FINAL CHELSEA PIERS LEASE – HRPT BOARD APPROVED MAY 19, 2022
9796273.22
LEASE AGREEMENT
between
HUDSON RIVER PARK TRUST
LESSOR
and
CHELSEA PIERS L.P.
And
NORTH RIVER OPERATING COMPANY L.P.
LESSEE
Premises
Piers 59, 60, 61 and Headhouse, Borough of Manhattan
May 19, 2022
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TABLE OF CONTENTS
PAGE
DEFINITIONS ............................................................................................... 4
ORIGINAL LEASE, DEMISE OF PREMISES AND TERM .................... 30
RENT ........................................................................................................... 34
IMPOSITIONS ............................................................................................ 61
INSURANCE ............................................................................................... 69
CASUALTY ................................................................................................ 71
CONDEMNATION ..................................................................................... 82
ASSIGNMENT, SUBLETTING, MORTGAGES, ETC. ............................ 89
PUBLIC ACCESS IMPROVEMENT PLAN; PUBLIC OUTREACH .... 111
REPAIRS ................................................................................................. 134
CHANGES, ALTERATIONS AND ADDITIONS ................................. 146
REQUIREMENTS ................................................................................... 160
EQUIPMENT........................................................................................... 161
DISCHARGE OF LIENS; BONDS ......................................................... 162
REPRESENTATIONS; POSSESSION ................................................... 164
LESSOR AND/OR THE CITY AND/OR THE STATE NOT LIABLE FOR
INJURY OR DAMAGE ................................................................................................. 170
INDEMNIFICATION OF LESSOR, THE STATE AND OTHERS ...... 172
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RIGHT OF ENTRY, ETC. ...................................................................... 176
RIGHT TO PERFORM COVENANTS OF OTHER PARTY ................ 178
NO ABATEMENT OF RENTAL ........................................................... 181
PERMITTED USE; NO UNLAWFUL OCCUPANCY .......................... 181
EVENTS OF DEFAULT, CONDITIONAL LIMITATIONS, REMEDIES,
ETC. ................................................................................................................................ 198
NOTICES ................................................................................................. 213
PUBLIC ACCESS AREAS / SECURITY / TRAFFIC AND PEDESTRIAN
MANAGEMENT PLAN ................................................................................................ 216
UTILITIES ............................................................................................... 222
SUBORDINATION ................................................................................. 222
CERTIFICATES BY LESSOR AND LESSEE ...................................... 223
CONSENTS AND APPROVALS ........................................................... 224
SURRENDER AT END OF TERM ........................................................ 226
ENTIRE AGREEMENT .................................................................................... 228
QUIET ENJOYMENT ............................................................................. 228
DISPUTE RESOLUTION ....................................................................... 229
INVALIDITY OF CERTAIN PROVISIONS ......................................... 239
SUBLEASE ............................................................................................. 239
RECORDING OF MEMORANDUM ..................................................... 240
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NON-DISCRIMINATION AND AFFIRMATIVE ACTION ................. 240
SECURITY DEPOSIT; BOND ............................................................... 241
REPORTS, BOOKS AND RECORDS, INSPECTION AND AUDIT ... 244
MISCELLANEOUS ................................................................................ 248
HAZARDOUS MATERIALS ................................................................. 260
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EXHIBITS AND APPENDICES
Appendix A-1 –Baseline Public Access Improvement Plan
Appendix A-2 - Enhanced Public Access Improvement Plan
Appendix B - Illustrative Example of Percentage Rent Calculation
Exhibit A -1– Land
Schedule 1 to Exhibit A-1 – 2020 Survey (of Premises including Land and Improvements)
Exhibit A-2 – Right of Way
Exhibit A-3 - Route 9A Access Parcel 1 and Access Parcel 2
Exhibit A-4 – Water and Marina Area
Exhibit B –Title Matters
Exhibit C – Intentionally Omitted
Exhibit D – Existing Tenants
Exhibit E – Intentionally omitted
Exhibit F–Insurance
Exhibit G – Public Access Area
Exhibit H – Traffic and Pedestrian Management Plan
Exhibit I – Form of New York State Subordination and Non-Disturbance Agreement
Exhibit J-1 – Existing Signage
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Exhibit J-2 – Signage Plan
Exhibit J-2A – Preliminary Signage
Exhibit K – Usable Square Footage Summary
Exhibit L – Depiction of Headhouse
Exhibit M – Chelsea Piers May 10, 2022 Letter to Community Board 4
Exhibit N – Section 9.3 Additional Commitments
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THIS AGREEMENT is made as of _____________, 2022 and is effective as of the
Commencement Date between, on the one hand, the HUDSON RIVER PARK TRUST (“HRPT”
or “Lessor”), acting by and through its authority under chapter 592 of the laws of the State of New
York of 1998, as amended by chapter 517 of the laws of 2013 and as further amended, having an
office at Pier 40, 353 West Street, 2
nd
floor, New York, New York 10014, and, on the other hand,
CHELSEA PIERS L.P. (“CPLP”) and NORTH RIVER OPERATING COMPANY L.P. (“NROC”
and, together with CPLP, collectively, “Lessee”), each a New York limited partnership having an
office at Pier 62, Suite 300, New York, New York 10011.
W I T N E S S E T H:
WHEREAS, the State of New York, acting by and through the Commissioner of the
Department of Transportation (“DOT”), and CPLP executed and delivered that certain lease dated
as of June 24, 1994, a memorandum of which was recorded June 29, 1994 in Reel 2110 Page 1713,
as amended by that certain amendment to lease dated as of June 30, 1996, a memorandum of which
was recorded December 19, 1996 in Reel 2404 Page 1574, and by that certain second amendment
to lease dated as of December 11, 2013 and by that certain third amendment to lease dated as of
September 9, 2015, and by that certain fourth amendment to lease dated as of August 31, 2020,
and as supplemented and amended by a side agreement bearing even date herewith (as so amended,
the “Original Lease”), with respect to the lease of the premises known as Piers 59, 60, and 61 and
the Headhouse, located in the Borough of Manhattan, County of New York, City and State of New
York, as more particularly described herein;
WHEREAS, DOT and an affiliate of CPLP executed that certain Permit for Use of State-
Owned Property, Permit Account No. XW418, on October 21, 1996 for land under water south of
Pier 59 for use as a marina by Lessee (the “Marina Permit”);
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WHEREAS, HRPT succeeded to the State of New York’s and DOT’s interests as Lessor
to the Original Lease and as Permittor to the Marina Permit pursuant to the Hudson River Park
Act, 1998 Session Laws of New York, Chapter 592, as amended;
WHEREAS, in light of the circumstances surrounding the COVID-19 pandemic, HRPT
and CPLP entered into a rent deferral and repayment agreement, dated as of June 30, 2020, and a
first amendment thereto dated as of August 31, 2020 (such rent deferral and repayment agreement
as so amended, the “RDRA”);
WHEREAS, pursuant to the Hudson River Park Act (such act, as same may be amended
from time to time, the “Act”), HRPT is responsible for the planning, design, development,
construction, operation and maintenance of Hudson River Park and the improvements therein
(collectively, the “Park”), which is located generally between the west side of the Route 9A
bikeway and the U.S. Pierhead line from the northern border of Battery Park City to West 59
th
Street and which also includes Chelsea Waterside Park and 14
th
Street Park on the east side of
Route 9A, all in the Borough of Manhattan, City and State of New York;
WHEREAS, pursuant to Section 7.3(b) of the Act, the State of New York, by and through
its Office of Parks, Recreation and Historic Preservation and its Department of Environmental
Conservation, and HRPT entered into a long term lease agreement, dated as of April 3, 1999 (such
lease agreement, as same may be amended, modified or supplemented from time to time, the “State
Lease”), conveying to HRPT a possessory interest in the New York State-owned property within
the Park and confirming HRPT’s right to properly exercise the powers and responsibilities
provided to HRPT under the Act;
WHEREAS, under the Original Lease CPLP has successfully developed, financed,
maintained and operated a mixed-use facility featuring numerous park/commercial recreation and
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sports uses with substantial public access, and thereby contributed to the growth of the Park and
helped advance the mission of HRPT;
WHEREAS, the parties have mutually agreed to incorporate the premises under the
Original Lease and the premises under the Marina Permit as premises under a single leasehold
interest described in Exhibit A-1 and Exhibit A-4 annexed hereto (the “Premises”);
WHEREAS, the Premises, together with certain adjacent land and in-water areas as more
particularly described in this Lease, is a part of the State-owned property within the Park and is
thereby included in the State Lease to HRPT;
WHEREAS, the piersheds at Piers 60 and 61 have been determined to be eligible for listing
on the National and State Registers of Historic Places;
WHEREAS, HRPT and Lessee have mutually agreed that it was in each of their best
interests to negotiate a new lease for the Premises to be executed and enforced by each as the
parties to the agreement and which agreement would upon its Commencement Date replace the
Original Lease, subsume the RDRA and include up-to-date terms and conditions that are currently
standard requirements for agreements between a New York State public benefit corporation and a
private company, implement certain improvements to public circulation around and through the
Premises, and thereby secure the long term improvement, maintenance, repair, and operation of
the Premises by such private company in a manner that serves the interest of HRPT and the public
as set forth in the Act;
WHEREAS, HRPT and Lessee have undertaken negotiations contemplated by Section
2.2(c) of the Original Lease that would have otherwise occurred at the end of the term of the
Original Lease, and following such negotiations, agree to enter into this new lease for the Premises
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effective as of the Commencement Date as defined herein and terminate the Original Lease on and
subject to the occurrence of the Commencement Date;
WHEREAS, the draft of this Lease was subject to public review as a Significant Action
pursuant to the Act during the period from February 11, 2022 to April 26, 2022; and
WHEREAS, it is hereby mutually agreed by and between the parties hereto that this Lease
is made upon the terms, covenants and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the premises, and other good and valuable
consideration, the mutual receipt and sufficiency of which the parties hereby acknowledge, the
parties hereto, for themselves, their legal representatives, successors and assigns, hereby covenant
as follows:
DEFINITIONS
The terms defined in this Article 1 shall, for all purposes of this Lease, have the following
meanings.
“Act” means the Hudson River Park Act, 1998 Session Laws of New York, Chapter 592,
as amended.
“Additional Credit Base Amounts” shall have the meaning provided in Section 9.1(e).
“Affiliate” shall mean (i)(a) any Person that has, directly or indirectly, an ownership
interest in Lessee or (b) any Person in which Lessee, or an Affiliate of Lessee by virtue of clause
(a) of this definition, has a twenty-five percent (25%) or greater ownership interest, or (ii) any
individual who is a member of the immediate family (whether by birth or marriage) of an
individual Affiliate (immediate family for purposes of this definition means a spouse of an
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individual Affiliate; a brother or sister of the whole or half-blood of an individual Affiliate or his
or her spouse; and a lineal descendent or ancestor (including an individual related by or through
legal adoption of any of the foregoing) or a trust for the benefit of any of the foregoing; provided,
however, that for purposes of this Lease no limited partner of Lessee shall be deemed to be an
Affiliate of Lessee solely by virtue of being a limited partner of Lessee and none of the following
entities shall be deemed to be an Affiliate of Lessee so long as with respect to any such entity no
change in the way in which such entity is structured, owned and governed occurs after the
Commencement Date such that the financial results of such entity are consolidated with the results
of CPLP and/or NROC under GAAP: Chelsea Piers Connecticut LLC or any entity of which
Chelsea Piers Connecticut LLC is the sole member or sole owner; CPFC OpCo LLC or any entity
of which CPFC OpCo LLC is the sole member or sole owner; CP Field House LLC or any entity
of which CP Field House LLC is the sole member or sole owner; and Pier Sixty LLC or any entity
of which Pier Sixty LLC is the sole member or sole owner.
“Agreement” shall mean this document and any amendments and supplements thereof.
“Annual CPA Statement” shall have the meaning provided in Section 3.3(h).
“Applicable Rate” shall mean an annual rate equal to the lesser of the maximum rate
allowed by law and five percent (5%) above the annual rate of interest announced from time to
time by the New York branch of JP Morgan Chase Bank N.A. or its successor as its base or “prime”
rate of interest.
“Approved Engineer” shall mean an independent, qualified, reputable and experienced
New York State licensed marine professional engineer that (i) meets (A) the qualifications for
same as set forth in the Citywide Waterfront Inspection Guidelines Manual prepared by ch2m for
New York City Economic Development Corporation (“NYCEDC”), released on October 14, 2016
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by NYCEDC and the Mayor’s Office of Recovery and Resiliency (the “NYCEDC Guidelines
Manual”), a copy of which has been provided to Lessee and of which Lessee hereby acknowledges
receipt, or (B) should the NYCEDC Guidelines Manual be superseded by another manual issued
by NYCEDC or other agency of the City of New York with similar scope and purpose, the
qualifications set forth therein, or (C) should the Lessor determine in its reasonable judgment that
the NYCEDC Guidelines Manual is no longer applicable and no successor manual is available,
then such other standards of qualification for marine engineers as may be proposed by Lessee and
approved by Lessor (such approval not to be unreasonably withheld, conditioned or delayed), (ii)
is independent of contractor entities performing marine repair work in New York Harbor, and (iii)
is approved by Lessor, such approval not to be unreasonably withheld, conditioned or delayed. As
of the date hereof, the team of Vachris Engineering and Rising Tide Waterfront Solutions PLLC
(with either acting as subconsultant to the other) is approved by Lessor as an Approved Engineer.
“Approved Repair Details” means plans and specifications for Pier Repair Work for the
types of pier repairs described in the portion of the Chelsea Piers Repair Plan identified therein as
“Repair Details”, as such details may be changed in accordance with the Chelsea Piers Repair Plan
and/or Section 10.9.
“Baseline Public Access Improvements” shall have the meaning provided in Section
9.1(a).
“Biennial Percentage Increase” shall have the meaning provided in Section 3.1(a)(ii)(B).
“Budgeted Enhanced Public Access Improvement Costs” shall have the meaning
provided in Section 9.1(f).
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“Business Days” shall mean any day that is not a Saturday, a Sunday, a day observed as a
legal holiday in the City, a day in which the City is closed for business, or a day on which banking
institutions in the City are authorized by law or executive order to close.
“Business Interruption Insurance” shall have the meaning provided in Exhibit F.
“Capital Improvement” shall have the meaning provided in Section 11.1.
“Casualty” shall have the meaning provided in Section 6.1.
“Catering Facilities” shall have the meaning provided in Section 21.1.
“Certificate of Occupancy” shall mean any temporary or permanent certificate of
completion or occupancy for all or part of the Improvements issued by the New York City
Department of Buildings or New York City Department of Small Business Services, or any other
temporary or permanent certificate of completion or certificate of occupancy for all or part of the
Improvements issued by a Governmental Authority.
“Change of Control” of a Person means that as a result of a Transfer, Control of such
Person is held by a Person or Persons who or that did not have Control of such Person immediately
prior to such Transfer; provided, however, that trading of publicly-traded equity interests in a
Person shall in no event be deemed to give rise to a Change of Control unless such trading occurs
as a result of a merger, consolidation or tender offer that in and of itself results in a Change of
Control.
“Change Order” shall have the meaning provided in Section 9.1(f).
“Chelsea Piers Repair Plan” shall mean the preliminary report entitled “Chelsea Piers
Repair Plan – October 30, 2013,” together with (i) the one-page document entitled “Chelsea
Piers Pile Repair Plan – Legend for Drawings 10/31/13” and (ii) the 21-page Addendum entitled
“Chelsea Piers Pile Repair Program – Summary of Assessment and Repairs, Rev. Date
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12/9/2013”, and the twelve-page document entitled “Pier 59, 60, and 61 Hudson River 2021
Substructure Repair Plan” dated February 2021.
“City” means the City of New York, New York.
“CPLP” means Chelsea Piers L.P., one of the Persons comprising the Lessee.
“Commencement Date” shall have the meaning provided in Section 39.29.
“Construction Agreements” shall mean agreements for construction, Restoration, Capital
Improvements, rehabilitation, alteration, repair or demolition performed pursuant to this Lease.
“Construction Documents” shall have the meaning provided in Section 11.1.
“Consumer Price Index” or “CPI” shall mean the Consumer Price Index for All Urban
Consumers published by the Bureau of Labor Statistics of the United States Department of Labor,
New York - Northern New Jersey - Long Island, NY - NJ - CT, All Items (1982-84 - 100), or any
successor or substitute index thereto. As of the Execution Date, the CPI is identified by the Bureau
of Labor Statistics of the United States Department of Labor as Series ID: CUURS12ASA0.
“Control” of a Person other than a natural Person means ownership of not less than 50%
of each class of the authorized and outstanding stock of a corporation and ownership of the legal
and equitable interest in a partnership or other entity entitled to at least 50% of the distributions
and profits of such partnership or other entity, or, when used with respect to any specified Person,
the power to direct the management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities or other beneficial interest, by contract or otherwise
(and the terms “Controlling” and “Controlled by” have the corresponding meanings). A Person
that otherwise is deemed to “Control” another Person pursuant to this definition shall still be
deemed to “Control” such other Person notwithstanding that a third party may have the right to
participate in “major decisions”.
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“CPI Adjuster” means, with respect to any figure as of any date, an adjustment factor that
reflects the aggregate increase in the CPI from the month preceding the Commencement Date, or
such other date as set forth herein, to the month preceding the date of the adjustment as set forth
herein, provided that the CPI Adjuster shall not be less than zero.
“Cure Termination Notice” shall have the meaning provided in Section 8.6(d).
“Default” shall mean any condition or event that constitutes an Event of Default without
notice or lapse of time, or an event or condition that after notice or lapse of time, or both, would
constitute an Event of Default.
“Deficiency” shall have the meaning provided in Section 22.2(c).
“Depository” shall mean an entity that would qualify as an Institutional Lender, designated
by Lessee and approved by Lessor, which approval shall not be unreasonably withheld, to serve
as Depository pursuant to this Lease, provided all funds held by such Depository pursuant to this
Lease shall be held in New York City. If Lessee fails to designate a Depository within ten (10)
days after being given notice of a request of Lessor to designate a Depository, Lessor shall have
the right to designate such Depository.
“Determined Understatement” shall have the meaning provided in Section 38.3.
“DOT” shall mean the New York State Department of Transportation.
“Due Date” shall mean, with respect to an Imposition, the last date on which such
Imposition can be paid without any fine, penalty, interest or cost being added thereto or imposed
by law for the non-payment thereof.
“Enhanced Public Access Improvement Cost” shall have the meaning provided in
Section 9.1(e).
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“Enhanced Public Access Improvements” shall have the meaning provided in Section
9.1(a).
“Environmental Statutes” shall mean all federal, state and local laws, rules and
regulations, whether now existing or hereafter enacted or promulgated, regulating, relating to or
imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste,
substance or material or the protection of the environment, including, without limitation: (1)
Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C.
§§9601 et seq., (known as CERCLA or Superfund) as amended by the Superfund Amendments
and Reauthorization Act of 1986 (known as SARA); (2) Solid Waste Disposal Act, 42 U.S.C.
§§6901 et seq., (known as SWDA) as amended by Resource Conservation and Recovery Act
(known as RCRA); (3) National Environmental Policy Act, 42 U.S.C. §4321 et seq., (known as
NEPA); (4) Toxic Substance Control Act, 15 U.S.C. §§2601 et seq., (known as TSCA); (5) Safe
Drinking Water Act, 42 U.S.C. §§300(f) et seq., (known as Public Health Service Act, PHSA); (6)
Refuse Act, 33 U.S.C. §1407 et seq; (7) Clean Water Act, 33 U.S.C. §§1251 et seq., (known as
Federal Water Pollution Control Act, FWPCA); (8) Clean Air Act, 42 U.S.C. §§7401 et seq.,
(known as CAA); (9) The Emergency Planning and Community Right-to-Know Act of 1986, 42
U.S.C. §§11001 et seq., (known as EPCRTKA); (10) The Occupational Safety and Health Act, 29
U.S.C. §§1651 et seq., (known as OSHA); (11) the New York Environmental Conservation Law,
§1-0101 et seq., (known as ECL); and (12) the New York Navigation Law Article 12.
“Equipment” shall mean all fixtures now or hereafter incorporated in or attached to and
used or usable in the operation of the Premises, including, but not limited to, all machinery,
apparatus, devices, motors, engines, dynamos, compressors, pumps, boilers and burners, heating,
lighting, plumbing, ventilating, air cooling and air conditioning equipment, chutes, ducts, pipes,
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tanks, fittings, conduits and wiring, incinerating equipment, hoists, communication equipment, and
all additions or replacements thereof. “Equipment” shall not mean any fixture or utilities owned
by any utility company for the providing of utilities to the general public, any item of personal
property owned or leased by Lessee or any Occupant, any Trade Fixtures, or any equipment
temporarily used by contractors engaged in maintaining the Premises or constructing
Improvements.
“Event of Default” shall have the meaning provided in Section 22.1.
“Excess Development Rights” shall mean unused available square feet of Zoning Floor
Area permitted on the zoning lots or portions of zoning lots comprising the Premises pursuant to
the New York City Zoning Resolution. Excess Development Rights has the same meaning as the
commonly used terms unused development rights, transferable development rights or air rights.
“Execution Date” shall mean the date on which the last signature of the parties hereto to
this Lease is affixed on the signature page hereof.
“Expiration Date” shall have the meaning provided in Section 2.4.
“Existing Improvements” shall mean the Improvements existing at the Commencement
Date upon the Land and the footings, foundations and other supports therefor beneath the Land.
“Existing Tenant” shall mean any tenant or occupant of the Premises at the
Commencement Date other than Lessee. Exhibit D lists the Occupants that would constitute the
Existing Tenants if the Commencement Date had occurred as of the date set forth on Exhibit D.
“Fixed Base Rent” shall have the meaning provided in Section 3.1(a).
“GAAP” shall mean U.S. generally accepted accounting principles as in effect at the time
of any reference thereto, consistently applied.
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“Governmental Approval” shall mean all approvals, permits and consents of any
Governmental Authority required by law for the operation of the Improvements and the
construction of any Lessee Improvement that is undertaken after the Commencement Date,
including, without limitation, any New York City zoning special permit requirements to construct
on the Land.
“Governmental Authority (Authorities)” shall mean the United State of America, the
State of New York, the City of New York, the Borough of Manhattan, the County of New York
and any agency, department, commission, board, bureau, instrumentality or political subdivision
of any of the foregoing, now existing or hereafter created, having jurisdiction over the Premises or
any portion thereof.
“Gross Proceeds” shall have the meaning provided in Section 3.4(b)(ii).
“Gross Revenues” shall have the meaning provided in Section 3.3.
“Hazardous Materials” shall mean (i) any “hazardous waste” as defined under the
Resource Conservation and Recovery Act, 42 U.S.C. Section 9601 et seq., or (ii) “hazardous
substance” as defined under the Comprehensive Environmental Response, Compensation, and
Liability Act, 42 U.S.C. Section 6901 et seq., or (iii) “hazardous materials” as defined under the
Hazardous Materials Transportation Act, 49 U.S.C. Section 5101 et seq., or (iv) “hazardous waste”
as defined under N.Y. Envtl. Conserv. Law § 27-0901 et seq., or (v) “hazardous substance” as
defined under the Clean Water Act, 33 U.S.C.A. § 1321, or (vi) “petroleum” within the meaning
of Article 12 of the New York State Navigation Law.
“Headhouse” shall mean the portion of the building depicted on Exhibit L and generally
located east of the Piers 59, 60, and 61 piersheds and Pier 62 and adjacent to and immediately to
the west of the Service Road sidewalk that forms a part of the Existing Improvements.
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“Impositions” shall have the meaning provided in Section 4.1.
“Improvement Approvals” shall have the meaning provided in Section 11.1(h).
“Improvements” shall mean the buildings, platforms, marinas, piers, bulkheads, wharfs,
berths, slips, parks, stables, golf driving ranges, Equipment and other improvements and
appurtenances of every kind and description existing at the Commencement Date or hereafter
erected, constructed, rehabilitated or placed upon the Land (including, without limitation, Existing
Improvements, Lessee Improvements, Capital Improvements and improvements constructed in the
course of Non-Approvable Construction Projects) and the footings, foundations and other supports
therefor beneath the Land, and all alterations and replacements thereof, additions, thereto and
substitutions therefor.
“Indemnitees” shall have the meaning provided in Section 17.1.
“Inspection Documents” shall have the meaning provided in Section 38.4.
“Institutional Lender” means (a) a savings bank, (b) a savings and loan association, (c) a
commercial bank or trust company (whether acting individually or in a fiduciary capacity), (d) an
insurance company organized and existing under the laws of the United States or any state thereof,
(e) a religious, educational or eleemosynary institution, (f) a federal, state or municipal employee’s
welfare, benefit pension or retirement fund, (g) any governmental agency or entity insured by a
governmental agency, (h) any publicly traded entity, including a publicly-traded real estate
investment trust, or any other reputable entity that, in each case, is regularly engaged in providing
financing for real estate projects, and that has a market capitalization of $10 billion or more as of
the date such entity becomes a Mortgagee, (i) any Person that is entirely owned and controlled by
one of the entities listed in clauses (a) through (h) above, or (j) any other entity which Lessor has
approved in writing (which approval shall not be withheld or unreasonably delayed if Lessor is
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reasonably satisfied that the qualifications and experience of such entity indicate that it will meet
all the obligations of Lessee hereunder if it becomes necessary for such entity to take over the
tenancy interest herein and will otherwise satisfy the conditions set forth herein), provided
however, that each of the above entities listed in clauses (a) through (i) shall qualify as an
Institutional Lender only if it (x) is, or shall agree to be subject to the jurisdiction of the courts of
the State of New York in any action arising out of this Lease, (y) has a net worth of not less than
$500,000,000 at the time of making the applicable loan, and (z) is not a Prohibited Person.
“Institutional Lender” shall also include an investment banking or securities brokerage firm, or
any other Person acting as a trustee or fiduciary for bondholders, which meets the conditions set
forth in clauses (x)-(z) of the preceding sentence, provided that Lessor is reasonably satisfied that
the experience, regulatory status and financial standing of said Person and the structure and terms
of any loan transaction in connection with which the “Institutional Lender” designation is sought
shall satisfy the requirements described in the preceding sentence.
“In-Water Permits” shall have the meaning provided in Section 9.1.
“Land” shall mean all that certain property situated, lying and being in the Borough of
Manhattan, County of New York, City and State of New York, as more particularly described in
Exhibit A-l and Exhibit A-4, as the same may be amended, annexed to and made a part of this
Lease. To the extent any boundary of the Land as reflected in Exhibit A-1 is contiguous with the
boundary of Route 9A, the boundary of the Land is subject to modification to conform to the
boundary of Route 9A, as such boundary is finally determined by DOT in the comprehensive
drawings filed by record of DOT upon completion of the reconstruction of Route 9A in accordance
with Section 2.3(b) (and upon such filing of record by DOT such boundary of Lessor shall ipso
facto be deemed to have been so modified, provided that DOT confirms that such modifications
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will not materially impede or restrict the vehicular access to the Premises using the Route 9A
Access Parcels, and there shall be no abatement or diminution of Rental or any other consideration
or rental from Lessor or DOT as a result of such modification).
“Lease” shall mean this Agreement and all amendments and supplements thereof.
“Lease Year” shall mean the calendar year or portion thereof beginning on the
Commencement Date and ending on the succeeding December 31, and each succeeding calendar
year during the Term as set forth in Section 3.1(a)(ii). By way of example, should the
Commencement Date be July 1, then the first Lease Year would be the period from July 1 to
December 31 of the same calendar year.
“Lessee” shall mean, collectively, Chelsea Piers L.P. and North River Operating Company
L.P., jointly and severally, each a New York limited partnership, and any assignee or successor of
Lessees’ interest hereunder, permitted under Article 8 hereof.
“Lessee Approvals” shall have the meaning provided in Section 9.1.
“Lessee’s Available Development Rights” shall mean (i) as of the Commencement Date
through such date that is on or before the thirtieth anniversary of the Commencement Date, an
aggregate of 100,000 square feet of Excess Development Rights as such amount may be reduced
from time to time by Lessee’s use of Lessee’s Available Development Rights, and (ii) as of the
thirtieth anniversary of the Commencement Date and through the date that is five years prior to
the Expiration Date, the lesser of (x) 20,000 square feet of Excess Development Rights and (y) the
difference, if positive, between 100,000 square feet of Excess Development Rights and the number
of square feet of Excess Development Rights used by Lessee pursuant to clause (i) of this
definition.
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“Lessee’s Confidential Information” shall mean (i) the Annual CPA Statement delivered
to Lessor, (ii) Lessee’s Redacted Audited Financial Statements that is made available to Lessor for
inspection and/or audit, including any notes taken by Lessor or Lessor’s representative during the
course of such inspection and/or audit, (iii) the Inspection Documents, and (iv) any other
information of Lessee that Lessee owns and controls and identifies as “Confidential” when
delivering copies to or making available for inspection by Lessor, including without limitation
information concerning Lessee’s assets or liabilities, Lessee’s financial results, capitalization,
pricing, business strategies, strategic relationships, financing terms, and names of and information
concerning the Lessee’s investors or lenders; provided, however, that Lessee’s Confidential
Information shall not include (a) the terms or content of this Lease, (b) any information disclosed
by Lessee to Lessor concerning Lessee’s Gross Revenues, (c) any information that would
otherwise constitute Confidential Information received from Lessee that Lessor is required to
disclose in order to enforce the obligations of Lessee under this Lease, or, subject to the provisions
of Section 39.28, that Lessor is required by law, regulation, regulatory authority or other
applicable, judicial or governmental order to disclose or (d) any information that would otherwise
constitute Confidential Information received from Lessee that Lessor demonstrates with competent
written and/or electronic records: (i) was known to Lessor prior to disclosure by Lessee, (ii) is at
the time of disclosure or later becomes generally known or publicly available other than by
unauthorized disclosure by Lessor or its employees, (iii) is lawfully and in good faith obtained by
Lessor from a third party under no obligation of confidentiality with respect to such information,
(iv) was subject to a written consent to disclose by Lessee, or (v) is independently developed by
the Lessor without use of or reference to the Confidential Information disclosed by the Lessee, as
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demonstrated by written and/or electronic records created contemporaneously with such
independent development.
“Lessee Improvements” shall mean those Improvements erected, constructed,
rehabilitated or placed upon the Land or upon the Existing Improvements by or on behalf of the
Lessee during the Term and (in the case of any Capital Improvements or Non-Approvable
Construction Projects, constructed by Lessee after the Commencement Date) approved in writing
by Lessor to the extent required by, or deemed approved by Lessor in accordance with the terms
of Section 11.1.
“Lessee’s Redacted Audited Financial Statements” for any year means a true, correct
and complete copy of the audited financial statements of Lessee (reflecting CPLP and NROC on
a combined basis) for the applicable calendar year in which the auditor’s report, the balance sheet
(other than statements of partners’ or shareholders’ equity and retained earnings), the income
statement and the footnotes appear in their entirety (other than any portions of the footnotes that
contain information that is permitted to be redacted by the terms of this definition) and the
following portions (and only the following portions) thereof have been redacted: (i) the statements
of partners’ or shareholders’ equity and retained earnings or members deficits; (ii) distributions to
general and limited partners of CPLP and NROC; (iii) salaries paid to individuals who are general
and limited partners of CPLP and NROC; (iv) the combined statements of other comprehensive
income if applicable from sources that are not included as Gross Revenue provided that Lessee
shall inform Lessor in adequate detail of the categories of sources (and not the actual amounts of
income from each source) that are not included as Gross Revenue; and (v) any portions of the
footnotes that contain information that is permitted to be redacted by the terms of this definition.
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“Lessee’s Use of the Premises” shall mean the load requirements for the use actually made
by Lessee of each applicable component of the Premises at the time of reference thereto as reflected
in the Loading Plan for Lessee’s Use as it exists at such time.
“Lessor” shall mean the Hudson River Park Trust, or its successors and/or assigns.
“Lessor’s Engineer” means a marine engineer selected by Lessor that meets the
qualifications of an Approved Engineer, which as of the Commencement Date is Moffat & Nichol.
“Lessor’s Mortgage” shall have the meaning provided in Section 8.9.
“Loading Plan for Lessee’s Use” shall mean the load figures for each area of the Premises
other than water areas as reflected in the drawings bearing Drawing Numbers LL101-106 for live
load, DL 101-107 for superimposed dead load, CL 101-106 for column load, and Figs. 66-72 for
first floor dead load, which are included within the report prepared by Halcrow Engineers, P.C.
dated December 11, 2013, entitled “Routine Inspection Observations Piers 59, 60 and 61 at
Chelsea Piers” (the “Halcrow Report”), or as such figures may be updated from time to time
pursuant to Section 10.9(l).
“Major Sublease” shall mean a sublease of 50% or more of the Usable Square Footage of
the Premises.
“Minimum Sports/Recreation Usage Standard” shall mean the use by Lessee and/or
Occupants which, in the aggregate, total not less than the greater of (i) 330,000 square feet of
interior and exterior Usable Square Footage or (ii) [thirty-seven and one-half] percent ([37.5]%)
1
of interior and exterior Usable Square Footage for commercial or non-commercial sports and
recreation services for people of all ages including, but not limited to, golf clubs and driving
1
Subject to confirmation
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ranges, health and fitness clubs, fitness classes, bowling, ice skating, hockey, gymnastics,
children’s day camps, soccer, basketball and other team sports, swimming, or such similar services
(hereafter “Sports and Recreation”), including accessory storage, office and retail so long as it is
(i) located within any such commercial or non-commercial Occupant’s space dedicated to Sports
and Recreation and (ii) serves a dedicated purpose in support of the Sports and Recreation use of
such Occupant’s space. In calculating the percentage in clause (ii) of this definition, (A) Occupant
spaces shall be Usable Square Footage or portions of Usable Square Footage demised under
applicable Occupancy Agreements, and (B) Lessee spaces shall be Usable Square Footage or
portions of dedicated Usable Square Footage used for Lessee’s business purposes as set forth in
Section 21.1(a), (b), (c), (e), (f), (g), (h), (i), and (k) through (p) as each such space is listed in
Exhibit K as of the Execution Date and updated annually by Lessee pursuant to Section 3.3(i) or
more frequently should there be a change within a Lease Year.
“Monthly Credit” shall have the meaning provided in Section 9.1(l).
“Mortgage” or “Mortgages” shall mean any mortgage or mortgages that constitutes a lien
on Lessee’s interest in this Lease and the leasehold estate created hereby, provided such mortgage
meets the requirements of this Lease and is held by (i) an Institutional Lender or Institutional
Lenders, or (ii) a Person formerly constituting Lessee or such Person’s assignee, if such mortgage
is made to such Person in connection with (x) a bona fide assignment to an unrelated party by it of
its interest in this Lease, (y) a bona fide transfer to an unrelated party of partnership interests in a
partnership which is Lessee or (z) a transfer of stock in a corporation which is Lessee.
“Mortgagee” or “Mortgagees” shall mean the holder or holders of a Mortgage or
Mortgages.
“Non-Approvable Construction Project” shall have the meaning provided in Section 11.1.
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“NROC” means North River Operating Company L.P., one of the Persons composing the
Lessee.
“Occupant” or “Occupants” means any sublessee, licensee, permittee, concessionaire,
Affiliate or other Person entitled to occupy and/or use any portion of the Premises by, through or
under Lessee or any such sublessee, licensee, permittee, concessionaire or other Person.
“Occupant” shall not include members of the public who are patrons of Lessee or any sublessee,
licensee, permittee, concessionaire or other Person entitled to occupy and/or use any portion of the
Premises by, through or under Lessee.
“Occupancy Agreement” means any sublease, license, permit, concession or other
agreement permitting an Occupant to occupy and/or use any portion of the Premises by, through
or under Lessee.
“Operating Standard” shall have the meaning provided in Section 21.2.
“Original Lease” shall mean the lease dated as of June 24, 1994 by and between the
Commissioner of DOT, as lessor, and CPLP, as lessee, as amended, as referenced in the Preamble
to this Lease.
“Park” shall have the meaning provided in the Preamble to this Lease.
“Park Rules” shall have the meaning provided in Section 21.5.
“Percentage Rent” shall have the meaning provided in Section 3.3.
“Person” shall mean an individual, corporation, partnership, limited liability company,
joint venture, estate, trust or unincorporated association, or any Federal, State, County or municipal
government or any bureau, department or agency thereof.
“Pier Repair Work” shall mean repair of any marine structure element of the Premises,
including, but not limited to, the pilings, pile caps, and other substructural supports, underdeck,
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underdeck utilities, and other pier and marine elements, both structural and nonstructural, such as
bulkhead walls, the pier decks, fender systems, marinas, dolphins, and pier fascia.
“PILOT” shall have the meaning provided in Section 3.5(a).
“Premises” shall mean the Land and Improvements.
“Production Facilities” shall have the meaning provided in Section 21.1(b).
“Prohibited Person” shall mean:
(a) any Person, or any Person that directly or indirectly Controls, is Controlled by or is
under common Control with a Person, that is in default or in breach, beyond any applicable grace
period, of its obligations under any material written agreement with the City or State (or any
agency or instrumentality thereof), unless (A) such default or breach has been waived in writing
or settled by the City or State (or any agency or instrumentality thereof), as applicable, or (B) such
Person is bona fidely contesting the default or breach, and no final and binding judgment, after the
exhaustion of all appeals, has been rendered holding such Person in default or breach of its
obligations under any material written agreement with the City or State (or any agency or
instrumentality thereof), as applicable, or if an unappealable judgment is rendered, the judgment
has absolved such Person of responsibility for such breach or is fully satisfied;
(b) any Person, or any Person that directly or indirectly Controls, is Controlled by or is
under common Control with a Person, (i) that has been convicted of a misdemeanor related to
truthfulness and/or business conduct in the past five (5) years, (ii) that has been convicted in a
criminal proceeding in the United States for a felony in the past ten (10) years, (iii) who has
received formal notice that they are the target of an investigation by a federal, state or local
governmental agency or body for a felony criminal offense, or with respect to whom Lessor has
been so advised in writing by a governmental agency or Lessor has been so advised orally or in
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writing by the prosecuting agency, unless (x) five (5) years have passed since the initiation of the
investigation and the Person has not been arrested, charged or indicted for a criminal offense
arising out of such investigation, or the Person or Lessor has been advised that such Person is no
longer a target of such investigation, or (y) such Person has been acquitted or discharged of
responsibility for such felony criminal offense, or, (iv) that has been suspended or otherwise
disqualified from entering into contracts with any Governmental Authority unless such suspension
or disqualification has expired by its terms or has been lifted or revoked by the applicable
Governmental Authority, (v) that has received written notice of default in the payment to the City
of more than $10,000 of taxes, sewer rents or water charges that has not been cured or satisfied,
unless such default is then being contested with due diligence in proceedings in a court or other
appropriate forum or as a result of any such contest or any settlement entered into with the City
such Person has been absolved of liability for such default, or (vi) has owned at any time in the
preceding three (3) years any property which, while in ownership of such Person, was acquired by
the City by in rem tax foreclosure, other than a property in which the City has released or is in the
process of releasing its interests to such Person pursuant to the administrative code of the City;
provided, however, in order for such Person to constitute a Prohibited Person, the circumstance(s)
described in clauses (i) and/or (iii) above, must have a material and adverse effect on the business
reputation of Lessee;
(c) any government, or any Person that is directly or indirectly Controlled by a
government, that has been and remains finally determined to be in violation of (including, but not
limited to, any participant in an international boycott in violation of) the Export Administration
Act of 1979, as amended, or its successor statute, or the regulations issued pursuant thereto, or any
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government that is, or any Person that, directly or indirectly, is Controlled (rather than only
regulated) by a government that is, subject to export controls thereunder; or
(d) any government, or any Person that, directly or indirectly, is Controlled (rather than
only regulated) by a government, the effects of or the activities of which are regulated or controlled
pursuant to regulations of the United States Treasury Department or executive orders of the
President of the United States of America issued pursuant to the Trading with the Enemy Act of
1917, as amended.
“Prohibited Use” shall have the meaning provided in Section 21.4.
“Public Access Areas” shall have the meaning provided in Section 24.1.
“Public Access Improvements Construction Contracts” shall have the meaning
provided in Section 9.1(e).
“RDRA” shall have the meaning provided in the Preamble to this Lease.
“Real Property Taxes” for any Lease Year shall mean (i) the real property taxes imposed
upon or assessed against the Premises with respect to such Lease Year under Title 11 of NY
Administrative Code, Chapter 2, §§11-201 et. seq., as same may be subsequently amended or
under any successor statute; (ii) any similar taxes imposed in place of real property taxes if the
method of taxation is changed; (iii) charges that would be imposed upon or assessed against the
Premises with respect to such Lease Year if the Premises or any part thereof or the owner thereof
were not exempt or partially exempt from payment thereof or (iv) charges that are or could be
imposed upon or assessed against the Premises with respect to such Lease Year in lieu of real
estate taxes because the Premises or any part thereof or the owner thereof is exempt or partially
exempt from payment thereof (including, but not limited to, PILOTs).
“Rental” shall have the meaning provided in Section 3.6.
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“Requirements” shall mean the following, as same may be amended, modified or
supplemented from time to time: (i) any and all laws, rules, regulations, orders, ordinances,
statutes, codes, executive orders, resolutions and requirements of all Governmental Authorities
applicable (now or at any time during the Term) to the Lessee or the Premises, or any street, road,
avenue or sidewalk constituting a part of the Premises, or in front of or in the general vicinity of
the Premises to the extent the owner of the Premises would have legal responsibility therefor,
including without limitation the requirements and restrictions contained in or established by the
Hudson River Park Rules and Regulations, as amended (21 N.Y.C.R.R. Part 751), Environmental
Statutes as defined above, the New York City Zoning Resolution, the Building Code of New York
City (Admin. Code Section 27-101 et seq.), the New York City Noise Control Code (N.Y.C.
Admin. Code Sections 24-201, et seq.), as amended, and rules, regulations and other requirements
of the New York City Department of Environmental Protection, the U.S. Army Corps of Engineers
(“Army Corps”), the New York State Department of Environmental Conservation (“NYSDEC”),
the New York State Historic Preservation Office, the New York City Department of Finance, the
New York City Department of Transportation, and the New York State Department of
Transportation, including without limitation, the General Project Plan for the Park, all
Governmental Approvals, and the laws, rules, regulations, orders, ordinances, statutes, codes and
requirements of any applicable Fire Rating Bureau or other body exercising similar functions; (ii)
any and all provisions and requirements of any property, casualty or other insurance policy
required to be carried by Lessee under the provisions of this Lease; (iii) all final actions taken by
the City pursuant to the City Charter with respect to the Premises; (iv) any Certificate of
Completion or Certificate of Occupancy issued for the Improvements as then in force; and (v) the
Act; provided, however, that for purposes of this definition (A) Lessor acknowledges and agrees
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that: (1) Lessee may seek variances and/or exemptions from certain New York City laws and
regulations that Lessee reasonably believes are impractical and uneconomic for the Premises to
comply with, and (2) Lessor will reasonably, and at no cost or expense to Lessor, cooperate with
Lessee’s efforts to obtain variances and/or exemptions from such New York City laws and
regulations in order that the Premises may continue to be operated for the benefit of the
communities served by Lessor and Lessee; and (B) Lessee acknowledges and agrees that (1)
Lessor shall have no liability or responsibility to Lessee as a result of any inability of Lessee to
obtain any such variance or exemption; (2) Lessee will not be excused from complying with any
applicable provision of this Lease unless and until Lessee obtains an applicable variance or
exemption with respect to such provision; and (3) if Lessee should be unable to obtain any such
variance or exemption such inability shall not result in any reduction or abatement of Rental under
this Lease or otherwise affect Lessee’s obligations under the Lease. The parties acknowledge that
nothing in this paragraph precludes the State from determining that certain New York City laws
and regulations do not apply to buildings on State-owned property and to the extent that the State
makes such a determination that is applicable to the Premises, then Lessor agrees that such New
York City law or regulation would not be construed as a Requirement under the Lease.
“Restaurants” shall have the meaning provided in Section 21.1.
“Restoration” shall have the meaning provided in Section 6.1.
“Restoration Funds” shall have the meaning provided in Section 6.2(a).
“Restore” shall have the meaning provided in Section 6.1.
“Reviewing Party” shall have the meaning provided in Section 38.3.
“Right of Way” shall have the meaning provided in Section 2.3.
“Right of Way Area” shall have the meaning provided in Section 2.3.
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“Route 9A Access Parcels” shall have the meaning provided in Section 2.3.
“Sales or Use Taxes” shall mean any taxes, levies or assessments imposed by any taxing
authority upon, measured by the cost of or with respect to the construction of Lessee Improvements
or the acquisition of Trade Fixtures, goods, material and services therefor or in connection
therewith or the acquisition of Equipment during the Term.
“Scheduled Fixed Base Rent” shall have the meaning provided in Section 3.1.
“Security Deposit” shall have the meaning provided in Section 37.1.
“State Lease” shall have the meaning provided in the Preamble to this Lease.
“State” shall mean the State of New York.
“Subleases” shall mean any Occupancy Agreement permitted under Article 8 for the rental
of space at the Premises or the occupancy or use of such space by a Sublessee or Occupant pursuant
to subleases, licenses, permits, concessions or other similar agreements for periods shorter than or
equal to the remainder of the Term at the time of such agreements.
“Sublessees” shall mean the occupants pursuant to Subleases.
“Successor Lessee” shall mean any assignee of or successor to the interest hereunder of
Chelsea Piers L.P. and North River Operating Company L.P. that is permitted under Article 8
hereof.
“Supplemental Fixed Base Rent” shall have the meaning provided in Section 3.1(a)(iv).
“Taking” shall have the meaning provided in Section 7.1.
“Term” shall mean the term of this Lease as set forth in Section 2.4.
“Third Party-Initiated Transaction” shall mean a Transaction that is initiated by a
Person other than the Lessee or an Affiliate of the Lessee.
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“Title Matters” shall mean those matters affecting title to the Land set forth in Exhibit B
hereto and any other present or future encumbrances on Lessor’s interest in the Premises provided
that such other encumbrances are subject and subordinate to this Lease (unless such other
encumbrances are caused or have been caused solely by Lessee) and do not adversely affect
Lessee’s interest in or use of the Premises, and Trade Fixtures, any Lessee Improvements, Lessee’s
rights under this Lease or Lessee’s ability to obtain mortgage or equity financing.
“Trade Fixtures” shall mean moveable items of personal property installed in the
Premises for use in the trade or business of Lessee, Sublessees or any Occupant including, but not
limited to, the ice skating rink, studio lighting systems, track, gymnastics and fitness center
equipment and fixtures, golf driving range equipment and fixtures, and removable marine docks
slips and equipment.
“Traffic and Pedestrian Management Plan” shall have the meaning provided in Section
24.9.
“Transaction Rent” shall have the meaning provided in Section 3.4(a).
“Transfer” shall have the meaning provided in Section 8.1(a).
“2020 Survey” shall mean, collectively, the survey made by Control Point Associates Inc., with
the file number 07-170171 dated September 8, 2017 and last redated as of (i) August6, 2020, with
respect to Lots 11, 16, 19 and 62 and (ii) dated as of August 24, 2020, with respect to Lot 7, a copy
of which 2020 Survey is attached hereto as Schedule 1 of Exhibit A-1.
“Unavoidable Delays” shall mean delays from any and all causes beyond Lessee’s
reasonable control including, without limitation, delays incurred by Lessee due to strikes, lockouts,
acts of God, inability to obtain labor or materials, inability to obtain building permits despite the
best efforts of Lessee, governmental restrictions (other than any governmental restrictions which
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Lessee is bound to observe pursuant to the terms of this Lease), activities by Lessor, enemy action,
civil commotion, fire, the need to remove or dispose of hazardous, toxic or dangerous waste,
substances or material pursuant to the requirements of Environmental Statutes, unavoidable
casualty or other similar causes beyond the reasonable control of Lessee (but not including
Lessee’s insolvency, financial condition or lack of financing), provided that no such Unavoidable
Delay shall be deemed to have commenced unless Lessee notifies Lessor in writing promptly
following the commencement of or the occurrence of the same.
“Usable Square Footage” shall mean the square footage area within the Premises,
including all levels contained therein, that is available to Lessee for its business use or available to
an Occupant under an Occupancy Agreement (or otherwise designated for use by an Occupant,
whether or not pursuant to an Occupancy Agreement) including space available for ancillary public
parking use that is (1) measured (x) if within a building, from the exterior face of exterior perimeter
walls and, as applicable, from the centerline of demising walls between adjacent Occupants (or
between Lessee and an Occupant) without deduction for vertical penetrations within any such
space or mechanical equipment serving such space, and (y) if comprised of exterior spaces from
clearly identified physical elements, and (2) exclusive of common circulation corridors and Public
Access Areas, common stairways and elevators, Lessee’s building service and utility areas, public
toilets and common loading docks, to the extent such areas are not exclusively available to an
Occupant under an Occupancy Agreement (or otherwise designated for exclusive use by an
Occupant). The Premises have a Usable Square Footage of [881,246]
2
square feet as of the
Execution Date as depicted on Exhibit K, which amounts may be modified from time to time in
2
Subject to confirmation
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accordance with the Lease and the Requirements based on floor plans prepared by a licensed
architect using AutoCad or other industry standard methodology to measure square footage.
“Use Modification” shall have the meaning provided in Section 21.2(s).
“Vendex Questionnaire” shall mean the questionnaires used for the vendor responsibility
process generally referred to as the Vendex process of New York City prescribed by the New York
City Mayor’s Office of Contract Services on its Procurement and Sourcing Solutions Portal
(referred to by the City as “PASSPort”) (or any successor thereto) or such other similar vendor
responsibility form prepared by Lessor and completed by each Vendex Required Responder, it
being understood that such questionnaire being provided to Lessor in determining if a Person is a
Prohibited Person does not require such questionnaire to be filed with the State or City of New
York unless such Person is otherwise subject to the State or City Vendex requirements.
“Vendex Required Responders” shall mean Lessee (or the Person that is proposed to
become Lessee) and such Person’s Parent and/or Controlling Entity(ies) as such terms are defined
in the New York City Vendor’s Guide to Vendex or any successor publication thereto. “Vendex
Required Responders” shall not include any Principal Owner of Lessee (or the Person that is
proposed to become Lessee) unless such Principal Owner is a direct Principal Owner of Lessee (or
the Person that is proposed to become Lessee).
“Zoning Regulations” shall mean all applicable present and future laws, rules, orders,
ordinances, regulations, requirements and codes of the City of New York relating to the use and
occupancy of real property.
“Zoning Floor Area” shall mean Floor Area, as defined in the New York City Zoning
Resolution, for the zoning lots or portions of zoning lots that comprise the Premises which, from
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time to time, may be calculated for the Existing Improvements, the Improvements, or the Excess
Development Rights. Notwithstanding the foregoing, the sidewalk and driveway area extending
from the eastern façade of the Headhouse to the Rte. 9 bikeway that forms a portion of the Premises
but is not included in an identified block and lot shall not be considered as a part of the Premises’
zoning lots and shall have no associated Zoning Floor Area. For the avoidance of doubt, the
accessory off-street parking areas located within Pier 59, Pier 60 and Pier 61 that are at-grade or
less than 23 feet above curb line are Existing Improvements without associated Zoning Floor Area
per Section 12-10 of the Zoning Resolution.
ORIGINAL LEASE, DEMISE OF PREMISES AND TERM
Section 2.1. Effective as of, but not until, the Commencement Date, this Lease
supersedes and replaces the Original Lease and the RDRA, which Original Lease and RDRA shall
as of the Commencement Date be of no further force or effect, provided, however, that any
obligation to pay Rental under and as such term is defined in the Original Lease as modified by
the RDRA which remains unpaid at the Commencement Date (other than the obligation to pay
percentage rent for the year in which the Commencement Date occurs pursuant to Section
3.1(a)(iv)(ii) of the Original Lease), or any other obligation which is specifically stated to survive
the expiration or sooner termination of the Original Lease and the RDRA shall survive the
termination of the Original Lease and the RDRA, as the case may be, and Lessee’s failure to
perform such surviving obligations shall constitute a default under this Lease as if such obligations
had been set forth herein.
Section 2.2. Lessor does hereby demise and lease to Lessee, and Lessee does hereby hire
and take from Lessor, the Premises as described in Exhibit A-1 and Exhibit A-4 annexed hereto,
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together with all easements, appurtenances and other rights and privileges now or hereafter
belonging or appertaining to the Premises, including as shown in Exhibit A-2 and Exhibit A-3,
subject to the Title Matters, TO HAVE AND TO HOLD unto Lessee and its successors and
permitted assigns for the Term.
Section 2.3.
(a) Lessor hereby grants Lessee pedestrian easements in favor of Lessee and its
Sublessees, Occupants, permittees, licensees, contractors, employees, guests and other invitees to
utilize the area (the “Right of Way”) designated in Exhibit A-2 annexed hereto and on the 2020
Survey as “Pier 62 Access Easement” (the “Right of Way Area”), provided that to the extent the
“Pier 62 Access Easement” parcel includes a portion of the “Route 9A Access Parcel II” (as
defined in paragraph (b) below) such portion of the “Pier 62 Access Easement” may also be used
for the purposes of pedestrian and vehicular access to each pier within the Premises in the same
manner as the “Route 9A Access Parcel II” pursuant to paragraph (b) below. Lessee acknowledges
that in the case of the area designated in Exhibit A-2 and in the 2020 Survey as the “Pier 62 Access
Easement” such pedestrian easement shall (a) exclude all in-water areas existing (i) at the date of
this Lease and (ii) as may exist after the date of this Lease, and (b) be subject to (i) the
improvements in such area existing at the date of this Lease and (ii) as may exist after the date of
this Lease, and (b) be subject to (i) the improvements in such area existing at the date of this Lease
and (ii) such improvements as Lessor shall construct in such area after the date of this Lease
provided that any such improvements described in this clause (ii) do not materially impede or
restrict pedestrian access to the Premises. The Right of Way Area shall exist in favor of Lessee,
its Sublessees, Occupants, permittees, licensees, contractors, employees, guests and other invitees,
in accordance with the terms and conditions set forth in this Lease and shall run with the Land and
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be binding upon any subsequent owner of the Right of Way Area. In the event that title to the
Premises and the Right of Way Area is ever in separate ownership, and if the owner of the Right
of Way Area fails to comply with the obligations under this Lease, Lessor agrees to use all
reasonable efforts to assist Lessee in obtaining the Right of Way Area owner’s compliance with
the obligations under this Lease.
(b) Lessor acknowledges that Lessor has the obligation, subject to the rights of DOT,
to provide for pedestrian and vehicular access to each pier within the Premises. Lessor agrees that
for the purposes of the application of Section 2.3(b) herein, the areas designated in Exhibit A-3
annexed hereto and on the 2020 Survey as “Route 9A Access Parcel I” and “Route 9A Access
Parcel II” (together, the “Route 9A Access Parcels”) shall be deemed to constitute part of the Right
of Way Area. Lessor further acknowledges that DOT has confirmed by letter dated September 9,
2015, the sufficiency of which is hereby confirmed by Lessee, Lessee’s right to utilize the Route
9A Access Parcels subject to the modification of the boundary of the Route 9A Access Parcels that
is contiguous with Route 9A to conform to the boundary of Route 9A (the West Side Highway) as
finally determined by DOT in its comprehensive drawings filed of record by DOT upon
completion of the reconstruction of Route 9A (and upon such filing of record by DOT such
boundary of the Route 9A Access Parcels shall ipso facto be deemed to have been so modified)
provided that DOT confirms that such modifications will not materially impede or restrict the
vehicular access to the Premises using the Route 9A Access Parcels. Lessee acknowledges that
there shall be no abatement or diminution of Rental or any other consideration from Lessee due to
Lessor as a result of such modification. Lessee further acknowledges that it shall, subject to
limitations on liability and indemnification set forth in Section 24.9, accept and assume the
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obligation to manage the passage of vehicular traffic entering the Premises that crosses the
bikeway within Route 9A Access Parcel II.
Section 2.4. The initial term of this Lease shall commence on the Commencement Date
and expire at 11:59 pm on December 31 of the thirty-fourth (34
th
) year after December 31 of the
Lease Year in which the Commencement Date occurs (the “Initial Term Expiration Date”), unless
the term of this Lease shall be renewed as provided in Section 2.5, in which case the Term shall
refer to the term expiring at 11:59 pm on December 31 of the forty-fourth (44
th
) year after
December 31 of the Lease Year in which the Commencement Date occurs (the “Renewal Term
Expiration Date”) (the Initial Term Expiration Date, the Renewal Term Expiration Date, or such
other date upon which this Lease expires or is terminated as provided herein, the “Expiration
Date”, and the term of this Lease commencing on the Commencement Date and ending on the
Expiration Date, the “Term”).
Section 2.5. Lessee shall have the right, at its option and subject to Lessor approval as
set forth in this Section 2.5, to renew and extend the initial term of this Lease for all of the Premises
for one additional term of ten (10) years commencing on the day following the Initial Term
Expiration Date and ending at 11:59 pm on December 31 of the calendar year that is ten (10) years
after the calendar year in which the Initial Term Expiration Date occurs (the “Renewal Term”) by
giving to Lessor written notice of such renewal and extension for the Renewal Term not later than
the date that is eighteen (18) months prior to the date upon which the Renewal Term shall
commence (the “Renewal Notice”), time being of the essence with respect to the date upon which
Lessee delivers to Lessor the Renewal Notice. If Lessee fails to validly exercise the option for the
Renewal Term as aforesaid, the Term shall expire on the Initial Term Expiration Date and Lessee
shall have no further rights or options to renew and extend the initial term of this Lease to include
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the Renewal Term. Notwithstanding anything to the contrary contained herein, Lessee’s right to
exercise the option for the Renewal Term by delivering the Renewal Notice to Lessor in
accordance with this Section 2.5 shall be conditioned upon there being (i) no more than three (3)
Events of Default on the part of Lessee under this Lease during the three (3) years prior to the
Initial Term Expiration Date (which condition may be waived in the sole and absolute discretion
of Lessor), and (ii) no Event of Default on the part of Lessee which shall have occurred and then
be continuing on the date on which the Renewal Notice is given. If Lessee delivers a Renewal
Notice, but is not entitled to lease the Premises for the Renewal Term due to its failure to satisfy
the conditions set forth in this Section 2.5, Lessee shall nevertheless remain bound in all respects
to the terms and conditions of the Lease during the remainder of the Term, and the Term shall
expire on the Initial Term Expiration Date and Lessee shall have no further rights or options to
extend the initial term of this Lease to include the Renewal Term.
RENT
Section 3.1. Fixed Base Rent
(a) Lessee shall pay to Lessor a fixed rent (“Fixed Base Rent”) during the Term
without notice or (other than the notice set forth in Section 3.1(a)(iii)) demand in equal monthly
installments in advance due upon the first (1st) day of each month from the Commencement Date
to the Initial Term Expiration Date and, as applicable, the Renewal Term Expiration Date at the
following annual rates (subject as applicable to the provisions of Section 9.1(l)).
(i) For the purposes set forth herein, the Lease Year 1 means the period from the
Commencement Date to December 31 of the year in which the Commencement Date occurs, and
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each Lease Year thereafter shall mean the associated successive calendar year following, with
Lease Year 34 ending on December 31 of the thirty-third (33rd) calendar year after December 31
of the Lease Year in which the Commencement Date occurs and, should the Renewal Term then
be in effect, Lease Year 44 ending on December 31 of the forty-third (43rd) calendar year after
December 31 of the Lease Year in which the Commencement Date occurs.
(ii) “Scheduled Fixed Base Rent” shall be determined as follows and solely for
the purposes of establishing amounts due as of “Fixed Base Rent” and “Supplemental Fixed Base
Rent” pursuant to this Section 3.1:
(A) For each of calendar year 2022 and calendar year 2023,
annual Scheduled Fixed Base Rent shall equal $4,406,467.48 per annum.
(B) For each of calendar years 2024, 2026, 2028 and 2030 (and
for such other calendar years during the Term thereafter as set forth herein), annual Scheduled
Fixed Base Rent shall increase on the first day of such calendar year as compared to the prior
calendar year by the cumulative (i.e., compounded) annual percentage increases in CPI for the
immediately preceding two-year period, provided that the percentage change applied for each of
the two successive one-year (12-month) periods (as measured from December of the calendar year
immediately preceding the applicable 12-month period to December of such 12-month period)
which together comprise the immediately preceding two-year period (x) shall not exceed 3.5%
annually even if the CPI increase for such 12-month period is greater than 3.5%, and (y) shall not
be less than zero even if the CPI decreases for such 12-month period (the biennial percentage
change so determined subject to the aforementioned annual limitations with respect to CPI
increases in excess of 3.5% and CPI decreases for each two-year period designated in this Section
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3.1, the “Biennial Percentage Increase”). By way of example, the annual Scheduled Fixed Base
Rent for calendar year 2024 shall equal the annual Scheduled Fixed Base Rent for calendar year
2023 increased, in sequence such that the two years are compounded, first by the CPI increase for
the 12-month period from December 2021 to December 2022 and second by the CPI increase for
the 12-month period from December 2022 to December 2023, with the CPI increases for each such
12-month period not to exceed 3.5% (nor less than zero should the CPI decrease for any such 12-
month period). The calculation for each biennial increase in annual Scheduled Fixed Base Rent
during the Term resulting solely from the application of a Biennial Percentage Increase shall be
determined by multiplying the Biennial Percentage Increase by the annual Scheduled Fixed Base
Rent for the immediately preceding Lease Year and adding the resulting increase to annual
Scheduled Fixed Base Rent for the immediately preceding Lease Year. The Monthly Scheduled
Fixed Base Rent shall equal annual Scheduled Fixed Base Rent divided by twelve (12).
(C) The first monthly due date for the portion of annual Scheduled Fixed
Base Rent representing the increase determined by application of the Biennial Percentage Increase
shall be deferred and not be payable until the first day of the second month of such Lease Year
should the CPI not be publicly available until after the first of January of such Lease Year, provided
that a “make up” payment equal to the first month of the increase shall also be due, without interest
or penalty, on the first day of the second month of such Lease Year.
(D) For calendar year 2032, annual Scheduled Fixed Base Rent shall
increase on the first day of such calendar year as compared to the annual Scheduled Fixed Base
Rent for the prior calendar year by applying a percentage increase equal to the sum of (x) the
applicable Biennial Percentage Increase, plus (y) Seven and One-Half Percent (7.5%).
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(E) For each of calendar years 2034, 2036, 2038, 2040 and 2042, annual
Scheduled Fixed Base Rent shall increase on the first day of such calendar year as compared to
the annual Scheduled Fixed Base Rent for the prior calendar year by the percentage increase equal
to the applicable Biennial Percentage Increase.
