Pre-Effective Amendment to Registration Statement (General Form) — Form S-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-1/A Amendment No.1 to Form S-1 164 964K
2: EX-3.1 Certificate of Incorporation 6 26K
3: EX-3.2B Amended Certificate of Designations 23 65K
4: EX-3.3 Certificate of Designation (Cumulative Voting) 12 36K
5: EX-3.4 Certificate of Designation (Redeemable Voting) 21 58K
6: EX-3.5 Restated By-Laws of the Registrant 20 79K
7: EX-4.2 Specimen Common Stock Certificate 2 14K
8: EX-5 Opinion of Thomas A. Russo, Esq. 2 16K
9: EX-7 Opinion of Skadden, Arps, Slate, Meagher & Flom 4 21K
10: EX-8 Opinion of Skadden, Arps, Slate, Meagher & Flom 2 15K
11: EX-10.1 Form of Agreement of Tenants-In-Common 150 249K
14: EX-10.10B Form of Warrant 28 52K
15: EX-10.17 Voluntary Deferred Compensation Plan 21 87K
16: EX-10.18 Executive and Select Employees Plan 10 26K
12: EX-10.2 Restated Tax Allocation Agreement 67 178K
17: EX-10.20 The E.F. Hutton Partnership Award Plan 20 83K
18: EX-10.23 Lehman Brothers Inc. Employee Ownership Plan 25 100K
19: EX-10.23A Amended Employee Ownership Plan 1 11K
20: EX-10.24 1994 Management Ownership Plan. 26 89K
21: EX-10.25 1994 Management Replacement Plan. 16 58K
22: EX-10.26 Short-Term Executive Compensation Plan 7 30K
23: EX-10.27 1994 Employee Stock Purchase Plan 17 61K
24: EX-10.28 Participating Preferred Plan 19 61K
25: EX-10.28A Amendment to Particpating Preferred Plan 1 11K
26: EX-10.29 Purchase and Exchange Agreement 17 61K
13: EX-10.3 Intercompany Agreement 30 85K
27: EX-10.30 Registration Rights Agreement 31 55K
28: EX-10.31 Option Agreement 45 85K
29: EX-10.32 Form of 1994 Agreement 35 102K
30: EX-10.33 Compensation Plan (For Select Executives) 21 87K
31: EX-10.34 Compensation Plan ( for Transferred Participants ) 22 90K
32: EX-10.35 Executive and Select Employee Plan 11 26K
33: EX-23.1 Consent of Ernst & Young 1 11K
34: EX-23.4 Consent of Lazard Freres & Co. 1 11K
35: EX-23.5 Consent of James D. Wolfensohn Incorporated 1 11K
FORM OF RESTATED AND AMENDED
AGREEMENT OF
TENANTS-IN-COMMON
BY AND AMONG
AMERICAN EXPRESS COMPANY,
AMERICAN EXPRESS BANK LTD.,
AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.,
LEHMAN BROTHERS INC.,
LEHMAN GOVERNMENT SECURITIES, INC., AND
LEHMAN COMMERCIAL PAPER INCORPORATED
PREMISES
AMERICAN EXPRESS TOWER
BATTERY PARK CITY
WORLD FINANCIAL CENTER
NEW YORK, NEW YORK
SECTION: 1
BLOCK: 16
LOT: 140
DATED AS OF MAY 31, 1994
TABLE OF CONTENTS
[Download Table]
PAGE
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RECITALS...............................................
DEFINITIONS............................................
ARTICLE
I. PURPOSES AND NATURE OF THIS AGREEMENT
1.01 Purposes of this Agreement....................
1.02 References to Co-Tenants; Designation
of Representatives............................
1.03 Interest and Space............................
1.04 Nature of this Agreement......................
II. MANAGEMENT OF THE PROPERTY
2.01 Managing Co-Tenant............................
2.02 Power and Authority Regarding Certain
Agreements....................................
2.03 Property Obligations..........................
2.04 Common Facilities.............................
2.05 Duties of Managing Co-Tenant; Co-Tenant's
Changes.......................................
2.06 Contracts.....................................
2.07 Management Company; Change of Managing
Co-Tenant.....................................
2.08 Building Security; Secure Areas...............
2.09 Debt Obligations..............................
2.10 Utilities; Utility Expenses; Utility
Facilities....................................
2.11 Use of Space..................................
2.12 Telecommunication Facilities and T.V.
Studio........................................
III. FINANCIAL MATTERS
3.01 Budgets.......................................
3.02 Payment of Utility Expenses and Property
Obligations...................................
3.03 Payment of Debt Obligations...................
3.04 Funds of Co-Tenants...........................
ARTICLE PAGE
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3.05 Excess Funds..................................
3.06 Periodic Statements...........................
3.07 Books and Records.............................
3.08 Final Accounting..............................
3.09 Failure to Pay................................
3.10 Insurance.....................................
IV. TRANSFERS
4.01 Consent Required..............................
4.02 Subletting Permitted..........................
4.03 Assignments...................................
4.04 Additional Restrictions.......................
4.05 Transferee Use of Utility Facilities and
Limited Common Facilities.....................
4.06 Partition.....................................
4.07 Right of First Offer..........................
4.08 Right of First Refusal........................
4.09 Required Transfers............................
4.10 Brokerage.....................................
4.11 Right of Disapproval..........................
4.12 Submission to Condominium Regime..............
V. GENERAL
5.01 Notices.......................................
5.02 Entire Agreement..............................
5.03 Governing Laws................................
5.04 Waiver........................................
5.05 Severability..................................
5.06 Benefit.......................................
5.07 Terminology...................................
5.08 Status Reports................................
5.09 No Recording of this Agreement................
5.10 Binding Agreement.............................
5.11 Liability of Co-Tenants/Indemnification.......
5.12 Claims........................................
5.13 Consent or Approval...........................
5.14 Term..........................................
5.15 Arbitration...................................
5.16 Consumer Price Index..........................
5.17 Affirmative Action Program....................
5.18 Signs; Name of Building.......................
5.19 Rules and Regulations.........................
5.20 Power of Attorney.............................
EXHIBIT A - Description of Parcel C
EXHIBIT B - Space Exhibit
EXHIBIT C - Common Facilities
EXHIBIT D - Employee Assistance Program Services
EXHIBIT E - Intentionally Deleted
EXHIBIT F - Secure Areas
EXHIBIT G - Form of Budget
EXHIBIT H - Fitness Center Services
EXHIBIT I - Medical Center Services
EXHIBIT J - Designated Locations for Lehman Messenger Center
and Lehman Incoming Delivery Station
THIS SECOND RESTATED AND AMENDED AGREEMENT ("Agreement") made as of this
31st day of May, 1994, by and among AMERICAN EXPRESS COMPANY ("Amexco"), a New
York corporation, AMERICAN EXPRESS BANK LTD. ("AEBL"), a Connecticut
corporation formerly known as American Express International Banking
Corporation, AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC. ("TRSCO"),
a New York corporation, LEHMAN BROTHERS INC. ("Lehman"), a Delaware corporation
formerly known as Shearson Lehman Brothers Inc., Shearson/American Express Inc.
and/or Shearson Lehman/American Express Inc., LEHMAN GOVERNMENT SECURITIES,
INC. ("LGS"), a New York corporation formerly known as Shearson Lehman
Government Securities Inc., and LEHMAN COMMERCIAL PAPER INCORPORATED ("LCP"), a
New York corporation formerly known as Shearson Lehman Commercial Paper
Incorporated, each having an office at American Express Tower, Three World
Financial Center, New York, New York 10285.
RECITALS
A. Pursuant to a certain Agreement of Severance Lease dated as of June
15, 1983, by and between Battery Park City Authority ("BPCA"), a public benefit
corporation under the laws of the State of New York, as landlord, and Olympia &
York Battery Park Company ("O&Y"), a New York partnership, as tenant (as the
same may have been or as the same may hereafter be modified, amended, extended,
renewed or assigned, the "Lease"), a memorandum of which Lease was recorded in
the Office of the Register of the City of New York,
County of New York, in reel 696, page 472, O&Y became the owner of a leasehold
interest in certain real property commonly known as Parcel C at the Battery
Park City Commercial Center (also known as the World Financial Center),
together with certain easements and other rights in and to real property
appurtenant thereto, in the borough of Manhattan, City, County and State of New
York, all as more particularly described in Exhibit A annexed hereto and made a
part hereof.
