Document:

Exhibit 10.44

 

 

366 MADISON,
INC.,

 

LANDLORD

 

with

 

SILIPOS, INC.,

 

TENANT

 

LEASE

 

Dated as of April    ,
1995

 

	
   

  	
  PREMISES :

  	
   

  	
  A portion of the

  
	
   

  	
   

  	
  Sixteenth Floor

  
	
   

  	
   

  	
  366 Madison Avenue

  
	
   

  	
   

  	
  New York, New York

  

 

 

FISCHBEIN • BADILLO • WAGNER • ITZLER

909 Third Avenue

New York, New York 10022

Hugh M.
Heller, Esq.

 

 

TABLE OF CONTENTS

 

	
  Articles

  	
   

  	
  Caption

  	
   

  	
  Page

  
	
  1

  	
   

  	
  DEMISE - PREMISES -TERMS 

  	
   

  	
  1

  
	
  2

  	
   

  	
  DEFINITIONS
  

  	
   

  	
  1

  
	
  3

  	
   

  	
  RENT

  	
   

  	
  3

  
	
  4

  	
   

  	
  ADJUSTMENT
  OF RENT FOR CHANGES IN REAL ESTATE TAXES AND WAGE RATES 

  	
   

  	
  5

  
	
  5

  	
   

  	
  PREPARATION FOR
  TENANT’S OCCUPANCY 

  	
   

  	
  7

  
	
  6

  	
   

  	
  REPAIRS; ALTERATIONS;
  FIXTURES

  	
   

  	
  9

  
	
  7

  	
   

  	
  FLOOR LOAD; ODORS; NOISE

  	
   

  	
  11

  
	
  8

  	
   

  	
  LAWS,
  ORDINANCES, REQUIREMENTS OF PUBLIC AUTHORITIES

  	
   

  	
  12

  
	
  9

  	
   

  	
  USE

  	
   

  	
  12

  
	
  10

  	
   

  	
  INSURANCE

  	
   

  	
  14

  
	
  11

  	
   

  	
  DAMAGE BY FIRE OR OTHER
  CAUSE

  	
   

  	
  15

  
	
  12

  	
   

  	
  ASSIGNMENT,
  SUBLETTING, MORTGAGING

  	
   

  	
  16

  
	
  13

  	
   

  	
  NO LIABILITY ON LANDLORD’S PART

  	
   

  	
  20

  
	
  14

  	
   

  	
  INTENTIONALLY OMITTED

  	
   

  	
  21

  
	
  15

  	
   

  	
  CONDEMNATION

  	
   

  	
  21

  
	
  16

  	
   

  	
  ENTRY,
  RIGHT TO CHANGE PUBLIC PORTIONS OF THE BUILDING

  	
   

  	
  22

  
	
  17

  	
   

  	
  BANKRUPTCY

  	
   

  	
  23

  
	
  18

  	
   

  	
  DEFAULTS,
  REMEDIES AND WAIVER OF REDEMPTION 

  	
   

  	
  28

  
	
  19

  	
   

  	
  LANDLORD’S
  RIGHT TO PERFORM TENANT’S OBLIGATIONS, REIMBURSEMENT TO LANDLORD, ADDITIONAL
  RENT AND PAYMENT THEREOF - LATE CHARGE

  	
   

  	
  31

  
	
  20

  	
   

  	
  COVENANT OF QUIET ENJOYMENT

  	
   

  	
  31

  
	
  21

  	
   

  	
  EXCAVATION

  	
   

  	
  32

  
	
  22

  	
   

  	
  SERVICES AND EQUIPMENT

  	
   

  	
  32

  
	
  23

  	
   

  	
  ELECTRICITY

  	
   

  	
  34

  
	
  24

  	
   

  	
  BROKER

  	
   

  	
  36

  
	
  25

  	
   

  	
  SUBORDINATION

  	
   

  	
  37

  
	
  26

  	
   

  	
  LEGAL PROCEEDINGS

  	
   

  	
  38

  
	
  27

  	
   

  	
  SURRENDER OF PREMISES

  	
   

  	
  39

  
	
  28

  	
   

  	
  RULES AND REGULATIONS

  	
   

  	
  39

  
	
  29

  	
   

  	
  SUCCESSORS AND ASSIGNS

  	
   

  	
  40

  
	
  30

  	
   

  	
  NOTICES

  	
   

  	
  40

  
	
  31

  	
   

  	
  NO WAIVER: ENTIRE AGREEMENT

  	
   

  	
  41

  
	
  32

  	
   

  	
  INDEX AND
  CAPTIONS: ESTOPPEL CERTIFICATE

  	
   

  	
  41

  
	
  33

  	
   

  	
  INABILITY TO PERFORM

  	
   

  	
  42

  
	
  34

  	
   

  	
  NO REPRESENTATIONS BY LANDLORD

  	
   

  	
  42

  
	
  35

  	
   

  	
  CONSENTS, JUDICIAL
  DETERMINATION

  	
   

  	
  42

  
	
  36

  	
   

  	
  SECURITY

  	
   

  	
  43

  
	
  37

  	
   

  	
  MISCELLANEOUS
  

  	
   

  	
  45

  
	
  38

  	
   

  	
  ENVIRONMENTAL

  	
   

  	
  45

  
	
  39

  	
   

  	
  SUITES 1601 AND 1611

  	
   

  	
  46

  
	
  40

  	
   

  	
  RELOCATION

  	
   

  	
  48

  
	
  EXHIBIT A:

  	
  CONDITION
  OF THE DEMISED PREMISES ON THE COMMENCEMENT DATE

  	
   

  	
   

  
	
  EXHIBIT B:

  	
  CLEANING
  STANDARDS

  	
   

  	
   

  
	
  EXHIBIT C:

  	
  RULES AND
  REGULATIONS

  	
   

  	
   

  
	
  EXHIBIT D:

  	
  DEMISED
  PREMISES

  	
   

  	
   

  
	
  EXHIBIT E:

  	
  STATEMENT
  SPECIFYING COMMENCEMENT DATE

  	
   

  	
   

  
						

 

 

LEASE

 

Lease dated as of April,
1995, between 366 Madison, Inc., a New York corporation, with offices at c/o
The Galbreath Company, L.P., 437 Madison Avenue, New York, New York 10022
(hereinafter called “Landlord”) and Silipos, Inc., a New York corporation, with
offices at 366 Madison Avenue, 16th Floor, New York, New York 10017
(hereinafter called “Tenant”).

 

WHEREAS, Tenant desires that
a Lease be made to it of such spaces in Building (as defined in Article 2)
for the term, for the rent and upon and subject to the covenants, agreements,
terms, conditions, limitations, exceptions and reservations herein contained;

 

NOW, THEREFORE, Landlord and
Tenant hereby covenant and agree as follows:

 

ARTICLE 1 

 

DEMISE - PREMISES -TERMS

 

1.01.                                               Landlord hereby demises and leases to Tenant,
and Tenant hereby takes and hires from Landlord, that portion of the Building
more particularly described in Exhibit D hereto (hereinafter called “the
Demised Premises”) for the term hereinafter stated, for the rent hereinafter
reserved and upon and subject to the covenants, agreements, terms, conditions,
limitations, exceptions and reservations of this Lease.

 

l.02.                                               The
term of this Lease and the estate hereby granted (hereinafter collectively
called the “term of this Lease”), shall commence on the Effective Date of this
Lease which shall be deemed to be the date this Lease is fully executed and
delivered by both parties, which
date of commencing is hereinafter called the “Commencement Date”, and shall end
at noon on June 30, 2000, which ending date is hereinafter called the
“Expiration Date”, or shall end on such earlier date upon which said term may
expire or be terminated pursuant to any of the conditions of limitation or
other provisions of this Lease or pursuant to law.  The term “Lease Year” shall mean every
successive period of twelve (12) calendar months commencing on the Commencement
Date.

 

1.03.                                               Landlord shall in accordance with the
foregoing fix the Commencement Date and shall notify Tenant of the date so
fixed.  When the Commencement Date has
been so determined, the parties shall at Landlord’s request execute a written
agreement confirming such date is the
Commencement Date as attached hereto as Exhibit E.  Any failure of the parties to execute such
written agreement shall not affect the validity of the Commencement Date as
fixed and determined by Landlord.

 

ARTICLE 2 

 

DEFINITIONS

 

2.01.                For all purposes of this Lease, and all
agreements supplemental hereto, the terms defined in this Section shall
have the meanings specified in this Section unless the context otherwise
requires:

 

(a)   “Building” shall mean that certain
building, known by street address as 366 Madison Avenue, New York, N.Y., which
is located upon the Land, together with the columns,

 

 

footings,
supports, foundations and other structural members supporting said building,
together with all improvements now or hereafter located therein, and all
systems, fixtures and other items of property attached or appurtenant to the
improvements or used or necessary in the operation thereof;

 

(b)   “ERIF” (as defined in Article 23) shall
mean $8,745.00;

 

(c)   “include” and “including” shall
each be construed as if followed
by the phrase “without being limited to”;

 

(d)   “Land” shall mean all that certain
lot, piece or parcel of land, situate, lying and being in the Borough of

Manhattan, City, County and State of New York, located underneath the Building;

 

(e)   “laws and requirements of public authorities”,
and words of like import, shall mean laws and ordinances of any or all of the
federal, state, city, county and borough governments and rules, regulations,
orders and directives of any or all departments, subdivisions, bureaus,
agencies or offices thereof, or of any other governmental, public or
quasi-public authorities, having jurisdiction of the Land or Building, and the
direction of any public officer pursuant to law;

 

(f)    “mortgage” shall include an indenture
of mortgage, a deed of trust to
a trustee, a pledge or any other instrument creating a lien on or other
security interest in the property in question, and the term “mortgagee”
shall include any such trustee and any other holder of rights under a mortgage;

 

(g)   The “obligations” of this Lease, and
words of like import, shall mean the covenants to pay rent and additional rent
under this Lease and all of the other covenants, agreements, terms, conditions,
limitations, exceptions and reservations contained in this Lease;

 

(h)   “Operating Hours” shall mean the hours
between 8:00 AM and 6:00 PM on such Mondays, Tuesdays, Wednesdays, Thursdays
and Fridays as do not fall on the days celebrated as New Year’s Day, Presidents’
Day, Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day,
Thanksgiving Day or Christmas or on such other days as are celebrated as
holidays under the contract between Local 32B-32J of the Building Service
Employees Union AFL-CIO and the Real Estate Advisory Board of New York, Inc.;

 

(i)    “Project” shall mean the Land and the Building;

 

(j)    “related corporation” shall mean a corporation,
individual, partnership, or other business entity, which, directly or
indirectly, controls, is controlled by, or is under common control with,
another corporation, individual, partnership, or other business entity;

 

(k)   “repair” and “repairs” shall be
deemed to include restoration, replacement and rebuilding;

 

(l)    “requirements of insurance bodies”, and words of like import,
shall mean rules, regulation, orders and other requirements of the New York
Board of Fire Underwriters or the New York Fire Insurance Rating Organization
or any other similar body performing the same or similar functions and having

 

2

 

jurisdiction or cognizance of the Land, Building or
Demised Premises;

 

(m)  “successor corporation” shall mean a corporation or other
business entity into or with which another corporation or other business entity
shall be merged or consolidated or to which all or substantially all of the
assets of such other corporation or other business entity shall be transferred;
and

 

(n)   “Tenant’s obligations hereunder”, and
words of like import, and “Landlord’s obligations hereunder”, and words
of like import, shall mean the obligations of this Lease which are to be
performed, observed, or kept by Tenant, or by Landlord, as the case may
be.  Reference to “performance” of
either party’s obligations under this Lease shall be construed as “performance,
observance and keeping”.

 

2.02.                The following additional terms, wherever used
in this Lease (unless the context requires otherwise), shall have the
respective meanings specified in the Sections of this Lease set forth below
after such terms:

 

	
  “rent”

  	
   

  	
  Section 3.01

  	
   

  
	
  “Rent Commencement Date”

  	
   

  	
  3.01

  	
   

  
	
  “fixed rent”

  	
   

  	
  3.01

  	
   

  
	
  “Taxes”

  	
   

  	
  4.01

  	
  (a)

  
	
  “Base Year for Taxes”

  	
   

  	
   

  	
  (b)

  
	
  “Base Tax”

  	
   

  	
   

  	
  (c)

  
	
  “Subsequent Tax Year”

  	
   

  	
   

  	
  (d)

  
	
  “Tenant’s Proportionate Share”

  	
   

  	
   

  	
  (e)

  
	
  “Operation Year”

  	
   

  	
   

  	
  (f)

  
	
  “Base Labor Rate”

  	
   

  	
   

  	
  (g)

  
	
  “Labor Rate”

  	
   

  	
   

  	
  (h)

  
	
  “Labor Factor”

  	
   

  	
   

  	
  (i)

  
	
  “Escalation Statement”

  	
   

  	
   

  	
  (j)

  
	
  “Payment Dates”

  	
   

  	
  4.02

  	
   

  
	
  “Landlord’s and Tenant’s Work”

  	
   

  	
  5.01

  	
   

  
	
  “Tenant’s Plans”

  	
   

  	
  5.04

  	
   

  
	
  “Lien”

  	
   

  	
  5.07

  	
   

  
	
  “Permitted Alterations”

  	
   

  	
  6.04

  	
   

  
	
  “Tenant’s Change”

  	
   

  	
  6.04

  	
   

  
	
  “Offer Notice”

  	
   

  	
  12.02

  	
   

  
	
  “Sublease Profit”

  	
   

  	
  12.06

  	
   

  
	
  “Rules and Regulations”

  	
   

  	
  28.02

  	
   

  
	
  “Landlord”

  	
   

  	
  29.02

  	
   

  
	
  “Consent”

  	
   

  	
  35.01

  	
   

  
	
  “Judicial Determination”

  	
   

  	
  35.01

  	
   

  
	
  “Demisable Area”

  	
   

  	
  Exhibit D

  	
   

  

 

2.03.                The Article headings in this Lease and
the Index annexed to this Lease are inserted only as a matter of convenience,
and are not to be given any effect whatsoever in construing this Lease.  All references in this Lease to number “Articles”,
numbered “Sections” and lettered “Exhibits” are references to Articles and
Sections of this Lease, and Exhibits annexed to (and thereby made part of) this
Lease, as the case may be, unless expressly otherwise designated in the
context.

 

ARTICLE 3

 

RENT

 

3.01.               Subject to Section 5.02, the rent
reserved under this Lease (hereafter called the “rent”), for the term hereof,
shall, with respect to that
portion of the Demised Premises known as Suite 1616, commence on May 1, 1995
and with

 

3

 

respect to the balance of the Demised Premises
commence 60 days after “substantial completion” of that part of Tenant’s Work
for which Tenant is receiving Landlord’s Contribution, as so marked on Exhibit
A.  “Substantial completion” shall be
certified to by Tenant’s contractor, but in all events rent as to the balance
of the Demised Premises shall commence 120 days from the Commencement
Date.  The aforesaid dates are
hereinafter collectively called the “Rent Commencement Date” and rent shall be
and shall consist of:

 

(a)      an annual fixed rent (hereinafter called the “fixed
rent”) at the rate of

 

	
  Year

  	
   

  	
  Per Annum

  	
   

  	
  Per Month

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1-2

  	
   

  	
  $

  	
  81,885.00

  	
   

  	
  $

  	
  6,823.75

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3-to the end of the Lease Term

  	
   

  	
  $

  	
  85,065.00

  	
   

  	
  $

  	
  7,088.75

  	
   

  

 

which fixed rent shall be
payable in equal monthly installments in advance on the first day of each and
every calendar month of the term of this Lease (except as stated below);
commencing on the Rent Commencement Date and each and every month thereafter;
plus

 

(b)     such other sums of money as shall become due
and payable as additional rent hereunder, which additional rent shall be
payable as hereinafter provided, all to be paid to Landlord, at its principal
place of business as specified on the first page of this Lease, or such other
place in the City of New York as Landlord may designate, in lawful money of the
United States of America, subject, however, to increase, decrease or abatement
as expressly provided in this Lease.

 

3.02.             Tenant
has, simultaneously with execution and delivery of this Lease, paid to Landlord
an amount equal to the base fixed rent for one month. If the Rent Commencement
Date is other than the first day of a calendar month, the first monthly installment
of fixed rent, prorated to the end of said calendar month, shall be payable on
the Rent Commencement Date and the payment made by Tenant upon execution and delivery of this Lease shall
be applied to the second monthly installment of fixed rent.

 

3.03.             Tenant covenants and agrees promptly to pay the
rent and other charges herein reserved as and when the same shall become due
and payable, without notice or demand therefor and without deduction, set off
or counterclaim with respect thereto.

 

3.04.             Landlord may furnish to Tenant monthly
invoices of the fixed rent which shall be due and payable under this Lease, and
shall endeavor to give prompt notice to Tenant of all other items of additional
rent due and payable under this Lease; provided, however, that failure to furnish said invoices on a timely
basis shall not relieve Tenant of its obligations hereunder.

 

3.05.             The parties acknowledge that Tenant, for the
months of February, March and April 1995, has occupied a portion of
the Demised Premises, to wit: Suite 1616 and has heretofore paid to Landlord
the sum of $8,238,99 as and for use and occupancy therefor.

 

4

 

ARTICLE 4 

 

ADJUSTMENT
OF RENT FOR CHANGES

IN
REAL ESTATE TAXES AND WAGE RATES

 

4.01.             As used herein:

 

(a)      “Taxes” shall mean all real estate
taxes and assessments levied, assessed, confirmed, imposed, or which become a
lien against the Project, but such term shall not include any income,
franchise, transfer, inheritance, capital stock or other tax unless, due to a
future change in the method of taxation, an income, franchise, transfer,
inheritance, capital stock or other tax shall be levied against Landlord in
substitution for, or in lieu of, or in addition to, any tax which would
otherwise constitute a Tax, in which event such income, franchise, transfer,
inheritance, capital stock or other tax (whether or not directly levied,
assessed, confirmed, imposed, or which became a lien, against the project)
shall be deemed to be included in the term “Taxes”;

 

(b)     “Base Year for Taxes” shall mean the
calendar year commencing January 1, 1995;

 

(c)      “Base
Tax” shall mean the Taxes payable for the Base Year for Taxes as finally
determined if contested,

consisting of the taxes payable for the 1995/96 fiscal tax year of The City of
New York;

 

(d)     “Subsequent Tax Year” shall mean a
fiscal year for Taxes which shall commence after the termination of the Base
Year for Taxes;

 

(e)      “Tenant’s Proportionate Share” shall
mean 3.33%;

 

(f)      “Operation Year” shall mean any period
of twelve months, commencing on January 1, any portion of which occurs
during the term of this Lease;

 

(g)     “Base Labor Rate” shall mean the Labor
Rate in effect on January 1, 1995;

 

(h)     “Labor Rate” shall mean (a) the
minimum regular hourly wage rate, prescribed for Porters (as hereinafter
defined) of office buildings in the same category as the Building, pursuant to
any agreement between the Realty Advisory Board on Labor Relations,
Incorporated (or any successor thereto) and Local 32B-32J of the Building Service
Employees International Union, AFL-CIO (or any successor thereto) covering the
wage rates for Porters in such buildings (“Agreement”), or (b) if, at any time
during the term of this Lease, regular employment of Porters occurs on days or
during hours when overtime or other premium pay rates are in effect pursuant to
the Agreement, the average hourly wage rate, for the hours in a calendar week
during which Porters are regularly employed (e.g., if, pursuant to the
Agreement, the regular weekly employment of Porters is for forty hours, at a
regular hourly wage rate of $9.00 for the first thirty hours and an overtime
hourly wage rate of $12.00 for the remaining ten hours, the regular wage rate
for the applicable period shall be the weekly wage rate of $390.00 divided by
the number of regular hours of employment, to wit, forty, or $9.75), or (c) if,
at any time during the term of this Lease, no Agreement exists, the minimum
regular hourly wage rate, actually payable to Porters by Owner or the
contractor performing cleaning services in the Building, or, if no Porters are
employed at the Building, such rate for Porters employed at office buildings
having a gross area

 

5

 

comparable to the Building. If length of service is
applicable in determining the Rate, then such determination shall be made on
the basis of a minimum of five years of service. The Rate shall not include
so-called “fringe benefits” such as, pensions, vacations, Social Security,
unemployment, and workers’ compensation insurance, withholding taxes and health
and liability insurance;

 

(i)       “Labor Factor” shall mean 3180; and

 

(j)       “Escalation Statement” shall mean a
statement in writing signed by Landlord or its agent, setting forth the amount
payable by Tenant for a specified Subsequent Tax Year or Operation Year (as the
case may be) pursuant to this Article 4.

 

4.02.               If the Taxes for any Subsequent Tax Year shall
be greater than the Base Tax, then Tenant shall pay to Landlord as additional
rent for the Demised Premises for such Tax Year an amount equal to Tenant’s
Proportionate Share of such excess. After the Taxes for a Subsequent Tax Year
have been determined, Landlord shall furnish Tenant with an Escalation
Statement, accompanied by copies of the relevant tax bills, which shall set
forth the dates on which Landlord is obligated under law to pay the Taxes in
respect of such Subsequent Tax Year (the “Payment Dates”), with the percentage
of such Taxes so payable on each such Payment Date. Tenant shall pay to
Landlord, on each Payment Date, the same percentage of Tenant’s Proportionate
Share of Taxes in excess of the Base Tax for the current Subsequent Tax Year as
the percentage of Taxes for such Subsequent Tax Year payable by Landlord on
such payment Date. In no event shall Tenant be obligated to make any payment of
Tenant’s Proportionate Share of such excess sooner than ten (10) days after
receipt by Tenant of the relevant Escalation Statement.

 

4.03.               If the Labor Rate for any Operation Year shall
be greater than the Base Labor Rate, then Tenant shall pay to Landlord as
additional rent for the Demised Premises for such Operation Year an amount
equal to the product obtained by multiplying the Labor Factor by 1.00 times the
number of cents (including any fraction of a cent) by which the Labor Rate for
such Operation Year exceeds the Base Labor Rate. Any adjustment payable by
reason of the provisions of the preceding sentence shall commence as of the
first day of the relevant Operation Year and, after Landlord shall furnish
Tenant with an Escalation Statement relating to such Operation Year, all
monthly installments of rent shall reflect one-twelfth of the annual amount of
such adjustment until a new adjustment becomes effective pursuant to the terms
of this Article 4, provided, however that if said Escalation Statement is
furnished to Tenant after the commencement of such Operation Year, there shall
be promptly paid by Tenant to Landlord or vice versa, as the case may be, an
amount equal to the portion of such adjustment allocable to the part of such
Operation Year which shall have elapsed prior to the first day of the calendar
month next succeeding the calendar month in which said Escalation Statement is
furnished to Tenant.

 

4.04.               In the event that the Commencement Date shall
occur other than on the first day of a Subsequent Tax Year or an Operation Year
or the Expiration Date shall be a day other than the last day of a subsequent
Tax Year or an Operation Year (as the case may be) the amounts payable pursuant
to Sections 4.02 and 4.03 shall be prorated.

 

4.05.               Payments shall be made pursuant to this Article 4
notwithstanding the fact that an Escalation Statement is furnished to Tenant
after the expiration of the term of this Lease.  Landlord shall, upon request by Tenant,
furnish Tenant

 

6

 

with sufficient detail
respecting the figures contained in any Escalation Statement to enable Tenant
to verify the accuracy of such figures.

 

4.06.               In case the Taxes for any Subsequent Tax Year
or part thereof shall be reduced after Tenant shall have paid Tenant’s
Proportionate Share of any excess thereof in respect of such Tax Year pursuant
to Section 4.02, Landlord shall refund to Tenant Tenant’s Proportionate
Share of such Taxes received by Landlord (after deduction of expenses,
including counsel fees, incurred by Landlord in connection with reducing the
assessed valuation and/or in obtaining such refund of Taxes).

 

ARTICLE 5

 

PREPARATION
FOR TENANT’S OCCUPANCY

 

5.01.               Landlord agrees to deliver the Demised Premises
to Tenant on the Commencement Date in its then “As Is” condition.  Notwithstanding the foregoing, Tenant shall
perform or cause to be performed all work as set forth in Exhibit A and all
other work required to prepare the Demised Premises for Tenant’s occupancy is
herein called “Tenant’s Work”. Tenant agrees (i) to accept the Demised Premises
in the condition specified in this Section 5.01; and (ii) that Landlord
shall have no obligation of any nature whatsoever with respect to preparation
of the Demised Premises for Tenant’s occupancy, except for the payment of “Landlord’s
Contribution” as such term is defined in Exhibit A.

 

5.02.               Delivery of possession of the Demised Premises
to the Tenant shall be deemed to be the Commencement Date hereof.  If Landlord is unable to deliver possession
of the Demised Premises to Tenant on the Commencement Date in the condition
specified herein for any reason, Landlord shall have no liability to Tenant by
reason thereof, nor Shall this Lease be affected thereby.

 

5.03.               Except as otherwise provided in Exhibit A, all
Landlord’s Work is to be done at the expense of Landlord and all Tenant’s Work
is to be done at the expense of Tenant. Any items to be installed in the
Demised Premises by Tenant are to be in accordance with plans and
specifications prepared by architects, in conjunction with Building engineers.
All architectural and engineering work necessary for the preparation of Tenant’s
plans shall be performed at the expense of Landlord.

 

5.04.               All Tenant’s Work required by Tenant’s Plans shall
be such that it can be performed with the least possible disturbance to the
other tenants and occupants of the Building, and included in the expense of
performing such Tenant’s Work shall be the expense of restoring all parts of
the Building which may be affected thereby to as good order and condition as
was the case prior to the performance of such Tenant’s Work. All such Tenant’s
Work shall comply with all the covenants, agreements, terms, provisions and
conditions of this Lease.

 

5.05.               Tenant in performing Tenant’s Work shall, at its
own cost and expense, comply with all applicable laws and requirements of
public authorities and requirements of insurance bodies related to, or arising
out of performance of, such Tenant’s Work, whether ordinary or extraordinary,
structural or otherwise, foreseen or unforeseen, and will not call upon the Landlord
for any expenses connected therewith, and will reimburse Landlord for any
expenses incurred on account of failure by Tenant to comply with any laws or
requirements of public authorities or requirements of insurance bodies, whether

 

7

 

involving structural changes or not. Tenant shall
promptly pay and discharge all costs and expenses of such Tenant’s Work, and
shall not do or fail to do any act which shall or may render the Building or
any part thereof or the premises or any part thereof liable to any mechanic’s
lien or other lien or security agreement or charge or chattel mortgage or
conditional bill of sale or title retention agreement (hereinafter collectively
called “Lien”), and if any such Lien be filed against the Building or any part
thereof, or the Demised Premises or any part thereof, or against such Tenant’s
Work or any part thereof, Tenant will, at Tenant’s own cost and expense, within
thirty (30) days after the filing of any such Lien and notice of such filing to
Tenant by Landlord or otherwise, promptly take and prosecute all necessary
proceedings to cause the same to be removed of record or, in default thereof,
Landlord may cause any such Lien to be removed of record by payment or bond or
otherwise, as Landlord may elect, and Tenant will reimburse Landlord for all
reasonable costs and expenses incidental to the removal of any such Lien
incurred by Landlord. 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 any 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 matter or thing connected with any Tenant’s Work as a result of any act
or omission of Tenant or its officers, directors, employees, agents,
contractors or others acting at the direction or on behalf of Tenant. At any
and all times during the period of such Tenant’s Work, Landlord shall be
entitled to have a representative or representatives on the site to inspect
such Tenant’s Work, and such representative or representatives shall have free
and unrestricted access to any and every part of the Demised Premises.  Tenant shall deliver or cause to be delivered
to Landlord such instrument or instruments in writing as Landlord may
reasonably require or deem necessary to carry into effect the intended purpose
of this Section. Tenant shall, at Tenant’s cost and expense, cause each and
every contractor of Tenant’s selection to maintain and keep in force, for the
benefit of Landlord, until such Tenant’s Work is completed. Owner’s Protective
Liability and property damage insurance with limits of at least $1,000,000 for
injuries to any one person, $3,000,000 for injuries arising out of any one
incident, and $1,000,000 property damage, together with worker’s compensation
and employer’s liability insurance coverage as required by law and prior to
commencement of Tenant’s Work, Tenant shall furnish Landlord evidence of said
policy in form and substance reasonably satisfactory to Landlord.

 

5.06.               Landlord shall make available to Tenant during
the performance of Tenant’s Work such electrical energy Tenant may require for
temporary lighting and power and Tenant shall pay Landlord’s reasonable charges
therefor.

 

5.07.              Tenant agrees that it will not at any time prior
to or during the term of this Lease, either directly or indirectly, use any
contractors and/or labor, and/or materials if the use of such contractors
and/or labor and/or materials would or will create any labor dispute or other
disruption with other contractors and/or labor and/or materials engaged by
Tenant or Landlord or others in the construction, maintenance, and/or operation
of the Building or any part thereof.

 

8

 

ARTICLE 6

 

REPAIRS; ALTERATIONS;
FIXTURES

 

6.01.               Landlord, at its expense, shall keep and
maintain the Building, and its fixtures, appurtenances, systems and facilities,
and the sidewalks and plazas adjoining the Building, in good working order,
condition and repair and shall make all repairs, structural and otherwise,
interior and exterior, as and when needed in or about the Demised Premises,
except for those repairs for which Tenant is expressly responsible pursuant to
any other provisions of this Lease. Notwithstanding the foregoing, Landlord
shall have no obligation to make repairs in the Demised Premises to any floors,
hardware, electrical switches, electrical or telephone outlets or lighting
fixtures required as a result of wear and tear, nor shall Landlord be required
to make any repairs to (i) any item of Tenant’s Work, or (ii) any Tenant’s
Change.

 

6.02.               Tenant shall take good care of the Demised Premises,
the fixtures, equipment and appurtenances therein, and Tenant shall, at Tenant’s
own expense, make all repairs to the Demised Premises and its fixtures,
appurtenances and equipment (other than those occasioned by ordinary wear and
tear) which are not required to be made by Landlord pursuant to Section 6.01
and shall be responsible for the cost of all repairs to the Demised Premises
and the Building when necessitated toy Tenant’s moving property in or out of
the Building or by installation or removal of furniture, fixtures or other
property, or necessitated by the carelessness, omission, misuse, neglect or
improper conduct of Tenant, its servants, employees, agents, visitors or
licensees. All of said repairs and any restorations or replacements required in
connection therewith shall be of quality and class at least equal to the
original work or installations and shall be done in a good and workmanlike
manner to the reasonable satisfaction of Landlord.

 

6.03.               Tenant shall not store or place any materials of
whatsoever kind or nature or any obstructions in the lobby, passageways,
stairs, on the sidewalks or plaza abutting the Building or in any public
portions of the Building.

 

6.04.               (a) 
Except for “Permitted Alterations” (as defined below), after the
performance of Tenant’s Work Tenant shall make no further alterations,
installations, additions or improvements in or to the Demised Premises or any
alteration to the structural, electrical, plumbing or HVAC systems of the Building
or any part thereof or to other Building apparatus of other or like nature,
without Landlord’s prior written consent and then only by contractors or
mechanics approved in writing by Landlord, such consent and approval not to be
unreasonably withheld or delayed. (Any alteration, installation, addition or improvement
added in or to the Demised Premises or a Building mechanical system after the
performance of Tenant’s Work, whether a Permitted Alteration or not, made by
Tenant is hereinafter called a “Tenant’s Change”.) Landlord may condition
Landlord’s approval with respect to any Tenant’s Change of the kind described
in the last sentence of Section 5.05 on Tenant’s agreement to remove such
Tenant’s Change and restore the portions of the Demised Premises affected
thereby to its condition prior to the making of such Tenant’s Change. The
following shall be deemed to be “Permitted Alterations” and shall not require Landlord’s
prior written consent:

 

(i)                Erection, demolition or alteration of non-load
bearing partitions and hung ceilings;

 

9

 

(ii)               Alterations or additions to
the electrical system in the Demised Premises provided that the aggregate load
carried by such system is not thereby increased and, also, that no portion of
the Building outside of the Demised Premises is thereby affected; and

 

(iii)              Alterations in the air-conditioning duct work
serving the interior of the Demised Premises provided that no portion of the
Building outside of the Demised Premises is thereby affected.

 

(b)   Tenant’s Changes shall be done at Tenant’s sole
expense and at such times and in such manner as Landlord may from time to time
reasonably designate and in full compliance with all laws and requirements of
governmental authorities and requirements of insurance bodies. All Tenant’s
Changes (except to the extent altered or removed in connection with a
subsequent Tenant’s Change) shall become the property of Landlord and shall
remain upon and be surrendered with the Demised Premises as a part thereof at
the end of the term or renewal term, or prior expiration thereof, as the case
may be. Prior to commencing any Tenant’s Change, Tenant shall submit to
Landlord for Landlord’s information and/or consent, if required hereunder, a
plan or plans showing the proposed Tenant’s Change. Promptly following
completion of such Tenant’s Change, Tenant shall furnish Landlord with an “As-Built”
plan showing such Tenant’s Change; provided however, that to the extent such
Tenant’s Change constitutes Permitted Alterations or other work of a merely
cosmetic, non-structural nature, Tenant shall be permitted to furnish to
Landlord final construction drawings with field annotations thereon in lieu of
said “As-Built” plans.

