Document:

Exhibit-10.4.1

 

LEASE

 

between

 

BFP ONE LIBERTY PLAZA CO. LLC,

 

Landlord

 

 

and

 

 

ARCH INSURANCE COMPANY,

 

Tenant

 

 

September 26, 2002

 

 

PREMISES:

 

One Liberty Plaza

New York, New York

The Entire Fifty-Third (53rd) Floor

 

 

TABLE OF
CONTENTS

 

	
  ARTICLE 1

  	
  Term and Fixed Rent

  
	
   

  	
   

  
	
  ARTICLE 2

  	
  Delivery and Use of Premises

  
	
   

  	
   

  
	
  ARTICLE 3

  	
  Escalations

  
	
   

  	
   

  
	
  ARTICLE 4

  	
  Security

  
	
   

  	
   

  
	
  ARTICLE 5

  	
  Subordination, Notice to Superior Lessors
  and Mortgagees

  
	
   

  	
   

  
	
  ARTICLE 6

  	
  Quiet Enjoyment

  
	
   

  	
   

  
	
  ARTICLE 7

  	
  Assignment, Subletting and Mortgaging

  
	
   

  	
   

  
	
  ARTICLE 8

  	
  Compliance with Laws

  
	
   

  	
   

  
	
  ARTICLE 9

  	
  Insurance

  
	
   

  	
   

  
	
  ARTICLE 10

  	
  Rules and Regulations

  
	
   

  	
   

  
	
  ARTICLE 11

  	
  Alterations

  
	
   

  	
   

  
	
  ARTICLE 12

  	
  Landlord’s and Tenant’s Property

  
	
   

  	
   

  
	
  ARTICLE 13

  	
  Repairs and Maintenance

  
	
   

  	
   

  
	
  ARTICLE 14

  	
  Electricity

  
	
   

  	
   

  
	
  ARTICLE 15

  	
  Landlord’ s Services

  
	
   

  	
   

  
	
  ARTICLE 16

  	
  Access and Name of Building

  
	
   

  	
   

  
	
  ARTICLE 17

  	
  Notice of Occurrences

  
	
   

  	
   

  
	
  ARTICLE 18

  	
  Non-Liability and Indemnification

  
	
   

  	
   

  
	
  ARTICLE 19

  	
  Damage or Destruction

  

 

i

 

	
  ARTICLE 20

  	
  Eminent Domain

  
	
   

  	
   

  
	
  ARTICLE 21

  	
  Surrender

  
	
   

  	
   

  
	
  ARTICLE 22

  	
  Conditions of Limitation

  
	
   

  	
   

  
	
  ARTICLE 23

  	
  Reentry by Landlord

  
	
   

  	
   

  
	
  ARTICLE 24

  	
  Damages

  
	
   

  	
   

  
	
  ARTICLE 25

  	
  Affirmative Waivers

  
	
   

  	
   

  
	
  ARTICLE 26

  	
  No Waivers

  
	
   

  	
   

  
	
  ARTICLE 27

  	
  Curing Defaults

  
	
   

  	
   

  
	
  ARTICLE 28

  	
  Broker

  
	
   

  	
   

  
	
  ARTICLE 29

  	
  Notices

  
	
   

  	
   

  
	
  ARTICLE 30

  	
  Estoppel Certificates

  
	
   

  	
   

  
	
  ARTICLE 31

  	
  Memorandum of Lease

  
	
   

  	
   

  
	
  ARTICLE 32

  	
  No Representations by Landlord

  
	
   

  	
   

  
	
  ARTICLE 33

  	
  Arbitration

  
	
   

  	
   

  
	
  ARTICLE 34

  	
  Holdover

  
	
   

  	
   

  
	
  ARTICLE 35

  	
  Miscellaneous Provisions and Definitions

  

 

ii

 

	
  ARTICLE 36

  	
  Extension
  of Term

  
	
   

  	
   

  
	
  ARTICLE 37

  	
  The Lower Manhattan Plan

  
	
   

  	
   

  
	
  ARTICLE 38

  	
  Layout
  and Finish

  
	
   

  	
   

  
	
  ARTICLE 39

  	
  Condominium

  
	
   

  	
   

  
	
  ARTICLE
  40  

  	
  Tenant’s Antenna

  

 

iii

 

LEASE, dated
September 26, 2002, between BFP ONE LIBERTY PLAZA CO. LLC having an office at
c/o Brookfield Financial Properties, Inc., One Liberty Plaza, 165 Broadway, New
York, New York 10006 (herein called “Landlord”), and ARCH INSURANCE COMPANY, a
Missouri corporation, having an office at 110 William Street, New York, New
York  10038 (herein called “Tenant”).

 

Landlord and Tenant do hereby covenant and
agree as follows:

 

ARTICLE 1

 

Term and Fixed
Rent

 

1.01.                        Landlord hereby leases to
Tenant, and Tenant hereby hires from Landlord, upon and subject to the terms,
covenants, provisions and conditions of this lease, the premises described in
Section 1.02 in the building (herein called the “Building”) known as One
Liberty Plaza, 165 Broadway in the City, County and State of New York, together
with the right to use in common with other tenants of the Building and their
invitees, customers, and employees, the general common facilities located in
the Building to the extent required for access to the Premises or use of the
Premises for general and executive offices, subject to the terms, covenants,
provisions and conditions of this lease. 
The Building is located on a portion of the land (herein called the
“Land”) described in Exhibit A annexed hereto and made a part
hereof.

 

1.02.                        The Premises (herein called the
“Premises”) leased to Tenant are the entire rentable area of the fifty-third
(53rd) floor of the Building, as shown hatched on the floor plan attached hereto
as Exhibit B and made a part hereof. 
Landlord and Tenant hereby covenant and agree that the Premises shall be
deemed to contain 45,123 rentable square feet based on Landlord’s current
standards of measurement.

 

1.03.                        The term of this lease (a)
shall commence on the date hereof (herein called the “Commencement Date”) and
(b) shall end at 11:59 p.m. on the last day of the calendar month in which
occurs the day immediately preceding the tenth (10th) anniversary of the
Commencement Date (herein called the “Expiration Date”), or on such earlier
date upon which the term of this lease shall expire or be cancelled or
terminated pursuant to any of the conditions or covenants of this lease or
pursuant to law.

 

1.04.                        The rents shall be and consist
of:

 

(a)                                  fixed rent (herein
called “Fixed Rent”) at the following rate:

 

 

(i)                                     ONE MILLION EIGHT
HUNDRED EIGHTY-SEVEN THOUSAND TWO HUNDRED NINETY and 94/100 ($1,887,290.94)
DOLLARS per annum for the period beginning on the Commencement Date and ending
on May 31, 2006;

 

(ii)                                  TWO MILLION ONE
HUNDRED SIXTY-FIVE THOUSAND NINE HUNDRED FOUR and 00/100 ($2,165,904.00)
DOLLARS per annum for the period beginning on June 1, 2006 and ending on June
30, 2007; and

 

(iii)                               TWO MILLION THREE
HUNDRED FORTY-SIX THOUSAND THREE HUNDRED NINETY-SIX and 00/100 ($2,346,396.00)
DOLLARS per annum for the period beginning on July 1, 2007 and ending on the
Expiration Date;

 

and such Fixed Rent shall be payable in equal
monthly installments commencing on the Commencement Date and thereafter, in advance,
on the first day of each and every calendar month during the term of this
lease; and

 

(b)                                 additional rent
(herein called “Additional Charges”) consisting of Tax Payments (hereinafter
defined), Operating Payments (hereinafter defined), charges for electricity
furnished to Tenant and all other sum of money as shall become due from and
payable by Tenant to Landlord hereunder;

 

all to be paid in lawful money of the United
States to Landlord at its office, or such other place, or to Landlord’s agent
and at such other place, as Landlord shall designate by notice to Tenant.

 

1.05.                        Intentionally Omitted.

 

1.06. (a)       Tenant covenants and agrees to pay Fixed Rent
and Additional Charges promptly when due without notice or demand therefor and
without any abatement, deduction or setoff for any reason whatsoever, except as
may be expressly provided in this lease. 
Fixed Rent and Additional Charges shall be paid by good and sufficient
check (subject 

 

2

 

to collection) drawn on (x) a New York City
bank which is a member of the New York Clearing House Association or a
successor thereto or (y) such other bank, the checks of which shall clear
within three (3) business days after deposit in Landlord’s bank.

 

(b)                     Tenant hereby expressly
acknowledges that Landlord is not required to send monthly rent invoices to
Tenant in connection with this lease. 
However, Landlord agrees that to the extent it does send monthly rent
invoices to Tenant in connection with this lease, such monthly rent invoices
shall be sent to Tenant at the following address  as provided by Tenant: 
c/o First American Financial Corporation, 100 First Stamford Place-
Suite 325, Stamford, CT. 06902, Attention: Accounting; provided that in
no event shall the foregoing be deemed to create any obligation on Landlord’s
part to send monthly rent invoices to Tenant, nor shall any failure by Landlord
to send such monthly rent invoices to Tenant effect Tenant’s obligations under
this lease to pay monthly installments of Fixed Rent on the first day of each
and every calendar month during the term hereof in accordance with the
provisions of this lease.

 

1.07.            No payment by Tenant or receipt or
acceptance by Landlord of a lesser amount than the correct Fixed Rent or
Additional Charges shall be deemed to be other than a payment on account, nor
shall any endorsement or statement on any check or any letter accompanying any
check or payment be deemed an accord and satisfaction, and Landlord may accept
such check or payment without prejudice to Landlord’s right to recover the
balance or pursue any other remedy in this lease or at law provided.

 

1.08.            Any apportionments or prorations of Fixed
Rent or Additional Charges to be made under this lease shall be computed on the
basis of a 360-day year (based on 12 months of 30 days each).

 

1.09.            If any of the Fixed Rent or Additional
Charges payable under the terms and provisions of this lease shall be or become
uncollectible, reduced or required to be refunded because of any act or law enacted
by a governmental authority, Tenant shall enter into such agreement(s) and take
such other steps (without additional expense to Tenant) as Landlord may request
and as may be legally permissible to permit Landlord to collect the maximum
rents which from time to time during the continuance of such legal rent
restriction may be legally permissible (but not in excess of the amounts
reserved therefor under this lease). Upon the termination of such legal rent
restriction, (a) the Fixed Rent and/or Additional Charges shall become and
thereafter be payable in accordance with the amounts reserved herein for the
periods following such termination, and (b) Tenant shall pay to Landlord
promptly upon being billed, to the maximum extent legally permissible, an amount
equal to (i) the Fixed Rent and/or Additional Charges which would have been
paid pursuant 

 

3

 

to this lease but for such legal rent
restriction less (ii) the rents paid by Tenant during the period such legal
rent restriction was in effect.

 

1.10.            Additional Charges shall be deemed to be
rent and Tenant’s failure to pay Additional Charges shall be considered a
failure to pay Fixed Rent hereunder and Landlord shall be entitled to all
rights and remedies provided herein or by law for a default in the payment of
Additional Charges as for a default in the payment of Fixed Rent
(notwithstanding the fact that Tenant may not then also be in default in the
payment of Fixed Rent).

 

ARTICLE 2

 

Delivery and
Use of Premises

 

2.01.            Tenant acknowledges that Tenant has
inspected the Premises, is fully familiar with the condition thereof and
accepts the Premises absolutely “as is”. 
Landlord is to perform no work in readying the Premises for Tenant’s
occupancy.

 

2.02.            Tenant shall use and occupy the Premises
for general and executive offices and for no other purpose.

 

2.03.            If any governmental license or permit
(other than a Certificate of Occupancy for the entire Building) shall be
required for the proper and lawful conduct of Tenant’s business in the Premises
or any part thereof, Tenant, at its expense, shall duly procure and thereafter
maintain such license or permit and submit the same to Landlord for
inspection.  Tenant shall at all times
comply with the terms and conditions of each such license or permit.  Additionally, should Alterations
(hereinafter defined) or Tenant’s use of the Premises for other than executive
and general offices require any modification or amendment of any Certificate of
Occupancy for the Building, Tenant shall, at its expense, take all actions
reasonably requested by Landlord in order to procure any such modification or
amendment and shall reimburse Landlord (as Additional Charges) for all
reasonable costs and expenses Landlord incurs in effecting said modifications
or amendments.  The foregoing provisions
are not intended to be deemed Landlord’s consent to any Alterations or to a use
of the Premises not otherwise permitted hereunder nor to require Landlord to
effect such modifications or amendments of any Certificate of Occupancy.

 

2.04.            Tenant shall not at any time use or occupy
the Premises or the Building, or suffer or permit anyone to use or occupy the
Premises, or do anything in the Premises or the Building, or suffer or permit
anything to be done in, brought into or kept on the Premises, 

 

4

 

which in any manner (a) violates the
Certificate of Occupancy for the Premises or for the Building; (b) causes or is
liable to cause injury to the Premises or the Building or any equipment,
facilities or systems therein; (c) constitutes a violation of the laws and
requirements of any public authorities or the requirements of insurance bodies,
provided such insurance requirements do not prohibit the use of the Premises
for the purposes permitted under Section 2.02 hereof; (d) impairs or tends to
impair the character, reputation or appearance of the Building as a first-class
office building; (e) impairs or tends to impair the proper and economic
maintenance, operation and repair of the Building and/or its equipment,
facilities or systems; (f) annoys or inconveniences or tends to annoy or
inconvenience other tenants or occupants of the Building; (g) constitutes a
nuisance, public or private; (h) makes unobtainable from reputable insurance
companies authorized to do business in New York State all-risk property
insurance, or liability, elevator, boiler or other insurance at standard rates
required to be furnished by Landlord under the terms of any mortgages covering the
Premises; or (i) discharges objectionable fumes, vapors or odors into the
Building’s flues or vents or otherwise.

 

2.05.            Tenant shall not use, or suffer or permit
anyone to use, the Premises or any part thereof, for (a) a banking, trust
company, or safe deposit business, (b) a savings bank, a savings and loan
association, or a loan company operating an “off the street” business to the
general public at the Premises, (c) the sale of travelers’ checks and/or
foreign exchange, (d) a stock brokerage office or for stock brokerage purposes
operating an “off the street” business to the general public at the Premises or
using all or a portion of the Premises as a trading floor or trading operation;
provided, however, that Tenant shall have the right to use the Premises as
executive and general offices for a stock brokerage business which conducts its
trading operations and “off the street” business to the general public at
locations other than the Premises and performs only non-face-to-face electronic
trading operations at the Premises, (e) a restaurant and/or bar and/or the sale
of confectionery and/or soda and/or beverages and/or sandwiches and/or ice
cream and/or baked goods (except if expressly provided otherwise elsewhere in
this lease), (f) the business of photographic reproductions and/or offset
printing (except that Tenant and its permitted assignees, subtenants and
occupants may use part of the Premises for photographic reproductions and/or
offset printing in connection with, either directly or indirectly, its own
business and/or activities), (g) an employment or travel agency (except a
travel agency for the exclusive use of employees of Tenant), (h) a school or
classroom, (i) medical or psychiatric offices, (j) conduct of an auction, (k)
gambling activities or (1) the conduct of obscene, pornographic or similar
disreputable activities.  Further, the
Premises may not be used by (i) an agency, department or bureau of the United
States Government, any state or municipality within the United States or any
foreign government, or any political subdivision of any of them, (ii) any
charitable, religious, union or other not-for-profit organization, or (iii) any
tax exempt entity within the meaning of Section 168(j)(4)(A) of the Internal
Revenue Code of 1986, as 

 

5

 

amended, or any successor or substitute
statute, or rule or regulation applicable thereto (as same may be amended).

 

ARTICLE 3

Escalations

 

3.01.            The terms defined below shall for the purposes of this lease have
the meanings herein specified:

 

(a)          “Base Operating Amount” (i) for the period
beginning on the Commencement Date and ending May 31, 2006, shall mean one-half
of the sum of the Operating Expenses incurred for the Operating Years
commencing January 1, 1991 and January 1, 1992, respectively; and (ii) for
the period beginning June 1, 2006 and ending on the Expiration Date, shall mean
the Operating Expenses incurred for the Operating Year commencing January 1,
2003.

 

(b)         “Base Tax Amount” (i) for the period beginning
on the Commencement Date and ending May 31, 2006, shall mean the Taxes for the
Tax Year commencing on July 1, 1991; and (ii) for the period beginning June 1,
2006 and ending on the Expiration Date, shall mean the Taxes for the Tax Year
commencing July 1, 2002.

 

(e)          “Landlord’s Statement” shall mean an
instrument or instruments setting forth the Operating Payment (hereinafter
defined) payable by Tenant for a specified Operating Year pursuant to this
Article 3.

 

(d)         “Operating Expenses” shall mean all expenses
incurred by Landlord and Landlord’s affiliates and/or on their behalf in
respect of the repair, replacement, maintenance, operation and/or security of
the Real Property (hereinafter defined), including, without limitation, (i)
salaries, wages, medical, surgical, insurance (including, without limitation,
group life and disability insurance), union and general welfare benefits,
pension benefits, severance and sick day payments, and other fringe benefits of
employees of Landlord or Landlord’s affiliates (at and below the level of
senior building manager) and their respective contractors engaged in such
repair, replacement, maintenance, operation and/or security; provided, however,
that to the extent that such employees provide services to both the Building
and other buildings owned or operated by Landlord or Landlord’s affiliates, any
amount included in this subparagraph (i) shall be appropriately prorated; (ii)
payroll taxes, worker’s compensation, uniforms and related expenses (whether
direct or indirect) for such employees; (iii) the cost of fuel, gas, steam,
electricity, heat, ventilation, air conditioning, chilled and condenser water,
water, sewer and other utilities, together with any 

 

6

 

taxes and surcharges on, and fees paid in
connection with the calculation and billing of, such utilities; (iv) the cost
of painting and/or decorating all areas of the Real Property, excluding,
however, any space contained therein which is demised to tenant(s); (v) the
cost of casualty, liability, fidelity, rent and all other insurance regarding
the Real Property and/or any property on, below or above the Real Property, and
the repair, replacement, maintenance, operation and/or security thereof; (vi)
the cost of all supplies, tools, materials and equipment, whether by purchase
or rental, used in the repair, replacement, maintenance, operation and/or
security of the Real Property, and any sales and other taxes thereon; (vii) the
rental value of the Landlord’s Building office and any other premises in the
Real Property utilized by the personnel of either Landlord or Landlord’s
affiliates or contractors, in connection with the repair, replacement,
maintenance, operation and/or security thereof calculated as if the aggregate
rentable area of such office and other premises is 7,000 rentable square feet,
and all Building office expenses, such as telephone, utility, stationery and
similar expenses incurred in connection therewith; (viii) the cost of cleaning,
janitorial and security services, including, without limitation, glass
cleaning, snow and ice removal and garbage and waste collection and/or
disposal; (ix) the cost of all interior and exterior landscaping and all
temporary exhibitions located at or within the Real Property; (x) the cost of
alterations and improvements made or installed by reason of the laws and
requirements of any public authorities or the requirements of insurance bodies
and all tools and equipment related thereto; (xi) the cost of all other alterations,
repairs, replacements and/or improvements made by Landlord or Landlord’s
affiliates, at their respective expense, whether structural or non-structural,
ordinary or extraordinary, foreseen or unforeseen, and whether or not required
by this lease, and all tools and equipment related thereto; provided, however,
that if under generally accepted accounting principles consistently applied,
any of the costs referred to in this clause (x) or clause (xi) are required to
be capitalized, then such capitalized costs (and, at Landlord’s option, any
other costs included in Operating Expenses), together with interest thereon at
the Interest Rate (as defined in subsection 35.05(j) hereof) in effect as of
December 31 of the year in which such expenditure is made, shall be amortized
or depreciated, as the case may be, over a period of time which shall be the
shorter of: (A) the useful life of the item in question, as reasonably
determined by Landlord in accordance with applicable Internal Revenue Code
provisions and implementing rulings and regulations thereof; or (B) ten (10)
years; provided however that with respect to any capital improvement and/or any
machinery or equipment which has the effect of reducing the expenses which
otherwise would be included in Operating Expenses, the amount included in
Operating Expenses in any Operating Year until such improvement and/or
machinery or equipment has been fully amortized or depreciated, as the case may
be, shall be an amount which is the greater of:  (X) the amortization or depreciation, as the case may be, of such
capital improvement and/or machinery or equipment, which would have been
included in Operating Expenses pursuant to the foregoing provisions; or (Y) the
amount of savings, as reasonably estimated by Landlord, resulting from the
installation and operation of such improvement 

 

7

 

and/or machinery or equipment; (xii)
management fees, provided, however, that if Landlord or an affiliate
of Landlord is the managing agent of the Building then the annual management
fee shall be equal to two and one-half (2-1/2%) percent of rents and additional
rents payable by those tenants of the Building which are leasing space therein;
(xiii) all reasonable costs and expenses of legal, bookkeeping, accounting and
other professional services incurred in connection with the operation of the
Real Property; (xiv) fees, dues and other contributions paid by or on
behalf of Landlord or Landlord’s affiliates to civic or real estate organizations
customarily joined by owners of first class buildings in downtown Manhattan;
and (xv) all other fees, costs, charges and expenses properly allocable to the
repair, replacement, maintenance, operation and/or security of the Real
Property, in accordance with then prevailing customs and practices of the real
estate industry in the Borough of Manhattan, City of New York.  Notwithstanding anything to the contrary
contained in the foregoing, for the period beginning on the Commencement Date
and ending May 31, 2006, the amount to be included in the Base Operating Amount
and subsequent years for the management fees will not be as described in clause
(xii) above, but rather, the management fees included in the Base Operating
Amount shall be an amount equal to $1,237,209.00, and for each subsequent
Operating Year the management fees will be that sum as increased annually by
the “Consumer Price Index” (as defined in subsection 35.05(k) hereof).  Furthermore, the parties hereto agree that
the amount (as increased by the Consumer Price Index) included in management
fees for Operating Year 2001 was $1,601,785.00, and that the amount for each
Operating Year after 2001 until May 31, 2006 shall be the product obtained by
multiplying (i) the amount included for the previous Operating Year by (ii) the
increase in the Consumer Price Index for such previous Operating Year.

 

The term “Operating Expenses”, as used and
defined under this subsection (d), shall not, however, include the following
items:  (1) depreciation and
amortization (except as provided above in this subsection); (2) interest on and
amortization of debts; (3) the cost of tenant improvements made for new
tenant(s) of the Building; (4) brokerage commissions; (5) financing or
refinancing costs; (6) the cost of any work or services performed for any
tenant(s) of the Building (including Tenant), whether at the expense of
Landlord or Landlord’s affiliates or such tenant(s), to the extent that such
work or services are in excess of the work or services which Landlord or Landlord’s
affiliates are required to furnish Tenant under this lease, at the expense of
Landlord or Landlord’s affiliates; (7) the cost of any electricity consumed in
the Premises or any other space in the Building demised to tenant(s);
(8) Taxes; (9) rents and additional rents under Superior Leases (as
defined in Section 5.01 hereof); (10) legal, appraisal and accounting fees,
disbursements and charges incurred in connection with the leasing, sale or
refinancing of the Building and legal, appraisal and accounting fees,
disbursements and charges incurred in connection with disputes with Tenant or
other tenants or occupants of the Building, except that legal fees, 

 

8

 

disbursements and charges incurred in
connection with disputes with Tenant or other tenants relating to (a) the
maintenance and operation of the Land and Building or (b) a tenant who is
disturbing other tenants in the Building by reason of such tenant’s breach of
its lease, shall be included in Operating Expenses, but only provided that such
fees, disbursements and charges are not recovered from such tenants or
occupants; (11) the costs of removing asbestos from the Building; provided,
however, that the costs of removing asbestos therefrom shall be included in
Operating Expenses but only to the extent that such removal is performed in
non-leaseable areas of the Building ancillary to and in conjunction with the
performance of maintenance, repairs or replacements in such areas of the
Building; (12) salaries for Landlord’s executives above the grade of senior
building manager; (13) expenses in an amount equal to proceeds of insurance
received by Landlord (or amounts which Landlord would have received if Landlord
had carried the insurance required under this lease), to the extent such
proceeds are (or would have been) compensation for expenses which were
previously included in Operating Expenses; (14) the cost of repairs or
replacements incurred by reason of fire or other casualty or condemnation,
except that in connection therewith any amount equal to the deductibles under
Landlord’s insurance policies provided such deductibles are not substantially
higher than the deductibles customarily carried by landlords of first class
office buildings comparable to the Building (or in the event Landlord shall not
carry insurance, the amount of deductibles customarily carried by landlords of
first class office buildings comparable to the Building) may be included in
Operating Expenses; (15) advertising expenditures; (16) costs of alterations
and improvements made to cure violations of laws and requirements of public
authorities which violations are existing on the Commencement Date and any
fines or penalties imposed by legal authorities having jurisdiction thereof by
reason of such existing violations; (17) amounts paid to affiliates of Landlord
in excess of commercially reasonable costs for goods or services rendered by
such affiliates; (18) general home office overhead expenses of Landlord or
Landlord’s affiliates except for costs of bookkeeping, accounting and auditing
specifically allocable to the Building by Landlord or Landlord’s affiliates;
(19) costs for acquiring works of fine art (as distinguished from decorative
items) displayed in the public areas of the Building; (20) interest, fines,
penalties or other late payment charges paid by Landlord as a result of
Landlord’s failure to make payments when due unless Landlord’s failure to make
such payments when due was in good faith, in which case the interest, fines,
penalties or other late payment charges in connection therewith may be included
in Operating Expenses; (21) capital expenditures other than those which (i) are
occasioned by the necessity of compliance with any law or requirements of any
public authority or the requirements of insurance bodies, or (ii) are
reasonably intended to reduce Operating Expenses, or (iii) are in the nature of
or in lieu of a repair, or (iv) involves an upgrade of Building systems or
facilities or the installation of security equipment which included capital
expenditures, shall be amortized in accordance with clause (xi) above; (22)
rental for equipment ordinarily considered to be of a capital nature, except if
such equipment is customarily leased in the operation of first class 

 

9

 

Manhattan office buildings or the cost of the
purchase of such equipment could be included in Operating Expenses pursuant to
clauses (x) and (xi) of this subsection 3.01(e); (23) damages awarded to a
tenant of the Building against Landlord by reason of Landlord’s breach of that
tenant’s lease in the Building; and (24) costs incurred in connection with the
removal, encapsulation, enclosure, handling, or other treatment of asbestos or
any other hazardous substance or in connection with the clean-up or other
remediation of any spill or other release of any thereof.

 

(e)          “Operating Year” shall mean each calendar
year in which occurs any part of the term of this lease.

 

(f)            “Real Property” shall mean, collectively,
the Building (together with all personal property located therein and all
fixtures, facilities, machinery and equipment used in the operation thereof,
including, but not limited to, all cables, fans, pumps, boilers, heating and
cooling equipment, wiring and electrical fixtures and metering, control and
distribution equipment, component parts of the HVAC, electrical, plumbing,
elevator and any life or property protection systems (including, without
limitation, sprinkler systems), window washing equipment and snow removal
equipment), the Land, any property beneath the Land, the curbs, sidewalks and
plazas on and/or immediately adjoining the Land, and all easements, air rights,
development rights and other appurtenances to the Building or the Land or both
the Land and the Building.

 

(g)         “Taxes” shall mean (A) the real estate taxes,
vault taxes, assessments and special assessments and business improvement
district or similar charges levied, assessed or imposed upon or with respect to
the Real Property by any federal, state, municipal or other governments or
governmental bodies or authorities and (B) all taxes assessed or imposed with
respect to the rentals payable hereunder other than general income and gross
receipts taxes.  If at any time during
the term of this lease the methods of taxation prevailing on the date hereof
shall be altered so that in lieu of, or as an addition to or as a substitute
for, the whole or any part of such real estate taxes, assessments and special
assessments now imposed on real estate, there shall be levied, assessed or
imposed (x) a tax, assessment, levy, imposition, license fee or charge wholly
or partially as a capital levy or otherwise on the rents received therefrom, or
(y) any other such additional or substitute tax, assessment, levy, imposition,
fee or charge, then all such taxes, assessments, levies, impositions, fees or
charges or the part thereof so measured or based shall be deemed to be included
within the term “Taxes” for the purposes hereof.  Taxes shall not include any fines, interest and penalties for
late payments of Taxes, unless a substantial number of owners of Class A office
buildings in the borough of Manhattan, City of New York are paying similar
fines, interest and penalties in response to a course of action taken by the
applicable taxing authorities.  The
amount of any special assessments, public improvements or benefits to be 

 

10

 

included in Taxes for any year, in the case
where the same may, at the option of the taxpayer, be paid in installments,
shall be limited to the amount of the minimum installments plus interest
charges by the applicable taxing authorities due in respect of such year
(whether or not Landlord elects to pay in any such minimum installment).

 

(h)         “Tax Year” shall mean each period of twelve
(12) months, commencing on the first day of July of each such period, in which
occurs any part of the term of this lease, or such other period of twelve (12)
months occurring during the term of this lease as hereafter may be duly adopted
as the fiscal year for real estate tax purposes of the City of New York.

 

(i)             “Tenant’s Share” shall mean 2.1%.

 

3.02.            (a) 
If Taxes payable for any Tax Year, including the Tax Year in which the
Commencement Date occurs, shall exceed the Base Tax Amount, Tenant shall pay to
Landlord as Additional Charges for such Tax Year an amount (herein called the
“Tax Payment”) equal to Tenant’s Share of the amount by which the Taxes for
such Tax Year are greater than the Base Tax Amount.  The Tax Payment for each Tax Year shall be due and payable in
installments in the same manner that Taxes for such Tax Year are due and
payable by Landlord to the City of New York. 
Tenant shall pay Tenant’s Share of each such installment within twenty
(20) days after the rendering of a statement therefor by Landlord to Tenant,
which statement may be rendered by Landlord so as to require Tenant’s Share of
Taxes to be paid by Tenant thirty (30) days prior to the date such Taxes
first become due.  The statement to be
rendered by Landlord shall set forth in reasonable detail the computation of
Tenant’s Share of the particular installment(s) being billed.  If there shall be any increase in the Taxes
for any Tax Year, whether during or after such Tax Year, or if there shall be
any decrease in the Taxes for any Tax Year, the Tax Payment for such Tax Year
shall be appropriately adjusted and paid or refunded, as the case may be, in
accordance herewith; in no event, however, shall Taxes be reduced below the
Base Tax Amount.  If, during the term of
this lease, Taxes are required to be paid (either to the appropriate taxing
authorities or as tax escrow payments to a superior mortgagee) in full or in
monthly, quarterly, or other installments, on any other date or dates than as presently
required, then at Landlord’s option, Tenant’s Tax Payments shall be
correspondingly accelerated or revised so that said Tenant’s Tax Payments are
due at least thirty (30) days prior to the date payments are due to the taxing
authorities or such superior mortgagee.

 

(b)                     If Landlord shall receive a refund
of Taxes for any Tax Year, Landlord shall either pay to Tenant, or credit
against subsequent Fixed Rent and Additional Charges under this lease, Tenant’s
Share of the net refund (after deducting from such total refund the costs and
expenses, including, but not limited to, appraisal, accounting and legal fees
of 

 

11

 

obtaining the same, to the extent that such
costs and expenses were not included in the Taxes for such Tax Year); provided,
however, such payment or credit to Tenant shall in no event exceed Tenant’s Tax
Payment paid for such Tax Year. 
Notwithstanding the foregoing, in the event that Landlord receives any
refund or abatement of Taxes pursuant to the Lower Manhattan Plan (as such term
is defined in Section 37.01(a)(i) hereof), (i) Tenant shall not be entitled to
any payment or credit under this Lease in connection with such refund or
abatement except as set forth in Article 36 hereof and (ii) for purposes of
computing Tenant’s Tax Payment, there shall not be deducted from Taxes all or
any portion of such refund or abatement.

 

(c)                      Nothing contained in this lease
shall obligate Landlord to bring any application or proceeding seeking a
reduction in Taxes or assessed valuation. 
Tenant, for itself and its immediate and remote subtenants and
successors in interest hereunder, hereby waives, to the extent permitted by
law, any right Tenant may now or in the future have to protest or contest any
Taxes or to bring any application or proceeding seeking a reduction in Taxes or
assessed valuation or otherwise challenging the determination thereof.

 

(d)                     The benefit of any discount for
the early payment or prepayment of Taxes shall accrue solely to the benefit of
Landlord and such discount shall not be subtracted from Taxes unless Landlord
shall have obtained such discount by reason of Tenant’s prepayment of its Tax
Payment.

 

(e)                      In respect of any Tax Year which
begins prior to the Commencement Date or terminates after the Expiration Date,
the Tax Payment in respect of each such Tax Year or tax refund pursuant to
subdivision (b) above therefor shall be prorated to correspond to that portion
of such Tax Year occurring within the term of this lease.

 

(f)                        If the Taxes comprising the
Base Tax Amount are reduced as a result of an appropriate proceeding or
otherwise, the Taxes as so reduced shall, for all purposes, be deemed to be the
Taxes for the Base Tax Amount and Landlord shall give notice to Tenant of the
amount by which the Tax Payments previously made were less than the Tax
Payments required to be made under this Article 3, and Tenant shall pay the
amount of the deficiency within twenty (20) days after demand therefor.

 

(g)                     For each Tax Year after the Tax
Year commencing July 1, 2002, Tenant shall pay as additional rent hereunder,
within twenty (20) days after delivery of a statement therefor, Tenant’s Share
of any reasonable or customary expenses incurred by Landlord, including
payments to attorneys, accountants and appraisers, in protesting and/or
contesting any items of Taxes or the assessed valuations of all or any part of
the Real Property.

 

12

 

3.03.                        (a)  For each Operating Year, including the Operating Year in which
the Commencement Date occurs, any part of which shall occur during the term of
this lease, Tenant shall pay an amount (herein called the “Operating Payment”)
equal to Tenant’s Share of the amount by which the Operating Expenses for such
Operating Year exceed the Base Operating Amount.

 

(b)                                 If during the year for
which the Base Operating Amount is computed or in any subsequent Operating Year
(1) any rentable space in the Building shall be vacant or unoccupied, and/or
(ii) the tenant or occupant of any space in the Building undertook to perform
work or services therein in lieu of having Landlord (or Landlord’s affiliates)
perform the same and the cost thereof would have been included in Operating
Expenses, then, in any such event(s), the Operating Expenses for such period
shall be adjusted to reflect the Operating Expenses that would have been
incurred if such space had been occupied or if Landlord (or Landlord’s
affiliates) had performed such work or services, as the case may be.

 

(c)                                  Landlord may furnish
to Tenant, prior to the commencement of each Operating Year, a written
statement setting forth Landlord’s reasonable estimate of the Operating Payment
for such Operating Year which estimate shall not exceed 115% of Tenant’s actual
Operating Payment during the immediately preceding Operating Year unless
Landlord can substantiate increases in excess of such amount.  Tenant shall pay to Landlord on the first
day of each month during the Operating Year in which the Operating Payment will
be due an amount equal to one-twelfth (1/12th) of Landlord’s estimate of the
Operating Payment for such Operating Year. 
If, however, Landlord shall not furnish any such estimate for an
Operating Year or if Landlord shall furnish any such estimate for an Operating
Year subsequent to the commencement thereof, then (i) until the first day of
the month following the month in which such estimate is furnished to Tenant,
Tenant shall pay to Landlord on the first day of each month an amount equal to
the monthly sum payable by Tenant to Landlord under this Article 3 in respect
of the last month of the preceding Operating Year; (ii) after such estimate is
furnished to Tenant, Landlord shall give notice to Tenant stating whether the
installments of the Operating Payment previously made for such Operating Year
were greater or less than the installments of the Operating Payment to be made
for the Operating Year in which the Operating Payment will be due in accordance
with such estimate, and (A) if there shall be a deficiency, Tenant shall pay
the amount thereof within twenty (20) days after demand therefor, or (B) if
there shall have been an overpayment, Landlord shall refund to Tenant the
amount thereof; and (iii) on the first day of the month following the month in
which such estimate is furnished to Tenant and monthly thereafter throughout
the remainder of such Operating Year, Tenant shall pay to Landlord an amount
equal to one-twelfth (1/12th) of the Operating Payment shown on such
estimate.  Landlord may, during each
Operating Year, furnish to Tenant a revised statement of Landlord’s estimate of
the 

 

13

 

Operating Payment for such Operating Year,
and in such case, the Operating Payment for such Operating Year shall be
adjusted and paid or refunded or credited, as the case may be, substantially in
the same manner as provided in the preceding sentence.

 

(d)                                 Landlord shall furnish
to Tenant a Landlord’s Statement for each Operating Year (and shall endeavor to
do so within one hundred twenty (120) days after the end of each Operating
Year).  If the Landlord’s Statement
shall show that the sums paid by Tenant, if any, under Section 3.03(c) exceeded
the Operating Payment to be paid by Tenant for the Operating Year for which
such Landlord’s Statement is furnished, Landlord shall, when rendering
Landlord’s Statement, refund to Tenant the amount of such excess; and if the
Landlord’s Statement for such Operating Year shall show that the sums so paid
by Tenant were less than the Operating Payment to be paid by Tenant for such
Operating Year, Tenant shall pay, without prejudice to Tenant’s rights pursuant
to this Article 3 to dispute the amount thereof, the amount of such deficiency
within twenty (20) days after demand therefor.

 

(e)                                  (i) Tenant, upon reasonable
notice given within ninety (90) days of the receipt of such Landlord’s
Statement, may elect to have Tenant’s designated (in such notice) Certified
Public Accountant (who may be an employee of Tenant) examine such of Landlord’s
books and records (collectively “Records”) as are directly relevant to the
Landlord’s Statement in question which Records Landlord agrees will be kept in
a commercially reasonable manner.  In
making such examination, Tenant agrees, and shall cause its designated
Certified Public Accountant to agree, to keep confidential (i) any and all
information contained in such Records and (ii) the circumstances and details
pertaining to such examination and any dispute or settlement between Landlord
and Tenant arising out of such examination; and Tenant will confirm and cause
its Certified Public Accountant to confirm such agreement in a separate written
agreement, if requested by Landlord.  If
Tenant shall not give such notice within such ninety (90) day period, then the
Landlord’s Statement as furnished by Landlord shall be conclusive and binding
upon Tenant.

 

(ii)                                  In the event that
Tenant, after having reasonable opportunity to examine the Records (but in no
event more than sixty (60) days from the date on which the Records are made
available to Tenant), shall disagree with the Landlord’s Statement, then Tenant
may send a written notice (“Tenant’s Statement”) to Landlord of such
disagreement, specifying in reasonable detail the basis for Tenant’s
disagreement and the amount of the Operating Payment Tenant claims is due.  Landlord and Tenant shall attempt to adjust
such disagreement.  If they are unable
to do so, Landlord and Tenant shall designate a Certified Public Accountant
(the “Arbiter”) whose determination made in accordance with this Section
3.03(e)(ii) shall be binding upon the parties. 
If the determination of Arbiter shall substantially confirm the
determination of Landlord, then Tenant shall pay the cost of the 

 

14

 

Arbiter. 
If the determination of Arbiter shall substantially confirm the
determination of Tenant, then Landlord shall pay the cost of the Arbiter.  In all other events, the cost of the Arbiter
shall be borne equally by Landlord and Tenant. 
The Arbiter shall be a member of an independent certified public
accounting firm having at least three (3) accounting professionals and having
at least five (5) years of experience in commercial real estate
accounting.  In the event that Landlord
and Tenant shall be unable to agree upon the designation of the Arbiter within
thirty (30) days after receipt of notice from the other party requesting
agreement as to the designation of the Arbiter, which notice shall contain the
names and addresses of two or more Certified Public Accountants who are
acceptable to the party sending such notice (any one of whom, if acceptable to
the party receiving such notice as shall be evidenced by notice given by the
receiving party to the other party within such thirty (30) day period, shall be
the agreed upon Arbiter), then either party shall have the right to request the
Real Estate Board of New York, Inc., or if such organization fails to act in
accordance herewith or no longer exists, then the American Arbitration
Association (the “AAA”) (or any organization which is the successor thereto) to
designate as the Arbiter a Certified Public Accountant, reasonably acceptable
to both parties, whose determination made in accordance with this Section
3.03(e)(ii) shall be conclusive and binding upon the parties, and the cost
charged by the Real Estate Board of New York, Inc. (or if such organization
fails to act in accordance herewith or no longer exists, by the AAA or any
organization which is the successor thereto), for designating such Arbiter,
shall be shared equally by Landlord and Tenant.  Landlord and Tenant hereby agree that any determination made by
an Arbiter designated pursuant to this Section 3.03(e)(ii) shall not exceed the
amount(s) as determined to be due in the first instance by Landlord’s Statement,
nor shall such determination be less than the amount(s) claimed to be due by
Tenant in Tenant’s Statement, and that any determination which does not comply
with the foregoing shall be null and void and not binding on the parties.  In rendering such determination such Arbiter
shall not add to, subtract from or otherwise modify the provisions of this
lease, including the immediately preceding sentence.  Notwithstanding the foregoing provisions of this section, Tenant,
pending the resolution of any contest pursuant to the terms hereof, shall
continue to pay all sums as determined to be due in the first instance by such
Landlord’s Statement and upon the resolution of such contest, suitable
adjustment shall be made in accordance therewith with appropriate refund to be
made by Landlord to Tenant (or credit allowed Tenant against Additional Charges
becoming due) if required thereby.  For
purposes hereof, the phrase “substantially confirm” shall mean that the
Arbiter’s determination shall vary by one percent (1%) or less from the
determination of the Landlord or the Tenant, as the case may be.

 

3.04.                        (a)  In any case provided in this Article 3 in which Tenant is
entitled to a refund, Landlord may, in lieu of allowing such refund, credit
against future installments of Fixed Rent and Additional Charges any amounts to
which Tenant shall be entitled provided 

 

15

 

that there are subsequent installments of
Fixed Rent and Additional Charges against which such refund can be applied.  Nothing in this Article 3 shall be construed
so as to result in a decrease in the Fixed Rent hereunder.  If this lease shall expire before any such
credit shall have been fully applied, then (provided Tenant is not in default
hereunder) Landlord shall refund to Tenant the unapplied balance of such
credit.

 

(b)                                 The expiration or
termination of this lease during any Tax Year or Operating Year (for any part
or all of which there is a Tax Payment or Operating Payment under this Article
3) shall not affect the accrued rights or obligations of the parties hereto
respecting such payment and any Landlord’s Statement or tax bill, as the case
may be, relating to such payment may be sent to Tenant subsequent to, and all
such rights and obligations shall survive, any such expiration or
termination.  Any payments due under
such Landlord’s Statement or tax bill, as the case may be, shall be payable
within twenty (20) days after such statement or bill is sent to Tenant.

 

(c)                                  The parties agree
that the computations under this Article 3 are intended to constitute a formula
for agreed rental escalation and may or may not constitute an actual
reimbursement to Landlord for Taxes and other costs and expenses paid by
Landlord with respect to the Real Property.

 

3.05.                        Landlord’s failure to render or
delay in rendering a Landlord’s Statement with respect to any Operating Year or
any component of the Operating Payment shall not prejudice Landlord’s right to
thereafter render a Landlord’s Statement with respect to any such Operating
Year or any such component, nor shall the rendering of a Landlord’s Statement
for any Operating Year prejudice Landlord’s right to thereafter render a
corrected Landlord’s Statement for such Operating Year, provided, however, that
in the event that Landlord shall have failed to render a Landlord’s Statement
for Operating Expenses with respect to any Operating Year within the three (3)
year period following the expiration of any such Operating Year, then, in such
event, Tenant shall have the right to give Landlord a notice of Landlord’s
failure to render such Operating Statement, and if Landlord shall thereafter
fail to render such Operating Statement within thirty (30) days from the giving
of Tenant’s notice with respect thereto, Landlord shall be deemed to have
waived its right to render such Operating Statement with respect to such
Operating Year.  Landlord’s failure to
render or delay in rendering a bill with respect to any installment of Taxes
shall not prejudice Landlord’s right to thereafter render such a bill for much
installment, nor shall the rendering of a bill for any installment prejudice
Landlord’s right to thereafter render a corrected bill for such installment,
provided, however, that in the event that the Landlord shall have failed to render
a bill with respect to any Tax Payment for any Tax Year within the three (3)
year period following the expiration of such Tax Year, then, in such event,
Tenant shall have the right to give Landlord of notice of Landlord’s failure to
render such bill, and, if Landlord 

 

16

 

shall thereafter fail to render such bill
within thirty (30) days from the giving of Tenant’s  notice with respect thereto, Landlord shall be deemed to have
waived its right to render a bill for tax escalation with respect to such Tax
Year.

 

ARTICLE 4

 

Security

 

4.01.                        Tenant
shall deposit with Landlord,
upon Tenant’s execution of this lease, the sum of NINE HUNDRED FORTY-THREE
THOUSAND SIX HUNDRED and 00/100 ($943,600.00) DOLLARS as security for
the full and faithful performance and observance by Tenant of Tenant’s
covenants and obligations under this lease. 
Landlord shall hold such security deposit in an interest-bearing account
in a bank to be selected by Landlord, and the interest thereon shall be
returned to Tenant upon Tenant’s written request but no more frequently than
annually.  If Tenant defaults beyond
notice and the expiration of any applicable cure period, in the full and prompt
payment and performance of any of Tenant’s covenants and obligations under this
lease, including, but not limited to, the payment of Fixed Rent and Additional
Charges, Landlord may, but shall not be required to, use, apply or retain the
whole or any part of the security so deposited and the interest accrued
thereon, if any, to the extent required for the payment of any Fixed Rent and
Additional Charges or any other sums as to which Tenant is in default or for
any sum which Landlord may expend or may be required to expend by reason of
Tenant’s default in respect of any of the terms, covenants and conditions of
this lease, including, but not limited to, any damages or deficiency in the
reletting of the Premises, whether such damages or deficiency accrue before or
after summary proceedings or other re-entry by Landlord.  If Landlord shall so use, apply or retain
the whole or any part of the security or the interest accrued thereon, if any,
Tenant shall upon demand immediately deposit with Landlord a sum equal to the
amount so used, applied or retained, as security as aforesaid failing which
Landlord shall have the same rights and remedies as for the non-payment of
Fixed Rent beyond the applicable grace period. 
If Tenant shall pay all Fixed Rent and Additional Charges due and
payable under this lease and shall surrender the Premises to Landlord in
accordance with the provisions of this lease, the security or any balance
thereof, to which Tenant is entitled, shall be returned or paid over to Tenant
after the date fixed as the end of this lease and after delivery to Landlord of
entire possession of the Premises.  In
the event of a sale, transfer or leasing of Landlord’s interest in the Building
whether or not in connection with a sale, transfer or leasing of the Land to a
vendee, transferee or lessee, Landlord shall have the right to transfer the
unapplied part of the security and the interest thereon, if any, to which
Tenant is entitled, to the vendee, transferee or lessee and Landlord shall
thereupon be released by Tenant from all liability for the return or payment
thereof, and Tenant shall look solely to the new landlord for the return or
payment 

 

17

 

of the
same.  The provisions of the preceding
sentence shall apply to every subsequent sale, transfer or leasing of the
Building, and any successor of Landlord may, upon a sale, transfer, leasing or
other cessation of the interest of such successors in the Building, whether in
whole or in part, pay over any unapplied part of said security to any vendee,
transferee or lessee of the Building and shall thereupon be relieved of all
liability with respect thereto.  Except
in connection with a permitted assignment of this lease, Tenant shall not
assign or encumber or attempt to assign or encumber the monies deposited herein
as security or any interest thereon to which Tenant is entitled, and neither
Landlord nor its successors or assigns shall be bound by any such assignment,
encumbrance, attempted assignment or attempted encumbrance.  In any event, in the absence of evidence
satisfactory to Landlord of an assignment of the right to receive the security,
or the remaining balance thereof, Landlord may return the security to the
original Tenant regardless of one or more assignments of this lease.