B. By a certain Assignment of Severance Lease with Assumption, dated as
of June 15, 1983, and recorded in the Office of the Register of the City of New
York, County of New York, in reel 696, page 582, O&Y assigned to Amexco, AEBL,
TRSCO and Lehman, collectively, O&Y's interest as tenant under the Lease (the
"Leasehold"), and the obligations of tenant under the Lease were jointly and
severally assumed by Amexco, AEBL, TRSCO and Lehman.
C. BPCA, O&Y, and Amexco, AEBL, TRSCO and Lehman, collectively, executed
a Project Operating Agreement dated as of June 15, 1983 (as the same may have
been or as the same may hereafter be modified, amended, extended, renewed or
assigned, the "Project Operating Agreement"), relating to operation of the
Common Areas (as such term is defined in the Project Operating Agreement) of
the World Financial Center, and the rights and obligations of the parties with
respect thereto.
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D. Thereafter, a 51-story office building commonly known as the American
Express Tower located at Three World Financial Center, New York, New York, and
certain other improvements were constructed on Parcel C (collectively, "WFC" or
the "Building"). The Leasehold and the Building are sometimes collectively
referred to hereinafter as the "Property".
E. By separate instruments of assignment and assumption, each dated as of
May 30, 1985, Amexco, AEBL, TRSCO and Lehman, collectively as assignor,
assigned all of said assignor's right, title and interest in, to and under the
Lease and the Project Operating Agreement to Amexco, AEBL, TRSCO, Lehman, LGS
and LCP, collectively as assignee, and said assignee accepted such assign-
ments and assumed all of said assignor's obligations thereunder.
F. (1) Pursuant to a certain Indenture dated as of December 1, 1985 (the
"ABC Indenture") by and among the Tenants (hereinafter defined), as issuers,
Amexco, as guarantor, and Bankers Trust Company, as trustee (the "ABC
Trustee"), the Co-Tenants severally issued certain notes referred to as Series
A Guaranteed Notes Due 1989, Series B Guaranteed Notes Due 1992 and Series C
Guaranteed Notes Due 1997 in the aggregate principal amount of $272,690,000
(said notes, including any notes issued in exchange, substitution or
replacement thereof are hereinafter collectively referred to as the "ABC
Notes").
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(2) Pursuant to a certain Indenture dated as of June 1, 1985 (the "D
Indenture") by and among the Co-Tenants, as issuers, Amexco, as guarantor, and
Manufacturers Hanover Trust Company, as trustee (Bankers Trust Company having
assumed the obligations under said Indenture of Manufacturers Hanover Trust
Company, is hereinafter referred to as the "D Trustee"), the Co-Tenants
severally issued certain notes referred to as 11-5/8% Guaranteed Notes Due 2000
in the aggregate principal amount of $151,679,000 (said notes, including any
notes issued in exchange, substitution or replacement thereof are hereinafter
collectively referred to as the "D Notes").
(3) Pursuant to a certain Indenture dated as of June 1, 1985 (the "Z
Indenture") by and among the Co-Tenants, as issuers, Amexco, as guarantor, and
Chemical Bank, as trustee (the "Z Trustee"), the Co-Tenants severally issued
certain notes referred to as Zero Coupon Notes Due 2000 in the aggregate
original principal amount of $84,895,200 ($450,000,000 face amount payable at
maturity) (said notes, including any notes issued in exchange, substitution or
replacement thereof are hereinafter collectively referred to as the "Z Notes").
(4) Pursuant to a Note Purchase Agreement dated July 29, 1986 (the
"7.319% Purchase Agreement"), by and among the Co-Tenants, as issuers, Lehman
Special Securities Incorporated and Sumitomo Life Insurance Company, the
Co-Tenants severally issued certain notes guaranteed by Amexco referred to as
7.319% Guaranteed Notes Due 1996
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in an aggregate principal amount of $30,000,000 (said notes, including any
notes issued in exchange, substitution or replacement thereof are hereinafter
collectively referred to as the "7.319% Notes").
(5) Pursuant to a Note Purchase Agreement dated August 26, 1986 (the
"7.187% Purchase Agreement"), by and among the Co-Tenants, as issuers, and
Lehman Special Securities Incorporated, the Co-Tenants severally issued certain
notes guaranteed by Amexco referred to as 7.187% Guaranteed Notes Due 1996 in
an aggregate principal amount of $40,000,000 (said notes, including any notes
issued in exchange, substitution or replacement thereof are hereinafter
collectively referred to as the "7.187% Notes").
(6) Pursuant to a Loan Agreement dated July 29, 1986 (the "July Yen
Loan Agreement"), by and among the Co-Tenants, Amexco, as guarantor, Sumitomo
Life Insurance Company and The Long-Term Credit Bank of Japan, Limited, the
Co-Tenants borrowed on a several basis the aggregate principal amount of Yen
4,700,000,000, and the Co-Tenants entered into a related Currency Exchange
Agreement, dated July 29, 1986 (said loan, and the obligations under said
Currency Exchange Agreement, including any loans or exchange agreements made in
exchange, substitution or replacement thereof are hereinafter collectively
referred to as the "July Yen Loan").
(7) Pursuant to a Loan Agreement dated August 27, 1986 (the "August
Yen Loan Agreement"), by and among the Co-Tenants,
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Amexco, as guarantor, The Dai-Ichi Mutual Life Insurance Company and The
Long-Term Credit Bank of Japan, Limited, the Co-Tenants borrowed on a several
basis the aggregate principal amount of Yen 6,100,000,000, and the Co-Tenants
entered into a related Currency Exchange Agreement dated August 27, 1986 (said
loan, and the obligations under said Currency Exchange Agreement, including any
loans or exchange agreements made in exchange, substitution or replacement
thereof are hereinafter collectively referred to as the "August Yen Loan").
(8) Pursuant to a certain Indenture dated as of December 28, 1984 (the
"11.95% Indenture"), by and between American Express Company, as issuer, and
Morgan Guaranty Trust Company of New York, as Trustee (the "11.95% Trustee"),
Amexco issued its 11.95% Notes Due January 15, 1995 in the original aggregate
principal amount of $175,000,000 (said notes, including any notes issued in
exchange, substitution or replacement thereof are hereinafter collectively
referred to as the "11.95% Notes").
(9) The ABC Indenture, D Indenture, Z Indenture, 7.319% Purchase
Agreement, 7.187% Purchase Agreement, July Yen Loan Agreement, August Yen Loan
Agreement, 11.95% Indenture are collectively referred to hereinafter as the
"Existing Indentures". The Existing Indentures and any other indenture,
agreement or instrument under which the Co-Tenants or any of them shall issue
obligations the repayment of which may or shall from time to time be secured by
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instruments which encumber the Property or the proceeds of which shall be used
in connection with the Property, other than with respect solely to a
Co-Tenant's Space (hereinafter defined), are collectively referred to
hereinafter as the "Indentures". The ABC Notes, D Notes, Z Notes, 7.319%
Notes, 7.187% Notes, July Yen Loan, August Yen Loan and 11.95% Notes are
collectively referred to hereinafter as the "Existing Notes". The Existing
Notes and any other notes, exchange agreements or other instruments of the
Co-Tenants or any of them, the repayment of which may or shall from time to
time be secured by instruments which encumber the Property or the proceeds of
which shall be used in connection with the Property are collectively referred
to hereinafter as the "Notes".
G. (1) By a mortgage dated as of March 19, 1987 (the "Superior
Mortgage"), the Co-Tenants, as mortgagors, granted a leasehold mortgage in the
Property to the Z Trustee, as trustee, in order to secure the payment of the Z
Notes.
(2) By a mortgage dated as of March 19, 1987 (the "Subordinate
Mortgage"), the Co-Tenants, as mortgagors, granted a leasehold mortgage in the
Property to the ABC Trustee and the D Trustee, as trustees, in order to secure
the payment of the ABC and D Notes.
(3) The Superior Mortgage and the Subordinate Mortgage are
collectively referred to hereinafter as the "Existing Leasehold Mortgages".
The Existing Leasehold Mortgages and any other
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mortgages, deeds of trust or security agreements which may from time to time
encumber the Property are collectively referred to hereinafter as the
"Leasehold Mortgages".
H. By a certain agreement dated May 30, 1985 (the "American Express Tower
Operating Agreement"), the Co-Tenants set forth their agreement as to the
enforcement and discharge of certain of their respective rights and obligations
(i) as tenants-in-common of the Property, (ii) with respect to the operation of
the Building, and (iii) as parties to the Project Operating Agreement.