 

(c)   Anything to the contrary in this Lease notwithstanding,
Tenant shall be responsible for all repairs and maintenance of any kind or
nature to the Building, its systems and the Demised Premises required by any
Tenant’s Change. If any mechanic’s lien is filed against the Demised Premises
or the Building for work claimed to have been done for, or materials claimed to
have been furnished to, Tenant, it shall be discharged by Tenant within thirty
(30) days thereafter, at Tenant’s expense, by filing the bond required by law
or payment or otherwise. Landlord shall not be liable for any failure of any
Building facilities or services including but not limited to the
air-conditioning and ventilating equipment in the Demised Premises installed by
Landlord caused by Tenant’s Changes and Tenant shall correct any such faulty
installation. Upon Tenant’s failure to correct same, Landlord may make such
correction and charge Tenant for the cost thereof. Such sum due Landlord shall
be deemed additional rent and shall be paid by Tenant promptly upon being
billed therefor. Tenant shall keep full and accurate records of the cost of any
Tenant’s Changes in and to the Demised Premises made by Tenant and shall, if
requested by Landlord, make the same available to Landlord for use in
connection with any proceeding to review the assessed valuation of the Building
or any proceedings to acquire the Land and Building for public or quasi-public
use.

 

(d)   Any of Tenant’s personal property, which shall
remain in the Demised Premises following the expiration of the term, or any
earlier termination of this Lease, and the removal of Tenant from the Demised
Premises may, at the option of the Landlord be deemed to have been abandoned
and either may be retained by Landlord as its property or be disposed of at
Tenant’s expense or at Landlord’s option may be disposed of without accountability
in such manner as Landlord may see fit. In the event of Tenant’s failure to remove any of such property, if
Landlord shall cause such property to be removed then any

 

10

 

damage caused by the removal
thereof and any other damage to the Demised Premises caused by the removal of
such property from the Demised Premises may be repaired at Tenant’s cost and
expense and Tenant shall pay to Landlord upon demand all such costs and
expenses.

 

(e)   The provisions of this Section 6.04 shall
survive the expiration or termination of this Lease.

 

6.05.                    Prior to commencing any Tenant’s Change pursuant to the provisions of Section 6.04, Tenant shall furnish
to Landlord:

 

(i)             Copies of all governmental permits and authorizations
which may be required in connection with such work.  The parties acknowledge that no permits are
required for the work required under Exhibit A.

 

(ii)            A Certificate evidencing that Tenant (or
Tenant’s contractors) has (have) procured worker’s compensation insurance
covering all persons employed in connection with the work who might assert
claims for death or bodily injury against Landlord, Tenant or the Building and

 

(iii)           Such additional personal injury and property
damage insurance (over and above the insurance required to be carried by Tenant
pursuant to the provisions of Section 9.03) as Landlord may reasonably
require because of the nature of the work to be done by Tenant.

 

ARTICLE 7

 

FLOOR LOAD; ODORS; NOISE

 

7.01.                    Tenant shall not place a load upon any floor
of the Demised Premises which exceeds the load per square foot which such floor
is designed to carry and which is then allowed by law. All business machines
and equipment and all other mechanical equipment installed and used by Tenant in
the Demised Premises shall be properly shielded and be so placed, equipped,
installed and maintained by Tenant at Tenant’s own cost and expense in settings
of cork, rubber or spring-type vibration-eliminators or in such other manner as
Landlord may reasonably direct so as to be sufficient to eliminate the
transmission of noise, vibration or electrical or other interference from the
Demised Premises to any other area of the Building. Tenant shall not permit any
odors created in the Demised Premises to seep into any other part of the
Building.

 

7.02.                    Tenant shall not move any safe, heavy
equipment or bulky matter in or out of the Building without Landlord’s written
consent, which consent Landlord agrees not unreasonably to withhold or delay.
If the movement of such items requires special handling, Tenant agrees to
employ only persons holding a Master Rigger’s License to do said work, and all
such work shall be done in full compliance with all applicable laws and
requirements of public authorities. All such movements shall be made during
hours which will not interfere with the normal operations of the Building, and
all damage caused by such movement shall be promptly repaired at Tenant’s
expense.

 

11

 

ARTICLE 8

 

LAWS,
ORDINANCES, REQUIREMENTS 

OF PUBLIC AUTHORITIES

 

8.01.               Landlord covenants and agrees that, at the
Commencement Date, (i) the Certificate of Occupancy issued for the Building
will permit the activities specified in Section 9.01 to be conducted in
the respective portions of the Demised Premises designed, finished and equipped
for such activity, and (ii) there shall be no violations which will interfere
with Tenant’s use and occupancy of the Demised Premises or prohibit performance
of Landlord’s Work or Tenant’s Work.

 

8.02.               Tenant shall, at its expense, comply with all
laws and requirements of public authorities, and requirements of insurance
bodies which shall, with respect to the Demised Premises or the occupancy, use
or manner of use of the Demised Premises or to any abatement of nuisance caused
by Tenant, impose any violation, order or duty upon Landlord or Tenant arising
from Tenant’s particular use or manner of use of the Demised Premises or any
installations made therein by or at Tenant’s request or required by reason of a
breach of any of Tenant’s covenants or agreements hereunder. Landlord shall, at
its expense, rectify or contest by appropriate proceedings all laws and
requirements of public authorities and requirements of insurance bodies applicable
to the Building or the Demised Premises which are not the responsibility of
Tenant pursuant to the foregoing sentence.

 

8.03.               If Tenant receives notice of any violation of any
law or requirement of public authority or requirement of insurance bodies applicable
to the Demised Premises, it shall give prompt notice thereof to Landlord.
Tenant may, at its expense, contest the validity of any such law or requirement
of public authority or requirement of insurance bodies and may defer compliance
therewith provided that (i) Landlord is not thereby subjected to criminal
prosecution and (ii) no unsafe or hazardous condition remains unremedied.
Tenant hereby agrees to indemnify and save Landlord harmless against any loss
or liability arising out of any such deferral of compliance. Landlord agrees to
execute any document reasonably required by Tenant in order to permit Tenant to
effectively carry on any such contest.

 

8.04.               Tenant will not clean, nor require, permit, suffer
or allow any window in the Demised Premises to be cleaned, from the outside in
violation of Section 202 of the Labor Law or of the rules of the Board of
Standards and Appeals or of any other board or body having or asserting
jurisdiction.

 

ARTICLE 9

 

USE

 

9.01.               Except as otherwise provided under Section 12.07,
Tenant shall use and occupy the Demised Premises for its executive and general
offices only, and for no other purpose.

 

9.02.               Tenant may, in addition to using the Demised Premises
for the purposes permitted by Section 9.01, also use portions of the
Demised Premises for the installation, maintenance and operation in the Demised
Premises of (i) electronic data processing equipment and business machines, and
(ii) duplicating equipment, and (iii) “Dwyer” kitchen unit, in each case used
for purposes incidental to the business of Tenant.

 

9.03.               Tenant shall not suffer or permit the Demised Premises
or any part thereof to be used in any manner, or

 

12

 

anything to be done therein, or suffer or permit anything
to be brought into or kept in the Demised Premises which would in any way (i) violate any law or requirement
of public authorities or requirement of insurance bodies, (ii) cause structural
injury to the Building or any part thereof, (iii) interfere with the normal
operation of the heating, air-conditioning, ventilating, plumbing or other
mechanical or electrical systems of the Building or the elevators installed
therein, (iv) constitute a public or private nuisance, (v) alter the appearance
of the exterior of the Building or (vi) affect in any adverse way any portion
of the interior of the Building other than the Demised Premises.

 

9.04.               The use of the Demised Premises for the
purposes specified in Section 9.01 shall not in any event be deemed to
include, and Tenant shall not use, or permit the use of, the Demised Premises
or any part thereof for

 

(a)     sale at retail of any products or materials;

 

(b)     the conduct of a public auction of any kind;

 

(c)     the conduct of a bank, trust company, savings
bank, safe deposit, savings and loan association or bank or any branches of any
of the foregoing or a loan company business (except for the conduct of a credit union or benefit plan for Tenant’s
employees);

 

(d)     the issuance and sale of traveler’s checks, foreign
drafts, letters of credit, foreign exchange or domestic

money orders or the receipt of money for transmission;

 

(e)     an employment agency;

 

(f)      product display activities, such as those of
a manufacturer’s representative;

 

(g)     offices or agencies of a foreign government
or political subdivisions thereof;

 

(h)     offices of any governmental bureau or agency
of the United States or any state or political subdivision thereof;

 

(i)      offices of any public utility company, other
than corporate, executive or legal staff offices;

 

(j)      data processing services rendered primarily
to others than Tenant and which are not strictly ancillary to Tenant’s
business;

 

(k)     health care professionals;

 

(l)      schools or other training or educational uses
(other than those which are strictly ancillary to the Tenant’s business, such
as training of Tenant’s personnel to be employed in the Building);

 

(m)    clerical support concerns rendering clerical support
services primarily to others than Tenant or performing functions other than
those which are strictly ancillary to Tenant’s business;

 

(n)    reservation centers for airlines or for travel agencies;

 

(o)    broadcasting centers for communications
firms, such as radio and television stations; and

 

13

 

(p)    any other use or purpose which, in the reasonable
judgment of Landlord, is not in keeping with the character and dignity of the
Building.

 

ARTICLE 10

 

INSURANCE

 

10.01.             Tenant shall not commit or permit any violation
of the policies of fire, boiler, sprinkler, water damage or other insurance
covering the Building and/or the fixtures, equipment and property therein
carried by Landlord, or do or permit anything to be done, or keep or permit anything to be kept, in the Demised Premises, which
in case of any of the foregoing, (i) would result in termination of any such
policies, (ii) would adversely affect Landlord’s right of recovery under any of
such policies or (iii) would result in reputable and independent insurance
companies refusing to insure the Building or the property of Landlord, in
amounts reasonably satisfactory to Landlord.

 

10.02.             (a)  If,
because of anything done, caused or permitted to be done or omitted by Tenant,
the rate of liability, fire, boiler, sprinkler, water damages or other insurance
(with all extended coverage) on the Building or on the property and equipment
of Landlord or any other tenant in the Building shall be higher than it
otherwise would be, Tenant shall reimburse Landlord and the other tenants in
the Building for the additional insurance premiums thereafter paid by Landlord
or by the other tenants in the Building which shall have been charged because of the
aforesaid reasons. Tenant shall make the reimbursement on the first day of the
month following such payment by Landlord or such other tenants or subtenants,
upon production of a receipted premium invoice and other evidence required
hereunder.

 

(b)   If, because of anything done, caused or permitted
to be done or omitted by Landlord, not the responsibility of Tenant pursuant to
Section 10.01 at subsection (a) of this Section, the rate of any
insurance coverage carried by Tenant as required by this Lease shall be higher
than it otherwise would be, Landlord shall reimburse Tenant for the additional
premium for such insurance thereafter paid by Tenant which shall have been
charged because of the aforesaid reason. Landlord shall make such reimbursement
not later than the first day of the month following such payment by Tenant,
upon production of a receipted premium invoice and other evidence required
hereunder.

 

(c)   In any action or proceeding wherein Landlord and
Tenant are parties, a schedule or “make up” of insurance rate for the
Building or Demised Premises issued by the New York Fire Insurance Exchange, or
other body establishing fire insurance rates for said Building, shall be
conclusive evidence of the facts therein stated and of the several items and
charges in the insurance rates then applicable to the Building or Demised
Premises.

 

10.03.             Tenant at Tenant’s own cost and expense shall
maintain insurance protecting and indemnifying Landlord, and Landlord’s agents, employees and contractors
against any and all claims for injury or damage to persons or property or for
the loss of life or of property occurring upon, in or about the Demised
Premises or the public portions of the Building as a result of any act, neglect
or omission of Tenant, its employees, agents,
contractors, customers and invitees; such insurance to afford minimum
protection during the terms of this Lease, of not less than $2,000,000 in
respect of bodily injury or death to any

 

14

 

one person or in respect of any one occurrence or
accident, and not less than $500,000 for property damage.

 

All such insurance shall be effected under valid and enforceable
policies (which may cover the Demised Premises and other locations); shall be
issued by insurers of recognized responsibility reasonably acceptable to
Landlord; and shall contain a provision whereby the insurer agrees not to
cancel the insurance without ten (10) days’ prior written notice to Landlord.
On or before the date when Tenant shall first enter the Demised Premises
pursuant to Article 5, Tenant shall furnish Landlord with a certificate
evidencing the aforesaid insurance coverage, and renewal certificates shall be
furnished to Landlord at least thirty (30) days prior to the expiration date of
each policy for which a certificate was theretofore furnished.

 

10.04.             Tenant and Landlord shall secure an
appropriate clause in, or an endorsement upon, each of their respective
insurance policies covering or applicable, in the case of Tenant to the Demised
Premises and the personal property, fixtures and equipment, located therein or
thereon and, in the case of Landlord to the Building or such portions thereof
as shall then be owned by Landlord, pursuant to which Landlord’ s and Tenant’s
respective insurance companies waive subrogation or permit the insured, prior
to any loss, to agree with a third party to waive any claim it might have
against said third party without invalidating the coverage under said insurance
policy.  The waiver of subrogation or
permission for waiver of any claim obtained by Tenant shall extend to Landlord
and its agents and employees and each mortgagee of Landlord, and the waiver of
subrogation or provision for waiver of any claim obtained by Landlord shall
extend to Tenant and its agents and employees.

 

10.05.             Anything to the contrary contained in this
Lease notwithstanding, the parties hereto mutually agree that neither party
shall be liable to the other party for loss or damage to the Building, the
Demised Premises or any property therein to the extent that the cost of
repairing such loss or damage is reimbursable to such party out of insurance proceeds,
or if either party is a self -insurer, to the extent that the cost of,
repairing such loss or damage would have been reimbursable to such party had
such party carried policies of fire and extended coverage insurance in the form
and amount customary at that time in the Borough of Manhattan for insurance
against loss in first class office buildings.

 

ARTICLE 11 

 

DAMAGE BY FIRE OR OTHER CAUSE

 

11.01.             If the Demised Premises shall be damaged by
fire or other cause without the fault or neglect of Tenant, Tenant’s servants,
employees, agents, visitors or licensees the damages shall be repaired by and
at the expense of Landlord (except as provided in Section 11.02) and the
rent until such repairs shall be made shall be apportioned according to the
part of the Demised Premises which is usable by Tenant. But if such partial
damage is due to the fault or neglect of Tenant, Tenant’s servants, employees,
agents, visitors or licensees, without prejudice to any other rights and
remedies of Landlord the damage shall be repaired by Landlord (except as
provided in Section 11.02) but there shall be no apportionment or
abatement of rent except to the extent of any net proceeds of rent insurance
received by Landlord.  No penalty shall
accrue for any delay which may arise by reason of adjustment of insurance on
the part of Landlord and for any delay on account of “labor troubles”, or any
other cause, similar or dissimilar, beyond Landlord’s

 

15

 

control. Tenant shall give
immediate notice to Landlord in case of fire in the Demised Premises. If the
Building is totally or substantially
damaged or rendered wholly or substantially untenantable (whether or not the
Demised Premises or any portion thereof shall be damaged) by fire or other
cause and if the Demised Premises cannot be reasonably expected to be restored
or rendered tenantable by Landlord under a normal working schedule within
a period of one (1) month after the occurrence of such damage or destruction,
either Landlord or Tenant may, within 60 days after such fire or other cause,
terminate this Lease by notice to the other party. If either Landlord or Tenant
shall give notice of termination pursuant to this Section, the term of this
Lease shall expire by lapse of time upon the date 30 days after such notice is
given and Tenant shall vacate the Demised Premises and surrender the same to
Landlord. Upon the termination of this Lease under the conditions provided for
in this Section, Tenant’s liability for rent shall cease as of the day
following the casualty. Tenant hereby expressly waives the provisions of Section 227
of the Real Property Law or any like law which may hereafter be enacted and
agrees that the foregoing provisions of this Article shall govern and
control in lieu thereof, this Article being an express agreement. If the
damage or destruction is due to the fault or neglect of Tenant the debris shall
be removed at the expense of Tenant.

 

11.02.             Landlord shall have no duty to repair or restore
any installations made by Tenant in the Demised Premises.

 

11.03.             No damages, compensation or claims shall be payable
by Landlord for inconvenience, loss of business or annoyance arising from any
repair or restoration of any portion of the Demised Premises or of the
Building. The preceding sentence shall not be construed to limit or deny any
rights in favor of Tenant against Landlord arising by operation of law without
regard to the provisions of this Lease.

 

ARTICLE 12 

 

ASSIGNMENT,
SUBLETTING, MORTGAGING

 

12.01.             Except as specifically permitted by this
Article, Tenant shall not by operation of law or otherwise, assign, mortgage or
encumber this Lease, nor sublet or permit the Demised Premises or any part
thereof to be used by others, without Landlord’s prior written consent in each
instance. An assignment or sublease, within the meaning of this Article 12,
shall be deemed to include one or more sales or transfers, direct or indirect,
by operation of law or otherwise, or creation of new stock, by which an
aggregate of more than 50% of Tenant’s or a sublessee’s stock shall be vested
in a party or parties who are non-stockholders as of the date hereof or as of
the date of subletting, as the case may be; or the transfer of the majority of
the total equity interest of the partners of any partnership tenant or
subtenant however any of the foregoing is accomplished, whether by a single
transaction or series of related or unrelated transactions. The consent by
Landlord to any assignment or subletting shall not in any manner be construed
to relieve Tenant from obtaining Landlord’s express written consent to any
other or further assignment or subletting by Tenant or by any assignee or
subtenant of Tenant, subject to and in accordance with the provisions of this Article 12.

 

12.02.             If Tenant shall determine that it desires to
sublet all or any part of the Demised Premises, Tenant shall notify Landlord of
Tenant’s desire to do so (any such notice being hereinafter called an “Offer
Notice”) specifying the space, the rent, the term for which Tenant desires to
sublet and the

 

16

 

terms and conditions on which Tenant proposes to
sublet such space. Upon receipt of an
Offer Notice, Landlord shall have the option, exercisable by Landlord in
writing within thirty (30) days after receipt of such Offer Notice, to underlet
from Tenant the space which Tenant so desires to sublet, for the term for which
Tenant desires to sublet it, for a rent equal to the lower of:

 

(i)            the rent for which Tenant proposes to sublet
such space, or

 

(ii)           the rent which Tenant by the terms of this
Lease is required to pay for the rentable area of the space so to be underlet,

 

such underlease to be upon
the covenants, agreements, terms, provisions and conditions contained in this
Lease except as hereinafter provided and except for such thereof which are
irrelevant or inapplicable and, without limiting the generality of the
foregoing, it is hereby expressly agreed that

 

(a)     Such underlease to Landlord shall give the undertenant
the unqualified and unrestricted right, without Tenant’s permission, (x) to assign such underlease or any interest
therein and/or to underlet the space covered by such underlease or any parts of
such space for any purpose or purposes that the undertenant, in the undertenant’s
discretion reasonably exercised, shall deem suitable or appropriate, except
that Landlord agrees that any such underlease will not be assigned except
simultaneously with an assignment of Landlord’s interest under this Lease so that
at all times the Landlord under this Lease and the undertenant under said
underlease shall be the same person, corporation or other entity, and each
assignor of such underlease shall thereafter be released of all obligations
under such underlease, and (y) to make any and all changes, alterations and
improvements in the space covered by such underlease deemed desirable by the
undertenant;

 

(b)   Such underlease shall provide that (x) anyassignee or subtenant of the
undertenant may, at the election of the undertenant, be permitted to make
alterations, decorations and installations in such space or any part thereof,
and (y) any such alterations, decorations and installations therein made by any
assignee or subtenant of the undertenant 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 underlease provided that such assignee or
subtenant, at its expense, shall repair the damage and injury to such space so
underlet caused by such removal;

 

(c)   Such underlease shall also provide that the parties
to such underlease expressly negate any intention that any estate created under
such underlease be merged with any other estate held by either of said parties,
but Landlord, in the event it underleases or sublets the space covered thereby,
shall nevertheless remain liable to Tenant for all rent due under such underlease.
Tenant shall have the right to set off against any rent or charges due by Tenant
under this Lease any amount owed Tenant under such underlease. Without limiting
Tenant’s right of set-off as above provided, Landlord shall have no affirmative
obligation to pay rent under such underlease at any time that Tenant is in
default in payment of amounts due Landlord under this Lease;

 

(d)   Tenant shall and will at all times at its expense
provide and permit an appropriate means of ingress and egress from such space
so underlet by Tenant to Landlord, such

 

17

 

means of ingress or egress
to be specified by Tenant in the Offer Notice with respect to such space;

 

(e)   The occupant or occupants of all or any part or
parts of such space shall, in common with Tenant, have the use of toilet
facilities and other core facilities on the floor on which such space is
located;

 

(f)    At the expiration of such underlease, Tenant
shall accept the space covered thereby in its then existing condition, provided
that Landlord shall have performed Landlord’s obligations to keep and maintain
such space in good order and condition except for ordinary wear and tear;

 

(g)   No default by Landlord under such underlease or
by anyone claiming through such underlease shall be deemed to constitute a
default under this Lease; and

 

(h)   In the case of an underlease for the balance
of the term of this Lease, this Lease shall be deemed to have been cancelled
and terminated with respect to the space covered by said underlease and the
fixed rent under this Lease and the rentable area of the Demised Premises shall
be appropriately reduced as of the effective date of such underlease.

 

In addition, if the space covered by said Offer Notice is for
substantially all of the Demised Premises, and the term of the proposed sublet
is for substantially all of the remainder of the term of this Lease, Landlord
shall have the additional option, exercisable by Landlord in writing within thirty (30) days after receipt of such Offer Notice,
to cancel this Lease effective as of the proposed effective date of such
subletting.

 

12.03.             If Landlord does not exercise either of the
options granted to Landlord by Section 12.02 with respect to a particular
space, then for a period of six (6) months
after Landlord’s rejection of the Offer Notice (whether by actual rejection or
the expiration of the thirty-day period referred to in Section 12.02),
Landlord agrees that Landlord will not unreasonably withhold or delay consent
to the subletting of such space by Tenant provided that the following further
conditions shall be met:

 

(a)   The proposed rent (including additional rent and
other allowances) payable by the proposed subtenant shall not be more
advantageous to the proposed subtenant nor shall the other terms of the
subletting be substantially different from those set forth in the Offer Notice;

 

(b)   The Demised Premises shall not, without Landlord’s
prior consent, have been listed or otherwise publicly advertised for subletting
at a rental rate less than the rental rate being demanded by Landlord for
comparable space in the Building. The foregoing, however, shall not be deemed to
prohibit Tenant from negotiating or consummating a sublease at a lower rental
rate, provided that such rental rate is not lower than the rental rate set
forth in the Offer Notice;

 

(c)   Tenant shall not then be in default hereunder
before the time herein provided, if any, to cure such default;

 

(d)   The proposed subtenant shall have a financial
standing, be of a character, be engaged in a business, and propose to use the
Demised Premises in a manner, in keeping with the standards in such respect of
the other tenancies in the Building;

 

18

 

(e)   If Landlord shall have (or will have on or about
the time of the projected commencement of the proposed sublease) suitable space
available in the Building the proposed subtenant shall not then be a tenant,
subtenant or assignee of any space in the Building, nor shall the proposed
sublessee be a person or entity with whom Landlord is then negotiating to lease
space in the Building;

 

(f)    The proposed subtenant shall not occupy and use
the Demised Premises for purposes prohibited under Section 9.04;

 

(g)   The character of the business to be conducted
or the proposed use of the Demised Premises by the proposed subtenant shall not
(i) be likely to increase Landlord’s operating expenses beyond that which would
be incurred for use by Tenant or for use in accordance with the standards of
use of other tenancies in the Building; (ii) increase the burden on existing
cleaning services or elevators over the burden prior to such proposed subletting;
or (iii) violate or be likely to violate any provisions or restrictions herein
relating to the use or occupancy of the Demised Premises;

 

(h)   Any proposed sublease shall state that it is
expressly subject to all of the obligations of Tenant under this Lease and the
further condition and restriction that the sublease shall not be assigned,
encumbered or otherwise transferred or the subleased premises further sublet by
the sublessee in whole or in part, or any part thereof suffered or permitted by
the sublessee to be used or occupied by others, without the prior written
consent of Landlord in each instance as set forth herein;

 

(i)    In no event shall there be more than two (2)
occupants (including Tenant) on any floor of the Building; and

 

(j)    Tenant shall reimburse Landlord on demand for
any reasonable costs that may be incurred by Landlord in connection with said
sublease, including, without limitation, the costs of making investigations as
to the acceptability of the proposed subtenant, and reasonable legal costs
incurred in connection with the granting of any requested consent.

 

12.04.             If this Lease shall be assigned or if the
Demised Premises or any part thereof be sublet or occupied by any person or
persons other than Tenant, Landlord may, after default by Tenant, collect rent
from the assignee, subtenant or occupant and apply the net amount collected to
the rent herein reserved, but no such assignment, subletting, occupancy or
collection of rent shall be deemed a waiver of the covenants
in this Article, nor shall it be deemed acceptance of the assignee, subtenant
or occupant as a tenant, or a release of Tenant from the full performance by
Tenant of all the terms, conditions and covenants of this Lease.

 

12.05.             Each permitted assignee or transferee shall
assume and be deemed to have assumed this Lease and shall be and remain liable jointly and severally with Tenant for the payment of fixed rent,
additional rent and adjustments of rent, and for the due performance of all the
terms, covenants, conditions and agreements herein contained on Tenant’s part
to be performed for the term of this Lease. No assignment shall be binding on
Landlord unless such assignee or Tenant shall deliver to Landlord a duplicate
original of the instrument of assignment which contains a covenant of
assumption by the assignee of all of the obligations aforesaid and shall obtain
Landlord’s prior written consent pursuant to Section 13.01.

 

19

 

12.06.             If Tenant shall sublet all or any portion of
the Demised Premises, and if the rent plus any other consideration received by
Tenant with respect to such subletting shall, as respects any portion of the
sublease term, exceed the rent payable under this Lease with respect to such
portion of the sublease term (such excess, after deduction of all reasonable
out-of-pocket expenses actually incurred in connection with the subletting,
including, without limitation, costs of alterations, brokerage commissions,
legal fees and advertising expenses, being hereinafter referred to as “Sublease
Profit”), Tenant shall pay over fifty (50%) percent of such Sublease Profit to
Landlord as additional rent under this Lease, monthly as such Sublease Profit
is received by Tenant.

 

12.07.             Notwithstanding anything in this Lease to the
contrary, Tenant may, without Landlord’s prior consent, sublet all or any
portion of the Demised Premises or assign this Lease to one or more related
corporations of Tenant or permit one or more related corporations of Tenant or
any company into which Tenant shall merge, with which Tenant shall consolidate
or which shall acquire substantially all of Tenant’s assets and business
operations, or to a corporation wholly owned by Tenant to use and/or occupy all
or any part of the Demised Premises; provided, however, that in the case of any
of the foregoing, the surviving entity which shall then constitute Tenant shall
have gross assets and net worth in amounts equal to or greater than the gross
assets and net worth of Tenant prior to said event; and provided further, that
if any related corporation of Tenant ceases, at any time, to be related to
Tenant, Tenant shall cause such corporation to vacate the Demised Premises
within 30 days. The provisions of Section 12.02 and Section 12.06
shall not apply to a sublease to a related corporation of Tenant.

 

ARTICLE 13 

 

NO LIABILITY ON LANDLORD’S
PART

 

13.01.             Landlord and its agents shall not be liable
for (a) any damage to property of Tenant or of others entrusted to employees of
the Building, nor for the loss of or damage to any property of Tenant by theft;
(b) any injury or damage to persons or property resulting from fire, explosion,
falling plaster, steam, gas, electricity, water, rain or snow or leaks from any
part of the Building or from the pipes, appliances or plumbing works or from
the roof, street or subsurface or from any other place or by dampness or by any
other cause of whatsoever nature, unless caused by or due to the negligence or
wilful acts of Landlord, its agents, servants or employees or the failure of
Landlord to perform its obligations under this Lease within a reasonable time
after notice of such failure; nor shall Landlord and its agents be liable for
any such damage caused by other tenants or persons in the Building or caused by
operations in construction of any private, public or quasi-public work; (c) any
latent defect in the Demised Premises or in the Building; or (d) any injury or
damages for which Tenant is reimbursed under its insurance policies. If at any
time any windows of the Demised Premises are temporarily or permanently closed,
darkened or bricked up as a result of causes beyond Landlord’s control,
Landlord shall not be liable for any damage Tenant may sustain thereby and
Tenant shall not be entitled to any compensation therefor nor abatement of rent
nor shall the same release Tenant from its obligations hereunder nor constitute
an eviction. Tenant shall reimburse and compensate Landlord as additional rent
within five (5) days after rendition of a statement for all expenditures made
by or damages or fines sustained or incurred by Landlord due to non-performance
or noncompliance with or breach or failure to observe any term, covenant or
condition of this Lease upon

 

20

 

Tenant’s part to be kept, observed, performed or
complied with Tenant shall give immediate notice to Landlord in case of damage
to the Demised Premises or the Building or of defects therein or in any
fixtures or equipment.

 

13.02.             Anything contained in this Lease to the
contrary notwithstanding, Tenant agrees to look solely to the estate and
property of Landlord in the Land and Building of which the Demised Premises
forms a part for the collection of any judgment (or other judicial process) in
the event of any default or breach by Landlord with respect to any of the terms
and provisions of this Lease to be observed and/or performed by Landlord,
subject, however, to the prior rights of any ground or underlying landlords or
the holder of any mortgage, and no other assets of Landlord shall be subject to
levy, execution or other judicial process for the satisfaction of Tenant’s
claim. In the event Landlord conveys or transfers its interest in the Land,
Building or in this Lease or Landlord (and in the case of any subsequent
conveyances or transfers or leases, the then grantor or Landlord or transferor)
shall be entirely released and relieved from all liability with respect to the
performance of any covenants and obligations on the part of Landlord to be
performed hereunder from and after the date of such conveyance or transfer of
Lease (but not such obligations as shall have previously accrued); it being
intended hereby that the covenants and obligations on the part of Landlord to
be performed hereunder shall be binding on Landlord, its successors and assigns
only during and in respect of
their respective periods of ownership of an interest in the Land, Building or
in this Lease.

 

ARTICLE 14 

 

INTENTIONALLY OMITTED

 

 

ARTICLE 15 

 

CONDEMNATION

 

15.01              If the whole of the Building or of the Demised
Premises shall be taken by condemnation or in any other manner for any public
or quasi-public use or purpose (other than for temporary use or occupancy), the
term of this Lease shall forthwith cease and terminate as of the date of
vesting of title by reason of such taking (which date is hereinafter referred
to as the “date of the taking”), and the rent shall be apportioned as of such
date.

 

15.02.             If a major part of the Building shall be taken
so that substantial structural alterations or reconstruction of the Building
shall be necessary as a result of such taking (whether or not the Demised
Premises be affected) Landlord may, at its option, terminate this Lease and the
term and estate hereby granted as of the date of such vesting of title by
notifying Tenant in writing of such termination within sixty (60) days
following the date of the taking.

 

15.03.             If any part, but less than all, of the Demised
Premises shall be so taken and this Lease shall not be terminated pursuant to Section 15.02,
then the part so taken shall no longer constitute part of the Demised Premises
but this Lease shall otherwise remain unaffected by such taking; provided, however,
that Tenant may elect to terminate the term of this Lease in the event of:

 

21

 

(i)            a taking of more than 25% of the total
rentable area of the Demised premises, or

 

(ii)           a taking that has a material adverse effect
on the entrance or lobbies of the Building, if Landlord fails to provide adequate
alternative access to the Building,

 

by giving notice of such
election to Landlord not later than 60 days after the date of such taking.

 

15.04.             If notice of termination of this Lease shall
be given pursuant to Section 15.03, then upon such date as may be
specified by Tenant by notice to Landlord, which date shall be not earlier than
90 and not later than 180 days after notice of such taking is given by Landlord
to Tenant, the term of this Lease shall terminate and the rent allocable to the
part of the Demised Premises so taken (determined in the same manner as is
provided in the next sentence) shall be apportioned as of the date of the
taking and the rent for the remainder of the Demised Premises shall be
apportioned as of such termination date. 
Upon a partial taking and the term of this Lease continuing in force as
to any part of the Demised Premises,

 

(a)     the fixed rent shall be diminished by an amount
equal to the area in square feet of the part or parts of the Demised Premises so
taken, multiplied by the then applicable annual per square foot rate of fixed
rent, and

 

(b)    Landlord will, at its expense, restore with reasonable
diligence the remaining portions of the Demised Premises as nearly as
practicable to the same condition as it was in prior to such condemnation or
taking.

 

15.05.             In the event of any condemnation or taking
hereinabove mentioned of all or a part of the Building (whether or not the
Demised Premises be affected) Landlord shall be entitled to receive the entire
award in the condemnation proceeding, including any award made for the value of
the estate vested by this Lease in Tenant, and Tenant hereby expressly assigns
to Landlord any and all right, title and interest of Tenant now or hereafter
arising in or to any such award or any part thereof, and Tenant shall be
entitled to receive no part of such award.

 

The foregoing, however,
shall not be deemed to preclude Tenant from recovering an award for Tenant’s
moving expenses, and Tenant’s fixtures and removable installations in the
Demised Premises.

 

ARTICLE 16 

 

ENTRY,
RIGHT TO CHANGE PUBLIC PORTIONS OF THE BUILDING

 

16.01.             Tenant shall permit Landlord to install, use
and maintain additional utility and other pipes, ducts, lines, flues and
conduits in the Demised Premises, provided that such installations
are concealed within the permanent structural walls, floors, columns and
ceilings of the Demised Premises and in the shafts provided in the Demised
Premises for such installations and do not materially damage the appearance or
reduce the floor area of the Demised Premises or affect Tenant’s layout, and
provided further that the installation work is performed at such times and in
such manner as to create the least practicable interference with Tenant’s use
of the Demised Premises; it being agreed however that the foregoing shall in no
event obligate Landlord to do such work on an “overtime” basis.