 

4.02.                        In
lieu of the cash security deposit provided for in Section 4.01 hereof,
Tenant may at any time during the term hereof deliver to Landlord and shall
thereafter maintain in effect at all times during the term hereof, as security
for the full and faithful performance and observance by Tenant of Tenant’s
covenants and obligations under this lease, an unconditional irrevocable letter
of credit in the amount of NINE
HUNDRED FORTY-THREE THOUSAND SIX HUNDRED and 00/100 ($943,600.00) Dollars, substantially in the form annexed
hereto as Exhibit H   and otherwise reasonably satisfactory to
Landlord and issued by a banking corporation reasonably satisfactory to
Landlord and either having its principal place of business or a duly licensed
branch or agency in the borough of Manhattan, City and County of New York.  Such letter of credit shall have an
expiration date no earlier than the first anniversary of the date of issuance
thereof and shall be automatically renewed from year to year unless terminated
by the issuer thereof by notice to Landlord given not less than forty-five (45)
days prior to the expiration thereof. 
Tenant shall, throughout the term of this lease, deliver to Landlord, in
the event of the termination of any such letter of credit, replacement letters
of credit in lieu thereof (each such letter of credit and such extensions or
replacements thereof, as the case may be, is herein referred to as a “Security
Letter”) no later than 30 days prior to the expiration date of the
preceding Security Letter.  The term of
each such Security Letter shall be not less than one year and shall be
automatically renewable from year to year as aforesaid.  Notwithstanding the foregoing, if Landlord
shall elect, in its sole discretion, to accept a Security Letter which is
subject to a final expiration date, Tenant shall deliver a replacement of or
amendment to such Security Letter no later than thirty (30) days prior to such
final expiration date, and the final Security Letter delivered 

 

18

 

to Landlord pursuant to this Section 4.02
shall have a final expiration date occurring not earlier than sixty (60) days
following the Expiration Date of this lease. 
If Tenant shall fail to obtain any replacement of or amendment to a
Security Letter within any of the applicable time limits set forth in this
Section 4.02, Tenant shall be in default of its obligations under this Article
4 and Landlord shall have the right (but not the obligation), at its option, to
draw down the full amount of the existing Security Letter and use, apply and
retain the same as security hereunder, and notwithstanding such draw by
Landlord, Landlord shall have the right (but not the obligation), at its
option, to give written notice to Tenant stating that such failure by Tenant to
deliver such replacement of or amendment to the Security Letter constitutes a
continuing default by Tenant of its obligations under this Article 4, and in
the event that Tenant shall not have delivered such replacement or amendment to
Landlord within fifteen (15) Business Days after Tenant’s receipt of such
notice, Landlord may give to Tenant a notice of intention to end the term of
this lease at the expiration of five days from the date of the service of such
notice of intention, and upon the expiration of said five days this lease and
the term and estate hereby granted, whether or not the term shall theretofore
have commenced, shall terminate (as set forth in Section 22.02 hereof) with the
same effect as if that day was the day herein definitely fixed for the end and
expiration of this Lease, but Tenant shall remain liable for damages as
provided in Article 24 hereof. 
Upon delivery to Landlord of any such replacement of or amendment to the
Security Letter within the fifteen (15) Business Day period described in the preceding
sentence, such default shall be deemed cured and Landlord shall return to
Tenant the proceeds of the Security Letter which had been drawn by Landlord
pursuant to the preceding sentence (or any balance thereof to which Tenant is
entitled).

 

4.03.                        In the event Tenant defaults in
respect of the full and prompt payment and performance of any of the terms,
provisions, covenants and conditions of this Lease beyond notice (the delivery
of which shall not be required for purposes of this Section 4.03 if Landlord is
prevented or prohibited from delivering the same under applicable law,
including, but not limited to, all applicable bankruptcy and insolvency law)
and the expiration of any applicable cure periods (except that no notice and
cure period shall be required for purposes of this Section 4.03 with respect to
any default by Tenant hereunder if, at the time of such default, 

 

19

 

any of the events set forth in Section 22.01
shall have occurred with or without the acquiescence of Tenant), including, but
not limited to, the payment of Fixed Rent and Additional Charges, Landlord may,
at its election, (but shall not be obligated to) draw down the entire Security
Letter or any portion thereof and use, apply or retain the whole or any part of
the security represented by the Security Letter to the extent required for the
payment of: (i) Fixed Rent, Additional Charges or any other sum as to which
Tenant is in default, (ii) any sum which Landlord may expend or may be required
to expend by reason of Tenant’s default in respect of any of the terms,
provisions, covenants, and conditions of this Lease, including but not limited
to, any reletting costs or expenses (including, without limitation, any free
rent, tenant improvement allowance, leasing commissions, attorneys’ fees, costs
and expenses, and other fees, costs and expenses relating to the reletting of
all or any portion of the Premises), (iii) any damages or deficiency in the
reletting of the Premises, whether such damages or deficiency accrued before or
after summary proceedings or other re-entry by Landlord, or (iv) any damages
awarded to Landlord in accordance with the terms and conditions of Article 24
hereof.  To insure that Landlord may
utilize the security represented by the Security Letter in the manner, for the
purpose, and to the extent provided in this Article 4, each Security Letter
shall provide that the full amount or any portion thereof may be drawn down by
Landlord upon the presentation to the issuing bank (or the advising bank, if
applicable) of Landlord’s draft drawn on the issuing bank without accompanying
memoranda or statement of beneficiary. 
In no event shall the Security Letter require Landlord to submit evidence
to the issuing (or advising) bank of the truth or accuracy of any such written
statement and in no event shall the issuing bank or Tenant have the right to
dispute the truth or accuracy of any such statement nor shall the issuing (or
advising) bank have the right to review the applicable provisions of the
Lease.  In no event and under no
circumstance shall the draw down on or use of any amounts under the Security
Letter constitute a basis or defense to the exercise of any other of Landlord’s
rights and remedies under this Lease or under any law, rule or regulation,
including, but not limited to, Landlord’s right to assert a claim against
Tenant under 11 U.S.C. §502(b)(6) or any other provision of title 11 of the
United States Code.

 

4.04.                        In the event that Tenant defaults in
respect of any of the terms, provisions, covenants and conditions of the Lease
beyond notice and the expiration of 

 

20

 

any applicable cure periods (except to the
extent that such notice and cure periods are not applicable pursuant to Section
4.03 above) and Landlord utilizes all or any part of the security represented
by the Security Letter but does not terminate this Lease as provided in Article
22 hereof, Landlord may, in addition to exercising its rights as provided in
Section 4.03 hereof, retain the unapplied and unused balance of the portion of
the Security Letter drawn down by Landlord (herein called the “Cash Security”)
as security for the faithful performance and observance by Tenant thereafter of
the terms, provisions, and conditions of this Lease, and may use, apply, or
retain the whole or any part of said Cash Security to the extent required for
payment of Fixed Rent, Additional Charges, or any other sum as to which Tenant
is in default or for any sum which Landlord may expend or be required to expend
by reason of Tenant’s default in respect of any of the terms, covenants, and
conditions of this Lease.  In the event
Landlord uses, applies or retains any portion or all of the security
represented by the Security Letter, Tenant shall forthwith restore the amount
so used, applied or retained (at Landlord’s option, either by the deposit with
Landlord of cash or the provision of a replacement Security Letter) so that at
all times the amount of the security represented by the Security Letter and the
Cash Security (if any) shall be not less than the security required by Section
4.01 hereof, failing which Tenant shall be in default of its obligations under
this Article 4 and Landlord shall have the same rights and remedies as for the
non-payment of Fixed Rent beyond the applicable grace period.

 

4.05.                        If Tenant shall fully and faithfully
comply with all of Tenant’s covenants and obligations under this Lease, the
Security Letter and the Cash Security (if any) shall be returned to Tenant
after the date fixed as the end of this Lease and after delivery to Landlord of
entire possession of the Premises; provided, however, that in no event shall
any such return be construed as an admission by Landlord that Tenant has
performed all of its obligations hereunder. 
In the event of any sale, transfer or leasing of Landlord’s interest in
the Building whether or not in connection with a sale, transfer or leasing of
the Land to a vendee, transferee or lessee, Landlord shall have the right to
transfer the Security Letter and the Cash Security (if any) to the vendee,
transferee or lessee or, in the alternative, to require Tenant to deliver a
replacement Security Letter naming the new landlord as beneficiary, and, upon
such delivery by Tenant of 

 

21

 

such replacement Security Letter, Landlord
shall return the existing Security Letter to Tenant.  Upon such transfer or return of the Security Letter and the Cash
Security (if any), Landlord shall thereupon be released by Tenant from all
liability for the return  thereof, and
Tenant shall look solely to the new landlord for the return of the same.  The provisions of the preceding sentence
shall apply to every subsequent sale, transfer or leasing of the Building, and
any successor of Landlord may, upon a sale, transfer, leasing or other
cessation of the interest of such successors in the Building, whether in whole
or in part, transfer the Security Letter and the Cash Security (if any) to any
vendee, transferee or lessee of the Building (or require Tenant to deliver a
replacement Security Letter as hereinabove set forth) and shall thereupon be
relieved of all liability with respect thereto.  If Tenant shall fail to timely deliver such replacement Security
Letter, Tenant shall be in default of its obligations under this Article 4 and
Landlord shall have the right (but not the obligation), at its option, to draw
down the existing Security Letter and retain the proceeds as security hereunder
until a replacement Security Letter is delivered, and notwithstanding such draw
by Landlord, Landlord shall have the right (but not the obligation), at its
option, to give written notice to Tenant stating that such failure by Tenant to
deliver such replacement Security Letter constitutes a continuing default by
Tenant of its obligations under this Article 4, and in the event that Tenant
shall not have delivered such replacement to Landlord within fifteen (15)
Business Days after Tenant’s receipt of such notice, Landlord may give to
Tenant a notice of intention to end the term of this Lease at the expiration of
five days from the date of the service of such notice of intention, and upon
the expiration of said five days this Lease and the term and estate hereby
granted shall terminate in accordance with the provisions of the penultimate
sentence of Section 4.02 hereof.  Upon
delivery to Landlord of any such replacement Security Letter within the fifteen
(15) Business Day period described in the preceding sentence, such default shall
be deemed cured and Landlord shall return to Tenant the proceeds of the
Security Letter which had been drawn by Landlord pursuant to the preceding
sentence (or any balance thereof to which Tenant is entitled).  Landlord and Tenant hereby agree that, in
connection with the transfer by Landlord or its successors or assigns hereunder
of Landlord’s interest in the Security Letter, Tenant shall be solely liable to
pay any transfer commission and other costs charged by the issuing bank in
connection with any such transfer of the Security Letter, as 

 

22

 

Additional Charges hereunder, upon Landlord’s
demand therefor.  Except in connection
with a permitted assignment of this Lease, Tenant shall not assign or encumber
or attempt to assign or encumber the security represented by the Security
Letter, and neither Landlord nor its successors or assigns shall be bound by
any such assignment, encumbrance, attempted assignment or attempted
encumbrance.  In any event, in the
absence of evidence satisfactory to Landlord of an assignment of the right to
receive the security represented by the Security Letter, Landlord may return
the Security Letter to the original Tenant regardless of one or more
assignments of this Lease.

 

4.06.                        Neither the Security Letter, any
proceeds therefrom or the Cash Security, if any, shall be deemed an advance
rent deposit or an advance payment of any other kind, or a measure or
limitation of Landlord’s damages or constitute a bar or defense to any of the
Landlord’s other remedies under this Lease or at law or in equity upon Tenant’s
default.

 

4.07.                        As a material inducement to Landlord
to enter into this Lease, Tenant hereby acknowledges and agrees that the
Security Letter and the proceeds thereof (including, without limitation any
Cash Security created by the draw down of all or any portion of the Security
Letter) and the obligation to make available or pay to Landlord all or a
portion thereof in satisfaction of any obligation of Tenant under this Lease,
shall be deemed third-party obligations and not the obligation of Tenant
hereunder and, accordingly, (A) shall not be subject to any limitation on
damages contained in Section 502(b)(6) of Title 11 of the United States Code or
any other limitation on damages that may apply under any federal, state or
local law, rule or regulation in connection with a bankruptcy, insolvency or
other similar proceeding by, against or on behalf of Tenant, (B) shall not
diminish or be offset against any amounts that Landlord would be able to claim
against Tenant pursuant to 11 U.S.C. §502(b)(6) as if no Security Letter
existed, and (C) may be relied on by Landlord in the event of an
assignment of this Lease that is not expressly in accordance with the terms of
this Lease even if such assignment has been authorized and approved by a court
exercising jurisdiction in connection with a bankruptcy, insolvency or other
similar proceeding by, against or on behalf of Tenant.

 

4.08.                        Notwithstanding the foregoing,
provided that Tenant is not then in default with respect to any of the 

 

23

 

terms, provisions and conditions of this
lease on its part to be performed, Landlord agrees that the amount of the
security deposit required under this Article 4 shall be reduced as follows: (x)
to $500,000.00 on July 1, 2007, and (y) to $0.00 on July 1, 2008, and in the
case of clause (x) above, in the event that the security deposit required
hereunder shall be in the form of a Security Letter, the Security Letter then
in effect may be replaced by Tenant with a Security Letter in the amount of
$500,000.00 in the same form and manner as described heretofore in this Article
4.

 

ARTICLE 5

 

Subordination, Notice to Superior Lessors and
Mortgagees

 

5.01.                        This lease,  and all rights of Tenant hereunder, are and shall be subject and
subordinate to all ground leases, overriding leases and underlying leases of
the Land and/or the Building and/or that portion of the Building of which the
Premises are a part, now or hereafter existing and to all mortgages which may
now or hereafter affect the Land and/or the Building and/or that portion of the
Building of which the Premises are a part and/or any of such leases, whether or
not such mortgages shall also cover other lands and/or buildings and/or leases,
to each and every advance made or hereafter to be made under such mortgages,
and to all renewals, modifications, replacements and extensions of such leases
and such mortgages and spreaders and consolidations of such mortgages.  This Section 5.01 shall be self-operative
and no further instrument of subordination shall be required.  In confirmation of such subordination,
Tenant shall within fifteen (15) days of Landlord’s request therefor,  execute, acknowledge and deliver any
instrument that Landlord, the lessor under any such lease or the holder of any
such mortgage or any of their respective successors in interest may reasonably
request to evidence such subordination. 
Any lease to which this lease is, at the time referred to, subject and
subordinate is herein called “Superior Lease” and the lessor of a Superior
Lease or its successor in interest, at the time referred to, is herein called
“Superior Lessor”; and any mortgage to which this lease is, at the time
referred to, subject and subordinate is herein called “Superior Mortgage” and
the holder of a Superior Mortgage is herein called “Superior Mortgagee.”

 

24

 

5.02.                        If any act or omission of Landlord
would give Tenant the right, immediately or after lapse of a period of time, to
cancel or terminate this lease, or to abate or offset against the payment of
rent or to claim a partial or total eviction, Tenant shall not exercise such
right (a) until it has given written notice of such act or omission to Landlord
and each Superior Mortgagee and each Superior Lessor whose name and address
shall previously have been furnished to Tenant, and (b) until a reasonable
period for remedying such act or omission shall have elapsed following the
giving of such notice and following the time when such Superior Mortgagee or
Superior Lessor shall have become entitled under such Superior Mortgage or
Superior Lease, as the case may be, to remedy the same (which reasonable period
shall in no event be less than the period to which Landlord would be entitled
under this lease or otherwise, after similar notice, to effect such remedy),
provided such Superior Mortgagee or Superior Lessor shall with due diligence
give Tenant notice of intention to, and commence and continue to, remedy such
act or omission.

 

5.03.                        If any Superior Lessor or Superior
Mortgagee, or any assignee or successor in interest of any Superior Lessor or
Superior Mortgagee, shall succeed to the rights of Landlord under this lease,
whether through possession or foreclosure action or delivery of a new lease or
deed, then at the request of such party so succeeding to Landlord’s rights
(herein called ‘Successor Landlord”) and upon such Successor Landlord’s written
agreement to accept Tenant’s attornment, Tenant shall attorn to and recognize
such Successor Landlord as Tenant’s landlord under this lease and shall within
fifteen (15) days of request therefor, execute and deliver any instrument that
such Successor Landlord may reasonably request to evidence such attornment but
only to the extent and subject to the condition that Landlord shall have
complied with its obligations under Section 5.05 hereof.  Upon such attornment this lease shall
continue in full force and effect as a direct lease between the Successor
Landlord and Tenant upon all of the terms, conditions and covenants as are set
forth in this lease, except that so long as the Successor Landlord is not an
entity which is controlled by, controls or is under common control with
Landlord, such Successor Landlord shall not be:

 

(a)                                  liable for any previous act or
omission of Landlord (or its predecessors in interest);

 

25

 

(b)                                 responsible for any monies owing by
Landlord to the credit of Tenant;

 

(c)                                  subject to any credits, offsets,
claims, counterclaims, demands or defenses which Tenant may have against
Landlord (or its predecessors in interest);

 

(d)                                 bound by any payments of rent which
Tenant might have made for more than one (1) month in advance to Landlord (or
its predecessors in interest);

 

(e)                                  bound by any covenant to undertake or
complete any construction of the Premises or any portion thereof;

 

(f)                                    required to account for any security
deposit other than any security deposit actually delivered to the Successor
Landlord;

 

(g)                                 bound by any obligation to make any
payment to Tenant or grant or be subject to any credits, except for services,
repairs, maintenance and restoration provided for under this lease to be
performed after the date of attornment and which landlords of like properties
ordinarily perform at the Landlord’s expense, it being expressly understood,
however, that the Successor Landlord shall not be bound by an obligation to
make payment to Tenant with respect to construction performed by or on behalf
of Tenant at the Premises;

 

(h)                                 bound by any modification of this
lease, including without limitation, any modification which reduces the Fixed
Rent or Additional Charges or other charges payable under this lease, or
shortens the term thereof, or otherwise materially adversely affects the rights
of the lessor thereunder, made without the written consent of the Successor
Landlord; or

 

(i)                                     required to remove any person
occupying the Premises or any part thereof.

 

5.04.                        (a)                                  Landlord
represents that the only Superior Mortgage in existence on the date hereof is
held by State Street Bank and Trust Company, as trustee for a trust fund
established pursuant to a Trust and Servicing Agreement, dated as of February
23, 2001 among GS Mortgage Securities Corporation II, as depositor, and
serviced by ORIX 

 

26

 

Real Estate
Capital Markets, LLC (herein called the “Existing Mortgagee”).  Landlord further represents that such
Superior Mortgage is in full force and effect.

 

(b)                                 Landlord
represents that there are no Superior Leases in existence on the date hereof.

 

5.05.                        (a)                                  Landlord
agrees to use reasonable efforts to obtain and deliver to Tenant a
subordination, non-disturbance and attornment agreement (herein called an “SNDA
Agreement”), in recordable form, from the Existing Mortgagee substantially in
the form of Exhibit I hereof. 
Tenant and Landlord shall execute concurrently with the execution of
this lease six (6) counterparts of the SNDA Agreement, which SNDA Agreements
Landlord shall promptly deliver to the Existing Mortgagee for
counter-execution. Tenant shall be liable to pay the fees (if any) charged by
the Existing Mortgagee, including, without limitation, attorney’s fees, for
entering into such SNDA Agreements. 
Such fees shall be due and payable to Landlord, as Additional Charges
hereunder, within ten (10) days after Tenant’s receipt of an invoice
therefor.  If Landlord is unable to
obtain the counter-execution of the SNDA Agreement with such changes thereto as
are reasonably requested by such Superior Mortgagee, Landlord shall have no
liability to Tenant and this lease shall not be affected thereby.

 

(b)                                 With
respect to any future Superior Mortgage or Superior Lease affecting the Real
Property, Landlord agrees (subject to the qualifications hereinafter set forth)
to use commercially reasonable efforts (i.e., at no cost whatsoever to
Landlord, as set forth in the last sentence of this paragraph), to obtain from
the holders of any such future Superior Mortgages and future Superior Leases,
an SNDA Agreement in favor of Tenant on the customary form employed by such
Superior Mortgagee or Superior Lessor (as the case may be), which shall provide
in substance that so long as no default exists hereunder, Tenant shall not be
disturbed in its possession of the Premises pursuant to the provisions of this
lease. Provided that any such SNDA Agreement shall provide in substance that so
long as no default exists under this lease, Tenant shall not be disturbed in its
possession of the Premises pursuant to the provisions of this lease and such
SNDA Agreement is otherwise in form and substance reasonably satisfactory to
Tenant, Tenant agrees to execute any such SNDA Agreement and deliver the same
to Landlord within ten (10) days after receipt thereof.  Notwithstanding the foregoing, Landlord
shall have no liability to Tenant and this lease shall not be affected in the
event that Landlord is unable, despite such reasonable efforts, to obtain an
SNDA Agreement from the holder of any future Superior Mortgage or Superior
Lease (as the case may be), and Landlord shall in no event be required to
expend any monies or commence or prosecute litigation or reject financing which
is otherwise satisfactory to it to obtain such an SNDA Agreement, and Tenant
shall be liable to pay the reasonable fees charged by the Superior Mortgagee or
Superior Lessor, as the case may be, including, 

 

27

 

without
limitation, reasonable attorney’s fees, in connection with obtaining such SNDA
Agreements.

 

ARTICLE 6

 

Quiet Enjoyment

 

6.01.                        So long as Tenant pays all of the
Fixed Rent and Additional Charges and observes and performs all of Tenant’s
other obligations hereunder, Tenant shall peaceably and quietly have, hold and
enjoy the Premises without hindrance, ejection or molestation by Landlord or
any person lawfully claiming through or under Landlord, subject, nevertheless,
to the provisions of this lease and to Superior Leases and Superior Mortgages.  This covenant shall be construed as a
covenant running with the Land, and is not, nor shall it be construed as, a
personal covenant of Landlord, except to the extent of Landlord’s interest in
the Real Property and only so long as such interest shall continue, and
thereafter Landlord shall be relieved of all liability hereunder and this
covenant shall be binding only upon subsequent successors in interest of
Landlord’s interest in this lease, to the extent of their respective interests,
as and when they shall acquire the same, and so long as they shall retain such
interest.

 

ARTICLE 7

 

Assignment, Subletting and Mortgaging

 

7.01.                        Tenant shall not, whether voluntarily,
involuntarily, or by operation of law or otherwise (a) assign in whole or in
part or otherwise transfer in whole or in part 
this lease or the term and estate hereby granted, or offer or advertise
to do so, (b) sublet the Premises or any part thereof, or offer or advertise to
do so, or allow the same to be used, occupied or utilized by anyone other than
Tenant, (c) mortgage, pledge, encumber or otherwise hypothecate this lease or
the Premises or any part thereof in any manner whatsoever or (d) permit the
Premises or any part thereof to be occupied, or used for desk space, mailing
privileges or otherwise, by any person other than Tenant, without in each
instance obtaining the prior written consent of Landlord.

 

28

 

7.02.                        If Tenant (or any subtenant) is a
corporation, ‘the provisions of subdivision (a) of Section 7.01 shall apply to
a transfer (however accomplished, whether in a single transaction or in a
series of related or unrelated transactions) of stock (or any other mechanism
such as, by way of example, the issuance of additional stock, a stock voting
agreement or change in class(es) of stock) which results in a change of control
of Tenant (or such subtenant) as if such transfer of stock (or other mechanism)
which results in a change of control of Tenant (or such subtenant) were an
assignment of this lease, and if Tenant (or such subtenant) is a partnership or
joint venture or limited liability company (herein called a “LLC”), said provisions shall apply with
respect to a transfer (by one or more transfers) of an interest in the
distributions of profits and losses of such partnership or joint venture (or
other mechanism, such as, by way of example, the creation of additional general
partnership or limited partnership interests) which results in a change of
control of such partnership, joint venture or LLC, as if such transfer of an
interest in the distributions of profits and losses of such partnership, joint
venture or LLC which results in a change of control of such partnership, joint
venture or LLC were an assignment of this lease.  The transfer of shares of Tenant (if Tenant is a corporation or
trust) for purposes of this Section 7.02 shall not include the sale of shares
by persons other than those deemed “insiders” within the meaning of the
Securities Exchange Act of 1934, as amended, which sale is effected through the
“over-the-counter market” or through any recognized stock exchange.  The provisions of subdivision (a) of Section
7.01 (including, specifically, the requirement of obtaining Landlords consent
to any assignment of the lease or subletting of the Premises, in whole or in
part) shall not, however, apply to transactions with a corporation into or with
which Tenant is merged or consolidated or to transactions with a corporation or
partnership to which substantially all of Tenant’s assets are transferred or to
any corporation (herein called a “Tenant’s Affiliate”) which controls or is
controlled by or is under common control with Tenant, provided that in any of
such events (i) the successor to Tenant or transferee is a reputable entity of
good character and if such successor or transferee is not a Tenant’s Affiliate
provided such successor has a net worth computed in accordance with generally
accepted accounting principles at least equal to the greater of (1) the net
worth of Tenant immediately prior to such merger, consolidation or transfer, or
(2) the net worth of the Tenant herein named on the date of this lease, (ii)
proof satisfactory to Landlord of such net worth shall have 

 

29

 

been delivered to Landlord at least ten (10)
days prior to the effective date of any such transaction, (iii) a duplicate
original instrument of assignment in form and substance reasonably satisfactory
to Landlord, duly executed by Tenant, shall have been delivered to Landlord at
least ten (10) days prior to the effective date of any such transaction, (iv)
an instrument in form and substance satisfactory to Landlord, duly executed by
the assignee, in which such assignee assumes (as of the Commencement Date)
observance and performance of, and agrees to be personally bound by, all of the
terms, covenants and conditions of this lease on Tenant’s part to be performed
and observed shall have been delivered to Landlord at least ten (10) days prior
to the effective date of any such transaction, and (v) such merger,
consolidation or transfer shall be for a good business purpose and not
principally for the purpose of transferring this lease.  For purposes of this Section 7.02, the term
“control” shall mean, in the case of a corporation,  ownership or voting control, directly or indirectly, of at least
fifty percent (50%) of all the voting stock, and in case of a joint venture or
partnership or similar entity, ownership, directly or indirectly, of at least
fifty percent (50%) of all the general or other partnership (or similar)
interests therein, and in either case, the possession of the power to direct or
cause the direction of the management and policy of such corporation or other
entity whether through the ownership of voting securities by statute, by
contract, or otherwise.  Any agreement
pursuant to which (x) Tenant is relieved from the obligation to pay, or a third
party agrees to pay on Tenant s behalf, all or a part of Fixed Rent or Additional
Charges under this lease, and/or (y) such third party undertakes or is granted
any right to assign or attempt to assign this lease or sublet or attempt to
sublet all or any portion of the Premises, shall be deemed an assignment of
this lease and subject to the provisions of Section 7.01.

 

7.03.                        If this lease be assigned, whether or
not in violation of the provisions of this lease, Landlord may collect rent
from the assignee.  If the Premises or
any part thereof are sublet or used or occupied by anybody other than Tenant,
whether or not in violation of this lease, Landlord may, after default by
Tenant, after notice (the delivery of which shall not be required for purposes
of this Section 7.03 if Landlord is prevented or prohibited from delivering the
same under applicable law, including, but not limited to, all applicable
bankruptcy and insolvency law) and the expiration of any applicable cure
periods (except that no notice and cure 

 

30

 

period shall be required for purposes of this
Section 7.03 with respect to any default by Tenant hereunder if, at the time of
such default, any of the events set forth in Section 22.01 shall have occurred
with or without the acquiescence of Tenant), collect rent from the subtenant or
occupant.  In either event, Landlord may
apply the net amount collected to the Fixed Rent and Additional Charges herein
reserved, but no such assignment, subletting, occupancy or collection shall be
deemed a waiver of any of the provisions of Section 7.01, or the acceptance of
the assignee, subtenant or occupant as tenant, or a release of Tenant from the
performance by Tenant of Tenant’s obligations under this lease.  The consent by Landlord to a particular
assignment, mortgaging, subletting or use or occupancy by others shall not in any
way be considered a consent by Landlord to any other or further assignment,
mortgaging or subletting or use or occupancy by others not expressly permitted
by this Article 7.  References in this
lease to use or occupancy by others (that is, anyone other than Tenant) shall
not be construed as limited to subtenants and those claiming under or through
subtenants but shall also include licensees and others claiming under or
through Tenant, immediately or remotely.

 

7.04.                        Any assignment or transfer, whether made
with Landlord’s consent pursuant to Sections 7.01 or 7.11 hereof or without
Landlord’s consent pursuant to Section 7.02 hereof, shall be made only if, and
shall not be effective until, the assignee shall execute, acknowledge and
deliver to Landlord an agreement in form and substance reasonably satisfactory
to Landlord whereby the assignee shall assume the obligations of this lease on
the part of Tenant to be performed or observed and whereby the assignee shall
agree that the provisions in Section 7.01 shall, notwithstanding such
assignment or transfer, continue to be binding upon it in respect of all future
assignments and transfers.  The original
named Tenant covenants that, notwithstanding any assignment or transfer,
whether or not in violation of the provisions of this lease, and
notwithstanding the acceptance of Fixed Rent and/or Additional Charges by
Landlord from an assignee, transferee, or any other party, the original named
Tenant shall remain fully liable for the payment of the Fixed Rent and Additional
Charges and for the performance and observance of other obligations of this
lease on the part of Tenant to be performed or observed.

 

7.05.                        The joint and several liability of
Tenant and any immediate or remote successor in interest of Tenant 

 

31

 

and the due performance of the obligations of
this lease on Tenants part to be performed or observed shall not be discharged,
released or impaired in any respect by any agreement or stipulation made by
Landlord extending the time of, or modifying any of the obligations of this
lease, or by any waiver (other than an express written waiver by Landlord) or
failure of Landlord to enforce any of the obligations of this lease.  If any such agreement or modification
operates to increase the obligations of a tenant under this lease, the
liability under this Section 7.05 of the tenant named in the lease or any of
its successors in interest (unless such party shall have expressly consented in
writing to such agreement or modification) shall continue to be no greater than
if such agreement or modification had not been made.

 

7.06.                        The listing of any name other than
that of Tenant, whether on the doors of the Premises or the Building directory,
or otherwise, shall not operate to vest any right or interest in this lease or
in the Premises, nor shall it be deemed to be the consent of Landlord to any
assignment or transfer of this lease or to any sublease of the Premises or to
the use or occupancy thereof by others.

 

7.07.                        Notwithstanding anything to the
contrary contained in this Article 7, if Tenant shall at any time or times
during the term of this lease desire to assign this lease or sublet all or part
of the Premises, Tenant shall give notice thereof to Landlord (herein called
“Tenant’s Article 7 Offer Notice”), which notice shall set forth in the case of
a subletting: (a) the area proposed to be sublet, (b) the term of the proposed
subletting and the date the area to be sublet is intended to be vacated by
Tenant, (c) the work contributions, if any, periods of rent free occupancy, if
any, purchase price of any of Tenant’s furniture, fixtures and equipment, and
(d) the rents and all other financial terms (the items set forth in the
foregoing clauses (c) and (d) are herein in the aggregate called the
“Proposed Rent Rate”) pursuant to which Tenant is willing to enter into a
sublease with a third party.  In the
case of a proposed assignment, Tenant’s Article 7 Offer Notice shall set forth Tenant’s
intention to (x) assign the lease in whole, it being understood and agreed that
partial assignments of the lease are not permitted hereunder, (y) the proposed
date upon which the Premises are intended to be vacated by Tenant, and (z) all
financial and other material terms of the proposed assignment.  Tenant’s Article 7 Offer Notice shall be
deemed an irrevocable offer from Tenant to Landlord whereby Landlord (or 

 

32

 

Landlord’s designee) may, at its option, (i)
accept an assignment of this lease from Tenant (if the proposed transaction is
an assignment of this lease or a sublease of all or substantially all of the
Premises for substantially the balance of the term of this lease), (ii)
sublease such space from Tenant upon the terms and conditions hereinafter set
forth (if the proposed transaction is a sublease of all or any portion of the
Premises), (iii) terminate this lease if the proposed transaction is an
assignment of the lease or a sublease of all or substantially all of the
Premises for substantially the balance of the term of this lease, or (iv)
terminate this lease with respect to the space covered by the proposed sublease
(if the proposed transaction is a sublease of part of the Premises for
substantially the balance of the term of the lease).  Said options may be exercised by Landlord by notice to Tenant at
any time within the later to occur of (1) thirty (30) days after such notice
has been received by Landlord and Landlord shall have received all other
information required to be furnished to Landlord by Tenant pursuant to the
provisions of this Article 7 and (2) ten (10) days after the date on which
Landlord shall have received notice of the identity of the proposed subtenant
or assignee, together with statements setting forth in reasonable detail the
nature of its business and its financial condition (as evidenced by its most
recent audited financial statement or annual report); and during such thirty
(30) day period Tenant shall not assign this lease or sublet such space to any
person.  The phrase “for substantially
the balance of the term of this lease” shall mean the period equal to the
remaining term of this lease less any period of time up to two (2) years.

 

7.08.                        (a)                                  If Landlord exercises its option to
terminate this lease in the case where Tenant desires either to assign this
lease or sublet all or substantially all of the Premises for substantially the
balance of the term of this Lease, then, this Lease shall end and expire on the
date that such assignment or sublet was to be effective or commence, as the
case may be, and the Fixed Rent and Additional Charges shall be paid and
apportioned to such date and Tenant shall not be obligated to perform any of
the obligations of Tenant to be performed hereunder from and after such date.

 

(b)                                 If Landlord exercises its option to
have this lease assigned to it (or its designee) in the case where Tenant
desires either to assign this lease or to sublet all or substantially all of
the Premises for substantially the 

 

33

 

balance of the term of this Lease, then
Tenant shall assign this lease to Landlord (or Landlord’s designee) by an
assignment in form and substance reasonably satisfactory to Landlord.  Tenant shall not be responsible for any default
by Landlord or Landlords designee as tenant under the lease after such
assignment, provided, however, that the provisions of this sentence shall not
be binding upon any Superior Mortgagee. 
Such assignment shall be effective on the date the proposed assignment
was to be effective or the date the proposed sublease was to commence, as the
case may be.  Tenant shall not be
entitled to consideration or payment from Landlord (or Landlord’s designee) in
connection with any such assignment.  If
the proposed assignee or sublessee was to receive any consideration or
concessions from Tenant in connection with the proposed assignment or sublease,
then Tenant shall pay such consideration and/or grant any such concessions to
Landlord (or Landlord’s designee) on the date Tenant assigns this lease to
Landlord (or Landlord’s designee).

 

7.09.                        If Landlord exercises its option to
terminate this lease with respect to the space covered by Tenant’s proposed
sublease in any case where Tenant desires to sublet part of the Premises for
substantially the balance of the term of this Lease, then (a) this lease shall
end and expire with respect to such part of the Premises on the date that the
proposed sublease was to commence; (b) from and after such date the Fixed Rent
and Additional Charges shall be adjusted, based upon the proportion that the
rentable area of the Premises remaining bears to the total rentable area of the
Premises; and (c) Tenant shall pay to Landlord, upon demand, as Additional
Charges hereunder the reasonable out of pocket costs incurred by Landlord in
physically separating such part of the Premises from the balance of the
Premises and in complying with any laws and requirements of any public
authorities relating to such separation and Tenant shall not be obligated to
perform any of the obligations of Tenant to be performed hereunder from and
after such date.

 

7.10.                        If Landlord exercises its option to
sublet the Premises or the portion(s) of the Premises which Tenant desires to
sublet, such sublease to Landlord or its designee (as subtenant) shall be at
the Proposed Rent Rate and shall be for the term set forth in Tenant’s Article
7 Offer Notice, and:

 

34

 

(a)                                  The sublease shall be expressly
subject to all of the covenants, agreements, terms, provisions and conditions
of this lease except such as are irrelevant or inapplicable, and except as
otherwise expressly set forth to the contrary in this section;

 

(b)                                 Such sublease shall be upon the same
terms and conditions as those contained in Tenant’s Article 7 Offer Notice,
except such as are irrelevant or inapplicable and except as otherwise expressly
set forth to the contrary in this section;

 

(c)                                  Such sublease shall give the sublessee
the unqualified and unrestricted right, without Tenant’s permission, to assign
such sublease or any interest therein and/or to sublet the space covered by
such sublease or any part or parts of such space and to make any and all
changes, alterations, and improvements in the space covered by such sublease;

 

(d)                                 Such sublease shall provide that any
assignee or further subtenant of Landlord or its designee, may, at the election
of Landlord, be permitted to make alterations, decorations and installations in
such space or any part thereof and shall also provide in substance that any
such alterations, decorations and installations in such space therein made by
any assignee or subtenant of Landlord or its designee may be removed, in whole
or in part, by such assignee or subtenant, at its option, prior to or upon the
expiration or other termination of such sublease provided that such assignee or
subtenant, at its expense, shall repair any damage and injury to such space so
sublet caused by such removal;

 

(e)                                  Such sublease shall also provide that
(i) the parties to such sublease expressly negate any intention that any estate
created under such sublease be merged with any other estate held by either of
said parties, (ii) any assignment or subletting by Landlord or its designee (as
the subtenant) may be for any purpose or purposes that Landlord, in Landlord’s
uncontrolled discretion, shall deem suitable or appropriate, provided such
purpose shall be permitted by law (iii) Tenant, at Tenant’s expense, shall and
will at all times provide and permit reasonably appropriate means of ingress to
and egress from such space so sublet by Tenant to Landlord or its designee,
(iv) Landlord, at Tenant’s expense, may make such alterations as may be
required or deemed necessary by Landlord to physically separate the subleased
space from the 

 

35

 

balance of the Premises and to comply with
any laws and requirements of public authorities relating to such separation,
and (v) that at the expiration of the term of such sublease, Tenant will accept
the space covered by such sublease in its then existing condition, subject to
the obligations of the sublessee to make such repairs thereto as may be
necessary to preserve the premises demised by such sublease in good order and
condition;

 

(f)                                    If Landlord or Landlord’s designee as
subtenant under such sublease shall be in default (including, without
limitation, in monetary default) under such sublease or if any undertenant of
Landlord or Landlord’s designee or subtenant of Landlord or Landlord’s designee
if this lease shall be assigned to Landlord or Landlord’s designee shall be in
default under such underlease (including, without limitation, in monetary
default), then Landlord, as Landlord under this lease shall not have the right
to declare a corresponding breach by Tenant under this lease, and Tenant shall
not be responsible for any act or omission of Landlord or Landlord’s designee
or subtenant under this lease or of any subtenant or undertenant thereof,
provided, however, that the provisions of this subsection 7.10(f) shall not be
binding upon any Superior Mortgagee.

 

7.11.                        In the event Landlord does not
exercise its options pursuant to Section 7.07 to so sublet the Premises or
terminate (in whole or in part) or have assigned to it or its designee this
lease and providing that Tenant is not then in default of any of Tenant’s
obligations under this lease, Landlord’s consent (which must be in writing and
in form satisfactory to Landlord) to the proposed assignment or sublease shall
not be unreasonably withheld, provided and upon condition that:

 

(a)                                  Tenant shall request, in writing,
Landlord’s consent to each subletting or assignment, which request shall be
accompanied by (i) a duplicate original of the proposed assignment or sublease,
signed by the proposed assignee or proposed sub-tenant, the effective or
commencement date of which shall be at least thirty (30) days after the giving
of such notice, (ii) a statement setting forth in reasonable detail the
identity of the proposed assignee or subtenant, the nature of its business and
its proposed use of the Premises, and (iii) current financial information with
respect to the proposed assignee or subtenant including, without limitation,
its most recent financial report.  In
the 

 

36

 

event that Landlord shall request reasonable
additional information with respect to the proposed assignee or subtenant, then
Landlord shall make such request within ten (10) Business Days after Tenant’s
request for Landlord’s consent and Tenant shall provide such information to
Landlord as soon as reasonably practicable, and Tenant shall have complied with
the provisions of Section 7.07 and Landlord shall not have exercised any of its
options under said Section 7.07 within the time permitted therefor;

 

(b)                                 In Landlord’s reasonable judgment the
proposed assignee or subtenant is engaged in a business and the Premises, or
the relevant part thereof, will be used in a manner which (i) is in keeping
with the then standards of the Building, and (ii) will not violate any negative
covenant as to use contained in any other lease of space in the Building;

 

(c)                                  The proposed assignee or subtenant is
a reputable person or entity of good character and with sufficient financial
worth considering the responsibility involved, and Landlord has been furnished
with reasonable proof thereof;

 

(d)                                 Provided that Landlord shall have
space comparable in size then available, or to become available, for leasing in
the Building; within nine (9) months from the effective date of the proposed
assignment or subletting, as the case may be, the proposed assignee or
sublessee is not then an occupant of any part of the Building;

 

(e)                                  The proposed assignee or sublessee is
not a person with whom Landlord is then engaged in discussions to lease or is
negotiating to lease space in the Building;

 

(f)                                    The form of the proposed sublease
shall be reasonably satisfactory to Landlord and shall comply with the
applicable provisions of this Article;

 

(g)                                 There shall not be more than (A) four
(4) entities (including Tenant, Landlord or Landlord’s designee) occupying any
one full floor of the Premises, or (B) two (2) entities (including Tenant,
Landlord or Landlord’s designee) occupying any portion of the Premises located
on less than a full floor of the Building, provided that such number of
entities is permitted by the laws and requirements of public authorities;

 

37

 

(h)                                 The rental and other terms and
conditions of the sublease are the same as those contained in Tenant’s Article
7 Offer Notice therefor, except that the rental may vary by five (5%) percent
or less from the Proposed Rent Rate set forth in Tenant’s Article 7 Offer
Notice;

 

(i)                                     Tenant shall reimburse Landlord within
twenty (20) days after demand for any reasonable out-of-pocket costs incurred
by Landlord in connection with said assignment or sublease, including, without
limitation, the costs of making investigations as to the acceptability of the
proposed assignee or subtenant, and reasonable out-of-pocket legal costs
incurred in connection with the granting of any requested consent; and

 

(j)                                     Tenant shall not have (i) advertised
or publicized in any way the availability of the Premises without prior notice
to and approval by Landlord, nor shall any advertisement state the name (as
distinguished from the address) of the Building or the proposed rental, (ii)
listed the Premises for subletting, whether through a broker, agent,
representative, or otherwise at a rental rate less than the greater of (1) the
Fixed Rent and Additional Charges then payable hereunder for such space, or (2)
the Fixed Rent and Additional Charges at which Landlord is then offering to
lease other space in the Building.

 

7.12.        (a)           In the event that in connection with
Tenant’s request for Landlord’s consent pursuant to Section 7.11 hereof,
Tenant submits to Landlord a duplicate of a proposed sublease or proposed
assignment with respect to the proposed subletting or assignment set forth in
Tenant’s Article 7 Offer Notice and the provisions of such sublease or
assignment (as, for example, the space, the term, or the Proposed Rent Rate)
differ with respect to the statements set forth in the Tenant’s Article 7 Offer
Notice, provided, however, the rental may vary by five (5%) percent or
less from the Proposed Rent Rate set forth in Tenant’s Article 7 Offer Notice,
then in such event, Tenant’s request for consent pursuant to Section 7.11
hereof shall be deemed to be an offer from Tenant to Landlord as to which
Landlord shall have all of the options set forth in Section 7.07 hereof.

 

(b)           If
Landlord fails to exercise any of its options under Section 7.07 hereof, and
Tenant fails to request Landlord’s consent to an assignment or sublease on the
terms and conditions set forth in Tenant’s Article 7 Offer Notice 

 

38

 

within (x) four (4) months from the date of
Landlord’s response to Tenant’s Article 7 Offer Notice, or (y) if Landlord
fails to respond to Tenant’s Article 7 Offer Notice, within five (5) months
from the date of Tenant’s Article 7 Offer Notice, Tenant shall again comply
with all of the provisions and conditions of Section 7.07 hereof before
assigning this lease or subletting all or part of the Premises.

 

7.13.                        With respect to each and every
sublease or subletting authorized by Landlord under the provisions of this
lease (other than a sublease to Landlord or its designee pursuant to Section
7.10 hereof), it is further agreed:

 

(a)                                  No subletting shall be for a term
(including any renewal or extension options contained in the sublease) ending
later than one day prior to the expiration date of this lease;

 

(b)                                 No sublease shall be valid, and no
subtenant shall take possession of the Premises or any part thereof, until an
executed counterpart of such sublease (and all ancillary documents executed in
connection with, with respect to or modifying such sublease) has been delivered
to Landlord;

 

(c)                                  Each sublease shall provide that it is
subject and subordinate to this lease and to any matters to which this lease is
or shall be subordinate, and that in the event of termination, reentry or
dispossess by Landlord under this lease Landlord may, at its option, take over
all of the right, title and interest of Tenant, as sublessor, under such
sublease, and such subtenant shall, at Landlord’s option, attorn to Landlord
pursuant to the then executory provisions of such sublease, except that
Landlord shall not be (i) liable for any previous act or omission of Tenant
under such sublease, (ii) subject to any credit, offset, claim, counterclaim,
demand or defense which such subtenant may have against Tenant, (iii) bound by
any previous modification of such sublease or by any previous prepayment of
more than one (1) month’s rent, (iv) bound by any covenant of Tenant to
undertake or complete any construction of the Premises or any portion thereof,
(v) required to account for any security deposit of the subtenant other than
any security deposit actually delivered to Landlord by Tenant, (vi) bound by
any obligation to make any payment to such subtenant or grant any credits,
except for services, repairs, maintenance and 

 

39

 

restoration provided for under the sublease
to be performed after the date of such attornment, (vii) responsible for any
monies owing by Landlord to the credit of Tenant or (viii) required to remove
any person occupying the Premises or any part thereof; and

 

(d)                                 Each sublease shall provide that the
subtenant may not assign its rights thereunder or further sublet the space
demised under the sublease, in whole or in part, without Landlord’s consent,
which consent, Landlord agrees, shall not be unreasonably withheld or delayed
with respect to a proposed assignment or underletting of a direct subtenant of
the Named Tenant provided, however, that (i) such subtenant shall satisfy the
conditions applicable to Tenant provided in this Article 7 with respect to an
assignment of such sublease or an underletting of all or a portion of the
Premises; (ii) the proposed assignment or underletting complies with all of the
applicable provisions of this Article 7; (iii) Landlord shall receive fifty
(50%) percent of any amounts received by such subtenant from such assignment or
underletting which is in excess of the rentals it pays to Tenant under its
sublease, (iv) Landlord shall have the right to recapture such space pursuant
to the provisions of Section 7.07 hereof, as the same shall be incorporated by
reference (or otherwise) in such subtenant’s sublease; and (v) if Landlord
shall exercise the option set forth in clause (ii) of Section 7.07 hereof, then
the sublease rent payable by Landlord (or its designee) shall be at the lesser
of: (A) the proposed rental rate payable by such subtenant’s undertenant or (B)
the rate of fixed annual rental and escalation rent payable by such subtenant
under its sublease with Tenant. 
Notwithstanding any language to the contrary contained in this
subsection 7.13(d), the assignee of such subtenant shall not be permitted to
further assign such sublease or further underlease all or a portion of such
space nor shall any undertenant of such subtenant be permitted to assign its
leasehold interest under such underletting agreement or further underlease all
or a portion of such space.

 

7.14.        (a)           If Landlord shall give its consent to
any assignment of this lease or to any sublease, or if all or any part of the
Premises shall be sublet to Landlord or Landlord’s designee pursuant to Section
7.07 hereof, Tenant shall in either event, pay to Landlord, as Additional
Charges an amount equal to fifty percent (50%) of any Assignment Profit or
Sublease Profit, as the case may be.  It
is understood and agreed that in the event that pursuant to 

 

40

 

Section 7.07 hereof, Landlord or Landlord’s
designee shall sublet all or any portion of the Premises, then the amount of
any Sublease Profit due and payable to Landlord hereunder shall, at Landlord’s
option, be credited against the amount of rent payable under such sublease.

 

(b)           For
purposes of this Section 7.14, the term “Assignment Profit” shall mean an
amount equal to all sums and other considerations paid to Tenant by the
assignee for or by reason of such assignment (including, but not limited to,
sums paid for the sale or rental of Tenant’s fixtures, leasehold improvements,
equipment, furniture, furnishings or other personal property, less, in the case
of a sale thereof, the excess, if any of (x) the then net unamortized or
undepreciated cost thereof determined on the basis of Tenant’s federal income
tax returns) over (y) the unamortized amount of the Work Allowance (determined
on a straight line basis over the term of the lease), after deducting therefrom
the amount of “Tenant’s Costs”, as hereinafter defined.

 

(c)                                  For purposes of this Section 7.14, the
term “Sublease Profit” shall mean in any year of the term of this lease (i) any
rents, additional charges or other consideration payable under the sublease to
Tenant by the subtenant which is in excess of the Fixed Rent and Additional
Charges accruing during such year of the term of this lease in respect of the
subleased space (at the rate per square foot payable by Tenant hereunder)
pursuant to the terms hereof, and (ii) all sums paid for the sale or rental of
Tenant’s fixtures, leasehold improvements, equipment, furniture or other
personal property, less, in the case of the sale thereof, the excess, if any,
of (x) the then net unamortized or undepreciated cost thereof determined
on the basis of Tenant’s federal income tax returns, over (y) the unamortized
amount of the Work Allowance allocable, on a per rentable square foot basis, to
the sublet space (determined on a straight line basis over the term of the
lease), which net unamortized amount shall be deducted from the sums paid in
connection with such sale in equal monthly installments over the balance of the
term of the sublease (each such monthly deduction to be in an amount equal to
the quotient of the net unamortized amount, divided by the number of months
remaining in the term of this lease) after deducting therefrom (except in the
case of a sublease to Landlord or Landlord’s designee pursuant to Section 7.07
hereof) the amount of Tenant’s Costs, as hereinafter defined.  The sums payable under this Section 7.14

 

41

 

shall be paid to Landlord as and when paid by
the subtenant to Tenant.

 

(d)                                 For purposes hereof, the term
“Tenant’s Costs” shall mean:

 

(i)                                     the amount of any commercially reasonable
broker’s fee or commissions paid to a broker as a result of any subletting or
assignment by Tenant hereunder and reasonable counsel fees and disbursements
incurred with respect to such subletting or assignment;

 

(ii)                                  the cost to Tenant allocable on a per
rentable square foot basis to the space in question, of any additional
improvements (other than any work performed by or on behalf of Tenant to
prepare such space for initial occupancy), made to prepare the space in
question for the occupancy of the subtenant or assignee thereof or the dollar
amount of any rent credits or work allowance given in lieu thereof; and

 

(iii)                               commercially reasonable advertising;
and marketing expenses directly related to the subletting or assignment of the
space.

 

For the purposes of computing “Assignment
Profit” and “Sublease Profit”, Tenant’s Costs with respect thereto shall be
amortized on a straight-line basis over respectively (x) the balance of the
term of the lease from and after the effective date of such assignment, and (y)
the term of the sublease.

