant’s use of the
Premises or the condition of the Premises shall cause a violation of clause (i) or
(ii) above.  Tenant shall comply
with the requirements of all policies of public liability, fire and other insurance
which at any time may be in force with respect to the Premises.


 


(b)           Comply
with the requirements (the “Covenants”) of
the Financing Documents, the Subleases, the Operating Contracts, the Master Leases,
the Condominium Documents and the Hotel Management Agreement, certain of which
shall be assigned to and assumed by Tenant concurrently with the execution of
this Lease or as soon thereafter as is practicable.  In the event of its failure to do so (without
limitation of any


 


12





















 


other rights or remedies of Landlord hereunder), Landlord may, if such
failure continues beyond the applicable grace period hereunder, pay such
amounts or perform such obligations as are necessary in order to comply
therewith.  The amounts reasonably
expended by Landlord on account thereof shall constitute Additional Rent.


 


7.4           Existing Equipment.  Tenant
acknowledges that Tenant is accepting possession of the Premises inclusive of
any and all equipment, personal property, furniture, fixtures, equipment and
other moveable items (collectively, the “Existing Equipment”)
currently located therein.  Landlord
makes no representations or warranties, whatsoever, as to the condition of said
Existing Equipment, or as to Landlord’s title or interest with respect
thereto.  In the event that the Existing Equipment
is removed, whether by Tenant or any other party, during or at the end of the
Term hereof, Tenant shall be responsible for restoring any and all damage to the
Premises caused by such removal, at Tenant’s sole cost and expense.  Tenant shall cause such Existing Equipment to
be replaced as and when necessary or required under the Hotel Management
Agreement or the Financing Documents.  Further,
Tenant shall indemnify Landlord and its respective employees, agents and other
representatives, from and against any and all cost, expenses, liens, damages, or
other claims resulting from the removal of any such Existing Equipment.


 


7.5           Tax Credits.  Except
as otherwise specifically provided in the HTC Loan Documents and in Section 7.1
or Section 7.2 hereof, Tenant expressly waives and relinquishes in favor
of Landlord any rights to claim the benefit of or to use any federal or state
investment tax credits or depreciation benefits that are currently or may
become, available during the Term as a result of the improvements constituting
part of the Premises, or any installation of the Existing Equipment or any
other equipment, furniture or fixtures installed by Landlord on the Premises whether
or not such items become a part of the realty, and Tenant agrees to execute and
deliver to Landlord any election form required to evidence Landlord’s right to claim
investment tax credits or depreciation benefits on improvements made or property
installed by Landlord.  Notwithstanding
the foregoing, to the extent Tenant is required to make improvements to the
Premises pursuant to this Lease, Landlord and Tenant agree that Tenant shall be
entitled to any investment tax credits or depreciation attributable to
improvements made by or property installed by Tenant and paid for by Tenant
following the Commencement Date.


 


ARTICLE 8


 


RETURN OF PREMISES


 


8.1           Surrender of Possession.  At the
termination of this Lease by lapse of time or otherwise or upon termination of
Tenant’s right of possession without termination of this Lease, Tenant shall
surrender possession of the Premises to Landlord and deliver all keys to the
Premises to Landlord and make known to


 


13





















 


Landlord
the combination of all locks of vaults then remaining in the Premises, and
shall, subject to the following paragraph, return the Premises and all
equipment and fixtures of Landlord therein to Landlord in as good condition as
when Tenant originally took possession, ordinary wear, loss or damage by fire
or other insured casualty, and damage resulting from the act of Landlord or its
employees and agents excepted, failing which Landlord may restore the Premises
and such equipment and fixtures to such condition and Tenant shall pay the
reasonable cost thereof to Landlord on demand.  In addition, Tenant shall pay over to Landlord
any and all deposits or prepayments relating to use of the Premises following
the termination of Tenant’s right of possession.


 


8.2           Installations and Additions.  All
installations, additions, partitions, hardware, light fixtures, nontrade
fixtures and improvements, temporary or permanent, except trade fixtures,
movable furniture and equipment belonging to tenants under the Subleases, in or
upon the Premises, whether placed there by Tenant or Landlord, shall be
Landlord’s property and shall remain upon the Premises at the termination of
this Lease, all without compensation, allowance or credit to Tenant; provided,
however, that if prior to such termination or within ten (10) days
thereafter Landlord so directs by notice, Tenant, at Tenant’s sole cost and expense, shall
promptly remove such of the installations, additions, partitions, hardware,
light fixtures, nontrade fixtures and improvements placed in the Premises by
Tenant as are designated in such notice and repair any damage to the Premises
caused by such removal, failing which Landlord may remove the same and repair
the Premises, and Tenant shall pay the reasonable cost thereof to Landlord on
demand.  Tenant may request, prior to
making the installations, additions or other improvements provided hereinabove
that Landlord determine whether Tenant shall be obligated to remove such
installations, additions or other improvements (in which case Landlord shall
make such determination in a reasonable manner within five (5) days
following such request); provided, however, that Landlord shall not be limited
from exercising its right to require such removal, notwithstanding a prior
manifestation of the contrary intent, if the condition of such installations,
additions or other improvements have deteriorated and constitute in Landlord’s
determination, unreasonable wear and tear.


 


8.3           Trade Fixtures and Personal
Property.  To the extent directed by Landlord, Tenant
shall also remove Tenant’s furniture, machinery, safes, trade fixtures and
other items of movable personal property of every kind and description (including,
without limitation, the “Existing Equipment,” as described in Section 7.4 above)
from the Premises and restore any damage to the Premises caused thereby, such
removal and restoration to be performed prior to the end of the Term (whether by
lapse of time or by earlier termination of this Lease) or Tenant’s right of possession,
whichever might be earlier.  If Tenant
fails to remove such items, Landlord may do so and thereupon the provisions of Section 18.6
shall apply, and Tenant shall pay to Landlord upon demand the reasonable cost
of removal and of restoring the Premises.


 


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8.4           Survival.  All
obligations of Tenant under this Article 8 shall survive the expiration of
the Term or sooner termination of this Lease.


 


ARTICLE 9


 


HOLDING OVER


 


Tenant shall pay Landlord for each day Tenant retains possession of the
Premises or any part thereof after termination of this Lease, by lapse of time
or otherwise, or of Tenant’s right to possession of the Premises, an amount
which is 150% the amount of Base Rent and Tenant’s Share of Impositions for a
day based on the annual rate of Base Rent set forth in Section 3.1 and on
the last amount of Tenant’s Share of Impositions provided for in Article 4
for the period in which such possession occurs, calculated as though such
period were within the Term, and Tenant shall also pay all damages,
consequential as well as direct, sustained by Landlord by reason of such
retention.  Nothing contained in this Section shall
be construed or operate as a waiver of Landlord’s right of reentry or any other
right or remedy of Landlord.


 


ARTICLE 10


 


COMPLIANCE BY TENANT


 


Tenant agrees, for itself, its employees, agents, contractors,
subtenants, invitees and licensees, (i) to observe and not to interfere
with the rights reserved to Landlord contained in Article 11 hereof, and (ii) to
comply with all terms and conditions set forth in any recorded easements,
covenants, conditions or restrictions pertaining to the Premises at the present
time or, if Tenant has consented thereto, thereafter.  Any violation of the foregoing agreements may
be restrained; but, whether or not so restrained, Tenant acknowledges and
agrees that it shall be and remain liable for all damages, loss, costs and
expenses resulting therefrom.


 


ARTICLE 11


 


RIGHTS RESERVED TO LANDLORD


 


Landlord reserves the following rights, exercisable after reasonable
advance notice and in such manner as will minimize interference with the use
and occupancy of the Premises:


 


(a)           to
change the name or street address of the Premises (but only if requested to do
so by the U.S. postal service or the local municipality or any other
governmental authority);


 


(b)           to
retain at all times, and to use in appropriate instances, pass keys to the
Premises;


 


15





















 


(c)           to
exhibit the Premises at reasonable hours; and


 


(d)           to
enter the Premises at reasonable hours for inspection.


 


ARTICLE 12


 


MAINTENANCE


 


Subject to any limitation set forth in Section 7.2 hereof, Tenant
shall keep and maintain the entire exterior and interior of the Premises,
specifically including, without limitation, the roof, structural components of
the buildings, the lighting systems, and the heating, ventilating and air
conditioning equipment in good condition and repair.  Tenant specifically agrees to cause the
requirements under the Financing Documents, the Subleases, the Master Leases,
the Condominium Documents and the Hotel Management Agreement with respect to
the maintenance of the physical condition of the Premises to be complied with
at all times, at its sole cost and expense.  Tenant shall keep the Premises from falling
temporarily out of repair or deteriorating.  Tenant shall further keep and maintain the
improvements at any time situated upon the Premises and all sidewalks and areas
adjacent thereto, and all landscaped areas adjacent thereto, safe secure, clean
and sanitary (including, without limitation, snow and ice clearance, planting
and replacing flowers and landscaping, and necessary interior painting and
carpet cleaning), and in full compliance with all health, safety and police
regulations in force.


 


ARTICLE 13


 


ALTERATIONS


 


Tenant shall not, without the prior written consent of Landlord, which
shall not be unreasonably withheld, delayed or conditioned, make any
alterations, additions or improvements to the Premises, other than such
alterations, additions, or improvements to the Premises which are described in Section 7.2
or are cosmetic in nature or which shall cost less than $10,000.00.  Any alterations, additions or improvements
which are consented to by Landlord shall continue to be subject to the
remaining terms and conditions set forth in this Article 13.


 


If Landlord consents to such alterations, additions or improvements,
before commencement of the work or delivery of any materials onto the Premises,
Tenant shall furnish to Landlord for approval plans and specifications, names
and addresses of contractors, copies of contracts, necessary permits and
licenses, and instruments of indemnification against any and all claims, costs,
expenses, damages and liabilities which may arise in connection with such work,
all in such form, substance and amount as may be reasonably satisfactory to
Landlord.  In addition, for any work
which shall cost, in the aggregate, in excess of $100,000.00, prior to commencement
of any such work or delivery of any materials into the Premises,


 


16





















 


Tenant
shall provide Landlord with appropriate evidence of Tenant’s ability to pay for
such work and materials in full and, if requested by Landlord, shall deposit
with Landlord at such time such security for the payment of said work and
materials as Landlord may require.  All
alterations, additions and improvements shall be installed in a good,
workmanlike manner, and only new, high-grade materials shall be used.  All such work shall be done only by
contractors or mechanics reasonably acceptable to Landlord.  Tenant further agrees to hold Landlord
harmless from any and all liabilities of every kind and description which may
arise out of or be connected in any way with said alterations, additions or
improvements.  Before commencing any work
in connection with such alterations, additions or improvements, Tenant shall
furnish Landlord with certificates of insurance from all contractors performing
labor or furnishing materials insuring Landlord against any and all liabilities
which may arise out of or be connected in any way with said alterations,
additions or improvements.  Tenant shall
permit Landlord to supervise construction operations at Landlord’s sole cost in
connection with the foregoing work if Landlord requests to do so.  Tenant shall pay the cost of all such
alterations, additions and improvements and also the cost of decorating the
Premises occasioned by such alterations, additions and improvements, including
the cost of labor and materials, contractors’ profit, overhead and general
conditions.  Upon completing any
alterations, additions or improvements, Tenant shall furnish Landlord with
contractors’ affidavits, in form required by law, and full and final waivers of
lien and receipted bills covering all labor and materials expended and used.  All alterations, additions and improvements
shall comply with all insurance requirements and with all city and county
ordinances and regulations and with the requirements of all state and federal
statutes and regulations.


 


ARTICLE 14


 


ASSIGNMENT AND SUBLETTING


 


14.1         Assignment and Subletting.  Except as otherwise herein
provided, and except in accordance with the Financing Documents, the Condominium
Documents and the Master Leases, Tenant shall not, without the prior written
consent of Landlord in each instance, (a) assign, transfer, mortgage,
pledge, hypothecate or encumber, or subject to or permit to exist upon or be
subjected to any lien or charge, this Lease or any interest under it; (b) allow
to exist or occur any transfer of or lien upon this Lease or Tenant’s interest
herein by operation of law; (c) sublet the Premises or any part thereof;
or (d) permit the use or occupancy of the Premises or any part thereof for
any purpose not provided for under Article 5 of this Lease or by anyone
other than Tenant and Tenant’s employees.  In no event shall this Lease be assigned or
assignable by voluntary or involuntary bankruptcy proceedings or otherwise, and
in no event shall this Lease or any rights or privileges hereunder be an asset
of Tenant under any bankruptcy, insolvency or reorganization proceedings.  Notwithstanding the foregoing Landlord hereby
consents to the subleasing by Tenant of space in the commercial space (as
opposed


 


17


















 


to
the hotel) to various tenants selected by Tenant and to the resubleasing of the
same space to other tenants upon termination of any of such subleases or
successor subleases, provided in each case that the sublease complies with all
applicable requirements of the Financing Documents, the Subleases, the Master
Leases, the Condominium Documents and the Hotel Management Agreement.


 


14.2                           Tenant To
Remain Obligated.  Consent by
Landlord to any assignment, subletting, use, occupancy or transfer shall not
operate to relieve Tenant from any covenant or obligation hereunder except to
the extent, if any, expressly provided for in such consent, or be deemed to be
a consent to or relieve Tenant from obtaining Landlord’s consent to any
subsequent assignment, transfer, lien, charge, subletting, use or occupancy.  Tenant shall pay all of Landlord’s costs, charges
and expenses, including attorneys’ fees, reasonably incurred in connection with
any assignment, transfer, lien, charge, subletting, use or occupancy made or requested
by Tenant.  Tenant agrees that all
advertising by Tenant or on Tenant’s behalf with respect to the assignment of
this Lease or subletting of space must be approved in writing by Landlord prior
to publication.


 


14.3                           Landlord’s
Consent.  Landlord will not unreasonably
withhold or delay its consent to Tenant’s assignment of this Lease or
subletting the space leased hereunder.  Landlord
shall not be deemed to have unreasonably withheld its consent to a sublease of
all or part of the Premises or an assignment of this Lease if its consent is
withheld because: (a) Tenant is then in default beyond any applicable grace
period hereunder; (b) any notice of termination of this Lease or termination of
Tenant’s possession shall have been given under Article 18 hereof; (c) the
portion of the Premises which Tenant proposes to sublease, including the means
of ingress to and egress from and the proposed use thereof, or the remaining
portion of the Premises will violate any city, state or federal law, ordinance
or regulation, including, without limitation, any applicable building code or
zoning ordinances; (d) the proposed use of the Premises by the subtenant or
assignee does not conform with the uses permitted by this Lease; (e) in the
reasonable judgment of Landlord, the proposed subtenant or assignee is of a
character or is engaged in a business which would be deleterious to the
reputation of the Premises, or the subtenant or assignee is not sufficiently
financially responsible to perform its obligations under the proposed sublease
or assignment; provided, however, that the foregoing are merely examples of
reasons for which Landlord may withhold its consent and shall not be deemed
exclusive of any permitted reasons for reasonably withholding consent, whether
similar to or dissimilar from the foregoing examples.  Any consent by Landlord to a proposed
assignment or sublease shall in any event be subject to the terms of Section
14.2 hereinabove.


 


14.4                           Assignee
To Assume Obligations.  If Tenant
shall assign this Lease as permitted herein, the assignee shall expressly
assume all of the obligations of Tenant hereunder in a written instrument
reasonably satisfactory to Landlord and furnished to Landlord not later than
fifteen (15) days prior to the effective date of


 


18





















 


the
assignment.  If Tenant shall sublease the
Premises as permitted herein, Tenant shall obtain and furnish to Landlord, not
later than fifteen (15) days prior to the effective date of such sublease and
in form satisfactory to Landlord, the written agreement of such subtenant
stating that the subtenant will attorn to Landlord, at Landlord’s option and
written request, in the event this Lease terminates before the expiration of
the sublease.


 


14.5                           Change of
Ownership or Control of Tenant.  Notwithstanding
anything to the contrary in this Article 14, if Tenant is a corporation,
partnership or limited liability company, and if during the Term of this Lease,
Tenant contemplates that the ownership of the shares of stock, partnership
interests or membership interests in Tenant shall be changing, such proposed
change shall not constitute a proposed assignment of this Lease or otherwise be
governed by the terms of this Article 14. 
Notwithstanding the foregoing, Tenant shall advise Landlord of any such
changes.


 


ARTICLE 15


 


WAIVER OF CERTAIN CLAIMS;
INDEMNITY BY TENANT


 


15.1                           Waiver of
Certain Claims; Release by Tenant.  To the
extent not expressly prohibited by law, Tenant releases Landlord and its
beneficiaries, if any, and their agents, servants and employees, from and
waives all claims for damages to person or property sustained by Tenant, or by
any other person, resulting directly or indirectly from fire or other casualty,
or any existing or future condition, defect, matter or thing in or about the
Premises, or from any equipment or appurtenance therein, or from any accident
in or about the Premises, or from any act or neglect of any other person,
including Landlord’s agents and servants and contractors; provided, however,
that the foregoing release shall not operate in the event of the gross
negligence or willful misconduct of Landlord’s agents, servants or contractors.  This Section 15.1 shall apply especially, but
not exclusively, to damage caused by water, snow, frost, steam, excessive heat
or cold, sewerage, gas, odors or noise, or the bursting or leaking of pipes or
plumbing fixtures, broken glass, sprinkling or air conditioning devices or
equipment, or flooding of basements, and shall apply without distinction as to
the person whose act or neglect was responsible for the damage and whether the
damage was due to any of the acts specifically enumerated above or from any
other thing or circumstance, whether of a like nature or of a wholly different
nature.


 


15.2                           Damage Caused
by Tenant’s Neglect.  If any damage
to the Premises, or any equipment or appurtenance thereon, results from any act
or neglect of Tenant, its employees, agents, contractors, licensees or
invitees, Tenant shall be liable therefor, and Landlord may at its option
following expiration of the applicable grace period repair such damage, and
Tenant shall upon demand by


 


19





















 


Landlord
reimburse Landlord for all reasonable costs of repairing such damage in excess
of amounts, if any, paid to Landlord under insurance covering such damage.


 


15.3                           Tenant
Responsible for Personal Property.  All
personal property on the Premises belonging to Tenant or its tenants shall be
there at the risk of Tenant, and Landlord shall not be liable for damage
thereto or theft or misappropriation thereof.


 


15.4                           Indemnification.  To the extent not expressly prohibited by
law, Tenant agrees to hold Landlord and its beneficiaries, if any, and their
agents, servants and employees, harmless and to indemnify each of them against
claims and liabilities, including reasonable attorneys’ fees, for injuries to
all persons and damage to or theft or misappropriation or loss of property
occurring in or about the Premises arising from Tenant’s occupancy of the
Premises or the conduct of its business or from any activity, work or thing
done, permitted or suffered by Tenant in or about the Premises or from any
breach or default on the part of Tenant in the performance of any covenant or
agreement on the part of Tenant to be performed pursuant to the terms of this
Lease, or due to any other act or omission of Tenant, its agents, contractors,
invitees, licensees or employees, but only to the extent of Landlord’s
liability, if any, in excess of amounts, if any, paid to Landlord under insurance
covering such claims or liabilities.  Tenant’s
obligation to indemnify Landlord hereunder shall include the duty to defend
against any claims asserted by reason of any such claims or liabilities and to
pay any judgments, settlements, costs, fees and expenses, including attorneys’
fees, reasonably incurred in connection therewith.  For such purpose, Tenant shall be entitled to
the use of an attorney designated by it or its insurer.


 


ARTICLE 16


 


DAMAGE OR
DESTRUCTION BY CASUALTY


 


If the Premises shall be damaged by fire or other
casualty and if such damage does not render all or a substantial portion of the
Premises untenantable, then Landlord shall proceed to repair and restore the
same with reasonable promptness, subject to reasonable delays for insurance
adjustments and delays caused by matters beyond Landlord’s reasonable control.  If any such damage renders all or a
substantial portion of the Premises untenantable, Landlord shall, with
reasonable promptness after the occurrence of such damage, estimate the length
of time that will be required to substantially complete the repair and
restoration of such damage and shall by notice advise Tenant of such estimate.  If it is so estimated that the amount of time
required to substantially complete any such repair and restoration will exceed
three hundred sixty (360) days from the date such damage occurred, then either
Landlord or Tenant (but, as to Tenant, only if all or a substantial portion of
the Premises are rendered untenantable) shall have the right to terminate this
Lease as of the date of such damage upon giving notice to the other


 


20





















 


at
any time within twenty (20) days after Landlord gives Tenant the notice
containing said estimate (it being understood that Landlord may, if it elects
to do so, also give such notice of termination together with the notice
containing said estimate).  Unless this
Lease is terminated as provided in the preceding sentence, Landlord shall
proceed with reasonable promptness to repair and restore the Premises, subject
to reasonable delays for insurance adjustments and delays caused by matters
beyond Landlord’s reasonable control, and also subject to zoning laws and
building codes then in effect.  Landlord
shall have no liability to Tenant, and Tenant shall not be entitled to
terminate this Lease (except as hereinafter provided) if such repairs and
restoration are not in fact completed within the time period estimated by
Landlord, as aforesaid, or within said three hundred sixty (360) days.  If the Premises are not repaired or restored
within said three hundred sixty (360) days (as the same may be extended for a
period not to exceed five hundred forty (540) days, to the extent that
additional time is required on account of Landlord’s inability to timely
perform as more specifically provided in Section 29.11 hereinbelow) after
the date of such fire or other casualty, then either party may terminate this
Lease, effective as of the date of such fire or other casualty, by written
notice to the other party not later than thirty (30) days after the expiration
of said five hundred forty (540) day period, but prior to substantial
completion of repair or restoration.  Notwithstanding
anything to the contrary herein set forth, (a) Landlord shall have no duty
pursuant to this Section 16.1 to expend for any repair or restoration amounts
in excess of insurance proceeds paid to Landlord and available for repair or
restoration (without limiting Tenant’s right to terminate this Lease as
aforesaid); (b) Tenant shall not have the right to terminate this Lease
pursuant to this Section 16.1 if the damage or destruction was caused by the
act or neglect of Tenant or its agents or employees; and (c) if any such damage
rendering all or a substantial portion of the Premises untenantable shall occur
during the last two (2) years of the Term, either party shall have the option
to terminate this Lease by giving written notice to the other within sixty (60)
days after the date such damage occurred, and, if such option is so exercised,
this Lease shall terminate as of the date of such notice.


 


ARTICLE 17


 


EMINENT DOMAIN


 


If the Premises, or a substantial part thereof, shall
be taken or condemned by any competent authority for any public or quasipublic
use or purpose, the Term of this Lease shall end upon and not before the
earlier of (a) the date when the possession of the part so taken shall be
required for such use or purpose or (b) the effective date of the taking, and
(except as otherwise herein provided) without apportionment of the award to or
for the benefit of Tenant.  In the event
of the foregoing, Rent at the then current rate shall be apportioned as of the
date of the termination.  A “substantial
part” of the Premises shall be deemed taken or condemned if, as Tenant may
reasonably determine, such part taken shall


 


21





















 


materially
interfere with the economic utilization of the Premises, taken as a whole.  No money or other consideration shall be
payable by Landlord to Tenant for the right of termination, and Tenant shall
have no right to share in the condemnation award, whether for a total or
partial taking, other than on account of compensation for the unamortized value
of the Tenant’s leasehold improvements and on account of Tenant’s interest
hereunder in light of the below-market rental, if any, payable hereunder.  In the event that the Term of this Lease
shall not be terminated as aforesaid in the event of a taking or condemnation,
Landlord shall utilize the net proceeds from condemnation for the purpose of
restoring the Premises to an economic whole within such a period of time as
shall be reasonably necessary under the circumstances.


 


ARTICLE 18


 


DEFAULT


 


18.1                           Events of
Default.  The occurrence of any one or
more of the following matters constitutes a default (“Default”)
by Tenant under this Lease:


 


(a)                                  failure by Tenant to
pay, within ten (10) days after notice of failure to pay on the due date from
Landlord to Tenant, Rent or any other moneys required to be paid by Tenant
under this Lease;


 


(b)                                 failure by Tenant to
cure within thirty (30) days after receipt of notice from Landlord of any
hazardous condition which Tenant has created in violation of law or this Lease,
provided that if such failure of the Tenant cannot reasonably be cured with due
diligence within such thirty (30) day period and Tenant has commenced and is
diligently prosecuting such cure to completion, then such thirty (30) day
period shall be extended until the date when such cure could, with due
diligence, be reasonably completed, but in no event shall such extended period
exceed ninety (90) days in the aggregate from the expiration of the initial
thirty (30) day period;


 


(c)                                  failure by Tenant to
observe or perform any other covenant, agreement, condition or provision of
this Lease, if such failure shall continue for thirty (30) days after notice
thereof from Landlord to Tenant, or such longer period as is necessary for
Tenant, acting diligently, to cure, if such failure cannot reasonably be
corrected within said thirty (30) day period;


 


(d)                                 the levy upon under
writ of execution or the attachment by legal process of the leasehold interest
of Tenant, or the filing or creation of a lien in respect of such leasehold
interest, which lien shall not be released or discharged within sixty (60) days
from the date of such filing;


 


(e)                                  Tenant abandons the
Premises whether or not Tenant thereafter continues to pay the Rent due under
this Lease;


 


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(f)                                    Tenant becomes
insolvent or bankrupt, or admits in writing its inability to pay its debts as
they mature, or makes an assignment for the benefit of creditors, or applies
for or consents to the appointment of a trustee or receiver for Tenant or for
the major part of its property;


 


(g)                                 a trustee or receiver
is appointed for Tenant or for the major part of its property and is not
discharged within ninety (90) days after such appointment; or


 


(h)                                 bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings for relief under any bankruptcy law or similar law for the relief of debtors, are
instituted (i) by Tenant or (ii) against Tenant and are allowed against it or
are consented to by it or are not dismissed or stayed within ninety (90) days
after such institution.


 


18.2                           Rights
and Remedies of Landlord.  If a Default
occurs, Landlord shall have the rights and remedies hereinafter set forth,
which shall be distinct, separate and cumulative and shall not operate to
exclude or deprive Landlord of any other right or remedy allowed it by law:


 


(a)                                  Landlord may
terminate this Lease by giving to Tenant notice of Landlord’s election to do
so, in which event the Term of this Lease shall end, and all right, title and
interest of Tenant hereunder shall expire on the date stated in such notice;


 


(b)                                 Landlord may
terminate the right of Tenant to possession of the Premises without terminating
this Lease by giving notice to Tenant that Tenant’s right of possession shall
end on the date stated in such notice, whereupon the right of Tenant to
possession of the Premises or any part thereof shall cease on the date stated
in such notice; and


 


(c)                                  Landlord may enforce
the provisions of this Lease and may enforce and protect the rights of Landlord
hereunder by a suit or suits in equity or at law for the specific performance
of any covenant or agreement contained herein, or for the enforcement of any
other appropriate legal or equitable remedy, including recovery of all moneys
due or to become due from Tenant under any of the provisions of this Lease.


 


18.3                           Right to
ReEnter.  If Landlord exercises either of
the remedies provided for in subparagraphs (a) and (b) of the foregoing Section
18.2, Tenant shall surrender possession and vacate the Premises and immediately
deliver possession thereof to Landlord, and Landlord may reenter and take
complete and peaceful possession of the Premises, pursuant to applicable legal
proceedings, full and complete license so to do being hereby granted to Landlord,
and Landlord may remove all occupants and property therefrom, without
relinquishing Landlord’s right to Rent or any other right given to Landlord
hereunder or by operation of law.


 


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18.4                          Current
Damages.  If Landlord terminates the
right of Tenant to possession of the Premises without terminating this Lease,
Landlord shall have the right to immediate recovery of all amounts then due
hereunder.  Such termination of
possession shall not release Tenant, in whole or in part, from Tenant’s
obligation to pay the Rent hereunder for the full Term, and Landlord shall have
the right, from time to time, to recover from Tenant, and Tenant shall remain
liable for, all Base Rent, Tenant’s Share of Impositions and any other sums
accruing as they become due under this Lease during the period from the date of
such notice of termination of possession to the stated end of the Term.  In any such case Landlord may relet the
Premises or any part thereof for the account of Tenant for such rent, for such
time (which may be for a term extending beyond the Term of this Lease) and upon
such terms as Landlord shall reasonably determine and collect the rents from
such reletting.  Landlord shall not be
required to accept any tenant offered by Tenant or to observe any instructions
given by Tenant relative to such reletting. 
Also, in any such case, Landlord may make repairs, alterations and additions
in or to the Premises and redecorate the same to the extent reasonably deemed
by Landlord necessary or desirable and, in connection therewith, change the
locks to the Premises, and Tenant shall upon demand pay the reasonable cost of all
the foregoing together with Landlord’s reasonable expenses of reletting.  The rents from any such reletting shall be
applied first to the payment of the reasonable expenses of reentry,
redecoration, repair and alterations and the reasonable expenses of reletting,
and second to the payment of Rent herein provided to be paid by Tenant.  Any excess or residue shall operate only as
an offsetting credit against the amount of Rent due and owing as the same
thereafter becomes due and payable hereunder, and the use of such offsetting
credit to reduce the amount of Rent due Landlord, if any, shall not be deemed
to give Tenant any right, title or interest in or to such excess or residue,
and any such excess or residue shall belong to Landlord solely, and in no event
shall Tenant be entitled to a credit on its indebtedness to Landlord in excess
of the aggregate sum (including Base Rent and Tenant’s Share of Impositions)
which would have been paid by Tenant for the period for which the credit to
Tenant is being determined, had no Default occurred.  No such reentry or repossession, repairs, alterations
and additions, or reletting shall be construed as an eviction or ouster of
Tenant or as an election on Landlord’s part to terminate this Lease, unless a
written notice of such intention shall be given to Tenant, or shall operate to
release Tenant in whole or in part from any of Tenant’s obligations hereunder,
and Landlord may, at any time and from time to time, sue and recover judgment
for any deficiencies from time to time remaining after the application from
time to time of the proceeds of any such reletting.