 

22

 

16.02.             Landlord shall have the right to enter and pass through the Demised Premises or
any part or parts thereof,

 

(i)    to examine the Demised Premises and to show
them to the fee owners, grantors or lessors of underlying or ground leases or
mortgagees and to prospective purchasers, mortgagees or lessees of the Building
as an entirety, and

 

(ii)   for the purpose of performing such maintenance
and making such repairs or changes in or to the Demised Premises or in or to
the Building or its facilities as may be provided for or permitted by this Lease
or as may be mutually agreed upon by the parties or as Landlord may be required
to make by laws and requirements of public authorities. Landlord shall be
allowed to take all materials into and upon the Demised Premises that may be
required for such repairs, changes or maintenance, without being deemed thereby
to evict Tenant from the whole or any part of the Demised Premises.

 

Landlord’s rights under this Section 16.02 shall be exercised at
reasonable times and upon reasonable notice (except in the case of emergency
work under clause (ii) above) and in such manner as to create the least
practicable interference with Tenant’s use of the Demised premises; provided,
however, that the foregoing shall not obligate Landlord to perform such work
outside of Operating Hours.

 

16.03.             Landlord shall also have the right to enter on
and pass through the Demised Premises, or any part thereof, at such times as
such entry shall be required by circumstances of emergency affecting the
Demised Premises or the Building. In such event, if practicable, Landlord or its agents shall be accompanied by a designated representative of
Tenant or a member of the police, fire, water or other municipal department concerned
or of a recognized protection company or of a public utility which is
concerned.

 

16.04.             Landlord upon 10 days’ written notice to Tenant
shall have the right at any time without thereby creating any actual or
constructive eviction or incurring any liability to Tenant therefor, and
without abatement in rent, to change the arrangement or location of lobbies,
entrances, passageways, doors, doorways, stairways, elevators, corridors and
other like portions of the Building outside of the Demised Premises, provided that such change does not interfere with Tenant’s
access to the Demised Premises or effect a material reduction in the useable
area of the Demised Premises or in the services which Landlord is obligated to
provide hereunder.

 

16.05.             Landlord may access Building equipment on the
floors in which the Demised Premises are located, subject however to the terms
and conditions of Section 16.02 above.

 

ARTICLE 17

 

BANKRUPTCY

 

17.01.             If at any time prior to the date herein fixed
as the Commencement Date there shall be filed by or against Tenant in any court
pursuant to any statute either of the United States or of any State a petition
in bankruptcy or insolvency or for reorganization or for the appointment of a
receiver or trustee of all or a portion of Tenant’s property, and within one
hundred eighty (180) days thereafter Tenant fails to secure a

 

23

 

discharge thereof, or if Tenant makes an assignment
for the benefit of creditors, or petitions for or enters into an arrangement
this Lease shall ipso  facto be cancelled and terminated, in which
event neither Tenant nor any person claiming through or under Tenant or by virtue of any statute
or of an order of any court shall be entitled to possession of the Demised
premises and Landlord, in addition to the other rights and remedies given by Article 18
hereof and by virtue of any other provision herein or elsewhere in this Lease
contained or by virtue of any statute or rule of law, may retain as liquidated damages any rent, security,
deposit or monies received by it from Tenant or others on behalf of Tenant upon
the execution hereof.

 

17.02.             If at the date fixed as the Commencement Date
or at any time during the term hereby demised there shall be filed by or
against Tenant in any court pursuant to any statute either of the United States
or of any State a petition in bankruptcy or insolvency or for reorganization or
for the appointment of a receiver or trustee of all or a portion of Tenant’s
property, and within sixty (60) days thereafter Tenant fails to secure a
discharge thereof, or if Tenant makes an assignment for the benefit of
creditors or petitions for or enters into an arrangement, this Lease, at the
option of Landlord, exercised within a reasonable time after notice of the
happening of any one or more of such events, may be cancelled and terminated,
in which event neither Tenant nor any person claiming through or under Tenant
by virtue of any statute or of an order of any court shall be entitled to
possession or to remain in possession of the Demised Premises but shall
forthwith quit and surrender the Demised Premises, and Landlord, in addition to
the other right and remedies Landlord has by virtue of any other provision
herein or elsewhere in this Lease contained or by virtue of any statute or rule
of law, may retain as liquidated damages any rent, security, deposit or monies
received by it from Tenant or others on behalf of Tenant.

 

17.03.             It is stipulated and agreed that in the event
of the termination of this Lease pursuant to Section 17.01 or Section 17.02,
Landlord shall forthwith, notwithstanding any other provisions of this Lease to
the contrary, be entitled, to recover from Tenant as and for liquidated damages
an amount equal to the difference between the rent reserved hereunder for the
unexpired portion of the term demised and the then fair and reasonable rental
value of the Demised Premises for the same period. In the computation of such
damages the difference between any installment of rent becoming due hereunder
after the date of termination and the fair and reasonable rental value of the
Demised Premises for the period for which such installment was payable shall be
discounted to the date of termination at the announced “prime rate” then in
effect of Citibank N.A. If such premises or any part thereof be relet by the
Landlord for the unexpired term of this Lease or any part thereof, before
presentation of proof of such liquidated damages to any court, commission or
tribunal, the amount of rent reserved upon such re-letting shall be deemed
prima facie to be the fair and reasonable rental value for the part or the
whole of the premises so re-let during the term of the re-letting, it being
understood that Landlord shall use its best efforts to re-let the Demised
Premises as aforesaid so as to mitigate its damages hereunder. Nothing herein
contained shall limit or prejudice the right of the Landlord to prove for and
obtain as damages by reason of such termination, 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, equal to or less than the amount of the difference referred
to above.

 

24

 

17.04.             If an order for relief is entered, or if any
stay or other act becomes effective in favor of Tenant or Tenant’s interest in
this Lease in any proceeding which is commenced by or against Tenant under the
present or any future federal bankruptcy code or any other present or future
applicable federal, state or other statute or law, Landlord shall be entitled
to invoke any and all rights and remedies available to it under such bankruptcy
code, statute, law or this Lease, including, without limitation, such, rights
and remedies as may be necessary to adequately protect Landlord’s right, title
and interest in and to the Demised Premises or any part thereof and adequately
assure the complete and continuous future performance Of Tenant’s obligations
under this Lease. Adequate protection of Landlord’s right, title and interest
in and to the Demised Premises, and adequate assurance of the complete and
continuous future performance of Tenant’s obligations under this Lease shall be
governed by the requirements set forth in Section 17.05.

 

17.05.             (a) In the event that Tenant shall become a
debtor under Chapter 7 of Title 11 of the United States Code, as same may be
amended or superseded from time to time (“Code”) and Tenant’s trustee or Tenant
shall elect to assume this Lease for the purpose of assigning the same or
otherwise, such election and assignment may be made only if the provisions of
subsections 17.05. (c) and 17.05. (e) are satisfied. If Tenant or
Tenant’s trustee shall fail to elect to assume this Lease within 60 days after
the filing of such petition or such additional time as provided by the court
within such 60-day period, this Lease shall be a rejected lease within the
meaning of §365 of the Code. Immediately thereupon, Landlord shall be entitled
to possession of the Premises without further obligation to Tenant’s or Tenant’s
trustee and this Lease shall terminate, but Landlord’s right to be compensated
for damages pursuant to the terms of this Lease in any such proceeding shall
survive.

 

(b)   In the event that a petition for reorganization
or adjustment of debts is filed concerning Tenant under Chapter 11 of the Code,
as same may be amended or superseded from time to time, or a petition is filed
under Chapter 7 of the Code and is converted to Chapter 11, Tenant’s trustee or
Tenant, as debtor-in-possession, must elect to assume this Lease within 120
days from the date of the filing of the petition, or Tenant’s trustee or
Tenant, as debtor-in-possession, shall be deemed to have rejected this Lease.

 

(c)   In the event that Tenant, Tenant’s trustee or
Tenant, as debtor-in-possession, has failed to perform all of

Tenant’s obligations under this Lease within the time periods (excluding grace
periods) required for such performance, no election by Tenant’s trustee or
Tenant, as debtor-in-possession, to assume this Lease, whether under Chapter 7
or Chapter 11, shall be effective unless all of the following conditions have
been satisfied:

 

(1)   Tenant’s trustee or Tenant, as debtor—in-possession,
shall have cured all defaults under the Lease, or has provided Landlord with
Assurance (as defined below) that it will cure, (i) all defaults susceptible of
being cured by the payment of money within 10 days from the date of such
assumption and (ii) all other defaults under this Lease which are susceptible
of being cured by the performance of any act, promptly after the date of such
assumption.

 

(2)   Tenant’s trustee or Tenant, as debtor—in-possession
shall have compensated, or has provided Landlord with Assurance that within 10
days from the date of such assumption it will compensate Landlord for any
actual 

 

25

 

pecuniary loss incurred by
Landlord arising from the default of Tenant, Tenant’s trustee or Tenant, as
debtor-in-possession, indicated
in any statement of actual pecuniary loss sent by Landlord to Tenant’s trustee
or Tenant, as debtor-in-possession.

 

 

(3)   Tenant’s trustee or Tenant, as debtor—in-possession,
shall be provided Landlord with Assurance of the future performance of such of
the obligations under this Lease of Tenant, Lessee’s trustee or Tenant, as debtor-in-possession,
and if Tenant’s trustee or Tenant, as debtor-in-possession has provided such
Assurance, Tenant’s trustee or Tenant, as debtor-in-possession, shall also (i)
deposit with Landlord, as security for the timely payment of rent hereunder, an
amount equal to 3 months’ Rent, and (ii) pay in advance to Landlord on the date
any Rent is due and payable, one-twelfth of Tenant’s annual obligations for
Additional Rent pursuant to this Lease. The obligations imposed upon Tenant’s
trustee or Tenant, as debtor-in-possession, shall continue with respect to
Tenant or any assignee of this Lease after the completion of bankruptcy
proceedings.

 

(4)   Such assumption will not breach or cause a
default under any provision of any other lease, mortgage, financing agreement
or other agreement by which Landlord is bound relating to the Land or the
Building.

 

(d)           For the purposes of Sections 17.04 and 17.05 of
this Lease, Landlord and Tenant acknowledge that “Assurance” shall mean no less
than:

 

(1)   Tenant’s trustee or Tenant, as debtor— in-possession,
having and continuing to have sufficient unencumbered assets after the payment
of all secured obligations and administrative expenses to assure Landlord that
sufficient funds will be available to fulfill the obligations of Tenant under
this Lease, and there shall have been deposited with Landlord, or the
Bankruptcy Court shall have entered an order segregating sufficient cash or
cash equivalents payable to Landlord, acceptable as to value and kind to
Landlord, to secure to Landlord the obligations of Tenant, Tenant’s trustee or
Tenant, as debtor-in-possession, to cure the defaults under this Lease,
monetary and non-monetary, within the time periods set forth above, and

 

(2)   the Tenant complies with all of its
obligations under this Lease.

 

(e)           In the event that this Lease is assumed in accordance
with Section 17.05 and thereafter Tenant is liquidated or files a
subsequent petition for reorganization or adjustment of debts under Chapter 11
of the Code, Landlord may, at its option, terminate this Lease and all rights
of Tenant hereunder, by giving Tenant notice of its election so to terminate
within thirty (30) days after the occurrence of either of such events.

 

(f)            (i) If Tenant’s trustee or Tenant, as debtor-in-possession,
shall have assumed the Lease pursuant to the terms and provisions of paragraph
17.05(a) or 17.05(b) for the purpose of assigning (or elects to assign) this
Lease to an assignee, this Lease may be so assigned only if the proposed
assignee has provided adequate assurance of future performance of all of the
terms, covenants and conditions of this Lease to be performed by Tenant
including, without limitation, the obligation to pay Deferred Rent. As used
herein, “adequate assurance of future performance” shall mean that no less than
each of the following conditions shall have been satisfied:

 

26

 

(1)   the proposed assignee has furnished Landlord
with either (i) a current financial statement audited by a certified public
accountant indicating a net worth and working capital in amounts which Landlord
reasonably determines to be sufficient to assure the future performance by such
assignee of Tenant’s obligations under this Lease, or (ii) a guaranty, or
guaranties, in form and substance satisfactory to Landlord from one or more
persons with a net worth and working capital in amounts which Landlord reasonably
determines to be sufficient to assure the future performance of Tenant’s
obligations under this Lease;

 

(2)   Landlord has obtained from others required
under any lease, mortgage, financing arrangement or other agreement by which
Landlord is bound all consents or waivers necessary to permit Landlord to
consent to such assignment;

 

(3)   the proposed assignment will not release or
impair any guaranty of the obligations of Tenant (including the proposed
assignee) under this Lease; and

 

(4)   such assignment and the proposed assignee satisfies
the requirements of Article 12 hereof.

 

(i)         Any person or entity to
which this Lease is assigned pursuant to the provisions of the Code shall be
deemed without further act or deed to have assumed all of the obligations
arising under this Lease on and after the date of such assignment. Any such
assignee shall upon demand execute and deliver to Landlord an instrument
confirming such assumption in a form acceptable to Landlord.

 

(ii)        If Tenant’s trustee or Tenant, as
debtor-in-possession, assumes this Lease and proposes to assign the same
pursuant to §365 of the Code, to any person who shall have made a bona fide offer
to accept an assignment of this Lease, on terms acceptable to the Trustee or
Tenant, as debtor-in-possession, then notice of such proposed assignment,
setting forth (1) the name and address of such person, (2) all of the terms and
conditions of such offer, and (3) the adequate assurance to be provided
Landlord to assure such person’s future performance under this Lease, including
the Assurance defined above and the adequate assurance of future performance
defined below, shall be given to Landlord by the Trustee, Tenant or Tenant as
debtor-in-possession, no later than thirty (30) days after receipt by the
Trustee or Tenant as debtor-in-possession of such offer.

 

Landlord
and Tenant hereby acknowledge that the assurance concerning a proposed assignee required under §
365(f)(2) of the Code, as a condition to any assignment of this Lease by a Trustee or Tenant, as
debtor-in-possession, shall be inadequate, within the meaning of § 365(f)(2) of
the Code, without reference to the standards of adequacy set forth in §§ 365(b)(1)
and 365(b)(3) of the Code, unless evidence of the proposed assignee’s financial
ability is provided by a balance sheet, income statement and cash flow
statement certified by an independent certified public accountant.  Additionally, the proposed assignee shall be
required to conduct its business in the same manner as Tenant so as to maintain
the tenant mix and balance of the Building, without the agreement by the
proposed assignee to conduct its business in the same manner as Tenant.

 

27

 

(iii)       Notwithstanding the above, no later than
twenty (20) days prior to the date that a Trustee or Tenant, as debtor-in-possession, shall move before a court of competent
jurisdiction for authority to enter into such assignment and assumption,
Landlord shall have the prior right and option, to be exercised by notice to
the Trustee or Tenant, as debtor-in-possession, given at any time prior to the
approval by a court of competent jurisdiction, to accept, or to cause Landlord’s
designee 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 a proposed assignee, less any brokerage commissions which may be payable out
of the consideration to be paid by such person for the assignment of this
Lease; and the Trustee or Tenant, as debtor-in-possession, shall not assign
this Lease to a party other than Landlord or Landlord’s designee until and
unless Landlord has failed or refused to accept such prior right and option to
the assignment of this Lease.

 

(g)        When, pursuant to the Code, Tenant’s trustee
or Tenant, as debtor-in-possession, shall be obligated to pay reasonable use
and occupancy charges for the use of the Demised Premises, such charge shall
not be less than the rent and additional rent payable by Tenant under this
Lease.

 

(h)        Neither the whole nor any portion of Tenant’s
interest in this Lease or its estate in the Demised Premises shall pass to any
trustee, receiver, assignee for the benefit of creditors, or any other person
or entity, or otherwise by operation of law under the laws of any state having
jurisdiction of the person or property of the Tenant unless Landlord shall have
consented to such transfer in writing. No acceptance by Landlord of Rent or any
other payments from any such trustee, receiver, assignee, person or other
entity shall be deemed to constitute such consent by Landlord, nor shall it be
deemed a waiver of Landlord’s right to terminate this Lease for any transfer of
Tenant’s interest under this Lease without such consent.

 

ARTICLE 18 

 

DEFAULTS,
REMEDIES AND WAIVER OF REDEMPTION

 

18.01.       (1)       If:

 

(x)     Tenant defaults in fulfilling any of the
covenants of this Lease requiring the payment of fixed rent or additional rent,
which default continues for seven (7) days after Landlord serves a written
notice upon Tenant specifying such default, or

 

(y)    Tenant defaults (taking into account any requirement
for notice thereof and the expiration of any applicable grace period hereunder)
in complying with any other material term, condition or provision of this Lease
or deserts or abandons the Demised Premises, and (i) if such default, desertion
or abandonment is not remedied within twenty (20) days after Landlord serves written
notice upon Tenant specifying the nature of said default or other defect, or
(ii) if a default occurs, and if such default shall be of a nature that cannot
be completely cured or remedied within each twenty (20) day period, Tenant
shall not have

 

28

 

diligently commenced curing
such default within such twenty (20) day period or shall not thereafter with
reasonable diligence and good faith proceed to remedy or cure such default or
shall not have completely cured said default within 150 days after said notice,

 

then at any time after the expiration of such seven
(7) day period (with respect to paragraph 18.01 (1) (x) above, or such twenty
(20) day period (with respect to paragraph 18.01 (1) (y) above) Landlord may
serve a written three (3) days’ notice of cancellation of this Lease upon
Tenant, and upon the expiration of said three (3) days, this Lease and the term
hereunder shall end and expire as fully and completely as if the date of
expiration of such three (3) day period were the day herein definitely fixed
for the end and expiration of this Lease and the term thereof and Tenant shall
then quit and surrender the Demised Premises to Landlord but Tenant shall
remain liable as hereinafter provided.

 

(2)     If Tenant shall default in the payment of
fixed rent and/or additional rent and such default remains uncured beyond the
expiration of the cure period set in Section 18.01 (1) (x) hereof; or if
the three (3) day notice of cancellation provided for in subdivision (1) of
this Section 18.01 shall have been given, and the term shall expire as
aforesaid; or if any execution or attachment shall be issued against Tenant or
any of Tenant’s property whereupon the Demised Premises shall be taken or
occupied or attempted to be taken or occupied by someone other than Tenant and
the same shall not be vacated or discharged within thirty (30) days; or if
Tenant shall fail to move into or take possession of the Demised Premises
within sixty (60) days after the Commencement Date of this Lease, and there
shall be no bona fide dispute as to whether the Commencement Date has occurred,
then and in any of such events Landlord may, without notice, re-enter the
Demised Premises by any lawful means and dispossess Tenant and the legal representatives
of Tenant or other occupant of the Demised Premises and remove their effects by
summary proceedings or otherwise, and hold the Demised Premises as if this
Lease had not been made, but Tenant shall remain liable hereunder as
hereinafter provided.

 

18.02.             In case of any such default, re-entry,
expiration and/or dispossession by summary proceedings or otherwise, (a) the
fixed rent and additional rent shall become due thereupon and be paid up to the
time of such re-entry, dispossession and/or expiration, together with such
reasonable expenses as Landlord may incur (such as attorneys’ fees and
brokerage expenses) for putting the Demised Premises in good order and/or for
preparing the same for re-rental, (b) Landlord may re-let the Demised Premises
or any part or parts thereof, either in the name of Landlord or otherwise (but
shall have no obligation to do so), for a term or terms, which may at Landlord’s
option be less than or exceed the period which would otherwise have constituted
the balance of the term of this Lease and may grant such concessions or free
rent as Landlord shall, in its sole discretion, deem necessary or desirable;
and/or (c) Tenant shall also pay Landlord as liquidated damages for the failure
of Tenant to observe and perform said Tenant’s covenants herein contained, any
deficiency between the fixed rent and additional rent hereby reserved and/or
covenanted to be paid and the net amount, if any, of the rents collected or to
be collected on account of the lease or leases of the Demised Premises for each
month of the period which would otherwise have constituted the balance of the
term of this Lease. Landlord agrees to use reasonable efforts to relet the
Demised Premises as aforesaid so as to mitigate its damages as a result of any
such default, re-entry, expiration and/or dispossession. In computing Tenant’s

 

29

 

liability for damages hereunder there shall be added
to the said deficiency such reasonable expenses as Landlord may incur in connection
with re-letting, such as legal expenses, attorneys’ fees, brokerage expenses
for putting the Demised Premises in good order and/or for preparing the same
for re-letting. Any such damages shall, at Landlord’s option, be paid on an
accelerated basis as provided for in the following sentence or be paid in
monthly installments by Tenant on the rent days specified in this Lease and any
suit brought to collect the amount of the deficiency for any month or months
shall not prejudice in any way the rights of Landlord to collect the deficiency
for any subsequent month or months by a similar proceeding. Landlord shall be
entitled to recover from Tenant, as and for Landlord’s damages, an amount equal
to the difference between the fixed rent, additional rents and other charges
reserved hereunder for the period which otherwise would have constituted the
balance of the term of this Lease and the then present rental value of the
Demised Premises for such period, both discounted at the rate of four (4%)
percent per annum to present worth, all of which shall immediately be due and
payable by Tenant to Landlord. In determining the rental value of the Demised
Premises the rental realized by any reletting, if such reletting be
accomplished by Landlord within a reasonable time after the termination of this
Lease, shall be deemed prima facie to be the rental value, but if Landlord
shall not undertake to relet or having undertaken to relet has not accomplished
reletting, then it will be conclusively presumed that the rents received under
this Lease represent the rental value of the Demised Premises for the purposes
hereof (in which event Landlord may recover from the Tenant, the full total of
all rents and additional charges due hereunder, discounted to present value as
hereinbefore provided). Landlord shall be obligated, however to account to
Tenant for the fixed minimum rent and additional rents received from persons
using or occupying the Demised Premises during the period representing that
which would have constituted the balance of the term of this Lease, but only at
the end of said period and only if Tenant shall have paid to Landlord its
damages as provided herein, and only to the extent of sums recovered from
Tenant as Landlord’s damage, the Tenant waiving any claim to any surplus.
Landlord at Landlord’s option may make such alterations, repairs, replacements
and/or decorations in the Demised Premises as Landlord in Landlord’s sole
judgment considers advisable and necessary for the purpose of re-letting the
Demised Premises; and the making of such alterations and/or decorations shall
not operate or be construed to release Tenant from liability hereunder as
aforesaid. Any such action may be an action for the full amounts of all rents
and damages suffered or to be suffered by Landlord. In the event of a breach or
threatened breach by Tenant of any of the covenants or provisions hereof,
Landlord shall have the right of injunction and the right to invoke any remedy
allowed at law or in equity as if re-entry, summary proceedings and other
remedies were not herein provided for. Mention in this Lease of any particular
remedy shall not preclude Landlord from any other remedy, in law or in equity.
The foregoing remedies and rights of Landlord are cumulative. Tenant hereby
expressly waives any and all rights of redemption granted by or under any
present or future laws in the event of Tenant’s being evicted or dispossessed
for any cause, or in the event of Landlord’s obtaining possession of the
Demised Premises by reason of the violation by Tenant of any of the covenants
and conditions of this Lease, or otherwise.

 

30

 

ARTICLE 19

 

LANDLORD’S
RIGHT TO PERFORM TENANT’S OBLIGATIONS,

REIMBURSEMENT
TO LANDLORD, ADDITIONAL RENT AND

PAYMENT
THEREOF - LATE CHARGE

 

19.01.             If Tenant shall default in the observance or
performance of any term or covenant on its part to be observed or performed
under or by virtue of any of the terms or provisions of this Lease, Landlord,
without being under any obligation to do so and without thereby waiving such
default, may after twenty (20) days’ notice to Tenant, except in case of
emergency where no notice shall be required, remedy such default for the
account and at the expense of Tenant. If Landlord makes any reasonable
expenditures or incurs any obligations for the payment of money in connection
therewith or in instituting, prosecuting or defending any action or proceedings
by reason of default, wrongful act or negligence of Tenant or Tenant’s
employees, agents or invitees occurring before or during the term of this Lease
or after the expiration or termination of the term of this Lease, including but
not limited to legal expenses and attorneys’ fees, or if Landlord sustains or
incurs any expenditures, damages or fines due to non-performance or
noncompliance with or breach or failure to observe any term, covenant or
condition of this Lease upon Tenant’s part to be kept, observed, performed or
complied with, such sums paid or obligations incurred with legal interest and
costs shall be paid to Landlord by Tenant on demand, and if not paid, Landlord,
at Landlord’s option, in addition to any other remedy, may deem the same to be
additional rent.

 

19.02.             All amounts over and above the fixed rent
payable by Tenant to Landlord under the terms of this Lease shall be deemed
additional rent hereunder and shall be paid by Tenant in the same manner as an
installment of the fixed rent within ten (10) days after notice to Tenant by
Landlord that any such amount is payable unless this Lease shall specifically
provide otherwise, and Landlord shall have all the rights and remedies in the
event of the non-payment thereof as it would have had in the event of the
non-payment of any installment of fixed rent. Tenant’s obligation to pay any additional
rent which shall have theretofore become due and payable shall survive the
expiration or earlier termination of this Lease.

 

19.03.             If Tenant shall fail to pay any rent within
ten days after such rent shall be due, Tenant shall pay Landlord interest on
such rent from the date on which such rent became due to the date on which such
rent is paid at an annual rate two percentage points higher than the announced “prime
rate” of Citibank N.A.

 

ARTICLE 20 

 

COVENANT OF QUIET ENJOYMENT

 

Landlord covenants that upon
Tenant paying the fixed rent and additional rent and observing and performing
all the terms, covenants and provisions of this Lease on Tenant’s part to be
observed and performed, Tenant may peaceably and quietly enjoy the Demised
Premises, subject nevertheless to the terms and conditions of this Lease
provided that this covenant shall bind and be enforceable against Landlord,
subject to the terms hereof, only so long as Landlord is in possession and is
collecting rent from Tenant but not thereafter.

 

31

 

ARTICLE 21 

 

EXCAVATION

 

In the event that an
excavation or any construction should be made for building or other purposes
upon land adjacent to the Building, or should be authorized to be made, Tenant
shall, if necessary, afford to the person or persons causing or authorized to
cause such excavation or construction, license to enter upon the Demised
Premises for the purpose of doing such work as shall reasonably be necessary to
protect or preserve the wall or walls of the Building, or the Building, from
injury or damage and to support them by proper foundations, pinning and/or
underpinning, or otherwise. Nothing contained herein shall be construed to
limit or preclude any claim, action or proceeding by Tenant against any third
party on account of such excavation or construction.

 

ARTICLE 22

 

SERVICES AND EQUIPMENT

 

22.01.            Landlord, at its own cost and expense shall:

 

(a)       Provide elevator service, during Operating Hours
with the elevators serving the Demised Premises and provide at least one
passenger elevator at all other times so as to provide access to the Demised
Premises 24 hours a day, seven days a week;

 

(b)       Supply heat, when legally required, andventilation in the Demised
Premises at all times during the year during the Operating Hours, all from the
perimeter ducts heretofore installed by Landlord in the Demised Premises,
subject to the terms and conditions set forth in subsection 22.01(c)
below. Landlord shall have no responsibility or liability for the ventilating
conditions and/or temperature of the Demised Premises during the hours or days
Landlord is not required to furnish heat or ventilation pursuant to the first
sentence of this paragraph. Landlord has informed Tenant that the windows of the
Demised Premises and the Building may be sealed, and that the Demised Premises
may become uninhabitable and the air therein may become unbreathable during the
hours or days when Landlord is not required pursuant to this paragraph to
furnish heat or ventilation. Insofar as air temperature and ventilation are
concerned, any use or occupancy of the Demised Premises during the hours or
days Landlord is not so required to furnish heat or ventilation to the Demised
Premises shall be at the sole risk, responsibility and hazard of Tenant. Such
condition of the Demised Premises shall not constitute nor be deemed to be a
breach or a violation of this Lease or of any provision hereof, nor shall it be
deemed any eviction, nor shall Tenant claim or be entitled to claim any
abatement of rent nor make any claim for any damages or compensation by reason
of such condition of the Demised Premises.

 

Tenant shall in any event
cause all of the windows in the Demised Premises to be kept closed; shall keep
entirely unobstructed at all times all of the vents, intakes, outlets and
grills; and shall comply with and observe all reasonable regulations and
requirements prescribed by Landlord for the proper functioning of the heating,
ventilating and air-conditioning system;

 

(c)       Provide on days other than Saturdays and union
holidays as designated by Local 32B-32J of the Building Service Employees
International Union, or any successor thereto,

 

32

 

cleaning services in the Demised Premises and public
portions of the Building in accordance with Exhibit B, provided, however,
that except as may be otherwise provided by separate agreement Landlord shall
not be obligated to clean any portion of the Demised Premises used for
computer, storage or reproduction facilities, private lavatories or the
preparation, dispensing or consumption of food and beverages (it being
understood and agreed that the existing mens’ lavatory and women’s lavatory
contained within the Demised Premises shall be considered to be general
building restroom services for purposes of the cleaning specifications
contained in Exhibit B);

 

(d)       Furnish hot and cold water for lavatory,kitchen, cleaning and drinking
purposes. If Tenant requires, uses or consumes water for any other purposes,
Tenant agrees that Landlord may install a meter or meters or other means to
measure Tenant’s water consumption, and Tenant further agrees to reimburse
Landlord for the cost of the meter or meters and the installation thereof, and
to pay for the maintenance of said meter equipment. Tenant shall reimburse
Landlord for the cost of all water consumed as measured by said meter or
meters, including sewer rents, and all other charges imposed by any authority,
on, or measured by, the use of water at the rates (as averaged) charged
Landlord by the supplier of such water;

 

(e)       Provide electrical current for the lighting of
public stairs and other public areas, and building, exit and elevator
directional signs during Operating Hours and when legally required; and

 

(f)        Provide chilled air during normal business hours
from May 1st to September 30th each year to service the Sixteenth Floor of
the Demised Premises to Building Standard but in no event less than the
prevailing standard set by OSHA. Landlord shall maintain and repair the
airconditioning equipment to service the Sixteenth Floor of the Demised
Premises at its own cost and expense. 
Tenant shall cooperate fully with Landlord at all times and abide by all
regulations and requirements which Landlord may reasonably prescribe for the
proper functioning and protection of the airconditioning system.

 

22.02.             Landlord reserves the right to interrupt, curtail
or suspend the services required to be furnished by Landlord under this Article 22
when the necessity therefor arises by reason of accident, repairs, emergency,
mechanical breakdown, or when required by any law, order or regulation of any
Federal, State, County or Municipal authority, or as the result of the making
by Landlord of any additions, improvements or installations in the Building or
for any cause beyond the reasonable control of Landlord. Landlord shall use
reasonable diligence to complete all required repairs or other necessary work
as quickly as reasonably possible so that Tenant’s inconvenience resulting
therefrom may be for as short a period of time as circumstances will reasonably
permit. No diminution or abatement of rent or other compensation shall or will
be claimed by Tenant as a result therefrom, nor shall this Lease or any of the
obligations of Tenant be affected or reduced by reason of such interruption,
curtailment or suspension.

 

22.03.             Tenant shall reimburse Landlord for the costs
to Landlord of removal from the Demised Premises and the Building of any refuse
and rubbish of Tenant in excess of normal office waste, and Tenant shall pay
all bills therefor when rendered.

 

33

 

ARTICLE 23 

 

ELECTRICITY

 

(a)   Landlord shall furnish to Tenant the electric energy which Tenant
requires in the Demised Premises on a “rent inclusion” basis, through the
presently installed electrical facilities for Tenant’s reasonable use in the
Demised Premises for lighting, light office equipment and the usual small
business machines, including Xerox or other copying machines.  Subject to the following provisions of this Article 23,
there shall be no charge to Tenant therefor by way of measuring the same on any
meter or otherwise, electric current being included as an additional service in
the fixed rent payable hereunder.  Landlord shall not in any way be liable or
responsible to Tenant for any loss or damage or expense which Tenant may
sustain or incur if either the quantity or character of electric service is
changed or is no longer available or suitable for Tenant’s requirements.

 

(b)  (i)  Tenant acknowledges and
agrees (A) that the annual fixed rent hereinabove set forth in this Lease
includes the Electricity Rent Inclusion Factor of $2.75 per square foot to compensate
Landlord for the electrical wiring and other installations necessary for, and
for its obtaining and redistribution of, electric current as an additional
service; and (B) that said Electricity Rent Inclusion Factor (hereinafter called
“ERIF”), which shall be subject to periodic adjustments as herein provided, has
been partially based upon Tenant’s estimated connected electrical load and
hours of use thereof for ordinary lighting and light office equipment, during
ordinary business hours.  The “Electricity
Rent Inclusion Factor” shall mean the amount determined by applying the
estimated connected electrical load and usage thereof in the Demised Premises
(as the same may hereafter from time to time be
determined by Landlord’s electrical consultant as hereinafter provided) to the
rate charged for such load and usage in the service classification in effect on
January 1, 1995 pursuant to which Landlord then purchased electric current
for the entire Building from the public utility corporation.  If the cost to Landlord of electricity shall
have been, or shall be, increased subsequent to January 1, 1995 (whether
such increase occurs prior to or during the Term of this Lease), by change in
Landlord’s electric rates, charges, fuel adjustment, or service
classifications, or by taxes or charges of any kind imposed thereon, or for any
other such reason, then the aforesaid ERIF portion of the fixed rent shall be
increased in the same percentage and the fixed rent shall be increased
accordingly.