(F) For calendar year 2043, annual Scheduled Fixed Base Rent shall
increase on the first day of such calendar year as compared to the annual Scheduled Fixed Base
Rent for the prior calendar year by applying a percentage increase equal to Ten Percent (10%).
(G) For each of calendar years 2044, 2046, 2048, 2050, 2052, 2054 and
(should the Initial Term Expiration Date not have occurred) 2056 (and, as applicable, every two
years thereafter during the Initial Term if the Commencement Date is postponed pursuant to
Section 39.29), annual Scheduled Fixed Base Rent shall increase on the first day of such Lease
Year as compared to the annual Scheduled Fixed Base Rent for the prior Lease Year by the
percentage increase equal to the applicable Biennial Percentage Increase.
(H) Should (i) the first year of the Renewal Term then be in effect for
calendar year 2056, annual Scheduled Fixed Base Rent shall increase on the first day of such
calendar year as compared to annual Scheduled Fixed Base Rent for the prior calendar year by
applying a percentage increase equal to the sum of (x) Five Percent (5.0%), plus (y) the applicable
Biennial Percentage Increase, or, (ii) the Renewal Term not begin until a calendar year later than
2056, then for the first year of the Renewal Term the annual Scheduled Fixed Base Rent shall
increase on the first day of such calendar year as compared to the annual Scheduled Fixed Base
Rent for the prior calendar year by a percentage increase equal to the sum of (x) Five Percent
(5.0%) plus, (y) either (AA) should the last applicable Biennial Percentage Increase during the
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Initial Term have been implemented two years prior to first year of the Renewal Term, then the
applicable Biennial Percentage Increase from the date of such prior increase, or (BB) should the
last applicable Biennial Percentage Increase during the Initial Term have been implemented in the
year immediately prior to the first year of the Renewal Term, then zero (0).
(I) Should the Renewal Term then be in effect, and (x) if an applicable
Biennial Percentage Increase had not been implemented for the first calendar year of the Renewal
Term as set forth in Section 3.1(a)(ii)(H), then for each of the second, fourth, sixth, eighth, and
tenth calendar years of the Renewal Term, annual Scheduled Fixed Base Rent shall increase on
the first day of such Lease Year as compared to the annual Scheduled Fixed Base Rent for the
prior Lease Year by the percentage increase equal to the applicable Biennial Percentage Increase,
with the first such Biennial Percentage Increase determined from the final year of the Initial Term,
or (y) if an applicable Biennial Percentage Increase had been implemented for the first calendar
year of the Renewal Term as set forth in Section 3.1(a)(ii)(H), for each of the third, fifth, seventh,
and ninth calendar years of the Renewal Term, annual Scheduled Fixed Base Rent shall increase
on the first day of such Lease Year as compared to the annual Scheduled Fixed Base Rent for the
prior Lease Year by the percentage increase equal to the applicable Biennial Percentage Increase
with the first such increase determined from the first year of the Renewal Term.
(J) For each calendar year in which a Biennial Percentage Increase is
not applicable, annual Scheduled Fixed Base Rent for such calendar year shall equal annual
Scheduled Fixed Base Rent for the immediately preceding calendar year such that there is no
change in annual Scheduled Fixed Base Rent as compared to the prior calendar year.
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(K) Should the first year and/or month and/or the final year and/or month
of the Term be less than a full calendar year and/or month, annual Scheduled Fixed Base Rent used
to determine annual Fixed Base Rent for such year and month shall be adjusted to be proportionate
to the number of days within the Term in such first or final Lease Year divided by 365, and the
monthly amount of Scheduled Fixed Base Rent payable for such first or final month shall be
adjusted to be proportionate to the number of days within the Term in such first or final month
divided by the number of days in that month, provided however that for purposes of Supplemental
Fixed Base Rent no such adjustment shall be made in Fixed Base Rent.
(iii) From and after the Commencement Date and throughout the Term, annual
Fixed Base Rent payable for any period shall be equal to the applicable annual Scheduled Fixed
Base Rent for such period, and monthly Fixed Base Rent shall equal one-twelfth of such amount.
Promptly after annual Scheduled Fixed Base Rent is increased in accordance with the preceding
provisions of this Section 3.1(a), Lessor shall notify Lessee of the increased annual Fixed Base
Rent and the amount of the percentage adjustment. If Lessor notifies Lessee of an increase in
annual Fixed Base Rent after January 1st of the Lease Year in which such increase becomes
effective, the increase set forth in Lessor's notice shall be applied retroactively to January 1st of
such Lease Year and on the first day of the month following the date of Lessor’s notice to Lessee
of such increase, Lessee shall pay any additional Fixed Base Rent that is due from January 1
st
of
such Lease Year together with the regular monthly installment of Fixed Base Rent for such month.
As set forth above, all percentage increases in annual Scheduled Fixed Base Rent set forth in this
Section 3.1, whether the result of a Biennial Percentage Increase or other percentage increases for
each of calendar year 2032, 2043 and, should the Renewal Term then be in effect, the first year of
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the Renewal Term, shall be applied successively as of the effective date of each such increase such
that increases in annual Scheduled Fixed Base Rent during the Term are compounded.
(iv) On the date on which the Commencement Date occurs, Lessee shall pay to
Lessor as supplemental Fixed Base Rent (“Supplemental Fixed Base Rent”) an amount equal to
the difference between (x) Scheduled Fixed Base Rent for the period from January 1, 2022 to the
day before the Commencement Date and (y) the amount of Base Rent paid to Lessor by CPLP as
tenant under the Original Lease for such period pursuant to Section 3.4(a)(iv)(i) of the Original
Lease.
(v) Lessee shall not be liable for the payment of Scheduled Fixed Base Rent
except to the extent of Lessee’s obligation to pay Fixed Base Rent and Supplemental Fixed Base
Rent from and after the Commencement Date. For the avoidance of doubt, Scheduled Fixed Base
Rent as determined in accordance with this Section 3.1 is used solely for the purpose of
establishing Fixed Base Rent and Supplemental Fixed Base Rent from and after the
Commencement Date, and only Monthly Fixed Base Rent, annual Fixed Base Rent and
Supplemental Fixed Base Rent are due on a current basis, without duplication with respect to
Scheduled Fixed Base Rent, on such dates and in the manner set forth in this Section 3.1.
Section 3.2 Intentionally Omitted
Section 3.3 Percentage Rent
(a) Lessee shall pay to Lessor for each Lease Year during the Term without notice or
demand percentage rent (“Percentage Rent”) in an amount equal to the Percentage Rent Allocation
for the Applicable Percentage Rent Year less the Percentage Rent Deduction for such Applicable
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Percentage Rent Year, such amount to be not less than zero (0). Percentage Rent for each Lease
Year shall be payable in full upon the same date that Lessee submits the Annual CPA Statement
for such Lease Year pursuant to Section 3.3(h).
(b) As used herein, the Applicable Percentage Rent Year for a Lease Year shall mean
the calendar year that precedes the last day of such Lease Year. The first Applicable Percentage
Rent Year for which Percentage Rent is payable shall be all of the calendar year in which the
Commencement Date occurs notwithstanding that the Commencement Date may occur after the
first day of such calendar year. If the Commencement Date occurs, Lessee shall not have any
obligation to pay to Lessor any percentage rent pursuant to Section 3.1(a)(iv)(ii) of the Original
Lease for the calendar year in which the Commencement Date occurs.
(c) As used herein, the Percentage Rent Allocation for an Applicable Percentage Rent
Year shall mean the sum of (i) Three Percent (3%) multiplied by the amount by which Gross
Revenues for the Applicable Percentage Rent Year exceed $60 million and are less than or equal
to $90 million, plus, if applicable (ii) Three and One-Half Percent (3.5%) multiplied by the amount
by which Gross Revenues for the Applicable Percentage Rent Year exceed $90 million and are
less than or equal to $100 million, plus, if applicable (iii) Four Percent (4%) multiplied by the
amount by which Gross Revenues for the Applicable Percentage Rent Year exceed $100 million
and are less than or equal to $110 million, plus, if applicable (iv) Four and One-Half Percent (4.5%)
multiplied by the amount by which Gross Revenues for the Applicable Percentage Rent Year
exceed $110 million and are less than or equal to $120 million, plus, if applicable (v) Five Percent
(5%) multiplied by the amount by which Gross Revenues for the Applicable Percentage Rent Year
exceed $120 million. Should the final Lease Year be less than a full calendar year, the dollar
threshold amounts specified above in clauses (i), (ii), (iii), (iv) and (v) of this Section 3.3(c) to
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determine the Percentage Rent Allocation shall be adjusted to be proportionate to the number of
days in such final Lease Year divided by 365.
(d) As used herein, the Percentage Rent Deduction for each Applicable Percentage
Rent Year shall mean (i) a fixed amount equal to $4,052,527.89 multiplied, on a compound basis,
by the Biennial Percentage Increase then in effect cumulatively with respect to annual Scheduled
Fixed Base Rent from January 1, 2022 to and including the last month of the Applicable Percentage
Rent Year, less (ii) a fixed amount equal to $3,465,212. For the purposes set forth herein,
percentage increases in annual Scheduled Fixed Base Rent which are not Biennial Percentage
Increases shall not be included in the calculation of the Percentage Rent Deduction. Should the
final Lease Year be less than a full calendar year, the calculated dollar amount determined pursuant
to clause (i) and fixed dollar amount set forth in clause (ii) of this Section 3.3(d) to determine the
Percentage Rent Deduction shall be adjusted to be proportionate to the number of days in such
final Lease Year divided by 365. Appendix B to this Lease depicts, for illustrative purposes only,
the calculation of the Percentage Rent Allocations based on hypothetical assumptions about the
annual Gross Revenues and the calculation of the Percentage Rent Deduction based on
hypothetical assumptions about increases to the Scheduled Fixed Base Rent on account of CPI
increases.
(e) As used herein, “Gross Revenues” for an Applicable Percentage Rent Year shall
mean the aggregate gross revenues of CPLP and NROC for such Applicable Percentage Rent Year
as determined in accordance with GAAP. For the avoidance of doubt, it is the intent of the parties
that for all purposes of the calculation of “Gross Revenues” in accordance with the provisions of
this Article 3, the Gross Revenues for any period shall consist of the sum of the Gross Revenues
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of NROC, the Gross Revenues of CPLP and the Gross Revenues of their Affiliates the results of
which are consolidated with the results of CPLP and/or NROC under GAAP for such period.
(f) [Reserved].
(g) Notwithstanding anything to the contrary contained in this Section 3.3, Gross
Revenues shall be further subject to the following annual adjustments:
(i) For any portion of the Premises that was used by an Affiliate of Lessee in a
preceding Applicable Percentage Rent Year and then used by an Occupant that was not an Affiliate
of Lessee, Gross Revenues with respect to such portion shall be the greatest of: (x) if the foregoing
change in the user of such portion of the Premises occurs during the first five (5) Lease Years
following the Commencement Date, Gross Revenues from such Affiliate of Lessee generated from
such portion of the Premises in calendar year 2019 multiplied by the compound annual increase in
CPI since such year, (y) the highest of Gross Revenues such Affiliate of Lessee generated from
such portion of the Premises in one of the three Applicable Percentage Rent Years preceding the
change in use multiplied by the compound annual increase in CPI since such Applicable
Percentage Rent Year, and (z) Gross Revenues generated from such portion of the Premises in the
Applicable Percentage Rent Year from such Occupant. If a change in Occupant contemplated by
this clause (i) occurs for a portion of the Premises, then for each of the applicable Lease Years,
Lessee shall provide to Lessor a written statement prepared by Lessee’s independent certified
public accountant prepared in accordance with GAAP of such Gross Revenues from such Affiliate
from such portion of the Premises for the applicable Lease Years.
(ii) For any portion of the Premises that was used by an Occupant in a preceding
Applicable Percentage Rent Year for a non-office use and then used by an Occupant for office use,
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Gross Revenues with respect to such portion shall be the greater of: (x) the highest of Gross
Revenues generated from such portion of the Premises from such non-office Occupant in one of
the three Applicable Percentage Rent Years preceding such change in use multiplied by the
compound annual increase in CPI since such Applicable Percentage Rent Year, and (y) Gross
Revenues generated from such portion of the Premises in the Applicable Percentage Rent Year
from such office Occupant.
(iii) Lessee shall provide Lessor with Gross Revenues information relating to a
sublease with an Affiliate of Lessee, a non-office Occupant, or an Occupant (which information
may include contract rent and other fees to be collected prospectively from Occupants and included
in Gross Revenue), as applicable under the circumstance(s) set forth in Section 3.3 (g)(i) and
(g)(ii), within thirty (30) days after entering into such sublease(s).
(iv) Should revenue of an Affiliate of Lessee that is an Occupant not be included
in Gross Revenues under GAAP then, during the period that such Affiliate's revenue is not
included in Gross Revenues under GAAP, Lessee shall include as Gross Revenue with respect to
such Occupant the amount of rent and other charges that are equivalent to the fair market rental
for such period established as of the date of the execution of the applicable sublease with such
Occupant (with the understanding that such Affiliate shall not be required to pay such fair market
rental under such sublease so long as such fair market value is included in calculating Gross
Revenues for purposes of this Section 3.3). As of the Commencement Date, the only such Affiliate
of Lessee is Pier Sixty LLC, and Lessor and Lessee hereby confirm for the purpose of this Section
3.3(g)(iv) that the rent payable under the Pier Sixty LLC sublease shall be deemed to be the fair
market rental under such sublease as of the Execution Date. When Lessee enters into a sublease
with an Affiliate of Lessee that is not Pier Sixty LLC, Lessee shall provide Notice to Lessor that,
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in Lessee's good faith judgment, the rent under such sublease that would be not less than the fair
market rent for the applicable space (which amount shall not be required to be equal to the rent
actually payable by such sublessee under such sublease). Included with such Notice shall be such
documentation as Lessee believes reasonable to support its judgement. Upon submission of such
Notice to Lessor, Lessee shall make payment to Lessor as a review fee the amount of Five
Thousand Dollars ($5,000) as such amount is increased from the Execution Date to the date of
such request by the CPI Adjuster. The rent under such sublease that is deemed to be includible in
Gross Revenues for purposes of this Section 3.3 shall further be subject to Lessor's review and
concurrence that the rent under such sublease that is deemed to be includible in Gross Revenues
for purposes of this Section 3.3 is not less than the fair market rent for the subleased space, such
concurrence not to be unreasonably withheld, conditioned or delayed. Should Lessor determine
in its reasonable judgment that the rent proposed by Lessee as includible in Gross Revenues is not
fair market rent for the applicable sublease as of the date of execution thereof, then Lessee shall
either (x) agree that the rent under such sublease that is deemed to be includible in Gross Revenues
for purposes of this Section 3.3 shall be the rent cited by Lessor in its determination or (y) provide
further substantiation to Lessor that the rent under such sublease that is deemed to be fair market
rental under such sublease and hence includible in Gross Revenues for purposes of this Section
3.3 is consistent with the rent proposed by Lessee. If either Lessee or Lessor determines that
Lessee and Lessor are unable to agree on the rent under such sublease that is deemed to be
includible in Gross Revenues for purposes of this Section 3.3, then the party making such
determination may give Notice thereof (the date of such Notice, the "Election Date") and the rent
under such sublease that is deemed to be includible in Gross Revenues for purposes of this Section
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3.3 (together with such periodic rental escalations as are industry standard) shall be determined in
accordance with the following procedure:
(A) Lessor shall propose to Lessee a list of appraisers that would be
acceptable to Lessor for purposes of determining the rent under such sublease that is deemed to be
the fair market rental for the applicable space as of the date of execution of such sublease (together
with such periodic rental escalations as are industry standard) and hence to be includible in Gross
Revenues for purposes of this Section 3.3.
(B) Lessee shall choose one appraiser from the list provided by Lessor,
and Lessor shall engage and pay the fees of such appraiser (subject to reimbursement by Lessee to
Lessor within 30 days of request by Lessor) for determining such appraiser’s estimate of the rent
under such sublease that should be deemed to be the fair market rent for the applicable space as of
the date of the execution of such sublease (together with such periodic rental escalations as are
industry standard) and hence to be includible in Gross Revenues for purposes of this Section 3.3.
Lessor shall provide to Lessee a copy of Lessor’s engagement of such appraiser and shall provide
to Lessee promptly upon issuance or receipt a copy of each communication between Lessor and
such appraiser with respect to the valuation assignment, including such appraiser’s determination
as to the rent under such sublease that should be deemed to be the fair market rent for the applicable
space as of the date of the execution of such sublease (together with such periodic rental escalations
as are industry standard) and hence to be includible in Gross Revenues for purposes of this Section
3.3.
(C) Within five (5) Business Days after receipt by Lessee of such
appraiser’s report and determination as to the rent under such sublease that should be deemed to
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be the fair market rent for the applicable space as of the date of the execution of such sublease
(together with such periodic rental escalations as are industry standard) and hence to be includible
in Gross Revenues for purposes of this Section 3.3, Lessee shall give Notice to Lessor as to whether
Lessee elects to proceed with such sublease and include in Gross Revenues for purposes of this
Section 3.3 the amount determined by such appraiser as the rent under such sublease that should
be deemed to be the fair market rent for the applicable space as of the date of the execution of such
sublease (together with such periodic rental escalations as are industry standard) or whether Lessee
will not proceed with such sublease. If Lessee elects to proceed with such sublease, then for so
long as such sublease remains in effect Lessee shall include in Gross Revenues for purposes of
this Section 3.3 the amount determined by such appraiser as the fair market rent under such
sublease as of the date of execution of such sublease together with such periodic rental escalations
as the appraiser determines to be industry standard.
(D) Nothing in this Section 3.3(g) shall obligate Lessee to enter into any
proposed sublease or to actually charge to and collect from any sublessee any amount other than
an amount agreed to by Lessee and such sublessee (whether or not such amount corresponds to the
amount agreed by Lessor and Lessee or determined by an appraiser as the fair market rent under
such sublease as of the date of execution of such sublease (and/or such periodic rental escalations
as are industry standard) for purposes of this Section 3.3).
(h) Within thirty (30) days after Lessee completes the audit of its financial statements
for each applicable Lease Year, but no later than May 1
st
after the end of such Lease Year (which
date Lessee shall have the right, by notice given to Lessor no later than May 1 of the applicable
year, to extend by no more than sixty (60) days provided that together with such notice Lessee
pays to Lessor the amount that Lessee estimates is equal to the amount of Percentage Rent that is
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payable for the prior Lease Year and, together with the Annual CPA Statement (as such term is
hereinafter defined) for the prior Lease Year, Lessee pays to Lessor any positive difference
between Percentage Rent for the applicable Lease Year as reflected in the Annual CPA Statement
and the estimated amount paid by Lessee together with such notice (and if such difference is
negative, then so long as no Event of Default has occurred and is continuing Lessee shall be entitled
by notice to Lessor to credit the absolute value of such amount against the next amounts coming
due from Lessee to Lessor hereunder)), Lessee shall deliver to Lessor a written statement prepared
by Lessee’s independent certified public accountant prepared in accordance with GAAP (the
“Annual CPA Statement”) which shall certify:
(i) Gross Revenues on a consolidated basis in accordance with GAAP
for the Applicable Percentage Rent Year with each Annual CPA Statement in such form Lessor
may reasonably require and contain such information with respect to the calculation of Gross
Revenues in accordance with GAAP as is necessary to confirm Lessee’s compliance with the terms
of this Lease defining and describing Gross Revenues.
(ii) Percentage Rent due for the Applicable Percentage Rent Year
calculated in accordance with this Section 3.3.
(i) Within thirty (30) days after Lessee completes the audit of its financial statements
for each applicable Lease Year, but no later than May 1st after the end of such Lease Year, Lessee
shall provide Lessor with a statement, certified by an authorized officer of Lessee as of the date of
submittal, (A) as to whether since the date of the last such certified statement there has been a
Change in Control in the general partner of NROC or CPLP, or whether a Transfer has occurred
that required the consent of the Lessor, and (B) a listing (together with floor plans if requested by
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Lessor) of Usable Square Footage for each space at the Premises used by an Occupant or used for
Lessee’s business purposes from which it generates Gross Revenues together with a designation
as to whether all or portions of each such space is Sports and Recreation, together with a copy of
the rent roll for such Lease Year, itemized by Occupant. Exhibit K lists the Usable Square Footage
area utilized by Lessee and the Occupants at the Premises as of the Execution Date. Lessee shall
update such list annually in accordance with this Section 3.3(i) or more frequently should there be
a change within a Lease Year.
(j) Lessor shall have the right, upon reasonable advance notice to Lessee and subject
to Confidentiality, to inspect all Occupants’ Occupancy Agreements. In addition, if at any time
Lessee regularly files periodic reports with the Securities and Exchange Commission (“SEC”)
under the Securities Exchange Act of 1934, as amended, Lessee shall provide Lessor with copies
of each such periodic report promptly upon the filing of same with the SEC.
Section 3.4. Transaction Rent
(a) If at any time during the Term there should occur a Transaction, then, at the time
or times specified in Sections 3.4(f) and (g) with respect to the applicable Transaction, Lessee shall
pay as additional Rental an amount (the “Transaction Rent”) equal to 2.5% of the difference
between (i) the gross proceeds received by Lessee or its equity owners as a result of such
transaction(s) (the “Gross Proceeds”) and (ii) the actual out-of-pocket costs and expenses incurred
by Lessee or its equity owners directly in connection with the Transaction as further defined in
Section 3.4(b)(iii) (the “Transaction Costs”).
(b) For the purposes set forth herein with regard to Transaction Rent:
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(i) Transaction means (A) a Major Sublease other than (1) a Major Sublease
to an Affiliate of Lessee and (2) a Major Sublease to Lessee that is entered into by a successor to
Lessee’s interest under this Lease as part of an integrated transaction with a Transfer of Lessee’s
interest under this Lease to such successor (i.e., a transaction in the nature of a sale-leaseback)
where (x) such Transfer and Major Sublease are consented to by Lessor in accordance with the
terms of this Lease, (y) Transaction Rent is paid with respect to such Transfer of Lessee’s interest
under this Lease pursuant to this Section 3.4, and (z) pursuant to the Major Sublease to Lessee,
Lessee has primary operating responsibility for the day to day management and operation of the
Premises notwithstanding the Transfer, (B) any transaction defined as a Transfer in Section 8.1,
[except for a Major Sublease of the sort described in Section 3.4(b)(i)(A)(2)], (C) a trading of
publicly traded equity interests that is the result of a merger, consolidation or tender offer as
described in Section 8.1(a)(iv)(A), (D) a sale, transfer or assignment by Lessee of Lessee’s interest
in any Person that operates a business at the Premises other than as part of a transaction that is
otherwise described in this Section 3.4(b)(i), or (E) any other transaction which, by virtue of the
occurrence of a Change of Control, constitutes the functional equivalent of a transaction set forth
in clauses (B), (C), or (D) of this Section 3.4(b)(i), in each case in a single transaction or a series
of related transactions, and without regard to whether Lessor’s consent is required to consummate
such transaction (a transaction or series of related transactions that is described in one or more of
clauses (A)-(E) of this Section 3.4(b)(i), a “Transaction”).
(ii) Gross Proceeds of a Transaction means: (A) all cash proceeds, (B) the fair
market value of any property, other than cash or debt obligations, (C) the principal amount of any
mortgages or debt assumed by the acquiring party or to which the Transaction is made subject, (D)
the face amount of any purchase money note or debt obligation made in connection with the
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Transaction, (E) in the case of a Major Sublease, the difference during the term of the Major
Sublease between (x) all rental received by Lessee under such Major Sublease and (y) the Rental
payable by Lessee under this Lease (other than Transaction Rent), which amounts shall be pro-
rated based on a Usable Square Footage calculation if less than the entire Premises is included in
the Major Sublease), and (F) all other consideration actually received by Lessee or owners of
owners of equity interests in Lessee in connection with the Transaction. If the agreement pursuant
to which the Transaction is occurring (the “Purchase Agreement”) involves the transfer of assets
or equity interests in addition to the Transaction described herein, the total consideration payable
to Lessee or owners of owners of equity interests in Lessee pursuant to the Purchase Agreement
shall be expressly and reasonably allocated among all of the assets or equity interests being
transferred pursuant to the Purchase Agreement, and that portion of the total consideration
specifically allocated to the Transaction pursuant to this Lease shall be deemed to be the Gross
Proceeds of the Transaction for purposes of this Section 3.4(b)(ii). A true and complete copy of
the Purchase Agreement, certified as such by an officer of Lessee, shall be delivered to Lessor by
Lessee together with notice of the Transaction. Transaction Costs, as set forth in Section
3.4(b)(iii), shall be reasonably allocated among the various assets and equity interests being
transferred pursuant to the Purchase Agreement on the same basis as the consideration has been
allocated, except that any Transaction Costs that are specifically attributable to an asset or equity
interest being transferred pursuant to the Purchase Agreement, such as, for example, transfer taxes
that are imposed in connection with the transfer of a leasehold interest, shall be allocated to the
asset or equity interest to which such cost is specifically attributable.
(iii) Transaction Costs of a Transaction means any reasonable and customary
expenses incurred directly by Lessee or owners of owners of equity interests in Lessee effectuating
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the Transaction including, but not limited to, brokerage commissions, attorney’s fees, transfer and
gains taxes and title insurance premiums, provided that if any Transaction Costs are payable to
Lessee’s Affiliates then such costs shall not exceed the amounts that would have been paid to an
unrelated party in an arm’s length transaction for similar items or services in New York City.
(c) A Transaction shall not include the acquisition of the leasehold interest in the
Premises by a Mortgagee or its nominee or designee by foreclosure or a deed or instrument of
transfer delivered in lieu of such foreclosure or by a third party purchaser by foreclosure, or by a
purchaser of the Lessee’s interest in the Premises from a Mortgagee or its nominee or designee
following such foreclosure or delivery of a deed or instrument of transfer delivered in lieu of such
foreclosure (other than a purchaser from a Mortgagee or its nominee or designee which Mortgagee,
nominee or designee has operated the Premises for thirty-six (36) months or more after the
foreclosure or delivery of a deed or instrument of transfer delivered in lieu of such foreclosure).
(d) It is understood that once an item has been included in Gross Proceeds or
Transaction Costs it shall not be included again such that each dollar of Gross Proceeds or
Transaction Costs shall only be counted once in determining Transaction Rent for the same
Transaction.
(e) A statement by Lessee’s Certified Public Accountant and an officer of Lessee shall
accompany each payment of Transaction Rent detailing all relevant calculations and certifying the
accuracy and completeness of such payment.
(f) For purposes of this Section 3.4, a Transaction shall only be deemed to have
occurred upon the closing of such Transaction (or in the case of a series of related transactions the
closing of the transaction that results in a Change of Control, provided that additional Transaction
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Rent may be due upon the closing of subsequent related Transactions to which the parties were
contractually bound at the time of the closing of the transaction for which the initial Transaction
Rent was payable). Transaction Rent shall in no event be payable with respect to a Transaction
unless and until the closing of such Transaction has occurred (or in the case of a series of related
transactions unless and until the closing of the Transaction that results in a Change of Control).
For Transactions involving trading or transfers of publicly traded equity interests, Transaction Rent
shall be payable within thirty (30) days after the closing of the Transaction (or in the case of a
series of related transactions the closing of the Transaction that results in a Change of Control, and
the closing of any subsequent related Transactions to which the parties were contractually bound
at the time of the closing of the Transaction for which the initial Transaction Rent was payable).
For Transactions that do not involve trading or transfers of publicly traded equity interests,
Transaction Rent shall be payable upon the closing of the Transaction (or in the case of a series of
related transactions the closing of the transaction that results in a Change of Control, provided that
additional Transaction Rent may be due upon the closing of subsequent related Transactions to
which the parties were contractually bound at the time of the closing of the transaction for which
the initial Transaction Rent was payable).
(g) For a Transaction consisting of a Major Sublease, Transaction Rent shall be payable
on a monthly basis commencing upon the first day of the first month following the commencement
of the term of such Major Sublease and continuing until the expiration or sooner termination of
the term of the Major Sublease, in an amount equal to 2.5% of a monthly figure determined by
calculating the difference between (x) all rental (including all amounts otherwise included as
Gross Revenues that are attributable to such Major Sublease) received by Lessee under such Major
Sublease for such month, and (y) the sum of (i) the Rental payable by Lessee under this Lease
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(other than Transaction Rent) for such month with (A) the Percentage Rent portion of payable
Rental estimated as equal to Percentage Rent paid by Lessee to Lessor in the prior Lease Year
divided by twelve (12), and (B) the PILOT portion of Rental deemed to equal the immediately
prior payment of PILOT by Lessee to Lessor divided by six (6) or such other number of months
for which such PILOT amount constitutes advance payment under NYCDOF rules then in effect,
such amount of Rental pro-rated based on a Usable Square Footage calculation if less than the
entire Premises is included in the Major Sublease, and (ii) applicable Transaction Costs divided
by the number of months in the term of the Major Sublease, such calculated difference amount not
to be less than zero (0). Should Lessee receive final payments under such Major Sublease after
the expiration or sooner termination of the Major Sublease, then Transaction Rent shall be
calculated and made payable upon such final payments as if they were received in the month prior
to such expiration or sooner termination. Notwithstanding anything to contrary contained herein,
the statement by Lessee’s Certified Public Accountant required pursuant to Section 3.4(e) with
respect Transaction Rent due as the result of a Major Sublease shall be provided to Lessor annually
and included as part of the Annual CPA Statement pursuant to Section 3.3(h), with Transaction
Rent adjusted as may be necessary to reconcile Percentage Rent estimated pursuant to clause
(y)(i)(A) of this Section 3.4(i) to the actual Percentage Rent for the Lease Year in which such
Transaction Rent payments are made. If an adjustment to Transaction Rent due as a result of a
Major Sublease is determined to be necessary for any Lease Year as set forth in the immediately
preceding sentence of this Section 3.4(i), then Lessor shall issue a refund to Lessee within thirty
(30) days for any overpayment and Lessee shall pay as additional Rental to Lessor within thirty
(30) days for any underpayment. If the term of a Major Sublease commences on other than the
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first day of a month or expires on other than the last day of a month, Transaction Rent for such
months shall be pro-rated based on the number of days in such month.
(h) No Transaction Rent shall be payable with respect to a Transaction that has been
contracted for if the closing of such Transaction does not occur for any reason, including without
limitation the failure to obtain any required consent of Lessor or any other third party or the
determination by Lessee or any counterparty not to proceed to the closing of such Transaction
whether such determination was permitted by or constituted a breach of the contractual agreements
with respect to such Transaction. Notwithstanding the foregoing, if Lessee is entitled to retain a
down payment or other liquidated sum from the counterparty to the proposed Transaction as a
result of the failure of the parties to close the Transaction, the sum retained by Lessee shall be
deemed to be Gross Proceeds for purposes of this Section 3.4 and Lessee shall pay Lessor the
Transaction Rent that would be due and payable with respect to such Gross Proceeds in accordance
with the provisions of this Section 3.4.
Section 3.5. PILOT
(a) Throughout the Term, Lessee shall pay as Rental to Lessor as payments-in-lieu-of
taxes (“PILOT ”) semi-annually at the times when Real Property Taxes are customarily paid to the
City (i.e., as of the date hereof, January 1
st
and July 1
st
). PILOT for any period of the Term means
the Real Property Taxes which the City would levy on the Premises for such period of the Term
based on assessed value as determined by New York City Department of Finance (“NYCDOF”)
and the rate for Class 4 property as if the Premises were not owned by a tax-exempt entity, subject
to any exemptions or abatements for which the Premises would be eligible during such year if the
Premises were not owned by such a tax-exempt entity, provided that the owner has met all
requirements for such exemptions or abatements other than making any filings that the applicable
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agency declines to accept because the Premises is owned by a tax-exempt entity and other than the
requirement that the Premises be owned by an entity that is not a tax-exempt entity, and such
exemptions or abatements certificates to the extent available from the City have been issued by
the City.
(b) Notwithstanding anything to the contrary in this Section 3.5, to the extent that
during any period of the Term prior to July 1, 2023, under the RDRA (had the RDRA remained in
effect) Lessee would have been entitled to pay PILOT in equal monthly installments, Lessee shall
be entitled to pay PILOT monthly in equal installments rather than semi-annually as if the
provision of the RDRA relating to payment of PILOT in monthly installments had remained in
effect during such period.
(c) As of the Commencement Date, the Premises shall consist of the following block
and lots of the tax map of the NYCDOF: (i) the entirety of Block 662, Lots 11, 16 and 19, (ii)
portion of Block 662, Lot 7, and (iii) portion of Block 662, Lot 62. In addition, the sidewalk and
driveway area extending from the eastern façade of the Headhouse to the western boundary of the
Rte. 9 bikeway is a part of the Premises but is not included as an identified block and lot.
Commencing no later than six (6) months after the Commencement Date and continuing thereafter
until the tax lot merger or subdivision process described in this Section 3.5(c) has been completed,
Lessee shall use reasonable commercial efforts and reasonable diligence to undertake, at Lessee’s
sole cost and expense, the steps necessary to cause NYCDOF to modify through tax lot merger or
subdivision the boundaries of the then-current tax lot designation of Block 662, Lot 62 so that such
boundaries are the same as the corresponding northern and western boundaries of the Premises as
identified in the 2020 Survey. At Lessee’s expense, Lessor shall cooperate with Lessee’s efforts
pursuant to this Section 3.5(c), including by executing and delivering all documentation then in
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Lessor’s possession reasonably requested by Lessee or the NYCDOF in connection with such
efforts. For the purposes set forth herein to determine PILOT, assessment of the value of land and
building, actual and transitional, shall be as determined by the NYCDOF standards, regulations
and procedures and shall be performed by NYCDOF as if Lessee is (A) except as described in
clauses (B) and (C)(y) of this sentence, the fee owner of the entire Premises other than the portion
of Block 662, Lot 7 that is included in the Premises, (B) if the tax lot merger or subdivision process
described in this Section 3.5(c) has not been completed by the date that is three years four months
after the Execution Date, the fee owner of 40.5% of the land comprising Lot 62 of Block 662, and
fee owner of 100% of the building or buildings located on Lot 62 Block 662, and (C) from and
after the first to occur of completion of the tax lot merger or subdivision process described in this
Section 3.5(c) and the date that is three years after the Commencement Date, (x) unless and until
the tax lot merger or subdivision process described in this Section 3.5(c) is completed, the fee
owner of 100% of Lot 62 of Block 662, both land and building or buildings or (y) from and after
completion of the tax lot merger or subdivision process described in this Section 3.5(c) the portion
of the area of the current Block 662, Lot 62 that is identified in the 2020 Survey as the portion of
Pier 62 parcel that is part of the Premises. No PILOT shall be due for any portion of Block 662,
Lot 7 at any time during the Term of this Lease. Notwithstanding anything to the contrary set forth
herein, Lessee’s limitation with respect to the payment of PILOT (x) for Block 662, Lot 7 shall be
conditioned on Lessee not reporting or allocating any revenue or income for Lot 7 on Lessee’s
submitted NYCDOF Income and Expense Statement, and (y) for Block 662, Lot 62 shall be
conditioned on Lessee not reporting or allocating any revenue or income for Lot 62 on Lessee’s
submitted NYCDOF Income and Expense Statement that is greater in proportion to Lessee’s total
revenue or income than the proportion of Lessee’s total revenue or income so reported or allocated
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for calendar year 2019. Should Lessee breach the conditions set forth in either clause (x) or (y) of
this Section 3.5(c), then Lessee shall be responsible for the payment of PILOT for the entirety of
the respective tax lot. In addition, and without limitation to the foregoing, Lessee shall not report
or allocate any revenue or income to the sidewalk and driveway area extending from the eastern
façade of the Headhouse to the western boundary of the Rte. 9 bikeway which area is within the
Premises.
(d) Lessee shall submit when due an annual income and expense statement to
NYCDOF together with any other information required by NYCDOF in connection with
establishing assessments. For the avoidance of doubt, at any time the Premises are used as an
“income-producing property,” as that term is used in City Administrative Code Section 11-208.1
(or successor thereto), Lessee shall furnish to NYCDOF income and expense statements of the
type required by such code section (or successor thereto) (the “NYCDOF Income and Expense
Statement”) as if Lessee owned fee title to the Premises to the extent and as provided in Section
3.5(c), and such statements to be submitted within the time periods and to the address provided for
in said Section 11-208.1 and such statements to be submitted notwithstanding that the State holds
fee title to the Premises. Lessee shall be afforded the same right as all NYCDOF property
taxpayers to contest the assessment pursuant to applicable law, and may enjoy the benefit of
transitional versus actual assessments as determined by NYCDOF. Lessor shall serve as the
nominal applicant or petitioner for review of the assessment if Lessee is deemed to lack the
required legal standing to act on its own.
(e) If any proceeding initiated by Lessee contesting assessed value shall result in a final
determination in Lessee’s favor, the amount of PILOT shall be recomputed by Lessor based on the
revised assessment for the period(s) in dispute, and Lessee shall be granted a credit representing
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the amount by which PILOT paid by Lessee exceeds PILOT so recomputed (the “PILOT Credit”).
Lessee may apply the PILOT Credit against the next succeeding installment(s) of PILOT,
provided, however, that the maximum amount of PILOT Credit applied against any such single
installment of PILOT shall not exceed one-third (1/3rd) of the amount due under such installment
of PILOT prior to the application of such credit, but any unapplied portion of the PILOT Credit
shall accrue and be available for application (subject to the aforesaid 1/3rd limitation) against
future installments that come due and payable. If Lessee is entitled to receive a PILOT Credit, and
if at that time the City is paying interest on refunds of real property taxes, then the PILOT Credit
due to Lessee shall include interest at the rate then being paid by the City on such refunds of Real
Property Taxes. If, at the end of the term of this Lease, Lessee has any remaining unapplied PILOT
Credit, the amount of any such remaining unapplied PILOT Credit shall be paid by Lessor to
Lessee within sixty (60) days.
(f) Notwithstanding anything to the contrary contained in this Section 3.5 or elsewhere
in this Lease, from and after the date that Real Property Taxes are directly assessed by a
Governmental Authority against the Premises, or any part thereof, and, accordingly, are payable
directly by Lessee to such Governmental Authority, Lessee shall no longer be required to pay
PILOT payments pursuant to this Section 3.5, except to the extent that Lessee is delinquent in its
obligation to pay prior payments of PILOT pursuant to the terms of this Lease.
Section 3.6. Rental
(a) Fixed Base Rent, Supplemental Fixed Base Rent, Percentage Rent, Transaction
Rent and PILOT are all deemed Rental under this Lease payable to Lessor. Rental shall be paid
by wire transfer, certified check, bank cashier’s check or money order payable to the order of the
Hudson River Park Trust, or such other person as shall be designated by the Lessor, and drawn on
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an account at a bank that is a member of the New York Clearing House Association (or any
successor body of similar function) or a bank which has an office in New York City and which is
a member of any other check clearing association or system in use by money center banks in New
York City and payable in currency which at the time of payment is legal tender for public or private
debts in the United States of America. If paid by wire transfer, payment shall be transferred to an
account designated by Lessor by notice to Lessee and if paid by check, shall be mailed or delivered
to the office of the Hudson River Park Trust at Pier 40, 353 West Street, 2nd Floor, New York,
NY 10014 or at such other place as Lessor shall direct by notice to Lessee. The annual Fixed Base
Rent due for any period of less than a full twelve-month period, and any installment of the Fixed
Base Rent due for any period of less than a full month, and semi-annual PILOT payment due for
any period less than six months, shall be appropriately apportioned. For any installment of Rental
that is not received by Lessor on its due date, Lessee shall pay interest at the Applicable Rate on
the overdue amount until the date of the payment.
(b) Any Impositions payable to Lessor and any other payments required to be made by
Lessee to Lessor shall constitute Rental under this Lease and shall be payable to and in the form
required by the entity imposing such Imposition. Except as expressly set forth herein. Rental shall
be absolutely net to Lessor without any abatement, deduction, counterclaim, set-off or offset
whatsoever and Lessee shall pay all costs, expenses and charges of every kind and nature relating
to the Premises except as expressly set forth to the contrary in this Lease, provided that the
foregoing shall not require Lessee to pay any costs or expenses of Lessor relating to Lessor’s
consents of approvals, unless specifically provided for in this Lease.
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IMPOSITIONS
Section 4.1. Lessee shall pay, as hereinafter provided, all of the following items
(collectively, “Impositions”) that at any time are imposed by any Governmental Authority: (a)
personal property taxes, (b) occupancy and rent taxes assessed against Lessee, (c) water, water
meter and sewer rents, rates and charges, (d) excises, (e) levies, (f) license and permit fees, (g)
service charges with respect to police protection, fire protection, street and highway construction,
maintenance and lighting, sanitation and water supply, if any, (h) any special assessments imposed
by any special assessment district that is an entity distinct from Lessor to the extent such
assessment is imposed on all other similarly situated properties as Lessee’s and is not duplicative
of any payments made under Section 3.5 of this Lease, (i) occupancy and rent taxes imposed upon
tenants generally, (j) fines, penalties and other similar or like governmental charges applicable to
the foregoing and any interest or costs of collection with respect thereto, and (k) any and all other
governmental levies, fees, rents, assessments or taxes and charges, general and special, ordinary
and extraordinary, foreseen and unforeseen, of any kind and nature whatsoever, and any interest
or costs of collection with respect thereto which at any time during the Term are (1) assessed,
levied, confirmed, imposed upon or become due and payable out of or in respect of, or are charged
with respect to, the Premises for periods during the Term or the use and occupancy thereof by
Lessee or (2) encumbrances or liens on (i) the Premises, or (ii) the sidewalks or streets in front of
or adjoining the Premises, or (iii) any vault (other than a vault in respect of which a utility company
is obligated to pay any charge specified above or which is exempt from any such charge by reason
of use therefor by any such utility company), bridge, passageway or space in, over or under such
sidewalk or street, or (iv) any other appurtenances of the Premises, or (v) any personal property
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(except personal property which is not owned by or leased to Lessee), Equipment or other facility
used in the operation thereof, or (vi) the Rental (or any portion thereof) payable by Lessee
hereunder, or (vii) any document to which Lessee is a party acquiring, creating or transferring an
interest or estate in the Premises, or (viii) this Lease, each such imposition, or installment thereof,
during the Term to be paid by Lessee directly to the Governmental Authority imposing the same
not later than the Due Date thereof. However, if, by law, any Imposition payable by Lessee
hereunder may at the option of the taxpayer be paid in installments (whether or not interest shall
accrue on the unpaid balance of such Imposition), Lessee may exercise the option to pay the same
in such installments and shall be responsible for the payment of such installments only, together
with applicable interest, if any, provided that all such installment payments together with
applicable interest if any, relating to periods prior to the date definitely fixed in Article 2 for the
expiration of the Term shall be made prior to the Expiration Date. Within thirty (30) days after
exercising such option, Lessee shall notify Lessor if Lessee shall have elected to pay any such
Imposition in installments.
Section 4.2. Notwithstanding anything to the contrary contained in this Article or
elsewhere in this Lease, (i) to the extent that the Premises, or any part thereof, or Lessor as owner
of the Premises, are exempt from the payment of any Real Property Taxes with respect to the
Premises, Lessee shall be entitled to the benefit of such exemption, and (ii) as of the
Commencement Date, the entire Premises and Lessor as owner of the Premises, are so exempt.
However, if at any time during the Term any Real Property Taxes that were previously exempt
become assessed, levied, confirmed or imposed upon the Premises or Lessor with respect to the
Premises and payable, then Lessee, in addition to its other obligations hereunder, shall be required
to pay such Real Property Taxes that were previously exempt directly to the applicable
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Governmental Authority, provided that in the event that such Real Property Taxes are directly
assessed against the Premises, or any part thereof, and, accordingly, are thereafter payable by
Lessee directly to such Governmental Authority, then, from and after the day immediately after
the date that the Premises are so assessed and amounts payable, Lessee shall no longer be required
to pay PILOT payments pursuant to Section 3.5 to Lessor except to the extent that deferred PILOT,
delinquent PILOT, PILOT arrearage or PILOT otherwise payable to Lessor for the portion of the
Term prior to such day, together with interest and penalties payable thereon, shall be due to Lessor
pursuant to the terms of this Lease.
Section 4.3. Lessee, from time to time, but no later than thirty (30) days after the date
when an Imposition is due and payable under this Lease, shall promptly furnish to Lessor official
receipts of the appropriate imposing authority, or other evidence reasonably satisfactory to Lessor,
evidencing the payment of Impositions payable by Lessee hereunder.
Section 4.4. Any Imposition payable by Lessee hereunder relating to a period a part of
which is included within the Term and a part of which is included in a period of time after the
Expiration Date (whether or not such Imposition is assessed, levied, confirmed or imposed upon
or in respect of or becomes a lien upon the Premises, or becomes payable, during the Term) shall
be apportioned between Lessor and Lessee as of the Expiration Date so that Lessee shall pay that
portion of such Imposition which that part of such fiscal period included in the period of time
before the Expiration Date bears to such fiscal period, and Lessor shall pay the remainder thereof
(unless the Expiration Date has occurred as a result of any Event of Default, in which case the
Lessee shall not be entitled to an apportionment unless otherwise set forth in Article 22).
Section 4.5. Lessee shall have the right to contest the amount or validity, in whole or in
part, of any Imposition by appropriate proceedings diligently conducted in good faith, in which
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event, notwithstanding the provisions of Section 4.1, payment of such Imposition shall be
postponed if, and only as long as:
(a) neither the Premises nor any part thereof, or interest of Lessor therein, would, by
reason of such postponement or deferment, be, in the reasonable judgment of Lessor, in imminent
danger of being forfeited or lost and neither Lessor nor Lessee would by reason thereof be subject
to any criminal liability or penalty, or civil liability or penalty in excess of the amount for which
Lessee has furnished security as provided in paragraph (b) below; and
(b) Lessee shall have deposited with Depository cash or other security reasonably
satisfactory to Lessor in the amount so contested and unpaid, together with all interest and penalties
in connection therewith and all charges that may or might be assessed against or become a charge
on the Premises or any part thereof in such proceedings. If at any time during the continuance of
such proceedings Lessor, in its sole reasonable discretion, shall deem insufficient the amount or
nature of any security delivered by Lessee with Depository as security for Lessee’s obligation to
pay any such postponed or deferred Imposition, Lessee shall deliver to the Depository such
additional security, satisfactory to Lessor, in Lessor’s sole reasonable discretion, as Lessor may
request. If Lessee shall fail to deliver to Lessor such additional collateral security within ten (10)
days after Lessor’s demand therefor, Lessor may direct the Depository to apply the proceeds of
the security held by the Depository to the payment, removal and discharge of any such deferred or
postponed Imposition and the interest and penalties in connection therewith and any costs, fees
(including, without limitation, court costs and attorney’s fees and disbursements) or other liability
accruing in any such proceedings and the balance, if any, remaining after application by Depository
as aforesaid, together with the interest, if any, earned thereon, shall be returned to Lessee or to the
Person entitled to receive it. Lessee shall remain liable for any unpaid balance of such Imposition
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remaining after payment by the Depository as aforesaid, and Lessee shall pay the balance to Lessor
or the Person entitled to receive it, within ten (10) days after Lessor’s demand.
Upon the termination of such proceedings, it shall be the obligation of Lessee to pay the
amount of such Imposition or part thereof as finally determined in such proceedings, the payment
of which may have been deferred during the prosecution of such proceedings, together with any
costs, fees (including attorney’s fees and disbursements), interest, penalties or other liabilities that
such proceedings determine are payable by Lessee or with respect to the Premises, and upon such
payment, Depository shall return, with interest, if any, any amount deposited with it as aforesaid;
provided, however, that any agreement between Lessee and the Depository shall require that
Depository, at Lessee’s request or, upon Lessee’s failure to do so in a timely manner, at Lessor’s
request, shall disburse said moneys on deposit with it directly to the Governmental Authority to
whom such Imposition is payable and any remaining monies, with interest, if any, shall be returned
promptly to Lessee. If, at any time during the continuance of such proceedings, Lessor, in its
reasonable opinion, deems insufficient the amount deposited as aforesaid, Lessee, within fifteen
(15) days after demand, shall make an additional deposit of such additional sums or other
acceptable security as Lessor may request (provided that the amount so requested shall not exceed
the amount in controversy in such proceedings). If, in Lessor’s reasonable judgment, the Premises
or any part thereof or interest therein of Lessor become in imminent danger of being forfeited or
lost by reason of any proceedings contemplated by this Section 4.5, or if Lessor is in imminent
danger of being subject to a criminal penalty or civil liability in excess of the amount deposited by
Lessee, the amount theretofore deposited may be applied at the request of Lessor to the payment,
removal and discharge of such Imposition and the interest and penalties in connection therewith
and any costs, fees (including reasonable attorney’s fees and disbursement) payable by Lessee or
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with respect to the Premises or other liability accruing in any such proceedings, and the balance,
if any, with any interest earned thereon, shall be returned to Lessee or the deficiency, if any, shall
be paid by Lessee to Lessor within ten (10) days after demand. Following any such application,
Lessee shall have the sole right, at its sole cost, to institute or continue the prosecution of
proceedings for the redetermination, refund or rebate of any amounts so paid or applied and, if
successful, to retain the entire amount so refunded or rebated. If at any time during the continuance
of such proceedings, Lessor, in its sole reasonable discretion, shall deem insufficient the amount
or nature of any security delivered by Lessee with Depository as security for Lessee’s obligation
to pay any such postponed or deferred Imposition, Lessee shall deliver to the Depository such
additional security, satisfactory to Lessor, in Lessor’s sole reasonable discretion, as Lessor may
request. If Lessee shall fail to deliver to Lessor such additional collateral security within ten (10)
days after Lessor’s demand therefor, Lessor may direct the Depository to apply the proceeds of
the security held by the Depository to the payment, removal and discharge of any such deferred or
postponed Imposition and the interest and penalties in connection therewith and any costs, fees
(including, without limitation, court costs and attorney’s fees and disbursements) or other liability
accruing in any such proceedings and the balance, if any, remaining after application by Depository
as aforesaid, together with the interest, if any, earned thereon, shall be returned to Lessee or to the
Person entitled to receive it. Lessee shall remain liable for any unpaid balance of such Imposition
remaining after payment by the Depository as aforesaid, and Lessee shall pay the balance to Lessor
or the Person entitled to receive it, within ten (10) days after Lessor’s demand.
Section 4.6. Lessee shall have the right but not the obligation to seek a reduction in the
valuation of the Premises assessed for Real Property Taxes, whether then payable by Lessee
directly to an applicable Government Authority or not, and to prosecute or discontinue any
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applications, legal actions or proceedings in connection therewith. Such applications, legal actions
or proceedings shall be at no cost to Lessor and Lessee agrees to indemnify and hold Lessor
harmless against any loss or liability arising therefrom. Lessee shall within fifteen (15) days of
making all such applications, legal actions or proceedings provide Lessor with copies of Lessee’s
submissions in connection therewith.
Section 4.7. Lessor shall not be required to join in any applications, legal actions or
proceedings referred to in Section 4.5 or Section 4.6 unless the provisions of any law, rule or
regulation at the time in effect require that such proceedings be brought by or in the name of
Lessor, in which event Lessor shall join and provide such cooperation that is necessary or
reasonably desirable to support any such application, legal action or proceeding, including
authorizing any such proceedings or permit the same to be brought in its name but Lessor shall not
be liable for the payment of any costs or expenses in connection with any such applications, legal
actions or proceedings and Lessee shall reimburse Lessor, within twenty (20) days after demand,
for all costs and expenses that Lessor may reasonably incur in connection with any such
applications, legal actions or proceedings, including reasonable attorney’s fees and disbursements.
If Lessee institutes applications, legal actions or proceedings referred to in Section 4.5 or Section
4.6 and no law, rule or regulation in effect at the time requires that such proceeding be brought by
and/or in the name of Lessor, Lessor, nevertheless, shall, at Lessee’s cost and subject to the
reimbursement provisions hereinabove set forth, cooperate with Lessee in such proceeding,
provided that Lessee shall, at Lessee’s election, either directly pay Lessor’s reasonable third-party
cost and expenses incurred in connection with such proceeding or promptly reimburse Lessor for
such reasonable third-party costs and expenses, which reimbursement shall be deemed to be
additional Rental.
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Section 4.8. Any certificate, advice or bill of the appropriate official designated by law
to make or issue the same or to receive payment of any Imposition asserting non-payment of such
Imposition shall be prima facie evidence that such Imposition is due and unpaid at the time of the
making or issuance of such certificate, advice or bill, at the time or date stated therein.
Section 4.9. Lessee shall in no event have any liability for the payment of any Imposition
or other tax, charge, levy, fee, rent or assessment (or interest, penalties or collection charges
applicable thereto) imposed upon Lessor and that is based upon or measured by the income or
capital of Lessor not directly related to the Premises, including without limitation, any federal,
state or local income, or franchise taxes, based or measured as aforesaid, imposed upon or payable
by Lessor, all of which shall be timely paid or discharged by Lessor to the extent they would
otherwise become or give rise to the right on the part of any Governmental Authority to impose a
lien upon the Premises.
Section 4.10. To the full extent permitted by law, Lessee shall be entitled to the benefit of
any as-of-right abatement or exemption from any tax, charge, levy, fee, rent (other than Rental
under the Lease), assessment or Imposition imposed by any Governmental Authority upon or with
respect to the Premises or any part thereof to which Lessor would be entitled if the Premises were
not, and no part thereof were, or Lessor as owner of the Premises were not, exempt from the
payment of any Real Property Taxes with respect to the Premises.
Section 4.11. In connection with any Improvements constructed by Lessee during the
Term in accordance with this Lease (together with any Improvements existing on the
Commencement Date), Lessor shall make available to Lessee the exemption from sales tax
available to Lessor as a result of Lessor’s interest in the Premises, and any risk of the availability
of such exemption shall be borne solely by Lessee. Lessee acknowledges that, to the extent
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available, the sales tax exemption shall be limited to materials incorporated into the Premises and
other Improvements on the Premises. In connection with the grant of such exemption, Lessor shall
provide to Lessee an appropriate letter setting forth the exemptions contained in this Section 4.11.
Except for such Improvements, neither Lessee nor any Occupant (nor their contractors,
subcontractors or materialmen) may claim any sales tax exemption solely by virtue of Lessor’s
interest with respect to any other improvements either performed by Lessee or its Occupants. All
risk associated with the availability and/or applicability of such exemption from sales tax shall be
borne solely by Lessee.
Section 4.12. The provisions of this Article 4 will survive the expiration or sooner
termination of this Lease.
INSURANCE
Section 5.1. At all times during the Term, or as otherwise required by this Lease, Lessee,
at its sole cost and expense, shall obtain and maintain in full force and effect, or cause to be carried
and maintained in full force and effect, the insurance coverage provided at Exhibit F attached
hereto but in no event less than any limits that are required by any applicable Requirements. Lessee
shall cause all insurance to be in full force and effect as of the Commencement Date and to remain
in full force and effect throughout the Term and as further required by this Lease. Lessee shall not
take any action nor shall Lessee omit to take any action that it is not otherwise legally prohibited
from performing that would suspend or invalidate any of the required coverage during the period
of time such coverage is required to be in effect.
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Section 5.2. Lessee shall include a requirement in all Subleases or Occupancy
Agreements with Occupants that are executed after the Commencement Date (including renewals
and modifications to existing agreements) that Occupants are required, at all times during the terms
of such Subleases or Occupancy Agreements to (i) maintain Commercial General Liability
insurance naming, as additional insureds thereunder, each Additional Insured listed in Exhibit F,
with limits appropriate to the premises similar to the premises covered by such Subleases or
Occupancy Agreements and to the business operations of a size, nature and character similar to
the business conducted by such Occupants at the premises covered by such Subleases or
Occupancy Agreements, and to cause any contractor or subcontractor performing work within the
Occupant’s premises to carry and maintain insurance with the same limits as set forth in Exhibit
F, Paragraph (d), but in no event less than any limits that may be required by any applicable
Requirements, and (ii) provide to Lessor, from time to time within ten (10) days after Lessor’s
written request, certificates to Lessor evidencing the maintenance of such insurance and the
naming of each Additional Insured (as defined in Exhibit F and solely with respect to those
insurance policies on which the Additional Insureds are obligated to be named) such that there is
no gap in the protection to each Additional Insured afforded by such certificates. Lessee shall,
upon its discovery that any Occupant is not in compliance with the terms of its Occupancy
Agreement that are summarized in this Section 5.2, promptly demand of the applicable Occupant
that such Occupant immediately comply with such terms, and if such Occupant does not promptly
comply with such terms, Lessee shall promptly commence and thereafter diligently proceed in
exercising all rights of Lessee, as lessor under the Occupancy Agreement, in connection with such
Occupant’s failure to comply with the terms of its Occupancy Agreement, including, without
limitation, seeking an order of a court of competent jurisdiction compelling such compliance
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through the commencement of any action for the removal from the Premises of such Occupant. In
addition, if the Occupant fails to provide Lessor with a copy of a certificate in accordance with the
provisions of clause (ii) above, Lessee will provide Lessor with a copy of an insurance certificate
provided to Lessee by such Occupant, if such certificate is in Lessee’s possession, within ten (10)
days after request from Lessor or (b) request a copy of the Occupant’s insurance certificate within
three (3) days after request from Lessor and provide such copy to Lessor immediately upon receipt
from the Occupant.
CASUALTY
Section 6.1. (a) If all or any part of any of the Improvements is destroyed or
damaged in whole or in part by fire or other casualty (including any casualty for which insurance
was not obtained or obtainable) of any kind or nature, ordinary or extraordinary, foreseen or
unforeseen (a “Casualty”), Lessee shall give to Lessor notice thereof (i) within two (2) Business
Days if the reasonably expected estimated cost of repairs, alterations, restorations, replacements
and rebuilding (collectively, “Restoration”) is in excess of $250,000, and (ii) within seven (7)
Business Days if the reasonably expected estimated Restoration cost is less than or equal to
$250,000, except that no notice shall be required if the estimated cost of Restoration is less than
$100,000. Upon the occurrence of a Casualty, Lessee shall (subject to Unavoidable Delays)
immediately remove all debris from the Premises if the same causes the Premises to be in an unsafe
condition and with reasonable diligence (subject to Unavoidable Delays) repair, alter, restore,
replace and rebuild (collectively, “Restore”) the same as nearly as possible to the value, utility and
character of the Improvements existing immediately prior to such occurrence in accordance with
the provisions of this Lease. If Lessee fails to remove any debris from the Premises as provided
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above or to Restore with reasonable diligence (subject to Unavoidable Delays), in accordance with
the terms of this Lease, the value, utility and, if possible, the character of Improvements or the
portion thereof so damaged or destroyed, or, having so commenced such required Restoration,
fails to complete the same with reasonable diligence (subject to Unavoidable Delays), in
accordance with the terms of this Lease, or if, prior to the completion of any such required
Restoration by Lessee, this Lease expires or is terminated for any reason, Lessor may, but shall
not be required to, remove the debris as provided above and/or complete such required Restoration
at Lessee’s expense. Each such Restoration shall be done in accordance with the provisions of this
Lease. In any case where this Lease expires or is terminated prior to the completion of Restoration,
Lessee shall account to Lessor for all amounts spent in connection with any Restoration that was
undertaken and shall pay over to Lessor, within ten (10) days after demand, the remainder, if any,
of the Restoration Funds previously received by it. Lessee’s obligations under this Section 6.1
shall survive the expiration or termination of this Lease.
(b) Notwithstanding the provisions of Section 6.1(a) above, Lessee shall not be
obligated to Restore the Improvements as provided in said Section 6.1(a) if the Casualty occurs at
any time within two years of either the Initial Term Expiration Date or Renewal Term Expiration
Date as set forth in this Section 6.1(b). If there is a Casualty which meets the conditions set forth
in the immediately preceding sentence, and the insurance policies required to be maintained
pursuant to Article 5 and Exhibit F hereof are in full force and effect, then Lessee may advise
Lessor, not later than sixty (60) days from the date of said Casualty, that it elects to terminate this
Lease. Such termination shall be made by (A) serving upon Lessor, at any time within said sixty
(60) day period, a thirty (30) days’ written notice of Lessee’s election to so terminate, and (B)
subject to the rights of any recognized Mortgagee, assigning over to Lessor all of Lessee’s right,
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title and interest in and to all available insurance and other proceeds payable due to such damage
or destruction but subject to the continuing obligation of Lessee to reasonably assist (to the extent
necessary) in the prosecution of all insurance and other claims relating to the Casualty. In
particular, all proceeds of insurance collected as a result of such occurrence, including Business
Interruption Insurance notwithstanding the provision in Exhibit F, paragraph (j)(12), other than
any insurance on Lessee’s personal property and Trade Fixtures (which shall be disbursed to
Lessee), shall be disbursed to Lessor. Upon the service of such notice and the making of such
assignment and payment within the period aforesaid, and the satisfaction by Lessee of a senior
Mortgagee’s loan, if any, this Lease shall terminate on the date specified in such notice with the
same force and effect as if such date were the Expiration Date, and Lessee shall comply with the
surrender requirements of Article 29 hereof but only to the extent reasonably feasible. Any
amounts due and owing to Lessor up to and including the date of termination shall survive
termination and shall be payable in accordance with this Lease.
Section 6.2. (a) Subject to the provisions of Sections 6.3, 6.4, and, if applicable, 6.5,
Depository shall pay over to Lessee from time to time, upon the following terms, any monies
received by Depository from insurance provided by Lessee together with interest earned thereon,
if any, or cash or the proceeds of any security deposited with Depository pursuant to Section 6.5,
together with interest earned thereon, if any (collectively, the “Restoration Funds”); provided,
however, that Depository, before paying such moneys over to Lessee, shall be entitled to reimburse
itself, the Mortgagee and Lessor therefrom to the extent, if any, of the necessary, reasonable and
proper expenses (including reasonable attorney’s fees and disbursements) paid or incurred by
Depository and Lessor in the collection of such monies. Depository shall pay to Lessee, as
hereinafter provided, the Restoration Funds, for the purpose of the Restoration.
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(b) Prior to commencing any Restoration, Lessee shall furnish Lessor an estimate of
the cost of such Restoration, prepared by a licensed professional engineer or licensed architect
selected by Lessee and approved by Lessor (which approval shall not be unreasonably withheld).
Lessor may engage a licensed professional engineer or licensed architect to review the estimate of
the cost of such Restoration. If there is any dispute as to the estimated cost of the Restoration, such
dispute shall be resolved by expedited arbitration in accordance with the provisions of Article 32.