 


18.5                          Final Damages.  If this Lease is terminated by Landlord as
provided for by subparagraph (a) of Section 18.2, Landlord shall be entitled to
recover from Tenant all Rent accrued and unpaid for the period up to and
including such termination date, as well as 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, which
may be then owing and unpaid, and


 


24





















 


all
costs and expenses, including court costs and attorneys’ fees, reasonably
incurred by Landlord in the enforcement of its rights and remedies hereunder,
and, in addition, Landlord shall be entitled to recover as damages for loss of
the bargain and not as a penalty: (a) the aggregate sum which at the time of
such termination represents the excess, if any, of the present value of the
aggregate rents which would have been payable after the termination date had
this Lease not been terminated, including, without limitation, Base Rent at the
annual rate or respective annual rates for the remainder of the Term provided
for in Article 3 of this Lease or elsewhere herein, over the then present value
of the then aggregate fair rental value of the Premises for the balance of the
Term, such present value to be computed in each case on the basis of a per
annum discount rate equal to the default rate of interest on the termination
date (as described in Section 29.8 hereinbelow) from the respective dates upon
which such rentals would have been payable hereunder had this Lease not been
terminated; and (b) any damages in addition thereto, including reasonable
attorneys’ fees and court costs, which Landlord shall have sustained by reason
of the breach of any of the covenants of this Lease other than for the payment
of Rent.


 


18.6                          Removal
of Personal Property.  All property
of Tenant removed from the Premises by Landlord pursuant to any provisions of
this Lease or of law may be handled, removed or stored by Landlord at the cost
and expense of Tenant, and Landlord shall in no event be responsible for the
value, preservation or safekeeping thereof. 
Tenant shall pay Landlord for all expenses reasonably incurred by
Landlord in such removal and storage charges against such property so long as the
same shall be in Landlord’s possession or under Landlord’s control.  All such property not removed from the
Premises by the Tenant on or before the end of the Term, however terminated
(i.e.  whether by lapse of time or
otherwise), or on or before the earlier termination of Tenant’s right of
possession of the Premises, shall, at Landlord’s option, be conclusively deemed
to have been conveyed by Tenant to Landlord as by bill of sale without further
payment or credit by Landlord to Tenant.


 


18.7                          Attorneys’
Fees.  Tenant shall pay all of
Landlord’s costs, charges and expenses, including court costs and reasonable
attorneys’ fees, reasonably incurred in enforcing Tenant’s obligations under
this Lease, reasonably incurred by Landlord in any action brought by Tenant in
which Landlord is the prevailing party, or reasonably incurred by Landlord in
any litigation, negotiation or transaction in which Tenant causes Landlord,
without Landlord’s fault, to become involved or concerned.  Landlord shall pay all of Tenant’s costs,
charges and expenses, including court costs and attorneys’ fees reasonably
incurred by Tenant in connection with the enforcement of Landlord’s obligations
under this Lease, reasonably incurred by Tenant in any action brought by
Landlord in which Tenant is the prevailing party, or reasonably incurred by Tenant
in any litigation, negotiation or transaction in which Landlord causes Tenant,
without Tenant’s fault, to become involved or concerned.


 


25





















 


18.8                           Assumption
or Rejection in Bankruptcy.  If Tenant
shall be adjudged bankrupt or if a trustee in bankruptcy shall be appointed for
Tenant, Landlord and Tenant agree, to the extent permitted by law, to request
that the trustee in bankruptcy shall determine within sixty (60) days’
thereafter whether to assume or reject this Lease.


 


ARTICLE 19


 


SUBORDINATION


 


19.1                           Subordination.  Landlord may have previously and may
hereafter from time to time execute and deliver one or more mortgages (hereinafter
referred to as a “Mortgage”)
against the Premises or any interest therein. 
If requested by the mortgagee under any Mortgage, Tenant will either (a)
subordinate its interest in this Lease to said Mortgage, and to any and all
advances made thereunder and to the interest thereon, and to all renewals,
replacements, supplements, amendments, modifications and extensions thereof, or
(b) make certain of Tenant’s rights and interest in this Lease superior
thereto; and Tenant will promptly execute and deliver such agreement or
agreements as may be reasonably required by such mortgagee under any Mortgage.


 


19.2                           Liability
of Holder of Mortgage; Attornment.  It is
further agreed that (a) if any Mortgage shall be foreclosed, (i) the holder of
the Mortgage (or its grantee) or purchaser at any foreclosure sale (or grantee
in a deed in lieu of foreclosure), as the case may be, shall not be (x) liable
for any act or omission of any prior landlord (including Landlord), (y) subject
to any offsets or counterclaims which Tenant may have against a prior landlord
(including Landlord), unless expressly provided for herein, or (z) bound by any
prepayment of Base Rent or Tenant’s Share of Impositions which Tenant may have
made in excess of the amounts then due for the next succeeding month; (ii) the
liability of the mortgagee hereunder or the purchaser at such foreclosure sale
or the liability of a subsequent owner designated as Landlord under this Lease
shall exist only so long as such mortgagee, purchaser or owner is the owner of
the Premises, and such liability shall not continue or survive with respect to
claims accruing after further transfer of ownership; and (iii) upon request of
the mortgagee, if the Mortgage shall be foreclosed, Tenant will attorn, as
Tenant under this Lease, to the purchaser at any foreclosure sale under any
Mortgage, and Tenant will execute such instruments as may be necessary or appropriate
to evidence such attornment; and (b) this Lease may not be modified or amended
so as to reduce the Rent or shorten the Term provided hereunder or so as to adversely
affect in any other respect to any material extent the rights of Landlord, nor
shall this Lease be cancelled or surrendered, without the prior written
consent, in each instance, of the mortgagee under any Mortgage.


 


19.3                           Modification
Required by Mortgagee.  Should any
prospective mortgagee require a modification or modifications of this Lease,
which modification


 


26





















 


or
modifications will not cause an increased cost or expense to Tenant or in any
other way materially change the rights and obligations of Tenant hereunder,
Tenant agrees that this Lease may be so modified and agrees to execute whatever
documents are required therefor and deliver the same to Landlord within ten
(10) days following the request therefor.


 


19.4                           Short
Form Lease or Notice of Lease.  Should
any prospective mortgagee require execution of a short form of lease for
recording (containing the names of the parties, a description of the Premises
and the Term of this Lease) or a certification from Tenant concerning this
Lease in such form as may be reasonably required by a mortgagee, Tenant agrees
to promptly execute such short form of lease or certificate and deliver the
same to Landlord within ten (10) days following the request therefor, whereupon
Landlord shall join in the execution of such short form lease and arrange for
the recordation thereof.  In addition, at
the request of Landlord or Tenant, the parties shall execute a short form of lease
or notice of lease for recording containing the names of the parties, a
description of the Premises and the Term of this Lease.


 


19.5                           Tenant Protections.  With respect to any Mortgage to which Tenant’s
interest under this Lease shall be subordinate, Landlord shall use reasonable efforts
to cause (but shall not obligated to cause) the mortgagee thereunder and its
successors and assigns to agree to recognize and not disturb the interest of
Tenant in the event of a default by Landlord under said Mortgage.  Notwithstanding the foregoing, Landlord shall
agree to cause any notice of default under such Mortgage for the financing
related thereto to be promptly given to Tenant and Landlord shall agree to
request from each lender that Tenant to have a right to cure any default by
Landlord under said Mortgage (with the understanding that lenders may not
comply with such request).


 


ARTICLE 20


 


MORTGAGEE PROTECTION


 


Tenant agrees to give any holder of any Mortgage (as
defined in Section 19.1 hereof) against the Premises, or any interest therein,
by registered or certified mail, a copy of any notice or claim of Default
served upon Landlord by Tenant, provided that prior to such notice Tenant has
been notified in writing (by way of service on Tenant of a copy of an assignment
of Landlord’s interests in leases, or otherwise) of the address of such
Mortgage holder.  Tenant further agrees
that if Landlord shall have failed to cure such Default within twenty (20) days
after such notice to Landlord (or if such Default cannot be cured or corrected
within that time, then such additional time as may be necessary if Landlord has
commenced within such twenty (20) days and is diligently pursuing the remedies
or steps necessary to cure or correct such Default), then the holder of the
Mortgage shall have an additional thirty (30) days within which to cure or
correct such Default (or if such Default


 


27





















 


cannot
be cured or corrected within that time, then such additional time as may be necessary
if such holder of the Mortgage has commenced within such thirty (30) days and
is diligently pursuing the remedies or steps necessary to cure or correct such
Default, including the time necessary to obtain possession if possession is
necessary to cure or correct such Default).


 


ARTICLE 21


 


ESTOPPEL CERTIFICATE


 


Tenant agrees that, from time to time upon not less
than ten (10) days’ prior request by Landlord or the holder of any Mortgage,
Tenant (or any permitted assignee, subtenant, licensee, concessionaire or other
occupant of the Premises claiming by, through or under Tenant) will deliver to
Landlord, or to the holder of any Mortgage, a statement in writing signed by
Tenant certifying (a) that this Lease is unmodified and in full force and
effect (or if there have been modifications, that this Lease as modified is in
full force and effect and identifying the modifications); (b) the date upon
which Tenant began paying Rent and the dates to which the Rent and other
charges have been paid; (c) that Landlord is not in Default under any provision
of this Lease, or, if in Default, the nature thereof in detail; (d) that (if
applicable) the Premises have been completed in accordance with the terms
hereof and Tenant is in occupancy and paying Rent on a current basis with no
rental offsets or claims; (e) that there has been no prepayment of Rent other
than that provided for in this Lease; (f) that there are no actions, whether
voluntary or otherwise, pending against Tenant under the bankruptcy laws of the
United States or any state thereof; and (g) such other matters as may be
required by Landlord or the holder of the Mortgage.  Landlord shall provide a statement of like
tenor if and as requested by Tenant.


 


ARTICLE 22


 


SUBROGATION AND INSURANCE


 


22.1                           Waiver of
Subrogation.  Landlord and Tenant agree to
have all fire and extended coverage and other property damage insurance which
may be carried by either of them endorsed with a clause (if commercially
available) providing that any release from liability of, or waiver of claim
for, recovery from the other party entered into in writing by the insured
thereunder prior to any loss or damage shall not affect the validity of said
policy or the right of the insured to recover thereunder and providing further
that the insurer waives all rights of subrogation which such insurer might have
against the other party.  Without
limiting any release or waiver of liability or recovery set forth elsewhere in
this Lease, and notwithstanding anything in this Lease which may appear to be
to the contrary, each of the parties hereto waives all claims for recovery from
the other party for any loss or damage to any of its property insured under
valid and collectible insurance policies to the


 


28





















 


extent
of any recovery collectible under such insurance policies.  Notwithstanding the foregoing or anything
contained in this Lease to the contrary, any release or any waiver of claims
shall not be operative, nor shall the foregoing endorsements be required, in
any case where the effect of such release or waiver is to invalidate insurance
coverage or invalidate the right of the insured to recover thereunder or to
increase the cost thereof (provided that in the case of increased cost the
other party shall have the right, within ten (10) days following written
notice, to pay such increased cost keeping such release or waiver in full force
and effect).


 


22.2                           Tenant’s
Insurance.  Tenant shall procure
and maintain policies of insurance, at its sole cost and expense, during the
entire Term hereof with terms and coverages and companies reasonably
satisfactory to Landlord and with such increases in limits as Landlord may from
time to time reasonably request, including all insurance required under any
Mortgage and/or the Hotel Management Agreement, the Master Leases, the
Condominium Documents or the Subleases.  Alternatively,
Landlord may cause such policies to be procured and maintained, and Tenant
shall reimburse Landlord for the cost thereof, upon demand.  If Landlord provides policies of insurance,
such policies shall be all risk coverage exclusive of footings and foundation.


 


All policies of insurance required hereunder which
insure against loss or damage to the Premises shall provide that the proceeds
thereof (or so much of such proceeds as pertain to loss or damage to the
Premises) shall be payable to Landlord, and if Landlord so requests, shall also
be payable to any contract purchaser of the Premises and any holder of a
Mortgage, as the interest of such purchaser or holder of a Mortgage appears
pursuant to a standard named insured or mortgagee clause.  Tenant shall not, on Tenant’s own initiative
or pursuant to request or requirement of any third party, take out separate
insurance concurrent in form or contributing in the event of loss with that
required hereunder, unless Landlord is included therein as a named insured with
loss payable as in this Section provided Tenant shall immediately notify
Landlord whenever any such separate insurance is taken out and shall deliver to
Landlord duplicate originals thereof or original certificates evidencing the
same with true copies of such insurance policies attached.  All such policies of insurance shall provide
that any loss shall be payable to Landlord notwithstanding any act or omission
of Tenant which might otherwise result in a forfeiture or reduction of such
insurance.


 


22.3                           Certificates
of Insurance. 
Prior to the commencement of the Term (unless Landlord has elected to
procure the policies of insurance as provided above), Tenant shall furnish to
Landlord policies or certificates evidencing such coverage, which policies or
certificates shall state that such insurance coverage may not be reduced,
cancelled or not renewed without at least thirty (30) days’ prior written notice
to Landlord and Tenant (unless such cancellation is due to nonpayment of premium,
and, in that case, only ten (10) days’ prior written notice shall be sufficient).


 


29





















 


ARTICLE 23


 


NONWAIVER


 


No waiver of any condition expressed in this Lease
shall be implied by any failure of either party to enforce any remedy on
account of the violation of such condition whether or not such violation be
continued or repeated subsequently, and no express waiver shall affect any
condition other than the one specified in such waiver and that one only for the
time and in the manner specifically stated. 
Without limiting Landlord’s rights under Article 9, it is agreed that no
receipt of monies by Landlord from Tenant after the termination in any way of
the Term or of Tenant’s right of possession hereunder or after the giving of
any notice shall reinstate, continue or extend the Term or affect any notice
given to Tenant prior to the receipt of such monies.  It is also agreed that after the service of
notice or the commencement of a suit or after final judgment for possession of
the Premises, Landlord may receive and collect any monies due, and the payment
of said monies shall not waive or affect said notice, suit or judgment.


 


ARTICLE 24


 


TENANT CORPORATION, PARTNERSHIP

OR LIMITED LIABILITY COMPANY


 


In case Tenant is a corporation, Tenant (a) represents
and warrants that this Lease has been duly authorized, executed and delivered
by and on behalf of Tenant and constitutes the valid and binding agreement of
Tenant in accordance with the terms hereof, and (b) if Landlord so requests,
shall deliver to Landlord or its agent, concurrently with the delivery of this
Lease executed by Tenant, certified resolutions of the board of directors (and
shareholders, if required) authorizing Tenant’s execution and delivery of this
Lease and the performance of Tenant’s obligations hereunder.  In case Tenant is a partnership, Tenant
represents and warrants that all of the persons who are general or managing
partners in said partnership have executed this Lease on behalf of Tenant, or
that this Lease has been executed and delivered pursuant to and in conformity
with a valid and effective authorization therefor by all of the general or
managing partners of such partnership and is and constitutes the valid and
binding agreement of the partnership and each and every partner therein in
accordance with its terms.  Also, it is
agreed that each and every present and future partner in Tenant shall be and remain
at all times jointly and severally liable hereunder and that the death,
resignation or withdrawal of any partner shall not release the liability of
such partner under the terms of this Lease unless and until Landlord shall have
consented to such release in writing.  In
case Tenant is a limited liability company, Tenant represents and warrants that
all of the persons who are Managers or Managing Members in said limited
liability company have executed this Lease on behalf of Tenant, or that this
Lease has been executed and delivered pursuant to and in conformity with a
valid and effective


 


30





















 


authorization
therefor by all of the managers or managing members of such company and is and
constitutes the valid and binding agreement of the company.


 


ARTICLE 25


 


REAL ESTATE BROKERS


 


Each party represents that it has not dealt with any
broker in connection with this Lease, and agrees to indemnify and hold the
other harmless from all damages, liability and expense (including reasonable
attorneys’ fees) arising from any claims or demands of any broker or brokers or
finders for any commission alleged to be due such broker or brokers or finders
in connection with its having introduced such party to the Premises or dealing
with such party in the negotiation of this Lease.


 


ARTICLE 26


 


NOTICES


 


All notices and demands required or desired to be
given by either party to the other with respect to this Lease or the Premises
shall be in writing and shall be sent by overnight courier service, prepaid, or
sent by United States registered or certified mail, return receipt requested,
postage prepaid, and addressed as herein provided.  Notices to or demands upon Tenant shall be
addressed to Hudson Leaseco LLC at c/o NorthStar Capital Investment Corp., 527
Madison Avenue, 16th Floor, New York, NY 10022, Attention: Marc
Gordon, with copies to Chevron TCI, Inc., 575 Market Street, 32nd
Floor, San Francisco, CA 94105, Attention: John H.  Medinger. 
Notices to or demands upon Landlord shall be addressed to Henry Hudson
Holdings LLC at c/o Ian Schrager Hotels, 475 Tenth Avenue, 11th
Floor, New York, NY 10018, Attention: Ian Schrager, with copies to Neil L.  Rock, Esq., Skadden, Arps, Slate, Meagher
& Flom, LLP, Four Times Square, New York, NY 10036.  Notices and demands shall be deemed given and
served (a) upon receipt or refusal, or (b) one (1) business day after deposit
with an overnight courier service.  Either
party may change its address for receipt of notices by giving notice of such
change to the other party in accordance herewith.  Notices and demands from Landlord to Tenant
may be signed by Landlord, its beneficiary, the managing agent for the Premises
or the agent of any of them.


 


ARTICLE 27


 


HAZARDOUS
SUBSTANCES


 


27.1                           Defined Terms.


 


(a)                                  “Claim” shall mean and
include any demand, cause of action, proceeding or suit (i) for damages (actual
or punitive), losses, injuries to


 


31





















 


person or property, damages to natural resources,
fines, penalties, interest, contribution or settlement, (ii) for the costs of
site investigations, feasibility studies, information requests, health or risk
assessments or Response actions, and (iii) for enforcing insurance,
contribution or indemnification agreements.


 


(b)                                 “Environmental Laws” shall mean and
include all existing and future federal, state and local statutes, ordinances,
regulations and rules relating to environmental quality, health, safety,
contamination and cleanup, including, without limitation, the Clean Air Act, 42
U.S.C. Section 7401 et  seq.; the Clean Water Act, 33 U.S.C.  Section 1251 et  seq., and the
Water Quality Act of 1987; the Federal Insecticide, Fungicide, and Rodenticide
Act (“FIFRA”), 7 U.S.C.  Section 136 et  seq.; the Marine
Protection, Research, and Sanctuaries Act, 33 U.S.C.  Section 1401 et  seq.; the
National Environmental Policy Act, 42 U.S.C. 
Section 4321 et  seq.; the Noise Control Act, 42 U.S.C.  Section 4901 et  seq.; the
Occupational Safety and Health Act, 29 U.S.C. 
Section 651 et  seq.; the Resource Conservation and
Recovery Act (“RCRA”), 42 U.S.C.  Section 6901 et  seq., as
amended by the Hazardous and Solid Waste Amendments of 1984; the Safe Drinking Water
Act, 42 U.S.C.  Section 300f et  seq.;
the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), 42 U.S.C.  Section
9601 et  seq., as amended by the Superfund Amendments and
Reauthorization Act, the Emergency Planning and Community Right to Know Act,
and the Radon Gas and Indoor Air Quality Research Act; the Toxic Substances
Control Act (“TSCA”), 15 U.S.C.  Section 2601 et  seq.; the
Atomic Energy Act, 42 U.S.C.  Section
2011 et  seq., and the Nuclear Waste Policy Act of 1982, 42 U.S.C.  Section 10101 et seq.; and the
Environmental Protection Act of New York (“IEPA”), Ill. Rev.
Stat. ch. 1111/2, para. 1001 et  seq., and state
superlien and environmental cleanup statutes, with implementing regulations and
guidelines.  Environmental Laws shall
also include all existing and future state, regional, county, municipal and
other local laws, regulations and ordinances insofar as they are equivalent or
similar to the federal laws recited above or purport to regulate Hazardous
Materials.


 


(c)                                  “Hazardous Materials” shall mean and
include the following, including mixtures thereof: any hazardous substance, pollutant,
contaminant, waste, by product or constituent regulated under CERCLA; oil and
petroleum products and natural gas, natural gas liquids, liquefied natural gas
and synthetic gas usable for fuel; pesticides regulated under the FIFRA; asbestos
and asbestos containing materials, PCBs and other substances regulated under
the TSCA; source material, special nuclear material, by product material and any
other radioactive materials or radioactive wastes, however produced, regulated
under the Atomic Energy Act or the Nuclear Waste Policy Act; chemicals subject
to the OSHA Hazard Communication Standard, 29 C.F.R. § 1910.1200 et
seq.; and industrial


 


32





















 


process and pollution control wastes, whether or not
hazardous within the meaning of RCRA, together with any and all other hazardous
or toxic materials regulated from time to time under any other Environmental
Laws.


 


(d)                                 “Manage”
means to generate, manufacture, process, treat, store, use, reuse, refine,
recycle, reclaim, blend or burn for energy recovery, incinerate, accumulate speculatively,
transport, transfer, dispose of or abandon Hazardous Materials.


 


(e)                                  “Release”
or “Released” shall mean any actual spilling,
leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, dumping or disposing of Hazardous Materials into the environment,
as “environment” is defined in CERCLA.


 


(f)                                    “Response”
or “Respond” shall mean action taken in compliance
with Environmental Laws to correct, remove, remediate, cleanup, prevent,
mitigate, monitor, evaluate, investigate, assess or abate the Release of a
Hazardous Material.


 


27.2                            Tenant’s
Obligations with Respect to Environmental Matters.  During the Term of this Lease: (a) Tenant
shall at its own cost comply with all Environmental Laws; (b) Tenant shall not
conduct or authorize the Management of any Hazardous Materials on the Premises,
including installation of any underground storage tanks, without prior written
disclosure to and approval by Landlord, provided, however, that the use by
Tenant of cleaning solvents and other materials used in the ordinary course of
the operation of the Premises shall be deemed disclosed to and approved by
Landlord, as long as such use is not in violation of any environmental clause;
(c) Tenant shall not take any action that would subject the Premises to permit
requirements under RCRA or any other Environmental Laws for storage, treatment
or disposal of Hazardous Materials; (d) Tenant shall not dispose of Hazardous
Materials in dumpsters (if any) provided by Landlord for Tenant use; (e) Tenant
shall not discharge Hazardous Materials into drains or sewers; (f) Tenant shall
not cause or allow the Release of any Hazardous Materials on, to or from the
Premises; and (g) Tenant shall at its own cost arrange for the lawful
transportation and off site disposal of all Hazardous Materials that it
generates.


 


27.3                            Copies of
Notices.  During the term of this Lease,
Tenant shall promptly provide Landlord with copies of all summons, citations,
directives, information inquiries or requests, notices of potential
responsibility, notices of violation or deficiency, orders or decrees, Claims, complaints,
investigations, judgments, letters, notices of environmental liens or Response
actions in progress and other communications, written or oral, actual or
threatened, from the United States Environmental Protection Agency,
Occupational Safety and Health Administration, New York Environmental
Protection Agency or other federal, state or local agency


 


33





















 


or
authority, or any other entity or individual, concerning (a) any Release of a
Hazardous Material on, to or from the Premises; (b) the imposition of any lien
on the Premises; or (c) any alleged violation of or responsibility under
Environmental Laws.  Landlord and
Landlord’s agents, contractors, beneficiaries and employees (and the agents,
employees or representatives of any such parties) shall have the right subject to
the other applicable provisions of this Lease to enter the Premises and conduct
appropriate inspections or tests in order to determine Tenant’s compliance with
Environmental Laws.


 


27.4                            Tests and
Reports.  Upon written request by
Landlord, Tenant shall provide Landlord with the results of appropriate reports
and tests, with transportation and disposal contracts for Hazardous Materials,
with any permits issued under Environmental Laws, and with any other applicable
documents to demonstrate that Tenant complies with all Environmental Laws
relating to the Premises, and if such reports, tests or other items reveal any
failure of the Premises to so comply with all Environmental Laws, then, in
addition to other rights and remedies of Landlord hereunder, Tenant shall
reimburse Landlord, upon demand, for the reasonable cost of such reports, tests
and other investigations.


 


27.5                            Access
and Inspection.  Landlord and its agents and
representatives shall have access to the Premises and to the books and records
of Tenant (and any occupant of the Premises claiming by, through or under
Tenant) relating to Hazardous Materials for the purpose of ascertaining the
nature of the activities being conducted thereon and to determine the type, kind
and quantity of all products, materials and substances brought onto the
Premises or made or produced thereon.  Landlord
and its agents and representatives shall have the right to take samples in
quantity sufficient for scientific analysis of all products, materials and substances
present on the Premises, including, but not limited to, samples of products, materials
or substances brought onto or made or produced on the Premises by Tenant or an
occupant claiming by, through or under Tenant or otherwise present on the
Premises.  And, further, notwithstanding
any provision of this Lease or applicable statutes or judicial decisions to the
contrary, with respect to any assignment, subletting, grant of license,
concession or any other permission to use the Premises by any person other than
Tenant, Landlord shall have the right to withhold Landlord’s consent thereto if,
the assignee, subtenant, licensee, concessionaire or such other person is not capable
of performing or is not sufficiently qualified to perform in accordance with the
requirements of this Article 27.  Any
assignment, sublease, license or other permission to use the Premises from which
Landlord withholds its consent as provided in this Section 27.5 shall be
voidable at the Landlord’s sole option.


 


27.6                            Tenant’s Obligation
To Respond.  If Tenant’s Management of Hazardous
Materials at the Premises (i) gives rise to liability or to a Claim under any
Environmental Law, (ii) causes a significant public health effect, or (iii)
creates a nuisance, Tenant shall promptly take all applicable action in
Response.


 


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27.7                            Indemnification.  Tenant shall indemnify, defend and hold
harmless Landlord, its beneficiaries, its lenders, any managing agents and
leasing agents of the Premises, and their respective beneficiaries, agents,
partners, officers, directors and employees, from all Claims arising from or
attributable to: (a) the presence of Hazardous Materials in or on the Premises
or the subsurface thereof or the violation of any Environmental Laws (including,
without limiting the generality thereof, any cost, claim, liability or defense
expended in remediation required by a governmental authority or by reason of
the release, escape, seepage, leakage, discharge or migration of any Hazardous
Material on or from the Premises or violation of any Environmental Laws), or
(b) any breach by Tenant of any of its warranties, representations or covenants
in this Section.  Tenant’s obligations
hereunder shall survive the termination or expiration of this Lease.


 


ARTICLE 28


 


TITLE AND COVENANT AGAINST LIENS


 


28.1                            General.  Landlord’s title is and always shall be
paramount to the title of Tenant, and nothing in this Lease contained shall
empower Tenant to do any act which can, shall or may encumber the title of
Landlord.  Tenant covenants and agrees
not to suffer or permit any lien of mechanics or materialmen to be placed upon
or against the Premises or against Tenant’s leasehold interest in the Premises and,
in case of any such lien attaching, to immediately pay and remove same.  Tenant has no authority or power to cause or
permit any lien or encumbrance of any kind whatsoever, whether created by act
of Tenant, operation of law or otherwise, to attach to or be placed upon the
Premises and any and all liens and encumbrances created by Tenant shall attach
only to Tenant’s interest in the Premises. 
If any such liens so attach and Tenant fails to pay and remove same
within ten (10) days after notice thereof, Landlord, at its election, may pay
and satisfy the same, and in such event the sums so paid by Landlord shall
accrue with interest from the date of payment at the rate set forth in Section
29.8 hereof for amounts owed Landlord by Tenant.  Such sums shall be deemed to be additional
rent due and payable by Tenant at once without notice or demand.


 


28.2                            Title
Defects.  Landlord represents to Tenant
that Landlord has good and marketable fee simple title to Units 1 and 2 of the
Condominium and good and marketable leasehold title to Units 4 and 6 of the
Condominium, all as described in the Condominium Documents.  Landlord further represents to Tenant that Landlord
has obtained title insurance to insure its interest in the Premises.  Landlord hereby covenants that in the event
of any defect in or failure of title to the Premises, Landlord shall compensate
Tenant for any losses suffered by Tenant as a result thereof.


 


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ARTICLE 29


 


MISCELLANEOUS


 


29.1                            Successors
and Assigns.  Each provision of this Lease
shall extend to and shall bind and inure to the benefit not only of Landlord
and Tenant, but also their respective heirs, legal representatives, successors
and assigns, but this provision shall not operate to permit any transfer, assignment,
mortgage, encumbrance, lien, charge or subletting contrary to the provisions of
this Lease.


 


29.2                            Modifications
in Writing.  No modification, waiver or
amendment of this Lease or of any of its conditions or provisions shall be
binding upon either party unless in writing signed by such party.


 


29.3                            No Option;
Irrevocable Offer.  Submission of
this instrument for examination shall not constitute a reservation of or option
for the Premises or in any manner bind Landlord, and no lease or obligation of
Landlord shall arise until this instrument is signed and delivered by Landlord
and Tenant.


 


29.4                            Definition
of Tenant.  The word “Tenant”
whenever used herein shall be construed to mean Tenants or any one or more of
them in all cases where there is more than one Tenant; and the necessary
grammatical changes required to make the provisions hereof apply either to
corporations or other organizations, partnerships or other entities, or
individuals, shall in all cases be assumed as though in each case fully
expressed herein.  In all cases where
there is more than one Tenant, the liability of each shall be joint and
several.


 


29.5                            Definition
of Landlord.  The term “Landlord”
as used in this Lease means only the owner or owners at the time being of the
Premises so that in the event of any assignment, conveyance or sale, once or
successively, of said Premises, or any assignment of this Lease by Landlord,
said Landlord making such sale, conveyance or assignment shall be and hereby is
entirely freed and relieved of all covenants and obligations of Landlord
hereunder accruing after such sale, conveyance or assignment, and Tenant agrees
to look solely to such purchaser, grantee or assignee with respect thereto.  This Lease shall not be affected by any such
assignment, conveyance or sale, and Tenant agrees to attorn to the purchaser, grantee
or assignee.


 


29.6                            Headings.  The headings of Articles and Sections are for
convenience only and do not limit, expand or construe the contents of the
Sections.


 


29.7                            Time of
Essence.  Time is of the essence of this
Lease and of all provisions hereof.


 


29.8                            Default Rate
of Interest.  All amounts (including, without
limitation, Rent and Additional Rent) owed by Tenant to Landlord pursuant to
any


 


36





















 


 


provision
of this Lease and not paid within ten (10) days from the date when due shall
bear interest from the date due until paid at the annual rate of one percent
(1%) in excess of the rate of interest published from time to time in the Wall
Street Journal as the prime rate, changing as and when said prime rate
changes, unless a lesser rate shall then be the maximum rate permissible by law
with respect thereto, in which event said lesser rate shall be charged.


 


29.9                            Severability.  The invalidity of any provision of this Lease
shall not impair or affect in any manner the validity, enforceability or effect
of the rest of this Lease.