 

(ii)              Any such percentage increase in Landlord’s
cost due to change in Landlord’s electric rates, charges, etc., shall be
computed by the application of the average consumption (energy and demand) of
electricity for the entire Building for the twelve (12) full months immediately
prior to the rate change, other change in cost, or any changed methods of or
rules on billing for same, on a consistent basis to the new rate and/or service
classifications and to the immediately prior existing rate and/or service
classifications.  If the average
consumption of electricity for the entire Building for said prior twelve (12)
full months cannot reasonably be applied and used with respect to changed
methods of or rules on billing, then the percentage increase shall be computed
by the use of the average consumption (energy and demand) for the entire Building
for the first three (3) months under such changed methods of or rules on
billing, projected to a full twelve (12) months; and that same consumption, so
projected, shall be applied to the rate and/or service classifications which
existed immediately prior to the changed methods of or rules on billing.  The parties acknowledge that they understand
that it is anticipated that existing

 

34

 

electric rates, charges, etc., may be changed by
virtue of time-of-day rates or other methods of billing, and that the foregoing
reference to changes in methods of or rules on billing is intended to include
any such change.  The parties agree that
a reputable, independent electrical consultant, selected by Landlord (“Landlord’s
electrical consultant”) shall determine the percentage for the changes in the
ERIF based on changes in Landlord’s electric rates, charges, etc.

 

(c)   (i)   The parties agree that Landlord’s electrical
consultant may from time to time make surveys in the Demised Premises covering
the electrical equipment and fixtures and use of current therein, and the
connected electrical load and usage portion of the ERIF shall be changed in
accordance with such survey, and the ERIF automatically redetermined, accordingly,
by Landlord’s electrical consultant. The fixed annual rent shall be
appropriately adjusted effective as of the date of any such change in connected
load and usage, as disclosed by said survey. In no event, is the originally
specified ERIF portion of the fixed rent (as adjusted by any electricity cost
increases of Landlord after January 1, 1995) to be reduced.  The cost of any such survey shall be borne
equally by Landlord and Tenant.

 

(ii)         The determination of change in the ERIF by
Landlord’s consultant shall be binding and conclusive on Landlord and on Tenant
from and after the delivery of copies of such determination to Landlord and
Tenant, unless within fifteen (15) days after the delivery of such copies,
Tenant disputes such determination.  If
Tenant disputes the determination, it shall, at its own expense, obtain from a
reputable, independent electrical consultant its own survey of Tenant’s
electrical lighting and power load and hours of use thereof, and a
determination of such change in the ERIF in accordance with the provisions of
this Article 23.  Tenant’s
consultant and Landlord’s consultant then shall seek to agree on a finding of
such determination of such change in the ERIF. 
If they cannot agree, they shall choose a third reputable electrical
consultant whose cost shall be shared equally by Landlord and Tenant, to make a
similar survey, and the determination of such ERIF change by such third
electrical consultant shall be controlling. 
(If they cannot agree on such third consultant, within ten (10) days,
then either party may apply to the Supreme Court in the County of New York for
the appointment of such third consultant.) However, pending such determination,
Tenant shall pay to Landlord the amount of ERIF as determined by Landlord’s
independent electrical consulting firm, provided, however, if the amount of
ERIF determined as aforesaid is different from that determined by Landlord’s
electrical consulting firm, then Landlord and Tenant shall make adjustment for
any deficiency owed by Tenant or overage paid by Tenant pursuant to the
decision of Landlord’s electrical consulting firm.

 

(d)  Landlord reserves the right to discontinue furnishing
electric energy to Tenant at any time upon sixty (60) days’ written notice to
Tenant, and from and after the effective date of such termination, Landlord
shall no longer be obligated to furnish Tenant with electric energy, provided,
however, that such termination date may be extended for a time reasonably
necessary for Tenant to make arrangements to obtain electric service directly
from the public utility company servicing the Building.  If Landlord exercises such right of
termination, this Lease shall remain unaffected thereby and shall continue in
full force and effect, and thereafter Tenant shall diligently arrange to obtain
electric service directly from the public utility company servicing the
Building, and may utilize the then existing electric feeders, risers and wiring
serving the Demised Premises to the extent available and safely capable of
being used for such purpose and only to the extent of Tenant’s then authorized

 

35

 

connected load.  Landlord shall be obligated to pay no part of
any cost required for Tenant’s direct electric service. Commencing with the
date when Tenant receives such direct service, and as long as Tenant shall
continue to receive such service, the fixed rent payable under this Lease shall
be reduced to what the fixed rent would then have been but for the adjustments
under this Article 23 and the original ERIF payable by Tenant included in
the fixed annual rent as set forth in Article 2 hereof.

 

(e)   (i) Tenant agrees not to connect any
additional electrical equipment of any type to the Building electric distribution
system, other than lamps, typewriters and other small office machines which
consume comparable amounts of electricity, without the Landlord’s prior written
consent, which consent shall not be unreasonably withheld.  Any additional risers, feeders, or other
equipment proper or necessary to supply Tenant’s electrical requirements, upon
written request of Tenant, will be installed by Landlord, at the sole cost and
expense of Tenant, if, in Landlord’s sole judgment, the same are necessary and
will not cause permanent damage or injury to the Building or the Demised
Premises, or cause or create a dangerous or hazardous condition or entail
excessive or unreasonable alterations, repair or expense or interfere with or
disturb other tenants or occupants.

 

(ii)         At Landlord’s option, Tenant shall purchase
from Landlord or Landlord’s agent all lighting tubes, lamps, bulbs and ballasts
used in the Demised Premises and Tenant shall pay Landlord’s reasonable charges
for providing and installing same, on demand, as additional rent.

 

(f)    In no event shall the fixed rent under this
Lease be reduced below the fixed rent specified herein by virtue of this Article 23
except as provided in Section (d).

 

(g)   Landlord shall have the option at any time
upon ten (10) days prior written notice to Tenant to discontinue supplying electric
energy to Tenant in accordance with the provisions of this Article 23, and
elect instead to furnish electric energy to Tenant on a submetered basis.  In the event that Landlord shall exercise the
option contained in this Section 23(g), the fixed rent set forth herein shall
be reduced in the manner described in Section 23 (d) hereof.

 

ARTICLE 24 

 

BROKER

 

24.01.              Tenant represents to Landlord that it has dealt
with no broker in connection with this transaction other than The Galbreath
Company, L.P. (the “Broker”).  Tenant
agrees to indemnify and save Landlord harmless against the claims (whether or
not justified) of any broker or agent (other than the Broker) alleging dealings
with Tenant.

 

24.02.              Landlord represents to Tenant that it has dealt
with no broker in connection with this transaction other than the Brokers and
Landlord agrees to pay said Broker’s commission pursuant to separate agreement.

 

36

 

ARTICLE 25

 

SUBORDINATION

 

25.01.              Subject to the conditions set forth in Sections
25.02 and 25.03, this Lease is and shall be subject and subordinate to any
ground or underlying lease hereinafter collectively called “Underlying Lease”)
which may now or hereafter affect the Building or the Land and to any
amendment, modification, renewal or extension of any such Underlying Lease. Subject
as aforesaid this Lease is also subject and subordinate to all mortgages which
may now or hereafter affect any Underlying Lease or the Land and/or Building
and to all renewals, modifications, amendments, consolidations, replacements or
extensions thereof. The landlord or lessor under any Underlying Lease is
referred to in this Lease as “Overlandlord”. This clause shall be
self-operative and no further instrument of subordination shall be required by
any Overlandlord or mortgagee. In confirmation of such subordination, Tenant
without cost or charge to Landlord shall execute promptly any certificate or instrument
of subordination that Landlord may reasonably request. Tenant hereby
constitutes and appoints Landlord the Tenant’s attorney-in-fact for purposes of
this Article only to execute any such certificate or certificates or any
such instrument or instruments for and on behalf of Tenant if Tenant shall fail
or refuse to execute the same for fifteen days after demand.

 

25.02.              The subordination of this Lease to Underlying Leases
in accordance with Section 25.01 is subject to the express conditions
that, so long as this Lease shall be in effect, in the event of termination of
the term of any Underlying Lease, by re-entry, notice, summary proceedings or other action or proceeding, or
if the term of such Underlying Lease shall otherwise terminate or expire before
the termination or expiration of the term of this Lease, Tenant shall recognize
and attorn to the then owner of the fee or lessor of such Underlying Lease and
this Lease shall continue in full force and effect as a direct lease between
Tenant and the then owner of the fee or lessor of such Underlying Lease, as the
case may be, upon all of the obligations of this Lease, except that if such
owner or lessor is not related to Landlord, said owner or lessor shall not (i)
be liable for any previous act or omission of Landlord under this Lease; (ii)
be subject to any defenses or offsets that Tenant may have against any prior
landlord (including, without limitation, the then-defaulting landlord); (iii)
be bound by any prepayment of more than one month’s rent; (iv) be bound by any
construction obligations of any prior landlord or by any covenant to undertake
or complete any construction or reconstruction of any portion of the Building,
including that portion leased to Tenant under this Lease; (v) be bound by any
obligation to make any payment to Tenant; or (vi) be bound by any set-off or
counterclaim that may have accrued to Tenant against any prior landlord. In
such event, upon written request of said owner or lessor, or his successors or
assigns, Tenant shall enter into an agreement attorning to said owner or lessor,
or his successors or assigns upon all of the obligations of this Lease.

 

25.03.              The subordination of this Lease to the liens of
mortgages in accordance with Section 25.01 is subject to the express
condition that so long as this Lease shall be in effect Tenant shall recognize
and attorn to the holder of any such mortgage who becomes the owner of the fee
or the assignee of any Underlying Lease, or the lessee of any other lease given
in substitution therefor, or if the Land or the Building shall be sold as a
result of any action or proceeding to foreclose such mortgage, if this Lease
shall not have been terminated, this Lease shall continue in full force and
effect as a direct lease between Tenant and the then owner of the fee or the
then lessee of such Underlying Lease, or the lessee of any other least given

 

37

 

in substitution therefor, or
such purchaser of the Land or Building, as the case may be, upon all of the
obligations of this Lease, except that if such owner, lessee, or purchaser is
not related in any way to Landlord such owner, lessee or purchaser shall not
(i) be liable for any previous act or omission of Landlord under this Lease,
(ii) be subject to any defenses or offsets that Tenant may have against any
prior Landlord (including, without limitation, the then-defaulting landlord), (iii)
be bound by any prepayment of more than one month’s rent, (iv) be bound by any
construction obligations of any prior landlord or by any covenant to undertake
or complete any construction or reconstruction of any portion of the Building,
including that portion leased to Tenant under the Lease, (v) be bound by any
obligation to make any payment to Tenant, or (vi) be bound by any set-off or
counterclaim that may have accrued to Tenant against any prior landlord. In
such event, upon written request of said owner or lessor, or his successors or
assigns, Tenant shall enter into an agreement attorning to said owner or
lessor, or his successors or assigns, upon all of the obligations of this Lease.

 

25.04.              In the event of any act or omission by Landlord
which would or may give Tenant the right to terminate this Lease or to claim a
partial or total eviction, Tenant will not exercise any such right until

 

(a)         it has given written notice of any such actor omission to the holder of any
leasehold mortgage or of any fee mortgage and to Landlord and the lessor under
any Underlying Lease or leases whose names and addresses previously have been
furnished to Tenant by giving such notice, addressed to such holders and
Landlord or lessors at the last addresses so furnished, and

 

(b)        ten (10) days shall have elapsed following
such giving of notice of such act or omission during which the parties to whom
such notice has been given, or any of them, have not commenced with reasonable
diligence the remedying of such act or omission.

 

25.05.              If, in connection with obtaining temporary or permanent
financing for the Land and/or Building, or any Underlying Lease, any lender
shall request reasonable modifications of this Lease as a condition to such
financing, Tenant agrees that Tenant will not unreasonably withhold, delay or
defer the execution of an agreement of modification of this Lease provided such
modifications do not increase the financial obligations of Tenant hereunder,
adversely affect Tenant’s rights under this Lease or adversely affect the
leasehold interest hereby created.

 

ARTICLE 26

 

LEGAL PROCEEDINGS

 

26.01.              Landlord and Tenant hereby waive, to the
extent such waiver is not prohibited by law, the right to a jury trial in any
action, summary proceeding or legal proceeding between or among the parties
hereto or their successors arising out of this Lease or Tenant’s occupancy of
the Demised Premises or Tenant’s right to occupy the Demised Premises.

 

26.02.              Tenant hereby waives, to the extent such
waiver is not prohibited by law, the right to interpose a counterclaim in any
summary proceeding instituted by Landlord against Tenant or in any action
instituted by Landlord for unpaid rent or additional rent under this Lease.

 

38

 

ARTICLE 27 

 

SURRENDER OF PREMISES

 

Upon the
expiration or other termination of the term of this Lease, Tenant shall quit
and surrender the Demised Premises in good order and condition, ordinary wear
and tear and damage by fire, other casualty or the elements excepted, and shall
remove all its property therefrom, except as otherwise provided in this Lease.
Tenant’s obligation to observe or perform this covenant shall survive the
expiration or other termination of the term of this Lease.

 

ARTICLE 28 

 

RULES AND REGULATIONS

 

28.01.              Tenant,
its servants, employees, agents, visitors and licensees shall observe
faithfully and comply strictly with the rules and regulations set forth in Exhibit C attached hereto and made a
part hereof.

 

 

28.02.              Landlord
shall have the right from time to time during the term of this Lease, to make
changes in, and additions to, the rules and regulations set forth in Exhibit C provided
that such changes and additions are applicable to all other office tenants in
the Building and

 

(i)                  are necessary or
desirable for the safety, care or appearance of the Building or the
preservation of good order therein, or the operation or maintenance of the
Building, or the equipment thereof, or the comfort of tenants or other
occupants in the Building,

 

(ii)                 do not
unreasonably affect the conduct of Tenant’s business in the Demised Premises;
provided, further, that in the case of any conflict or inconsistency between the
provisions of this Lease and any of said rules and regulations as originally
promulgated or as changed, the provisions of this Lease shall control. Said
rules and regulations, as changed in accordance with this Section from
time to time, are hereinafter called the “Rules and Regulations”.

 

28.03.              If
Tenant shall dispute the reasonableness of any change in the Rules and
Regulations, the dispute shall be determined by Judicial Determination. The
right to dispute the reasonableness of any change in the Rules and Regulations
upon Tenant’s part shall be deemed waived unless the same is asserted by
service of a notice upon Landlord within thirty (30) days after notice is given
to Tenant of the adoption of any such change.

 

28.04.              Landlord
shall use reasonable efforts to enforce the Rules and Regulations, but Landlord
shall not be liable to Tenant for violation of the same by tenants or other occupants
of the Building, or their servants, employees, agents, visitors or licensees.
Landlord shall not enforce such rules
and regulations in a discriminatory manner as among Tenant and other tenants in
the Building.

 

28.05.              Any
dispute between the parties hereto with respect to application or
interpretation of the Rules and Regulations shall be determined by Judicial Determination.

 

39

 

ARTICLE 29 

 

SUCCESSORS AND ASSIGNS

 

29.01.              The
covenants, conditions and agreements contained in this Lease shall bind and
inure to the benefit of the parties hereto and their respective heirs, legal representatives,
successors and, except as otherwise provided herein, their assigns.

 

29.02.              The
term “Landlord” wherever used in this Lease shall be limited to mean and
include only the owner or owners at the time in question of the Building or the
tenant under an Underlying Lease affecting the Land and/or the Building, to
whom this Lease has been assigned, or an Overlandlord if such Overlandlord
enters into possession, or a mortgagee in possession so that in the event of
any sale, assignment or transfer of the Land and/or Building, or of such
Underlying Lease, such owner, tenant under such Underlying Lease or
Overlandlord or mortgagee in possession shall thereupon be released and
discharged from all covenants, conditions and agreements of Landlord hereunder;
but such covenants, conditions and agreements shall be binding upon each new
owner, tenant under such Underlying Lease, Overlandlord or mortgagee in
possession for the time being of the Building, until sold, assigned or
transferred.

 

29.03.              Wherever
used in this Lease in connection with any of Tenant’s obligations hereunder,
and except as otherwise provided herein,
the term “Tenant” shall mean and include, at any given time. Tenant herein
named and each successor to or assignee of any interest of Tenant herein named under
this Lease pursuant to the terms of this Lease. In any other context, the term “Tenant”
shall be limited to mean only the tenant in possession at the time in question
of the Demised Premises.

 

ARTICLE 30

 

NOTICES

 

Any notice, request, demand or
communication permitted or required to be given by the terms and provisions of
this Lease, or by any law or governmental regulation, either by Landlord to
Tenant or by Tenant to Landlord, shall be in writing. Unless otherwise required
by such law or regulation such notice, request or demand shall be given when
the same shall have been sent by hand, by a reputable overnight courier service
or deposited in a securely closed postpaid wrapper by certified or registered
mail, return receipt requested, in a United States Government general or branch
post office, addressed if for Tenant (1) at the Demised Premises, or (2) until
Tenant shall have moved its offices to the Demised Premises, addressed to
Tenant at its address as stated on the first page of this Lease, with a copy to
Martin Danoff, Esq., c/o Ohrenstein & Brown, 230 Park Avenue, New York, NY
10169, and if for Landlord, addressed to Landlord, c/o The Galbreath Company,
L.P., 437 Madison Avenue, New York, New York 10022, attention:  Barry Lewen, with a copy to
Fischbein-Badillo-Wagner-Itzler, 909 Third Avenue, 17th Floor, New York, New
York 10022, Attention:  Hugh M. Heller,
Esq.  Such notice, request or demand shall
be deemed to have been served upon the earlier of actual receipt or first attempted
delivery. Either party may, by notice sent in like manner as aforesaid,
designate a different address or addresses for notices, requests, demands or
communications to it.

 

40

 

ARTICLE 31 

 

NO WAIVER; ENTIRE AGREEMENT

 

31.01.              The
failure of either party hereto to seek redress for violation of, or to insist
upon the strict performance of, any covenant or condition of this Lease, or any of the Rules and Regulations set
forth herein or hereafter adopted by Landlord, shall not prevent a subsequent
act, which would have originally constituted a violation hereof, from having all
the force and effect of an original violation. The receipt by Landlord or the
payment by Tenant of rent with knowledge of the breach of any covenant of this
Lease shall not be deemed a waiver of such breach. No provision of this Lease
shall be deemed to have been waived by either party unless such waiver be in
writing and signed by the party to be charged. No payment by Tenant or receipt
by Landlord of a lesser amount than the monthly rent herein stipulated shall be
deemed to be other than on account of the earliest stipulated rent, nor shall
any endorsement or statement on any check or any letter accompanying any check
or payment as rent be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to Landlord’s right to recover
the balance of such rent or pursue any other remedy in this Lease provided.

 

31.02.              This
Lease with the Exhibits annexed hereto contains the entire agreement between
Landlord and Tenant and any executory agreement
hereafter made between Landlord and Tenant shall be ineffective to change,
modify, waive, release, discharge, terminate or effect an abandonment of this
Lease, in whole or in part, unless such executory agreement is in writing and
signed by the party against whom enforcement of the change, modification,
waiver, release, discharge, termination or the effecting of the abandonment is
sought.

 

31.03.              If
any term or provision of this Lease shall to any extent be invalid or
unenforceable, the remainder of this Lease shall not be affected thereby and
the balance of the terms and provisions of this Lease shall be valid and
enforceable to the fullest extent either as specified hereunder or as permitted
by law.

 

ARTICLE 32 

 

INDEX
AND CAPTIONS; ESTOPPEL CERTIFICATE

 

32.01.              The
index preceding this Lease and the captions of Articles in this Lease are
inserted only as a matter of convenience and for reference and they in no way
define, limit or describe the scope of this Lease or of the intent of any
provision thereof.

 

32.02.              Each
party hereto covenants and agrees, at any time and from time to time, as
requested by the other party, upon not less than ten (10) days’ prior notice,
to execute, acknowledge and deliver to the other a statement in writing certifying
that this Lease is unmodified and in full force and effect and constitutes the
only lease or agreement between Landlord and Tenant affecting the Premises (or
if there have been modifications or other agreements, that the same is in full
force and effect as modified and stating the modifications or other agreements),
certifying the dates to which the fixed rent and all items of additional rent
and other charges, if any, have been paid, the commencement and expiring dates
of the Lease, stating whether or not, said party is in default in the
performance of any of its obligations under this Lease, and, to the best knowledge
of the signer, the other party is in default in

 

41

 

performance of
any of its obligations under this Lease, and, if so, specifying each such
default of which the signer may have knowledge, stating whether Tenant is
entitled to any free rent or other concessions, offsets, rebates, abatements,
benefits or inducements, stating whether Tenant is entitled any renewal,
expansion, or purchase options or rights of first refusal, stating whether or
not any rental payment has been made for more than one month in advance, and
stating whether or not said party has any outstanding claim, offset or defense
it could assert against the payment of rent or enforcement or any of the terms
of the Lease, it being intended that any such statement delivered pursuant
hereto may be relied upon by others with whom the party requesting such
certificate may be dealing.

 

32.03.              This
Lease shall not be deemed or construed to create or establish any relationship
of partnership or joint venture or similar relationship or arrangement between
Landlord and Tenant hereunder.

 

ARTICLE 33 

 

INABILITY TO PERFORM

 

This Lease and
the obligation of Tenant to pay rent or additional rent hereunder and perform
and comply with all of the other covenants and agreements hereunder on the part
of Tenant to be performed and complied with shall in no wise be affected,
impaired or excused because of Landlord’s delay or failure to perform or comply
with any of the covenants or provisions hereunder on the part of Landlord to be performed or complied
with, nor because Landlord is unable to fulfill any of its obligations under
this Lease or to supply or is delayed in supplying any service expressly or
impliedly to be supplied or is unable to make or is delayed in making any
repair, additions, alterations or decorations or is unable to supply or is
delayed in supplying any equipment or fixtures if Landlord is prevented or
delayed from so doing by reason of strike or labor troubles or any other cause
whatsoever beyond Landlord’s reasonable control including, but not limited to,
governmental preemption in connection with a national emergency or by reason of
any rule, order or regulation of any department or subdivision thereof of any
government agency or by reason of the conditions of supply and demand which
have been or are affected by war or other emergency provided that Landlord
shall in each instance exercise reasonable diligence to effect performance when
and as soon as possible.

 

ARTICLE 34 

 

NO REPRESENTATIONS BY
LANDLORD

 

Landlord or Landlord’s
agents have made no representations or promises with respect to the Building,
the Land or the Demised Premises except as herein expressly set forth and no
rights, easements or licenses are acquired by Tenant by implication or
otherwise except as expressly set forth in the provisions of this Lease.

 

ARTICLE 35 

 

CONSENTS,
JUDICIAL DETERMINATION

 

35.01.              Wherever
in this Lease it is provided that either party shall not unreasonably withhold
or delay consent or approval, such consent
or approval (hereinafter referred to

 

42

 

collectively
as “consent”) shall also not be unreasonably delayed. If a reply to a request
for consent expressly granting or denying such consent is not given, the
requested consent shall be deemed to have been denied.

 

35.02.              A
determination by a court of competent jurisdiction in an action for declaratory
judgment or such other action or proceeding as may be appropriate under the circumstances
is herein referred to as a “Judicial Determination”.

 

35.03.              Any
dispute between the parties hereto as to whether or not a matter or thing or
the conduct of one of the parties hereto has been, or is, “reasonable” or “not unreasonable”
as respects a matter covered by this Lease concerning which the word “reasonable”
or “reasonably” or “not unreasonably” is used in this Lease to describe such
matter, thing or conduct, shall be determined by Judicial Determination.

 

35.04.              The
sole remedy to which either party shall be entitled as respects any dispute
which is to be resolved by Judicial Determination pursuant to this Article shall
be a judgment as to whether or not the matter, thing or conduct was not “reasonable”
as respects the subject matter of
such Judicial Determination. In no event shall either party hereto entitled to any
money damages by reason of any claim that the other party acted unreasonably as
respects any matter, thing or conduct with respect to which Judicial
Determination is provided for in this Article and each party specifically
waives the right to any such money damages or other remedies.

 

ARTICLE 36 

 

SECURITY

 

36.01.              Tenant
has deposited with Landlord the sum of $14,177.50 as security for the full and
faithful performance and observance of Tenant
of Tenant’s covenants and obligations under this Lease.  If Tenant defaults 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
rent, 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
rent 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 Demised 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 any applicable grace period. 
Except in connection with a permitted assignment of this Lease, Tenant
shall not assign or encumber or attempt to assign or encumber the security
deposited herein 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.

 

43

 

36.02.              Landlord
shall deposit the security in an interest bearing account in a New York bank
and the interest earned thereon, less one
(1%) percent of the principal of the security deposit which Landlord may retain
as an administrative charge, shall be paid to Tenant annually, provided Tenant
is not then in default.

 

36.03.              In
lieu of the cash security deposit provided for in Sections 36.01 and 36.02
hereof, Tenant may deliver to Landlord, and, shall, except as otherwise
provided herein, maintain in effect at all times during the term hereof, an irrevocable
letter of credit, in form and substance reasonably satisfactory to Landlord in
the amount of the required security deposit issued by a banking corporation
reasonably satisfactory to Landlord and having its principal place of business
or its duly licensed branch or agency in the State 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.  Except as otherwise provided herein, 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 hereinafter referred to as a “Security Letter”) no later than
forty-five (45) 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.  If Tenant shall fail to obtain any
replacement of a Security Letter within the time limits set forth in this Section 36.03,
Landlord may draw down the full amount of the existing Security Letter and
retain the same as security hereunder. 
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 36,
each Security Letter shall provide that the full amount thereof may be drawn
down by Landlord upon the presentation to the issuing bank of Landlord’s draft
drawn on the issuing bank accompanied by a statement signed by an officer of
Landlord that Tenant is in default under the Lease or that Tenant has failed to
obtain a replacement of the Security Letter on a timely basis, as the case may
be.

 

36.04.              In
the event Tenant defaults in respect to any of the terms, provisions, covenants
and conditions of this Lease, including, but not limited, the payment of rent
and additional rent, Landlord may use, apply or retain the whole or any part of
the security so deposited to the extent required for the payment of any rent
and additional rent or any other sum as to which Tenant is in default or for
any such 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 damages or deficiency accrued
before or after summary proceedings or other re-entry by Landlord.

 

36.05.              In
the event that Tenant defaults in respect of any of the terms, provisions,
covenants and conditions of the Lease and Landlord utilizes all or any part of
the security but does not terminate this Lease as provide in Article 18
hereof, Landlord may, in addition to exercising its rights as provided in subsection 36.02,
retain the unapplied and unused balance of the principal amount of the 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 balance to the extent required for payment of rent,
additional rent, or any other sum as to which Tenant is in

 

44

 

default or for
any such 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 applies or retains
any portion or all of the security delivered hereunder, Tenant shall forthwith
restore the amount so applied or retained so that at all times the amount
deposited shall be not less than the security required hereunder.

 

36.06.              In
the event that Tenant shall fully and faithfully comply with all of the terms,
provisions, covenants and conditions of this Lease, the security shall be
returned to Tenant after the date fixed as the end of the Lease and after
delivery of entire possession of the demised premises to Landlord.  In the event of a sale of the Land and
Building or leasing of the Building, landlord shall have the right to transfer
any interest it may have in the security to the vendee or lessee and Landlord
shall thereupon be released by Tenant from all liability for the return of such
security, provide such vendee or lessee assumes any responsibilities of
Landlord with respect to such security, and Tenant agrees to look solely to the
new landlord for the return of said security; and it is agreed that the
provisions hereof shall apply to every transfer or assignment made of the
security to a new landlord.  Tenant
further covenants that it will not assign or encumber or attempt to assign or
encumber the monies deposited herein as security and that neither Landlord nor
its successors or assigns shall be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance.

 

ARTICLE 37 

 

MISCELLANEOUS

 

37.01.              Tenant
shall have eight (8) listings on the Building’s tenant directory. If the
capacity of said directory is expanded in the future, Tenant shall, to the extent practicable, be allowed to
use a pro rata share of such expanded capacity. Any name changes after Tenant’s
initial occupancy of the Demised Premises shall be at Tenant’s expense.

 

ARTICLE 38 

 

ENVIRONMENTAL

 

38.01.              Tenant
covenants and agrees with Landlord that:

 

(a)       Tenant
will not suffer, cause or permit the treatment or disposal of Hazardous
Substances (or as hereinafter defined) in, at, on or under the Building, Land
or Demised Premises;

 

(b)       Tenant
will not suffer, cause or permit the handling, use, processing or storage of
Hazardous Substances in, at, on or under the Building or Demised Premises,
except in accordance with proper housekeeping practices and in compliance with
all Environmental Laws;

 

(c)       Tenant
shall comply with all Environmental Laws in connection with its occupancy or
use of the Demised Premises;

 

(d)       Tenant
shall promptly notify Landlord in the event of the release, discharge, leak or
spill of any Hazardous Substance in, at, on or under the Building, Land or
Demised Premises; and

 

45

 

(e)       Tenant
shall deliver promptly to Landlord (i) copies of any documents received from
the United States Environmental Protection Agency or any other federal, state,
county or municipal environmental, health or safety agency concerning Tenant’s
business or operations in or at the Building and Demised Premises, and (ii)
copies of any documents submitted by Tenant to the United States Environmental
Protection Agency or any other federal, state, county or municipal
environmental, health or safety agency concerning its business or operations in
or at the Building or Demised Premises.

 

38.02.              The
Tenant agrees to indemnify, defend, and hold harmless Landlord from and against
any and all liabilities, including, but not limited to, all costs of
investigation, monitoring, legal representation, remedial response, removal, restoration
or permit acquisition, which may now or in the future be undertaken, suffered,
paid, awarded, assessed or otherwise incurred by Landlord or any other person
or entity as a result of the presence of, release of or threatened release of a
Hazardous Substance on, in, under or near the Demised Premises by Tenant, except
for such liability as shall be incurred as a result of the actions of Landlord.
The liability of the Tenant to the Landlord under the covenants of this Section 38.03
shall survive termination of this Lease regardless of the means of such termination.

 

38.03.              (a)
“Environment” includes any and all of the following: any water, including but
not limited to, surface water, ground water, and water vapor, any land,
including land surface and subsurface, stream sediments, air, fish, wildlife, plants,
and all other natural resources and environmental media.

 

(b)       “Environmental
Laws” means all federal, state and local environmental, land use, zoning,
health, chemical use, safety and sanitation laws, statutes, ordinances, regulations,
codes and rules relating to the protection of the Environment and/or governing
the use, storage, treatment, generation, transportation, processing, handling,
production or disposal of Hazardous Substances and the policies, guidelines,
procedures, interpretations, decisions, orders and directives of federal, state
and local governmental agencies and authorities with respect thereto.

 

(c)       “Hazardous
Substances” means, without limitation, any explosive, radon, radioactive
material, asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyl, petroleum and petroleum products, methane, hazardous material,
hazardous waste, hazardous or toxic substance and any other material defined as
a hazardous substance in Section 101(14) of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended, 42
U.S.C. Section 9601(14), or regulations adopted pursuant thereto.  Notwithstanding the foregoing, Hazardous
Materials shall not include any such materials which are used in the ordinary
course of Tenant’s business or the maintenance or repair of the Demised
Premises, provided all such materials are used, stored and disposed of in
accordance with applicable law, manufacturers specifications and industry
standards.

 

ARTICLE 39 

 

SUITES 1601 AND 1611

 

39.01               (a)  Landlord shall notify Tenant in writing (i)
when it has received written notice that Lee Gross the tenant of Suite 1601 in
the Building intends to vacate
said space (“1601 Space”) or (ii) when it serves written notice on Lee Gross
terminating its month-to-month tenancy or (iii) exercising any

 

46

 

any cancellation right held by Landlord, in
any future lease with Gross.  Landlord
agrees that if it enters into any future lease with Gross such lease shall, inter
alia, provide that Landlord has a right to cancel it on 90 days’ prior
notice.  Such notice to Tenant shall
include an offer by Landlord to rent the 1601 Space to Tenant at a rent which,
if such notice is given in the first two years of the term of this Lease shall
be at the rent stipulated in Section 3.01 hereof, and if at any time
thereafter, shall be at the rent equal to the then fair market rent for said
1601 Space, and for a term that is co-terminus with the unexpired term of the
Lease and otherwise on terms and conditions contained in Landlord’s then
customary form of lease.  Thereafter,
Tenant shall have 60 days from the date of such notice (as to which time period
time shall be of the essence) to accept or decline such offer in writing and if
Tenant declines such offer or it fails to timely respond Tenant shall have no
further rights with respect to the 1601 Space and Landlord shall be free to
rent to any other party on such terms and conditions as it deems advisable.

 

(b)  Upon 90 days prior written notice from
Tenant, Landlord will exercise any rights it may have to terminate the tenancy
or occupancy of Lee Gross as described in (ii) or (iii) of (a) this section 39.01,
as the case may be, provided that Tenant contemporaneously with, and as a
condition thereto, enters into a lease with Landlord for the 1601 Space
effective upon Gross vacating it, at its then fair market rent, for a term co-terminous
with the term of this Lease and otherwise on the terms and conditions of
Landlord’s then customary form of lease.

 

Tenant
acknowledges that Landlord will not have possession of the 1601 Space at the
time such lease is executed, and may not obtain the same for an extended period
of time. Tenant further acknowledges that in exercising its rights of
cancellation pursuant to Tenant’s notice, Landlord is not making any
representations or warranties as to when the 1601 Space will become vacant.