I. By agreement dated as of May 6, 1987 (the "Agreement of
Tenants-In-Common"), the Co-Tenants amended and restated in its entirety the
American Express Tower Operating Agreement in all respects.
J. It is the intention of the Co-Tenants that this Agreement further
amend and restate in its entirety the Agreement of Tenants-In-Common in all
respects, and that this Agreement shall supersede the Agreement of
Tenants-In-Common and the American Express Tower Operating Agreement.
K. Each Co-Tenant acknowledges and agrees that the Building is unique as
the headquarters facility of several major financial institutions and,
accordingly, there are significant security and business confidentiality
requirements and other concerns with respect to the occupants and owners
thereof in keeping with the desired character of the Building, as hereinafter
provided.
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Accordingly, the parties have agreed herein to many special and unique
restrictions on their rights to sell, assign, mortgage or sublet their
interests and space in the Building, which they specifically acknowledge they
believe to be reasonable under the circumstances.
DEFINITIONS
As used in this Agreement, the following terms shall have the
respective meanings ascribed to such terms below (all other initially
capitalized terms used but not otherwise defined herein shall have the meanings
ascribed to such terms in the Intercompany Agreement, dated as of the date
hereof, between Holdings (as defined herein) and Amexco):
"Distribution Date" shall mean the effective date of the distribution
to holders of common shares of Amexco of all outstanding shares of common stock
of Lehman Brothers Holdings Inc., a Delaware corporation ("Holdings") held by
Amexco.
"Employee Assistance Program Services" and "EAP Services" shall mean
(subject to modification pursuant to Section 2.04 II) the employee assistance
programs and services listed on Exhibit D hereto, it being understood that
Exhibit D is intended to describe the scope and level of services currently
being provided by Amexco to Lehman Co-Tenants' employees (including those
special services which are provided on an as-needed basis).
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"Fitness Center Services" shall mean (subject to modification pursuant
to Section 2.04 (III)) the fitness center services listed on Exhibit H hereto,
it being understood that Exhibit H is intended to describe the scope and level
of services currently being provided by Amexco to Lehman Co-Tenants' employees
(including those special services which are provided on an as-needed basis).
"Losses" shall mean, collectively, any and all costs and expenses
arising out of any claim or action (including, without limitation, attorneys'
fees, interest, penalties and costs of investigation or preparation for
defense), judgments, fines, losses, claims, damages, liabilities, demands,
assessments and amounts paid in settlement.
"Medical Center Services" shall mean (subject to modification pursuant
to Section 2.04 (IV)) the medical center services listed on Exhibit I hereto,
it being understood that Exhibit I is intended to describe the scope and level
of services currently being provided by Amexco to Lehman Co-Tenants' employees
(including those special services which are provided on an as-needed basis).
"Non-discriminatory Basis" shall mean with respect to any
modification, elimination or reduction in any benefits or services granted or
provided to Lehman Co-Tenants' employees and Amexco Co-Tenants' employees, a
basis for such modification, elimination or reduction which treats as one group
Lehman Co-Tenants' employees and Amexco Co-Tenants' employees.
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"Pre-Distribution Basis" shall mean with respect to any services, a
basis for the determination and allocation of the costs and expenses incurred
in providing such services which is substantially the same as that used by the
parties hereto in connection with the same or substantially similar services
immediately prior to the Distribution Date.
"WFC Indebtedness" shall mean, collectively, all of the Indentures,
Notes, and Leasehold Mortgages (as the same are referenced and defined in the
Recitals hereof).
ARTICLE I
PURPOSES AND NATURE OF THIS AGREEMENT
1.01. PURPOSES OF THIS AGREEMENT
Amexco, AEBL, TRSCO, Lehman, LGS and LCP hereby enter into this
Agreement (i) to amend and restate in its entirety the Agreement of
Tenants-In-Common in all respects, (ii) to set forth their respective rights,
obligations and interests as tenants-in- -common with respect to the Property,
(iii) to ensure their collective compliance with the terms, covenants and
conditions of the Lease, the Project Operating Agreement and the Leasehold
Mortgages, and (iv) to set forth their respective ongoing rights, obligations
and interests following the distribution to holders of common shares of Amexco
of all outstanding shares of common stock of Holdings held by Amexco.
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1.02. REFERENCES TO CO-TENANTS; DESIGNATION OF REPRESENTATIVES
(a) Amexco, AEBL, TRSCO, Lehman, LGS and LCP (and their respective
successors and assigns) are sometimes hereinafter referred to collectively as
the "Co-Tenants" and individually as a "Co-Tenant". Amexco, AEBL, TRSCO,
Lehman, LGS and LCP are sometimes hereinafter referred to collectively as the
"Initial Co-Tenants" and individually as an "Initial Co-Tenant".
(b) Amexco, AEBL and TRSCO (and their respective successors and
assigns) are sometimes hereinafter referred to collectively as the "AMEX
Co-Tenants". Lehman, LGS and LCP (and their respective successors and assigns)
are sometimes hereinafter referred to collectively as the "Lehman Co-Tenants".
(c) For themselves, their respective successors and assigns, the AMEX
Co-Tenants hereby designate and appoint Amexco, and the Lehman Co-Tenants
hereby designate and appoint Lehman, to be their sole representative in all
respects for any required or desired communications, notices, consents,
approvals, demands, or any other actions, in connection with or with respect to
this Agreement and all other activities of the Co-Tenants as tenants-in-common
of the Property. The within designation and appointment shall continue in
existence until such time as each of the AMEX Co-Tenants on one hand, or each
of the Lehman Co-Tenants on the other hand, shall designate and appoint another
Co-Tenant as their representative. The Co-Tenants may rely upon the actions of
Amexco
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with respect to the AMEX Co-Tenants, and Lehman with respect to the Lehman
Co-Tenants, as being binding, conclusive and duly authorized. Lehman and
Amexco, in their capacities as aforesaid, are sometimes hereinafter referred to
individually as a "Designated Co-Tenant" and jointly as the "Designated
Co-Tenants". The Designated Co-Tenant which is not then the Managing Co-
Tenant is sometimes hereinafter referred to as the "Non-Managing Designated
Co-Tenant".
1.03. INTEREST AND SPACE
(a) (i) Each Co-Tenant owns, as a tenant-in-common, an undivided
leasehold interest in the Property and said interest is hereinafter referred to
as the "Interest" of a Co-Tenant or as the "Interests" when referring to more
than one Co-Tenant.
(ii) Effective on the date of the transfer of the five floors by
the Amex Co-Tenants to the Lehman Co-Tenants as contemplated under that certain
Intercompany Agreement (the "Intercompany Agreement"), dated as of the date
hereof, between Holdings and Amexco, the aggregate Interests of the AMEX
Co-Tenants and the Lehman Co-Tenants in the Property will be as follows:
(1) AMEX Co-Tenants............. 48.53%
(2) Lehman Co-Tenants........... 51.47%
(b) Each of the Co-Tenants shall have (i) the exclusive right to
occupy a certain portion of space in the Property, subject to the easements
granted to the Managing Co-Tenant (as hereinafter defined) in Section 1.03(c)
and Section 2.10(b) hereof and any
13
access by the Managing Co-Tenant required for the performance of its duties
hereunder (subject to the provisions of this Agreement) and (ii) the
non-exclusive use and benefit, along with the other Co-Tenants, of the Common
Facilities (as defined in Section 2.04 hereof), subject to the provisions of
Section 4.05 with respect to Special Common Facilities (as defined in Section
2.04 hereof). That portion of the Property so occupied by each Co-Tenant shall
be hereinafter referred to with respect to each Co-Tenant as that Co-Tenant's
"Space". As of the date hereof, the Space occupied by the AMEX Co-Tenants and
the Lehman Co-Tenants is as set forth in Exhibit B annexed hereto and made a
part hereof. For purposes hereof, the term "Affiliate" shall mean a person
that directly, or indirectly through one or more intermediaries, controls, or
is controlled by, or is under common control with, an Initial Co-Tenant.
(c) The AMEX Co-Tenants and the Lehman Co-Tenants each hereby grant
to the Managing Co-Tenant an easement to enter upon their respective Spaces in
connection with the performance of all of the Managing Co-Tenant's duties
hereunder, subject, however, to the right, to be reasonably exercised, of any
Co-Tenant to condition access by the Managing Co-Tenant as to certain Secure
Areas (as defined in Section 2.08).