(c) The Restoration Funds shall be paid from time to time to Lessee in installments as
the Restoration progresses, in the manner and at the times as required by the senior Mortgagee. If
there is no Mortgagee or if the Mortgage held by the senior Mortgagee has no provision
substantially similar to those herein for the disbursement of the Restoration Funds, then subject to
the provisions of Sections 6.3, 6.4 and, if applicable, 6.5, the Restoration Funds shall be paid to
Lessee in installments as the work progresses upon application to be submitted by Lessee to
Depository with a copy to Lessor showing the cost of labor and materials, services, fixtures and
equipment purchased and delivered to the Premises for incorporation in the Restoration, or
incorporated therein since the last previous application, and due and payable or paid by Lessee. If
any vendor’s, mechanic’s, laborer’s or materialman’s lien is filed against the Premises or any part
thereof, or if any public improvement lien relating to the Restoration of the Premises is created or
permitted to be created by Lessee and is filed against Lessor, or any assets of, or funds appropriated
to, Lessor, Lessee shall not be entitled to receive any further installment until such lien is satisfied
or discharged (by bonding or otherwise). Notwithstanding the foregoing, subject to the provisions
of Section 6.2(d), the existence of any such lien shall not preclude Lessee from receiving any
installment of Restoration Funds, provided such lien will be discharged with funds from such
installment.
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(d) The amount of any installment of the Restoration Funds to be paid to Lessee shall
be (i) the product of (x) the total Restoration Funds and (y) a fraction, the numerator of which is
the cost of labor and materials, services, fixtures and equipment theretofore incorporated (or
delivered to the Premises to be incorporated) by Lessee in the Restoration and the denominator of
which is the total estimated cost of the Restoration (determined in accordance with Section 6.2(b)),
less (ii) (A) all payments theretofore made to Lessee out of the Restoration Funds and (B) ten
percent (10%) of the amount so determined until completion of fifty percent (50%) of the
Restoration and five percent (5%) of the amount so determined thereafter until completion of the
Restoration.
(e) Upon completion of the Restoration and upon application for final payment
submitted by Lessee to Depository and in compliance with the conditions set forth in Section 6.3,
the balance of the Restoration Funds shall be paid to Lessee to pay Lessee’s contractors for
amounts due and remaining unpaid on account of work performed in connection with the
Restoration and not disputed by Lessee and any amounts retained under such contracts, and the
balance of the Restoration Funds shall be paid to Lessee, subject to the rights of any Mortgagees.
(f) Notwithstanding the foregoing, if pursuant to Section 6.1(a) Lessor has the right to
make, and makes the Restoration at Lessee’s expense, then Depository shall pay over the
Restoration Funds to Lessor, upon request, to the extent not previously paid to Lessee pursuant to
this Section 6.2, and Lessee shall pay (if it is required to pay for Restoration pursuant to Section
6.1(a) to Lessor, within ten (10) days after demand, any sums in excess of the portion of the
Restoration Funds received by Lessor necessary to complete the Restoration. Upon completion of
the Restoration, Lessor shall deliver to Lessee a certificate, in reasonable detail, setting forth the
expenditures made by Lessor for such Restoration.
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(g) The foregoing provisions of this Section 6.2, and the provisions of Section 6.4 to
the extent they relate to disbursement of Restoration Funds to Lessee, shall be superseded by any
reasonable provisions, providing comparable protection to Lessor, that are contained in a Mortgage
both issued and held by an Institutional Lender; provided, however, that the provisions hereof and
those of any such Mortgage shall be read in such a way as to minimize any inconsistency and only
Restoration Funds not necessary for Restoration or expenses due to Lessor hereunder as
specifically set forth in this Lease shall be applied to such Institutional Lender’s indebtedness.
Section 6.3. The following shall be conditions precedent to each payment made to
Lessee as provided in Section 6.2 above:
(a) there shall be submitted to Depository with a copy to Lessor the certificate of the
aforesaid engineer or architect selected by Lessee and reasonably approved by Lessor pursuant to
Section 6.2(b) stating that (i) the sum then requested to be withdrawn either has been paid by
Lessee or is due and payable to contractors, subcontractors, materialmen, engineers, architects or
other Persons (whose names and addresses shall be stated) who have rendered or furnished
services, work, labor, fixtures, equipment or materials for the work and giving a brief description
of such services, work, labor, fixtures, equipment and materials and the several amounts so paid
or due to each of said Persons in respect thereof, and stating in reasonable detail the progress of
the work up to the date of said certificate, (ii) no part of such expenditures has been or is being
made the basis, in any previous or then pending requisition, for the withdrawal of the Restoration
Funds or has been paid out of the Restoration Funds previously received by Lessee, (iii) the sum
then requested does not exceed the value of the services, work, labor, fixtures, equipment and
materials described in the certificate, and (iv) to the best of his or her knowledge, the balance of
the Restoration Funds held by Depository (including any bond, cash or other security provided by
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Lessee in accordance with Section 6.5 hereof) will be sufficient upon completion of the Restoration
to pay for the same in full, and estimating in reasonable detail the cost of such completion
(provided, however, that Lessor will accept the certificate of an officer or principal of Lessee in
lieu of that of such engineer or architect as to statements contained in clauses (ii) and (iii));
(b) there shall be furnished to Lessor an official search, report or update, or a certificate
of a title insurance company reasonably satisfactory to Lessor, or other evidence reasonably
satisfactory to Lessor, showing that there are no vendor’s, mechanic’s, laborer’s or materialman’s
statutory or other similar liens filed against the Premises or any part thereof, or any public
improvement liens created or caused to be created by Lessee with respect to the Premises or the
Restoration or affecting Lessor, or the assets of, or funds appropriated to, Lessor, which has not
been discharged of record (by bonding or otherwise) except such as will be discharged upon
payment of the requisite amount out of the sum then requested to be withdrawn; and
(c) at the time of making such payment, there is no existing and unremedied Event of
Default or monetary Default of which Lessor has given notice to Lessee.
Section 6.4. (a) If any loss, damage or destruction occurs which Lessee is required
to Restore pursuant to this Lease, and the cost of Restoration of which, determined as provided in
Section 6.2(b), equals or exceeds Two Million Dollars ($2,000,000) in the aggregate, Lessee shall
furnish to Lessor the following:
(i) at least thirty (30) days prior to commencement of such Restoration,
complete plans and specifications for the Restoration, prepared by a licensed professional engineer
or licensed architect selected by Lessee and approved by Lessor, which approval shall not be
unreasonably withheld, together with the approval thereof and any required permits issued by any
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Governmental Authority with respect to the Restoration and such plans and specifications, and, at
the request of Lessor, any other drawings, information or samples to which Lessor is entitled under
Article 11, all of the foregoing to be subject to Lessor’s approval, which approval shall not be
withheld provided either (x) such plans and specifications conform to the Construction Documents
or (y) such plans and specifications do not so conform but (A) provide for design, finishes and
materials with respect to the Improvements that are comparable to those reflected in the
Construction Documents and (B) that do not, in Lessor’s reasonable opinion, adversely affect the
support of the Improvements; all such plans and specifications and other materials for the
Restoration shall become the sole and absolute property of Lessor if for any reason this Lease is
terminated;
(ii) at least ten (10) Business Days prior to commencement of such Restoration,
a contract or construction management agreement reasonably satisfactory to Lessor in form
assignable to Lessor (subject to any prior assignment to any Mortgagee), made with a contractor
or construction manager approved by Lessor, which approval shall not be withheld so long as the
contractor is reputable and responsible, as reasonably determined by Lessor, providing for the
completion of the Restoration in accordance with said plans and specifications, free and clear of
all liens, encumbrances, security agreements, interests and financing statements relating thereto;
(iii) at least ten (10) Business Days prior to commencement of such Restoration,
an assignment to Lessor (subject to any prior assignment to any Mortgagee) of the contract so
furnished and the bonds, if any, provided thereunder, such assignment to be duly executed and
acknowledged by Lessee and by its terms to be effective only upon any termination of this Lease
or upon Lessor’s re-entry upon the Premises following an Event of Default prior to the complete
performance of such contract, such assignment also to include the benefit of all payments made on
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account of said contract including payments made prior to the effective date of such assignment;
and
(iv) at least ten (10) Business Days prior to commencement of such Restoration,
insurance policies issued by responsible insurers, bearing notations evidencing the payment of
premiums or accompanied by other evidence satisfactory to Lessor of such payments, for the
insurance required set forth in Exhibit F.
(b) Notwithstanding that the cost of Restoration is less than Two Million Dollars
($2,000,000), to the extent that any portion of the Restoration involves any material change in the
exterior of or public access to the Improvements or use thereof from that which existed
immediately prior to the damage or destruction, or a change in the bulk, setback or support of the
Improvements or a material change in the height of the Improvements from the exterior/ bulk,
setback, support or height existing immediately prior to the damage or destruction, then Lessee
shall furnish to Lessor at least thirty (30) Business Days prior to commencement of the Restoration
a complete set of plans and specifications for the Restoration involving such work or such change,
prepared by a licensed professional engineer or licensed architect approved by Lessor, which
approval shall not be unreasonably withheld, and, at Lessor’s request, such other items designated
in Section 6.4(a)(i), all of the foregoing to be subject to Lessor’s review and approval as provided
in Section 6.4(a)(i).
(c) If Lessee wishes to modify the plans and specifications that Lessor theretofore has
approved pursuant to Section 6.4(a)(i) or 6.4(b) so as to affect any material aspect of the exterior
of the Improvements or to change the bulk, setback or support of or public access to the
Improvements or materially to change the height of the Improvements, Lessee shall submit the
proposed modifications to Lessor for Lessor’s approval. Lessor’s approval shall not be withheld
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if the proposed changes provide for design, finishes and materials with respect to the
Improvements that substantially conform to those reflected in the approved plans and
specifications and do not adversely affect the support of the Improvements. If Lessor denies
approval of the proposed changes, it shall so notify Lessee, specifying the reason for such denial
in reasonable detail and Lessee shall revise the plans and specifications so as to meet Lessor’s
objections and shall deliver the same to Lessor for review within ten (10) Business Days of the
date of the notice from Lessor to Lessee. Each review by Lessor shall be carried out within ten
(10) Business Days of the date of delivery of the plans and specifications, as so revised (or one or
more portions thereof), by Lessee and if Lessor does not notify Lessee of its determination within
such ten (10) Business Day period, it shall be deemed to have approved the proposed changes.
Lessor’s approval shall not be required with respect to portions of the approved plans and
specifications that Lessor has previously approved, provided the same have not been changed by
Lessee.
Section 6.5. If the estimated cost of any Restoration exceeds the greater of $2,500,000
and the net Restoration Funds received by Depository, then, prior to the commencement of such
Restoration, Lessee shall deliver to Lessor or deposit with Depository, evidence reasonably
satisfactory to Lessor of the financial ability of Lessee to pay the amount of such excess and a
letter representing and warranting that it will pay such excess, which evidence may, at Lessee’s
election, consist of a letter of credit, loan commitment, surety bond, completion guaranty (from a
credit-worthy entity reasonably acceptable to Lessor) or any combination of the foregoing or such
other security as may be reasonably satisfactory to Lessor, in the amount of such excess.
Section 6.6. Except as otherwise expressly provided in this Lease, this Lease shall not
terminate or be forfeited or affected in any manner, and there shall be no reduction or abatement
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of the Rental payable hereunder, by reason of damage to or total, substantial or partial destruction
of any of the Improvements or any part thereof or by reason of the untenantability of the same or
any part thereof, for or due to any reason or cause whatsoever, and Lessee, notwithstanding any
law or statute present or future, waives any and all rights to quit or surrender the Premises or any
part thereof. Lessee expressly agrees that its obligations hereunder, including, without limitation,
the payment of Rental, shall continue as though the Improvements had not been damaged or
destroyed and without abatement, suspension, diminution or reduction of any kind. It is the
intention of Lessor and Lessee that the foregoing is an “express agreement to the contrary” as
provided in Section 227 of the Real Property Law of the State of New York. Notwithstanding the
foregoing, if any Restoration project restoring damage to the Improvements other than the Lessee
Improvements will take more than three months, the Lease Term shall toll pending the completion
of the Restoration provided that Lessee is diligently, and in good faith, proceeding with such
Restoration, subject to Unavoidable Delay. A partial abatement of Rental for such period of tolling
will apply after the required one year of Business Interruption Insurance is exhausted in an amount
reasonably determined by Lessor to be proportionate to the area of the Premises so affected by the
Casualty and such Restoration.
Section 6.7. If for any completed Restoration Lessee has not theretofore delivered the
same to Lessor, Lessee shall deliver to Lessor, within thirty (30) days of the completion of such
Restoration, a complete set of “as built” plans therefor together with a statement in writing from a
licensed architect or licensed professional engineer that such plans are complete and correct.
Section 6.8. (a) The provisions of Article 11 shall apply to Restoration.
(b) The provisions of Sections 6.1(a), 6.2(a), 6.2(b), 6.2(c), 6.2(d), 6.2(e) and 6.2(f)
relating to payment of Restoration Funds to Lessee shall, at Lessee’s option, apply not to Lessee
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but to a Sublessee (that is named as an insured or additional insured), provided Lessee remains
liable for such Restoration.
(c) Any Restoration undertaken by Lessee pursuant to this Lease where consent of
Lessor is not required shall be deemed to have been approved by Lessor.
Section 6.9. Any Restoration Funds remaining after the completion of the Restoration
by Lessee shall be paid to Lessee subject to the rights of the Mortgagees.
Section 6.10. In the event there is no Depository at the time of the application of any of
the provisions of this Article 6 relating to the rights and obligations of Depository, then such rights
and obligations shall be exercised by, and charged to, Lessor, and the provisions contained in this
Article 6 related thereto shall be deemed modified accordingly.
CONDEMNATION
Section 7.1. For the purposes hereof the following terms shall have the following
meanings:
(a) “Taking” means a taking of the Premises or any part thereof occurring during the
Term for any public or quasi-public purpose by any lawful power or authority, acting in its
sovereign capacity, by the exercise of the right of condemnation or eminent domain or by
agreement among Lessor, Lessee, and those authorized to exercise such right, irrespective of
whether the same affects the whole or Substantially All of the Premises or a lesser portion thereof,
but shall not include a taking of the fee interest in the Premises or any portion thereof or any
leasehold interest superior to that of Lessee, if, after such taking, Lessee’s rights under this Lease
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are not affected. In no event shall the contemplated modification of the boundary of the Route 9A
Access Parcels as described in Section 2.3(b) hereof be deemed to be a condemnation.
(b) “Substantially All of the Premises” means such portion of the Premises as would
leave remaining, after a Taking, a balance of the Premises that, due either to the area so taken or
the location of the part so taken in relation to the part not so taken, would not readily accommodate
a new or reconstructed facility of a type and size generally similar to the Improvements as existing
on the Date of Taking and capable of producing a fair and reasonable net annual income or capable
of supporting substantially similar activities as the Premises in the condition thereof immediately
prior to the Date of Taking, due either to the area so taken or the location of the part so taken in
relation to the part not so taken in light of economic conditions, zoning laws, physical constraints,
or building regulations then existing or prevailing and after performance and/or observance by
Lessee of all covenants, agreements, terms and conditions contained herein or by applicable
Requirements required to be performed or observed by Lessee or which would result in Lessee no
longer having access to the Premises.
(c) “Date of Taking” means the date on which, following a Taking, title to the whole
or Substantially All of the Premises or a lesser portion thereof, as the case may be, shall have
vested in any lawful power or authority pursuant to the provisions of applicable federal, state, or
local condemnation law or the date on which the right to the temporary use of the same has so
vested in any lawful power or authority as aforesaid.
(d) “Condemnation Restoration” means a Restoration of any portion of the Premises
remaining after a Partial Taking and/or a Restoration of any portion of the Premises which has
been changed or altered as a result of a Temporary Taking, so that such portion shall contain
complete structures, in good condition and repair, consisting of self-contained architectural units,
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and to the extent practicable, to a size and condition of, and having a quality substantially similar
to, the size, condition and quality of the Premises existing immediately prior to the Date of Taking.
(e) “Temporary Taking” shall mean a Taking that involves the temporary use of the
whole or Substantially All of the Premises or a lesser portion thereof for a period not extending
beyond the Term.
(f) “Partial Taking” shall mean a Taking other than a Taking of Substantially All of
the Premises or a Temporary Taking.
Section 7.2. If during the Term there shall be a Taking of the whole or Substantially All
of the Premises (other than a Temporary Taking), the following shall apply:
(a) this Lease and the Term shall terminate and expire on the Date of Taking and the
Rental payable by Lessee hereunder shall be equitably apportioned and paid as of the Date of
Taking. The Lessor shall have no obligation to provide relocation benefits to Lessee.
(b) the award or damages in respect thereof shall be apportioned, as available, as
follows:
(i) first, to Lessor the net present value of reversionary interest of Lessor at the
end of the Term (which shall include the Renewal Term whether or not Lessee’s option to exercise
its right to the Renewal Term has then been exercised by Lessee) including but not limited to the
value of the Land discounted to the Date of Taking using a discount rate which is the prevailing
interest rate then payable on the most recent issuance of the City’s general obligation bonds having
a maturity date closest to the end of the Renewal Term (whether or not Lessee’s option to exercise
its right to the Renewal Term has then been exercised by Lessee) (the “Applicable Discount Rate”);
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(ii) second, to the Mortgagee which holds a first lien on Lessee’s interest in this
Lease so much of the balance of such award as shall equal the unpaid principal indebtedness
secured by such Mortgagee, with unpaid interest thereon at the rate specified therein to the date of
payment;
(iii) third, to Lessor the net present value of all Rental, including but not limited
to PILOT and Percentage Rent (which value shall be based on the actual amounts to the extent
then known or reasonable estimates thereof if such actual amounts are not then known to the extent
awarded, collectively, the “Lessor Amounts“) due through the balance of the Term (which shall
include the Renewal Term whether or not Lessee’s option to exercise its right to the Renewal Term
has then been exercised by Lessee), with each such payment of Lessor Amounts discounted to the
Date of Taking using the Applicable Discount Rate;
(iv) fourth, subject to the rights of any Mortgagees, to Lessee with Lessee’s
interest measured by the net present value of the estimate of Lessee’s cash flow from all Gross
Revenue to Lessee at the Premises from Lessee’s operation of the Premises for the remainder of
the Term (which shall include the Renewal Term whether or not Lessee’s option to exercise its
right to the Renewal Term has then been exercised by Lessee) after deducting from such Gross
Revenue the payment of all operating expenses, Lessor Amounts, debt service and other expenses
reasonably estimated to be payable by Lessee from Gross Revenue during the Term (which shall
include the Renewal Term whether or not Lessee’s option to exercise its right to the Renewal Term
has then been exercised by Lessee) discounted to the Date of Taking using the then industry
standard discount rate for such valuations; and
(v) fifth, the balance to be shared equally between Lessor and Lessee.
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In addition, Lessee and any Occupants may file separate claims for their respective interests
in their Trade Fixtures and their moving and relocation costs to the extent such claim does not
diminish the award payable to Lessor as set forth in Section 7.9.
(c) Each of the parties shall execute all documents that may be reasonably required in
order to facilitate collection by them of such awards.
(d) Lessor and Lessee acknowledge and agree that their respective claims filed in
connection with such Taking (i) shall not abridge the other’s rights to any award in connection
with such Taking and (ii) are subject to the rights of the State under the State Lease.
Section 7.3. If less than Substantially All of the Premises is so taken, this Lease shall
terminate in respect of the portion of the Premises taken and the Lease and the Term shall continue
as to the portion of the Premises remaining, except that Lessee’s obligations to pay the Fixed Base
Rent hereunder shall be reduced in proportion to the percentage of the Premises which is so taken
and the PILOT shall be reduced in proportion to the extent that Real Estate Taxes would otherwise
be reduced by reason of such Taking. Lessee shall, after settlement of the award, proceed with
diligence to effect a Condemnation Restoration of the remaining portion of the Premises not so
taken. In the event of any taking pursuant to this Section 7.3, the entire award shall be paid to
Depository and applied first to effect a Condemnation Restoration of the remaining portion of the
Premises not so taken, and thereafter as provided in Section 7.5(a) hereof except that if such
balance is less than Two Million Dollars ($2,000,000), such balance shall be payable directly to
Lessee for application to the cost of Restoration of the part of the Improvements not so taken.
Subject to the provisions and limitations in this Article 7, Depository shall make available to
Lessee as much of that portion of the award actually received and held by Depository, if any, less
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all necessary and proper expenses paid or incurred by Depository as may be necessary to pay the
cost of Restoration of the part of the Improvements remaining. Except as otherwise expressly
provided in this Article 7, such Restoration shall be done in accordance with and subject to the
provisions of Article 6. Payments to Lessee as aforesaid shall be disbursed in the manner and
subject to the conditions set forth in Article 6. Each of the parties shall execute all documents that
may be reasonably required in order to facilitate collection by them of such awards.
Section 7.4. Intentionally Omitted.
Section 7.5. If the temporary use of the whole or any part of the Premises is taken for
any public or quasi-public purpose by any lawful power or authority by the exercise of the right of
condemnation or eminent domain or by agreement between Lessee and those authorized to
exercise such right, Lessee shall give prompt notice thereof to Lessor and the Term shall not be
reduced or affected in any way and Lessee shall continue to pay the Rental payable by Lessee
hereunder subject, however, to a proportionate reduction in the Fixed Base Rent, and any award
payment for such use shall be paid and applied as follows:
(a) if such Taking results in changes or alterations in any of the Improvements that
would necessitate an expenditure to effect a Condemnation Restoration, then a portion of such
award or payment required to cover the expenses of the Condemnation Restoration shall be
retained by Depository out of the first proceeds of any award or payment in connection with such
Taking, and applied and paid over toward the Condemnation Restoration, substantially in the same
manner and subject to the same conditions as provided in Section 7.3; and
(b) if the Taking is for a period extending beyond the Term, the balance of such award
or payment remaining after application as provided in Section 7.5(a) shall be apportioned between
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Lessor and Lessee as of the Expiration Date (calculated using the assumption that this Lease will
be extended for the Renewal Term set forth in Section 2.5), and Lessee’s share thereof, (i) if paid
less frequently than in monthly installments shall be paid to Depository and applied to the payment
of Rental, and (ii) if paid monthly or more frequently, shall be paid to Lessee.
Section 7.6. In case of any governmental action not resulting in the taking or
condemnation of any portion of the Premises but creating a right to compensation therefor, such
as the changing of the grade of any street upon which the Premises abut, this Lease shall continue
in full force and effect without reduction or abatement of Rental. Any award payable thereunder
shall be applied first to reimburse Lessee for any construction work performed by Lessee resulting
from such governmental action and any balance shall be paid to Lessor.
Section 7.7. In the event of a negotiated sale of all or a portion of the Premises in lieu of
condemnation, the proceeds shall be distributed as provided in cases of condemnation.
Section 7.8. Lessor, Lessee and each Mortgagee shall be entitled to file a claim and
otherwise participate in any condemnation or similar proceeding and all hearings, trials and
appeals in respect thereof at their own expense.
Section 7.9. Notwithstanding anything to the contrary contained in this Article 7, to the
extent that no award is allocated under Section 7.2(b), Lessee and its Occupants shall have the
exclusive right to assert claims for any Trade Fixtures and personal property so taken which were
the property of Lessee or its Occupants (but not including any Equipment) and for moving and
relocation expenses of Lessee or its Occupants as provided by law, and all awards and damages
in respect thereof shall belong to Lessee and its Occupants, and Lessor hereby waives all claims
to any part thereof; provided, however, that if there is no separate award or allocation for such
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Trade Fixtures or personal property, then such claims of Lessee and its Occupants shall be
equitably apportioned from the award received.
Section 7.10. The existence of any present or future law or statute notwithstanding, except
as otherwise provided herein and to the extent permitted by applicable Requirements, Lessee
waives all rights to quit or surrender the Premises or any part thereof by reason of any Taking of
less than Substantially All of the Premises. It is the intention of Lessor and Lessee that the
provisions of this Article 7 shall constitute an “express agreement to the contrary” as provided in
Section 227 of the Real Property Law of the State of New York and shall govern and control in
lieu thereof.
Section 7.11. Intentionally Omitted.
Section 7.12. In the event there is no Depository at the time of the application of any of
the provisions of this Article 7 relating to the rights and obligations of Depository, then such rights
and obligations shall be exercised by, and charged to, Lessor, and the provisions contained in this
Article 7 related thereto shall be deemed modified accordingly.
ASSIGNMENT, SUBLETTING, MORTGAGES, ETC.
Section 8.1. (a) Except as expressly provided in this Article 8:
(i) No direct interest of Lessee in this Lease shall be sold, assigned, or
otherwise transferred, pledged or encumbered (other than to a Mortgagee in accordance with the
provisions of this Article 8), whether by operation of law or otherwise, without the consent of
Lessor, provided however, that Lessor’s consent shall not be required for any sale or assignment
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of less than ten percent (10%) of the direct ownership in Lessee of this Lease that does not also
result in a Change of Control of Lessee;
(ii) No issued or outstanding capital stock of any corporation which is
Lessee or a general partner of Lessee or which, directly or indirectly, Controls Lessee or a general
partner of Lessee shall be (voluntarily or involuntarily) sold, assigned, transferred, pledged or
encumbered (other than to a Mortgagee in accordance with the provisions of this Article 8), whether
by operation of law or otherwise if any such sale, assignment, transfer, pledge or encumbrance
will result in a Change of Control of Lessee without the consent of Lessor, whether such transfers
occur in a single transaction or a series of related or unrelated transactions;
(iii) No voting trust or similar agreement shall be entered into with
respect to the stock referred to in Section 8.1(a)(ii), nor any reclassification or modification of the
terms of such stock take place, nor shall there be any merger or consolidation of such corporation
into or with another corporation, nor shall additional stock (or any warrants, options or debt
securities convertible, directly or indirectly, into such stock) in any such corporation be issued if
any such sale, assignment, transfer, pledge or encumbrance, agreement, reclassification, merger,
consolidation or issuance will result in a Change of Control, nor shall any general partner’s interest
in a partnership which is Lessee or, directly or indirectly, a general partner of Lessee be
(voluntarily or involuntarily) sold, assigned or transferred, nor shall any membership interests in a
limited liability company which is Lessee, or directly or indirectly, a Controlling or managing
member of Lessee be (voluntarily or involuntarily) sold, assigned or transferred, nor any other
transfer of beneficial Controlling ownership, directly or indirectly (whether voluntarily or
involuntarily) in Lessee be (voluntarily or involuntarily) sold, assigned or transferred, if in any
such case such sale, assignment or transfer will result in a Change of Control of such partnership
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or limited liability company, and, in all such cases whether such transfers occur in a single
transaction or a series of related or unrelated transactions without the consent of Lessor. Each of
the foregoing transactions described in this Section 8.1(a)(iii), together with those described in
Section 8.1(a)(i), Section 8.1(a)(ii), and Section 8.1(a)(iv)(B) shall be referred to herein as a
“Transfer”.
(iv) (A) Trading of publicly-traded equity interests in a Person that occur as a
result of a merger, consolidation or tender offer that results in a Change of Control of Lessee and
transfers of publicly traded-equity interests in a Person that occur as a result of a merger,
consolidation or tender offer that results in a Change of Control of Lessee (x) where the Person
that is the survivor or acquirer is a publicly traded entity that has a market capitalization of $5
billion or more and GAAP Stockholders’ Equity of no less than $2 billion both as of the date of
and immediately following such merger, consolidation or tender offer, or (y) which is Third Party-
Initiated where the Person that is the survivor or acquirer is a publicly traded entity that has a
market capitalization of less than $5 billion or GAAP Stockholders’ Equity of less than $2 billion
as of the date of or immediately following such merger, consolidation or tender offer, shall in
neither case be deemed to constitute a Transfer and shall not be subject to the consent of Lessor
(but shall be subject to Lessor’s review procedures set forth in Section 8.1(a)(iv)(C)) but shall in
each case be deemed a Transaction for purposes of the payment of Transaction Rent, as may be
applicable in accordance with the provisions of Section 3.4 and, as applicable, Section
8.1(a)(iv)(C).
(B) Trading of publicly-traded equity interests in a Person as a result of a
merger, consolidation, or tender offer and transfers that occur as a result of a merger, consolidation,
or tender offer (x) where the merger, consolidation or tender offer is not a Third Party-Initiated
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Transaction, and (y) where the Person that is the survivor or acquirer is a publicly traded entity
that has a market capitalization of less than $5 billion or GAAP Stockholders’ Equity of less than
$2 billion as of the date of or immediately following such merger, consolidation or tender offer,
and (z) that in and of itself results in a Change of Control of Lessee shall constitute a Transfer and
shall be subject to the consent of Lessor.
(C) Lessee shall notify Lessor of the completion of any transaction
described in clause (A) of this Section 8.1(a)(iv) as soon as possible but in no event later than thirty
(30) days after the closing of such transaction and, if the result of such transaction is that Lessee
becomes a Person that does not materially meet the criteria set forth in subclauses (w), (x), (y) and
(z) in clause (1) of Section 8.1(b)(iii), Lessee shall seek a waiver from Lessor of the nonconforming
criteria and Lessor’s consent to continue to Control the Premises (the “Waiver Request”), and if
Lessor does not grant such consent within sixty (60) days of the Waiver Request, then Lessee shall
sell or assign its interest in the Premises pursuant to the requirements of this Article 8 within one
(1) year from the date that Lessor notifies Lessee of its denial of the Waiver Request. If Lessee
sells or assigns its interest in the Premises as a result of Lessor’s refusal to consent to Lessee’s
Waiver Request, the amount of any Transaction Rent paid in connection with the Transaction for
which the Waiver Request was made shall be credited against the Transaction Rent due and
payable in connection with Lessee’s sale or assignment in accordance with the provisions of the
immediately preceding sentence, and if the credit to which Lessee is entitled exceeds the amount
of Transaction Rent due and payable in connection with such sale, Lessor shall pay such excess to
Lessee within thirty (30) days of the closing of such Transaction.
(D) Trading of publicly-traded equity interests in a Person that does not
occur as a result of a merger, consolidation, or tender offer shall not constitute a Transfer and shall
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not be subject to the consent of Lessor, even if such trading results in a Change of Control, and
shall not be deemed a Transaction for purposes of the payment of Transaction Rent.
(v) Lessee shall not enter into a Major Sublease, or, if Lessee is the
successor to a Transfer of the sort described in Section 3.4(b)(i)(A)(2), permit the sublessee of
such Major Sublease to Transfer its interest in such Major Sublease without first obtaining Lessor’s
consent. A Major Sublease shall constitute a Transaction with Transaction Rent payable as may
be applicable in accordance with the provisions of Section 3.4.
(vi) Any Sublease to a Person that is not an Affiliate of Lessee in excess
of 15% but less than 50% of the Usable Square Footage of the Premises is subject to Lessor’s
determination in accordance with the provisions of Section 8.1(e) that the proposed sublessee is
not a Prohibited Person.
(vii) For purposes set forth herein, “beneficial ownership” or “beneficial
interest” shall mean the right to enjoy any of the benefits of ownership, economic or otherwise, of
an equity interest in Lessee. Beneficial ownership shall be pro-rated to reflect partial ownership
interests (for example, beneficial ownership of a 75% interest in an entity possessing beneficial
ownership of a 40% interest in either of the individually named Lessees shall be deemed to be
beneficial ownership of a 30% interest in such Lessee).
(b) Notwithstanding anything contained in Section 8.1(a) to the contrary:
(i) Lessee shall have the right without the consent of Lessor, to
encumber its leasehold in the Premises with a Mortgage and related security documents to an
Institutional Lender, provided that at the time the Mortgage and related security documents are
executed the Institutional Lender and each Vendex Required Responder shall submit to Lessor a
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Vendex Questionnaire evidencing that the Institutional Lender is not a Prohibited Person. Nothing
in this subparagraph (b)(i) shall prevent Lessor from conducting additional due diligence to
confirm the Institutional Lender is not a Prohibited Person. Lessor acknowledges and confirms
for the benefit of VICI Lendco LLC that (A) Lessor granted such consent as was required under
the Original Lease for VICI Lendco LLC to be deemed to be an Institutional Lender and a
Mortgagee and not a Prohibited Person for purposes of the Original Lease, (B) Lessor entered into
a Lessor’s Consent and Estoppel, dated as of August 31, 2020, for the benefit of VICI Lendco
LLC, (C) the consents granted by Lessor with respect to VICI Lendco LLC as an Institutional
Lender and a Mortgagee and not a Prohibited Person for purposes of the Original Lease shall apply
to this Lease as if such consents were granted under and pursuant to this Lease as of the
Commencement Date; and (D) Lessor reaffirms the provisions of Lessor’s Consent and Estoppel,
dated as of August 31, 2020, for the benefit of VICI Lendco LLC as of the Commencement Date
as if all references to the “Lease” in such Lessor’s Consent and Estoppel referred to this Lease.
(ii) Lessee shall have the right at any time and from time to time to
sublet any portion of the Premises without the consent of Lessor, provided that any such sublet
does not exceed fifteen percent (15%) of the Usable Square Footage of the Premises, Occupant’s
use is in accordance with the uses permitted under Article 21, and neither Occupant nor its
proposed use violates any other provision of this Lease. In the case that the sublet is to an Affiliate
of Lessee the results of which are consolidated with the results of Lessee under GAAP, Lessee
shall provide Lessor thirty (30) days’ prior written notice prior to entering into an agreement for
the proposed sublet. Providing that any resulting Sublease does not constitute a Major Sublease,
Lessee shall have the right, at any time and from time to time, without Lessor’s consent, to
(1) allow any Person to occupy, use, operate and manage Production Facilities in the Premises in
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accordance with Section 21.1(b), and (2) allow patrons and employees to use the Premises for
parking purposes.
(iii) Lessor agrees that it shall not unreasonably withhold its consent, to
the extent that such consent is required, to any Transfer or Major Sublease to (I) any Person that
is Controlled by the holders of a Controlling Interest in the equity of Lessee, (II) any Person that
is Controlled by the owners of the equity of Lessee that Control Lessee, or (III) any Person that is
proposed to Control Lessee or be Subtenant under a Major Sublease that (1) possesses (w)
sufficient financial ability to perform all of the covenants and conditions of this Lease (or, as the
case may be, the Major Sublease), (x) a business reputation for good faith and fair dealing
reasonably satisfactory to Lessor, (y) executive or senior management who has, or a contractual
arrangement with a management organization that has, in Lessor’s reasonable judgment, sufficient
experience operating a business of the same kind and character as that carried on by Lessee at the
Premises, and (z) executive or senior management who, either by themselves, or, if applicable,
together with a management organization so qualified under the preceding clause (y) of this
Section 8.1(b)(iii) are, upon reasonable notice, available to Lessor to consult on matters
concerning administration of this Lease (or, as the case may be, the Major Sublease) on either an
in-person or remote electronic basis and either (XX) direct its employees (or the employees of an
affiliate or subsidiary under its direct or indirect control) to manage and operate the Premises (or,
as the case may be, that portion of the Premises under the Major Sublease), or (YY) direct a
contract management organization so qualified under the preceding clause (y) of this Section
8.1(b)(iii) to manage and operate the Premises (or, as the case may be, that portion of the Premises
under the Major Sublease), and (2) at the time of the Transfer or Major Sublease such Person and
each Vendex Required Responder has submitted to Lessor a Vendex Questionnaire evidencing
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that the Person is not a Prohibited Person. Lessor further agrees that its consent shall not be
required in the case of (X) the financing or the refinancing of any Mortgage with an Institutional
Lender, provided, however, at the time of the Mortgage the Mortgagee and each Vendex Required
Responder shall submit to Lessor a Vendex Questionnaire evidencing that the Mortgagee is not a
Prohibited Person, or (Y) a transfer of shares of stock or other equity interests in a general partner
of Lessee, provided that Lessee gives notice to Lessor of such transfer and confirms that such
transfer is for the purpose of implementing appropriate succession arrangements for the
stockholders or other equity owners of the general partner of Lessee and at the time of the transfer
the transferee and each Vendex Required Responder submits to Lessor a Vendex Questionnaire
evidencing that the transferee is not a Prohibited Person. Nothing herein shall prevent Lessor from
conducting additional due diligence to determine if any such Person under clauses (X) or (Y) of
this Section 8.1(b)(iii) is a Prohibited Person. Where Lessor’s consent is not to be unreasonably
withheld based upon the ownership criteria set forth in this Section 8.1(b)(iii)(I) and (II), failure to
satisfy such ownership criteria shall, in and of itself, be a reasonable ground on which the Lessor
may withhold its consent to any proposed Transfer or other transaction. Those transactions
described in clauses (X) or (Y) of this Section 8.1(b)(iii) shall not constitute Transfers and shall
not be subject to the payment of Transaction Rent.
(iv) Within thirty (30) days after the later of (1) Lessor’s receipt of notice
from Lessee requesting Lessor’s consent to a Transfer or Major Sublease, or (2) Lessor’s receipt
of such information in connection therewith reasonably requested by Lessor, Lessor shall give
notice to Lessee of its decision to grant or withhold its consent and if the consent is withheld, shall
state the reasons for such action. Any dispute with respect to the application of the standards or
compliance with the terms of Section 8.1(b)(iii)(I) and (II) shall be resolved by expedited
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arbitration in accordance with the provisions of Section 32.4. If, within forty-five (45) days after
the latest date that Lessee gives notice to Lessor of its request for the consent of Lessor to a Transfer
or Major Sublease described in section 8.1(b)(iii) and Lessee has submitted to Lessor such
information in connection therewith reasonably requested by Lessor, Lessor shall fail to notify
Lessee of its decision to grant or withhold its consent and if the consent is withheld, shall fail to
state the reasons for such action, Lessee shall send Lessor a second notice and, if Lessor fails to
respond within ten (10) Business Days of receipt of the second notice, Lessor shall be deemed to
have granted its consent pursuant to this Section 8.1, subject to the further determination under
Section 8.1(e). Lessee’s second notice shall contain the following legend on the top of the notice:
“FAILURE TO RESPOND TO THIS NOTICE WITHIN TEN BUSINESS DAYS OF RECEIPT
WILL RESULT IN LESSOR’S CONSENT BEING DEEMED TO HAVE BEEN GRANTED”.
(c) Lessee shall deliver to Lessor any documents and information Lessor may
reasonably request in connection with each Transfer or each subletting of greater than 15% of
Usable Square Footage, including such documentation and information as may be reasonably
needed to determine if Lessor’s consent is required under Section 8.1(a). Lessor acknowledges
that any requirement that any Person submit to Lessor a Vendex Questionnaire shall not require
such Person to complete the Vendex process then applied by New York City or New York State.
(d) To the extent of any assignment of this Lease or Lessee’s interest in the Premises
permitted pursuant to this Article 8, the assignor shall be relieved of any and all obligations and
liabilities to Lessor with respect to the assigned interest that arises after the assignment other than
with respect to any indemnification obligation under this Lease with respect to third party claims
that arise or accrue prior to the date of assignment, but are not asserted until after the date of such
assignment, provided that all such obligations have been assumed by the assignee.
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(e) In no event shall Lessee make a Transfer or Major Sublease that requires the
consent of Lessor under this Section 8.1, or Sublease in excess of 15% but less than 50% of the
Usable Square Footage of the Premises, or enter into a transaction described in Section
8.1(b)(iii)(X) or (Y) or 8.1(a)(iv)(A), unless at the time of such Transfer, Major Sublease,
Sublease, or transaction (or at such other time as set forth herein) such transferee, Sublessee or
purchaser represents and warrants to Lessor that each Vendex Required Responder is not a
Prohibited Person as evidenced in part by completing a Vendex Questionnaire. No Transfer by
Lessee, Major Sublease by Lessee, Sublease by Lessee of in excess of 15% but less than 50% of
the Usable Square Footage of the Premises, or transaction described in Section 8.1(b)(iii)(X) or
(Y) shall be permitted unless Lessee shall notify Lessor in writing of the proposed Transfer, Major
Sublease, subletting or transaction and the parties to such Transfer, Major Sublease, subletting or
transaction. Within thirty (30) days after the later of (x) Lessor’s receipt of such notice or
(y) Lessor’s receipt of such information as is reasonably required in order for Lessor to determine
whether the applicable Person or any Vendex Required Responder is a Prohibited Person, Lessor
shall determine whether each such Person is unacceptable to Lessor because such Person is a
Prohibited Person, and shall notify Lessee of any such finding of unacceptability. Upon receipt of
such a notice of unacceptability, Lessee shall have thirty (30) days in which to submit evidence to
Lessor rebutting Lessor’s conclusion of unacceptability, and Lessor shall notify Lessee within
thirty (30) days of the receipt of any such rebuttal evidence whether or not such rebuttal evidence
has resulted in any change in Lessor’s conclusion of unacceptability. If Lessor shall fail to notify
Lessee within forty-five (45) days of the later of the dates set forth in (x) or (y) above, that a Person
is unacceptable because such Person is a Prohibited Person, Lessee shall send Lessor a second
notice and, if Lessor fails to respond within ten (10) Business Days of receipt of the second notice,
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Lessor shall be deemed to have waived any objections to such Person on account of any
information about such Person submitted to Lessor pursuant to clause (y) above. Lessee’s second
notice shall contain the following legend on top of the notice: “FAILURE TO RESPOND TO
THIS NOTICE WITHIN TEN BUSINESS DAYS OF RECEIPT WILL RESULT IN LESSOR
BEING DEEMED TO HAVE WAIVED OBJECTIONS”.
(f) Subject to compliance by a Mortgagee with the provisions of Sections 8.6 and 8.7,
the foregoing requirement of consent by Lessor shall not apply to the acquisition of Lessee’s
interest in the Premises by such Mortgagee, through the foreclosure of its Mortgage, or through a
deed or instrument of transfer delivered in lieu of such foreclosure or to a purchaser (“Purchaser
at Foreclosure”) of the Lessee’s interest in the Premises following such a foreclosure or delivery
of a deed or instrument of transfer in lieu of such foreclosure so long as, in the instrument
transferring to such Mortgagee or Purchaser at Foreclosure the interest of Lessee hereunder, such
Mortgagee or Purchaser at Foreclosure assumes and agrees to perform all of the terms, covenants
and conditions of this Lease thereafter to be observed or performed by Lessee and, (x) in the case
of a Mortgagee described in clause (h) or (j) of the definition of Institutional Lender (or a
subsidiary thereof as described in clause (i) of such definition) that directly operates the businesses
operated by Lessee at the Premises for more than 365 days after completion of the foreclosure
proceedings, such Mortgagee has executive management who have, or a contractual arrangement
with a management organization that has, in Lessor’s reasonable judgment, experience in
operating a business for at least a ten-year period of the same kind and character as that carried on
by Lessee at all or a portion of the Premises or (y) in the case of a Purchaser at Foreclosure, such
Purchaser at Foreclosure satisfies the standards applicable to a Transfer that involves a Change of
Control of Lessee, except that in no event may Lessee’s interest in this Lease be acquired by a
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Mortgagee or a Purchaser at Foreclosure unless at the time of such acquisition the Mortgagee or
Purchaser at Foreclosure represents and warrants to Lessor that the transferee and each other
Vendex Required Responder is not a Prohibited Person (as evidenced in part by the completion of
the Vendex Questionnaire). Each reference in this Section 8.1(f) to “Mortgagee” shall be deemed
to include a wholly owned subsidiary (direct or indirect) of such Mortgagee or its direct parent,
provided such Mortgagee has delivered to Lessor a written notice advising that such a subsidiary
should be so deemed and certifying (i) such subsidiary is wholly owned (directly or indirectly) by
such Mortgagee or its direct parent and (ii) that such subsidiary is authorized to act in the place
and stead of such Mortgagee.
(g) Lessee shall not, without the prior consent of Lessor, which consent may be
withheld in Lessor’s sole discretion, submit Lessee’s leasehold estate in the Premises, or any part
thereof, to a condominium form of ownership in accordance with the provisions of Article 9-B of
the Real Property Law of the State of New York, as it may be amended.
(h) Lessor may, upon reasonable prior written notice to Lessee, transfer or assign its
interest in the Premises or its interest under this Lease, in whole or in part, to any Person or to the
City, State or other Governmental Authority, at any time, in Lessor’s sole and absolute discretion,
provided that such transfer or assignment shall be subject to the conditions of this Lease. In the
event that Lessor or any successor to Lessor’s interest hereunder transfers or assigns its interest in
the Premises or its interest under this Lease, then, from and after the date of such assignment or
transfer, the term Lessor means the assignee or transferee and the assignor or transferor shall be,
and hereby is, entirely freed and relieved of all agreements, covenants and obligations of Lessor
hereunder to be performed on or after the date of such transfer or assignment, provided that the
transferee or assignee under such transfer or assignment has, in a written instrument that is
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expressly for the benefit of and enforceable by Lessee (a copy of which shall be provided to Lessee
prior to the effective date of the transfer), assumed and agreed to carry out any and all agreements,
covenants and obligations of Lessor hereunder regardless of whether such agreements, covenants
and obligations arise or accrue before or after the date of such assignment or transfer.
Section 8.2. (a) No assignment of this Lease, subletting of the Premises or Transfer,
shall have any validity except upon compliance with the provisions of Article 8. Any consent by
Lessor under Section 8.1 shall apply only to the specific transaction thereby authorized and shall
not relieve Lessee from any requirement hereunder of obtaining the consent of Lessor to any
further sale or assignment of this Lease or Transfer or subletting of any portion of the Premises.
(b) Lessee shall not enter into any Sublease after the Commencement Date unless such
Sublease provides that:
(i) it is subject and subordinate to this Lease;
(ii) the Sublessees shall not pay rent or other sums under the Subleases more
than one (1) month in advance (excluding security deposits and other deposits required under the
Sublease); and
(iii) with respect to Sublessees other than to Affiliates of Lessee, at Lessor’s
option, on a termination of this Lease pursuant to Article 22 hereto the Sublessee shall attorn to,
or enter into a direct lease on terms identical to the Sublease with Lessor for the balance of the
unexpired term of the Sublease.
Section 8.3. Lessor, after and during the continuation of an Event of Default by Lessee,
may (subject to the rights of any Mortgagee that is an Institutional Lender) collect subrent and all
other sums due under any Subleases, and apply the net amount collected to Rental, but no such
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collection shall be, or be deemed to be, a waiver of any agreement, term, covenant or condition of
this Lease or the acceptance by Lessor of any Sublessee as Lessee hereunder, or a release of Lessee
from performance by Lessee of its obligations under this Lease.
In accordance with the foregoing, Lessor, for the benefit of any Sublessee who is not an
Affiliate of Lessee, whose Sublease was made in accordance with the applicable provisions of this
Article 8 or the corresponding provisions of the Original Lease, shall recognize such Sublessee as
the direct tenant of Lessor upon the termination of this Lease pursuant to the provisions of Article 22
hereof, provided (a) a Mortgagee, if any, has executed a non-disturbance agreement with respect
to the same Sublease; (b) the Sublease confers no greater rights upon Sublessee than are conferred
upon Lessee under this Lease; and (c) at the time of the termination of this Lease (i) no default
exists and is continuing under such Sublease, which at such time would permit the sublessor
thereunder to terminate the Sublease or to exercise any remedy for dispossession provided for
therein, and (ii) such Sublessee delivers to Lessor an instrument confirming the agreement of the
Sublessee to attorn to Lessor and to recognize Lessor as the Sublessee’s sublessor under its
Sublease, which instrument shall provide that neither Lessor, nor anyone claiming by, through or
under Lessor, shall be:
(A) liable for any act or omission of any prior sublessor (including,
without limitation, the then defaulting sublessor),
(B) subject to any offsets or defenses that such Sublessee may then have
against any prior sublessor (including, without limitation, the then defaulting sublessor),
(C) bound by any payment of rent that such Sublessee might have paid
for more than the current month to any prior sublessor (including, without limitation, the
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then defaulting sublessor) or Mortgagee, other than security deposits and any other
amounts deposited with any prior sublessor (including, without limitation, the then
defaulting sublessor) or Mortgagee in connection with the payment of insurance premiums,
Real Property Taxes and assessments and other similar charges or expenses,
(D) bound by any covenant to undertake or complete any construction
at the Premises or any portion thereof demised by the Sublease,
(E) bound by any obligation to make any payment to the Sublessee other
than the return of any security deposit received by Lessor from a prior sublessor, upon the
termination of the Sublease in question for any reason other than the Sublessee’s default,
or
(F) bound by any amendment thereto or modification thereof which
reduces the basic rent, additional rent, supplemental rent or other charges payable under
the Sublease (except to the extent equitably reflecting a reduction in the space covered by
the Sublease), or changes the term thereof, or otherwise materially affects the rights of the
Sublessor thereunder, unless such amendment or modification either (x) did not require the
consent of Lessor hereunder when made or (y) was consented to or deemed consented to
by Lessor.
Within thirty (30) days after request by Lessee, Lessor agrees to deliver to any Sublessee
entitled to the benefit of this Section 8.3 a non-disturbance agreement in recordable form,
confirming the rights and subject to the limitations described herein. Such request by Lessee shall
be accompanied by (i) a duplicate original or photocopy of (A) the Sublease, and (B) the non-
disturbance agreement from the holder of the Mortgage and (ii) execution copies of the non-
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disturbance agreement to be signed by Lessor and Sublessee. The absence or unenforceability of
such non-disturbance agreement for any reason shall not affect the rights of any Sublessee entitled
to the benefits of this Section 8.3.
Section 8.4. To secure the prompt and full payment by Lessee of the Rental and the
faithful performance by Lessee of all the other terms and conditions herein contained on its part to
be kept and performed, Lessee hereby collaterally assigns, transfers and sets over unto Lessor,
subject to any assignment of Subleases and/or rents made in connection with any Mortgage, all of
Lessee’s right, title and interest in and to any and all Subleases and hereby confers upon Lessor,
its agents and representatives, a right of entry in, and sufficient possession of, the Premises to
permit and insure the collection by Lessor of the rentals and other sums payable under the
Subleases. The exercise of the right of entry and qualified possession by Lessor shall not constitute
an eviction of Lessee from the Premises or any portion thereof. Such assignment shall become
operative and effective only if (a) an Event of Default occurs, or (b) this Lease and the Term are
canceled or terminated pursuant to the terms, covenants and conditions hereof, or (c) there occurs
repossession under a dispossess warrant or other re-entry or repossession by Lessor under the
provisions hereof or applicable law, and then only as to such of the Subleases that Lessor has
agreed to take over and assume.
Section 8.5. At any time and from time to time, within fifteen (15) days after Lessor’s
demand, Lessee shall deliver to Lessor a schedule of all Subleases, setting forth, with respect to
each Sublease, the name of the Sublessee, the space occupied, the term, the rent and such other
information as Lessor may reasonably request. Upon the reasonable request of Lessor, Lessee
shall permit Lessor and its agents and representatives to inspect all Subleases and to make copies
thereof, or shall transmit copies of such Subleases to Lessor electronically. If Lessor requests
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printed copies of the Subleases, the first copy of any Sublease shall be at Lessee’s expense;
subsequent copies shall be at Lessor’s expense.
Section 8.6. (a) If Lessee mortgages Lessee’s interest in this Lease to a Mortgagee,
Lessee or such Mortgagee shall give Lessor prompt notice of such Mortgage and furnish Lessor
with a complete and correct copy of each such Mortgage, certified as such by Lessee or such
Mortgagee, together with the name and address of such Mortgagee. After receipt of the foregoing,
Lessor shall give to such Mortgagee, at the address of such Mortgagee set forth in such notice, and
otherwise in the manner provided by Article 23, a copy of each notice of Default at the same time
as, and whenever, any such notice of Default is thereafter given by Lessor to Lessee and no such
notice of Default shall be deemed effective unless and until a copy thereof shall have been so given
to such Mortgagee. Lessor acknowledges that the requirements of Section 8.6(a) of the Original
Lease were satisfied with respect to VICI Lendco LLC as an Institutional Lender and Mortgagee
and the requirements of this Section 8.6(a) shall be deemed to have been satisfied with respect to
VICI Lendco LLC as an Institutional Lender and Mortgagee by the satisfaction of the requirements
of Section 8.6(a) of the Original Lease with respect to VICI Lendco LLC as an Institutional Lender
and Mortgagee.
(b) Subject to the provisions of this Section 8.6 and Section 8.8 hereof, each Mortgagee
shall have a period of (i) fifteen (15) days more, in the case of a Default in the payment of Rental,
and (ii) forty-five (45) days more in the case of any other Default, than is given Lessee under the
provisions of this Lease to, as required hereunder, remedy a Default, cause it to be remedied, or
cause an action to remedy a Default to be commenced, provided such Mortgagee delivers to
Lessor, within ten (10) days after the expiration of the time given to Lessee pursuant to the
provisions of this Lease to remedy (or commence to remedy, if applicable) the event or condition
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which would otherwise constitute an Event of Default hereunder its written agreement to take the
action described within the time periods set forth in clauses (i) or (ii) of this subsection (b).
(c) Subject to the provisions of Section 8.8 hereof, Lessor shall accept performance by
a Mortgagee of any covenant, condition or agreement on Lessee’s part to be performed hereunder
with the same force and effect as though performed by Lessee.
(d) (i) In the case of a Default that is curable without possession of the Premises
by the Mortgagee, no Event of Default (other than Event of Default arising from the non-payment
of Rental) shall be deemed to have occurred if, within the period set forth in Section 8.6(b)(ii)
hereof, a Mortgagee shall have commenced in good faith to cure the Default and is prosecuting
such cure to completion with diligence and continuity, subject to unavoidable delays (which for
purposes of this Section 8.6(d) shall be defined in the same way as “Unavoidable Delays” is
defined in Article I but substituting “Mortgagee” for each occurrence of “Lessee” in such
definition).
(ii) In the case of a Default where possession of the Premises is required in order
to cure the Default or which is a Default that is otherwise not susceptible of being cured by a
Mortgagee, no such Event of Default shall be deemed to have occurred if a Mortgagee has
instituted foreclosure proceedings within sixty (60) days of the day on which a Default would
otherwise become an Event of Default under Article 22 hereof, and is continuously prosecuting
the foreclosure proceedings with diligence and continuity, subject to Unavoidable Delays, to
obtain possession of the Premises and, upon obtaining possession of the Premises, promptly
commences to cure the Default (other than a Default which is not susceptible of being cured by a
Mortgagee) and prosecutes such cure to completion with diligence and continuity, subject to
unavoidable delays, provided that such Mortgagee shall have delivered to Lessor, in writing, its
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agreement to take the actions described in this subsection (ii), and further provided that during the
period in which such action is being taken and/or any foreclosure proceedings are pending, no
Event of Default shall exist by reason of a failure to pay any Rental hereunder. At any time after
the delivery of the aforementioned agreement, such Mortgagee may notify Lessor, in writing, that
it has relinquished possession or, if such proceedings shall have been commenced, that it has
discontinued such proceedings (such notice from a Mortgagee to Lessor shall be referred to
hereinafter as a “Cure Termination Notice”), and, in such event, such Mortgagee shall have no
further liability under such agreement from and after the date on which it delivers a Cure
Termination Notice to the Lessor. Upon the delivery of a Cure Termination Notice, Lessor shall
have the right to terminate this Lease and to take any other action it deems appropriate by reason
of any Event of Default by Lessee, unless Lessee shall have cured the Event of Default prior to
Lessor’s delivery to Lessee of notice of the termination of the Term, and upon any such
termination, the provisions of Section 8.7 hereof shall apply.
(e) Except as expressly provided in Section 8.6(b), no Mortgagee shall become liable
under the provisions of this Lease unless and until such time as it becomes the owner of the
leasehold estate created hereby.
(f) From and after the date upon which Lessor receives the notice and documents
mentioned in Section 8.6(a), Lessor shall not accept a voluntary surrender of or cancel or otherwise
modify or terminate this Lease other than as provided herein without the prior consent of the
Mortgagees who have given such notice.
Section 8.7. (a) In the case of the termination of this Lease by reason of any Event
of Default or any other reason other than expiration on schedule, Lessor shall give prompt notice
thereof to each Mortgagee whose name and address Lessor has received pursuant to notice made
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in compliance with the provisions of Section 8.6(a), at the address of such Mortgagee set forth in
such notice, and otherwise in the manner provided by Article 23. Subject to Section 8.8, Lessor,
on written request of the Mortgagee whose Mortgage is most senior in lien priority made within
thirty (30) days after the giving of such notice by Lessor, shall promptly execute and deliver a new
lease of the Premises to such Mortgagee for the remainder of the Term upon all the covenants,
conditions, limitations and agreements herein contained, and containing a grant of the same
easements as are granted by Lessor pursuant to Section 2.3(a) subject to the agreement of such
Mortgagee to the effect provided in Section 2.3(b), provided that such Mortgagee or its nominee
or designee (i) shall pay to Lessor, simultaneously with the delivery of such new lease, all unpaid
Rental due under this Lease up to and including the date of the commencement of the term of such
new lease and all expenses, including, without limitation, reasonable attorney’s fees and
disbursements and court costs, incurred by Lessor in connection with the Default by Lessee, the
termination of this Lease and the preparation of the new lease, and (ii) shall diligently prosecute
the cure of all Defaults existing under this Lease that are susceptible of being cured by such
Mortgagee.
(b) Any such new lease and the leasehold estate thereby created shall, subject to the
same conditions contained in this Lease, continue to maintain the same priority as this Lease with
regard to any Mortgage, including any fee mortgage, on the Premises or any part thereof or any
other lien, charge or encumbrance thereon. Concurrently with the execution and delivery of such
new lease, Lessor shall assign to the Lessee named therein all of its right, title and interest in and
to moneys (including insurance and condemnation proceeds, and any rents collected from any
Sublessees other than rents previously collected during any period when Lessor is entitled to
collect rent directly from Sublessees), if any, then held by or payable to Lessor or Depository that
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Lessee would have been entitled to receive but for termination of this Lease, and any sums then
held by or payable to Depository shall be deemed to be held by or payable to it as Depository under
the new lease; such assignment however, to be subject to the rights granted to Lessor with respect
to such moneys if a Default shall have occurred and shall not have been remedied as herein
provided.
(c) Upon the execution and delivery of a new lease under this Section 8.7, all Subleases
that theretofore had been assigned to, or made by, Lessor shall be assigned and transferred, without
recourse, by Lessor to the lessee named in such new lease.
Section 8.8. If more than one Mortgagee has exercised any of the rights afforded by
Sections 8.6 or 8.7 hereof, only that Mortgagee, to the exclusion of all other Mortgagees, whose
Mortgage is most senior in lien shall be recognized by Lessor as having exercised such right, for
so long as such Mortgagee shall be diligently exercising its rights under this Lease with respect
thereto, and thereafter only the Mortgagee whose Mortgage is next most senior in lien shall be
recognized by Lessor, unless, in either case, such Mortgagee has designated a Mortgagee whose
Mortgage is junior in lien to exercise such right. If the parties cannot agree on which Mortgage is
most senior in lien, such dispute shall be determined by a then current certificate of title obtained
by Lessor or Lessee, at Lessee’s sole expense, issued by a title insurance company licensed to do
business in the State of New York and selected by Lessor, and such determination shall bind the
parties.
Section 8.9. Lessor shall have the right to mortgage its superior leasehold or other
interest in the Premises, as long as such mortgage is subject to this Lease and any new lease
executed pursuant to the provisions of Section 8.7 and provided that such mortgage does not
adversely affect Lessee’s leasehold or leasehold mortgage interest in and to the Premises or affect
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any of Lessee’s rights or increase any of Lessee’s obligations under this Lease, except to a de
minimis extent. Anything in this Lease to the contrary notwithstanding, Lessor covenants and
agrees that neither Lessee’s interest in this Lease, nor Lessee’s interest in any sublease nor any
Institutional Lender’s interest in this Lease or a new lease obtained pursuant to Section 8.7, shall
be subordinate to any mortgage (“Lessor’s Mortgage”) on Lessor’s superior leasehold or other
interest in the Premises. Lessor agrees to include in Lessor’s Mortgage a subordination clause
reasonably satisfactory to Lessee and to the Institutional Lender most senior in lien in order to
accomplish such subordination. Lessor represents that there is currently no mortgage encumbering
Lessor’s interest in the Premises.
Section 8.10. CPLP represents that, in its capacity as lessee under the Original Lease,
CPLP and/or NROC entered into the Subleases with Existing Tenants, as shown in Exhibit D
annexed hereto (the “Existing Subleases”). If, and to the extent that Lessor’s consent would have
been required in order for Lessee to enter into such Sublease, Lessor shall be deemed to have
consented to such Sublease pursuant to this Lease. Each of CPLP and NROC, as applicable,
confirms that it shall remain liable and responsible for all of its respective obligations as lessor
under the applicable Existing Subleases, and CPLP or NROC, as applicable, shall be deemed to
have received all security deposits delivered by the Existing Tenants under the Existing Subleases.
Section 8.11. Lessee represents, warrants, and covenants that (i) Chelsea Piers Management
Inc. is the sole general partner of each of CPLP and NROC, (ii) the limited partners of CPLP and
NROC are substantially identical, (iii) any transfer by Chelsea Piers Management Inc. of its
ownership interest in either CPLP and/or NROC which would cause a Change of Control of NROC
or CPLP shall be deemed to be a Transfer subject to the provisions of this Article 8; and (iv) if
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applicable, both CPLP and NROC will each assign their interest in the Lease at the same time and
to the same party.
PUBLIC ACCESS IMPROVEMENT PLAN; PUBLIC OUTREACH
Section 9.1. (a) As set forth herein, Lessee shall undertake and complete improvements
to the Public Access Areas including the Baseline Public Access Improvements, the concept design
for which is annexed hereto as Appendix A-1, and the Enhanced Public Access Improvements, the
concept design for which is annexed hereto as Appendix A-2 (the Baseline Public Access
Improvements together with the Enhanced Public Access Improvements, the “Public Access
Improvements”). Appendix A-1 and Appendix A-2 supplement the text of this Section 9.1 and
depict agreed-upon details of the Baseline Public Access Improvements and Enhanced Public
Access Improvements. To the extent Appendix A-1 and/or Appendix A-2 differ from the
description in this Section 9.1(a) of the Baseline Public Access Improvements or the Enhanced
Public Access Improvements, the description in this Section 9.1(a) (as applicable) shall govern.