 

39.02       (a)  Landlord shall notify Tenant in writing when
it intends to relocate the Building Superintendent from Suite 1611 in the
Building (“1611” Space).  Such notice to
Tenant shall include an offer by Landlord to rent the 1611 Space to Tenant at a
rent which, if such notice is given in the first two years of the term of this
Lease, shall be at the rent stipulated in Section 3.01 hereof, and if at
any time thereafter, shall be at
the rent equal to the then fair market rent for the 1611 Space and for a term
co-terminus with the unexpired term of Lease and otherwise on terms and
conditions contained in Landlord’s then customary form of lease.  Thereafter, Tenant shall have 60 days from
the date of such notice (as to which time period time shall be of the essence)
to accept or decline such offer and if it declines such offer it fails to
timely respond Tenant shall have no further rights with respect to the 1611
Space and Landlord shall be free to rent to any other party on such terms and
conditions as it deems advisable.

 

(b)       Upon
90 days prior written notice from Tenant, Landlord will exercise any rights it
may have to terminate the tenancy or occupancy of the Superintendent in the
1611 Space, provided that Tenant contemporaneously with, and as a condition
thereto, enters into a lease with Landlord for the 1611 Space effective upon
the Superintendent vacating it, at its then fair market rent, for a term
co-terminous with the term of this Lease and otherwise on the terms and
conditions of Landlord’s then customary form of lease.

 

Tenant
acknowledges that Landlord will not have actual possession of the 1611 Space at
the time the lease is executed, and may not obtain the same for an extended
period of time.

 

47

 

Tenant further
acknowledges that in exercising its rights to terminate the tenancy or occupancy
of the Superintendent pursuant to Tenant’s notice, Landlord is not making any
representations or warranties as to when the 1611 Space will become vacant.

 

ARTICLE 40 

 

RELOCATION

 

40.01       Landlord
shall have the right at any time during the term of this Lease on 90 days prior
written notice to Tenant, to relocate Tenant at Landlord’s expense from the
Demised Premises and/or Suites 1601 and 1611 (as the case may be) to space in
the Building comparable to the space Tenant then occupies but in no event below
the eighth floor.  As used herein, “space
in the Building comparable to the space Tenant then occupies” shall mean said
relocation space shall include but not be limited to, the following to the
extent it exists in the space Tenant is being moved from on the date of said
relocation: moving existing furniture and equipment, installation of telephone
and faxes, wiring for computers, carpeting and padding, blinds and window
treatments, fresh painting and, if needed, touch-up plastering and wall
papering, removal and relocation of built-in furniture, shelves and countertops
to the extent any exists at the time of relocation.  In addition, Landlord will reimburse Tenant
for new stationery not to exceed the sum of $700 and if at the time of said
relocation Tenant is occupying the entire 16th Floor, said relocation space
will be near the elevator provided Tenant at the time of relocation is the sole
tenant of the 16th floor.

 

48

 

IN WITNESS
WHEREOF, Landlord and Tenant have respectively signed and sealed this Lease as
of the day and year first above written.

 

 

	
  Landlord:

  	
  366 Madison, Inc.

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ [ILLEGIBLE]

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
  Tenant:

  	
  Silipos, Inc.

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ Joel E. Bickel

  	
   

  	 

	
   

  	
   

  	
  Name:

  	
  Joel E. Bickel

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Treasurer/CEO

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tenant’s Federal Identification No:

  	 

	
   

  	
   

  	
  133489934

  	
   

  	 

								

 

49

 

EXHIBIT A

 

1.             LANDLORD’S WORK

 

The Demised
Premises shall be delivered to Tenant on the Commencement Date vacant, in broom
clean and otherwise “as is” condition, except that Landlord, at its own cost
and expense shall perform or cause to be performed the following work:

 

a.          Renovation
of the common corridor in accordance with building standard.

 

b.         Painting
of the bathrooms on the 16th floor and furnishing and installing new bulbs and
light fixtures and new blinds in said bathrooms.

 

c.          Landlord
will replace the light bulbs in Suite 1607.

 

d.         Landlord
will caulk and fix the windows in the Demised Premises to make operable and
will balance the air conditioning.

 

e.         Repair
leaks in wall.

 

Landlord shall
not perform any work in the Demised Premises except as set forth above.

 

2.             TENANT’S WORK

 

Tenant at its
own cost and expense will timely alter, modify and construct the Demised
Premises in accordance with the Preliminary Plans initialed by the parties
hereto, dated 3/10/95 and in possession of Landlord (“Tenant’s Work”).

 

Tenant’s Work
should be performed in compliance with the Preliminary Plans described below,
if any, and in compliance with the provisions of this Lease including
specifically Article 5 and Article 6. 
Tenant may request Landlord or its contractor to construct Tenant’s
Work.  In the event Tenant shall elect to
hire an outside contractor, it shall bid the general contracting for such work
to two duly licensed contractors approved by Landlord, which approval should
not be unreasonably withheld, and shall request a similar proposal from
Landlord’s contractor.  In the event the
proposal by Landlord’s contractor shall be offered at a cost less than Tenant’s
contractor, Tenant shall utilize Landlord’s contractor for the construction of
Tenant’s Work in accordance with such proposal and the terms and conditions
herein.

 

3.            LANDLORD’S CONTRIBUTION

 

Provided that
Tenant is not in default hereunder, Landlord agrees to contribute to Tenant up
to the sum of $35,489 (Thirty-five thousand four hundred eighty-nine dollars),
hereinafter “Landlord’s Contribution” to be applied only towards Tenant’s
Work.  Any cost or expense in excess of
this amount shall be borne and paid for by Tenant.

 

(a)            As
Landlord’s Contribution, Landlord will reimburse Tenant for sums actually
incurred by Tenant in connection with Tenant’s Work in respect of Tenant’s
initial occupancy (and not for any renovations or other substantial or material
work

 

50

 

after Tenant
first occupies the Premises for business), provided, however, that (i) such
reimbursement (hereinafter referred to as the “Construction Reimbursement”)
shall in no event exceed the lesser amount of (x) the aggregate cost and
expense actually incurred by Tenant in connection with Tenant’s Work, and (y)
$35,489 and (ii) Tenant is not, at the time of such reimbursement, in breach or
default (after notice and the expiration of any applicable cure period) under
any of the monetary or material non-monetary terms, covenants, provisions or
conditions of the Lease on its part to be observed, performed or complied with.

 

(b)             The
Construction Reimbursement shall be made by Landlord in the following manner
and subject to the following conditions:

 

(i)       Promptly
upon completion of a portion of Tenant’s Work, Tenant shall submit to Landlord:

 

(w)      paid
contractors’ invoices for all work done and all supplies furnished in
connection with such Tenant’s Work; and

 

(x)         a
detailed breakdown of the aggregate cost of all Tenant’s Work completed to
date; and

 

(ii)      Not
more frequently than twice during each thirty (30) day period after the
commencement of Tenant’s Work, Tenant may submit to Landlord Tenant’s
application for reimbursement of the Construction Reimbursement with respect to
the portions of Tenant’s Work completed for the period prior to the submission
of Tenant’s application for which Landlord has not paid Tenant a “Construction
Payment” (as hereinafter defined), together with the items set forth in
subparagraph (i) hereof (each such application, together with the items set
forth in said subparagraph (i), being hereinafter referred to as a “Monthly
Reimbursement Submission”) and, within ten (10) business days (as defined in
the Lease) after Landlord receives a complete Monthly Reimbursement Submission,
Landlord shall pay to Tenant that portion of ninety (90%) percent of the
Construction Reimbursement reflected in such Monthly Reimbursement Submission
(a “Construction Payment”), until ninety (90%) percent of the Construction
Reimbursement has been paid.  The
remaining ten (10%) percent of the Construction Reimbursement shall be paid to
Tenant within fifteen (15) days after completion of the work. Notwithstanding
anything contained herein to the contrary, in no event shall Tenant or any of
its contractors be entitled to any payment pursuant to the terms of this
subdivision (ii) or any reduction in fixed rent, or credit against, or application
to, fixed rent, either (x) as long as Tenant shall then be in breach or default
(after notice and the expiration of any applicable cure

 

51

 

period) of any of the
monetary or material non-monetary terms, covenants and conditions of the Lease
on its part to observe, perform or comply with or (y) in excess of $35,489.00.

 

(c)             All of Tenant’s Work shall be performed
subject to, and in accordance with, the terms, covenants, provisions and
conditions of the Lease, and nothing herein contained shall be construed as a
waiver by Landlord of its right to approve such work or a waiver of any of the
other terms, covenants, provisions or conditions of the Lease relating thereto.

 

(d)            Landlord’s obligation to reimburse or pay the Construction Reimbursement
shall benefit only Tenant, and neither such obligation nor any other provision hereof
shall benefit any of Tenant’s contractors, subcontractors, laborers, suppliers
or materialmen, or any other person or entity, or entitle any of the foregoing
enforce any provision of this agreement against Landlord or any person or
entity claiming by, through or under Landlord, including, without limitation,
any of Landlord’s lenders.

 

4.             PRELIMINARY PLANS

 

Initialed by Landlord and
Tenant dated 3/10/95 and in possession of Landlord.

 

52

 

EXHIBIT B

 

BASE BUILDING CLEANING
SPECIFICATIONS

SCOPE OF WORK

 

A.         GENERAL OFFICE - NIGHTLY

 

1.             All
composite or resilient flooring to be swept using approved dust-check type of
mop.

 

2.             All
carpeting and rugs to be vacuum cleaned.

 

3.             Hand
dust all work areas and wipe clean all furniture, fixtures and window sills,
doors, fire extinguisher, partitions, chairs, structural and built-in
furniture, ledges up to height of five feet, wash sills when necessary.  Papers and folders not to be moved.

 

4.             Empty
and clean all waste receptacles and remove waste paper and waste materials to
designated area.

 

5.             Dust
exterior of all waste disposal cans and baskets: damp-dust as necessary.

 

6.             Wash
clean all water fountains and coolers.

 

GENERAL OFFICE - WEEKLY

 

7.             Hand
dust all door and other ventilating louvers within reach, as necessary.

 

8.             Dust
all vinyl or wood bases.

 

GENERAL OFFICE - MONTHLY

 

9.             Dust
and vacuum all conditioning diffuses and return grills.

 

GENERAL OFFICE - QUARTERLY

 

10.           Do
all high dusting which includes the following: all pictures, frames, charts,
inside of all door jams, graphs and similar wall hangings not reached in
nightly cleaning.

 

53

 

B.         GENERAL BUILDING RESTROOM SERVICES PUBLIC * -
NIGHTLY

 

11.           Sweep
and wash all lavatory floors using proper disinfectants.

 

12.           Scour,
wash and disinfect all basins, bowls and urinals throughout all lavatories and
remove stains as required.

 

13.           Wash
and disinfect all toilet seats.

 

14.           Empty
paper towel receptacles and transport wastepaper to designated area.  Towels, toilet tissue and soap to be
restocked and supplied by Contractor.

 

15.           Wash
and polish all mirror, dispensers, faucets, flushometers and brightwork with
non-scratch disinfectant cleaner.  Wipe
dry all sinks.

 

16.           Empty
sanitary disposal receptacles.

 

17.           Restock
all sanitary napkins and tampon dispensers from Contractor’s stock, as
required.  Supplies for and proceeds from
this service are the sole responsibility of the Janitorial Contractor. Maintenance
and repair of the machine shall be of the Owner.

 

GENERAL BUILDING RESTROOM
SERVICES PUBLIC - WEEKLY

 

18.           Dust
all low reach areas.

 

GENERAL BUILDING RESTROOM
SERVICES PUBLIC - MONTHLY

 

19.           Thoroughly
wash all wall tile, stall surfaces and counters.

 

GENERAL BUILDING RESTROOM
SERVICES PUBLIC - QUARTERLY

 

20.           Dust
all high reach areas including, but not limited to, mirror tops, partition tops
and edges, air conditioning diffuses and return air grills.

 

* -           Cleaning
solution must not contain chlorinated bleach or dyes.

 

WINDOW
CLEANING

 

SEMI ANNUALLY 

 

A.                          Exterior Window Cleaning.

 

Clean all exterior windows inside and out.

 

54

 

EXHIBIT C

 

RULES AND REGULATIONS

 

I.              Except
as contemplated in the Lease, Tenant shall not:

 

1.             Obstruct,
encumber or use, or allow or permit any of its employees, agents, licensees or
invitees to congregate in or on, the sidewalks, driveways, entrances, passages,
courts, arcades, esplanade areas, plazas, elevators, vestibules, stairways,
corridors or halls of the Building, outside of the Demised Premises, or use any
of them for any purposes other than for ingress and egress to and from the
Demised Premises;

 

2.             Attach
awnings or other projections to the outside walls of the Building or place
bottles, parcels or other articles, or lettering visible from the exterior, on
the windows, window sills or peripheral air conditioning enclosures;

 

3.             Attach
to, hang on, or use in connection with, any exterior window or entrance door of
the Demised Premises, any blinds, shades or screens which are not of a quality,
type, design and color, or which are not attached in a manner, approved by Landlord;

 

4.             Place
or leave any door mat or other floor covering in any area outside of the
Demised Premises;

 

5.             Exhibit,
inscribe, paint or affix any sign, insignia, advertisement, object or other
lettering in or on any windows, doors, walls or part of the outside or inside
of the Building (exclusive of the inside of the Demised Premises), or in the
Demised Premises if visible from the outside, without Landlord’s approval,
except that the name(s) of Tenant and any permitted sublessee may be displayed
on the entrance doors of the premises occupied by each and/or in or on the
walls of the elevator lobby serving the Demised Premises, subject to Landlord’s
reasonable approval of the size, color and design of such display and, if
Landlord elects to perform such work, Tenant shall pay Landlord for the
performance of such work;

 

6.             Cover
or obstruct the sashes, sash doors, skylights, windows and doors that reflect
or admit light and air into the halls, passageways or other public areas of the
Building;

 

7.             Place
in, attach to, put in front of, or affix to any part of the exterior of, the
Building or any of its halls, doors, corridors or vestibules, outside of the
Demised Premises, any lettering, signs, decorations, showcases, displays,
display windows, packages, boxes or other articles;

 

8.             Except
in the normal decoration of the interior of the Demised Premises, mark, paint,
drill into, or in any way deface, any part of the Building or the Demised
Premises or cut, bore or string wires therein (other than telephone, communications,
computer, office automation and other wiring required in connection with Tenant’s
business equipment);

 

9.             Permit
or allow bicycles, vehicles or animals of any kind to be brought into or kept
in or about the Building or the Demised Premises;

 

55

 

 

10.           Make,
permit or allow to be made, any unseemly or disturbing noises, whether by
musical instruments, recordings, radio, talking machines, television,
whistling, singing or in any other way, which might disturb other occupants in
the Building or those having business with them or impair or interfere with the
use or enjoyment by others of neighboring buildings or premises;

 

11.           Bring
into or keep on any part of the Demised Premises or the Building any
inflammable, combustible, radioactive or explosive fluid, chemical or substance
other than as required in connection with normal use of Tenant’s equipment and
where safeguarded as required by law;

 

12.           Place
upon any of the doors or windows in the Building any locks or bolts which shall
not be operable by the Grand Master Key for the Building, or make any changes
in locks or the mechanisms thereof which shall make such locks inoperable by
said Grand Master Key unless such change is approved by Landlord in which event
Tenant shall give Landlord duplicate keys for such locks or bolts;

 

13.           Remove,
or carry into or out of the Demised Premises or the Building, any safes,
freight, furniture, packages, boxes, crates or any bulky or heavy objects
except during such hours and in such elevators as Landlord may reasonably
determine from time to time;

 

14.           Use
any lighting in perimeter areas of the Building, other than that which is
standard for the Building or approved by Landlord, so as to permit uniformity
of appearance to those viewing the Building from the outside;

 

15.           Engage
or pay any employees on the Demised Premises except those actually working for
the Tenant in the Demised Premises, or advertise for laborers giving the
Demised Premises as an address;

 

16.           Obtain,
permit or allow in the Building the purchase, or acceptance for use in the
Demised Premises, by means of a service cart, vending machine or otherwise, of
any ice, drinking water, food, tobacco in any form, beverage, towel, barbering,
boot blackening, cleaning, floor polishing or other similar items or services
from any persons, except such vending machines at such places within the
Building and under such reasonable requirements as may be determined by
Landlord with respect to the furnishing of such items and services, provided
that same is provided solely for the use of Tenant’s employees and invitees and
not for resale and the charges for such items and services such persons are not
excessive;

 

17.           Close
and leave the Demised Premises at any time without closing all operable windows
and, if requested by Landlord, turning out all lights;

 

18.           Permit
entrance doors to the Demised Premises to be left open at any time or unlocked
when the Demised Premises are not in use;

 

19.           Encourage
canvassing, soliciting or peddling in any part of the Building or permit or
allow the same in the Demised Premises;

 

56

 

20.           Use, or permit or allow any of its employees, contractors,
suppliers or invitees to use, any space or part of the Building, including the
passenger elevators or public halls thereof, in the moving, delivery or receipt
of safes, freight, furniture, packages, boxes, crates, paper, office material
or any other matter or thing, any hand trucks, wagons or similar items which
are not equipped with such rubber tires, side guards and other safeguards which
shall have been approved by Landlord or use any such hand trucks, wagons or
similar items in any of the passenger elevators;

 

21.           Cause or permit any food odors or any other unusual
or objectionable odors to exist in or emanate from the Demised Premises or
permit any cooking or preparation of food except in areas approved by Landlord
and in compliance with local ordinances;

 

22.           Create or permit a public or private nuisance;

 

23.           Throw or allow or permit to be thrown anything
out of the doors, windows or skylights or down the passageways of the Building;

 

24.           Lay vinyl asbestos tile or other similar floor
covering so that the same shall come in direct contact with the floor or in a
manner or by means of such pastes or other adhesives which shall not have been
approved by the Landlord, it being understood that if linoleum or other similar
floor covering is desired to be used, an interlining of builder’s deadening felt
shall be first affixed to the floor, by a paste or other material which is
soluble in water, the use of cement or other similar adhesive material being
expressly prohibited;

 

25.           Use, allow or permit the passenger elevators
to be used by Tenant’s working hands (persons in rough clothing handling
packages, cartons and shipments of material or mail) or persons carrying bulky
packages or by persons calling for or delivering mail or goods to or from the
Demised Premises, and Tenant shall cooperate with Landlord in enforcing this
Rule on those making deliveries to Tenant;

 

26.           Request any of Landlord’s agents, employees or
contractors to perform any work, or do anything, outside of their regular
duties, unless previously approved by the Building manager;

 

27.           Invite to the Demised Premises or the
Building, or permit the visit of, persons in such numbers or under such conditions
as unreasonably to interfere with the use and enjoyment of any of the plazas,
entrances, corridors, arcades, escalators, elevators or other facilities of the
Building by other occupants thereof;

 

28.           Use, permit or allow the use of any fire exits
or stairways for any purpose other than emergency use except for use of
stairways between the floors of the Demised Premises for access purposes as
long as permitted by law;

 

57

 

29.           Employ any firm, person or persons to move safes,
machines or other heavy objects into or out of the Building, without prior
approval of Landlord of such persons and the manner in which such items will be
moved, which approval shall not be unreasonably withheld;

 

30.           Install or use any machines or machinery of
any kind whatsoever which may disturb any persons outside of the Demised
Premises; or

 

31.           Use the water and wash closets or other
plumbing fixtures for any purpose other than those for which they were constructed,
and shall not allow or permit sweepings, rubbish, rags, or other solid
substances to be thrown therein.

 

II.            Tenant shall:

 

1.             Pay Landlord for any damages, costs or
expenses incurred by Landlord with respect to the breach of any of the Rules
and Regulations contained in or provided by this Lease by Tenant, or any of its
servants, agents, employees, licensees or invitees, or the misuse by Tenant, or
any of the aforesaid, of any fixture or part of the Demised Premises or the
Building and shall cause its servants, agents, employees, licensees and invitees
to comply with the Rules and Regulations contained in or provided for by this
Lease;

 

2.             Upon the termination of this Lease, turn over
to Landlord all keys either furnished to, or otherwise procured by, Tenant with
respect to any locks used by Tenant in the Demised Premises or the Building
and, in the event of the loss of any such keys, pay to Landlord the cost of
procuring same;

 

3.             Subject to the provisions of Article 28
hereof, refrain from, and immediately upon receipt of notice thereof, discontinue
any violation or breach of the Rules and Regulations contained in or provided
for by this Lease;

 

4.             Request Landlord to furnish passes to persons whom
Tenant desires to have access to the Demised Premises during times other than
Business Hours and be responsible and liable to Landlord for all persons and
acts of such persons for whom Tenant requests such passes;

 

5.             Furnish artificial light and electrical energy
(unless Landlord shall furnish electrical energy as a service included in the
Rent) at Tenant’s expense for the employees of Landlord or Landlord’s
contractors while doing janitorial or other cleaning services or while making
repairs or alterations in the Demised Premises;

 

6.             Apply at the office of the Building’s manager with
respect to all matters and requirements of Tenant which require the attention
of Landlord, its agents or any of its employees;

 

7.             Pay Landlord reasonable charges for the installation
and replacement of ceiling tiles removed for Tenant by telephone installers or
others in the Demised Premises and public corridors, if any; and

 

58

 

8.             Pay Landlord’s reasonable charges
for the hiring or providing of security guards during times when Tenant, or any
subtenant of Tenant, is moving into or out of portions of the Demised Premises
or when significant quantities of furniture or other materials are being
brought into or removed from the Demised Premises.

 

III. Landlord
shall:

 

1.             Have
the right to inspect all freight objects or bulky matter (except printed
matter) brought into the Building other than through the separate entrances to
the Ground Floor and Lower Level and to exclude from the Building all objects
and matter which violate any of the Rules and Regulations contained in or
provided for by this Lease;

 

2.             Have
the right to require any person leaving the Demised Premises with any package,
or other object or matter, to submit a pass, listing such package or object or
matter, from Tenant;

 

3              In
no way be liable to Tenant or any other party for damages or loss arising from
the admission, exclusion or rejection of any person or any property to or from
the Demised Premises or the Building under the provisions of the Rules and
Regulations contained in or provided for by this Lease;

 

4.             Have
no liability or responsibility for the protection of any of Tenant’s property
as a result of damage or the unauthorized removal of any such property
resulting wholly or in part from Landlord’s failure to enforce, in any
particular instance, or generally, any of Landlord’s rights;

 

5.             Have
the right to require all persons entering or leaving the Building, during hours
other than Business Hours, to sign a register and may also exclude from the
Building, during such hours, all persons who do not present a pass to the
Building signed by Landlord;

 

6.             Furnish
passes to persons for whom Tenant requests same;

 

7.             Have
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 other
occupants, of the Building; and

 

8.             Have
the right to remove any violation of Paragraph I items 2, 3, 4, 5, 6, or 7 of
these Rules and Regulations without any right of Tenants to claim any liability
against Landlord, and have the right to impose a reasonable charge against
Tenant for removing any such violation or repairing any damages resulting
therefrom.

 

59

 

EXHIBIT D

 

The portion of
the Building demised exclusively to Tenant pursuant to this Lease is a portion
of the sixteenth floor consisting of 3,180 rentable square feet.

 

60

 

EXHIBIT E

 

STATEMENT
SPECIFYING COMMENCEMENT DATE

 

It is agreed
between the parties herein that, notwithstanding anything to the contrary
entered in the Lease, the actual Commencement Date of this Lease is                                                          ,
1995.

 

 

	
  Landlord:

  	
  366 Madison, Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Tenant:

  	
  Silipos, Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  

 

61

 

LEASE
MODIFICATION AND EXTENSION AGREEMENT

 

THIS AGREEMENT, dated as of November 1,
1995, between 366 MADISON, INC., a New York Corporation having an office c/o
The Galbreath Company, L.P., 437 Madison Avenue, New York, New York 10022, (“Landlord”),
and SILIPOS, INC., having an office at 366 Madison, New York, New York 10017 (“Tenant”).

 

W
I  T  N  E  S  S  E  T  H:

 

WHEREAS, Landlord and Tenant entered into a
lease dated as of April 25, 1995, ( the “Lease”), for premises located on
a portion of the 16th floor (“Premises”) of the building at 366 Madison Avenue,
New York, New York (“Building”); which Lease expires pursuant to its terms on June 30,
2000; and a photocopy of said Lease is annexed hereto and made a part hereof as
Exhibit 1; and

 

WHEREAS, Tenant is currently in possession of
the Premises pursuant to the Lease, wishes to lease additional space on the
16th floor of the Building, known as Suite 1611, (the “1611 Space”) and wishes
to remain in occupancy of the Premises from and from and after the expiration
of the term of the Lease on the

 

 

same terms and conditions as set forth in the Lease, except as
otherwise provided herein; and

 

WHEREAS, Landlord and Tenant desire to amend
the Lease and extend the term thereof, both effective November 1, 1995.

 

NOW, THEREFORE, in consideration of the
mutual covenants contained in this Agreement, Landlord and Tenant, effective November 1,
1995, agree as follows:

 

1.             Landlord
hereby demises and leases to Tenant, and Tenant hereby takes and hires from
Landlord the 1611 Space, as more particularly described in Exhibit 2 hereto,
for a term of five (5) years and two (2) months commencing November 1,
1995.  The term “Demised Premises” shall,
effective November 1, 1995, include the 1611 Space.  The date “June 30, 2000” in Section 1.02
of the Lease is deleted and the date “December 31, 2000” is inserted in
its place, so that the Lease Expirations Date shall be December 31, 2000,
or such earlier date upon which the term may expire or be terminated pursuant
to any of the conditions of limitation or other provision of the Lease or
pursuant to law.

 

2.             Section 2.01(b)
of the Lease is hereby deleted and the following substituted in its place: “ ‘ERIF’
(as defined in Article 23) shall mean $9,803.75”.

 

2

 

3.             Section 3.01(a) of the Lease is amended
to read as follows:

 

“(a) an annual
fixed rent (hereinafter called the ‘fixed rent’) at the rate of

 

	
  Period

  	
   

  	
  Per Annum

  	
   

  	
  Per Month

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11/1/95 -
  1/31/96

  	
   

  	
  $

  	
  81,885.00

  	
   

  	
  $

  	
  6,823.75

  	
   

  
	
  2/1/96 -
  6/30/97

  	
   

  	
  91,798.75

  	
   

  	
  7,649.90

  	
   

  
	
  7/1/97 -
  12/31/00

  	
   

  	
  95,363.75

  	
   

  	
  7,946.98

  	
   

  
								

 

which fixed rent shall be
payable in equal monthly installments in advance on the first day of each and
every calendar month of the term of this Lease; plus”

 

4.             Section 4.01(e) of the Lease is deleted and the
following substituted in its place:  “Tenant’s
Proportionate Share shall mean 3.73%;”.

 

5.             Section 4.01(i) of the Lease is deleted
and the following substituted in its place: 
“Labor Factor shall mean 3565;”.

 

6.             Article 5 of the Lease is amended by
adding thereto the phrase “and/or Tenant’s 1611 Space Work” to the phrase “Tenant’s
Work” wherever the same shall appear therein. 
Landlord shall contribute up to $4,296.60 as Landlord’s Contribution for
Tenant’s 1611 Space Work provided Tenant shall otherwise comply with item 3 of
Lease Exhibit A.

 

3

 

7.             The Security Deposit set forth in Article 36
of the Lease of $14,177.50 is hereby deleted and the sum of $15,893.96 is
inserted in its place.

 

8.             Article 37 of the Lease is amended by
increasing Tenant’s listings on the Building’s tenant directory from eight (8)
to ten (10).

 

9.             Section 39.01 of the Lease is amended by
changing the words “first two years” on line 12 thereof to “first two and one half
(21/2) years”.

 

10.           Tenant covenants, represents and warrants
that Tenant has had no dealing or negotiations with any broker or agent other than
The Galbreath Company, L.P. (“Broker”) in connection with the consummation of
this Agreement.  Landlord shall pay
Broker its commission pursuant to a separate agreement.  Tenant shall pay, hold harmless, and
indemnify Landlord from and against any and all cost, expense (including
attorneys’ fees and disbursements incurred in establishing liability and in
collecting amounts payable hereunder), or liability for any commissions,
compensation, or charges claimed by any broker or agent (other than Broker)
with respect to this Agreement or its negotiation.

 

4

 

11.           This
Agreement may not be changed or terminated
orally, but only by an agreement in writing signed by Landlord and Tenant.

 

12.           This
Agreement is offered for signature by Tenant
and it is understood that this Agreement shall not be binding upon Landlord
unless and until Landlord shall have executed and delivered a fully executed
copy of this Agreement to Tenant.

 

13.           Except
as specially modified by this Agreement, the
provisions of the Lease are confirmed and approved and shall continue in full
force and effect.

 

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

 

	
   

  	
  366 MADISON, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ [ILLEGIBLE]

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SILIPOS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joel E. Bickel

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Joel E. Bickel

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  
	
   

  	
  Tenant’s Federal I.D. #: 13-3489934

  
						

 

5

 

SECOND LEASE
MODIFICATION AND EXTENSION AGREEMENT

 

THIS AGREEMENT, dated as of December 16,
1997, between 366 MADISON, INC., a New York corporation having an office c/o
The Galbreath Company, L.P., 437 Madison Avenue, New York, New York 10022, (“Landlord”),
and SILIPOS, INC., having an office at 366 Madison Avenue, New York, New York
10017 (“Tenant”).

 

W
I  T  N  E  S  S  E  T  H:

 

WHEREAS,
Landlord and Tenant entered into a lease dated as of April 25, 1995 (the “Original
Lease”), and a Lease Modification and Extension Agreement dated as of November 1,
1995 (the “First Modification”) (the Original Lease, as modified and amended by
the First Modification, shall be referred to herein as the “Existing Lease”),
for premises, located on a portion of the 16th floor (the “Existing Space”) of
the building at 366 Madison Avenue, New York, New York (the “Building”); which
Existing Lease expires pursuant to its terms on December 31, 2000; and a
photocopy of said Existing Lease is annexed hereto and made a part hereof as
Exhibit 1; and

 

WHEREAS,
Tenant is currently in possession of the Existing Space pursuant to the Exiting Lease, wishes
to lease the balance of the 16th floor of the Building, consisting of
approximately 1,463 rentable square feet (the “Additional Space”), and wishes
to remain in occupancy of the Existing Space from and after the expiration of
the term of the Existing Lease on the same terms and conditions as set forth in
the Existing Lease, except as otherwise provided herein; and

 

1

 

WHEREAS,
Landlord and Tenant desire to amend the Existing Lease and extend the term
thereof, both effective on the date Lee Gross or her successors and/or assigns
(“Gross”), the existing tenant of that portion of the Additional Space known as
Suite 1601 (the “1601 Space”), surrenders possession of the 1601 Space (the “Extension
Commencement Date”), as evidenced by either (i) a court order or other document
requiring Gross to vacate the 1601 Space on a certain date, or (ii) a lease
surrender agreement or similar document executed by Gross and indicating the
date of such surrender (any of the documents set forth in (i) or (ii) above
shall be referred to as the “Surrender Document”).

 

NOW,
THEREFORE, in consideration of the mutual covenants contained in this
Agreement, Landlord and Tenant, effective on the Extension Commencement Date,
agree as follows:

 

1.             The
foregoing “WHEREAS” recitals are incorporated into this Agreement by this
reference.

 

2.             Landlord
hereby demises and leases to Tenant, and Tenant hereby takes and hires from
Landlord the Additional Space, as more particularly described in Exhibit 2
attached hereto and made a part hereof, for a term of ten (10) years commencing
on the Extension Commencement Date.  The
term “Demised Premises” shall, effective on the Extension Commencement Date,
include the Additional Space.  The term “Lease”
shall, effective on the Extension Commencement Date, mean the Existing Lease as
modified and extended by this Second Lease Modification and Extension Agreement.  The date “December 31, 2000” in
Paragraph 1 of the First Modification, modifying Section 1.02 of the
Original Lease, effective on the Extension Commencement Date, is deleted and
the following is inserted in its place:  “which
is the last day of the calendar month in which occurs the tenth (10th)
anniversary of the Extension Commencement Date”, so that the Lease Expiration

 

2

 

Date shall be that date which is the last day
of the calendar month in which occurs the tenth (10th) anniversary of the
Extension Commencement Date, or such earlier date upon which the term may
expire or be terminated pursuant to any of the conditions of limitation or
other provision of the Lease or pursuant to law.

 

3.             At
the request of either party, Landlord and Tenant shall execute a written
agreement confirming the Extension Commencement Date, but the failure of either
party to execute such written confirmation shall not affect the validity of the
Extension Commencement Date as evidenced by the Surrender Document.

 

4.             Until
the Extension Commencement Date, the terms and provisions of the Existing
Lease, unmodified by this Agreement, shall remain in full force and effect.

 

5.             Tenant
acknowledges that Landlord will not have possession of the 1601 Space at the
time this Agreement is executed, and may not obtain the same for an extended
period of time.   Tenant further
acknowledges that Landlord is not making any representations or warranties as
to when the 1601 Space will become vacant.

 

6.             Notwithstanding
anything to the contrary contained herein, if Gross has not surrendered
possession of the 1601 Space by 11:59 pm on July 31, 1998 (the “Cancellation
Date”), then, at Tenant’s option, upon written notice delivered to Landlord on
or before September 30, 1998 (provided Gross has not theretofore surrendered
possession of the 1601 Space), this Agreement shall as of the Cancellation Date
be deemed null and void and without further force or effect.  In such event, the Additional Security (as
defined in Paragraph 14 hereof), and any interest earned thereon, shall be
returned to Tenant by Escrow Agent in accordance with the provisions of
Paragraph 14 hereof.

 

3

 

7.             Paragraph
2 of the First Modification is deleted and the following substituted in its
place:  “Section 2.01(b) of the Original
Lease is hereby deleted and the following substituted in its place:  ‘ERIF’ (as defined in Article 23) shall
mean $13,827.00.