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1.04. NATURE OF THIS AGREEMENT
(a) This Agreement shall not constitute the Co-Tenants as, and the
Co-Tenants do not intend to be, partners or joint venturers with respect to the
Property or otherwise. Except as herein expressly and specifically provided,
this Agreement shall not (i) constitute any Co-Tenant the agent of any other
Co-Tenant, (ii) permit any Co-Tenant to have any authority to act for or to
assume any obligations or responsibilities on behalf of any other Co-Tenant,
(iii) in any manner limit or restrict the Co-Tenants in carrying on their
respective separate businesses or activities, (iv) impose upon either party any
fiduciary duty by reason of its carrying on its separate business or activity,
or (v) impose upon any Co-Tenant any liability or obligation.
(b) The Co-Tenants acknowledge that they have been informed that each
of the Co-Tenants is or may hereafter be a stockholder or affiliate of
corporations or a partner or co-venturer in partnerships and joint ventures
owning or operating real property, or is or may hereafter be an owner,
operator, or co-owner of real property. The Co-Tenants agree that the same
shall not be deemed a breach of duty on the part of a Co-Tenant to the other
Co-Tenants and shall not impose any greater or future obligation upon it.
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ARTICLE II
MANAGEMENT OF THE PROPERTY
2.01. MANAGING CO-TENANT
Subject to the terms and conditions of Section 2.02(c) hereof, AEBL,
TRSCO, Lehman, LGS and LCP hereby appoint Amexco to serve as the managing
Co-Tenant (the "Managing Co-Tenant") and to act as the agent on behalf of the
other Co-Tenants to supervise the operation of, and manage, the Property, in
accordance with the terms of this Agreement.
2.02. POWER AND AUTHORITY REGARDING CERTAIN AGREEMENTS
(a) Except as specifically provided in Section 2.02(b) hereof, each of the
Co-Tenants hereby grants to the Managing Co-Tenant full power and authority,
(i) with respect to the Project Operating Agreement, to serve as the
Co-Tenants' representative or representatives on the Management Committee (as
defined in the Project Operating Agreement) and, in connection therewith,
interact and negotiate with any of the parties to the Project Operating
Agreement on behalf of the Co-Tenants, and, further, to make decisions on
behalf of and to bind the Co-Tenants;
(ii) with respect to the Lease,
(A) to represent the Co-Tenants in all dealings with the landlord
under the Lease and to undertake all steps and procedures which Managing
Co-Tenant shall deem necessary or
16
desirable to protect the Co-Tenants' interest as tenant under the Lease, and,
further, to satisfy the obligations of and covenants by (and thereafter obtain
reimbursement from the other Co-Tenants pursuant to this Agreement), and to
enforce the rights and privileges of, the Co-Tenants under the Lease,
including, without limitation, by means of contesting and settling the
computation of any Rental (as defined in the Lease) due under the Lease;
(B) to represent the Co-Tenants in all dealings with any current
or future subtenants or other occupants occupying the Retail (as defined in the
Lease) space in the Building, including, without limitation, the negotiation,
amendment, renewal and termination of leases for the Retail space, the
collection of all rent due from said subtenants or occupants of said Retail
space, and the use of the same in accordance with the terms hereof, and to take
all steps and procedures which Managing Co-Tenant shall deem necessary or
desirable to protect the Co-Tenants' interest as sublandlord under any sublease
or occupancy agreements respecting said Retail space, and, further, to enforce
all the rights and privileges of the Co-Tenants under any such agreements;
(iii) with respect to the Affirmative Action Program Agreement (to
which reference is made in Section 5.19 hereof), to serve as the Operator (as
defined in the Affirmative Action Program Agreement) thereunder with respect to
the Property and to ensure
17
that all the terms, covenants and conditions thereof are observed, performed
and/or complied with, as the case may be;
(iv) with respect to the Leasehold Mortgages (other than the Existing
Leasehold Mortgages), the Indentures (other than the Existing Indentures) and
the Notes (other than the Existing Notes), to represent the Co-Tenants in all
dealings with any trustees, holders or mortgagees thereof (and any
successors-in-interest to such entities), as well as all other parties to said
documents or entities or persons having any connection, interaction or dealings
with the parties thereto and, further, to undertake all steps and procedures
which Managing Co-Tenant shall deem necessary or desirable to ensure that at
all times the Co-Tenants are in full compliance with all of the terms,
covenants and conditions of each of the Leasehold Mortgages, the Indentures,
and the Notes and to enforce all of the rights and privileges of the Co-Tenants
thereunder;
(v) with respect to contracts, agreements or any other arrangements
which one or more Co-Tenants may now have, or in the future may have, with any
entity or person respecting the construction, alteration, or repair of any
portion of the Property to represent the Co-Tenants with respect to all matters
concerning the same (except as otherwise provided herein), including, without
limitation, the enforcement of the Co-Tenants' rights and privileges
18
thereunder, and the objection to, negotiation and settlement of, all claims and
disputes arising therefrom;
(vi) with respect to any liens against the Leasehold, the Building,
and/or the Improvements which are not Permitted Exceptions (as such terms are
defined in the Superior Mortgage and the Subordinate Mortgage), take any
remedial measures; and
(vii) to contest and settle any real estate and commercial rent or
occupancy tax proceedings and assessments relating to the Property; provided,
however, that with respect to any such proceedings or assessments affecting or
arising out of a Co-Tenant's Space (including any such proceedings or
assessments relating to the Property as a whole), if Managing Co-Tenant shall
notify a Co-Tenant of its decision not to handle any such proceeding or
assessment (which notification Managing Co-Tenant shall endeavor to make as
early as reasonably practical so as to avoid prejudicing the rights of the
Co-Tenant of said Space), then said Co-Tenant shall have the right to contest
and settle same (it being understood that said Co-Tenant shall not permit or
allow such proceeding or assessment to become a lien upon the Property or any
portion thereof).
(b) With respect to the performance of its duties under this Agreement,
Managing Co-Tenant shall from time to time (but not less frequently than on a
quarterly basis) consult and meet with a soon to be formed advisory property
management committee (the "Management Committee") in order to be aware of the
needs and desires of the Co-
19
Tenants. The Management Committee shall act strictly in an advisory capacity
(until such time as the conditions set forth in Section 2.02(c) are met) and
shall have three (3) representatives designated by the Lehman Co-Tenants and
three (3) representatives designated by the AMEX Co-Tenants. Nothing in this
Paragraph (b) shall be construed in any way to reduce, limit or modify the
final decision-making authority of the Managing Co-Tenant with respect to the
operation and management of the Property. Notwithstanding anything to the
contrary contained herein, without the prior approval of the Non-Managing
Designated Co-Tenant, which approval shall not be unreasonably withheld or
delayed, Managing Co-Tenant shall not, except as required by the Lease, the
Project Operating Agreement, any Leasehold Mortgage or any Legal Requirements
(as hereinafter defined):
(i) make any expenditures or incur any obligation with respect to
which the Lehman Co-Tenants, if Amexco is the Managing Co-Tenant (or the AMEX
Co-Tenants, if Lehman is the Managing Co-Tenant) shall have any obligation to
pay for hereunder with respect to any capital improvement to the Property the
total cost of which, whether performed in one or several phases, exceeds
$6,000,000, adjusted annually to reflect any increases in the Consumer Price
Index (hereinafter defined);
(ii) perform or cause to be performed any act which (other than on a
temporary basis consistent with past practices and
20
procedures which shall include reasonable coordination with the Non-Managing
Designated Co-Tenant) materially and adversely affects the use or operation of
data processing or communications equipment or services of any of the
Co-Tenants in the Building (including, without limitation, the supply of
utilities and chilled or condenser water);
(iii) change the name of the Building, except as otherwise permitted
in Section 5.20.