The “Baseline Public Access Improvements” shall mean (i) an expanded pile supported platform
abutting and physically integrated with the existing Pier 59 Walkway (the “Pier 59 Platform
Expansion”) with new boardwalk timber, framing and composite decking and railing similar to
existing perimeter railings at the Premises, wayfinding and park graphics on the south exterior
wall of the Pier 59 Headhouse, and new lighting (the “Pier 59 Walkway Improvements”); (ii) an
enlarged 20-foot-wide entrance portal on the south side of the Pier 59 Headhouse (the “Pier 59
Entrance Improvement”); (iii) a new widened concrete pedestrian sidewalk to provide an easily
identifiable and continuous pedestrian pathway, new lighting, screening of parking stackers, and
park wayfinding and graphic signage extending through the Pier 59 Headhouse from the Pier 59
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Entrance Improvement to the Sunset Strip Interior Walkway and Sunset Strip Exterior Walkway
(the “Pier 59 Interior Improvements”); (iv) relocating seating/benches closer to the railing and/or
removal of furniture to widen usable pedestrian passage space on the Sunset Strip Exterior
Walkway, and installing or applying a surface treatment that provides an easily identifiable and
continuous pedestrian pathway on the Sunset Strip Interior Walkway and Sunset Strip Exterior
Walkway (the “Western Walkway Improvements”); (v) installing a durable and distinctive surface
treatment consistent with the surface color of the Western Walkway Improvements (including
crosswalk safety striping) to provide an easily identifiable and continuous pedestrian pathway
within the interior of the Pier 60 and Pier 61 garages that align with the Sunset Strip Interior
Walkway and Sunset Strip Exterior Walkway (the “Garage Improvements”), (vi) removal of
pedestrian obstructions and modifications to the existing Service Road Sidewalks to improve
pedestrian flow (“the Eastern Sidewalk Improvements”); (vii) installation of wayfinding signage
in accordance with Section 11.9 (in the case of each of (i) through (vii), as depicted in Appendix
A-1), and (viii) such additional improvements to the Public Access Areas not otherwise included
as the Baseline Public Access Improvements that (x) are reasonably required in order to complete
the Baseline Public Access Improvements, or (y) the parties may agree upon in writing, each in its
sole discretion. The “Enhanced Public Access Improvements” shall mean adding to or modifying
the Baseline Public Access Improvement scope as follows: (1) the installation of pavers or other
surface treatments of one or more types similar to those used elsewhere in the Park on walkways
included in the Western Walkway Improvements and Pier 59 Interior Improvements as designated
in Appendix A-2 (the “Walkway Pavement Enhancements”); (2) improvements to the pedestrian
crossings within the interior of the Pier 60 and Pier 61 garages that modifies the surface elevation
of the finished treatment (but not the application of the surface treatment itself) to align with the
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surface elevation of the Walkway Pavement Enhancement (the “Garage Crossing Elevation
Improvements”); and (3) the widening of the exterior entryway abutting the northern portion of
the Pier 62 Headhouse and connecting to the Western Walkway Improvements accomplished by
the removal of structures separating portions of the Sunset Strip Interior Walkway and Sunset Strip
Exterior Walkway (the “Pier 62 Entry Enhancement”), (in the case of each of (1) through (3), as
depicted in Appendix A-2); and (4) such additional improvements to the Public Access Areas not
otherwise included as the Enhanced Public Access Improvements that (x) are reasonably required
in order to complete the Enhanced Public Access Improvements, or (y) the parties may agree upon,
in writing, each in its sole discretion.
(b) Lessee shall be responsible, at Lessee’s sole cost and expense (subject to the Fixed
Base Rent reduction provisions of Section 9.1(l)), for undertaking the Public Access Improvements
including but not limited to preparing all design documents, preparing applications and securing
necessary permits and approvals from Governmental Authorities, issuing bids (or requests for
proposals), obtaining construction contracts, administering the work, and maintaining the agreed-
upon schedule, all in accordance with this Lease and the Requirements. As used herein (i) the “In
Water Work” shall mean the Pier 59 Platform Expansion, (ii) the “In Water Permits” shall mean
permits from Governmental Authorities in connection with the In Water Work, (iii) the “Other
Work” shall mean all components of the Public Access Improvements that are not the In Water
Work, and (iv) the “Other Permits” shall mean permits from Governmental Authorities in
connection with the Other Work.
(c) Lessee shall, within four months after the Execution Date, retain at its sole cost and
expense (subject to the Fixed Base Rent reduction provisions of Section 9.1(i)) a team of
independent, qualified, reputable and experienced design and engineering professionals to prepare
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and issue design documents, permit applications, construction bids and contracts, and provide cost
estimating and construction administration services all in connection with the Public Access
Improvements (the “Design Team”), each of which shall be subject to the approval of Lessor, such
approval not to be unreasonably withheld, conditioned or delayed.
(d) The preparation of designs and securing the approval of Governmental Authorities
for the In Water Work shall proceed as in the following manner:
(i) Lessee shall direct the Design Team to, within three (3) months after the
date the Design Team is retained pursuant to Section 9.1(c), complete a marine survey indicating
site conditions and prepare schematic design plans for the In Water Work at a level of specificity
adequate to satisfy submission requirements of Governmental Authorities for the In Water Permit
applications and thereafter provide such plans to Lessor. Lessor shall review and consult with
Lessee regarding such schematic design plans and provide comments, if any, within sixty (60)
days after receipt from Lessee. Lessee shall thereafter consider Lessor’s comments, if any, and
shall, within sixty (60) days of receipt of comments by Lessor, make such revisions, if any, that
Lessee determines in its reasonable judgement are necessary and appropriate in order for the In
Water Work to proceed in compliance with this Section 9.1 and the Requirements, and thereafter
provide such schematic design plan revisions, if any, to Lessor for Lessor’s approval, not to be
unreasonably withheld, conditioned or delayed (such plans as approved by Lessor, the “Schematic
In Water Designs”). Upon completion of the Schematic In Water Designs, Lessee shall direct the
Design Team to prepare in reasonable detail a preliminary cost estimate for the In Water Work
and, following consultation with Lessor, provide such preliminary cost estimate to Lessor. Such
preliminary cost estimate may be revised from time to time by Lessee following consultation with
Lessor.
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(ii) Within sixty (60) days after the later of (i) completion of the Schematic In
Water Designs, or (ii) the Commencement Date, Lessee shall consult with Lessor and prepare
associated applications required by the applicable Governmental Authorities for the issuance of
the In Water Permits for Lessor review and approval, not to be unreasonably withheld, conditioned
or delayed. Lessor shall thereafter sign such completed applications in such case that Lessor
execution is required with reasonable promptness and Lessee shall, within fifteen (15) days after
receipt of such signed applications from Lessor, submit such completed applications to the
applicable Governmental Authorities. Lessee shall thereafter prosecute such applications
diligently and use commercially reasonable efforts to obtain the In Water Permits from the
applicable Governmental Authorities no later than twelve (12) months following the date of
submission of the applications (the “Outside Approval Date”). Lessee shall advise Lessor of all
relevant and material correspondence with, information requests from, and meetings with, the
applicable Governmental Authorities in connection with the applications, and Lessor shall
cooperate with Lessee and use commercially reasonable efforts to facilitate the granting of the In
Water Permits by stating to the applicable Governmental Authorities that the applications and
proposed Public Access Improvements will advance the public benefit that Lessor is dedicated to
achieving. If, through no fault of Lessee and despite Lessee’s diligent good faith prosecution of
the applications thereof, Lessee is unable to secure approval of the In Water Permits by the Outside
Approval Date, and the applications have not been denied such that the denial is unappealable (and
no revised application may be submitted), then Lessor shall extend the Outside Approval Date by
one or more additional periods of up to three (3) months each until such time as the In Water
Permits are granted (the “Extended Approval Date”). All costs of obtaining the In Water Permits,
including but not limited to application fees, shall be paid solely by Lessee and such costs shall
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not be associated with the Enhanced Public Access Improvements. Any additional costs incurred
due to conditions or mitigation measures required by Governmental Authorities in connection with
the issuance of the In Water Permits shall be paid solely by Lessee.
(iii) In the event that Lessee is unable to obtain the In Water Permits within six
(6) months after the last approved Extended Approval Date set forth in Section 9.1(d)(ii), Lessee
and Lessor shall cooperate and jointly develop an alternative plan (which alternative plan shall be
designated to be as part of the Baseline Public Access Improvements) that, (x) in the sole but
reasonable judgement of Lessor, provides equivalent or similar public benefits to those benefits
provided by the proposed In Water Work not approved by Governmental Authorities, (y) in the
sole but reasonable judgment of Lessee, has approximately the same estimated construction cost
as the proposed In Water Work (as such estimate is revised from time to time) not approved by
Governmental Authorities, and (z) is reasonably likely, in the sole but reasonable judgement of
each of Lessor and Lessee, to be approved by applicable Governmental Authorities within a
reasonable time and at a cost that is reasonable in comparison to the estimated construction cost
and budget for the In Water Work (as such estimate and budget are revised from time to time).
Lessee shall thereafter undertake commercially reasonable efforts in a diligent manner to (x) secure
all approvals and permits necessary to implement such alternative plan from applicable
Governmental Authorities, and (y) promptly upon receipt of such approvals and permits, prosecute
the construction and completion of such alternative plan in accordance with the procedures set
forth in this Section 9.1. Notwithstanding anything to the contrary contained in this Section 9.1,
should Lessor and Lessee be unable to agree upon an alternative plan as set forth in the
immediately preceding sentence of this Section 9.1(d)(iii), or if Lessee is unable to secure all
approvals and permits necessary to commence construction of such alternative plan from
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applicable Governmental Authorities within eighteen (18) months of making the initial application
therefor, then Lessee shall not proceed with the alternative plan and shall instead fund the cost of
the Enhanced Public Access Improvements in an amount equal to the lesser of (A) the estimated
construction cost and budget for the proposed In Water Work not approved by Governmental
Authorities (as such estimate is revised from time to time), and (B) the Enhanced Public Access
Improvement Costs, both those costs already allocated to Lessor and taken by Lessee as a Monthly
Credit (in which case Lessee shall reimburse Lessor for the amount of such Monthly Credit taken),
and that portion of Enhanced Public Access Improvement Costs for which no Monthly Credit has
yet been taken.
(iv) As promptly as is reasonably feasible following issuance of the In Water
Permits by Governmental Authorities, Lessee shall direct the Design Team to prepare design
development plans for the In Water Work (incorporating modifications required by the
Governmental Authorities as a condition for approval, if any) and shall direct that such plans be
completed within sixty (60) days of permit issuance. The design development plans shall be
subject to the review and approval of Lessor, not to be unreasonably withheld, conditioned or
delayed (such plans as approved by Lessor, the “In Water DD Plans”). For the avoidance of doubt,
the In Water Work shall be a portion of the Baseline Public Access Improvements and shall not be
a portion of the Enhanced Public Access Improvements. As such, decisions regarding budget and
the review and approval of change orders in connection with the In Water Work shall be made
solely by Lessee except as noted in the next sentence of this Section 9.1(d)(iv). Change orders or
other decisions that involve any material reduction in or change to the scope of the In Water Work
as compared to the In Water DD Plans, or any material elongation of the construction schedule for
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completion (other than as a result of Unavoidable Delays), shall be made by Lessee subject to
approval by Lessor, not to be unreasonably withheld, conditioned or delayed.
(v) Upon approval of the In Water DD Plans by Lessor, Lessee shall reformat
and prepare updated plans for the In Water Work portion of the Public Access Improvements that
will be attached hereto as Appendix A-1, in substitution of the conceptual designs for the In Water
Work attached as Appendix A-1 upon the Execution Date.
(e) The preparation of designs and securing the approval of Governmental Authorities
for the Other Work shall proceed as in the following manner:
(i) Lessee shall direct the Design Team to complete, within four (4) months
after the date the Design Team is retained pursuant to Section 9.1(c), a survey (including elevations
and, as may be necessary, probes and core samples) indicating current site conditions and
schematic design plans for the Other Work inclusive of plans, elevations, and CSI formatted
specifications for proposed finished materials. Such schematic design plans for the Other Work
shall be provided to Lessor upon completion and shall include plans and specifications for both (i)
the Baseline Public Access Improvement for the Other Work (i.e., without the Enhanced Public
Access Improvements), and (ii) the Other Work that includes the Enhanced Public Access
Improvements. Lessor shall review and consult with Lessee regarding such separate schematic
design plans and provide comments, if any (including without limitation modifications or deletions
to the Enhanced Public Access Improvements), within sixty (60) days after receipt from Lessee.
Lessee shall thereafter consider Lessor’s comments, if any, and shall, within sixty (60) days of
receipt of comments by Lessor, make such revisions that Lessee determines in its reasonable
judgement are necessary and appropriate in order for the Other Work to be in compliance with this
Section 9.1 and the Requirements, and submit such revision, if any, to Lessor for Lessor’s approval
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not to be unreasonably withheld, conditioned or delayed (such plans as approved by Lessor, the
“Other Work Schematic Plans”).
(ii) Upon completion of the Other Work Schematic Plans, Lessee shall direct
the Design Team to prepare, within sixty (60) days, (x) design development plans for the Other
Work, and (y) separate preliminary construction cost estimates for the Baseline Public Access
Improvements and Enhanced Public Access Improvements portions of the Other Work and provide
such plans and estimates to Lessor. The design development plans shall be subject to the review
and approval of Lessor, not to be unreasonably withheld, conditioned or delayed (such plans as
approved by Lessor, the “Other Work DD Plans”). Notwithstanding anything to the contrary
contained in this Section 9.1, should Lessor determine in its sole discretion following consultation
with Lessee that any element of the Enhanced Public Access Improvements should be modified or
deleted, then Lessee shall so direct the Design Team to make such change.
(iii) As promptly as is reasonably feasible following Lessee’s completion of the
Other Work DD Plans, Lessee shall reformat and prepare updated plans for the Baseline Public
Access Improvement portion of the Other Work and the Enhanced Public Access Improvement
portion of the Other Work that will be attached hereto as Appendix A-2, in substitution of the
Other Work conceptual designs attached as Appendix A-2 upon the Execution Date.
(f) Preparation of construction documents and contracting for the Other Work and In Water
Work shall proceed in the following manner, provided however that should the Commencement
Date have not yet occurred, the bidding for such work shall not begin until three (3) months after
the Commencement Date or, if later, three (3) months after the completion of the Other Work DD
Plans as contemplated by Section 9.1(e)(ii):
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(i) Except as set forth in this Section 9.1(f), permitting, preparation of designs
and contract documents, bidding and construction of the Other Work and the In Water Work shall
proceed independently, but the scheduling for each shall be coordinated by Lessee.
(ii) Lessee may, in its sole but reasonable discretion, determine that permit
applications for the Other Work shall be secured before, during or after bidding for such work.
Lessee shall advise Lessor of its decision regarding the timing of such permitting and provide
copies of such applications when submitted to Governmental Authorities, and Lessor shall provide
reasonable cooperation including signing applications “as owner” when necessary.
Notwithstanding anything to the contrary contained in this Section 9.1, Lessee shall comply with
the Requirements regarding the submission and approval of permit applications and the
commencement of the Other Work.
(iii) Within sixty (60) days after completion of each of the In Water DD Plans
and Other Work DD Plans, Lessee shall direct the Design Team to complete the remaining
construction documents and shall submit each such construction document for review by Lessor
solely for the purpose of confirming consistency with requirements of this Section 9.1 (such plans
as approved by Lessor, the “Other Work CD Plans” and “In Water Work CD Plans” respectively).
(iv) Within thirty (30) days after completing each of the Other Work CD Plans
and In Water Work CD Plans, Lessee shall prepare Bid Documents (as further detailed below in
this Section 9.1(f)(iv)) for each component of the In Water Work and the Other Work and provide
such Bid Documents to Lessor. Bid Documents for the Other Work shall seek separate pricing for
(x) the Baseline Public Access Improvements (the “Base Cost”) and (y) an Add-Delete Alternate
for the additional work designated as Enhanced Public Access Improvements less Other Work
components of the Baseline Public Access Improvements not being undertaken as a consequence
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of the Enhanced Public Access Improvements) (the “Add-Alt Cost”). Lessee and Lessor agree
that they shall allocate in the budget an additional fifteen percent (15%) for the cost of Enhanced
Public Access Improvements as an allowance for potential change orders, whether arising from
job conditions that were unknown at the time the Bid Documents were issued or other changes that
are discretionary (“Change Orders”). Lessee may, following consultation with Lessor, utilize a
request for proposal with multiple selection criteria rather than a bid process based solely on lowest
cost from a qualified bidder (also referred to hereafter as the “Bid Documents”). The Bid
Documents shall be subject to Lessor’s review and approval prior to bidding, which approval shall
not be withheld unless Lessor determines that the Bid Documents are not in compliance with the
requirements of this Section 9.1. Lessee shall issue the Bid Documents within fifteen (15) days of
receipt of Lessor’s approval. Lessee may, in its sole but reasonable judgement and following
consultation with Lessor, aggregate or separate the construction components such that there is one
or more contracts for the In Water Work and a one or more contracts for Other Work.
(v) Lessee shall use commercially reasonable efforts to obtain not less than
three (3) bids or proposals for each construction contract(s) issued for bidding. Following the
initiation of the bidding for each such construction contract (s), Lessee shall provide Lessor with
(u) copies of bidder responses to the Bid Documents, (v) follow up clarification questions posed
to each bidder together with potential bidder responses, when submitted; (w) Lessee’s bid leveling
and analysis of submitted bids or proposals, including a separate analysis of the Add-Alt Cost
reflecting the incremental cost of the Enhanced Public Access Improvements; (x) a statement of
the projected costs to construct the Baseline Public Access Improvements for each of the In Water
Work and Other Work and the Enhanced Public Access Improvements (including all third party
soft and hard costs associated with the design and implementation of the Baseline Public Access
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Improvements and Enhanced Public Access Improvements incurred and anticipated to the end of
such work, Change Order allowances, cost of obtaining approvals from required Governmental
Authorities and the processes contemplated by this Section 9.1 in connection with the Baseline
Public Access Improvements and Enhanced Public Access Improvements; such third party soft
and hard costs are referred to as the “Baseline Public Access Improvements Costs” and the
“Enhanced Public Access Improvement Costs”), (y) a schedule for commencement, phasing and
completion of each component of the Public Access Improvements (including, without limitation,
a construction logistics plan that addresses maintaining adequate north-south pedestrian circulation
through the Premises for Park patrons) which shall be updated by Lessee and transmitted to Lessor
monthly during the construction of the Public Access Improvements (such schedule as may be
updated from time to time, the “Public Access Improvement Schedule”), and (z) copies of all
proposed construction contracts in connection therewith (the final construction contracts entered
into by Lessee for the construction of the Baseline Public Access Improvements and the Enhanced
Public Access Improvements are referred to as the “Public Access Improvements Construction
Contracts”).
(vi) Within thirty (30) days after Lessee’s submission to Lessor of all applicable
materials described in clauses (u) through (y) of Section 9.1(f)(v) with respect to any single
construction contract or grouping of construction contracts, and the proposed construction
contracts referred to in clause (z) of Section 9.1(f)(v), Lessor shall give Notice to Lessee as to
whether the experience and qualifications of the submitting construction contractor(s) are
acceptable and the identified Enhanced Public Access Improvements Costs are reasonable. If
Lessor does not give such Notice within such period, then responsible senior executives of Lessor
and Lessee shall meet to reconcile any differences between Lessor and Lessee by mutual
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agreement. The Enhanced Public Access Improvements Costs that are either approved by Lessor
or reconciled by mutual agreement of Lessor and Lessee are referred to as the “Budgeted Enhanced
Public Access Improvement Plan Costs”.
(vii) Lessee shall not be required to accept any bids for the Enhanced Public
Access Improvements for which the Budgeted Enhanced Public Access Improvement Costs are
reasonably likely in Lessee’s sole but reasonable judgment to exceed Three Million Dollars
($3,000,000.00) unless Lessor agrees to include such excess amounts in the Budgeted Enhanced
Public Access Improvements Costs and the Final Enhanced Public Access Improvements Costs
for purposes of Section 9.1 (any such Lessor-approved excess amounts, “Additional Credit Base
Amounts”). Should the bid cost for the Enhanced Public Access Improvement exceed Three
Million Dollars ($3,000,000.00), Lessee shall, upon the request of Lessor, direct the Design Team
to perform a value engineering exercise to determine how such costs can be reduced including by
modification and deletion of elements of the work. If any approval or any determination of either
Lessee or Lessor that is required by the terms of this Section 9.1(f) is not granted or obtained, then
Lessee shall, in consultation with Lessor, repeat the applicable procedures contemplated by this
Section 9.1 to the extent necessary in order that the applicable approval(s) are granted and/or the
applicable determinations are obtained.
(viii) Throughout the period of construction of the Public Access Improvements,
Lessee shall provide to Lessor all backup information reasonably requested by Lessor to confirm
Lessee’s compliance with this Section 9.1, including copies of work-in-progress inspection
reports. If Lessee initiates or receives a request from a contractor for (x) a Change Order for the
Enhanced Public Access Improvements, or (y) a Change Order or other request that materially
changes the scope of the Baseline Public Access Improvements or materially elongates the Public
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Access Improvement Schedule (other than as a result of Unavoidable Delays), Lessee shall
promptly deliver a notice of such proposed Change Order to Lessor seeking approval or denial
together with Lessee’s recommendation as to whether the Change Order should be approved.
Lessor shall advise Lessee after receipt of such proposed Change Order within the period
prescribed in the applicable construction contract as to whether Lessor approves such Change
Order, such approval not to be unreasonably withheld, conditioned or delayed. If Lessor fails to
respond to Lessee’s Change Order submission within the time limits prescribed in the applicable
construction contract, Lessor shall be responsible for contractor delay costs actually incurred and
reasonably documented by Lessee that may result from such Lessor failure. Lessee shall use
commercially reasonable efforts to adjust the construction schedule to the extent feasible to avoid
the imposition of contractor delay costs. In addition, if Lessor requests that Lessee initiate a
Change Order for the Enhanced Public Access Improvements that would cause the Budgeted
Enhanced Public Access Improvement Costs to exceed the sum of Three Million Dollars
($3,000,000), Lessee shall advise Lessor whether or not it approves such Change Order within five
(5) business days after receipt of such request from Lessor, such approval not to be unreasonably
delayed, withheld or conditioned, provided, however, that Lessee shall not be deemed to be acting
unreasonably if it conditions its approval of such Change Order on Lessor agreeing to pay the sum
by which the requested Change Order causes the cost of the Enhanced Public Access
Improvements to exceed Three Million Dollars ($3,000,000.00). Upon Lessee’s approval of any
Change Order for the Enhanced Public Access Improvements, the amount of such Change Order
shall be added to or deducted from (as applicable) the Budgeted Enhanced Public Access
Improvements Costs, and, if such amount causes the Budgeted Enhanced Public Access
Improvements Costs to exceed the sum of Three Million Dollars ($3,000,000) plus the amount of
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any previously-approved Additional Credit Base Amounts, such amount shall be considered an
Additional Credit Base Amount and shall be added to the previously-approved Additional Credit
Base Amounts. Except as set forth in this Section 9.1(f)(viii), Lessee shall not be required to obtain
Lessor’s approval for change order work.
(ix) For the avoidance of doubt, unless expressly approved by Lessor in writing
pursuant to clause (4) of the definition of Enhanced Public Access Improvements in Section 9.1(a),
Enhanced Public Access Improvement Costs, Budgeted Enhanced Public Access Improvement
Costs, and Final Enhanced Public Access Improvement Costs shall only be with respect to the
Other Work and the Other Permits attributable to Enhanced Public Access Improvements and shall
not include the In Water Work or In Water Permits.
(g) Promptly after obtaining applicable Lessor approvals set forth in this Section 9.1,
applicable approvals from Governmental Authorities pursuant to the Requirements, the approval
of or reconciliation of the Budgeted Enhanced Public Access Improvement Costs pursuant to
Section 9.1 with respect to Enhanced Public Access Improvements, and the execution by Lessee
and the counterparties of the Public Access Improvements Construction Contracts, Lessee shall
commence and thereafter diligently prosecute construction of the Other Work and the In Water
Work (subject to Unavoidable Delays) in accordance with such contracts, it being acknowledged
that the Other Work may precede the In Water Work and certain components of the Other Work
may precede others. Lessee shall use commercially reasonable efforts to complete the Other Work
and the In Water Work within eighteen (18) months following the execution by Lessee and the
counterparty of the first such Public Access Improvements Construction Contract for each,
provided that, at Lessee’s discretion, completion of the Other Work in the area of the In Water
Work need not occur until the In Water Work in such area is first completed; and provided further
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that such eighteen (18) month period shall be (y) subject to Unavoidable Delays, and (z) extended
by such number of days as is equal in the aggregate to the periods during such 18-month period
that are consumed by Lessor in determining whether to grant or withhold any approvals required
of Lessor during such 18-month period that are in excess of the review and approval time periods
set forth herein, any periods during such 18-month period that are consumed in Lessee repeating
any procedures required by this Section 9.1 due to Lessor not granting any approvals required of
Lessor during such 18-month period, and any periods during such 18-month period that are
consumed in the course of Lessor and Lessee reaching any agreement on reconciliation of matters
as to which they do not initially agree.
(h) Following the commencement of construction of the Public Access Improvements,
Lessee shall provide Lessor, on an ongoing basis, with copies of all construction invoices and
evidence of payment by Lessee of such invoices together with partial lien waivers from contractors
and subcontractors to whom payment was made. Invoices with respect to the Enhanced Public
Access Improvements shall be submitted to Lessor in reasonable detail and subject to Lessor’s
review and approval for inclusion as Enhanced Public Access Improvement Costs, but with
payment by Lessee to contractors not subject to Lessor approval. Subject further to the allocation
of costs as set forth in Section 9.1(s), Lessee shall direct both the Design Team and construction
contractors to designate invoiced amounts as either Baseline Public Access Improvements (and
whether for In Water Work or Other Work) or Enhanced Public Access Improvements. Lessor
review and approval of invoices for inclusion as Enhanced Public Access Improvements shall be
based solely on consistency with the provision of this Section 9.1, and such approval shall not be
unreasonably withheld, delayed or conditioned. If Lessor’s approval or disapproval of any invoice
for Enhanced Public Access Improvements is not received by Lessee within ten (10) Business
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Days after such invoice is submitted to Lessor, Lessor’s approval of such invoice shall be deemed
to have been granted. Lessee’s submission of invoices for the In Water Work and portions of the
Other Work that are not Enhanced Public Access Improvements shall be for information purposes
only and not subject to Lessor review and approval. Such invoice documentation shall start upon
the later to occur of (x) six months following the commencement of construction of the Enhanced
Public Access Improvements, and (y) the date upon which the sum of such paid invoices for the
aggregate of completed In Water Work or Other Work, as the case may be, equals at least
$250,000.
(i) As of the date on which Lessee has spent $500,000 in the aggregate of Enhanced
Public Access Improvements Costs, provided that the invoices included in such amount that are
required to be approved by Lessor pursuant to Section 9.1(h) have been approved (or deemed
approved), the amount of each of the eighty-four (84) installments of Fixed Base Rent that would
otherwise be due commencing on the first day of the second month thereafter pursuant to Section
3.1 shall be reduced by one eighty-fourth (1/84) of the Budgeted Enhanced Public Access
Improvement Costs (as such amount may be revised from time to time during the construction by
Lessor, in its sole but reasonable discretion and following written Notice to Lessee and opportunity
to comment by Lessee), provided that the aggregate amount of such Fixed Base Rent reductions
shall not exceed the sum of Three Million Dollars ($3,000,000) plus any Additional Credit Base
Amounts); each such reduction in a monthly installment of Fixed Base Rent is referred to as a
“Monthly Credit.”
(j) No later than thirty (30) days after the submission by Lessee to Lessor of the
materials required by Section 9.1(l), Lessee shall provide to Lessor a final accounting of the
Enhanced Public Access Improvements Costs incurred by Lessee, in sufficient detail and with such
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supporting materials and information as is reasonably necessary in order for Lessor to validate the
eligibility and amount of such costs. Lessor’s review and approval of such final accounting of costs
of Enhanced Public Access Improvement Costs shall be based solely on consistency with the
provisions of this Section 9.1 and industry standard accounting principles and practices, and shall
not be unreasonably withheld, delayed or conditioned. Within forty-five (45) days after Lessor’s
receipt of such accounting and supporting materials, Lessor shall either approve such final costs
or shall give Notice to Lessee of the specific components of such final costs that Lessor finds not
to be in compliance with the requirements of this Section 9.1 and the specific reasons for such
findings; provided that Lessor shall not be required to approve proposed Final Enhanced Public
Access Improvement Costs that exceed the sum of Three Million Dollars ($3,000,000) plus any
Additional Credit Base Amounts. If Lessor does not approve the Final Enhanced Public Access
Improvement Costs proposed by Lessee, then responsible senior officers of Lessor and Lessee
shall meet together to reconcile and mutually agree upon the approved Final Enhanced Public
Access Improvement Costs (which shall not, in any event, be in excess of the sum of Three Million
Dollars ($3,000,000) plus any Additional Credit Base Amounts). The final Enhanced Public
Access Improvements Costs as so approved by Lessor or reconciled and approved by Lessor and
Lessee as described in this Section 9.1(j) is referred to as the “Final Enhanced Public Access
Improvement Cost.” If the Final Enhanced Public Access Improvement Cost Amount differs from
the Budgeted Enhanced Public Access Improvement Costs (as such amount may have been revised
as set forth herein) that has previously been the basis for the Monthly Credit, then in the second
calendar month following such Lessor approval or such reconciliation, the Monthly Credit and
amount of the Fixed Base Rent payable by Lessee shall be increased or decreased (as applicable)
by an amount equal to the difference between the Final Enhanced Public Access Improvement
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Cost Amount and the Budgeted Enhanced Public Access Improvement Amount amortized over
the remaining period for Monthly Credits. Other than the reductions in Fixed Base Rent as set
forth in this Section 9.1(j), no other conditions or terms provided for in Article 3 are modified.
Notwithstanding anything to the contrary contained herein, nothing in this Section 9.1 shall limit
the authority of Lessee (subject to obtaining any requisite Lessor approvals or approvals from
Governmental Authorities) from electing in Lessee’s sole discretion to expend more in Enhanced
Public Access Improvement Costs than the amount approved by Lessor and thereby forgo the right
to receive any further increase in Monthly Credits and reductions in Fixed Base Rent.
(k) Lessor shall have the right to conduct inspections, which may be performed by a
contractor or agent hired by Lessor, as work in connection with the Public Access Improvements
proceeds. Lessor shall provide Lessee with 24 hours advance notice of such inspection along with
the name of the person conducting the inspection and such inspection shall occur during normal
business hours. Lessor’s inspections are for purposes of reviewing that the construction is
proceeding in accordance with the construction documents and such inspections do not relieve
Lessee of complying with the construction plans and all permits and other approvals required by
any Governmental Authority, including the New York City Department of Buildings. Nothing in
this Section 9.1(k) obligates Lessor to conduct any inspections.
(l) Upon completion of construction of components of the Public Access
Improvements, Lessee shall provide notice to Lessor and shall thereafter provide Lessor copies of
the “As-Built” drawings with respect to the Public Access Improvements; copies of all guarantees
and warranties on labor, materials and equipment in accordance with the applicable construction
plans and specifications with respect to the Public Access Improvements to the extent generally
available within the relevant industry for similar work; and such other documentation with respect
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to the Public Access Improvements as Lessor may reasonably request confirming that the
completed Public Access Improvements were undertaken and paid in accordance with this Section
9.1.
(m) In the event Lessee fails to (i) proceed with the construction components of the
Enhanced Public Access Improvements in approximately the order contemplated by the
construction documents after receiving all required approvals from Lessor and applicable
Governmental Authorities (subject to Unavoidable Delays and any other extensions of time
described in Section 9.1(g)), or to proceed with such construction in accordance with the Public
Access Improvement Schedule (subject to Unavoidable Delays and any other extensions of time
described in Section 9.1(g)), (ii) pay the contractors performing the Public Access Improvements
other than as a result of Lessee’s or Lessor’s disapproval of specific invoices, or (iii) cause any
lien filed against the Premises or Lessee’s interest in this Lease in connection with the performance
of such Improvements to be discharged in accordance with the terms of this Lease, Lessor may,
after written Notice to Lessee specifying the circumstances described in clause (i), (ii) or (iii) of
this sentence as to which Lessee is alleged to have failed, if such failure is not cured within fifteen
(15) days after the giving of such Notice, suspend each Monthly Credit as set forth in Section 9.1(i)
and extend the period for such Monthly Credit by the length of such suspension (by way of
example, should the suspension last for three (3) months, the last Monthly Credit would occur at
the eighty-fifth month after the first Rent Credit Claim was granted). If Lessee fails to cure a
failure to commence or continue the construction of Public Access Improvements in accordance
with the Public Access Improvement Schedule that is described in this Section 9.1(m) (subject to
Unavoidable Delays) within thirty (30) days (or such longer period as is required in order that no
circumstance giving rise to an Unavoidable Delay exists and no other extensions of time described
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in Section 9.1(g) are applicable) after receiving written Notice from Lessor requiring Lessee to
proceed with the work then, in addition to all other remedies available to Lessor under this Lease,
Lessee shall pay all Rental credited as Monthly Credit within sixty (60) days of receipt of a second
written Notice from Lessor (“Second Notice”) demanding repayment of all Rental credited as
Monthly Credit, with such repayment amounts owed as Rental. Lessee’s failure to pay all
repayment of Monthly Credits owed in accordance with this Section 9.1(m) within sixty (60) days
of receipt of Lessor’s Second Notice pursuant to this Section 9.1(m) shall be an Event of Default
under Section 22.1(a). Nothing in this Section 9.1(m) shall limit Lessor’s right to further find that
Lessee’s failure to complete the Public Access Improvements, including the Enhanced Public
Access Improvements, after receiving the Second Notice is also an Event of Default under Section
22.1(c) of this Lease.
(n) To the extent there should be a conflict between the provisions of this Section 9.1
and those of Article 11 with respect to the construction of the Baseline Public Access
Improvements and the Enhanced Public Access Improvements, then the provisions of this Section
9.1 shall prevail.
(o) Upon completion of the Enhanced Public Access Improvements (whether in part or
whole), Lessee shall assume maintenance and repair responsibilities for such completed work in
accordance with Article 10 of this Lease and no such maintenance and repair costs related thereto
shall be allocated to the Budgeted Enhanced Public Access Improvement Amount or the Final
Enhanced Public Access Improvement Costs or cause any increase in the Monthly Credit.
(p) Where no time period is specified in this Section 9.1 for performance by one of the
parties, the time allowed shall be deemed to be “with reasonable promptness.”
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(q) The design, permitting and construction of Public Access Improvements by Lessee,
and the exercise of review and approval rights with respect to such design, permitting and
construction of Public Access Improvements by Lessor (including Lessor’s right to direct
modifications and deletions to Enhanced Public Access Improvements), all undertaken in
conformance with this Section 9.1, shall be performed and conducted in a consistent manner such
that the Public Access Improvements are (i) professionally designed and constructed in accordance
with the provisions of this Lease, the Requirements and prevailing industry standards, (ii) complete
and contain all elements necessary to fulfill their intended purpose and function, and (iii) as
applicable, properly integrated with the Existing Improvements and Lessor’s improvements
located outside of the Premises in the Park. The standard set forth in the immediately preceding
sentence shall apply without limitation to the Baseline Public Access Improvements, the Enhanced
Public Access Improvements, the In Water Work, the Other Work, the preparation and approval
of the In Water Schematic Plans, the Other Work Schematic Plans, the In Water DD Plans, the
Other Work DD Plans, the In Water CD Plans, the Other Work CD Plans, the Bid Documents, the
Public Access Improvement Contracts, the Change Orders, the preparation and approval of cost
estimates and budgets (including the Budgeted Enhanced Public Access Improvement Costs),
Lessor’s review of and commentary upon the Schematic In Water Designs and the cost estimates
therefor, the performance of value engineering exercises to determine how costs can be reduced,
the review and approval of invoices and the Final Enhanced Public Access Improvement Costs,
and the supervision, administration and inspection of the In Water Work and the Other Work.
(r) If and to the extent any change, improvement, restoration or repair is required with
respect to the Existing Improvements as a result of the construction of the Public Access
Improvements (including without limitation work related to roofs, walls, doors and entrances,
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drainage, expansion joints, waterproofing, relocation of ticket booths, security features, and
lighting) such change, improvement, restoration or repair shall form part of the complete Public
Access Improvements, and the third party design and construction costs associated therewith shall
be reasonably allocated by Lessee (subject to Lessor review and reasonable approval) as either or
proportionately both Baseline Public Access Improvements and Enhanced Public Access
Improvements, with such cost allocation based on Lessee’s reasonable determination of: (i) extent
to which the construction of such Public Access Improvements impacts the Existing Improvements
(and whether such impact is caused by Baseline Public Access Improvements or Enhanced Public
Access Improvements or both), and (ii) the construction elements required to restore and properly
integrate the Existing Improvements at the same or similar level of design quality, materials and
function as existed prior to Lessee undertaking such Public Access Improvements. Any upgrade,
addition or other change to the Existing Improvements by Lessee not caused by the construction
of the Public Access Improvements shall be undertaken by Lessee at its sole cost and expense and
subject to the applicable provisions of Article 11.
Section 9.2. In order to provide the local community with an opportunity to make public
comment on Lessee’s business operations and Lessee’s impact on the local community, Lessee
shall meet with Manhattan Community Board 4 (“CB4”), or any committee designated by CB4,
if requested by Lessor based on Lessor’s receiving a request for a meeting by CB4, provided that
Lessee shall not be required to convene or attend such meetings more frequently than annually
unless such meeting is in the nature of follow-up to the initial meeting to address Lessee’s
operations, including the benefits it provides to the local community and resolutions to address
concerns raised by the local community. The purpose of each such meeting shall be for Lessee to
solicit comments from the CB4 members and the public on Lessee’s performance. Lessee shall
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provide Lessor with a copy of any comments received, together with Lessee’s written response to
such comments and a summary of such meeting within thirty (30) days after such meeting. To the
extent that any such comments identify a concern with Lessee’s performance, Lessee shall include
a proposed resolution to address the concern expressed. Lessor shall give Lessee at least thirty
(30) days’ prior notice of any scheduled meeting (or, if the meeting is scheduled on less than thirty
(30) days’ notice, Lessor shall give Lessee notice on the first Business Day after such a meeting
has been scheduled) and Lessee may have one or more of its representatives attend the meeting.
Notwithstanding anything to the contrary contained herein, Lessee’s undertaking to address
concerns expressed by the local community as set forth in this Section 9.2 shall proceed with
reasonable cooperation by Lessee, but shall not, unless voluntarily agreed by Lessee, create new
obligations under this Lease.
Section 9.3. In addition to the Baseline Public Access Improvements and the Enhanced
Public Access Improvements contemplated by Section 9.1, (i) Lessee shall undertake the
additional green energy, service road sidewalk improvements, service road driveway
improvements, garage entrance improvements, and bikeshare stations installation all in accordance
with Lessee’s letter of May 10, 2022 to CB4 (a copy of which letter is annexed hereto as Exhibit
M), and (ii) Lessor and Lessee shall implement the Eastern Frontage Planning Effort and Lessee
shall undertake other measures to limit parking as set forth in Exhibit N annexed hereto.
REPAIRS
Section 10.1. (a) Lessee shall take good care of the Premises, including, without
limitation, the Improvements, roofs, piers, supports, pilings, bulkheads, foundations and
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appurtenances thereto, above or below the surface of the water, all sidewalks, vaults (other than
vaults which are under the control of, or are maintained or repaired by, a utility company), sidewalk
hoists, water, sewer and gas connections, pipes and mains that are located on or service the
Premises (unless a Governmental Authority or a public utility company is obligated to maintain or
repair the same), and all Equipment and shall put, keep and maintain or repair the same in good
and safe condition, and make all repairs therein and thereon, interior and exterior, structural and
nonstructural, foreseen and unforeseen, necessary or appropriate to allow Lessee its use of the
Premises, and whether or not necessitated by wear, tear, obsolescence or defects, latent or
otherwise, provided, however, that Lessee’s sole obligations with respect to Restoration resulting
from a Casualty or condemnation shall be as provided in Articles 6 and 7 hereof. Notwithstanding
any other provision of this Lease, and, provided further, that Lessee shall not be responsible for
any actions or obligations under this Lease with respect to the City owned main sewer overflow
discharge lines running in an east-west direction, Lessee shall not commit or suffer, and shall use
all reasonable precaution to prevent, waste, damage or injury to the Premises. When used in this
Section 10.1, the term “repairs” shall include all necessary replacements, alterations and additions
required to allow Lessee its use of the Premises in accordance with the terms of this Lease. All
repairs to Lessee Improvements shall be made by Lessee and shall be at least equal in quality and
class to the original work and shall be made in compliance with all Requirements. Over the Term
of the Lease, Lessee shall make commercially reasonable efforts to match the quality and design
of exterior facing elements, such as benches, planting beds, trash cans, and other Park furniture
(hereinafter, each type of element being an “Element”) when an Element within the Premises is
entirely replaced or updated by Lessee, with a replaced or updated Element of a similar quality
and design as used elsewhere in the Park. Notwithstanding any other provision of this Lease,
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Lessee shall not be obligated to repair any damage to the Premises caused by Lessor unless Lessor
agrees to reimburse, or at Lessee’s option, provide a rent credit to Lessee for the costs of such
repairs. Nothing in this Lease shall be construed to limit in any way any liability or obligations of
Lessor, or any other Governmental Authority, would otherwise have with respect to any damage
to the Premises resulting from any construction or related activity performed or conducted by
Lessor or such Governmental Authority.
(b) Nothing in this Article 10 shall preclude Lessee from proposing or applying for
participation in any governmental program or plan under which funding could be made available
for repair or maintenance of waterfront piers, provided, however, that such funding program is
unrelated to, and does not otherwise constitute, funding that would be a part of Lessor’s capital or
operating budget. Lessor shall provide reasonable cooperation to Lessee (which cooperation may
include, with Lessor’s consent (which shall not be unreasonably withheld, conditioned or delayed),
being a co-applicant on or co-sponsor of such proposal or application) to facilitate and enable such
funding proposal or application. This Section 10.1(b) shall in no way be deemed to require Lessor,
and Lessor is not required to, either (i) include the Premises in any proposal or application that
Lessor makes for funding in respect of capital or maintenance costs, or (ii) undertake such repair
or maintenance as an obligation of Lessor.
Section 10.2. Lessee shall keep or cause to be kept clean and free from dirt, snow, ice,
rubbish, obstructions, the sidewalks, grounds, chutes and hoists comprising, in front of or adjacent
to, the Premises.
Section 10.3. If, during the Term, any of the lands underwater included in the Premises
leased by Lessee become obstructed in whole or in part by the sinking of any waterborne craft,
other than a waterborne craft owned or operated by Lessor, then Lessee, at Lessee’s cost and
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expense, shall use commercially reasonable and diligent efforts to cause such obstructions to be
removed at no expense to Lessor. If, however, any obstruction is caused by waterborne craft
owned or operated by Lessor, then Lessor, at Lessor’s cost and expense, shall use commercially
reasonable and diligent efforts to cause such obstructions to be removed at no cost to Lessee.
Section 10.4. Lessee shall not throw, discharge or deposit or permit to be thrown,
discharged or deposited any cargo, refuse, ashes or any materials whatsoever, into or upon the
waters at or about or adjacent to the Premises.
Section 10.5. Lessee acknowledges and agrees that dredging of any underwater areas of
the Premises, at Lessee’s sole cost, shall only occur with the prior written approval of Lessor and
if permitted by applicable Requirements.
Section 10.6. Except as expressly provided in this Lease, Lessor shall not be required to
furnish any services, utilities or facilities whatsoever to the Premises, nor shall Lessor have any
duty or obligation to make any alteration, change, improvement, replacement, Restoration or repair
to, nor to demolish, any Improvements. Lessee assumes the full and sole responsibility for the
condition, operation, repair, alteration, improvement, replacement, maintenance and management
of the Premises. Lessee shall not clean nor require, permit, suffer nor allow any window in the
Improvements to be cleaned from the outside in violation of Section 202 of the Labor Law or of
the rules of the Industrial Board or other Governmental Authority.
Section 10.7. Intentionally omitted.
Section 10.8. Lessee shall complete the approved Chelsea Piers Repair Plan as set forth
in the schedule therein.
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Section 10.9. (a) During 2026 and every five (5) years thereafter throughout the Term,
Lessee shall cause the Approved Engineer to inspect all marine structure elements at the Premises
and prepare and submit a comprehensive marine inspection report, which report shall apply (A)
the standards to which Lessee is required to adhere pursuant to Section 10.1(a) of this Lease based
upon Lessee’s Use of the Premises; and (B) the scope, activities and report format for “Routine
Inspections” set forth in the NYCEDC Guidelines Manual (such inspection and each such
subsequent inspection so conducted shall be a “Comprehensive Inspection”). The Comprehensive
Inspections shall be performed at a minimum of every five years after 2026 during the remaining
Term of the Lease. Lessee shall update the Chelsea Piers Repair Plan on a basis that is consistent
with each applicable Comprehensive Inspection and prepare and submit to Lessor an updated
Chelsea Piers Repair Plan for the five-year period after each applicable Comprehensive Inspection.
(b) In addition to the required Comprehensive Inspections, Lessee shall engage the
Approved Engineer to perform, on an as-needed basis taking into account all relevant factors,
interim inspections of the conditions identified in the most recently completed Comprehensive
Inspection in order to properly identify potentially accelerated deterioration or apparent non-
compliance with the requirements of Section 10.1(a) of this Lease that may have arisen since the
date of the last Comprehensive Inspection based on the Lessee’s Use of the Premises. The
frequency and extent of interim inspections shall be determined by Lessee following consultation
with the Approved Engineer as to the necessity therefor. The rationale for either undertaking
interim inspections or determining that such inspections are not necessary shall be provided to
Lessor annually. Lessee shall provide Lessor with a copy of each interim inspection report
promptly after submission to Lessee by the Approved Engineer. Each Comprehensive Inspection
and interim inspection shall be performed and completed at Lessee’s sole cost and expense.
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(c) Lessee shall provide Lessor with a copy of each Comprehensive Inspection report
promptly after approval by Lessee. Based on Lessee’s Use of the Premises, Lessor shall issue
comments, if any, to Lessee within thirty (30) Business Days of receipt of a Comprehensive
Inspection report unless Lessor notifies Lessee that, at Lessor’s expense, Lessor’s Engineer shall
be undertaking an inspection, in which case comments shall be provided by Lessor to Lessee within
fifteen (15) Business Days of completion of such Lessor inspection. Lessee shall forward Lessor’s
comments, if any, to the Approved Engineer within five (5) days of receipt, and cause Approved
Engineer to consider such comments, and (i) should the Approved Engineer concur, incorporate
such comments as to which the Approved Engineer agrees into the Comprehensive Inspection
report, or (ii) should the Approved Engineer disagree, respond in writing to Lessor regarding each
comment to which Approved Engineer does not agree, with reasons for not incorporating such
comments, after which the Approved Engineer and Lessor’s Engineer shall be directed by Lessee
and Lessor to meet to resolve any remaining differences with respect to the Comprehensive
Inspection report. Notwithstanding Lessor’s submission of comments or anything contained
therein, Lessee assumes full responsibility for the Comprehensive Inspection report and the
conclusions, assessments, and recommended course of action therein and for compliance with the
repair and maintenance obligations under this Lease and the Requirements, and hereby forever
releases Lessor from any liability, and indemnifies and holds harmless Lessor from any and all
third party claims in connection therewith that may arise or accrue during the term of the Lease,
except to the extent proximately caused by the gross negligence or willful misconduct of Lessor.
(d) Concurrent with submission of each Comprehensive Inspection report, but in no
event later than sixty (60) days after the date of completion of such report, Lessee shall cause the
Approved Engineer to submit a recommended piers repair plan identifying all proposed Pier Repair
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Work, if any. Such recommended piers repair plan shall set forth a proposed scope of Pier Repair
Work determined to be necessary by the Approved Engineer so as to first address structural
elements identified as necessary to support Lessee’s Use of the Premises which (i) exhibit more
significant or extensive deterioration, or (ii) where clusters of piles or individual piles may be
stressed under the Loading Plan for Lessee’s Use, or (iii) where multiple piles and/or pile caps
and/or other below-pier deck or above-pier deck structural elements are affected. The proposed
scope for such Pier Repair Work may be phased over multiple years, provided that it is prioritized
and sequenced in accordance with criteria which emphasize and ensure the safety and preservation
of the piers and other marine structures of the Premises for Lessee’s Use of the Premises during
such time period. Lessee shall promptly submit such recommended piers repair plan to Lessor for
its review and approval, together with a statement, certified by Lessee, accepting each of the
Approved Engineer’s repair recommendations for Lessor’s review and approval, which review and
approval shall not be unreasonably withheld, conditioned or delayed. If Lessor reasonably
determines, based on the advice of Lessor’s Engineer, that all or a portion of the revised piers
repair plan is not approved, then Lessor shall set forth the reasons therefor (which shall be
consistent with Lessee’s Use of the Premises) and shall provide Lessee with a copy of the Lessor’s
Engineer’s report upon which such determination is based, and shall make Lessor’s Engineer
available to meet with the Approved Engineer to discuss same, and Lessee shall thereafter be
provided the opportunity to modify the recommended piers repair plan so as to address the reasons
for such disapproval and resubmit same for review and approval by Lessor, which approval shall
not be unreasonably withheld, conditioned or delayed. It is understood and agreed that, in the event
of an unresolvable difference between the Approved Engineer and Lessor’s Engineer, then
Lessor’s reasonable determination shall be final, provided that it is based on Lessee’s Use of the
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Premises. As approved by Lessor, the piers repair plan shall be an “Approved Repair Plan.” Lessor
and Lessee concur that the revised Chelsea Piers Repair Plan approved by Lessor which shall be
the Approved Repair Plan represents a baseline and guide for the Pier Repair Work that Lessee
shall be obligated to carry out in accordance with this Section 10.9. The obligations of the parties
and limitation on liability with respect to Lessor’s comments, if any, shall be the same as those set
forth in Section 10.9(c). To the extent that the Pier Repair Work undertaken pursuant to such
Approved Repair Plan constitutes Capital Improvements, Lessor’s approval of such Pier Repair
Work shall satisfy the consent requirements of Section 11.1 of this Lease.
(e) Upon Lessor’s approval of an Approved Repair Plan, Lessee shall commence, and
continuously and diligently, subject to the Requirements and all related permit and approval
conditions, and subject to Unavoidable Delays, undertake to perform the Pier Repair Work
identified in such Approved Repair Plan, as the same may be modified by Lessee from time to
time with approval of Lessor (which approval shall not be unreasonably withheld, conditioned or
delayed). Lessee shall provide to Lessor annually, or more frequently as Lessor may reasonably
request (provided, however, that such requests shall not be more frequent than quarterly), the
following to be prepared and completed at Lessee’s sole cost and expense:
(i) Copies of all approvals and permits relating to the Pier Repair Work;
(ii) Copies of bid document(s) and/or work contract(s), the scopes of work and
and/or purchase orders for construction services, together with all material amendments,
significant change orders or material modifications to such agreements and contractor invoices;
(iii) Advance notice of not less than fifteen (15) days of the commencement date
of work under each new Pier Repair Work contract;
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(iv) Notification of the date of completion of the Pier Repair Work;
(v) Plans and specifications and, upon completion, “As-Built” drawings for
completed Pier Repair Work;
(vi) Copies of work-in-progress inspection reports together with certification of
the Approved Engineer that the Pier Repair Work was performed in a good and workmanlike
manner and in accordance with the plans and specifications, and that all materials and equipment
incorporated into the Premises as part of such Pier Repair Work is new (unless otherwise indicated
in such plans and specifications), in good condition, fully operational, without defects, and
substantially in accordance with such plans and specifications;
(vii) Certification by Lessee that, to the best of its knowledge, the Pier Repair
Work completed as of the date of such Certificate was performed in accordance with the
Requirements;
(viii) Copies of all guarantees and warranties (if any) on labor, materials and
equipment in accordance with the applicable plans and specifications to the extent generally
available within the relevant industry for similar work (to the extent that any such guarantees or
warranties exist and are deemed assigned to Lessor, Lessor confirms that Lessee shall have the
right to enforce the same at Lessee’s cost); and
(ix) Such other documentation that Lessor may reasonably request confirming
that the completed Pier Repair Work was undertaken and paid for in accordance with the
requirements of this Section 10.9.
Lessee shall provide the foregoing documentation to Lessor annually, or more frequently
as Lessor may reasonably request (provided, however, that such requests shall not be more
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frequent than quarterly). During the period covered by an Approved Repair Plan, compliance by
Lessee with this Section 10.9(e) shall, unless unforeseen events occur or are discovered, constitute
compliance by Lessee with the requirements of Section 10.1(a) of this Lease with respect to the
marine substructure components of the Premises.
(f) The last Comprehensive Inspection report and Approved Repair Plan shall be
prepared such that it may be approved by Lessor not earlier than two (2) years prior to the
expiration of the Term of this Lease, and shall specify all Pier Repair Work that must be completed
prior to the end the Term of this Lease based on Lessee’s Use of the Premises (the “Final Pier
Repair Program”). The Final Pier Repair Program shall be prepared such that, upon completion,
marine substructure elements deemed necessary by the Approved Engineer to support uses
identified in the Loading Plan for Lessee’s Use then in effect are reasonably expected to be rated
under the NYCEDC Guidelines Manual as either “Minor” or “Moderate,” and thereby meet the
good and safe order condition standard set forth in Section 10.1(a) based on Lessee’s Use of the
Premises. Lessee shall provide work-in-progress and certification of completion of such Pier
Repair Work to Lessor prior to Lease expiration. Upon acceptance and approval by Lessor (such
approval not to be unreasonably withheld, conditioned or delayed), the Pier Repair Work
completed pursuant to the Final Pier Repair Program shall be deemed to satisfy the requirement of
Section 29.1 with regard to marine structures portion of the Premises.
(g) Lessee shall, from time to time, and subject to Lessor’s approval (which approval
shall not be unreasonably withheld, conditioned or delayed), amend the Loading Plan in the event
that there is a material change in use, improvements made and/or equipment installed that alters
loading of the marine structures. In addition, Lessee may from time to time, subject to Lessor’s
approval (which approval shall not be unreasonably withheld, conditioned or delayed), amend the
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Approved Repair Details to reflect technological advances, experience at the Premises with regard
to the efficacy of such details, or successful application of new or alternative repair details at other
piers of similar construction and conditions as long as such advances or alternatives achieve the
same objective.
(h) At all times, Lessee shall adhere to good engineering practices and the industry
standards set forth in the NYCEDC Guidelines Manual with respect to the marine inspections (both
Comprehensive Inspections and interim inspections). The NYCEDC Guidelines Manual (as the
generally applicable provisions of such manual may be updated by New York City Economic
Development Corporation (or successor entity)) shall be the controlling reference document with
regard to such inspections unless Lessee and Lessor agree in a signed writing upon a successor or
replacement reference document, or, with respect to a specific item or interpretation, both the
Approved Engineer and Lessor’s Engineer, are in agreement.
(i) Should a condition arise that requires Lessee to undertake Pier Repair Work on an
emergency basis for which the advance notification requirement set forth in Section 10.9(e)(iii) is
not possible to satisfy, then Lessee shall provide notice to Lessor as soon as practicable after Lessee
has knowledge of such emergency condition stating (x) the nature of the emergency condition and
the reason as to why advance notice was not possible, and (y) a scope of work of such emergency
repairs. Upon completion of such emergency Pier Repair Work, Lessee shall provide notice to
Lessor of the scope of completed work, together with a certification by the Approved Engineer
with respect to such work prepared in accordance with Section 10.9(e)(v).
(j) In accordance with its rights under the Lease, Lessor reserves the right at Lessor’s
cost to inspect the Pier Repair Work in progress and at completion. Lessee will ensure that Lessor
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and/or its representatives are accorded access to the Premises and all Pier Repair Work areas at
reasonable times and on reasonable notice for the purpose of conducting such inspections.
(k) Each Approved Engineer’s contract and each construction contract (as the case may
be) entered into in connection with any Pier Repair Work must state that the Approved Engineer
and/or construction contractor will look only to Lessee for payment, and that neither the
construction contractor nor the Approved Engineer shall commence any legal proceeding against
Lessor, the State of New York or the City of New York to recover any compensation which may
be payable under the construction contract or Approved Engineer’s contract (provided that no
construction contractor shall be required to waive any applicable statutory mechanics’ or similar
lien rights).
(l) The Loading Plan for Lessee’s Use shall be modified and corrected from time to
time by Lessee based on then current Lessee’s Use of the Premises or additional survey and
engineering data, or as mutually agreed by the Approved Engineer and Lessor’s Engineer, subject
in each case to Lessor’s approval (such approval not to be unreasonably withheld, conditioned or
delayed to the extent that there is not a material change that reduces the loading figures in the
Loading Plan).
(m) The Approved Engineer may be replaced by another Approved Engineer selected
by Lessee with the approval of Lessor, such approval not to be unreasonably withheld, conditioned
or delayed.
(n) The requirements set forth in Article 11 of the Lease applicable to Capital
Improvements, including, but not limited to, the insurance requirements pursuant to Section
11.1(m), shall apply equally to the Pier Repair Work, except (i) as otherwise set forth in this
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Section 10.9 and (ii) that Lessee shall not be required to carry “builder’s risk” insurance with
respect to Pier Repair Work.
(o) Lessee also agrees to provide Lessor with access to the Premises, subject to the
rights of Occupants, to the extent such access is needed by Lessor to conduct inspections, repairs
and construction to the adjacent Pier 62 or to redevelop Pier 62. Lessor shall use commercially
reasonable efforts to conduct any such inspections or repairs in a manner that does not materially
impede or restrict pedestrian access to the Premises, and Lessor shall prosecute to completion any
such inspections or repairs in a diligent manner so as to not unduly prolong the adverse effects on
Lessee, Occupants and their invitees of such inspections and repairs, but Lessor shall not be
obligated to perform such work on an overtime or other premium basis. Lessor shall provide
Lessee with advance notice of all such work and will prepare a logistics plan to share with Lessee
that will minimize impacts to the Premises to the extent practicable, including access by the public
to the Premises.
CHANGES, ALTERATIONS AND ADDITIONS
Section 11.1. (a) Lessee shall not, and shall contractually require each Occupant that
enters into an Occupancy Agreement after the Commencement Date not to, make changes,
additions or improvements to the Premises except in compliance with the terms of this Agreement
and the Requirements.
(b) As used in this Agreement, the term “Capital Improvement” means any
construction or reconstruction in or on the Premises that (i) changes structural support or load
bearing elements and has a construction cost in excess of Seven Hundred Fifty Thousand Dollars
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($750,000.00), or (ii) materially changes the bulk, or height or modifies the footprint of the
Existing Improvements as the same may be hereafter modified (or of any Improvements hereafter
constructed on the Premises), or (iii) materially affects the exterior appearance of the
Improvements, or (iv) materially affects the Public Access Improvements once constructed in
accordance with Section 9.1 (other than on a temporary basis to permit the construction of a Capital
Improvement or a Non-Approvable Construction Project that is being undertaken in accordance
with the requirements of this Lease), or (v) is undertaken in connection with a Use Modification
as set forth in Section 21.1(s). As used in this Agreement, the term “Non-Approvable Construction
Project” means any construction in or on the Premises that does not constitute a Capital
Improvement and includes any replacement-in-kind or repair of an Existing Improvement or
previously completed Capital Improvement that does not exceed the scope or size of such Existing
Improvement or previously completed Capital Improvement.
(c) Not less than ten (10) Business Days prior to undertaking any individual change,
addition or improvement to the Premises the cost of which is estimated to exceed $750,000 or the
construction of which requires a construction permit issued by the New York City Department of
Buildings or approval by another Governmental Authority (other than any such change, addition
or improvement that consists primarily of a replacement or repair of an existing improvement to
the Premises that does not exceed the scope or size of the improvement being repaired or replaced
and that does not otherwise constitute a “Capital Improvement” described in clauses (i)-(iv) of the
definition of such term in Section 11.1(b)), Lessee shall notify Lessor as to the nature of such
change, addition or improvement and state whether such work is, in the reasonable determination
of Lessee, a Capital Improvement or a Non-Approvable Construction Project. Lessor reserves all
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rights hereunder should it disagree with Lessee’s determination. Should such work be a Capital
Improvement, Lessee shall thereafter (or simultaneously therewith) comply with Section 11.1(e).
(d) Lessor and Lessee acknowledge that (i) Lessor’s consent for (to the extent required
hereunder), and Lessee’s performance of, the initial construction of Public Access Improvements
are governed in accordance with the applicable provisions of Article 9, and (ii) Lessor’s consent
for (to the extent required hereunder), and Lessee’s performance of, repairs are governed in
accordance with the applicable provisions of Article 10.
(e) Prior to commencement of construction of any portion of construction of any
Capital Improvements, Lessee shall submit to Lessor plans and specifications for such Capital
Improvements for Lessor’s approval. If Lessor denies approval of the plans and specifications for
a Capital Improvement, Lessor shall so notify Lessee, specifying its objections in reasonable detail
and Lessee shall either (I) abandon the proposed Capital Improvement, or (II) revise the same so
as to meet Lessor’s objections, or (III) provide such additional information as Lessor determines
to be reasonably necessary to complete its review, and if Lessee elects to not abandon the proposed
Capital Improvement, Lessee shall thereafter submit to Lessor such revision or such additional
information as Lessor determines to be reasonably necessary to complete its review. Alternatively,
Lessor shall so notify Lessee of its approval of the proposed Capital Improvement. Each review
by Lessor shall be carried out within fifteen (15) Business Days after the date of submission in the
case of the initial plans and specifications by Lessee or within ten (10) Business Days after the
date of Lessee’s submission, in the case of any resubmission of revised plans and specifications
requested by Lessor designed to meet Lessor’s objections to initial plans and specifications, or of
additional information determined to be necessary by Lessor. If Lessor does not notify Lessee of
its determination within such fifteen (15) Business Day or ten (10) Business Day period (as
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applicable), Lessee may give Lessor a notice of such failure stating that if Lessor fails within five
(5) additional Business Days to approve or disapprove (along with reasons for any disapproval)
Lessor shall be deemed to have approved the plans and specifications in substantially the form
submitted by Lessee. Lessee’s notice shall contain the following legend on the top of the notice:
“FAILURE TO RESPOND TO THIS NOTICE WITHIN FIVE BUSINESS DAYS OF RECEIPT
WILL RESULT IN LESSOR’S CONSENT BEING DEEMED TO HAVE BEEN GRANTED”.
Further, the Lessor approval under this Article 11 shall not be unreasonably withheld, conditioned
or delayed to the extent that the proposed Capital Improvement complies with City of New York
Department of Buildings codes and regulations, all other Requirements of Governmental
Authorities and the terms and conditions of this Lease, and does not, in the reasonable
determination of Lessor, materially adversely affect structural support or load bearing elements at
the Premises, use of the Public Access Improvements (other than on a temporary basis to permit
the construction), or the exterior appearance of the Improvements.