 

8.             Paragraph
3 of the First Modification is deleted and the following substituted in its
place:  “The introductory paragraph and
paragraph (a) of Section 3.01 of the Original Lease are amended to read as
follows:

 

3.01         Subject to Section 5.02,
the rent reserved under this Lease (hereafter called the “rent”), for the term
hereof, shall, with respect to that portion of the Demised Premises defined as
the Existing Space, commence on the Extension Commencement Date, and with
respect to that portion of the Demised Premises defined as the Additional
Space, commence sixty (60) days after “substantial completion” of Tenant’s Work
for which Tenant is receiving Landlord’s Contribution, as so set forth in
Exhibit A. “Substantial completion” shall be certified to by Tenant’s contractor,
but in all events rent as to the Additional Space shall commence 120 days from
the Extension Commencement Date.  The
aforesaid dates are hereinafter collectively called the “Rent Commencement Date”
and rent shall be and shall consist of:

 

(a) (i)  with respect to the Existing Space, an annual
fixed rent (hereinafter called the “Existing Space Fixed Rent”), including that
share of the ERIF allocated to the Existing Space, at the rate of

 

	
  Period

  	
   

  	
  Per Annum

  	
   

  	
  Per Month

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Extension
  Commencement Date–12/31/00

  	
   

  	
  $

  	
  95,363.75

  	
   

  	
  $

  	
  7,946.98

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1/1/01–12/31/03

  	
   

  	
  $

  	
  106,058.75

  	
   

  	
  $

  	
  8,838.23

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1/1/04–Expiration
  Date

  	
   

  	
  $

  	
  109,623.75

  	
   

  	
  $

  	
  9,135.31

  	
   

  

 

(ii)  with respect to the Additional Space, an
annual fixed rent (hereinafter called the “Additional Space Fixed Rent”),
including that share of the ERIF allocated to the Additional Space, at the rate
of

 

	
  Period

  	
   

  	
  Per Annum

  	
   

  	
  Per Month

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Extension
  Commencement Date–12/31/00

  	
   

  	
  $

  	
  40,598.25

  	
   

  	
  $

  	
  3,383.19

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1/1/01–12/31/03

  	
   

  	
  $

  	
  43,524.25

  	
   

  	
  $

  	
  3,627.02

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1/1/04–Expiration
  Date

  	
   

  	
  $

  	
  44,987.25

  	
   

  	
  $

  	
  3,748.94

  	
   

  

 

4

 

(the Existing
Space Fixed Rent and the Additional Space Fixed Rent shall hereinafter
collectively be referred to as the “fixed rent”) which fixed rent shall be
payable in equal monthly installments in advance on the first day of each and
every calendar month of the term of this Lease (except as stated below);
commencing on the Rent Commencement Date and each and every month thereafter;
plus”.

 

9.             Section 4.01(b) of the Original Lease is
deleted.

 

10.           Section 4.01(c)
of the Original Lease is deleted and the following substituted in its place: “‘Base
Tax’ shall mean the Taxes payable (as finally determined if contested) for
the 1998/99 fiscal tax year of The City of New York;”.

 

11.           Paragraph
4 of the First Modification is deleted and the following substituted in its
place:  “Section 4.01(e) of the Original
Lease is deleted and the following substituted in its place:  ‘Tenant’s Proportionate Share shall
mean 5.25%;’”.

 

12.           Section 4.01(g)
of the Original Lease is deleted and the following substituted in its place: “‘Base
Labor Rate’ shall mean the Labor Rate in effect on January 1, 1998;”.

 

13.           Paragraph
5 of the First Modification is deleted and the following substituted in its
place:  “Section 4.01(i) of the Original
Lease is deleted and the following is substituted in its place: ‘Labor
Factor shall mean 5028;’”.

 

14.           The
Security Deposit set forth in Article 36 of the Original
Lease, as modified by the First Modification, of $15,893.96 is hereby deleted
and the sum of $21,989.79 is inserted in its place.  Tenant shall pay to Landlord’s attorney (the “Escrow
Agent”) on the execution of this Agreement the sum of $6,095.83 as additional
security (the “Additional Security”) to be held in trust in a special,
interest-bearing account under the exclusive control of Escrow Agent, subject
to the provisions

 

5

 

of this paragraph 14.  On receipt by Escrow Agent of a statement or
statements executed by each of Landlord, its successors or assigns, and Tenant,
its successors or assigns, on or after the Extension Commencement Date, that
Gross has vacated the 1601 Space, Escrow Agent shall promptly deliver (i) the
Additional Security to Landlord and (ii) any interest earned on the Additional
Security to Tenant.

 

Notwithstanding
the foregoing, on receipt by Escrow Agent of a statement executed by one of the
parties herein (Landlord, Tenant or their successors or assigns) on or after
the Cancellation Date that this Agreement has become null and void, Escrow
Agent shall, within five (5) business days, deliver a copy of said statement to
the other party and return said Additional Security, and any interest earned thereon,
to Tenant on the tenth (10th) business day after receipt by Escrow Agent of
said statement unless Escrow Agent, prior to such return, receives from the
other party a statement contesting the accuracy of the requesting party’s
statement and demanding retention of said Additional Security, and any interest
earned thereon, by Escrow Agent. On receipt of such a statement demanding
retention, Escrow Agent shall then release the Additional Security, and any
interest earned thereon, only on receipt of a statement executed by both
parties directing the release of the Additional Security, and any interest
earned thereon.

 

Notwithstanding
anything herein to the contrary, Escrow Agent may at any time and with notice
to the parties, surrender the Additional Security, and any interest earned
thereon, to a court of competent jurisdiction for such disposition as may be
directed by such court.

 

Upon delivery
of the Additional Security to either party, and any interest earned on the
Additional Security to Tenant, or

 

6

 

delivery of the Additional Security, and any
interest earned thereon, to a court of competent jurisdiction under and
pursuant to the provisions of this Paragraph 14, Escrow Agent shall be relieved
of all liability, responsibility or obligation with respect to, or arising out
of, the Additional Security, and any interest earned thereon, and any and all
of its obligations arising therefrom.

 

Escrow Agent,
in connection with its performance in such capacity, shall not be liable to
either party. In addition, it is agreed that any and all escrow deposits,
whether of the Additional Security hereunder or for any other purpose
thereafter paid hereunder to the Escrow Agent, are being made for the
accommodation of the parties hereto and Escrow Agent shall be deemed to be a
stakeholder only. In the event any litigation should arise between the parties
to this Agreement concerning any such escrow deposit, then the parties hereto
do severally and jointly agree to indemnify and save harmless Escrow Agent from
the payment of any costs or any other expense that may be involved in said
litigation. Escrow Agent may continue to represent the Landlord in connection
with any litigation.

 

Escrow Agent
shall not have any liability or obligation for loss of all or any portion of
the Additional Security, and any interest earned thereon, or any other escrow
deposit by reason of the insolvency or failure of the institution or depository
with which the escrow account is maintained. 
Landlord and Tenant agree that Escrow Agent shall not be responsible as
to the selection of the bank or trust company with which the escrow account is
maintained.

 

15.           Article 37
of the Original Lease, as modified by the First Modification, is amended by
increasing Tenant’s listings on the Building’s tenant directory from ten (10)
to sixteen (16).

 

7

 

16.           Article 39
of the Original Lease is deleted in its entirety.

 

17.           The
last sentence of Section 6.05 (i) of Article 6 of the Original Lease
is deleted.

 

18.           Exhibit
A of the Original Lease is modified as set forth below:

 

(a)            Section 1
is deleted in its entirety and the following substituted in its place:

 

1.              LANDLORD’S WORK

 

The Additional
Space shall be delivered to Tenant on the Extension Commencement Date vacant,
in broom clean and otherwise “as is” condition, except that Landlord, at its
own cost and expense shall perform or cause to be performed the following work
in the Additional Space:

 

a.             Make
all windows operable.

b.             Install
locks where necessary.

 

Landlord shall
not perform any work in the Demised Premises except as set forth above.

 

(b)           The
words “Demised Premises” in the second line of the first paragraph of Section 2
are deleted and the following substituted in its place:  “Additional Space”.

 

(c)            The
date “3/10/95” in the third line of the first paragraph of Section 2 is
deleted and the following substituted in its place:  “11/26/97”.

 

(d)           The
language “$35,489 (Thirty-five thousand four hundred eighty nine dollars)”
beginning on the second line of the first paragraph of Section 3 is
deleted and the following substituted in its place:  “$70,000 (Seventy Thousand Dollars)”.

 

(e)            The
words “of the Additional Space” are inserted in the fourth line of Sub-section (a)
of Section 3 immediately following the word “occupancy”.

 

(f)            The
word “Demised” is inserted in the sixth line of Sub-section (a) of Section 3
immediately before the word “Premises”.

 

(g)           The
dollar amount of “$35,489” in the twelfth line of Sub-section (a) of Section 3
is deleted and the following substituted in its place:  “$70,000”.

 

(h)           The
dollar amount of “$35,489.00” in the last line of Sub-section (b)(ii) of Section 3
is deleted and the following substituted in its place:  “$70,000.00”.

 

8

 

(i)            The
word “to” is inserted in the seventh line of Sub-section (d) of Section 3
immediately before the word “enforce”.

 

(j)            The
date “3/10/95” in Section 4 is deleted and the following substituted in
its place:  “11/26/97”.

 

(k)           The
following Section 5 is added to Exhibit A of the Original Lease;

 

5.             LANDLORD’S
ARCHITECTURAL CONTRIBUTION

 

In addition to
Landlord’s Contribution as set forth in Section 3 of this Exhibit A,
provided that Tenant is not in default hereunder, Landlord agrees to contribute
to Tenant an amount (hereinafter “Landlord’s Architectural Contribution”) to be
applied only towards the architectural expenses actually incurred by Tenant in
connection with the Additional Space in respect of the architectural work
contemplated in the Preliminary Plans initialed by the parties hereto, dated
11/26/97 and in possession of Landlord (the “Architectural Work”) (and not for
any architectural work required as the result of renovations or other work not contemplated
in the aforesaid Preliminary Plans).  Any
cost or expense incurred for any architectural work required as the result of
renovations or other work not contemplated in the aforesaid Preliminary Plans
or as a result of any material or substantial change to the aforesaid
Preliminary Plans shall be borne and paid for by Tenant.

 

(a)             As
Landlord’s Architectural Contribution, Landlord will pay for sums actually
incurred by Tenant in connection with the Architectural Work, provided,
however, that Tenant is not, at the time of such Landlord’s Architectural
Contribution, in breach or default (after notice and the expiration of any applicable
cure period) under any of the monetary or material non-monetary terms,
covenants, provisions or conditions of the Lease on its part to be observed, performed
or complied with.

 

(b)             Subject
to the conditions hereof, the Landlord’s Architectural Contribution shall be
made by Landlord, after completion of Tenant’s Work, upon submission to Landlord
of invoices by the architect for the Architectural Work.

 

(c)             Landlord’s
obligation to pay the Landlord’s Architectural Contribution shall benefit only
Tenant, and neither such obligation nor any other provision hereof shall
benefit any of Tenant’s contractors, subcontractors, laborers, suppliers or
materialmen, or any other person or entity, or entitle any of the foregoing to
enforce any provision of this agreement against Landlord or any person or
entity claiming by, through or under Landlord, including, without limitation,
any of Landlord’s lenders.

 

19.           Tenant
covenants, represents and warrants that Tenant has had no dealing or
negotiations with any broker or agent other than The Galbreath Company, L.P. (“Broker”)
in connection with the consummation of this Agreement.  Landlord shall pay Broker its commission
pursuant to a separate agreement.  Tenant
shall

 

9

 

pay, hold harmless, and indemnify Landlord
from and against any and all cost, expense (including attorneys’ fees and
disbursements incurred in establishing liability and in collecting amounts
payable hereunder), or liability for any commissions, compensation, or charges
claimed by any broker or agent (other than Broker) with respect to this
Agreement or its negotiation.

 

20.           This
Agreement may not be changed or terminated orally, but only by an agreement in
writing signed by Landlord and Tenant.

 

21.           This
Agreement is offered for signature by Tenant and it is understood that this
Agreement shall not be binding upon Landlord unless and until Landlord shall
have executed and delivered a fully executed copy of this Agreement to Tenant.

 

22.           Except
as specifically modified by this Agreement, the provisions of the Existing
Lease are confirmed and approved and shall continue in full force and effect.

 

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

 

	
   

  	
  366 MADISON, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ [ILLEGIBLE]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SILIPOS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joel E. Bickel

  	
   

  
	
   

  	
   

  	
  Name: JOEL E. BICKEL

  
	
   

  	
   

  	
  Title: CHM/CEO

  
	
   

  	
   

  	
   

  
	
   

  	
  Tenant’s Federal I.D. #: 13-3489934

  
					

 

10Exhibit 10.45

 

FIRST AMENDMENT TO SUBLEASE

 

This Amendment to
the Sublease is entered into as of July 15, 1998, by and between CALAMAR
ENTERPRISES, INC., on behalf of a Limited Liability Company to be formed, (the “Landlord”),
and SILIPOS INC., a Delaware corporation having an address at 366 Madison
Avenue, Suite 1616, New York, New
York 10017 (the “Tenant”).

 

RECITALS

 

WHEREAS, the
Landlord and Tenant entered into a Sublease as of May 21, 1998; and

 

WHEREAS, the
Landlord is financing the premises as defined in the Sublease with inter alia
the Niagara County Industrial Development Agency (the “Project”); and

 

WHEREAS, the
Niagara County Industrial Development Agency requires certain reporting to it;
and

 

WHEREAS, the
Landlord and the Tenant desire to set forth the terms of this First Amendment
to the Lease to conform with the reporting requirements;

 

NOW, THEREFORE, in
consideration of the mutual covenants herein set forth, the Landlord and the
Tenant do hereby agree to the terms and conditions set forth in this lease.

 

1.                                       Article 13
is amended by adding the following as an additional paragraph to Section 13.13:

 

“Tenant shall in
addition comply with and provide information as required, to the extent
applicable, by

Sections 2.2(J), 8.11, 8.12 and Exhibit F of the Lease between the Niagara
County Industrial Development Agency and the Landlord”, copies of which
Sections and Exhibit F are attached hereto and incorporated herein by
reference.

 

2.                                       Except
as above provided all the terms and provisions of the lease entered into as of May 21,
1998 remain in full force and affect.

 

	
   

  	
  LANDLORD:

  
	
   

  	
  CALAMAR ENTERPRISES,
  INC. on behalf of a Limited Liability Company to be formed

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  by: 

  	
  /s/ Kenneth M.
  Franasiak

  	
   

  
	
   

  	
   

  	
  Kenneth M. Franasiak

  President

  

 

 

	
   

  	
  TENANT:

  
	
   

  	
  SILIPOS INC.

  
	
   

  	
   

  
	
   

  	
  by:

  	
  /s/ Joel E. Bickell

  	
   

  	 

	
   

  	
   

  	
  Joel E. Bickell

  Chairman/CEO

  
	
   

  	
   

  

 

 

SECOND AMENDMENT TO
SUBLEASE

 

This Amendment to
the Sublease is entered into as of March 1, 1999, by and between WILLIAMS
ROAD HOLDINGS, LLC (the “Landlord”), and SILIPOS  INC., a Delaware corporation having an
address at 366 Madison Avenue, Suite 1616, New York, New York 10017 (the “Tenant”).

 

RECITALS

 

WHEREAS, CALAMAR
ENTERPRISES, INC., on behalf of a Limited Liability Company to be formed and
the Tenant entered into a Sublease as of May 21, 1998 and a First
Amendment to the Sublease on July 15, 1998 (collectively, the “Sublease”);
and

 

WHEREAS, the
Landlord is the Limited Liability Company which was so formed and is now the
Landlord designated in the Sublease; and

 

WHEREAS, the Landlord
is about to obtain a loan (the “NCDC Loan”) from the Niagara County Development
Corporation (“NCDC”) and a loan from the New York Job Development Authority (“JDA”)
through NCDC (the “JDA Loan”) in connection with the construction of the
Premises (the “Project”); and

 

WHEREAS, the
agreements evidencing such financing require the Landlord to comply or cause
the occupant of the Premises to comply with certain covenants and reporting
requirements regarding the use and occupancy of and employment at the Premises;
and

 

WHEREAS, the
Landlord and Tenant desire to amend the Sublease to ensure compliance by the
Tenant with any such applicable covenants and reporting requirements.

 

NOW, THEREFORE, in
consideration of the mutual covenants herein set forth, the Landlord and the
Tenant do hereby agree to the terms and conditions set forth in this Amendment
to Sublease.

 

1.                                       Article 13
of the Sublease is hereby further amended by adding the following as additional
paragraphs to Section 13.13:

 

“In addition to
the foregoing, Tenant shall comply with and provide information to NCDC or JDA,
as applicable, the Landlord (for the purpose of enabling Landlord to provide
such information to NCDC and JDA as may be required by NCDC and JDA) in
connection with the NCDC Loan and the JDA Loan, to the extent applicable to
Tenant and for so long as the NCDC Loan and/or JDA Loan remains outstanding, as
follows:

 

NCDC Loan:

 

(a)                                  Tenant
shall make good faith efforts to achieve the project job goals (both for total
jobs as well as low and moderate income jobs) as such goals are established in

 

 

the Employment Schedule provided
by Tenant to Landlord as part
of the Landlord’s application to NCDC for the NCDC Loan, and Tenant shall make
good faith efforts to give preference to persons residing with the limits of
the County of Niagara when filling employment vacancies or hiring new
employees, in accordance with NCDC’s established policies to promote
development of business within the County of Niagara and to increase employment
opportunities for Niagara County residents.

 

(b)                                 Tenant
shall:

 

(i)                                     Keep
proper records, which records shall be on a form provided by NCDC, shall be
certified by Tenant and shall include, without limitation, data on the
residency, gross family income if provided by job applicant, and position
applied for, of all applicants for employment, whether or not hired for that
employment.  Tenant understands that such
employment data is necessary to enable NCDC to comply with the reporting
requirements in connection with the use of Federal funds.

 

(ii)                                  Furnish
to NCDC by April 30th of each year during the term of the
Sublease or until the NCDC Loan is paid in full, if sooner, an employee data
report which report shall be on a form provided by NCDC, shall be certified by
Tenant and shall include, without limitation, data on the residency, income if
provided by job applicant, skill lovel and permanent or temporary employment
status of Tenant’s employees by gender and further identified as members of a
minority or non-minority group.  Tenant
understands that such employment data is necessary to enable NCDC to comply
with the reporting requirements in connection with the use of Federal funds.  Each such report shall be kept confidential by
NCDC and shall only be disclosed to the United States Department of Housing and
Urban Development (“HUD”), to the County of Niagara or as otherwise required by
law.

 

(c)                                  Tenant
shall (i) conduct, and will cause each subsidiary to conduct, their respective
operations in compliance with the applicable provisions of all federal, state
or local laws, ordinances, rules, regulations and orders applicable to Tenant’s
operations at the Premises; and (ii) promptly notify NCDC in writing if
Tenant or any subsidiary receives any notice or request for information from
any governmental agency, other entity or person, or if Tenant or any subsidiary
provides any notice or information to any such agency, entity or person,
concerning the presence or  release of hazardous substances, wastes or
other materials (as such terms are defined by any applicable federal, state or local law) within, on, from, related
to, or affecting, the Premises.

 

(d)                                 Upon
the written request of NCDC and subject to NCDC’s compliance with all
applicable laws, ordinances, rules and regulations, the NCDC may, at its own expense, erect a free standing
sign on the Premises (but not on the building) for a period of up to ninety
(90) days, which sign shall be satisfactory to NCDC and to Tenant and may
recite, among other things, that NCDC is providing financing for a portion of
the Project.

 

(e)                                  During
the term of the Sublease or until payment of the NCDC Loan, if sooner, Tenant
agrees as follows:

 

2

 

(i)                                     Tenant
will not discriminate against any employee or applicant for employment because
of race, color, religion, sex or national origin.  Tenant will take affirmative action, to the
extent required by applicable laws, to ensure that applicants for employment
are employed and that employees are treated during employment, without regard
to their race, color, religion, sex or national origin.  Such action shall include, but not be limited
to, the following: employment; termination; rates of pay or other forms of
compensation; and selection for training, including apprenticeship.  Tenant agrees to post in conspicuous places,
available to employees and applicants for employment, notices to be provided by
NCDC setting forth the provisions of this nondiscrimination clause.

 

(ii)                                  Tenant
will, in all solicitations or advertisements for employees placed by or on
behalf of Tenant, state that all qualified applicants will receive
consideration for employment without regard to race, color, religion, sex or
national origin.

 

(iii)                               Tenant
will comply with all applicable provisions of Executive Order 11246 of September 24,
1965 and of the rules, regulations and relevant orders of the Secretary of
Labor.

 

(iv)                              Tenant
will furnish all information and reports required by Executive Order 11246 of September 24, 1965 and
by the rules, regulations and orders of the Secretary of Labor, or pursuant
thereto, and will permit access to its books, records and accounts by the
Department and Secretary of Labor for purpose of investigation to ascertain
compliance with such rules, regulations and orders.

 

(v)                                 Tenant
will include the provisions of Subparagraphs (e)(i) through (e)(v) in
every subcontract, purchase order or loan agreement unless exempted by rules,
regulations or orders of the Secretary of Labor issued pursuant to Section 204
of Executive Order 11246 of September 24, 1965 so that such provisions
will be binding upon each subcontractor, vendor or borrower.  Tenant will take such action with respect to
any subcontractor, vendor or borrower as a result of such direction by the
Department, and Tenant may request the United States to enter into such
litigation to protect the interest of the United States.

 

(vi)                              Tenant
will comply with all the applicable requirements of Section 114 of the
Clean Air Act, as amended (42 USC 1857C-8), and Section 308 of the
Federal Water Pollution Control Act, as amended (33 USC 1318), relating to
inspection, monitoring, entry, reports and information, as well as all other
requirements specified in said Section 114 and Section 308, and all
regulations and guidelines issued thereunder.

 

JDA Loan:

 

(a)                                  Tenant
shall permit JDA to have access to, and examine at all reasonable
times during normal business hours upon reasonable prior notice, its properties, minute books,

 

3

 

books of account
and financial records, and other corporate records for the sole purpose of
determining compliance with the provisions hereof applicable to JDA.

 

(b)                                 Tenant
shall, upon request of Landlord or JDA, furnish to JDA within one hundred twenty
(120) days after the closing of its fiscal year:

 

(i)                                     financial
statements fairly presenting the results of its operations for such fiscal year
prepare by an independent certified public accountant, and

 

(ii)                                  a
certificate of its president or one of its vice presidents or other authorized
person stating that a review of its activities during such fiscal year has been
made under the supervision of such president or vice president or other
authorized person with a view to determining whether or not it has fulfilled
its obligations under this Second Amendment to Sublease applicable to the JDA
Loan, the provisions of the JDA Statute as may be applicable to the Tenant, and
the rules and regulations of JDA as may be applicable to the Tenant, and
that to the best of his/her knowledge and belief, it has fulfilled all such
obligations, or specifying all defaults of which he/she has knowledge.

 

(c)                                  Tenant
shall comply with all applicable Federal and State legal requirements
pertaining to

non-discrimination and equal opportunity in hiring and operational practices,
and with the Non-Discrimination and Affirmative Action Policy Rider annexed hereto.

 

(d)                                 Within
thirty (30) days after the first anniversary date of the JDA Loan and annually
thereafter for the term of the JDA Loan, Tenant shall, upon request of Landlord
or JDA, provide Landlord or JDA with a certificate of an authorized officer as
to the number of full time employees and part time employees in the employ of
Tenant on such dates.

 

(e)                                  Tenant
authorizes the State Department of Labor
to furnish to JDA any information requested by JDA respecting employment for
the purposes of JDA’s statutory requirements (Section 537 N.Y. Labor Law).

 

(f)                                    Tenant
shall notify JDA in writing as soon as possible of any change of its State
Unemployment Identification Number.

 

(g)                                 Upon
request of JDA, Tenant shall provide to JDA such further information concerning
its business affairs and financial condition as JDA may reasonably request for
the sole purpose of determining compliance with the provisions hereof
applicable to JDA.

 

(h)                                 Except
to the extent otherwise provided in the Sublease, Tenant shall continually
occupy the Premises.

 

(f)                                    Except
to the extent otherwise provided in the Sublease, Tenant shall comply with all
applicable requirements set forth in any insurance policy carried with respect

 

4

 

to the Premises and with
all applicable statutes, rules, regulations, and orders of any Federal, State
or municipal authority having jurisdiction over the Premises and shall obtain,
comply with and review on a timely basis all applicable permits and approvals
required for the conduct of its operations at the Premises.  Tenant currently has all such required permits
and approvals.

 

(g)                                 Tenant
covenants that the Premises shall be used only for the operation of an Eligible
Business Facility or a Manufacturing Plant as defined in the JDA Statute and that the Premises shall not be used
by a mercantile or service establishment selling goods or services directly to
the general public.

 

(h)                                 The
Tenant agrees that should JDA as a result of the occurrence of an event, with
respect to Tenant only, described in Section 9.18 or in Article XI of
the Loan and Use Agreement
executed and delivered by Landlord on March 12, 1999 in connection with
the JDA Loan, increase the rate of interest to Landlord on the JDA Loan, the
base rent reserved herein shall be raised dollar for dollar to reflect the increased
interest expense actually incurred unless modified or waived by JDA provided,
however, that such rent increase shall be effective only for so
long as the event giving rise to the increase is unremedied Landlord is
required by JDA to pay such increased interest.  Landlord authorizes Tenant to negotiate
directly with JDA in connection with any proposed increase and to seek a
modification or waiver of this provision with JDA.”

 

2.                                       Except
as above provided, all the terms and provisions of the Sublease remain in full
force and effect.

 

	
  LANDLORD:

  	
  TENANT:

  
	
  WILLIAMS ROAD HOLDINGS,
  LLC

  	
  SILIPOS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Kenneth M.
  Franasiak

  	
   

  	
  By:

  	
  /s/ Joel E. Bickell

  	
   

  	 

	
   

  	
  Kenneth M. Franasiak,
  President

  	
   

  	
  Joel E. Bickell,
  Chairman/CEO

  
							

 

5

 

SUBLEASE

 

This sublease
(this “Lease”) is entered into as of May 21, 1998, by and between CALAMAR
ENTERPRISES, INC. on behalf of a Limited Liability Company to be formed, (the “Landlord”),
and SILIPOS INC., a Delaware corporation having an address at 366 Madison
Avenue, Suite 1616, New York, New York 10017 (the “Tenant”).

 

RECITALS

 

WHEREAS, Landlord
and Tenant desire that Landlord construct a medical products manufacturing and
distribution facility for sublease to Tenant; and

 

WHEREAS, Landlord
intends to enter into as lessee, an Agency Lease with Niagara County Industrial
Development Agency with respect to such facility; and

 

WHEREAS, Landlord
and Tenant desire to set forth the terms on which such manufacturing and
distribution facility will be constructed and subleased to the Tenant, all as
more fully set forth herein.

 

NOW, THEREFORE, in
consideration of the mutual covenants herein set forth, the Landlord and the
Tenant do hereby agree to the terms and conditions set forth in this lease.

 

1.1                                 Definitions.
 The following terms, have the meaning
indicated or referred to below.

 

“Additional Rent”
means all charges payable by the Tenant pursuant to this Lease other than
Annual Fixed Rent, including without implied limitation, the Tenant’s Tax
Expense as provided in Section 3.2; the Tenant’s Operating Expenses in
accordance with Section 3.3; amounts payable for Additional services
pursuant to Section 3.5.

 

“Agency” mean the
Niagara County Industrial Development Agency, a New York public benefit
corporation located at 2055 Niagara Falls Boulevard, Niagara Falls, New York
14304.

 

“Agency Lease”
means that Agency Lease Agreement to be entered into between the Agency and the
Landlord with respect to the Premises and/or Property.

 

“Annual Fixed Rent”
means the applicable annual rent for the Initial Term and any Extension Term as
set forth in Exhibit A attached to and made a part hereof.

 

“Building” means a
building to be constructed by Landlord of not less than 35,000 square feet of
gross building area with the amount of rentable square feet to be calculated in
accordance with the construction Standards set forth in Exhibit B attached
to and made a part hereof.

 

 

“Commencement Date”
–has the meaning set forth in Section 2.2.

 

“Consulting
Engineer” means Nussbaumer & Clarke, Inc. or any other consulting
engineer retained by Tenant upon prior notice to Landlord, at Tenant’s sole
cost and expense.

 

“Consumer Price
Index” means the Consumer Price Index, for all Urban Consumers (CPI-U, All
Cities Index, 1982-84 base year), prepared by the United States
Department of Labor Bureau of Labor Statistics, and in the event such index is
not in existence when any determinations using it are to be made, or the basis
for calculating such index shall have been changed, the most equivalent index
published by the United States Bureau of Labor Statistics or by any successor
governmental agency or if none is published by such agency, then the most
equivalent index as may then be published by a non-governmental agency as in
each case reasonably selected by the Landlord with the approval of the Tenant
not to be unreasonably withheld or delayed.

 

“Extension Term”
means the applicable term for which the Lease may be extended pursuant to the
Extension Options set forth in Section 2.3.

 

“External Causes”
means (i) Acts of God, war, civil commotion, fire, flood or other
casualty, strikes or other extraordinary labor difficulties, shortages of labor
or materials or equipment in the ordinary course of trade, government order or
regulations or other cause not reasonably within the Landlord’s control and not
due to the fault or neglect of the Landlord, and (ii) any act, failure to
act or neglect of the Tenant or the Tenant’s servants, agents, employees,
licensees or any person claiming by, through or under the Tenant, which delays
the Landlord in the performance of any act required to be performed by the
Landlord under this Lease.

 

“Initial Term”
means twenty (20) years.

 

“Land” means the
parcel of land situated in the Town of Wheatfield, Niagara County, described on
Exhibit C attached to and made a part hereof.

 

“Landlord’s
Original Address” has the meaning set forth in Exhibit A.

 

“Landlord’s
Representations and Warranties” means the representations and warranties of the
Landlord as set forth in Section 4.5.

 

“Lease” means this
sublease agreement between Landlord and Tenant.

 

“Lease Year” means
each period of one year during the Term commencing on the Commencement Date or
on any anniversary thereof.

 

“Permitted Uses”
has the meaning set forth in Section 7.1.

 

2

 

“PILOT Agreement”
means the agreement for payment-in-lieu of real estate taxes to be entered into
between the Agency and the Landlord with respect to the Premises.

 

“Premises” and/or “Property”
means collectively the Building and the Land.

 

“Rent Commencement
Date” has the meaning set forth in Section 2.2.

 

“Tenant’s Original
Address” has the meaning set forth in Exhibit A.

 

“Term” means the
Initial Term together with any Extension Term if extended by the Tenant
pursuant to Section 2.3 following Initial Term, whichever is applicable.

 

2.                                       Premises
and Term.

 

2.1                                 Premises.
 The Landlord hereby leases to the
Tenant, and the Tenant hereby leases from the Landlord, for the Term, the
Premises.  The Tenant acknowledges that, except
as expressly set forth in the Lease, there have been no representations or
warranties made by or on behalf of the Landlord with respect to the Premises.  The taking of possession of the Premises by
the Tenant shall conclusively establish that the Premises is at such time in satisfactory
condition and built In accordance with the Plans and Specifications, subject
only to punch list items as hereafter set forth and the Landlord’s
Representations and Warranties.

 

2.2                                 Commencement
Date.  “Commencement Date” means the
date which is the earlier of (i) fifteen (15) days after the date the
Building is completed by Landlord in accordance with the Tenant’s Plans and a
Certificate of Occupancy Issued by the Town of Wheatfield, New York; or (ii) the
date on which the Tenant occupies with Landlord’s permission, any portion of
the Building for the conduct of its business operations.  Landlord and Tenant shall execute an Amendment
to this Lease indicating the actual Commencement and Termination Dates as soon
as ascertained.

 

2.3                                 Extension
Option.  Provided that there exists
no Event of Default uncured as of the Commencement of either of the Extension
Terms, other than any which have been waived by the Landlord, the Tenant shall
have the right to extend the Term hereof for two (2) periods of five (5) years,
each of which such option to extend to be exercised by the giving of written
notice by the Tenant to the Landlord at least nine (9) months prior to the
expiration of the then current term.  Upon
the giving of such notice, this Lease and the Term hereof shall be extended,
for an additional term of five (5) years, without the necessity for the
execution of any additional documents. 
Time is of the essence in the giving of such notice.  The Extension Term shall be upon all the
terms, conditions and provisions of this Lease.

 

3.                                       Rent and Other Payments.

 

3.1                                 Annual
Fixed Rent.  From and after the
Commencement Date the Tenant shall pay, without notice or demand, monthly installments
of one-twelfth (1/12th) of the Annual Fixed Rent in effect and applicable to
the Premises in advance on the first day of each

 

3

 

calendar
month for each full calendar month of the Term and of the corresponding
fraction of said one-twelfth (1/12th) for any fraction of a calendar month at
the beginning or end of the Term.  The
Annual Fixed Rent applicable to the Premises during the Initial Term and any
Extension Term shall be as set forth in Exhibit A.

 

3.2                                 Real
Estate Taxes.  From and after the
Commencement Date, during the Term, the Tenant shall pay, as Additional Rent,
the Tenant’s Tax Expenses for the Premises, in accordance with this Section 3.2.
 The terms used in this Section 3.2
are defined as follows:

 

(a)                                  “Tax
Year” means the 12-month period beginning July 1 each year or if the
appropriate governmental tax fiscal period shall begin on any date other than July 1,
such other date.

 

(b)                                 “The
Tenant’s Tax Expenses” with respect to any Tax Year means the aggregate Real
Estate Taxes on the Property with respect to that Tax Year.