 

7.15.                        If Landlord shall exercise its rights
pursuant to Section 7.07 hereof to terminate this Lease or to have the Lease
assigned to it, or its designee, Landlord shall pay to Tenant an amount equal
to the product of (i) fifty percent (50%), multiplied by (ii) the Potential
Assignment Profit or Potential Sublease Profit (as those terms are hereinafter
defined), as the case may be.  The sums
payable under this Section 7.15(a) shall be paid to Tenant as and when they would
have been received by Tenant if Landlord had consented to the proposed
assignment or sublease.  The term
“Potential Assignment Profit” shall mean the Assignment Profit that Tenant
would have received pursuant to a proposed assignment of this Lease if Landlord
had not exercised its rights pursuant to Section 7.07 hereof to terminate this
Lease or have the Lease assigned to it, or its designee.  The term 

 

42

 

“Potential Sublease Profit” shall mean the
Sublease Profit that Tenant would have received pursuant to a proposed sublease
of all of the Premises if Landlord had not exercised its rights pursuant to
Section 7.07 to terminate this Lease or to have the Lease assigned to it, or
its designee.

 

7.16.                        Except for any subletting by Tenant to
Landlord or its designee pursuant to the provisions of Section 7.10
hereof, each subletting shall be subject to all of the covenants, agreements
terms, provisions and conditions contained in this lease.  Notwithstanding any such subletting to
Landlord or any such subletting to any other subtenant and/or acceptance of
rent or additional rent by Landlord from any subtenant, Tenant shall and will
remain fully liable for the payment of the Fixed Rent and Additional Charges
due and to become due hereunder and for the performance of all the covenants,
agreements, terms, provisions and conditions contained in this lease on the
part of Tenant to be performed and all acts and omissions of any licensee or
subtenant or anyone claiming under or through any subtenant which shall be in
violation of any of the obligations of this lease, and any such violation shall
be deemed to be a violation by Tenant subject, however, to all provisions under
the lease with respect to Tenant’s rights of notice and opportunity to cure,
and to the conditions set forth in Section 35.04 hereof.  Tenant further agrees that notwithstanding
any such subletting, no other and further subletting of the Premises by Tenant
or any person claiming through or under Tenant (except as provided in Section
7.10) shall or will be made except upon compliance with and subject to the
provisions of this article.  If Landlord
shall decline to give its consent to any proposed assignment or sublease, or if
Landlord shall exercise any of its options under Section 7.07, Tenant shall
indemnify, defend and hold harmless Landlord against and from any and all loss,
liability, damages, costs and expenses (including reasonable counsel fees)
resulting from any claims that may be made against Landlord (x) by the proposed
assignee or sublessee or (y) by any brokers or other persons claiming a
commission or similar compensation in connection with the proposed assignment
or sublease by reason of the acts, negotiations or conversations of Tenant or its
proposed assignee or sublessee, as the case may be.

 

7.17.                        (a)           If
Tenant is a partnership (or is comprised of two (2) or more persons,
individually and/or as co-partners of a partnership) or if Tenant’s interest in
this lease shall be assigned to a partnership (or to two (2) or 

 

43

 

more persons, individually and/or as
co-partners of a partnership) pursuant to this article (any such partnership
and such persons are referred to in this section as ‘Partnership Tenant”), the
following provisions of this section shall apply to such Partnership Tenant:
(a) the liability of each of the parties comprising Partnership Tenant shall be
joint and several, (b) each of the parties comprising Partnership Tenant hereby
consents in advance to, and agrees to be bound by, any written instrument which
may hereafter be executed, changing, modifying or discharging this lease, in
whole or in part, or surrendering all or any part of the Premises to Landlord
or renewing or extending this lease and by any notices, demands, requests or
other communications which may hereafter be given, by Partnership Tenant or by
any of the parties comprising Partnership Tenant, (c) any bills, statements,
notices, demands, requests or other communications given or rendered to
Partnership Tenant or to any of the parties comprising Partnership Tenant shall
be deemed given or rendered to Partnership Tenant and to all such parties and
shall be binding upon Partnership Tenant and all such parties, (d) if Partnership
Tenant shall admit new partners, all of such new partners shall, by their
admission to Partnership Tenant, be deemed to have assumed performance of all
of the terms, covenants and conditions of this lease on Tenant’s part to be
observed and performed, (e) Partnership Tenant shall give prompt notice to
Landlord of the admission of any partner or partners, and upon demand of
Landlord, shall cause each such partner to execute and deliver to Landlord an
agreement in form satisfactory to Landlord, wherein each such new partner shall
assume performance of all of the terms, covenants and conditions of this lease
on Tenant’s part to be observed and performed (but neither Landlord’s failure
to request any such agreement nor the failure of any such new partner to
execute or deliver any such agreement to Landlord shall vitiate the provisions
of subdivision (d) of this section) and (f) on each anniversary of the
Commencement Date, Partnership Tenant shall deliver to Landlord a list of all
partners together with their current residential addresses.

 

(b)                                 If Tenant is a partnership, the
admission of new partners, the withdrawal, retirement, death, incompetency or
bankruptcy of any partner, or the reallocation of partnership interests among
the partners shall not constitute an assignment of this lease, provided the
principal purpose of any of the foregoing is not to circumvent the restrictions
on assignment set forth in the provisions of this Article 7 and provided that
the capital of the partnership is 

 

44

 

not as a result of any of the foregoing
events, reduced by more than 20% of the capital immediately prior to such
event.  The reorganization of Tenant
from a professional corporation into a partnership or the reorganization of a
Tenant from a partnership into a professional corporation, shall not constitute
an assignment of this lease, provided that immediately following such
reorganization the partners of Tenant shall be the same as the shareholders of
Tenant existing immediately prior to such reorganization, or the shareholders
of Tenant shall be the same as the partners of Tenant existing immediately
prior to such reorganization, as the case may be. If Tenant shall become a
professional corporation, each individual shareholder in Tenant and each
professional employee of a professional corporation which is a shareholder in
Tenant shall have the same personal liability as such individual or
shareholder-employee would have under this lease if Tenant were a partnership
and such individual or shareholder-employee were a partner in Tenant.  If any individual partner in Tenant is or
becomes a shareholder-employee of a professional corporation, such individual
shall have the same personal liability under this lease as such individual
would have if he and not the professional corporation were a partner of Tenant.

 

ARTICLE 8

 

Compliance with Laws

 

8.01.                        (a)           Tenant
shall give prompt notice to Landlord of any notice it receives of the violation
of any law or requirement of any public authority with respect to the Premises
or the use or occupation thereof. 
Tenant shall (a) at Tenant’s expense, comply with all present and future
laws and requirements of any public authorities in respect of the Premises or
the use and occupation thereof, or the abatement of any nuisance in, on or
about the Premises including, without limitation, those applicable to the
making of any Alterations therein or which apply as a result of the making
thereof, except that Tenant shall not be under any obligation to make any
structural Alteration in order to comply with any law or requirement of any
public authority applicable to the mere general “office” use (as opposed to the
manner of use) of the Premises, unless otherwise expressly required herein, or
if the same is applicable to the making of an Alteration or applies as a result
of the making thereof; and (b) be responsible for the cost of compliance with
all present and 

 

45

 

future laws and requirements of any public
authorities in respect of the Real Property to the extent arising from (i)
Tenant’s manner of use of the Premises (other than mere general office use),
(ii) the manner of conduct of Tenant’s business or operation of its
installations, equipment or other property therein, (iii) any cause or
condition created by or at the instance of Tenant, or (iv) the breach of any of
Tenant’s obligations hereunder, whether or not such compliance requires work
which is structural or non-structural, ordinary or extraordinary, foreseen or
unforeseen.  Tenant shall pay all the
costs, expenses, fines, penalties and damages which may be imposed upon
Landlord or any Superior Lessor by reason of or arising out of Tenant’s failure
to fully and promptly comply with and observe the provisions of this Section
8.01.  Without limiting the generality
of the foregoing, it is specifically agreed that Tenant shall comply with all
laws that require the installation, modification or maintenance within the
Premises of (i) any fire-rated partitions, gas, smoke, or fire detector or
alarm, any emergency signage or lighting system, or any sprinkler or other
system to extinguish fires or (ii) any handicap facilities.  However, Tenant need not comply with any
such law or requirement of any public authority so long as Tenant shall be
contesting the validity thereof, or the applicability thereof to the Premises,
in accordance with Section 8.02 hereof. 
Landlord, at its expense, shall comply with all other such laws and
requirements of public authorities as shall affect the Premises, but may
similarly defer compliance so long as Landlord shall be contesting the validity
or applicability thereof but only to the extent that deferral of compliance and
contest of the legal requirements does not materially impair Tenant’s ability
to conduct business in the Premises in its customary manner, and does not
create an imminent hazard to life and limb. 
Landlord represents that on the date hereof, to the best of Landlord’s
knowledge, Landlord has received no notice of violation from any governmental
authority having jurisdiction thereof, of any violation of law existing in the
Premises which has not been cured. 
Without limiting the generality of the foregoing, it is agreed that
Landlord shall comply, at Landlord’s expense, with all present laws and
requirements of public authorities, which require the removal, encapsulation
and/or other remedial treatment of asbestos in the Premises except that
Landlord shall not be obligated to so comply with respect to any asbestos
brought into the Premises by Tenant, its contractors, materialmen, agents or
any assignee or subtenants of Tenant (other than Landlord) or their respective
contractors, materialmen or agents.

 

46

 

(b)                                 Notwithstanding anything to the
contrary in this Lease, Tenant shall be responsible for the cost of all present
and future compliance with the Disabilities Act in the Premises.  Tenant shall be responsible for the cost of
compliance with the Act, if such compliance shall require the making of
alterations outside the Premises, and regardless whether the Disabilities Act
shall impose the primary obligation for such compliance on Landlord or Tenant,
but only to the extent that the requirement for such compliance arises from the
performance of any alteration or installation made by or on behalf of Tenant
within the Premises or outside the Premises.

 

8.02.                        Tenant, at its expense, after notice
to Landlord, may contest, by appropriate proceedings prosecuted diligently and
in good faith, the validity, or applicability to the Premises, of any law or
requirement of any public authority, provided that (a) Landlord shall not be
subject to criminal penalty or to prosecution for a crime, or any other fine or
charge, nor shall the Premises or any part thereof or the Building or Land, or
any part thereof, be subject to being condemned or vacated, nor shall the
Building or Land, or any part thereof, be subjected to any lien or encumbrance,
by reason of non-compliance or otherwise by reason of such contest; (b) before
the commencement of such contest, Tenant shall furnish to Landlord the bond of
a surety reasonably satisfactory to Landlord, a cash deposit or other security
in amount, form and substance satisfactory to Landlord and shall indemnify
Landlord against the cost thereof and against all liability for damages,
interest, penalties and expenses (including reasonable attorneys fees and
expenses), resulting from or incurred in connection with such contest or
non-compliance; (c) such non-compliance or contest shall not constitute or
result in any violation of any Superior Mortgage, or if any such Superior
Mortgage shall permit such non-compliance or contest on condition of the taking
of action or furnishing of security by Landlord, such action shall be taken and
such security shall be furnished at the expense of Tenant; (d) such
noncompliance or contest shall not prevent Landlord from obtaining any and all
permits and licenses in connection with the operation of the Building; (e)
Tenant shall keep Landlord advised as to the status of such proceedings; and
(f) deferral of compliance and contest of the legal requirement does not
materially impair the ability of other tenants or of Landlord to conduct
business in their respective premises or in the Building, as the case may be,
in 

 

47

 

their customary manner, and does not create
an imminent hazard to life or limb. 
Without limiting the application of the above, Landlord shall be deemed
subject to prosecution for a crime if Landlord, or its managing agent, or any
officer, director, partner, shareholder, or employee of Landlord or its
managing agent, as an individual, is charged with a crime of any kind or degree
whatever, whether by service of a summons or otherwise, unless such charge is
withdrawn before Landlord or its managing agent, or such officer, director,
partner, shareholder or employee of Landlord or its managing agent (as the case
may be) is required to plead or answer thereto.

 

ARTICLE 9

 

Insurance

 

9.01.                        Tenant shall not violate, or permit
the violation of, any condition imposed by any insurance policy then issued in
respect of the Real Property and shall not do, or permit anything to be done,
or keep or permit anything to be kept in the Premises which would subject
Landlord, any Superior Lessor or any Superior Mortgagee to any liability or
responsibility for personal injury or death or property damage, or which would
increase any insurance rate in respect of the Real Property over the rate which
would otherwise then be in effect or which would result in insurance companies
of good standing refusing to insure the Real Property in amounts reasonably
satisfactory to Landlord, or which would result in the cancellation of or the
assertion of any defense by the insurer in whole or in part to claims under any
policy of insurance in respect of the Real Property.

 

9.02.                        If, by reason of any failure of Tenant
to comply with the provisions of this lease, the premiums on Landlord’s insurance
on the Real Property shall be higher than they otherwise would be, Tenant shall
reimburse Landlord as Additional Charges within twenty (20) days of
Landlord’s request thereof or accompanied by reasonable documentation
evidencing such increase in premiums, for that part of such premiums
attributable to such failure on the part of Tenant.  A schedule or “make up” of rates for the Real Property or the
Premises, as the case may be, issued by the New York Fire Insurance Rating
Organization or other similar body making rates for insurance for the Real
Property or the Premises, as the case may be, shall be conclusive evidence of
the facts therein stated and of the several items and charges in the 

 

48

 

insurance rate then applicable to the Real
Property or the Premises, as the case may be.

 

9.03.                        (a)           Tenant,
at its expense, shall maintain at all times during the term of this lease (i)
“all risk” property insurance covering all present and future Tenant’s Property
and leasehold improvements to a limit of not less than the full replacement
value thereof, such insurance to include a replacement cost endorsement, and
(ii) comprehensive general liability insurance, including contractual
liability, in respect of the Premises and the conduct or operation of business
therein, with Landlord and its managing agent, if any, and each Superior Lessor
and Superior Mortgagee whose name and address shall previously have been
furnished to Tenant, as additional insureds, with limits of not less than Five
Million ($5,000,000) Dollars combined single limit for bodily injury and
property damage liability in any one occurrence, (iii) steam boiler,
air-conditioning or machinery insurance, if there is a boiler or pressure
object or similar equipment in the Premises, with Landlord and its managing
agent, if any, and each Superior Lessor and Superior Mortgagee whose name and
address shall previously have been furnished to Tenant, as additional insureds,
with limits of not less than Five Million ($5,000,000) Dollars and (iv) when
Alterations are in progress, the insurance specified in Section 11.05
hereof.  Subject to the provisions of
Section 9.04 hereof, the limits of such insurance shall not limit the liability
of Tenant.  Tenant shall deliver to
Landlord and any additional insureds, at least ten (10) days prior to the
Commencement Date, such fully paid-for policies or certificates of insurance,
in form reasonably satisfactory to Landlord issued by the insurance company or
its authorized agent.  Tenant shall
procure and pay for renewals of such insurance from time to time before the
expiration thereof, and Tenant shall deliver to Landlord and any additional
insureds such renewal policy or a certificate thereof at least thirty (30) days
before the expiration of any existing policy. 
All such policies shall be issued by companies of recognized
responsibility licensed to do business in New York State and rated by Best’s
Insurance Reports or any successor publication of comparable standing and carrying
a rating of A VIII or better or the then equivalent of such rating, and all
such policies shall contain a provision whereby the same cannot be cancelled or
modified unless Landlord and any additional insureds are given at least thirty
(30) days prior written notice of such cancellation or modification. The
proceeds of policies providing “all risk” property insurance of Tenant’s 

 

49

 

Property and improvements and betterments
shall be payable to Landlord, Tenant and each Superior Lessor and Superior
Mortgagee as their interests may appear. 
Tenant shall cooperate with Landlord in connection with the collection
of any insurance monies that may be due in the event of loss and Tenant shall
execute and deliver to Landlord such proofs of loss and other instruments which
may be reasonably required to recover any such insurance monies.

 

(b)                                 Landlord shall maintain with respect
to the Building at all times during the term of this lease, liability and
casualty insurance, in each case with such limits not less than that required
by either (x) the bona fide, third-party holder of the first mortgage on the
Building or (y) if no such mortgagee exists, third party mortgagees of
comparable first-class office buildings in the Borough of Manhattan.

 

9.04.                        Each party shall include in each of
its insurance policies (insuring the Building in case of Landlord, and insuring
Tenant’s Property (hereinafter defined) and leasehold improvements in the case
of Tenant, against loss, damage or destruction by fire or other casualty) a
waiver of the insurer’s right of subrogation against the other party during the
term of this lease or, if such waiver should be unobtainable or unenforceable,
(i) an express agreement that such policy shall not be invalidated if the
assured waives the right of recovery against any party responsible for a
casualty covered by the policy before the casualty or (ii) any other form of
permission for the release of the other party. 
If such waiver, agreement or permission shall not be, or shall cease to
be, obtainable from either party’s then current insurance company, the insured
party shall so notify the other party promptly after learning thereof, and
shall use its best efforts to obtain the same from another insurance company
described in Section 9.03 hereof.  Each
party hereby releases the other party, with respect to any claim (including a
claim for negligence) which it might otherwise have against the other party,
for loss, damage or destruction with respect to its property occurring during
the term of this lease to the extent to which it is, or is required to be,
insured under the aforementioned property or all risk insurance policy or
policies containing a waiver of subrogation or permission to release liability,
as provided in the preceding subdivisions of this Section.

 

9.05.                        Landlord may from time to time require
that the amount of the insurance to be maintained by Tenant 

 

50

 

under Section 9.03 hereof be increased, so
that the amount thereof adequately protects Landlord’s interest.

 

ARTICLE 10

 

Rules and Regulations

 

10.01.                  Tenant and its employees and agents
shall observe and comply with the rules and regulations annexed hereto as Exhibit
D, and such reasonable changes therein (whether by modification,
elimination or addition) as Landlord at any time or times hereafter may make
and communicate to Tenant, which, in Landlord’s reasonable judgment, shall be
necessary for the reputation, safety, care and appearance of the Real Property,
or the preservation of good order therein, or the operation or maintenance of
the Real Property, and which do not unreasonably affect the conduct of Tenant’s
business in the Premises (such rules and regulations as changed from time to
time being herein called “Rules and Regulations”), subject to Tenant’s right to
dispute the reasonableness of any Rule or Regulation as hereinafter set forth;
provided, however, that in case of any conflict or inconsistency between the
provisions of this lease and any of the Rules and Regulations, the provisions
of this lease shall control.  Landlord
agrees that it shall not enforce or fail to enforce the rules and regulations
so as to apply the same against Tenant in an adversely discriminatory manner.

 

10.02.                  Tenant shall have the right to dispute
the reasonableness of any additional Rule or Regulation hereafter adopted by
Landlord.  If Tenant disputes the
reasonableness of any additional Rule or Regulation hereafter adopted by
Landlord, the dispute shall be determined by arbitration in the City of New
York in accordance with the rules and regulations then obtaining of the
American Arbitration Association (or any organization which is the successor
thereto).  Any such determination shall
be final and conclusive upon the parties hereto.  The right to dispute the reasonableness of any additional Rule or
Regulation upon Tenant’s part shall be deemed waived unless the same shall be
asserted by service of a notice upon Landlord within thirty (30) days after receipt
by Tenant of notice of the adoption of any such additional Rule or Regulation.

 

51

 

10.03.                  Nothing in this lease contained shall
be construed to impose upon Landlord any duty or obligation to enforce the
Rules and Regulations against Tenant or any other tenant or any employees or
agents of Tenant or any other tenant, and Landlord shall not be liable to
Tenant for violation of the Rules and Regulations by another tenant or its
employees, agents, invitees or licensees.

 

ARTICLE 11

 

Alterations

 

11.01.                  Except as set forth in Section 11.11
hereof, Tenant shall make no improvements, changes or alterations (other than
decorations) in or to the Premises (herein called “Alterations”) of any nature
without Landlord’s prior written approval. 
However, provided Tenant shall be in compliance with the applicable
provisions of this Article 11 and is not in default under this lease, Tenant
may, at its sole expense, upon obtaining Landlord’s written approval, which
approval shall not be unreasonably withheld, undertake Alterations which are
not Material Alterations.  A “Material
Alteration” is an Alteration which (a) is not limited to the interior of the
Premises or which affects the exterior (including the appearance) of the
Building, (b) is structural or affects the strength of the Building, (c)
affects the proper functioning of the mechanical, gas, electrical, sanitary,
heating, ventilating, air-conditioning, elevator, plumbing, life-safety or
other service systems of the Building (herein collectively called “Building
Systems”), (d) affects the Certificate of Occupancy for the Building or the
Premises, or (e) requires the consent of any Superior Mortgagee or
Superior Lessor and such consent shall be withheld.

 

11.02.                  (a)                                  Before proceeding with any Alteration,
Tenant shall submit to Landlord, for Landlord’s approval, plans and
specifications for the work to be done, and Tenant shall not proceed with such
work until it obtains Landlord’s written approval of such plans and specifications,
which in the case of Alterations which are not Material Alterations shall not
be unreasonably withheld or delayed.

 

(b)                                 Tenant shall pay to Landlord within
twenty (20) days after demand, as Additional Charges, Landlord’s reasonable,
actual out of pocket costs and expenses (including, without limitation, the
fees of any architect or 

 

52

 

engineer reasonably employed by Landlord or
any Superior Mortgagee for such purpose) for (i) reviewing said plans and
specifications and (ii) inspecting the Alterations to determine whether the
same are being performed in accordance with the approved plans and
specifications, the provisions of any Superior Lease or Superior Mortgage and
all laws and requirements of public authorities.

 

(c)                                  Tenant agrees that any review or
approval by Landlord of any plans and/or specifications with respect to any
Alterations is solely for Landlord’s benefit, and without any representation or
warranty whatsoever to Tenant with respect to the adequacy, correctness or
efficiency thereof or otherwise.

 

11.03.                  (a)                                Before proceeding with any Alteration
which will cost more than Two Hundred Fifty Thousand ($250,000) Dollars
(exclusive of the costs of decorating work and items constituting Tenant’s
Property), as estimated by a reputable contractor reasonably designated by
Landlord, Tenant shall furnish to Landlord one of the following (as selected by
Landlord) a cash deposit or a performance bond and a labor and materials
payment bond (issued by a corporate surety licensed to do business in New York
reasonably satisfactory to Landlord), in an amount equal to one hundred twenty
(120%) percent of the cost of the Alteration, estimated as set forth above.

 

(b)                                 Upon (i) the completion of the Alteration
in accordance with the terms of this Article 11 and (ii) the submission to
Landlord of proof evidencing the payment in full for said Alteration, the
security deposited with Landlord (or the balance of the proceeds thereof, if
Tenant has furnished cash or a letter of credit and if Landlord has drawn on
the same) shall be returned to Tenant.

 

(c)                                  Upon Tenant’s failure to properly
perform, complete and fully pay (subject to Tenant’s rights hereunder to
contest in good faith amounts in dispute) for the said Alteration, by Landlord,
Landlord shall be entitled to draw on the security deposited under this Article
11 to the extent Landlord reasonably deems necessary in connection with the
said Alteration, the restoration and/or protection of the Premises or the Real
Property and the payment or satisfaction of any costs, damages or expenses in
connection with the foregoing and/or Tenant’s obligations under this Article
11.

 

53

 

11.04.                  Tenant, in connection with any
Alterations, shall fully and promptly comply with and observe the Alterations
Rules and Regulations set forth as Exhibit E hereto and made a part
hereof.

 

11.05.                  Tenant, at its expense shall obtain
(and furnish true and complete copies to Landlord of) all necessary
governmental permits and certificates for the commencement and prosecution of
Alterations and for final approval thereof upon completion, and shall cause
Alterations to be performed in compliance therewith, with all applicable laws
and requirements of public authorities, with all applicable requirements of
insurance bodies and with the plans and specifications approved by
Landlord.  Alterations shall be
diligently performed in a good and workmanlike manner, using new materials and
equipment of a quality and class reasonably acceptable to Landlord.  Alterations shall be performed by
contractors first approved by Landlord. 
Prior to making an Alteration, at Tenant’s written request, Landlord
shall furnish Tenant with a list of contractors who may perform Alterations to
the Premises on behalf of Tenant.  If
Tenant engages any contractor set forth on the list, Tenant shall not be
required to obtain Landlord’s consent for such contractor unless, prior to the
earlier of (a) entering into a contract with such contractor, or (b) the
commencement of work by such contractor, Landlord shall notify Tenant that such
contractor has been removed from the list. 
Notwithstanding the foregoing, with respect to any Alteration affecting
any Building System (i)  Tenant shall
select a contractor from a list of approved contractors furnished by Landlord
to Tenant (containing at least three (3) contractors) except for an Alteration
to the Building’s life safety system for which Tenant shall use the contractor
designated therefor by Landlord, and (ii) the Alteration shall, at Tenant’s
cost and expense, be designed by Landlord’s engineer for the relevant Building
System.  Alterations shall be performed
in a manner calculated not to unreasonably interfere with or delay and as not
to impose any additional expense upon Landlord in the construction,
maintenance, repair or operation of the Building; and if any such additional
expense shall be incurred by Landlord as a result of Tenant’s performance of
any Alterations, Tenant shall pay such additional expense upon demand as
Additional Charges.  Throughout the
performance of Alterations, Tenant, at its expense, shall carry, or cause to be
carried, worker’s compensation insurance in statutory limits, all risk
“Builders Risk” insurance and general liability insurance, with completed
operation endorsement, 

 

54

 

under which Landlord and its agent and any
Superior Lessor and Superior Mortgagee whose name and address shall previously
have been furnished to Tenant shall be named as parties insured, in such limits
as Landlord may reasonably require, with an insurer qualifying under subsection
9.03(a) hereof.  Tenant shall furnish
Landlord with reasonably satisfactory evidence that such insurance is in effect
at or before the commencement of Alterations and, on request, at reasonable
intervals thereafter during the continuance of Alterations.  No Alterations shall involve the removal of
any fixtures, equipment or other property in the Premises which are not
Tenant’s Property without Landlord’s prior written consent, unless such
fixtures, equipment or other property shall be promptly replaced at Tenant’s
expense with new fixtures, equipment or other property of like utility and at
least equal value in which case Landlord’s consent shall not be unreasonably
withheld or delayed.

 

11.06.                  Tenant agrees that the exercise of its
rights pursuant to the provisions of Article 11 or of any other provisions of
this lease or the Exhibits hereto shall not be done in a manner which would
violate Landlord’s union contracts affecting the Real Property, or create any
work stoppage, picketing, labor disruption or dispute or disharmony or any
interference with the business of Landlord or any tenant or occupant of the
Building.  Tenant shall immediately stop
work or other activity if Landlord notifies Tenant that continuing such work or
activity would violate Landlord’s union contracts affecting the Real Property,
or create any work stoppage, picketing, labor disruption or dispute or
disharmony or any interference with the business of Landlord or any tenant or
occupant of the Building.

 

11.07.                  Tenant, at its expense, and with
diligence and dispatch, shall procure the cancellation or discharge of all
notices of violation arising from or otherwise connected with Alterations, or
any other work, labor, services or materials done for or supplied to Tenant, or
any person claiming through or under Tenant, which shall be issued by the
Department of Buildings of the City of New York or any other public authority
having or asserting jurisdiction. 
Tenant shall defend, indemnify and save harmless Landlord from and
against any and all mechanic’s and other liens and encumbrances filed in connection
with Alterations, or any other work, labor, services or materials done for or
supplied to Tenant, or any person, subtenant or licensee of Tenant or any other
person authorized by Tenant, including, without 

 

55

 

limitation, security interests in any
materials, fixtures or articles so installed in and constituting part of the
Premises and against all costs, expenses and liabilities incurred in connection
with any such lien or encumbrance or any action or proceeding brought thereon
other than consequential damages in connection therewith.  Tenant, at its expense, shall procure the
satisfaction or discharge of record of all such liens and encumbrances within
twenty (20) days after Tenant shall have received notice thereof (or such
shorter period if required by the terms of any Superior Lease or Superior
Mortgage).  However, nothing herein
contained shall prevent Tenant from contesting, in good faith and at its own
expense, any notice of violation, provided that Tenant shall comply with the
provisions of Section 8.02 hereof; provided, however, that the foregoing
provisions of this sentence shall not obviate the need for such satisfaction or
discharge of record.

 

11.08.                  Tenant will promptly upon the
completion of an Alteration deliver to Landlord “as-built” drawings of any
Alterations Tenant has performed or caused to be performed in the Premises, and
if any Alterations for Tenant were performed by Landlord, the “as-built”
drawings, if any, or the drawings and specifications, if any, as the case may be,
for such Alterations, in Tenant’s possession.

 

11.09.                  All fixtures and equipment installed
or used by Tenant in the Premises shall be fully paid for by Tenant in cash and
shall not be subject to conditional bills of sale, chattel mortgage or other
title retention agreements.  Tenant
shall promptly pay the cost of all alterations or repairs for which Tenant is
responsible under the terms of this lease and Tenant, at its expense, shall
procure the discharge of any liens filed in connection with any repairs or
Alterations, including, without limitation, the liens of any conditional sales,
or chattel mortgages, title retention agreements, security agreements or
financing statements, upon, and any materials or fixtures installed in
constituting part of the Premises within twenty (20) days after the filing
thereof against the Premises, the Building or the Real Property; provided,
however, that Tenant shall have the right to contest, in good faith and with
reasonable diligence, the validity of any lien or claimed lien if Tenant shall
give to Landlord such security as may be reasonably satisfactory to Landlord
and Landlord’s title insurance company to insure payment thereof and any
interest thereon and to prevent any foreclosure of the lien or sale of said
property, the Premises, the Building or the Real Property by reason of 

 

56

 

nonpayment thereof; provided, however, that
on final determination of the lien or claim for lien, Tenant shall immediately
pay any judgment rendered, with all proper costs and charges, shall have the
lien released and any judgment satisfied.

 

11.10.                  Tenant shall keep records of Tenant’s
Alterations costing in excess of $5,000 and of the cost thereof.  Tenant shall, within forty-five (45) days
after demand by Landlord, furnish to Landlord copies of such records and cost
if Landlord shall require same in connection with any proceeding to reduce the
assessed valuation of the Real Property, or in connection with any proceeding
instituted pursuant to Article 8 hereof or for any other reason or purpose.

 

11.11.                  Notwithstanding anything contained in
this lease to the contrary, Landlord’s consent shall not be required with
respect to any non-structural Alteration, provided that (a) consent for such
Alteration is not required under the terms of any Superior Lease or Superior
Mortgage, and (b) such Alteration (i) is not visible from the outside of the
Building, (ii) does not affect any part of the Building other than the
Premises, (iii) does not affect any service required to be furnished by
Landlord to any other tenant or occupant of the Building, (iv) does not
affect the usage or proper functioning of any Building System, (v) does not
impair or diminish the value or utility of the Building, (vi) does not affect
or violate the provisions of the Certificate of Occupancy for the Building or
the Premises, (vii) does not require that any plans or specifications be filed
with, or any permit to be obtained from, the New York City Buildings
Department, and (viii) the estimated cost of the labor and materials for which
shall not exceed Fifty Thousand Dollars ($50,000), either individually or in
the aggregate with other non-structural Alterations constructed within any
twelve (12) month period; provided, however, that at least ten (10) days prior
to making any such non-structural Alteration, Tenant shall submit to Landlord
for informational purposes only the detailed plans and specifications for such
Alteration, as required by subsection 11.02(a) hereof, and any such Alteration
shall otherwise be performed in compliance with the provisions of this Article
11.

 

11.12.                  Landlord agrees that Tenant shall have
the right to erect a sign with its logo on its entrance to the Premises,
subject to Landlord’s approval of the size, material 

 

57

 

and design of such sign, which approval shall
not be unreasonably withheld or delayed.

 

ARTICLE 12

 

Landlord’s and Tenant’s Property

 

12.01.                  All fixtures, equipment, improvements
and appurtenances attached to or built into the Premises at the commencement of
or during the term of this lease, whether or not by or at the expense of
Tenant, shall be and remain a part of the Premises, shall, upon the expiration
or sooner termination of this lease, be deemed the property of Landlord and
shall not be removed by Tenant, except as provided in Section 12.02.  Further, any carpeting or other personal
property in the Premises on the Commencement Date, unless installed and paid
for by Tenant, shall be and shall remain Landlord’s property and shall not be
removed by Tenant.  Notwithstanding the
foregoing provisions, upon notice to Tenant no later than thirty (30) days
prior to the Expiration Date or upon reasonable notice with respect to such
earlier date upon which the term of this lease shall expire, Landlord may
require Tenant to remove, at Tenant’s cost and expense, any Specialty
Alterations (as herein defined) installed on or after the date hereof by or on
behalf of Tenant or anyone claiming by through or under Tenant and to repair
and restore the Premises to the condition existing prior to the making of said
Specialty Alterations and repair any damage to the Premises or the Building due
to such removal, unless if at the time Tenant requested Landlord’s consent to
the installation of the Specialty Alterations, Tenant requested Landlord to
advise Tenant whether Landlord would require the removal of such Specialty
Alterations and Landlord then advised Tenant that it would not require such
removal.  For the purposes hereof,
“Specialty Alterations” shall mean Alterations consisting of kitchens,
executive bathrooms, raised computer floors, computer installations, vaults,
libraries, internal staircases, dumbwaiters, pneumatic tubes, vertical and
horizontal transportation systems, and other Alterations of a similar character
which are not Building-Standard in nature.

 

12.02.                  All movable partitions, business and
trade fixtures, machinery and equipment, communications equipment and office
equipment, whether or not attached to or built into the Premises, which are
installed in the Premises by or for the account of Tenant without expense to
Landlord and can be

 

58

 

removed without structural
damage to the Building, and all furniture, furnishings and other articles of
movable personal property owned by Tenant and located in the Premises (herein
collectively called “Tenant’s Property”) shall be and shall remain the property
of Tenant and may be removed by Tenant at any time during the term of this
lease; provided that if any of Tenant’s Property is removed, Tenant shall
repair or pay the cost of repairing any damage to the Premises or to the
Building resulting from the installation and/or removal thereof other than damage
resulting from any negligent act or omission of Landlord, its employees, agents
or contractors.  Any equipment or other
property for which Landlord shall have granted any allowance or credit to
Tenant shall not be deemed to have been installed by or for the account of
Tenant without expense to Landlord, shall not be considered Tenant’s Property
and shall be deemed the property of Landlord.

 

12.03.                  At or before the Expiration Date of
this lease (or within 15 days after any earlier termination of this lease)
Tenant, at its expense, shall remove from the Premises all of Tenant’s Property
(except such items thereof as Landlord shall have expressly permitted to
remain, which property shall become the property of Landlord), and Tenant shall
repair any damage to the Premises or the Building resulting from any
installation and/or removal of Tenant’s Property.

 

12.04.                  Any other items of Tenant’s Property
which shall remain in the Premises after the Expiration Date of this lease, or
within 15 days following an earlier termination date, may at the option of
Landlord, be deemed to have been abandoned, and in such case such items may be
retained by Landlord as its property or disposed of by Landlord, without
accountability, in such manner as Landlord shall determine, at Tenant’s
expense.

 

ARTICLE 13

 

Repairs and Maintenance

 

13.01.                  Landlord shall operate, maintain and
make all necessary repairs (both structural and nonstructural) to the part of
the Building Systems which provide service to the Premises (but not to the distribution
portions of such Building Systems located within the Premises) and, except
where the same shall be Tenant’s responsibility hereunder, the

 

59

 

structural portions of the
Building, both exterior and interior, in conformance with standards applicable
to non-institutional first-class office buildings in Manhattan.  Tenant shall, at its expense, throughout the
term of this lease, take good care of and maintain in good order and condition
the Premises and the fixtures and improvements therein including, without
limitation, the property which is deemed Landlord’s pursuant to Section 12.01
hereof and Tenant’s Property; provided, however, Tenant shall not be
responsible to make any repairs which (i) are Landlord’s express obligation
hereunder or (ii) from which Tenant has been expressly excused hereunder.  Tenant shall be responsible for all
non-structural repairs, interior and exterior, ordinary and extraordinary, foreseen
or unforeseen, in and to the Premises, except for reasonable wear and tear,
obsolescence and damage for which Tenant is not responsible pursuant to the
provisions of Article 19 hereof. 
Notwithstanding the foregoing, Tenant shall be responsible for the cost
of all repairs, interior and exterior, structural and non-structural, ordinary
and extraordinary, foreseen or unforeseen, in and to the Building, the Building
facilities and the Building Systems, the need for which arises out of (a) the
performance or existence of Alterations, (b) the installation, use or operation
of property in the demised premises (c) the moving by or on behalf of Tenant of
any property, including, without limitation, Tenant’s Property in or out of the
Building, (d) the act, omission, misuse or neglect of Tenant or any of its
subtenants (other than Landlord) or its or their employees, agents, contractors
or invitees or (e) notwithstanding the foregoing, design flaws in any of
Tenant’s plans and specifications regardless of the fact that such Tenant’s
plans may have been approved by Landlord. 
Except where replacement is required as a result of any negligent act or
omission of Landlord, its employees, agents or contractors, Tenant, at its
expense, shall promptly replace all scratched, damaged or broken doors and
glass (and the solar film, if any, attached to the window glass) in and about
the Premises, including, without limitation, entrance doors and shall be
responsible for all repairs, maintenance and replacement of wall and floor
coverings in the Premises and for all the repairs, maintenance and replacement
of all horizontal portions of the Building Systems and facilities of the
Building within or exclusively serving the Premises, including without
limitation the sanitary and electrical fixtures and equipment therein but
specifically excluding perimeter heating systems.  All repairs in or to the Premises for which Tenant is responsible
shall be promptly performed by

 

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Tenant as promptly as
reasonably practicable, in a manner which will not interfere with the use of
the Building by other occupants; provided, however, any repairs in and to the
Building, the Building facilities and Building Systems for which Tenant is
responsible shall be performed by Landlord at Tenants expense; but Landlord
may, at its option, before commencing any such work or at any time thereafter,
require Tenant to furnish to Landlord such security, in form and amount as
Landlord shall deem necessary to assure the payment for such work by Tenant.  The exterior walls of the Building, the
portions of any window sills outside the windows, and the windows are not part
of the premises demised by this lease and Landlord reserves all rights to such
parts of the Building.

 

13.02.                  Upon becoming aware of the same,
Tenant shall give Landlord prompt notice of any defective condition in any
Building Systems or electrical lines located in, servicing or passing through
the Premises.  Following such notice,
Landlord shall remedy the conditions, but at the expense of Tenant to the
extent Tenant is responsible for same under the provisions of this Article 13.

 

13.03.                  Except as otherwise expressly provided
in this lease, Landlord shall have no liability to Tenant, nor shall Tenant’s
covenants and obligations under this lease be reduced or abated in any manner
whatsoever, by reason of any inconvenience, annoyance, interruption or injury
arising from Landlord’s making any repairs or changes which Landlord is
required or permitted by this lease, or required by law, to make in or to the
fixtures, equipment or appurtenances of the Building or the Premises.  Notwithstanding any language to the contrary
continued in this Section 13.03, if by reason of the making of such repairs or
changes by Landlord, (x) the Premises or any portion thereof in excess of 2,000
rentable square feet are rendered untenantable for seven (7) consecutive
Business Days or (y) any portion of the Premises which is 2,000 rentable square
feet or less are rendered untenantable for more than ten (10) consecutive Business
Days, and Tenant shall actually vacate such portion of the Premises and notify
Landlord that it has so vacated the Premises, then all Fixed Rent and
Additional Charges reserved herein shall abate after the seventh (7th) or tenth
(10th) Business Day (as the case may be) following the date the Premises, or
the applicable portion thereof, shall be rendered untenantable, in proportion
to the portion of the Premises so affected, until the condition preventing
Tenant from so occupying the

 

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Premises, or such portion
of the Premises, as the case may be, shall be remedied.

 

13.04.                  Landlord shall use its reasonable
efforts to the extent practicable to minimize interference with Tenants use and
occupancy of the Premises in making any repairs, alterations, additions or
improvements; provided, however, that Landlord shall have no obligation to
employ contractors or labor at so-called overtime or other premium pay rates or
to incur any other overtime costs or expenses whatsoever, except that Landlord,
at its expense but subject to recoupment pursuant to Article 3 hereof, shall
employ contractors or labor at so-called overtime or other premium pay rates if
necessary to make any repair required to be made by it hereunder to remedy any
condition that either (i) results in a denial of access to the Premises,
(ii) threatens the health or safety of any occupant of the Premises, or
(iii) except in the case of a fire or other casualty, materially interferes
with Tenant’s ability to conduct its business in the Premises.  In all other cases, at Tenant’s request,
Landlord shall employ contractors or labor at so-called overtime or other
premium pay rates and incur any other overtime costs or expenses in making any
repairs, alterations, additions or improvements, and Tenant shall pay to
Landlord, as additional rent, within ten (10) Business Days after demand, an
amount equal to the difference between the overtime or other premium pay rates
and the regular pay rates for such labor and any other overtime costs or
expenses so incurred.

 

ARTICLE 14

 

Electricity

 

14.01.                  Tenant agrees to purchase from
Landlord or from a meter company designated by Landlord all electricity
consumed, used or to be used in the Premises. 
The amount to be paid by Tenant for electricity consumed shall be
determined by meter or meters and related equipment installed (or, if existing,
retrofitted) by Landlord at Tenant’s expense and billed separately according to
each meter.  Bills for electricity
consumed by Tenant, which Tenant hereby agrees to pay, shall, subject to
Section 14.02 hereof, be rendered by Landlord or the meter company to Tenant at
such time as Landlord may elect, and shall be payable as an Additional Charge,
within twenty (20) days after rendition of any such bill.  Tenant shall make no material changes or
additions to

 

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the electrical equipment,
wiring and/or appliances in the Premises (beyond that on Tenant’s approved
plans for initial occupancy) without submission of plans for the prior written
consent of Landlord.

 

14.02.      (a)           The amount to be charged to Tenant by
Landlord per “KW” and “KWHR” pursuant to this Article for electricity consumed
within the Premises, whether shown on the meters measuring Tenant’s consumption
of electricity or determined by survey as herein elsewhere provided, shall be
the amount at which Landlord from time to time purchases each KW and KWHR of
electricity for the same period from the utility company, which amount (herein,
as adjusted from time to time, called “Landlord’s Rate”) shall be determined by
dividing the cost established by said utility company, as shown on the public
utility company’s invoice (averaged separately for KWs and KWHRs) during each
respective billing period by the number of KWs and KWHRs consumed by the
Building appearing on the utility company invoice for such period.  In no event shall the Additional Charge made
to Tenant pursuant to this Article for submetered electricity supplied to the
Premises (or the charge pursuant to subsection 14.04 in the event electricity
is supplied on a rent inclusion basis) be less than Landlord’s actual cost
therefor.  If Tenant shall occupy the
Premises for business purposes (including, without limitation, the testing or
operation of its computers) and consume electricity prior to the installation
of meters in the Premises, then Tenant agrees to pay Landlord the sum of $2.75
per rentable square foot per annum for electricity pursuant to subsection 14.04
until such time as said meters are installed. 
During the period of Tenant’s construction occurring prior to the
installation of said meters, Tenant will pay to Landlord a flat charge of $1.50
per rentable square foot per annum.

 

(b)                                 In addition to the charges set forth
in subsection 14.02(a) hereof, there shall be included in the computation of
Landlord’s Rate and Tenant shall pay to Landlord all surcharges, fuel
adjustments, taxes and governmental charges regularly passed on to consumers by
the utility company, and other sums payable by Landlord or required to be
collected by Landlord for the supply of electric energy to Landlord for the
Building or the redistribution thereof by Landlord.

 

14.03.                  In the event that the “submetering” of
electricity in the Building is hereafter prohibited by any law hereafter
enacted, or by any order or ruling of the Public

 

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Service Commission of the
State of New York, or by any judicial decision of any appropriate court, at the
request of Landlord, Tenant shall, unless Tenant elects to require Landlord to
provide electricity pursuant to subsection 14.04 hereof, apply within fifteen
(15) days to the appropriate public utility company servicing the Building for
direct electric service and bear all costs and expenses necessary to comply
with all rules and regulations of such public utility company pertinent
thereto, and Landlord and/or the meter company theretofore designated by
Landlord shall be relieved of any further obligation to furnish electricity to
Tenant pursuant to this Article, except Landlord shall permit its wires,
conduits and electrical equipment, to the extent available and safely capable,
to be used for such purpose.  Any
additional riser or risers or feeders or service, to the extent available and
reasonably feasible, to supply Tenant’s direct electrical requirements will be
installed by Landlord, if in Landlord’s reasonable judgment the same are
necessary and will not cause permanent damage or injury to the Building or the
Premises or cause or create a dangerous or hazardous condition or unreasonably
interfere with or disturb other tenants or occupants and the cost thereof shall
be shared equally by Landlord and Tenant. 
In addition to the installation of such riser or risers, Landlord will
also install at reasonably competitive rates all other equipment proper and
necessary in connection therewith, subject to the aforesaid terms and
conditions, and subject to Landlord’s prior approval of Tenant’s plans therefor
which shall not be unreasonably withheld or delayed and the cost thereof shall
be shared equally by Landlord and Tenant. 
Provided Tenant shall use and continue to use diligent efforts to obtain
electric energy directly from the public utility company, Landlord, to the
extent permitted by law or the requirements of public authorities shall not
discontinue furnishing electricity to the Premises until such installations
have been made and Tenant shall be able to obtain electricity directly from the
public utility company.

 

14.04.                  (a)           If
(i) submetering of electricity is prohibited as described in subsection 14.03
above and Tenant does not elect to obtain electricity from the public utility
company, or (ii) if and to the extent that any portion of the Premises or any
portion of Tenant’s electric consumption (KW and KWHR) is measured on a meter
that also measures the electric consumption of another tenant occupying space
in the Building, then, with respect to that portion of the Premises in which
the electrical meter measures electrical usage of

 

64

 

Tenant and another tenant,
or with respect to the entire Premises where submetering is prohibited, as
described above, Landlord shall furnish electricity to Tenant on the basis that
Tenant s consumption (KW and KWHR) of electricity shall be measured by electric
survey made from time to time by Landlord’s consultant.  Pending an initial survey made by Landlord’s
consultant, effective as of the date when Landlord has commenced furnishing
electricity to Tenant pursuant to this subsection 14.04 (with reasonable
proration for any period of less than a full calendar month), the Fixed Rent
specified in Section 1.04 shall be increased by an amount (the “Initial
Charge”) which shall be at the rate of $2.75 per rentable square foot per
annum, or in the event the reason is (i) above, then, if there has been
twelve (12) months charges of submetered electric, an amount equal to the
average of the prior twelve (12) months’ charges for submetered electric.  After completion of the electrical survey
made by Landlord’s consultant of Tenant’s consumption (KW and KWHR) of
electricity, said consultant shall apply Landlord’s Rate as provided in
subsection 14.02 hereof to arrive at an amount (the “Actual Charge”) and the
Fixed Rent shall be appropriately adjusted retroactively to reflect any amount
by which the Actual Charge exceeds or falls below the Initial Charge.  Tenant shall pay that portion of such amount
which would have been paid to the date of the determination of the Actual
Charge within twenty (20) days after being billed therefor.  Thereafter and from time to time during the
term of the lease, Landlord may cause additional surveys of Tenant’s electrical
usage to be made by Landlord’s consultant at Landlord’s expense, subject to
reimbursement subject to Article 3 hereof. 
Tenant from time to time may request Landlord to have a survey made of
Tenant’s electrical usage, and the fees of Landlord’s consultant making such
survey(s) at Tenant’s request shall be paid by Tenant.  In the event any of the foregoing surveys
shall determine that there has been an increase or decrease in Tenant’s usage
of electricity, then effective as of the date of such change in usage the then
current Actual Charge to Tenant by reason of the furnishing of electricity to
Tenant, as same may have been previously increased pursuant to the terms
hereof, shall be increased or decreased (subject to the last sentence of
subsection (b) below) in accordance with such survey determination with
appropriate credit allowed to Tenant in the event of a decrease in usage and in
the event of an increase in such usage Tenant shall pay the increased amount
therefor from the date of such change in usage to the date of such survey
determination within twenty (20) days after being billed 

 

65

 

therefor and thereafter as
part of the increased monthly charge for electricity by reason of such survey
determination.

 

(b)                                 In the event from time to time after
the initial survey or a subsequent survey any additional electrically operated
equipment is installed in the Premises by Tenant and, as a result thereof,
Tenant’s usage of electricity is increased, or if Tenant shall increase its
hours of operation and, as a result thereof, Tenant’s usage of electricity is
increased, or if the charges by the utility company supplying electric current
to Landlord are increased or decreased after the date thereof, then and in any
of such events the monthly charge shall be increased or decreased accordingly
on account of such additional electricity consumed by such newly installed
electrically operated equipment and/or increase in Tenant’s hours of operation
and/or on account of such increased or decreased Landlord’s Rate.  The amount of such increase or decrease in
the monthly charge shall be determined in the first instance by Landlord’s
consultant.  In addition, the monthly
rate will be increased or decreased quarterly in accordance with calculations
by Landlord’s consultant to reflect changes in the fuel adjustment component of
the utility company charge.  Tenant
shall pay the amount of any increase in the monthly charge retroactively
(subject to Tenant’s right to contest in the same manner as in subsection 14.06
hereof provided) from the date of the installation of all newly installed
electrically operated equipment and/or from the date when the increased charges
to Landlord from the utility company become effective and/or from the date of
any increase in Tenant’s hours of operations as the case may be, such amount to
be paid promptly upon billing therefor by Landlord.  Notwithstanding anything to the contrary contained in subsection
14.04, in no event shall the Actual Charge be decreased to an amount which is
less than the Initial Charge per rentable square foot per annum.