(f) The final contract plans and specifications for a Capital Improvement that have
been approved or deemed to have been approved, as the same may be changed from time to time
by Lessee to the extent such changes are required to be approved by Lessor and are so approved
as hereinafter provided, are hereinafter referred to as the “Construction Documents.” In no event
shall Lessee commence construction of any portion of any Capital Improvement until the
Construction Documents for such portion have been approved or deemed approved by Lessor
pursuant to the provisions of this Article 11.
(g) If Lessee wishes to modify the Construction Documents for a Capital Improvement
in any material way after approval, Lessee shall submit the proposed modification to Lessor for
approval prior to implementing any such modification. All modifications shall be highlighted and
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identified in reasonable detail. Lessor shall review the proposed changes as if such were an original
submission of final contract plans and specifications under Section 11.1(e) above, and the
provisions thereof governing such a submission and approval or deemed approval shall apply.
(h) No Capital Improvement or Non-Approvable Construction Project shall be
undertaken unless and until Lessee shall procure from all Governmental Authorities and pay for,
as and when required, all permits, consents, certificates and approvals for the proposed Capital
Improvement or Non-Approvable Construction Project that are required to be obtained prior to the
commencement of the proposed Capital Improvement or Non-Approvable Construction Project
(collectively, “Improvement Approvals”). Lessor shall join and otherwise cooperate in the
application for any such Improvement Approvals, provided such application is made without cost
or expense to Lessor and does not impose on Lessor greater obligations than customary and
necessary to obtain the applicable permit, consent, certificate or approval. True copies of all such
Improvement Approvals and applications therefor shall be delivered by Lessee to Lessor prior to
commencement of the proposed Capital Improvement or Non-Approvable Construction Project.
(i) All Capital Improvements shall be carried out under the supervision of a licensed
New York architect with experience undertaking projects of similar scope and scale selected by
Lessee whose name, firm and qualifications shall be provided to Lessor within thirty (30) days of
selection by Lessee. Upon completion of any Capital Improvement or Non-Approvable
Construction Project, Lessee shall furnish to Lessor a complete set for “as-built” plans for such
Capital Improvement or Non-Approvable Construction Project and, where applicable, a survey
showing the addition of the Capital Improvement or Non-Approvable Construction Project,
together with a temporary or permanent Certificate of Occupancy therefor to the extent required
or obtained. Notwithstanding the foregoing, Lessee shall not be obligated to provide a survey for
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a Non-Approvable Construction Project unless same would ordinarily be obtained in connection
with sound construction practice.
(j) All Capital Improvements or Non-Approvable Construction Projects, when
completed, shall be of such a character as not to reduce the value of the Premises below the value
thereof immediately before construction of such Capital Improvement or Non-Approvable
Construction Project.
(k) All Capital Improvements and all Non-Approvable Construction Projects shall be
made with reasonable diligence and continuity, and in a good and workmanlike manner and in
compliance with the requirements of this Agreement.
(l) The Construction Documents shall comply with the Requirements. The
responsibility to assure such compliance shall be Lessee’s; Lessor’s approval of the Construction
Documents shall not be, nor shall it be construed to be or relied upon as, a determination that the
Construction Documents comply with the Requirements. If there is a conflict between the
Requirements and the Construction Documents, the Requirements shall prevail.
(m) No construction of any Capital Improvement or Non-Approvable Construction
Project shall be commenced until Lessee delivers to Lessor original insurance policies, or
certificates of insurance with respect to such policies together with copies of such policies, issued
by responsible insurers, bearing notations evidencing the payment of premiums or installments
thereof then due or accompanied by other evidence satisfactory to Lessor of such payments, for
the insurance specified in Exhibit F annexed hereto, unless Lessor reasonably determines that the
Capital Improvement or Non-Approvable Construction Project does not warrant the insurance
required by such Exhibit, in which case Lessor shall, in its discretion, specify such acceptable
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lesser types and levels of insurance appropriate to such Capital Improvement or Non-Approvable
Construction Project. If, under the provisions of any Casualty, liability or other insurance policy
or policies then covering the Premises or any part thereof, any consent to such Capital
Improvement or Non-Approvable Construction Project by the insurance company or companies
issuing such policy or policies is required to continue and keep such policy or policies in full force
and effect, Lessee, prior to the commencement of construction of such Capital Improvement or
Non-Approvable Construction Project shall obtain such consents and pay any additional premiums
or charges therefor that may be imposed by said insurance company or companies. To the extent
that the insurance coverage required pursuant to this Section 11.1 duplicates that required by
Article 5 and Exhibit F, Lessee shall not be required to maintain such coverage in duplicate, but in
such instance the more extensive coverage shall be maintained.
(n) If Lessee elects to procure payment and/or performance bonds, Lessee shall provide
Lessor with copies of such bonds.
Section 11.2. Except for Trade Fixtures, all Capital Improvements, all Non-Approvable
Construction Projects and all materials to be incorporated in the Improvements at any time during
the Term shall, upon purchase or construction of the same and at all times thereafter, constitute the
property of the Lessor, and upon construction of each Capital Improvement and each Non-
Approvable Construction Project, including the incorporation of such materials therein, title to the
Lessee Improvements and such material shall vest in the Lessor; provided, however, that (i) the
Lessor shall not be liable in any manner for payment or otherwise to any contractor, subcontractor,
laborer or supplier of materials or other Person in connection with the purchase of any such
materials, (ii) the Lessor shall have no obligation to pay any compensation to Lessee by reason of
its acquisition of title to such materials and Lessee Improvements, (iii) the Lessor shall have no
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obligation with respect to the storage or care of such materials or the Improvements, and (iv) all
materials to be incorporated in the Improvements shall, immediately upon the purchase of the
same, be deemed to be leased to Lessee pursuant to this Lease. The foregoing provisions are
subject to the terms of Section 39.19.
Section 11.3. All Construction Agreements, including all agreements for the construction
of any Non-Approvable Construction Projects other than those relating to Trade Fixtures shall
include the following provision: “[contractor] [subcontractor] [materialman] hereby agrees that
immediately upon the purchase by [Lessee] from the [contractor] [subcontractor] [materialman]
of any building materials to be incorporated in the Improvements (as said term is defined in the
lease pursuant to which the owner acquired a leasehold interest in the property), or of any building
materials to be incorporated in improvements made thereto, and, in each case, the payment
therefor, such materials shall become the sole property of [the Lessor], notwithstanding that such
materials have not been incorporated in, or made a part of, such Improvements at the time of such
purchase; provided, however, that [the Lessor] shall not be liable in any manner for payment or
otherwise to [contractor] [subcontractor] [materialman] in connection with the purchase of any
such materials and [the Lessor] shall have no obligation to pay any compensation to [contractor]
[subcontractor] [materialman] by reason of such materials becoming the sole property of [the
Lessor].”
Section 11.4. Lessee may furnish and install a project sign, designed, of a size and with
such text as is reasonably satisfactory to Lessor, at a location on the Premises reasonably
satisfactory to Lessor and Lessee. Such project sign and any other signs shall conform to applicable
Requirements.
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Section 11.5. No Capital Improvement or Non-Approvable Construction Project shall
overload any floor, roof, land surface, bulkhead, pavement, landing, pier or wharf on the Land and,
if such covenant is breached, Lessee shall repair, replace or rebuild any of the foregoing, including,
but not limited to, supporting members damaged by overloading.
Section 11.6. (a) Notwithstanding any provision of this Lease to the contrary, the
work of construction, maintenance, repair and renewal of any Capital Improvement shall be done
at such time and in such manner as is reasonably satisfactory to Lessor. Lessor or its designees,
may, at any time and from time to time, upon prior notice to Lessee and during regular business
hours except in the case of emergency, inspect such construction, maintenance, repair and renewal
work of any Capital Improvement to determine if such work is being performed in accordance
with the terms of this Lease, and Lessee and its employees, agents, contractors and subcontractors
shall cooperate with Lessor in the performance of such inspection. Lessee, at its sole expense, shall
make all necessary provisions to protect the existing piers, pier supports, ballast, walls, duct lines,
drainage lines and other similar facilities located beneath or about the Premises (or to provide for
their replacement or upgrading) during the course of construction of any Capital Improvement and
any Non-Approvable Construction Project. After completion of any Capital Improvement, Lessee
shall not interfere with the location or use thereof without the prior approval of Lessor. Lessor, in
approving any plans, drawings or specifications for any manner of performing the work or
materials used by Lessee, its contractors, subcontractors or agents, does not assume any
responsibility or liability with respect to their safety, sufficiency or otherwise, whether apparent
on their face or otherwise, which responsibility or liability shall be and remain with Lessee.
(b) Except as expressly provided herein, all expenses incidental to the construction of
any Capital Improvements and any Non-Approvable Construction Project covered by this Lease
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(excluding in the case of Capital Improvements Lessor’s costs in reviewing plans and
documentation and inspecting construction) shall be borne solely by Lessee and/or its Occupants.
Section 11.7. Notwithstanding anything hereinabove set forth to the contrary, in addition
to Non-Approvable Construction Projects, Lessee at Lessee’s sole cost and expense, shall be
permitted to perform alterations comprised of ordinary repairs, maintenance, minor landscaping
and purely decorative changes to the Premises (collectively, “Decorative Changes”) without the
prior consent of Lessor and without prior notice to Lessor. For purposes of this Lease, Decorative
Changes shall include, without limitation, painting of the exterior of the Premises in a color that is
approved by Lessor (such approval not to be unreasonably withheld, conditioned or delayed) and
the installation or removal of Trade Fixtures, items of furniture, furnishings, decorations,
temporary wall partitions, wall and floor coverings, window treatments, and other nonstructural
finish work. If authorized by Lessee, Occupants shall also have the right to undertake a Non-
Approvable Construction Project and provide Decorative Changes in the interior of their individual
premises without prior consent of Lessor provided such Non-Approvable Construction Projects
are performed in compliance with the provisions of this Article 11. The term “Capital
Improvements” as used in this Lease shall not be deemed to include the performance of any
Decorative Changes or any Non-Approvable Construction Projects.
Section 11.8. No nuclear, hazardous, highly flammable, explosive or dangerous liquids or
materials shall be permitted to be used or stored by Lessee in the Improvements except with respect
to any parking or storage of watercraft or motor vehicles or marine fueling (which fueling can only
be done by a bunker barge and not from the pier, and which is in any event subject to applicable
permits), and services incidental thereto, the use and storage of natural gas and heating oil, in each
case solely for purposes of heating the Improvements, and materials reasonably necessary for the
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construction or erection of the Lessee Improvements or the operation of any Lessee business and
any restaurant facilities, and then only if stored, handled or used in strict compliance with the
applicable fire code of any Governmental Authority having jurisdiction thereof, as well as by fire
insurance underwriters as now written or hereafter amended. Lessee shall include in any
Occupancy Agreement entered into after the Commencement Date a provision requiring that no
nuclear, hazardous, highly flammable, explosive or dangerous liquids or materials shall be
permitted to be used or stored by the Occupant in the Improvements except with respect to any
parking or storage of watercraft or motor vehicles and services incidental thereto, the use and
storage of natural gas and heating oil, in each case solely for purposes of heating the Improvements,
and materials reasonably necessary for the construction or erection of the Lessee Improvements or
the operation of any Occupant’s business and any restaurant facilities, and then only if stored,
handled or used in strict compliance with the applicable fire code of any Governmental Authority
having jurisdiction thereof, as well as by fire insurance underwriters, as now written or hereafter
amended.
Section 11.9. (a) Lessee shall develop and implement a Signage Plan in accordance with
this Section 11.9 for public facing locations at the Premises, including but not limited to the Public
Access Areas, that identifies and promotes Lessee and the permitted uses set forth in Article 21,
and presents other public information reasonably necessary for the operation of the Premises
pursuant to this Lease, all in a manner compliant with the Operating Standard and appropriate to a
public park setting (as opposed to a commercial mall, highway commercial strip, or business
streetscape setting). Accordingly, the Signage Plan developed by Lessee shall provide
consideration to the design, placement, materials, quality and care of such signage, and shall utilize
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a uniform design approach for such signage that complements, and does not detract from, the high-
quality uses at the Premises and surrounding Park areas.
(b) As of the Execution Date, the existing public facing signage at the Premises is as
shown in Exhibit J-1 attached hereto (“Existing Signage”). Following the Commencement Date,
Lessee may continue to maintain, refurbish and replace the Existing Signage in accordance with
the time frames set forth in this Section 11.9. Until such date upon which Lessor approves the
Signage Plan in accordance with Section 11.9(c), Lessee shall have the right without Lessor’s
approval to place, refurbish and replace public facing signage on an interim basis in a manner that
is consistent with the design, materials, dimensions and placement of the Existing Signage. Lessee
agrees that such interim signage shall have no precedential value in Lessor’s review and approval
of the Signage Plan as set forth herein, and Lessee acknowledges and agrees that such interim
signage may be required to be modified, removed, or replaced in whole or in part in order for
Lessee to comply with the Signage Plan. Notwithstanding anything to the contrary contained
herein, all public facing signage placed on or attached to the southern wall of the Headhouse
building shall require the approval of Lessor to the extent that such signage does not (i) consist of
identification signage with the Chelsea Piers name and/or logo or (ii) from and after the date that
the Signage Plan is approved by Lessor, conform to the requirements of the Signage Plan.
(c) Within six (6) months after the Execution Date, Lessee shall retain and thereafter
direct, at its sole cost and expense, an experienced signage consultant with demonstrated expertise
in creating high quality uniform signage plans for large public facing mixed-use facilities. Based
upon the recommendations of such signage consultant, Lessee shall, within one (1) year of the
Execution Date, provide draft comprehensive signage guidelines for Lessor’s review and approval,
which approval shall not be unreasonably withheld, conditioned or delayed (upon Lessor’s
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approval, the “Signage Plan”, which shall be appended to and incorporated herein as Exhibit J-2
once approved by Lessor). In preparing the Signage Plan, Lessee shall not rely upon the design
and placement of signs used by other tenants of Lessor within the Park as a precedent for Lessor’s
approval of the Signage Plan under this Section 11.9(c). Exhibit J-2A attached hereto depicts
preliminary locations and dimensions for signs that identify Lessee, its Subtenants/Occupants, and
provide wayfinding for Public Access Areas that shall be considered in the development of the
Signage Plan, and Exhibit J-2A shall be replaced in its entirety upon the approval of the Signage
Plan as Exhibit J-2. The Signage Plan shall include at a minimum: (a) identification of dimensions,
locations, and uniform design standards such as font, color and materials for Lessee’s and its
Subtenants/Occupants’ identifications; (b) wayfinding signs for the Public Access Areas using
standards that conform to public use signage elsewhere in the Park, which shall include
identification of “Hudson River Park” in such signage; and (c) signage related to vehicular and
pedestrian safety and regulation, including by way of example locations for passenger pick up and
drop off, crosswalks and vehicular circulation consistent with the Traffic and Pedestrian
Management Plan. In addition, and without limitation to the foregoing, the Signage Plan shall
limit any signage that faces south of the Premises to (i) a “Chelsea Piers” identification (including
identity signage with the name and logo of Lessee but not the identity of Subtenants and Occupants
or third-party sponsors), or (ii) a park or a sports/recreation graphic.
(d) Following the date upon which Lessor approves the Signage Plan, as Existing
Signage is replaced, relocated or modified, or as new signage is erected, such signage shall be
installed and maintained, at Lessee’s sole cost and expense, in accordance with the Signage Plan.
(e) Within seven (7) years after the date upon which Lessor approves the Signage Plan,
Lessee shall fully implement the Signage Plan such that (i) all additional signage specified in the
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Signage Plan is installed, and (ii) all Existing Signage that does not conform to the Signage Plan
is removed or replaced with signage that does so conform; provided that Lessee shall implement
the new supergraphic sign improvement on the south wall of the Existing Improvements that is
contemplated by the Signage Plan no later than sixty (60) days after the date on which the Baseline
Public Access Improvements are completed (or, if later, the date that is thirty (30) days after the
date on which the Signage Plan is approved in accordance with Section 11.9(c)).
(f) Notwithstanding anything contained herein to the contrary, signage facing south of
the Premises shall be compliant with Section 11.9(b) or (from and after the date on which the
Signage Plan is approved by Lessor) the Signage Plan.
(g) All signage shall be maintained in a good, clean and safe condition throughout the
Term including Existing Signage until such time as it is replaced or removed. Lessee shall be
responsible for complying with all applicable Requirements and obtaining all permits and
approvals necessary for the installation and maintenance of all signs.
(h) Notwithstanding anything contained herein to the contrary, Lessee shall install and
maintain any signage or notices required by Governmental Authorities.
(i) Other than as provided for herein, Lessee shall not erect any advertising or other
signage or notices that are public facing without the prior written consent of Lessor, which consent
shall be in Lessor’s sole but reasonable determination.
(j) Lessee may, upon not less than sixty (60) days written notice to Lessor, propose to
amend or modify the Signage Plan. Such proposed amendment or modification shall be subject to
Lessor’s prior written approval in its sole but reasonable determination. Lessor shall not be deemed
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to be acting unreasonably if it determines that Lessee’s proposed amendment or modification is
inconsistent with the objectives and intent of this Article 11.
(k) Should Lessee fail to comply (i) with the Signage Plan or (ii) with the signage
requirements as set forth in this Lease (including of any applicable Requirement), Lessor shall
notify Lessee in writing with specificity of any signage that is not in compliance with this Lease,
and Lessee, at Lessee’s sole cost and expense, shall remove the non-compliant sign from the
Premises within fourteen (14) days of Lessor’s Notice. Lessee’s failure to remove the non-
compliant sign within the time period provided in Lessor’s Notice shall be an Event of Default
under Section 22.1 of this Lease and Lessor shall have all remedies available to it as set forth in
Article 22.
REQUIREMENTS
Section 12.1. Lessee promptly shall comply with all Requirements affecting the Premises
(including the sidewalks comprising a part thereof and/or any vault in or under the same) or
requiring the removal of any encroachment onto the adjoining premises, or affecting the
construction, maintenance, use, operation, management or occupancy of the Premises,
extraordinary as well as ordinary, and whether or not the same involve or require any structural
changes or additions in or to the Premises but only to the extent they are necessary to allow
Lessee’s use of the Premises. Lessee also shall comply with all provisions and requirements of any
Casualty, liability or other insurance policy required to be carried by Lessee under the provisions
of this Lease.
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Section 12.2. To the extent permitted by law, Lessee shall permit the use of the Premises
and the berthing area at any time and from time to time (a) for the installation, maintenance and
operation of such navigation lights as may be required by the United States Coast Guard or other
Governmental Authority having jurisdiction, and (b) by Lessor in connection with the installation
of camera or other transmitting equipment used to enhance park security. The sole cost to be
incurred by Lessee hereunder shall be to furnish such electricity as may be required.
Section 12.3. At the request of Lessee, Lessor, at Lessee’s sole cost, shall within ten (10)
Business Days of Lessee’s request, execute and deliver any documents reasonably required on its
part in order for Lessee to comply with all present and future Requirements applicable to the use
and operation of the Improvements in conformity with this Lease and of the business of Lessee,
provided such documents are and do not impose on Lessor more or greater obligations than
customary and necessary in order to comply with the applicable Requirements, or that are the
obligations of Lessee pursuant to this Lease.
EQUIPMENT
Section 13.1. All Equipment shall be and shall remain the property of Lessor. Lessee
shall not have the right, power or authority to, and shall not, remove any Equipment from the
Premises without the consent of Lessor, which consent shall not be unreasonably withheld,
provided, however, such consent shall not be required in connection with repairs, cleaning or other
servicing (which shall be at Lessee’s sole expense), or if the same is promptly replaced by
equipment that is at least equal in utility and value to the Equipment being removed.
Notwithstanding the foregoing, Lessee shall not be required to repair or replace any Equipment
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that performed a function that has become obsolete or otherwise is no longer necessary or desirable
in connection with Lessee’s use or operation of the Premises and Lessee shall be solely responsible
for the removal of such obsolete Equipment in compliance with applicable Requirements, unless
such failure to repair or replace such Equipment would reduce the value of the Premises as used
by Lessee or would result in a reduced level of maintenance of the Premises, in which case Lessee
shall be required to install such Equipment as may be necessary to prevent such reduction in the
value of the Premises or in the level of maintenance.
Section 13.2. Subject to the provisions of Section 13.1, Lessee shall keep all Equipment
in good order and repair, ordinary wear and tear excepted, and shall replace the same, at Lessee’s
sole expense, when necessary with items at least equal in utility and value to the Equipment being
replaced.
DISCHARGE OF LIENS; BONDS
Section 14.1. Subject to the provisions of this Lease, Lessee shall not create or cause to
be created any lien, encumbrance or charge upon the Premises or any part thereof, the income
therefrom or any assets of, or funds appropriated to, Lessor, and Lessee shall not suffer any other
matter or thing whereby the estate, right and interest of Lessor in the Premises or any part thereof
might be impaired.
Section 14.2. If any mechanic’s, laborer’s, vendor’s, materialmen’s or similar statutory
lien (other than a lien arising out of any work performed by Lessor) at any time is filed in violation
of the obligations of Lessee pursuant to Section 14.1, Lessee, within forty-five (45) days after
notice of the filing thereof, shall cause the same to be discharged of record by payment, deposit,
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bond, order of a court of competent jurisdiction or otherwise. If Lessee fails to cause such lien to
be discharged of record within the period aforesaid, and if such lien continues for an additional ten
(10) days after notice by Lessor to Lessee, then, in addition to any other right or remedy, subject
to any rights granted to a Mortgagee under this Lease, Lessor may, but shall not be obligated to,
discharge the same either by paying the amount claimed to be due or by procuring the discharge
of such lien by deposit or by bonding proceedings, and in any such event, Lessor shall be entitled,
if Lessor so elects, to compel the prosecution of an action for the foreclosure of such lien and to
pay the amount of judgment in favor of the lien with interest, cost and allowances. Any amount so
paid by Lessor, in connection with reasonable costs and expenses incurred by Lessor in connection
therewith, together with interest thereon at the Applicable Rate, from the respective date of
Lessor’s making of the payment or incurring of the costs and expenses, as the case may be, to the
date on which repayment of such amount is received by Lessor, shall constitute Rental and shall
be paid by Lessee to Lessor within ten (10) days after demand. Notwithstanding the foregoing
provisions of this Section 14.2, Lessee shall not be required to discharge any such lien if Lessee is
in good faith contesting the same and has furnished a cash deposit or a security bond or other such
security reasonably satisfactory to Lessor in an amount sufficient to pay such lien with interest and
penalties.
Section 14.3. Nothing contained in this Lease shall be deemed or construed in any way as
constituting the consent or request of Lessor, express or implied, by inference or otherwise, to any
contractor, subcontractor, laborer or materialman for the performance of any labor or the
furnishing of any materials for any specific alteration to or repair or improvement of the Premises
or any part thereof, nor as giving Lessee any right, power or authority to contract for or permit the
rendering of services or the furnishing of materials that would give rise to the filing of any lien
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against Lessor’s interest in the Premises or any part thereof, or any assets of, or funds appropriated
to, Lessor. Notice is hereby given, and Lessee shall cause all Construction Agreements to provide,
that Lessor shall not be liable for any work performed at the Premises for Lessee or any Sublessee
or for any materials furnished at the Premises for any of the foregoing, and that no mechanic’s or
other lien for such work or materials shall attach to the Premises or any part thereof, or any assets
of, or funds appropriated to, Lessor.
REPRESENTATIONS; POSSESSION
Section 15.1. Lessee hereby represents and warrants and, where applicable, covenants to
Lessor as of the Execution Date as follows:
(a) Incorporation, Good Standing and Due Qualification. Each of CPLP and NROC is
a limited partnership duly organized, validly existing and in good standing under the laws of the
State of New York, and has the power and authority to own its assets and to transact the business
in which it is now engaged or proposed to be engaged.
(b) Corporate Power and Authority; No Conflicts. The execution, delivery and
performance by Lessee of this Lease have been duly authorized by all necessary corporate or
limited liability company action and do not and will not: (i) require any consent or approval of the
partners of either CPLP or NROC that has not been received prior to the date of this Lease; (ii)
contravene the partnership agreement of CPLP or NROC; (iii) to the best of Lessee's knowledge,
constitute a violation on the part of Lessee of any provision of, or require any filing, registration,
consent or approval to be made or obtained by Lessee under, any law, rule, regulation, order, writ,
judgment, injunction, decree, determination or award presently in effect having applicability to
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Lessee; (iv) result in a breach on the part of Lessee of, or constitute a default by Lessee or require
any consent to be obtained by Lessee under any indenture or loan or credit agreement or any other
agreement, lease or instrument to which either CPLP or NROC is a party or by which either CPLP
or NROC or its properties are bound or affected; (v) result in, or require, the creation or imposition
of any lien, upon or with respect to any of the properties now owned or hereafter acquired by CPLP
or NROC other than (x) liens created by this Lease in favor of Lessor and (y) liens in favor of a
Mortgagee as permitted by this Lease; or (vi) to the best of Lessee's knowledge, cause Lessee to
be in default under any law, rule, regulation, order, writ, judgment, injunction, decree,
determination or award or any such indenture, agreement, lease or instrument.
(c) Legally Enforceable Agreements. This Lease is a legal, valid and binding
obligation of Lessee enforceable against Lessee in accordance with its terms, except to the extent
that such enforcement may be limited by bankruptcy, insolvency and other similar laws affecting
creditors’ rights generally.
(d) Litigation. There are no actions, suits or proceedings pending or, to the knowledge
of Lessee, threatened against, or adversely affecting either CPLP or NROC before any court,
Governmental Authority or arbitrator, which may, in any one case or in the aggregate, materially
adversely affect the financial condition, operations, properties or business of Lessee, or the ability
of Lessee to perform its obligations under this Lease.
(e) Taxes. Lessee has filed all tax (federal, state and local) returns required to be filed
(or has filed for an extension for the filing of any such tax returns, which extension has been
granted or is as-of-right) and has paid all taxes, assessments and governmental charges and levies
thereon to be due, including interest and penalties. Lessee has no knowledge of any claims for
taxes due and unpaid which might become a lien upon any of the assets of CPLP or NROC.
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(f) Operation of Business; Compliance with Laws. Lessee possesses or will possess
prior to the Commencement Date all material licenses, permits, franchises, patents, copyrights,
trademarks and trade names, or rights thereto, which are required to be obtained by Lessee in order
for Lessee to conduct its business substantially as presently conducted, and Lessee is not in
violation of any valid rights of others with respect to any of the foregoing. To the best of Lessee’s
knowledge, Lessee is in compliance in all material respects with all Requirements applicable to
the use of the Premises.
(g) Condition of the Premises. Lessee acknowledges that the Lessee is fully familiar
with the Land and the area underlying the Premises, the physical condition of such underlying
land, the Title Matters, the Zoning Regulations and the other Requirements.
(h) Subleases. As of the Execution Date, there are no Subleases, tenancies or
occupancies of any space in the Premises claiming by, under or through Lessee other than those
set forth in Exhibit D.
(i) No Brokers. Lessee has not dealt with any broker, finder or like entity in connection
with this Lease or the transactions contemplated hereby. Lessee shall hold Lessor harmless from
and against any and all claims for commission, fee or other compensation by any Person who
claims to have dealt with Lessee in connection with this Lease and for all costs incurred by Lessor
in connection with such claims, including, without limitation, reasonable attorney’s fees and
disbursements. This representation shall survive the expiration or earlier termination of this Lease.
(j) Ownership. The sole general partner of each of CPLP and NROC is Chelsea Piers
Management Inc., a New York corporation owned by Roland W. Betts, Tom A. Bernstein and
David A. Tewksbury.
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(k) No Insolvency. None of CPLP, NROC, Chelsea Piers Management Inc., nor any
shareholder of Chelsea Piers Management Inc. has filed for protection under the insolvency laws
of any jurisdiction or had an involuntary bankruptcy filing made against it or him.
(l) No Pledge. Chelsea Piers Management Inc. has not pledged or otherwise
encumbered and shall not pledge or otherwise encumber its interests in Lessee other than liens in
favor of a Mortgagee. Chelsea Piers Management Inc. shall not permit any of its shareholders to
pledge or otherwise encumber their direct or indirect interests in Chelsea Piers Management Inc.
other than liens in favor of a Mortgagee.
(m) No Undue Influence. No officer, agent, employee or representative of Lessor has
received any payment or other consideration from Lessee, Chelsea Piers Management Inc. or any
of its shareholders in connection with this Lease, and to Lessee’s knowledge without investigation
no officer, agent, employee or representative of Lessor has any interest, direct or indirect in Lessee,
in Lessee’s interest in this Lease, or the proceeds thereof. Lessee acknowledges that Lessor is
relying on the warranty and representation contained in this Section 15.1(m) and that Lessor would
not enter into this Lease absent the same. It is specifically agreed that, in the event the facts hereby
warranted and represented in this Section 15.1(m) prove to be incorrect, Lessor may declare that a
Default exists pursuant to Section 22.1(h), under this Lease in which case Lessee may cure such
default by removing such officer, member or employee of Lessee and causing such individual to
divest himself or herself from any interest in Lessee.
(n) Prohibited Parties. Neither Lessee nor Chelsea Piers Management Inc. is a
Prohibited Person.
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Section 15.2. Lessor hereby represents and warrants to Lessee, and, where applicable,
covenants to Lessee, as of the Execution Date as follows:
(a) Incorporation and Authority. Lessor is duly organized and validly existing under
the laws of the State of New York and has the full right, power, authority and legal capacity to
execute and deliver this Lease, to execute and deliver the instruments referred to herein, and to
enter into and fully perform the transactions contemplated hereby, or thereby;
(b) Actions and Consents. All actions and consents required by Lessor to authorize the
transactions contemplated by this Lease have been duly performed and obtained;
(c) Execution. All Persons who execute this Lease and the instruments contemplated
by this Lease on behalf of Lessor are duly authorized and empowered on behalf of Lessor to do so
and to enter into all transactions contemplated by this Lease, and by such instruments;
(d) No Conflict. The execution, delivery and consummation of the transactions
contemplated hereby and performance of this Lease have not and will not conflict with any
provisions of any Requirements to which Lessor is subject, or conflict with, result in any breach
of, or constitute a default under, any superior lease, mortgage, deed of trust, lease, bank loan or
credit agreement, corporate charter, bylaws or other instrument to which Lessor is a party or by
which Lessor or its assets may be bound or affected;
(e) Legally Enforceable Agreements. This Lease is a legal, valid and binding
obligation of Lessor, enforceable against Lessor in accordance with its terms, except to the extent
that such enforcement may be limited by applicable bankruptcy, insolvency and other similar laws
affecting creditors’ rights generally;
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(f) State Lease. Lessor has not entered into any document, instrument or agreement
other than the State Lease that makes this Lease or any of the rights of Lessee hereunder
subordinate to such document, instrument or agreement. Lessor has delivered to Lessee a true,
correct and complete copy of the State Lease. The State Lease is in full force and effect, Lessor
has not received any notice of default under the State Lease and the execution and delivery of this
Lease and Lessor’s performance of all obligations under this Lease (including, without limitation,
leasing the Premises until the Expiration Date) is authorized under the State Lease. Should any
amendment to the State Lease be entered into by Lessor and the State, or if the State should assign
to any assignee its rights under the State Lease, reasonably promptly after such amendment or after
Lessor receives a copy of such assignment, Lessor shall deliver to Lessee a true, correct and
complete copy of such amendment or assignment.
(g) No Brokers. Lessor has not dealt with any broker, finder or like entity in connection
with this Lease or the transactions contemplated hereby. Lessor shall hold Lessee harmless from
and against any and all claims for commission, fee or other compensation by any Person who
claims to have dealt with Lessor in connection with this Lease and for all costs incurred by Lessee
in connection with such claims, including, without limitation, reasonable attorney’s fees and
disbursements. This representation shall survive the expiration or earlier termination of this Lease.
Section 15.3. Lessor shall deliver possession of the Premises to Lessee on the
Commencement Date in its “as is” condition, subject to the Title Matters, and the use and
occupancy of portions of the Premises by Existing Tenants, as defined herein. Lessee accepts the
Premises in its existing condition and acknowledges that, except as otherwise expressly set forth
in this Lease, no representations, statements or warranties, express or implied, have been made by
or on behalf of Lessor in respect of the Premises, the status of title thereof, the Requirements
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applicable thereto, the physical condition of the underlying Land, or the use that may be made of
the Premises, and that except as otherwise expressly provided herein and, subject to Section 10.1,
Lessor shall in no event whatsoever be liable for any latent or patent defects in the Premises.
LESSOR AND/OR THE CITY AND/OR THE STATE
NOT LIABLE FOR INJURY OR DAMAGE
Section 16.1. Except as expressly set forth herein, none of Lessor, the City or the State
shall be liable for any injury, damage, loss or liability, direct or consequential, to Lessee or to any
Person happening on, in or about the Premises or its appurtenances, nor for any injury or damage,
direct or consequential, to the Premises, or to any property belonging to Lessee or to any other
Person, that may be caused by fire, by breakage, or construction on the Premises during the Term
(including, but not limited to, any of the common areas within the Improvements, Equipment,
elevators, hatches, openings, installations, stairways, hallways or other common facilities, or the
streets or sidewalks or waterway area within the Premises), or by the use, misuse or abuse of any
portion of the Premises, or that may arise from any other cause whatsoever, unless, and only to the
extent that such injury or damage is determined to be caused by (x) the negligence or intentional
misconduct of Lessor, the City or the State or their respective agents, employees or contractors or
(y) by Lessor, the City or the State or their respective agents, employees or contractors in the
conduct of activities described in Sections 18.1 through 18.3.
Section 16.2. Except as expressly set forth herein, none of Lessor, the City or the State
shall be liable to Lessee or to any other Person for any failure of water supply, gas or electric
current, nor for any injury or damage to any property of Lessee caused by or resulting from
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gasoline, oil, steam, gas, electricity, or hurricane, tornado, flood, wind or similar storm or
disturbance after the Commencement Date, or by or from water, rain or snow which may leak or
flow from the street, sewer, gas mains or subsurface area or from any part of the Premises, or body
of water under or adjacent to the Premises, or by or from leakage of gasoline or oil from pipes,
appliances, sewer or plumbing works therein, or from any other place, nor for interference with
light or other incorporeal hereditaments by any Person, or caused by any public or quasi-public
work, unless, and only to the extent that such failure, injury or damage is caused by Lessor, the
City or the State or their respective agents’, employees’ or contractors’ negligence, or intentional
tortious acts.
Section 16.3. None of Lessor, the City or the State shall be liable for any latent or patent
defect in the Premises.
Section 16.4. The State of New York, including its Office of Parks, Recreation and
Historic Preservation and its Department of Environmental Conservation, and the City of New
York are not parties to this Lease and in no way shall either be responsible to any party as lessor
under this Lease for any claims of any nature whatsoever arising or which may arise from this
Lease unless the State or the City expressly takes over this Lease as Lessor and then only as to
claims arising after such Lease is taken over by either New York State or New York City.
Section 16.5. In addition to the provisions of Section 16.1 and 16.2, in no event shall
Lessor in its capacity as Lessor be liable to Lessee or to any other Person for any injury or damage
to any property of Lessee or of any other Person or to the Premises, arising out of any sinking,
shifting, movement, subsidence or failure in the load-bearing capacity of, or other matter or
difficulty related to, the soil or other surface or subsurface materials of the land or waterways
underlying the Premises unless the same is caused by the gross negligence of Lessor or Lessor’s
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agents, employers, or officers occurring after the date of this Lease, it being agreed that except as
otherwise provided herein, Lessee shall assume and bear all risk of loss with respect thereto,
subject to Article 6 where applicable.
INDEMNIFICATION OF LESSOR, THE STATE AND OTHERS
Section 17.1. Lessee shall defend, indemnify and save the Hudson River Park Trust, the
State of New York, the City of New York, and each of their offices, departments, agencies,
officials, directors and employees (collectively, the “Indemnitees”) harmless from and against any
and all liabilities, suits, obligations, fines, damages, penalties, claims, out-of-pocket costs, charges
and expenses, including, without limitation, court costs and reasonable attorneys’ fees and
disbursements, by reason of any of the following, except to the extent caused (x) by a default by
Lessor under the terms of this Lease or the negligence or intentional misconduct of any Indemnitee
or (y) by Lessor, the City or the State or their respective agents, employees, or contractors in the
conduct of activities described in Sections 18.1 through 18.3:
(a) Construction of the Lessee Improvements or any other work performed by Lessee
or any Sublessee or Occupant or any agent, contractor or employee of Lessee, Sublessee or
Occupant;
(b) Any construction work or act done in, on, or about the Premises or any part thereof
by or on behalf of Lessee or any Sublessee or Occupant or any agent, contractor or employee of
Lessee, Sublessee or Occupant;
(c) The control or use, non-use, possession, occupation, alteration, repair, condition,
operation, maintenance or management of the Premises, or any part thereof, or of any street, alley,
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plaza, sidewalk, curb, vault, body of water, passageway or space comprising a part of the Premises
or adjacent thereto (provided same is the legal responsibility of Lessee) by Lessee or any Sublessee
or any Occupant or any agent, contractor or employee of Lessee, Sublessee or Occupant, including,
without limitation, any violations imposed by any Governmental Authorities in respect of any of
the foregoing;
(d) Any act on the part of Lessee or any of its partners, joint venturers, officers,
shareholders, directors, agents, contractors, servants, employees, Occupants or invitees when such
action is prohibited pursuant to the terms of this Lease, and any failure on the part of any such
parties to act when such action is required pursuant to the terms of this Lease;
(e) Any accident, injury (including death at any time resulting therefrom) or damage
to any Person or property occurring (i) in or on the Premises or any part thereof or (ii) in or on the
Right of Way Area or any area immediately adjacent thereto but for purposes of this subparagraph
(ii) only to the extent caused by the negligence or misconduct or omission of Lessee, any Sublessee
or any Occupant or any agent, contractor or employee of Lessee, Sublessee, or Occupant. Lessee’s
indemnification and defense obligations set forth in this Article 17 are not applicable to claims
related to Lessee’s conducting the Traffic Management Services within Route 9A Access Parcel
II set forth in Section 24.9;
(f) Lessee’s failure to make any payment or to perform or comply with any of the other
covenants, agreements, terms or conditions contained in this Lease on Lessee’s part to be kept,
observed, performed or complied with and/or the exercise by Lessor or its designee of any remedy
provided in this Lease with respect to such failure;
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(g) Any lien, encumbrance or claim arising by, under or through Lessee that has arisen
against or on Lessor’s leasehold interest in or the State’s fee title to the Premises, or any lien,
encumbrance or claim created or permitted to be created by Lessee or any of its partners, joint
venturers, officers, shareholders, directors, agents, contractors, servants, employees, Occupants or
invitees against any assets of, or funds appropriated to, Lessor (other than liens in favor of a
Mortgagee), or any liability asserted against Lessor with respect thereto except to the extent such
liability arises from Lessor’s gross negligence or willful misconduct;
(h) Any failure on the part of Lessee to keep, observe and perform any of the terms,
covenants, agreements, provisions, conditions or limitations contained in, any other contracts and
agreements affecting the Premises that are entered into by Lessee, and that are on Lessee’s part to
be kept, observed or performed;
(i) Lessee’s non-payment when due of any recording fees or transfer tax, if any,
attributable to the execution, delivery or recording of this Lease or a memorandum hereof;
(j) Any claim by a third party that the uses enumerated in clauses (a) through (r) of
Section 21.1 are not consistent with the Act (provided that it shall be a condition of Lessee’s
indemnity obligation under this Section 17.1(j) that Lessor shall not take and shall not have taken
as of the Commencement Date any position that any use enumerated in clauses (a) through (r)
above is not consistent with the Act); or
(k) The keeping, storage, transportation, disposal, release or threatened release by
Lessee or any of its partners, joint venturers, officers, shareholders, directors, agents, contractors,
servants, employees, Sublessees and Occupants, of any Hazardous Materials over, under, in, on,
from or affecting the Premises, or any Persons, real property, personal property, or natural
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substances thereon or affected thereby, including, without limitation, any such liability, suits,
obligations, fines, damages, penalties, claims, costs, charges and expenses imposed as a result
thereof upon, incurred by or asserted against any of the Indemnitees under any applicable
Requirement, but excluding (i) the release of Hazardous Materials over, under, in, on, from or
affecting the Premises caused by any of the Indemnitees or arising from outside of the Premises
and which is not caused by Lessee or its contractors or agents or Sublessees or Occupants or (ii)
as set forth in Section 17.2 of the Original Lease regarding pre-existing Hazardous Materials in
which New York State agreed to be deemed the owner of such Hazardous Materials should such
Hazardous Materials exist.
Section 17.2. The obligations of Lessee under this Article shall not be affected in any way
by the absence of insurance coverage, or by the failure or refusal of any insurance carrier to
perform an obligation on its part to be performed under insurance policies affecting the Premises.
Section 17.3. If any claim, action or proceeding is made or brought against any of the
Indemnitees in connection with any event referred for which Lessee is obligated to indemnify the
Indemnitees pursuant to the Lease, then upon prior written notice to Lessee of such claim, action
or proceeding, and a simultaneous or subsequent demand of Lessor, Lessee shall either resist,
defend or satisfy such claim, action or proceeding in such Indemnitee’s name, by the attorneys for,
or approved by, Lessee’s insurance carrier (if such claim, action or proceeding is covered by
insurance), or by such other attorneys as Lessee may retain and that Lessor shall approve (which
approval shall not be unreasonably withheld or delayed). The foregoing notwithstanding, any such
Indemnitee may engage its own attorneys in addition to any counsel appointed by Lessee’s
insurance carrier or otherwise retained by Lessee to defend such Indemnitee, or to assist such
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Indemnitee in such Indemnitee’s defense of such claim, action or proceeding, as the case may be,
in each case at such Indemnitee’s sole cost and expense.
Section 17.4. Promptly, upon having actual knowledge thereof, an Indemnitee shall notify
Lessee of any cost, liability or expense incurred by, asserted against, or imposed on, such
Indemnitee, as to which cost, liability or expense Lessee has agreed to indemnify such Indemnitee
pursuant to this Lease. Lessee agrees to pay such Indemnitee all amounts due under this Section
17.4 within thirty (30) Business Days after Lessor’s request therefor, if Lessee is obligated to make
such payment pursuant to the terms of this Lease.
Section 17.5. The provisions of this Article shall survive the expiration or earlier
termination of this Lease with respect to actions or the failure to take any actions or any other
matter arising prior to such expiration or termination.
RIGHT OF ENTRY, ETC.
Section 18.1. Lessor, the State, and the City and their respective designees shall have the
right during regular business hours upon reasonable prior written notice (which notice may be
given by email), except in case of an emergency in which case entry may be made at any time and
no notice shall be required, to enter upon the Premises with workers, materials and equipment to
(a) inspect the same; (b) determine whether or not Lessee is in compliance with its obligations
hereunder; (c) construct, reconstruct, lay, relay, maintain, operate and inspect Lessor’s and/or the
State’s or the City’s facilities in or adjacent to the Premises; (d) maintain, replace and repair
existing municipal facilities located within the Premises, if any; (e) maintain fire communications
facilities, sewers, water mains and street sub-surface below the Premises; (f) access other facilities
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adjacent to the Premises; and (g) make any necessary repairs to the Premises or perform any work
therein that Lessor may be entitled to in accordance with the terms of this Lease as a result of
Lessee’s failure to do so in accordance with the provisions of this Lease. Except in the case of an
emergency, Lessee shall have the right to accompany Lessor and/or State or City during such
access. The easement reserved hereby is in addition to any other easement, right-of-way or other
right that constitutes a Title Matter as described in Exhibit B hereto.
Section 18.2. Lessor shall promptly repair or cause to be repaired any damage to the
Premises caused by Lessor, its officers, employees, agents, servants, representatives and invitees
while on the Premises for the purposes contemplated by this Article 18.
Section 18.3. Lessor, upon reasonable notice to Lessee and provided Lessor shall not
unreasonably interfere with Lessee’s (or any Occupant’s) use of or access to the Premises, shall
have the right to enter the Premises during regular business hours within two (2) years prior to the
Expiration Date or earlier termination of this Lease for the purpose of showing to prospective
tenants all or any part of the Premises.
Section 18.4. Lessor and Lessee agree to reasonably cooperate and coordinate with each
other any construction being performed by or on behalf of Lessee on the exterior of the Premises
with any construction being performed in areas located in close proximity to the Premises by or
on behalf of Lessor, Lessor’s tenants and licensees and/or any Governmental Authority.
Section 18.5. Nothing in this Article 18 or elsewhere in this Lease shall imply any duty
on the part of Lessor to do any work required to be performed by Lessee hereunder and
performance of any such work by Lessor shall not constitute a waiver of Lessee’s default in failing
to perform the same. Lessor, during the progress of any such work, may keep and store at the
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Premises all necessary materials, tools, supplies and equipment. Lessor shall not be liable for
inconvenience, annoyance, disturbance, loss of business or other damage of or to Lessee, any
Sublessee or other Occupant of the Improvements by reason of making such repairs or the
performance of any such work, or on account of bringing materials, tools, supplies and equipment
into the Premises during the course thereof, except if the same is caused by the gross negligence
of Lessor or its agents or employees, provided Lessor shall use all reasonable efforts to minimize
damage and inconvenience to Lessee and the other Occupants of the Premises resulting from
Lessor’s exercise of its rights under this Article 18, and the obligations of Lessee under this Lease
shall not be affected thereby.
RIGHT TO PERFORM COVENANTS OF OTHER PARTY
Section 19.1. If Lessee shall at any time (a) fail to pay any Imposition in accordance with
the provisions of Article 4 hereof, or (b) fail to obtain, pay for, maintain or deliver any of the
insurance policies provided for herein, or cause same to be renewed or replaced prior to the
expiration of any existing policy, or (c) otherwise be in Default in the performance of any other
obligations under this Lease, after notice thereof and after the expiration of the applicable grace
periods, if any, provided under this Lease for Lessee or a Mortgagee, respectively, to cure or
commence to cure the same, Lessor, without waiving or releasing Lessee from any obligation of
Lessee contained in this Lease may:
(i) after notice to Lessee and continuance of such failure by Lessee for ten (10)
days after the giving of such notice, pay any Imposition required to be paid by Lessee pursuant to
the provisions hereof; or
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(ii) if Lessee has not renewed or obtained replacement insurance prior to the
expiration of an existing insurance policy, obtain, pay for and maintain any of the insurance
policies provided for herein; or
(iii) after notice to Lessee, and continuance of such failure by Lessee for thirty
(30) days after the giving of such notice, perform any other act on Lessee’s part to be made or
performed as provided in this Lease, and may enter upon the Premises for such purpose and take
all such action thereon as may be necessary therefor.
Section 19.2. All reasonable sums paid by Lessor and all reasonable costs and expenses
incurred by Lessor in connection with its performance of any obligation pursuant to Section 19.1,
together with interest thereon at the Applicable Rate from the respective dates of Lessor’s making
each such payment or incurring each such cost or expense until the date of actual repayment to
Lessor, shall be paid by Lessee to Lessor within ten (10) days after Lessor submits to Lessee a
statement, in reasonable detail, substantiating the amount demanded by Lessor. Any payment or
performance by Lessor pursuant to Section 19.1 shall not be nor be deemed to be a waiver or
release of any Default with respect thereto or of the right of Lessor to terminate this Lease. Lessor
shall not be limited in the proof of any damages that Lessor may claim against Lessee arising out
of or by reason of Lessee’s failure to provide and keep insurance in force in accordance with this
Lease to the amount of the insurance premium or premiums not paid.
Section 19.3. If Lessor shall fail to observe or perform (subject to Unavoidable Delay)
one or more of the terms, conditions, covenants or agreements of this Lease on Lessor’s part to be
performed or observed that can feasibly and lawfully be performed by Lessee without
unreasonable effort or expense, Lessee may send a notice to Lessor specifying such failure and
advising Lessor of Lessee’s intention to undertake performance of such Lessor’s obligation(s) if
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Lessor does not perform such obligations in accordance with the provisions of the Lease. If
Lessor’s failure to observe or perform such obligation(s) under the Lease continues for a period of
thirty (30) Business Days after receipt of Lessee’s notice (unless such failure requires work to be
performed, acts to be done, or conditions to be removed which cannot, by their nature, reasonably
be performed, done or removed within such thirty (30) Business Day period, in which Lessor shall
not be deemed to be in default in the performance of its obligations under the Lease as long as
Lessor shall have commenced curing the same within such thirty (30) Business Day period and
shall diligently and continuously prosecute the same to substantial completion), Lessee, without
waiving or releasing Lessor from any obligation of Lessor contained in this Lease may, but shall
be under no obligation to, perform such obligation(s) on Lessor’s behalf. After submission to
Lessor of a written statement setting forth in reasonable detail Lessee’s expenses, with supporting
documentation, Lessee shall be entitled to take as credit against the next installments of Fixed Base
Rent all reasonable sums paid by Lessee and all reasonable costs and expenses incurred by Lessee
in connection with its performance of any obligation of Lessor pursuant to the preceding sentence.
Unless otherwise set forth in this Lease, if Lessee is obligated to obtain Lessor’s consent and
Lessor has agreed that such consent will not be unreasonably withheld, delayed or conditioned,
and if Lessee claims that Lessor has unreasonably withheld, delayed or conditioned its consent in
such instance, Lessee’s sole remedy will be an action for specific performance and Lessee shall
not be entitled to make any claim for money damages (whether by way of set-off, counterclaim or
defense) based on any claim or assertion by Lessee that Lessor acted unreasonably in withholding,
delaying or conditioning its consent.
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NO ABATEMENT OF RENTAL
Except as expressly set forth in this Lease, there shall be no abatement, off-set, diminution,
suspension or reduction of Rental payable by Lessee hereunder or of the other obligations of
Lessee hereunder under any circumstances.
PERMITTED USE; NO UNLAWFUL OCCUPANCY
Section 21.1. Subject to the terms of this Article 21, Lessee shall use and occupy (and
shall obligate Occupants entering into Occupancy Agreements after the Commencement Date to
use and occupy) those portions of the Premises as set forth below in conformity with this Lease
and the Requirements for the following permitted uses:
(a) Management and operation of a two-rink skating facility on Pier 61, which
permitted use is Sports and Recreation;
(b) Management and operation of production facilities in the Headhouse and on the
second level of the buildings on Piers 59, 60, and 61 for the following: film, television, digital
media, photography, and new and emerging media forms for communication and entertainment
(“Production Facilities”) subject to the provisions of Section 21.1(n);
(c) Management and operation of a marina on the water portion of the Premises south
of Pier 59 and of sightseeing, excursion, meal and beverage service and entertainment cruises on
other water portions of the Premises where a marina is not being operated and contiguous apron
areas (provided that such use of contiguous pier apron areas does not materially obstruct public
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access and circulation), provided that notwithstanding anything to the contrary contained herein,
the management and operation of any dining service or other permitted use aboard a vessel or other
floating structure while it is docked at the Premises shall not be permitted except in connection
with the regular sailing of such vessel or other floating structure, except that such limitation shall
not apply to vessels or other floating structures used for the repair and maintenance of the Premises,
and further, any vessel shall be located at least ten feet west of the entrance located at the south
side of Pier 59;
(d) Management and operation of the Public Access Areas as set forth in Article 24;
(e) Management and operation of a multi-tiered golf facility and driving range enclosed
by appropriate fencing or netting on Pier 59, which permitted use is Sports and Recreation;
(f) Management and operation of a health club/gymnasium, indoor track facility, rock
climbing and other indoor sports on Pier 60, which permitted use is Sports and Recreation;
(g) Management and operation of Restaurants, Catering Facilities and other food and
beverage services throughout the Premises not to exceed 120,000 square feet of Usable Square
Footage in the aggregate, provided however that, in the event that Restaurants, Catering Facilities
and other food and beverage services exceed 100,000 square feet of Usable Square Footage in the
aggregate, such excess Usable Square Footage shall be subject to the approval of Lessor in its sole
but reasonable discretion pursuant to the same criteria set forth in Section 21.1(s)(A)-(D) that is
applicable to a Use Modification. For the purposes of this Section 21.1, the term “Restaurants”
shall mean a food and beverage service facility that is open to the public, includes seating
arrangements for on-premises dining and that is not closed in its entirety to the public for private
events (except for a limited number of holiday private events) and shall be further subject to
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Section 21.1(s) as applicable, and the term “Catering Facilities” shall mean a food and beverage
service facility used for private events that is not open to the public for on premises dining and
shall be further subject to Section 21.1(s) as applicable.
(h) Retail uses related thematically to other permitted uses including but not limited to
sports, marine and entertainment related retail and art galleries open to the public not to exceed
100,000 square feet of Usable Square Footage in the aggregate (except Prohibited Big Box
Retailers as defined in Section 21.4 hereof) and shall be further subject to Section 21.1(s) as
applicable;
(i) Existing uses of Existing Tenants;
(j) Accessory parking for patrons, employees, and visitors of Lessee and Occupants of
the Premises;
(k) Management and operation of facilities for gymnastics, swimming, tennis,
basketball, baseball, soccer and other team and individual sports, which permitted use is Sports
and Recreation;
(l) Management and operation of children’s and family recreation facilities, including
but not limited to children’s day camps, recreational activities, and children’s birthday parties and
celebrations of children’s events, which permitted use is Sports and Recreation;
(m) Bowling alley and other recreational facilities for children and families, which
permitted use is Sports and Recreation;
(n) Management and operation of office use consistent with the Act in the Headhouse
building, other than on the ground floor thereof except that (i) office use related to Production
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Facilities as set forth in Section 21.1(b) may be located on the first floor of the Headhouse between
Piers 60 and 61, (ii) any Occupant occupying office space in the Headhouse building above the
ground floor thereof may have a reception area and/or an entry area on the ground floor of the
Headhouse building, and (iii) uses set forth in Section 21.1(r);
(o) Management and operation of a museum or exhibition space related to historical
events, sports, Production Facilities, maritime themes, or art, consistent with the uses set forth in
(a) through (n) above;
(p) Occasional, temporary and rotating exhibition space not related to the uses set forth
in Section 21.1(o);
(q) Temporary uses by or for the benefit of Governmental Authorities for public health,
safety and security purposes; and
(r) Ancillary storage, office and support uses incidental to and ordinarily and
customarily related directly to the administrative, building maintenance, building repair, and other
business operations of Lessee or any agent of Lessee as manager of the Premises.
(s) (I) Except for uses enumerated in clauses (a)-(r) of this Section 21.1, no other uses
shall be permitted and no individual use permitted by clause (g) of this Section 21.1 shall be newly
established or relocated from its existing location within the Premises as of the Execution Date
(unless such relocation is within the same pier shed building or portion of the Headhouse) if such
newly established use or change in location involves (x) more than 5,000 square feet of Usable
Square Footage on a cumulative basis from and after the Execution Date for one or more individual
Catering Facility uses permitted by clause (g) of this Section 21.1, or (y) more than 15,000 square
feet of Usable Square Footage for any individual Restaurant use permitted by clause (g) of this
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Section 21.1 (each, a “Use Modification”), unless written consent is granted by Lessor in its sole
but reasonable discretion pursuant to this Section 21.1(s). As used herein, reference to “relocated
from existing locations” shall refer to one or more individual relocations of more than 5,000 square
feet on a cumulative basis from and after the Execution Date for Catering Facilities and more than
15,000 square feet from and after the Execution Date for individual Restaurant uses permitted by
clause (g) of this Section 21.1, respectively, regardless of when or how many such relocations
occur.
(II) To the extent that uses permitted by clause (h) of this Section 21.1 shall be newly
established after the Execution Date and to the extent that such newly established uses permitted
by clause (h) of this Section 21.1 involve more than 30,000 square feet of Usable Square Footage
on a cumulative basis from and after the Execution Date, no such newly established uses shall be
permitted unless written consent is granted by Lessor. In reviewing Lessee’s proposed newly
established use permitted by clause (h) that requires Lessor consent pursuant to this Section
21.1(s)(II), Lessor shall not withhold its consent provided such newly established use is compliant
with provisions of this Lease, the Requirements and meets the criteria set forth in clause (iv) of
Section 21.1(s)(A) that would be applicable if such newly established use constituted a “Use
Modification”. A proposed new use permitted by clause (h) that requires Lessor consent pursuant
to this Section 21.1(s)(II) shall not be considered to be a “Use Modification.”
(A) In reviewing a Use Modification proposed by Lessee (or a proposed use of Lessee’s
Available Development Rights designated as a Use Modification pursuant to Section 21.1(w)),
Lessor shall consider the following factors, and may request such additional information as Lessor
determines to be reasonably necessary in order to conduct its review, including without limitation
environmental review as may be required under the State Environmental Quality Review Act
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(“SEQRA”) as applicable: (i) that the proposed Use Modification is not prohibited under this
Lease and complies with the Requirements; (ii) that the proposed Use Modification, if granted,
allows Lessee to continue to meet the Minimum Sports/Recreation Usage Standard and does not
alter the character of the Lessee’s business at the Premises from one which is primarily oriented
to commercial sports and recreation; (iii) that the proposed Use Modification, if granted, allows
Lessee to continue to meet the Operating Standard as defined in Section 21.2; (iv) that the proposed
Use Modification, if granted, would not result in (a) a material increase or change in vehicular
traffic at or to the Premises, or (b) a material visual, noise, air quality, or other environmental
impact that, with regard to sub-clauses (a) and (b) would, individually or cumulatively with the
Use Modification under consideration and other prior Use Modifications that have been granted,
be adverse compared to the existing condition for the Premises at the time Lessee requests approval
of the proposed Use Modification; (v) that except as provided in, as applicable, Section 21.1(w)
and Section 39.23, the proposed Use Modification, if granted, will not result in Lessee using more
Zoning Square Footage than those already used by the Improvements at the time Lessee requests
approval of the proposed Use Modification, or reducing the amount of Excess Development Rights
from such time; (vi) that the proposed Use Modification, if granted, will not cause the public’s use
of the Public Access Area to be impeded, constrained or otherwise adversely effected; (vii) that
the proposed Use Modification, if granted, does not violate, or is not inconsistent with, the Act,
and, if it is a park/commercial use, is compatible with park use; and (viii) that the proposed Use
Modification, if granted, does not conflict with, or cause a nuisance to, or endanger the health and
safety of, or otherwise adversely impact the adjacent landscape or use and enjoyment by any of
Lessor’s adjacent or proximate tenants or concessionaires, or Park users, or surrounding residential
communities.
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(B) If Lessor, in its sole but reasonable judgement, denies approval of a proposed Use
Modification (or proposed use of Lessee’s Available Development Rights designated as a Use
Modification pursuant to Section 21.1(w)), or determines that such Use Modification (or proposed
use of Lessee’s Available Development Rights designated as a Use Modification pursuant to
Section 21.1(w)) is approved with conditions, or determines that such Use Modification (or
proposed use of Lessee’s Available Development Rights designated as a Use Modification
pursuant to Section 21.1(w)) requires the submittal of further information in order for Lessor to
conduct its review, Lessor shall so notify Lessee, specifying its objections, or conditions for
approval, or information needed in reasonable detail and Lessee shall either (I) elect to abandon
the proposed Use Modification (or proposed use of Lessee’s Available Development Rights
designated as a Use Modification pursuant to Section 21.1(w)), or (II) revise the proposed Use
Modification (or proposed use of Lessee’s Available Development Rights designated as a Use
Modification pursuant to Section 21.1(w)) to meet Lessor’s objections and/or confirm its
agreement to Lessor’s conditions for approval, or (III) provide such additional information as
Lessor determines to be reasonably necessary in order for it to conduct its review, and, if Lessee
elects to not abandon the proposed Use Modification (or proposed use of Lessee’s Available
Development Rights designated as a Use Modification pursuant to Section 21.1(w)), Lessee shall
thereafter submit such revision, confirmation or additional information. Alternately, Lessor shall
so notify Lessee of its approval of the proposed Use Modification. Except as provided in Section
21.1(s)(C), review by Lessor shall be carried out within fifteen (15) Business Days of the date of
initial submission of the proposed Use Modification (or proposed use of Lessee’s Available
Development Rights designated as a Use Modification pursuant to Section 21.1(w)) and within ten
(10) Business Days of the date of submission of a revised proposed Use Modification (or proposed
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use of Lessee’s Available Development Rights designated as a Use Modification pursuant to
Section 21.1(w)) or additional information. If Lessor does not notify Lessee of its determination
within such fifteen (15) Business Day or ten (10) Business Day period, Lessee may give Lessor a
notice of such failure stating that if Lessor fails within five (5) additional Business Days to
approve, approve with conditions, or disapprove (along with reasons for any disapproval), Lessor
shall be deemed to have approved the proposed Use Modification (or proposed use of Lessee’s
Available Development Rights designated as a Use Modification pursuant to Section 21.1(w)) .
Lessee’s notice shall contain the following legend on the top of the notice: “FAILURE TO
RESPOND TO THIS NOTICE WITHIN FIVE BUSINESS DAYS OF RECEIPT WILL RESULT
IN LESSOR’S CONSENT TO [PROPOSED USE MODIFICATION] [PROPOSED USE OF
LESSEE’S AVAILABLE DEVELOPMENT RIGHTS] BEING DEEMED TO HAVE BEEN
GRANTED”.
(C) If SEQRA is applicable to the proposed Use Modification as set forth in this Section
21.1(s) (or the proposed use of Lessee’s Available Development Rights designated as a Use
Modification pursuant to Section 21.1(w)), then the timeframes set forth in Section 21.1(s)(II)(B)
commence after the completion of the required SEQRA review.
(D) Except as expressly provided for in the Lease, Lessor shall not condition its consent
upon a payment by Lessee to Lessor of any sums of money not due under this Lease.
(t) Lessor shall not take any position that any use enumerated in clauses (a) through
(r) of this Section 21.1 is not consistent with the Act. If a third party other than Lessor shall assert
that any use enumerated in clauses (a) through (r) above is not consistent with the Act and a court
of competent jurisdiction shall determine by a final judgment that is not subject to appeal that such
use is not consistent with the Act, then (x) such determination shall not reduce, alter or affect the
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Rental or other obligations of Lessee hereunder, (y) such determination shall not give rise to any
liability of Lessor in favor of Lessee as a result of the enumeration of such use in clauses (a)
through (r) above, and (z) Lessee shall not be deemed to be in breach of this Section 21.1 as a
result of the existence of such use until Lessee has had a reasonable opportunity to cause such use
to cease (and Lessor recognizes that if such use is permitted under an Occupancy Agreement that
was entered into in accordance with this Lease then Lessee shall not be required to cause such use
to cease until such Occupancy Agreement terminates in accordance with its terms, or as of such
earlier date as determined by a court of competent jurisdiction or as may be required by law, or if
Lessee otherwise has the right to terminate the Occupancy Agreement prior to its stated expiration
date as a result of such decision).