 

(c)                                  “Real
Estate Taxes” means all taxes, including any payment in lieu of taxes required
by the PILOT Agreement and special assessment of every kind and nature assessed
by any governmental authority on the applicable property.  The amount of special taxes or special or
betterment assessments to be included shall be limited to the amount of the installment
(plus any interest thereon) of such special tax or special assessment (which
shall be payable over the longest period permitted by law) required to be paid
during the Tax Year in respect of which such taxes are being determined.  There shall be excluded from such taxes all
income, estate, succession, inheritance, excess profit, franchise and transfer
taxes; provided, however, that if at any time during the Term the present
system of ad valorem lieu of the whole or any part of the ad valorem tax
on real property, there shall be assessed on the Landlord a capital levy or
other tax on the gross rents received with respect to the Property, or a
Federal, State, County, Municipal, or other local income, franchise, excise or
similar tax, assessment, levy or charge (distinct from any now in effect)
based, in whole or in part, upon any such gross rents, then any and all of such
taxes, assessments, levies or charges, to the extent so based, shall be deemed
to be included within the term “Real Estate Taxes.”

 

Payments by the
Tenant on account of the Tenant’s Tax Expenses shall be made by the Tenant
directly to the appropriate taxing authority as and when due, after receipt by
the Tenant of bills therefor and Tenant shall provide the Landlord with
supporting documentation within thirty (30) days thereafter confirming each
such payment.

 

Landlord may
either in its own discretion or upon the request of the Tenant, at any time or
times during the Term, bring a proceeding to contest or seek a refund of any
Real Estate Taxes assessed against the Premises or contest the assessed value
thereof.  Upon the election of the
Landlord not to do so, the Tenant may bring such a proceeding.  In the event such a proceeding results in a
tax or economic benefit to be recognized by the Tenant during the Term or is a
proceeding undertaken by Landlord at Tenant’s request, the Landlord and Tenant
will share equally the reasonable documented out-of-pocket costs of such
successful proceeding such as attorneys fees and appraisal fees.  In the event such proceeding is

 

4

 

unsuccessful, the parties
will share equally the reasonable documented cost of the appraisal only up to a
maximum cost to either party of $2,000.00.  The applicable payment of such costs will be
due within thirty (30) days after receipt of supporting documentation.

 

3.3                                 Operating
Expenses.  From and after the
Commencement Date, during the Term the Tenant shall pay to the Landlord, as
Additional Rent, the cost of insurance provided by Landlord pursuant to Section 8.4.

 

3.4                                 Other
Utility Charges.  During the Term the
Tenant shall pay directly to the provider of the service, all separately
metered charges for steam, heat, gas, electricity, fuel, water, sewer and other
services and utilities furnishes to the Premises.

 

3.5                                 Additional
Services.  If the Tenant requests and
the Landlord elects to provide any services to the Tenant in addition to those
otherwise set forth in the Lease, the Tenant shall pay to the Landlord, as
Additional Rent, the reasonable amount billed by Landlord for such services.  Such services shall be paid for at the time
and in a fashion in which Annual Fixed Rent under this Lease is payable.

 

3.6                                 No
Offsets.  Annual Fixed Rent and
Additional Rent shall be paid by the Tenant without offset, abatement or
deduction, provided, however, that nothing contained herein shall affect or
otherwise impair the ability of Tenant to enforce any final judgment or order
obtained against the Landlord as a result of any default by the Landlord under
this Lease, from such Annual Fixed Rent, Additional Rent or any monies
otherwise due Landlord under this Lease unless and for so long as enforcement
of such judgment or order is stayed pending appeal.

 

3.7                                 Net
Lease.  It is understood and agreed
that this Lease Is a Net Lease and that the Annual Fixed Rent is absolutely net
to the Landlord excepting only the Landlord’s obligations to pay any debt
service on the Property, to perform the Landlord’s obligations pursuant to the
Agency Lease and to perform those obligations of the Landlord expressly set
forth in this Lease.

 

4.                                       Construction
of Improvements.  Subject to the
provisions of Section 4.1 relating to change orders, Landlord shall at a
total cost not to exceed $2,770,000 plus the cost of acquiring the Land:

 

(a)                                  Perform
all Property site work including, but not limited to, grading, paving, curbing,
parking, sidewalks, landscape, utilities, soils test, environmental reports,

 

(b)                                 Construct
on the Property a manufacturing and distribution Building approximately 35,000
square feet, 28,000 of which shall be for manufacturing and distribution space
and the remaining 7,000 square feet for office space.  The exterior of the Building will be a
split-faced block or tilt-up concrete masonry and EIFS System finish with
expansive glass.  The building shall be
built in conformance with Landlord’s Design Drawings and the Tenant’s Plans as
both are defined in Section 4.1,

 

5

 

(c)                                  Maintain,
or cause its general contractor to maintain, a comprehensive builder’s risk
insurance policy insuring the full replacement cost of the Building work until
the date that Landlord delivers possession of the Premises to Tenant in
accordance with Section 2.2, and

 

(d)                                 Landlord
shall assign or cause to be assigned to Tenant as of the Commencement Date, all
warranties from other vendors including without limitation, warranties for
roofing, HVAC, fixtures and other building materials and shall deliver to
Tenant all warranty documentation with respect thereto.

 

4.1                                 Drawings.
 Promptly after the date of this Lease,
Landlord shall submit to Tenant for review by the Consulting Engineer a copy of
Landlord’s schematic design drawing for the Building (“Landlord’s Design
Drawings”) and for the site grading and utility Plans for the property,
prepared by an architect licensed in the State of New York selected by Landlord,
which shall designate the location of major mechanical systems and shall
contain renderings and exterior elevation of the Building, together with a site
plan showing the location of all of the improvements to be located within the
Property.  The Consulting Engineer shall
give Landlord written notice of its approval or give written notice of its
specific objections within-five (5) days after receipt of Landlord’s
Design Drawings.  If the Consulting Engineer
does not respond within said five (5) days, then Landlord may send a
second notice requesting such approval, and if the Consulting Engineer does not
respond within five (5) days from said second notice, then Landlord’s
Design Drawings shall be deemed approved by the Consulting Engineer.  If the Consulting Engineer delivers written notice
of objection to Landlord’s Design Drawings, Landlord and the Consulting
Engineer shall engage in a good faith effort to resolve the objection.  Within forty-five (45) days after Landlord’s
receipt of the Development Approvals Notice (defined in paragraph 4.2) Landlord
shall submit to the Consulting Engineer a copy of detailed plans and
specifications, prepared and stamped by an architect selected by Landlord and
licensed in the State of New York, for the construction of the Building and
sidewalks and landscaping adjacent to the Building, together with detailed plans
and specifications for site grading and utility plans and for all improvements
to be located within the Property (such plans and specifications being
hereinafter called “Tenant’s Plans”).  Tenant’s
Plans shall be consistent with the approved Landlord’s Design Drawings, and
shall be attached hereto and incorporated herein as Exhibit D.  Tenant’s Plans shall be subject to the prior
approval of the Consulting Engineer, which approval shall not be unreasonably
withheld or delayed.  The Consulting
Engineer shall give Landlord written notice of its approval or give written
notice of its specific objections within eight (8) days after receipt of
Tenant’s Plans.  If the Consulting
Engineer does not respond within said eight (8) days then Landlord may
send a second notice requesting such approval, and if the Consulting Engineer does
not respond within five (5) days from said second notice then Tenant’s
Plans shall be deemed approved by the Consulting Engineer.  If the Consulting Engineer delivers written notice
of objection to Tenant’s Plans, Landlord and the Consulting Engineer shall
engage in a good faith effort to resolve the objection.  After Tenant’s Plans have been approved by the
parties, the Tenant’s Plans shall not be changed or modified in any manner by
Landlord or Landlord’s general contractor (a) without the prior approval
and consent of the Consulting

 

6

 

Engineer, which
approval shall not be unreasonably withheld if the requested change does not
alter the character or quality of the Building and does not increase the cost of the
Building or (b) except pursuant to a written change order executed by
Landlord or Landlord’s Contractor and Tenant (“Approved Change Order”)
with any additional cost to be paid by Tenant if so provided in such change
order.  To the extent Tenant is required
to pay for any additional cost pursuant to an Approved Change Order, Landlord
shall provide Tenant with an AIA Form requisition for payment properly
completed and signed by Landlord’s architect for Tenant’s payment obligation
upon completion of the work described in such Approved Change Order, and Tenant
shall deliver payment to Landlord within thirty (30) days of Tenant’s receipt
thereof.

 

4.2                                 Permit
Date. Landlord shall with due diligence from and after Tenant’s Plans and
Specifications have been approved by both Landlord and Tenant, be responsible
for obtaining all zoning, zoning variances, development plan, site plan and
right to build approvals necessary for the construction of the Building.  If zoning, zoning variances, development plan
or right to build approvals are necessary, Landlord shall with due diligence from
and after the date of this Lease, apply for and obtain such approvals. When all
necessary zoning, zoning variances, development plans and right to build
approvals have been obtained, Landlord without delay shall provide written
notice to Tenant (the “Development Approvals Notice”), In addition, Landlord
shall be responsible for obtaining the building permit for the construction of
the Building, and Landlord shall with due diligence from and after Tenant’s Plans
and Specifications have been approved by both Landlord and Tenant, apply for
and seek to obtain the issuance of the building permit. Upon obtaining the
building permit, Landlord without delay shall provide written notice to Tenant.
 The day on which the last necessary governmental
license, permit, certification and approval Is obtained to enable construction
of the Building is referred to herein as the “Permit Date”.

 

4.3                                 Completion
and Acceptance.  Landlord shall in
good faith use its best efforts to complete construction of all Improvements by
January 31, 1999 and to provide sixty (60) days’ prior notice to Tenant,
but in no event less than thirty (30) days’ prior notice to Tenant of the date
Landlord expects to complete Landlord’s Building.  Upon substantial completion of Landlord’s
Building, Tenant shall place and install in the Building, Tenant’s Trade
Fixtures.  The Property shall be treated
as having been substantially completed when the work described in the final
Tenant’s Plans has been substantially completed in accordance with the Tenant’s
Plans except for minor items of work and minor adjustments which shall be the
subject of a punch list as provided below, provided that the status of such
Items does not materially interfere with the Tenant’s proposed use of the
Premises, and the issuance of a Certificate of Occupancy to the Landlord and delivery
of same to the Tenant.  Landlord’s construction
shall be performed in a good and workmanlike manner and in compliance with all
applicable ordinances, orders, rules, regulations and requirements of duly
constituted public authorities.  Tenant
and the Consulting Engineer shall, within Sixty (60) days after Tenant takes
possession of the Building for Installation of Tenant’s Trade Fixtures, provide
to Landlord a “punch list” identifying all items of which Landlord failed to
perform in accordance with Tenant’s Plans, and Landlord shall promptly complete
all items which are reasonably

 

7

 

identified on such punch
list.  Notwithstanding any of the
foregoing, payment of Annual Fixed Rent and Additional Rent shall commence as
provided in Section 2.2.

 

4.4                                 Tenant’s
Right to Inspect Construction.  Tenant
and the Consulting Engineer shall have access to the Premises and Building at
all times during the performance of Landlord’s work and shall be permitted to
inspect Landlord’s work, but shall not Interfere with, delay, interrupt, stop
or correct any such work at the site.  In
the event the Consulting Engineer believes that any of the work is not in
accordance with the Landlord’s Design Drawings or the Tenant’s Plans, the
Consulting Engineer shall provide written notice to the Landlord within
twenty-four (24) hours setting forth in detail such deficiencies.  The Landlord shall then promptly meet with
Landlord’s duly licensed independent professional architect and the Consulting
Engineer to review the alleged deficiencies and take any corrective action as
such architect shall reasonably determine in good faith exercise of its
independent professional judgment.

 

4.5                                 Landlord’s
Representations and Warranties.  To
induce the Tenant to enter into this Lease, Landlord represents and warrants to
the Tenant as follows:

 

(a)                                  Upon
purchase of the Land, Landlord or the Agency will have marketable or insurable
fee title to the Premises free and clear of all liens, encumbrances and restrictions
other than the lien of mortgages granted by the Landlord in connection with financing
the purchase of the Land and/or construction of the Building and restrictions
and utility easements of record that will not impair the intended beneficial use
and occupancy of the Premises by the Tenant under this Lease;

 

(b)                                 The
Premises as of the Commencement Date will be in compliance with all applicable
federal, state and local building codes and zoning laws and environmental laws
and regulations, including laws and regulations relating to wetlands, and there
has not occurred at the Premises any release of Hazardous Materials or
Hazardous Substances as defined in Section 7.3(a); and

 

(c)                                  Except
for matters expressly covered by any express third party warranty described in Section 4(d),
Landlord warrants and shall cause its contractor to warrant for a period of one
(1) year from the Commencement Date, that the Premises and Building have
been built in accordance with the Landlord’s Design Drawings and the Tenant’s
Plans and are free from defects in materials and workmanship.

 

5.                                       Alterations.

 

5.1                                 The
Tenant shall not make alterations or additions to the Building except with the
prior approval of the Landlord, which approval shall not be unreasonably
withheld or delayed.  The Landlord shall
not be deemed unreasonable for withholding approval of any alterations or
additions which (i) involve or might materially alter any structural or
exterior element of the Building or any area or element of the Property, (ii) will
require unusual expense to readapt the Property to normal use unless the Tenant
first gives assurance

 

8

 

acceptable to the
Landlord that such readaptation will be made prior to such termination without
expense to the Landlord, or (iii) which would not be compatible with
existing mechanical or electrical, plumbing, HVAC or other systems in the
Building, in each case, as reasonably determined by the Landlord.

 

5.2                                 Ownership
of Alterations.  All alterations and
additions which are permanently affixed to the Building and cannot be removed
without causing substantial structural damage, shall be part of the Building
and owned by the Landlord.  All other
alterations and additions may be removed by the Tenant within its discretion at
Tenant’s expense and Tenant shall repair any damage caused by such removal.

 

5.3                                 Construction
Requirements for Alterations.  All
construction work by the Tenant shall be done in a good and workmanlike manner
employing only first class materials and in compliance with all applicable laws
and all lawful ordinances, regulations and orders of Governmental authority and
insurers of the Property.  The Landlord
or Landlord’s authorized agent may (but without any implied obligation to do
so) inspect the work of the Tenant at reasonable times and shall give notice of
observed defect.  All of the Tenant’s
alterations and additions and installation of furnishings shall be coordinated
with any work being performed by the Landlord and in such manner as to maintain
harmonious labor relations and not to damage the Building or interfere with
Building construction or operation and, except Installation of furnishings,
shall be performed by the Landlord’s general contractor or by contractors or
workmen first approved by the Landlord, which approval the Landlord agrees not
to unreasonably withhold or delay.  The
Tenant, before starting any work, shall receive and comply with Landlord’s
reasonable construction rules and regulations and shall cause Tenant’s
contractor(s) to comply therewith, shall secure all licenses and permits
necessary therefor and shall deliver to the Landlord a statement of the names
of all its contractors and subcontractors and the estimated cost of all labor
and material to be furnished by them and in any case where the estimated cost
of construction will exceed $500,000, shall furnish security reasonably
satisfactory to the Landlord protecting the Landlord against liens arising out
of the furnishing of such labor and material; and cause each contractor to
carry worker’s compensation insurance in statutory amounts covering all the
contractors’ and subcontractors employees and comprehensive general public
liability insurance with aggregate limits of not less than $3,000,000 or as the
Agency may reasonably require, covering personal Injury and death and property
damage (all such insurance to be written in companies approved reasonably by
the Landlord and insuring the Landlord, such individuals and entities
affiliated with the Landlord as the Landlord may designate, and the Tenant as
well as the contractors and to contain a requirement for at least thirty (30)
days notice to the Landlord prior to cancellation, non-renewal or material
change, and to deliver to the Landlord certificates of all such insurance.

 

5.4                                 Payment
for Tenant Alterations.  The Tenant
agrees to pay promptly when due the entire cost of any work done on the
Premises by the Tenant, its agents, employees Independent contractors performed
or furnished in connection therewith so as not to allow any mechanics lien to
attach to the to the Building or the Property and promptly to discharge any
such liens which may so attach.  If any
such lien shall be filed against the Building or the

 

9

 

Property and the Tenant
shall fail to cause such lien to be discharged within ten (10) days after
the filing thereof, the Landlord may cause such lien to be discharged by
payment, bond or otherwise, without investigation as to the validity thereof or
as to any offsets or defenses which the Tenant may have with respect to the
amount claimed.  The Tenant shall
reimburse the Landlord, as Additional Rent, for any cost so incurred and shall
indemnify and hold harmless the Landlord from and against any and all claims,
costs, damages, liabilities and expenses (including reasonable attorney’s fees)
which may be incurred or suffered by the Landlord by reason of any such lien or
its discharge.

 

6.                                       Maintenance
Repairs and Replacements.

 

6.1                                 Landlord’s
Responsibilities.  Except as set
forth in Section 6.2, Landlord shall at its sole cost and expense, make
such repairs and replacements to (a) the major structural components of
the Building including all exterior walls and floor slabs, but excluding the
exterior of the roof and roof deck, (b) the components of the water,
sewer, gas and electrical systems leading to the Building including mains,
laterals and transformers, (c) the parking lot and (d) the exterior
lighting fixtures (but not bulbs, which shall be the Tenant’s responsibility)
located on the Premises, all as may be necessary to keep and maintain the same in
serviceable condition during the Term, unless and to the extent that such
repair or replacement is necessitated by the negligent or intentional act of
the Tenant, its employees, servants or agents, in which case the Tenant shall
pay the reasonable documented cost thereof.

 

6.2                                 Tenant’s
Responsibilities.  Tenant shall at
its sole cost and expense:

 

(a)                                  keep
the Premises neat and clean,

 

(b)                                 maintain
and make all repairs and replacements to (i) the exterior of the roof and
roof deck, (ii) all non-structural components of the Building and (iii) the
plumbing, heating, air conditioning, electrical and sprinkler systems (if any)
located on and within the Building,

 

(c)                                  arrange
for all ordinary repairs and maintenance (but not replacements or repaving
since same are the responsibility of the Landlord) to the parking lot, including
striping, minor patching, sealing and snowplowing, and

 

(d)                                 arrange
for all lawn and shrubbery care and replacement as needed and garbage removal,

 

as in the reasonable
judgment of the Landlord is necessary to keep the same in good appearance,
order and repair during the Term, except for the Landlord’s Responsibilities in
Section 6.1 and further excepting those repairs for which the Landlord is
responsible by reason of fire or other casualty and as a consequence of the
exercise of the power of eminent domain and shall surrender the Property and
all alterations and additions thereto not removed by Tenant pursuant to Section 5.2,
at the end of the Term, in such condition, first removing all goods, fixtures
and effects of the Tenant and, to the extent specified by the Landlord by
notice

 

10

 

to the Tenant, all
alterations and additions made by the Tenant and repairing any damage caused by
such removal and restoring the Property and leaving them clear and neat.  The Tenant shall not permit or commit any
waste and shall be responsible for repairs which may be necessary by reason of
damages caused by the Tenant or any of the contractors, suppliers, or invitees
of the Tenant.

 

6.3                                 Delays
in landlord’s Services.  The Landlord
shall not be liable to the Tenant for any compensation or reduction of rent by
reason of inconvenience or annoyance or for loss of business arising from the
necessity of the Landlord or its agents entering the property for any purposes
authorized in this Lease, or for repairing the Property or any portion of the
Building, excepting that caused by Landlord’s (or Landlord’s servants, agents,
or employees) negligent or intentional acts. 
In case the Landlord is prevented or delayed from making any repairs,
alterations or improvements, or furnishing any services or performing any other
covenant or duty to be performed on the Landlord’s part, by reason of any
External Cause, the Landlord shall not be liable to the Tenant therefor, nor,
except as expressly otherwise provided in this Lease, or except as the same may
be caused by Landlord’s (or  Landlord’s
servants, agents, or employees) negligent or intentional acts, shall the Tenant
be entitled to any abatement or reduction of rent by reason thereof, nor shall
the same give rise to a claim in the Tenant’s favor that such failure
constitutes actual or constructive, total or partial, eviction from the
Premises.

 

The Landlord
reserves the right to stop any service or utility system when necessary by
reason of accident or emergency, until necessary repairs have been completed,
provided, however, that in each instance of stoppage, the Landlord shall
exercise reasonable diligence to eliminate the cause thereof.  Except in case of emergency repairs, the
Landlord will give the Tenant reasonable prior notice and reasonable
opportunity to avoid unnecessary inconvenience to the Tenant by reason thereof.  In no event shall the Landlord have any
liability to the Tenant for the unavailability of heat, light or any utility or
service to be provided by the Landlord to the extent that such unavailability
is caused by External Causes.

 

7.                                       Tenant
Covenants.  The Tenant covenants
during the Term and for such further time as the Tenant occupies any part of
the Property:

 

7.1                                 Permitted
Uses.  The Tenant shall occupy the
Property for Manufacturing and Distribution with office use incidental thereto
and any such other use as Landlord and Tenant may agree to in writing from
time-to-time, but no other use.  The
Tenant shall comply with all requirements of public authorities and of the
Board of Fire Underwriters in connection with methods of storage, use and
disposal of Tenant’s equipment and inventory. 
The Tenant shall not permit in the Property any activity that
constitutes a nuisance as determined by principles of law, or the emission from
the Property of any noise, odor, or vibration in excess of limits allowed by
applicable federal, state or local law, without in each case receiving an
appropriate permit therefor, nor use or devote the Premises or any part thereof
for any purpose which is contrary to law or ordinance or liable to invalidate
or Increase premiums for any insurance on the Building or Its contents or
liable to render necessary any alteration or addition to the Building, nor
commit or permit any waste in or with respect to the Property.

 

11

 

7.2                                 Laws,
and Regulations.  The Tenant shall
comply with all federal, state and local laws, regulations, ordinances,
executive orders and similar requirements in effect from time to time
applicable to its use and occupancy of the Property except as to any federal,
state and local laws, regulations, ordinances, executive orders or similar
requirements, the enforcement of which Tenant is contesting by appropriate
proceedings diligently conducted and pursued, provided Tenant has not been
enjoined from contesting same, the failure to so comply does not result in the
creation or continuation of any activity that constitutes a nuisance as
determined by principles of law and Tenant has provided reasonable prior notice
to the Landlord of its intent to contest the foregoing with reasonable notice
thereafter of the progress of such contest.

 

7.3                                 Hazardous
Materials.

 

(a)                                  For
purposes of this Lease, “Hazardous Materials” means any explosives, radioactive
materials, hazardous wastes, or hazardous substances, including without
limitation substances defined as “hazardous substances” in the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended 42 U.S.C. 9601-9657;
the Hazardous Materials Transportation Act of 1975, 449 U.S.C. 1801-1812;
the Resource Conservation and Recovery Act of 1976, 42

U.S.C. 6901-6987; or any other federal, state or local statute, law,
ordinance, code, rule, regulation, order, or decree regulating, relating to, or
imposing liability or standards of conduct concerning hazardous materials, waste,
including infectious waste, or substances now or at any time hereafter in
effect (collectively, “Hazardous Materials Laws”).

 

(b)                                 Tenant
will not cause or permit the storage, use, generation, or disposition of any
Hazardous Materials in, on, or about the Property or the Building by Tenant, its
agents, employees, or contractors, except in accordance with applicable
federal, state or local laws or regulations.  Tenant will not permit the Property to be used
or operated in a manner that may cause the Property or the Building to be
contaminated by any Hazardous Materials in violation of any Hazardous Materials
Laws.  Tenant will immediately advise Landlord
in writing of (i) any and all enforcement, cleanup, remedial, removal, or
other governmental or regulatory actions instituted, completed, or threatened
pursuant to any Hazardous Materials laws relating to any Hazardous Materials
affecting the Property; and (ii) all claims made or threatened by any
third party against Tenant, Landlord, or the Property relating to damage,
contribution, cost recovery, compensation, loss or Injury resulting from any
Hazardous Materials on or about the Property. 
Without Landlord’s prior written consent, which consent will not be unreasonably
withheld or delayed, Tenant will not take any remedial action or enter into any
agreements or settlements in response to the presence of any Hazardous
materials in, on or about the Property.

 

(c)                                  Tenant
agrees, at its sole cost and expense, to comply with all federal, state and
local laws in connection with the disposal of Infectious Waste.  Infectious Waste shall be segregated into
plastic bags which are impervious to moisture and have a strength sufficient to
preclude ripping, tearing, or bursting under normal conditions of usage

 

12

 

and of handling.  Each exterior bag shall be red in color.  Sharps (needles, syringes and scalpels) shall
be contained in disposable, rigid, puncture proof containers which are taped
closed or tightly lidded to preclude loss of contents and clearly labeled “SHARPS”.

 

As used herein,
the term “Infectious Waste” shall include: (1) wastes deemed infectious by
the generator; (2) cultures and stocks of infectious agents, including
specimen cultures, wastes from the production of biologicals and discarded live
vaccines; (3) laboratory wastes; (4) pathological wastes; (5) animal
carcasses; (6) human and animal blood specimens or products; (7) patient
wastes such as bandages and disposable gowns; (8) sharp wastes; and (9) any
material generated by research facilities 
pertaining to the production or testing of biological agents.

 

(d)                                 Tenant
will be solely responsible for and will defend, indemnify and hold Landlord,
its agents, and employees harmless from and against all claims, costs and
liabilities, including reasonable attorney’s fees and costs, arising out of or
in connection with Tenant’s breach of its obligations in this Section 7.3.  Tenant will be solely responsible for and
will defend, indemnify, and hold Landlord, its agents, and employees harmless
from and against any and all claims, costs, and liabilities, including
reasonable attorney’s fees and costs, arising out of or in connection with the
removal, cleanup, and restoration work and materials necessary to return the
Property and any other property of whatever nature located on the Building to
their condition existing prior to the appearance of Tenant’s Hazardous
Materials or Infectious Waste on the Property. 
Tenant’s obligations under this Section 7.3 will survive the
expiration or other termination of this Lease.

 

7.4                                 Safety
Compliance.  The Tenant shall keep
the Property equipped with all safety appliances required by law or ordinance
or any other regulations of any public authority because of any use made by the
Tenant and to procure all licenses and permits so required because of such use
and, if requested by the Landlord, do any work so required by any such law,
ordinance or regulation, because of such use, it being understood that the foregoing
provisions shall not be construed to broaden in any way the Tenant’s Permitted Uses.

 

7.5                                 Landlord’s
Entry.  The Landlord and its agents
shall have the right, but not the duty, upon reasonable prior notice to the
Tenant and only when accompanied by a representative of Tenant, except in cases
of emergency when prior notice cannot reasonably be given, to inspect the
property at anytime to determine whether the Tenant is complying with the Terms
of this Lease and to enter the Property at all reasonable hours for the purpose
of inspecting, or to fulfill any Landlord obligation and to show the Property
to prospective purchasers and mortgagees.

 

7.6                                 Floor
Load.  The Tenant shall not place a
load upon any floor in the Property exceeding the floor load per square foot of
area which such floor was designed to carry and which is allowed by law; and
not move any safe, vault or other heavy equipment in, about or out of the
Property except in such manner and at such time as the Landlord shall in each
instance reasonably authorize consistent with the foregoing.  The Tenant’s machines

 

13

 

and mechanical equipment
shall be placed and maintained by the Tenant at the Tenant’s expense in
settings sufficient to absorb or prevent vibration or noise that may be
transmitted to the Building structure or to any other space in the Building.

 

7.7                                 Personal
Property Tax.  The Tenant shall pay
promptly when due all taxes which may be imposed upon personal property
(including, without limitation, fixtures and equipment) in the Premises to
whomever assessed other than taxes contested by appropriate proceedings
diligently conducted and pursued and of which proceedings Landlord is given
prior notice and reasonable notice thereafter of the progress thereof.

 

7.8                                 Assignment
and Subleases.  Except as otherwise
provided herein, the Tenant shall not assign, mortgage, pledge, hypothecate or
otherwise transfer this Lease voluntarily or by operation of law, or sublet
(which term without limitation, shall include granting of concessions, licenses
and the like) the whole or any part of the Premises without in each instance,
having first received the consent of the Landlord which consent shall not be unreasonably
withheld or delayed.  Any assignment or
sublease made without such consent shall be void.  Whether or not the Landlord consents to any
assignment or subletting, the Tenant named herein shall remain fully and
primarily liable for the obligations of the tenant hereunder, including,
without limitation, the obligation to pay Annual Fixed Rent and Additional Rent
provided under this Lease.  The Tenant
shall give the Landlord notice of any proposed sublease or assignment,
specifying the provisions of the proposed subletting or assignment, including (i) the
name and address of the proposed subtenant or assignee, (ii) the subtenant’s or
assignee’s most recent annual financial statement, (iii) all of the terms and
provisions upon which the proposed subletting or assignment is to be made and
such other information concerning the proposed subtenant or assignee as the
Tenant has obtained in connection with the proposed subletting or assignment.  The Tenant shall reimburse the Landlord
promptly for reasonable legal and other expenses incurred by the Landlord in connection
with any request by the Tenant for consent to any assignment or subletting.  If this Lease is assigned, or if the Premises
or any part thereof is sublet or occupied by anyone other than the Tenant, the Landlord
may, at any time and from time to time, collect rent and other charges from the
assignee, sublessee or occupant and apply the net amount collected to the rent
and other charges herein reserved, but no such assignment, subletting,
occupancy or collection shall be deemed a waiver of the prohibition contained
in this Section 7.8 or the acceptance of the assignee, sublessee or
occupant as a tenant, or a release of covenants on the part of the Tenant
herein contained (Tenant’s liability to be primary, joint and several with
assignee or subtenant).  The consent by
the Landlord to an assignment or subletting shall not be construed to relieve
the Tenant from obtaining the express consent in writing of the Landlord to any
further assignment or subletting.

 

The Landlord shall
not be deemed to be unreasonable in withholding its consent to any proposed assignment or subletting by the
Tenant based on any of the following factors:

 

(a)                                  The
business of the proposed occupant is not consistent with the use that Landlord
desires for the Property.

 

14

 

(b)                                 The
proposed occupant would occupy less than all of the Tenant’s space.

 

(c)                                  The
Tenant shall pay to the Landlord Fifty percent (50%) of the amount the Tenant
receives from any subtenant or assignee as rent, additional rent or other form
of compensation or reimbursement in excess of (i) the Annual Fixed Rent,
Additional Rent and other monies otherwise due to the Landlord pursuant to this
Lease (allocable in the case of at sublease to that portion of the Premises
being subleased), and (ii) any reasonable expenses incurred and paid by
the Tenant in connection with such sublease or assignment such as brokerage
commissions, fees for legal services and expenses of preparing the Premises for
occupancy by such subtenant or assignee.

 

Notwithstanding
anything contained herein to the contrary, Tenant may assign this Lease or
sublet all or any portion of the Premises to any entity affiliated with Tenant
such as a parent, subsidiary, brother-sister entity, an entity of which the
voting control is owned by Joel E. Bickell, Peter Bickel and/or Robert Gould
and to any successor entity to Tenant by merger or consolidation, provided,
however, that Tenant shall provide prior written notice to Landlord accompanied
by the information required to be provided to Landlord in the beginning of this
Section 7.8 and Tenant shall remain jointly and severally and primarily
liable with any assignee or subtenant under this Lease.

 

8.                                       Indemnity
and Insurance.

 

8.1                                 Indemnity.  To the maximum extent this agreement may be
made effective according to law, the Tenant agrees to indemnify and save
harmless the Landlord from and against all claims of whatever nature arising
from any act, omission or negligence of the Tenant, or the Tenant’s
contractors, licensees, invitees, agents, servants or employees, or arising
from any accident, injury or damage whatsoever caused to any person or
property, occurring after the date that possession of the Property is first
delivered to the Tenant and until the end of the Term and thereafter, so long
as the Tenant is in occupancy of any part of the Property, in or about the
Property except to the extent any such claim is due to the act or neglect of
the Landlord, its contractors, licensees, invitees, agents, servants or
employees.  This indemnity and hold
harmless agreement shall include indemnity against reasonable attorneys fees
and all other reasonable costs, expenses and liabilities incurred or in
connection with any such claim or proceeding brought thereon, and the defense
thereof.

 

To the maximum
extent this agreement may be made effective according to law, the Landlord
agrees to indemnify and save harmless the Tenant from and against all claims of
whatever nature arising from any act, omission or negligence of the Landlord,
or the Landlord’s contractors, licensees, invitees, agents, servants or
employees, or arising from any accident, injury or damage whatsoever caused to
any person or property, occurring after the date that possession of the
Property is first delivered to the Tenant and until the end of the Term and
thereafter, so long as the Tenant is in occupancy of any part of the Property,
in or about the Property, except to the extent any such claim is due to the act
or neglect of the

 

15

 

Tenant, its contractors,
licensees, invitees, agents, servants or employees.  This indemnity and hold harmless agreement
shall include indemnity against reasonable attorneys fees and all other
reasonable costs, expenses and liabilities incurred or in connection with any
such claim or proceeding brought thereon, and the defense thereof.