 

14.05.                  All survey determinations (including
the first survey made by Landlord’s consultant) shall be subject to contest by
Tenant as provided in subsection 14.06 hereof. 
Surveys made of Tenant’s electrical consumption shall be based upon the
use of electricity between the hours of 8:00 a.m. to 6:00 p.m., Mondays through
Fridays, on Saturdays and such other days and hours when Tenant (or Tenant’s
agents, employees and/or contractors) uses electricity for lighting and for the
operation of the machinery, appliances and equipment used by Tenant in the
Premises; and if cleaning services are provided by Landlord, such survey shall
include 

 

66

 

Landlord’s normal cleaning
hours of five (5) hours per day (which shall not be subject to reduction) for
lighting within the Premises and for electrical equipment normally used for
such cleaning.

 

14.06.                  In the event electricity shall be
furnished to Tenant as contemplated in subsection 14.04 hereof, then Tenant,
within sixty (60) days after notification from Landlord of the determination of
Landlord’s utility consultant (in accordance with the provisions of subsection
14.04 hereof), shall have the right to contest, at Tenant’s cost and expense,
such determination by submitting to Landlord a like survey determination
prepared by a utility consultant of Tenant’s selection, which will highlight
the differences between Landlord’s survey and Tenant’s survey.  If the determination of Tenant’s consultant
does not vary from the determination of Landlord’s consultant by more than five
percent (5%), then Landlord’s determination shall be deemed binding and
conclusive.  If the determination of
Tenant’s consultant varies by more than five percent (5%) and if Landlord’s
consultant and Tenant’s consultant shall be unable to reach agreement within
thirty (30) days, then such two consultants shall designate a third consultant
to make the determination, and the determination of such third consultant shall
be binding and conclusive on both Landlord and Tenant.  If the determination of such third
consultant shall substantially confirm the findings of Landlord’s consultant (i.e.,
within five percent (5%)), then Tenant shall pay the cost of such third
consultant.  If such third consultant
shall substantially confirm the determination of Tenant’s consultant (i.e.,
within five percent (5%)), then Landlord shall pay the cost of such third
consultant.  If such third consultant
shall make a determination substantially different from that of both Landlord’s
and Tenant’s consultants (or is within five percent (5%) of both such
determinations), then the cost of such third consultant shall be borne equally
by Landlord and Tenant.  In the event
that Landlord’s consultant and Tenant’s consultant shall be unable to agree
upon the designation of a third consultant within thirty (30) days after
Tenant’s consultant shall have made its determination (different from that of
Landlord’s consultant), then either party shall have the right to request The
Real Estate Board of New York, Inc. (or, upon their failure or refusal to act,
the American Arbitration Association in the City of New York) to designate a
third consultant whose decision shall be conclusive and binding upon the
parties, and the costs of such third consultant shall be borne as hereinbefore
provided in the case of a third 

 

67

 

consultant designated by
the Landlord’s and Tenant’s consultants. 
Pending the resolution of any contest pursuant to the terms hereof,
Tenant shall pay the Additional Charge on account of electricity determined by
Landlord’s consultant, and upon the resolution of such contest, appropriate
adjustment in accordance with such resolution of such Additional Charge payable
by Tenant on account of electricity shall be made retroactive to the date of
the determination of Landlord’s consultant.

 

14.07.                  If pursuant to any law, ruling, order
or regulation the amount which Landlord is permitted to charge to Tenant for
the purchase of electricity pursuant to this Article shall be reduced below
that which Landlord would otherwise be entitled to charge Tenant hereunder,
then Tenant shall pay the difference between such amounts to Landlord as an
Additional Charge within ten (10) days after being billed therefor by Landlord,
as compensation for the use of the Building’s electric distribution system.

 

14.08.                  Tenant covenants and agrees that at
all times its installations and use of electricity shall never exceed seven (7)
watts connected load per rentable square foot of the Premises.  If (i) Tenant’s installation exceeds seven
(7) watts connected load per rentable square foot of the Premises or (ii)
Tenant requests additional power in addition to that which is being supplied by
Landlord on the date of initial occupancy, then if and to the extent allocated
power is available in the Building for use by Tenant without resulting in
allocation to Tenant of a disproportionate amount of allocated power, Landlord
shall, at Tenant’s cost and expense, provide and install in conformity with law
any additional riser or risers and/or any and all switch or switches and any
submeter to connect additional power to the Premises, and measure the same, and
Tenant agrees to pay Landlord its reasonable, then-established connection
charge for each additional amp of power or portion hereof so supplied to the
Premises, together with the cost of installing such additional risers,
switches, meters and related equipment.

 

14.09.                  Landlord shall not in any way be
liable or responsible to Tenant for any loss, damage or expense which Tenant
may sustain or incur if (i) the supply of electric energy to the Premises is
temporarily interrupted or (ii) the quantity or character of electric service is
changed or is no longer available or suitable for Tenant’s requirements, except

 

68

 

to the extent resulting
from Landlord’s willful misconduct or negligence.

 

14.10.                  At Landlord’s option, Landlord shall
furnish and install all replacement lighting, tubes, lamps, bulbs and ballasts
required in the Premises; and in such event, Tenant shall pay to Landlord or
its designated contractor within twenty (20) days after demand therefor, the
then established reasonable charges therefor of Landlord or its designated
contractor, as the case may be, provided that such charges shall be reasonably
competitive with the charges of other landlords or their designated contractors
for supplying similar services in first class office buildings in downtown
Manhattan.

 

ARTICLE 15

 

Landlord’s Services

 

15.01.                  (a)           Landlord
will provide during the term of this lease in the manner hereinafter more
particularly set forth: (i) heat, ventilation and air conditioning; (ii)
elevator service; (iii) domestic hot and cold water; and (iv) cleaning,
provided, however, that Landlord will have no obligation to furnish cleaning
services to the Premises until such time as Tenant shall have taken occupancy
of the same for the conduct of its business.

 

(b)                                 As used herein, the terms “Business
Hours” shall mean the hours between 8:00 a.m. and 6:00 p.m., and “Business
Days” shall mean all days except Saturdays, Sundays, New Year’s Day,
Washington’s Birthday, Memorial Day, Independence Day, Labor Day, Thanksgiving,
the day following Thanksgiving, and Christmas, and any other days which shall
be either (i) observed by both the federal and the state governments as legal
holidays or (ii) designated as a holiday by the applicable Building
Service Union Employee Service contract or by the applicable Operating
Engineers contract.

 

15.02.                  (a)           Landlord,
during Business Hours on Business Days, shall furnish heat, ventilation and
air-conditioning to the Premises as may be reasonably required (except as
otherwise provided in this lease and except for any special requirements of
Tenant arising from its particular use of the Premises) in accordance with the
specifications set

 

69

 

forth in Exhibit G
attached hereto (subject to the design criteria, including occupancy and
connected electric load design criteria, set forth therein).

 

(b)                                 If Landlord shall make steam available
for Tenant’s use within the Premises for any additional heating or permitted
kitchen use, the cost of such steam as well as the cost of piping and other
equipment or facilities required to supply steam to and distribute steam within
the Premises shall be paid by Tenant. 
Landlord may install and maintain at Tenant’s expense, meters to measure
Tenant’s consumption of steam and Tenant shall reimburse Landlord, within
twenty (20) days after demand, for the quantities of steam shown on such meters
at Landlord’s reasonable charges.

 

(c)                                  (i)            Landlord
shall provide passenger elevator service to each floor of the Premises at all
times during Business Hours of Business Days and at least one of such passenger
elevators shall be subject to call at all other times.  Landlord shall provide freight elevator
service to the Premises on a first come-first served basis (i.e., no
advance scheduling) during Business Hours of Business Days.  Freight elevator service shall also be
provided to the Premises on a reserved basis at all other times, upon the
payment of Landlord’s then established charges therefor which shall be Additional
Charges hereunder.  Tenant’s use of all
elevators shall be on a non-exclusive basis and shall be subject to the Rules
and Regulations and the Alterations Rules and Regulations.

 

(ii)                                  At any time or times all or any of the
elevators in the Building may, at the option of Landlord, be manual and/or
automatic elevators, and Landlord shall be under no obligation to furnish an
elevator operator for any automatic elevator. 
If Landlord shall at any time or times furnish any elevator operator for
any automatic elevator, Landlord may discontinue furnishing such elevator
operator without any diminution, reduction or abatement of rent.

 

(d)                                 Landlord shall furnish reasonable
quantities of hot and cold water to the floor(s) on which the Premises are
located for a drinking fountain, core lavatory facilities and cleaning sink
only.  If Tenant shall require water for
any other installation, Landlord need only furnish cold water at the Building
core riser through a capped outlet located on the floor of the Premises, and the
cost of heating such water as well as piping and supplying such water to the

 

70

 

Premises shall be paid by
Tenant.  Landlord may install and
maintain, at Tenant’s expense, meters to measure Tenant’s consumption of such
cold water and/or hot water for such other installation.  Tenant shall pay to Landlord at Landlord’s
standard charges (which shall be reasonably comparable to the charges of other
landlords of first class office buildings in downtown Manhattan to furnish a
similar service) for the quantities of cold water and hot water shown on such
meters (including Landlord’s charge for the production of such hot water, if
Landlord shall have produced such hot water) within twenty (20) days after
demand.

 

(e)                                  (i)            Except
as otherwise provided below, Landlord shall cause the Premises, including the
exterior and the interior of the windows thereof, to be cleaned in accordance
with the provisions of Exhibit F attached hereto and made a part
hereof.  Tenant shall pay to Landlord
within twenty (20) days after demand the costs incurred by Landlord for (x)
extra cleaning work in the Premises required because of (i) negligence on
the part of Tenant or its subtenants or its or their employees or visitors,
(ii) interior glass partitions or unusual quantity of interior glass surfaces
and (iii) non-building standard materials or finishes installed by Tenant or at
its request, (y) removal from the Premises and the Building of any refuse
and rubbish of Tenant in excess of that ordinarily accumulated in business
office occupancy, including, without limitation, kitchen refuse, or at times
other than Landlord’s standard cleaning times, and (z) the use of the Premises
by Tenant other than during Business Hours on Business Days.  Notwithstanding the foregoing, Landlord
shall not be required to clean any portions of the Premises used for
preparation, serving or consumption of food or beverages, training rooms, data
processing or reproducing operations, private lavatories or toilets or other
special purposes requiring greater or more difficult cleaning work than office
areas and Tenant agrees, at Tenant’s expense, to retain Landlord’s cleaning
contractor to perform such cleaning.  In
addition to the foregoing cleaning of the Premises, Landlord shall provide
cleaning of the common areas of the Building in a manner consistent with a   first-class office building in lower
Manhattan.

 

(ii)           Landlord,
its cleaning contractor and their respective employees shall have access to the
Premises after 6:00 p.m. and before 8:00 a.m. and shall have the right to use,
without charge therefor, all light, power and water in

 

71

 

the Premises reasonably
required to clean the Premises as required under this subsection 15.02(e).

 

(iii)          Tenant
shall not clean, nor require, permit, suffer or allow any windows in the
Premises to be cleaned, from the outside in violation of Section 202 of the
Labor Law, or any other applicable law.

 

15.03.                  If Tenant shall require heat or
air-conditioning services at any time other than on Business Hours of Business
Days (herein called “Overtime HVAC Services”), Landlord shall furnish such
service for such times upon no less than twenty-four (24) hours’ advance notice
from Tenant for periods outside of Business Hours on Business Days and holidays
and by noon of the Friday preceding the weekend on which such overtime service
is desired (which notice may be given by Tenant by hand delivery, and not
otherwise subject to the notice provisions of this lease to a superintendent of
the Building or an authorized representative thereof), and Tenant shall pay to
Landlord as Additional Charges hereunder Landlord’s charges therefor set forth
herein within twenty (20) days after Tenant’s receipt of a bill (itemized in
reasonable detail) for such amount. 
Landlord’s current charges for such overtime services are $165.00 per
hour in the aggregate for the first four (4) floors within the same
air-conditioning/heating zone for which such service is provided (each such
zone is herein called an “HVAC Zone”) and $15.00 per floor per hour for each
additional floor in the same HVAC Zone as such four (4) floors; which charges
for the purposes of this Lease shall be subject to increase or decrease for
each Operating Year commencing with the 2003 Operating Year based upon
Landlord’s good-faith projection (subject to retroactive adjustment, up or
down, upon receipt of actual numbers) of any increases or decreases in its
actual cost of providing such service for such Operating Year (including,
without limitation, any taxes, fees or other charges imposed by any union or
governmental agency in connection with the provision of such Overtime HVAC
Services) over Landlord’s actual cost of providing such service during the 2000
Operating Year.  The cost components of
such Overtime HVAC Services to be taken into account in determining whether
Landlord’s actual cost of providing such service has increased or decreased
are:

 

(i)                                     the actual incremental costs of any
utilities utilized from time to time, including, without limitation, steam,

 

72

 

plant electric, fan/pump electric and make-up
water to provide such services,

 

(ii)                                  the actual incremental cost of any
chemical treatment,

 

(iii)                               any actual incremental costs incurred
to comply with laws (provided that if such costs are required to be capitalized
in accordance with generally accepted accounting principles consistently
applied, such costs, including interest thereon at the Base Rate in effect as
of December 31 of the year in which such alteration or improvements is
made, shall be annuitized (i.e.,
amortized or depreciated, as the case may be, in a manner substantially similar
to a self-liquidating mortgage) over a period commencing upon the completion of
the item in question and extending for the shorter of: (A) the useful life of
the item in question, as reasonably determined by Landlord; or (B) ten (10)
years,

 

(iv)                              any cost component added after the
date hereof for the purpose of reducing Landlord’s actual cost of providing
Overtime HVAC Services (not to exceed the actual savings realized thereby)

 

and shall include any taxes, fees or other
charges imposed by any union or governmental agency in connection with the
provision of such Overtime HVAC Services.

 

If any other tenant or tenants of the
Building request overtime ventilation, air conditioning or heating for any
period for which Tenant has requested such service pursuant to the provisions
of this Section 15.03, in the same Building air conditioning zone, then the
charges for such overtime air conditioning or heating service shall be prorated
among Tenant and such other tenant or tenants, as the case may be, based on the
number of floors to which each tenant is being provided with Overtime HVAC
Services.

 

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15.04.                  Except as otherwise expressly provided
above, Landlord shall not be required to provide any services to the Premises.

 

15.05.                  Landlord reserves the right, without liability
to Tenant and without it being deemed a constructive eviction, to stop or
interrupt any heating, elevator, escalator, lighting, ventilating,
air-conditioning, steam, power, electricity, water, cleaning or other service
and to stop or interrupt the use of any Building facilities and Building
systems at such times as may be necessary and for as long as may reasonably be
required by reason of accidents, strikes, or the making of repairs, alterations
or improvements, or inability to secure a proper supply of fuel, gas, steam,
water, electricity, labor or supplies, or by reason of any other similar or
dissimilar cause beyond the reasonable control of Landlord.  Except as expressly provided herein, no such
stoppage or interruption shall result in any liability from Landlord to Tenant
or entitle Tenant to any diminution or abatement of rent or other compensation
nor shall this lease or any of the obligations of Tenant be affected or reduced
by reason of any such stoppage or interruption.  Notwithstanding any language to the contrary contained in this
Section 15.05, if by reason of the cessation of any services which were
Landlord’s obligation to furnish hereunder, (x) the Premises or any portion
thereof in excess of 2,000 rentable square feet are rendered untenantable for
seven (7) consecutive Business Days or (y) any portion of the Premises which is
2,000 rentable square feet or less are rendered untenantable for ten (10)
consecutive Business Days and Tenant shall actually vacate such portion of the
Premises and notify Landlord that it has so vacated the Premises, then all
Fixed Rent and additional charges reserved herein shall abate after the seventh
(7th) or tenth (10th) Business Day (as the case may be) following the day the
Premises, or the applicable portion thereof, shall be rendered untenantable, in
proportion to the portion of the Premises so effected, until the condition
preventing Tenant from so occupying the Premises, or such portion of the
Premises, as the case may be, shall be remedied.

 

If the applicable cessation of services
rendering the Premises or portions thereof untenantable shall continue for a
period of 270 consecutive Business Days with respect to thirty (30%) percent or
more of the rentable area of the Premises, then provided that (i) not less than
thirty (30) nor more than ninety (90) days before the 270th consecutive

 

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Business Day, Tenant shall
have notified any Superior Lessor or Superior Mortgagee of which Tenant has
been given notice of the existence of such conditions, (ii)  Tenant shall
have actually vacated such portion of the Premises and (iii) such cessation of
services shall not have been the result of Tenant’s acts, omissions or
negligence, Tenant shall have the right to terminate this lease in whole or as
to the portions thereof affected by such condition (at the option of Tenant),
by giving no less than thirty (30) days prior notice to Landlord, and if the
Premises (or such portion thereof) shall not have been rendered tenantable on
or before the expiration of such thirty (30) day period, then this lease shall
be automatically terminated in whole or as to the portion thereof affected by
such condition, as applicable, on the date immediately succeeding the
expiration of the thirty (30) day period as if such day were the day set forth
above for the expiration for the term of this lease.

 

15.06.                  Only Landlord or persons approved by
Landlord shall be permitted to furnish or sell laundry, linen, towels, drinking
water, ice, food, beverages, bootblacking, barbering and other similar supplies
and services to tenants which approval shall not be unreasonably withheld or
delayed.  Landlord may fix the
circumstances under which such supplies and services are to be furnished or
sold, provided that the cost of such supplies and services shall be reasonably
competitive.  However, Tenant, its
regular office employees or invitees may personally bring, or have delivered,
food or beverages into the Building for consumption within the Premises solely
by Tenant, its regular office employees or invitees.

 

15.07.                  In addition to any remedies which
Landlord may have under this lease, and without reducing or adversely affecting
any of Landlord’s rights and remedies contained elsewhere in this lease, if there
shall be a monetary default hereunder by Tenant which shall not have been
remedied within the applicable grace period, Landlord shall not be obligated to
furnish to Tenant or the Premises any services outside of Business Hours on
Business Days; and the discontinuance of any one or more such services shall be
without liability by Landlord to Tenant and shall not reduce, diminish or
otherwise affect any of Tenant’s covenants and obligations under this lease.

 

15.08.                  Landlord, at Tenant’s request, shall maintain
an amount up to Tenant’s Share of the listings on the

 

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Building directory of the
names of Tenant, and the names of Tenant’s officers and employees, provided
that Landlord shall have the right to substitute a computerized Building
directory provided that the number of listings thereon is not reduced.  The initial programming of such computerized
directory shall be without charge to Tenant. 
From time to time, but not more frequently than once every three (3)
months, Landlord shall reprogram the computerized directory to reflect such
changes in the listings therein as Tenant shall request, and Tenant shall pay
to Landlord a reasonable reprogramming charge for each reprogramming Tenant
requests, as additional rent, promptly after request therefor.  Landlord shall also maintain a listing of
Tenant’s name on the plaques of the elevators serving the Premises for so long
as Landlord provides tenant names on elevator plaques.  The reasonable charge of Landlord for any
changes in such listings requested by Tenant shall be paid by Tenant to
Landlord on demand.

 

15.09.                  Upon written request of Tenant,
Landlord shall make available to the Premises, for the operation of Tenants’
Supplemental air conditioning system in Tenant’s
telephone/communications/equipment room, up to three (3) tons of chilled water
without additional charge to Tenant, and up to an additional seventeen and
one-half (17-1/2) tons of chilled water to be provided at Landlord’s standard
charges (which, as of the date of this lease, are $.38 per ton hour, subject to
adjustment from time to time).  Tenant
shall not be required to pay to Landlord any hook-up or tap-in fees in
connection with its consumption of chilled water in the Premises; provided,
however, that Tenant’s connection to the Building’s chilled water supply and
return system shall constitute an Alteration which shall be subject to all of
the terms and conditions of this lease, including Article 11 hereof, and any
such Alterations shall be performed by Tenant, at Tenant’s cost and expense, by
a contractor designated or approved by Landlord.

 

ARTICLE 16

 

Access and Name of Building

 

16.01.                  Except for the space within the inside
surfaces of all walls, hung ceilings, floors, windows and doors bounding the
Premises, all of the Building, including, without limitation, exterior and
atrium Building walls, core corridor walls and doors and any core corridor
entrance, any terraces or roofs adjacent to the Premises, and any space in or
adjacent to the Premises used for shafts, stacks, pipes,

 

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conduits, fan rooms,
ducts, electric or other utilities, sinks or other Building facilities, and the
use thereof, as well as access thereto through the Premises for the purposes of
operation, maintenance, decoration and repair, are reserved to Landlord and
persons authorized by Landlord.  Tenant
acknowledges that Landlord may install in the Building on the inside of the windows
thereof a film to reduce the usage of energy in the Building.  Tenant agrees that the foregoing provisions
of this Section 16.01 shall apply to the installation, maintenance or
replacement of such film.

 

16.02.                  Landlord reserves the right, and
Tenant shall permit Landlord and persons authorized by Landlord, to install,
erect, use and maintain pipes, ducts and conduits in and through the Premises
provided same shall be concealed behind, beneath or within partitioning,
columns, ceilings or floors located or to be located in the Premises.  Notwithstanding the foregoing, any such
pipes, ducts, or conduits may be furred at points immediately adjacent to
partitioning columns or ceilings located or to be located in the Premises,
provided that the same are completely furred and that the installation of such
pipes, ducts, or conduits, when completed, shall not reduce the usable area of
the Premises beyond a de minimis amount and further provided that such
installation is performed in a manner calculated to minimize interference with
Tenant’s conduct of business in the Premises.

 

16.03.                  Landlord and persons authorized by
Landlord shall have the right to enter and/or pass through the Premises at any
reasonable time or times upon reasonable prior notice (except in the case of an
emergency), which notice may be oral, (a) to examine the Premises and to show
them to actual and prospective Superior Lessors, Superior Mortgagees, or
prospective purchasers, mortgagees or lessees of the Building, (b) to make such
repairs, alterations, additions and improvements in or to the Premises and/or
in or to the Building or its facilities and equipment as Landlord or persons
authorized by Landlord is or are required or desires to make, (and Landlord
shall endeavor to give Tenant prior written notice of any such alterations,
additions and improvements to the extent that Landlord has prior knowledge
thereof) and (c) to read any utility meters located therein.  Landlord and such authorized persons shall
be allowed to take all materials into and upon the Premises that may be required
in connection therewith, without any liability to Tenant and without any
reduction of Tenant’s covenants and obligations

 

77

 

hereunder except as set
forth in Section 13.03 hereof.  In
making any such entry into the Premises, pursuant to this Section 16.03,
Landlord shall exercise reasonable diligence so as to minimize interference
with Tenant’s business operations in the Premises, but nothing contained in
this sentence shall be deemed to require Landlord to make any such entry on an
overtime basis.

 

16.04.                  If at any time any windows of the
Premises are either temporarily darkened or obstructed by reason of any
repairs, improvements, maintenance and/or cleaning in or about the Building (or
permanently darkened or obstructed if required by law) or covered by any
translucent material for the purpose of energy conservation, or if any part of
the Building, other than the Premises, is temporarily or permanently closed or
inoperable, the same shall be without liability to Landlord and without any
reduction or diminution of Tenant’s obligations under this lease.  Landlord agrees that it will not permanently
obstruct any windows of the Premises unless same shall in Landlord’s reasonable
judgment be required by law or for safety or security reasons.

 

16.05.                  During the time period referred to in
subsection 7.07(a) hereof and during the period of eighteen (18) months prior
to the expiration date of this lease, Landlord and persons authorized by
Landlord may exhibit the Premises to prospective tenants.

 

16.06.                  If, during the last month of the term
of this lease, Tenant has removed all or substantially all of Tenant’s property
from the Premises, Landlord or persons authorized by Landlord may, without
notice to Tenant, immediately enter the Premises and alter, renovate and
decorate the same, without liability to Tenant and without reducing or
otherwise affecting Tenant’s covenants and obligations hereunder.

 

16.07.                  Except as specifically provided
herein, Landlord reserves the right, at any time, without it being deemed a
constructive eviction and without incurring any liability to Tenant therefor,
or affecting or reducing any of Tenant’s covenants and obligations hereunder,
except as set forth in Section 13.03 hereof, to make or permit to be made such
changes, alterations, additions and improvements in or to the Building and the
fixtures and equipment thereof, as well as in or to the street entrances,
atrium, doors, halls, passages, elevators, escalators and stairways thereof,
and

 

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other public parts of the
Building, as Landlord shall, in its reasonable judgment, deem necessary or
desirable provided any such changes, additions, alterations or improvements do
(a) unreasonably reduce, interfere with or deprive Tenant of access to the
Building or the Premises or (b) reduce the usable area (except by a de
rninimis amount) of the Premises.

 

16.08.                  Landlord reserves the right to name
the Building and to change the name or address of the Building at any time and
from time to time, provided however that Landlord shall give Tenant reasonable
advance notice of any such change. 
Neither this lease nor any use by Tenant shall give Tenant any easement
or other right in or to the use of any door or any passage or any concourse or
any plaza connecting the Building with any subway or any other building or to
any public conveniences, and the use of such doors, passages, concourses,
plazas and conveniences may without notice to Tenant, be regulated or
discontinued at any time by Landlord.

 

16.09.                  If Tenant shall not be personally
present to open and permit an entry into the Premises at any time when for any
reason an entry therein shall be urgently necessary by reason of fire or other
emergency, Landlord or Landlord’s agents may forcibly enter the same without
rendering Landlord or such agents liable therefor (if during such entry
Landlord or Landlord’s agents shall accord reasonable care to Tenant’s
property) and without in any manner affecting the obligations and covenants of
this lease.

 

16.10.                  Notwithstanding any language to the
contrary contained herein, Tenant may designate portions of the Premises as
special security areas, as to which, except in case of emergency where there is
reasonably perceived to be imminent danger to person or property, Landlord may
enter and/or pass through only when accompanied by a representative of Tenant,
provided that Tenant agrees to make such representative available upon one (1)
Business Day’s request by Landlord (which request need not be in writing).  Landlord shall not be obligated to clean any
area that is designated by Tenant as a special security area, unless Tenant
requests that Landlord clean such areas and makes access thereto available to
Landlord for that purpose at such times as the building cleaners would in the
normal course clean such areas.

 

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ARTICLE 17

 

Notice of Occurrences

 

17.01.                  Upon becoming aware of the same,
Tenant shall give prompt notice to Landlord after Tenant becomes aware thereof,
of (a) any occurrence in or about the Premises for which Landlord might be
liable, (b) any fire or other casualty in the Premises, (c) any damage to or
defect in the Premises, including the fixtures, equipment and appurtenances
thereof, for the repair of which Landlord might be responsible, and
(d) any damage to or defect in any part or appurtenance of the Building’s
sanitary, electrical, heating, ventilating, air-conditioning, elevator or other
systems located in or passing through the Premises or any part thereof.

 

ARTICLE 18

 

Non-Liability and
Indemnification

 

18.01.                  Neither Landlord, any Superior Lessor
or any Superior Mortgagee, nor any partner, director, officer, shareholder,
principal, agent, servant or employee of Landlord, any Superior Lessor or any
Superior Mortgagee (in any case whether disclosed or undisclosed), shall be
liable to Tenant for any loss, injury or damage to Tenant or its employees,
agents, contractors, subtenants and licensees, or to its or their property,
irrespective of the cause of such injury, damage or loss, nor shall the
aforesaid parties be liable for any damage to property of Tenant or its
employees, agents, contractors, subtenants and licensees entrusted to employees
of Landlord nor for loss of or damage to any such property by theft or
otherwise and in either case unless and to the extent caused by or resulting
from the negligence or willful misconduct of Landlord, its agents, contractors,
servants or employees in the operation or maintenance of the Premises or the
Real Property.  Further, neither
Landlord, any Superior Lessor or any Superior Mortgagee, nor any partner,
director, officer, principal, shareholder, agent, servant or employee of
Landlord, any Superior Lessor or any Superior Mortgagee, shall be liable
(a) for any such damage caused by other tenants or persons in, upon or
about the Building or the Real Property, or caused by operations in
construction of any private, public or quasi-public work unless caused by or resulting
from the negligence or willful misconduct of Landlord, its agents, contractors,
servants or employees in the operation or maintenance of the Premises or the
Real 

 

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Property; or (b) even if
negligent, for consequential damages arising out of any loss of use of the
Premises or any equipment, facilities or other Tenant’s Property therein by
Tenant or any person claiming through or under Tenant.

 

18.02.                  Subject to the provisions of Section
9.04 hereof, Tenant shall indemnify and hold harmless Landlord and all Superior
Lessors and Superior Mortgagees and its and their respective partners,
directors, officers, principals, shareholders, agents and employees from and
against any and all claims arising from or in connection with (a) the
conduct or management of the Premises or of any business therein, or any work
or thing whatsoever done, or any Alteration performed by or on behalf of Tenant
in or about the Premises during the term of this lease or during the period of
time, if any, prior to the Commencement Date that Tenant may have been given
access to the Premises excluding, however, any claim, demand, loss, damage,
cause of action or liability which is due to the negligence or willful
misconduct of Landlord, its predecessors in interest or its employees,
contractors, invitees (which are not Tenant’s invitees) or licensees, or
agents; (b) any act, omission or negligence of Tenant or any of its subtenants
or licensees or its or their partners, directors, principals, shareholders,
officers, agents, employees or contractors; (c) any accident, injury or damage
whatever occurring in, at or upon the Premises excluding, however, any claim,
demand, loss, damage, cause of action or liability which is due to the negligence
or willful misconduct of Landlord, its predecessors in interest or its
employees, contractors or agents; and (d) any breach or default by Tenant
in the full and prompt payment and performance of Tenant’s obligations under
this lease; together with all costs, expenses and liabilities incurred in or in
connection with each such claim or action or proceeding brought thereon,
including, without limitation, all attorneys’ fees and expenses.  In case any action or proceeding be brought
against Landlord and/or any Superior Lessor or Superior Mortgagee and/or its or
their partners, directors, officers, principals, shareholders, agents and/or
employees by reason of any such claim, Tenant, upon notice from Landlord or
such Superior Lessor or Superior Mortgagee, shall resist and defend such action
or proceeding (by counsel reasonably satisfactory to Landlord or such Superior
Lessor or Superior Mortgagee and counsel of Tenant’s insurer shall be deemed
satisfactory thereto).  Landlord agrees
that Tenant’s hold harmless and indemnification obligations pursuant to this
Section 18.02 shall be subject to Section 9.04 hereof and shall in no event
extend to (x) consequential damages or (y)

 

81

 

any claims, demands, loss,
damage, cause of action or liability due to the presence of Hazardous Materials
(as hereinafter defined) in the Premises unless such Hazardous Materials were
installed by Tenant, its agents, contractors, employees or Tenant’s subtenants
(other than Landlord or its designee), licensees or their respective agents,
employees or contractors.

 

ARTICLE 19

 

Damage or Destruction

 

19.01.                  If the Building or the Premises shall
be partially or totally damaged or destroyed by fire or other casualty (and if
this lease shall not be terminated as in this Article 19 hereinafter provided),
(a) Landlord shall repair the damage to and restore and rebuild the Building
and the Premises (including Tenant’s improvements and betterments but excluding
the property which is deemed Tenant’s Property pursuant to Section 12.01
hereof) with reasonable dispatch after notice to it of the damage or
destruction and the collection of the insurance proceeds attributable to such
damage, and (b) Tenant shall repair the damage to and restore and repair the
property which is deemed Tenant’s Property pursuant to Section 12.01 hereof
with reasonable dispatch after such damage or destruction.  Such work by Tenant shall be deemed
Alterations for the purposes of Article 11 hereof.  The proceeds of policies providing coverage
for Tenant’s improvements and betterments shall be paid to Landlord.  Concurrently with the collection of any
insurance proceeds attributable to the damage of Tenant’s improvements and
betterments, Tenant shall pay to Landlord (i) the amount of any deductible
under the policy insuring Tenant’s improvements and betterments and (ii) the
amount, if any, by which the cost of repairing and restoring Tenant’s
improvements and betterments as estimated by a reputable contractor designated
by Landlord exceeds the available insurance proceeds therefor.  The amounts due in accordance with
subparagraphs (i) and (ii) above shall be Additional Charges under this lease
and payable by Tenant to Landlord upon demand, subject, however, to the
provisions of Section 19.07 hereof.

 

19.02.                  Subject to the provisions of Section
19.05 hereof, if all or part of the Premises shall be damaged or destroyed or
rendered completely or partially untenantable on account of fire or other
casualty, the Fixed Rent and the

 

82

 

Additional Charges under
Article 3 hereof shall be abated in the proportion that the untenantable area
of the Premises bears to the total area of the Premises, for the period from
the date of the damage or destruction to (i) the date the damage to the
Premises (exclusive of Tenant’s Property) shall be substantially repaired
(provided, however, that if in Landlord’s reasonable judgment such repairs
would have been substantially completed at an earlier date but for Tenant’s
having failed to reasonably cooperate with Landlord in effecting such repair,
then the Premises shall be deemed to have been repaired substantially on such
earlier date and any reduction or abatement shall cease) or (ii) if the
Building and not the Premises is so damaged or destroyed, the date on which the
Premises shall be made tenantable; provided, however, should Tenant or any of
its subtenants reoccupy a portion of the Premises during the period the repair
work is taking place and prior to the date that the Premises are substantially
repaired or made tenantable, the Fixed Rent and the Additional Charges
allocable to such reoccupied portion, based upon the proportion which the area
of the reoccupied portion of the Premises bears to the total area of the
Premises, shall be payable by Tenant from the date of such occupancy.  Landlord agrees that for the purposes of
this Section 19.02 only, if seventy (70%) percent or more of the Premises shall
be damaged or destroyed and Tenant elects to vacate the entire Premises, then
for the purposes of determining the abatement of Fixed Rent and Additional
Charges under Article 3 hereof, the entire Premises shall be deemed to be
untenantable.

 

19.03.                  If (i) the Building shall be totally
damaged or destroyed by fire or other casualty, or if the Building shall be so
damaged or destroyed by fire or other casualty (whether or not the Premises are
damaged or destroyed) that its repair or restoration requires more than two
hundred seventy (270) days or the expenditure of more than twenty (20%) percent
of the full insurable value of the Building immediately prior to the casualty
or (ii) if the Premises shall be totally or substantially (i.e., for
this purpose, more than thirty (30%) percent) damaged or destroyed (as
estimated in any such case by an independent, reputable contractor, registered
architect or licensed professional engineer reasonably designated by Landlord),
or (iii) if more than twenty (20%) percent of the premises shall be damaged
during the last two (2) years of the term of this lease (as the same may be
extended) and such damage cannot be repaired in ninety (90) days, then in any
such case Landlord may

 

83

 

terminate this lease by
giving Tenant notice to such effect within one hundred eighty (180) days after
the date of the casualty.  For the
purpose of this Section only, “full insurable value” shall mean replacement
cost less the cost of footings, foundations and other structures below the
street and first floors of the Building.

 

19.04.                  In the case of any damage or
destruction mentioned in this Article 19, Tenant may terminate this lease by
notice to Landlord if:  (i) within
ninety (90) days after the date of such damage or destruction (x) Landlord shall
not have let a contract or contracts which shall provide for the restoration of
the Building within a period of fifteen (15) months from the date of the damage
or destruction; and (y) subject to delays due to adjustment of insurance, labor
trouble, governmental contracts, act of God or any other cause beyond
Landlord’s reasonable control, work under such contract or contracts shall not
have commenced; or (ii) if there has been substantial damage or destruction to
any portion or portions of the Building other than the Premises and Landlord
shall not have completed the making of the required repairs and restored and
rebuilt the Building and the Premises within fifteen (15) months from the date
of such damage or destruction, or within such period after such date (not
exceeding three (3) months) as shall equal the aggregate period Landlord may
have been delayed in doing so by adjustment of insurance, labor trouble,
governmental controls, act of God, or any other cause beyond Landlord’s
reasonable control; or (iii) if more than twenty (20%) percent of the Premises
shall be damaged during the last two (2) years of the term of this lease (as
the same may be extended) and such damage cannot be repaired in ninety (90)
days.  Except as expressly provided in
this Section 19.04, Tenant shall not be entitled to terminate this lease and no
damages, compensation or claim shall be payable by Landlord for inconvenience,
loss of business or annoyance arising from any repair or restoration of any
portion of the Premises or of the Building pursuant to this Article.  Landlord shall use reasonable efforts to
make such repair or restoration promptly and in such manner as to not, to the
extent practicable, unreasonably interfere with Tenants use and occupancy of
the Premises, but Landlord shall not be required to do such repair or
restoration work except during Business Hours, except that Landlord agrees that
it shall perform such repairs or restorations on an overtime basis if, in
Landlords reasonable judgment, it is customary in  accordance with then generally

 

84

 

accepted practices in the
construction industry to perform such work on an overtime basis.

 

19.05.                  Landlord and Tenant each agree to use
diligent efforts to cooperate with each other and with their respective
insurers in order to facilitate the collection of all insurance proceeds
(including without limitation rent insurance proceeds) applicable to damage and
destruction of the Building or the Premises by fire or other casualty.

 

19.06.                  Landlord will not carry insurance of
any kind on Tenant’s Property or on Tenant’s improvements and betterments and
shall not be obligated to repair any damage to or replace Tenant’s Property and
Tenant agrees to look solely to its insurance for recovery of any damage to or
loss of Tenant’s Property.  If Tenant
shall fail to maintain such insurance, Landlord shall have the right to obtain
insurance on Tenant’s Property and the cost thereof shall be Additional Charges
under this lease and payable by Tenant to Landlord on demand.

 

19.07.                  If this lease shall be terminated by
either Landlord or Tenant pursuant to the provisions of this Article 19, the
proceeds of the insurance maintained by Tenant on Tenants improvements and
betterments shall be divided between Landlord and Tenant to reflect the portion
of the original cost of such improvements and betterments paid for by each
party, provided, however, in the event that such casualty shall occur after the
date which is eighteen (18) months prior to the expiration of the initial term
of this lease and Tenant shall not have exercised its right to extend the term
of this lease prior to such date, Landlord shall receive all the proceeds from
the insurance maintained by Tenant on Tenant’s improvements and betterments.

 

19.08.                  The provisions of this Article 19
shall be deemed an express agreement governing any case of damage or
destruction of the Premises by fire or other casualty, and Section 227 of the
Real Property Law of the State of New York, providing for such a contingency in
the absence of an express agreement, and any other law of like import, now or
hereafter in force, shall have no application in such case.

 

85

 

ARTICLE 20

 

Eminent Domain

 

20.01.                  If the whole of the Building or the
Premises shall be taken by condemnation or in any other manner for any public
or quasi-public use or purpose, this lease and the term and estate hereby
granted shall terminate as of the date of vesting of title on such taking
(herein called “Date of the Taking”), and the Fixed Rent and Additional Charges
shall be prorated and adjusted as of such date.

 

20.02.                  If any part of the Building or the
Land shall be so taken, this lease shall be unaffected by such taking, except
that (a) Landlord may, at its option, terminate this lease by giving Tenant
notice to that effect within ninety (90) days after the Date of the Taking, and
(b) if ten (10%) percent or more of the rentable area of the Premises shall be
so taken and, if as a result of any such partial taking, the entire Premises
become untenantable, or there shall be no access to the Premises, Tenant may
terminate this lease by giving Landlord notice to that effect within
90 days after the Date of the Taking. 
This lease shall terminate on the date that such notice from Landlord or
Tenant to the other shall be given, and the Fixed Rent and Additional Charges
shall be prorated and adjusted as of such termination date.  Upon such partial taking and this lease
continuing in force as to any part of the Premises, the Fixed Rent and Tenant’s
Share shall be reduced and the Base Tax Amount and Base Operating Amount shall
be adjusted in the proportion that the area of the Premises taken bears to the
total area of the Premises.

 

20.03.                  Landlord shall be entitled to receive
the entire award or payment in connection with any taking without reduction
therefrom for any estate vested in Tenant by this lease or any value
attributable to the unexpired portion of the term of this lease and Tenant shall
receive no part of such award except as hereinafter expressly provided in this
article.  Tenant hereby expressly
assigns to Landlord all of its right, title and interest in and to every such
award or payment and waives any right to the value of the unexpired portion of
the term of this lease.  Nothing
contained in this Section 20.03 shall be deemed to prevent Tenant from making a
separate claim in any condemnation proceedings for the then value of any
Tenant’s Property included in such taking, and the then unamortized value, as
of the date of taking, calculated on a straight line basis over the term of
this lease, of any amount paid by Tenant on account of any leasehold
improvements installed by Tenant or at Tenant’s

 

86

 

expense and for any moving
expenses, but only if such claim shall be awarded by the condemnation court in
addition to, and shall not result in the reduction of, the award made by it for
the Building or the Land so taken.

 

20.04.                  If the temporary use or occupancy of
all or any part of the Premises shall be taken by condemnation or in any other
manner for any public or quasi-public use or purpose during the term of this
lease, Tenant shall be entitled, except as hereinafter set forth, to receive
that portion of the award or payment for such taking which represents
compensation for the use and occupancy of the Premises, for the taking of
Tenant’s Property and for moving expenses, and Landlord shall be entitled to
receive that portion which represents reimbursement for the cost of restoration
of the Premises.  This lease shall be
and remain unaffected by such taking. 
If the period of temporary use or occupancy shall extend beyond the
Expiration Date of this lease, that part of the award which represents
compensation for the use and occupancy of the Premises (or a part thereof)
shall be divided between Landlord and Tenant so that Tenant shall receive so
much thereof as represents the period up to and including such Expiration Date
and Landlord shall receive so much thereof as represents the period after such
Expiration Date.  All monies paid as, or
as part of, an award for temporary use and occupancy for a period beyond the
date to which the Fixed Rent and Additional Charges have been paid shall be received,
held and applied by Landlord as a trust fund for payment of the Fixed Rent and
Additional Charges becoming due hereunder and Tenant shall have no obligation
to pay any excess monies to Landlord or to otherwise comply with the provisions
of this lease during such period that Tenant shall not have the right to occupy
the Premises by reason of such temporary taking.

 

20.05.                  In the event of a taking of less than
the whole of the Building and/or the Land which does not result in termination
of this lease, or in the event of a taking for a temporary use or occupancy of
all or any part of the Premises which does not result in a termination of this
lease, (a) Landlord, at its expense, and whether or not any award or awards
shall be sufficient for the purpose, shall proceed with reasonable diligence to
repair the remaining parts of the Building and the Premises (other than any
leasehold improvements) to substantially their former condition to the extent
that the same may be feasible (subject to reasonable changes which Landlord
shall deem desirable) and so as to constitute a complete and rentable Building
and Premises and

 

87

 

(b) Tenant, at its
expense, and whether or not any award or awards shall be sufficient for the
purpose, shall proceed with reasonable diligence to repair the remaining parts
of the Premises to substantially their former condition to the extent that the
same may be feasible, subject to reasonable changes which shall be deemed
Alterations.

 

ARTICLE 21

 

Surrender

 

21.01.                  On the Expiration Date or upon any
earlier termination of this lease, or upon any reentry by Landlord upon the
Premises, Tenant shall quit and surrender the Premises to Landlord
“broom-clean” and in good order, condition and repair, except for (i) ordinary
wear and tear and (ii) such damage or destruction as Landlord (and not Tenant)
is required to repair or restore under this lease, including, without
limitation, damage caused by Landlord, its agents or its employees or contractors,
and repair of damage caused by fire or other casualty, and (iii) latent defects
in the Building systems or structure, and Tenant shall remove all of the
Tenant’s Property therefrom except as otherwise expressly provided in this
lease.

 

21.02.                  No act or thing done by Landlord or
its agents shall be deemed an acceptance of a surrender of the Premises prior
to the Expiration Date, and no agreement to accept such surrender prior to the
Expiration Date shall be valid unless in writing and signed by Landlord and
each Superior Lessor and Superior Mortgagee whose lease or mortgage, as the
case may be, provides that no such surrender may be accepted without its
consent.

 

ARTICLE 22

 

Conditions of Limitation

 

22.01.                  This lease and the term and estate
hereby granted are subject to the limitation that whenever Tenant, or any
guarantor of Tenant’s obligations under this lease, shall make an assignment
for the benefit of creditors, or shall file a voluntary petition under any
bankruptcy or insolvency law, or an involuntary petition alleging an act of
bankruptcy or insolvency shall be filed against Tenant or such guarantor

 

88

 

under any bankruptcy or
insolvency law, or whenever a petition shall be filed by or against Tenant or
such guarantor under the reorganization provisions of the United States
Bankruptcy Code or under the provisions of any law of like import, or whenever
a petition shall be filed by Tenant, or such guarantor, under the arrangement
provisions of the United States Bankruptcy Code or under the provisions of any
law of like import, or whenever a permanent receiver of Tenant, or such
guarantor, or of or for the property of Tenant, or such guarantor, shall be
appointed, then Landlord (a) if such event occurs without the acquiescence of
Tenant, or such guarantor, as the case may be, at any time after the event
continues for sixty (60) days, or (b) in any other case at any time after the
occurrence of any such event, may give Tenant a notice of intention to end the
term of this lease at the expiration of five days from the date of service of
such notice of intention, and upon the expiration of said five-day period this
lease and the term and estate hereby granted, whether or not the term shall
theretofore have commenced, shall terminate with the same effect as if that day
were the expiration date of this lease, but Tenant shall remain liable for
damages as provided in Article 24 hereof.

 

22.02.                  This lease and the term and estate
hereby granted are subject to the further limitations that:

 

(a)                                  if Tenant shall default in the payment
of any Fixed Rent or Additional Charges, and such default shall continue for
ten (10) Business Days after Landlord shall have given to Tenant a notice
thereof, or

 

(b)                                 if Tenant shall, whether by action or
inaction, be in default of any of its obligations under this lease (other than
a default in the payment of Fixed Rent or Additional Charges) and such default
shall continue and not be remedied as soon as practicable and in any event within
thirty (30) days after Landlord shall have given to Tenant a notice specifying
the same, or, in the case of a default which cannot with due diligence be cured
within a period of thirty (30) days and the continuance of which for the period
required for cure will not (i) subject Landlord or any Superior Lessor or any
Superior Mortgagee to prosecution for a crime or any other fine or charge, (ii)
subject the Premises or any part thereof or the Building or

 

89

 

Land, or any part thereof, to being condemned
or vacated, (iii) subject the Building or Land, or any part thereof, to any
lien or encumbrance, or (iv) result in the termination of any Superior Lease or
foreclosure of any Superior Mortgage, if Tenant shall not (x) within said
thirty (30) day period advise Landlord of Tenant’s intention to take all steps
necessary to remedy such default, (y) duly commence within said 30-day period,
and thereafter diligently prosecute to completion all steps necessary to remedy
the default and (z) complete such remedy within a reasonable time after the
date of said notice of Landlord, or

 

(c)                                  if any event shall occur or any
contingency shall arise whereby this lease or the estate hereby granted or the
unexpired balance of the term hereof would, by operation of law or otherwise,
devolve upon or pass to any person, firm or corporation other than Tenant,
except as expressly permitted by Article 7 hereof, or

 

(d)                                 if Tenant shall abandon the Premises
(and the fact that any of Tenant’s Property remains in the Premises shall not
be evidence that Tenant has not vacated or abandoned the Premises), or

 

(e)                                  if there shall be any default by
Tenant under any other lease in the Building with Landlord (or any person
which, directly or indirectly, controls, is controlled by, or is under common
control with, Landlord), which shall not be remedied within the applicable
grace period, if any, provided therefor under such other lease,

 

then in any of said cases Landlord may give
to Tenant a notice of intention to end the term of this lease at the expiration
of five (5) days from the date of the service of such notice of intention, and
upon the expiration of said five (5) days this lease and the term and estate
hereby granted, whether or not the term shall theretofore have commenced, shall
terminate with the same effect as if that day was the day herein definitely
fixed for the end and expiration of this lease, but Tenant shall remain liable
for damages as provided in Article 24 hereof.

 

90

 

22.03.                  (a)                                  If Tenant shall have assigned its
interest in this lease, and this lease shall thereafter be disaffirmed or
rejected in any proceeding under the United States Bankruptcy Code or under the
provisions of any Federal, state or foreign law of like import, or in the event
of termination of this lease by reason of any such proceeding, the assignor or
any of its predecessors in interest under this lease, upon request of Landlord
given within ninety (90) days after such disaffirmance or rejection shall (a)
pay to Landlord all Fixed Rent and Additional Charges then due and payable to
Landlord under this lease to and including the date of such disaffirmance or
rejection and (b) enter into a new lease as lessee with Landlord of the
Premises for a term commencing on the effective date of such disaffirmance or
rejection and ending on the Expiration Date, unless sooner terminated as in
such lease provided, at the same Fixed Rent and Additional Charges and upon the
then executory terms, covenants and conditions as are contained in this lease,
except that (i) the rights of the lessee under the new lease, shall be subject
to any possessory rights of the assignee in question under this lease and any
rights of persons claiming through or under such assignee, (ii) such new lease
shall require all defaults existing under this lease to be cured by the lessee
with reasonable diligence, and (iii) such new lease shall require the lessee to
pay all Additional Charges which, had this lease not been disaffirmed or
rejected, would have become due after the effective date of such disaffirmance
or rejection with respect to any prior period. 
If the lessee shall fail or refuse to enter into the new lease within
ten (10) days after Landlord’s request to do so, then in addition to all other
rights and remedies by reason of such default, under this lease, at law or in
equity, Landlord shall have the same rights and remedies against the lessee as
if the lessee had entered into such new lease and such new lease had thereafter
been terminated at the beginning of its term by reason of the default of the
lessee thereunder.