 


29.10                      Entire Agreement.  All understandings and agreements, oral or written,
heretofore made between the parties hereto are merged in this Lease, which
alone fully and completely expresses the agreement between Landlord (and its
beneficiary, if any, and their agents) and Tenant.


 


29.11                      Force Majeure.  If either party fails to timely perform any
of the terms, covenants and conditions of this Lease on its part to be performed
(other than relating to the payment of money) and such failure is due in whole
or in part to any strike, lockout, labor trouble, civil disorder, inability to
procure materials, failure of power, restrictive governmental laws and
regulations, riots, insurrections, war, fuel shortages, accidents, casualties, acts
of God, acts caused directly or indirectly by the other party (or the other
party’s agents, employees, contractors, licensees or invitees) or any other
cause beyond the reasonable control of such party, then such party shall not be
deemed in default under this Lease as a result of such failure and any time for
performance by such party provided for herein shall be extended by the period
of delay resulting from such cause.


 


29.12                      Signs.  Tenant may erect signs on the exterior or
interior of the Premises, provided that such sign or signs (i) do not cause any
structural damage or other damage to the Premises; (ii) do not violate
applicable governmental laws, ordinances, rules or regulations; (iii) do not
violate any covenants, conditions or restrictions affecting the Premises; and
(iv) are compatible with the architecture of the Premises.


 


29.13                      Waiver of Trial by Jury.  It is mutually agreed by and between Landlord
and Tenant that the respective parties hereto shall, and they hereby do, waive
trial by jury in any action, proceeding or counterclaim brought by either of the
parties hereto against the other on any matter whatsoever arising out of or in any
way connected with this Lease, the relationship of Landlord and Tenant, Tenant’s
use of or occupancy of the Premises or any claim of injury or damage and any
emergency statutory or any other statutory remedy.  If Landlord commences any summary proceeding
for nonpayment of Rent, Tenant will not interpose any counterclaim of whatever
nature or description in any such proceeding other than mandatory
counterclaims.


 


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29.14                      Relationship of Parties.  Nothing contained in this lease shall be deemed
or construed by the parties to this Lease, or by any third party, to create the
relationship of principal and agent, partnership, joint venture, lender and borrower,
or any association between Landlord and Tenant, it being expressly understood
and agreed that neither the method of computing Rent hereunder nor any other
provisions contained in this Lease nor any acts of the parties to this Lease shall
be deemed to create any relationship between Landlord and Tenant, other than
the leasehold relationship contemplated hereby.


 


29.15                      Liquor License.  Anything contained in this Lease to the
contrary notwithstanding, Tenant agrees that all of the net income received or
receivable from the operation of the Property shall, until such time as the New
York State Liquor Authority (“SLA”) has approved the Tenant’s application for a
Hotel Liquor License (the “License”) be held in trust by the Landlord.  If, as and when the Tenant is issued the
License, all net income from the operation of the Property from the date hereof
to the date of issuance of the License to the Tenant shall be promptly paid
over to the Tenant.  Landlord agrees to
cooperate with Tenant in obtaining the License. 
Landlord shall be in control of the Property until such time as the
earlier to occur of the issuance by the SLA of a (i) Temporary Retail Permit,
or (ii) a Hotel Liquor License.  All of
the foregoing is subject to the approval of the SLA.


 


29.16                      Allocation of Base Rent to Personal
Property.  Notwithstanding anything to the
contrary in this Lease, the portion of the Base Rent representing payment for
tangible personal property is as stipulated in or determined in accordance with
Exhibit  H, which is incorporated herein and made a part hereof.


 


ARTICLE 30


 


EXCULPATORY PROVISIONS


 


It is expressly understood and agreed by and between
the parties hereto, anything herein to the contrary notwithstanding, that each
and all of the representations, warranties, covenants, undertakings and
agreements herein made on the part of Landlord while in form purporting to be
the representations, warranties, covenants, undertakings and agreements of
Landlord are nevertheless each and every one of them made and intended, not as
personal representations, warranties, covenants, undertakings and agreements by
Landlord or for the purpose or with the intention of binding Landlord
personally, but are made and intended for the purpose only of subjecting
Landlord’s interest in the Premises to the terms of this Lease and for no other
purpose whatsoever, and in case of default hereunder by Landlord (or default
through, under or by any of its agents or representatives), Tenant shall look
solely to the interests of Landlord in the Premises; that neither Landlord nor
any of Landlord’s members or managers shall have any personal liability to pay
any indebtedness accruing hereunder or to perform any covenant,


 


38





















 


either
express or implied, herein contained.  Nothing
herein contained shall preclude injunctive or other equitable relief.


 


It is expressly understood and agreed by and between
the parties hereto, anything herein to the contrary notwithstanding, that each
and all of the representations, warranties, covenants, undertakings and
agreements herein made on the part of Tenant while in form purporting to be the
representations, warranties, covenants, undertakings and agreements of Tenant
are nevertheless each and every one of them made and intended, not as personal
representations, warranties, covenants, undertakings and agreements by Tenant
or for the purpose or with the intention of binding Tenant personally, but are
made and intended for the purpose only of subjecting Tenant’s interest in the
Premises to the terms of this Lease and for no other purpose whatsoever, and in
case of default hereunder by Tenant (or default through, under or by any of its
agents or representatives), Landlord shall look solely to the interests of
Tenant in the Premises; that neither Tenant nor any of Tenant’s members or
managers shall have any personal liability to pay any indebtedness accruing
hereunder or to perform any covenant, either express or implied, herein
contained.  Nothing herein contained
shall preclude injunctive or other equitable relief.


 


ARTICLE 31


 


SUBLEASE OF THE TENTH FLOOR LEASE


AND THE GROUND FLOOR LEASE


 


31.1                            For purposes of this
Lease, the portion of the Premises constituting the 10th floor of the Building
and the portion of the retail space located on the ground floor of the Building
which are, respectively, the subject premises of the Tenth Floor Lease and the
Ground Floor Lease shall be deemed to be subleased to Tenant in their entirety
(such portion of the Premises, the “Subleased Premises”),
and as it relates to the Subleased Premises, this Lease shall be deemed a
sublease (for purposes of this Article 31 only, this “Sublease”)
between Landlord, as sublessor, and Tenant, as sublessee.


 


31.2                            A.  This Sublease is subject and subordinate to all
of the terms, covenants and conditions of (i) the Tenth Floor Lease as it
pertains to the space leased thereby, and (ii) the Ground Floor Lease as it
pertains to the space leased thereby, and to the matters to which the Tenth
Floor Lease and the Ground Floor Lease respectively are or shall be subordinate.  A true and complete copy of the Tenth Floor
Lease is annexed hereto and made a part hereof as Exhibit  F.  A true and complete copy of the Ground Floor
Lease is annexed hereto and made a part hereof as Exhibit  G.  Tenant shall not do, or permit to be done,
anything that would constitute a breach or violation of any term, covenant, or
condition of each of the Tenth Floor Lease and Ground Floor Lease, respectively
or the building rules promulgated thereunder or other default under the Tenth
Floor Lease or Ground


 


39





















 


Floor
Lease, respectively on the part of Landlord, as tenant thereunder.  Notwithstanding anything to the contrary
contained in this Sublease, Tenant does not have any rights in respect of the
Subleased Premises greater than Landlord’s rights under each of the Tenth Floor
Lease or Ground Floor Lease respectively.


 


31.3                            All of the terms,
covenants and conditions contained in (i) the Tenth Floor Lease as it pertains
to the leased premises leased thereby, and (ii) the Ground Floor Lease as it
pertains to the leased premises leased thereby, are incorporated by reference
into this Lease.


 


31.4                            Tenant will look
solely to the landlord under either the Tenth Floor Lease or Ground Floor
Lease, respectively, for performance of the services and obligations specified
in the either the Tenth Floor Lease or the Ground Floor Lease, respectively, to
be provided or performed by such landlord thereunder, including, without limitation,
heat, ventilating and air conditioning, utilities, repairs, restoration,
alterations, reimbursement, cleaning, elevator service, hot and cold water and
light bulb replacement.  If such landlord
shall default or delay in the performance or observance of any of its
agreements or obligations under either the Tenth Floor Lease or the Ground
Floor Lease, respectively (including, but not limited to, any obligation for
the payment of money or to perform or furnish any work, services or utilities
at or to the Subleased Premises), Landlord shall have no obligation, liability
or responsibility therefor to Tenant and Landlord shall be excused from the
performance or observance of the corresponding obligation, if any, which may be
owed by Landlord to Tenant under this Sublease. 
Any condition resulting from such default or delay by the Landlord under
either the Tenth Floor Lease or the Ground Floor Lease, respectively, shall not
constitute an eviction, actual or constructive, of Tenant.  No such default or delay shall excuse Tenant from
the performance or observance of any of its obligations to be performed or observed
under this Sublease or shall entitle Tenant to terminate this Sublease or to
any reduction in or abatement of the rent or other charges provided for in this
Sublease.  In furtherance of the
foregoing, Tenant does, to the extent permitted by law, and except for the
willful misconduct or gross negligence of Landlord, hereby waive any cause of
action and any right to bring an action against Landlord (but not against the
respective landlords under the Master Leases) by reason of any act or omission
of either landlord under either the Tenth Floor Lease or the Ground Floor Lease,
respectively.


 


31.5                            Tenant shall comply
with the insurance requirements imposed upon Landlord as “Tenant” under the
respective Insurance sections of either the Tenth Floor Lease or the Ground
Floor Lease, respectively, as incorporated herein.  Such insurance shall name Landlord as an
additional insured, in addition to the other entities which are required to be
named as additional insureds pursuant to the terms of either the Tenth Floor
Lease or the Ground Floor Lease, respectively. 
Tenant shall furnish Landlord and the respective landlords under both
the Tenth


 


40





















 


Floor
Lease or Ground Floor Lease, with certificates evidencing such insurance prior
to the Commencement Date.


 


31.6                           Tenant also covenants
as follows:


 


(a)                                  Tenant hereby assumes
and agrees to perform and comply with all of the terms, covenants and
conditions of each of the Master Leases, respectively, on the part of the tenant
thereunder to be performed and observed as they relate to the Subleased
Premises, other than as expressly set forth in this Lease.


 


(b)                                 Tenant will not do or
cause to be done or suffer or permit any act or thing to be done or suffered
which would or might constitute a default under either the Tenth Floor Lease or
the Ground Floor Lease, respectively, or cause either the Tenth Floor Lease or
the Ground Floor Lease, respectively or the rights of Landlord, as tenant
thereunder, to be terminated or which would or might cause Landlord to become
liable for any damages, costs, claims or penalties or would or might increase
the fixed rent, additional rent or other charges or obligations of Landlord, as
tenant under either the Tenth Floor Lease or the Ground Floor Lease,
respectively, or would or might adversely affect or reduce any of Landlord’s
rights or benefits under either the Tenth Floor Lease or the Ground Floor
Lease, respectively.


 


(c)                                  Tenant shall defend,
indemnify and hold Landlord and any guarantor of Landlord’s obligations as
tenant under either the Tenth Floor Lease or the Ground Floor Lease,
respectively, harmless from and against any and all claims, actions,
liabilities, losses, damages, costs and expenses (including, without
limitation, reasonable attorneys’ fees and disbursements) arising from the use
or occupancy by Tenant of the Subleased Premises or the Premises or from any
work or thing done or any condition created by or any other act or omission of
Tenant or its employees, agents, contractors, visitors or licensees, in or
about the Subleased Premises or any other part of the Premises, or from any
breach of its obligations under either the Tenth Floor Lease or the Ground Floor
Lease, respectively.  The provisions of
this subsection C shall survive the expiration or earlier termination of this Sublease.


 


(d)                                 Landlord shall
perform and comply with all of the terms, covenants and conditions of either
the Tenth Floor Lease or the Ground Floor Lease, respectively, on its part to
be performed and observed, other than to the extent that any failure to perform
shall have resulted from any default by Tenant hereunder, and Landlord will not
do anything that would cause either the Tenth Floor Lease or the Ground Floor Lease,
respectively, to be terminated or modified so as to adversely affect the rights
of Tenant under this Sublease.


 


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(e)                                  Landlord and Tenant
each promptly shall furnish to the other copies of any notices of default given
by either landlord under either the Tenth Floor Lease or the Ground Floor
Lease, respectively, to Landlord or Tenant, as the case may be.


 


31.7                           In the event of and
upon the termination or cancellation of either the Tenth Floor Lease or the
Ground Floor Lease, respectively, pursuant to any of the provisions thereof,
whether or not the Commencement Date of this Sublease shall have occurred, this
Sublease shall automatically expire and terminate and shall be of no further
force and effect.


 


REMAINDER
OF THIS PAGE LEFT INTENTIONALLY BLANK.


SIGNATURE
PAGE TO FOLLOW.


 


42





















 


Signature page for the Lease:


 


IN WITNESS WHEREOF, the parties hereto
have caused this Lease to be executed as of the date first written above.


 


	
   

  	
  LANDLORD:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  HENRY
  HUDSON HOLDINGS LLC,

  
	
   

  	
  a
  Delaware limited liability company

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
     /s/ Steven B. Kauff

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Steven B. Kauff

  
	
   

  	
   

  	
  Title:

  	
  Authorized
  Signatory

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TENANT:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  HUDSON
  LEASECO LLC, a New York

  limited liability company

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  HUDSON MANAGING MEMBER LLC,

  a Delaware limited liability company, its Managing Member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
    /s/ Steven B. Kauff

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Steven B. Kauff

  
	
   

  	
   

  	
  Title:

  	
  Authorized
  Signatory

  
							



 


43


















 


EXHIBIT A


 


Legal Description


 


UNIT LOT 1701:


 


The
condominium unit known as Unit 1 (also known as the EBC Unit) (hereinafter
referred to as “Unit Lot 1701”), in the building (hereinafter referred to as
the “Building”) known as 353 West 57th Street Condominium and by the street
number 353 West 57th Street, New York, New York, said Unit being
designated and described in a certain declaration dated April 11, 1985
made by Irving Schatz pursuant to Article 9-B of the Real Property Law of
the State of New York establishing a plan for condominium ownership of the
Building and the land (hereinafter referred to as the “Land”) upon which the
Building is situate (which Land is more particularly described below), which
declaration was recorded in the New York County Office of the Register of The
City of New York (the “City Register’s Office”) on April 24, 1985 in
Reel 902 page 1 and amended by First Amendment to Declaration dated January 29,
1993 and recorded May 11, 1993 in Reel 1969 page 2286, by Amended and
Restated Declaration made by Henry Hudson Holdings LLC, Irving Schatz, Adrienne
Wechsler and Cheryl Hirsch, dated as of February 12, 1999 and recorded in
the City Register’s Office July 16, 1999 in Reel 2913, page 1753 and
by First Amendment to Amended and Restated Declaration made by Henry Hudson
Holdings LLC, Irving Schatz, Adrienne Wechsler and Cheryl Hirsch, dated as of September 30,
1999 and recorded in the City Register’s Office October 27, 1999 in Reel
2979, page 2159 (which declaration, as amended, is hereinafter referred to
as the “Declaration”). The Units are also designated as Tax Lots 1701 in Block
1048 of Section 4 of the Borough of Manhattan on the Tax Map of the Real
Property Assessment Department of the City of New York and on the Floor Plans
of the Building, certified by Butler Rogers Baskett, Architects, on March 27,
1985 and filed in the Real Property Assessment Department of the City of New
York on April 22, 1985 as Condominium Plan No. 208 and also filed in
the City Register’s Office on April 24, 1985 as Condominium Map No. 4326,
as amended by Amended Floor Plans certified by Butler Rogers Baskett,
Architects, on December 14, 1992, which Amended Floor Plans were filed in
the Real Property Assessment Department of the City of New York on May 5,
1993 as Condominium Plan No. 208A and also filed in the City Register’s
Office on May 11, 1993 as Condominium Map No. 5192.


 


TOGETHER
WITH an undivided 44.05105% interest in the Common Elements (as such term is
defined in the Declaration).


 


UNIT LOT 1702:


 


The condominium unit
(hereinafter referred to as “Unit Lot 1702”) known as Unit 2, also known as the
Modified Hotel Unit, in the Building, said Unit being designated and described
in the Declaration. Unit Lot 1702 is also designated as Tax Lot 1702 in Block 1048
of Section 4 of the Borough of Manhattan on the Tax Map of the Real
Property Assessment


 





















 


Department of the City of New York and on the Floor
Plans of the Building, certified by Butler Rogers Baskett, Architects, on March 27,
1985 and filed in the Real Property Assessment Department of the City of New
York on April 22, 1985 as Condominium Plan No. 208 and also filed in
the City Register’s Office on April 24, 1985 as Condominium Map No. 4326,
as amended by Amended Floor Plans certified by Butler Rogers Baskett,
Architects, on December 14, 1992, which Amended Floor Plans were filed in
the Real Property Assessment Department of the City of New York on May 5,
1993 as Condominium Plan No. 208A and also filed in the City Register’s
Office on May 11, 1993 as Condominium Map No. 5192.


 


TOGETHER
WITH an undivided 46.94011% interest in the Common Elements (as such term is
defined in the Declaration).


 


UNIT LOT 1704


 


The leasehold estate created
under that certain Lease dated January, 1999 by and between Adrienne Schatz and
Cheryl Hirsch, as lessor and Mortgagor, as lessee, as amended by Amendment to
Lease dated as of September 30, 1999 between lessor and Mortgagor, both as
referenced in Memorandum of Lease dated as of September 30, 1999 between
lessor and Mortgagor and recorded with the City Register’s Office on October 27,
1999 in Reel 2979 page 2172, and covering premises more particularly
bounded and described as follows:


 


The
condominium unit (hereinafter referred to as “Unit Lot 1704”) known as Unit 4,
also known as the Store Unit in the Building, said Unit being designated and
described in the Declaration. Unit Lot 1704 is also designated as Tax Lot 1704
in Block 1048 of Section 4 of the Borough of Manhattan on the Tax Map
of the Real Property Assessment Department of the City of New York and on the
Floor Plans of the Building, certified by Butler Rogers Baskett, Architects, on
March 27, 1985 and filed in the Real Property Assessment Department of the
City of New York on April 22, 1985 as Condominium Plan No. 208 and
also filed in the City Register’s Office on April 24, 1985 as Condominium
Map No. 4326, as amended by Amended Floor Plans certified by Butler Rogers
Baskett, Architects, on December 14, 1992, which Amended Floor Plans were
filed in the Real Property Assessment Department of the City of New York on May 5,
1993 as Condominium Plan No. 208A and also filed in the City Register’s
Office on May 11, 1993 as Condominium Map No. 5192.


 


TOGETHER
WITH an undivided .34577% interest in the Common Elements (as such term is
defined in the Declaration).


 


UNIT LOT 1706


 


The
leasehold estate created under that certain Amended and Restated Lease dated as
of February 11, 1999 by and between Irving Schatz, as lessor, and Ian
Schrager Hotels LLC,


 


6





















 


as lessee, as referenced in Amended and Restated
Memorandum of Lease dated as of February 12, 1999 and recorded in the City
Register’s Office March 23, 1999 in Reel 1841, page 1872, as assigned
by Ian Schrager Hotels LLC to Henry Hudson Holdings LLC by Assignment and
Assumption Agreement dated as of February 12, 1999 and recorded in the
City Register’s Office March 23, 1999 in Reel 2841, page 1882,
covering premises more particularly bounded and described as follows:


 


The
condominium unit (hereinafter referred to as “Unit Lot 1706”) known as Unit 6,
also known as the Tenth Floor Unit in the Building, said Unit being designated
and described in the Declaration. Unit Lot 1706 is also designated as Tax Lot
1706 in Block 1048 of Section 4 of the Borough of Manhattan on the Tax Map
of the Real Property Assessment Department of the City of New York and on the
Floor Plans of the Building, certified by Butler Rogers Baskett, Architects, on
March 27, 1985 and filed in the Real Property Assessment Department of the
City of New York on April 22, 1985 as Condominium Plan No. 208 and
also filed in the City Register’s Office on April 24, 1985 as Condominium
Map No. 4326, as amended by Amended Floor Plans certified by Butler Rogers
Baskett, Architects, on December 14, 1992, which Amended Floor Plans were
filed in the Real Property Assessment Department of the City of New York on May 5,
1993 as Condominium Plan No. 208A and also filed in the City Register’s
Office on May 11, 1993 as Condominium Map No. 5192.


 


TOGETHER WITH an undivided
3.89067% interest in the Common Elements (as such term is defined in the
Declaration).


 


The
Land upon which the Building containing Unit Lots 1701, 1702, 1704 and 1706 is
situate is bounded and described as follows:


 


ALL that certain plot, piece
or parcel of land, situate, lying and being in the Borough of Manhattan, County
of New York, City and State of New York, bounded and described as follows:


 


BEGINNING at a point on the
northerly side of 57th Street, distant 20 feet easterly from the comer formed
by the intersection of the easterly side of Ninth Avenue with the
northerly side of 57th Street;


 


RUNNING
THENCE easterly along the said northerly side of 57th Street, 155 feet;


 


THENCE northerly parallel
with Ninth Avenue, 200 feet 10 inches to the southerly side of 58th Street;


 


THENCE westerly along the
said southerly side of 58th Street, 135 feet to a point distant 40 feet
easterly from the corner formed by the intersection of the southerly side
of 58th Street with the easterly side of Ninth Avenue;


 


7





















 


THENCE
southerly parallel with Ninth Avenue and part of the distance through a party
wall, 100 feet 10 inches;


 


THENCE westerly parallel
more or less with 58th Street, 20 feet; and


 


THENCE
southerly and part of the way through another party wall, 100 feet to the
northerly side of 57th Street, the point or place of BEGINNING.


 


8





















 


EXHIBIT B


 


Subleases


 


1.                                      
Lease
Dated as of June   , 2000, by and between Henry Hudson Holdings LLC and SC 58th Street LLC.


 


2.                                      
Legal
rights of SRO tenants (list attached)


 


HUDSON HOTEL – SRO TENANTS


 


WEEKLY RATES


 


	
  Name

  	
   

  	
  Room #

  	
   

  	
  Arrival

  	
   

  	
  Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Gookin, Vincent

  	
   

  	
  1217

  	
   

  	
  7/19/77

  	
   

  	
  $

  	
  151.24

  	
   

  
	
  Hearst, Patrick

  	
   

  	
  1270

  	
   

  	
  8/4/71

  	
   

  	
  $

  	
  87.78

  	
   

  
	
  Natos, Nick

  	
   

  	
  1516

  	
   

  	
  5/18/81

  	
   

  	
  $

  	
  101.11

  	
   

  
	
  Arjune, Harry

  	
   

  	
  1632

  	
   

  	
  2/28/83

  	
   

  	
  $

  	
  116.48

  	
   

  
	
  O’Malley, Robert

  	
   

  	
  1700

  	
   

  	
  5/1/66

  	
   

  	
  $

  	
  83.03

  	
   

  
	
  Zadar, Renee

  	
   

  	
  1755

  	
   

  	
  7/7/81

  	
   

  	
  $

  	
  101.12

  	
   

  
	
  Pavese, Thomas

  	
   

  	
  1802

  	
   

  	
  3/27/72

  	
   

  	
  $

  	
  92.61

  	
   

  
	
  Aris, Richard

  	
   

  	
  1805

  	
   

  	
  5/20/70

  	
   

  	
  $

  	
  86.65

  	
   

  
	
  Cooper, Daryl

  	
   

  	
  1817

  	
   

  	
  8/17/84

  	
   

  	
  $

  	
  134.92

  	
   

  
	
  Morrow, Janette

  	
   

  	
  1834

  	
   

  	
  9/1/82

  	
   

  	
  $

  	
  101.11

  	
   

  
	
  Ledesma, Lucy

  	
   

  	
  1838

  	
   

  	
  7/19/82

  	
   

  	
  $

  	
  74.03

  	
   

  
	
  Gilliam, Susan

  	
   

  	
  1844

  	
   

  	
  4/24/76

  	
   

  	
  $

  	
  95.01

  	
   

  
	
  Levi, Emil

  	
   

  	
  1846

  	
   

  	
  9/4/79

  	
   

  	
  $

  	
  101.11

  	
   

  
	
  Johnson, Charles

  	
   

  	
  1850

  	
   

  	
  3/12/82

  	
   

  	
  $

  	
  121.70

  	
   

  
	
  Diamond, Al

  	
   

  	
  1901

  	
   

  	
  5/22/80

  	
   

  	
  $

  	
  76.70

  	
   

  
	
  Levine, Aaron

  	
   

  	
  2010

  	
   

  	
  4/17/77

  	
   

  	
  $

  	
  93.87

  	
   

  
	
  Magno, Zoe

  	
   

  	
  2017

  	
   

  	
  11/30/79

  	
   

  	
  $

  	
  101.11

  	
   

  
	
  Giannoutsos, Mike

  	
   

  	
  2029

  	
   

  	
  11/22/83

  	
   

  	
  $

  	
  121.12

  	
   

  
	
  Murphy, Francis

  	
   

  	
  2030

  	
   

  	
  2/26/71

  	
   

  	
  $

  	
  93.87

  	
   

  
	
  Stapleton, Sean

  	
   

  	
  2032

  	
   

  	
  4/27/78

  	
   

  	
  $

  	
  128.65

  	
   

  
	
  Mendes, Larry

  	
   

  	
  2038

  	
   

  	
  12/5/79

  	
   

  	
  $

  	
  101.11

  	
   

  
	
  Dana Bate

  	
   

  	
  2043

  	
   

  	
  1/11/82

  	
   

  	
  $

  	
  101.11

  	
   

  
	
  Tannenbaum, William

  	
   

  	
  2050

  	
   

  	
  9/25/80

  	
   

  	
  $

  	
  101.11

  	
   

  
	
  Glicksman, Hal

  	
   

  	
  2057

  	
   

  	
  9/8/82

  	
   

  	
  $

  	
  114.45

  	
   

  
	
  Kanturek, Joseph

  	
   

  	
  2106

  	
   

  	
  2/19/74

  	
   

  	
  $

  	
  87.73

  	
   

  
	
  Schor, Maxwell

  	
   

  	
  2115

  	
   

  	
  6/1/77

  	
   

  	
  $

  	
  95.01

  	
   

  
	
  Hirsch, Judy

  	
   

  	
  2155

  	
   

  	
  9/25/67

  	
   

  	
  $

  	
  87.77

  	
   

  
	
  Robinson, Charles

  	
   

  	
  2207

  	
   

  	
  10/30/73

  	
   

  	
  $

  	
  97.35

  	
   

  
	
  Price, Robert

  	
   

  	
  2235

  	
   

  	
  10/10/77

  	
   

  	
  $

  	
  95.01

  	
   

  
	
  Imani, Mohammed

  	
   

  	
  2250

  	
   

  	
  9/5/80

  	
   

  	
  $

  	
  101.11

  	
   

  
	
  Altman, Richard

  	
   

  	
  2252

  	
   

  	
  6/20/83

  	
   

  	
  $

  	
  101.70

  	
   

  
	
  Martell, Ann

  	
   

  	
  2255

  	
   

  	
  11/15/81

  	
   

  	
  $

  	
  101.11

  	
   

  
	
  Griffin, Jane

  	
   

  	
  2257

  	
   

  	
  5/23/69

  	
   

  	
  $

  	
  95.01

  	
   

  
	
  Total

  	
   

  	
  33

  	
   

  	
   

  	
   

  	
  $

  	
  3,312.80

  	
   

  



 





















 


MONTHLY RATES


 


	
  Name

  	
   

  	
  Room #

  	
   

  	
  Arrival

  	
   

  	
  Rent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Simmons, Arlene

  	
   

  	
  1169

  	
   

  	
  9/5/88

  	
   

  	
  $

  	
  519.80

  	
   

  
	
  Hirschberg

  	
   

  	
  1443

  	
   

  	
  10/29/59

  	
   

  	
  $

  	
  391.13

  	
   

  
	
  Vendromin

  	
   

  	
  1457

  	
   

  	
  9/3/94

  	
   

  	
  $

  	
  525.00

  	
   

  
	
  Radunovich, Milan

  	
   

  	
  1546

  	
   

  	
  1/13/77

  	
   

  	
  $

  	
  437.48

  	
   

  
	
  Leach, Ken

  	
   

  	
  1702

  	
   

  	
  11/1/85

  	
   

  	
  $

  	
  519.80

  	
   

  
	
  Gilbert, Fred

  	
   

  	
  1721

  	
   

  	
  5/25/68

  	
   

  	
  $

  	
  296.05

  	
   

  
	
  Brady, Homer

  	
   

  	
  1722

  	
   

  	
  2/16/77

  	
   

  	
  $

  	
  411.71

  	
   

  
	
  McDermott, Christine

  	
   

  	
  1745

  	
   

  	
  4/20/74

  	
   

  	
  $

  	
  405.17

  	
   

  
	
  Bichai, George

  	
   

  	
  1753

  	
   

  	
  9/25/83

  	
   

  	
  $

  	
  508.87

  	
   

  
	
  Kim, Jung

  	
   

  	
  1754

  	
   

  	
  9/16/82

  	
   

  	
  $

  	
  494.30

  	
   

  
	
  McKendall, Abigail

  	
   

  	
  1756

  	
   

  	
  5/24/85

  	
   

  	
  $

  	
  554.97

  	
   

  
	
  Hengwatanakul, Muntana

  	
   

  	
  1757

  	
   

  	
  2/1/76

  	
   

  	
  $

  	
  288.34

  	
   

  
	
  Tahil, Miriam (daughter)

  	
   

  	
  1801

  	
   

  	
  12/17/79

  	
   

  	
  $

  	
  227.05

  	
   

  
	
  Velasquez, Blanca

  	
   

  	
  1806

  	
   

  	
  6/17/81

  	
   

  	
  $

  	
  491.09

  	
   

  
	
  Debe, Carmen

  	
   

  	
  1807

  	
   

  	
  7/4/79

  	
   

  	
  $

  	
  493.92

  	
   

  
	
  Kirsten, Bertha

  	
   

  	
  1810

  	
   

  	
  10/31/67

  	
   

  	
  $

  	
  192.09

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cannon, Harry

  	
   

  	
  1811

  	
   

  	
  1/7/82

  	
   

  	
  $

  	
  438.14

  	
   

  
	
  Bichai, Anthony

  	
   

  	
  1812

  	
   

  	
  6/24/82

  	
   

  	
  $

  	
  438.17

  	
   

  
	
  Gore, Marcia

  	
   

  	
  1822

  	
   

  	
  12/14/75

  	
   