 

8.2                                 Liability
Insurance.  The Tenant agrees to
maintain in full force from the date upon which the Tenant first enters the
Premises for any reason, throughout the Term, and thereafter, so long as the
Tenant is in occupancy of any part of the Premises, a policy of comprehensive
general liability insurance under which the Landlord ( and any individuals or
entities affiliated with the Landlord, and any holder of a mortgage on the
property of whom the Tenant is notified by the Landlord ) is named as insured,
and under which the insurer provides a contractual liability endorsement
insuring against all cost, expense and liability arising out of or based upon
any and all claims, accidents, injuries and damages for which the Landlord is
entitled to indemnity under Section 8.1, in the broadest form of such coverage
from time to time available.  Each policy
shall be noncancellable and nonamendable (to the extent that any proposed
amendment reduces the limits or the scope of the insurance required in this
lease ) with respect to the Landlord and mortgagees without thirty (30) days
prior notice to the Landlord and mortgagees and at the election of the
Landlord, either a certificate of insurance or a duplicate original policy
shall be delivered to the Landlord.  The
minimum limits of liability of such insurance as of the Commencement Date shall
be Three Million Dollars ($3,000,000.00) for combined bodily injury or death
and damage to property (per occurrence) or such other limits as are required by
the Agency under the Agency Lease, and from time to time during the Term such
limits of liability shall be increased to reflect such higher limits as are
appropriate for such risks at that time and subject to then current market
conditions for such insurance.

 

8.3                                 Personal
Property Risk.  The Tenant agrees
that all of the furnishings, fixtures, equipment, effects and property of every
kind, nature and description of the Tenant and of all persons claiming by,
through or under the Tenant which, during the continuance of this Lease or any
occupancy of the Premises by the Tenant or anyone claiming under the Tenant,
may be on the Property shall be at the sole risk and hazard of the Tenant and
if the whole or any part thereof shall be damaged by fire, water or otherwise,
or by leakage or bursting of water pipes, steam pipes, or other pipes, by theft
or any other cause, no part of said loss or damage is to be charged to or be
borne by the Landlord, except that the Landlord shall in no event be exonerated
from any liability to the Tenant or to any person, for any injury, loss, damage
or liability to the extent such exoneration is prohibited by law.

 

8.4                                 Landlord’s
Insurance.  The Landlord shall carry
such casualty and liability insurance upon and with respect to the Property as
may from time to time be deemed reasonably prudent by the Landlord or required
by any mortgagee holding a mortgage thereon
and in any event, insurance against loss by fire and all risks including loss
of rents, now covered by extended coverage for the full replacement cost of the
Property or in any greater amount the Landlord’s mortgagee deems reasonable and
appropriate.  Notwithstanding the
foregoing, Landlord shall provide a description and the anticipated premium
cost to Tenant before each policy is purchased or renewed.  Tenant shall have the right at any time or
times

 

16

 

during the Term to obtain
competitive quotes from other insurance companies of comparable standing to
those proposed by the Landlord and acceptable to the Agency and Landlord’s
mortgagee and the Landlord may elect to match the competitive quotes obtained
by Tenant and if Landlord does not do so, Tenant may at its option select one
or more insurance companies issuing such competitive quotes, with the consent
of the Landlord, which consent will not be unreasonably withheld or delayed.

 

8.5                                 Waiver
of Subrogation.  Any insurance
carried by either party with respect to the Building, Premises, or any property
therein or occurrences thereon shall, without further request by either party,
if it can be so without additional premium, or with an additional premium which
the other party elects to pay, include a clause or endorsement denying to the
insurer rights of subrogation against the other party to the extent rights have
been waived by the insured prior to occurrence of injury or loss.  Each party, notwithstanding any provisions of
this Lease to the contrary, hereby waives any rights of recovery against the other
for injury or loss, including, without limitation, injury or loss caused by
negligence of such other party, due to hazards covered by insurance containing
such clause or endorsement to the extent of such insurance coverage.

 

9.                                       Casualty
and Eminent Domain.

 

9.1                                 Restoration
Following Partial Damage.  If, during
the Term, the Building or Premises shall be partially damaged by fire or
casualty, subject to the exceptions and limitations provided below, the
Landlord shall repair or restore the Building or Premises within ninety (90)
days thereafter, to substantially the condition thereof immediately prior to
such damage, but the Landlord shall not be responsible for delay in such repair
or restoration due to External Causes.  Tenant’s
liability for Annual Fixed Rent and Additional Rent and other charges shall
abate as of the date of such casualty in a proportion equal to the portion of
the Premises damaged.  If the cost to
repair or restore the Building exceeds $300,000, the Landlord shall have no
obligation to expend in the repair or reconstruction of the Building more than
the actual amount of the insurance proceeds made available to the Landlord by
its insurer and not retained by the Landlord’s mortgagee.  Landlord shall make diligent good faith efforts
to promptly file an appropriate claim for such insurance proceeds and obtain
the consent of the Landlord’s mortgagee thereto.  Any repair or restoration of the Building or
the Premises shall be altered to the extent necessary to comply with then
current laws and applicable codes.

 

9.2                                         Restoration
or Termination Following Total damage or Destruction.  In the event the Premises are damaged or
destroyed by fire or other casualty:

 

(a)                                  during
the last eighteen (18) months of the Initial Term (provided Tenant has not
elected to extend the Term pursuant to Section 2.3 prior to the date of
said damage or destruction or any Extended Term); or

 

(b)                                 such
that the Premises are totally destroyed or are rendered substantially or wholly
untenantable; or

 

17

 

(c)                                  such
that more than fifty percent (50%) of the Premises are damaged or destroyed and
cannot be repaired with reasonable diligence so as to be fit for occupancy
within two hundred (200) days following the date of such casualty; or

 

(d)                                 after
filing an appropriate claim, the Landlord has reasonably determined there are
not or will not be sufficient insurance proceeds to cover not less than ninety
percent (90%) of the cost of repairing or restoring the Building or Premises or
the Landlord’s mortgagee of the Property will not release such insurance
proceeds to Landlord for any reason other than the existence of an event of
default due to Landlord’s non-performance under the mortgage, and has so
notified the Tenant within ninety (90) days following the date of such casualty,

 

then and in any
such event, Landlord or Tenant may elect, by written notice delivered to the
other party within thirty (30) days following the date of such casualty upon
the occurrence of an event described in paragraphs (a), (b) or (c) above
or within thirty (30) days after the notification from the Landlord to Tenant
under paragraph (d) above, to terminate this Lease, in which event this
Lease shall terminate as of the date of such casualty as if such date was the
date specified herein for expiration of the Term hereof.

 

In the event
neither Landlord nor Tenant elects to terminate this Lease as aforesaid, Landlord
shall promptly commence and diligently prosecute to completion the restoration
or reconstruction of those portions of the Premises damaged or destroyed by
such casualty, and Tenant’s liability for Annual Fixed Rent, Additional Rent
and other charges shall abate as of the date of such casualty in a proportion
equal to the portion of the Premises rendered substantially or wholly
untenantable by such casualty until the repair or reconstruction is completed
so as to render the Premises fit for occupancy.

 

In the event
Landlord fails to substantially complete the repair or reconstruction of the
Premises within two hundred (200) days following the date of such casualty such
that the Premises are ready for occupancy and resumption of Tenant’s business
operations, unless such failure is due to External Causes, Tenant may elect, by
written notice delivered to the Landlord within five (5) days following
expiration of said two hundred (200) day period, to terminate this Lease, in
which event this Lease shall terminate as of the date of such casualty as if
such date was the date specified herein for expiration of the Term hereof.

 

9.3                                 Eminent
Domain.  Except as hereinafter
provided, if the Premises, or such portion thereof as to render the balance (if
reconstructed to the maximum extent practicable in the circumstances)
unsuitable for the Tenant’s purposes, shall be taken by condemnation or right
of eminent domain, the Landlord or the Tenant shall have the right to terminate
this Lease by notice to the other of its desire to do so, provided that such
notice is given not later than thirty (30) days after the effective date of
such taking.  If so much of the Building
shall be so taken that the Landlord determines that it would be appropriate to
raze or substantially alter the Building, the Landlord shall have the right to
terminate this Lease by giving notice to the

 

18

 

Tenant of the Landlord’s
desire to do so not later than thirty (30) days after the effective date of
such taking.

 

Should any part of
the Premises be so taken or condemned during the Term, and should this Lease be
not terminated in accordance with the foregoing provisions, the Landlord agrees
to use reasonable efforts to put what may remain of the Premises into proper
condition for use and occupation as nearly like the condition of the Premises
prior to such taking as shall be practicable, subject, however, to applicable
laws and codes then in existence and to the availability of sufficient proceeds
from the eminent domain taking not retained by any mortgage or ground lessor.

 

9.4                                 Rent
After Casualty or Taking.  If the
Premises shall be damaged by fire or other casualty, the Annual Fixed Rent and
Additional Rent shall not abate except to the extent that the Landlord is fully
compensated therefor by any lost rent insurance maintained by Landlord at
Tenant’s expense pursuant to Section 8.4.

 

In the event of a
taking which permanently reduces the area of the Premises, a just proportion of
the Annual Fixed Rent shall be abated for the remainder of the Term.

 

9.5                                 Temporary
Taking.  In the event of any taking
of the Premises other than the Building or any part thereof for a temporary use
not in excess of six (6) months which does not materially interfere with
or impair the Tenant’s use and occupancy of the Premises, (i) this Lease
shall be and remain unaffected thereby and Annual Fixed Rent and Additional
Rent shall not abate, and (ii) the Tenant shall be entitled to receive for
itself such portion and portions of any award made for such use with respect to
the period of the taking which is within the Term.

 

9.6                                 Taking
Award.  The Landlord shall have and
hereby reserves and excepts, and the Tenant hereby grants and assigns to the
Landlord, all rights to recover for damages to the Building and the Land, and
the leasehold interest hereby created, and to compensation accrued or hereafter
to accrue by reason of such taking, damage or destruction, as aforesaid, and by
way of confirming the foregoing, the Tenant hereby grants and assigns to the Landlord,
all rights to such damages or compensation. 
Nothing contained herein shall be construed to prevent the Tenant from
prosecuting in any condemnation proceedings a claim for relocation expenses
non-permanent alterations and trade fixtures as described in Section 5.2
provided that such action shall not affect the amount of compensation otherwise
recoverable by the Landlord from the taking authority pursuant to the preceding
sentence.

 

10.                                 Default.

 

10.1                           Tenant’s
Default.  Each of the following shall
constitute an Event of Default:

 

(a)                                  Failure
on the part of the Tenant to pay the Annual Fixed Rent, Additional Rent or
other charges for which provision is made herein on or before the date on

 

19

 

which the same become due
and payable, if such condition continues for ten (10) days after the same are
due.

 

(b)                                 Failure
on the part of the Tenant to perform or observe any other term or condition
contained in this Lease and/or failure to continuously occupy the Property for
a period in excess of forty-five (45) days, if the Tenant shall not cure such
failure within forty-five (45) days after notice from the Landlord to the
Tenant thereof, provided that in the case of breaches of obligations under this
Lease which are susceptible to cure but cannot be cured within forty-five (45)
days through the exercise of due diligence, so long as the Tenant commences
such cure within forty-five (45) days, such breach remains susceptible to cure,
and the Tenant diligently pursues such cure, such breach shall not be deemed to
create an Event of Default.

 

(c)                                  The
taking of the estate hereby created on execution or by other process of law; or
a judicial declaration that the Tenant is bankrupt or insolvent according to
law; or any assignment of the property of the Tenant for the benefit of
creditors; or the appointment of a receiver, guardian, conservator, trustee in
bankruptcy or other similar officer to take charge of all or any substantial
part of the Tenant’s property by a court of competent jurisdiction; or the
filing of an involuntary petition against the Tenant under any provisions of
the bankruptcy act now or hereafter enacted; the filing by the Tenant of any
voluntary petition for relief under provisions of any bankruptcy law now or
hereafter enacted and with respect to any of the above commenced or instituted
against the Tenant, the failure of Tenant to stay or discharge same within
ninety (90) days thereafter.

 

If an Event of
Default shall occur, then, in any such case, whether or not the Term shall have
begun, the Landlord lawfully may, immediately or at any time thereafter, give
notice to the Tenant specifying the Event of Default and this Lease shall come
to an end on the date specified therein as fully and completely as if such date
ware the date herein originally fixed for the expiration of the Lease Term, and
the Tenant will then quit and surrender the Premises to the Landlord, but the
Tenant shall remain liable as hereinafter provided.

 

10.2                           Damages.  In the event that this Lease is terminated,
the Tenant shall pay punctually to the Landlord all the sums including, but not
limited to, Annual Fixed Rent and Additional Rent (Periodic Payments) and
perform all the obligations which the Tenant covenants in this Lease to and to perform
in the same manner and to the same extent and at the same time as if this Lease
had not been terminated.  In calculating
the amounts to be paid by the Tenant under the foregoing covenant, the Tenant
shall be credited with the net proceeds of any rent obtained by reletting the
Premises, after deducting all the Landlord’s expenses in connection with such
reletting, including, without limitation, all repossession costs, brokerage
commissions, reasonable fees for legal services and expenses of preparing the
Premises for such reletting.  The Tenant
shall also be entitled to credit against the last Periodic Payment which would
otherwise become due for the amount, if any, paid to the Landlord as damages
awarded to Landlord as a result of any action commenced against the Tenant to
enforce this Lease.  The Landlord may (i) relet
the Premise, or any part or parts thereof, for a

 

20

 

term or terms which may,
at the Landlord’s option, exceed or be equal to or less than the period which
would otherwise have constituted the balance of the Term, and may grant such
concessions and free rent as the Landlord in its reasonable commercial judgment
considers advisable or necessary to relet the same and (ii) make such
alterations, repairs and improvements in the Premises as the Landlord in its
reasonable commercial judgment considers advisable or necessary to relet the
same.  No action of the Landlord in
accordance with the foregoing or failure to relet or to collect rent under
reletting shall operate to release or reduce the Tenant’s liability.  The Landlord shall be entitled to seek to
rent other properties of the Landlord prior to reletting the Premises.  The Landlord shall make reasonable efforts to
mitigate its damages upon the occurrence of an Event of Default by Tenant.

 

10.3                           Landlord’s
Default.  In the event of the failure
on the part of the Landlord to perform or observe any term or condition
contained in this Lease or the Agency Lease, and if the Landlord shall not cure
such failure within forty-five (45) days after notice from the Tenant to the
Landlord thereof (provided that in the case of breaches or obligations under
this Lease which are susceptible to cure but cannot be cured within forty-five
(45) days through the exercise of due diligence, so long as the Landlord
commences such cure within forty-five (45) days, such breach remains
susceptible to cure and the Landlord diligently pursues such cure, such breach
shall not be deemed to create an event of default by Landlord), Tenant may exercise
such remedies as may exist at law or equity as a result of such event of
default by the Landlord.  Nothing
contained in this Section 10.3 shall be deemed to extend those time periods
or require any additional notices to the Landlord under Section 9.2.

 

10.4                           Cumulative
Rights.  The specific remedies to
which a party may resort under the terms of this Lease are cumulative and are
rot intended to be exclusive of any other remedies or means or redress to which
it may be lawfully entitled in case of any breach or threatened breach by the
other party of any provisions of this Lease. 
In addition to the other remedies provided in this Lease, a party shall
be entitled to the restraint by injunction of the violation or attempted or
threatened violation of any of the covenants, conditions or provisions of this
Lease or to a decree compelling specific performance of any such covenants,
conditions or provisions.  Nothing
contained in this Lease shall limit or prejudice the right of the Landlord to
prove for and obtain in proceedings for bankruptcy, insolvency or like
proceedings by reason of the termination of this Lease, an amount equal to the
maximum allowed by any statute or rule or law in effect at the time when,
and governing the proceedings in which, the damages are to be proved, whether
or not the amount be greater, equal to, or less than the amount of the loss or
damages referred to above.

 

10.5                           Landlord’s
or Tenant’s Self-help.  If a party
shall at any time default in the performance of any obligation under this
Lease, the other party shall have the right, but not the obligation, upon
reasonable, but in no event more than ten (10) days’, notice to such other
party (except in case of emergency in which case no notice need be given), to
perform such obligation.  A party may
exercise its rights under this Section without waiving any other of its
rights or releasing the other party from any of its obligations under this
Lease.  Nothing herein shall permit
Tenant to set off from monies due Landlord contrary to the provisions of Section 3.6.

 

21

 

10.6                           Enforcement
Expenses.  A non-complying party
shall promptly reimburse the other party for all costs and expenses, including
without limitation reasonable legal fees, incurred by such other party in
exercising and enforcing its rights under this Lease following the failure of
such non-complying party to comply with its obligations hereunder, whether or
not such failure constitutes an Event of Default on the part of the
non-complying party.

 

10.7                           Late
Charges and Interest on Overdue Payments. 
In the event that any payment of Annual Fixed Rent of Additional Rent
shall remain unpaid for a period of eight (8) days following notice by the
Landlord to the Tenant that such payment is overdue, there shall become due to
the Landlord from the Tenant, as Additional Rent and as compensation for the Landlord’s
extra administrative costs in investigating the circumstances of late rent, a
late charge of one and one-half percent (1 1/2%) of the amount overdue.  In addition, any Annual Fixed Rent and
Additional Rent not paid within such eight (8) day grace period shall bear
interest from the date due to the Landlord until paid at the variable rate (the
“Default Interest Rate”) equal to the rate at which interest accrues on amounts
not paid when due under the terms of the Landlord’s financing for the Property.

 

11.                                 Mortgagees’
Rights.

 

11.1                           Subordination.  This Lease shall at all times be subject and
subordinate to any and all mortgages on the Property, so that the lien of any
such mortgage shall be superior to all right hereby or hereafter vested in the
Tenant, provided, however, that any mortgagee shall agree that the Tenant’s
possession, use and occupancy of the Premises shall not be disturbed in the
event of any foreclosure of any such mortgage unless there then exists an Event
of Default by the Tenant beyond any applicable grace or cure period.

 

11.2                           Prepayment
of Rent not to Bind Mortgagee.  No
Annual Fixed Rent, or any other charge payable to the Landlord shall be paid
more than thirty (30) days prior to the due date thereof under the terms of
this Lease and payments made in violation of this provision shall (except to
the extent that such payments are actually received by a mortgagee) be a
nullity as against such mortgagee and the Tenant shall be liable for the amount
of such payments to such mortgagee.

 

11.3                           Tenant’s
Duty to Notify Mortgagee; Mortgagee’s Ability to Cure.  No act or failure to act on the part of the
Landlord which would entitle the Tenant under the terms of this Lease, or by
law, to be relived of the Tenant’s obligation to pay Annual Fixed Rent or Additional
Rent hereunder or to terminate this Lease, shall result in a release or
termination of such obligations of the Tenant or a termination of this Lease
unless (i) the Tenant shall have first given written notice of the
Landlord’s act or failure to act to the Landlord’s mortgagees of record, if any
whose identity and address the Tenant shall have been given notice, specifying the
act or failure to act on the part of the Landlord which gives basis to the
Tenant’s rights, and (ii) such mortgagees, after receipt of such notice,
have failed or refused to correct or cure the condition complained of within a
reasonable time thereafter, which shall include a reasonable time not to exceed
thirty (30) days above the cure period set forth in Section 10.3, for such

 

22

 

mortgagee, to obtain
possession of the Property if possession is necessary for the mortgagee to
correct or cure the condition and if the mortgagee notifies the Tenant of its
intention to take possession of the Property and correct or cure such
condition.

 

11.4                           Estoppel
Certificates.  The Tenant shall from
time to time, upon not less than fifteen (15) days prior written request by the
Landlord, execute, acknowledge and deliver to the Landlord a statement in
writing certifying to the Landlord or independent third party, with a true
correct copy of this Lease attached thereto the following facts, if true, and
if untrue, the reasons therefor: (i) that this Lease is unmodified and in
full force and effect (or, if there have been any modifications, that the same
is in full force and effect as modified and stating the modifications); (ii) that
the Tenant has no knowledge of any defenses, offsets or counter claims against
its obligations to pay the Annual Fixed Rent and Additional Rent and to perform
its other covenants under this Lease (or if there are any defenses, offsets, or
counterclaims, setting them forth in reasonable detail); (iii) that there
are no known uncured defaults of the Landlord or the Tenant under this Lease
(or if there are known defaults, setting them forth in reasonable detail); (iv) the
dates to which the Annual Fixed Rent, Additional Rent and other charges have
been paid ; (v) the extent to which the Tenant has exercised the options
set forth in Section 2.3; (vi) that Tenant has accepted, is satisfied
with, and is in full possession of the Premises, including all improvements,
additions, and alterations thereto required to be made by Landlord under the
Lease; (vii) that the Landlord has satisfactorily complied with all of the
requirements and conditions precedent to the commencement of the Term of the
lease as specified in the Lease (or if there is any known non-compliance,
setting it forth in reasonable detail); (viii) the Term, the Commencement
Date and that Tenant has been in occupancy since the Commencement Date and
paying rent since the Commencement Date; (ix) that no monetary or other
considerations have been granted to Tenant by Landlord for entering into this
Lease, except as specified; (x) that Tenant has no notice of a prior
assignment, hypothecation, or pledge of rents or of the Lease; (xi) that the
Lease represents the entire agreement between Landlord and Tenant; (xii) that
no prepayment or reduction of rent and no modification, termination or
acceptance of Lease will be valid as to the patty to whom such certificate is
addressed without the consent of such party; (xiii) that any notice to Tenant
may be given it by certified mail or registered mail, return receipt requested,
or delivered, at the Premises, or at another address specified ;and (xiv) such
other matters with respect to the Tenant’s occupancy and this Lease as the
Landlord’s mortgagee may reasonably request. 
On the Commencement Date, the Tenant shall, at the request of the
Landlord, promptly execute, acknowledge and deliver to the Landlord a statement
in writing that the Commencement Date has occurred, that the Annual Fixed Rent
has begun to accrue and that the Tenant has taken Occupancy of the Premises.  Any statement delivered pursuant to this Section may
be relied upon by any prospective purchaser or mortgagee of the Premises and
shall be binding on that Tenant.

 

12.                                 Right
of First Refusal; Purchase Option.

 

12.1                           Right
of First Refusal.  If during the
Initial Term or any Extension Term of this Lease, Landlord receives a bona fide
arm’s length offer to purchase the Premises which is acceptable to Landlord
(the “Offer”) from any third party (the “Transferee”), Landlord shall

 

23

 

send a notice (herein
referred to as the “Transfer Notice”) to Tenant. The Transfer No be accompanied
by a copy of the Offer including the name and address of the of shall state the
desire of Landlord to sell the Premises on such terms and cor Thereafter,
Tenant shall have the right, which shall be non-assignable except as pr Section 7.8,
to purchase the Premises at the price and upon the terms and conditions in the
Offer.

 

If Tenant desires
to exercise its option, it shall give notice (the “Counter Notice”) to that
effect to Landlord within thirty (30) days after receipt of the Transfer Notice.  Such Counter Notice shall be accompanied by a
cashier’s check in the amount of any deposit or down payment described in the
Offer made payable to the title company set forth in the Offer (the “Title
company”), or the person designated in the Offer, together with a letter
acknowledging Tenant’s agreement to be bound by the terms and conditions of the
Offer.  Such Counter Notice shall set
forth a date not later than sixty (60) days from the service of the Counter
Notice on which the closing shall be held at the office of the Title Company or
at the office of the Niagara County Clerk. 
Tenant’s failure to give a timely Counter Notice (or notice of its
refusal to purchase) shall be deemed a waiver of its right of first refusal to
purchase the Premise and Landlord may sell to the Transferee named in the
Transfer Notice.  Upon the Landlord’s
failure to sell to the Transferee pursuant to the terms of such Offer, this
right of first refusal shall remain in effect as to any future offers, whether
or not received from the same Transferee.

 

12.2                                 Purchase
Option.  Tenant shall have the option
to purchase the Premises free and clear of all liens and encumbrances other
than easements and restrictions of record that do not impair the beneficial use
and occupancy of the Premises by Tenant, exercisable with ninety (90) days’
prior notice, only on the tenth (10th), fifteenth (15th)
and twentieth (20th) anniversary of the Commencement Date at the
following applicable prices:

 

•                  if exercised on the tenth (10th)
anniversary - $4,754,626

•                  if exercised on the fifteenth (15th)
anniversary - $5,622,424

•                  if exercised on the twentieth (20th) anniversary - $6,800,666

 

The closing will
take place within ninety (90) days of the effective date of the notice of
exercise of the purchase option by Tenant. 
Landlord shall at its expense, provide Tenant with a fully guaranteed
tax and title search and survey redated no earlier than six (6) months
from the closing date and shall deliver its bargain and sale deed with covenant
against grantor’s acts with appropriate transfer tax stamps attached, conveying
good and marketable title to Tenant, and if necessary for the Agency to remain
in title, shall execute and deliver an assignment of the Agency Lease and PILOT
Agreement to Tenant in form reasonably acceptable to the Tenant and the Agency.

 

13.                                 Miscellaneous.

 

13.1                           Contingencies &
Terminations.  This Lease is subject
to the Contingencies set forth on Exhibit E.

 

24

 

13.2                           Intentionally
omitted.

 

13.3                           Notice
of Lease.  The Tenant agrees not to
record this Lease, but upon request of either party, both parties shall execute
and deliver a memorandum of this Lease in form appropriate for recording or
registration, an Instrument acknowledging the Commencement Date of the Term,
and if this Lease is terminated before the Term expires, an instrument in such
form acknowledging the date of termination.

 

13.4                           Notices.  Whenever any notice, approval, consent,
request, election, offer or acceptance is given or made pursuant to this Lease,
it shall be in writing.  Communications
and payments shall be addressed, if to the Landlord, at the Landlord’s Address
for Notices as set forth in Exhibit A or at such other address as may have
been specified by prior notice to the Tenant; and if to the Tenant, at the
Tenant’s Original Address or at such other place as may have been specified by
prior notice to the Landlord.  Any
communication so addressed shall be deemed duly given on the earliest of (i) the
date received (ii) on the third business day following the day of mailing if
mailed by registered or certified mail, return receipt requested or (iii) on
the second calendar day after confirmed transmission by telecopier.  If the Landlord by notice to the Tenant at
any time designates some other person to receive payments or notices, all
payments or notices thereafter by the Tenant shall be paid or given to the
agent designated until notice to the contrary is received by the Tenant from
the Landlord.

 

Landlord agrees to
give to Tenant, copies of all notices relating to Landlord’s non-performance
given to Landlord by the Agency under the Agency Lease or PILOT Agreement and
by any mortgagee with respect to the Premises, promptly upon receipt by the
Landlord.

 

13.5                           Successors
and Limitation on Liability of the Landlord.  The benefits and obligations of this Lease
shall run with the land, and this Lease shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns,
except that the original Landlord named herein and each successor Landlord
shall be liable only for obligations accruing during the period of its
ownership.

 

The obligations of
the Landlord shall be binding upon the assets of the Landlord consisting of an
equity ownership of the Property and rental received therefrom, but not upon
other assets of the Landlord and neither the Tenant, nor anyone claiming by,
under or through the Tenant, shall be entitled to obtain any judgment creating
personal liability on the part of the Landlord or enforcing any obligations of
the Landlord against any assets of the Landlord other than an equity ownership
of the Property and the rentals received therefrom.  Nothing herein shall permit Tenant to set off
from monies due to Landlord contrary to the provisions of Section 3.6.

 

13.6                           Waivers
by the Landlord or Tenant.  The
failure of the Landlord or the Tenant to seek redress for violation of, or to
insist upon strict performance of, any covenant

 

25

 

or condition of this
Lease, shall not be deemed a waiver of such violation nor prevent a subsequent
act, which would have originally constituted a violation, from having all the
force and effect of an original violation. 
The receipt by the Landlord of Annual Fixed Rent or Additional Rent with
knowledge of the breach of any covenant of this Lease shall not be deemed a
waiver of such breach.  No provision of
this Lease shall be deemed to have been waived by the Landlord, unless such
waiver be in writing signed by the Landlord. 
No consent or waiver, express or implied, by a party to or of any breach
of any agreement or duty by the other party shall be construed as a waiver or
consent to or of any other breach of the same or any other agreement or duty.

 

13.7                           Acceptance
of Partial Payments of Rent.  No acceptance
by the Landlord of a lesser sum than the Annual Fixed Rent and Additional Rent
then due shall be deemed to be other than a partial installment of such rent
due, nor shall any endorsement or statement on any check or any letter
accompanying any check or payment as rent be deemed an accord and satisfaction,
and the Landlord may accept such check or payment without prejudice to the
Landlord’s right to recover the balance of such installment or pursue any other
remedy in this Lease provided.  The
delivery of keys to any employee of the Landlord or to the Landlord’s agent or
any employee thereof shall not operate as a termination of this Lease or a
surrender of the Premises.

 

13.8                           Interpretation
and Partial Invalidity.  If any term
of this Lease, or the application thereof to any person or circumstances, shall
to any extent be invalid or unenforceable, the remainder of this Lease, or the
application of such term to persons or circumstances other than those as to
which it is invalid or unenforceable, shall not be affected thereby, and each
term of this Lease shall be valid and enforceable to the fullest extent permitted
by law.  The titles of the Sections are
for convenience only and not to be considered in construing this Lease.  This Lease contains all of the agreements of
the parties with respect to the subject matter thereof and supersedes all prior
dealings between them with respect to such subject matter.

 

13.9                           Quiet
Enjoyment.  So long as the Tenant
pays Annual Fixed Rent and Additional Rent, performs all other the Tenant
covenants of this Lease and observes all conditions hereof, the Tenant shall
peaceably and quietly have, hold and enjoy the Premises free of any claims by,
through or under the Landlord.

 

13.10                     Brokerage.  The Tenant and Landlord represent and warrant
to each other that it has had no dealings with any broker or agent and agree to
hold each other harmless from any such claim.

 

13.11                     Surrender
of Premises and Holding Over.  The
Tenant shall surrender possession of the Premises on the last day of the Term
and the Tenant waives the right to any notice of termination or notice to quit.  The Tenant covenants that upon the expiration
or sooner termination of this Lease, it shall, without notice, deliver up and
surrender possession of the Premises in the same condition in which the Tenant
has agreed to keep the same during the continuance of this Lease and in
accordance with the terms hereof, normal wear and tear

 

26

 

excepted, first removing
therefrom all goods, effects and fixtures of Tenant and repairing all damage
caused by such removal.  Upon the
expiration of this Lease or if the Premises should be abandoned by the Tenant,
or this Lease should terminate for any cause, and at the time of such
expiration, vacation, abandonment or termination, the Tenant or Tenant’s
agents, subtenants or any other person should leave any property of any kind or
character on or in the Premises in the event of termination of the Lease before
expiration of the Term as a result of a court or administrative ruling in any
proceeding contested by the Tenant, for more than sixty (60) days without
paying rent at the rate of the Annual Fixed Rent therefor, the fact of such leaving
of property on or in the Premises shall be conclusive evidence of intent by the
Tenant, Tenant’s agents or subtenants, to abandon such property so left in or
upon the Premises, and such leaving shall constitute abandonment of the
property.

 

It is understood
and agreed by and between the parties hereto that none of Landlord’s servants,
agents or employees, have or shall have the actual or apparent authority to
waive any portion of this paragraph, and except as otherwise provided in this Section 13.11,
the Tenant shall have no right to leave any such property upon the Premises
without the written consent of Landlord.

 

Landlord, its agents or
attorneys, shall have the right and authority without notice to Tenant, Tenant’s
agent or subtenants, or anyone else, to remove and destroy, or to sell or
authorize disposal of such property abandoned or deemed abandoned hereunder, or
any part thereof, without being in any way liable to the Tenant therefor.  The said property received therefor shall
belong to the Landlord as compensation for the removal and disposition of said
property.

 

Except as
otherwise provided in this Section 13.11, if the Tenant fails to surrender
possession of the Premises upon the expiration or sooner termination of this
Lease, the Tenant shall pay to Landlord, as rent for any period after the
expiration or sooner termination of this Lease an amount equal to twice the
Annual Fixed Rent and the Additional Rent required to be paid under this Lease
as applied to any period in which the Tenant shall remain in possession.  Acceptance by the Landlord of such payments
shall not constitute a consent to a holdover hereunder or result in a renewal
or extension of the Tenant’s rights or occupancy.  Such payments shall be in addition to and
shall not affect or limit the Landlord’s right of re-entry, Landlord’s right to
collect such damages as may be available at law, or any other rights of the
Landlord under this Lease or as provided by law.

 

13.12                     Intentionally
omitted.

 

13.13                     Financial
Reporting.  If requested by Landlord,
Tenant shall provide Landlord with financial statements of Tenant together with
related statements of Tenant’s operations for Tenant’s most recent fiscal year
then ended, certified to Landlord by an independent certified public accounting
firm (if available) on the anniversary of the Lease.  If certified financial statements are
unavailable, Tenant shall compile and deliver to Landlord substantially similar
statements, attested to by Tenant or other authorized financial officer.  Landlord agrees to maintain such statements
in the strictest of confidence and Landlord may

 

27

 

provide such statements
only to its mortgagee for the purposes of financing or refinancing any mortgage
on the Premises and to the Agency as is required under the Agency Lease.

 

13.14                     Building
and Premises Area.  Prior to the
Commencement Date, Landlord shall deliver to Tenant a statement setting forth
the rentable square feet area of the Building as computed by the Landlord’s
architect.  The amounts of such area
shall be deemed incorporated in this Lease. 
The Annual Fixed Rent shall be computed as provided in Exhibit A.

 

13.15                     Counterpart
Signatures.  This Lease may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same Instrument.

 

	
   

  	
  LANDLORD:

  
	
   

  	
  CALAMAR ENTERPRISES,
  INC.

  
	
   

  	
  on behalf of Limited
  Liability Company to be

  
	
   

  	
  formed

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth M. Franasiak

  	
   

  
	
   

  	
   

  	
  Kenneth M. Franasiak,
  President

  	
   

  
	
   

  	
   

  
	
   

  	
  TENANT:

  SILIPOS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joel E. Bickell

  	
   

  
	
   

  	
   

  	
  Joel E. Bickell,
  Chairman/CEO

  	
   

  

 

28

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