 

(b)                                 If pursuant to the Bankruptcy Code
Tenant is permitted to assign this lease in disregard of the restrictions
contained in Article 7 hereof (or if this lease shall be assumed by a trustee),
the trustee or assignee shall cure any default under this lease and shall
provide adequate assurance of future performance by the trustee or assignee
including (a) of the source of payment of rent and performance of other
obligations under this lease (for which adequate assurance shall mean the
deposit of cash security with Landlord in an amount equal to the sum of one
year’s Fixed

 

91

 

Rent then reserved
hereunder plus an amount equal to all Additional Charges payable under Article
3 for the calendar year preceding the year in which such assignment is intended
to become effective, which deposit shall be held by Landlord, without interest,
for the balance of the term as security for the full and faithful performance
of all of the obligations under this lease on the part of Tenant yet to be
performed) and that any such assignee of this lease shall have a net worth
exclusive of good will, computed in accordance with generally accepted
accounting principles, equal to at least ten (10) times the aggregate of the
annual Fixed Rent reserved hereunder plus all Additional Charges for the
preceding calendar year as aforesaid and (b) that the use of the Premises shall
in no way diminish the reputation of the Building as a first-class office
building or impose any additional burden upon the Building or increase the
services to be provided by Landlord.  If
all defaults are not cured and such adequate assurance is not provided within
60 days after there has been an order for relief under the Bankruptcy Code,
then this lease shall be deemed rejected, Tenant or any other person in
possession shall vacate the Premises, and Landlord shall be entitled to retain
any rent or security deposit previously received from Tenant and shall have no
further liability to Tenant or any person claiming through Tenant or any
trustee.  If Tenant receives or is to
receive any valuable consideration for such an assignment of this lease, such
consideration, after deducting therefrom (a) the brokerage commissions, if any,
and other expenses reasonably incurred by Tenant for such assignment and (b)
any portion of such consideration reasonably designed by the assignee as paid
for the purchase of Tenant’s Property in the Premises, shall be and become the
sole exclusive property of Landlord and shall be paid over to Landlord directly
by such assignee.  If Tenant’s trustee,
Tenant or Tenant as debtor-in-possession assumes this lease and proposes to
assign the same (pursuant to Title 11 U.S.C. Section 365, as the same may be
amended) to any person, including, without limitation, any individual,
partnership or corporate entity, who shall have made a bona fide offer to
accept an assignment of this lease on terms acceptable to the trustee, Tenant
or Tenant as debtor-in-possession, then notice of such proposed assignment,
setting forth (x) the name and address of such person, (y) all of the terms and
conditions of such offer, and (z) the adequate assurance to be provided
Landlord to assure such person’s future performance under this lease,
including, without limitation, the assurances referred to in Title 11 U.S.C.
Section 365(b)(3) (as the same may be amended), shall be given

 

92

 

to Landlord by the
trustee, Tenant or Tenant as debtor-in-possession no later than twenty (20)
days after receipt by the trustee, Tenant or Tenant as debtor-in-possession of
such offer, but in any event no later than ten (10) days prior to the date that
the trustee, Tenant or Tenant as debtor-in-possession shall make application to
a court of competent jurisdiction for authority and approval to enter into such
assignment and assumption, and Landlord shall thereupon have the prior right
and option, to be exercised by notice to the trustee, Tenant or Tenant as
debtor-in-possession, given at any time prior to the effective date of such
proposed assignment, to accept an assignment of this lease upon the same terms
and conditions and for the same consideration, if any, as the bona fide offer
made by such person, less any brokerage commissions which may be payable out of
the consideration to be paid by such person for the assignment of this lease.

 

ARTICLE 23

 

Reentry by Landlord

 

23.01.                  If Tenant shall default in the payment
of any Fixed Rent or Additional Charges, and such default shall continue for
ten (10) Business Days after Landlord shall have given Tenant notice thereof,
or if this lease shall terminate as provided in Article 22 hereof, Landlord or
Landlord’s agents and employees may immediately or at any time thereafter
reenter the Premises, or any part thereof, either by summary dispossess
proceedings or by any suitable action or proceeding at law, or by force or
otherwise, without being liable to indictment, prosecution or damages therefor,
and may repossess the same, and may remove any person therefrom, to the end
that Landlord may have, hold and enjoy the Premises.  The word “reenter,” as used herein, is not restricted to its technical
legal meaning.  If this lease is
terminated under the provisions of Article 22, or if Landlord shall reenter the
Premises under the provisions of this article, or in the event of the
termination of this lease, or of reentry, by or under any summary dispossess or
other proceeding or action or any provision of law by reason of default
hereunder on the part of Tenant, Tenant shall thereupon pay to Landlord the
Fixed Rent and Additional Charges payable up to the time of such termination of
this lease, or of such recovery of possession of the Premises by Landlord, as
the case may be, and shall also pay to Landlord damages as provided in Article
24 hereof.

 

93

 

23.02.                  In the event of a breach or threatened
breach by Tenant of any of its obligations under this lease, Landlord shall
also have the right of injunction.  The
special remedies to which Landlord may resort hereunder are cumulative and are
not intended to be exclusive of any other remedies to which Landlord may
lawfully be entitled at any time and Landlord may invoke any remedy allowed at
law or in equity as if specific remedies were not provided for herein.

 

23.03.                  If this lease shall terminate under
the provisions of Article 22 hereof, or if Landlord shall reenter the Premises
under the provisions of this Article 23, or in the event of the termination of
this lease, or of reentry, by or under any summary dispossess or other
proceeding or action or any provision of law by reason of default hereunder on the
part of Tenant, Landlord shall be entitled to retain all monies, if any, paid
by Tenant to Landlord, whether as advance rent, security or otherwise, but such
monies shall be credited by Landlord against any Fixed Rent or Additional
Charges due from Tenant at the time of such termination or reentry or, at
Landlord’s option, against any damages payable by Tenant under Article 24
hereof or pursuant to law.

 

ARTICLE 24

 

Damages

 

24.01.                  If this lease is terminated under the
provisions of Article 22 hereof, or if Landlord shall reenter the Premises
under the provisions of Article 23 hereof, or in the event of the termination
of this lease, or of reentry, by or under any summary dispossess or other
proceeding or action or any provision of law by reason of default hereunder on
the part of Tenant, Tenant shall pay to Landlord as damages, at the election of
Landlord, either:

 

(a)                                  a sum which at the time of such
termination of this lease or at the time of any such reentry by Landlord, as
the case may be, represents the then value of the excess, if any, of (i) the
aggregate amount of the Fixed Rent and the Additional Charges under Article 3
hereof which would have been payable by Tenant (conclusively presuming the
average monthly Additional Charges under Article 3 hereof to be the same as
were 

 

94

 

payable for the last 12 calendar months, or
if less than 12 calendar months have then elapsed since the Commencement Date,
all of the calendar months immediately preceding such termination or reentry)
for the period commencing with such earlier termination of this lease or the
date of any such reentry, as the case may be, and ending with the date
contemplated as the expiration date hereof if this lease had not so terminated or
if Landlord had not so reentered the Premises, over (ii) the aggregate rental
value of the Premises for the same period, or

 

(b)                                 sums equal to the Fixed Rent and the
Additional Charges under Article 3 hereof which would have been payable by
Tenant had this lease not so terminated, or had Landlord not so reentered the
Premises, payable upon the due dates therefor specified herein following such
termination or such reentry and until the date contemplated as the expiration
date hereof if this lease had not so terminated or if Landlord had not so
reentered the Premises, provided, however, that if Landlord shall relet the
Premises during said period, Landlord shall credit Tenant with the net rents
received by Landlord from such reletting, such net rents to be determined by
first deducting from the gross rents as and when received by Landlord from such
reletting the expenses incurred or paid by Landlord in terminating this lease
or in reentering the Premises and in securing possession thereof, as well as
the expenses of reletting, including, without limitation, altering and
preparing the Premises for new tenants, brokers’ commissions, legal fees, and
all other expenses properly chargeable against the Premises and the rental
therefrom, it being understood that any such reletting may be for a period
shorter or longer than the remaining term of this lease; but in no event shall
Tenant be entitled to receive any excess of such net rents over the sums
payable by Tenant to Landlord hereunder, nor shall Tenant be entitled in any
suit for the collection of damages pursuant to this subdivision to a credit in
respect of any net rents from a reletting, except to the extent that such net
rents are actually received by Landlord. 
If the Premises or any part thereof

 

95

 

should be relet in combination with other
space, then proper apportionment on a square foot basis shall be made of the
rent received from such reletting and of the expenses of reletting.

 

If the Premises or any part thereof be relet
by Landlord for the unexpired portion of the term of this lease, or any part
thereof, before presentation of proof of such damages to any court, commission
or tribunal, the amount of rent reserved upon such reletting shall, prima
facie, be the fair and reasonable rental value for the Premises, or part
thereof, so relet during the term of the reletting.  Landlord shall not be liable in any way whatsoever for its
failure or refusal to relet the Premises or any part thereof, or if the
Premises or any part thereof are relet, for its failure to collect the rent
under such reletting, and no such refusal or failure to relet or failure to
collect rent shall release or affect Tenant’s liability for damages or
otherwise under this lease.

 

24.02.                  Suit or suits for the recovery of such
damages, or any installments thereof, may be brought by Landlord from time to
time at its election, and nothing contained herein shall be deemed to require
Landlord to postpone suit until the date when the term of this lease would have
expired if it had not been so terminated under the provisions of Article 22
hereof, or had Landlord not reentered the Premises.  Nothing herein contained shall be construed to limit or preclude
recovery by Landlord against Tenant of any sums or damages to which, in
addition to the damages particularly provided above, Landlord may lawfully be
entitled by reason of any default hereunder on the part of Tenant.  Nothing herein contained shall be construed
to limit or prejudice the right of Landlord to prove for and obtain as damages
by reason of the termination of this lease or reentry on the Premises for the
default of Tenant under this lease an amount equal to the maximum allowed by
any statute or rule of law in effect at the time when, and governing the
proceedings in which, such damages are to be proved whether or not such amount
be greater than any of the sums referred to in Section 24.01 hereof.

 

24.03.                  In addition, if this lease is
terminated under the provisions of Article 22 hereof, or if Landlord shall,
reenter the Premises under the provisions of Article 23 hereof, Tenant agrees
that:

 

96

 

(a)                                  the Premises then shall be in the
condition in which Tenant has agreed to surrender the same to Landlord at the
expiration of the term hereof;

 

(b)                                 Tenant shall have performed prior to
any such termination any covenant of Tenant contained in this lease for the
making of any Alterations or for restoring or rebuilding the Premises or the
Building, or any part thereof; and

 

(c)                                  for the breach of any covenant of
Tenant set forth above in this Section 24.03, Landlord shall be entitled
immediately, without notice or other action by Landlord, to recover, and Tenant
shall pay, as and for liquidated damages therefor, the cost of performing such
covenant (as estimated by an independent contractor selected by Landlord).

 

24.04.                  In addition to any other remedies
Landlord may have under this lease, and without reducing or adversely affecting
any of Landlord’s rights and remedies under Article 22, if any Fixed Rent,
Additional Charges or damages payable hereunder by Tenant to Landlord are not
paid within five days after the due date thereof, the same shall bear interest
at the rate of one and one-half (1 1/2%) percent per month or the maximum rate
permitted by law, whichever is less, from the due date thereof until paid, and
the amount of such interest shall be an Additional Charge hereunder.  For the purposes of this Section 24.04, a
rent bill sent by first class mail, to the address to which notices are to be
given under this lease, shall be deemed a proper demand for the payment of the
amounts set forth therein.

 

ARTICLE 25

 

Affirmative Waivers

 

25.01.                  Tenant, on behalf of itself and any
and all persons claiming through or under Tenant, does hereby waive and
surrender all right and privilege which it, they or any of them might have
under or by reason of any present or future law, to redeem the Premises or to
have a continuance of this lease after being dispossessed or ejected therefrom
by process of law or under the terms of this lease or after the termination of
this lease as provided in this lease.

 

97

 

25.02.                  If Tenant is in arrears in payment of
Fixed Rent or Additional Charges, Tenant waives Tenant’s right, if any, to
designate the items to which any payments made by Tenant are to be credited,
and Tenant agrees that Landlord may apply any payments made by Tenant to such
items as Landlord sees fit, irrespective of and notwithstanding any designation
or request by Tenant as to the items which any such payments shall be credited.

 

25.03.                  Landlord and Tenant hereby waive trial
by jury in any action, proceeding or counterclaim brought by either 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 or occupancy of
the Premises, including, without limitation, any claim of injury or damage, and
any emergency and other statutory remedy with respect thereto.

 

25.04.                  Tenant shall not interpose any
counterclaim of any kind in any action or proceeding commenced by Landlord to
recover possession of the Premises except if Tenants failure to raise any such
counterclaim in such action or proceeding shall result in a forfeiture thereof.

 

ARTICLE 26

 

No Waivers

 

26.01.                  The failure of either party to insist
in any one or more instances upon the strict performance of any one or more of
the obligations of this lease, or to exercise any election herein contained,
shall not be construed as a waiver or relinquishment for the future of the
performance of such one or more obligations of this lease or of the right to
exercise such election, and such right to insist upon strict performance shall
continue and remain in full force and effect with respect to any subsequent
breach, act or omission.  The receipt by
Landlord of Fixed Rent or partial payments thereof or Additional Charges or
partial payments thereof with knowledge of breach by Tenant of any obligation
of this lease shall not be deemed a waiver of such breach.

 

26.02.                  If there be any agreement between
Landlord and Tenant providing for the cancellation of this lease upon certain
provisions or contingencies and/or an agreement for the renewal hereof at the
expiration of the term, the right to

 

98

 

such renewal or the
execution of a renewal agreement between Landlord and Tenant prior to the
expiration of the term shall not be considered an extension thereof or a vested
right in Tenant to such further term so as to prevent Landlord from cancelling
this lease and any such extension thereof during the remainder of the original
term provided that said cancellation is in accordance with the terms hereof;
such privilege, if and when so exercised by Landlord, shall cancel and
terminate this lease and any such renewal or extension provided that said
cancellation is in accordance with the terms hereof; any right herein contained
on the part of Landlord to cancel this lease shall continue during any
extension or renewal hereof; any option on the part of Tenant herein contained
for an extension or renewal hereof shall not be deemed to give Tenant any
option for a further extension beyond the first renewal or extended term.

 

ARTICLE 27

 

Curing Defaults

 

27.01.                  If Tenant shall default in the
performance of any of Tenant’s obligations under this lease and such default
shall continue after notice and the expiration of any applicable cure period,
Landlord, any Superior Lessor or any Superior Mortgagee without thereby waiving
such default, may (but shall not be obligated to) perform the same for the
account and at the expense of Tenant, without notice in a case of emergency,
and in any other case only if such default continues after the expiration of
the applicable grace period, if any.  If
Landlord effects such cure by bonding any lien which Tenant is required to bond
or otherwise discharge, Tenant shall obtain and substitute a bond for
Landlord’s bond at its sole cost and expense and reimburse Landlord for the
cost of Landlord’s bond.

 

27.02.                  Bills for any bona fide expenses
incurred by Landlord or any Superior Lessor or any Superior Mortgagee in
connection with any such performance by it for the account of Tenant, and bills
for all costs, expenses and disbursements of every kind and nature whatsoever,
including reasonable counsel fees, involved in collecting or endeavoring to
collect the Fixed Rent or Additional Charges or any part thereof or enforcing
or endeavoring to enforce any rights against Tenant or Tenant’s obligations
hereunder, under or in connection with this lease or pursuant to law, including
any such cost,

 

99

 

expense and disbursement
involved in instituting and prosecuting summary proceedings or in recovering
possession of the Premises after default by Tenant or upon the expiration or
sooner termination of this lease, and interest on all sums advanced by Landlord
or such Superior Lessor or Superior Mortgagee under this Section 27.02 and/or
Section 27.01 (at the Interest Rate or the maximum rate permitted by law,
whichever is less) may be sent by Landlord or such Superior Lessor or Superior
Mortgagee to Tenant monthly, or immediately, at its option, and such amounts
shall be due and payable as Additional Charges in accordance with the terms of
such bills.

 

ARTICLE 28

 

Broker

 

28.01.                  Landlord and Tenant each covenant,
warrant and represent that no broker except Insignia/ESG (herein called the
“Broker”) was instrumental in bringing about or consummating this lease and
that neither had any conversations or negotiations with any broker except the
Broker concerning the leasing of the Premises. 
Tenant agrees to indemnify and hold harmless Landlord against and from
any claims for any brokerage commissions and all costs, expenses and
liabilities in connection therewith, including, without limitation, reasonable
attorneys’ fees and expenses, arising out of any conversations or negotiations
had by Tenant with any broker other than the Broker.  Landlord agrees to indemnify and hold harmless Tenant against and
from any claims for any brokerage commissions and all costs, expenses and
liabilities in connection therewith, including, without limitation, reasonable
attorneys’ fees and expenses, arising out of conversations or negotiations had
by Landlord with any broker other than the Broker.

 

ARTICLE 29

 

Notices

 

29.01.                  Any notice, statement, demand,
consent, approval or other communication required or permitted to be given,
rendered or made by either party to this lease or pursuant to any applicable
law or requirement of public authority (collectively, “notices”) shall be in
writing

 

100

 

(whether or not so stated
elsewhere in this lease) and shall be deemed to have been properly given,
rendered or made only if sent by (x) registered or certified mail, return
receipt requested, posted in a United States post office station or letter box
in the continental United States, or (y) national overnight courier
service (e.g., Federal Express) addressed to the other party as
follows:

 

If to Landlord:

 

BFP One Liberty Plaza Co. LLC

c/o Brookfield Financial Properties, Inc.

One Liberty Plaza

165 Broadway

New York, New York 10006

Attention: 
Director of Leasing

 

with a copy to:

 

BFP One Liberty Plaza Co. LLC

c/o Brookfield Financial Properties, Inc.

One Liberty Plaza

165 Broadway

New York, New York 10006

Attention: 
General Counsel

 

and if to Tenant as follows:

 

Arch Insurance Company

One Liberty Plaza

165 Broadway

New York, New York 10006

Attention: 
President

 

with a copy to:

 

Arch Capital Services Inc.

20 Horseneck Lane

Greenwich, CT.  06830

Attention: 
General Counsel

 

and shall be deemed to have been given,
rendered or made (i) two (2) business days after the day so mailed, unless
mailed outside of the State of New York, in which case it shall be deemed to
have been given, rendered or made on the third business day after the day so
mailed or (ii) one

 

101

 

business day after the day
sent by overnight courier service. 
Either party may, by notice as aforesaid, designate a different address
or addresses for notices intended for it. 
Notwithstanding the foregoing, with respect to an occurrence presenting imminent
danger to the health or safety of persons or damage to property in, on or about
the Building or during a postal strike, notices may be hand delivered to a
party at the address to which notices to that party are to be sent, provided
that the same notice is also sent in the manner set forth above.

 

29.02.                  Notices hereunder from Landlord may be
given by Landlord’s managing agent, if one exists, or by Landlord’s attorney.

 

29.03.                  In addition to the foregoing, either
Landlord or Tenant may, from time to time, request in writing that the other
party serve a copy of any notice on one other person or entity designated in
such request, such service to be effected as provided in Section 29.01 or 29.02
hereof.

 

102

 

ARTICLE 30

 

Estoppel Certificates

 

30.01                     Tenant agrees, at any time and from
time to time, on or prior to the tenth (10th) Business Day following a written
request by Landlord, to execute and deliver to Landlord a statement 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), certifying the Commencement Date, Expiration Date
and the dates to which the Fixed Rent and Additional Charges have been paid,
stating whether or not, to the best knowledge of Tenant, Landlord is in default
in performance of any of its obligations under this lease, and, if so,
specifying each such default of which Tenant shall have knowledge and stating
whether or not, to the best knowledge of Tenant, any event has occurred which
with the giving of notice or passage of time, or both, would constitute such a
default, and, if so, specifying each such event, it being intended that any
such statement delivered pursuant hereto shall be deemed a representation and
warranty to be relied upon by Landlord requesting the certificate and by others
with whom Landlord may be dealing, regardless of independent
investigation.  Tenant also shall
include or confirm in any such statement such other information concerning this
lease as Landlord may reasonably request.

 

ARTICLE 31

 

Memorandum of Lease

 

31.01.                  Tenant shall not record this lease or
any memorandum thereof.

 

ARTICLE 32

 

No Representations by Landlord

 

32.01.                  Tenant expressly acknowledges and
agrees that Landlord has not made and is not making, and Tenant, in executing
and delivering this lease, is not relying upon, any warranties,
representations, promises or statements, except as are expressly set forth in
this lease or in any other written agreement which may be made between the
parties concurrently with the execution and delivery of this lease and shall
expressly refer to this lease.  All
understandings and agreements heretofore had between the parties are merged in
this lease and any other written agreement(s) made

 

103

 

concurrently herewith,
which alone fully and completely express the agreement of the parties and which
are entered into after full investigation, neither party relying upon any
statement or representation not embodied in this lease or any other
written agreement(s) made concurrently herewith.

 

ARTICLE 33

 

Arbitration

 

33.01.                  In the event either party shall desire
to submit to arbitration any matter for which arbitration is expressly provided
pursuant to any provision of this lease, unless otherwise expressly provided
herein, the following procedure shall apply:

 

(a)                                The party desiring arbitration shall
give notice to that effect to the other party, specifying the matter to be
arbitrated and the name and address of the person designated to act as an
arbitrator on its behalf.  Within ten
(10) days after the service of such notice, the other party shall give notice
to the first party specifying the name and address of the person designated to
act as an arbitrator on its behalf.  If
the second party fails to notify the first party of the appointment of its
arbitrator, as aforesaid, within the time above specified, then the appointment
of the second arbitrator shall be made in the same manner as hereinafter
provided for the appointment of a third arbitrator in a case where the two
arbitrators appointed hereunder and the parties are unable to agree upon such
appointment.  The two arbitrators so chosen
shall meet within ten (10) days after the second arbitrator is appointed and
if, within fifteen (15) days after the second arbitrator is appointed, the two
arbitrators shall not agree upon the question in dispute, upon the request of
either party the two arbitrators shall together appoint a third
arbitrator.  In the event of their being
unable to agree upon such appointment within twenty-five (25) days after the
appointment of the second arbitrator, the third arbitrator shall be selected by
the parties themselves if they can agree thereon within a further period of ten
(10) days.  If the parties do not so
agree, then either party, on behalf of both and on notice to the other, may
request such appointment by the American Arbitration Association (or any organization
successor thereto) in accordance with its rules then prevailing.  Each arbitrator chosen or appointed pursuant
to this Article shall be a person

 

104

 

having at least seven (7)
years experience in the County of New York in the leasing, operation, renting
of space or management of first-class office buildings in midtown Manhattan,
and shall be a disinterested person in connection with such question in
dispute.

 

(b)                                 Any arbitration pursuant to this Article
33 shall be conducted, to the extent consistent with this Article, in
accordance with the then-prevailing rules of the American Arbitration
Association (or any organization successor thereto) governing binding
arbitration in the City and County of New York.  In rendering such decision and award, the arbitrators shall not
add to, subtract from or otherwise modify the provisions of this lease.  Judgment may be had on the decision and
award of the arbitrators so rendered and may be enforced in accordance with the
laws of the State of New York.

 

(c)                                  If for any reason whatsoever the
written decision and award of the arbitrators shall not be rendered within
sixty (60) days after the appointment of the third arbitrator, either party may
apply to the Supreme Court of the State of New York or to any other court
having jurisdiction and exercising the functions similar to those now exercised
by such court, by action, proceeding or otherwise (but not by a new arbitration
proceeding) as may be proper to determine the question in dispute consistent
with the provisions of this lease.

 

(d)                                 Each party shall pay the fees and
expenses of the one of the two original arbitrators appointed by or for such
party, and the fees and expenses of the third arbitrator and all other expenses
of the arbitration shall be borne by the parties equally.  However, each party shall bear the expense
of its own counsel, experts and presentation of proof.

 

(e)                                  In the event (i) the arbitrators shall
award judgment solely to either party (the “Prevailing Party”), and (ii) the
other party (the “Non-Prevailing Party”) shall not comply with the terms of
such judgment, and (iii) the Prevailing Party shall commence an action to
enforce the judgment, and (iv) the Prevailing Party is successful in such action,
then the Non-Prevailing Party will pay the Prevailing Party’s reasonable
attorney’s fees in connection with the enforcement of the arbitrators’
judgment.

 

105

 

ARTICLE 34

 

Holdover

 

34.01.                  (a)                                  In the event this lease is not renewed
or extended or a new lease is not entered into between the parties, and if
Tenant shall then hold over after the expiration of the term of this lease, and
if Landlord shall then not proceed to remove Tenant from the Premises in the
manner Permitted by law (or shall not have given written notice to Tenant that
Tenant must vacate the Premises) irrespective of whether or not Landlord
accepts rent from Tenant for a period beyond the Expiration Date, the parties
hereby agree that Tenant’s occupancy of the Premises after the expiration of
the term shall be under a month-to-month tenancy commencing on the first
day after the expiration of the term, which tenancy shall be upon all of the
terms set forth in this lease except Tenant shall pay on the first day of each
month of the holdover period as Fixed Rent, an amount equal to the higher of
(i) an amount equal to one and one-half times one-twelfth of the sum of:   (a) the Fixed Rent and Additional Charges
payable by Tenant during the last year of the term of this lease (i.e.,
the year immediately prior to the holdover period) or (ii) an amount equal to
the then market rental value for the Premises as shall be established by
Landlord giving notice to Tenant of Landlord’s good faith estimate of such
market rental value.  Tenant may dispute
such market rental value for the Premises as estimated by Landlord by giving
notice to Landlord within but in no event after ten days after the giving of
Landlord’s notice to Tenant (as to the giving of which notice to Landlord, time
shall be deemed of the essence). 
Enclosed with such notice, Tenant shall be required to furnish to
Landlord a certified opinion of a reputable New York licensed real estate
broker having leasing experience in the Borough of Manhattan, for a period of
not less than ten (10) years setting forth said broker’s good faith opinion of
the market rental value of the Premises. 
If Tenant and Landlord are unable to resolve any such dispute as to the
market rental value for the Premises then an independent arbitrator who shall
be a real estate broker of similar qualifications and shall be selected from a
listing of not less than three (3) brokers furnished by the Real Estate Board
of New York, Inc. to Tenant and Landlord (at the request of either Landlord or
Tenant).  If Landlord and Tenant are
unable to agree upon the selection of the individual arbitrator from such
listing, then the first arbitrator so listed by the Real Estate Board of New
York, Inc. shall be 

 

106

 

conclusively presumed to
have been selected by both Landlord and Tenant and the decision of such
arbitrator shall be conclusive and binding upon the parties as to the market
rental value for the Premises.  Pending
the determination of the market rental value of the Premises upon the
expiration of the term of this lease, Tenant shall pay to Landlord as Fixed
Rent an amount computed in accordance with clauses (i) or (ii) of this
subsection 34.01(a) (as Landlord shall then elect), and upon determination of
the market rental value of the Premises in accordance with the preceding
provisions hereof appropriate adjustments and payments shall be effected.  Further, Landlord shall not be required to
perform any work, furnish any materials or make any repairs within the Premises
during the holdover period.  It is
further stipulated and agreed that if Landlord shall, at any time after the
expiration of the original term or after the expiration of any term created
thereafter, proceed to remove Tenant from the Premises as a holdover, the Fixed
Rent for the use and occupancy of the Premises during any holdover period shall
be calculated in the same manner as set forth above.  In addition to the foregoing, Landlord shall be entitled to
recover from Tenant any losses or damages arising from such holdover.

 

(b)                                 Notwithstanding anything to the
contrary contained in this lease, the acceptance of any rent paid by Tenant
pursuant to subsection 34.01(a) above shall not preclude Landlord from
commencing and prosecuting a holdover or summary eviction proceeding, and the
preceding sentence shall be deemed to be an “agreement expressly providing
otherwise” within the meaning of Section 232-c of the Real Property Law of the
State of New York.

 

(c)                                  If Tenant shall hold-over or remain in
possession of any portion of the Premises for more than ninety (90) days after
the Expiration Date, Tenant shall be subject not only to summary proceeding and
all damages related thereto, but also to any damages arising out of any lost
opportunities (and/or new leases) by Landlord to re-let the Premises (or any
part thereof).  All damages to Landlord
by reason of such holding over by Tenant may be the subject of a separate
action and need not be asserted by Landlord in any summary proceedings against
Tenant.

 

107

 

ARTICLE 35

 

Miscellaneous Provisions and Definitions

 

35.01.                  No agreement shall be effective to
change, modify, waive, release, discharge, terminate or effect an abandonment
of this lease, in whole or in part, including, without limitation, this Section
35.01, unless such agreement is in writing, refers expressly to this lease and
is signed by the party against whom enforcement of the change, modification,
waiver, release, discharge, termination or effectuation of the abandonment is
sought.  If Tenant shall at any time
request Landlord to sublet the Premises for Tenant’s account, Landlord or its
agent is authorized to receive keys for such purposes without releasing Tenant from
any of its obligations under this lease, and Tenant hereby releases Landlord of
any liability for loss or damage to any of the Tenant’s Property in connection
with such subletting.

 

35.02.                  Except as otherwise expressly provided
in this lease, the obligations of this lease shall bind and benefit the
successors and assigns of the parties hereto with the same effect as if
mentioned in each instance where a party is named or referred to; provided,
however, that (a) no violation of the provisions of Article 7 shall operate to
vest any rights in any successor or assignee of Tenant and (b) the provisions
of this Article 35 shall not be construed as modifying the conditions of
limitation contained in Article 22.

 

35.03.                  Tenant shall look only to Landlord’s
estate and property in the Land and the Building for the satisfaction of
Tenant’s remedies, for the collection of a judgment (or other judicial process)
requiring the payment of money by Landlord in the event  of any default by Landlord hereunder, and no
other property or assets of Landlord or its partners, officers, directors,
shareholders or principals, disclosed or undisclosed, shall be subject to levy,
execution or other enforcement procedure for the satisfaction of Tenant’s
remedies under or with respect to this lease, the relationship of Landlord and
Tenant hereunder or Tenant’s use or occupancy of the Premises.

 

35.04.                  (a)                                  The obligations of Tenant hereunder
shall be in no wise affected, impaired or excused, nor shall Landlord have any
liability whatsoever to Tenant, nor shall it be deemed a constructive eviction
because (a) Landlord is unable to fulfill, or is delayed in fulfilling, any of
its obligations under this lease by reason of strike, lock-out or other labor
trouble, governmental preemption of priorities or

 

108

 

other controls in
connection with a national or other public emergency or shortages of fuel,
supplies or labor resulting therefrom, or any other cause, whether similar or
dissimilar, beyond Landlord’s reasonable control other than the financial
impairment of Landlord or any affiliate of Landlord, or (b) of any failure or
defect in the supply, quantity or character of electricity or water furnished
to the Premises, by reason of any requirement, act or omission of the public
utility or others serving the Building with electric energy, steam, oil, gas or
water, or for any other reason whether similar or dissimilar, beyond Landlord’s
reasonable control.

 

(b)                                 Subject to the provisions of Section
27.01 hereof, Tenant shall not be deemed to be in default hereunder or have any
liability to Landlord if Tenant is unable to fulfill, or is delayed in
fulfilling, any of its obligations under this lease other than the payment of
Fixed Rent or Additional Charges, by reason of strike, lockout or other labor
trouble, governmental preemption of priorities or other controls in connection
with a national or other public emergency or shortages of fuel, supplies or
labor resulting therefrom, or any cause whether similar or dissimilar beyond
Tenant’s reasonable control (but the lack of financial resources of Tenant
shall not be deemed to be a cause beyond Tenant’s reasonable control).

 

35.05.                  For the purposes of this lease, the
following terms have the meanings indicated:

 

(a)                                  The term “mortgage” shall include a
mortgage and/or a deed of trust, and the term “holder of a mortgage” or
“mortgagee” or words of similar import shall include an mortgagee of a mortgage
or a beneficiary of a deed of trust.

 

(b)                                 The term “laws and requirements of any
public authorities” and words of a similar import shall mean laws and
ordinances of any or all of the federal, state, city, town, county, borough and
village governments and rules, regulations, orders and directives of any and
all departments, subdivisions, bureaus, agencies or offices thereof, and of any
other governmental, public or quasi-public authorities having jurisdiction over
the Building and/or the Premises, and the direction of any public officer
pursuant to law, whether now or hereafter in force.

 

109

 

(c)                                  The term “requirements of insurance
bodies” and words of similar import shall mean rules, regulations, orders and
other requirements of the New York Board of Underwriters and/or the New York
Fire Insurance Rating Organization and/or any other similar body performing the
same or similar functions and having jurisdiction or cognizance over the
Building and/or the Premises, whether now or hereafter in force.

 

(d)                                 The term “Tenant” shall mean the
Tenant herein named or any assignee or other successor in interest (immediate
or remote) of the Tenant herein named, which at the time in question is the
owner of the Tenant’s estate and interest granted by this lease; but the
foregoing provisions of this subsection shall not be construed to permit any
assignment of this lease or to relieve the Tenant herein named or any assignee
or other successor in interest (whether immediate or remote) of the Tenant
herein named from the full and prompt payment, performance and observance of
the covenants, obligations and conditions to be paid, performed and observed by
Tenant under this lease.

 

(e)                                  The term “Landlord” shall mean only
the owner at the time in question of Landlord’s interest in the Land or a lease
of the Land and the Building or a lease thereof, so that in the event of any
transfer or transfers of Landlord’s interest in the Land or a lease thereof or
the Building, the transferor shall be and hereby is relieved and freed of all
obligations of Landlord under this lease accruing after such transfer, and it
shall be deemed, without further agreement that such transferee has assumed and
agreed to perform and observe all obligations of Landlord herein during the
period it is the holder of Landlord’s interest under this lease.

 

(f)                                    The terms “herein,” hereof” and
“hereunder,” and words of similar import, shall be construed to refer to this
lease as a whole, and not to any particular article or section, unless
expressly so stated.

 

(g)                                 The term “and/or” when applied to one
or more matters or things shall be construed to apply to any one or more or all
thereof as the circumstances warrant at the time in question.

 

110

 

(h)                                 The term “person” shall mean any
natural person or persons, a partnership, a corporation, and any other form of
business or legal association or entity.

 

(i)                                     The terms “Landlord shall have no
liability to Tenant” or “the same shall be without liability to Landlord” or
“without incurring any liability to Tenant therefor”, or words of similar
import shall mean that Tenant is not entitled to terminate this lease, or to
claim actual or constructive eviction, partial, or total, or to receive any
abatement or diminution of rent, or to be relieved in any manner of any of its
other obligations hereunder, or to be compensated for loss or injury suffered
or to enforce any other right or kind of liability whatsoever against Landlord
under or with respect to this lease or with respect to Tenant’s use or
occupancy of the Premises.

 

(j)                                     The term “Interest Rate,” when used in
this lease, shall mean an interest rate equal to two percent (2%) above the
so-called annual “Base Rate” of interest established and approved by Citibank,
N.A., New York, New York, from time to time, as its interest rate charged for
unsecured loans to its corporate customers, but in no event greater than the
highest lawful rate from time to time in effect.

 

(k)                                  The term “Consumer Price Index” if
used herein shall mean the Consumer Price Index for All Urban Consumers
published by the Bureau of Labor Statistics of the United States Department of
Labor, New York, N.Y. - Northeastern N.J. Area, All Items (1982-84 = 100), or
any successor index thereto, appropriately adjusted.  In the event that the Consumer Price Index is converted to a
different standard reference base or otherwise revised, the determination of
adjustments provided for herein shall be made with the use of such conversion
factor, formula or table for converting the Consumer Price Index as may be
published by the Bureau of Labor Statistics or, if said Bureau shall not
publish the same, then with the use of such conversion factor, formula or table
as may be published by Prentice-Hall, Inc., or any other nationally recognized
publisher of similar statistical information. 
If the Consumer Price Index ceases to be published, and there is no
successor thereto, such other index as Landlord and Tenant shall agree upon in
writing shall be substituted for the Consumer Price Index.  If Landlord and Tenant are unable to agree
as to such substituted index, such matter shall be submitted to the American
Arbitration

 

111

 

Association (or any
successor organization thereto) for determination in accordance with the
regulations and procedures thereof then obtaining for commercial arbitration.

 

35.06.                  Upon the expiration or other
termination of this lease neither party shall have any further obligation or
liability to the other except as otherwise expressly provided in this lease and
except for such obligations as by their nature or under the circumstances can
only be, or by the provisions of this lease, may be, performed after such
expiration or other termination; and, in any event, unless otherwise expressly
provided in this lease, any liability for a payment (including, without
limitation, Additional Charges under Article 3) which shall have accrued to or
with respect to any period ending at the time of expiration or other
termination of this lease shall survive the expiration or other termination of
this lease.

 

35.07.                  If Tenant shall request Landlord’s
consent and Landlord shall fail or refuse to give such consent, Tenant shall
not be entitled to any damages for any withholding by Landlord of its consent,
it being intended that Tenant’s sole remedy shall be an action for specific
performance or injunction, and that such remedy shall be available only in
those cases where Landlord has expressly agreed in writing not to unreasonably
withhold its consent or where as a matter of law Landlord may not unreasonably
withhold its consent.

 

35.08.                  If any Superior Mortgagee shall
require any modification(s) of this lease, Tenant shall, at Landlord’s request,
promptly execute and deliver to Landlord such instruments effecting such
modification(s) as Landlord shall require, provided that such modification(s)
do not adversely affect in any material respect any of Tenant’s rights under
this lease.

 

35.09.                  If an excavation shall be made upon
land adjacent to or under the Building, or shall be authorized to be made,
Tenant shall afford to the person causing or authorized to cause such
excavation, license to enter the Premises for the purpose of performing such
work as said person shall deem necessary or desirable to preserve and protect
the Building from injury or damage to support the same by proper foundations,
without any claim for damages or liability against Landlord and without
reducing or otherwise affecting Tenant’s obligations under this lease.

 

112

 

35.10.                  Tenant shall not place a load upon any
floor of the Premises which violates applicable law or the certificate of
occupancy of the Building or which exceeds the floor load per square foot which
such floor was designed to carry (which Landlord represents is fifty (50)
pounds live load per usable square foot of the Premises).  All heavy material and/or equipment must be
placed by Tenant, at Tenant’s expense, so as to distribute the weight.  Business machines and mechanical equipment
shall be placed and maintained by Tenant, at Tenant’s expense, in settings
sufficient in Landlord’s reasonable judgment to absorb and prevent vibration,
noise and annoyance.  If the Premises be
or become infested with vermin as a result of the use or any misuse or neglect
of the Premises by Tenant, its agents, employees, visitors or licensees, Tenant
shall at Tenant’s expense cause the same to be exterminated from time to time
to the reasonable satisfaction of Landlord and shall employ such exterminators
and such exterminating company or companies as shall be reasonably approved by
Landlord.

 

35.11.                  The submission by Landlord of the
lease in draft form shall be deemed submitted solely for Tenant’s consideration
and not for acceptance and execution. 
Such submission shall have no binding force or effect and shall confer
no rights nor impose any obligations, including brokerage obligations, on
either party unless and until both Landlord and Tenant shall have executed the
lease and duplicate originals thereof shall have been delivered to the
respective parties.

 

35.12.                  Irrespective of the place of execution
or performance, this lease shall be governed by and construed in accordance
with the laws of the State of New York. 
If any provisions of this lease or the application thereof to any person
or circumstance shall, for any reason and to any extent, be invalid or
unenforceable, the remainder of this lease and the application of that
provision to other persons or circumstances shall not be affected but rather
shall be enforced to the extent permitted by law.  The table of contents, captions, headings and titles in this
lease are solely for convenience of references and shall not affect its
interpretation.  This lease shall be
construed without regard to any presumption or other rule requiring
construction against the party causing this lease to be drafted.  Each covenant, agreement, obligation or
other provision of this lease on Tenant’s part to be performed, shall be deemed
and construed as a separate and independent covenant of Tenant,

 

113

 

not dependent on any other
provision of this lease.  All terms and
words used in this lease, shall be deemed to include any other number and any
other gender as the context may require.

 

35.13.                  If under the terms of this lease
Tenant is obligated to pay Landlord a sum in addition to the Fixed Rent under
the lease and no payment period therefor is specified, Tenant shall pay
Landlord the amount due within twenty (20) days after being billed.

 

35.14.                  Notwithstanding anything to the
contrary contained in this lease, during the continuance of any default by
Tenant after notice and the expiration of any applicable cure period, Tenant
shall not be entitled to exercise any rights or options, or to receive any
funds or proceeds being held, under or pursuant to this lease; provided,
however, that any such funds or proceeds shall either be held by Landlord for
Tenant’s account or applied by Landlord against amounts owed by Tenant
hereunder.

 

35.15.                  Tenant represents and warrants:

 

(a)                                  That there are no actions, suits or
proceedings pending or, to the knowledge of Tenant, threatened against or
affecting Tenant, at law or in equity or before any federal, state, municipal
or governmental department, commission, board, bureau, agency or
instrumentality which would impair Tenant’s ability to perform its obligations
under this lease;

 

(b)                                 That this lease has been duly
authorized, executed and delivered by Tenant and constitutes the legal, valid
and binding obligation of Tenant; and

 

(c)                                  That the consummation of the
transactions hereby contemplated and the performance of this lease will not
result in any breach or violation of, or constitute a default under any lease,
bank loan or credit agreement to which Tenant is a party.

 

35.16.                  Tenant acknowledges that it has no
rights to any development rights, “air rights” or comparable rights appurtenant
to the Real Property, and consents, without further consideration, to any
utilization of such rights by Landlord and agrees to promptly execute and
deliver any instruments which may be requested by Landlord, including
instruments merging zoning lots, evidencing such

 

114

 

acknowledgment and consent.  The provisions of this Section 35.16 shall
be deemed to be and shall be construed as an express waiver by Tenant of any
interest Tenant may have as a “party in interest” (as such quoted term is
defined in Section 12-10 Zoning Lot of the Zoning Resolution of the City of New
York) in the Real Property.

 

35.17.                  If any sales or other tax is payable
with respect to any cleaning or other services which Tenant obtains or
contracts for directly from any third party or parties, Tenant shall file any
required tax returns and shall pay any such tax, and Tenant shall indemnify and
hold Landlord harmless from and against any loss, damage or liability suffered
or incurred by Landlord on account thereof.

 

35.18.                  If any additional space to be included
within the Premises shall not be available for occupancy by Tenant on the
specific date hereinbefore designated for the commencement of the term of this
lease or for the inclusion of such space for any reason whatsoever, then this
lease shall not be affected thereby but, in such case, said specific date shall
be deemed to be postponed until the date when the additional space shall be
available for occupancy by Tenant, and Tenant shall not be entitled to
possession of the additional space until the same are available for occupancy
by Tenant; provided, however, Tenant shall have no claim against Landlord with
respect to such additional space, and Landlord shall have no liability to
Tenant by reason of any such postponement of said specific date, and the
parties hereto further agree that any failure to have the Premises or such
additional space available for occupancy by Tenant on said specific date or on
the Commencement Date shall in no way affect the obligations of Tenant
hereunder nor shall the same be construed in any way to extend the Term.  This Section 35.18 shall be deemed to be an
express provision to the contrary of Section 223-a of the Real Property Law of
the State of New York and any other law of like import now or hereafter in
force.

 

35.19.                  In connection with any examination by
Tenant of Landlord’s books and records, Tenant agrees to treat, and to instruct
its employees, accountants and agents to treat, all information as confidential
and not disclose it to any other person; and Tenant will confirm or cause its agents
and accountants to confirm such agreement in a separate written agreement if
requested by Landlord.

 

115

 

35.20.                  Tenant shall not cause or permit
“Hazardous Materials” (as defined below) to be used, transported, stored,
released, handled, produced or installed in, on or from, Tenant’s premises or
the Building.  The term “Hazardous
Materials” shall, for the purposes hereof, mean any flammable explosives,
radioactive materials, hazardous wastes, hazardous and toxic substances, or
related materials, asbestos or any material containing asbestos, or any other
substance or material, as defined by any federal, state or local environmental
law, ordinance, rule or regulation including, without limitation, the Comprehensive
Environmental Response Compensation and Liability Act of 1980, as amended, the
Hazardous Materials Transportation Act, as amended, the Resource Conservation
and Recovery Act, as amended, and in the regulations adopted and publications
promulgated pursuant to each of the foregoing. 
In the event of a breach of the provisions of this Section 35.20,
Landlord shall, in addition to all of its rights and remedies under this lease
and pursuant to law, require Tenant to remove any such Hazardous Materials from
the Premises in the manner prescribed for such removal by Legal
Requirements.  The provisions of this
Section 35.20 shall survive the termination of this lease.  Nothing contained in this Section 35.20
shall be construed to limit Tenant’s rights at law against Landlord with
respect to the existence of Hazardous Materials within the Premises which were
not installed therein by Tenant, its subtenants, other than Landlord or its
designee, or licensees or any of their respective agents or employees or contractors.

 

35.21.                  Notwithstanding anything to the
contrary contained in this Lease, any option or right to extend or renew the
original term of this Lease and any option or right to add additional space to
the Premises originally demised hereunder (the foregoing options and rights are
herein collectively called “Tenant’s Options”) shall, in the event any of
Tenant’s Options is expressly set forth in this Lease inure exclusively to the
benefit of the Tenant named herein and its affiliates and shall be exercisable
only by the Tenant named herein and its affiliates.

 

35.22.                  Tenant covenants and agrees that
Tenant shall not exercise any of Tenant’s Options for the purpose of assigning
this Lease or subletting all or any portion of the Premises.

 

35.23.                  Landlord and Tenant agree that except
for the express waivers and disclaimers set forth herein, nothing 

 

116

 

stated or omitted in this lease shall be
deemed a waiver by either party of any legal rights or remedies Landlord or
Tenant may have at law.

 

ARTICLE 36

 

Extension of Term

 

36.01.                  (a)                                  Subject to the provisions of Section
36.04 hereof, Tenant, at Tenant’s sole option, shall have the right to extend
the term of this lease for an additional term of five (5) years commencing on
the day following the expiration of the initial term of this lease (herein
referred to as the “Commencement Date of the Extension Term”) and ending on the
day immediately preceding the fifth (5th) anniversary of the Commencement Date
of the Extension Term (such additional term is herein called the “Extension
Term”) provided that:

 

(i)                                     Tenant shall give Landlord notice
(herein called the “Extension Notice”) of its election to extend the term of
the lease prior to the date which is eighteen (18) months before the Expiration
Date;

 

(ii)                                  Tenant shall not be in default after
notice and the expiration of any applicable cure under this lease either as of
the time of the giving of the Extension Notice or the Commencement Date of the
Extension Term (provided, however, that the foregoing requirement may be waived
by Landlord, in its sole discretion, at any time); and

 

(iii)                               The Tenant originally named in the
preamble of this lease (herein called the “Named Tenant”) and/or any affiliate
of the Named Tenant shall, as of the Commencement Date of the Extension Term,
be in actual occupancy of not less than eighty percent (80%) percent of the
rentable square foot area of the Premises, provided that such occupancy
requirement may be waived by Landlord in its sole discretion.

 

(b)                                 The Fixed Rent payable by Tenant to
Landlord during the Extension Term shall be 100% of the fair market rent for
the Premises during the Extension Term, as determined by Landlord, subject to
the provisions of Section 36.02 hereof.

 

117

 

The fair market rent for the Premises shall
be determined by Landlord as of the date (herein called the “Determination
Date”) occurring six (6) months prior to the Commencement Date of the Extension
Term and which determination shall be given in writing to Tenant within a
reasonable period of time after the occurrence of the Determination Date.

 

For the purposes of determining the fair
market rent for the Extension Term pursuant to this Article 36, the determination
shall take into account all then relevant factors.

 

Effective as of the Commencement Date of the
Extension Term, (1) the Base Operating Amount shall be the Operating Expenses
for the calendar year in which occurs the Commencement Date of the Extension
Term; and (2) the Base Tax Amount shall be the Taxes for the last complete Tax
Year in which occurs the Commencement Date of the Extension Term, as finally
determined.