(c) Notwithstanding anything to the contrary contained herein, (i) prior
to the satisfaction of the WFC Indebtedness, Amexco shall be the Managing
Co-Tenant and shall be permitted to assign its rights thereunder to any
Affiliate or assignee without the consent of any Co-Tenant; (ii) after the
satisfaction of the WFC Indebtedness, (q) if the aggregate Interests and
occupancy level of the AMEX Co-Tenant is 40% or greater, then the Amex
Co-Tenant shall be the Managing Co-Tenant and shall also have the right to
transfer its interest (or a portion thereof 40% or greater) as Managing
Co-Tenant to a single entity; (r) if either the aggregate Interest or the
occupancy level of the Amex Co-Tenant is less than 40% but greater than 25%, or
if the Amex Managing Co-Tenant has transferred its Interest (or a portion
thereof 40% or greater) to an assignee, then either the Amex Co-Tenant or such
assignee, as the case may be, shall serve as Co-Managing Co-Tenant and provided
a Lehman Co-Tenant's aggregate Interest and occupancy level is greater than 40%
21
than Lehman shall also serve as a Co-Managing Co-Tenant hereunder; (s) if
either the assignee of the Amex Co-Tenant's or the Lehman Co-Tenant's aggregate
Interests or occupancy levels falls below 25%, and the other Co-Tenant's
aggregate Interest and occupancy level remains above 25% then the Co-Managing
Co-Tenant falling below 25%, shall lose it's Co-Managing Co-Tenant status and
the other Co-Managing Co-Tenant shall become Managing Co-Tenant provided its
aggregate Interest and occupancy level remain above 25%; (t) if both the Amex
Co-Tenant and its assignee and the Lehman Co-Tenant and its assignee aggregate
Interest or occupancy level remain below 25% than both the Amex Co-Tenant and
the Lehman Co-Tenant shall be Co-Managing Co-Tenants; (u) provided a Lehman
Co-Tenant has an aggregate Interest and occupancy level above 40% than the
Lehman Co-Tenant shall also have the same right as set forth above in
sub-clause ( ) to assign to its assignee its rights as a Co-Managing
Co-Tenant; and (v) if either the Amex Co-Tenant or its assignee's or the
Lehman Co-Tenant's or its assignee's, as the case may be, aggregate Interest or
occupancy level falls below 25% and the other's Interest and occupancy level is
between 25% and 40%, then the Managing Co-Tenant whose Interest and occupancy
level that is between 25% and 40% shall become the Managing Co-Tenant.
If the Management Committee is deadlocked over the selection of the
Managing Co-Tenant or any direction to be given to the Managing Co-Tenant with
respect to the management of the
22
Property (except in the event of an emergency in which case the Managing
Co-Tenant shall act in a reasonable and prudent manner) or any other matter to
be determined by the Managing Co-Tenant pursuant to this Agreement, such
determination shall be jointly made by the respective Chief Financial Officers
of the Designated Co-Tenants. If the matter is still unresolved after ten (10)
days, then either Designated Co-Tenant shall have the right to submit the
matter to arbitration in accordance with Section 5.16 hereof. In the event
that at any time the party that is the Managing Co-Tenant files a voluntary
bankruptcy petition or has an involuntary bankruptcy petition the filed against
it, then the Non-Managing Designated Co-Tenant shall immediately upon such
filing become the Managing Co-Tenant.
(d) With respect to the Existing Leasehold Mortgages, the Existing
Indentures and the Existing Notes, Amexco shall represent the Co-Tenants in all
dealings with (i) any trustees, holders or mortgagees thereof (and any
successors-in-interest to such entities), (ii) any rating agencies (only with
respect to the rating of the Existing Notes), and (iii) all other parties to
said documents or entities or persons having any connection, interaction or
dealings with the parties thereto. Further, Amexco shall undertake all steps
and procedures which it shall deem necessary or desirable to ensure that at all
times the Co-Tenants are in full compliance with all of the terms, covenants
and conditions of each of the
23
Existing Leasehold Mortgages, the Existing Indentures, and the Existing Notes
and to enforce all of the rights and privileges of the Co-Tenants thereunder.
To the extent Amexco is required under the Existing Leasehold Mortgages or the
Existing Indentures, the Lehman Co-Tenants shall deliver any back-up
certificates or notices requested by Amexco at least three (3) business days
prior to the date such back-up certificates or notices are due.
2.03. PROPERTY OBLIGATIONS
(a) Each of the Co-Tenants shall be obligated, in accordance with the
terms of this Agreement, to bear and pay their proportionate share of all
Property Obligations (hereinafter defined). Except as hereinafter provided,
the AMEX Co-Tenants' and Lehman Co-Tenants' proportionate shares of Property
Obligations shall be equal to their respective Interests.
(b) The term "Property Obligations" shall mean all (i) Rental, (ii)
Common Area Charges (as such term is defined in the Project Operating
Agreement) [except for Utility Expenses (hereinafter defined) with respect to
the Co-Tenants' respective Spaces which are to be paid as set forth in Section
2.10 hereof], (iii) insurance premiums relating to the Property [except (A) for
premiums attributable solely to insurance on a Co-Tenant's installations and/or
improvements located within its Space or which relate to insurance obtained at
the request, and for the exclusive benefit, of a Co-Tenant, in each such case
the cost of which premiums shall be
24
borne solely by said Co-Tenant, (B) that the cost of insurance to each
Co-Tenant shall be equitably adjusted to reflect the loss experience of each
Co-Tenant if premiums fluctuate as a direct result of insured losses of one or
more Co-Tenants, and (C) that with the prior consent of the Managing Co-Tenant
a Co-Tenant may provide its equitable share of any insurance required under the
Lease and any Leasehold Mortgage], (iv) Utility Expenses with respect to those
portions of the Property other than the Spaces of the Co-Tenants, (v) costs and
expenses reasonably incurred and equitably determined by Managing Co-Tenant in
performing its duties hereunder, including, without limitation, bookkeeping,
accounting and legal fees and expenses (whether performed by independent
contractors or employees of Managing Co-Tenant), and (vi) all other costs and
expenses with respect to the shell, core and central systems of the Building
and the Common Facilities.
(c) Prior to the execution of this Agreement, various payments with
respect to Property Obligations, Debt Obligations (as hereinafter defined) and
Utility Expenses were made based upon estimated amounts. Accordingly, if and
to the extent the estimated payments made prior to the execution of this
Agreement by the Co-Tenants on account of Property Obligations, Debt
Obligations and Utility Expenses differ from the payments based on final
figures when available, there shall be appropriate adjustments, equitably
determined by the Managing Co-Tenant, and each Co-Tenant shall pay
25
its proper share of such adjustments (with interest to be applied at the
Federal funds rate).
2.04. COMMON FACILITIES
I. Common Facilities in General.
(a) The term "Common Facilities" (which term shall include those
Common Facilities designated on Exhibit C as "Special Common Facilities") shall
mean those areas of the Property (i) not included within the Space of any
Co-Tenant and (ii) intended by the Co-Tenants for the joint and common use of
each of the Co-Tenants. Certain of the areas of the Property constituting
Common Facilities as of the date hereof are indicated on Exhibit C annexed
hereto and made a part hereof.
(b) The Property Obligations for any Common Facility shall be
comprised of the applicable (i) Maintenance Costs (hereinafter defined), and
(ii) Usage Costs (hereinafter defined).
(c) The term "Maintenance Costs" shall mean those costs attributable
to the construction, installation, decoration, alteration, maintenance,
operation and repair of a Common Facility, but shall not include any Usage
Costs for that Common Facility. The Maintenance Cost for any Common Facility
shall be borne by each of the Co-Tenants in accordance with its respective
Interest, except as provided herein.
(d) The term "Usage Costs" shall mean those costs attributable to a
Co-Tenant's use of a Common Facility, or the use
26
thereof by a permitted subtenant or assignee of a Co-Tenant. The Usage Costs
for a Co-Tenant for any Common Facility shall be determined on the basis of any
of:
(i) the cost incurred as a result of actual usage by a Co-Tenant
(such Common Facilities being hereinafter referred to as "Cost-Based Common
Facilities");
(ii) the product of (A) the total Usage Costs for such Common
Facility and (B) the fraction, the numerator of which shall be equal to the
population of the Co-Tenant in the Building and the denominator of which shall
be equal to the total popula- tion of the Building; (such Common Facilities
being hereinafter referred to as "Population-Based Common Facilities");
(iii) the product of (A) the total Usage Costs for such Common
Facility and (B) the Interest of the Co-Tenant (such Common Facilities being
hereinafter referred to as "Interest-Based Common Facilities"); or
(iv) with respect to the Building's Retail space, cashiers and
credit union area, telecommunication facilities (the "Telecommunication
Facilities") and the television studio located at the +12.5 foot level of the
Building (the "T.V. Studio"), the Usage Costs shall be determined as provided
in Exhibit C hereof.