  	
  $

  	
  490.81

  	
   

  
	
  Turner, Conrad

  	
   

  	
  1828

  	
   

  	
  9/29/77

  	
   

  	
  $

  	
  435.31

  	
   

  
	
  Johnson, Lola

  	
   

  	
  1829

  	
   

  	
  8/28/72

  	
   

  	
  $

  	
  377.19

  	
   

  
	
  Michalicka, Helen

  	
   

  	
  1831

  	
   

  	
  11/6/66

  	
   

  	
  $

  	
  254.32

  	
   

  
	
  Carroll, William

  	
   

  	
  1832

  	
   

  	
  8/16/80

  	
   

  	
  $

  	
  438.15

  	
   

  
	
  Saffran, Bessie

  	
   

  	
  1833

  	
   

  	
  7/17/84

  	
   

  	
  $

  	
  253.17

  	
   

  
	
  Mothley, Chadee

  	
   

  	
  1835

  	
   

  	
  10/22/75

  	
   

  	
  $

  	
  412.67

  	
   

  
	
  Dembro, Al

  	
   

  	
  1839

  	
   

  	
  3/31/68

  	
   

  	
  $

  	
  393.95

  	
   

  
	
  Khan, Kawasa

  	
   

  	
  1840

  	
   

  	
  8/19/77

  	
   

  	
  $

  	
  438.64

  	
   

  
	
  Forbes, Herman

  	
   

  	
  1843

  	
   

  	
  8/23/69

  	
   

  	
  $

  	
  414.30

  	
   

  
	
  Krieger

  	
   

  	
  1852

  	
   

  	
  1/23/96

  	
   

  	
  $

  	
  574.99

  	
   

  
	
  Palma, Flora

  	
   

  	
  1853

  	
   

  	
  3/1/76

  	
   

  	
  $

  	
  421.26

  	
   

  
	
  Armstrong

  	
   

  	
  1855

  	
   

  	
  6/4/73

  	
   

  	
  $

  	
  411.71

  	
   

  
	
  Lamb, Owen

  	
   

  	
  1916

  	
   

  	
  9/10/79

  	
   

  	
  $

  	
  415.38

  	
   

  
	
  Gilana, Carmelita

  	
   

  	
  2002

  	
   

  	
  11/10/73

  	
   

  	
  $

  	
  437.47

  	
   

  
	
  Nebenzahl, John

  	
   

  	
  2004

  	
   

  	
  10/23/83

  	
   

  	
  $

  	
  500.98

  	
   

  
	
  Brown, Willie

  	
   

  	
  2005

  	
   

  	
  4/20/71

  	
   

  	
  $

  	
  450.22

  	
   

  
	
  Collins, Jack

  	
   

  	
  2006

  	
   

  	
  8/12/83

  	
   

  	
  $

  	
  760.89

  	
   

  
	
  Samaroo, Jean

  	
   

  	
  2007

  	
   

  	
  7/15/77

  	
   

  	
  $

  	
  435.16

  	
   

  
	
  Aylaian

  	
   

  	
  2011

  	
   

  	
  11/15/72

  	
   

  	
  $

  	
  375.26

  	
   

  
	
  Dei

  	
   

  	
  2015

  	
   

  	
  4/24/85

  	
   

  	
  $

  	
  401.98

  	
   

  
	
  Tahil, Miriam (mother)

  	
   

  	
  2016

  	
   

  	
  11/10/81

  	
   

  	
  $

  	
  562.73

  	
   

  
	
  Doyle, Louis

  	
   

  	
  2022

  	
   

  	
  11/16/67

  	
   

  	
  $

  	
  375.05

  	
   

  
	
  Reddy, Kenneth

  	
   

  	
  2023

  	
   

  	
  7/13/75

  	
   

  	
  $

  	
  411.71

  	
   

  



 


2





















 


	
  Samol, Carl

  	
   

  	
  2025

  	
   

  	
  4/28/81

  	
   

  	
  $

  	
  438.15

  	
   

  
	
  Panday, Richelle

  	
   

  	
  2027

  	
   

  	
  11/10/75

  	
   

  	
  $

  	
  435.16

  	
   

  
	
  Carter, Teresa

  	
   

  	
  2031

  	
   

  	
  5/1/77

  	
   

  	
  $

  	
  440.96

  	
   

  
	
  Moroulis, George

  	
   

  	
  2034

  	
   

  	
  8/29/79

  	
   

  	
  $

  	
  448.29

  	
   

  
	
  Strater, Rosa

  	
   

  	
  2035

  	
   

  	
  12/23/66

  	
   

  	
  $

  	
  364.38

  	
   

  
	
  Rosario, Elizabeth

  	
   

  	
  2039

  	
   

  	
  10/20/69

  	
   

  	
  $

  	
  404.73

  	
   

  
	
  Minic, Micheal

  	
   

  	
  2040

  	
   

  	
  9/9/86

  	
   

  	
  $

  	
  589.35

  	
   

  
	
  Garinis, John

  	
   

  	
  2044

  	
   

  	
  2/16/74

  	
   

  	
  $

  	
  278.65

  	
   

  
	
  Ortubia, Alberta

  	
   

  	
  2045

  	
   

  	
  2/25/78

  	
   

  	
  $

  	
  520.95

  	
   

  
	
  Lagarde/Berge, Evelyn

  	
   

  	
  2046

  	
   

  	
  10/29/71

  	
   

  	
  $

  	
  435.16

  	
   

  
	
  Proctor, Carolyn

  	
   

  	
  2053

  	
   

  	
  10/6/58

  	
   

  	
  $

  	
  497.78

  	
   

  
	
  Dixon, Lester

  	
   

  	
  2102

  	
   

  	
  5/6/77

  	
   

  	
  $

  	
  491.97

  	
   

  
	
  McLang, Rosario

  	
   

  	
  2103

  	
   

  	
  1/29/78

  	
   

  	
  $

  	
  411.71

  	
   

  
	
  Gassette, Roxine

  	
   

  	
  2107

  	
   

  	
  8/31/80

  	
   

  	
  $

  	
  503.57

  	
   

  
	
  Silagowsky

  	
   

  	
  2111

  	
   

  	
  9/25/82

  	
   

  	
  $

  	
  495.90

  	
   

  
	
  Seeparsad

  	
   

  	
  2112

  	
   

  	
  1/29/96

  	
   

  	
  $

  	
  561.00

  	
   

  
	
  Rodriguez, Yolanda

  	
   

  	
  2114

  	
   

  	
  3/5/80

  	
   

  	
  $

  	
  561.81

  	
   

  
	
  Brockenborough, Pat

  	
   

  	
  2117

  	
   

  	
  1/7/74

  	
   

  	
  $

  	
  411.71

  	
   

  
	
  Padelski, Frank

  	
   

  	
  2129

  	
   

  	
  8/30/74

  	
   

  	
  $

  	
  435.85

  	
   

  
	
  Reed, Melody

  	
   

  	
  2127

  	
   

  	
  12/3/85

  	
   

  	
  $

  	
  472.10

  	
   

  
	
  Cady, Maria

  	
   

  	
  2133

  	
   

  	
  10/1/84

  	
   

  	
  $

  	
  720.36

  	
   

  
	
  Balmaceda, Clara

  	
   

  	
  2134

  	
   

  	
  10/13/75

  	
   

  	
  $

  	
  486.17

  	
   

  
	
  Grimes, Richard

  	
   

  	
  2135

  	
   

  	
  8/30/75

  	
   

  	
  $

  	
  440.97

  	
   

  
	
  Quiogue, Yolanda

  	
   

  	
  2138

  	
   

  	
  8/29/80

  	
   

  	
  $

  	
  503.57

  	
   

  
	
  Rodriguez, Maria

  	
   

  	
  2139

  	
   

  	
  1/28/83

  	
   

  	
  $

  	
  359.06

  	
   

  
	
  Hale, Birdie

  	
   

  	
  2140

  	
   

  	
  4/3/71

  	
   

  	
  $

  	
  449.08

  	
   

  
	
  Sanchez, Bonifacio

  	
   

  	
  2145

  	
   

  	
  10/29/71

  	
   

  	
  $

  	
  274.03

  	
   

  
	
  Buitargo, Jackie

  	
   

  	
  2146

  	
   

  	
  6/17/76

  	
   

  	
  $

  	
  523.28

  	
   

  
	
  Salazar, Adiela Gloria

  	
   

  	
  2152

  	
   

  	
  8/8/84

  	
   

  	
  $

  	
  585.13

  	
   

  
	
  Foley, Willian

  	
   

  	
  2153

  	
   

  	
  3/16/75

  	
   

  	
  $

  	
  435.16

  	
   

  
	
  Schwantes, Claudia

  	
   

  	
  2157

  	
   

  	
  4/22/81

  	
   

  	
  $

  	
  438.15

  	
   

  
	
  Montenero, Winifred

  	
   

  	
  2204

  	
   

  	
  3/15/75

  	
   

  	
  $

  	
  396.94

  	
   

  
	
  Jiminez, Segundo

  	
   

  	
  2205

  	
   

  	
  9/12/79

  	
   

  	
  $

  	
  503.57

  	
   

  
	
  Cowie, Margaret

  	
   

  	
  2206

  	
   

  	
  10/3/82

  	
   

  	
  $

  	
  556.88

  	
   

  
	
  Nathanial

  	
   

  	
  2211

  	
   

  	
  7/11/94

  	
   

  	
  $

  	
  423.57

  	
   

  
	
  Phyu, Hnin, Hla

  	
   

  	
  2212

  	
   

  	
  5/12/72

  	
   

  	
  $

  	
  434.01

  	
   

  
	
  Carfagna, Joe

  	
   

  	
  2214

  	
   

  	
  1/27/84

  	
   

  	
  $

  	
  628.31

  	
   

  
	
  Chane, Peggy

  	
   

  	
  2227

  	
   

  	
  1/14/69

  	
   

  	
  $

  	
  261.27

  	
   

  
	
  Hernandez, Nieves

  	
   

  	
  2229

  	
   

  	
  7/5/79

  	
   

  	
  $

  	
  503.57

  	
   

  
	
  Blakely, Faye

  	
   

  	
  2231

  	
   

  	
  7/2/78

  	
   

  	
  $

  	
  503.03

  	
   

  
	
  Ramos, Leticia

  	
   

  	
  2232

  	
   

  	
  4/5/81

  	
   

  	
  $

  	
  473.43

  	
   

  
	
  Morton, Guy

  	
   

  	
  2236

  	
   

  	
  9/8/78

  	
   

  	
  $

  	
  453.89

  	
   

  
	
  Chin, Daisy

  	
   

  	
  2239

  	
   

  	
  12/3/70

  	
   

  	
  $

  	
  421.26

  	
   

  
	
  Furgeri, Vittorio

  	
   

  	
  2240

  	
   

  	
  9/8/72

  	
   

  	
  $

  	
  438.65

  	
   

  
	
  Bendana, Renata

  	
   

  	
  2244

  	
   

  	
  7/26/82

  	
   

  	
  $

  	
  525.58

  	
   

  
	
  Schatz, Gary

  	
   

  	
  2245

  	
   

  	
  1/29/74

  	
   

  	
  $

  	
  938.41

  	
   

  
	
  Lavilla, Amparoo

  	
   

  	
  2253

  	
   

  	
  12/25/75

  	
   

  	
  $

  	
  475.75

  	
   

  



 


3





















 


	
  Russell, Nipsey

  	
   

  	
  2343

  	
   

  	
  6/5/67

  	
   

  	
  $

  	
  178.54

  	
   

  
	
  Total

  	
   

  	
  90

  	
   

  	
   

  	
   

  	
  $

  	
  40,607.18

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total SRO = 123

  	
   

  	
   

  	
   

  	
  4 Weeks

  	
   

  	
  $

  	
  53,978.38

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  5 Weeks

  	
   

  	
  $

  	
  57,321.18

  	
   

  



 


4





















 


EXHIBIT C


 


Operating
Contracts


 


	
   

  	
   

  	
   

  	
   

  	
  Contract

  	
   

  	
  Contract

  Expiration

  	
   

  	
  Amount

  	
   

  
	
  Name Of
  Vendor

  	
   

  	
  Description

  	
   

  	
  Start Date

  	
   

  	
  Date

  	
   

  	
  Monthly

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Service Agreements

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  York International

  	
   

  	
  Chillers

  	
   

  	
  03/01/2000

  	
   

  	
  12/31/2000

  	
   

  	
  $

  	
  3,000.00

  	
   

  
	
  Rapid Armoured Corp.

  	
   

  	
  Armoured car delivery

  	
   

  	
  02/01/2000

  	
   

  	
  02/01/2001

  	
   

  	
  $

  	
  134.00

  	
   

  
	
  Gold Valet Service

  	
   

  	
  Valet and Uniforms

  	
   

  	
  07/21/2000

  	
   

  	
  07/21/2001

  	
   

  	
  —

  	
   

  
	
  Abalon Exterminating Company

  	
   

  	
  Pest control services

  	
   

  	
  09/30/2000

  	
   

  	
  08/31/2001

  	
   

  	
  $

  	
  1,840.00

  	
   

  
	
  IESI NY Corporation

  	
   

  	
  Waste collection

  	
   

  	
  Sep-00

  	
   

  	
  09/01/2001

  	
   

  	
  $

  	
  6,466.51

  	
   

  
	
  Tartan Textile
  Services, Inc.

  	
   

  	
  Laundry services

  	
   

  	
  10/03/2000

  	
   

  	
  10/03/2001

  	
   

  	
   

  	
   

  
	
  GSS Security Services Inc.

  	
   

  	
  Security

  	
   

  	
  12/14/1999

  	
   

  	
  12/14/2001

  	
   

  	
   

  	
   

  
	
  NUCO2 Inc.

  	
   

  	
  co2 cylinders

  	
   

  	
  07/11/2000

  	
   

  	
  07/11/2006

  	
   

  	
  $

  	
  105.00

  	
   

  
	
  ADT

  	
   

  	
  Fire alarm monitoring

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  464.29

  	
   

  
	
  DMX Music

  	
   

  	
  Music

  	
   

  	
  07/26/2000

  	
   

  	
  07/26/2005

  	
   

  	
  $

  	
  423.00

  	
   

  
	
  MCORP

  	
   

  	
  Computer maintenance

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  1,312.00

  	
   

  
	
  Mainco Elevators

  	
   

  	
  Elevator maintenance

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  4,330.00

  	
   

  
	
  Ecolab

  	
   

  	
  Cleaning supplies

  	
   

  	
  05/30/2000

  	
   

  	
  05/30/2005

  	
   

  	
  $

  	
  299.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equipment Leases

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Copelco Capital, Inc.

  	
   

  	
  3 Canon fax machines

  	
   

  	
  06/30/1998

  	
   

  	
  06/30/2001

  	
   

  	
  $

  	
  175.88

  	
   

  
	
  Coffee Distributing Corp

  	
   

  	
  Coffee machines

  	
   

  	
  04/20/2000

  	
   

  	
  04/20/2002

  	
   

  	
  $

  	
  43.80

  	
   

  
	
  Pitney Bowes

  	
   

  	
  Postage meter

  	
   

  	
  03/20/1999

  	
   

  	
  07/20/2003

  	
   

  	
  $

  	
  594.00

  	
   

  
	
  MCS Canon

  	
   

  	
  4 fax machines

  	
   

  	
  07/21/2000

  	
   

  	
  07/21/2003

  	
   

  	
  $

  	
  155.00

  	
   

  
	
  Pitney Bowes

  	
   

  	
  Check signer

  	
   

  	
  06/20/1999

  	
   

  	
  10/20/2003

  	
   

  	
  $

  	
  316.00

  	
   

  
	
  MCS Canon

  	
   

  	
  Photocopiers (4)

  	
   

  	
  03/31/2000

  	
   

  	
  03/31/2004

  	
   

  	
  $

  	
  1,870.14

  	
   

  
	
  Telecheck

  	
   

  	
  Eclipse terminals

  	
   

  	
  08/14/2000

  	
   

  	
  08/14/2004

  	
   

  	
  $

  	
  61.90

  	
   

  



 





















 


EXHIBIT D


 


Master
Leases and Condominium Documents


 


Master Leases


 


1.                                         Lease dated February 11,
1999 of the 10th Floor of the Building from Irving Schatz to Ian
Schrager Hotels LLC, as assigned to the Landlord.


 


2.                                         Lease dated January
     , 1999 of a portion of the ground floor of the Building from Adrienne Schatz and Cheryl Hirsch to the
Landlord, as amended as of September 30, 1999.


 


Condominium Documents


 


1.                                         Amended and Restated
Declaration, dated as of February 12, 1999, Establishing a Plan of
Condominium Ownership of Premises Located at 353-361 West 57th
Street (a/k/a 356 West 58th Street) in the Borough of Manhattan,
City, County and State of New York, pursuant to Article 9-B of the Real
Property Law of the State of New York, by and among Landlord, Irving Schatz, Adrienne
Wechsler and Cheryl Hirsch, with attached By-Laws.


 


2.                                         Amendment dated as of
September 30, 1999 to Amended and Restated Declaration, by and among
Borrower, Irving Schatz, Adrienne Wechsler and Cheryl Hirsch.


 





















 


EXHIBIT E


 


Certain
Improvements to the Premises

(Landlord’s Work)


 


Completion
of the rehabilitation of the Premises in accordance with the plans and
specifications dated July 2, 1999, as amended from time to time, prepared
by Polshek and Partners, LLP, and the detailed specifications dated July 2,
1999, as amended from time to time attached to the Construction Contract dated January 1,
1999 by and between the Landlord and Lehrer McGovern Boris, Inc.


 





















 


EXHIBIT F


 


CERTIFICATE REGARDING TENTH FLOOR LEASE


 


The undersigned, Henry
Hudson Holdings LLC hereby certifies to Corus Bank, N.A. and Starwood Financial
Trust, that attached hereto is a true, correct and complete copy of that
certain Lease, dated February 11, 1999 (the “Tenth Floor Lease”),
between Irving Schatz and Ian Schrager Hotels LLC (f/k/a West 57th LLC),
a New York limited liability company, and all assignments and amendments
related thereto. The Tenth Floor Lease has not been amended, modified or assigned
by the undersigned other than as attached hereto.


 


Executed this 30 day of
September, 1999.


 


	
   

  	
  Henry Hudson Holdings LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Peter W. Ani

  	
   

  
	
   

  	
  Name:

  	
  Peter W. Ani

  
	
   

  	
  Title:

  	
  Authorized Signatory

  
					



 





















 


THIS
LEASE made as of the 11th
day of February, 1999 between
Irving Schatz having an office at 353 West 57th Street, New York, New York
10019 (“Lessor”) and Ian Schrager Hotels LLC (f/k/a West 57th LLC), a New York
limited liability company having its principal office at 475 Tenth Avenue, New
York, New York 10018 (“Lessee”).


 


WITNESSETH:


 


Lessor is the owner of the
Condominium Unit known as the Tenth Floor Unit (the “Tenth Floor Unit”) and the
Common Elements appurtenant thereto in the premises known as 353 West 57th
Street Condominium and by the street number 353-61 West 57th Street a/k/a 356
West 58th Street, Borough of Manhattan, City, County and State of New York,
said Unit being designated and described as the Tenth Floor Unit and Unit 6 in
the Declaration establishing a plan for condominium ownership of said premises
under Article 9-B of the Real Property Law of the State of New York dated April 11,
1985, under the name 353 West 57th Street Condominium (the “Condominium”), and
recorded in the New York County Office of the Register of the City of New York
on April 24, 1985, in Reel 902, Page 1, as amended by the First
Amendment to Declaration dated January 29, 1993 and also designated as Tax
Lot 1706 in Block 1048 of Section 4, Volume 2 of the Borough of Manhattan
on the Tax Map of the Real Property Assessment Department of The City of New
York and on the Floor Plans of said building (the “Building”), certified by
Butler Rogers Baskett, Architects, on March 27, 1985, and also filed with
the Real Property Assessment Department of The City of New York on April 24,
1985 as Condominium Plan No. 208, Map No. 4326, as modified by Floor
Plans of the Building certified by Butler Rogers Baskett, Architects, on December 14,
1992 as Condominium Plan 208A, Map No. 5192. The premises within which the
Tenth Floor Unit is located are more particularly described in Exhibit “A”
attached hereto and made a part hereof. All capitalized terms herein that are
not separately defined herein shall have the meanings given to those terms in
the Declaration or in the By-Laws and Rules and Regulations of 353 West
57th Street Condominium (hereafter the Declaration, By-Laws and Rules and
Regulations shall be collectively referred to as the “Condominium Declaration”);


 


Lessee
is the assuming assignee of the interest of the Lessee in that certain Net
Lease dated August 18, 1988 (the “EBC Lease”) by and between Lessor, as
landlord, and Educational Broadcasting Corporation, as tenant, for certain
premises on the tenth floor of the Building, as more particularly described in Paragraph
25.01A hereof;


 


Lessor
and Lessee wish to modify the EBC Lease, and as modified to restate the EBC
Lease in its entirety;


 





















 


From and after the effective date hereof, the
EBC Lease shall be of no further force or effect, being superseded in its
entirety by this Lease, which alone shall govern and control the relationship
of Lessor and Lessee as landlord and tenant respectively of the premises herein
demised and of each and every part thereof.


 


The Lessor hereby leases to the Lessee and the
Lessee hires from the Lessor the entire Tenth Floor Unit, together with the
improvements thereon, and the personal property owned or leased by the Lessor
and located within the premises described hereunder as of the commencement date
(as hereinafter defined) of this Lease and the appurtenances thereto, including
that portion of the Common Elements and the Limited Common Elements appurtenant
to the Tenth Floor Unit which are appurtenant to the premises leased hereunder
(hereafter such premises, improvements and appurtenant common elements leased
hereunder are referred to as the “Demised Premises”).


 


To have and to hold for a term commencing on December 1,
1997 (the “commencement date”), and ending on November 30, 2096 (unless
sooner terminated) at the net rental set forth in Article 1, subordinate
and subject in all respects to the provisions of the Condominium Declaration.


 


ARTICLE 1


 


RENT
PAYMENTS; ADDITIONAL RENT;


ASSUMPTION
OF OBLIGATIONS UNDER


CONDOMINIUM
DECLARATION


 


1.01                             A.                                 
The
fixed annual rental payable under this Lease shall be $450,000.00 per annum
payable in equal monthly installments of $37,500.00 in advance on the first day
of each month during the term, as the
same may be increased in accordance with Paragraph 1.01B hereof. The
term “net rent” as used in this Lease shall mean the fixed annual rental set
forth in this Paragraph as the same may be increased in accordance with Paragraph
1.01B hereof.


 


B.i.                                 The net rent payable pursuant to Paragraph
1.01A, of this Lease shall be adjusted prospectively (and not retroactively)
in accordance with the formula set forth in this Paragraph 1.01B on January 1,
2003 and on the 1st day of January each fifth (5th) year thereafter (i.e.,
2008, 2013 and so forth) for so long as this Lease continues in effect (each
such date is referred to as a “change date”). In applying the formula, the
following definitions shall prevail:


 


2





















 


a.                                         “Bureau” means the
United States Department of Labor, Bureau of Labor Statistics or any successor
agency that shall issue the indices or data referred to in subdivision i (b) of
this Paragraph l.01B.


 


b.                                        “Price Index” means
the U.S. Consumer Price Index for all Urban Consumers, New York-Northeastern
New Jersey, issued from time to time by the Bureau, or any other measure
hereafter employed by the Bureau in lieu of that price index that measures the cost
of living in the New York-Northeastern New Jersey area, or if an index for such
area is not available, then any other measure employed by the Bureau that measures
the cost of living nationally.


 


c.                                         “Monthly Price Index”
means the Price Index issued by the Bureau for each respective month in which a
change date occurs. Each change date will thus have its own Monthly Price
Index.


 


d.                                        “Base Index” means
the Price Index issued by the Bureau for the month of December 1997.


 


e.                                         The “issue” of a
Price Index means the release to the public of a Price Index for the relevant
month, and the date of issue shall be the date it is so released, whether or
not the release occurs within such relevant month. Retroactive adjustments shall
be made to any payments made with respect to a month before the issue of a
Price Index for that month.


 


ii.                                         If the Monthly Price
Index in respect to any change date (the “New Price Index”) is greater than the
Monthly Price Index in respect to the immediately preceding change date (or the
Base Index with respect to the January 1, 2003 change date) (the “Prior
Price Index”), then the net rent payable by Lessee, shall be increased
commencing on such change date to an amount calculated by multiplying the net
rent in effect for the period immediately prior to such change date by a
fraction, the numerator of which is the New Price Index and the denominator of
which is the Prior Price Index, provided that notwithstanding the foregoing, if
such formula would result in the net rent being increased by an amount greater
than fifteen (15%) percent then the net rent for such period shall only be
increased by fifteen (15%) percent.


 


iii.                                      Notwithstanding anything
herein to the contrary, in no event may the net rent payable under this Lease
be decreased if, on any change date, the New Price Index is less than the Prior
Price Index.


 


1.02          The Lessee will pay to the Lessor the net rent due
under this Lease, and all other sums that may become due or be


 


3





















 


payable by the Lessee under this Lease, at the time
and in the manner provided in this Lease. All of such other sums so to be paid
may, at the Lessor’s option, be deemed to be additional rent to be added to any
net rent then due or thereafter falling due, and in the event of non-payment,
the Lessor shall have all the rights and remedies provided by law or by this
Lease in the case of the non-payment of rent or of a breach of condition.


 


1.03                             Lessee expressly acknowledges and agrees that
this is an absolute “net” lease, whereby under all circumstances and conditions
the net rent shall be absolutely net to the Lessor over and above all costs,
expenses and charges of every kind or nature whatsoever related to the Demised
Premises.  Without limiting the
generality of the foregoing, the Lessee shall pay all real estate taxes,
condominium common charges and insurance premiums due with respect to the
Demised Premises, and shall comply with all legal and insurance requirements
and all instruments of record affecting the Demised Premises, subject to a
right on the part of the Lessee to contest their application and, in the case
of real estate taxes, to institute and control tax certiorari proceedings.  This Lease shall not terminate nor shall
Lessee have any right to terminate this Lease, nor shall Lessee be entitled to
any abatement, deduction, deferment, suspension or reduction of, or set-off,
defense or counterclaim against, any rentals, charges, or other sums payable by
Lessee under this Lease; nor shall the respective obligations of Lessor and
Lessee be otherwise affected by reason of any inconvenience or interruption,
cessation, or loss of business caused directly or indirectly by any present or
future laws or by compliance therewith, or by rationing or curtailment of labor
or materials, or by war, civil commotion, strikes or riots, or other cause or
causes beyond the control of Lessor or Lessee, or by legally required changes
in the construction or operation of the Demised Premises, or by damage to or
destruction of the Demised Premises from whatever cause, or any taking by
condemnation or eminent domain (except as may otherwise be expressly provided
herein), or by the lawful prohibition of Lessee’s use of the Demised Premises,
or by reason of any default or breach of any warranty by Lessor under this
Lease, any Laws to the contrary notwithstanding; it being the intention that
the obligations of Lessor and Lessee hereunder shall be separate and
independent covenants and agreements and that the net rent, additional rent and
all other charges and sums payable by Lessee hereunder shall continue to be
payable in all events unless the obligations to pay the same shall be terminated
pursuant to the express provisions of this Lease.  The Lessor shall receive the annual net rent
free from all taxes, charges, expenses, damages, and deductions of every
description, including, without limitation, Impositions (as defined in Section 12.01
of this Lease) and Common Charges described in the Condominium Declaration
chargeable to the Tenth Floor Unit and the Common Elements and Limited Common
Elements appurtenant thereto, and any other sums or charges payable by the
Lessor under the


 


4





















 


Condominium Declaration in connection with the use and
occupation of the Tenth Floor Unit and the Common Elements and Limited Common
Elements appurtenant thereto, and Lessee hereby assumes the obligation to pay,
and shall pay all of the foregoing which, except for this Lease, would have
been chargeable against the Tenth Floor Unit and the Common Elements and
Limited Common Elements appurtenant thereto and payable by the Lessor. The
foregoing amounts shall be deemed to be additional rent payable hereunder and
shall, unless otherwise indicated, be included in the term rent or net rent as
used hereafter in this Lease. Nothing contained in this Lease, however, (a) shall
obligate Lessee to pay any interest or principal on any mortgage by the Lessor
of its fee interest in the Tenth Floor Unit, or any charge arising solely out
of a paramount or master lease of the Demised Premises or any portion thereof
entered into by Lessor as landlord after the date hereof, or any other
agreement entered into by Lessor to which Lessee is not a party, or any estate,
inheritance, succession tax or levy or any income, excess profits or revenue
tax or levy based on or measured by the net income or gross income of the
Lessor excluded from the term “Impositions” by Paragraph 12.01B; or (b) shall
be construed to relieve Lessor from any costs incurred by Lessor (i) in
connection with Lessor’s indemnification obligations under this Lease and (ii) with
respect to any breach of Lessor’s obligations under this Lease.


 


1.04                             THIS LEASE IS SUBJECT TO ALL OF THE PROVISIONS
OF THE CONDOMINIUM DECLARATION.  The Lessee
hereby assumes and agrees to perform all of the obligations of the Lessor
arising during the term of this Lease under the Condominium Declaration
applicable to the use and occupation of the Demised Premises including, without
limitation, the payment of all Common Charges and any other sums payable under
or pursuant to the Condominium Declaration with respect to the ownership, use
and occupation of the Tenth Floor Unit and the Common Elements and Limited
Common Elements appurtenant thereto.


 


1.05                             To the extent not described above, the Lessee
shall be responsible for and pay when due all other charges arising out of
Lessee’s use, occupancy and possession of the Demised Premises, including, but
not limited to, telephone service, sanitary sewer, water, gas and electricity
charges.  In no event shall Lessor be liable
for any interruption or failure of any utility or other service provided to the
Demised Premises.


 


1.06                             The Lessor shall promptly remit when due to the
Condominium the Common Charges chargeable to the Demised Premises after their
receipt from the Lessee, and shall remit when due to the party to whom owed all
other amounts paid to it by the Lessee on account of any items described in Section 1.03.


 


5





















 


ARTICLE 2


 


REPAIRS
AND CONDITION


OF THE
DEMISED PREMISES


 


2.01                             The Demised Premises and all areas adjacent
thereto (including the Common Elements and Limited Common Elements appurtenant
thereto) which are not the responsibility of the Condominium
Board of Managers, shall be kept in good order and repair by the Lessee at the
Lessee’s sole cost and expense, and the Lessee shall be solely responsible for
and shall make all repairs and replacements, ordinary as well as extraordinary,
foreseen and unforeseen, structural or otherwise, that may be necessary or required
in or about the same so that at all times the Demised Premises shall be in
thorough good order, condition, and repair. Lessor shall have absolutely no
obligation to make any repair or replacement of any kind or nature in or to the
Demised Premises nor to any improvements or personal property included in this
Lease.