 

36.02.                  (a)           In
the event Tenant gives the Extension Notice in accordance with the provisions
of Section 36.01 hereof and Tenant disputes the fair market rent as determined
by Landlord pursuant to subsection 36.01(b) hereof, then at any time on or
before the date occurring thirty (30) days after Tenant has been notified by
Landlord of Landlord’s determination of the fair market rent, Tenant may
initiate the arbitration process provided for herein by giving notice to that
effect to Landlord, and if Tenant so initiates the arbitration process such
notice shall specify the name and address of the person, designated to act as
an arbitrator on its behalf.  If Tenant
fails to initiate the arbitration process as provided above, time being of the
essence, then Landlord’s determination of the Fixed Rent during the Extension
Term shall be conclusive.  Within thirty
(30) days after the Landlord’s receipt of notice of the designation of Tenant’s
arbitrator, Landlord shall give notice to Tenant specifying the name and
address of the person designated to act as an arbitrator on its behalf.  Neither Landlord nor Landlord’s arbitrator
shall be bound by nor shall any reference be made to the determination of the
Fixed Rent for the Premises during the Extension Term which was furnished by
Landlord in response to Tenant’s Extension Notice.  If Landlord fails to notify Tenant of the appointment of its
arbitrator within the time above specified, then Tenant shall provide an
additional notice to Landlord requiring Landlord’s

 

118

 

appointment of an arbitrator within twenty
(20) days after Landlord’s receipt thereof. 
If Landlord fails to notify Tenant of the appointment of its arbitrator
within the time specified by the second notice, the appointment of the second
arbitrator shall be made in the same manner as hereinafter provided for the
appointment of a third arbitrator in a case where the two arbitrators appointed
hereunder and the parties are unable to agree upon such appointment.  The two arbitrators so chosen shall meet within
ten (10) days after the second arbitrator is appointed, and if, within sixty
(60) days after the second arbitrator is appointed, the two arbitrators shall
not agree upon a determination of the Fixed Rent for the Extension Term, they
shall together appoint a third arbitrator. 
In the event of their being unable to agree upon such appointment within
eighty (80) days after the appointment of the second arbitrator, the third
arbitrator shall be selected by the parties themselves if they can agree
thereon within a further period of fifteen (15) days.  If the parties do not so agree, then either
party, on behalf of both and on notice to the other, may request such
appointment by the American Arbitration Association (or any organization
successor thereto) in accordance with its rules then prevailing or if the
American Arbitration Association (or such successor organization) shall fail to
appoint said third arbitrator within fifteen (15) days after such request
is made, then either party may apply, on notice to the other, to the Supreme
Court, New York County, New York (or any other court having jurisdiction and
exercising functions similar to those now exercised by said Court) for the
appointment of such third arbitrator. 
The majority of the arbitrators shall determine the fair market rent of
the Premises for the Extension Term and render a written certified report of
their determination to both Landlord and Tenant within sixty (60) days of the
appointment of the first two arbitrators or sixty (60) days from the
appointment of, the third arbitrator, if such third arbitrator is appointed
pursuant to this Section 36.02; and the fair market rent, so determined, shall
be applied to determine the Fixed Rent for the Premises during the Extension
Term provided, however, that in no event shall the Fixed Rent for the Extension
Term be less than the Original Term Escalated Rent.

 

(b)                                 Each party shall pay the fees and
expenses of the one of the two original arbitrators appointed by or for such
party, and the fees and expenses of the third arbitrator and all other expenses
(not including the attorneys’ fees, witness fees and similar expenses of the
parties which shall

 

119

 

be borne separately by each of the parties)
of the arbitration shall be borne by the parties equally.

 

(c)                                  Each of the arbitrators selected as
herein provided shall have at least ten (10) years experience in the leasing
and renting of office space in first class office buildings in New York County.

 

(d)                                 In the event the Tenant initiates the
aforesaid arbitration process and as of the Commencement Date of the Extension
Term the amount of the fair market rent has not been determined, Tenant shall
pay the amount determined by Landlord to be the fair market rent for the
Premises and when the determination has actually been made, an appropriate
retroactive adjustment shall be made as of the Commencement Date of the
Extension Term.  In the event that such
determination shall result in an overpayment by Tenant of any Fixed Rent, such
overpayment shall be paid by Landlord to Tenant promptly after such
determination.

 

(e)                                  If Landlord notifies Tenant that the
Fixed Rent for the Extension Term shall be equal to the Original Term Escalated
Rent, then the foregoing provisions of this Section 36.02 shall be inapplicable
and of no force or effect.

 

36.03.                  Except as provided in Section 36.01
hereof, and unless the context shall otherwise require, Tenant’s occupancy of
the Premises during the Extension Term shall be on the same terms and
conditions as are in effect immediately prior to the expiration of the initial
term of this lease provided, however, (i) Tenant shall have no further right to
extend the term of this lease pursuant to this Article 36, (ii) Tenant shall
not be entitled to any abatement of Fixed Rent or Additional Charges or any of
the work, allowances or credits provided for in Article 2 hereof, and (iii) the
Fixed Rent, Operating Payments and Tax Payments during the Extension Term shall
be determined as provided in subsection 36.01(b) hereof.

 

36.04.                  If Tenant does not timely send the
Extension Notice pursuant to the provisions of Section 36.01 hereof, this
Article 36 shall have no force or effect and shall be deemed deleted from this
lease.  Time shall be of the essence
with respect to the giving of the Extension Notice.  The termination of this lease during the initial term hereof
shall also terminate and render void any option or right on Tenant’s part to
extend the term of this lease pursuant to

 

120

 

this Article 36 whether or not such option or
right shall have theretofore been exercised; provided, however, if Tenant shall
have exercised any option prior to a termination by reason of Tenant’s default
hereunder, then damages shall be calculated pursuant to Article 24 hereof as if
said options were validly effectuated. 
None of Tenant’s options or elections set forth in this Article 36 may
be severed from this lease or separately sold, assigned or transferred.

 

36.05.                  If Tenant exercises its right to extend
the term of this lease for the Extension Term pursuant to this Article 36, the
phrases “the term of this lease” or the “term hereof” as used in this lease,
shall be construed to include the Extension Term, and the Expiration Date shall
be construed to be the date of the expiration of the Extension Term.

 

36.06.                  If this lease is renewed for the
Extension Term, then Landlord or Tenant can request the other party hereto to
execute, acknowledge and deliver, and the other party shall so execute,
acknowledge and deliver an instrument in form for recording setting forth the
exercise of Tenant’s right to extend the term of this lease and the last day of
the Extension Term.

 

36.07.                  Notwithstanding any language to the
contrary contained in this lease, Landlord and Tenant agree that the rights
contained in this Article 36 are for the sole benefit of the Named Tenant and
no person or entity other than the Named Tenant (and Landlord or Landlord’s
designee if Landlord or its designee shall receive an assignment of this lease
pursuant to the provisions of Section 7.07 hereof) shall be entitled to
exercise any right granted by this Article 36.

 

ARTICLE 37

 

The Lower Manhattan Plan

 

37.01.                  (a)                                  (i)                                     For
purposes of this Article 37, unless otherwise defined in this Lease, all terms
used herein shall have the meanings ascribed to them in Title 4 of Article 4 of
the New York Real Property Tax Law (herein called the “Lower Manhattan Plan”).

 

121

 

(ii)                                  For
purposes of the Lower Manhattan Plan, Tenant’s Percentage Share shall mean
Tenant’s Share (i.e., 2.1%).

 

(b)                                 (i)                                     For
so long as Tenant continues to be eligible for the real estate tax abatement
benefits of the Lower Manhattan Plan (herein called the “LMP Abatement
Benefits”) with respect to the demised premises, Landlord agrees to comply with
the provisions and requirements of the Lower Manhattan Plan and the rules
promulgated thereunder as same relate to the demised premises and to Landlord
(in connection with Tenant’s eligibility for the LMP Abatement Benefits);
provided, however, that Tenant shall promptly pay to Landlord, as additional
rent hereunder, the amount of any out-of-pocket costs incurred by Landlord in
connection with such compliance, including, without limitation, the amount of
any administrative charges or fees imposed by the New York City Department of
Finance (herein called the “Department”) in connection with such compliance.

 

(ii)                                  Tenant
agrees to comply with the provisions and requirements of the Lower Manhattan
Plan and the rules promulgated thereunder as same relate to the demised
premises; and Tenant shall indemnify and hold harmless Landlord and all
Superior Lessors and Superior Mortgagees and its and their respective partners,
directors, officers, principals, shareholders, agents and employees from and
against any and all claims arising from or in connection with Tenant’s failure
to so comply, together with all costs, expenses and liabilities incurred in
connection with each such claim or action or proceeding brought thereon,
including, without limitation, all attorneys’ fees and expenses.

 

(c)                                  (i)                                     In
accordance with the Lower Manhattan Plan and notwithstanding anything to the
contrary contained in this Lease, Landlord agrees to allow Tenant a credit
against the fixed annual rent and the recurring additional rent (including Tax
Payments) payable by Tenant hereunder in an amount that, in the aggregate,
equals the full amount of any abatement of real estate taxes granted for the
demised premises pursuant to the Lower Manhattan Plan and actually received by
Landlord (herein called the “Actual LMP Benefits”).  Landlord shall, within thirty (30) days after its receipt of the
Actual LMP Benefits, credit the full amount thereof against the next
installment(s) of fixed annual rent and/or additional rent becoming due
hereunder.

 

(ii)                                  Tenant
shall promptly pay to Landlord, as additional rent hereunder, the amount of all
or any portion of the Actual LMP Benefits that have been credited against fixed
annual rent and/or additional rent becoming due hereunder, and which are
thereafter revoked (including, without limitation, if such Actual LMP Benefits
are revoked due to the exercise by Tenant of its right to assign or sublease
pursuant to Article 7 hereof), together with any interest and/or penalties
imposed against Landlord in connection with such Actual LMP Benefits.

 

122

 

(d)                                 (i)                                     In
accordance with Section 499-C(5) of the Lower Manhattan Plan, Landlord agrees
and informs Tenant that the availability of the LMP Abatement Benefits are
subject to the following:

 

(1)                                  an
application for abatement of real property taxes pursuant to Title 4 of Article
4 of the New York Real Property Tax Law will be made for the demised premises;

 

(2)                                  the
rent, including amounts payable by Tenant for real property taxes, will
accurately reflect any abatement of real property taxes granted pursuant to
Title 4 of Article 4 of the New York Real Property Tax Law for the demised
premises;

 

(3)                                  at
least thirty-five ($35) dollars per square foot must be spent on improvements
to the demised premises and the common areas; and

 

(4)                                  all
abatements granted with respect to the Building pursuant to Title 4 of Article
4 of the New York Real Property Tax Law will be revoked if, during the Benefit
Period, real estate taxes or water or sewer charges or other lienable charges
are unpaid for more than one year, unless such delinquent amounts are paid as
provided in subdivision four of section four hundred ninety-nine-f of Title 4
of the New York Real Property Tax Law.

 

(ii)                                  Nothing
contained herein (including, without limitation, the provisions of Section
37.01(d)(i)(3) hereof), shall be construed to impose any obligation on Landlord
to perform, or (except as provided in the next sentence) to incur any cost for,
any improvements to the demised premises and/or the common areas to establish
Tenant’s eligibility for the LMP Abatement Benefits.  Landlord hereby acknowledges and agrees that Tenant may apply all
or any portion of the Work Allowance toward satisfying the requirement of the
Lower Manhattan Plan that at least thirty-five ($35) dollars per square foot be
spent on improvements to the demised premises and the common areas.

 

(e)                                  Landlord
covenants and agrees that (i) Landlord shall timely pay all real estate taxes,
water and sewer charges and other lienable charges that become due and payable
during the period for which Tenant is entitled to receive the LMP Abatement
Benefits and (ii) there shall be no real estate taxes, water and sewer charges
or other lienable charges due and owing with respect to the Land or the
Building on the date the Abatement Application (as hereinafter defined) is
filed with the Department, unless such real property

 

123

 

taxes or
charges are being paid in timely installments pursuant to a written agreement
with the Department or other appropriate agency.

 

(f)                                    (i)                                     Landlord,
upon not less than ten (10) Business Days advance written notice from Tenant,
agrees to cooperate with Tenant to execute, deliver and file, together with the
Abatement Application (as hereinafter defined), the affidavit required by
Section 499-C(7) of the Lower Manhattan Plan.

 

(ii)                                  Landlord,
upon not less than ten (10) Business Days advance written notice from Tenant,
agrees to cooperate with Tenant to execute, deliver and file, on a timely
basis, an application (the “Abatement Application”) for a certificate of
abatement in accordance with Section 499-D of the Lower Manhattan Plan.  Landlord further agrees to provide all other
information required by the Department pursuant to Section 499-D of the Lower
Manhattan Plan and to otherwise comply with the provisions of said Section
499-D.

 

(iii)                               For
so long as Tenant continues to be eligible for the LMP Abatement Benefits with
respect to the demised premises, Landlord, upon not less than ten (10) Business
Days advance written notice from Tenant, agrees to cooperate with Tenant to
annually execute, deliver and file a certificate of continuing eligibility in
accordance with Section 499-F of the Lower Manhattan Plan.

 

(iv)                              Tenant
shall promptly pay to Landlord, as additional rent hereunder, the amount of any
out-of-pocket costs incurred by Landlord in connection with the performance of
Landlord’s obligations pursuant to this Section 37.01(f), including, without
limitation, the amount of any administrative charges or fees imposed by the
Department in connection with such compliance.

 

(g)           In the event that
Landlord shall default in the performance or observance of any of the
covenants, terms, provisions or conditions on its part to be performed or
observed under this Article 37, this Lease shall remain unaffected thereby and
shall continue in full force and effect, and Landlord’s liability for such default,
if any, shall be limited to the payment of damages which shall in no event
exceed the aggregate amount of the LMP Abatement Benefits with respect to the
demised premises to which Tenant would have been entitled but for such default.

 

(h)           Notwithstanding
anything contained in this Article 37, Landlord makes no representation or
warranty as to the amount, if any, of Actual LMP Benefits that will be received
by Landlord.

 

124

 

ARTICLE 38

 

Layout and Finish

 

38.01.                  (a)                                  Tenant
hereby covenants and agrees that Tenant will, at Tenant’s own cost and expense,
and in a good and workmanlike manner, make and complete the work and
installations in and to the Premises set forth below appropriate for a first
class office building in the Borough of Manhattan, City of New York.

 

(b)                                 Tenant,
at Tenant’s expense, shall prepare a final plan or final set of plans and
specifications (which said final plan or final set of plans, as the case may
be, and specifications are herein called the “final plan”) which shall contain
complete information and dimensions necessary for the construction and
finishing of the Premises and for the engineering in connection therewith.  The final plan shall be submitted by Tenant
to Landlord no later than ninety (90) days from the date hereof, for Landlord’s
written approval, which approval shall not be unreasonably withheld or
delayed.  If Landlord shall disapprove
the final plan, Landlord shall set forth its reasons for such disapproval and
itemize those portions of the final plan so disapproved.  Without limitation of any other provisions
of this lease, Landlord may withhold its consent if the final plan prepared by
Tenant pursuant hereto involves the performance of work or the installation in
the Premises of materials or equipment which do not equal or exceed the
standard of quality appropriate for a first class office building in the
Borough of Manhattan, City of New York adopted by Landlord for the
Building.  At such time as Tenant
submits the final plans to Landlord for Landlord’s approval Tenant shall advise
Landlord in writing of the general contractor(s) or construction manager which
Tenant is considering using for the performance of Tenant’s Work; which such
general contractors shall, to the extent permitted by law, use employees for
Tenant’s Work who will work harmoniously with other employees on the job.  Subject to the provisions of
Section 38.02(c) and Article 11, such general contractor(s) and all
subcontractors shall be subject to Landlord’s prior written approval.

 

(c)                                  In
accordance with the final plan, Tenant, at Tenant’s expense, will make and
complete in and to the Premises (herein sometimes called the “Work Area”) the
work and installations (herein called “Tenant’s Work”) specified in the final
plan.  Tenant agrees that Tenant’s Work
will be performed with the least possible disturbance to the occupants of other
parts of the Building and to the structural and mechanical parts of the
Building and Tenant will, at its own cost and expense leave all structural and
mechanical parts of the Building which shall or may be affected by Tenant’s
Work in good operating condition. 
Tenant, in performing Tenant’s Work will, at its own cost and expense,
promptly comply with all laws, rules and regulations of all public authorities
having jurisdiction in the Building with reference to Tenant’s Work.  Tenant shall not do or fail to do any act
which

 

125

 

shall or may
render the Building of which the Premises are a part, liable to any mechanic’s
lien or other lien and if any such lien or liens be filed against the Building
of which the Premises are a part, or against Tenant’s Work, or any part
thereof, Tenant will, at Tenant’s own cost and expense, promptly remove the
same of record in accordance with the provisions of Article 11 hereof; or
in default thereof, Landlord may cause any such lien or liens to be removed of
record by payment of bond or otherwise, as Landlord may elect, and Tenant will
reimburse Landlord for all costs and expenses incidental to the removal of any
such lien or liens incurred by Landlord. 
Landlord agrees to notify Tenant promptly of any lien of which Landlord
receives notice.  Tenant shall indemnify
and save harmless Landlord for all costs and expenses incidental to the removal
of any such lien or liens incurred by Landlord.  Except and to the extent that Tenant’s Work shall be performed by
Landlord, Tenant shall indemnify and save harmless Landlord of and from all
claims, counsel fees, loss, damage and expenses whatsoever by reason of any
liens, charges or payments of any kind whatsoever that may be incurred or
become chargeable against Landlord or the Building of which the Premises are a
part, or Tenant’s Work or any part thereof, by reason of any work done or to be
done or materials furnished or to be furnished to or upon the Premises in
connection with Tenant’s Work.  Tenant
hereby covenants and agrees to indemnify and save harmless Landlord of and from
all claims, counsel fees, loss, damage and expenses whatsoever by reason of any
injury or damage, howsoever caused, to any person or property occurring prior
to the completion of Tenant’s Work or occurring after such completion, as a
result of anything done or omitted in connection therewith or arising out of
any fine, penalty or imposition or out of any other matter or thing connected
with any work done or to be done or materials furnished or to be furnished in
connection with Tenant’s Work.  At any
and all times during the progress of Tenant’s Work, Landlord shall be entitled
to have a representative or representatives on the site to inspect Tenant’s
Work and such representative or representatives shall have free and
unrestricted access to any and every part of the Premises; provided, however,
that Landlord shall incur no liability, obligation or responsibility to Tenant
or any third party by reason of such access and inspection.

 

(d)                                 Tenant
shall at Tenant’s sole cost and expense file all necessary architectural plans
and obtain all necessary approvals and permits in connection with Tenant’s Work
being performed by it pursuant to this Article.  Landlord shall cooperate upon Tenant’s request with Tenant’s
efforts to obtain all necessary permits provided
that Landlord shall incur no expense nor any liability in connection therewith.

 

38.02.                  The
following conditions shall also apply to Tenant’s Work:

 

(a)                                  all
Tenant’s Work shall be of material, manufacture, design, capacity and color at
least the standard appropriate for a first class office building comparable to
the Building (herein called “Building Standard”);

 

126

 

(b)                                 Tenant,
at Tenant’s expense shall (i) file all required architectural, mechanical
and electrical drawings and obtain all necessary permits, and (ii) furnish
and perform all engineering and engineering drawings in connection with
Tenant’s Work.  Tenant shall obtain
Landlord’s approval of the drawings referred to in clauses (i) and (ii) of
this subsection 38.02(b) which approval shall not be unreasonably withheld
or delayed.

 

(c)                                  Tenant
shall use the engineer designated by Landlord with respect to the preparation
of Tenant’s engineering drawings in connection with Tenant’s Work; Tenant shall
use the contractors designated by Landlord in connection with the performance
of all electrical and mechanical work to be performed in the Premises as a
portion of Tenant’s Work.

 

(d)                                 All
Tenant’s Work shall be performed by Tenant in accordance with Article 11
hereof and the Alterations Rules and Regulations attached hereto as
Exhibit E.

 

38.03.                  It
is understood that of the services to be furnished by Landlord referred to in
Article 15 hereof, Landlord shall not furnish any cleaning services until
Tenant commences occupancy of the Premises for the conduct of its
business.  Tenant shall be responsible
for removal of Tenant’s refuse and rubbish during the period that Tenant’s Work
is in progress in the Premises.

 

38.04.                  Landlord
shall be reimbursed by Tenant, as additional rent hereunder, for any costs or
expenses paid or incurred by Landlord in connection with any request by Tenant
(which shall be in writing) that Landlord cooperate with Tenant or render
assistance to Tenant in connection with the performance of any Tenant’s Work.

 

38.05.                  (a)                                  Landlord
shall allow Tenant an allowance in the amount of SIX HUNDRED SEVENTY-SIX
THOUSAND EIGHT HUNDRED FORTY-FIVE and 00/100 ($676,845.00) DOLLARS (herein
called the “Work Allowance”), which Work Allowance shall be applied solely
against the cost and expense of the actual construction work performed by
Tenant in connection with Tenant’s Work in the Premises (and work performed by
Tenant as licensee under that certain “License Agreement” [as hereinafter
defined]), which shall include the installation costs for telephone wiring,
network and audio-visual cabling; provided,
however, that Tenant shall have the right to apply up to an
aggregate of One Hundred Thirty-Five Thousand Three Hundred Sixty Nine and
00/100 ($135,369.00) Dollars of the Work Allowance to design consultant’s,
architect’s and engineer’s fees and Tenant’s reasonable out-of-pocket moving
expenses incurred to relocate

 

127

 

Tenant’s
furniture, fixtures and equipment to the Premises (collectively, “Soft
Costs”).  In the event that the cost and
expense of such actual construction work and Soft Costs shall exceed the amount
of the Work Allowance, Tenant shall be entirely responsible for such excess.  If Tenant does not use all or any part of
the Work Allowance for Tenant’s Work and Soft Costs, then the Work Allowance
shall be reduced accordingly.  For
purposes hereof, the License Agreement 
referred to above means that certain License Agreement, dated as of June
27, 2002, between Zurich American Insurance Company, as licensor, and Tenant,
as licensee, covering the fifty-third (53rd) floor of the Building (other than
the computer room located thereon).

 

(b)                                 The
Work Allowance shall be payable to Tenant in installments as Tenant’s Work
progresses, but in no event more frequently than monthly.  Prior to the payment of any such
installment, Tenant shall deliver to Landlord a written request for
disbursement which shall be accompanied by (1) paid invoices for the
portion of Tenant’s Work referenced in such requisition, (2) a certificate
signed by Tenant’s architect and an officer of Tenant certifying that the
portion of Tenant’s Work referenced in said requisition and represented by the
aforesaid invoices has been satisfactorily completed in accordance with Tenant’s
final plan, (3) partial lien waivers (in recordable form and form
satisfactory to Landlord) from contractors, subcontractors and all materialmen
who shall have performed any such work releasing Tenant for liability for the
same.  Landlord shall be permitted to
retain from each disbursement an amount equal to 5% of the amount requested to
be disbursed by Tenant.  The aggregate
amount of the retainages shall be paid by Landlord to Tenant upon completion of
Tenant’s Work and upon receipt from Tenant of (i) a certificate signed by
Tenant’s architect and an officer of Tenant certifying that Tenant’s Work has
been satisfactorily completed in accordance with the final plan, (ii) all
Building Department sign-offs, inspection certificates and any permits required
to be issued by any governmental entities having jurisdiction thereover, and
(iii) a general release from all contractors and subcontractors performing
Tenant’s Work releasing Landlord and Tenant from all liability for any Tenant’s
Work.

 

(c)                                  At
any and all times during the progress of Tenant’s Work, representatives of
Landlord shall have the right of access to the Premises and inspection thereof
and Landlord shall have the right to withhold payment of any portion of the
Work Allowance representing the reasonably estimated cost of any such work not
being performed in a manner reasonably satisfactory to Landlord; provided, however,
that Landlord shall incur no liability, obligation or responsibility to Tenant
or any third party by reason of such access and inspection.

 

128

 

(d)                                 The
Work Allowance is being given for the benefit of Tenant only.  No third party shall be permitted to make
any claims against Landlord or Tenant with respect to any portion of the Work
Allowance.

 

ARTICLE 39

 

Condominium

 

39.01.                  On or about December 19, 2000, the
Land and the Building were subjected to the provisions of Article 9-B of the
New York Real Property Law (herein called the “Condominium Act”), thereby
creating The One Liberty Plaza Condominium (herein called the “Condominium”) in
accordance with that certain Declaration Establishing a Plan for Condominium
Ownership of Premises Located at One Liberty Plaza, New York, New York Pursuant
to Article 9-B of the Real Property Law of the State of New York (herein called
the “Condominium Declaration”).  The
units of the Condominium are sometimes referred to herein individually as a
“Unit” and collectively as “Units.”  The
Condominium was formed for the sole purpose of facilitating the receipt by a
tenant of the Building (herein called the “Tax-Benefit Tenant”) of certain tax
benefits, which was accomplished by: (i) creating the Condominium, (ii)
conveying the Units containing the premises theretofore demised to the
Tax-Benefit Tenant (herein called the “IDA Units”) to the New York City
Industrial Development Agency (herein called the “IDA”), a tax-exempt entity,
with Landlord retaining a reversionary interest and (iii) requiring the IDA to
immediately lease back the IDA Units to Landlord pursuant to a lease demising
to Landlord all of benefits and burdens of ownership of the IDA Units (herein
called, together with any additional such leases that may be entered into as
set forth in the immediately following sentence hereof, the “IDA Leaseback”).  Pursuant to Landlord’s lease with the
Tax-Benefit Tenant (herein called the “Tax-Benefit Lease”), Landlord may from
time to time convey additional Units to the IDA in the same manner as set forth
in the immediately preceding sentence in connection with the leasing of
additional premises in the Building to the Tax-Benefit Tenant.

 

39.02.                  As more particularly set forth in the
Condominium Declaration, it is intended that Landlord, as either the owner or
the holder of an IDA Leaseback with respect to all of the Units of the
Condominium, will operate

 

129

 

the entire Land and the entire Building as if
Landlord were the owner of the entire Land and the entire Building and the Land
and the Building were not owned in the condominium form of ownership.  Accordingly, the terms and conditions of
this Lease shall be administered in the same manner as would be the case if
Landlord were the sole fee simple owner of the Land and the Building outside
the condominium form of ownership and nothing contained in the Condominium
Declaration (including, without limitation, the By-Laws of the Condominium
annexed thereto), as same may be amended from time to time, shall be construed
to increase Tenant’s obligations or diminish Tenant’s rights under this Lease.

 

39.03.                  On or about December 19, 2000,
Landlord’s predecessor-in-interest, WFP One Liberty Plaza Co. L.P., entered
into an agreement with The City of New York (herein called the “Tax Agreement”)
pursuant to which, notwithstanding the subdivision of the  pre-existing single tax lot for the Land and
the Building (herein called the “Existing Tax Lot”) into individual tax lots
for each of the Units (herein called the “New Tax Lots”) in connection with the
formation of the Condominium:

 

(i)                  the aggregate assessed real estate tax
value (herein called the “Aggregate Value”) of the New Tax Lots will be the
same as the assessed value that the Existing Tax Lot would have received from
time to time had the Existing Tax Lot not been subjected to condominium status
and not been subdivided into the New Tax Lots;

 

(ii)               each New Tax Lot will have an assessed
real estate tax value equal to its share of the Aggregate Value, which will be
the same percentage share assigned to the corresponding Unit in the Condominium
Declaration;

 

(iii)            Landlord will have the right to
contest the Aggregate Value only with respect to all of the New Tax Lots in the
aggregate, and will not have the right to contest the assessed real estate tax
value for one or more Units on an individual basis;

 

130

 

(iv)           the City of New York will accept as
valid a single application for review of assessed valuation and a single
petition for judicial review of assessed valuation, each of which shall (x)
aggregate the assessments of the New Tax Lots, (y) state a single aggregated
value for the aggregated New Tax Lots and (z) be a single request for
assessment reduction of the Aggregate Value of the New Tax Lots;

 

(v)              any reductions in the Aggregate Value
will be apportioned in accordance with the percentage shares assigned to the
Units in the Condominium Declaration; and

 

(vi)           the income and expense statements
required pursuant to Section 11-208.1 of the Administrative Code of the City of
New York and any other statements, documents or instruments required to be
submitted by Landlord relating to the assessment of real estate taxes shall in
each case be submitted for all of the New Tax Lots as a single whole, and not
for any individual Unit.

 

39.04.                  Notwithstanding anything to the
contrary contained in this Lease, for purposes of applying the provisions of
Article 3 of the Lease with respect to the calculation of the Tax Payment
payable by Tenant from time to time, Landlord and Tenant hereby agree that the
Taxes “payable” by Landlord for any Tax Year shall be deemed to be the same
amount of Taxes that would otherwise be “payable” by Landlord with respect to
the Real Property but for the exemption of any IDA Units from one or more
components of Taxes for such Tax Year (i.e., as if the Land and the
Building had not been subjected to the provisions of the Condominium Act).  Thus, there shall be added to the Taxes
actually payable by Landlord with respect to any such Tax Year,  the aggregate amount of Taxes from which any
IDA Units are exempted for such Tax Year (herein called the “Exempted Tax
Amount”).  In computing the Exempted Tax
Amount, any tax abatement or exemption that would otherwise apply to the IDA
Units, but for their pre-existing exemption from Taxes, shall

 

131

 

be taken into account.  Thus, for example, if in any Tax Year the
City of New York institutes a program providing for an across-the-board
five percent (5%) abatement of Taxes payable with respect to commercial office
buildings in Manhattan, said five percent (5%) abatement shall be taken into
account in computing the Exempted Tax Amount.

 

39.05.                  Notwithstanding anything to the
contrary contained in
this Lease, the provisions of the first sentence of Section 3.02(b) of the
Lease shall not apply to any refund of Taxes received by Landlord for any Tax
Year if and to the extent that such refund consists of Taxes paid with respect
to any IDA Unit for a period of time that such IDA Unit was exempt from such
Taxes (e.g., if an IDA Unit is conveyed by Landlord to the IDA, there is
a delay in taking such IDA Unit off of the City’s tax rolls and Taxes are paid
by Landlord with respect to such IDA Unit for a period with respect to which such
IDA Unit is exempt from such Taxes).

 

39.06.                  Notwithstanding anything to the
contrary contained in Section 3.01(e) of this Lease, the term “Operating
Expenses” shall not include common charges of the Condominium, if and to the extent that such
common charges duplicate or are in excess of amounts otherwise properly
includable in Operating Expenses in accordance with the terms and conditions of
this Lease (i.e., the determination of whether and to what extent an
item of expense is includable as an Operating Expense in accordance with the
terms and conditions of this Lease shall be made without regard to whether the
amount of such item is payable by Landlord as part of common charges or
directly to a third party).

 

39.07.                  Landlord hereby represents and warrants
that (i) the Premises are part of a Unit owned by Landlord; (ii) Landlord has
full right, power and authority to enter into this lease and (iii) in no event
shall Tenant be responsible for any Operating Payment or Tax Payment in excess
of those amounts that would be payable by Tenant pursuant to the provisions of
Article 3 hereof in the absence of the condominium form of ownership.

 

132

 

ARTICLE 40

 

Tenant’s Antenna

 

40.01.                  Landlord agrees that, subject to all
applicable Legal Requirements and further subject to the conditions and
limitations hereinafter stipulated, Tenant shall have the right, during
the term of this lease, at Tenant’s sole cost and expense, to install on a
portion of the rooftop of the Building and to thereafter maintain, repair, and
operate a communications antenna or microwave dish (herein called, together
with related support structures, wires, cables and other equipment, the
“Antenna”) as an incident to the conduct of Tenant’s business in the Premises,
provided and on condition that:

 

(i)                       as
of the date that Tenant submits Tenant’s plans and specifications for the
Antenna, Landlord shall have available for use by Tenant sufficient space on
the roof of the Building, in Landlord’s reasonable judgment, for Tenant’s
Antenna;

 

(ii)                    Landlord,
in its reasonable judgment, shall designate the portion of the rooftop for such
installation (herein called the “Antenna Space”), and from and after the date
that Landlord makes the Antenna Space available to Tenant, Tenant shall pay to
Landlord, as Additional Charges, Landlord’s then-customary monthly rent for the
use of the Antenna Space (on a pro-rata basis, based on the number of rentable
square feet contained in the Antenna Space);

 

(iii)                 the
size and dimensions of the Antenna, including any reasonably required support
structures, shall be subject to Landlord’s prior consent, such consent not to
be unreasonably withheld or delayed;

 

(iv)                no
such equipment shall extend higher than the parapet of the roof of the
Building;

 

(v)                   the
installation and position of such Antenna, including any reasonably required
support structures, shall comply with all applicable Legal Requirements and any
or all rules, regulations, orders and other requirements of the New York Board
of Underwriters and/or the New York Fire Insurance Rating Organization and/or
any other similar body performing the same or similar functions and having
jurisdiction or cognizance over the Building and/or the Antenna Space, whether
now or hereafter in force (herein collectively called the “Antenna Legal
Requirements”);

 

(vi)                the
installation of any electrical or communications lines (“Wiring”) and related
equipment in connection with the installation and operation of the

 

133

 

Antenna, as
well as the manner and location (i.e., routing) of all Wiring and related
equipment in connection therewith shall (A) be at Tenant’s sole cost and
expense, (B) be subject to Landlord’s prior consent, such consent not to be
unreasonably withheld or delayed, (C) comply with the Antenna Legal
Requirements and (d) be performed in accordance with all applicable terms,
covenants and conditions of this lease, including the provisions of Article 11
hereof;

 

(vii)             the
Antenna, including all support structures, Wiring and related equipment, shall
be maintained and kept in repair by Tenant, at Tenant’s sole cost and expense;
and

 

(viii)          all
plans and specifications for the work and installations performed by Tenant
pursuant to this Article 40, and the manner of installation thereof, shall be
subject to the prior approval of Landlord, such approval not to be unreasonably
withheld or delayed.  Such work and
installations shall be further subject to inspection and reasonable supervision
by Landlord.

 

The parties
acknowledge and agree that Tenant’s use of the rooftop of the Building is a
nonexclusive use and that Landlord has permitted and may permit, in the future,
the use of other portions of the roof by any other persons, firms or corporations
for such use as Landlord may determine in its sole discretion, including the
installation of other antennas and support equipment.

 

40.02.                  For
the purpose of installing, servicing or repairing the Antenna and related
equipment, Tenant shall have access to the rooftop of the Building upon prior
reasonable request of Landlord.  All
access by Tenant to the rooftop of the Building shall be subject to the
reasonable supervision and control of Landlord and to Landlord’s reasonable
safeguards for the security and protection of the Building, the Building
equipment and installations and equipment of other tenants and occupants of the
Building as may be located on the rooftop of the Building.  Landlord shall have the right to assign a
Building representative to be present during the duration of Tenant’s access to
the roof and Tenant shall pay to Landlord the amount of Landlord’s commercially
reasonable charges therefor as Additional Charges hereunder.

 

40.03.                  Tenant,
at Tenant’s sole cost and expense, shall promptly and faithfully obey, observe
and comply with all laws, ordinances, regulations, requirements and rules of
all duly constituted public authorities in any manner affecting or relating to
Tenant’s use of said roof as to the installation, repair, maintenance and
operation of the Antenna, including any support structures and related
equipment erected or installed by Tenant pursuant to the provisions of this
Article 40.  Tenant, at Tenant’s sole
cost and expense, shall

 

134

 

secure and
thereafter maintain all permits and licenses required for the installation,
operation, maintenance or replacement of the Antenna, including any support
structures and related equipment erected or installed by Tenant pursuant to the
provisions of this Article 40, including, without limitation, any approval,
license or permit required from the Federal Communications Commission.  In no event shall the maximum level of
microwave emissions from the Antenna exceed an amount equal to Tenant’s
proportionate share, as reasonably determined by Landlord, of the total
microwave emissions allowable for the Building as determined by the
governmental authorities having jurisdiction thereof.

 

40.04.                  Tenant
shall pay for all electrical service required for Tenant’s use of the Antenna
and related equipment erected or installed by Tenant pursuant to the provisions
of this Article 40 in accordance with Article 14 hereof.  Tenant further agrees that such electrical
service shall feed off the same supply of electrical energy furnished to the
Premises as provided in Article 14 hereof.

 

40.05.                  The
Antenna, including any support structures and related equipment installed by
Tenant pursuant to the provisions of this Article 40, shall be Tenant’s personal
property, and, upon the expiration or earlier termination of the term of this
lease, shall be removed by Tenant at Tenant’s sole cost and expense to the
extent required pursuant to and in accordance with the provisions of Section
12.01 hereof.  All Wiring and related
electrical equipment installed by Tenant in connection with the installation
and operation of the Antenna shall be Tenant’s personal property.  Upon the expiration or earlier termination
of the term of this lease, if Landlord so directs by written notice to Tenant,
Tenant shall promptly remove such Wiring and electrical equipment as designated
in such notice, at Tenant’s sole cost and expense.  Tenant, at Tenant’s sole cost and expense, shall promptly repair
any and all damage to the rooftop of the Building and to any other part of the
Building caused by or resulting from the installation, maintenance and repair,
operation or removal of the Antenna, including any support structures, Wiring
and related equipment erected or installed by Tenant pursuant to the provisions
of this Article 40, and restore said affected areas to their condition as
existed prior to the installation thereof, subject to normal wear and tear and
damage by fire or other casualty not caused by Tenant.

 

40.06.                  Tenant
agrees to accept the Antenna Space in its “as is” condition and agrees that
Landlord shall be under no obligation to perform any work or incur any expense
in connection with the installation, operation or maintenance of the Antenna,
including all support structures, Wiring, cabling and related electrical and
other equipment, and/or in connection with Tenant’s use of the Antenna
Space.  Tenant agrees that Landlord
shall not be required to provide any services whatsoever to the Antenna Space
or to the rooftop of the Building except as may otherwise be expressly provided
in this Article 40.

 

135

 

40.07.                  Tenant
covenants and agrees that all installations made by Tenant on the rooftop of
the Building or in any other part of the Building pursuant to the provisions of
this Article 40 shall be at the sole risk of Tenant, and neither Landlord nor
Landlord’s agents or employees shall be liable for any damage or injury thereto
caused in any manner, except to the extent caused by the negligence or willful
misconduct of Landlord, its agents or employees.

 

40.08.                  Tenant
will, and does hereby, indemnify and save harmless Landlord and its managing
agent (and Landlord’s mortgagee, if any) from and against:  (i) any and all claims, reasonable counsel
fees, demands, damages, expenses or losses by reason of any liens, orders,
claims or charges resulting from any work done, or materials or supplies
furnished, in connection with the fabrication, erection, installation,
maintenance and operation of the Antenna, including any support structures,
Wiring and any related equipment installed by Tenant pursuant to the provisions
of this Article 40; and (ii) any and all claims, costs, demands, expenses, fees
or suits arising out of accidents, damage, injury or loss to any and all
persons and property, or either, whomsoever or whatsoever resulting from or
arising in connection with the erection, installation, maintenance and
operation and repair of the Antenna, including any support structures, Wiring and
related equipment installed by Tenant 
pursuant to the provisions of this Article 40, except to the extent
caused by the negligence or willful misconduct of Landlord, its agents or
employees.  If the Antenna is installed,
Tenant shall obtain and thereafter maintain during the term of this lease
insurance coverage for the benefit of Landlord and its managing agent (and
Landlord’s mortgagee, if any) in such amount and of such type as Landlord may
reasonably require and which is consistent with that required by landlords of
comparable buildings in lower Manhattan. 
If any installations referred to in this Article 40 should revoke,
negate or in any manner impair or limit any roof warranty or guaranty obtained
by Landlord, then Tenant shall reimburse Landlord for any loss or damage
sustained or costs or expenses incurred by Landlord as a result thereof.

 

40.09.                  Tenant
covenants and agrees that the Antenna, including any support structures, Wiring
and related electrical equipment to be installed by Tenant, shall not interfere
with or adversely affect any of Landlord’s equipment, installations, lines or
machinery, or the use, repair, maintenance or removal thereof.  Tenant shall cooperate reasonably with any
other tenant or person (herein called a “Roof User”) having equipment,
installations, lines or machinery on the roof of the Building (herein called
“Rooftop Installations”) so as not to cause (or to eliminate) any interference
or adverse effect caused to such Rooftop Installations or the use, repair,
maintenance or removal thereof by the Antenna, and Landlord shall cooperate
reasonably and shall use reasonable efforts to cause any Roof User to cooperate
reasonably with Tenant so as not to cause (or to eliminate) any interference or
adverse effect caused to the Antenna or the use, repair, maintenance or removal
thereof by Landlord’s or such Roof User’s Rooftop Installations.

 

136

 

40.10.                  Tenant
acknowledges being advised by Landlord that Landlord has granted, and shall be
granting, to third parties, various rights and licenses to utilize various
portions of the Building and rooftop thereof for the installation of microwave
dishes, satellite communications equipment, whip antennae and other
communications equipment and related equipment (all of the foregoing are herein
collectively referred to as “Other Communications Equipment”) and that,
inasmuch as Landlord’s ability to facilitate the installation and operation of
such Other Communications Equipment will be of paramount importance to
Landlord, Landlord shall have the right, at any time and from time to time
during the term of this lease, upon thirty (30) days’ prior written notice to
Tenant, to relocate the Antenna to other areas of the Building and rooftop
thereof as Landlord in its sole discretion may determine so as to accommodate
such Other Communications Equipment on the roof of the Building and so as to
eliminate, or not to create, problems of interference with respect to or
between Other Communications Equipment now, or in the future, installed on the
roof or other areas of the Building. 
Such relocation shall, to the extent practicable, be performed during
hours other than Tenant’s regular business hours so as to minimize any
disruption of Tenant’s normal business activities and except for such downtime
such relocation shall not prevent Tenant from using its Antenna for its
original intended purpose, without any material decrease in the quality of
communications or material increase in the cost of operating, maintaining,
repairing and removing the Antenna. 
Tenant shall cooperate with Landlord to effectuate the relocation of
Tenant’s Antenna, including any support structures and related equipment as
shall be required by Landlord.  All
costs involved in such relocation shall be borne by Landlord and such
relocation shall be performed by Landlord in compliance with all applicable
Legal Requirements.

 

40.11.                  Tenant
shall not be permitted to assign or transfer all or any portion of the rights
granted to Tenant pursuant to this Article 40 or to permit all or any portion
of the Antenna Space to be used or occupied by any person or entity other than
Tenant, unless Tenant assigns this lease to the party to whom such rights are
assigned or transferred pursuant to Article 7 hereof or unless Tenant subleases
all or substantially all of the Premises pursuant to Article 7 hereof, in which
case such subtenant shall have the rights of Tenant hereunder for so long as
such sublease shall be in full force and effect.

 

 

[NEXT PAGE IS SIGNATURE
PAGE]

 

137

 

IN WITNESS WHEREOF, Landlord and Tenant have
duly executed this lease as of the day and year first above written.

 

 

	
   

  	
  BFP ONE LIBERTY PLAZA CO. LLC, Landlord

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  WFP One Liberty Plaza Co. L.P., its sole
  member

  
	
   

  	
   

  
	
   

  	
  By:

  	
  WFP One Liberty Plaza Co. G.P. Corp., its
  general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeremiah
  B. Larkin

  	
   

  
	
   

  	
   

  	
  Name: Jeremiah B. Larkin

  
	
   

  	
   

  	
  Title: Senior Vice President 

  
	
   

  	
   

  	
  Director of Leasing

  
	
   

  	
   

  
	
   

  	
  ARCH INSURANCE COMPANY, Tenant

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ramin
  Taraz

  	
   

  
	
   

  	
   

  	
  Name: Ramin Taraz

  
	
   

  	
   

  	
  Title: Controller

  
											

 

Tenant’s Federal
Identification Number:

 

138

 

	
  STATE OF NEW YORK

  	
  )

  	
   

  
	
   

  	
  )

  	
  ss.

  
	
  COUNTY OF NEW YORK

  	
  )

  	
   

  

 

On the
          day of
                     
in the year 2002, before me, the undersigned, a Notary Public in and for said
state, personally appeared
                                               
personally known to me or proved to me on the basis of satisfactory evidence to
be the person(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) as
                      
of
                                                    ,
and that by his/her/their signature(s) on the instrument, the person(s), or the
entity upon behalf of which the person(s) acted, executed the instrument.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  

 

 

 

	
  STATE OF NEW YORK

  	
  )

  	
   

  
	
   

  	
  )

  	
  ss.

  
	
  COUNTY OF NEW YORK

  	
  )

  	
   

  

 

On the
          day of
                     
in the year 2002, before me, the undersigned, a Notary Public in and for said
state, personally appeared
                                               
personally known to me or proved to me on the basis of satisfactory evidence to
be the person(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) as
                      
of
                                                    ,
and that by his/her/their signature(s) on the instrument, the person(s), or the
entity upon behalf of which the person(s) acted, executed the instrument.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  

 

139

 

EXHIBIT A

 

Description of Land

 

ALL those certain plots, pieces or parcels of
land, situate, lying and being in the Borough of Manhattan, City of New York,
County of New York, State of New York, bounded and described as follows:

 

Beginning at the corner formed by the
intersection of the southerly side of Cortlandt Street and the westerly side of
Broadway;

thence Westerly along the southerly line of
Cortlandt Street as now established, 315 feet 5-1/4 inches to its intersection
with the easterly side of Church Street;

thence Southerly along the said easterly side
of Church Street, 226 feet 5-1/4 inches to the northerly side of Liberty Street
as now established;

thence Easterly along said northerly side of
Liberty Street as now established, 290 feet 5-5/8 inches to its intersection
with the westerly side of Broadway;

thence Northerly along the said westerly side
of Broadway, 226 feet 1-3/8 inches to the corner first mentioned, at the point
or place of Beginning.

 

Beginning at the corner formed by the
intersection of the westerly side of Broadway as now established and the
southerly side of Liberty Street; running

thence Westerly along the said southerly side
of Liberty Street, 286 feet 7-7/8 inches to its intersection with the easterly
side of Trinity Place;

thence Southerly along the said easterly side
of Trinity Place, 95 feet 5-1/4 inches to its intersection with the northerly
side of Cedar Street;

thence Easterly along the said northerly side
of Cedar Street, 278 feet 7-5/8 inches to its intersection with the westerly
side of Broadway as now established;

thence Northerly along the said westerly side
of Broadway as now established, 94 feet 6-5/8 inches to the corner first
mentioned, at the point or place of Beginning.

 

A-1

 

EXHIBIT B

 

Floor Plan of Premises

 

B-1

 

EXHIBIT C

[Intentionally Omitted]

 

X-1

 

EXHIBIT D

 

Rules and Regulations

 

1.                           The rights of each tenant in the
entrances, corridors, elevators and escalators servicing the Building are
limited to ingress to and egress from such tenant’s premises for the tenant and
its employees, licensees and invitees, and no tenant shall use, or permit the
use of, the entrances, corridors, escalators or elevators for any other
purpose.  No tenant shall invite to the
tenant’s premises, or permit the visit of, persons in such numbers or under
such conditions as to interfere with the use and enjoyment of any of the
plazas, entrances, corridors, escalators, elevators and other facilities of the
Building by any other tenants.  Fire
exits and stairways are for emergency use only, and they shall not be used for
any other purpose by the tenants, their employees, licensees or invitees.  No tenant shall encumber or obstruct, or permit
the encumbrance or obstruction of any of the sidewalks, plazas, entrances,
corridors, escalators, elevators, fire exits or stairways of the Building.  Landlord reserves the right to control and
operate the public portions of the Building and the public facilities, as well
as facilities furnished for the common use of the tenants, in such manner as it
in its reasonable judgment deems best for the benefit of the tenants generally.

 

2.                           Landlord may refuse admission to the
Building outside of Business Hours on Business Days (as such terms are defined
in the lease to which this Exhibit is attached) to any person not known to the
watchman in charge or not having a pass issued by Landlord or the tenant whose
premises are to be entered or not otherwise properly identified, and Landlord
may require all persons admitted to or leaving the Building outside of Business
Hours on Business Days to provide appropriate identification.  Tenant shall be responsible for all persons
for whom it issues any such pass and shall be liable to Landlord for all acts
or omissions of such persons.  Any
person whose presence in the Building at any time shall, in the reasonable
judgment of Landlord, be prejudicial to the safety, character or reputation of
the Building or of its tenants may be denied access to the Building or may be
ejected therefrom.  During any invasion,
riot, public excitement or other commotion, Landlord may prevent all access to
the Building by closing the doors or otherwise for the safety of the tenants
and protection of property in the Building.

 

D-1

 

3.                           Intentionally omitted.

 

4.                           Subject to the provisions of the
Lease, the cost of repairing any damage to the public portions of the Building
or the public facilities or to any facilities used in common with other
tenants, caused by a tenant or its employees, agents, contractors, licensees or
invitees, shall be paid by such tenant.

 

5.                           No awnings or other projections shall
be attached to the outside walls of the Building.  No curtains, blinds, shades or screens which are different from
the standards adopted by Landlord for the Building shall be attached to or hung
in, or used in connection with, any exterior window or door of the premises of
any tenant, without the prior written consent of Landlord.  Such curtains, blinds, shades or screens
must be of a quality, type, design and color, and attached in the manner
reasonably approved by Landlord.

 

6.                           No lettering, sign, advertisement,
notice or object shall be displayed in or on the exterior windows or doors, or
on the outside of any tenant’s premises, or at any point inside any tenant’s
premises where the same might be visible outside of such premises, without the
prior written consent of Landlord.  In
the event of the violation of the foregoing by any tenant, Landlord may remove
the same without any liability, and may charge the expense incurred in such
removal to the tenant violating this rule. 
Interior signs, elevator cab designations and lettering on doors and the
Building directory shall, if and when approved by Landlord, be inscribed,
painted or affixed for each tenant by Landlord at the expense of such tenant,
and shall be of a size, color and style acceptable to Landlord.