(e) From time to time, the Managing Co-Tenant shall reasonably and
equitably determine (i) the Maintenance Costs and Usage Costs for all Common
Facilities (other than the Usage Costs
27
for the T.V. Studio and the Telecommunication Facilities), and (ii) which
Common Facilities shall constitute Cost-Based Common Facilities,
Population-Based Common Facilities and Interest-Based Common Facilities. As of
the date hereof, the Cost-Based Common Facilities, Population-Based Common
Facilities and Interest-Based Common Facilities are as indicated on Exhibit C.
(f) Managing Co-Tenant shall have the right to segregate any Common
Facility in the Building, including, without limitation, mail services,
shipping and receiving facilities, elevators and utilities, such that one or
more Co-Tenants shall have the exclusive use of all or a portion of such
segregated facilities (the "Segregated Facilities"), provided that no Co-Tenant
shall be excluded from the benefit or use of any Segregated Facility unless and
until a suitable substitute for such facility is provided. Any Co-Tenant or
Co-Tenants benefitting from a Segregated Facility to the exclusion of any other
Co-Tenants shall bear an equitable portion of the Property Obligations in
respect thereof and with respect to any substitute therefor.
(g) The Managing Co-Tenant may, from time to time, upon not less than
twenty (20) days notice to the Non-Managing Designated Co-Tenant (the "Notice
Period"), convert a Common Facility (or portion thereof) to office space (a
"Proposed Converted Common Facility"), provided that the same is done in
compliance with all applicable laws and regulations, the terms and provisions
of the
28
Lease and any Leasehold Mortgages. The Proposed Converted Common Facility may
be occupied either by means of reallocation of Interests or by means of a
sublease executed by the Managing Co-Tenant on behalf of the Co-Tenants.
Notwithstanding the foregoing, the Non-Managing Designated Co-Tenant shall have
the right at any time prior to the expiration of the Notice Period to give
notice (the "Election Notice") to the Managing Co-Tenant pursuant to which the
Non-Managing Designated Co-Tenant agrees to assume for its own use, and, at its
option, the use of certain of the other Co-Tenants, the operation and cost of
the Proposed Converted Common Facility (in either its entirety or as reduced
pursuant to the terms below) including, without limitation, all Rental (as such
term is defined in the Lease), Maintenance Obligations and Utility Expenses
attributable to the Proposed Converted Common Facility as well as all costs and
expenses under all service provider and vendor contracts related thereto. In
the Election Notice, the Non- Managing Designated Co-Tenant shall also state
whether it desires to reduce the size of the Proposed Converted Common Facility
and, if so, the amount of space which it desires to reduce (the "Space
Reduction"). If the Non-Managing Designated Co-Tenant elects a Space
Reduction, then the Managing Co-Tenant, working together with the Non-Managing
Designated Co-Tenant, shall prepare or cause to be prepared plans and
specifications for the Space Reduction and arrange for the necessary work, all
of which
29
shall be at the sole cost and expense of the Non-Managing Designated Co-Tenant.
If Managing Co-Tenant, in its reasonable discretion, determines that the Space
Reduction cannot be accomplished, in whole or in part, then the Non-Managing
Designated Co- Tenant shall accept the Proposed Converted Common Facility in
its present or partially reduced size and with respect to the amount of space
that cannot be eliminated through the Space Reduction, the Non-Managing
Designated Co-Tenant shall not be required to pay the Rental with respect
thereto other than as a Co-Tenant hereunder. The Non-Managing Designated
Co-Tenant shall accept the proposed Converted Common Facility (together with
its trade fixtures and equipment in "as is" condition) and assume control and
operation of the Proposed Converted Common Facility on the date which is the
later of (i) sixty (60) days after giving the Election Notice, and (ii) ten
(10) days after Managing Co-Tenant completes the alterations referred to above.
In connection therewith, the Managing Co-Tenant shall work in close cooperation
with the Non-Managing Designated Co-Tenant to ensure a smooth and orderly
transition. Notwithstanding the foregoing, except as otherwise required by the
Lease, Project Operating Agreement, any Leasehold Mortgage or any Legal
Requirements, the Managing Co-Tenant shall not convert the lobby areas on the
street and mezzanine levels of the Building to office space if (i) such
conversion will materially reduce the fair market value of the Property, or
(ii) the size of the lobby area, as reduced, will
30
not be consistent with other first class office buildings in the New York City
area.
(h) Except as otherwise provided herein, Managing Co-Tenant shall (i)
make the Common Facilities available to all Co-Tenants on a reasonable and
equitable basis, and (ii) control all Building systems and utilities in order
to maintain the Building in the manner contemplated by this Agreement;
provided, however, that no assignee, transferee or subtenant of a Lehman Co-
Tenant shall have any right to the use or service of the Employee Assistance
Programs, the Fitness Center or the Medical Center (as such terms are defined
herein) but shall be entitled to use all other Common Facilities in accordance
with the terms hereof. Notwithstanding the foregoing, any assignee, transferee
or subtenant that is an Affiliate of a Lehman Co-Tenant shall have the right to
use all of the Common Facilities in accordance with the terms hereof.
II. Employee Assistance Programs.
(a) On and after the Distribution Date, Managing Co-Tenant shall
provide EAP Services to Lehman Co-Tenants' employees. The costs and expenses
of providing such EAP Services shall be determined and allocated on a
Pre-Distribution Basis in good faith by Managing Co-Tenant after consultation
with Lehman. AMEX Co-Tenants or Lehman Co-Tenants may at any time propose
changes to the EAP Services being provided.
31
(b) Notwithstanding Section (a) above, following the Distribution
Date, Managing Co-Tenant may make changes in the scope and level of EAP
Services it provides to Lehman Co-Tenants employees so long as any such change
is made on a Non-discriminatory Basis; provided, however, that (i) Managing
Co-Tenant shall notify Lehman in writing of any such proposed change which is
reasonably likely to materially adversely affect Lehman Co-Tenants' employees
(and its good faith estimate of the cost and expense implications thereof) at
least 90 days prior to such change being implemented and (ii) Managing
Co-Tenant shall continue to provide the then- existing level of the applicable
service (or such other level as the parties hereto may then agree) to Lehman
Co-Tenants employees if Lehman (A) so requests in writing and (B) agrees to pay
to Managing Co-Tenant an amount equal to all of Managing Co-Tenant's
incremental costs for providing such services. In the event that Managing
Co-Tenant proposes to cease providing all or substantially all EAP Services,
the rights granted to Lehman pursuant to clause (ii) above shall not be
available to Lehman Co- Tenants. Should Managing Co-Tenant propose to cease
providing all EAP Services, Lehman Co-Tenants shall have the option to (A)
occupy and use in connection with its provision of such services to Lehman
Co-Tenants' employees the Space Managing Co-Tenant theretofore occupied in
connection with Managing Co-Tenant's provision of such services, such Space
shall be treated as a Proposed Converted Common Facility pursuant to Section
32
2.04(I)(g), and (B) offer continued employment to the EAP Services staff,
without interference by Amexco, in connection with the provision by Lehman of
such services to Lehman Co-Tenants employees. Lehman shall offer to the Amex
Co-Tenants EAP Services on the same basis as made available to the Lehman
Co-Tenants.
(c) Lehman may, upon 180 days' written notice to Managing Co-Tenant,
request that Managing Co-Tenant provide to Lehman Co-Tenants' employees a
reduced level of EAP Services and following such 180 day notice period,
Managing Co-Tenant shall provide to Lehman Co-Tenants' employees such reduced
level of services and will adjust charges to Lehman if reduced services
decrease operating costs as reasonably determined by Managing Co-Tenant,
provided, however, that Lehman cannot provide such reduced level of EAP
Services within the Building.
(d) Lehman may, upon 180 days' written notice to Managing Co-Tenant,
request that Managing Co-Tenant cease providing any EAP Services to Lehman
Co-Tenants' employees and not later than the last day of such notice period
Managing Co-Tenant shall cease providing such services to Lehman Co-Tenants'
employees.
(e) Consistent with past practices, Managing Co-Tenant shall use its
reasonable efforts to provide to Lehman, at Lehman's request, information
regarding services provided by competitors which are similar to EAP Services.
If Lehman determines for reasons of cost to replace Managing Co-Tenant as its
EAP Services provider,
33
in whole or in part, Managing Co-Tenant shall have the right, for a period of
90 days following written notice by Lehman of its proposed change, to match the
level and cost of services to which Lehman proposes to change.