 


2.02                             Lessee acknowledges that it has examined the
Demised Premises and accepts same in their present condition “AS IS.” Lessee
acknowledges that neither Lessor nor its agents have made any agreements,
representations, warranties or promises with respect to the Demised Premises,
the Building or the sidewalk adjacent thereto or with respect to present or
future rents, expenses, operations, tenancies or any other matter, except as herein
expressly set forth in this Lease; and that Lessee relied on no statement of
Lessor nor the statement nor “set-up” of any broker for that purpose (but the
foregoing acknowledgment shall be for the benefit of Lessor and Lessor’s
successors and assigns and not for any broker). 
Lessor shall not be required to repair, renovate, restore or redecorate the
Demised Premises at any time during the term of this Lease.


 


ARTICLE 3


 


USE; COMPLIANCE WITH LAWS


AND CONDOMINIUM DECLARATION


 


3.01                             Lessee may use the Demised Premises for any
lawful purpose permitted under the Declaration and for no other purpose. The
Lessor makes no representation or warranty concerning the nature or legality of
any use of the Demised Premises.


 


3.02                             The Lessee shall have the right at its sole
cost and expense to make application to the Department of Buildings of the City
of New York to change the legal use of the Demised Premises or


 


6





















 


any portion thereof, to rezone the Demised Premises or
amend the certificate of occupancy thereof or file or request permits for
construction thereon and to make any application to any governmental agency for
any such change. Lessor agrees to execute such documents and instruments
necessary to effect such change, provided that any reasonable cost or expense
in connection therewith is paid by the Lessee, and to cooperate with the Lessee
in such manner as may be reasonably requested by Lessee in connection with such
change.


 


3.03                             A.                                 
Throughout
the term of this Lease the Lessee shall, at its own cost and expense, promptly
observe and comply with all laws, orders, regulations, rules, ordinances, and
requirements of the Federal, State, County and local Governments, and of all of
their administrative departments, bureaus and officials, and of the local fire
insurance rating organization, and of all insurance companies writing
policies which the Lessee is required to obtain or which the Condominium
obtains, covering the Demised Premises or any part thereof and the Condominium
and the Units comprising the Condominium (“Condominium Units”), and the
reasonable requirements of any insurance companies writing policies other than
those which the Lessee is required to obtain or the Condominium obtains
covering the Demised Premises or any part thereof and the Condominium and the
Condominium Units, including, without limitation, laws, orders, regulations,
rules, ordinances, or requirements which relate to structural repairs, changes,
or alterations to or in and about the Demised Premises or to repairs, changes,
or alterations incident to or as the result of any use or occupation of the
Demised Premises, or use of the Common Elements or Limited Common Elements of
the Condominium including, without limitation, the adjacent sidewalks, and
whether the same are now in force, or may, at any time in the future, be
enacted or directed, and the Lessee shall pay as additional rent all costs,
expenses, claims, fines, penalties and damages that may in any manner arise out
of or be imposed because of the failure of the Lessee to comply with these
covenants.


 


B.                                       Lessee shall, at
Lessee’s sole cost and expense, correct any condition which constitutes a
violation of any law, order, regulation, rule, ordinance or requirement of the governmental
units described in this paragraph, including, without limitation, any such
conditions which exist on the date of this Lease and any such conditions for
which notice of violation has been issued by any such governmental unit prior
to the date of this Lease.


 


C.                                       The Lessee shall have
no obligation to correct any condition which constitutes a violation of any
law, order, regulation, rule, ordinance or requirement of the governmental
units described in this Section 3.03 unless and until it has actual
notice thereof or has received notification from such


 


7





















 


governmental unit that such violation exists or Lessor
has received such notification and given notice to Lessee of its receipt.


 


D.                                      The Lessor shall have
no obligation to correct any condition with respect to the Demised Premises
described in any notice of violation of any governmental law, order,
regulation, rule or requirement whether the same has been actually issued
by a governmental unit prior to the date of this Lease or at any time
thereafter.


 


3.04                             A.                                 
The
Lessee shall use the Demised Premises only in accordance with the provisions of
the Condominium Declaration.  Throughout
the term of this Lease, the Lessee shall, at its own cost and expense, promptly
observe and comply with all of the provisions of the Condominium Declaration
and any rules, regulations, and requirements thereunder or promulgated or
adopted by the Board of Managers of the Condominium, and the Lessee hereby assumes
all of the obligations of the Lessor to use and occupy the Demised Premises in
accordance therewith.


 


B.                                       Lessee agrees that
the value of the Demised Premises and the reputation of the Lessor will be
seriously injured if the Demised Premises are used for any obscene or
pornographic purposes or any sort of commercial sex establishment. Lessee
agrees that Lessee will not bring or permit any obscene or pornographic
material on the Demised Premises, and shall not permit or conduct any obscene,
nude, or semi-nude live performances on the Demised Premises, nor permit use of
the Demised Premises for nude modeling, rap sessions, or as a so-called rubber
goods shop, or as a sex club of any sort, or as a “massage parlor.” Lessee
agrees further that Lessee will not permit any of these uses by any sublessee
or assignee of the Lessee. This Paragraph 3.04B shall directly bind any
successors in interest to the Lessee. Lessee agrees that if at any time Lessee
violates any of the provisions of this Paragraph 3.04B, such violation shall be deemed a
breach of a substantial obligation of the terms of this Lease and objectionable
conduct. Pornographic material is defined for purposes of this Article as
any written or pictorial matter with prurient appeal or any objects or
instruments that are primarily concerned with lewd or prurient sexual activity.
Obscene material is defined here as it is in Penal Law §235.00.


 


3.05                             The Lessee, after notice to the Lessor, may, by
appropriate proceedings conducted promptly at its own expense, in its name or
(whenever necessary) the Lessor’s name, contest in good faith the validity or
enforcement of any such law, order, regulation, rule, ordinance, or requirement
referred to in Section 3.03, and may defer compliance therewith,
provided that (a) such non-compliance shall not constitute a crime on the part
of the Lessor, (b) the Lessee shall diligently prosecute such contest to final
determination by the court, department or governmental


 


8





















 


authority or body having final jurisdiction, and (c) the
Lessee shall furnish the Lessor with such security, by bond or otherwise, as
the Lessor may reasonably request in connection with the contest. The Lessor
agrees to cooperate reasonably with the Lessee and to execute any documents or
pleadings reasonably required for the purpose of any such contest, provided
that the Lessee shall discharge any expense or liability of the Lessor, and
indemnify the Lessor against any claim arising in connection therewith
including, without limitation, attorneys’ fees and expenses.


 


3.06                             The Lessor shall have the right to have
reasonable access to the Demised Premises to the extent necessary for making emergency
repairs necessary to prevent damage to the Demised Premises, or any other
portion of the Building, for maintenance, repair or improvements to any pipes,
wires, conduits, sprinklers and public utility lines in or accessible through
the Demised Premises.  Such right of
access shall be exercised in such a manner as shall not unreasonably interfere
with the use of the Demised Premises for its permitted purpose.  Such entry shall be made during reasonable
hours and shall be permitted on not less than five (5) days’ notice,
except that no notice will be necessary in the case of an “emergency” (a
condition requiring repairs or replacements immediately necessary for the
preservation or safety of the Building, or in order to avoid substantial damage
to the Building, or for the safety of occupants of the Building, or other persons,
or required to avoid the suspension of any necessary service in the Building).


 


3.07                             The Lessor agrees that it will not exercise its
rights as an owner of the Penthouse Unit or as a member of the Condominium
Board of Managers, as both such terms are defined in the Condominium
Declaration, in a manner which would impair, interfere with or be inconsistent
with the exercise by the Lessee of any right granted to the Lessee under this
Lease, including without limitation the Lessee’s rights under Article 20
of this Lease to the quiet enjoyment of the Demised Premises.  The Lessor will not without the Lessee’s
consent, which shall not be unreasonably withheld or delayed, amend the
Condominium Declaration in any respect, which affects the Demised Premises.


 


3.08                             Lessee shall be entitled to all rights to the
use and enjoyment of the Demised Premises and the Building afforded to Lessor under
the Condominium Declaration and not inconsistent with any provision of this
Lease.  In furtherance thereof, upon the request
of Lessee, Lessor shall give its consent and request the consent by any other
Unit Owner (as defined in the Condominium Declaration), for any matter which
requires such consent in order to obtain any such right for the benefit of
Lessee; and, at Lessee’s sole cost and expense, shall take all actions,
reasonably requested by Lessee, to enforce, for the benefit of Lessee, the rights
of Lessor under the Condominium Declaration; including,


 


9





















 


without limitation, the commencement of an action in
Lessor’s name, to enforce such rights, at the sole cost and expense of Lessee
and subject to Lessee’s direction and control, or the assignment to Lessee of
Lessor’s rights to prosecute such action, in either case by counsel selected by
Lessee. Lessee shall indemnify Lessor from and against any liabilities and hold
the Lessor harmless from any loss, damage, cost or expense (including
reasonable attorneys’ fees) which may arise as a result of the
exercise of Lessee’s rights hereunder. Lessor shall not grant its consent to
any matter which affects the Demised Premises which may be requested by any other
Unit Owner, or waive any rights or breach any provision under the Condominium
Declaration which affects the Demised Premises, without Lessee’s prior written
consent (not to be unreasonably withheld or delayed). Lessor shall send to
Lessee promptly copies of all notices, requests and other communications
received from other Unit Owners in connection with the Condominium or under the
Condominium Declaration; and shall permit Lessee to participate in
consultations referred to in the Condominium Declaration with other Unit Owners
which occur with respect to the Condominium.


 


ARTICLE 4


 


SURRENDER
AT END OF TERM


 


4.01                             The Lessee will surrender and deliver up the
Demised Premises and the buildings and improvements thereon and the Common
Elements and Limited Common Elements appurtenant thereto including, but not
limited to, all, elevators, hoists, pipes, plumbing, engines, electric wires,
and fixtures used in connection with the operation of the Demised Premises (but
not movable trade fixtures or other items of personal property which were not
included among the items of property at the Demised Premises on the date of
this Lease and moveable equipment of occupants in possession of the Demised
Premises) at the expiration of the term of this Lease or sooner termination or
expiration of the term in good repair and condition, reasonable wear and tear
thereof excepted, and subject to the other provisions of this Lease regarding
responsibility for casualty losses and condemnation to which end the Lessee
specifically contracts under penalty of forfeiture and damage, except that any
articles discarded due to obsolescence need not be replaced.


 


10





















 


ARTICLE 5


 


MECHANICS’
LIENS


 


5.01                             Lessee shall have no power to subject the Demised
Premises, or Lessor’s interest in the Demised Premises, or the Condominium or
the Tenth Floor Unit or the interest of any owner therein or in any other
Condominium Unit to any mechanics’ or other liens.  If any mechanics’ or other liens or order for
the payment of money shall be filed against the Demised Premises or the
Condominium or any other Unit of the Condominium or the interest of any owner
therein by reason of or arising out of any labor or material furnished or
alleged to have been furnished or to be furnished to or for the Lessee at the
Demised Premises, or for or by reason of any change, alteration, or addition or
the cost or expense thereof or any contract relating thereto, or by reason of
any other act or omission of Lessee, the Lessee shall cause the same to be
canceled and discharged of record, by bond or otherwise as allowed by law, at
the expense of the Lessee.  Lessee shall nonetheless have an unlimited
right to contest such lien and if Lessee does so, Lessee need not cause such
cancellation or discharge during the pendency of such challenge unless (i) there
is an imminent threat to Lessor’s title to the Demised Premises; or (ii) the
existence of the lien constitutes a default under any mortgage affecting the
fee interest in the Demised Premises. Lessee shall also defend on behalf of the
Lessor, the Condominium and the owners of the Condominium Units, at the Lessee’s
sole cost and expense, any action, suit, or proceeding that may be brought
thereon or for the enforcement of those liens or orders, and the Lessee will
pay any damages and satisfy and discharge any judgment entered therein and save
harmless the Lessor, the Condominium and the Condominium Unit owners from any
claim or damage resulting therefrom. 
Failure to comply with this Article 5 shall entitle Lessor
to avail itself of the remedies in Article 17 upon giving the
notices required under Article 17, provided, however, that if the
Lessee has failed to cause the lien or order to be canceled and discharged of
record within fifteen (15) days after Lessor’s written demand therefor, and if (i) there
is an imminent threat to Lessor’s title to the Demised Premises; or (ii) the
existence of the lien constitutes a default under any mortgage affecting the
fee interest in the Demised Premises, then the Lessor shall have the right to
cause the same to be cancelled and discharged of record by bond or other
security allowed by law (other than actual payment to the lienor) and the
entire expense therefor shall constitute additional rent payable to the Lessor.


 


11





















 


ARTICLE 6


 


INSPECTION
BY LESSOR


 


6.01                             Lessee shall permit the Lessor and Lessor’s
agents to enter the Demised Premises at reasonable hours (subject to the rights
of sub-tenants and occupants) and to examine them, upon not less than five (5) days’
advance notice; provided, however, that no advance notice shall be required if
such inspection is required because of any damage to the Demised Premises or
property damage to the balance of the building in which the Demised Premises
are located or to the other Condominium Units which is caused by or results
from any condition at the Demised Premises, or if such inspection must be
conducted immediately because of some condition at the Demised Premises which
interferes with or poses a danger to the occupants of the Demised Premises or
the other Condominium Units.


 


ARTICLE 7


 


BANKRUPTCY
OR INSOLVENCY


 


INTENTIONALLY
OMITTED.


 


ARTICLE 8


 


INDEMNIFICATIONS


 


8.01                             The Lessee shall keep, save, and hold harmless
the Lessor from any and all loss, damage, cost or expense (which may include,
without limitation, reasonable attorneys’ fees) for anything and everything
whatsoever arising from or out of the use, occupation and possession of the
Demised Premises by or under the Lessee, the Lessee’s agents, servants,
invitees or subtenants and from any loss, damage, claim, cost or expense (which
may include, without limitation, reasonable attorneys’ fees) arising from any
fault or negligence by the Lessee or any of Lessee’s agents, servants or
subtenants, or any claim thereof, or any failure on the part of the Lessee or
its agents, servants, invitees, or subtenants to comply with any of the
covenants, terms, and conditions contained in this Lease or the Condominium
Declaration, or arising out or any violation affecting the Demised Premises.


 


12





















 


8.02                          
The
Lessor shall keep, save, and hold harmless the Lessee from any loss, damage,
claim, cost or expense (which may include, without limitation, reasonable
attorneys’ fees) arising from any fault or negligence by the Lessor or any of
Lessor’s agents or servants in or about the Demised Premises.


 


8.03                          
The
provisions of this Article 8 shall survive the Lessee’s acquisition
of title to the Demised Premises pursuant to the Option set forth in Article 31
for a period of one year after the Closing Date under the Contract of Sale.


 


ARTICLE 9


 


ALTERATIONS


 


9.01.                          Lessee shall not make any structural changes to
the Demised Premises, without in each instance having first given to the Lessor
10 days’ prior written notice accompanied by plans and specifications for the
work to be performed.  A “structural
change” shall be any alteration to the mechanical, electrical or heating and
ventilation, elevator or other systems serving the Demised Premises (as such
systems are defined in this Lease as the “systems”) or any change which affects
the structural soundness of the Building. 
Prior notice to Lessor shall not be required for a change or alteration
which does not involve any structural change, or which involves minor
alteration to the mechanical, electrical or heating and ventilation systems
serving the Demised Premises.


 


9.02.                          Any change, alteration, demolition or new construction
(in this Article 9 referred to as the “work” or collectively as “changes
and alterations”) shall be made in all cases only if Lessee observes the
conditions described in this Article 9.


 


A.                                     No change or
alteration shall be undertaken until Lessee shall have obtained all approvals
required by and complied with all applicable provisions of the Condominium Declaration,
and thereafter, the work shall be performed in accordance with all applicable
requirements of the Condominium Declaration.


 


B.                                       Any structural change
shall be conducted under the supervision of a registered architect or
professional engineer licensed in the State of New York, selected by Lessee.


 


C.                                       All changes and
alterations shall be of such a kind that, when completed, the value and utility
of the improvements constituting the Demised Premises shall be not less than
the value and utility of the improvements immediately before


 


13





















 


the change or alteration; provided that change in use
or a reconfiguration of the rooms in the Demised Premises which is done in
compliance with Article 3 and the other provisions of this Article 9
shall be deemed not to be a breach of this subparagraph.


 


D.                                      All work done in
connection with any change or alteration shall be done in a good and
workmanlike manner and in compliance with the applicable building and zoning
laws and with all laws, ordinances, orders, and requirements of all sovereign authorities
and the appropriate departments, commissions, boards, and officers
thereof.  Lessee shall not perform any
work requiring authority unless and until a permit has been issued and a copy thereof
provided to Lessor.  The work of any
change or alteration shall be prosecuted with reasonable dispatch, unavoidable
delays excepted.  Lessee shall procure or
cause to be procured worker’s compensation insurance covering all persons
employed in connection with the work before any work is begun.  Lessee shall maintain, at its sole expense
and at all times when any work is in progress, general liability and property
damage insurance and completed operations coverage for the mutual benefit of
Lessee and Lessor with limits of not less than those required to be carried
pursuant to Article 11 of this Lease.


 


E.                                        In case of any work
made necessary by or done in connection with a partial
condemnation of the Demised Premises in eminent domain, Lessee may deposit with
a bank or trust company or any Institutional Mortgagee including a Leasehold
Mortgagee designated by Lessee any condemnation proceeds, to be disbursed as the
work of restoration of the Demised Premises progresses or upon completion
thereof.  In case of any work made
necessary by or done in connection with an insured casualty loss, insurance
proceeds shall be adjusted and disbursed as provided in Article 11
of this Lease.


 


9.03         Upon completion of any structural alteration, Lessee
shall obtain all necessary approvals and sign-offs from the Buildings
Department and other appropriate governmental authorities, if any, and shall
thereafter obtain a change in the Certificate of Occupancy if required by
reason of the changes and alterations.


 


ARTICLE 10


 


SECURITY
DEPOSIT


 


10.01.      This Article shall apply only if this Lease is
assigned, or if all or substantially all of the Demised Premises are sublet, to
an entity which is not (i) an Affiliate (as defined in Section 29.06
of this Lease) of Ian Schrager Hotels LLC or, in


 


14


















 


the case of a sublet only, (ii) Educational
Broadcasting Corporation (Lessee’s predecessor as lessee of the Demised
Premises). From and after any such assignment or sublet, Sections 10.02
through and including 10.07 of this Article shall be and remain applicable
during the remainder of the term of this Lease.


 


10.02.               A.                                Lessee shall deliver
to Lessor and at all times during the term of this Lease maintain with Lessor
the sum of $250,000.00 as security for Lessee’s full and faithful performance
of the terms of this Lease (the “security deposit”). Lessor shall deposit the
same in a segregated, interest bearing account to be established with a lending
institution doing business in the city of New York, N.Y.


 


B.                                  If an event occurs
under Article 17 of this Lease which constitutes, or would, after
the giving of notice or the passage of time or both, constitute a default by
the Lessee under Article 17 of this Lease, including by way of
illustration only and not by limitation, the non-payment of net rent,
additional rent, or any other charges payable by Lessee under this Lease
without regard to the giving of notice of such failure or the expiration of any
grace period (a “drawing event”), then the Lessor may withdraw from the
Security Deposit such amount as the Lessor determines in its discretion to be
necessary to satisfy Lessor’s costs, expenses, losses and damages arising from
and to correct Lessee’s default, and the Lessor may use, apply, and retain the
whole or any part of that amount to the extent needed to satisfy Lessor’s
costs, expenses, losses and damages and to correct the Lessee’s default.  Such amounts may include amounts necessary
for the reimbursement of Lessor for any reasonable sum it expended or that it
may be required to expend because of Lessee’s default, as well as to the extent
needed to make Lessor whole for any damages or deficiency incurred by Lessor in
the reletting of the Demised Premises, whether the damage or deficiency
occurred before or after summary proceedings to recover possession or other
re-entry by Lessor.


 


C.                                  Unless applied in the
manner above stated, the security deposit shall be returned by the Lessor to
the Lessee upon the expiration of thirty (30) days after the termination date
of this Lease when the termination comes about other than by reason of Lessee’s
default, or if Lessee elects to apply the security deposit to the Purchase
Price, upon the acquisition by Lessee of title to the Demised Premises pursuant
to the Contract of Sale (the term “Contract of Sale” as used in this Lease
means the Contract of Sale defined in Article 31 of this Lease).


 


D.                                 The Lessor shall give
prompt notice to the Lessee after any use by the Lessor of the Security Deposit
and the Lessee shall promptly (but not later than fifteen (15) days after


 


15





















 


receipt of the
notice) arrange for the deposit or crediting to the Security Deposit of such
amount as is necessary so that the principal amount of the
security deposit established under Section 10.02 or Section 10.07
is not less than $250,000.00.


 


E.                                   Any interest or other earnings accrued on the
Security Deposit less a one (1%) percent per annum administrative fee which
Lessor may withdraw and retain, shall be added to and constitute part of the
Security Deposit.


 


10.03                   The Lessee hereby grants to the Lessor a valid
and enforceable lien on and security interest in the Security Deposit as
security for the performance and the payment of all the Lessee’s obligations
due under this Lease and a security interest in any new securities or other
property which is received on account of the Security Deposit, and all
proceeds, whether cash or non-cash, of all of the foregoing.


 


10.04                   The Security Deposit constitutes and will constitute
security for the full and prompt payment as and when due of all amounts of
money and the performance of all obligations of the Lessee due under this
Lease.


 


10.05                   The Lessee shall, at its own cost and expense, promptly
and duly execute financing statements and any other security agreements reasonably
requested by Lessor pertaining to the Security Deposit and all such instruments
and documents of further assurances including, but not limited to, supplemental
security agreements, financing statements and continuation statements, and take
such other action, as Lessor may reasonably require in order that a valid lien
on and security interest in the Security Deposit in favor of Lessor will be
established, perfected and continued in effect at all times.  The Lessee hereby authorizes Lessor to effect
such recording and filing as aforesaid (including the filing of any financing
statements or continuation statements without the signature of the Lessee where
permissible), and Lessee shall bear the expense of any recording fees.


 


10.06                   To effectuate the terms and provisions hereof, the
Lessee hereby designates and appoints the Lessor and its assignees, designees
or agents as attorneys-in-fact of the Lessee irrevocably and with power of
substitution, with authority to do each and every of the following acts in the
event of a default as defined in Article 17: to do all acts and
things necessary and advisable in the sole discretion of the Lessor to carry
out and enforce the Lessor’s security interest including the sale, assignment, delivery
and disposition of any part or all of the security deposit.  All acts of said attorney or designee are
hereby ratified and approved to the extent consistent with the terms of this
Lease.  This power of attorney, being
coupled with an interest, is irrevocable while


 


16





















 


any of the Lessee’s
obligations under this Lease are due or not satisfied or fully performed.


 


10.07                   A.                                  The Lessee has
advised the Lessor that it may be desirable for the Lessee to substitute the
letter of credit described in this Section 10.07 (the “Letter of
Credit”) for the $250,000.00 cash security deposit required to be delivered by
the Lessee.


 


B.                                  Provided that no
drawing event as defined in Paragraph 10.02B has theretofore occurred,
Lessee shall have the right, by giving notice to the Lessor not less than
thirty (30) days prior to the date that Lessee proposes to substitute the
Letter of Credit for the $250,000.00 cash Security Deposit, to substitute for
the $250,000.00 cash Security Deposit, an irrevocable Letter of Credit drawn
upon a major New York City commercial bank approved by the Lessor, which
approval shall not be unreasonably withheld or delayed.  The Letter of Credit shall be extended or
renewed from year to year during the entire term of this Lease or until such
time as the Lessee redelivers to the Lessor $250,000.00 cash as the Security
Deposit.


 


C.                                  The Letter of Credit
shall be in the form annexed to this Lease as Exhibit 10.07.


 


D.                                 If a drawing event as defined
in Paragraph 10.02B occurs the Lessor may immediately draw under the
Letter of Credit the full amount thereof and apply the same for the purposes
described in Paragraph 10.02B of this Lease.  Any balance of the proceeds of the Letter of
Credit remaining shall be deposited in the manner provided for cash security
and invested in accordance with Section 10.02 of this Lease and
shall thereafter be subject to all other provisions of Article 10
of this Lease.


 


E.                                   The Lessor shall
promptly give the Lessee a copy of any draft and certificate presented to the
bank in connection with a drawing under the Letter of Credit.


 


F.                                   If thirty (30) days
prior to the expiration date of any Letter of Credit issued hereunder the
Lessor does not receive confirmation from the issuing bank of the extension or
renewal of the Letter of Credit, the Lessor may immediately draw upon the full
amount available under the Letter of Credit and the proceeds from such drawing
shall be deposited in the manner provided for cash security and invested in
accordance with Section 10.02 of the Lease and shall thereafter be
subject to all other provisions of this Article 10.


 


G.                                  In the event of the
sale of the Demised Premises by the Lessor, the Lessee shall cause any Letter
of Credit delivered hereunder to be reissued in the name of the transferee


 


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not later than
the date of the closing of such sale, provided the Lessee has received written
notice of such transfer not later than thirty (30) days prior to such date; and
provided Lessor surrenders the Letter of Credit in its possession at the
closing under the contract for such sale in exchange for the reissued Letter of
Credit.


 


ARTICLE 11


 


INSURANCE


 


11.01                   A.                                  Lessee shall at all times during the term of this
Lease, at its own expense insure and keep insured in responsible insurance
companies authorized to do business in the State of New York, the Demised
Premises, and all alterations, extensions, and improvements thereto and
replacements thereof, against loss or damage by fire and the risks contemplated
within the extended coverage endorsement (as such endorsement in the broadest
form may customarily be written in New York from time to time) and against such
other risks as shall reasonably be required by the Lessor, the Condominium Declaration
or the Condominium Board of Managers or by a Fee Mortgagee (as defined in Section 29.05)
or Leasehold Mortgagee who has given the Leasehold Mortgagee’s notice described
in Paragraph 15.01A and customarily insured for premises of similar use
and location, in amounts that may be reasonably required by the Lessor, or as
may be required by the Condominium Declaration, the Condominium Board of
Managers or by the holder of such Institutional Mortgage, but in no event in an
amount less than the full replacement cost, from time to time, of the building
and improvements included within the Demised Premises.  Lessee agrees to pay the premiums on such
insurance, as and when those premiums become due and payable, and promptly to
deliver to and deposit with the Lessor all such policies of insurance with due
proof of payment of premiums, and to deliver renewal policies, with such proof,
to Lessor within thirty (30) days prior to expiration of the policies.  At the beginning of the term of this Lease,
Lessor’s fire and other policies then in force shall be canceled unless
otherwise directed by Lessee and if not canceled the premiums thereof shall be
prorated and adjusted between Lessor and Lessee as of the commencement date,
and similar adjustment and proration shall be made in respect to any such
policies taken out by Lessee and in existence at the end of the Lease term
unless Lessor directs that they be canceled. 
All policies of fire and other insurance described in this Paragraph
11.01A shall be for the benefit of the Lessor, Lessee, the Condominium, and
any Institutional Mortgagee referred to above, as their interests may appear,
but the interest of any such mortgagee shall be covered by the customary
mortgagee endorsement employed in New York.  Such policies of insurance


 


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obtained by the Lessee may
be blanket policies covering other properties of the Lessee, provided that the
insurance coverage allocated to the Demised Premises complies with all the
provisions of this Lease.


 


B.                                  Lessee shall not be
obligated to obtain the insurance described above in Paragraph 11.01A to
the extent that such insurance is obtained by the Condominium Board of Managers
for all Condominium Unit Owners, in which case the Lessee shall pay the cost of
such insurance.


 


11.02                   A.                                  If any portion of the
Demised Premises shall be damaged or destroyed by any cause whatsoever during
the term of this Lease, the Lessee shall, with reasonable promptness, repair
and replace the same at its expense, so that the building and improvements
constituting the Demised Premises after that repair and replacement shall be in
better condition than they were in at the commencement of the term of this
Lease.  If the proceeds of insurance
obtained by the Lessee payable with respect to that rebuilding exceed the cost
of that rebuilding, the Lessee shall be entitled to retain the surplus if it
has performed the rebuilding, otherwise the surplus shall be equitably
allocated between Lessor and Lessee, and their respective mortgagees, based on their
respective interests in the Demised Premises. 
Notwithstanding the foregoing, the Lessee shall have no obligation to
make such repair or replacement if the damage or destruction is of a nature or if
the cost of repair is such that the Condominium Board of Managers or the
Condominium Unit Owners exercise any right under the Condominium Declaration
not to repair the Building in which the Demised Premises are located.  If such right not to repair is so exercised
by the Condominium Board of Managers or the Condominium Unit Owners, then this
Lease shall terminate as of the date the determination not to repair is made by
the Condominium Board of Managers or the Condominium Unit Owners as the case
may be, and the proceeds of the insurance shall be equitably allocated between Lessor
and Lessee, and their respective mortgagees, based on their respective
interests in the Demised Premises.


 


B.                                  If the Lessee is
required by the provisions of this Article 11 to repair or replace
destruction of or damage to the Demised Premises, then the Lessor shall not
compromise or adjust any loss under any insurance policy covering such damage
or destruction without the consent of the Lessee, which consent shall not be
unreasonably withheld or delayed.


 


11.03                   The Lessee shall not
be entitled to any abatement of rent, nor shall its obligations under this
Lease be terminated during the term of this Lease, notwithstanding any
destruction of or damage to the Demised Premises or the Building by any cause
whatsoever, except as otherwise provided in this Article 11.


 


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11.04                   In the event of
damage to or destruction of any part
of the Demised Premises during the term of this Lease which Lessee is required
to and undertakes to repair, Lessor agrees to pay to Lessee or to deposit with
the Depository (as defined in Section 11.07), in the manner
prescribed for proceeds of Lessee’s insurance in Section 11.07, any
amounts that the Lessor shall receive as proceeds of any insurance policy
covering the loss (including insurance obtained by the Condominium) paid for by
the Lessee.  The provisions of this Section 11.04
are subject to such modus operandi as may be reasonably required by (i) any
Fee Mortgagee and/or Leasehold Mortgagee, provided that in the event of any
conflict between the Fee Mortgage and the Leasehold Mortgage, the requirements
of the Leasehold Mortgage shall prevail, or (ii) by the Condominium
Declaration or the Condominium Board of Managers relative to the disbursement
of insurance proceeds, and Lessee and Lessor agree to comply with such
requirements.