(u) Lessee shall contractually obligate each Occupant under an Occupancy Agreement
that is executed after the Commencement Date to use the portion(s) of the Premises subleased or
licensed to such Occupant in a manner that does not violate the provisions of this Section 21.1.
(v) Notwithstanding anything to the contrary contained herein, the granting of
permitted uses set forth in this Section 21.1 does not confer any right of exclusivity, or limitations
with respect to the rights and operation of commercial business at locations elsewhere within the
Park which may be deemed competitive with the business operations of Lessee or any Occupant.
(w) Lessee shall further have the right to use Lessee’s Available Development Rights
(as defined in Article 1 including without limitation by converting existing parking areas to
leasable space) without the payment of any additional Fixed Base Rent subject to the following
conditions: (a) that the use of the additional square footage shall be located within the Existing
Improvements and not change the bulk or height of the Existing Improvements; (b) that the use of
the additional square footage shall be subject to Lessor’s granting approval in its sole but
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reasonable discretion pursuant solely to the criteria set forth in Section 21.1(s) as a Use
Modification excepting for (i) use of additional square footages with each such individual use not
exceeding 2,500 square feet of additional Usable Square Footage, or (ii) use of up to 20,000 square
feet of additional Usable Square Footage in the aggregate from and after the Execution Date on a
floor other than pier deck level (the calculation in this clause (ii) shall not include any uses
described in clause (i) or clause (iii) of this sentence), or (iii) use of up 30,000 in square feet of
additional Usable Square Footage for Production Facilities in the aggregate from and after the
Execution Date (the calculation in this clause (iii) shall not include any uses described in clause
(i) or clause (ii) of this sentence); (c) that Lessee shall document that it will continue to meet the
Minimum Sports/Recreation Usage Standard; (d) that if such use constitutes a Capital
Improvement, Lessee complies with the applicable requirements for a Capital Improvement as set
forth in Article 11; and (e) that upon the addition of Usable Square Footage, Lessee and Lessor
shall consult and determine whether any changes to the Traffic and Pedestrian Management Plan
are necessary and appropriate pursuant to Section 24.9. Except with respect to clause (b)(i) of this
Section 21.1(w), all Usable Square Footage limitations in clause (b) shall be in the aggregate from
and after the Execution Date. With respect to clause (b)(i) of this Section 21.1(w), such individual
uses of additional Usable Square Footage of up to 2,500 square feet of Usable Square Footage
shall not exceed 10,000 square feet of Useable Square Footage in the aggregate from and after the
Execution Date.
(x) Lessee shall keep approximately two-thirds of the frontage wall that faces the
Sunset Strip corridor occupied by “public facing” uses, including sports and recreation, food and
beverage, retail or other permitted uses open to the public. To the extent such frontage wall is not
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occupied by such “public facing” uses or other permitted uses, Lessee shall retain, replace or
expand the existing History Wall in a manner that presents displays that engage the public.
Section 21.2. Lessee shall (and shall obligate all Occupants to) operate and maintain the
Premises as a first-class, high quality (subject to ordinary wear, tear and replacement) mixed-use
facility, in conformance with the Act, in a safe, clean and reputable manner, and in accordance
with this Lease and rules established by and amended from time to time by Lessee (a copy of
which rules, as amended from time to time, shall be provided to Lessor) (the foregoing standards
referred to collectively as the “Operating Standard”), and all applicable Requirements (it being
acknowledged that it shall not constitute a breach of this Lease if minor violations (as defined in
the following sentence) of the Requirements occur so long as the effect of such minor violations,
individually and cumulatively, is not material and does not lead to administrative, civil or criminal
enforcement actions by applicable government agencies, and, to the extent that the breach is caused
by an Occupant, so long as Lessee promptly commences and thereafter diligently proceeds in
enforcing any provision of the applicable Occupancy Agreement and other rights available to
Lessee under law or equity so as to remedy the underlying cause of such minor violation. For
purposes of this Section 21.2, a violation shall be deemed as “minor” if a failure to comply with
such Requirement does not (i) cause, in the sole but reasonable judgment of Lessor, a nuisance to
the public (“nuisance” having the same meaning as set forth in Section 21.3) or present an
imminent danger of personal injury or property damage, (ii) subject Lessor to prosecution for a
criminal offense, or the imposition of a financial penalty, or any other administrative or civil
enforcement action, (iii) constitute a default under the State Lease or any mortgage to which either
Lessor’s or Lessee’s leasehold interest may be subject, or (iv) cause the Premises or any part
thereof to be vacated or condemned. Nothing in this Section 21.2 shall relieve Lessee from the
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obligation to comply, and to enforce any Occupant’s obligation under its Occupancy Agreement
to comply, with all provisions of this Lease and all applicable Requirements, including, without
limitation, the provisions of Article 10 and Article 11, in connection with any changes, alterations,
additions or repairs to the Premises or any signage therein made from and after the Execution Date,
and obtaining Lessee’s advance approval or consent prior to adding or modifying Permitted Uses
or Usable Square Footage to the extent required by Section 21.1.
Section 21.3. Notwithstanding anything to the contrary contained herein, in no event shall
Lessee knowingly and intentionally, and Lessee shall obligate each Occupant not to knowingly
and intentionally, use the Premises in any manner that will create noise which is plainly audible
beyond the Premises without the prior written consent of Lessor, which consent may be withheld,
conditioned or delayed in Lessor’s sole and absolute discretion. Noise generated by the repair
activities of Lessee and/or any Occupant (provided Occupant is in compliance with the terms of
its Occupancy Agreement) shall be exempt from such restriction provided it complies in all
material respects with the Requirements. Lessee shall, in addition, undertake commercially
reasonable efforts to limit noise which may materially interfere with, cause a nuisance (the term
“nuisance” shall include both a failure to comply with local noise ordinances, as well as the manner
in which “nuisance” is defined under the common law as construed in the State of New York), or
otherwise materially adversely affect use by the public of the Public Access Areas.
Section 21.4. Notwithstanding anything to the contrary contained herein, but subject to
the specific provisions of this Article 21, Lessor and Lessee acknowledge and agree that Lessee
shall determine, in Lessee’s reasonable commercial judgment, the identity and mix of Lessee and
Occupant occupancies taking into account, among other things, (a) trends in consumer preference
and changes in market demand, (b) appropriate leasing opportunities, (c) the requirements and
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conditions contained in this Lease, (d) Lessee’s contractual obligations to Existing Tenants and
Lessee’s contractual obligations to other Occupants under Subleases entered into in accordance
with this Lease, and (e) Lessee’s obligations to any Mortgagee. Lessee agrees that, in determining
the identity and such mix: (i) in the case of any Occupant other than Existing Tenants, at the
inception of Lessee’s contractual relationship with any given Occupant, such Occupant shall have
been or shall be qualified through the operation and management of its business, and financially
capable, each in Lessee’s reasonable judgment to comply with the Operating Standard, (ii)
establishments offering primarily discounted merchandise or goods and services of inferior quality
shall be prohibited, (iii) retail establishments occupying more than twenty thousand (20,000)
square feet of Usable Square Footage with “big box” retailing characteristics (meaning with an
interior design consisting of minimal finishes and/or “industrial or warehouse-like” elements and
offering merchandise in larger or bulk quantities, and at a lower price point through bulk
purchasing, than would be typical of more traditional retail establishments offering similar
merchandise) shall be prohibited (such prohibited retail establishments described in clauses (ii)
and (iii) being hereinafter referred to as “Prohibited Big Box Retailers”), and (iv) establishments
with the characteristics of a nightclub or cabaret that is open to the public, caters to walk-in
customers, and which generates noise which is plainly audible from areas outside such Occupant’s
demised premises or creates a nuisance of any kind (“nuisance” having the same meaning set forth
in Section 21.3) (“Prohibited Nightclubs”) shall be prohibited (Prohibited Big Box Retailers and
Prohibited Nightclubs, together the “Prohibited Uses”).
Section 21.5. Lessee shall not, and Lessee shall obligate each Occupant not to, use or
occupy, or permit or suffer the Premises occupied by Lessee or by such Occupant or any part
thereof to be used or occupied, (a) for any unlawful or illegal business, use or purpose, (b) in such
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manner as to constitute a nuisance of any kind (“nuisance” having the same meaning set forth in
Section 21.3), whether public or private, in any way in violation of the Certificate(s) of Occupancy
or of the Operating Standard, (c) in such manner that may make void or voidable any insurance
then maintained by Lessee or Lessor on the Premises, (d) for hazardous or environmentally
unsound use or activity in accordance with rules and regulations promulgated by Lessor from time
to time that are applicable to the entire Park (such rules and regulations being posted on the website
of Lessor www.hudsonriverpark.org (or the website of any successor organization to Lessor), and
herein collectively referred to as the “Park Rules”), or which are incompatible with the park uses
as set forth in the Act, (e) for any use that is immoral or disreputable (including, without limitation,
for use as an “adult entertainment establishment”, “adult” bookstore, a massage parlor (other than
as part of fitness and health club activities), or as an “adult” entertainment bar or club), (f) in such
manner as might reasonably make possible a claim or claims by Lessee or any Occupant of adverse
use, adverse possession, prescription, dedication or similar claims of, in, to or with respect to the
Premises or any party thereof and (g) in the case of an Occupant, for a use or in a manner that is
not permitted by the Occupancy Agreement of such Occupant (including without limitation for a
use by such Occupant of its subleased premises that is not permitted by the terms of such
Occupant’s Occupancy Agreement). Lessee shall, upon the discovery of any such unpermitted,
unlawful, or illegal business use or purpose, or of any Prohibited Use (which means of discovery
may include notice from Lessor), promptly demand that the applicable Occupant cease and desist
from such unpermitted, unlawful, or illegal business use or purpose or Prohibited Use, and if such
Occupant does not promptly cease and desist from such unpermitted, unlawful, or illegal business
use or purpose or Prohibited Use, Lessee shall promptly commence and diligently proceed in
enforcing Lessee’s remedies under the Occupancy Agreement and as may be available under law
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and equity, including but not limited to seeking an order of a court of competent jurisdiction
compelling the discontinuance of such unpermitted, unlawful, or illegal business use or purpose
or such Prohibited Use through the commencement of an action for the removal from the Premises
of any Occupant using a portion of the Premises for an unpermitted, unlawful, or illegal business,
use or purpose.
Section 21.6. Lessee shall operate and make available (or cause to be operated or made
available) the Premises for the permitted uses (other than any portion of the Premises leased for
office use and as provided herein) seven (7) days a week (with exception for holidays), subject to
any applicable Requirements. Except as set forth in this Section 21.6, Lessee shall have the right
to establish reasonable, commercially-appropriate hours of operation for the type of uses in the
Premises, subject to any applicable Requirements. Permitted uses may occur outside of the hours
of operation contained in the Park Rules, provided that Lessee and all Occupants using the
Premises after the hours of operation contained in the Park Rules notify their patrons, employees
and visitors that (a) pedestrian entry and exit to and from the Premises outside of the hours of
operation contained in the Park Rules is restricted to those crossings of West Street located directly
to the east of the Premises, (b) pedestrian exit into the Park to the north and south of the Premises
outside of the hours of operation contained in the Park Rules is strictly prohibited, and (c) bicycle
use shall be limited at all times to the bikeway. Further, Lessee shall station an appropriate number
of security personnel during such hours outside of the hours of operation contained in the Park
Rules, and otherwise deploy such movable barriers and signs, as set forth in Exhibit H attached
hereto, to effectuate compliance with such entry and exit requirements and to promote the safety
of the aforementioned patrons, employees and visitors using the Premises outside of the hours of
operation contained in the Park Rules. If at any time Lessor has concerns about the steps taken by
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Lessee with respect to compliance with such entry and exit requirements and/or the safety of the
aforementioned patrons, employees and visitors using the Premises outside of the hours of
operation contained in the Park Rules, Lessor and Lessee shall promptly meet to address
compliance and, to the extent necessary, modify the security plan portion of Exhibit H with respect
to the use of the Premises outside of the hours of operation contained in the Park Rules. Lessee
shall comply with any modifications made to Exhibit H as approved by Lessor in writing.
Section 21.7. This Lease does not grant any permission, license or authority that Lessee
is obligated to obtain pursuant to any Requirements for the performance or conduct of any
business, operation or use which may require any permit or approval from any public or private
party. Lessee shall obtain and maintain (and shall contractually obligate any Occupants to obtain
and maintain, as the case may be) in full force and effect, during the Term at Lessee’s (or the
applicable Occupant’s) sole cost and expense, any governmental license or permit imposed or
mandated by any Governmental Authority in connection with any trade or business conducted in
or use of the Premises, and shall comply (and shall contractually obligate all Occupants to comply)
with any Requirements for the proper and lawful operation of the Premises for the purposes
authorized by this Lease (it being acknowledged that it shall not constitute a breach of this Lease
if minor violations (as defined in the following sentence) of the Requirements occur so long as the
effect of such minor violations, individually and cumulatively, is not material and does not lead to
enforcement actions by applicable government agencies, and, to the extent that the breach is caused
by an Occupant, so long as Lessee promptly commences and thereafter diligently proceeds in
enforcing any provision of the Occupancy Agreement so as to remedy the underlying cause of
such minor violation. For purposes of this Section 21.7, the determination as to whether a violation
is “minor” shall be determined in the same manner as set forth in Section 21.2.
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Section 21.8. Lessor has not made nor makes any representation as to the legality or
conformance with the Requirements of the use of the Premises for the permitted uses; it being
understood, however, that Lessor has no knowledge or information that any permitted use is
contrary to the Requirements. If any permitted use is determined to be illegal by a court of
competent jurisdiction, subject to the terms hereof, Lessee agrees that (a) Lessor and its respective
directors, officers, employees or agents shall not be liable for any damages incurred by Lessee or
any third party as a result of, or in connection with such determination, or illegal use or proposed
use, and (b) Lessee shall defend, indemnify and hold harmless Indemnitees against any cost,
liability or expense incurred by any of them in connection with such determination, or illegal use
or proposed use in accordance with Article 17.
Section 21.9. Neither Lessee nor any Occupant shall permit gambling or a betting office,
or for gambling, legal or otherwise, aboard any vessel operating to or from the Premises or any
vessel docked at the Premises.
Section 21.10. With respect to the marina use, neither Lessee nor any Occupant will allow
(a) “cigarette boats” or large twin engine boats with horsepower in excess of 500 hp per engine to
operate at the Premises, or (b) the use of jet skis or personal watercraft (including use, rental,
storage or servicing of jet skis or personal watercraft) at the Premises.
Section 21.11. Neither Lessee nor any Occupant shall allow the operation of a ferry, water
taxi or other waterborne transportation service to or from the Premises without the prior written
consent of Lessor, which consent may be withheld, conditioned or delayed in the sole discretion
of Lessor. Notwithstanding the foregoing, Lessee shall have the right to contract with operators
of small vessels (20 passengers or less) that transport passengers on an infrequent basis from the
Premises to a specific golf course or residential community in New Jersey on a charter or pre-paid
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reservation basis and which prohibits both (a) walk-up passenger ticketing, and (b) private bus or
other vehicular pick-up or drop off services of any kind from the driveway area on the eastern side
of the Premises.
Section 21.12. Lessor acknowledges that pursuant to the Original Lease there are Existing
Tenants in possession of portions of the Premises pursuant to Subleases that may not contain all
of the contractual obligations required by this Article 21. Lessor further acknowledges that the
existence of such Subleases and the operation of such Existing Tenants in conformity therewith,
or the inability of Lessee to enforce obligations require by this Lease against one or more Existing
Tenants because of the terms of such Subleases shall not constitute a breach of the Lease on the
part of Lessee so long as Lessee does not enter into any Sublease with any such Existing Tenant
upon the expiration of the applicable existing Sublease (after giving effect to any as-of-right
extensions by any such Existing Tenant) that does not contain the contractual obligations required
by this Article 21. Nothing in the preceding sentence shall limit Lessee’s obligation to enforce the
obligations of the Existing Tenants under the terms of their respective Subleases. To the extent
that Lessee’s consent is required for any change of use by an Existing Tenant (or a sub-subtenant
of an Existing Tenant) that would not be permissible under this Article 21, Lessee shall not consent
to such change of use.
EVENTS OF DEFAULT, CONDITIONAL LIMITATIONS, REMEDIES, ETC.
Section 22.1. Each of the following events shall be an “Event of Default” hereunder:
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(a) if Lessee shall fail to make any payment (or any part thereof) of any item of Rental
in accordance with the provisions of this Lease and such failure shall continue for a period of ten
(10) Business Days after notice thereof from Lessor to Lessee;
(b) if Lessee shall fail to maintain the Premises (subject to Unavoidable Delay) as
provided in this Lease and such failure shall continue for a period of twenty (20) Business Days
after Lessor’s notice thereof to Lessee (unless such failure requires work to be performed, acts to
be done or conditions to be removed which cannot, by their nature, reasonably be performed, done
or removed within such twenty (20) Business Day period, in which case no Event of Default shall
exist as long as Lessee shall have commenced curing the same in accordance with this Lease within
such twenty (20) Business Day period and shall diligently and continuously prosecute the same to
substantial completion to the reasonable satisfaction of Lessor within a reasonable period);
(c) if Lessee shall fail to observe or perform (subject to Unavoidable Delay) one or
more of the terms, conditions, covenants or agreements of this Lease on Lessee’s part to be
performed or observed not otherwise provided for in this Section 22.1 and such failure shall
continue for a period of thirty (30) Business Days after Lessor’s notice thereof to Lessee specifying
such failure (unless such failure requires work to be performed, acts to be done, or conditions to
be removed which cannot, by their nature, reasonably be performed, done or removed within such
thirty (30) Business Day period, in which case no Event of Default shall be deemed to exist as long
as Lessee shall have commenced curing the same within such thirty (30) Business Day period and
shall diligently and continuously prosecute the same to substantial completion to the reasonable
satisfaction of Lessor within a reasonable period);
(d) to the extent permitted by applicable Requirements, if Lessee shall admit, in
writing, that it is generally unable to pay its debts as such debts become due and Lessee fails to
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provide evidence satisfactory to Lessor, in Lessor’s sole and absolute discretion, within thirty (30)
days after such admission, that Lessee has the financial ability to meet its obligations under this
Lease;
(e) to the extent permitted by applicable Requirements, if Lessee shall make a general
assignment for the benefit of creditors;
(f) to the extent permitted by applicable Requirements, if Lessee shall file a voluntary
petition under the present or any future Federal Bankruptcy Act or any other present or future
Federal, state or other bankruptcy or insolvency statute or law or if such petition shall be filed
against Lessee and an order adjudicating Lessee as bankrupt or insolvent shall be entered, or if
Lessee shall file a petition or an answer seeking, consenting to or acquiescing in, any
reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief
under the present or any future Federal Bankruptcy Act or any other present or future federal, state
or other bankruptcy or insolvency statute or law, or shall seek, or consent to, or acquiesce in, or
suffer the appointment of, any trustee, receiver, custodian, assignee, sequestrator, liquidator or
other similar official of Lessee, or of all or any substantial part of its properties, or of the Premises
or any interest of Lessee therein, or if Lessee shall take any partnership or corporate action
authorizing any action described in Sections 22.1(d) or 22.1(e) or this Section 22.1(f);
(g) to the extent permitted by applicable Requirements, if within one-hundred-twenty
(120) days after the commencement of a proceeding against Lessee seeking any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar relief under the present
or any future Federal Bankruptcy Code or any other present or future applicable federal, state or
other bankruptcy or insolvency statute or law, such proceeding shall not be dismissed or stayed on
appeal or otherwise, or if, within one hundred twenty (120) days after the appointment, without
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the consent or acquiescence of Lessee, of any trustee, receiver, custodian, assignee, sequestrator,
liquidator or other similar official, or of all or any substantial part of its properties, or of the
Premises or any interest of Lessee therein, such appointment shall not be vacated or stayed on
appeal or otherwise, or if, within one hundred twenty (120) days after the expiration of any such
stay, such appointment shall not be vacated;
(h) if any of the representations or warranties made by Lessee in Article 15 or
elsewhere in this Lease shall be proved to be false or misleading in any material respect as of the
date made; provided, however, that if such misrepresentation was unintentionally made and the
underlying condition is susceptible of being corrected, Lessee shall have a period of forty-five (45)
days after Lessor’s notice of such misrepresentation to correct the underlying condition and
thereby cure such Default;
(i) if, unless necessitated by a Casualty or Taking by eminent domain or Unavoidable
Delay, Lessee shall vacate or abandon the Premises for a period as would cause the property or
liability insurance coverage required to be maintained pursuant to Article 5 to be subject to
cancellation or unenforceability of coverage for breach of or default in the terms of such insurance
coverage, and such failure shall continue for a period of ten (10) Business Days after Lessor’s
notice thereof to Lessee;
(j) if a levy under execution or attachment shall be made against the Premises or any
part thereof, the income therefrom, this Lease or the leasehold estate created hereby on account of
work, labor and services performed by Lessee or on its behalf and such execution or attachment
shall not be vacated, discharged or removed by court order, bonding or otherwise within a period
of sixty (60) days following the date Lessee first has actual knowledge of such levy; or
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(k) If Lessee assigns this Lease or sublets all or a material portion of the Premises in
violation of any of the transfer provisions contained in Article 8 and the same shall not be remedied
within thirty (30) days following notice from Lessor to Lessee.
Section 22.2. If Lessor shall claim that a Default has occurred but (i) such claim shall be
contested by Lessee by legal proceeding and (ii) Lessee shall request a judicial order tolling the
time in which Lessee must cure such Default (a “Stay”) before such Default becomes an Event of
Default, the time in which Lessee must cure such Default before such Default becomes an Event
of Default shall not commence (the “interim tolling period”) until a final determination has been
made with respect to such request for a Stay, but in no event shall such interim tolling period
exceed sixty (60) days. Notwithstanding the preceding sentence, however, if the Default claimed
by Lessor creates, in Lessor’s opinion, a condition dangerous to public health or safety, then
notwithstanding the fact that Lessee may contest the Default or claim, Lessor shall have the right
to enter the Premises and cure the dangerous condition. Such cure shall be at Lessor’s expense if
it is ultimately resolved that no Default hereunder existed, or at Lessee’s expense if it is ultimately
resolved that a Default hereunder existed. Upon such ultimate resolution, if such is that a Default
existed, Lessee shall immediately reimburse Lessor for Lessor’s costs of curing the dangerous
condition, with interest thereon at the Applicable Rate accruing from Lessor’s incurring of such
costs.
(a) If an Event of Default occurs and is continuing, Lessor may elect to proceed by
appropriate judicial proceedings, either at law or in equity, to enforce performance or observance
by Lessee of the applicable provisions of this Lease and/or to recover damages for breach thereof.
(b) If an Event of Default occurs and is continuing and Lessor, at any time thereafter
and during the continuation of such Event of Default, gives Lessee notice specifying the Event of
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Default and stating that this Lease and the Term shall terminate on the date specified in such notice,
which date shall not be less than twenty (20) Business Days after the giving of such notice, then
unless Lessee cures such Event of Default prior to the termination date set forth in such notice,
this Lease and the Term and all rights of Lessee under this Lease to use and occupy the Premises
shall expire and terminate as if the date specified in the notice were the Expiration Date, and Lessee
shall quit and peacefully surrender the Premises to Lessor forthwith. If such termination is stayed
by order of any court having jurisdiction over any case described in Sections 22.1(f) or (g), or by
federal or state statute, then following the expiration of any such stay, or if the trustee appointed
in any such case, Lessee or Lessee as debtor-in-possession fails to assume Lessee’s obligations
under this Lease within the period prescribed therefor by applicable Requirements, or within thirty
(30) days after entry of the order for relief or as may be allowed by the court, or if the trustee,
Lessee or Lessee as debtor-in-possession fails to provide adequate protection of Lessor’s right,
title and interest in and to the Premises and adequate assurance of the complete and continuous
future performance of Lessee’s obligations under this Lease as provided in Section 22.9, Lessor,
to the extent permitted by applicable Requirements or by leave of the court having jurisdiction
over such case, shall have the right, at its election, to terminate this Lease on ten (10) days’ notice
to Lessee, Lessee as debtor-in-possession or the trustee. Upon the expiration of the ten (10) day
period this Lease shall cease and Lessee, Lessee as debtor-in-possession and/or the trustee
immediately shall quit and surrender the Premises.
(c) If this Lease is terminated as provided in Section 22.2(b):
(i) Lessor may, without notice, reenter and repossess the Premises and may
dispossess Lessee and all other persons or property not otherwise subject to an enforceable non-
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disturbance agreement with Lessor, by summary proceedings or otherwise as provided by
applicable Requirements.
(ii) Lessee shall pay to Lessor all Rental payable under this Lease to the date on
which the Term expired and came to an end and shall remain liable for and shall pay to Lessor all
items of Rental falling due thereafter on the respective dates when such items of Rental would
have been payable but for the termination of this Lease.
(iii) Lessee shall be liable for and shall pay to Lessor, as damages, any
deficiency (referred to as “Deficiency”) between the Rental reserved in this Lease for the period
that otherwise would have constituted the unexpired portion of the Term and the net amount, if
any, of rents collected under any reletting effected pursuant to the provisions of this Section 22.2(c)
and rents or other sums collected from any Sublessees of any portion of the Premises for any part
of such period (first deducting from the rents collected under any such reletting and from such
Sublessees all of the payments to Lessor described in this Section 22.2(c)). Any such Deficiency
shall be paid in installments by Lessee on the days specified in this Lease for payment of
installments of Rental, and Lessor shall be entitled to recover from Lessee each Deficiency
installment as the same may arise, and no suit to collect the amount of the Deficiency for any
installment period shall prejudice Lessor’s right to collect the Deficiency for any subsequent
installment period by a similar proceeding. Lessor may complete all construction work required
to be performed by Lessee hereunder and may repair and alter any portion(s) of the Premises in
such manner as Lessor may deem necessary or advisable without relieving Lessee of any liability
under this Lease or otherwise affecting any such liability (and may apply to the foregoing work all
funds, if any, then held by Depository pursuant to Articles 4, 6 or 7, without relieving Lessee of
any liability under this Lease or otherwise affecting such liability), and Lessor shall use reasonable
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efforts to let or relet the Premises for uses consistent with the Act or any portion thereof for the
whole or any part of the remainder of the Term or for a longer period, in Lessor’s name, and Lessor
shall pay and dispose of any rent and other sums collected or received as a result of such reletting
as follows:
(A) first, Lessor shall pay to itself the cost and expense of terminating
what would otherwise have constituted the unexpired portion of the Term, re-entering,
retaking, repossessing, repairing, altering and/or completing construction of the Premises
or any portion(s) of the Premises and the reasonable out-of-pocket cost and expense of
removing all persons and property therefrom, including in such costs brokerage
commissions, legal expenses and court costs and reasonable attorney’s fees and
disbursements;
(B) second, Lessor shall pay to itself the reasonable out-of-pocket cost
and expense sustained in securing any new tenants and other occupants, including in such
costs, brokerage commissions, legal expenses and reasonable attorney’s fees and
disbursements and other reasonable out-of-pocket expenses of preparing any portion(s) of
the Premises, and to the extent that Lessor shall maintain and operate any portion(s) of the
Premises, the reasonable out-of-pocket cost and expense of operating and maintaining
same; and
(C) third, Lessor shall pay to itself any balance remaining on account of
the liability of Lessee to Lessor under this Lease.
Lessor shall not in any way be responsible or liable for any failure to relet any portion(s)
of the Premises if Lessor has used reasonable efforts to relet the Premises, or any part thereof for
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uses consistent with the Act or for any failure to collect any rent due on any such reletting, and no
such failure to relet or to collect rent shall operate to relieve Lessee of any liability under this Lease
or to otherwise affect any such liability.
Section 22.3. Except with respect to the negligent acts or omissions of Lessor, the
obligation of Lessor to mitigate any damages it may sustain and for which Lessor claims Lessee
is responsible, or any right conferred on Lessee pursuant hereto, to the extent not prohibited by
applicable Requirements, Lessee hereby waives and releases all rights, conferred by statute or
otherwise, the purpose or effect of which is to limit or modify any provision of this Article.
Section 22.4. No receipt of moneys by Lessor from Lessee after the termination of this
Lease, or after the giving of any notice of the termination of this Lease, shall reinstate, continue or
extend the Term or affect any notice theretofore given to Lessee, or operate as a waiver of the right
of Lessor to enforce the payment of Rental payable by Lessee hereunder, or operate as a waiver of
the right of Lessor to recover possession of the Premises by proper remedy provided that nothing
in this Section 22.4 shall limit or restrict the cure rights expressly afforded to Lessee by Section
22.2. After the service of notice to terminate this Lease in accordance with the terms of this Lease,
or, after and during the continuation of an Event of Default, the commencement of any suit or
summary proceedings, or after a final order or judgment for the possession of the Premises, Lessor
may demand, receive and collect any moneys due or thereafter falling due without in any manner
affecting the notice, proceeding, order, suit or judgment except to the extent of cure rights
expressly afforded to Lessee by Section 22.2, all such moneys collected (other than cure payments
pursuant to Section 22.2) being deemed payments on account of the use and occupancy of the
Premises, or at the election of Lessor, on account of Lessee’s liability hereunder.
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Section 22.5. Except as expressly provided hereby to the full extent permitted by
applicable law, Lessee hereby expressly waives the service of any notice of intention to re-enter
provided for in any statute or of the institution of legal proceedings in connection therewith, and
Lessee for and on behalf of itself and all Persons claiming through or under Lessee, also waives
any and all rights (a) of redemption provided by any law or statute now in force or hereafter enacted
or otherwise, or (b) of re-entry, or (c) of repossession or (d) to restore the operation of this Lease,
if Lessee is dispossessed by a final, non-appealable judgment or by warrant of a court of competent
jurisdiction or in case of re-entry or repossession by Lessor, or in case of any expiration or
termination of this Lease. The terms “enter”, “re-enter”, “entry” or “re-entry,” as used in this
Lease, are not restricted to their technical legal meanings.
Section 22.6. No failure by either party to insist upon the other party’s strict performance
of any covenant, agreement, term or condition of this Lease or to exercise any right or remedy
available to it by reason of the occurrence of a Default or Event of Default, and no payment or
acceptance of full or partial Rental during the continuance of any Default or Event of Default
(except for payment of Rental in an amount sufficient to effect a cure pursuant to Section 22.2),
shall constitute a waiver of any such Default or Event of Default or of the right to strict
performance of such covenant, agreement, term or condition. No covenant, agreement, term or
condition of this Lease to be performed or complied with by either party, and no Default or Event
of Default by Lessee or Lessor, shall be waived, altered or modified except, in either case, by a
written instrument executed by the other party. No waiver of any Default or Event of Default shall
affect or alter this Lease, but each and every covenant, agreement, term and condition of this Lease
shall continue in full force and effect with respect to any other then existing or subsequent Default
or Event of Default.
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Section 22.7. In the event of Lessee’s Default or threatened Default, Lessor shall be
entitled to enjoin the Default or threatened Default by appropriate legal proceedings and shall have
the right to invoke any rights and remedies allowed at law or in equity, or by statute, or otherwise,
other remedies that may be available to Lessor notwithstanding. Each right and remedy of Lessor
provided for in this Lease shall be cumulative and shall be in addition to every other right or
remedy provided for in this Lease, or other documents executed between the parties prior hereto,
simultaneously herewith or hereafter, or now or hereafter existing at law or in equity or by statute
or otherwise, and the existence or the exercise or beginning of the exercise by Lessor, of any one
or more of the rights or remedies provided for in this Lease, or any other such documents or now
or hereafter existing at law or in equity, or by statute, or otherwise shall not preclude the exercise
by Lessor of any or all other rights or remedies provided for in this Lease or other such documents
or now or hereafter existing at law or in equity or by statute or otherwise.
Section 22.8. Lessee shall pay Lessor all actual out-of-pocket costs and expenses,
including, without limitation, court costs and reasonable attorney’s fees and disbursements,
incurred by Lessor in connection with any action or proceeding to which Lessor may be made a
party because or in connection with the occurrence of any Default or Event of Default by Lessee
under this Lease. Lessee shall also pay Lessor, all its actual out-of-pocket costs and expenses,
including, without limitation, court costs and reasonable attorney’s fees and disbursements,
incurred by Lessor in enforcing any of the terms, covenants or conditions of this Lease, unless
Lessee is the prevailing party in any such action or proceeding. All of the sums paid or obligations
incurred by Lessor in connection with the occurrence of any Default or Event of Default or the
enforcement of the terms, covenants or conditions of this Lease shall be paid by Lessee to Lessor
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within ten (10) Business Days after demand, or they shall bear interest at the Applicable Rate.
This Section 22.8 shall survive the expiration or earlier termination of this Lease.
Section 22.9. Remedies Under Bankruptcy and Insolvency Codes. If an order for relief
is entered or if any stay of proceeding or other act becomes effective against Lessee or Lessee’s
interest in this Lease in any proceeding which is commenced by or against Lessee under the present
or any future Federal Bankruptcy Act or in a proceeding which is commenced by or against Lessee
seeking a reorganization, arrangement, composition, readjustment, liquidation, dissolution or
similar relief under any other present or future applicable federal, state or other bankruptcy or
insolvency statute or law, Lessor shall be entitled to invoke any and all rights and remedies
available to it under such bankruptcy or insolvency code, statute or law or this Lease, including,
without limitation, such rights and remedies as may be necessary to adequately protect Lessor’s
right, title and interest in and to the Premises, or any part thereof, and adequately assure the
complete and continuous future performance of Lessee’s obligations under this Lease. Adequate
protection of Lessor’s right, title and interest in and to the Premises, and adequate assurance of the
complete and continuous future performance of Lessee’s obligations under this Lease, shall mean
the following:
(a) that Lessee shall comply with all of its obligations under this Lease;
(b) that Lessee shall pay Lessor, on the first (1st) day of each month occurring after the
entry of such order, or on the effective date of such stay, a sum equal to the amount by which the
Premises diminished in value during the immediately preceding monthly period, but in no event
an amount which is less than the aggregate Rental payable for such monthly period;
(c) that Lessee shall continue to use the Premises in the manner required by this Lease;
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(d) that Lessor shall be permitted to supervise the performance of Lessee’s obligations
under this Lease;
(e) that Lessee shall hire such security personnel as may be necessary to ensure the
maintenance, protection and security of the Premises as required by this Lease;
(f) that Lessee shall pay Lessor, within thirty (30) days after entry of such order or the
effective date of such stay, as partial adequate protection against future diminution in value of the
Premises and adequate assurance of the complete and continuous future performance of Lessee’s
obligations under this Lease, such security deposit as may be ordered by the court;
(g) that Lessee shall have and will continue to have unencumbered assets after the
payment of all secured obligations and administrative expenses to assure Lessor that sufficient
funds will be available to fulfill the obligations of Lessee under this Lease;
(h) that Lessor shall be granted a security interest (subject to that of the Mortgagees)
acceptable to it in property of Lessee to secure the performance of Lessee’s obligations under this
Lease;
(i) that if Lessee’s trustee, Lessee or Lessee as debtor in possession shall assume this
Lease and propose to assign it (pursuant to Title 11 U.S.C. §365, as it may be amended) to any
Person who shall have made a bona fide offer therefor, the notice of such proposed assignment,
giving (i) the name and address of such Person, (ii) all of the terms and conditions of such offer,
and (iii) the adequate assurance to be provided Lessor to assure such Person’s future performance
under this Lease, including, without limitation, the assurances referred to in Title 11 U.S.C.
§365(b), as it may be amended, shall be given to Lessor by the trustee, Lessee or Lessee as debtor
in possession no later than twenty (20) days after receipt by the trustee, Lessee or Lessee as debtor
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in possession of such offer, but in any event no later than ten (10) days before the date that the
trustee, Lessee or Lessee as debtor in possession shall make application to a court of competent
jurisdiction for authority and approval to enter into such assignment, and Lessor shall thereupon
have the prior right and option, to be exercised by notice to the trustee, Lessee or Lessee as debtor-
in-possession, given at any time before the effective date of such proposed assignment, to accept
an assignment of this Lease upon the same terms and conditions and for the same consideration, if
any, as the bona fide offer made by such Person, less any brokerage commissions which may be
payable by Lessee out of the consideration to be paid by such Person for the assignment of this
Lease.
Section 22.10. If this Lease shall terminate as a result of an Event of Default, any funds
held by Lessor shall be retained by Lessor first to pay any balance on account of liability of Lessee
to Lessor under this Lease, and, second to Lessee if there is any balance remaining after payment
of such liability.
Section 22.11. From and after the date, if any, on which an Event of Default shall have
occurred hereunder and so long as such Event of Default is continuing, subject to the rights of any
Mortgagee, Lessee shall not pay, disburse or distribute any rents, issues or profits of the Premises,
or portion thereof, the proceeds received by Lessee of any insurance policies covering or relating
to the Premises, or any portion thereof, or any awards payable in connection with the condemnation
of the Premises or any portion thereof received by Lessee (except to the extent such insurance
proceeds or condemnation awards are required in connection with any Restoration to be performed
pursuant to Articles 6 or 7), any undistributed cash, certificates of deposit, United States Treasury
bills or similar cash equivalents arising out of or in any way connected with the Premises or this
Lease or any portion thereof or any other sums or receivables appurtenant to the Premises or this
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Lease or any portion thereof (collectively, “Receivables”) except for (i) payments of the costs of
operating Lessee’s business (including required payments to Mortgagees and including ordinary
course management fees and reimbursements to the general partner of Lessee not to exceed
amounts expressly provided for in the governing documents or written contractual agreements of
Lessee without giving effect to any amendment thereof entered into by Lessee after the date of this
Lease without the consent of Lessor), or (ii) payments to Lessor in payment of amounts due or
payable under this Lease. Notwithstanding the foregoing, in no event during the continuance of
an Event of Default, may Lessee disburse any portion of the Receivables to an Affiliate, or its
officer, director, shareholder, manager or member, whether in the form of cash, a dividend, or
otherwise, until the Event of Default has been cured, except for reasonable and customary
payments in the form of payroll for services rendered in the normal course of operating Lessee’s
business.
Section 22.12. The rights and remedies of Lessor and the other provisions of this Article
22 shall survive the expiration or earlier termination of this Lease.
Section 22.13. If an order for relief is entered or if a stay of proceeding or other acts
becomes effective in favor of Lessor or Lessor’s interest in this Lease in any proceeding which is
commenced by or against Lessor under the present or any future federal bankruptcy code or any
other present or future applicable federal, state or other statute or law, Lessee shall be entitled to
invoke any and all rights and remedies available to it under such bankruptcy code, statute, law or
this Lease.
Section 22.14. Nothing contained in this Article 22 shall be deemed to modify the
provisions of Sections 8.6 or 8.7.
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NOTICES
Section 23.1. Wherever it is provided in this Lease that a notice, demand, request,
consent, approval or other communication shall or may be given to or served upon either of the
parties by the other, or by Lessor upon any Mortgagee, and whenever either of the parties wishes
to give or serve upon the other any notice, demand, request, consent, approval or other
communication with respect hereto or to the Premises, each such notice, demand, request, consent,
approval or other communication shall be in writing and, any law or statute to the contrary
notwithstanding, shall be effective for any purpose if given or served as follows:
(a) if by Lessor, by hand, nationally recognized overnight carrier providing
evidence of delivery, or courier delivery, against a receipt, or by mailing the same by registered or
certified mail, postage prepaid, return receipt requested, with a duplicate copy by email (which
email by itself shall not constitute notice) addressed to:
Chelsea Piers L.P. and North River Operating Company L.P.
Pier 62
Suite 300
New York, NY 10111
Attn: David A. Tewksbury
Email: [email protected]
with a copy to:
Manatt, Phelps & Phillips LLP
7 Times Square
New York, New York 10036
Attn: Peter F. Olberg, Esq.
Email: polberg@manatt.com
and/or to such other address(es) and attorneys as Lessee may from time to time designate by notice
given to Lessor as aforesaid; and, in the case of any notice required to be given to any Mortgagee
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pursuant to this Lease, by hand or nationally recognized overnight carrier providing evidence of
delivery, or courier delivery, against a receipt, or by mailing the same by registered or certified
mail, postage prepaid, return receipt requested, with a duplicate copy by email (which email by
itself shall not constitute notice) addressed to each such Mortgagee at the address of such
Mortgagee set forth in the notice mentioned in the first sentence of Section 8.6(a) hereof, and/or
to such other address(es) and attorneys as the applicable Mortgagee may from time to time
designate by notice given to Lessor as aforesaid; such notice address for the Mortgagee as of the
Commencement Date is as follows:
VICI LENDCO LLC
c/o VICI Properties, L.P.
535 Madison Avenue, 20th Floor
New York, New York 10022
Attn: Samantha S. Gallagher, General Counsel
Email: ChelseaPiers@viciproperties.com
with a copy to:
Kramer Levin Naftalis & Frankel LLP
1177 Avenue of the Americas
New York, New York 10036
Attention: Tzvi Rokeach, Esq.
Email: [email protected]
if by Lessee, by hand or nationally recognized overnight carrier providing evidence of delivery, or
courier delivery, against a receipt, or by mailing the same by registered or certified mail, postage
prepaid, return receipt requested, with a duplicate copy by email (which email by itself shall not
constitute notice) addressed to:
Hudson River Park Trust,
Pier 40, 2nd Floor
353 West Street
New York, New York 10014
Attn: President
with a copy to:
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Hudson River Park Trust
Pier 40, 2nd Floor
353 West Street
New York, NY 10014
Attn: General Counsel
Email: [email protected]
and:
Hudson River Park Trust
Pier 40, 2nd Floor
353 West Street
New York, NY 10014
Attn: Chief Financial Officer
Email: [email protected]
and to such other address(es) and attorneys as Lessor may from time to time designate by notice
to Lessee as aforesaid.
Section 23.2. Notwithstanding the foregoing, all bills may be sent directly to Lessee by
email, hand delivery or regular mail. Every notice, demand, request, consent, approval or other
communication hereunder shall be deemed to have been given or served (a) at the time that the
same shall have been actually received at the addressee’s office specified in the Lease (as may be
changed) as evidenced by a signed receipt given upon personal delivery or by postal return receipt
of the United States mail, postage prepaid as aforesaid, and (b) the next Business Day after
transmittal by any nationally recognized delivery service that provides a receipt to the sender. A
party may change the address to which notices are to be sent by notice sent in accordance with the
provisions of this Article 23. Attorneys for any party to this Lease shall have the right, but are not
obligated, to give notices on behalf of their clients. The inability to deliver a notice because of a
change of address of which no notice was given, rejection or any refusal to accept a notice, shall
be deemed to be receipt of the notice, as of the date of such inability to deliver, rejection or refusal
to accept.
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PUBLIC ACCESS AREAS / SECURITY /
TRAFFIC AND PEDESTRIAN MANAGEMENT PLAN
Section 24.1. Throughout the Term of this Lease, and subject only to completion of the
Public Access Improvements as defined in Section 9.1, Lessee shall keep the following areas (the
“Public Access Areas”) within the Premises as depicted in Exhibit G open to the general public,
without any admission charge and subject only to the limitations expressly set forth in this Article
24:
(a) A pedestrian walkway along the east-west length of Pier 59 immediately adjacent
to the south side of the Headhouse (the “Pier 59 Walkway”);
(b) A pedestrian walkway not less than twelve (12) feet wide along the waterfront
apron perimeters of the finger piers at Piers 59, 60, 61, excepting any improvements in the nature
of the Existing Improvements, including, but not limited to, benches, rails, gates, golf net supports,
exit stairways, bollards, handicap and boat loading ramps, utility equipment, marina or golf service
spaces, and planters, which may reduce the passable area below twelve (12) feet provided that
adequate space is left for safe pedestrian usage of such walkway (the “Finger Piers Walkway”);
(c) An interior pedestrian walkway approximately fifteen (15) feet wide (except any
security booths, access stairs, ramps, benches, planters, vending machines and bike racks)
connecting Piers 59, 60, 61 and Pier 62 and extending through garage driveway areas at Pier 60
and Pier 61 (the “Sunset Strip Interior Walkway”);
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(d) An exterior pedestrian walkway approximately fifteen (15) feet wide (except any
benches, rails, gates, bollards, handicap and boat loading ramps, utility equipment, marina or golf
service spaces, and planters) connecting Piers 59, 60, 61 and Pier 62 and extending through garage
driveway areas at Pier 60 and Pier 61 (the “Sunset Strip Exterior Walkway”);
(e) An exterior pedestrian walkway sidewalk area extending (i) along the entire north-
south length of the Premises to the east of the Headhouse (the “Service Road Sidewalks”) and (ii)
along the east-west length of the Pier 62 Headhouse connecting to the northern end of the Sunset
Strip Interior and Exterior Walkways (the “East-West Walkway”);
(f) The public toilets located in the Headhouse at Pier 62 and at Pier 59 (the “Public
Toilets”); and
(g) The Public Access Improvements once constructed by Lessee pursuant to Section
9.1.
Section 24.2. The Public Access Areas referred to in Section 24.1(a), (b), (c), (d) and (e)
shall remain unobstructed and open to the public twelve months a year, seven (7) days a week
(including all holidays) during the hours of operation of the Park as set forth in the Park Rules,
provided however that Lessee may temporarily close portions of such Public Access Areas: (a) as
may be reasonably necessary to clear snow and ice during the winter; (b) if and to the extent
necessary to perform cleaning, maintenance or repairs; (c) if and to the extent necessary to prevent
a loss of Lessee’s interest in the Premises by adverse possession; (d) for occasional special events
or performances (but if at any time Lessor reasonably finds that Lessee’s use of such Public Access
Area pursuant to this Section 24.2(d) has, in frequency or manner, been inconsistent with the
intention of this Lease that the Public Access Areas be open to the public, then Lessor may notify
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Lessee of such finding and thereafter, for a period determined by Lessor in its sole but reasonable
judgement, Lessee shall only be permitted to close an outdoor Public Access Area pursuant to this
Section 24.2 upon the prior approval of Lessor which approval shall not be unreasonably withheld
or delayed), (e) if required for security at the Premises as the result of a particular condition which,
in Lessee’s reasonable determination, is necessary to ensure the safety of the public; or (f) if
required for a Capital Improvement or Non-Approvable Construction Project, repairs or to move
Lessee’s or any Occupant’s Equipment, Lessee’s or any Occupant’s Trade Fixtures, or Lessee’s
or any Occupant’s personal property across a portion of the Public Access Area. Notwithstanding
anything to the contrary contained herein, Lessee shall not, except to ensure the safety of the
public, close portions of both the Sunset Strip Interior Walkway and the immediately adjacent
portions of the Sunset Strip Exterior Walkway that lie along the western side of the Headhouse
and thus block north-south circulation of that section of the Public Access Areas. Notwithstanding
the foregoing, Lessee shall have the right at any time and from time to time to temporarily close
one of the Public Toilets for the maintenance, security or safety at the Premises as reasonably
determined by Lessee provided that signage is installed directing the public to the other Public
Toilet which shall remain in operation during the period of such closure.
Section 24.3. Lessee shall keep the Service Road Sidewalk open and unobstructed for the
passage of pedestrians twelve months a year, seven (7) days a week (including all holidays) during
the hours of operation of the Park as set forth in the Park Rules. During such hours, neither Lessee
nor any Occupant shall (i) stage deliveries or shipments on the Service Road Sidewalk or any
portion thereof, or (ii) except as provided herein, use the Service Road Sidewalk or any portion
thereof to move materials, supplies, equipment, or (iii) park or drive a vehicle or motorized
equipment on the Service Road Sidewalk or any portion thereof. Notwithstanding the foregoing,
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Lessee and any Occupant shall have the right to conduct the movement of deliveries, shipments,
materials, supplies, equipment, vehicles and other items of any nature used in connection with
Lessee’s and Occupant’s business operations through use of the driveway, driveway entrances,
and doorways to the building as shown on Exhibit G and may cross the Service Road Sidewalks
to gain access by such means.
Section 24.4. Lessee shall establish and enforce rules prohibiting the queuing or
congregating of Occupants’ customers in the Public Access Areas except in limited circumstances
that do not materially obstruct the circulation of pedestrians therein.
Section 24.5. Lessee shall place within all Public Access Areas at conspicuous and visible
locations signage pursuant to Section 11.9 stating that its use is free and open to the public during
hours so designated pursuant to this Article 24.
Section 24.6. Lessee shall maintain in good order and repair the Public Access Areas,
both interior and exterior, including but not limited to, as applicable, all paved surfaces, lighting,
railings, benches and other appurtenances, signage, and, with respect to the Public Toilets, all
fixtures, mirrors, HVAC and mechanical systems.
Section 24.7. Lessee shall not and shall contractually obligate each Occupant to not
permit amplified sound or HVAC exhaust to be generated by such Occupant to impair
unreasonably the use and enjoyment of the Public Access Areas by the public.
Section 24.8. Lessee shall be responsible to provide, at its sole cost and expense, a
sufficient number of trained security personnel to ensure the safety of the public on or about the
Public Access Areas. If Lessee fails to provide such personnel as provided in this Section 24.8 on
the Public Access Areas, or if Lessor determines that such personnel are not adequately performing
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their security functions in accordance with this Section 24.8 on the Public Access Areas, or under
any other written agreement providing for such security functions on the Public Access Areas,
Lessor shall give to Lessee written notice of such failure or inadequate performance and Lessee
shall be obligated to remedy, in a prompt and expeditious manner and to Lessor’s reasonable
satisfaction, such failure or inadequate performance. If Lessee fails to remedy, in a prompt and
expeditious manner, such failure or inadequate performance to Lessor’s reasonable satisfaction
after Lessor has given Lessee written notice thereof, in Lessor’s reasonable determination, there
exists an imminent threat to public health or safety resulting from such failure or inadequate
performance, then in addition to any other right and remedy under this Lease, Lessor shall have
the right, following written notice to Lessee, to provide New York City Parks Enforcement Patrol
(“PEP”) officers or such successor security entity designated by Lessor as part of its overall
security for the Park to perform the security functions required to be performed by Lessee in
accordance with this Section 24.8 on the Public Access Areas, and Lessee shall pay to Lessor
Lessor’s actual cost (without markup or profit) of providing such PEP security services until
Lessor can remedy such failure or inadequate performance by Lessor’s security. Lessee
acknowledges that Lessor currently employs PEP officers to maintain public safety and security
and enforce Park Rules and other applicable laws throughout the Park, and Lessee agrees that it
shall at all times abide by the directives of PEP officers acting in their official capacity (or officers
of such successor security entity designated by the Lessor) and shall use commercially reasonable
efforts to cause its employees, agents, concessionaires, vendors, contractors and invitees to obey
such health and safety directives to the extent legally required. Lessee further agrees that Lessor’s
employment of PEP (or successor entity) officers do not relieve, reduce or substitute for Lessee’s
own obligation to provide security personnel. Notwithstanding any provision hereof to the
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contrary, the security service provided by Lessor as set forth herein shall cooperate with Lessee’s
security, and not, except in the case of an imminent threat to public health or safety, interfere with
Lessee’s possession and quiet enjoyment of the leasehold estate demised to Lessee pursuant to this
Lease. Lessor and Lessee shall cooperate with each other and coordinate efforts with regard to
security matters and shall establish lines of communication to effectuate the same.
Section 24.9. Lessee shall, in conjunction with its security obligation, be responsible, at
Lessee’s sole cost and expense, to employ a sufficient number of trained traffic and pedestrian
management personnel to implement the Traffic and Pedestrian Management Plan at the Premises
attached hereto as Exhibit H (the “Traffic and Pedestrian Management Plan”) in the areas specified
in the Traffic and Pedestrian Management Plan (the services to be provided by Lessee pursuant to
the Traffic and Pedestrian Management Plan are referred herein as “Traffic Management
Services”). Lessor has notified Lessee that Lessor will not employ PEP (or successor entity)
officers to perform this function on behalf of Lessee, except as provided in Section 24.8. Lessee
shall give notice to Lessor of any amendment of the Traffic and Pedestrian Management Plan
which shall take effect upon approval by Lessor in writing, which approval shall not be
unreasonably withheld or delayed. If Lessor determines that the staffing level set forth in Exhibit
H should be increased or changed in nature or location, Lessor and Lessee shall consult to
determine whether any such increase or change is necessary or appropriate, and upon any such
determination, Lessee shall make any necessary amendments to the Traffic and Pedestrian
Management Plan and, upon approval in writing by Lessor (which approval shall not be
unreasonably withheld or delayed), implement the agreed-upon increase or changes. For purposes
of this Section 24.9, the defense and indemnification obligations provided by Lessee on behalf of
the Indemnitees in Article 17 do not apply to any claims about or related to the Traffic Management
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Services provided on or within or for the Route 9A Access Parcel II (identified as Location 1 in
Exhibit H). Nothing in the preceding sentence modifies the insurance provisions set forth in
Article 5 and Exhibit F.
UTILITIES
Lessee must obtain and pay all costs of utilities (including, without limitation, installation
thereof, if applicable), including all sewer charges and charges for all water, gas, heat and
electricity, consumed and used in, or with respect to, the Premises, and Lessee, at its sole cost and
expense, shall install, maintain and repair all meters and procure all permits, approvals and licenses
necessary to secure delivery and installation of such utility services to the point of connection to
the utility provider. At the reasonable request of Lessee, Lessor shall cooperate with Lessee to the
extent reasonably necessary or desirable and at Lessee’s sole cost and expense, to enable Lessee
to procure the foregoing, including, without limitation, to the extent within Lessor’s control,
providing utility providers with such access and/or licenses, easements and/or other rights
necessary to bring utilities to the Premises; provided that Lessor shall not charge Lessee or any
utility provider for any such licenses, easements or other rights. Lessee shall pay any utility
charges directly to the companies supplying such utility services all charges therefor, as the same
shall become due.
SUBORDINATION
This Lease and all the rights of Lessee hereunder shall be subordinate to the State Lease.
Lessor covenants and agrees that it shall not terminate, amend or modify the terms of the State
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Lease, except for any renewal thereof or any amendment or modification that shall not materially
and adversely affect the Premises, the Lease and/or any party’s ability to exercise its rights or
comply with its obligations under the Lease. Lessor’s interest in the Premises and in this Lease,
as the same may be modified, amended or renewed, shall not be subject or subordinate to (a) any
Mortgage now or hereafter existing, (b) any other liens or encumbrances hereafter affecting
Lessee’s interest in this Lease and the leasehold estate created hereby, or (c) any Sublease, liens
or encumbrances now or hereafter placed on any Occupant’s interest in the Premises. This Lease
and the leasehold estate of Lessee created hereby and all rights of Lessee hereunder are and shall
be subject to the Title Matters. Simultaneously herewith, the State is entering into a Subordination
and Non-Disturbance Agreement with Lessee and the Person that is the Mortgagee as of the
Commencement Date in the form annexed hereto as Exhibit I.
CERTIFICATES BY LESSOR AND LESSEE
Section 27.1. Lessee shall, within thirty (30) days after notice by Lessor, execute,
acknowledge and deliver to Lessor or any other party reasonably specified by Lessor a statement
certifying that this Lease is unmodified and in full force and effect (or if there have been
modifications, that the same, as modified, is in full force and effect and stating the modifications)
and the date to which each obligation constituting Rental has been paid, and stating whether or
not, to the best knowledge of Lessee, Lessor is in default in the performance of any covenant,
agreement or condition contained in this Lease, and if so, specifying each such default of which
Lessee may have knowledge.
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Section 27.2. Lessor shall, within thirty (30) days after notice by Lessee, execute,
acknowledge and deliver to Lessee or any other party reasonably specified by Lessee a statement
certifying that this Lease is unmodified and in full force and effect (or if there have been
modifications, that the same, as modified, is in full force and effect and stating the modifications)
and the date to which each obligation constituting Rental has been paid, and stating whether or
not, to the best knowledge of Lessor, Lessee is in Default in the performance of any covenant,
agreement or condition contained in this Lease, and if so, specifying each such Default of which
Lessor may have knowledge.
CONSENTS AND APPROVALS
Section 28.1. All consents and approvals and requests for consents or approvals which
may be required under this Lease shall, as a condition of their effectiveness, be in writing. The
granting of any consent or approval by a party to perform any act requiring consent or approval
under the terms of this Lease, or the failure on the part of a party to object to any such action taken
without the required consent or approval, shall not be deemed a waiver by the party whose consent
was required of its right to require such consent or approval for any further similar act.
Section 28.2. Unless provisions providing for consent are contained elsewhere in this
Lease, the following shall apply:
(a) If, pursuant to the terms of this Lease, any consent or approval by Lessor or Lessee
is required, then unless a time period for the rendering of such consent or approval is expressly
provided in this Lease, (i) such consent or approval shall not be unreasonably withheld or denied;
and (ii) if the party who is to give its consent or approval shall not have notified the other party
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within thirty (30) days or such other period as is expressly specified in this Lease after receiving
such other party’s request for a consent or approval that such consent or approval is granted or
denied, and if denied, the reasons therefor in reasonable detail, such consent or approval shall be
deemed granted. Whenever the consent or approval of a party to this Lease is required within a
specifically provided period of time in accordance with this Lease, then the party seeking such
consent or approval shall place on the envelope containing the request for such consent or approval
the words “URGENT – IMMEDIATE RESPONSE CONTRACTUALLY REQUIRED” in
capitalized letters large enough to be clearly distinct.
(b) Any such consent or approval that is to be deemed granted pursuant to Section
28.2(a), shall not be deemed granted unless Lessor or Lessee, as applicable, shall have first given
the other party a second notice, five (5) days before the expiration of such period, specifically
stating that failure to respond shall be deemed consent or approval pursuant to this Section. This
Section 28.2(b) shall not apply to any provisions under this Lease in which a time period for the
rendering of such consent or approval is expressly provided including, but not limited to, the
provisions of Article 11, Section 9.1 and Section 21.1.
(c) If, pursuant to the terms of this Lease, any consent or approval by Lessor or Lessee
is not to be unreasonably withheld or is subject to a specified standard, then in the event there shall
be a final determination that the consent or approval was unreasonably withheld or that such
specified standard has been met so that the consent or approval should have been granted, the
consent or approval shall be the only remedy to the party requesting or requiring the consent or
approval, except that such party shall have the right to seek any available additional remedies if
the other party is found by such determination to have acted arbitrarily or in bad faith.
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Section 28.3. Except as specifically provided herein, no fees or charges of any kind or
amount shall be required by either party hereto as a condition of the grant of any consent or
approval which may be required under this Lease.
SURRENDER AT END OF TERM
Section 29.1. On the Expiration Date, or upon a termination and re-entry by Lessor upon
the Premises pursuant to Article 22, Lessee shall surrender and deliver to Lessor the Premises in
good order, condition and repair subject to any limitation of its obligation set forth in this Lease
and subject to any other terms of this Lease (except in the event of termination upon a Taking in
condemnation proceedings or damage or destruction), reasonable wear and tear excepted, free and
clear of all lettings, occupancies, liens and encumbrances (except in the case of re-entry by Lessor
pursuant to Article 22) other than (i) those, if any, existing at the date hereof, (ii) those created or
consented to by Lessor or Subleases recognized or permitted pursuant to Section 8.1(b) or (iii)
those lettings and occupancies which by their express terms and conditions extend beyond the
Expiration Date, and which Lessor agreed may extend beyond the Expiration Date, without any
payment or allowance whatever by Lessor. Except as otherwise provided in this Lease, Lessee
hereby waives any notice now or hereafter required by law with respect to vacating the Premises
on the Expiration Date.
Section 29.2. On the Expiration Date, or upon a termination and re-entry by Lessor upon
the Premises pursuant to Article 22, Lessee shall deliver to Lessor all of the following that are in
the possession of Lessee or its agent: Lessee’s executed counterparts of all Subleases and any
service and maintenance contracts then affecting the Premises, together with true and complete
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maintenance records for the Premises, all original licenses and permits then pertaining to the
Premises, permanent or temporary Certificates of Occupancy then in effect for the Improvements,
all warranties and guarantees then in effect in connection with any work or services performed or
Equipment installed in the Improvements (together with a duly executed assignment to Lessor,
without representation, recourse or warranty of all of the foregoing that are assignable), provided
however, that the foregoing requirements shall not apply to Trade Fixtures.
Section 29.3. On the Expiration Date, Lessee and/or any Occupant shall be entitled to
remove from the Premises any items of personal property or Trade Fixtures owned or leased by
Lessee or such Occupant which are necessary for the conduct and operation of Lessee’s or such
Occupant’s business, provided that if such removal materially and adversely affects the structural
integrity of the Premises or the underlying plumbing, electrical or HVAC systems therein, then
Lessee shall repair the Premises or cause the Premises to be repaired so as to fully correct such
adverse effect. Unless otherwise agreed in writing by the parties, Trade Fixtures or personal
property of Lessee or of any Sublessee or Occupant remaining on the Premises for thirty (30)
Business Days after the termination of this Lease and after the surrender by or removal of Lessee
or such Sublessee or Occupant of or from the Premises or applicable portion thereof may, at the
option of Lessor, be deemed to have been abandoned by Lessee or such Sublessee or Occupant
and either may be retained by Lessor as its property or be disposed of, at Lessee’s expense and
without accountability to Lessor, in such manner as Lessor may see fit. Lessor shall not be
responsible for any loss or damage occurring to any such property owned by Lessee or any
Sublessee or Occupant, after the expiration of the sooner to occur of the expiration of the
aforementioned thirty (30) Business Day period or the removal of such property.
Section 29.4. The provisions of this Article 29 shall survive any termination of this Lease.
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ENTIRE AGREEMENT
This Lease, together with the Exhibits, Schedules and Appendices hereto, and any written
agreements entered into by Lessor and Lessee as of the date hereof or hereafter, contains all the
promises, agreements, conditions, understandings, inducements, warranties and representations
between Lessor and Lessee relative to the Premises and there are no promises, agreements,
conditions, understandings, inducements, warranties or representations, oral or written, expressed
or implied, between them other than as herein or in the Exhibits, Schedules and Appendices and
other than as may be expressly contained in any written agreement between Lessor and Lessee
executed simultaneously herewith or hereafter.
QUIET ENJOYMENT
Subject to the provisions of any other written agreement hereafter entered into between the
parties (with the consent of any Mortgagee), Lessor covenants that if and as long as Lessee shall
faithfully perform the agreements, terms, covenants and conditions hereof, Lessee shall and may
(subject, however, to the terms and conditions of this Lease and any agreement to which this Lease
may be subject in accordance with the terms and conditions of this Lease), peaceably and quietly
have, hold and enjoy the Premises for the term hereby granted without molestation or disturbance
by or from Lessor or any Person claiming through Lessor and free of any encumbrance created or
suffered by Lessor, except those encumbrances, liens or defects of title created or suffered by
Lessee and the Title Matters.