 

7.                           The sashes, sash doors, skylights,
windows and doors that reflect or admit light and air into the halls,
passageways or other public places in the Building shall not be covered or
obstructed by any tenant, nor shall any bottles, parcels or other articles be
placed on the window sills or on the peripheral air conditioning enclosures, if
any.

 

8.                           No showcases or other articles shall
be put in front of or affixed to any part of the exterior of the Building, nor
placed in the halls, corridors or vestibules.

 

9.                           No bicycles, vehicles, animals (other
than dogs which assist blind or hearing impaired individuals), fish or birds

 

D-2

 

of any kind shall be
brought into or kept in or about the premises of any tenant or the Building.

 

10.                     No noise, including, but not limited
to, music or the playing of musical instruments, recordings, radio or
television, which, in the judgment of Landlord, might disturb other tenants in
the Building, shall be made or permitted by any tenant.  Nothing shall be done or permitted in the
premises of any tenant which would impair or interfere with the use or quiet
enjoyment by any other tenant of any other space in the Building.

 

11.                     No tenant, nor any tenant’s
contractors, employees, agents, visitors or licensees, shall at any time bring
into or keep upon the premises or the Building any inflammable, combustible,
explosive or otherwise dangerous fluid, chemical or substance.

 

12.                     Except as may be otherwise provided in
the Lease, additional locks or bolts of any kind which shall not be operable by
the Grand Master Key for the Building shall not be placed upon any of the doors
or windows by any tenant, nor shall any changes be made in locks or the
mechanism thereof which shall make such locks inoperable by said Grand Master
Key.  Landlord shall be liable for its
negligent use of the Grand Master key by any of Landlord’s employees, agents or
contractors.  Additional keys for a
tenant’s premises and toilet rooms shall be procured only from Landlord at
Landlord’s cost therefor.  Each tenant shall,
upon the termination of its tenancy, turn over to Landlord all keys of stores,
offices and toilet rooms, either furnished to, or otherwise procured by, such
tenant, and in the event of the loss of any keys furnished by Landlord, such
tenant shall pay to Landlord the cost thereof.

 

13.                     All removals, or the carrying in or
out of any safes, freight, furniture, packages, boxes, crates or any other
object or matter of any description must take place during such hours and in
such elevators, and in such manner as Landlord or its agent may determine from
time to time.  The persons employed to
move safes and other heavy objects shall be reasonably acceptable to Landlord
and, if so required by law, shall hold a Master Rigger’s license.  Arrangements will be made by Landlord with
any tenant for moving large quantities of furniture and equipment into or out
of the Building.  All out of pocket
labor and engineering costs incurred by Landlord in connection with any moving
specified

 

D-3

 

in this rule, including a
reasonable charge for overhead and profit, shall be paid by tenant to Landlord,
on demand.

 

14.                     Landlord reserves the right to inspect
all objects and matter to be brought into the Building and to exclude from the
Building all objects and matter which violate any of these Rules and
Regulations or the lease of which this Exhibit is a part.  Landlord may require any person leaving the
Building with any package or other object or matter to submit a pass, listing such
package or object or matter, from the tenant from whose premises the package or
object or matter is being removed, but the establishment and enlargement of
such requirement shall not impose any responsibility on Landlord for the
protection of any tenant against the removal of property from the premises of
such tenant.  Landlord shall in no way
be liable to any tenant for damages or loss arising from the admission,
exclusion or ejection of any person to or from the premises or the Building
under the provisions of this Rule or of Rule 2 hereof.

 

15.                     No tenant shall occupy or permit any
portion of its premises to be occupied as an office for a public stenographer
or public typist, or for the possession, storage, manufacture, or sale of
liquor, narcotics, dope, tobacco in any form, or as a barber, beauty or
manicure shop, or as a public school. 
No tenant shall use or permit its premises or any part thereof to be
used, for manufacturing, or the sale at retail or auction of merchandise,
goods, or as a public school.  No tenant
shall use or permit its premises or any part thereof to be used, for
manufacturing, or the sale at retail or auction of merchandise, goods or
property of any kind.

 

16.                     Landlord shall have the right to
prohibit any advertising or identifying sign by any tenant which, in Landlord’s
reasonable judgment, will impair the reputation of the Building or its
desirability as a building for others, and upon written notice from Landlord,
such tenant shall refrain from and discontinue such advertising or identifying
sign.

 

17.                     Landlord shall have the right to
prescribe the weight and position of safes and other objects of excessive
weight, and no safe or other object whose weight exceeds the lawful load for
the area upon which it would stand shall be brought into or kept upon any
tenant’s premises.  If, in the judgment
of Landlord, it is necessary to distribute the concentrated weight of any heavy
object, the work involved in such

 

D-4

 

distribution shall be done
at the expense of the tenant and in such manner as Landlord shall determine.

 

18.                     No machinery or mechanical equipment
other than ordinary portable business machines may be installed or operated in
any tenant’s premises without Landlord’s prior written consent which consent
shall not be unreasonably withheld or delayed, and in no case (even where the
same are of a type so excepted or as so consented to by Landlord) shall any
machines or mechanical equipment be so placed or operated as to disturb other
tenants; but machines and mechanical equipment which may be permitted to be
installed and used in a tenant’s premises shall be equipped, installed and
maintained by such tenant as to prevent any disturbing noise, vibration or
electrical or other interference from being transmitted from such premises to
any other area of the Building.

 

19.                     Landlord, its contractors, and their
respective employees, shall have the right to use, without charge therefor, all
light, power and water in the premises of any tenant while cleaning or making
repairs or alterations in the premises of such tenant.

 

20.                     No premises of any tenant shall be
used for lodging or sleeping or for any immoral or illegal purpose.

 

21.                     The requirements of tenants will be
attended to only upon application at the office of the Building.  Employees of Landlord shall not perform any
work or do anything outside of their regular duties, unless under special
instructions from Landlord.

 

22.                     Canvassing, soliciting and peddling in
the Building are prohibited and each tenant shall cooperate to the extent
reasonably practicable to prevent the same.

 

23.                     No tenant shall cause or permit any
unusual or objectionable odors to emanate from its premises which would annoy
other tenants or create a public or private nuisance.  No cooking shall be done in the premises of any tenant except as
is expressly permitted in such tenant’s lease.

 

24.                     Nothing shall be done or permitted in
any tenant’s premises, and nothing shall be brought into or kept in any
tenant’s premises, which would impair or interfere with any of the Building’s
services or the proper and economic heating, ventilating, air conditioning,
cleaning or other servicing of

 

D-5

 

the Building or the
premises, or the use or quiet enjoyment by any other tenant of any other
premises, nor shall there be installed by any tenant any ventilating,
air-conditioning, electrical or other equipment of any kind which, in the
reasonable judgment of Landlord, might cause any such impairment or
interference.

 

25.                     No acids, vapors or other materials
shall be discharged or permitted to be discharged into the waste lines, vents
or flues of the Building which may damage them.  The water and wash closets and other plumbing fixtures in or
serving any tenant’s premises shall not be used for any purpose other than the
purposes for which they were designed or constructed, and no sweepings,
rubbish, rags, acids or other foreign substances shall be deposited therein.  Subject to the provisions of the Lease, all
damages resulting from any misuse of the fixtures shall be borne by the tenant
who, or whose servants, employees, agents, visitors or licensees, shall have
caused the same.  Any cuspidors or containers
or receptacles used as such in the premises of any tenant or for garbage or
similar refuse, shall be emptied, cared for and cleaned by and at the expense
of such tenant.

 

26.                     All entrance doors in each tenant’s
premises shall be left locked and all windows shall be left closed by the tenant
when the tenant’s premises are not in use. 
Entrance doors shall not be left open at any time.  Each tenant, before closing and leaving its
premises at any time, shall turn out all lights.

 

27.                     Hand trucks not equipped with rubber
tires and side guards shall not be used within the Building.

 

28.                     All windows in each tenant’s premises
shall be kept closed, and all blinds therein above the ground floor shall be
lowered as reasonably required because of the position of the sun, during the
operation of the Building air-conditioning system to cool or ventilate the
tenant’s premises.  If Landlord shall
elect to install any energy saving film on the windows of the Premises or to
install energy saving windows in place of the present windows tenant shall
cooperate with the reasonable requirements of Landlord in connection with such
installation and thereafter the maintenance and replacement of the film and/or
windows and permit Landlord to have access to the tenant’s premises at
reasonable times during Business Hours to perform such work.

 

D-6

 

29.                     No “Hazardous Materials” (as defined
below) shall be used, transported, stored, released, handled, produced or
installed in, on or from, Tenant’s premises or the Building.  The term “Hazardous Materials” shall, for
the purposes hereof, mean any flammable explosives, radioactive materials,
hazardous wastes, hazardous and toxic substances, or related materials,
asbestos or any material containing asbestos, or any other substance or
material, as defined by any federal, state or local environmental law,
ordinance, rule or regulation including, without limitation, the Comprehensive
Environmental Response Compensation and Liability Act of 1980, as amended, the
Hazardous Materials Transportation Act, as amended, the Resource Conservation
and Recovery Act, as amended, and in the regulations adopted and publications
promulgated pursuant to each of the foregoing.

 

30.                     Landlord reserves the right to
rescind, alter or waive any rule or regulation at any time prescribed for the
Building when, in its reasonable judgment, it deems it necessary, desirable or
proper for its best interest and for the best interests of the tenants
generally, and no alteration or waiver of any rule or regulation in favor of
one tenant shall operate as an alteration or waiver in favor of any other
tenant.  Landlord shall not be
responsible to any tenant for the non-observance or violation by any other
tenant of any of the rules and regulations at any time prescribed for the
Building.

 

D-7

 

EXHIBIT E

 

Alterations Rules and
Regulations

 

A.           General

 

1)              Tenant will make no alterations,
decorations, installations, repairs, additions, improvements or replacements
(which are herein called “Alterations” and which are the Alterations
referred to in the lease) in, to or about the Premises except in compliance
with Article 11 of the Lease.

 

2)              Prior to the commencement of any
Alterations, Tenant is responsible for obtaining, from the Building Manager, a
base Building pre-demolition/pre-construction status report noting condition of
Premises.

 

3)              Prior to the commencement of any
Alterations, Tenant shall submit for Landlord’s written approval all required
items described in Paragraphs 1, 2 and 3 of Section B hereof.

 

4)              Tenant shall insure that the proposed
Alterations comply with The Administrative Code of The City of New York and all
other laws, ordinances, rules and regulations promulgated by all governmental
agencies and bodies having jurisdiction over such Alterations, including,
without limitation, the Americans With Disabilities Act.

 

5)              Tenant shall insure that all proposed
Alterations comply with Building standards listed in Section C hereof, and
are adequately designed to serve Tenant’s needs while remaining in full
conformity with, and not adversely affecting, any Building systems.

 

6)              All (i) demolition or removal of
construction materials, or (ii) moving of construction materials to or
from the Building, or (iii)  other categories of work which may disturb or
interfere with other Tenants of the Building or disturb or interfere with
Building operations, must be scheduled and performed before or after Business
Hours.  Tenant shall provide the
Building Manager with written notice at least twenty-four (24) hours prior to
scheduling any Alteration, and shall pay Landlord’s standard charges for
overtime porters, security,

 

E-1

 

engineers and other costs
incurred by Landlord in connection with such after hours scheduling.

 

7)              Pursuant to Section 11.02(b) of
the Lease, Landlord reserves the right, in addition to being reimbursed for the
cost of outside consultants referred to in Paragraph C(1) below, to impose
a construction supervision fee of two percent (2%) of Tenant’s construction
costs to reimburse Landlord for its internal costs in providing assistance in
design coordination, drawing review, Building Department document processing
and tracking, field inspection, and assistance in interfacing construction with
Tenant’s Alterations.

 

8)              All inquiries, Tenant plans, requests
for approvals, and all other matters shall be processed through the Building
Manager.

 

B.             Tenant Submittals

 

1)              Tenant to submit, to Landlord, the
following information for Landlord’s review and approval prior to commencement
of any Alterations.  Landlord’s review
and approval period will not commence until the Building Manager is in receipt
of the following items, as one complete package:

 

a)                          Letter of Intent to perform
construction.  Letter to include a brief
description of the proposed Alterations, Tenant contact, complete list of
proposed contractors and work schedule.

 

b)                         Two (2) sets of design drawings and
specifications noting full scope of work involved in performing such
Alterations.  All drawings must be
signed and sealed by Tenant’s Registered Architect or Professional Engineer
licensed to conduct business in the State of New York.  Part plan drawings will not be acceptable.

 

(i)                         If full height partition walls are
being installed in an area that is sprinklered, the existing sprinkler head
locations must be included to show that new partitions are not in conflict with
sprinkler coverage.

 

(ii)                      If the area being altered includes
existing compartmentation walls, those compartmentation walls must be indicated
on Tenant’s layout.

 

E-2

 

c)                          A letter from Tenant’s Registered
Architect or Professional Engineer stating that their design and scope of work
complies with all applicable codes, and local laws, especially noting Local
Laws 16/84, 58/87, and 5/73.  This
letter must be signed and include their professional seal.

 

d)                         Proper New York City Building
Department filing applications, as required, for all Alterations indicated on
drawings.

 

e)                          Valid Certificates of Insurance and a
Contractors Agreement signed by Tenant’s general contractor (see Insurance
Requirements in Section D hereof).

 

2)              Upon completion of Landlord’s review,
the following will be returned to Tenant:

 

a)                          A letter (i) granting approval to
file drawings; or (ii) granting conditional approval, subject to Tenant
incorporating Landlord’s comments and suggested revisions into a revised set of
design drawings (no Alterations will commence or applications be filed until
Landlord is in receipt of such revised set of drawings); or
(iii) disapproving such Alterations; and

 

b)                         If approved, or conditionally
approved, Building Department applications signed by Landlord.

 

Landlord’s review is for
conformance with Building standards only and is not a review for compliance
with law or a review of the adequacy of Tenant’s design.  No such approval, or comments shall
constitute a waiver of the obligation that Tenant’s Alterations comply with all
laws and receive Buildings Department or other governmental approvals.

 

3)              Prior to commencement of Alterations:

 

Tenant to submit to
Landlord the following:

 

a)                          A letter or revised drawings
addressing Landlord’s comments, if any.

 

E-3

 

b)                         Approved New York City Building
Department filing applications, drawings, and all work permits.

 

c)                          A final list of all contractors and
subcontractors who will perform the Alterations.

 

d)                         A work schedule noting duration of
work.

 

4)              Upon completion of Alterations:

 

Tenant to submit to
Landlord, in a timely manner, the following:

 

a)                          All sign-off documents which pertain to work filed from all agencies
having jurisdiction.

 

b)                         As-built drawings.

 

c)                          A properly executed Air Balancing
Report, signed by a Professional Engineer.

 

C.             Building Standard Requirements

 

1)              All structural or floor loading
requirements, mechanical (HVAC), plumbing, sprinkler, electrical, fire alarm,
elevator, of any proposed Tenant installation shall be subject to the prior
approval of Landlord’s consultants.  All
expenses incurred by Landlord’s consultant regarding review and approval of
Tenant’s design shall be at Tenant’s expense.

 

2)              All demolition shall be supervised by
Landlord’s representative at Tenant’s expense.

 

3)              Elevator service for construction work
shall be charged to Tenant at standard Building rates.  Prior arrangements for elevator use shall be
made with Building Manager by Tenant. 
No material or equipment shall be carried under or on top of
elevators.  If workmen (including,
without limitation, Operating Engineers and Personnel Carriers), are required
by any union regulations for material or personnel hoisting, such workmen shall
be paid for by Tenant.

 

4)              If shutdown of any mechanical or
electrical risers are required, such shutdown shall be performed by Landlord’s
contractors at Tenant’s expense or, at Landlord’s option,

 

E-4

 

supervised by Landlord’s
representative at Tenant’s expense.

 

5)              Tenant’s contractor shall:

 

a)                          have a Superintendent or Foreman on
the Premises at all times;

 

b)                         police the job at all times,
continually keeping the Premises orderly; protection and maintenance will be
Tenant’s responsibility;

 

c)                          maintain cleanliness and protection of
all areas, including elevators and lobbies;

 

d)                         protect the front and top of all
peripheral HVAC units and thoroughly clean them at the completion of work;

 

e)                          block off supply and return grills,
diffusers and ducts to keep dust from entering into the Building air
conditioning system;

 

f)                            protect all Class “E” fire alarm
devices and wiring; and

 

g)                         avoid the disturbance of other
Tenants.

 

6)              If any part of Tenant’s Alteration is
improperly performed, Tenant shall be charged for corrective work done by
Landlord’s personnel or contractors engaged for such purpose by Landlord.

 

7)              All equipment and installations must
be equal to the standards of the Building. 
Any deviation from Building standards will be permitted only if approved
by Landlord in writing.

 

8)              Tenant shall pay Landlord for any
amounts billed in connection with any Alteration within thirty (30) days after
billing therefor.

 

9)              Landlord’s contract fire alarm service
personnel shall be the only personnel permitted to adjust, test, alter,
relocate, add to, or remove equipment connected to the Class “E” System.

 

E-5

 

10)                    During such times that Tenant’s
alterations or demolition of the Premises require that fire protection afforded
by the Class “E” System or sprinkler system be disabled, Tenant, at Tenant’s
expense, shall maintain fire watch service deemed reasonably suitable to
Landlord, and any agency having jurisdiction.

 

11)                    Landlord, at Tenant’s expense, shall
repair or cause to have repaired, any and all defects, deficiencies or
malfunctions of the Class “E” System caused by Tenant’s Alterations or related
demolition.  Such expense may include
expenses of engineering, supervision and standby fire watch personnel that Landlord
deems necessary to protect the Building during the time such defects,
deficiencies and malfunctions are being corrected.

 

12)                    Should Tenant desire to install its
own internal fire alarm system, Tenant shall request Landlord to connect such
system to the Class “E” System at Tenant’s expense in such reasonable manner as
prescribed by Landlord.  Tenant shall,
at Tenant’s expense, have such internal fire alarm system approved by governing
agencies having jurisdiction, and shall submit to Landlord an approved copy of
plans of such system before initiating any installation of such system.  Tenant must demonstrate that system is in
working order prior to requesting tie-in.

 

13)                    Landlord, at Tenant’s expense, will be
responsible for the maintenance and proper operation of any Tenant Class “E”
Fire Alarm sub-system.

 

14)                    When Tenant’s use of any space
requires a change in the Certificate of Occupancy, whether a building has a
Final Certificate of Occupancy or Temporary Certificate of Occupancy, or (as in
the case of a new Building with a Temporary Certificate of Occupancy) involves
the initial inclusion of the Premises on the Certificate of Occupancy, the
Tenant must utilize the services of Landlord’s consultant.  The Tenant shall be responsible for
coordination with the consultant, and for all costs in connection with such
consultant’s services.

 

15)                    The Tenant will be responsible for
keeping, on Premises, a copy of all required Building Department approved
applications, drawings, permits, and sign-offs

 

E-6

 

during and after
completion of construction and shall deliver same to Landlord at the expiration
of the Lease.

 

16)                    The following penalties will be
assessed to all tenants that do not comply with submission of Building
Department documents and sign-off procedures as outlined in Section B
hereof:

 

a)              Future Building Department documents
that require Landlord’s signature will not be signed nor will work be allowed
to commence until complete submission of all required past Building Department
documents have been received.

 

b)             Leasehold improvement allowance will
not be released to Tenant until all Building Department documents and sign-offs
have been received.

 

17)                    The attachment of any work to Building
window mullions, HVAC enclosures, window soffets, will not be permitted.

 

18)                    Drywall partitions or installations
abutting window mullions must allow for the operation of pivoting windows where
applicable.

 

19)                    Electrical wire mold will not be
permitted without written approval from Landlord.

 

20)                    Chasing of structural slab or Building
masonry walls will not be permitted unless special consent is given by
Landlord.

 

21)                    The attachment of drywall metal studs
or track to mechanical, electrical, plumbing, sprinkler, or any Building
systems will not be permitted.

 

22)                    All valves or equipment controlling
Building systems or Tenant systems must be tagged and identified.

 

23)                    Access doors must be provided to all
Building equipment and Tenant equipment.

 

24)                    Tenant’s design consultant is
responsible to insure that base Building systems are adequately sized to meet
Tenant’s requirements.  Tenant shall be
responsible for alterations to any existing HVAC ductwork or system and

 

E-7

 

shall ensure that such
work is integrated so as not to adversely affect the Building system.

 

25)                    All locking devices must be keyed and
mastered to Building keying system.  Two
(2) individual keys must be supplied to the Building Manager.

 

26)                    All hardware is to match Building
standards.

 

27)                    Tenant shall not install any outside
louvers without Landlord’s prior written approval.  Detailed sketches of all proposed louvers shall be submitted for
Landlord’s approval which approval may be granted or withheld in Landlord’s
sole discretion.

 

28)                    All unused wiring, conduit, equipment,
materials, or previously installed work, no longer needed, must be removed.

 

29)                    Any connections to Building systems
must be of the same materials as existing Building standards.

 

30)                    No exposed piping of any kind will be
permitted.

 

31)                    Any signage, window dressing, or
Tenant decor visible from outside the Tenant’s Premises must receive written
approval from Landlord prior to installation.

 

32)                    The modification of any elevator
equipment must receive prior written approval from Landlord.  All elevator devices must remain accessible
for maintenance and must conform to Building standards.

 

33)                    Tenant is not to mount any equipment
in Building Electrical Closets, Telephone Closets, or Mechanical Equipment
Rooms without prior written approval from Landlord.

 

34)                    Tenant is responsible to insure that
all work is performed in a normal, acceptable, and safe manner.

 

E-8

 

D.            Contractors Agreement; Insurance
Requirements

 

[To be retyped on
Letterhead of Tenant’s General Contractor, addressed to Landlord]

 

Tenant:

 

Premises:

 

The undersigned contractor
or subcontractor (herein called “Contractor”) has been hired by the
Tenant or occupant (herein called “Tenant”) of the Building named above
or by Tenant’s contractor to perform certain work (herein called “Work”)
for Tenant in the Tenant’s Premises in the Building.  Contractor and Tenant have requested the undersigned Landlord
(herein called “Landlord”) to grant Contractor access to the Building
and its facilities in connection with the performance of the Work and Landlord
agrees to grant such access to Contractor upon and subject to the following
terms and conditions:

 

1)                          Contractor agrees to indemnify and
save harmless the Landlord, and its respective officers, employees and agents
and their affiliates, subsidiaries, and partners, and each of them, from and
with respect to any claims, demands, suits, liabilities, losses and expenses,
including reasonable attorneys’ fees, arising out of or in connection with the
Work (and/or imposed by law upon any or all of them) because of personal
injuries, including death at any time resulting therefrom, and loss of or
damage to property, including consequential damages, whether such injuries to
persons or property are claimed to be due to negligence of the Contractor,
Tenant, Landlord or any other party entitled to be indemnified as aforesaid
except to the extent specifically prohibited by law (and any such prohibition
shall not void this Agreement but shall be applied only to the minimum extent
required by law).

 

2)                          Contractor shall provide and maintain
at its own expense, until completion of Work, the following insurance:

 

a)              Workers’ Compensation and Employers’
Liability Insurance covering each and every workman employed in, about or upon
the Work, as provided for in each

 

E-9

 

and every statute
applicable to Workers’ Compensation and Employers’ Liability Insurance.

 

b)             Comprehensive General Liability Insurance
Including Coverage for Completed Operations, Broad Form Property Damage “XCU”
exclusion if any deleted, and Contractual Liability (to specifically include
coverage for the indemnification clause of this Agreement) for not less than
the following limits:

 

Combined Single Limit

Bodily Injury and

Property Damage Liability:                                                    $5,000,000

(written on a per
occurrence

(basis)

 

c)              Comprehensive Automobile Liability
Insurance (covering all owned, non-owned and/or hired motor vehicles to be used
in connection with the Work) for not less than the following limits:

 

Bodily Injury:                                                                                   $5,000,000 per person

$5,000,000 per occurrence

Property Damage:             $5,000,000 per occurrence

 

Contractor shall furnish a
certificate from its insurance carrier or carriers to the Building office
before commencing the Work, showing that it has complied with the above
requirements regarding insurance and providing that the insurer will give
Landlord ten (10) days prior written notice of the cancellation of any of the
foregoing policies.

 

3)                          Contractor shall require all of its
subcontractors engaged in the Work to provide the following insurance:

 

a)              Comprehensive General Liability
Insurance Including Protective and Contractual Liability Coverages with limits
of liability at least equal to the above stated limits.

 

b)             Comprehensive Automobile Liability
Insurance (covering all owner, non-owned and/or hired motor vehicles to be used
in connection with the Work) for not less than the following limits:

 

E-10

 

Bodily Injury:                                                $5,000,000 per person

$5,000,000 per occurrence

Property Damage:                         $5,000,000 per occurrence

 

E-11

 

Upon the request of
Landlord, Contractor shall require all of its subcontractors engaged in the
Work to execute an Insurance Requirements agreement in the same form as this
Agreement.

 

Agreed to and executed
this           day
of                  ,
2002.

 

Landlord:                                                 Contractor:

 

	
   

  	
   

  	
   

  

 

E-12

 

EXHIBIT F

 

Cleaning Specifications

 

Schedule 
of Service

 

Cleaning will be done daily, Monday through
Friday, except for Union Holidays (in the applicable union contract for
cleaning staff).  Blitz Cleaning is a
limited exception, however:

 

Although there is  no cleaning on New Year’s Day, President’s Day, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day,  reduced services  (“Blitz Cleaning”)are 
provided on the other holidays (e.g., Good Friday, Columbus Day, and the
Day After Thanksgiving).  In Blitz
Cleaning,  a skeleton crew, including a
day porter,  empties wastebaskets
and  ash trays, removes rubbish in
tenanted areas, and provides some basic services in the common areas.

 

Cleaning Times: 5 PM through 6 AM.

 

Supervision

 

A cleaning supervisor will verify that work
has been completed in tenant premisses, lights turned off, doors locked, and
offices left in a neat condition for the next day’s business.  The cleaning staff will be instructed to
keep Tenant’s Premisses locked during cleaning and to admit only other cleaning
staff authorized to be within them.

 

Floor Care

 

Carpeted floors and rugs will be vacuumed
nightly.  Hard floors (including ceramic
tile, stone, terrazzo, wood and the like) and resilient flooring (linoleum, rubber
and asphalt tile) will be swept nightly.

 

Office Cleaning

 

Nightly, cleaners will:

 

•                Dust and wipe
clean all desk tops, telephones and office equipment; empty and damp wipe clean
all ashtrays.

 

•                Dust and wipe
clean all uncluttered office furniture, including desks, file cabinets,
credenzas, and bookcases, as well as wall fixtures, window sills and convector 

 

F-1

 

enclosure tops.  They will  wash the sills and convector tops when
accessible and necessary.

 

•                Empty all waste
receptacles and replace plastic waste receptacle liners when necessary.

 

•                Clean all water
fountains and coolers, removing all fingerprints and smudges.

 

•                Sweep or vacuum
clean, as appropriate, all private stairwells.

 

As often as necessary to maintain a clean
appearance, the cleaning contractor will:

 

•                Dust all chair
rails, trims and baseboards within reach.

 

•                Clean all metal
and remove finger marks.

 

High Dusting

 

Certain procedures (“High Dusting”) will be
performed quarterly:

 

•                Dust all pictures
frames, charts, and similar wall hangings not reached in nightly cleaning.

 

•                Dust all vertical
surfaces, such as walls, partitions, doors and bucks and other surfaces not
reached in nightly cleaning.

 

•                Dust all pipes,
ventilating, heating and air conditioning louvers, grates, grills, ducts, high
moldings and all other high areas not reached in nightly cleaning.

 

•                Dust all exterior
surfaces of lighting fixtures including bulbs, glass, lenses and plastic or
metal enclosures.

 

•                Dust and inspect
all venetian blinds.

 

Core Lavatories

 

Every night a porter will:

 

•                Sweep and wash
lavatory floors using approved disinfectants. 
Machine scrubbing will be done weekly.

 

F-2

 

•                Wash and disinfect
both sides of all toilet seats.

 

•                 Scour, wash and
disinfect all basins, bowls and urinals using an odorless disinfectant.

•                Wash and polish
all mirrors, powder shelves, bright work fixtures and enameled surfaces,
including flushometer piping and toilet seat hinges.

 

•                Dust and clean,
washing where necessary, all partitions, tile walls, dispensers and receptacles
in lavatories.  Every two weeks, a
porter will wash and polish all wall tiles and stall surfaces.

 

•                Fill all toilet
tissue holders with tissue furnished by Landlord. Throughout each business day,
a porter or matron will maintain an adequate supply of tissue, paper towels,
hand soap, the towels and soap  to be
supplied by Landlord’s cleaning contractor at Tenant’s expense.  The porter or matron will also police the
lavatory and maintain it in a neat, orderly condition throughout the day.

 

•                Empty and damp
clean paper towel receptacles and sanitary napkin disposal receptacles.

 

•                Wash waste cans
and receptacles in lavatories when necessary but at least once a week.  Replace plastic waste can liners weekly.

 

Glass Cleaning

 

All exterior and interior windows will be
cleaned, weather permitting, quarterly. 
Mail chute glass and floor directory glass will also be cleaned
quarterly.

 

Additional Cleaning Services

 

Any services not listed above will be solely
at Tenant’s expense. In particular, this includes:

 

•                Washing and /or
waxing non-carpeted flooring; spotting and shampooing carpeting.

 

•                The cleaning,
maintaining and furnishing of lavatory supplies for private (non-core)
lavatories.

 

F-3

 

•                Washing and
relamping of all light fixtures.

 

•                Cleaning any  interior glass other than windows, mail
chutes and directories.

 

•                Exterminating in
Tenant’s Premisses (to be done by Landlord’s contractor).

 

•                Any cleaning and
related rubbish removal for computer rooms, training rooms, copy centers/rooms,
cafeterias, kitchens, pantries or any other areas used for the preparation,
distribution, or consumption of food.

 

F-4

 

EXHIBIT G

 

Heating, Ventilating and Air-Conditioning
Specifications

 

Landlord will provide A/C duct riser with
shaft supply outlets.  The Building HVAC
system (the “System”) shall be designed to maintain the following conditions
provided the tenant’s air distribution is designed for minimum of 1 cfm per
usable square foot and the air distribution duct work conforms to S.M.A.C.N.A.
(Sheet Metal and Air Conditioning National Association, Inc.) standards for variable
air volume systems.  In the summer, the
System shall be nominally designed to maintain a maximum of 76°
plus or minus 2° degrees F dry bulb temperature and 50% relative
humidity when the outdoor weather conditions do not exceed 92 degrees F dry bulb
and 75 degrees F wet bulb.  In the
winter, the System shall be nominally designed to maintain a minimum of 72°
plus or minus 2 degrees F dry bulb when the outdoor temperature is not less
than 5 degrees F: maximum inside relative humidity shall, in any event, when
outside temperature is 5 degrees-65 degrees dry bulb, be limited to that which
will not cause condensation on the windows. 
Outdoor air shall be introduced into the Building in an amount
sufficient to satisfy existing local code requirements (as of the date
hereof).  The design conditions
described herein are based upon an occupancy of not more than one person per
100 usable square feet, a combined lighting and standard electrical load not to
exceed five (5) watts per usable square foot, and the use of venetian blinds on
each window in accordance with Landlord’s reasonable rules and regulations.

 

G-1

 

EXHIBIT H

 

Form of Security Letter

 

	
   

  	
   

  	
  Standby Letter of Credit No. 

  
	
   

  	
   

  
	
   

  	
   

  	
  Date of Issue:  

  
	
   

  	
   

  
	
  Issuing Bank:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Beneficiary:

  	
  Applicant:

  
						

 

 

	
  BFP ONE LIBERTY PLAZA
  CO. LLC

  One Liberty Plaza

  165 Broadway

  New York, New York 10006

  	
  ARCH INSURANCE COMPANY

  One Liberty Plaza

  165 Broadway

  New York, New York 10006

  

 

 

Amount:  $943,600.00

 

Dear Sir(s):

 

We hereby issue in your favor our irrevocable
Letter of Credit under the above referenced number and amount which is
available against presentation of your draft drawn on us at sight and bearing
our Letter of Credit number                        .

 

The original Letter of Credit plus any
subsequent amendments thereto must accompany such draft when presented for
payment.  We hereby agree with the
Beneficiary that such drafts will be duly honored upon presentation to us with the
original Letter of Credit plus any subsequent amendments thereto without any
further investigation.

 

It is a condition of this Letter of Credit
that it shall be deemed automatically extended without amendment for periods of
one year each from the present or any future expiration date hereof, unless
forty-five (45) days prior to any expiration date we shall notify you in
writing, by certified mail, return receipt requested, that we elect not to
consider this Letter of Credit renewed for any such additional period.  After receipt by you of such notice, you
may, until the expiration date hereof, draw the full amount of the credit
hereunder, against your draft.

 

H-1

 

Partial drawings under this Letter of Credit
are permitted.

 

This Letter of Credit is transferable by the
Beneficiary upon payment of our customary transfer charges which shall be
debited to the account of applicant.

 

We hereby engage with you that all drafts
drawn under and in compliance with the terms of this irrevocable letter of credit
will be duly honored if presented at our counters at [Insert address of a New York City branch] on or before the
expiration date indicated above.

 

**This documentary credit is subject to the
International Standby Practices (“ISP98”) International Chamber of Commerce
(Publication No. 590), and as to matters not governed by the ISP98, shall be
governed by and construed in accordance with the laws of the State of New York.

 

H-2

 

EXHIBIT I

 

Form of Existing Superior
Mortgage SNDA

 

SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT
AGREEMENT

 

THIS AGREEMENT, made the
      day of August, 2002, among State Street Bank and
Trust Company, as trustee for a trust fund established pursuant to a Trust and
Servicing Agreement, dated as of February 23, 2001 among GS Mortgage Securities
Corporation II, as depositor, ORIX Real Estate Capital Markets, LLC, as the
servicer and State Street Bank and Trust Company, as the trustee (hereinafter
referred to as “Mortgagee”), ARCH INSURANCE COMPANY,  a Missouri corporation, having an office at One Liberty Plaza,
165 Broadway, New York, New York 10006 (hereinafter referred to as “Tenant”),
and BFP ONE LIBERTY PLAZA CO. LLC, a Delaware limited liability company
(hereinafter referred to as “Landlord”).

 

W  I  T  N
E  S  S  E  T  H:

 

WHEREAS, Landlord and Tenant have entered
into a certain lease agreement, dated as of
August     , 2002 (as hereafter amended, supplemented
or otherwise modified from time to time, the “Lease”), relating to the building
located on the premises described in Exhibit “A” annexed hereto
(hereinafter referred to as the “Premises”); and

 

WHEREAS, Mortgagee has agreed to make a
certain loan to BFP One Liberty Plaza Co. LLC, secured by, among other things,
a certain mortgage (hereinafter, together with any renewals, modifications,
consolidations, replacements and extensions of or in substitution thereto, or
in addition to, shall be referred to collectively as the “Mortgage”)
encumbering, among other things, Landlord’s interest in the Premises; and

 

WHEREAS, Tenant has agreed that the Lease is
and shall be subject and subordinate to the Mortgage held by Mortgagee,
provided Tenant is assured of continued occupancy of the Premises under the
terms of the Lease;

 

NOW, THEREFORE, for and in consideration of
the mutual covenants herein contained, the sum of Ten Dollars ($10.00) and
other good and valuable considerations, the receipt and sufficiency of which
are hereby acknowledged, and notwithstanding anything in the Lease to the
contrary, it is hereby agreed as follows:

 

I-1

 

1.                                       Mortgagee,
Tenant and Landlord do hereby covenant and agree that the Lease with all
rights, options, liens and charges created thereby, is and shall continue to be
subject and subordinate in all respects to the Mortgage and to any advancements
made thereunder and to any renewals, modifications, consolidations,
replacements and extensions thereof.

 

2.                                       Mortgagee agrees
that if any action or proceeding is commenced by Mortgagee for the foreclosure
of the Mortgage, Tenant, as tenant under the Lease, shall not (unless required
by law) be named as a party therein, and the sale of the Premises in any such
action or proceeding, and the exercise by Mortgagee of any of its other rights
under the Mortgage shall be made subject to all rights of Tenant under the
Lease (subject to the terms of this Agreement), provided that at the time of
the commencement of any such action or proceeding or at the time of any such
sale or exercise of any such other rights (i) the Lease shall be in full
force and effect, (ii) Tenant shall not have been notified in writing by
Landlord of a default under any of the terms, covenants or conditions of the
Lease, if required under the Lease, or of this Agreement with respect to the
Lease on Tenant’s part to be observed or performed or, if so notified, shall
have cured, or shall cure, such default within the applicable period, if any,
after written notice, and (iii) Tenant is not in default under the specific
terms of this Agreement; provided that if such default is also a default
under the Lease, subparagraph (ii) shall prevail over this subparagraph
(iii).  Notwithstanding anything to the
contrary contained herein, so long as Mortgagee is an Affiliate of Landlord (as
such term is defined in the Lease), Tenant shall not be deemed in default under
the Lease for the purposes of this Agreement unless such default shall have
continued beyond all notice and/or cure periods therein provided.

 

3.                                       Tenant agrees
that if Mortgagee shall become the owner of the Premises by reason of the
foreclosure of the Mortgage or the acceptance of a deed or assignment in lieu
of foreclosure or otherwise, the Lease shall become a direct lease between
Mortgagee and Tenant upon all of the terms, covenants and conditions set forth
in the Lease, and in that event Tenant agrees to attorn to Mortgagee and to
continue to perform its obligations under the Lease and Mortgagee agrees to
accept such attornment; provided, however, that if Mortgagee is
not an entity which is controlled by, controls, or is under common control
with, Landlord (as “control” is defined in the Lease) then Mortgagee shall not
be (i) liable for any accrued obligation of Landlord, or for any act or
omission of Landlord, prior to such foreclosure or sale, (ii) required to make
any repairs to the Premises or to the premises demised under the Lease required
as a result of fire, or other casualty or by reason of condemnation involving
an expenditure in excess of the casualty insurance proceeds or condemnation
awards actually received by Mortgagee, to the extent any such repairs would
otherwise be required under the Lease, (iii) required to perform or provide any
services not related to possession or quiet enjoyment of the premises demised
under the

 

I-2

 

Lease, which services are not expressly set forth in the Lease, or (iv)
subject to any offsets, defenses or counterclaims which shall have accrued to
Tenant against Landlord prior to the date upon which Mortgagee shall become the
owner of the Premises.

 

4.                                       Tenant shall
not, without obtaining the prior written consent of Mortgagee, which consent
shall not be unreasonably withheld or delayed:

 

(i)                                     Assign the Lease
other than pursuant to the provisions of the Lease; provided that,
unless such assignment is to a tenant of comparable creditworthiness with
Tenant, Tenant shall in any event remain fully liable under the provisions of
the Lease;

 

(ii)                                  Prepay any of the
rents (other than the first (1st) month’s rent) under the Lease for more than
one (1) month prior to the accrual thereof, except that (A) the payment as
required under the Lease on a monthly basis of amounts with respect to
operating or other expenses based upon an estimate of such expenses which is to
be adjusted by an appropriate payment at the end of each calendar or lease year
or other period, and (B) the payment as required under the Lease on a monthly
or other periodic basis of amounts with respect to real estate taxes in advance
of the date on which such taxes are due and payable to the taxing authority
shall not be deemed to be a prepayment of rents in violation of the provisions
of this clause (ii); provided that such payments with respect to taxes
are collected either in a lump sum payment which is collected not earlier than
sixty (60) days prior to the date on which such taxes are due and payable to
the taxing authority, or in periodic installments equal to the total amount of
the payment required (as reasonably estimated in good faith by Landlord in the
event tax bills with respect to such tax payment have not theretofore been
issued by the taxing authority) divided by the number of installments, and
payable in a manner such that the total amount to be collected is collected not
earlier than sixty (60) days prior to the

 

I-3

 

date on which such taxes are due and payable
to the taxing authority.

 

Any such assignment or other act in violation of this Paragraph 4 shall
not be binding upon Mortgagee.

 

5.                                       Except as
provided in the Lease, no part of Tenant’s right, title or interest in the
Lease shall in any manner be subordinated to any encumbrance on any interest in
the Premises superior to the interest of Tenant without the consent of
Mortgagee.

 

6.                                       So long as the
Mortgage remains outstanding and unsatisfied and provided the Mortgagee is not
an Affiliate of Landlord (as such term is defined in the Lease), Tenant will
mail or deliver to Mortgagee, at the address and in the manner herein below
provided, a copy of all notices given to Landlord by Tenant under and pursuant
to the terms and provisions of the Lease, claiming default by Landlord under
the Lease, or exercising any right of termination with respect to the Lease or
exercising any options contained in the Lease, together with all notices
pertaining to Tenant’s exercise of its rights under Article 7 of the Lease with
respect to the assignment of the Lease or the subletting of all or any portion
of the Premises. At any time before the rights of Landlord shall have been
forfeited or adversely affected because of any default of Landlord, or within
the time permitted Landlord for curing any default under the Lease as therein
provided (but not less than sixty (60) days from the receipt of notice),
Mortgagee may, but shall have no obligation to, pay any taxes and assessments,
make any repairs and improvements, make any deposits or do any other act or
thing required of Landlord by the terms of the Lease; and all payments so made
and all things so done and performed by Mortgagee shall be as effective to
prevent the rights of Landlord from being forfeited or adversely affected
because of any default under the Lease as the same would have been if done and
performed by Landlord.

 

7.                                       Tenant
acknowledges that Landlord has executed and delivered to Mortgagee an
assignment of the Lease as security for said loans, and Tenant hereby expressly
consents to such assignment.

 

8.                                       Landlord and
Tenant hereby certify to Mortgagee that the Lease has been duly executed by
Landlord and Tenant and is in full force and effect; that the Lease is a
complete statement of the agreement between Landlord and Tenant with respect to
the leasing of the Premises, and the Lease has not been modified or amended;
that to the knowledge of Landlord and Tenant, no party to the Lease is in
default thereunder; that no rent under the Lease has been paid more than thirty
(30) days in advance of its due date, except for prepayments permitted under
Paragraph 4 above; and that Tenant, to the best of its

 

I-4

 

knowledge, as of the date hereof, has no charge, lien or claim of
offset under the Lease, or otherwise, against the rents or other charges due or
to become due thereunder.

 

9.                                       Any and all
notices, elections, demands, requests and responses thereto permitted or
required to be given under this Agreement shall be in writing, signed by or on
behalf of the party giving the same, and shall be deemed to have been properly
given and shall be effective upon being sent by (x) national overnight courier,
or (y) upon being deposited in the United States mail, postage prepaid,
registered or certified with return receipt requested, to the other party at
the address of such other party set forth below or at such other address within
the continental United States as such other party may designate by notice
specifically designated as a notice of change of address and given in
accordance herewith.  Any such notice,
election, demand, request or response, if given to Mortgagee, shall be
addressed as follows:

 

State Street Bank and Trust Company (as
trustee

for the benefit of the holders of GS Mortgage

Securities Corporation II Commercial Mortgage

Pass-Through Certificates Series 2001-LIB)

c/o ORIX Real Estate Capital Markets, LLC,
the Servicer

1717 Main Street, Suite 1400

Dallas, Texas  75201

Attention: 
Edgar L. Smith, II

Facsimile: 
(214) 237-2034

 

with a copy to:

 

ORIX Real Estate Capital Markets, LLC

1717 Main Street, 12th Floor

Dallas, Texas  75201

Attention: 
Paul Smyth -GS Mortgage Securities Corporation II

Commercial Mortgage Pass-Through Certificates Series 2001-LIB

Facsimile: 
(214) 237-2040

 

and, if given to Landlord, shall be addressed as follows:

 

BFP One Liberty Plaza Co. LLC

c/o Brookfield Financial Properties, Inc.

One Liberty Plaza

165 Broadway

 

I-5

 

New York, New York  10006

Attention: 
General Counsel

 

with a copy to:

 

BFP One Liberty Plaza Co. LLC

c/o Brookfield Financial Properties, Inc.

One Liberty Plaza

165 Broadway

New York, New York 10006

Attention: 
Managing Attorney

 

and, if given to Tenant, shall be addressed  as follows:

 

Arch Insurance Company

One Liberty Plaza

165 Broadway

New York, New York  10006

Attention: 
President

 

with a copy to:

 

Arch Capital Services, Inc.

20 Horseneck Lane

Greenwich, CT.  06830

Attention: 
General Counsel

 

and shall be deemed to have been given, rendered or made (i) two (2) business days after the
day so mailed, unless mailed outside of the State of New York, in which case it
shall be deemed to have been given, rendered or made on the third business day
after the day so mailed, of (ii)
one business day after the day sent by overnight courier service. Any
party may, by notice as aforesaid, designate a different address or addresses
for notices intended for it. 
Notwithstanding the foregoing, with respect to an occurrence presenting
imminent danger to the health or safety of persons or damage to property in, on
or about the Building or during a postal strike, notices may be hand delivered
to a party at the address to which notices to that party are to be sent; provided
that the same notice is also sent in the manner set forth above. Notices
hereunder from Landlord may be given by Landlord’s managing agent, if one
exists, or by Landlord’s attorney.  In
addition to the foregoing, Landlord or Tenant or Mortgagee may, from time to
time, request in writing that the other parties serve a copy of any notice on
one

 

I-6

 

other person or entity designated in such request, such service to be
effected as provided in this Paragraph 9.

 

10.           This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, legal representatives, successors,
successors-in-title and assigns. When used herein, the term “landlord” refers
to the landlord of the Premises under the Lease and to any successor to the
interest of landlord under the Lease.

 

Notwithstanding anything to the contrary
contained herein, so long as the Mortgagee is an Affiliate of Landlord (as such
term is defined in the Lease) Mortgagee agrees that (i) any eviction of Tenant
shall, unless applicable law requires same, be pursued under the Lease and not
in any foreclosure action, (ii) notwithstanding any contrary provisions of the
Lease, until such time, if ever, as the Lease becomes a direct lease between
Mortgagee and Tenant as provided in Paragraph 2 hereof, no action taken by
Tenant under the Lease shall require the consent of Mortgagee, and (iii) any
consent given by Landlord under the Lease shall be binding upon Mortgagee for
all purposes.

 

 IN
WITNESS WHEREOF, the parties hereto have executed this Agreement under seal as
of the date first above written.

 

	
   

  	
  MORTGAGEE:

  
	
   

  	
   

  
	
   

  	
  STATE STREET
  BANK AND TRUST COMPANY,

  Trustee for the benefit of the holders of GS Mortgage 

  Securities Corporation II Commercial Mortgage 

  Pass-Through Certificates Series 2001-LIB

  
	
   

  	
   

  
	
   

  	
  By:

  	
  ORIX Real Estate Capital Markets, LLC, its
  Servicer

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  TENANT:

  
	
   

  	
   

  
	
   

  	
  ARCH INSURANCE COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
								

 

I-7

 

	
   

  	
  LANDLORD:

  
	
   

  	
   

  
	
   

  	
  BFP ONE
  LIBERTY PLAZA CO. LLC

  
	
   

  	
  By:

  	
  WFP One
  Liberty Plaza Co L.P., its sole member

  
	
   

  	
   

  	
  By: 

  	
  WFP One Liberty
  Plaza Co G.P. Corp., its general partner

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
						

 

 

MORTGAGEE

 

	
  STATE OF NEW YORK

  	
  )

  
	
   

  	
  )ss.:

  
	
  COUNTY OF NEW YORK

  	
  )

  

 

 

On the
         day of
                       
in the year 2002, before me, the undersigned, a Notary Public in and for said
state, personally appeared
                                              ,
personally known to me or proved to me on the basis of satisfactory evidence to
be the person(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
person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  	
   

  

 

I-8

 

LANDLORD

 

	
  STATE OF NEW YORK

  	
  )

  
	
   

  	
  )ss.:

  
	
  COUNTY OF NEW YORK

  	
  )

  

 

 

On the
         day of
                       
in the year 2002, before me, the undersigned, a Notary Public in and for said
state, personally appeared
                                              ,
personally known to me or proved to me on the basis of satisfactory evidence to
be the person(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
person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  	
   

  

 

I-9

 

CORPORATE TENANT

 

	
  STATE OF NEW YORK

  	
  )

  
	
   

  	
  )ss.: 

  
	
  COUNTY OF NEW YORK

  	
  )

  

 

 

On the
         day of
                       
in the year 2002, before me, the undersigned, a Notary Public in and for said
state, personally appeared                                               ,
personally known to me or proved to me on the basis of satisfactory evidence to
be the person(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
person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  	
   

  

 

I-10

 

EXHIBIT A

 

Description of Land

 

PARCEL A (Part of Block 62 Lot 1)

 

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

 

Beginning at the corner formed by the
intersection of the southerly side of Cortlandt Street and the westerly side of
Broadway;

thence Westerly along the southerly line of
Cortlandt Street as now established, 315 feet 5-1/4 inches to its intersection
with the easterly side of Church Street;

thence Southerly along the said easterly side
of Church Street, 226 feet 5-1/4 inches to the northerly side of Liberty Street
as now established;

thence Easterly along said northerly side of
Liberty Street as now established, 290 feet 5-5/8 inches to its intersection
with the westerly side of Broadway;

thence Northerly along the said westerly side
of Broadway, 226 feet 1-3/8 inches to the corner first mentioned, at the point
or place of Beginning, as more particularly shown on that certain survey
prepared by Earl B. Lovell - S.P. Belcher, Inc., dated June 1, 1973,
redated July 28, 1987, which survey is incorporated herein by reference.