 


11.05                   A.                                  Lessee will carry at all times during the Lease
term, at its own cost and expense, steam boiler (if not included in the insurance
obtained by the Condominium Board of Managers) and general liability insurance
for the benefit of both the Lessor and the Lessee in responsible insurance companies
indemnifying both Lessor and Lessee against claims for personal injuries
sustained in or about the Demised Premises, the sidewalks adjacent thereto, or
the vaults or vault spaces contiguous to the Demised Premises or elevators, in
an amount not less than Five Million Dollars ($5,000,000) for injuries or death
to one person and Fifteen Million Dollars ($15,000,000) for injuries or death
arising out of the same accident when more than one person is involved, and for
not less than One Million Dollars ($1,000,000) in respect to property
damage.  The public liability insurance shall
extend to any sidewalk elevators or exterior signs.  Lessee will deposit with Lessor a certificate
of the insurance carrier or carriers indicating that this insurance is in full
force and effect and that the premiums therefor have been paid.  If as of any anniversary of the date of this
Lease the U.S.  Consumer Price Index for
All Urban Consumers New York-Northeastern New Jersey (“CPI”) or similar
comparable index selected by Lessor if such index is no longer published or is
materially changed shall increase during the Lease term by more than five per cent
(5%) over that index prevailing at the Commencement Date of this Lease, then
the said limits of liability shall be increased (to the extent such increased
coverage is available) as of the date of such increase by the same percentage
amount as the percentage increase in the CPI, provided that in no event shall
the increase be greater than five percent (5%) of the amount of the liability
limit during the period preceding such anniversary date.  Lessee shall have the right to maintain all
such insurance under a blanket policy covering the Demised Premises and other
premises owned by Lessee and its affiliates.


 


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B.                                  The insurance
coverage described in Paragraph 11.05A has been determined based upon
the Lessee’s representations concerning its intended use of the Demised
Premises at the commencement of the term of this Lease.  In the event of a change in such use, the
coverage will be increased if a prudent lessor would customarily require an
increase in the coverage in such event.


 


11.06                   A.                                  All insurance
policies described in this Article 11 shall be for the benefit of
and cover Lessor, Lessee, the owner of the Tenth Floor Unit and any Fee
Mortgagee or Leasehold Mortgagee as the assureds as their respective interests
may appear, but the interest of any such mortgagee shall be covered by the
customary mortgagee endorsement employed in New York and shall be subject to
the provisions regarding “Leasehold Mortgages” and the other provisions
regarding disposition of insurance proceeds stated below in this Section 11.06.


 


B.                                  All insurance shall
be effected by valid enforceable policies issued by insurers of responsibility
and licensed to do business in the State of New York, such responsibility and
the insuring agreements to meet with the reasonable approval of Lessor.  The original insurance policies shall be
delivered to the first Leasehold Mortgagee who delivers the Leasehold Mortgagee’s
Notice described in Paragraph 15.01A and certificates of that insurance
shall be delivered to the holder of the Fee Mortgage, if there be one, or if
there be none, to Lessor.


 


i.                                       At least thirty (30)
days prior to the expiration date of any policy the original renewal policy for
that insurance shall be delivered by Lessee to the holder of the expiring
original policy, and certificates thereof, as the case may be, shall be
delivered to Lessor and any other Institutional Mortgagee described above,
together with satisfactory evidence of payment of the premium on that policy.  To the extent obtainable, all such policies
shall contain agreements by the insurers that:


 


1.                                    No act or omission by
the Lessee shall impair or affect the rights of the assureds to receive and
collect the proceeds under the policy;


 


2.                                    The policies shall
not be canceled except upon thirty (30) days’ prior written notice to each
named insured and loss payee; and


 


3.                                    The coverage afforded
thereby shall not be affected by the performance of any work in or about the Demised
Premises.


 


ii.                                    In addition, all
insurance policies under Section 11.0l shall contain to the extent
available at commercially


 


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reasonable prices
endorsements that the rights of the assured to receive and collect the proceeds
shall not be diminished because of any additional insurance carried by Lessee
on its own account.  If any such policy
does not contain such an endorsement, Lessee shall cause Lessor to be named as an additional insured on all
policies of such additional insurance carried by Lessee, and all other
provisions of this Article 11 shall apply to such policies.


 


11.07                   The following
provisions shall govern the policies described in Section 11.01;


 


A.                                Subject to this Section 11.07,
the policies shall also provide for any loss to be payable to any Leasehold
Mortgagee pursuant to a standard mortgagee clause or endorsement to be made a
part of the policy.  The loss shall be
adjusted with the insurance companies by Lessee, except that in case of any
particular casualty resulting in damage or destruction exceeding $50,000.00 in
the aggregate, no adjustment shall be made with the insurance companies without
the prior approval of Lessor, which approval shall not be unreasonably withheld
or delayed, unless a Leasehold Mortgagee shall have approved the amount of the
adjustment, in which event Lessor’s prior approval shall not be required.


 


B.                                  The loss shall be
payable:


 


i.                                       in the case of
casualty resulting in a loss payment not exceeding $200,000.00 (the “Threshold
Amount”), to Lessee subject however to the paramount rights of any Leasehold
Mortgagee under the standard mortgage clause or endorsement, or


 


ii.                                    in case of a casualty
resulting in a loss payment in excess of the Threshold Amount, to the Leasehold
Mortgagee, or if there is none to the Fee Mortgagee and if there be neither
then to a bank or trust company as insurance trustee designated by Lessee
(which shall be approved by Lessor, which approval shall not be unreasonably
withheld), in a notice given to the insurance companies and to Lessor promptly following
the occurrence of the casualty, which bank or trust company shall have its
principal office in the City of New York and must have a capital and surplus
account according to its last published statement in excess of Fifty Million
Dollars ($50,000,000), subject to CPI adjustment as provided in Paragraph
11.05A (such mortgagee or bank or trust company being referred to as the “Depository”).
 All policies to which this Section 11.07
applies shall expressly provide that loss thereunder shall be adjusted and paid
as required by this Section 11.07, if reasonably available.


 


C.                                  Insurance proceeds on
insurance described in Section 11.01 when not payable to Lessee
when so allowed by


 


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Paragraph 11.07B, shall be disbursed
as the work of restoration of the Demised Premises progresses or upon
completion thereof.


 


11.08                   Neither Lessor nor
Lessee shall be liable to the other for any loss or damage to property or
injury to or death of persons occurring at the Demised Premises or at the
property in which the Demised Premises are located, or in any manner growing
out of or connected with their use and occupation of their respective premises,
or the condition thereof, whether or not caused by the negligence of the Lessor
or Lessee, or of their respective agents, employees, subtenants, licensees or
assignees, to the extent that such loss or damage or injury to or death of persons
is covered by insurance regardless of whether such insurance is payable to or
protects Lessor or Lessee, or both.  Nothing
herein shall be construed to impose any other or greater liability upon either
Lessor or Lessee than would have existed in the absence of this provision.  This release shall be in effect only so long
as the applicable insurance policies contain a clause to the effect that this
release shall not affect the right of the insured to recover under such
policies.  Such clauses shall be obtained
by the parties whenever possible even if an additional premium is required to
be paid.  The releases contained herein
are not in substitution for, or in diminution of the hold harmless and
indemnification provisions of this Lease.


 


ARTICLE 12


 


TAXES


 


12.01                   A.                                  The Lessee shall pay
and discharge all duties, taxes, charges for water, sewer taxes, assessments
and payments (including, without limitation, the Common Charges described in
the Condominium Declaration chargeable to the Tenth Floor Unit and the Common
Elements and Limited Common Elements appurtenant thereto), extraordinary as
well as ordinary, whether foreseen or unforeseen, as shall, during the term of
this Lease, be laid, levied, assessed, or imposed upon the Demised Premises, or
become due and payable, or liens upon the Demised Premises, or any part
thereof, or any appurtenances thereto, the leasehold estate created by this
Lease, the sidewalks or streets in front of or adjoining the Demised Premises
or any vault or vaults under those sidewalks,
streets, or the Demised Premises, by virtue of any present or future law,
order, or ordinance of the United States of America, or of the City,
County, or other local government, or of any department, office, or bureau
thereof, or any other governmental authority or the Condominium Declaration.  The duties, taxes, charges, assessments, and
payments described in this Section 12.01 are sometimes referred to
in this Article and in


 


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Section 1.03 collectively as “Impositions” Lessee, at
Lessee’s sole cost and expense, shall cause to be prepared and timely filed all
returns and reports required by law to be filed in connection with the
Impositions and Lessor shall provide to Lessee on demand such information in
Lessor’s possession as Lessee shall reasonably require for such purpose.


 


B.                                  The term "Impositions" shall not
include, and nothing in this Lease shall require the Lessee to pay (i) any
inheritance, franchise, income, gross receipts, payroll, excise, privilege,
rent, estate or profit tax, (ii) any tax imposed on Lessor as a result of
Lessor not being considered a "United States person" as defined in Section 7701(a)(30)
of the Internal Revenue Code, (iii) any transfer tax imposed with respect
to consideration received for the sale, exchange or other disposition by Lessor
of the Demised Premises unless due in connection with the making of this Lease
or the conveyance of title to the Demised Premises to Lessee, in which case
Lessee shall pay one-half thereof, or (iv) any tax of similar nature, that
is, or may be, imposed upon the Lessor, unless those taxes shall be levied upon
the rent reserved in this Lease in the place of taxes upon the Demised
Premises.  Lessee shall pay any interest
or penalty arising out of Lessee’s failure to pay any Imposition when the same
is due and payable, and such amount shall be payable to Lessor upon demand as
additional rent.


 


12.02                   All Impositions shall be paid by the Lessee
when they become due and payable prior to the accrual of any interest or
penalty, to the department, officer, agent, board or bureau charged with the collection
thereof.


 


12.03.                All taxes, assessments, and water rents that
are mentioned above to be paid by Lessee shall be prorated and adjusted for the
fiscal years of the taxing authority in which the term of this Lease begins and
ends.


 


12.04                   In the case of assessments for local
improvements or betterments that are assessed or imposed during the term of this
Lease and that may be payable in installments, Lessee shall only be obligated
to pay the installments that fall due during the term of this Lease.


 


12.05                   In any suit or proceeding of any kind or
nature, arising out of the Lessee’s failure to keep any covenant contained in
this Article 12, the certificate or receipt of the department, officer,
agent, board or bureau charged with collection of the Imposition, showing that
the Imposition affecting the Demised Premises is due and payable, or has been
paid, shall be prima facie evidence that such Imposition was due and payable as a
lien or


 


24





















 


charge against the Demised
Premises or that it has been paid as such by the Lessor.


 


12.06                   The Lessee may
contest or review by legal proceedings or in any manner that Lessee in its
opinion shall deem reasonably necessary (which proceedings or other steps taken
by Lessee, if instituted, shall be conducted diligently at its own expense and
free of expense to the Lessor) any and all Impositions levied, assessed, or
imposed upon or against the Demised Premises or taxes in lieu thereof, required
to be paid by Lessee under this Lease. 
No such contest or review shall be undertaken in a manner that exposes
the Demised Premises or Lessor’s interest therein to jeopardy.  If such contest or review results in any
refund of an Imposition, such refund shall be first applied to reimbursement of
the Lessee’s out-of-pocket disbursements incurred in obtaining such refund and
the balance shall be pro-rated between the Lessor and Lessee according to the
ratio between the amount of the Imposition to which the refund relates and the
amount of which was actually paid by Lessee. 
The Lessor shall give to Lessee promptly after their receipt by the
Lessor copies of all bills for real estate taxes, water rates, Common Charges
and assessments (or the Lessor shall request the assessing authority or the Board
of Managers or its agents to give copies to the Lessee).


 


12.07                   Lessee upon request
of Lessor will promptly exhibit to Lessor all paid bills for real estate taxes,
water rates, Common Charges and assessments, which bills after inspection by
the Lessor shall be returned to Lessee.


 


12.08                   Notwithstanding Sections
12.01 through 12.07, Lessee agrees at the election of Lessor, to pay
to Lessor the Impositions imposed upon the Demised Premises not later than ten (10) days
before any such Imposition becomes due and payable and prior to the accrual of
any interest or penalty upon the Imposition. 
No interest will be paid by Lessor to Lessee on such payments by Lessee,
but the same will be kept by Lessor in a separate account and shall be employed
by Lessor to pay the Impositions when they come due.  If Lessee fails to make payment of all or any
part of such Imposition, then Lessor shall have no obligation to do so, and the
amount of any interest or penalty resulting from such non-payment shall be paid
by the Lessee as additional rent upon demand being made therefor by the Lessor
(provided Lessee has been given notice of the due date for such payment).


 


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ARTICLE 13


 


CONDEMNATION


 


13.01                   If any person or
corporation, municipal, public, private, or otherwise, shall at any time during
the term of this Lease lawfully condemn and by reason thereof acquire title to Lessor’s
interest in the Demised Premises, in or by condemnation proceedings in
pursuance of the law, general, special, or otherwise, the Lessor shall be
entitled to and shall, except as hereinafter provided, receive any award that
may be made, including the award, if any, to the Lessee for the value of the unexpired
term of this Lease, and the amount thereof shall be equitably apportioned
between Lessor and Lessee based on their respective interests in the Demised
Premises.  As between Lessee and any
mortgagee holding a mortgage inferior to this Lease, or other inferior lienor,
this relinquishment of Lessee’s interest in the award in favor of the Lessor is
not intended to lodge in that mortgagee or other inferior lienor, any right to
the interest so relinquished, which, in all circumstances, shall belong absolutely
to the Lessor, and is made on that condition accordingly, to be disbursed to
Lessee as part of the award for restoration as provided in this Article 13
should such restoration be made in the circumstances set forth in this Article 13.


 


13.02                   If title to the whole
or materially all of the Demised Premises shall be taken, this Lease shall
terminate and all rental, additional rent, and other charges under this Lease shall
be apportioned as of the date of vesting of title in such taking or proceedings.  For the purpose of this Article 13,
a taking of materially all of the Demised Premises, as distinguishable from a
taking of the whole of the Demised Premises, means a taking of such scope that
the untaken portion of the Demised Premises cannot reasonably be used by the
Lessee for the purposes for which the Lessee is then using the Demised
Premises.


 


13.03                   In the event of a
taking of less than materially all of the Demised Premises, this Lease (except
as hereinafter provided) shall nevertheless continue, but the annual net rental
to be paid by Lessee shall thereafter be reduced in the ratio that the rental
value of the portion of the Demised Premises taken bears to the rental value of
the entire Demised Premises at the time of the taking and Lessee shall promptly
restore the Demised Premises, as below provided.  The award for the taking in respect to the land
shall belong to the Lessor; and the award balance shall be used and paid in the
following priority:


 


A.                                First: so much as
shall be necessary to repair and restore
the Demised Premises to make the same a complete architectural unit as nearly
as reasonably possible to the


 


26





















 


condition existing prior to
the taking or condemnation shall be deposited with the Leasehold Mortgagee who
has delivered the Leasehold Mortgagee’s Notice described in Paragraph 15.01A
or if there be none with the Fee Mortgagee and if there be neither, then with a
bank or trust company as described in Paragraph 9.02E to be dispensed by
it in the manner set forth in Paragraph 9.02E.


 


B.                                  Second: the balance,
and all interest on the award (as well as the award for land value and interest
thereon) shall equitably apportioned between Lessor and Lessee based on their
respective interests in the Demised Premises.  The Lessee shall undertake the work of repair
and restoration as soon as reasonably practicable.


 


13.04                   Should the partial taking
described in Section 13.03: (i) be of such a nature or extent
that more than fifty percent (50%) of the Demised Premises remaining cannot
reasonably be used by the Lessee for the purposes for which the Lessee or its sublessees
or occupants are then using the Demised Premises, or (ii) occur during the
last five (5) years of the term, or (iii) result in damage or
destruction to the Building of such nature or the cost of repairing which is
such that the Condominium Board of Managers or the Condominium Unit owners
exercise any right under the Condominium Declaration not to repair the Building
such that repair of the Demised Premises cannot be repaired and restored, then
Lessee in any such event at its option, upon thirty (30) days’ prior notice to
Lessor, given at any time within sixty (60) days after the vesting of title in
the condemn or, may terminate this Lease. 
Upon that termination the net rental and other charges under this Lease
shall be apportioned as of the date of termination and the Lessee will be
discharged from responsibility to restore the Demised Premises.  Upon that termination the entire award
balance shall belong to Lessor, anything in this Article 13 to the
contrary notwithstanding.


 


13.05                   The Lessee shall have
no obligation to make the repair and restoration if the award applicable
thereto as provided in this Article 13 is insufficient for that
purpose, and if the Lessor does not agree to pay such insufficiency, the Lessee
shall have the option, upon thirty (30) days prior notice to Lessor, given at
any time within sixty (60) days after the vesting of title in the condemnor, to
terminate this Lease, and all of the other provisions of Paragraph 13.04
shall apply to such termination.


 


13.06                   This Lease shall not
be affected if the taking authority by the exercise of its power of eminent
domain shall take the use or occupancy of the Demised Premises or any part thereof
for a temporary period (hereafter, “temporary taking”).  The Lessee shall continue to pay, in the
manner and at the times specified in this Lease, the full amounts of the net
rent and all additional rent and other charges payable by the Lessee under this
Lease.


 


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Except only to
the extent that the Lessee may be prevented from so doing pursuant to the terms
of the order of the taking authority, Lessee shall continue to perform and
observe all of its other obligations under this Lease, as though the temporary
taking had not occurred.  Lessee shall be
entitled to receive the entire amount of any award made for the temporary
taking, whether paid by way of damages, rent, or otherwise, unless the period
of temporary use or occupancy shall extend to or beyond the expiration date of
the term of this Lease, in which case the award shall be apportioned between
Lessor and Lessee as of the date of expiration of the term, but Lessor shall in
that circumstance receive the entire portion of the award that is attributable
to physical damage to the Demised Premises and the restoration thereof to the
condition immediately prior to the taking unless the Lessee has performed such
restoration, in which case the Lessee shall receive that portion of the award
attributable to restoration of the Demised Premises to the extent of the actual
cost of such restoration paid by the Lessee.  The Lessee covenants that, upon the
termination of any temporary taking, prior to the expiration of the term, it
will, at its sole cost and expense, restore the Demised Premises, as nearly as
may be reasonably possible, to the condition in which the same were immediately
prior to the temporary taking subject to the limitations contained in Section 13.04.


 


ARTICLE 14


 


ASSIGNMENT; SUBLETTING


 


14.01                   If Lessee’s interest in this Lease is assigned,
whether or not in violation of the provisions of this Lease, Lessor may collect
rent from the assignee; if the Demised Premises or any part thereof are sublet
to, or occupied by, or used by, any person other than Lessee, whether or not in
violation of this Lease, Lessor, after default (as defined in Article 17)
by Lessee under this Lease and expiration of Lessee’s time, if any, to cure
such default, may collect rent from the subtenant, user or occupant.  In either case, Lessor shall apply the net
amount collected to the rents reserved in this Lease, but neither any such
assignment, subletting, occupancy, nor use, nor any such collection or
application shall be deemed a waiver of any terms, covenant or condition of
this Lease or the acceptance by Lessor of such assignee, subtenant, occupant or
user as a tenant.  The consent by Lessor
to any assignment, subletting, occupancy or use shall not relieve Lessee from
its obligation to obtain the express prior written consent of Lessor to any
further assignment, subletting, occupancy or use.  Neither any assignment of Lessee’s interest
in this Lease nor any subletting, occupancy or use of the Demised Premises or
any part thereof by any person other than Lessee, nor


 


28





















 


any collection of rent by
Lessor from any person other than Lessee as provided in this Section 14.01,
nor any application of any such rent as aforementioned as provided in this Section 14.01,
shall in any circumstances relieve Lessee of Lessee’s obligations fully to
observe and perform the terms, covenants and conditions of this Lease on Lessee’s
part to be observed and performed.


 


14.02                   Lessee may sublet
portions of the Demised Premises for occupancy by subtenants, provided that the
Lessee shall not be in default (as defined in Article 17) in the
performance of any of its obligations under this Lease, but may not sublet the
whole or substantially the whole of the Demised Premises without the prior
written consent of the Lessor, which consent Lessor agrees not to unreasonably
withhold or delay.  All subleases made by
the Lessee shall be in writing (other than to transient occupants of hotel
rooms for a period of less than thirty (30) days and existing rent regulated
tenants as to whom the law imposes no requirement for a written lease) and
shall be expressly subject to the terms of this Lease, and all subleases are
assigned to the Lessor (subject, however, and subordinate to the right of the
Leasehold Mortgagee who has given the Leasehold Mortgagee’s Notice described in
Paragraph 15.01A to require assignment of such subleases to it),
provided, however, that the Lessee may collect the rents and charges under
those subleases and take any action necessary to perform its obligations as
sublessor thereunder so long as Lessee is not in default (as defined in Article 17)
under this Lease.  In no event may Lessee
collect any advance rent for a period beyond a current month, and Lessee
covenants not to make any such advance collections of rent, but this
restriction shall not prevent Lessee from collecting security deposits from
subtenants to secure their performance of their subleases.  This assignment does not impose any liability
on Lessor in respect to the landlord’s obligations under those subleases; and
no such liability shall arise unless and until Lessor resumes possession of the
Demised Premises.  Any such sublease made
by Lessee (other than to transient occupants of hotel rooms for a period of
less than thirty (30) days and existing rent regulated tenants) will contain a
provision in substance calling attention to the assignment to the Lessor of the
sublease, the prohibition against the collection of advance rent beyond the
current month period, and limitation of the Lessor’s liability under the
assignment of the sublease to the Lessor, all as stated in this Section 14.02.  Lessee will execute any further instruments
and assurances in confirmation of the foregoing assignment of subleases as may
be reasonably required by Lessor.  Each
sublease made by Lessee (other than to transient occupants of hotel rooms for a
period of less than thirty (30) days and existing rent regulated tenants) will
contain a provision in substance that if there be any termination whatever of
this Lease between the Lessor and the Lessee, then the subtenant, at the option
of the Lessor, will attorn to the Lessor and the sublease shall continue in
effect


 


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with the
Lessor; but the Lessor shall be bound under the sublease only by privity of
estate.


 


14.03                   A.                                  Lessee may assign its interest in this Lease or
sublet the whole or substantially the whole of the Demised Premises with the
prior written consent of the Lessor, which consent Lessor agrees not to
unreasonably withhold or delay.  Lessor
shall not withhold its consent based on the financial condition of the proposed
assignee or sublessee to any subletting or assignment for which its consent is
required when the proposed transferee or its guarantor has a “Triple A-l”
credit rating by Dun & Bradstreet (or successor organization),
provided, however, that lack of such a rating shall not be conclusive with
respect to whether Lessor is unreasonable in withholding its consent if it does
so.


 


B.                                  Notwithstanding the provisions of this Lease,
provided Lessee is not then in default (as defined in Article 17) Lessee
may assign this Lease or sublet the whole or substantially all of the Demised
Premises to any owner or lessee of the EBC Unit or the Modified Hotel Unit or
to Educational Broadcasting Corporation, Lessee’s predecessor as tenant of the
Demised Premises, or an affiliate of Educational Broadcasting Corporation (as
defined in Section 29.06 of this Lease), without the consent of
Lessor, provided Lessee submits to Lessor at least ten (10) days prior to
the effective date of such assignment or sublet all of the following: (1) the
name and address of the proposed assignee or subtenant and, if the proposed
assignee or subtenant is not a natural person the nature of the entity and the
date and state or other jurisdiction of its formation; (2) an executed
copy of the assignment or sublease agreement; and (3) an agreement
executed and acknowledged in the form required for recording of a deed by the
assignee or the sublessee to perform all of the obligations of the Lessee under
this Lease, including, without limitation, all obligations of the Lessee
unfulfilled on the effective date of the sublease or assignment.


 


14.04                   If Lessee proposes to assign this Lease, or any
interest in it, or to sublet all or substantially all of the Demised Premises
other than as permitted by Paragraph 14.03B, Lessee shall submit to
Lessor in writing: (1) the name of the proposed assignee or subtenant and,
if the proposed assignee or subtenant is not a natural person, the nature of
the entity and the date and state or other jurisdiction of its formation; (2) an
executed copy of the assignment or sublease agreement; (3) an agreement
executed and acknowledged in the form required for recording a deed by the
assignee or sublessee to perform all of the obligations of the Lessee under
this Lease including, without limitation, all obligations of the Lessee
unfulfilled on the effective date of the sublease or assignment and (4) any
other information reasonably requested by Lessor.  Lessee may, at its option, seek Lessor’s
approval, initially, to only the identity of


 


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the assignee or subtenant
referred to in this Paragraph, provided Lessee gives the Lessor the information
referred to in subparagraphs (1) and (4) and a summary of the
proposed transaction, and Lessor shall not unreasonably withhold or delay its
consent to the identity of such assignee or subtenant or proposed terms
provided that all of the conditions of Paragraph 14.05 are complied
with.  In such event, Lessee need only
seek Lessor’s approval to the agreements referred to in subparagraphs (2) and
(3) and provide Lessor with any other information reasonably requested by
Lessor in connection with its review of such documents, which approval shall
not be unreasonably withheld or delayed.


 


14.05                   Any consent to an
assignment or subletting which requires the Lessor’s consent shall be
conditioned upon the following:


 


(i)                                  Lessee shall not be
in default (as defined in Article 17) in the performance of any of
its obligations under this Lease and no event shall then exist which with the
giving of notice or the passage of time or both would constitute a default
under Article 17;


 


(ii)                               the proposed transferee
shall not impose a material additional burden upon the Building’s systems or
equipment owned by the Condominium or the Lessor serving the Demised Premises
or the services provided by the Condominium or the Lessor to the Demised
Premises;


 


(iii)                            the proposed
transferee shall not be a governmental or quasi-governmental agency (unless it
is a Leasehold Mortgagee which has given the Leasehold Mortgagee’s Notice under
Section 15.01);


 


(iv)                           the proposed
transferee shall not be entitled, directly or indirectly, to diplomatic or
sovereign immunity and shall be subject to the service of process in, and the
jurisdiction of the courts of New York State.


 


(v)                              posting of the
security required by Section 10.02 of this Lease, to the extent
that Section 10.02 requires the posting of security in the case of
such assignment or subletting.


 


14.06                   The following events
shall be deemed, in each instance, an assignment requiring the Lessor’s consent
(except as otherwise permitted in Paragraph 14.03B) within the meaning
of this Article 14:


 


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A.                                a devolution by operation of law of the Lessee’s
interest in the whole or substantially the whole of the Demised Premises;


 


B.                                  a change in ownership of stock or other
ownership interest in the Lessee however denominated exceeding fifty percent
(50%) of the voting stock or other ownership interest which is issued and
outstanding at the date of this Lease or in the case of a permitted assignment
of this Lease, such stock or other ownership interest in the assignee issued
and outstanding on the effective date of the assignment;


 


C.                                  licensing the use of the whole or substantially
the whole of the Demised Premises or a part thereof;


 


D.                                 any device designed to circumvent the
limitations imposed by this Section 14.06.


 


14.07                   When under the provisions of this Article 14
a consent is required it means a written consent, and no inferences shall be
drawn from Lessor’s conduct or inaction that a consent has been given de
facto.


 


14.08                   Without limiting what would constitute reasonable
grounds for Lessor’s withholding of approval of any sublease or assignment for
which its consent is required, in no circumstance shall Lessor be required to
give its approval if the sublease or assignment: (1) calls for the
granting of a concession in rent by the Lessor at any time; or (2) would
impose upon the Lessor any obligation to make alterations or to pay the sublessee
or assignee for alterations made by it.


 


14.09                   A.                                  This Section 14.09 applies to any sublease
made by Lessee as lessor to a sublessee (referred to in this Section 14.09
as an “occupant”) for space in the Demised Premises, if (i) such sublease
has been first approved by Lessor [which approval Lessor shall not unreasonably
withhold or delay when the occupant has a “Triple A-1” credit rating by Dun &
Bradstreet (or successor organization)], and (ii) the occupant requests a “nondisturbance
agreement” from the Lessor as a condition to executing the sublease.


 


B.                                  If conditions (i) and (ii) of Paragraph
14.09A are met, then Lessor will make a bilateral agreement with the
occupant that in substance shall provide that:


 


i.                                       If this Lease shall terminate by reason of
Lessee’s default, then Lessor will not disturb the occupancy of the occupant in
the space let to it so long as the occupant abides by and performs each and all
the terms and conditions of the sublease;


 


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ii.                                    If this Lease shall
so terminate, the occupant at the request of Lessor shall attorn to Lessor, and
upon the ending of this Lease, the liability of Lessor to the occupant shall
not be in contract, but shall derive solely by virtue of privity of estate; and


 


iii.                                 Lessor shall not be
bound in respect to liabilities of Lessee accrued prior to the ending of this
Lease, or be bound to repay or refund to the occupant any sum of money that the
Lessee has assumed to repay or refund to the occupant unless the amount thereof
has been theretofore deposited with Lessor.


 


14.10                   Nothing in this Article 14
shall be deemed to permit any further assignment or subletting by any assignee
or sublessee, provided, however, that any assignee or subtenant may further
assign or sublet its interest, provided it complies with all of the provisions
of this Article 14, including obtaining any consents of the Lessor
required therein.


 


ARTICLE 15


 


LEASEHOLD MORTGAGE


 


15.01                   Lessee may make a
mortgage or mortgages on its interest in this Lease to secure indebtedness to
an Institutional Mortgagee.  The term “Leasehold
Mortgage” shall include a mortgage, deed of trust, a deed to secure debt, or
other security instrument by which Lessee’s leasehold interest is mortgaged,
conveyed, assigned or otherwise transferred, to secure a debt or other
obligation.


 


A.                                 Upon receipt by
Lessor of a notice (a “Leasehold Mortgagee’s Notice”) from the holder of any
Leasehold Mortgage (each, a “Leasehold Mortgagee”) specifying such Leasehold
Mortgagee’s name and address, and accompanied by a true and complete copy of
such Leasehold Mortgage, such Leasehold Mortgagee shall have all of the rights
and benefits provided in this Article 15.  All references to a Leasehold Mortgagee in
the remainder of this Article shall mean and refer to a Leasehold
Mortgagee which has delivered a Leasehold Mortgagee’s Notice.