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DISPUTE RESOLUTION
Section 32.1. Lessor and Lessee hereby waive, for the benefit of each other, trial by jury
in any action, proceeding or counterclaim brought either or both of CPLP or NROC on the one
hand or Lessor on the other hand by any of the foregoing against the other on any matters
whatsoever arising out of or in any way connected with this Lease, the relationship of Lessor and
Lessee, Lessee’s use or occupancy of the Premises, and/or any claim for injury or damages arising
in connection with the foregoing. In the event that either party commences any proceeding for
nonpayment of any rent or any other sums required to be paid by the other party under the terms
of this Lease, the other party will not interpose any counterclaim of any nature whatever or
description in any such proceedings other than mandatory counterclaims, or unless the failure to
file such counterclaim will result in the other party’s inability to bring a separate proceeding under
applicable law.
Section 32.2. Except as otherwise provided in Section 32.4 below, any and all claims
asserted by or against either or both of CPLP or NROC on the one hand or Lessor on the other
hand against the other arising under this Lease or related thereto shall be heard and determined
either in the courts of the United States located in New York City (“Federal Courts”) or in the
courts of the State of New York (“New York State Courts”) located in the City and County of New
York. To this effect Lessor and Lessee agree as follows:
(a) With respect to any possessory proceeding between Lessor and Lessee in New York
State Court, Lessee and Lessor each hereby expressly waive and relinquish any rights they might
otherwise have (i) to move to dismiss on grounds of forum non conveniens, (ii) to remove such
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action to Federal Court; and (iii) to move for a change of venue to a New York State Court outside
New York County.
(b) With respect to any action between Lessor and Lessee in Federal Court located in
New York City, Lessee and Lessor each hereby expressly waive and relinquish any right they
might otherwise have to move to transfer the action to a Federal Court outside the City of New
York.
(c) Lessee and Lessor each agree that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any
other manner provided by applicable Requirements. However, neither party waives its right to
appeal or to obtain a stay.
(d) If either or both of CPLP or NROC on the one hand or Lessor on the other hand
commences any action against the other in a court located other than in the City, County and State
of New York, upon request of the other, Lessor or Lessee, as applicable, shall either consent to a
transfer of the action to a court of competent jurisdiction located in the City, County and State of
New York, or if the court where the action is initially brought will not or cannot transfer the action,
Lessor or Lessee, as applicable, shall consent to dismiss such action without prejudice and may
thereafter reinstitute the action in a court of competent jurisdiction in the City, County and State
of New York.
Section 32.3. Lessor and Lessee irrevocably consent to the service of any and all process
in any action or proceeding instituted against any of them by the mailing of copies of such process
to Lessor and Lessee, as applicable, to their respective addresses, and in the manner set forth in
Article 23, so long as a copy of such papers is also sent by email pursuant to the Notice provisions
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set forth in Article 23. Nothing in this Section shall affect the right of Lessor or Lessee to serve
legal process in any other manner permitted by applicable Requirements.
Section 32.4. Wherever in this Lease is it expressly stated that a dispute is to be resolved
by expedited arbitration, either Lessor or Lessee shall have the right to submit such dispute to
arbitration in the County of New York under the expedited procedures of the Commercial
Arbitration Rules of the American Arbitration Association (presently Rules E-1 through E-10);
provided, however, that with respect to any such arbitration, (i) the list of arbitrators referred to in
Rule E-4 shall be returned within five (5) days from the date of receipt; (ii) the parties shall notify
the American Arbitration Association by telephone within four (4) days of any objections to the
arbitrator appointed and will have no right to object if the arbitrator so appointed was on the list
submitted by the American Arbitration Association and was not objected to in accordance with
Rule E-4; (iii) the Notice of Hearing referred to in Rule E-7 shall be four (4) days in advance of
the hearing; (iv) the hearing shall be held within five (5) days after the appointment of the
arbitrator; (v) the arbitrator shall have no right to award damages; and (vi) the decision and award
of the arbitrator shall be final and conclusive on the parties. If any party fails to appear at a duly
scheduled and noticed hearing for any reason other than an Unavoidable Delay, the arbitrator is
hereby expressly authorized to enter judgment for the appearing party. The arbitrators conducting
any arbitration shall be bound by the provisions of this Lease and shall not have the power to add
to, subtract from, or otherwise modify such provisions. Lessor and Lessee agree to sign all
reasonable documents and to do all other things reasonably necessary to submit any such matter
to arbitration and further agree to abide by the decision rendered thereunder which shall be binding
and conclusive on the parties and shall constitute an “award” by the arbitrator within the meaning
of the American Arbitration Association rules and Applicable Laws. Judgment may be had on the
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decision and award of the arbitrators so rendered in any court of competent jurisdiction. Each
arbitrator shall be a qualified, disinterested and impartial person who shall have had at least ten
years’ experience in New York County working as a professional in the field that is the subject of
the arbitration. Lessor and Lessee shall each have the right to appear and be represented by counsel
before said arbitrators and to submit such data and memoranda in support of their respective
positions in the matter in dispute as may be reasonably necessary or appropriate under the
circumstances. Each party hereunder shall pay its own costs, fees and expenses in connection with
any arbitration or other action or proceeding brought under this Section 32.4, and the expenses and
fees of the arbitrators selected shall be shared equally by Lessor and Lessee. Notwithstanding any
contrary provisions hereof, Lessor and Lessee agree that (i) the arbitrators may not award or
recommend any damages to be paid by either party and (ii) in no event shall either party be liable
for, nor shall either party be entitled to recover, any damages. Neither party shall have ex parte
communications with any arbitrator selected under this Section 32.4 following his or her selection
and pending completion of the arbitration hereunder.
Section 32.5. Lessee shall have the exclusive right, at its sole cost and expense, to seek
reductions in the valuation of the Premises assessed for real property tax purposes and to prosecute
any action or proceeding in connection therewith by appropriate proceedings diligently conducted
in good faith in accordance with the Charter and Administrative Code of New York City. Nothing
contained herein shall be deemed to imply that Lessee (or Lessor) has any obligation to pay Real
Property Taxes.
Section 32.6. Lessee shall have the right to contest the validity of any Requirement or the
application thereof. During such contest, compliance with any such contested Requirement may
be deferred by Lessee on the condition that before instituting any such proceeding, Lessee shall
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deliver to Lessor collateral security, satisfactory to Lessor in Lessor’s sole reasonable discretion,
securing compliance with the contested Requirement and payment of all interest, penalties, fines,
civil liabilities, fees and expenses in connection therewith. Any such proceeding instituted by
Lessee shall be commenced as soon as it is possible after the issuance of any such contested
Requirement and shall be prosecuted with diligence to final adjudication, settlement, compliance
or other mutually acceptable disposition of the Requirement so contested. Notwithstanding the
delivery of any such collateral security, Lessee shall comply with any such Requirement in
accordance with the provisions of Article 12, if by reason of noncompliance therewith, in Lessor’s
sole reasonable discretion, the Premises, or any part thereof, could be in danger of being forfeited
or if Lessor is in danger of being subjected to criminal liability or penalty, or civil liability in excess
of the amount for which Lessee shall have furnished collateral security as required hereby, or if
failure to comply is hazardous to persons or property or would violate any insurance policy
provisions.
Section 32.7. Lessor shall not be required to join in any action or proceeding brought by
Lessee referred to in Section 32.5 or Article 4 or permit the action to be brought by Lessee in
Lessor’s name unless the provisions of any law, rule or regulation at the time in effect require that
such action or proceeding be brought by and/or in the name of Lessor. If so required, Lessor shall
join and cooperate in such proceedings or permit them to be brought by Lessee in Lessor’s name,
in which case Lessee shall pay all costs and expenses (including, without limitation, attorney’s
fees and disbursements) incurred by Lessor in connection therewith. Notwithstanding the
foregoing, provided that an Event of Default is not then continuing, Lessor shall not, without
Lessee’s prior written approval, make or finally agree to any settlement, compromise or other
disposition of any such proceedings or discontinue or withdraw any such proceedings or accept a
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refund or other adjustment of or credit for any Taxes or Impositions as a result of any such
proceedings. Any refunds resulting from any contest by Lessee shall belong to Lessee (less any
fees or expenses due Lessor), even if the action was brought by Lessee in Lessor’s name.
Section 32.8. Lessee shall cooperate fully with any investigation, audit, or inquiry with
respect to this Lease conducted by Lessor, a State or City Governmental Authority or authority
that is empowered directly or by designation to compel the attendance of witnesses and to examine
witnesses under oath, or conducted by any Governmental Authority that is a party in interest to the
transaction, submitted bid, submitted proposal, contract, permit, lease or license that is the subject
of the investigation, audit or inquiry.
Section 32.9. If in connection with any investigation with respect to this Lease or the
matters described in Section 32.8 conducted by Lessor or any authority referred to in Section 32.8
any person who is an officer, employee or agent of CPLP or NROC, or a general partner of such
entities:
(a) has been advised that his or her statement, and any information from such
statement, will not be used against him or her in any subsequent criminal proceeding and still
refuses to testify before a grand jury or other Governmental Authority or authority empowered
directly or by designation to compel the attendance of witnesses and to examine witnesses under
oath concerning the award of or performance under any transaction, agreement, lease, permit,
contract or license entered into with Lessor, the State or any political subdivision or public
authority thereof, or any local development organization, or any public benefit corporation
organized under the laws of the State; or
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(b) refuses to testify for a reason other than the assertion of his or her privilege against
self-incrimination in an investigation, audit or inquiry conducted by a Governmental Authority
empowered directly or by designation to compel the attendance of witnesses and to take testimony
under oath, or by any Governmental Authority that is a party in interest in, and is seeking testimony
concerning the award of, or the performance under, any transaction, agreement, lease, permit,
contract or license entered into with the City, the State, or any political subdivision thereof, or any
local development corporation; then Lessor or any representative of Lessor that Lessor deems
appropriate (any such party being the “Lessor Representative”) may convene a hearing, upon not
less than ten (10) days of prior written notice to the parties involved, which shall include Lessee,
to determine if any penalties should attach for the failure of a person to testify.
Section 32.10. If Lessee or any officer, employee or agent of CPLP or NROC requests an
adjournment in any proceeding investigating the events surrounding the negotiation and
consummation of this Lease of up to thirty (30) days, such adjournment shall be granted. If a
further adjournment is sought by Lessee or any officer, employee or agent of CPLP or NROC it
must be done by a written request to the agency head or commissioner who convened the hearing,
at least three (3) Business Days prior to the scheduled hearing date, setting forth the reasons for
the request. If the commissioner or agency head denies the request for an additional adjournment,
then Lessee, or the officer, employee or agent of CPLP or NROC must appear at the scheduled
hearing or commence an action to obtain a court order, pursuant to Article 78 of the Civil Practice
Laws and Rules, substantiating a claim that the denial of the adjournment was capricious or
arbitrary. If Lessee fails to appear at the rescheduled hearing or to diligently pursue such judicial
relief or CPLP or NROC fails to instruct its applicable officer, employee or agent to appear at the
rescheduled hearing or to diligently pursue such judicial relief and CPLP or NROC fails to take
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reasonable and lawful steps to compel such officer, employee or agent to do so, as the case may
be, then Lessor may deem that Lessee has failed to observe or perform a covenant or agreement of
this Lease on Lessee's part to be performed or observed and hence find Lessee in Default pursuant
to Article 22.1(c).
Section 32.11. Lessee acknowledges that the penalties that may attach after the final
determination by the applicable Governmental Authority that Lessee or any officer, employee or
agent of CPLP or NROC has committed an action described in Section 32.9 may include, but shall
not exceed:
(a) The disqualification for a period not to exceed five (5) years from the date of any
adverse determination for any person which such person was a member, shareholder, officer,
director, employee or agent of Lessee or Chelsea Piers Management, Inc. at the time the testimony
was sought, from submitting bids for, or transacting business with, or entering into or obtaining
any contract, lease, permit or license with or from Lessor; and/or
(b) The cancellation or termination of any and all existing contracts, leases, permits or
licenses with Lessor that the refusal to testify concerns and that have not been assigned as permitted
under this Lease, nor the proceeds of which have been pledged to a senior Mortgagee for fair value
prior to the issuance of the notice scheduling the hearing, without Lessor incurring any penalty or
damages on account of such cancellation or termination.
Section 32.12. (a) The Lessor Representative shall consider or address in reaching his
or her other determination and in assessing an appropriate penalty the factors in subparagraphs (b)
and (c) of this Section 32.12. He or she may also consider, if relevant and appropriate, the criteria
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established in subparagraphs (d) and (e) of this Section 32.12, in addition to any other information
which may be relevant and appropriate.
(b) The Lessee’s or other applicable party’s good faith endeavors or lack thereof to
cooperate fully and faithfully with any governmental investigation or audit including, but not
limited to the discipline, discharge, or disassociation of any person failing to testify, the production
of accurate and complete books and records, and the forthcoming testimony of all other members,
agents, assignees or fiduciaries of Lessee or Chelsea Piers Management, Inc. whose testimony is
sought.
(c) The relationship of the person who refused to testify to Lessee or any other entity
that is a party to the hearing, including, but not limited to, whether the person whose testimony is
sought has an ownership interest in the entity and/or the degree of authority and responsibility the
person has within the entity.
(d) The nexus of the testimony sought to Lessee or any other subject entity and its
contracts, leases, permits or licenses.
(e) The effect a penalty may have on an unaffiliated and unrelated party or entity that
has a significant interest in a party or entity subject to penalties under Section 32.11 above,
provided that the party or entity has given actual notice to the Lessor Representative upon the
acquisition of the interest, or at the hearing called for in Section 32.9 above gives notice and proves
that such interest was previously acquired. Under either circumstance the party or entity must
present evidence at the hearing demonstrating the potential adverse impact such a penalty would
have on such person or entity.
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Section 32.13. (a) For the purposes of this Article 32, the following terms will have the
meanings set forth below. Capitalized terms utilized, but not otherwise defined below, will have
the meanings assigned to such terms elsewhere in this Lease.
(b) The term “license” or “permit” as used herein shall be defined as a license, permit,
franchise or concession not granted as a matter of right.
(c) The term “person” as used herein shall be defined as any natural person doing
business alone or associated with another person or entity as a partner, director, officer, principal
or employee.
(d) The term “entity” as used herein shall be defined as any firm, partnership,
corporation, association or person that receives monies, benefits, licenses, leases or permits from
or through Lessor, the City or the State or otherwise transacts business with such governmental
agencies.
(e) The term “member” as used herein shall be defined as any person associated with
any other person or entity as a partner, director, officer, principal or employee.
Section 32.14. In addition to, and notwithstanding any other provision of this Lease, the
Lessor Representative may, at his or her discretion, (x) terminate this Lease upon prior written
notice to Lessee in the event that, after at least ten (10) days’ notice and an opportunity for Lessee
to be heard, the Lessor Representative determines that Lessee failed to promptly report in writing
to the Lessor Representative, any solicitation from Lessee of money, goods, requests for future
employment or other benefit or thing of value, which request was made by or on behalf of any
employee of Lessor, or other person, firm, corporation or entity for any purpose which may be
related to the procurement or obtaining of this Lease by Lessee, or affecting the performance of
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Lessee’s obligation under this Lease or (y) declare that Lessee failed to observe or perform a
covenant or agreement of this Lease on Lessee's part to be performed or observed and hence find
Lessee in Default pursuant to Article 22.1(c), in which case Lessee may cure such default by
removing such officer, member or employee of Lessee and cause such individual to divest himself
or herself of any direct or indirect interest in Lessee.
INVALIDITY OF CERTAIN PROVISIONS
If a court of competent jurisdiction shall make a final determination that any term or
provision of this Lease or the application thereof to any Person or circumstances is, to any extent,
invalid or unenforceable, the remainder of this Lease, or the application of such term or provision
to Persons or circumstances other than those as to which it is held invalid or unenforceable, shall
not be affected thereby, and each term and provision of this Lease shall be valid and be enforced
to the fullest extent permitted by law.
SUBLEASE
Notwithstanding the reference to this document as a “lease” and the reference to the Lessor
under this as “Lessor”, Lessor is the tenant of the Premises and other property pursuant to the State
Lease. Lessor has submitted to Lessee a true and complete copy of the State Lease and shall
promptly submit to Lessee any modifications or amendments thereof during the Term. Lessee
shall not do or omit any act which would constitute a violation of, or default under, the State Lease.
In the event that the State’s interest in the State Lease is transferred or assigned to a third party
that is not a governmental agency or deemed to be a governmental agency, then Lessor shall
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request a non-disturbance agreement on behalf of any sublessee with whom Lessor, Lessee and
such sublessee have entered into a non-disturbance agreement, which non-disturbance agreement,
if any, shall be in a form reasonably acceptable to Lessor, Lessee, such sublessee and the State’s
successor-in-interest as overlandlord under the State Lease.
RECORDING OF MEMORANDUM
Either Lessor of Lessee may record this Lease or any amendment of this Lease. Each shall,
upon the request of the other, join in the execution of a memorandum of this Lease or a
memorandum of any amendment of this Lease in proper form for recordation. All costs in
recording a memorandum of Lease shall be paid by Lessee.
NON-DISCRIMINATION AND AFFIRMATIVE ACTION
Section 36.1. Lessee shall be required to comply, and will cause all contractors and
subcontractors engaged to perform alterations in the Premises to agree to comply, with the
provisions of Article 15 of the New York State Executive Law which mandates that contractors
and subcontractors will not engage in any unlawful discrimination against any employee or
applicant for employment because of age, race, creed, color, national origin, sex, disability, gender
identity or expression, military status, marital status, predisposing genetic characteristics, familial
status, domestic violence victim status, or sexual orientation with respect to all employment
decisions. Contractors and subcontractors engaged for such work may also be subject to local
provisions mandating a specified participation by trainees.
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Section 36.2. Lessee agrees to make commercially reasonable efforts to provide
notification of employment opportunities at the Premises through the website of Manhattan
Community Board 4, in substantially the same manner as Lessee and Lessor provide as of the date
hereof (and provided that the website of Manhattan Community Board 4 continues to offer the
opportunity to Lessee to provide such notification in such manner).
Section 36.3. Lessee shall make commercially reasonable efforts to encourage the
participation of New York State business enterprises as suppliers and subcontractors, including
minority and women-owned business enterprises certified by the State and City, at the Premises,
and will retain the documentation of these efforts.
Section 36.4. Lessee shall comply with the Federal Equal Opportunity Act of 1972 (P.L.
92-261), as amended, to the extent that such act applies to Lessee.
Section 36.5. Lessee shall make commercially reasonable efforts to reduce its carbon
footprint and greenhouse gas emissions by analyzing and undertaking, as feasible, commercially
reasonable measures.
SECURITY DEPOSIT; BOND
Section 37.1. (a) As security for the faithful performance and observance by Lessee
of the terms, provisions and conditions of the Original Lease, as contemplated by the RDRA,
Lessee has provided to Lessor cash in the amount of $157,000, and Lessor shall continue to hold
this cash security deposit as security for the faithful performance and observance by Lessee of the
terms, provisions and conditions of this Lease. In addition, on or before the Execution Date, Lessee
has delivered to Lessor one or more (i) irrevocable standby letters of credit drawable by Lessor
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and reasonably acceptable to Lessor, or (ii) surety bonds reasonably satisfactory to Lessor (the
items described in clauses (i) and (ii) collectively, the “Letter of Credit”) in the combined amount
of $500,000 (the cash and the Letters of Credit totaling $657,000, as such amount may be
increased in accordance with Section 37.1(b), to be referred to collectively as the “Security
Deposit”) securing the performance by Lessee of the terms, provisions and conditions of the
Original Lease. On or prior to the Commencement Date, Lessee shall deliver to Lessor one or
more irrevocable standby Letter(s) of Credit drawable by Lessor and reasonably acceptable to
Lessor that either amend or replace the Letter(s) of Credit delivered prior to the Execution Date
such that such Letter(s) of Credit expressly refer to this Lease and are drawable by Lessor upon
and during the continuation of an Event of Default under this Lease, or upon Lessee’s failure to
deliver to Lessor a replacement Letter of Credit within the time period set forth in the last sentence
of Section 37.1(b).
(b) Each Letter of Credit delivered as a Security Deposit shall be in a form reasonably
acceptable to Lessor (it being understood that unless Lessor waives the conditions in consenting
to a Letter of Credit, such consent not to be unreasonably withheld or delayed, any Letter of Credit
must (w) be transferable to a successor to Lessor’s interest in this Lease that is permitted by the
terms hereof with all transfer fees being borne by Lessee, (x) upon and during the continuation of
an Event of Default under this Lease or upon Lessee’s failure to deliver to Lessor a replacement
Letter of Credit within the time period set forth in the last sentence of this paragraph (b), be
drawable by Lessor at a banking office of the issuing bank that is located in New York City or by
some other means that does not require Lessor to travel from New York City in order to draw
down the Letter of Credit, (y) obligate the issuing bank to provide Lessor with no less than thirty
(30) days’ prior written notice (by means of receipted delivery) if the Letter of Credit is not being
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renewed upon expiration, and (z) be otherwise reasonably acceptable to Lessor), and shall be
issued by and drawn on a commercial bank acceptable to Lessor in its reasonable discretion and at
a minimum having a long-term issuer credit rating from Standard & Poor’s Professional Rating
Service of A or a comparable rating from Moody’s Professional Rating Service. If the issuer’s
credit rating is reduced below A, or if the financial condition of such issuer changes in any other
materially adverse way, then Lessor shall have the right to require that Lessee obtain from a
different issuer a replacement Letter of Credit that complies in all respects with the requirements
of this Section within twenty (20) Business Days following Lessee’s written demand. In any event,
Lessee shall, not later than thirty (30) days prior to the expiration of the term of any Letter of Credit
or any replacement Letter of Credit, deliver to Lessor a replacement Letter of Credit such that one
or more Letters of Credit shall be in effect at all times after the date of the initial Letter of Credit
until thirty (30) days beyond the end of the Term, and if Lessee fails to deliver a replacement Letter
of Credit within such time period, Lessor shall be entitled to draw down the Letter of Credit and
hold the proceeds as a cash security deposit in accordance with the terms of this Lease.
(c) From and after the ninth Lease Year, the nineteenth Lease Year and the
twenty-ninth Lease Year, the required amount of the Security Deposit shall increase such that it
equals twice the monthly Fixed Base Rent for such Lease Year, and Lessee shall on or prior to the
first day of each such Lease Year deliver to Lessor any shortfall against the Security Deposit as
cash, a replacement Letter of Credit, or an amended Letter of Credit drawable by Lessor or a surety
bond reasonably satisfactory to Lessor.
Section 37.2. Lessee agrees that upon and during the continuance of an Event of
Default, Lessor may use the entire amount, or any part thereof, of the Security Deposit and apply,
or retain the whole or any part of such proceeds, as the case may be, to the extent required for the
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payment of any Rental or any other sum as to which Lessee is in default, or for any sum that Lessor
may expend or may be required to expend by reason of the Event of Default (including any
damages or deficiency accrued before or after summary proceedings or other re-entry by Lessor).
If Lessor shall so apply any funds, Lessee shall, within twenty (20) business days following
Lessor’s written demand, restore the Security Deposit to the full amount required pursuant to
Section 37.1. Failure by Lessee to comply with the provisions of this Section 37.2 shall constitute
an Event of Default, and shall be governed by the provisions of Section 22.1(b).
Section 37.3. Provided that Lessee shall fully and faithfully comply with all of the
terms, covenants and conditions of this Lease, the Security Deposit shall be returned to Lessee
promptly after the Expiration Date and after delivery of the Premises to Lessor as required by this
Lease. In the event of a sale or a permitted assignment of this Lease by Lessor, Lessor shall have
the right to transfer the Security Deposit to the vendee or transferee and this Article 37 shall apply
to every transfer or assignment made of the Security Deposit to a new lessor, provided that Lessor
shall give Lessee prior notice of any such assignment.
Section 37.4. The provisions of this Article 37 shall survive the expiration or sooner
termination of this Lease.
REPORTS, BOOKS AND RECORDS, INSPECTION AND AUDIT
Section 38.1. [Reserved].
Section 38.2. (a) Lessee shall establish and maintain adequate systems of internal
controls, which it shall, upon reasonable prior written request by Lessor, describe in writing to
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Lessor and make available for inspection by Lessor to validate such description at reasonable times
during regular business hours (provided that such validation does not result in disclosure to Lessor
of any information that Lessee would not be required to disclose pursuant to the other provisions
of this Article 38).
(b) Lessee shall keep and maintain at the Premises and make available for
inspection by Lessor complete and accurate adequate records, books of account and data relating
to the calculation of Gross Revenues for each Lease Year and the preparation of the Annual CPA
Statements pursuant to Section 3.3(h) and related reports and statements as set forth in Section
3.3(i) for a period of not less than six (6) years following the end of each Lease Year; provided,
however, if, at the expiration of such six (6) year period with respect to any Lease Year, a
Reviewing Party is seeking to contest or is contesting any matter relating to the calculation of
Gross Revenues, Lessee shall preserve such records with respect to the Lease Year(s) in question
until one (1) year after the final adjudication, settlement or other disposition of any such contest.
If the Comptroller of the State, however, establishes a policy allowing the City to provide in future
leases similar to this Lease for the right of a Reviewing Party to audit an Annual CPA Statement
for a period that is less than six (6) years after the date of such Annual CPA Statement, then such
shorter period shall be applicable to the audit rights contained in this Lease but in no event shall a
Reviewing Party have less than one (1) year after the date of an Annual CPA Statement to give a
notice to Lessee to audit Lessee’s books and records on the terms and provisions contained herein.
All such books and records maintained pursuant to this Lease shall be conveniently segregated
from other business matters of the Lessee.
(c) Lessee shall keep and maintain at the Premises and make available for
inspection by Lessor (i) Lessee’s annual audited financial statement for any Lease Year for which
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an Annual CPA Statement was delivered to Lessor and (ii) the NYCDOF Income and Expense
Statement delivered to the NYCDOF by Lessee from the Commencement Date until such date as
the tax lot merger or subdivision process is completed as set forth in Section 3.5(c).
Section 38.3. Lessor, the Comptroller of the City and the Comptroller of the State
(collectively, the “Reviewing Parties” or, individually, a “Reviewing Party”) and their accountants,
agents and representatives shall have the right, at the Reviewing Party’s sole cost and expense
(except as otherwise provided herein), from time to time during regular business hours upon at
least ten (10) days prior written notice to Lessee, to inspect and/or audit Lessee’s books, records,
statements, papers and files relating solely to information required to be set forth in the Annual
CPA Statement. Lessee shall produce all such books, records, statements, papers and files
promptly following Lessee’s receipt of such notice for inspection at the Premises or at Lessee’s
principal place of business in the City. Subject to applicable law, all information obtained from
Lessee’s books, records, statements, papers and files, including, without limitation, the amount of
Gross Revenue, shall be held in strict confidence, except that Lessor may disclose such information
to its attorneys, consulting professionals and accountants to the extent necessary for the
enforcement of Lessor’s rights under this Lease, provided that each of such recipients shall be
bound to the same non-disclosure provisions as are imposed upon Lessor and each other
Reviewing Party. If an audit performed by a Reviewing Party or their agents or representatives
discloses that Gross Revenue was understated, then Lessor shall give notice to Lessee of such
determination, and Lessor, the Reviewing Party and Lessee shall during a period of no less than
thirty (30) days consult together to determine whether in fact such understatement existed. If at
the end of such period of consultation the Reviewing Party continues to believe that an
understatement of Gross Revenue existed, Lessor shall give notice to Lessee of such belief, and
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the parties shall have a further period of thirty (30) days in which to seek to reach agreement. If
the parties are still unable to reach agreement, the matters shall be determined by expedited
arbitration in accordance with the provisions of Article 32. If Lessee accepts a determination by a
Reviewing Party that an understatement of Gross Revenue existed, or if it is the determination of
the arbitrator that an understatement of Gross Revenue existed, then for purposes of this Lease
such understatement shall be deemed to exist (such an understatement of Gross Revenues is
referred to as a “Determined Understatement”) , and Lessee shall pay to Lessor, within thirty (30)
days after the determination of a Determined Understatement, an amount equal to amount of Fixed
Base Rent that was underpaid as a result of such Determined Understatement, and, if a Determined
Understatement determines that Gross Revenue was understated by Lessee by more than five
percent (5%), then (x) Lessee shall also pay the fees incurred by the Reviewing Party in connection
with the performance of such audit, and (y) the payment to be made to Lessor as a result of such
understatement shall bear interest at the Applicable Rate, from the date such amount was due under
this Lease until payment thereof is received by Lessor, which interest shall be calculated on a
monthly compounded basis. If an audit performed by a Reviewing Party or their agents or
representatives discloses that Gross Revenue was overstated, then Lessor shall credit the excess
Fixed Base Rent paid as a result of such overstatement against the next payment of Fixed Base
Rent becoming due under this Lease (or shall pay such excess amount to Lessee if the Term has
expired).
Section 38.4. Lessor may, upon at least three (3) days prior written notice to Lessee,
inspect (a) Lessee’s Redacted Audited Financial Statements for any Lease Year for which an
Annual CPA Statement was delivered to Lessor and (b) the NYCDOF Income and Expense
Statement delivered to the NYCDOF by Lessee from the Commencement Date until such date that
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is the earlier of (i) the third anniversary of the Commencement Date or (ii) the date on which the
tax lot merger or subdivision process described Section 3.5(c) is completed (the “Inspection
Documents”). Such inspection shall take place at the business office of Lessee at the Premises and
be conditioned upon (i) Lessor not photocopying or otherwise making copies of the Inspection
Documents (though Lessor’s representatives shall be allowed to take notes), (ii) Lessor not
removing the Inspection Documents from the Premises, and (iii) Lessor treating the Inspection
Documents (and any notes taken by Lessor’s representatives) as Lessee’s Confidential
Information.
Section 38.5. The obligations of Lessee under this Article 38 shall survive the expiration
of the Term.
MISCELLANEOUS
Section 39.1. The captions of this Lease are for convenience of reference only and in no
way define, limit or describe the scope or intent of this Lease or in any way affect this Lease.
Section 39.2. The Table of Contents is for the purpose of convenience of reference only
and is not to be deemed or construed in any way as part of this Lease or as supplemental thereto
or amendatory thereof.
Section 39.3. The use herein of the neuter pronoun in any reference to Lessor or Lessee
shall be deemed to include any individual lessor or Lessee, and the use herein of the words
“successors and assigns” or “successors or assigns” of Lessor or Lessee shall be deemed to include
the heirs, legal representatives and permitted assigns of any individual lessor and Lessee.
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Section 39.4. Depository may pay to itself out of the monies held by Depository pursuant
to this Lease its reasonable charges for services rendered hereunder. Lessee shall pay Depository
any additional charges for such services. Depository will be instructed to hold amounts paid to it
in an interest-bearing account.
Section 39.5. If more than one entity is named as or becomes lessee or lessor hereunder,
each party may require the signatures of all such entities in connection with any notice to be given
or action to be taken by the other hereunder except to the extent that any such entity designates
another such entity to act on its behalf, which designation shall be effective until receipt by a party
of notice of its revocation. Each entity named as Lessee and Lessor shall be fully and jointly and
severally liable for all of the respective obligations hereunder. Any notice by each party to any
entity named as Lessee or Lessor shall be sufficient and shall have the same force and effect as
though given to all parties named as Lessee or Lessor. If all such parties designate in writing one
entity to receive copies of all notices, each party agrees to send copies of all notices to that entity.
Section 39.6. (a) The liability of Lessor or of any Person who has at any time acted
as the Lessor hereunder for damages or otherwise shall be limited to Lessor’s interest in the
Premises, including, without limitation, the rents and profits therefrom, the proceeds of any
insurance policies covering or relating to the Premises, any awards payable in connection with any
condemnation of the Premises or any part thereof, and any other rights, privileges, licenses,
franchises, claims, causes or action or other interests, sums or receivables appurtenant to the
Premises. Neither Lessor nor any such Person nor any of the members, directors, officers,
employees, agents or servants of either shall have any liability (personal or otherwise) hereunder
beyond Lessor’s interest in the Premises, and no other property or assets of Lessor or any such
Person or any of the members, directors, officers, employees, agents or servants of either shall be
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subject to levy, execution or other enforcement procedure for the satisfaction of Lessee’s remedies
hereunder. Each party hereto, for itself and its successors and assigns, waives and covenants not
to assert (such waiver and covenant to survive the expiration or earlier termination of this Lease)
any claim or enforcement procedure against, or levy or execution upon, any member, director,
officer, employee, agent or servant of the other party.
(b) The liability of Lessee hereunder for damages or otherwise shall be limited to
Lessee’s interest in the Premises and this Lease, including, without limitation, the rents, issues and
profits therefrom, the proceeds of any insurance policies covering or relating to the Premises, any
awards payable in connection with any condemnation of the Premises or any part thereof, the
amounts received or receivable by Lessee in connection with a sale, Transfer or assignment of
Lessee’s interest in the Premises or this Lease to the extent that such amounts have not been
distributed by Lessee, and any other rights, privileges, licenses, franchises, claims, cause of action
or other interest, sums or receivables appurtenant to the Premises. Neither Lessee nor any partners
comprising Lessee shall have any liability (personal or otherwise) hereunder beyond Lessee’s
interest in the Premises and this Lease, and no other property or assets of Lessee or any of the
aforesaid Persons shall be subject to levy, execution or other enforcement procedure for the
satisfaction of Lessor’s remedies hereunder. At no time shall (i) any limited partners, stockholders,
directors, officers, employees, agents or servants of Lessee or of any Person comprising Lessee,
or (ii) if Lessee is a general partnership, any Person who is a minority partner of Lessee, have any
liability (personal or otherwise) hereunder beyond Lessee’s interest in the Premises and this Lease,
and no other property or assets of such Persons shall be subject to levy, execution or other
enforcement procedure for the satisfaction of Lessor’s remedies under this Lease or at law or in
equity.
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Section 39.7. Except as otherwise expressly provided in this Lease, there shall be no
merger of this Lease or the leasehold estate created hereby with the fee estate in the Premises or
any part thereof by reason of the same Person acquiring or holding, directly or indirectly, this
Lease or the leasehold estate created hereby or any interest in this Lease or in such leasehold estate
as well as the fee estate in the Premises.
Section 39.8. Lessee shall store all refuse from the Premises off the streets in accordance
with the requirements of municipal and/or private sanitation services serving the Premises.
Section 39.9. Each of the parties represents to the other that it has not dealt with any
broker, finder or like entity in connection with this transaction. If any claim is made by any Person
who claims to have acted or dealt with Lessee or Lessor in connection with this transaction, Lessee
or Lessor, as the case may be, will pay the brokerage commission, fee or other compensation to
which such Person is entitled, shall indemnify and hold harmless the other party hereto against any
valid claim asserted by such Person for any such brokerage commission, fee or other compensation
and shall reimburse such other party for any costs or expenses including, without limitation,
reasonable attorneys’ fees and disbursements, incurred by such other party in defending itself
against valid claims made against it for any such brokerage commission, fee or other
compensation.
Section 39.10. This Lease may not be changed or terminated orally, but only by a written
agreement executed by the party against whom enforcement of any such change or termination is
sought.
Section 39.11. This Lease shall be governed by and construed in accordance with the laws
of the State of New York.
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Section 39.12. The agreements, terms, covenants and conditions herein shall be binding
upon, and shall inure to the benefit of, Lessor and Lessee and their respective successors and
permitted assigns.
Section 39.13. All references in this Lease to “Articles” or “Sections” shall refer to the
designated Article(s) or Section(s), as the case may be, of this Lease.
Section 39.14. Subject to a Mortgagee’s rights, all of Lessee’s right, title and interest in all
plans and drawings required to be furnished by Lessee to Lessor under this Lease, including,
without limitation, the Construction Documents, and in all other plans, drawings, specifications or
models prepared in connection with construction at the Premises, any Restoration, any Capital
Improvement and any Non-Approvable Construction Project, but excluding, in each case, such
plans and drawings to the extent that they relate to Trade Fixtures, shall become the sole and
absolute property of Lessor upon the Expiration Date or any earlier termination of this Lease.
Lessee shall deliver all such items to Lessor promptly upon the Expiration Date or any earlier
termination of this Lease.
Section 39.15. All references in this Lease to “licensed professional engineer,” “licensed
surveyor” or “licensed architect” shall mean a professional engineer, surveyor or architect who is
licensed in New York.
Section 39.16. If Lessor or any successor to its interest hereunder ceases to have any
interest in the Premises or there is at any time or from time to time any valid sale or transfer of
Lessor’s interest in the Premises, the seller or transferor shall be and hereby is entirely freed and
relieved of all agreements, covenants and obligations of Lessor hereunder to be performed on or
after the date of such sale or transfer relative to the interest sold or transferred, and it shall be
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deemed and construed without further agreement between the parties or their successors in interest
or between the parties and the Person who acquires or owns the Premises including, without
limitation, the purchaser or transferee in any such sale or transfer, that, subject to the provisions of
Section 39.6, such Person has assumed and agreed to carry out all agreements, covenants and
obligations of Lessor hereunder accruing from and after the date of such sale or transfer.
Section 39.17. If Lessee or any successor to its interest hereunder ceases to have any
interest in the Premises or if there is at any time or from time to time any valid sale or Transfer of
the Lessee’s or any successor’s interest in the Premises in accordance with the provisions of Article
8, the seller or transferor shall be and hereby is entirely freed and relieved of all agreements,
covenants and obligations of Lessee hereunder to be performed from and after the date of such
sale or Transfer relative to the interest sold or transferred, and it shall be deemed and construed
without further agreement between the parties or their successors in interest that, subject to the
provisions of Article 8, such Person has assumed and agreed to carry out all agreements, covenants
and obligations of Lessee hereunder accruing from and after the date of such sale or Transfer.
Section 39.18. Nothing herein is intended nor shall be deemed to create a joint venture or
partnership between Lessor and Lessee, nor to make Lessor in any way responsible for the debts
or losses of Lessee.
Section 39.19. To the extent permitted by law, Lessee shall, at its sole option, have the right
to all depreciation deductions, investment tax credits and other similar tax benefits attributable to
any construction, demolition and Restoration performed by Lessee or attributable to the ownership
of the Improvements under the Original Lease as well as under this Lease. Lessor, from time to
time, shall execute and deliver such instruments as Lessee reasonably requests in order to effect
the provisions of this Section 39.19, and Lessee shall pay Lessor’s reasonable costs and expenses
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thereof. Lessor makes no representations as to the availability of any such deductions, credits or
tax benefits.
Section 39.20. Whenever Lessor has the right to approve the architect or engineer to be
employed by Lessee, any architect or engineer approved by Lessor at any time during the Term
shall be deemed to be acceptable to Lessor for employment by Lessee at any time thereafter, unless
Lessor has good cause for refusing to allow the continued employment of such consultant. If Lessor
refuses to approve the continued employment of such consultant, it shall so notify Lessee,
specifying the reason therefor.
Section 39.21. Lessee shall not have the right to use the name of Lessor and/or the State or
any similar name in any advertising and promotional materials in connection with the subleasing
of the Improvements, except as set forth in Section 39.26.
Section 39.22. The State, for the benefit of itself, shall have the right of access and passage
for vessels along, upon and across the water of any berthing area or any part thereof, to the extent
only that such right may be exercised without unreasonably interfering with the business of Lessee
or its Sublessees or use of the Premises by Lessee or its Sublessees.
Section 39.23. (a) Lessor shall own and control any and all Excess Development Rights
that are available for the Premises in accordance with the terms of this Lease. Lessee may request
that Lessor allocate Lessee’s Available Development Rights subject to Lessee’s meeting all
requirements set forth in Section 21.1(w) of this Lease.
(b) Lessor confirms that as of the Commencement Date Lessor shall retain no less than
100,000 square feet of Excess Development Rights. Upon request by Lessor, Lessee shall execute
such waiver and release that is required for Lessor to sell Excess Development Rights to a receiving
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site other than the Premises pursuant to Section 89-21(d) of the Zoning Resolution of the City of
New York and the Hudson River Park Act as amended in 2013, provided that Lessor retains (i.e.,
does not convey or propose to convey) not less than (i) 100,000 square feet of Excess Development
Rights (as such amount may be reduced from time to time by any usage by Lessee of Lessee’s
Available Development Rights in accordance with the terms set forth herein) for a period of not
less than thirty (30) years from the Commencement Date and (ii) as of the thirtieth anniversary of
the Commencement Date and through such date that is five years prior to the Expiration Date, the
lesser of (x) 20,000 square feet of Excess Development Rights and (y) the difference, if positive,
between 100,000 square feet of Excess Development Rights and the number of square feet of
Excess Development Rights used by Lessee pursuant to clause (i) of this definition, in the case of
each of (x) and (y) as such amount may be reduced from time to time by Lessee’s use of Lessee’s
Available Development Rights.
Section 39.24. Lessor acknowledges and agrees that Lessor shall have no right to use the
names “Chelsea Piers”, “Skyrink” or “Sky Rink” at the Premises during the Lease Term or after
the Expiration Date. Lessor acknowledges and agrees that Lessee (and/or its permitted subtenants)
shall have the right to use the names “Chelsea Piers”, “Skyrink” or “Sky Rink” at the Premises.
Section 39.25. Intentionally Omitted.
Section 39.26. Unless specifically directed to the contrary by Lessor, Lessee itself will and
will request each Occupant under a Sublease or Occupancy Agreement covering leasable units in
the Premises to identify its location as being within Hudson River Park in all literature, brochures,
handouts, advertising and other publicity information in which the location of its operations at the
Premises is referred to.
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Section 39.27. This Lease may be executed in one or more counterparts which, when taken
together, shall constitute one and the same.
Section 39.28. Lessor acknowledges that Lessee and other Persons in connection with this
Lease have provided and will be hereafter providing Lessee’s Confidential Information, including
trade secrets and proprietary information, the disclosure of which may be harmful to Lessee’s
competitive position. Accordingly, Lessor agrees that it shall maintain the confidentiality of
Lessee’s Confidential Information; provided that if disclosure requests are received by Lessor
pursuant to the Freedom of Information Law or any judicial or legislative subpoena, or any
legislative or other regulatory bodies’ oversight responsibilities, which in any such case requests
any of Lessee’s Confidential Information, Lessor shall give Lessee prompt prior notice and the
opportunity to object to such Freedom of Information Law or other request or subpoena and Lessor
shall cooperate to the extent permitted by law with any efforts or actions of Lessee to maintain the
confidentiality of such Confidential Information through a protective order or other lawful means
(it being understood and agreed that after such notice and, if so requested by Lessee, after affording
Lessee the longest time permitted under the Freedom of Information Law or other applicable law
to obtain a protective order or other lawful protection of such Confidential Information, Lessor
shall have the right to make disclosures believed in good faith to be required under the Freedom
of Information Law or other applicable law notwithstanding any objection of Lessee). In the event
such legally compelled disclosure is made as permitted hereunder, Lessor shall continue in all
other ways to maintain the confidentiality of Lessee’s Confidential Information as required by this
Section 39.28. Lessee understands and acknowledges that Lessor is a public authority of the State
of New York and is subject to review and oversight by legislative and other regulatory bodies, and
that Lessor is required by law and may be compelled or requested by such oversight bodies to
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make public disclosure of information regarding this Lease, and shall be fully entitled to do so
without objection from Lessee, except as otherwise provided in this Section 39.28. Nothing
contained herein shall prevent Lessor from disclosing such information to an arbitrator in the
course of any expedited arbitration pursuant to Article 32 or any legal proceeding commenced by
Lessor to enforce its rights under this Lease.
Section 39.29. (a) The term “Commencement Date” shall mean the date that is four (4)
months after the date of the execution of this Lease; provided that in the event that there is a lawsuit
filed within four (4) months after the date of the execution of this Lease by a third party other than
a party that Controls, is Controlled by or is under common Control with Lessee, which lawsuit (x)
results in a temporary restraining order and/or preliminary injunction (“TRO/PI”) being issued by
a court of competent jurisdiction against Lessee and/or Lessor and/or (y) seeks relief which, if
granted: (I) has the effect of Lessee and/or Lessor being denied the right to proceed with this
Lease, (II) in the sole but reasonable judgment of Lessor, materially adversely affects the rights or
obligations of Lessor under this Lease or (III) in the sole but reasonable judgment of Lessee,
materially adversely affects the rights or obligations of Lessee or a Mortgagee under this Lease
(such lawsuit satisfying one or more of the conditions set forth in this Section 39.29(a), a “Major
Lawsuit”), then, as a result of such Major Lawsuit, the Commencement Date shall be delayed and
the term “Commencement Date” shall have the meaning provided in Section 39.29(b).
(b) In the event that there is a Major Lawsuit, Lessor and Lessee shall cooperate and
may mutually decide, each in its sole discretion, in response to such litigation to: (i) modify the
terms of this Lease, including deleting or modifying the challenged provision, and execute a new
lease subject to any applicable Requirements; or (ii) seek to settle the Major Lawsuit; or (iii) defend
against the Major Lawsuit, subject to Lessee reimbursing Lessor its reasonable out of pocket
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litigation expenses within thirty (30) days of receipt of Lessor’s reimbursement request
accompanied by supporting documentation reasonably satisfactory to Lessee (such expenses,
“Section 39.29 Reimbursable Expenses”), and in such event the term “Commencement Date” shall
mean the date on which: (x) the Major Lawsuit has been withdrawn or discontinued or a final non-
appealable decision has been rendered by a court of competent jurisdiction that is favorable to
Lessee and/or Lessor that affirms that the Lease may remain in effect in accordance with its terms;
or (y) in the event that there is no TRO/PI, Lessee notifies Lessor in writing that Lessee has
determined in its sole and absolute discretion that, notwithstanding that the Major Lawsuit may
not have been finally resolved, that Lessor and Lessee should proceed with this Lease, and Lessee
indemnifies and defends Lessor, in writing, with respect to claims and liabilities to which Lessor
may be subject as a result of proceeding with this Lease in an indemnity agreement that is
satisfactory to Lessor in Lessor’s sole discretion. In no event shall the Original Lease or the RDRA
terminate as a result of the execution of this Lease unless and until the Commencement Date has
occurred in accordance with the terms of the preceding sentence.
(c) Should the Commencement Date not occur within three (3) years after the
Execution Date as set forth herein, then either (i) provided that Lessee has paid on a timely basis
and continues at all times to pay all of Lessor’s Section 39.29 Reimbursable Expenses on a timely
basis, Lessor and Lessee may mutually decide, each in its sole discretion, to continue to defend
the Major Lawsuit for an additional time period mutually agreed to by Lessor and Lessee in writing
(hereafter “Outer Litigation Date”) or, alternately, modify provisions of this Lease to take into
account the length of the postponement; or, alternately, (ii) either Lessor or Lessee may elect by
Notice given to the other not to proceed with this Lease in which case (1) the Original Lease and
the RDRA shall continue in full force and effect, (2) this Lease shall be deemed void ab initio. If
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the parties have agreed to an Outer Litigation Date, and if the Commencement Date has not
occurred prior to the expiration of the Outer Litigation Date, and Lessor and Lessee each agree
that a non-appealable decision by a court of competent jurisdiction in favor of Lessor or Lessee is
likely to occur in the near future, Lessor and Lessee may mutually agree in writing, each in its sole
discretion, to extend the Outer Litigation Date subject to the same conditions and provisions set
forth in the preceding sentence. Should a final non-appealable decision be rendered by a court of
competent jurisdiction that (I) denies to Lessor and/or Lessee the right to proceed with this Lease,
(II) in the sole but reasonable judgment of Lessor, materially adversely affects the rights or
obligations of Lessor under this Lease or (III) in the sole but reasonable judgment of Lessee,
materially adversely affects the rights or obligations of Lessee or a Mortgagee under this Lease,
the Commencement Date shall be deemed not to have occurred and in such case (i) the Original
Lease and the RDRA shall continue in full force and effect, and (ii) upon the date the decision
becomes final and non-appealable, this Lease shall be deemed void ab initio, and neither party
shall thereafter have any liability to the other under this Lease, except that Lessee’s obligation to
reimburse Lessor for its Section 39.29 Reimbursable Expenses shall survive the termination of this
Lease, and Lessee agrees that its failure to satisfy such obligation shall be deemed a default under
the Original Lease. If Lessee appeals any decision rendered in a Major Lawsuit, and Lessee
determines not to prosecute such appeal to completion, Lessee shall give notice of such
determination to Lessor and thereupon such decision shall be deemed to be non-appealable for
purposes of this Section 39.29.
(d) Intentionally omitted.
(e) Anything to the contrary in this Lease notwithstanding, unless and until the
Commencement Date shall have occurred, the Original Lease, the RDRA and any agreement
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entered into between the parties with respect to the Original Lease and the RDRA shall continue
in full force and effect.
Section 39.30. The design, bidding and construction of any construction or repairs made
by Lessee in accordance with the provisions of this Lease, including but not limited to Public
Access Improvements, Capital Improvements, Non-Approvable Construction Projects and Pier
Repair Work, shall be bid and proceed as private construction, subject to all Requirements that are
applicable to private construction projects.
HAZARDOUS MATERIALS
Section 40.1. Lessee covenants that Lessee shall use reasonable commercial efforts to
keep the Premises free of Hazardous Materials, except (i) for Hazardous Materials that may be
kept on the Premises in compliance with applicable Environmental Statutes, and (ii) any
Hazardous Materials introduced onto the Premises by an Indemnitee. Lessee shall not, and Lessee
shall contractually require that no Occupant entering into an Occupancy Agreement after the
Commencement Date shall, use, transport, store, dispose of or in any manner deal with Hazardous
Materials at the Premises, except in compliance with applicable Environmental Statutes, and
Lessee shall not, and Lessee shall contractually require that no Occupant entering into an
Occupancy Agreement after the Commencement Date shall, under any circumstances permit the
release or discharge of any Hazardous Materials into the waters of the Hudson River. Lessee shall
comply with, and Lessee shall contractually require that each Occupant entering into an
Occupancy Agreement after the Commencement Date shall comply, at all times during the Term,
with all applicable Environmental Statutes (it being acknowledged that it shall not constitute a
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breach of this Lease if minor violations (as the term “minor” is defined in Section 21.2) of
Environmental Statutes occur so long as the effect of such minor violations, individually and
cumulatively, is not material and does not lead to material enforcement actions by applicable
Governmental Authorities, and so long as Lessee uses reasonable commercial efforts to respond
to and remedy the underlying cause of any such minor violations within a reasonable time frame).
Lessee shall keep the Premises free and clear of any liens imposed pursuant to Environmental
Statutes that arise as a result of Lessee’s breach of this Section 40.1. In the event that Lessee
receives any notice or determination from any Governmental Authority or any source whatsoever
with respect to Hazardous Materials, at, under, on, from, adjacent to or affecting the Premises, or
affecting the waters of the Hudson River adjacent to the Premises, Lessee shall promptly notify
Lessor. Lessee shall conduct and complete, at its sole cost and expense, all investigations, studies,
sampling and testing, and take all remedial actions required by applicable Environmental Statutes
necessary to clean up and remove all Hazardous Materials from the Premises, including any
portions of the Hudson River into which Hazardous Materials were discharged or released by
Lessee or any Occupant or customer of the Premises, or in connection with any activities at the
Premises of Persons other than Indemnitees, provided that Lessee shall have no liability or
obligation to perform any clean up, removal or remediation of or in connection with any Hazardous
Materials introduced on the Premises by an Indemnitee or Hazardous Materials that existed prior
to the commencement of the Original Lease (including Hazardous Materials of which New York
State agreed to be deemed the owner pursuant to the Original Lease should it be determined that
such Hazardous Materials exist).
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IN WITNESS WHEREOF, Lessor and Lessee have executed this Lease as of the day and
year first above written.
LESSOR
HUDSON RIVER PARK TRUST
By: ____________________________
Name:
Title:
LESSEE
CHELSEA PIERS L.P.
By: Chelsea Piers Management Inc.,
General Partner
By: _______________________________
Name:
Title:
NORTH RIVER OPERATING COMPANY, L.P.
By: Chelsea Piers Management Inc.,
General Partner
By: ___________________________
Name:
Title:
As To The Provisions of Article 15.1(1)
By: Chelsea Piers Management Inc.,
General Partner
By: ___________________________
Name:
Title:
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APPENDIX A-1
BASELINE PUBLIC ACCESS IMPROVEMENT PLAN
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APPENDIX A-2
ENHANCED PUBLIC ACCESS IMPROVEMENT PLAN
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APPENDIX B
ILLUSTRATIVE EXAMPLE OF PERCENTAGE RENT CALCULATION
See Attached Spread Sheet and Assumptions
[TO BE INSERTED]
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EXHIBIT A-1
LEASEHOLD PARCEL
A certain tract of land including land under water, situate, lying and being in the Borough
of Manhattan, County, City and State of New York, being more particularly described as follows:
COMMENCING at a point, said point being a standard Manhattan Borough Monument
located at the northeast corner of 10th Avenue and West 17th Street, as established by the
Topographical Department of Manhattan Borough President’s Office.
Running thence westerly along the monument line of West 17th Street as established by
the Topographical Department of Manhattan Borough President’s Office, North 89 degrees 59
minutes 40 seconds West, a distance of 473.57 feet to a point;
Running thence westerly and at right angles to the monument line of 11th Avenue as
established by the Topographical Department of Manhattan Borough President’s Office, South 68
degrees 52 minutes 08 seconds West, a distance of 127.40 feet to a point;
Running thence southerly, South 15 degrees 58 minutes 58 seconds East a distance of 1.65
feet to the POINT OF BEGINNING, said point being on the center line of the southerly granite
curb of the access road to Chelsea Piers situated west of Marginal Street Wharf or Place, and said
point being the southeast corner of the lease limits herein described;
Running thence along said centerline of the southerly granite curb of the access road to
Chelsea Piers the following five (5) courses:
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ARTICLE 41 Along a curve bearing to the left and having a radius of 53.73 feet, an arc
distance of 4.43 feet (Chord bearing North 79 degrees 54 minutes 32 seconds West, Chord distance
4.42 feet) to a point;
ARTICLE 42 Along a curve bearing to the right and having a radius of 40.96 feet, an arc
distance of 10.63 feet (Chord bearing North 68 degrees 46 minutes 12 seconds West, Chord
distance 10.60 feet) to a point;
ARTICLE 43 North 58 degrees 17 minutes 44 seconds West, a distance of 10.97 feet to a
point;
ARTICLE 44 Along a curve bearing to the right and having a radius of 22.95 feet, an arc
distance of 16.35 feet (Chord bearing North 45 degrees 56 minutes 50 seconds West, Chord
distance 16.00 feet) to a point;
ARTICLE 45 North 22 degrees 20 minutes 09 seconds West, a distance of 10.09 feet to a
point;
Running thence westerly along a 3-feet wide metal rail, South 87 degrees 20 minutes 36
seconds West a distance of 11.09 feet to a point;
Running thence northerly, North 21 degrees 10 minutes 16 seconds West a distance of
21.94 feet to a point on the south facade of the Pier 59 Headhouse;
Running thence westerly, partially along the south facade of the Pier 59 Headhouse, and
through lands under water, South 68 degrees 51 minutes 56 seconds West a distance of 878.89 feet
to a point situate 7.49 feet distant east of the U.S. Pierhead Line (Hudson River) approved by the
Secretary of War in 1890 and last modified Jan 15, 1914;
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Running thence northerly through lands under water and parallel to the said U.S. Pierhead
Line, North 21 degrees 06 minutes 17 seconds West a distance of 1246.50 feet to a point;
Running thence easterly through lands under water along the south side of Pier 62, North
68 degrees 36 minutes 18 seconds East a distance of 637.44 feet to a point;
Running thence northerly through tax Lot City-62, North 21 degrees 31 minutes 28 seconds
West a distance of 78.37 feet to a point;
Running thence easterly through tax Lot City-62, North 68 degrees 39 minutes 15 seconds
East a distance of 158.03 feet to a point;
Running thence easterly through tax Lot City-62, South 62 degrees 11 minutes 57 seconds
East a distance of 27.58 feet to a point;
Running thence easterly through tax Lot City-62, South 89 degrees 40 minutes 53 seconds
East a distance of 103.81 feet to a point on the center line of the easterly granite curb of the access
road to Chelsea Piers situated west of Marginal Street Wharf or Place;
Running thence along said centerline of the easterly granite curb of the access road to
Chelsea Piers the following three (3) courses:
1. Along a curve bearing to the right and having a radius of 511.74 feet, an arc distance
of 57.18 feet (Chord bearing South 28 degrees 58 minutes 06 seconds East, Chord distance 57.15
feet) to a point;
2. Along a curve bearing to the right and having a radius of 922.21 feet, an arc distance
of 57.34 feet (Chord bearing South 24 degrees 10 minutes 57 seconds East, Chord distance 57.33
feet) to a point;
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3. South 21 degrees 08 minutes 36 seconds East, a distance of 1149.11 feet to a point;
Running thence South 15 degrees 58 minutes 58 seconds East, a distance of 75.15 feet to
the point of BEGINNING.
The water and marina area is described in Exhibit A-4.
For the sake of clarity, a copy of the 2020 Survey depicting the Premises (Land and
Improvements) is attached to this Exhibit A-1 as Schedule 1.
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SCHEDULE 1 TO EXHIBIT A-1
2020 SURVEY
(Premises: Land and Improvements)
[TO BE ATTACHED]
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EXHIBIT A-2
RIGHT OF WAY AREAS
ACCESS EASEMENT PARCEL (KNOWN FOR INFORMATIONAL PURPOSES
ONLY AS PIER 62 ACCESS EASEMENT)
COMMENCING at a point, said point being a standard Manhattan Borough Monument
located at the northeast corner of 10th Avenue and West 17th Street, as established by the
Topographical Department of Manhattan Borough President’s Office.
Running thence westerly along the monument line of West 17th Street as established by
the Topographical Department of Manhattan Borough President’s Office, North 89 degrees 59
minutes 40 seconds West, a distance of 473.57 feet to a point;
Running thence westerly and at right angles to the monument line of 11th Avenue as
established by the Topographical Department of Manhattan Borough President’s Office, South 68
degrees 52 minutes 08 seconds West, a distance of 127.40 feet to a point on the center line of the
easterly granite curb of the access road to Chelsea Piers situated west of Marginal Street Wharf or
Place;
Running thence along said centerline of the easterly granite curb of the access road to
Chelsea Piers the following four (4) courses:
1. North 15 degrees 58 minutes 58 seconds West, a distance of 73.50 feet to a point;
2. North 21 degrees 08 minutes 36 seconds West, a distance of 1149.11 feet to a point
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3. Along a curve bearing to the left and having a radius of 922.21 feet, an arc distance
of 57.34 feet (Chord bearing North 24 degrees 10 minutes 57 seconds West, Chord distance 57.33
feet) to a point;
4. Along a curve bearing to the left and having a radius of 511.74 feet, an arc distance
of 57.18 feet (Chord bearing North 28 degrees 58 minutes 06 seconds West, Chord distance 57.15
feet) to the POINT OF BEGINNING.
Running thence along the division line between the said leasehold estate and Pier 62, and
partially through Tax Lot 62 and Marginal Street, Wharf or Place, the following five (5) courses:
1. North 89 degrees 40 minutes 53 seconds West, a distance of 103.81 feet to a point;
2. North 62 degrees 11 minutes 57 seconds West, a distance of 27.58 feet to a point;
3. South 68 degrees 39 minutes 15 seconds West, a distance of 158.03 feet to a point;
4. South 21 degrees 31 minutes 28 seconds East, a distance of 78.37 feet to a point;
5. South 68 degrees 36 minutes 18 seconds West, a distance of 637.44 feet to a point
situate 7.11 feet distant east of the U.S. Pierhead Line (Hudson River) approved by the Secretary
of War in 1890 and last modified Jan 15, 1914;
Running thence northwesterly through lands under water and parallel to the said U.S.
Pierhead Line, North 21 degrees 06 minutes 17 seconds West, a distance of 193.14 feet to a point
in Tax Lot 10;
Running thence through Tax Lot 10, the following two (2) courses:
1. North 68 degrees 53 minutes 43 seconds East, a distance of 293.07 feet;
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2. South 21 degrees 06 minutes 20 seconds East, a distance of 45.00 feet to a point in
Tax Lot 62;
Running thence through Tax Lot 62 and Marginal Street, Wharf or Place, the following
five (5) courses:
1. North 68 degrees 53 minutes 43 seconds East, a distance of 124.88 feet;
2. North 68 degrees 41 minutes 55 seconds East, a distance of 301.31 feet;
3. South 87 degrees 58 minutes 40 seconds East, a distance of 183.85 feet;
4. Along a curve bearing to the right and having a radius of 109.99 feet, an arc distance
of 46.79 feet (Chord bearing South 24 degrees 22 minutes 30 seconds East, Chord distance 46.44
feet) to a point.
5. Along a curve bearing to the right and having a radius of 511.74 feet, an arc distance
of 11.30 feet (Chord bearing South 32 degrees 48 minutes 07 seconds East, Chord distance 11.30
feet) to the point of BEGINNING.
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EXHIBIT A-3
ROUTE 9A ACCESS PARCELS
Two (2) Access Parcels designated Route 9A Access Parcel I and Route 9A Access
Parcel II, more particularly described as follows:
ROUTE 9A ACCESS PARCEL I
COMMENCING at a point, said point being a standard Manhattan Borough Monument
located at the northeast corner of 10th Avenue and West 17th Street, as established by
the Topographical Department of Manhattan Borough President's Office.
Running thence westerly along the monument line of West 17th Street as established by
the Topographical Department of Manhattan Borough President's Office, North 89
degrees 59 minutes 40 seconds West, a distance of 473.57 feet to a point;
Running thence westerly and at right angles to the monument line of 11th Avenue as
established by the Topographical Department of Manhattan Bor-0ugh President's Office,
South 68 degrees 52 minutes 08 seconds West, a distance of 127.40 feet to a point;
Running thence southerly, South 15 degrees 58 minutes 58 seconds West, a distance of
1.65 feet to the POINT OF BEGINNING, said point being on the center line of the
southerly granite curb of the access road to Chelsea Piers situated west of Marginal
Street Wharf or Place, and said point being the southwest corner of the lease limits
herein described;
Running thence northerly, North 15 degrees 58 minutes 58 seconds West, a distance of
75.15 feet to a point;
Running thence along the centerline of the northerly granite curb of the access road to
Chelsea Piers the following three (3) courses:
1.
Along a curve bearing to the left and having a radius of 31.59 feet, an arc
distance of 14.64 feet (Chord bearing South 38 degrees 34 minutes 13 seconds East,
Chord distance 14.50 feet) to a point;
2.
South 53 degrees 40 minutes 07 seconds East, a distance of 11.52 feet to a
point;
3.