(f) Managing Co-Tenant shall prepare and deliver to Lehman, on or
prior to June 30 of each year, unless otherwise agreed to by both parties, a
proposed operating budget for EAP Services. Each such budget (other than the
budget for 1994) shall contain estimated staff bonuses as an item thereof.
Each operating budget, and any changes made thereto made during any budgeted
year, shall be prepared in good faith by Managing Co-Tenant, in consultation
with Lehman. Lehman shall give Managing Co-Tenant at least 180 days' prior
notice of any proposed change that is reasonably likely to materially increase
or decrease the number of employees needed to provide EAP Services.
(g) Lehman shall have the right to participate in and make
recommendations with respect to the performance appraisal process and
compensation review process, including bonus recommendations, for all EAP
Services staff and the right to participate in the hiring process for new
[exempt] staff. Lehman shall also have the right to review and approve all
written communications to Lehman Co-Tenants' employees concerning EAP Services.
(h) Managing Co-Tenant shall cause the EAP Services staff to, on
substantially the same basis as prior to the Distribution
34
Date, maintain in a reasonably confidential manner all records and files
relating to Lehman Co-Tenants' employees. Managing Co- Tenant shall cause to
be continually maintained, in a manner consistent with past practices and
procedures intended to ensure that any information relating to the businesses
or activities of Lehman Co-Tenants obtained from any Lehman Co-Tenants'
employee in connection with such employee's participation in EAP Services shall
not be disclosed to any representative of AMEX Co-Tenants or any other party
(other than EAP Services staff, or Medical Services staff on an as-needed
basis), except as required by law as may be interpreted in good faith by
Amexco.
(i) Notwithstanding the Managing Co-Tenant's obligation contained in
this Article II, Lehman hereby agrees and acknowledges that Managing Co-Tenant
may engage any third party to provide all or any EAP Services, subject to the
provisions of this Article II. Lehman shall have the right to participate in
and make recommendations prior to Managing Co-Tenant's engagement of a third
party.
(j) Notwithstanding anything to the contrary contained in (f), (g)
and (i) above, Managing Co-Tenant shall have the right to make any final
decisions with respect thereto, except with respect to the scope and level of
services provided to the Lehman Co- Tenants.
35
III. Fitness Centers.
(a) On and after the Distribution Date, Managing Co-Tenant shall
provide Fitness Center Services with respect to the fitness centers on the
fourth and forty-fourth floors of the Building (collectively, the "Fitness
Center") to AMEX Co-Tenants' and Lehman Co-Tenants' employees. The costs and
expenses of providing such Fitness Center Services shall be determined and
allocated on a Predistribution Basis in good faith by Managing Co-Tenant after
consultation with Lehman. Amexco or Lehman may at any time propose changes to
the Fitness Center Services being provided.
(b) Notwithstanding Section (a) above, following the Distribution
Date, Managing Co-Tenant may make changes in the scope and level of Fitness
Center Services it provides to Lehman Co-Tenants' employees so long as any such
change is made on a Non- discriminatory Basis; provided, however, that (i)
Managing Co-Tenant shall notify Lehman in writing of any such proposed change
which is reasonably likely to materially adversely affect Lehman Co-Tenants'
employees (and its good faith estimate of the cost and expense implications
thereof) at least 90 days prior to such change being implemented and (ii)
Managing Co-Tenant shall continue to provide the then-existing level of the
applicable service (or such other level as the parties hereto may then agree)
to Lehman Co-Tenants' employees if Lehman (A) so requests in writing
36
and (B) agrees to pay to Managing Co-Tenant an amount equal to all the
incremental costs incurred for providing such services. In the event that
Managing Co-Tenant proposes to cease providing all or substantially all Fitness
Center Services, the rights granted to Lehman pursuant to clause (ii) above
shall not be available to Lehman. Should Managing co-Tenant propose to cease
providing all Fitness Center Services, Lehman Co-Tenants shall have the option
to (A) occupy and use in connection with its provision of such services to
Lehman Co-Tenants' employees the Space Managing Co-Tenant theretofore occupied
in connection with Managing Co-Tenant's provision of such services, such Space
shall be treated as a Proposed Converted Common Facility pursuant to Section
2.04(I)(g), and (B) offer continued employment to the Fitness Center Services
staff, without interference by Amexco, in connection with the provision by
Lehman of such services to Lehman Co-Tenants' employees. Lehman shall offer to
the Amex Co-Tenants the Fitness Center services on the same basis as made
available to the Lehman Co-Tenants.
(c) Lehman may, upon 180 days' written notice to Managing Co-Tenant,
request that Managing Co-Tenant provide to Lehman Co-Tenants' employees a
reduced level of Fitness Center Services and following such 180 day notice
period, Managing Co-Tenant shall provide to Lehman Co-Tenants' employees such
reduced level of services and will adjust the charges to Lehman if such
37
reduced services decrease operating costs as reasonably determined by Managing
Co-Tenant, provided, however, that Lehman cannot provide such reduced Fitness
Center services within the Building.
(d) Lehman may, upon 180 days' written notice to Managing Co-Tenant,
request that Managing Co-Tenant cease providing any Fitness Center Services to
Lehman Co-Tenants' employees and not later than the last day of such notice
period Managing Co-Tenant shall cease providing such services to Lehman
Co-Tenants' employees.
(e) Consistent with past practices, Managing Co-Tenant shall use its
reasonable efforts to provide to Lehman, at Lehman's request, information
regarding services provided by competitors which are similar to Fitness Center
Services. If Lehman determines for reasons of cost to replace Managing
Co-Tenant as its EAP Services provider, in whole or in part, Managing Co-Tenant
shall have the right, for a period of 90 days following written notice by
Lehman of its proposed change, to match the level and cost of services to which
Lehman proposes to change.
(f) Managing Co-Tenant shall prepare and deliver to Lehman
Co-Tenants, on or prior to June 30 of each year unless otherwise agreed by both
parties, a proposed operating budget for Fitness Center Services. Each such
budget (other than the budget for 1994) shall contain estimated staff bonuses
as an item thereof. Each operating budget, and any changes made thereto during
38
any budgeted year, shall be prepared in good faith by Managing Co-Agent, in
consultation with Lehman. Lehman shall give Managing Co-Tenant at least 180
days prior notice of any proposed change that is reasonably likely to
materially increase or decrease the number of employees needed to provide
Fitness Center Services.
(g) Lehman shall have the right to participate in the performance
appraisal process and compensation review process, including bonus
recommendations, for all Fitness Center Services staff and the right to
participate in the hiring process for new [exempt] staff. Lehman shall also
have the right to review and approve all written communications to Lehman
Co-Tenants' employees concerning Fitness Center Services.
(h) Upon the Distribution Date, the fitness center on the fourth
floor will be renamed the "WFC Fitness Center".
(i) Six months after the Distribution Date (which period is subject
to reasonable extension to be mutually agreed upon by the parties), if Lehman
so chooses, it may expand the WFC Fitness Center to accommodate an additional
Three Hundred (300) Lehman Co- Tenants' members thereof. In connection
therewith, Lehman will pay the construction expense thereof and the expense of
the purchase of new equipment.
(j) After the Distribution Date, Managing Co-Tenant will replace all
the shirts (the "Shirts") currently used at the Fitness Center with two
thousand (2,000) new shirts reflecting the
39
new name "WFC Fitness Center". Managing Co-Tenant will also replace all the
forms (the "Forms") currently used at the Fitness Center to reflect the new
name (including enrollment forms, risk check forms, letterhead and envelopes,
and laminated clothing center cards). The 1994 WFC Health and Fitness Center
operating budget has been approved by Amexco and Lehman to include an
allocation covering 100% of the replacement costs of the Forms and 50% of the
replacement costs of the Shirts. Lehman will pay the remaining 50% of the
replacement costs of the Shirts.
(k) Managing Co-Tenant shall cause the Fitness Center Services staff
to, on substantially the same basis as prior to the Distribution Date, maintain
in a reasonably confidential manner all records and files relating to Lehman
Co-Tenants' employees.
(l) Lehman Co-Tenants shall be entitled to have 59% of the membership
of the WFC Fitness Center if and when the WFC Fitness Center expansion occurs
pursuant to paragraph (h). Until such expansion occurs, the membership shall
be populational based.
(m) Lehman shall have the right to participate in the performance
appraisal process and compensation review process, including bonus
recommendations, for all Fitness Center staff and the right to participate in
the hiring process for new [exempt] staff. Lehman shall also have the right to
review all written communications to members and potential members of the
Fitness Center.