 


B.                                   If Lessor shall serve
upon Lessee any notice of default, Lessor shall also serve a copy of such
notice upon each Leasehold Mortgagee, in the manner required by Paragraph I
of this Section 15.01.  No
notice of default from Lessor to Lessee shall be deemed to have been duly given
unless and until a copy thereof has been so served.  Each Leasehold Mortgagee shall have the
right, but not the obligation, to remedy such default, or cause the same to be
remedied, within twenty (20) days after the expiration of all


 


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applicable grace or cure
periods provided to Lessee pursuant to the terms hereof, and Lessor shall
accept such performance by or at the instance of such Leasehold Mortgagee as if
the same had been made by Lessee.


 


C.                                   Notwithstanding
anything in this Lease to the contrary, if, pursuant to the provisions of this
Lease or as a matter of law, Lessor shall have the right to terminate this
Lease, then Lessor shall take no action to terminate this Lease without first
giving to each Leasehold Mortgagee written notice of such right (a “Termination
Notice”) at least 30 days in advance of the proposed effective date of such
termination if such default is capable of being cured by the payment of money,
and at least 45 days in advance of the proposed effective date of such termination
if such default is not capable of being cured by the payment of money.  The provisions of Paragraph D below of
this Section 15.01 shall apply if, during such 30 or 45 day
Termination Notice period, any Leasehold Mortgagee shall:


 


(i)                                  notify Lessor of such
Leasehold Mortgagee’s desire to nullify such notice; and


 


(ii)                               pay or cause to be
paid all rent, additional rent, and other payments then due and in arrears as
specified in the Termination Notice to such Leasehold Mortgagee and which may
become due during such 30 or 45-day period; and


 


(iii)                            comply or in good
faith, with reasonable diligence and continuity, commence to comply with all nonmonetary
requirements of this Lease then in default and reasonably susceptible of being
complied with by such Leasehold Mortgagee.  Time of the Leasehold Mortgagee to cure any
default by Lessee that reasonably requires that Leasehold Mortgagee be in
possession of the Demised Premises to do so, shall be deemed extended to
include the period of time required by the Leasehold Mortgagee to obtain
possession with due diligence; provided, however, that during this period all
of Lessee’s other obligations under this Lease are being duly performed.  The foregoing sentence shall not be construed
as a waiver of the right of the Leasehold Mortgagee to receive notice of other
defaults nor to shorten the time of the Leasehold Mortgagee to cure any other
defaults.


 


D.                                  (i)                                    If Lessor shall elect
to terminate this Lease by reason of any default of Lessee, and a Leasehold
Mortgagee shall have proceeded in the manner provided for by Paragraph C
of this Section 15.01, the specified date for the termination of
this Lease as fixed by Lessor in its Termination Notice shall be extended for a
period of six (6) months, provided that such Leasehold Mortgagee shall,
during such six (6) month period:


 


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1.                                    pay or cause to be
paid the rent, additional rent and other monetary obligations of Lessee under
this Lease as the same become due, and continue its good faith efforts to
perform all of Lessee’s other obligations under this Lease, excepting past nonmonetary
obligations then in default and not reasonably susceptible of being cured by
such Leasehold Mortgagee; and


 


2.                                    take steps to acquire
or sell Lessee’s interest in this Lease by foreclosure of the Leasehold
Mortgage or other appropriate means and prosecute the same to completion with
due diligence.


 


(ii)                               If at the end of such
six (6) month period such Leasehold Mortgagee has not after reasonably
diligent and good faith efforts obtained possession of the Demised Premises or
any part thereof, or access thereto for the purpose of performance of Lessee’s
obligations for which access is required, and is complying with subparagraph
D(i) except for the performance of obligations of the Lessee under
this Lease which cannot be performed without such access, this Lease shall not
then terminate, and the time for completion by such Leasehold Mortgagee of its
proceedings shall continue for so long as such Leasehold Mortgagee proceeds to
complete steps to acquire or sell Lessee’s interest in this Lease by
foreclosure of the Leasehold Mortgage or by other appropriate means with
reasonable diligence and continuity, and in the instance where the Leasehold
Mortgagee has not gained access to the Demised Premises, the Leasehold
Mortgagee proceeds to completion steps to gain such access with reasonable
diligence and continuity.  Nothing in
this Paragraph 15.01D however shall be construed to extend this Lease
beyond the original term thereof.


 


(iii)                            If a Leasehold
Mortgagee is complying with subparagraph D(i) of this Section 15.01,
upon the acquisition of Lessee’s estate herein by such Leasehold Mortgagee or
its designee by foreclosure or assignment of Lessee’s interest herein in lieu
of foreclosure, or by any other purchaser at a foreclosure sale including,
without limitation, an entity formed by a Leasehold Mortgagee (and the
discharge of any lien, charge or encumbrance against the Lessee’s interest in
this Lease or the Demised Premises which is junior in priority to the lien of
the Leasehold Mortgage held by such Leasehold Mortgagee and which the Lessee is
obligated to satisfy and discharge by reason of the terms of this Lease), this
Lease shall continue in full force and effect as if Lessee had not defaulted
under this Lease, and any default by Lessee not susceptible of being
cured by a Leasehold Mortgagee which has obtained possession of the Demised
Premises shall be deemed to have been waived.


 


(iv)                           Notwithstanding the
foregoing, a Leasehold Mortgagee shall not be obligated to continue such
possession or to


 


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continue such foreclosure
proceedings after such default shall have been cured.


 


E.                                    In the event of the
expiration of this Lease as a result of the Lessor giving to the Lessee the
notice described in Section 17.02 of this Lease, Lessor agrees to
enter into a new lease (“New Lease”) of the Demised Premises with the Leasehold
Mortgagee or its designee for the remainder of the original term of this Lease,
effective as of the date of expiration pursuant to such notice, at the rent and
additional rent, and upon the terms, covenants and conditions (excluding
requirements which are not applicable or which have already been fulfilled) of
this Lease, provided:


 


(i)                                  Such Leasehold
Mortgagee shall make written request upon Lessor for such New Lease within
sixty (60) days after the date of service by Lessor upon such Leasehold
Mortgagee of notice of the expiration of this Lease given pursuant to this Paragraph
15.01E.


 


(ii)                               Such Leasehold
Mortgagee or its designee shall pay or cause to be paid to Lessor at the time
of the execution and delivery of such New Lease, any and all sums which would
at the time of execution and delivery thereof be due pursuant to this Lease but
for such expiration and, in addition thereto, all reasonable expenses,
including without limitation reasonable attorney’s fees, which Lessor shall
have incurred by reason of such expiration, the default giving rise thereto,
the steps taken by Lessor to protect its interest in connection therewith, and
the execution and delivery of the New Lease and which have not otherwise been
received by Lessor from Lessee or other party in interest under Lessee.


 


(iii)                            Such Leasehold
Mortgagee or its designee shall agree to remedy any of Lessee’s defaults of
which said Leasehold Mortgagee was notified by Lessor and which are reasonably
susceptible of being so cured by Leasehold Mortgagee or its designee.


 


(iv)                           The Lessee under such
New Lease shall have the same right, title and interest in and to the Demised
Premises and the buildings and improvements thereon as Lessee had under this
Lease.


 


(v)                              The tenant under any
such New Lease shall be liable to perform the obligations imposed on the Lessee
by such New Lease only during the period such person has ownership of such
Leasehold Estate.


 


F.                                    If more than one
Leasehold Mortgagee shall request a New Lease pursuant to subparagraph E(i)
of this Section 15.01,


 


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Lessor shall enter into such
New Lease with the Leasehold Mortgagee whose mortgage is prior in lien, or with
the designee of such Leasehold Mortgagee.  Lessor, without liability to Lessee or any
Leasehold Mortgagee with an adverse claim, may rely upon a mortgagee title
insurance policy issued by a responsible title insurance company doing business
within the state of New York as the basis for determining the appropriate
Leasehold Mortgagee who is entitled to such New Lease.


 


G.                                   For the purposes of
this Section l5.0l, the making of a Leasehold Mortgage shall not be
deemed to constitute an assignment or transfer of this Lease or of the
leasehold estate hereby created, nor shall any Leasehold Mortgagee, as such, be
deemed to be an assignee or transferee of this Lease or of the leasehold estate
hereby created so as to require such Leasehold Mortgagee, as such, to assume
the performance of any of the terms, covenants or conditions on the part of the
Lessee to be performed hereunder, but the purchaser at any sale of this Lease
and of the leasehold estate hereby created in any proceedings for the
foreclosure of any Leasehold Mortgage, or the assignee or transferee of this
Lease and of the leasehold estate hereby created under any instrument of
assignment or transfer in lieu of the foreclosure of any Leasehold Mortgage
shall be deemed to be an assignee or transferee within the meaning of this Section 15.01,
and shall be deemed to have agreed to perform all of the terms, covenants and
conditions on the part of the Lessee to be performed hereunder from and after
the date of such purchase and assignment, but only for so long as such
purchaser or assignee is the owner of the leasehold estate.  If the
Leasehold Mortgagee or its designee shall become holder of the leasehold estate
and if the Demised Premises shall have been or become materially damaged on,
before or after the date of such purchase and assignment, the Leasehold
Mortgagee or its designee shall be obligated to repair, replace or reconstruct
the Demised Premises only to the extent of the net insurance proceeds received
by the Leasehold Mortgagee or its designee by reason of such damage.


 


H.                                  Notwithstanding any
other provisions of this Lease, any sale of this Lease and of the leasehold
estate hereby created in any proceedings for the foreclosure of any Leasehold
Mortgage, or the assignment or transfer of this Lease and of the leasehold
estate hereby created in lieu of the foreclosure of any Leasehold Mortgage
shall be deemed to be a permitted sale, transfer or assignment of this Lease
and of the leasehold estate hereby created not requiring the Lessor’s consent.


 


I.                                       (i)                                    Any notice or other
communication which Lessor shall desire or is required to give to or serve upon
a Leasehold Mortgagee shall be in writing and shall be served in the same
manner as required by Article 21 of this Lease for notices to
Lessee, except that such notice shall be delivered to each


 


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Leasehold Mortgagee at the
address for notices set forth in such Leasehold Mortgagee’s most recent
Leasehold Mortgagee’s Notice, or at such other address as such Leasehold
Mortgagee shall have last designated by written notice to Lessor.


 


(ii)                               Any notice or other
communication which a Leasehold Mortgagee shall desire or is required to give
to or serve upon Lessor shall be in writing and shall be served in the manner
provided for notices given to Lessor by Lessee at the address set forth for
that purpose under Article 21 of this Lease.


 


J.                                      So long as any
Leasehold Mortgage is in existence, no union of the interests of Lessor and
Lessee shall result in a merger of this Lease into any superior leasehold
interest or the fee interest in the Demised Premises.


 


K.                                  A Leasehold Mortgagee
may enforce its rights under its Leasehold Mortgage and acquire title to Lessee’s
interest in the Demised Premises in any lawful way, and pending foreclosure of
such Leasehold Mortgage, take possession of the Demised Premises.  If a Leasehold Mortgagee or its designee or
wholly owned subsidiary shall acquire title to Lessee’s interest in this Lease
by foreclosure, by assignment in lieu of foreclosure, or under a New Lease,
then such Leasehold Mortgagee, or such designee or wholly owned subsidiary may
freely assign this Lease and thereupon shall be released from all liability for
performance or observance of the covenants and conditions in this Lease from
and after the date of such assignment; provided that all rent and additional
rent due to Lessor hereunder has been paid to the date of assignment and that
the assignee has delivered to Lessor its written agreement to be bound by all
the terms, covenants, conditions and provisions of this Lease.


 


L.                                    From and after receiving
a Leasehold Mortgagee’s Notice, Lessee and Lessor shall not enter into any
agreement providing for the surrender, cancellation, amendment or modification
of this Lease, and Lessor shall not accept a surrender of this Lease from
Lessee, without the prior written consent of each Leasehold Mortgagee, and no
such surrender, cancellation, amendment or modification shall be binding on a
Leasehold Mortgagee without the prior written consent of such Leasehold
Mortgagee.


 


M.                               Subject to Section 11.07
of this Lease, upon the Leasehold Mortgagee’s request, the name of such
Leasehold Mortgagee may be added to the “Loss Payable Endorsement” of any and
all insurance policies required to be carried by the Lessee under this Lease.


 


N.                                  Notwithstanding
anything in this Lease to the contrary, in the event of any casualty to or
condemnation of the Demised Premises or any portion thereof during such time as
any


 


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Leasehold Mortgage shall
remain unsatisfied, the Leasehold Mortgagees shall be entitled to participate
in any adjustment of losses and condemnation proceedings, to receive all
insurance proceeds and/or condemnation awards otherwise payable to Lessee or
Lessor or both (up to the amount of the indebtedness secured by the Leasehold
Mortgages), and (a) to disburse them for restoration and/or repair of the
Demised Premises, and (b) with respect to all condemnation awards and
insurance proceeds not required for the restoration and/or repair of the
Demised Premises, to apply them in accordance with the Leasehold Mortgages.


 


O.                                  Lessor agrees
promptly to execute, acknowledge and deliver any modifications to this Lease
reasonably requested by any Leasehold Mortgagee, provided that such
modifications do not alter the rent, additional rent or other economic terms of
this Lease or the Option (the term “Option” having the meaning set forth in Article 31
of this Lease), change the duration of the term, diminish the Lessee’s
obligations, or in any way materially impair or reduce Lessor’s rights under
this Lease or the Contract of Sale, or Lessor’s interest in the Demised
Premises.  In addition, from time to time
upon the request of a Leasehold Mortgagee, Lessor shall execute and deliver to
such Leasehold Mortgagee an estoppel certificate containing the information
described in Section 27.02 and such other information as such
Leasehold Mortgagee may reasonably request.


 


P.                                    Lessor and Lessee
acknowledge and agree that except as otherwise provided in the Condominium
Declaration or By-laws, for so long as this Lease or any New Lease shall be in
effect, Lessee (or the holder of Lessee’s interest in this Lease or any New
Lease) shall own any and all personal property in or about the Demised
Premises.  Lessor hereby consents to
Lessee’s grant, if any, to each Leasehold Mortgagee of a security interest in
the personal property owned by Lessee and located at the Demised Premises and a
collateral assignment of subleases by Lessee of all or any portion of the
Demised Premises and the rents, issues and profits therefrom, if any.  Lessor agrees that any interest that Lessor
may have in such personal property or subleases, as the case may be, whether
granted pursuant to this Lease or by statute, shall be subordinate to the
interest of any such Leasehold Mortgagee.


 


Q.                                  No Leasehold
Mortgagee shall become liable under this Lease, unless it becomes, and then
only for obligations accruing as long as it remains, the owner of the leasehold
estate.


 


R.                                   If any Leasehold
Mortgagee, its designee or other purchaser has acquired the leasehold estate of
Lessee pursuant to foreclosure, conveyance in lieu of foreclosure, or other
proceedings, such Leasehold Mortgagee, its designee or other purchaser shall
succeed to the rights of Lessee, if any, in and to the security deposit paid by
Lessee to Lessor pursuant to


 


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Article 10 of this Lease. 
In such event, Lessee shall no longer have any rights to such security
deposit, and Lessor shall hold such security deposit for and on behalf of such
Leasehold Mortgagee, its designee or other purchaser.


 


15.02                   Concurrently with the execution and delivery of
any New Lease, Lessor shall assign to the tenant named therein all of its
right, title and interest in and to moneys (including insurance proceeds and
condemnation awards), if any, then held by or payable to Lessor which Lessee
would have been entitled to receive but for the termination of this Lease.  Upon the execution of any New Lease, the
tenant named therein shall be entitled to any rent received under any sublease
in effect during the period from the date of termination of this Lease to the
date of execution of such New Lease.  Effective
upon the commencement of the term of any New Lease, all subleases shall be
assigned and transferred to the tenant under the New Lease.


 


15.03                   Any Fee Mortgage encumbering the Demised Premises
shall be subordinate to (A) this Lease and any amendment, renewal or
modification of this Lease and (B) any Leasehold Mortgage encumbering this
Lease and any amendment, renewal, modification or refinancing of any such
Leasehold Mortgage; provided, however, that if a prospective Fee Mortgagee of
the Tenth Floor Unit requests that the holder of a Leasehold Mortgage
encumbering this Lease subordinate such Leasehold Mortgagee’s interest in the Demised
Premises to the interest of such prospective Fee Mortgagee and the prospective
Fee Mortgagee enters into a subordination, non-disturbance and attornment
agreement reasonably satisfactory to Lessee and such Fee Mortgagee whereby such
Fee Mortgagee agrees not to disturb the Lessee’s possession of the Tenth Floor
Unit so long as Lessee is not in default in the performance or observance of its
obligations under this Lease beyond all notice and cure periods, then Lessee shall
request and use reasonable efforts to cause the Leasehold Mortgagee to
subordinate its interest in this Lease to the interest of the Fee Mortgagee in
the Tenth Floor Unit.  If the Leasehold
Mortgagee agrees, the parties shall execute a subordination of this Lease and
the Leasehold Mortgage.


 


ARTICLE 16


 


CURING DEFAULTS


 


16.01                   Should Lessee fail to perform any of its
obligations under this Lease within thirty (30) days after the Lessor has given
written notice of such failure to Lessee (but in any event, regardless of that
notice or the lack thereof, promptly before the accrual of any penalty as
provided by law, or under the Condominium


 


40


















 


Declaration)
the Lessor may perform those obligations and add any such sum or sums paid or
expended in that performance, to any rent then due or thereafter falling due
under this Lease with like effect as if an original part of that installment,
and that sum or sums shall be and become additional rental. This Article 16,
however, does not grant Lessee any license or privilege to allow the Demised
Premises to be without the insurance coverage provided by Article 11,
and the failure promptly to comply with Article 11 shall entitle the
Lessor to place immediately the necessary insurance, and the cost thereof shall
be additional rent and collectible as such. The thirty (30) day notice provided
by this Article 16 is the same thirty (30) day notice provided by Article
17 and not an additional one. Notwithstanding Lessor’s placement of
insurance or right to do so as provided in this Section 16.01, Lessee’s
failure to obtain and maintain in full force and effect the insurance coverage
required by Article 11 within the thirty (30) day cure period afforded
by such notice shall constitute a default under Paragraph 17.01 of this
Lease.


 


16.02.      The
Lessor agrees to give the Lessee prompt notice of its payment of any sum or
sums referred to in Section 16. 01.


 


16.03.      Should
Lessor fail to pay any amount which Lessor is required to pay under Section
1.06 of this Lease after receipt of such amount from the Lessee, within
thirty (30) days after the Lessee has given written notice of such
failure to the Lessor, then, provided that Lessee is not in default (as defined
in Article 17 of this Lease) in the performance of any Lessee’s
obligations under this Lease, the Lessee may pay such sums which Lessor has
failed to pay to the party to whom owed and set off such amount so paid against
the next installment(s) of rent then due or thereafter falling due under this
Lease.


 


16.04.      The
Lessee agrees to give the Lessor prompt notice of its payment of any sum or
sums referred to in Section 16.03.


 


16.05.      Lessor
and Lessee each agrees to promptly give the other copies of any notices
received from the Condominium alleging any default in the performance of their
obligations under the Condominium with respect to the Demised Premises or which
may affect the use and enjoyment of the Demised Premises.


 


ARTICLE 17


 


DEFAULTS


 


17.01.      Each
of the following shall be deemed a “default” by Lessee:


 


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A.            Lessee’s
failure to pay any installment of rent or to pay any additional rent, which
failure persists after the expiration of thirty (30) days from the date Lessor
gives notice to Lessee of the existence of such failure;


 


B.            Lessee’s
failure to observe or perform any of its other obligations under the other
terms, covenants, or conditions of this Lease, which failure persists after the
expiration of thirty (30) days from the date Lessor gives notice to Lessee of
the existence of that failure, but, if the matter that is the subject of the
notice is of such a nature that it cannot be reasonably corrected within thirty
(30) days, then no default shall be deemed to have occurred if Lessee commences the curing of the default
within such thirty (30) day period and diligently prosecutes the same to
completion; however, if the default is one relating to a matter that exposes
space, occupants or the public to a danger to safety or health of which the
public authorities have given due notice to Lessee, then such shorter notice to
Lessee, whether written or otherwise, shall be sufficient as the circumstances
demand with the responsibility of Lessee to take corrective measures forthwith;


 


C.            Lessee’s
failure, after ten (10) days’ notice thereof by Lessor, to pay or cause to be
paid, before any fine, penalty, interest or cost may be added thereto, any
Imposition or insurance premium payable by Lessor.


 


D.            The
commencement of a proceeding against Lessee seeking reorganization,
liquidation, dissolution or similar relief in an involuntary case under any
applicable bankruptcy, insolvency or other similar law or code now or hereafter
in effect which proceeding remains undismissed for a period of sixty (60) days,
or the entry of a decree of order in any court appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
Lessee or of any substantial part of its property, or ordering
the winding-up or liquidation of its affairs, which decree or order shall
remain unstayed and in effect for a period of sixty (60) days.


 


E.             Commencement
by Lessee of a voluntary case under any applicable bankruptcy, insolvency or
other similar law or code now or hereafter in effect, or Lessee’s consent to
the entry of an order for relief in an involuntary case under any such law or
code, or consent to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator (or other similar
official) of Lessee or of any substantial part of its property, or the making
by Lessee of any general assignment for the benefit of creditors, or failure
generally to pay its debts as they become due, or the taking by Lessee of any
corporate or partnership action in furtherance of any of the foregoing.


 


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17.02       Should
Lessee default as defined in Section 17.01, Lessor at any time
thereafter may, at its option, give Lessee ten (10) days’ written notice of
intention to end the term of this Lease and thereupon at the expiration of
those ten (10) days the term of this Lease shall expire as completely as if
that date were the date definitely fixed in this Lease for the expiration of
the term and Lessee will then quit and surrender the Demised Premises to
Lessor, but Lessee shall remain liable as provided in this Article 17.


 


17.03       If the notice provided for in Section
17.02 shall have been given and the term of this Lease shall expire as
described in that Section, or if this Lease shall be taken from Lessee as a
result of any execution against Lessee in any proceeding in which the Lessee
shall have no appeal or further appeal, then Lessor may without notice re-enter
the Demised Premises and dispossess Lessee by summary proceedings or otherwise,
and Lessee or other occupant or occupants of the Demised Premises will remove
their effects and leave the Demised Premises as if this Lease had not been made,
and Lessee waives the service of notice of intention to re-enter or to
institute legal proceedings to that end.


 


In case of any default, re-entry, expiration or
dispossess by summary proceedings or otherwise:


 


A.            Rent
shall become due thereupon and be paid up to the time of that re-entry,
dispossess, or expiration, together with (i) interest from the date such rent
became due until the date of actual payment at a rate equal to the “prime rate”
of interest identified as such from time to time during the period such
interest accrues in the Wall Street Journal, or if the Wall Street Journal
is not published or does not contain such  information, then the interest rate announced
from time to time by Citibank, N.A., New York, New York, as its “prime rate” or
“base rate”, and (ii) any expenses that Lessor may incur for reasonable legal
expenses and attorneys’ fees, including those incident to the recovery of
possession, brokerage, and putting the Demised Premises in good order, or for
preparing the same for re-rental;


 


B.            Lessor
may relet the Demised Premises or any part or parts thereof, either in the name
of Lessor or otherwise, for a term or terms that may at Lessor’s option be less
than or exceed the period that would otherwise have constituted the balance of
the term of this Lease and may grant concessions or free rent without thereby
in any way affecting Lessee’s liability for the rental payable under this Lease
for the period of concession or free rent; and


 


C.            Lessee
shall also pay Lessor as liquidated damages for the failure of Lessee to
observe and perform Lessee’s


 


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covenants any deficiency between the rent reserved in this Lease and
the net amount, if any, of the rents collected by reason of the reletting of
the reletting of the Demised Premises for each month of the period that would
otherwise have constituted the balance of the term of this Lease.


 


(i)            In
computing liquidated damages there shall be added to the said deficiency
interest on the amount of said deficiency at the rate set forth in Paragraph
A of this Section 17.03 from the date of the default until payment
of the deficiency, together with any expenses that Lessor may incur in
connection with the recovery of possession of the Demised Premises and
reletting, such as, but not limited to, legal expenses, attorneys’ fees, or
brokerage, for keeping the Demised Premises in good order and for preparing the
same for reletting; and


 


(ii)           Any
such liquidated damages shall be paid in monthly installments by Lessee on the
rent day specified in this Lease and any suit brought to collect the amount of
the deficiency for any month shall not prejudice in any way the rights of
Lessor to collect the deficiency for any subsequent month by a similar action
or proceeding.


 


17.04       There
shall be paid to Lessor, as additional rent, interest computed at the rate
equal to two percent (2%) above the prime rate of interest described in Paragraph
17.03A upon the amount of rent or additional rent which is not paid on or
prior to the expiration of ten (10) days from the date such payment is due.
Such payment of additional rent under this Section 17.04 shall be
payable commencing upon the date following the expiration of such ten (10) day
period but shall accrue commencing as of the date payment of the rent or
additional rent was due (without regard to any applicable grace period) and
shall continue to accrue until payment is actually made to Lessor and credited
to Lessor’s account by Lessor’s bank and available for Lessor’s use.


 


17.05       Should
Lessee default (as defined in this Article 17), Lessor may thereupon
make any alterations and decorations in the Demised Premises that Lessor, in
its sole judgment, considers advisable and necessary for the purpose of
reletting the Demised Premises.  The
making of these alterations or decorations shall not operate or be construed to
release Lessee from any liability under this Article 17.


 


17.06       Lessor
shall in no event be liable and Lessee’s liability under this Article 17
shall not be affected or diminished in any way whatsoever for failure to relet
the Demised Premises, or if the Demised Premises are relet, for failure to
collect the rent thereof under such reletting.


 


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17.07       In
the event of a breach or threatened breach by Lessee of any of the covenants or
provisions of this Lease, Lessor shall have the right of injunction and the
right to invoke any  remedy allowed at law or in equity as if re-entry,
summary dispossess proceedings, or other remedies were not provided in this
Lease. Mention in this Lease of any particular remedy shall not preclude Lessor
from any other remedy, in law or in equity.


 


17.08       If
Lessor shall enter into and repossess the Demised  Premises because
Lessee defaults in the performance of any of the terms of this Lease, Lessee
will not claim the right to redeem or re-enter the Demised Premises or restore
the operation of this Lease, and Lessee waives the right to such redemption and
re-entrance under any present or future law, and waives the right of any party
claiming through or under Lessee to make payment of any sum or sums of
rent, or otherwise, of which Lessee shall have made default under any of the
covenants of this Lease, and to claim any subrogation to the rights of Lessee under this Lease, by reason
of that payment.


 


17.09       Any
action taken by Lessor under this Article 17  shall not waive any
right that Lessor would otherwise have against Lessee for rent reserved in this
Lease or otherwise, and Lessee shall remain responsible to Lessor for any loss and
damage suffered by Lessor by reason of Lessee’s default or breach. The words “re-enter”
and “re-entry” as used in this Lease are not restricted to their technical
legal meanings.


 


ARTICLE 18


 


NO REINSTATEMENT


 


18.01       A.            No
receipt of monies by the Lessor from the Lessee after the lawful termination or
cancellation of this Lease, shall reinstate, continue or extend the term of this
Lease, or affect any notice theretofore given to the Lessee, or waive the Lessor’s right to enforce
the payment of net rent or additional rent or rents then due, or thereafter falling
due, or waive the Lessor’s right to recover possession of the Demised Premises by proper suit,
action, proceeding, or remedy;


 


B.            After
the service of notice to terminate or  cancel this Lease, or the commencement of
suit, action, or summary proceedings,
or any other remedy, or after a final order or judgment for the possession of the Demised
Premises, the Lessor may demand, receive and collect any monies due, or thereafter
falling due, without in any manner affecting the notice, proceeding, suit,
action, order, or judgment. All such monies collected shall be


 


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deemed to be payments on account of the use and occupation or the
Lessee’s liability under this Lease.


 


18.02       The
Lessor’s failure to enforce any term of this Lease that is breached by the
Lessee, after notice had, shall not be deemed to void or affect the right of
the Lessor to enforce that term on the occasion of a subsequent default or
breach.


 


ARTICLE 19


 


SUBORDINATION;
CONDOMINIUM DECLARATION


 


19.01       All
Fee Mortgages (as defined in Section 29.04) that may now or hereafter
affect the Lessor’s interest in the Demised Premises, and all renewals,
modifications, consolidations, replacements, and extensions thereof, shall be
subject and subordinate to (i) this Lease and any amendment, renewal, or
modification of this Lease and (ii) any Leasehold Mortgage, as defined in Section
15.01 and any amendment, renewal, modification or refinancing thereof
provided, however, that the foregoing subordination shall only apply to Fee
Mortgages as to which the subordination described in Section 19.02 is
inapplicable.  This clause shall be
self-operative and no further instruments of subordination shall be
required.  In confirmation of this
subordination Lessee shall execute promptly any certificate that Lessor may
request.  Lessee constitutes and appoints
Lessor the Lessee’s attorney-in-fact to execute any such certificate or certificates
for and on behalf of the Lessee.


 


19.02       If
a prospective Fee Mortgagee requests that a Leasehold Mortgagee subordinate its
interest in the Demised Premises to a Fee Mortgage, the provisions of Section
15.03 shall apply.


 


19.03       A.            The subordination described in Section
19.02 as it pertains to Fee Mortgages is conditioned upon the agreement of
the Fee Mortgagee, to be delivered by it to Lessee, in which the Fee Mortgagee
agrees in substance that so long as Lessee or its successors and assigns is not
in default (as defined in Article 17):


 


i.              Lessee
will not be disturbed in its possession of the Demised Premises, or its rights
therein pursuant to the terms of this Lease, including, without limitation, the
provisions of Article 31; it being expressly understood that the Lessee
shall be entitled to acquire the Demised Premises pursuant to Article 31
free and clear of the lien of the Fee Mortgage;


 


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ii.             Lessee
will not be joined in any action or proceeding to foreclose the mortgage by the
holder thereof; and


 


iii.            Casualty
insurance proceeds and condemnation  awards to which the holder of the mortgage is
entitled under the terms of the mortgage will be applied towards restoration of
the Demised Premises consistent with Articles 11 and 13 of this Lease,
respectively, and be disbursed as provided for by those Articles;


 


iv.            the
agreement shall inure to the benefit of  the Lessee and its successors and assigns,
including a Leasehold Mortgagee.