 

PARCEL B (Part of Block 62 Lot 1, f/ k/a
Block 50 Lot 2)

 

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

 

Beginning at the corner formed by the
intersection of the westerly side of Broadway as now established and the
southerly side of Liberty Street; running

thence Westerly along the said southerly side
of Liberty Street, 286 feet 7-7/8 inches to its intersection with the easterly
side of Trinity Place;

thence Southerly along the said easterly side
of Trinity Place, 95 feet 5-1/4 inches to its intersection with the northerly
side of Cedar Street;

thence Easterly along the said northerly side
of Cedar Street, 278 feet 7-5/8 inches to its intersection with the westerly
side of Broadway as now established;

thence Northerly along the said westerly side
of Broadway as now established, 94 feet 6-5/8 inches to the corner first
mentioned, at the point or place of Beginning, as more particularly shown on
that certain survey prepared by Earl B. Lovell - S.P. Belcher, Inc., dated June
1, 1973, redated July 28, 1987, which survey is incorporated herein by
reference.

 

I-11Exhibit 10.4.2

 

 

SUB-SUBLEASE AGREEMENT

 

 

FOLKSAMERICA REINSURANCE COMPANY,

 

 

As
Sub-Sublandlord,

 

AND

 

 

ARCH INSURANCE COMPANY,

 

 

As Sub-Subtenant

 

 

Dated as of the 31st day of
December, 2002

 

 

SUB-SUBLEASE
AGREEMENT

 

THIS SUB-SUBLEASE AGREEMENT (hereinafter
referred to as this “Sub-Sublease”)
is made as of the 31st day of December, 2002 by and between FOLKSAMERICA REINSURANCE COMPANY, a New
York corporation having an office at One Liberty Plaza, New York, New York
10006 (hereinafter referred to as “Sub-Sublandlord”)
and ARCH INSURANCE COMPANY, a
Missouri corporation having an office at One Liberty Plaza, New York, New York
10006 (hereinafter referred to as “Sub-Subtenant”).

 

WITNESSETH:

 

WHEREAS, pursuant to
that certain lease dated as of December 1, 1988, as supplemented and modified
by that certain first supplemental agreement dated May 8, 1998 (sometimes
hereinafter referred to as the “First
Supplemental Agreement”) (said lease, as so supplemented and
modified, hereinafter referred to as the “Prime
Lease”), between WFP One Liberty Plaza Co. L.P. (formerly known as
Olympia & York OLP Company and hereinafter referred to as “Prime Landlord”), as landlord, and
Generali – U.S. Branch (successor-in-interest to Generali Insurance Company of
Trieste & Venice and hereinafter referred to as “Prime Sublandlord”), as tenant, Prime Landlord leased to
Prime Sublandlord the entire (29th) twenty-ninth floor (hereinafter
referred to as the “Premises”) in
the building located at One Liberty Plaza, New York, New York (hereinafter
referred to as the “Building”);
and

 

WHEREAS, pursuant to
that certain agreement of sublease dated as of December 15, 1999, between Prime
Sublandlord, as sublandlord, and Sublandlord, as subtenant, as consented to
pursuant to that certain consent dated January 6, 2000 by and between Prime

 

1

 

Landlord, Prime Sublandlord and
Sublandlord (said sublease, as so consented to, hereinafter referred to as the “Prime Sublease”), Prime Sublandlord leased
to Sublandlord the Premises (hereinafter referred to as the “Original Sublet Premises”) consisting of
approximately 18,041 rentable square feet; and

 

WHEREAS,
Sub-Sublandlord wishes to sublease to Sub-Subtenant, and Sub-Subtenant wishes
to sublet from Sub-Sublandlord, the Original Sublet Premises (hereinafter
referred to as the “Sub-Sublet Premises”),
a diagram of which is set forth on Exhibit A
annexed hereto and which the parties hereto agree shall be deemed to consist of
the entire Original Sublet Premises.

 

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

 

1.                                      Sub-Subleasing

 

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

 

B.                                    The
term of this Sub-Sublease shall commence upon (i) the signing of this
Sub-Sublease by the parties and (ii) delivery of fully executed Consents by the
Prime Sublandlord and the Prime Landlord to the Sub-Subtenant (the
“Sub-Sublease Commencement Date”).  The
Consents will be delivered to the Sub-Subtenant via overnight mail no later
than two (2) business days after signing of the Sub-Sublease by the
parties.  The Sub-Subtenant acknowledges
that the Sub-Sublandlord’s work as set forth in Exhibit B has been fully satisfied.  The Sub-Sublease shall expire at midnight on December 29, 2009,
or such earlier date on which

 

2

 

this Sub-Sublease may expire or
be cancelled or terminated pursuant to its terms or as provided by law
(hereinafter referred to as the “Sub-Sublease
Expiration Date”).  When the
Sub-Sublease Commencement Date has occurred and been established, Sub-Sublandlord
and Sub-Subtenant shall, within thirty (30) days of a request by
Sub-Sublandlord or Sub-Subtenant, execute an agreement confirming such date as
the Sub-Sublease Commencement Date.  Any
failure of the parties to execute such agreement shall not affect the validity
of the Sub-Sublease Commencement Date, the Sub-Sublease Expiration Date or this
Sublease.

 

2.                                      Rent

 

A.                                    Sub-Subtenant
covenants and agrees to pay to Sub-Sublandlord rent (herein referred to as the “Fixed Rent”) for the Sub-Sublet Premises
as follows:  $414,943.00 per annum,
payable in equal monthly installments of $34,578.58 for the period (hereinafter
referred to as the “Rent Period”)
commencing seven (7) months after the Sub-Sublease Commencement Date
(hereinafter referred to as the “Sub-Sublease
Rent Commencement Date”) and ending on December 29, 2009.  Monthly installments of Fixed Rent shall be
payable in advance on the first day of each calendar month.

 

B.                                    Fixed
Rent and all other amounts payable by Sub-Subtenant to Sub-Sublandlord under
the provisions of this Sub-Sublease (herein referred to as the “Additional Rent”) shall be paid promptly
when due, without notice or demand therefore except as expressly provided in
this Sub-Sublease, and without deduction, abatement, counterclaim or setoff of
any amount or for any reason whatsoever. 
Fixed Rent and Additional Rent shall be paid to Sub-Sublandlord in
lawful money of the United States at the address of Sub-Sublandlord set forth
in Article 17 of this Sub-Sublease or to such other person and/or at such other
address as Sub-Sublandlord may from time to time designate by notice to
Sub-Subtenant as provided for herein.

 

3

 

Any Fixed Rent or Additional
Rent payable for less than a full month shall be pro-rated.  No payment by Sub-Subtenant or receipt by
Sub-Sublandlord of any lesser amount than the amount stipulated to be paid
hereunder shall be deemed other than on account of the earliest stipulated
Fixed Rent or Additional Rent; nor shall any endorsement or statement on any
check or letter be deemed an accord and satisfaction, and Sub-Sublandlord may
accept any check or payment without prejudice to Sub-Sublandlord’s right to
recover the balance due or to pursue any other remedy available to Sub-Sublandlord.  Any provision in the Prime Sublease or the
Prime Lease referring to rent, increases in rent or additional rent
incorporated herein by reference shall be deemed to refer to the Fixed Rent and
Additional Rent due under this Sub-Sublease.

 

C.                                    Within
thirty (30) days of receipt of an invoice therefor from Sub-Sublandlord,
Sub-Subtenant shall pay any payment on account of Additional Rent, including
without limitation payment on account of Tax Payments (as defined in Section
3.02 (a) of the Prime Lease) and payments on account of Operating Payments (as
defined in Section 3.03(a) of the Prime Lease).  The amounts to be paid by Sub-Subtenant shall be calculated in
accordance with Article 3 of the Prime Lease, except that (i) the term “Base
Operating Year” as set forth in Section 3.01(a) of the Prime Lease (as modified
by Paragraph 5(b) of the First Supplemental Agreement with respect to the
Premises and Paragraph 4(a) of the Prime Sublease with respect to the Original
Sublet Premises) shall mean the calendar year commencing on January 1, 2003 and
ending on December 31, 2003; (ii) the term “Base Tax Amount” as set forth in
Section 3.01(c) of the Prime Lease (as modified by Paragraph 5(b) of the First
Supplemental Agreement with respect to the Premises and Paragraph 4(a) of the
Prime Sublease with respect to the Original Sublet Premises) shall mean
one-half of the sum of (x) the Taxes for the Tax Year commencing July 1, 2002
and (y) the Taxes for the Tax Year commencing July 1, 2003, both as finally

 

4

 

determined.  Sub-Subtenant’s obligations under this
Article 2 shall be apportioned for any period at the beginning or end of the
term of this Sub-Sublease that is less than a full calendar year or fiscal
year.

 

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

 

E.                                      All
costs, expenses and fees other than Fixed Rent which Sub-Subtenant assumes or
agrees to pay pursuant to this Sub-Sublease shall be deemed Additional Rent
and, in the event of non-payment, Sub-Sublandlord shall have all the rights and
remedies provided for in the case of non-payment of Fixed Rent.

 

3.                                      Subordination
to Prime Sublease and Prime Lease

 

This Sub-Sublease is and shall be expressly subject and subordinate to
all of the terms, provisions, covenants, agreements and conditions of the Prime
Sublease and the Prime Lease.  This
Sub-Sublease is also subject and subordinate to all instruments, agreements and
other matters to which the Prime Sublease and the Prime Lease is or shall be
subject or subordinate.  Sub-Sublandlord
agrees, promptly after the execution of this Sub-Sublease by both parties, to
make a single written request to the Prime Sublandlord (the “Non-Disturbance

 

5

 

Request”) to issue its standard
form of non-disturbance agreement in favor of Sub-Subtenant with respect to
this Sub-Sublease.  Sub-Sublandlord
shall send a copy of the Non-Disturbance Request to Sub-Subtenant.  Sub-Subtenant expressly understands and
agrees that (a) Prime Sub-Landlord is under no obligation to issue a
non-disturbance agreement in favor of Sub-Subtenant,  (b) Sub-Sublandlord’s sole obligation under this Paragraph is to
send the Non-Disturbance Request to Prime Sublandlord (it being understood that
Sub-Sublandlord shall have no obligation to follow up with Prime-Sublandlord in
any manner whatsoever with respect to the issuance of a non-disturbance
agreement in favor of Sub-Subtenant), (c) Sub-Sublandlord shall have no
responsibility or liability of any kind to Sub-Subtenant if Prime Sublandlord
shall fail to issue a non-disturbance agreement in favor of Sub-Subtenant, and
(d) the failure of Prime Sub-landlord to issue a non-disturbance agreement in
favor of Sub-Subtenant shall have no effect on the validity or effectiveness of
this Sub-Sublease or the terms of this Sub-Sublease or the obligations of
Sub-Subtenant under this Sub-Sublease.

 

4.                                      Rights
and Obligations; Exceptions

 

A.                                    Sub-Sublandlord
represents that a true and complete copy of the Prime Lease and the Prime
Sublease have been delivered to Sub-Subtenant. 
Sub-Subtenant confirms that Sub-Subtenant has read the Prime Lease and
the Prime Sublease and is familiar with the terms and provisions thereof.  Except as otherwise expressly provided
herein, all of the terms, provisions, covenants, agreements and conditions of
the Prime Sublease (and, to the extent incorporated therein, the Prime Lease)
are incorporated herein by reference and made a part of this Sub-Sublease with
the same force and effect as though set forth in full herein.  Sub-Subtenant shall conform to, and use the
Sub-Sublet Premises in accordance with, all the terms, provisions, covenants,
agreements and conditions of the Prime Sublease (and, to the extent

 

6

 

incorporated therein, the Prime
Lease) as same apply to the Sub-Sublet Premises, and will do no act which will
result in a violation of said terms, provisions, covenants, agreements and
conditions.  Sub-Subtenant shall perform
the terms, provisions, covenants, agreements and conditions of the Prime
Sublease (and, to the extent incorporated therein, the Prime Lease) on the part
of the tenant therein named to be performed with respect to the Sub-Sublet
Premises (except as otherwise may be expressly provided herein).  To the extent there are inconsistencies
between any provision of the Prime Sublease (and, to the extent incorporated
therein, the Prime Lease) and any provision of this Sub-Sublease, this
Sub-Sublease shall control.

 

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

 

7

 

If Prime Sublandlord shall default in any of its obligations to
Sub-Sublandlord with respect to the Sub-Sublet Premises, Sub-Subtenant, at
Sub-Subtenant’s sole cost and expense, shall have the right in its own name,
and if required that of Sub-Sublandlord, or, if required, both, to bring an
action or proceeding with respect to such default.  Sub-Sublandlord agrees to take such steps as Sub-Subtenant may
reasonably request to cooperate with Sub-Subtenant in any such legal proceeding
or take any other action to enforce the obligation of Prime Sublandlord insofar
as such obligations relate to the Sub-Sublet Premises, Sub-Subtenant agrees to
indemnify and hold Sub-Sublandlord harmless from and against any costs,
liabilities, damages or expenses (including reasonable attorneys’ fees) which
Sub-Sublandlord may incur in connection therewith or by reason thereof.

 

Notwithstanding anything to the contrary in the forgoing,
Sub-Sublandlord shall promptly forward to Prime Sublandlord any requests or
other communications made by Sub-Subtenant related to the performance by Prime
Sublandlord of its obligations under the Prime Sublease, as they pertain to the
Sub-Sublet Premises, and shall promptly forward to Sub-Subtenant any
communication received from Prime Sublandlord related to the Sub-Sublet
Premises.

 

B.                                    Notwithstanding
anything to the contrary contained in this Sub-Sublease, the Prime Sublease or
the Prime Lease:

 

(i)                                     for
the purposes of incorporation of the Prime Sublease (and, to the extent
incorporated therein, the Prime Lease) by reference in this Sub-Sublease,
except as otherwise expressly provided herein, and except to the extent that
they are inapplicable or modified by the terms and provisions of this Sub-Sublease
(a) references in the Prime Sublease to the “Subleased Premises” and references
in the Prime Lease to the “premises” or the “demised

 

8

 

premises” shall be deemed to
refer to the Sub-Sublet Premises, (b) references in the Prime Sublease to
“Sublandlord” and references in the Prime Lease to “Landlord” shall be deemed
to refer to Sub-Sublandlord under this Sub-Sublease, (c) references in the
Prime Sublease to “Subtenant” and references in the Prime Lease to “Tenant”
shall be deemed to refer to Sub-Subtenant under this Sub-Sublease, (d)
references in the Prime Sublease to “this Sublease” and references in the Prime
Lease to “this lease” shall be deemed to refer to this Sub-Sublease, (e)
references in the Prime Sublease to the “term” of the Prime Sublease and
references in the Prime Lease to the “term” of the Prime Lease shall be deemed
to refer to the term of this Sub-Sublease, (f) references in the Prime Sublease
to the “Expiration Date” and references in the Prime Lease to the “expiration
date” or the “termination date” shall be deemed to refer to the Sub-Sublease
Expiration Date, (g) references in the Prime Sublease to the “Commencement
Date” and references in the Prime Lease to the “Commencement Date” shall be
deemed to refer to the Sub-Sublease Commencement Date and (h) where Prime
Sublandlord’s or Prime Landlord’s consent is required pursuant to the Prime
Sublease or the Prime Lease, as the case may be, Prime Sublandlord’s, Prime
Landlord’s and Sub-Sublandlord’s consent shall be required and Sub-Sublandlord
shall not be deemed to have unreasonably withheld its consent if Prime
Sublandlord and/or Prime Landlord, as the case may be, shall fail or refuse to
give its consent and Sub-Sublandlord agrees that it shall not unreasonably
withhold or delay its consent where Prime Sublandlord and Prime Landlord have
granted their consent;

 

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

 

(iii)                               the
time limits contained in the Prime Sublease for the giving of notices, making
of demands or performing of any act, condition or covenant on the part of the

 

9

 

tenant thereunder, or for the
exercise by the tenant thereunder of any right, remedy or option, are for the
purposes of incorporation herein by reference the same, so that in each
instance Sub-Subtenant shall have the same time to observe or perform hereunder
as Sub-Sublandlord has as the tenant under the Prime Sublease;

 

(iv)                              the
following parts, provisions and exhibits of the Prime Sublease are not
applicable to this Sub-Sublease, and are not incorporated herein by reference:

 

(a)                                  Paragraphs 3, 19 and
20; and

 

(b)                                 The third sentence of
Paragraph 13(b)

 

5.                                      Use

 

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

 

6.                                      Electricity

 

Sub-Sublandlord represents to Sub-Subtenant that there is an existing
submeter which is exclusively for the Sub-Sublet Premises and located
therein.  Sub-Subtenant shall pay
Sub-Sublandlord for electricity supplied to the Sub-Sublet Premises as measured
by the aforesaid submeter. 
Sub-Subtenant shall provide Sub-Sublandlord with reasonable access to
the aforesaid submeter in order to determine Sub-Subtenant’s electric
consumption in the Sub-Sublet Premises and for all other reasonable
purposes.  The provisions of Article 14
of the Prime Lease, including without limitation, the provisions relating to
the payment by Sub-Subtenant to Sub-Sublandlord for electricity at “Landlord’s
Rate” (set forth in Section 14.01(b) of the Prime Lease as 105% of the amount
at which Prime Landlord from time to time purchases each KW and KWHR of
electricity from the utility company providing same for the period in
question), shall be

 

10

 

applicable to this
Sub-Sublease.  The payments for
electricity shall be in addition to the Fixed Rent and other Additional Rent
payable under this Sub-Sublease.

 

7.                                      Default

 

Sub-Subtenant covenants and agrees that in the event that it shall
default in the performance of any of the terms, covenants and conditions of
this Sub-Sublease (including those portions of the Prime Sublease and, to the
extent incorporated therein, the Prime Lease, incorporated herein by reference)
beyond any applicable notice and grace period provided for in the Prime
Sublease and incorporated herein by reference Sub-Sublandlord shall be entitled
to exercise any and all of the rights and remedies to which it is entitled by
law or in equity, including, without limitation, the remedy of summary
proceeding, and also any and all of the rights and remedies specifically
provided for in the Prime Sublease (and, to the extent incorporated therein,
the Prime Lease ) and incorporated herein by reference.  Notwithstanding anything to the contrary in
this Sub-Sublease, the Prime Sublease or the Prime Lease, Sub-Subtenant shall
not be deemed in default for non-payment of Fixed Rent or Additional Rent or
any other sums due hereunder unless Sub-Subtenant shall fail to pay any such
sums on the due date thereof and such default shall continue for a period of
ten (10) days after written notice by Sub-Sublandlord to Sub-Subtenant of such
default.

 

8.                                      Condition
of Sub-Sublet Premises

 

The Sub-Sublet Premises are demised to Sub-Subtenant in the “as is”
condition which exists on the date hereof and shall include all of the existing
furniture now located within the Sub-Sublet Premises and set forth on Exhibit C annexed hereto (hereinafter
referred to as the “Included Furniture”).  Sub-Sublandlord represents to Sub-Subtenant
that upon the expiration

 

11

 

of Sub-Sublandlord’s current
furniture lease between General Electric Capital Corporation (“General Electric”)  and Folksamerica Reinsurance Company dated
August 23, 2000 (the “Furniture Lease”)
which includes part of the Included Furniture, Sub-Sublandlord shall automatically
acquire free and clear title thereto and promptly transfer ownership of the
portion of the Included Furniture that is subject to the Furniture Lease (as
set forth on Exhibit C-1) to Sub-Subtenant by bill of sale in form and
substance satisfactory to Sub-Subtenant for consideration in the amount of
$1.00, provided however, that Sub-Subtenant is not in default in whole or in
part of the Sub-Sublease (provided, however, Sub-Subtenant shall have the
opportunity to cure any default under this Sub-Sublease within a reasonable
time after notice of such default has been provided by Sub-Sublandlord to
Sub-Subtenant of the details of such default). 
Sub-Sublandlord represents that a copy of the Furniture Lease is attached
hereto as Exhibit D.  Sub-Sublandlord agrees to comply with any
and all of its financial obligations under the Furniture Lease on a timely
basis.  Sub-Sublandlord shall indemnify
Sub-Subtenant for any default occurring in connection with the Furniture Lease
(including reasonable attorney’s fees) if and when General Electric notifies
Sub-Sublandlord of any default under the Furniture Lease which default is not
cured by Sub-Sublandlord within a reasonable period of time and Sub-Sublandlord
shall promptly pay Sub-Subtenant for any actual damages incurred by
Sub-Subtenant as a result of a Sub-Sublandlord’s default on the Furniture Lease
which is not cured as provided for herein. 
Provided further, Sub-Sublandlord shall notify Sub-Subtenant of any
alleged default under the Furniture Lease and provide reasonable assurances
concerning Sub-Sublandlord’s cure of such default and absent such assurances,
Sub-Subtenant shall have the right to cure the default under the Furniture
Lease and Sub-Sublandlord shall indemnify Sub-Subtenant as provided herein including
the payment of reasonable attorney’s fees. 
That portion

 

12

 

of the Included Furniture not
covered by the Furniture Lease is set forth on Exhibit C-2 and is represented
by Sub-Sublandlord to be without encumbrances, liens or amounts owing on such
furniture and is transferred to Sub-Subtenant upon the execution of this
Sub-Sublease.

 

9.                                      Improvements

 

A.                                    Sub-Subtenant
may make changes, alterations, additions or improvements to the Sub-Sublet
Premises, subject, however, to the consent of Sub-Sublandlord, Prime
Sublandlord (to the extent required under the Prime Sublease) and Prime
Landlord (to the extent required under the Prime Lease).  Sub-Sublandlord agrees that it shall not
unreasonably withhold or delay its consent to any changes, alterations,
additions or improvements to the Sub-Sublet Premises consented to by Prime
Sublandlord and Prime Landlord and, if not previously given, Sub-Sublandlord’s
consent shall be deemed to have been given within ten (10) business days of
Prime Sublandlord’s and Prime Landlord’s consents.  Any changes, alterations, additions or improvements by or on
behalf of Sub-Subtenant shall be made subject to and in accordance with the
provisions of the Prime Sublease and the Prime Lease.  Sub-Subtenant shall in no event have any restoration obligation
with respect to any part of the installation which currently exists in the
Sub-Sublet Premises, Sub-Sublandlord hereby agreeing that with respect to such
installation and conditions which existed prior to the Sub-Sublease
Commencement Date, Sub-Sublandlord shall be solely responsible for all costs
which may be imposed on Sub-Sublandlord under the Prime Sublease (and, to the
extent incorporated therein, the Prime Lease) in connection with the condition
of the Sub-Sublet Premises.

 

B.                                    Sub-Subtenant
shall pay any and all actual out-of-pocket fees or charges Sub-Sublandlord may
incur and any and all fees or charges Prime Sublandlord or Prime

 

13

 

Landlord may incur in
connection with Sub-Subtenant’s making changes, alterations, additions or
improvements to the Sub-Sublet Premises.

 

10.                               Additional
Services Required by Sub-Subtenant

 

Sub-Subtenant shall attempt to make its own arrangements with Prime
Landlord for the furnishing of additional services to the Sub-Sublet Premises
other than those which are required to be furnished by Prime Landlord under the
terms of the Prime Lease and any such additional services shall be paid for by
Sub-Subtenant.  For the purposes of this
Article 10, the term “additional services” shall include, but not be limited
to, overtime HVAC service, overtime freight elevator service and increased
capacity of electric energy.

 

11.                               Assignment
and Subletting

 

A.                                    Sub-Subtenant
for itself, its successors and assigns, expressly covenants that it shall not
assign, mortgage or encumber this Sub-Sublease, nor further sublet, or suffer
or permit the Sub-Sublet Premises or any part thereof to be used by others
without the consent of Sub-Sublandlord and Prime Sublandlord (to the extent
required under the Prime Sublease) and Prime Landlord (to the extent required
under the Prime Lease).

 

B.                                    Sub-Sublandlord
agrees that its consent to any proposed assignment or subletting by
Sub-Subtenant shall not be unreasonably withheld or delayed so long as
Sub-Subtenant and the proposed subtenant or assignee shall (i) deliver to
Sub-Sublandlord (a) in the case of a proposed assignment, an instrument of
assignment complying with the terms of the Prime Sublease and the Prime Lease,
in form and substance reasonably satisfactory to Sub-Sublandlord, duly executed
by Sub-Subtenant and such assignee, in which such assignee shall assume
observance and performance of, and agree to be bound by, all of the terms, covenants

 

14

 

and conditions of this
Sub-Sublease on Sub-Subtenant’s part to be performed, or (b) in the case of a
proposed subletting, a sublease agreement on terms and conditions complying
with the terms of the Prime Sublease and the Prime Lease, in form and substance
reasonably satisfactory to Sub-Sublandlord, duly executed by Sub-Subtenant and
the proposed subtenant and (ii) obtain the consent of Prime Sublandlord (if
required under the Prime Sublease) and of Prime Landlord (if required under the
Prime Lease) and deliver to Sub-Sublandlord a fully executed counterpart of any
instrument required by Prime Sublandlord or Prime Landlord in connection with
their respective consents to such transaction, and (iii) pay or cause to be
paid to Sub-Sublandlord, Prime Sublandlord and Prime Landlord any reasonable
costs that may be incurred by Sub-Sublandlord, Prime Sublandlord or Prime
Landlord in connection with said assignment or sublease, including, without
limitation, the costs of making investigations as to the acceptability of the
proposed assignee or subtenant and reasonable legal costs incurred in
connection with the review of any term sheet, proposed assignment or sublease
or any documentation in connection therewith and in the preparation of any
documentation in connection with any request for consent, whether or not
granted.  Each such assignment
instrument or sublease shall contain a provision to the effect that such instrument
or sublease shall not be effective unless and until Sub-Sublandlord, Prime
Sublandlord (if required under the Prime Sublease) and Prime Landlord (if
required under the Prime Lease) shall have consented thereto.

 

12.                               Attornment

 

In the event of termination, re-entry or dispossession of Sub-Sublandlord
by Prime Sublandlord under the Prime Sublease, Prime Sublandlord may, at its
option, take over all of the right, title and interest of Sub-Sublandlord under
this Sub-Sublease, and Sub-Subtenant shall, at Prime Sublandlord’s option,
attorn to Prime Sublandlord pursuant to the then executory

 

15

 

provisions of this
Sub-Sublease, except that Prime Sublandlord shall not (i) be liable for any
previous act, omission or negligence of Sub-Sublandlord under this
Sub-Sublease, which heretofore has accrued to Sub-Subtenant against
Sub-Sublandlord, (ii) be subject to any counterclaim, defense or offset not
expressly provided for in this Sub-Sublease which theretofore accrued to
Sub-Subtenant against Sub-Sublandlord, (iii) be bound by any previous
modification of this Sub-Sublease not consented to by Prime Sublandlord or by
any previous prepayment of more than one month’s Fixed Rent and Additional
Rent, or (iv) be bound to perform any work which Sub-Sublandlord is obligated
to perform hereunder, or to pay Sub-Subtenant or any other person or entity for
the same.  Sub-Subtenant hereby waives
all rights under any present or future laws or otherwise to elect, by reason of
the termination of the Prime Sublease, to terminate this Sub-Sublease or
surrender possession of the Sub-Sublet Premises demised hereby.  Nothing in this Article 12 shall be deemed
to affect any liability that Sub-Sublandlord may have to Sub-Subtenant pursuant
to this Sub-Sublease.

 

13.                               Sub-Subtenant’s
Representation and Warranties

 

Sub-Subtenant covenants, warrants and represents:

 

(a)                                  that
Sub-Subtenant shall perform all of its obligations under this Sub-Sublease
(including, without limitation, all of the obligations relating to the
Sub-Sublet Premises arising under the Prime Sublease and, to the extent
incorporated therein, the Prime Lease, which are incorporated herein by
reference);

 

(b)                                 that
Sub-Subtenant will not do or omit to do anything which would constitute a
default under the provisions of the Prime Sublease or, to the extent
incorporated therein, the Prime Lease, incorporated herein by reference; and

 

16

 

(c)                                  that
Sub-Subtenant shall indemnify, defend and hold harmless Sub-Sublandlord, Prime
Sublandlord and Prime Landlord and their respective agents and employees from
and against any and all claims, liabilities, damages, losses or expenses
(including, without limitation, reasonable attorneys fees) which may be imposed
upon or incurred by or asserted against Sub-Sublandlord and/or Prime
Sublandlord and/or Prime Landlord and/or their respective agents or employees
by reason of (i) Sub-Subtenant’s failure to comply with the provisions of this
Sub-Sublease, (ii) the negligent or improper use or occupancy of the Sub-Sublet
Premises by Sub-Subtenant or its successors or assigns, (iii) any work or thing
done whatsoever by or at the instance of Sub-Subtenant, its agents,
contractors, subcontractors, employees, licensees, successors or assigns, or any
condition created by Sub-Subtenant, its agents, contractors, subcontractors,
employees, licensees, successors or assigns in, on or about the Sub-Sublet
Premises,  (iv)
any negligence or other wrongful act or omission on the part of Sub-Subtenant
or any of its agents, contractors, subcontractors, employees, licensees,
successors or assigns, or (v) any accident, injury or damage to any person or
property occurring in, on or about the Sub-Sublet Premises or any part thereof
during the term of this Sub-Sublease, except to the extent caused by the
negligence or willful misconduct of Sub-Sublandlord (with respect to a claim
against Sub-Sublandlord), Prime Sublandlord (with respect to a claim against
Prime Sublandlord) or Prime Landlord (with respect to a claim against Prime
Landlord).  In case any action or
proceeding is brought against Sub-Sublandlord, Prime Sublandlord and/or Prime
Landlord and/or their respective agents and employees by reason of any such
claim, Sub-Sublandlord shall not settle the same without Sub-Subtenant’s
written consent and Sub-Subtenant, upon written notice from Sub-Sublandlord,
Prime Sublandlord and/or Prime

 

17

 

Landlord, shall at
Sub-Subtenant’s expense resist and defend such action or proceeding by counsel
approved by Sub-Sublandlord, Prime Sublandlord and/or Prime Landlord in
writing.

 

14.                               Estoppel

 

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

 

15.                               Brokers

 

Insignia/ESG is the broker involved in connection with this
Sub-Sublease.  Sub-Sublandlord and
Sub-Subtenant each agree to indemnify and hold harmless the other against and
from any and all claims for any brokerage commissions and all costs, expenses
and liabilities in connection therewith including, without limitation,
attorney’s fees and expenses, made by any broker or agent arising from any
breach by either Sub-Sublandlord or Sub-Subtenant of the foregoing
representation and warranty made by it. 
Any commission due to the above-identified broker shall be paid by
Sub-Sublandlord pursuant to separate agreement and Sub-Sublandlord shall hold
harmless and indemnify Sub-Subtenant from and against any claim made against
Sub-

 

18

 

Subtenant by the
above-identified broker for any commission owing as a result of this
Sub-Sublease.

 

16.                               Sub-Sublandlord’s
Performance Under Prime Sublease

 

A.                                    Sub-Sublandlord
will duly observe and perform every term and condition of the Prime Sublease to
the extent that such term and condition is not provided in this Sub-Sublease to
be observed or performed by Sub-Subtenant (and except to the extent that any
failure so to pay or any failure in such observance or performance shall have
resulted, directly or indirectly, from any default by Sub-Subtenant in its
obligations to pay any amount of the Fixed Rent or Additional Rent hereunder or
to observe or perform any of the terms, covenants or conditions in this
Sub-Sublease or in the Prime Sublease on Sub-Subtenant’s part to observe or
perform with respect to the Sub-Sublet Premises).

 

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

 

17.                               Notices

 

All notices, requests, demands, and other communications hereunder
shall be in writing, shall be sent by registered or certified mail, return
receipt requested, or by nationally recognized overnight carrier providing for
receipted delivery or by hand delivery and shall be

 

19

 

deemed have been given or made
when received (or rejected) at the address as first set forth above.  Any of the said addresses may be changed on
ten (10) days written notice, given as above provided.

 

18.                               Insurance

 

Sub-Subtenant shall maintain, with respect to the Sub-Sublet Premises,
all insurance required of Sub-Sublandlord as tenant in accordance with and
pursuant to the Prime Sublease, which insurance shall name, as additional
insureds, Prime Landlord, Prime Sublandlord and Sub-Sublandlord and any other
persons or entities required to be so named pursuant to the provisions of the
Prime Sublease as additional insureds. 
A certificate evidencing such insurance coverage shall be delivered to
Sub-Sublandlord upon the execution and delivery hereof by Sub-Subtenant.

 

19.                               Entire
Agreement

 

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

 

20.                               New
York Law

 

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

 

21.                               Successors
and Assigns

 

The provisions of this Sub-Sublease, except as herein otherwise
specifically provided, shall extend to, bind and inure to the benefit of the
parties hereto and their respective successors and, in the case of
Sub-Sublandlord, assigns.  In the event
of any assignment or

 

20

 

transfer of the leasehold
estate under the Prime Sublease the transferor or assignor, as the case may be,
shall be and hereby is entirely relieved and freed of all obligations under
this Sub-Sublease upon the assumption by the transferee or assignee of
Sub-Sublandlord’s obligations hereunder.

 

22.                               Directory
and Signage

 

A.                                    Sub-Sublandlord
agrees to permit Sub-Subtenant to use the building directory that Sub-Sublandlord
is permitted to use pursuant to the provisions of the Prime Sublease and the
Prime Lease.

 

B.                                    Any
signs which Sub-Subtenant may desire to install in or on the Sub-Sublet
Premises, shall be subject to the provisions of the Prime Sublease and the Prime
Lease and shall be furnished, maintained and installed by Sub-Subtenant, at its
sole cost and expense.

 

23.                               Prime
Landlord’s and Prime Sublandlord’s Consent; Binding Effect

 

A.                                    Upon
execution hereof, this Sub-Sublease shall be delivered to Prime Landlord and
Prime Sublandlord for their consent.

 

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

 

C.                                    Sub-Sublandlord
agrees, promptly after the execution of this Sub-Sublease by both parties, to
make written request to Prime Landlord, Prime Sublandlord and any other
parties, now or hereafter having a superior position to this Sub-Sublease,
issue non-disturbance agreements in favor of Sub-Subtenant (in form and
substance reasonably satisfactory to Sub-Subtenant) with respect to this
Sub-Sublease.

 

21

 

24.                               Nonliability
for Prime Landlord’s or Prime Sublandlord’s Failure to Consent; Disclaimer of
Liability

 

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

 

25.                               Work
Allowance

 

Sub-Subtenant shall be provided with a work allowance by the
Sub-Sublandlord in the amount of $36,082.00 ($2.00 per rentable square foot of
the Premises).  The Work Allowance shall
be transferred by the Sub-Sublandlord to the Sub-Subtenant in the form of a
credit against the Fixed Rent first becoming due and payable hereunder.

 

26.                               Miscellaneous

 

Sub-Sublandlord shall cooperate with Sub-Subtenant in connection with
Sub-Subtenant’s efforts to obtain any permissible benefits under any of the
lower Manhattan benefit plans now or hereafter existing (hereinafter referred
to as the “Lower Manhattan Benefits”)
and Sub-Sublandlord shall join in the execution and delivery of any
applications, documents or other instruments required in connection therewith
so as to pass through to Sub-Subtenant any such benefits allocable to the
Sub-Sublet Premises.  Sub-Sublandlord
further agrees to take such

 

22

 

steps and make such requests as
are necessary to obtain the cooperation of Prime Landlord and Prime Sublandlord
in connection with Sub-Subtenant’s efforts to obtain any of the Lower Manhattan
Benefits.

 

23

 

IN WITNESS WHEREOF,
this Sub-Sublease, together with the Rider attached hereto as Exhibit F and
made a part hereof, has been duly executed as of the date first set forth
above.

 

	
   

  	
  SUB-SUBLANDLORD:

  
	
   

  	
   

  
	
   

  	
  FOLKSAMERICA REINSURANCE COMPANY,

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John H. Haley

  
	
   

  	
   

  	
  Name: John H. Haley

  
	
   

  	
   

  	
  Title: Senior Vice President and Assistant
  General Counsel

  
	
   

  	
   

  
	
   

  	
  SUB-SUBTENANT:

  
	
   

  	
   

  
	
   

  	
  ARCH INSURANCE COMPANY,

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Constantine Iordanou

  
	
   

  	
   

  	
  Name: Constantine Iordanou

  
	
   

  	
   

  	
  Title: President

  
	
   

  	
   

  
	
   

  	
  Sub-Subtenant’s Employer Identification No.

  
	
   

  	
   

  
	
   

  	
  43 0990710

  
				

 

24

 

EXHIBIT A

 

Floor Plan

 

 

[Intentionally omitted]

 

 

EXHIBIT B

 

Sub-Sublandlord’s Work

 

 

[Intentionally omitted]

 

 

EXHIBIT C

 

Included Furniture

 

 

[Intentionally omitted]

 

 

EXHIBIT D

 

Furniture Lease

 

 

[Intentionally omitted]

 

 

EXHIBIT E

 

Prime Sublease

 

 

[Intentionally omitted]

 

 

EXHIBIT F

RIDER TO SUB-SUBLEASE

BETWEEN

FOLKSAMERICA REINSURANCE COMPANY (“SUB-SUBLANDLORD”)

AND

ARCH INSURANCE COMPANY (“SUB-SUBTENANT”)

 

 

1.                                       Incorporation;
Conflicts; Terms.  This Rider (the
“Rider”) is attached to and incorporated into the above-referenced
Sub-Sublease.  Notwithstanding anything
to the contrary contained in the Sub-Sublease, the provisions of this Rider
shall apply to the Sub-Sublease, and in the event of any conflicts or
inconsistencies between the Sub-Sublease and this Rider, this Rider shall
control in each instance.  For purposes
of construing this Rider, the terms used herein shall have their counterpart
definitions or meanings used in the Sub-Sublease.

 

2.                                       Sub-Sublet
Premises; Condition. 
Sub-Sublandlord hereby warrants and represents that, as of the date
hereof, to the best of Sub-Sublandlord’s knowledge, information and belief (a)
all mechanical equipment and utility, plumbing, HVAC and electrical systems
serving the Sub-Sublet Premises are in reasonably good working order and repair
(and Sub-Sublandlord hereby covenants not to knowingly do or fail to do
anything to render such equipment and systems inoperable or in disrepair); and
(b) Sub-Sublet Premises are in material compliance with all applicable local,
state and/or federal laws, statutes, ordinances and codes (collectively, the
“Applicable Laws”).

 

3.                                       Early
Access.  Sub-Sublandlord agrees,
upon written request from Sub-Subtenant, to provide Sub-Subtenant and/or
Sub-Subtenant’s agents, contractors and subcontractors with access to the
Sub-Sublet Premises, prior to the Sub-Sublease Commencement Date, during normal
business hours as provided in the Sub-Sublease, to take measurements and/or
perform inspections, provided, however, that Sub-Subtenant hereby agrees to
indemnify Sub-Sublandlord for any damage to the Sub-Sublet Premises or its
contents caused by Sub-Subtenant and/or such parties, and such access shall be
conducted in a manner that does not unreasonably interfere with
Sub-Sublandlord’s business operations or reasonable security requirements.

 

4.                                       Indemnities.  Sub-Subtenant’s indemnity of Sub-Sublandlord
shall specifically exclude any losses, liabilities, claims, damages or expenses
arising from the negligence or misconduct of Sub-Sublandlord or
Sub-Sublandlord’s agents, employees, contractors or visitors or arising from
Sub-Sublandlord’s breach of its obligations or representations under the Prime
Sublease or the Sub-Sublease. 
Sub-Sublandlord hereby agrees to indemnify, defend and hold Subtenant
harmless from and against any and all losses, liabilities, claims, damages or
expenses (including, without limitation, reasonable attorneys’ fees and costs)
arising in connection with the 
negligence or misconduct of Sub-Sublandlord or Sub-Sublandlord’s agents,
employees, contractors or visitors arising from or in connection with
Sub-Sublandlord’s breach of its obligations under the Prime Sublease or the
Sub-Sublease.

 

1

 

5.                                       No
Offer.  The Sub-Sublease shall not
be deemed an offer, and shall not be binding on either party hereto unless and
until final Sub-Sublease counterparts are executed by and delivered to both of
such parties.

 

6.                                       Sublease.  Sub-Sublandlord hereby warrants and
represents that, to the best of its knowledge, information and belief, (a) it
holds the entire subleasehold interest to the Sub-Sublet Premises pursuant to
the Prime Sublease; (b) the Prime Sublease is in full force and effect as of
the date hereof; (c) that copies of the instrument(s) comprising the Prime Sublease
are attached to the Sub-Sublease as Exhibit E
and represent true and complete copies of the Prime Sublease in its entirety,
and that the Prime Sublease has not been further amended to modified; (d) that
Sub-Sublandlord shall not amend or modify the Prime Sublease in any manner
which adversely affects the Sub-Subtenant’s subleasehold estate hereunder;
and(e) that, as of the date hereof, there are no pending claims or disputes
between Sub-Sublandlord and Prime Sublandlord or Prime Landlord in connection
with the Prime Sublease, and, to the best of Sub-Sublandlord’s knowledge, none
are threatened.  Sub-Sublandlord hereby
covenants that throughout the term, Sub-Sublandlord shall timely perform its
obligations under the Prime Sublease and the Sub-Sublease, and shall not, by
its actions or omissions, cause a default or termination of the Prime Sublease
which adversely affects Sub-Subtenant’s subleasehold estate.

 

7.                                       Consents;
Sub-Sublease Commencement Date. 
Notwithstanding anything to the contrary contained herein the
Sub-Sublease Commencement Date shall not occur until the date on which
Sub-Sublandlord and Sub-Subtenant receive executed and delivered written
consents from Prime Landlord and Prime Sublandlord (collectively, the
“Consents”) in form and substance reasonably satisfactory to both
Sub-Sublandlord and Sub-Subtenant.  In
addition, the Sub-Sublease Commencement Date shall not occur until
Sub-Sublandlord shall deliver exclusive possession of the Sub-Sublet Premises
to Sub-Subtenant with all “Sub-Sublandlord’s Work” (as hereinafter defined)
completed.

 

8.                                       Sub-Sublet
Premises Fit-Up; Sub-Sublandlord’s Work. 
For purposes hereof, “Sub-Sublandlord’s Work” shall encompass those
items set forth in Exhibit B,
delivery of the Sub-Sublet Premises vacant and broom-clean (except for the
items set forth in Exhibit C), all
systems and structures in good order and repair.

 

9.                                       Compliance.  Sub-Subtenant’s legal compliance obligations
under the Sub-Sublease shall consist solely of complying with those applicable
laws, codes, statutes, ordinances, rules and regulations relating to
Sub-Subtenant’s business in the Sub-Sublet Premises (or to any fit-up
alterations made by Sub-Subtenant).

 

10.                                 Alterations.  Sub-Subtenant shall have the right to
perform minor cosmetic decorating and remodeling in the Sub-Sublet Premises
without obtaining Sub-Sublandlord’s prior written consent.  Sub-Sublandlord agrees not to unreasonably
withhold, condition or delay its consent to any other alterations requested by
Sub-Subtenant.

 

11.                                 Insurance.  Sub-Sublandlord and Sub-Subtenant hereby
waive all rights to recover against each other for any loss or damage arising
from any cost covered by any casualty insurance required under the Sub-Sublease
or the Prime Sublease, or otherwise actually carried

 

2

 

by each of them.  Sub-Sublandlord and Sub-Subtenant will cause
their respective insurers to issue appropriate waiver of subrogation right
endorsements to all policies and insurance carried in connection with the
Sub-Sublet Premises or the contents of either of them. Sub-Sublandlord and
Sub-Subtenant hereby agree to look first to the proceeds of their respective
insurance policies before proceeding against each other in connection with any
claim relating to any matter covered by the Sub-Sublease.

 

12.                                 Access.  Sub-Subtenant shall have access and use of
the Sub-Sublet Premises twenty-four (24) hours per day, seven (7) days per
week, subject to the provisions of the Prime Sublease.  Any and all entry or access rights of
Sub-Sublandlord to the Sub-Sublet Premises , in each instance, shall only be
exercised upon reasonable advance notice of Sub-Subtenant (except in cases of
emergency when no such notice is required), in a manner consistent with
Sub-Subtenant’s reasonable security requirements, and in a manner which does
not unreasonably interfere with Sub-Subtenant’s business operations.

 

13.                                 Quiet
Enjoyment.  Sub-Sublandlord hereby
covenants that as long as Sub-Subtenant is not in default under the
Sub-Sublease, Sub-Subtenant shall quietly have, hold and enjoy the Sub-Sublet
Premises.

 

14.                                 Environmental.  Sub-Sublandlord hereby warrants and
represents that is has no knowledge of any materials or substances
(collectively, “Hazardous Materials”) in or about the Sub-Sublet Premises, the
Building or the underlying Land, which are environmentally hazardous or
harmful, or which violate any applicable federal, state or local laws, codes,
statutes, ordinances, guidelines, rules and regulations (collectively,
“Environmental Laws”).  Said Hazardous
Materials include, without limitation, asbestos, radon, PCB’s or petroleum
products.  Sub-Subtenant shall have not
liability whatsoever in connection with any and all Hazardous Materials not
deposited or created by Sub-Subtenant.

 

15.                                 Sub-Sublandlord’s
Rights.  Sub-Sublandlord hereby
warrants and represents that it has the full right, power and authority to
lease the Sub-Sublet Premises to Sub-Subtenant as provided in the Sub-Sublease.

 

16.                                 Attorneys’
Fees.  In the event Sub-Sublandlord
and Sub-Subtenant engage in any litigation regarding any subject matter
relating to the Sub-Sublease, the unsuccessful litigant shall pay the
successful litigant all reasonable costs and expenses, including, without
limitation, reasonable attorneys’ fees and costs, incurred by the successful
litigant in connection with such litigation.

 

17.                                 Surrender.  Sub-Subtenant’s surrender obligations under
the Sub-Sublease shall consist solely of returning the Sub-Sublet Premises to
Sub-Sublandlord vacant and in reasonably good order and repair, reasonable wear
and tear, damage by casualty, and Sub-Sublandlord’s obligations, excepted.  Sub-Subtenant shall have no obligation to
remove or pay for the removal of the initial fit-up of the Sub-Sublet Premises,
or any subsequent alterations which Sub-Sublandlord has approved during the
Term.  Nothing in the Sub-Sublease shall
preclude Sub-Subtenant from removing its trade fixtures, personal property or
business equipment from the 

 

3

 

Sub-Sublet Premises, provided
Sub-Subtenant reasonably repairs any portions of the Sub-Sublet Premises
affected by such removal.

 

18.                                 No
Assumption.  Except as specifically
provided in this Sub-Sublease, Sub-Subtenant is not assuming Sub-Sublandlord’s
monetary or other obligations under the Prime Sublease, nor any liabilities
attributable to Sub-Sublandlord’s negligence, actions, omission, misconduct or
breaches of the Prime Sublease.

 

19.                                 Cooperation.  Sub-Sublandlord hereby covenants that, upon
notice from Sub-Subtenant, Sub-Sublandlord shall promptly and diligently and in
good faith assist Sub-Subtenant in obtaining (a) the performance of Prime
Sublandlord’s obligations under the Prime Sublease; and (b) the consent by
either Prime Sublandlord or Prime Landlord to any approval or consent
reasonably requested by Sub-Subtenant. 
In addition, Sub-Sublandlord hereby covenants to cooperate in good faith
with Sub-Subtenant in the performance of any fit-up of the Sub-Sublet Premises
to avoid any delays or interference in connection with said work.

 

20.                                 Miscellaneous
Rights.  Any and all rent abatement
and leasehold termination rights granted to Sub-Sublandlord under the Prime
Sublease shall likewise apply to Sub-Subtenant under the Sub-Sublease, said rights
to include, without limitation, any such rights to Sub-Sublandlord for casualty
losses and/or condemnation under the Prime Sublease.

 

21.                                 Sub-Sublandlord
shall use reasonable efforts to cooperate with Sub-Subtenant in (i) obtaining
for Sub-Subtenant: (a) additional services requested by Sub-Subtenant under the
Prime Sublease and/or the Prime Lease (as incorporated in this Sub-Sublease)
and this Sub-Sublease; (b) any benefit to Sub-Sublandlord relating to the
Sub-Sublet Premises under the Prime Sublease or Prime Lease that would directly
benefit Sub-Subtenant, including without limitation any dispute rights
regarding operating expenses, real estate taxes, other escalations, or
electricity payments as set forth in the Prime Lease; and (ii) delivering any
notice to Prime Sublandlord or Prime Landlord as required by any provision of
the Prime Sublease or Prime Lease, as incorporated into this Sub-Sublease,
including, without limitation, promptly forwarding any request made by
Sub-Subtenant to Prime Sublandlord or Prime Landlord for services, or consent
or approval, and providing Prime Sublandlord or Prime Landlord with all
information required (or that Prime Sublandlord or Prime Landlord may
reasonably request) regarding any such request.  If Prime Sublandlord or Prime Landlord consents to any mater that
requires Prime Sublandlord or Prime Landlord’s consent under the Prime Sublease
or Prime Lease, then Sub-Sublandlord shall automatically be deemed to have
given such consent under this Sub-Sublease.

 

4

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