Along a curve bearing to the left and having a radius of 6.06 feet, an arc
distance of 15.06 feet (Chord bearing North 46 degrees 36 minutes 33 seconds East,
Chord distance 11.47 feet) to a point;
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Running thence southerly, South 21 degrees 21 minutes 11 seconds East, a distance of
109.05
feet to a point on the center line of the southerly granite curb of the access road
to Chelsea Piers situated west of Marginal Street Wharf or Place;
Running thence westerly along the center line of the southerly granite curb of the access
road to Chelsea Piers the following two (2) courses:
1.
Along a curve bearing to the left and having a radius of 62.41 feet, an arc
distance of 54.42 feet (Chord bearing North 45 degrees 16 minutes 51 seconds West, Chord
distance 52.71 feet) to a point;.
2.
Along a curve bearing to the left and having a radius of 53.73 feet, an arc
distance of 8.61feet (Chord bearing North 72 degrees 57 minutes 36 seconds West,
Chord distance 8.60 feet) to the point of BEGINNING.
Containing an area of 1594.09 square feet, or 0.0366 acre.
ROUTE 9A ACCESS PARCEL II
COMMENCING at a point, said point being a standard Manhattan Borough Monument
located at the northeast corner of 1oth Avenue and West 17th Street, as established by the
Topographical Department of Manhattan Borough President's Office.
Running thence westerly along the monument line of West 17th Street as established by
the Topographical Department of Manhattan Borough President's Office, North 89
degrees 59 minutes 40 seconds West, a distance of 473.57 feet to a point;
Running thence westerly and at right angles to the monument line of 11th Avenue as
established by the Topographical Department of Manhattan Borough President's Office,
South 68 degrees 52 minutes 08 seconds West, a distance of 127.40 feet to a point on the
center line of the easterly granite curb of the access road to Chelsea Piers situated
west of Marginal Street Wharf or Place;
\
Running thence along said centerline of the easterly granite curb of the access road to
Chelsea Piers the following four (4) courses:
. 1. North 15 degrees 58 minutes 58 seconds West, a distance of 73.50 feet to a
point;
2.
North 21 degrees 08 minutes 36 seconds West, a distance of 1149.11 feet to a
Point
3.
Along a curve bearing to the left and having a radius of 922.21 feet, an arc
9796273.22
distance of 57.34 feet (Chord bearing North 24 degrees 10 minutes 57 seconds West,
Chord distance 57.33 feet) to a point;
4.
Along a curve bearing to the left and having a radius of 511.74 feet, an arc
distance of 57.18 feet (Chord bearing North 28 degrees 58 minutes 06 seconds West,
Chord distance 57.15 feet) to the point of BEGINNING.
Running thence westerly through tax Lot City-62, North 89 degrees 40 minutes 53
seconds West a distance of 94.27 feet to a point;
Running thence northeasterly through tax Lot City-62, North 09 degrees 33 minutes 17
seconds East a distance of 26.44 feet to a point on the centerline of the easterly curb of the
access road to Chelsea Piers from NYS Route 9A (southbound);
Running thence northerly along a metal fence and through tax Lot City-2 the following
thirteen (13) courses:
1. Along a curve bearing to the right and having a radius of 14.12 feet, an arc
distance of 6.84 feet (Chord bearing North 42 degrees 25 minutes 19 seconds West,
Chord distance 6.78 feet) to a point;
2.
North 59 degrees 45 minutes 57 seconds West a distance of 19.26 feet to a
point;
3. Along a curve bearing to the right and having a radius of 48.09 feet, an arc
distance of 25.07 feet (Chord bearing North 49 degrees 18 minutes 08 seconds West,
Chord distance 24.78 feet) to a point;
4.
Along a curve bearing to the left and having a radius of 110.17 feet, an arc
distance of 34.37 feet (Chord bearing North 46 degrees 45 minutes 18 seconds West,
Chord distance 34.23 feet) to a point;
5. Along a curve bearing to the right and having a radius of 103.46 feet, an arc
distance of 35.21 feet (Chord bearing North 49 degrees 00 minutes 46 seconds West,
Chord distance 35.04 feet) to a point;
6.
North 52 degrees 08 minutes 08 seconds West a distance of 79.94 feet to a
point;
7. Along a curve bearing to the right and having a radius of 29.14 feet, an arc
distance of 22.81 feet (Chord bearing North 29 degrees 42 minutes 28 seconds West,
Chord distance 22.24 feet) to a point;
·
8.
North 06 degrees 36 minutes 05 seconds West a distance of 7.51 feet to a point;
9. Along a curve bearing to the left and having a radius of 9.93 feet, an arc distance
of 5.58 feet (Chord bearing North 29 degrees 20 minutes 40 seconds West, Chord
9796273.22
distance 5.50 feet) to a point;
10. North 23 degrees 38 minutes 31 seconds West a distance of 21.96 feet to a point;
11.
North 08 degrees 48 minutes 03 seconds West a distance of 44.23 feet to a point;
12.
North 34 degrees 56 minutes 23 seconds West a distance of 22.15 feet to a point;
13. South 86 degrees 58 minutes 00 seconds West a distance of 19.27 feet to a point on
the centerline of the easterly curb of the access road to Chelsea Piers from NYS Route 9A
(southbound);
Running thence northerly along said centerline of the easterly curb of the access road to
Chelsea Piers and through tax Lot City-2, North 25 degrees 11 minutes 38 seconds West a
distance of 22.36 feet to a point;
Running thence easterly, North 87 degrees 34 minutes 23 seconds East a distance of
27.03
feet to a point on the westerly curb of the public bus access road to Chelsea Piers
from NYS Route 9A (southbound);
Running thence southerly along the westerly curb of the public bus access road to Chelsea
Piers and through tax Lot City-2 the following sixteen (16) courses:
1.
South 47 degrees 49 minutes 35 seconds East a distance of 12.57 feet to a
point;
2.
Along a curve bearing to the right and having a radius of 121.64 feet, an arc
distance of 31.60 feet (Chord bearing South 38 degrees 24 minutes 09 seconds East, Chord
distance 31.51 feet) to a point;
3.
South 40 degrees 50 minutes 58 seconds East a distance of 60.78 feet to a
point;
4.
Along a curve bearing to the left and having a radius of 674.26 feet, an arc
distance of 77.10 feet (Chord bearing South 51 degrees 51 minutes 53 seconds East,
Chord distance 77.06 feet) to a point;
,
5.
Along a curve bearing to the right and having a radius of 169.89 feet, an arc
distance of 50.28 feet (Chord bearing South 51 degrees 01 minutes 58 seconds East, Chord
distance 50.09 feet) to a point;
6.
Along a curve bearing to the left and having a radius of 193.58 feet, an arc
distance of 26.42 feet (Chord bearing South 44 degrees 32 minutes 35 seconds East,
Chord distance 26.40 feet) to a point;
9796273.22
7.
Along a curve bearing to the right and having a radius of 174.21 feet, an arc
distance of 49.05 feet (Chord bearing South 44 degrees 10 minutes 05 seconds East,
Chord distance 48.89 feet) to a point;
8.
Along a curve bearing to the left and having a radius of 28.63 feet, an arc
distance of 26.54 feet (Chord bearing South 66 degrees 26 minutes 28 seconds East, Chord
distance 25.60 feet) to a point;
·
9.
North 87 degrees 28 minutes 30 seconds East a distance of 17.87 feet to a
point;
10.
Along a curve bearing to the right and having a radius of 10.18 feet, an arc
distance of 11.40 feet (Chord bearing South 71 degrees 10 minutes 58 seconds East, Chord
distance 10.81 feet) to a point;
11.
South 35 degrees 28 minutes 40 seconds East a distance of.23.85 feet to a point;
12.
Along a curve bearing to the left and having a radius of 13.62 feet, an arc distance of
4.87 feet (Chord bearing South 90 degrees 00 minutes 00 seconds West, Chord
distance 4.84 feet) to a point;
13.
South 76 degrees 50 minutes 42 seconds West a distance of 19.43 feet to a point;
14. Along a curve bearing to the left and having a radius of 3.31 feet, an arc distance of
5.96 feet (Chord bearing South 03 degrees 37 minutes 22 seconds West, Chord distance
5.19 feet) to a point;
15. Along a
curve
bearing· to
the
right
and
having a
radius
of
233.28 feet,
an
arc
distance of 10.93 feet (Chord bearing South 48 degrees 40 minutes 20 seconds East,
Chord
distance 10.93 feet) to a point;
16 Along a curve bearing to the right and having a radius of 153.22 feet, an arc distance of
31.74 feet (Chord bearing South 36 degrees 06 minutes 31 seconds East, Chord distance 31.69
feet) to the point of BEGINNING.
Containing an area of 20,056.37 square feet, or 0.4604 acre.
9796273.22
EXHIBIT A-4
WATER AND MARINA AREA
ALL THAT CERTAIN PLOT PIECE OR PARCEL OF LAND, SITUATE, LYING AND BEING
IN THE BOROUGH OF MANHATTAN, CITY, COUNTY AND STATE OF NEW YORK, BOUNDED AND
DESCRIBED AS FOLLOWS:
COMMENCING AT A POINT, SAID POINT BEING A STANDARD MANHATTAN BOROUGH
MONUMENT LOCATED AT THE NORTHEAST CORNER OF 10TH AVENUE AND WEST 17TH STREET,
AS ESTABLISHED BY THE TOPOGRAPHICAL DEPARTMENT OF MANHATTAN BOROUGH PRESIDENT'S
OFFICE.
RUNNING THENCE WESTERLY ALONG THE MONUMENT LINE OF WEST 17TH STREET AS
ESTABLISHED BY THE TOPOGRAPHICAL DEPARTMENT OF MANHATTAN BOROUGH PRESIDENT'S
OFFICE, NORTH 89 DEGREES 59 MINUTES 40 SECONDS WEST, A DISTANCE OF 473.57 FEET
TO A POINT;
RUNNING THENCE WESTERLY AND AT RIGHT ANGLES TO THE MONUMENT LINE OF 11TH
AVENUE AS ESTABLISHED BY THE TOPOGRAPHICAL DEPARTMENT OF MANHATTAN BOROUGH
PRESIDENT'S OFFICE, SOUTH 68 DEGREES 52 MINUTES 08 SECONDS WEST, A DISTANCE OF
127.40 FEET TO A POINT;
RUNNING THENCE IN A SOUTHERLY DIRECTION SOUTH 41 DEGREES 47 MINUTES 13
SECONDS WEST, A DISTANCE OF 40.19 FEET TO THE POINT AND PLACE OF BEGINNING;
RUNNING THENCE WESTERLY THROUGH LANDS UNDER WATER, SOUTH 68 DEGREES 51
MINUTES 56 SECONDS WEST A DISTANCE OF 878.99 FEET TO A POINT SITUATE 7.49 FEET
DISTANT EAST OF THE U.S. PIERHEAD LINE (HUDSON RIVER) APPROVED BY THE SECRETARY
OF WAR IN 1890 AND LAST MODIFIED JAN 15, 1914
9796273.22
RUNNING THENCE NORTHERLY THROUGH LANDS UNDER WATER AND PARALLEL TO THE
SAID U.S. PIERHEAD LINE, NORTH 21 DEGREES 06 MINUTES 17 SECONDS WEST A DISTANCE
OF 84.89 FEET TO A POINT;
RUNNING THENCE EASTERLY, PARTIALLY ALONG THE SOUTH FACADE OF THE PIER 59
HEADHOUSE, AND THROUGH LANDS UNDER WATER, SOUTH 68 DEGREES 51 MINUTES 56 SECONDS
WEST A DISTANCE OF 878.89 FEET TO A POINT ON THE SOUTH FACADE OF THE PIER 59
HEADHOUSE;
RUNNING THENCE SOUTHERLY, SOUTH 21 DEGREES 10 MINUTES 16 SECONDS EAST,
84.89 FEET TO THE POINT AND PLACE OF BEGINNING.
CONTAINING 7,412 SQUARE FEET OR 0.170 ACRES
1
EXHIBIT B
TITLE MATTERS
(Capitalized terms used herein shall have the same meaning set forth in the body of the
Lease, unless otherwise indicated.)
1. Lease dated as of April 3, 1999 by and between the State of New York, by and through its
Office of Parks, Recreation and Historic Preservation and its Department of Environmental
Conservation, as lessor, and Hudson River Park Trust, as lessee, as amended on February
9, 2016, January 22, 2020, and June 2, 2021.
2. State of facts shown on survey made by Control Point Associates Inc. with file number 07-
170171 (i) dated September 8, 2017, and last redated as of August 6, 2020, with respect to
Lots 11, 16, 19 and 62, and (ii) dated as of August 24, 2020. with respect to Lot 7, and any
changes since such date resulting from the acts of the lessee under the Existing Lease or
any Existing Tenants.
3. Pier 62 Access Easement, as shown on the 2020 Survey.
4. Route 9A Access Parcels, as shown on the 2020 Survey.
5. Maintenance and Operating Agreement made among Chelsea Piers, L.P., The City of New
York, acting by and through the Department of Parks & Recreation of the City of New
York and the Director of the Department of City Planning, dated as of August 11, 1995
and recorded August 24, 1995 in Reel 2236 Page 289 of the Office of the City Register in
New York County.
6. Consolidated, Amended and Restated Leasehold Mortgage, Security Agreement and
Fixture Filing and UCC financing Statement, all dated as of August 31, 2020 between
Chelsea Piers L.P., North River Operating Company L.P., Silver Screen LLC, Waterfront
2
Services I LLC, North River Property LLC and Pier 62 Restaurant LLC, collectively as
mortgagor, and Vici Lendco LLC, as mortgagee, which Consolidated, Amended and
Restated Leasehold Mortgage was recorded on September 1, 2020 as CRFN
2020000245144.
7. Assignment of Leases and Rents dated as of August 21, 2020 between Chelsea Piers L.P.,
North River Operating Company L.P., Silver Screen LLC, Waterfront Services I LLC,
North River Property LLC and Pier 62 Restaurant LLC, collectively as assignor, and Vici
Lendco LLC, as assignee, and recorded on September 1, 2020 as CRFN 2020000245145.
8. Terms, covenants and conditions contained in the unrecorded Right of First Refusal
Agreement made between Chelsea Piers L.P. and Vici Properties L.P, dated as of August
27, 2020 and evidenced by Memorandum of Agreement dated as August 31, 2020 and
recorded on September 1, 2020 as CRFN 2020000245146.
9. Subordination and Non-Disturbance Agreement dated as of _________, 2022 by and
among The State of New York, acting through its office of Parks, Recreation and Historic
Preservation and through its Department of Environmental Conservation and through its
Office of General Services (collectively, the “State”) and Chelsea Piers L.P. and North
River Operating Company L.P. (collectively, the “Lessee”).
10. Transfer Instrument and Notice of Restrictions made by Hudson River Park Trust,
transferor to DD West 29th LLC and West Side 11th and 29th LLC collectively as
Transferee dated as of May 31, 2019 and recorded June 6, 2019 in CRFN 2019000176519,
and, with regard thereto
a. Waiver pursuant to Section 89-21(d) of the Zoning Resolution of the City of New
York made by the State of New York, acting through the Office of Parks,
3
Recreation and Historic Preservation dated as of March 20, 2019 and recorded June
6, 2019 as CRFN 2019000176516, and
b. Waiver, Release and Quitclaim made by Chelsea Piers, L.P., dated as of December
19, 2018 and recorded June 6, 2019 as CRFN 2019 000176517.
11. Transfer Instrument and Notice of Restrictions made by Hudson River Park Trust, as
Transferor to West 30th Street LL, as transferee dated as of May 9, 2019 and recorded June
12, 2019 as CRFN 2019000184600, and, with regard thereto
a. Waiver pursuant to Section 89-21(d) of the Zoning Resolution of the City of New
York made by The State of New York acting through the Office of Parks,
Recreation and Historic Preservation dated as of December 5, 2018 and recorded
June 12, 2019 as CRFN2019000184598, and
b. Waiver, Release and Quitclaim made by Chelsea Piers L.P., dated as of December
19, 2018 and recorded June 12, 2019 as CRFN 2019000184598.
12. All Occupancy Agreements entered into by Chelsea Piers L.P. or any Person affiliated with
Chelsea Piers L.P., including all recorded and unrecorded Subleases and License
Agreements made by Chelsea Piers L.P., as landlord/sublessor/licensor for portions of the
Premises, and all recorded and unrecorded Amendments, Assignment and Assumption
Agreements, and Subordination, Nondisturbance and Attornment Agreements related to
such Subleases and License Agreements.
13. Determination that portions of the Premises are eligible for listing on the National and State
Registers of Historic Places.
14. Easements, rights, restrictions, covenants and matters of record as of the Execution Date.
4
15. Restricted use imposed by Section 35 of the General City Law for those portions of the
Premises that lie within the bed of Marginal Street, Wharf or Place as shown on the Final
Section Maps.
16. .Rights of the United States Government to establish harbor, bulkhead or pierhead lines or
to change or alter any such existing lines and to remove or compel the removal of fill and
improvements thereon including building or other structures, from land now or formerly
lying below the high water mark of the Hudson River without compensation to the insured.
17. Rights of the United States Government, the State of New York and the City of New York
or any of their departments or agencies to regulate and control the use of the piers,
bulkheads, land under water and land adjacent thereto.
18. Riparian rights and easements of others over the water of the Hudson River.
1
EXHIBIT C
INTENTIONALLY OMITTED
1
EXHIBIT D
EXISTING TENANTS
[TO BE INSERTED]
1
EXHIBIT E
INTENTIONALLY OMITTED
1
EXHIBIT F
INSURANCE PROVISIONS
a) Each year during the Term of this Lease, Lessee shall provide HRPT with (i)
Certificates of Insurance naming the Additional Insureds set forth below and, (ii) at the request of
HRPT, the “Schedules of Forms and Endorsements” and copies of the Forms and Endorsements
evidencing compliance with all coverage requirements contained in this Exhibit F. Such
certificates and Schedules of Forms and Endorsements shall be in form and substance acceptable
to HRPT. Acceptance and/or approval of such certificates and/or Schedules of Forms and
Endorsements and copies of the Forms and Endorsements by HRPT do not, and shall not, be
construed to relieve the Lessee of any obligations, responsibilities or liabilities under this Exhibit
F.
b) If any of the insurance required to be carried under this Lease shall not, after diligent
efforts by Lessee, be obtainable from domestic carriers customarily insuring premises similar to
the Premises and business operations of a size, nature and character similar to the size, nature and
character of the business operations being conducted by Lessee at the Premises, then Lessee shall
promptly notify HRPT of Lessee’s inability to obtain such insurance and HRPT shall have the
right, but not the obligation, to arrange for Lessee to obtain such insurance or to confirm Lessee’s
inability to obtain such insurance. If HRPT shall be able to arrange for Lessee to obtain such
insurance at commercially reasonable rates, Lessee shall obtain the same up to the maximum limits
provided for herein. If HRPT shall be unable to arrange for Lessee to obtain such insurance at
commercially reasonable rates and/or confirms the inability for Lessee to obtain such insurance,
Lessee shall obtain the maximum insurance obtainable at commercially reasonable rates and the
failure of Lessee to carry the insurance that is not obtainable shall not constitute an Event of
2
Default hereunder for as long as such insurance shall remain unobtainable. Types or amounts of
insurance shall be deemed unobtainable if such types or amounts of insurance are (i) actually
unobtainable or (ii) virtually unobtainable as a result of unreasonable or exorbitant premiums
which have made such insurance effectively unobtainable with respect to premises similar to the
Premises located in New York City and used for purposes similar to those for which the Premises
are used.
c) All insurance required by this Exhibit F shall include the following as “Additional
Insured” if such coverage is available under such insurance policies: Hudson River Park Trust, the
State of New York, the City of New York, and each of their respective offices, agencies and
departments. The HRPT offices are located at Pier 40 - 353 West Street, Suite 201, New York,
NY 10014 - Attn: Insurance Manager. The Additional Insured protection on the General Liability
policy shall be provided on form CG 20 10 11 85 or CG 20 26 or its equivalent as applicable, or
may be obtained through a combination of CG 20 10 07 04 and CG 20 37 07 04 or their equivalents.
Additional Insured coverage must apply to direct and vicarious liability for both on-going and
completed operations.
d) Lessee shall require that any contractors or subcontractors (together, “contractor”)
that perform work for the Lessee on the Premises in a contract amount of One Hundred Thousand
Dollars ($100,000) or more carry insurance with the same limits and provisions provided herein
unless otherwise approved by Lessee on a case-by-case basis in accordance with then prevailing
industry custom and applicable Requirements, except that (i) contractors and subcontractors that
perform work on the Premises at a contract amount between $100,000 and $4 million shall be
required to carry general liability insurance with a limit of no less than $1 million per occurrence
and contracts over $4 million shall have coverage that is no less than $4 million per occurrence
3
and (ii) contractors or subcontractors performing construction work that includes land excavation
building foundation formation, roofing, exterior wall construction, load bearing beam installation,
load bearing beam removal, structural steel installation, structural steel removal, elevator shaft
work, fire suppression systems, boiler systems, exterior wall demolition or exterior wall work shall
be required to carry general liability insurance with a limit of no less than $5 million per occurrence
and for all other construction work, contractors or subcontractors shall carry general liability
insurance with a limit of no less than $2 million per occurrence, in each case unless otherwise
approved by the Lessee on a case-by-case basis in accordance with then prevailing industry custom
and applicable Requirements; it is understood that the required insurance may be composed of
umbrella and/or excess liability policies in conjunction with primary general liability policy to
meet the required total limits of liability, provided that the umbrella or excess liability policies
shall cover in the same manner as the primary general liability policy and contain no additional
exclusions or limitations other than those of the primary policy). All contractor insurance policies
must include ISO Endorsement CG 20 38 or its equivalent to ensure additional insured protection
is afforded the HRPT without regard to privity of contract. Lessee will contractually require all
contractors to be responsible for all injuries to persons, including death, or damage to property
sustained while performing or resulting from the work under this Lease, if and to the extent the
same results from any act, omission, negligence, fault or default of contractor, or their employees,
agents, servants, independent contractors or subcontractors retained by contractor (collectively,
“Contractor Parties”) pursuant to any contract or agreement entered into in relation to this Lease.
Lessee will contractually require contractors to defend, indemnify and hold Lessor and all parties
required to be named as an Additional Insured under this Lease (collectively, the “Indemnitees”)
harmless from any and all claims, judgments and liabilities, including but not limited to claims,
4
judgments and liabilities for injuries to persons (including death) and damage to property if and to
the extent the same results from any act, omission, negligence, fault or default of contractor or
Contractor Parties and from any claims against, or liability incurred by the Indemnitees by reason
of claims against Contractor or Contractor Parties for any matter whatsoever in connection with
the services performed under this Lease, including, but not limited to, claims for compensation,
injury or death, and agree to reimburse the Indemnitees for reasonable attorney’s fees incurred in
connection with the above. Lessee will contractually require contractors to be solely responsible
for the safety and protection of all its Contractor Parties, and to assume all liability for injuries,
including death, that may occur to said persons due to the negligence, fault or default of the
applicable contractor and Contractor Parties. Lessee shall take all steps reasonably necessary to
enforce the contractual obligations of contractors and Contractor Parties.
e) Each insurance carrier must be rated at least “A-” Class “VII” in the most recently
published A.M. Best’s Insurance Report. If, during the term of the policy, a carrier’s rating falls
below “A-” Class “VII”, the insurance policy must be replaced no later than the renewal date of
the policy with an insurer acceptable to the HRPT and rated at least “A-” Class “VII” in the most
recently published A.M. Best’s Insurance Report.
f) Lessee shall cause all insurance that is required to be in full force and effect as of
the Commencement Date of this Lease and to remain in full force and effect throughout the Term
of the Lease and as further required by this Exhibit F. Lessee shall not take any action, or omit to
take any action, that would suspend or invalidate any of the required coverages during the period
of time such coverages are required to be in effect. Coverage shall:
1. Be primary and non-contributing to any insurance or self-insurance maintained by
the HRPT.
5
2. Be obtained at the sole cost and expense of Lessee or its respective contractor(s),
and shall be maintained with insurance carriers authorized to do business in New York.
3. Provide written notice to the HRPT, at least thirty (30) days prior to the termination,
cancellation or non-renewal of such insurance policies or ten (10) days in the case of non-payment
of premium; notice shall be sent, via express or certified mail to:
Hudson River Park Trust
Attn: Insurance Manager
353 West Street
Pier 40, Second Floor
New York, NY 10014
4. Be solely responsible for the payment of their respective deductibles and self-
insured retentions to which such insurance policies are subject. Self-Insured Retentions may not
exceed an amount per claim equal to One Million Dollars ($1,000,000) per claim unless otherwise
approved by the HRPT. General liability and umbrella/excess policies shall contain no deductibles
in excess of Five Hundred Thousand Dollars ($500,000) per claim unless otherwise approved by
HRPT. Except to the extent otherwise required by the terms of loan documents entered into by
Lessee and a Mortgagee, the loss under all policies required by any provision of this Lease insuring
against damage to the Improvement by fire or other casualty shall be payable to Depository,
provided that amounts of less than One Million Dollars ($1,000,000) shall be payable directly to
Lessee for application to the cost of Restoration in accordance with Article 6 of the Lease.
g) Under no circumstances shall any insurance policies exclude coverage for claims
that result from the imposition of New York Labor Law or for any Public Open Space or any
portions of the premises used or for Public Access and Public Benefit Uses.
h) Upon the renewal date of any insurance policies, Lessee shall supply the HRPT
with updated replacement proofs of coverage on Certificates of Insurance.
6
i) Lessee shall cause to be included in each of its insurance policies a waiver of the
insurer’s right of subrogation against HRPT and/or any Additional Insureds.
j) Lessee, throughout the Term of the Lease, or as otherwise required by this Exhibit
F, shall obtain and maintain in full force and effect, the following insurance with limits not less
than those described below and as required by the terms of this Exhibit F, or as required by law,
whichever is greater (limits may be provided through a combination of primary and
umbrella/excess policies) and such policies as applicable shall cover the Premises and all streets,
alleys and sidewalks adjoining or appurtenant to the Premises:
1. Commercial General Liability Insurance with a limit of not less than Eleven
Million Dollars ($11,000,000) per occurrence as of the Commencement Date, which shall be
increased to Fifteen Million Dollars ($15,000,000) on the first date that the policy is scheduled for
renewal after January 1, 2027 and to Twenty Million Dollars ($20,000,000) on the first date that
the policy is scheduled for renewal after January 1, 2035 and Twenty Five Million Dollars
($25,000,000) on the first date that the policy is scheduled for renewal after January 1, 2041. Such
insurance shall be written on ISO Form CG 00 01 12 07 or substitute form providing equivalent
coverage and shall cover liability arising from Premises operations, independent contractors,
products-completed operations, personal and advertising injury, cross liability coverage, blanket
contractual liability (including tort liability of another assumed in a contract), extended bodily
injury coverage, and damage to rented premises. Such insurance may not include an Athletic
Participant exclusion or an underwater activities exclusion. If the Lessee’s work includes
construction activities of any kind, then the Lessee and/or its contractor must include a completed
Acord 855 NY form when providing evidence of insurance.
7
2. Comprehensive Business Automobile Liability Insurance with a limit of not less
than One Million Dollars ($1,000,000) Combined Single Limit. Such insurance shall cover owned,
leased, hired and non-owned automobiles; shall cover bodily injury, property damage and medical
payments; and include uninsured and underinsured motorists’ coverage.
3. Workers Compensation, Employers Liability and Disability Benefits
Insurance and US Long Shore & Harbor Workers at statutory limits as applicable to the
Lessee’s operations and required by law. Proof of Workers Compensation coverage must be
presented on the NYS WCB C-105.2 or equivalent form; proof of Disability coverage must be
provided on a DB-120.1 form.
a) The NY State Workers Compensation Board guideline regarding these
requirements is available at:
http://www.wcb.ny.gov/content/main/forms/AllForms.jsp
b) If Exempt from Worker Compensation please refer to the following link and
provide proof on the CE200 form issues by the NY State Workers Compensation Board:
http://www.wcb.ny.gov/content/ebiz/wc_db_exemptions/requestExemptionOverv
iew.jsp
c) If Lessee is not a NY State based business, then Lessee must provide a copy of its
Workers’ Compensation policy’s Declarations Page to show that New York is listed in Part 3A
and to confirm the policy provides statutory Employer’s Liability coverage applicable in NYS.
4. Liquor Liability Insurance with a limit of not less than Two Million Dollars
($2,000,000) per common cause is required if Lessee is in the business of manufacturing,
8
distributing, selling, serving, or furnishing alcoholic beverages. This coverage must be carried by
any contractor or subtenant of Lessee that is in the business of manufacturing, distributing, selling,
serving, or furnishing alcoholic beverages.
5. Protection and Indemnity Insurance including Jones Act coverage with a limit
of not less than Twenty Million Dollars ($20,000,000). Such insurance shall not be required of
Lessee but shall be required of any subtenant of Lessee if such insurance is applicable to the
business of such subtenant, and then only to the extent it is customary and reasonable for such
subtenant to obtain and maintain such insurance. Where applicable, such insurance shall provide
coverage at a minimum for loss of life, personal injury and illness of crew, passengers and third-
party individuals, damage to cargo on board, damage to piers, docks, buoys and other fixed or
floating objects and damage to other vessels and their cargo; Hull and Machinery coverage with a
limit of not less than full replacement value of the vessel covering all loss or damage to the vessel
from any covered cause of loss in connection with permitted activity.
6. Commercial Property Insurance on the Improvements protecting the Lessee and
HRPT against loss of, or damage to, the Improvements by fire and other risks of physical loss, or
damage now or hereafter embraced by ISO “Special Form” or its equivalent, which shall be in the
amount of the full replacement costs of the Improvements (without depreciation or obsolescence
clause). The Parties agree that a $100 Million policy must be maintained for the first five years
after the Commencement Date, which shall then be increased by the CPI Adjuster every five years
during the Term commencing at the next renewal period for property insurance coverage
(hereafter, the “Minimum Property Insurance”). The Minimum Property Insurance shall not need
to be otherwise increased unless required by the Mortgagee or other Institutional Lender or a
Governmental Authority (for this paragraph 6, Lessor shall not be construed as a Governmental
9
Authority). Within one year after Lessee completes a Capital Improvement, Lessee shall review
with its insurer if the Minimum Property Insurance needs to be increased and thereafter Lessee
shall procure sufficient commercial property insurance no later than the next renewal term but in
no event shall the policy procured be less than the Minimum Property Insurance carried by Lessee
before completion of the Capital Improvement (which Minimum Property Insurance will be the
greater of $100 Million as adjusted by the CPI Adjuster or the value required by the Mortgagee or
other Institutional Lender or a Governmental Authority as adjusted by the CPI Adjuster). Such
insurance shall designate HRPT as a loss payee and Lessee as named insured.
7. Flood Insurance in an amount of at least $10 Million to the extent commercially
available at reasonable premium rates, covering at minimum, water damage due to flood, rising
water, and inundation due to flood conditions; coverage to the maximum extent available under
the National Flood Insurance Act of 1968.
8. During the performance of any construction work, restoration or alteration, “All
Risk” Builder’s Risk Insurance written on a completed value (non-reporting) basis in an amount
sufficient to prevent Lessee and HRPT from becoming coinsurers under provisions of applicable
policies of insurance covering the perils insured under the ISO special causes of loss form extended
coverage, including fire, vandalism, malicious mischief, collapse, water damage, and transit and
theft of building materials, with deductible reasonably approved by HRPT, as well as during transit
and at any off-site storage location intended for use with respect to the Premises, naming HRPT
and Lessee as their respective interests may appear. The policy shall cover the cost of removing
debris, including demolition as may be legally necessary by the operation of any law, ordinance
or regulation.
10
9. If any work involves abatement, removal, repair, replacement, enclosure,
encapsulation and/or disposal of any hazardous material or substance, Lessee or its contractor shall
procure and maintain Contractor’s Pollution Liability Insurance with limits of not less than Three
Million Dollars ($3,000,000), providing coverage for bodily injury and property damage, including
loss of use of damaged property or of property that has not been physically damaged. Such policy
shall provide coverage for actual, alleged or threatened emission, discharge, dispersal, seepage,
release or escape of pollutants, including any loss, cost or expense incurred as a result of any
cleanup of pollutants or in the investigation, settlement or defense of any claim, suit, or
proceedings against HRPT arising from Lessee’s work.
a) If coverage is written on a claims-made policy, Lessee warrants that any applicable
retroactive date precedes the effective date of the contract for such work; and that continuous
coverage will be maintained, or an extended discovery period exercised, for a period of not less
than two (2) years from the time work under the applicable contract is completed.
b) If the contract for work includes disposal of materials from the job site, the Lessee
and/or contractor must furnish HRPT with evidence of Pollution Legal Liability insurance, in an
amount satisfactory to HRPT, that is maintained by the disposal site operator for losses arising
from the disposal site accepting waste under the contract.
10. If Lessee is contracting for professional services, Lessee shall require that its
consultant(s) maintain Errors and Omissions Liability Insurance with coverage of not less than
One Million Dollars ($1,000,000) per claim and as an aggregate annual limit.
a) Such insurance shall apply to professional errors, acts, or omissions arising out of
the scope of services covered by the specific contract.
11
b) If coverage is written on a claims-made policy, Lessee warrants that any applicable
retroactive date precedes the effective date of the contract; and that continuous coverage will be
maintained, or an extended period exercised for not less than three (3) years and shall cover third
party claims resulting from invasion of privacy, theft of data, data corruption and restoration.
11. Marina Operator Legal Liability Insurance is required to be maintained by
sublessees that operate vessels with a limit of not less than (i) in the case of large, multi-vessel
commercial operators, Twenty Million Dollars ($20,000,000) per occurrence and (ii) in the case
of commercial single vessel operators, One Million Dollars ($1,000,000) per occurrence. Such
insurance shall provide coverage at a minimum for loss or damage to third party vessels, property
in the care, custody or control of Lessee, including but not limited to vessels for a rental fee at
docks, mooring at slips, moorings or buoys. Such coverage shall not exclude hauling out or
launching in connection with services provided and shall not exclude additional miscellaneous
servicing of a transient nature at the Premise. Lessee shall require owners of pleasure boats who
lease slips from Lessee to add coverage for the pleasure boats to their homeowner’s or personal
liability umbrella policies.
12. Lessee shall maintain basic business interruption insurance in an amount not less
than one year’s Fixed Base Rent to the extent obtainable (“Business Interruption Insurance”).
Business Interruption Insurance shall be carried in favor of Lessee as aforesaid, but the proceeds
thereof to the extent of one year of Fixed Base Rent shall be paid to Depository and shall be applied
to the Rent payable by Lessee under the Lease until completion of required Restoration by Lessee
at which time any remaining balance shall be paid to Lessee by Depository and the proceeds
thereof in excess of one year of Fixed Base Rent shall be paid directly to Lessee.
12
Lessee and HRPT shall cooperate in connection with the collection of any insurance
proceeds that may be due in the event of loss, and each party shall execute and deliver such proofs
of loss and other instruments that may be required for the purpose of obtaining the recovery of any
such insurance proceeds (and the obligations of the parties under this sentence shall survive the
expiration or earlier termination of the Lease). With respect to liability insurance written on a
“claims made” basis, at the expiration or earlier termination of the Lease, Lessee shall put in place
an extended reporting period having a duration of no less than six (6) years.
1
EXHIBIT G
PUBLIC ACCESS AREA
1
EXHIBIT H
TRAFFIC AND PEDESTRIAN MANAGEMENT PLAN
2
Chelsea Piers Traffic and Pedestrian Management Plan
Location 1: Within Rte 9A Access Parcel II Easement Area fixed post
Fixed post during day and evening operating hours (7 a.m. to 10 p.m.). Lessee to provide direction
at this traffic signal-controlled intersection to minimize conflicts between vehicles entering
Lessee
driveway and bike path traffic and pedestrians using the 22
nd
Street
crossing. Lessee is not
responsible for controlling bikeway traffic or pedestrians not within Premises.
Locations 2A and 2B: Within Premises only at 18
th
Street and 20
th
Street pedestrian
crossings
of driveway during events and periods of vehicular and pedestrian congestion
Lessee to direct pedestrians exiting from the Premises to the Rte 9A crosswalks so as to minimize
congestion and spill over to the bike path. Lessee also to direct vehicles to give right of way to
pedestrians at pedestrian crossings of driveway. Lessee not responsible for controlling bikeway
traffic or pedestrian movement not within the Premises. For the avoidance of any doubt, as set
forth in this paragraph, Lessee is not responsible for managing overcrowding in the pedestrian
reservoir buffer area
Location 4A: Within Premises only south of the pay station during events and periods of
vehicular and pedestrian congestion
Lessee to monitor vehicles exiting the Premises to minimize the likelihood of exiting vehicles
blocking
the bike path or creating blockage on Rte. 9A when traffic light cycles red. If blockage
appears likely, Lessee’s traffic and pedestrian management personnel at Location 4A shall notify
parking attendants at parking fee collection booth(s) to direct vehicles to hold their positions until
blockage clears.
Locations 4A, 4B, and 4C: Within Premises only at Pier 59, Pier 60 and Pier 61 garage
entrance crossing of sidewalk during events and periods of vehicular and pedestrian
congestion
Lessee to direct entering/exiting garage vehicular traffic to give right of way to pedestrians
crossing along the sidewalk and to direct pedestrians to hold while vehicles are within the
crossing.
3
Locations 5A and 5B: Within interior garage locations at Pier 60 and Pier 61 vehicular
crossings
of Sunset Strip during events and periods of vehicular and pedestrian
congestion
Lessee to direct entering/exiting garage vehicular traffic give right of way to pedestrians at
pedestrian crossings, and to direct pedestrians to hold while vehicles are within the crossing.
Locations 6A and 6B: Directions to Patrons Exiting Chelsea Piers during period
of
1 am
to 6 am
Lessee to direct all Chelsea Piers patrons exiting Chelsea Piers during period 1 am to 6 am to
exit Chelsea Piers through the Pier 60 and Pier 61 driveway exits and to use the pedestrian
crosswalks at 18th, 20th and 22nd street, or if bicycling, the bike path. Lessee to place metal
barricades to deter Lessee’s exiting patrons from entering the park directly from Chelsea Piers
during the period 1 am to 6 am at locations 6A and 6B, and close overhead door at south exit
from Pier 59 and north exit from Pier 62. Lessee may in its reasonable discretion deploy additional
barricades within the Premises to direct Chelsea Piers patrons’ path of egress. Lessee shall
actively monitor (through direct observation and/or use of CCTV) park entrance entry points from
Chelsea Piers and promptly deploy Lessee’s traffic and pedestrian management personnel to
such entry points should an unauthorized park entry attempt be observed. Lessee shall notify
Lessor’s 24- hour security desk should it detect any unauthorized entry into the park from Chelsea
Piers that it was unable to deter during the period 1 am to 6 am. Should the number or frequency
of such unauthorized entries be, in the reasonable judgement of Lessor or as independently
determined by Lessee, excessive, Lessee shall consult with Lessor and thereafter devise and
implement such supplemental measures as may be necessary and appropriate to deter Lessee’s
exiting patrons from entering the park.
The number of Lessee’s traffic and pedestrian management personnel deployed in accordance
with this Traffic and Pedestrian Management Plan shall vary
and increase during event and
congested conditions as observed in the reasonable judgement of Lessee. There shall, at a
minimum, be two (2) such Lessee traffic and pedestrian management team members deployed
at all times during the period 7 a.m. to 10 p.m. (one at Location 1 and one roving along
the
driveway and sidewalk area of the eastern frontage) and others available for deployment during
10 p.m. to 7 a.m. period should conditions warrant.
Lessee’s traffic and pedestrian management and other personnel deployed in accordance with
this Traffic and Pedestrian Management Plan must wear high visibility reflective vest and use
appropriate traffic safety equipment, and must be adequately trained for their duties in the
reasonable judgement of Lessee.
With the exception of Location 1, all locations included in this Traffic and Pedestrian Management
Plan are within the Premises.
4
-1-
9796273.22
EXHIBIT I
NEW YORK STATE NON-DISTURBANCE AND ATTORNMENT AGREEMENT
2
==============================================================
SUBORDINATION, RECOGNITION, NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
by and among
THE STATE OF NEW YORK, as Fee Owner, ACTING THROUGH THE OFFICE
OF PARKS, RECREATION AND HISTORIC PRESERVATION, THE DEPARTMENT
OF ENVIRONMENTAL CONSERVATION AND THE OFFICE OF GENERAL
SERVICES
and
CHELSEA PIERS L.P. AND NORTH RIVER OPERATING COMPANY L.P., as
Subtenant
Dated: [_______]
Affecting the property known as Piers 59, 60, 61 and Headhouse located on West Street at
West 17th to 22nd Streets in the Borough of Manhattan, City and State of New York, together
with certain adjacent upland and in-water areas
Block 662, Lots 11,16 and 19 and portions of Lots 7 and 62
===============================================================
3
SUBORDINATION, RECOGNITION, NON-DISTURBANCE AND ATTORNMENT
AGREEMENT
THIS SUBORDINATION, RECOGNITION, NON-DISTURBANCE AND
ATTORNMENT AGREEMENT (this “Agreement”) made as of ____________, by and among
THE STATE OF NEW YORK (the “State”), ACTING THROUGH ITS OFFICE OF
PARKS, RECREATION AND HISTORIC PRESERVATION (“OPRHP”), whose address
for notice under this Agreement is NYS OPRHP, 625 Broadway, Albany, New York 12207 AND
THROUGH ITS DEPARTMENT OF ENVIRONMENTAL CONSERVATION (“DEC”),
whose address for notice under this Agreement is NYS DEC, 625 Broadway, Albany, New York
12233 AND THROUGH ITS OFFICE OF GENERAL SERVICES (“OGS”), whose address
for notice under this Agreement is OGS, Empire State Plaza, Corning Tower, 41st Floor, Albany,
New York 12242, and CHELSEA PIERS L.P. and NORTH RIVER OPERATING
COMPANY L.P. (together with their successors and assigns, the “Subtenant”), whose address
for notice under this Agreement is Chelsea Piers, Pier 62, Suite 300, New York, New York 10011.
Introductory Provisions
A. Pursuant to the Hudson River Park Act, Chapter 592 of the Laws of 1998 of the
State of New York (as amended from time to time, the “Act”), the Hudson River Park Trust
(“HRPT”) has been duly created as a body corporate and politic constituting a public benefit
corporation, for the purpose of planning, designing, developing, constructing, operating and
maintaining the Hudson River Park as more specifically defined and described in the Act (the
“Park”).
B. In accordance with the Act, the State, by and through OPRHP and DEC, and HRPT
entered into that certain Agreement, dated as of April 3, 1999, as amended by that certain letter
agreement dated February 9, 2016 extending the term to March 31, 2122 and modifying the
boundaries, and that second amendment to the Agreement dated January 22, 2020 to address
insurance and indemnification obligations and that third amendment to the Agreement dated June
2, 2021 modifying the northern portion of the State-owned portion of the Park, (as the same may
be further amended, modified or supplemented from time to time, the “State Lease”), conveying
to HRPT a possessory interest in the State-owned property in the Park (including the Chelsea Piers
Property as defined below) and confirming HRPT’s powers and obligations with respect to the
Park as set forth in the Act.
C. Subtenant, is the tenant under that certain Lease Agreement, dated as of [____] (as
the same may be amended, restated, supplemented and otherwise modified from time to time, the
“Chelsea Piers Lease”), between HRPT, as sublandlord, and the Subtenant, as subtenant, pursuant
to which the Subtenant leases all of the real property described on Exhibit A (the “Chelsea Piers
Property”).
D. OGS has the authority to perform the duties of the State, as sublandlord, under
Public Lands Law § 3(2), which provides, in pertinent part, that OGS may grant rights in perpetuity
or otherwise in and to all State lands.
4
E. The parties are now entering into this Agreement for the purpose of confirming
their understandings and agreements with respect to (a) the State’s agreement not to disturb
Subtenant’s or any Successor Subtenant’s (as defined below) possession of the Chelsea Piers
Property under the Chelsea Piers Lease and recognition of Subtenant (or Successor Subtenant) as
a direct tenant of the State; and (b) Subtenant’s (and Successor Subtenant’s) agreement to attorn
to the State, under the terms of the Chelsea Piers Lease and this Agreement, in the event that the
State Lease is terminated (whether by operation of law or otherwise).
NOW, THEREFORE, the parties hereto, in consideration of the covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, hereby agree as follows:
1. Subordination of Chelsea Piers Lease. Subtenant hereby confirms on behalf
of itself and any Successor Subtenant that Subtenant’s leasehold interest in the Chelsea Piers Lease
is and shall at all times continue to be subject and subordinate in all respects to the State Lease.
As used herein, a “Successor Subtenant” shall be any successor owner of Subtenant’s interest in
the Chelsea Piers Lease, including, without limitation, any successor or assign of Subtenant, any
person that becomes the “lessee” under the Chelsea Piers Lease and takes possession of the Chelsea
Piers Property, any holder of a leasehold mortgage that forecloses (or receives an assignment in
lieu of foreclosure) and succeeds to Subtenant’s interest under the Chelsea Piers Lease (including
pursuant to a “new lease” as provided for in Article 8 of the Chelsea Piers Lease), any holder of a
pledge of Subtenant’s equity interests that forecloses on said interests, any other purchaser of
Subtenant’s interest in the Chelsea Piers Lease upon or following a foreclosure or any successor,
assign or nominee of the foregoing.
2. Recognition by the State. The State and Subtenant hereby agree that in the
event the State Lease is terminated or the State otherwise acquires or succeeds to HRPT’s interest
as lessor under the Chelsea Piers Lease (the date upon which any such event occurs hereinafter
being referred to as the “Succession Date”), then, provided that on the Succession Date no event
of default exists and is continuing under the Chelsea Piers Lease (beyond applicable notice and
cure periods) which would permit HRPT to terminate the Chelsea Piers Lease or exercise any
dispossess remedy provided for in the Chelsea Piers Lease, the Chelsea Piers Lease shall continue
as a direct lease between the State and Subtenant (or Successor Subtenant, as applicable) upon all
of the terms, covenants, conditions and agreements set forth in the Chelsea Piers Lease and
remaining to be performed, with the same force and effect as if the State, as lessor, and Subtenant
(or Successor Subtenant, as applicable), as lessee, had entered into a lease (on such terms,
covenants and conditions, including any renewals thereof) as of the date of the termination of the
State Lease, for a term equal to the unexpired term of the Chelsea Piers Lease, including any
renewal option to which Subtenant (or Successor Subtenant, as applicable) is entitled. At the
request of either party, the State and Subtenant (or Successor Subtenant, as applicable) shall
execute and exchange an instrument in recordable form confirming such direct lease relationship,
but the failure of either party to execute such instrument shall not affect their rights and obligations
with respect to said direct lease relationship.
3. Attornment by Subtenant. As of the Succession Date, Subtenant (or
Successor Subtenant, as applicable) agrees to be bound by said direct lease relationship and to
attorn to the State and recognize the State as its lessor and shall pay its rent, additional rent and all
other sums due under the Chelsea Piers Lease at the address designated by the State by written
5
notice to Subtenant from time to time. Notwithstanding the foregoing or anything else contained
in this Agreement, neither the State, nor anyone claiming by, through or under the State, shall be:
(a) liable for any prior act or omission of HRPT or any prior lessor or
consequential damages arising therefrom unless the State has failed to cure any default by HRPT
that continues from and after the Succession Date; or
(b) subject to any offsets or defenses which Subtenant (or Successor Subtenant,
as applicable) might have as to HRPT or any prior lessor unless the State has failed to cure any
default by HRPT as herein provided, and, in that event, only such offsets and defenses as shall
have accrued from and after the Succession Date; or
(c) required or obligated to credit Subtenant (or Successor Subtenant, as
applicable) with any rent or additional rent for any rental period beyond the then current month
which Subtenant (or Successor Subtenant, as applicable) might have paid HRPT or any prior
lessor; or
(d) bound by any amendments or modifications of the Chelsea Piers Lease
following the date hereof that is not specifically referenced in the Chelsea Piers Lease and reduces
the rental payable under the Chelsea Piers Lease, shortens or lengthens the term or otherwise
increases the obligations of the lessor or reduces the benefits to the lessor that are made without
the State’s prior written consent; or
(e) liable for refund of all or any part of any security deposit unless such
security deposit shall have been actually received by the State.
4. Recognition of Mortgagee(s). The State hereby acknowledges and agrees
that in the event the State Lease is terminated or the State otherwise acquires or succeeds to
HRPT’s interest as lessor under the Chelsea Piers Lease, that it shall recognize the rights of the
Mortgagee(s) (as such term is defined in the Chelsea Piers Lease) thereunder upon all of the terms,
covenants, conditions and agreements set forth in the Chelsea Piers Lease (including, without
limitation, the right to a “new lease” on the same terms and conditions as the then-executed lease).
At the request of the State or the Mortgagee(s), the applicable parties shall execute and exchange
an instrument confirming such recognition, but the failure of either party to execute such
instrument shall not affect their rights and obligations with respect to said recognition. Nothing in
this Agreement shall impose any liability upon a Mortgagee for the obligations of Subtenant unless
and until such Mortgagee takes title to Subtenant’s interests under the Chelsea Piers Lease pursuant
to the terms and conditions of the Chelsea Piers Lease.
5. Performance by OGS as sublandlord. If the State acquires or succeeds to
HRPT’s interest as lessor under the Chelsea Piers Lease and OPRHP and DEC are statutorily
unable to perform the obligations of the State as lessor as set forth in paragraphs 2, 3, and 4 hereof,
then, in such event, upon the request of OPRHP and DEC, OGS shall perform the duties of the
State under this Agreement and shall in all respects be considered as acting on behalf of the State
as lessor.
6. Transfer of Fee Title to the Property. If the State transfers fee title to the
Property and the landlord’s or lessor’s interest in the State Lease to an entity other than New York
City or New York State or any agency of instrumentality of either such party, then the State shall
6
request that the transferee enter into an agreement with Sublandlord and Subtenant substantially
similar to this Agreement, but the State shall have no liability if it is unable to obtain such an
agreement on behalf of the Subtenant.
7. Representations. Subtenant represents and warrants to the State that
Subtenant has provided the State with a true, correct and complete copy of the Chelsea Piers Lease,
including all amendments, modifications, extensions and supplements thereto. OPRHP and DEC
represent and warrant that they have not delivered to HRPT any written notice of default under the
State Lease that has not been cured as of the date hereof. Each party to this Agreement represents
and warrants to each other party that it has full power and authority to enter into and perform this
Agreement and that the undersigned signatory is a duly authorized officer, signatory, member or
partner (as applicable) of such party.
8. Further Assurances. Each party shall promptly execute and deliver any
further agreement or other instrument in recordable form reasonably acceptable to the other party,
as applicable, which may be necessary or appropriate to evidence such recognition, attornment or
direct lease relationship, but the failure to do so shall not affect the rights and obligations of the
parties under this Agreement.
8. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which together shall constitute
and be construed as one and the same instrument.
9. Notices. All notices or other communications required or permitted to be
given pursuant to this Agreement shall be in writing and shall be considered as properly given if
(a) mailed by first class United States mail, postage prepaid, registered or certified with return
receipt requested; (b) by delivering same in person to the intended addressee; or (c) by delivery to
an independent third party commercial delivery service for same day or next day delivery and
providing for evidence of receipt at the office of the intended addressee. Notice so mailed shall
be effective upon its deposit with the United States Postal Service or any successor thereto; notice
sent by a commercial delivery service shall be effective upon delivery to such commercial delivery
service; notice given by personal delivery shall be effective only if and when received by the
addressee; and notice given by other means shall be effective only if and when received at the
office or designated address of the intended addressee. For purposes of notice, the addresses of
the parties shall be set forth below; provided, however, that every party shall have the right to
change its address for notice hereunder to any other location within the continental United States
by the giving of thirty (30) days’ notice to the other parties in the manner set forth herein.
if to the State at: to OPRHP:
NYS Office of Parks, Recreation and Historic
Preservation
Office of General Counsel
625 Broadway
Albany, NY 12207
7
and to DEC:
NYS Department of Environmental Conservation
Office of General Counsel
625 Broadway
Albany, NY 12233
and to OGS:
NYS Office of General Services
Legal Services
Empire State Plaza
Corning Tower, 41st Floor
Albany, New York 12242
if to the Subtenant at:
Chelsea Piers L.P. and North River Operating
Company L.P.
Pier 62
Suite 300
New York, NY 10011
Attn: Executive Vice President, Chelsea Piers
Management Inc.
10. Required Standard Clauses. Appendix A. Standard Clauses for All New
York State Contracts, is attached hereto and made part of this agreement as if fully set forth herein.
11. Governing Law. This Agreement shall be interpreted and construed in
accordance with and governed by the laws of the State of New York.
12. Successors and Assigns. This Agreement shall apply to, bind and inure to
the benefit of the parties hereto and their respective successors and assigns.
13. Jurisdiction. The parties hereto hereby irrevocably and unconditionally
submit to the nonexclusive jurisdiction of the Supreme Court of the State of New York sitting in
New York County and of the United States District Court of the Southern District of New York,
and any appellate court thereof, in any action or proceeding arising out of or relating to this
Agreement or any agreement, instrument or document executed and delivered pursuant to this
Agreement, or for recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent permitted by
law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.
8
14. Entire Agreement. This Agreement contains all the promises, agreements,
conditions, inducements and understandings between the parties hereto and there are no promises,
agreements, conditions, understandings, inducements, warranties, or representations, oral or
written, expressed or implied, between them other than as herein or therein set forth and other than
as may be expressly contained in any written agreement between the parties executed
simultaneously herewith.
The remainder of this page is blank. The signature pages follow.
9
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the
day and year first written above.
STATE:
NEW YORK STATE OFFICE OF
PARKS, RECREATION AND HISTORIC
PRESERVATION
By: ____________________________
Name:
Title:
NEW YORK STATE DEPARTMENT OF
ENVIRONMENTAL CONSERVATION
By: ____________________________
Name:
Title:
NEW YORK STATE OFFICE OF
GENERAL SERVICES
By: ____________________________
Name:
Title:
SUBTENANT:
CHELSEA PIERS L.P.
By: Chelsea Piers Management Inc.,
General Partner
By:
Name:
Title:
10
NORTH RIVER OPERATING
COMPANY L.P.
By: Chelsea Piers Management Inc.
General Partner
By:
Name:
Title:
11
STATE OF NEW YORK )
) ss.:
COUNTY OF ALBANY )
On the _____ day of _____, in the year 20__, before me, the undersigned, personally
appeared __________, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument and acknowledged
to me that she executed the same in her capacity, and that by her signature on the instrument, the
individual, or the person upon behalf of which the individual acted, executed the instrument.
____________________________________
Notary Public
STATE OF NEW YORK )
) ss.:
COUNTY OF ALBANY )
On the _____ day of _______, in the year ______, before me, the undersigned, personally
appeared ________________________, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity, and that by his signature on the
instrument, the individual, or the person upon behalf of which the individual acted, executed the
instrument.
____________________________________
Notary Public
STATE OF NEW YORK )
) ss.:
COUNTY OF ALBANY )
On the _____ day of _____, in the year 20__, before me, the undersigned, personally
appeared __________, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument and acknowledged
to me that she executed the same in her capacity, and that by her signature on the instrument, the
individual, or the person upon behalf of which the individual acted, executed the instrument.
____________________________________
Notary Public
12
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the _____ day of _______, in the year ______, before me, the undersigned, personally
appeared ________________________, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is subscribed to the within instrument and
acknowledged to me that he/she executed the same in his/her capacity, and that by his/her
signature on the instrument, the individual, or the person upon behalf of which the individual
acted, executed the instrument.
____________________________________
Notary Public
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the _____ day of _______, in the year ______, before me, the undersigned, personally
appeared ________________________, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is subscribed to the within instrument and
acknowledged to me that he/she executed the same in his/her capacity, and that by his/her signature
on the instrument, the individual, or the person upon behalf of which the individual acted, executed
the instrument.
____________________________________
Notary Public
13
Exhibit A
Legal Description of Chelsea Piers Property
-1-
9796273.22
EXHIBIT J-1
EXISTING SIGNAGE
2
EXHIBIT J-2
SIGNAGE PLAN
[TO BE INSERTED AT LATER DATE]
3
EXHIBIT J-2A
PRELIMINARY SIGNAGE
1
EXHIBIT K
USABLE SQUARE FOOTAGE SUMMARY
2
EXHIBIT L
DEPICTION OF HEADHOUSE
3
EXHIBIT M
CHELSEA PIERS MAY 10, 2022 LETTER TO COMMUNITY BOARD 4
4
EXHIBIT N
1. Lessee and Lessor confirm and acknowledge that an essential element of this Lease is
the requirement of Article IX of this Lease that Lessee undertake and complete improvements to
the Public Access Areas including the Baseline Public Access Improvements and the Enhanced
Public Access Improvements. A fundamental objective of the Public Access Improvements is to
enable, facilitate and encourage greater access by the public to and utilization of the waterfront
bordering the Premises. The Public Access Improvements include an expanded Pier 59 platform
and an expanded and enhanced entrance at the south end of the Pier 59 headhouse; a widened and
re-imagined interior walkway through the Premises with improved paving, lighting and signage
and connections to the waterfront perimeter of the Premises; and a range of concomitant
improvements to make the waterfront perimeter of the Premises more inviting, accessible and
enjoyable. Lessee and Lessor envision that a cumulative effect of the Public Access Improvements
will be to reduce pedestrian and jogger use of the Service Road Sidewalks to transit from the
Premises to the Park at the north and at the south ends of the Premises.
2. At the same time, Lessee and Lessor agree that an important common objective of the
parties is to reduce vehicular traffic use of the existing three lane roadway located to the east of
the Service Road Sidewalks (the “Premises Roadway”) and thereby create opportunities for
expanded public pedestrian circulation and access, all to the extent practicable and consistent with
the operational needs of Lessee. Lessor acknowledges and agrees that such expansion of public
pedestrian circulation and access shall not be undertaken in a manner that is not mutually agreed
by Lessee and Lessor as set forth herein or that causes a material adverse impact to Lessee’s
existing and reasonably anticipated permissible use of the Premises or causes Lessee to bear an
unreasonable cost.
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3. Lessee shall, in good faith, provide reasonable cooperation and participate with Lessor
and such third-parties that Lessor may designate (and which such third-parties may agree to
participate), including, but not limited to, Manhattan Community Board 4 and New York City and
New York State departments of transportation, in periodic planning efforts to analyze current and
anticipated vehicular traffic conditions on the Premises Roadway and evaluate potential vehicular
traffic reduction strategies and public pedestrian access expansion alternatives (each such periodic
planning effort, an “Eastern Frontage Planning Effort”).
4. Each Eastern Frontage Planning Effort shall include, but not be limited to, consideration
of off-site traffic improvements implemented or planned by the City and State departments of
transportation that affect the Premises, the manner and extent to which Public Access
Improvements undertaken by Lessee are being utilized, the extent to which Public Access
Improvements have accomplished the objective of re-orienting pedestrians and joggers toward the
waterfront thereby reducing pedestrian and jogger use of the Service Road Sidewalks (and what
further enhancements of the Public Access Improvements could increase the effectiveness of the
improvements in this regard), patterns and trends of Park use and Lessee’s business use, traffic
patterns on the adjacent portions of Rte 9A, and the approximate costs of implementing the
identified public pedestrian access expansion alternatives. If and to the extent that Lessee and
Lessor each elect to employ the services of traffic engineers or other third-party professionals in
connection with its participation in an Eastern Frontage Planning Effort, then each party shall be
solely responsible for its respective costs.
5. The initial Eastern Frontage Planning Effort shall commence at the earlier of (a) five
years after the substantial completion of the Public Access Improvements undertaken by Lessee,
and (b) the end of the seventh (7
th
) Lease Year. Subsequent Eastern Frontage Planning Efforts,
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shall commence every ten (10) years after the completion of the prior Eastern Frontage Planning
Effort, or upon such other dates as Lessee and Lessor may agree. Lessor and Lessee shall make
reasonable efforts to conclude each Eastern Frontage Planning Effort within six (6) months of
initiation.
6. Upon the earlier to occur of the completion of an Eastern Frontage Planning Effort or a
Significant Change Event (as defined herein), Lessor and Lessee shall each provide reasonable
cooperation and consult in good faith to mutually determine whether one or more of the public
pedestrian access expansion alternatives identified in the course of the applicable Eastern Frontage
Planning Effort may be implemented and the schedule for construction work in connection
therewith. In making such mutual determination, Lessor and Lessee shall each exercise reasonable
and good faith judgement to evaluate and determine whether such implementation is warranted
and feasible given the criteria set forth herein, including with particularity that there shall be no
material adverse impact on Lessee’s existing and reasonably anticipated permissible use of the
Premises and the common objective of the parties for further public access improvements. Lessor
agrees that the construction cost of implementing the selected public pedestrian access expansion
alternatives shall be reasonable, and that such cost shall be equitably apportioned by mutual
agreement between Lessor and Lessee in a manner that does not create an unreasonable financial
burden on Lessee. Lessee agrees that Lessor’s apportioned cost share of construction (to the extent
that such construction is performed and paid in the first instance by Lessee) shall be recognized as
a Fixed Base Rent credit granted to Lessee in equal monthly installments with an annual amount
not to exceed five hundred thousand dollars ($500,000) for each Lease Year during the period of
such credit.
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7. For the purposes set forth herein, a “Significant Change Event” shall be defined as (i)
the imposition of any rule or regulation by a Governmental Authority, or any technological or
consumer behavior change affecting vehicular traffic use generally, the cumulative effect of which
is likely to cause a material and permanent reduction in the volume of vehicular traffic that enters
the Premises Roadway, (ii) a significant off-site change to Rte 9A, inclusive of the bikeway,
undertaken by a Governmental Authority, (iii) one or more change in Lessee’s use of the Premises
that is likely to extend for all or most of the remainder of the Term, the cumulative effect of which
is likely to materially reduce the volume of vehicular traffic that enters the Premises Roadway, or
(iv) any other event or change upon which Lessor and Lessor may mutually agree.
8. In addition, to help realize Lessor’s and Lessee’s common objective to reduce traffic on
the Premises Roadway to the extent practicable and consistent with the operational needs of Lessee
and its Occupants, Lessee agrees that, upon the Commencement Date and thereafter throughout
the Term, it shall limit parking on the Premises Roadway to that parking for which there is no
commercially reasonable and practical alternative and shall direct vehicles seeking parking to
interior garage areas to the maximum extent both feasible and practicable.
9. Lessor acknowledges and agrees that Lessee shall be under no obligation to implement
and bear the cost of any specific public Premises Roadway pedestrian access expansion
alternatives except as mutually agreed by Lessor and Lessee, each acting reasonably and in good
faith, as set forth herein.