 


B.            The
giving of any agreement as described in  Paragraph 19.03A by the mortgagee
may be conditioned by it on the reciprocal agreement by the Lessee to attorn to the
holder of the mortgage should it become vested with the Lessor’s interest in the Demised Premises.


 


19.04       This
Lease and the obligations of the parties  hereunder are subject to the provisions of
the Condominium Declaration and
the By-Laws and Rules and Regulations of the Condominium now in effect or duly adopted, as
the same may be amended from
time to time, including, without limitation, the following provisions of Article
TWELFTH of the Condominium Declaration:


 


“The mere act of occupancy of any of said Units
shall  signify that the provisions of this Declaration and the By-Laws and Rules
and Regulations of the Condominium are accepted and ratified, and all of such
provisions shall be deemed and taken to be covenants running with the land and
shall bind any person having at any time any interest or estate in such
Unit, as though such provisions were recited and stipulated at length in each and
every deed, conveyance or lease thereof.”


 


ARTICLE 20


 


QUIET ENJOYMENT


 


20.01       The
Lessee, upon paying the rent and performing its  other obligations
under this Lease shall and may, at all times during the term of this Lease peaceably and
quietly have, hold, and enjoy the said Demised Premises free of molestation
by the Lessor and by any party claiming by or through Lessor, or claiming rights
paramount to the Lessee pursuant to this Lease.


 


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20.02       The
covenants and agreements contained in this Lease inure to the benefit of and
are binding upon the parties to this Lease, their successors and assigns, but
this Article does not modify the provisions governing assignment, as elsewhere
provided for in this Lease.


 


ARTICLE 21


 


NOTICES


 


21.01       A.            All notices, consents, approvals and
other communications required or permitted to be given to the parties hereunder
shall be in writing and addressed to them at the respective addresses first
given for them in this Lease, or to such other address, of which either of
them, as the case may be, shall notify the other in the manner stated in this Article
21 for giving notice.


 


B.            The
notice must be given by either registered mail or by certified mail. In the
case of the former the service of the notice shall be deemed complete three (3)
days after the registration thereof with the postal authorities, and in the
case of the latter three (3) days after the due mailing thereof. However, if in
either case the notice is mailed from a place outside of New York State,
service shall not be complete until the notice is received.


 


ARTICLE 22


 


NO WAIVER


 


22.01       The
failure of the Lessor or Lessee to insist in anyone or more instances, upon a
strict performance of any of the covenants of this Lease, or to exercise any
option contained in this Lease, shall not be construed as a waiver of or
relinquishment for the future of the performance of that covenant, or the right
to exercise that option, but the same shall continue and remain in full force
and effect.  The Lessor’s receipt of net
rent or additional rent, with knowledge of the breach of any covenant of this
Lease, shall not be deemed a waiver of that breach.  No waiver by the Lessor or Lessee of any
provision of this Lease shall be deemed to have been made unless expressed in
writing and signed by the party against whom enforcement of the waiver is
sought.


 


22.02       The
Lessor’s receipt of any installment of the net rent under this Lease or of any
additional rent shall not be a


 


48





















 


waiver
of any net rent or additional rent then due. Lessor may, in its sole
discretion, apply any payments made by Lessee to the satisfaction of any debt
or obligation of Lessee to Lessor under this Lease, regardless of Lessee’s
instructions as to the application of those payments, whether those
instructions are endorsed on Lessee’s check or otherwise.


 


ARTICLE 23


 


REMEDIES CUMULATIVE


 


23.01       All
the rights and remedies given to the Lessor in this Lease for the recovery of
the Demised Premises because of the default by the Lessee in the payment of any
sums that may be payable pursuant to the terms of this Lease, or upon the
breach of any of the terms of this Lease, or the right to re-enter and take
possession of the Demised Premises upon the happening of any of the defaults or
breaches of any of the covenants of this Lease, or the right to maintain any
action for rent or damages and all other rights and remedies allowed at law or
in equity, are reserved and conferred upon the Lessor as distinct, separate,
and cumulative remedies, and no one of them, whether exercised by the Lessor or
not, shall be deemed to be in exclusion of any of the others.


 


ARTICLE 24


 


REPRESENTATIONS AND WARRANTIES


 


24.01       The
Demised Premises will be delivered by Lessor at the commencement of the term of
this Lease in their “as is” condition. 
The Lessor makes no representations or warranties concerning the
physical condition of the Demised Premises, or any of the mechanical, electrical,
or heating, ventilation and air conditioning systems or furniture, fixtures and
equipment located at the Demised Premises, all of which Lessee agrees to accept
“as is” at the Commencement Date of this Lease.


 


24.02       The
Lessor and Lessee shall each pay when due one half of any transfer taxes
imposed upon creation of this Lease and payable by the Lessor and the parties
shall each indemnify the other against any claim for such taxes and hold each
other harmless from any damage cost or expense arising out of each party’s
failure to pay such taxes.  Lessee will
pay each payment required of Lessee hereunder to the Lessor as additional rent
under this Lease.  Such


 


49





















 


payments of additional rent shall be made to the extent due to the
taxing authority not later than ten (10) days prior to the date the payment or
any installment thereof is due. The Lessor and Lessee shall execute any forms
required in connection with the New York State Real Estate Transfer Tax or in
connection with the New York City Real Property Transfer Tax.


 


24.03       The
Lessor shall have no obligation to correct any condition which constitutes a
violation of any law, order, regulation, rule, ordinance or requirement of any
Federal, State, County, municipal or other governmental or quasi-governmental
department, agency or authority relating to the Demised Premises of any kind or
nature, whether now in existence or hereafter occurring and whether or not
notice of the same has been issued by any such governmental unit to lessor or
otherwise.


 


24.04       Lessor
represents to Lessee that Lessor is not a “foreign person” (as defined in Code Section
1445, as amended, and the regulations promulgated thereunder) and Lessor
has delivered to Lessee an affidavit in connection therewith concurrently with
the execution of this Lease.


 


24.05       The
Lessor, in compliance with Section 13 of the Lien Law, covenants that
the Lessor will receive the rent and other payments made to it under this Lease
and will hold the right to receive such payments as a trust fund to be applied
first for the purpose of paying the costs of the improvement constituting part
of the Demised Premises and will apply the same first to the payment of the
cost of the improvement before using any part of the total of the same for any
other purpose.


 


24.06       Lessee
hereby covenants, warrants and represents to Lessor that it has dealt with no
brokers, finders or like persons in connection with this Lease, and that no
conversations or prior negotiations were had with any broker, finder or like
person or firm concerning the Demised Premises, and to indemnify, defend and
hold harmless the Lessor from and against any and all loss, cost, liability and
expense including, without limitation, reasonable attorney’s fees and
disbursements, which may be suffered or incurred by reason of any of the
foregoing covenants, warranties or representations being untrue or being
claimed to be untrue by any person or firm.


 


24.07       Lessor
represents and warrants to Lessee that as of 11:59 p.m. on November 30, 1997,
(i) there are no leases (other than the EBC Lease) licenses, or parties with
any rights of possession through Lessor and (ii) Lessor owns legal and
beneficial fee title to the Demised Premises, free and clear of all liens and
encumbrances incurred by Lessor, its agents and affiliates, except for the
Declaration, the EBC Lease and the other matters shown in


 


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Chicago
Title Insurance Company Report - TA #97 (01) (451), dated June 11, 1997.


 


ARTICLE 25


 


NO OTHER
REPRESENTATIONS; LIABILITY


 


25.01       Lessee acknowledges that:


 


A.            By
virtue of a certain Assignment and Assumption of Lease dated as of November 30,
1997 by and between Educational Broadcasting Corporation (“EBC”), as assignor,
and Lessee hereunder, as assignee, EBC assigned to Lessee that certain Lease
dated the 11th day of August, 1988 between Lessor hereunder, as Lessor
thereunder, and EBC as Lessee covering substantially the same premises as the
Demised Premises (the “EBC Lease”) and Lessee assumed and agreed to fully and
punctually pay, perform and observe all of the terms, covenants, conditions and
obligations of, or arising under, the EBC lease on the part of EBC to be paid,
performed and observed.


 


B.            Lessor
and Lessee are party to a certain Consent to Assignment of Lease and Agreement
dated as of August 21, 1997 pursuant to which, inter alia,
Lessor consented to the assignment to and assumption by Lessee of the EBC Lease
and Lessor and Lessee agreed to restate the EBC Lease in its entirety as of the
effective date of the assignment.


 


C.            This
Lease is the restatement of the EBC Lease contemplated by the Consent to
Assignment of Lease and Agreement.


 


D.            Lessee
shall look solely to EBC (as assignor of the EBC Lease and/or as subtenant of
Lessee) to obtain possession of the Demised Premises and the continued
occupancy of the Demised Premises by EBC on any other person, firm or
corporation shall not constitute a failure by Lessor to deliver possession of
the Demised Premises to Lessee at the beginning of the term or otherwise.  This paragraph shall constitute an “express
provision to the contrary” within the meaning of Real Property Law Section
223-a.


 


25.02       The
Lessee is fully familiar with the physical condition of the Demised Premises,
and Lessee takes the Demised Premises in their “as is” condition.  The Lessor has made no representations
whatsoever in connection with the conditions at or of the Demised Premises
except those expressly set forth in this Lease. 
The Lessor shall not be liable for any latent or patent defects in the
Demised Premises.


 


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25.03       Lessee
agrees that the liability of Lessor under this Lease and all matters pertaining
to or arising out the tenancy and the use and occupancy of the Demised
Premises, shall be limited to Lessor’s interest in the Tenth Floor Unit and the
proceeds there from and in no event shall Lessee make any claim against or seek
to impose any personal liability upon the individual who is or may hereafter
become the Lessor or upon any general or limited partner of any partnership
that may hereafter become the Landlord, or any principal of any firm or
corporation that may hereafter become the Lessor, but nothing herein contained
shall prohibit Lessee from commencing an action against the Lessor with respect
to any matter arising under this Lease.


 


ARTICLE 26


 


ENTIRE AGREEMENT


 


26.01       This
Lease contains the entire agreement between the parties, and any agreement
hereafter made shall not operate to change, modify, or discharge this Lease in
whole or in part unless that agreement is in writing and signed by the party
sought to be charged with it.


 


ARTICLE 27


 


ESTOPPEL
CERTIFICATES


 


27.01       The
Lessee agrees at any time and from time to time upon not less than ten (10)
days prior written request by the Lessor or a Fee Mortgagee, to execute,
acknowledge, and deliver to Lessor or such Fee Mortgagee a statement in writing
certifying that this Lease is unmodified and in full force and effect (or if there
have been modifications that the same is in full force and effect as modified
and stating the modifications), and the dates to which the rent and other
charges have been paid in advance, if any, and whether or not, to the best
knowledge of the signer of such statement, there are any then existing defaults
on the part of either Lessor or Lessee in the performance of the terms,
covenants and conditions of this Lease, and if so, specifying the default of
which the signer of such statement has knowledge; it being intended that any
such statement delivered pursuant to this Section 27.01 may be relied
upon by prospective purchasers of Lessor’s interest or mortgagees of Lessor’s
interest in the Demised Premises.


 


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27.02       The
Lessor agrees at any time and from time to time upon not less than ten (10)
days prior written request by the Lessee, or by a Leasehold Mortgagee giving
the notice described in  Paragraph 15.01 of this Lease, to execute, acknowledge, and
deliver to Lessee or such Leasehold Mortgagee a statement in writing certifying
that this Lease is unmodified and in full force and effect (or if there have
been modifications that the same is in full force and effect as modified and
stating the modifications), and the dates to which the rent and other charges
have been paid in advance, if any, and whether or not, to the best knowledge of the signer
of such statement, there are any then existing defaults on the part of either
Lessor or Lessee in the performance of the terms, covenants and conditions of
this Lease, and if so, specifying the default of which the signer of such
statement has knowledge; and if the request is made by a Leasehold Mortgage giving the notice
described in Paragraph 15.01 of this Lease such other information
with respect to this Lease as such Leasehold Mortgagee shall reasonably
request; it being intended that any such statement delivered pursuant to this Section
27.02 may be relied upon by prospective mortgagees of Lessee’s interest in
the Demised Premises and other lenders, by assignees of the Lessee’s interestin this Lease
and by sublessees of all or substantially all of the Demised Premises.


 


ARTICLE 28


 


NON-MERGER


 


If the Lessee acquires title to the Demised
Premises, this Lease shall not merge into the fee interest so acquired.


 


ARTICLE 29


 


CERTAIN DEFINITIONS


 


29.01       The
tern “Lessor” as used in this Lease means only the owner of the current
interest of the Lessor in the Demised Premises or, as the case may be, the
successor thereto from time to time. In the event of any transfer at any time
of the interest of the Lessor (other than to the Lessee pursuant to the
Contract of Sale described in Section 31.04) the transferor shall be and
is entirely freed and relieved of all covenants and obligations of the Lessor
under this Lease, and it shall be deemed and construed without further
agreement between the parties or their respective successors in interest or
between the parties and the transferee


 


53





















 


that the transferee of the Lessor’s interest, subject to Section
25.03 of this Lease, has assumed and agreed to carry out any and all
covenants and obligations of the Lessor under this Lease, including those
arising prior to the transfer.


 


29.02       The
tern “Institutional Mortgagee” means any one of the following: a bank; trust
company; insurance company; investment bank or affiliate of an investment bank
or loan originator on behalf of an investment bank acting solely as a conduit
for a lender which otherwise meets the definition of an Institutional
Mortgagee; or real estate investment fund which is licensed by the State of New
York to conduct and is in the business of making mortgage loans and which has
assets over $100,000,000.00; any pension, retirement or welfare fund or other
non-profit organization where the investment policy and financial condition of
that fund or organization is subject to the supervision of the state agency, in
the State where the Demised Premises are situate, that has supervision of banks
or, as the case may be, supervision of insurance companies.


 


29.03       An
“Institutional Mortgage” is a mortgage held by an
Institutional Mortgagee.


 


29.04       A
“Fee Mortgage” is a mortgage, deed of trust, deed to secure debt, or other
security instrument by which the Lessor’s fee interest in the Tenth Floor Unit
is mortgaged, conveyed, assigned or otherwise transferred to secure a debt or
other obligation.


 


29.05       A
“Fee Mortgagee” is an Institutional Mortgagee holding a Fee Mortgage.


 


29.06       An
“Affiliate”  is any person, corporation,
partnership, limited liability company, joint venture or other entity (an “Entity”)
directly or indirectly controlling or controlled by or under direct or indirect
common control with another.  For
purposes of defining Affiliate, the term “control” means the power to direct
the management and policies of such Entity, directly or indirectly, whether
through the ownership of voting securities or other beneficial interest, by
contract or otherwise.


 


ARTICLE 30


 


OTHER UNIT OWNERS’
RIGHT OF FIRST REFUSAL;


COMMENCEMENT DATE
OF LEASE


 


54





















 


30.01       Lessee
warrants and represents to Lessor that (i) it is the owner of the Modified
Hotel Unit, that Henry Hudson Holdings LLC, its wholly owned subsidiary, is the
owner of the EBC Unit of  the Condominium, and that Lessee intends to convey
title to the Modified Hotel Unit of the Condominium to Henry Hudson Holdings LLC.
Lessee hereby waives any right it may have as the owner of the Modified Hotel
Unit to elect to enter into this Lease in accordance with Section 10(a)
of Article XI, or any other provision of the By-Laws of the Condominium;
and (ii) Henry Hudson Holdings LLC has fully and irrevocably waived any right it
now has or may in the future have as owner of the EBC Unit or the Modified Hotel Unit to
elect to enter into this Lease in accordance with such By-Laws.


 


ARTICLE 31


 


OPTION TO PURCHASE
DEMISED PREMISES


 


31.01       The
Lessee is hereby given the option to purchase the Demised Premises and the
unused development rights, if any, relating to the Tenth Floor Unit reserved by
Lessor in the Declaration upon the terms and conditions set forth in this
Article 31 and in the Contract of Sale referred to herein (the “Option”).


 


31.02       Provided
that this Lease is, at the time of the exercise of the Option, in full force
and effect and that together with or prior to the exercise of the Option Lessee
pays to Lessor all net rent and additional rent then due and unpaid and fully
cures all of the then outstanding monetary defaults under this Lease, if any,
Lessee may exercise the Option by giving written notice to Lessor at any time
from and after December 1, 2015 (the “Threshold Date”), at a price equal
to the then fair market value thereof. Irving Schatz hereby waives any right of
first refusal with respect to the Option and the purchase contemplated thereby
which he has on the date of this Lease. At the request of Lessee made at any
time on or after the date which is six (6) months prior to the Threshold Date
and prior to an exercise of the Option by Lessee under Section 31.03 of
this Lease, Lessee and Lessor shall in good faith negotiate as to the fair
market value of the Tenth Floor Unit. 
Lessor shall, on request, furnish to Lessee the name and address of
Lessor’s attorney.  In the event that
Lessor and Lessee are unable to so agree on the fair market value of the Tenth
Floor Unit within thirty (30) days after the date of Lessee’s request for a
determination thereof, Lessor and Lessee shall each choose a disinterested and
independent appraiser, and the two appraisers shall mutually agree upon the
fair market value.  Each appraiser chosen
shall have not less than ten (10) years experience


 


55





















 


in the appraisal of commercial real estate in the Borough of Manhattan.
Lessor or Lessee, as the case may be, shall deliver a written notice to the
other party appointing its appraiser within fifteen (15) business days after
receipt from the other party of a written notice appointing the party’s
appraiser. If, within fifteen (15) business days after appointment of the two
appraisers as described above, the two appraisers are unable to agree upon the
fair market value of the Tenth Floor Unit, a third disinterested and independent
appraiser having the qualifications described in this Paragraph shall be chosen
within five (5) business days thereafter by mutual consent of such first two
appraisers, of if such first two appraisers fail to agree upon the appointment
of a third appraiser, such appointment shall be made by an authorized
representative of the American Arbitration Association or any organization
successor thereto (the “AAA”), or, if there be none, by the Supreme
Court of the State of New York. In the event a third appraiser is so appointed,
fair market value shall be determined by a majority of the appraisers so
appointed within thirty (30) days after selection of the third appraiser. The
three appraisers shall accord the parties an opportunity to present documentary
evidence and expert oral testimony and to have the right to cross-examination.
The process shall be administered by and in accordance with the rules of the
AAA in the City, County and State of New York. The fair market value as so
determined by such appraisers shall be binding and conclusive upon Lessor and
Lessee for a period of six (6) months following the date of such determination
(the “Option Period”) and shall apply in the event of any subsequent exercise
of the purchase Option made by Lessee during such six (6) month Option Period.
In the event that Lessee does not exercise the purchase Option during such six
(6) month Option Period, then the fair market value of the Tenth Floor Unit
shall again be determined in accordance with the provisions hereof for any
subsequent exercise of the Option. Lessor and Lessee shall pay the fees and
expenses of the respective appraisers appointed by them and shall share equally
the fees and expenses of the third appraiser, if any, and any fees imposed upon
either by the AAA. Time shall be of the essence with respect to the Lessee’s
obligations under this Section 31.02 and Section 31.03 below.


 


31.03       The
election of the Lessee to exercise the Option shall be made during the Option
Period by (a) a notice in writing given to the Lessor in accordance with Article
21 of this Lease (the “Exercise Notice”), accompanied by (b) a deposit in
an amount equal to ten (10%) percent of the fair market value determined in
accordance with Section 31.02 of this Lease payable to the order of the
attorney for Lessor who is duly licensed to practice law in the State of New
York or other mutually satisfactory escrow agent and (c) such other amounts, if
any, as shall be required pursuant to Section 31.02.  The Exercise Notice shall set forth a date
(the “Closing Date”) for
the closing of title to the Demised Premises (the “Closing”) which shall be the
earlier to occur of (i) the


 


56





















 


atmosphere,
ground, sewer system or any body of water, if such material (as determined by
any governmental authority) does or may, pollute or contaminate the same, or
may adversely affect (i) the  health, welfare or safety of persons, whether
located on the Demised Premises or elsewhere, or (ii) the condition, use or
equipment of the Demised Premises or any other real or personal property.


 


34.04       As
used herein, the term “Hazardous Material” shall  be deemed to
include any hazardous, toxic or harmful substances, wastes, materials,
pollutants or contaminants (including, without limitation, asbestos,
polychlorinated biphenyls, petroleum products, flammable explosives,
radioactive materials, infectious substances or raw materials which include
hazardous constituents), or any other substances or materials which are
included under or regulated by “Environmental Laws.” As used herein, “Environmental Laws”
shall be deemed to mean any and all local, state or federal laws, ordinances,
rules or regulations of any governmental authority regarding the use, control,
regulation or prohibition of any Hazardous Material or otherwise pertaining to
environmental regulation, contamination or clean-up, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act
of 1980 (42 U.S.C. Section 9601 et seq. and CRF Section 302.1 et seq.), the
Resource Conservation and Recovery Act of 1976 (42 U.S.C. Section 6901 et
seq.), the Federal Water Pollution Control Act (33 U.S.C. Section 1251 et seq.
and 40 CRF Section 116.1 et seq.) and the Hazardous Materials TransportationAct (49
U.S.C. Section 1801 et seq.) and the regulations promulgated pursuant to said laws.


 


34.05       Lessee
hereby agrees that it shall be fully liable  for all costs and
expenses directly or indirectly related to (i) the use, storage and disposal of Hazardous
Material kept on the Premises by the Lessee, (ii) compliance with all Environmental Laws, and (iii) the
remediation of any and all Hazardous Materials affecting the Demised Premises at any time
hereafter, to the extent that such Hazardous Materials were stored, used and/or
permitted at, on or about the Demised Premises at any time by Lessee, its
employees, agents, contractors, affiliates, any subtenant and/or assignee.
Lessee shall give immediate notice to the Lessor of any violation or potential violation
of the provisions of this Article 34 and of the receipt of any notice from any
governmental entity or agency asserting that any violation of any Environmental
Laws has occurred in, at or about the Demised Premises, shall immediately
provide to Lessor copies of any order, notice, permit, application or any other
communication from or to any entity or person, including, without limitation,
any governmental agencies regarding the environmental condition of the Demised
Premises and shall defend, indemnify and hold harmless Lessor, its mortgagee, and its
and their respective agents, officers, directors, partners and shareholders,
from and against any claims, loss, judgments,


 


59





















 


demands,
penalties, fines, liabilities, settlements, damages, costs, or expenses
(including, without limitation, attorney and consultant fees, court costs and
litigation expenses) of whatever kind or nature, known or unknown, contingent
or otherwise, arising out of or in any way related to (i) the presence,
disposal, release, or threatened release of any such Hazardous Material in or
upon the soil, water, vegetation, buildings, personal property, persons,
animals, or otherwise at any time occurring as hereinabove provided in this Article
34; (ii) any personal injury (including wrongful death) or property damage
(real or personal) arising out of or related to such Hazardous Material; (iii)
any lawsuit brought or threatened, settlement reached or government order
relating to such Hazardous Material; and/or (iv) any violation of any laws
applicable thereto. The provisions of this Article 34 shall be in addition to
any other obligations and liabilities Lessee may have to Lessor in law, equity,
or otherwise and shall survive the termination of this Lease.


 


IN WITNESS WHEREOF, the parties have executed this
Lease as of the day and year first above written.


 


 


	
  ATTEST:

  	
      /s/ Irving Schatz

  	
   

  
	
   

  	
  Irving
  Schatz, Lessor

  
	
   

  	
   

  
	
   

  	
  IAN
  SCHRAGER HOTELS LLC, Lessee

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
  /s/

  	
   

  
							



 


60





















 


	
  STATE OF

  	
  Florida

  	
  )

  	
   

  
	
   

  	
   

  	
  )

  	
  ss.: Boca
  Raton

  
	
  COUNTY
  OF

  	
  Palm Beach

  	
  )

  	
   

  



 


On the 11 day of February in the year 1999, before me, the undersigned, a Notary Public in and
for said State, personally appeared IRVING SCHATZ, personally known to me and
proved to me on the basis of satisfactory evidence to be the individual(s)
whose name(s) is (are) subscribed to the within instrument and acknowledged to
me that he/she/they executed the same in his/her/their capacity(ies), and that
by his/her/their signature(s) on the instrument, the individual(s), or the person
upon behalf of which the individual(s)  acted, executed the instrument.


 


	
  [SEAL]

  	
   

  	
  /s/ Greg
  Whitworth

  	
   

  
	
   

  	
   

  	
  NOTARY PUBLIC

  	
   

  



 


	
  STATE OF

  	
  New York

  	
  )

  	
   

  
	
   

  	
   

  	
  )

  	
  ss.:

  
	
  COUNTY
  OF

  	
  New
  York

  	
  )

  	
   

  



 


On the 11th day of February in the year 1999, before me, the
undersigned, a Notary Public in and for said state, personally appeared Peter W.
Ani, personally known to me and proved to me on the basis of satisfactory evidence
to be the individual(s) whose names(s) is (are) subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in
his/her/their capacity(ies), and that by his/her/their signature(s) on the
instrument, the individual(s), or the person upon behalf of which the
individual(s) acted, executed the instrument.


 


	
   

  	
   

  	
  /s/ Beatrice
  Williams

  	
   

  
	
   

  	
   

  	
  NOTARY PUBLIC

  	
   

  
	
   

  	
   

  	
  [SEAL]

  	
   

  



 


61





















 


 


EXHIBIT “A”

to Net Lease between Irving Schatz and Ian Schrager Hotels LLC


 


Legal
description of the premises within which the Tenth Floor Unit is located.


 


[ANNEXED]


 


62





















 


SCHEDULE A


 


 


ALL that certain plot, piece or parcel of land,
situate, lying and being in the Borough of Manhattan, City, County and State of
New York, bounded and described as follows:


 


BEGINNING
at a point on the northerly side of 57th Street distant 20 feet easterly from
the corner formed by the intersection of the easterly side of 9th Avenue with
the northerly side of 57th Street;


 


RUNNING
THENCE easterly along the said northerly side of 57th Street, 155 feet;


 


THENCE
northerly, parallel with 9th Avenue 200 feet 10 inches to the southerly side of
58th Street;


 


THENCE
westerly along the said southerly side of 58th Street 135 feet to a point
distant 40 feet easterly from the corner formed by the intersection of the
southerly side of 58th Street with the easterly side of 9th Avenue;


 


THENCE
southerly parallel with 9th Avenue and part of the distance through a party
wall 100 feet 10 inches;


 


THENCE
westerly parallel more or less with 58th Street 20 feet;


 


THENCE
southerly and part of the way through another party wall 100 feet to the
northerly side of 57th Street, the point or place of BEGINNING.


 





















 


Exhibit 10.07 to Net Lease between


Irving Schatz and Ian Shrager Hotels LLC


 


Form of Letter
of Credit


 


	
   

  	
  Issue Date:

  	
   

  	
   

  
	
   

  	
  Letter of
  Credit Number:

  	
   

  
	
   

  	
   

  
	
  Name and

  	
   

  
	
  Address of
  Issuing Bank

  	
   

  
	
  New York,
  New York       .

  	
   

  
	
   

  	
   

  
	
   

  	
  Applicant:

  
	
   

  	
   

  
	
   

  	
  [Name and
  Address of Lessee]

  
	
   

  	
   

  
	
  Beneficiary:

  	
   

  
	
   

  	
   

  
	
   

  	
  [Name and
  address of Lessor]

  	
   

  
	
   

  	
  Amount; USD
  [Security required by the Lease]

  
						



 


We hereby
establish our irrevocable letter of credit in your favor, drafts to be marked “Drawn
under
                    
Bank, Letter of Credit Number
                      .”


 


Date and Place of Expiry:
                            ,
           , in New
York, New York.


 


CREDIT AVAILABLE WITH: ANY BANK
BY: Negotiation of your draft(s) at sight drawn on
                         
Bank, New York


 


Drafts to be
executed by [Name of the Lessor] or, if an individual, his executor,
administrator or attorney-in-fact (if such attorney-in-fact is a practicing
lawyer in New York, New York and a member of the New York bar in good
standing), or if a partnership, its general partner, or if a corporation, its
chairman, president or vice-president, drawn at sight on
                                
[Bank] and payable
under this Letter of Credit, to the
order of the Security Deposit Escrow Agent identified in the certificate
described below, and to be accompanied by a certificate signed and sworn to by
(Name of the Lessor) or, if an individual, his executor, administrator or
attorney-in-fact (if such attorney-in-fact is a practicing lawyer in New York,
New York and a member of the New York bar in good standing), or if a
partnership, its general partner, or if a corporation, its chairman, president
or vice-president stating:


 


63





















 


“The Lessor under the Net Lease dated as of February
11,  1999 between Irving Schatz and Ian Shrager Hotels LLC Corporation is
entitled to draw $
              
payable to the order of [name of Security Deposit Escrow Agent] under the Letter of
Credit No.            issued
by 
                          
[Bank]
pursuant to Section       of the Net Lease.”


 


This Letter of Credit shall be extended for
successive  periods of one year from the present expiration date and any future expiration
date.  If thirty (30) days prior to each
annual expiration
date the Lessor under the Net Lease has not received from us written
notice that this Letter of Credit has been extended for an additional one year period,
the full amount available under this Letter of Credit may be drawn at sight on us payable to the
order of the Security Deposit Escrow Agent identified in the certificate described in
the first paragraph of this Letter of Credit, by a draft executed as
provided in the first paragraph accompanied by the certificate described in the first paragraph of
this Letter of Credit.


 


This credit is subject to the Uniform Customs and
Practice for Documentary Credits (1983 Revision) International Chamber of
Commerce Publication No. 400.


 


The amount of each draft negotiated, with the date
of  negotiation, must be endorsed hereon by the negotiating bank.  We hereby agree with you that drafts drawn under
and in compliance with the terms of this Letter of Credit will be duly honored in presentation to us,
if negotiated, or if presented to this office [                          
(address)] together with this Letter of Credit on or before the expiry date or any
subsequent date set forth above to which this Letter of Credit is extended.


 


 


	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized
  Signature

  



 


The foregoing form may be varied to reflect the
practices  and requirements of the issuing bank, provided such variations do not impair the
practical realization by the Lessor of the rights and benefits
intended to be conferred upon it by the foregoing form.


 





















 


EXHIBIT 31.04

to Net Lease between Irving Schatz and Ian Schrager Hotels LLC


 


 


Option
contract of sale.


 


[ANNEXED]


 


 


64