40
(n) Upon request and at no additional cost, the Fitness Center
Services staff will provide advice and oversight to Lehman about the
establishment and operation of a fitness center, at 101 Hudson Street, Jersey
City, New Jersey, and/or other locations within New York/New Jersey
Metropolitan area (each an "Additional Fitness Center") and advise and consult
about the establishment and operation of a fitness center in locations
throughout the domestic United States.
(o) Upon request and on such terms and conditions, including
additional fees, as the parties may mutually agree, the Fitness Center Services
staff will supervise and manage the operation of one or more Additional Fitness
Centers.
(p) Lehman hereby agrees and acknowledges that in connection with
Managing Co-Tenant's obligations contained in this Article III, Managing
Co-Tenant may, consistent with past practice and procedures, at its sole
discretion, engage any third party to provide all or any Fitness Center
Services subject to the provisions of this Article III.
(q) Notwithstanding anything to the contrary contained in Section
2.04(III), Managing Co-Tenant shall have the right to make any final decisions
with respect thereto, except with respect to the scope and level of services
provided to the Lehman Co-Tenants.
41
IV. Medical Center.
(a) On and after the Distribution Date, Managing Co-Tenant shall
provide Medical Center Services in the medical center of the Building ("Medical
Center") to all AMEX Co-Tenants' and Lehman Co-Tenants' employees. The costs
and expenses of providing such Medical Center Services shall be determined and
allocated on a Pre-Distribution Basis. Amexco or Lehman may at any time
propose changes to the Medical Center Services being provided.
(b) Notwithstanding Section (a) above, following the Distribution
Date, Managing Co-Tenant may make changes in the scope and level of services it
provides to Lehman Co-Tenants' employees so long as any such change is made on
a Non-discriminatory Basis; provided, however, that (i) Managing Co-Tenant
shall notify Lehman in writing of any such proposed change which is reasonably
likely to materially adversely affect Lehman Co-Tenants' employees (and its
good faith estimate of the cost and expense implications thereof) at least 90
days prior to such change being implemented and (ii) Managing Co-Tenant shall
continue to provide the then- existing level of the applicable service (or such
other level as the parties hereto may then agree) to Lehman Co-Tenants'
employees if Lehman (A) so requests in writing and (B) agrees to pay to
Managing Co-Tenant an amount equal to all the incremental costs incurred for
providing such services. In the event that Managing Co-Tenant proposes to
cease providing all Medical Center
42
Services, the rights granted to Lehman pursuant to clause (ii) above shall not
be available to Lehman. Should Managing Co-Tenant propose to cease providing
all Medical Center Services, Lehman Co-Tenants shall have the option to (A)
occupy and use in connection with its provision of such services to Lehman
Co-Tenants's employees the Space Managing Co-Tenant theretofore occupied in
connection with Managing Co-Tenant's provision of such services, to the extent
such Space is reasonably divisible from Space occupied by AMEX Co-Tenants in
connection with functions unrelated to such services, such Space shall be
treated as a Proposed Converted Common Facility pursuant to Section 2.04(I)(g),
and (B) offer continued employment to the Medical Center Services staff,
without interference by Amexco, in connection with the provision by Lehman of
such services to Lehman Co-Tenants' employees. Lehman shall offer to the Amex
Co-Tenants the Medical Center Services on the same basis as made available to
the Lehman Co-Tenants.
(c) Lehman may, upon 180 days' written notice to Managing Co-Tenant,
request that Managing Co-Tenant provide to Lehman Co-Tenants' employees a
reduced level of Medical Center Services and following such 180 day notice
period, Managing Co-Tenant shall either provide to Lehman Co-Tenants' employees
such reduced level of services and will adjust charges to Lehman if reduced
services decrease operating costs as reasonably determined
43
by Managing Co-Tenant, provided, however, that Lehman cannot provide such
reduced Medical Services within the Building.
(d) Lehman may, upon 180 days' written notice to Managing Co-Tenant,
request that Managing Co-Tenant, cease providing any Medical Center Services to
Lehman Co-Tenants employees and not later than the last day of such notice
period Managing Co-Tenant shall cease providing such services to Lehman
Co-Tenants' employees.
(e) Consistent with past practices, Managing Co-Tenant shall use its
reasonable efforts to provide to Lehman, at Lehman's request, information
regarding services provided by competitors which are similar to Medical Center
Services. If Lehman determines for reasons of cost to replace Managing
Co-Tenant as its EAP Services provider, in whole or in part, Managing Co-Tenant
shall have the right, for a period of 90 days following written notice by
Lehman of its proposed change, to match the level and cost of services to which
Lehman proposes to change.
(f) Managing Co-Tenant shall prepare and deliver to Lehman
Co-Tenants, on or prior to June 30 of each year, a proposed operating budget
for Medical Center Services. Each such budget (other than the budget for 1994)
shall contain estimated staff bonuses as an item thereof. Each operating
budget, and any changes thereto during any budgeted year, shall be prepared in
good faith by Managing Co-Agent, in consultation with Lehman.
44
Lehman shall give Managing Co-Tenant at least 180 days prior notice of any
proposed change that is reasonably likely to materially increase or decrease
the number of employees needed to provide Medical Center Services.
(g) Lehman shall have the right to participate in the performance
appraisal process and compensation review process, including bonus
recommendations, for all Medical Center Services staff and the right to
participate in the hiring process for new [exempt] staff. Lehman shall also
have the right to review and approve all written communications to Lehman
Co-Tenants employees concerning Medical Center Services.
(h) Upon the Distribution Date, the Medical Center will be renamed
the "WFC Medical Department".
(i) Managing Co-Tenant shall cause the Medical Center Services staff
to, on substantially the same basis as prior to the Distribution Date, maintain
in a reasonably confidential manner all records and files relating to Lehman
Co-Tenants employees.
(j) Upon request and at no additional cost, the Medical Center
Services staff will provide advice and oversight to Lehman about the
establishment and operation of a medical center located within the New York/New
Jersey Metropolitan area (each an "Additional Medical Center") and shall
provide advice and consultation with respect to the establishment and operation
of medical centers to be located within the domestic United States.
45
(k) Lehman hereby agrees and acknowledges that in connection with
Managing Co-Tenant's obligations contained in this Article IV, Managing
Co-Tenant may, consistent with past practice, at its sole discretion, engage
any third party to provide all or any Medical Center Services subject to the
provisions of this Article IV.
(l) Notwithstanding anything herein to the contrary, Managing
Co-Tenant shall not be required to provide any Medical Center Services which
would subject the Managing Co-Tenant, in its good faith judgment, to an
unacceptable risk of [significant] liability.
V. Parking Facilities.
(a) The parking spaces located within the Building (except for the
P-3 parking spaces currently used for storage and the seven (7) spaces on P-4
and P-3 levels of the Building that are considered unusable for parking) shall
be considered to be Common Facilities and shall be allocated by the Managing
Co-Tenant in accordance with each Co-Tenant Interest. The cost of any parking
spaces allocated to a Co-Tenant shall be borne by such Co-Tenant as a
Cost-Based Common Facility. The cost of all other parking spaces shall be
borne by the Co-Tenants as an Interest-Based Common Facility.
(b) In the event that in the future (i) any of the parking spaces
currently located within the Building become
46
available, or (ii) the number of available parking spaces is decreased ,
Managing Co-Tenant shall allocate the available parking spaces among the
Co-Tenants, in accordance with each Co-Tenant's Interest, on a basis consistent
with that used immediately prior to the Distribution Date.
VI. Conference Center Services.
On and after the Distribution Date, Lehman shall have the right to use
the WFC Conference Center on the 26th Floor of the Building, the costs and
expenses of which use shall be determined and allocated on a Pre-Distribution
Basis. All conference rooms and the auditorium will, consistent with past
practice, be reserved and used on a first-come-first serve basis, except that
(i) two large conference rooms shall be permanently designated as Lehman rooms
and not be used by anyone other than Lehman without Lehman's prior consent and
(ii) two large conference rooms shall be permanently designated Amexco rooms
and not be used by anyone other than Amexco without Amexco's prior consent.
Any Co-Tenant may use the WFC Conference Center after normal business hours,
the costs and expenses of which use shall be reasonably determined by the
Managing Co-Tenant and borne exclusively by the Co-Tenant using the WFC
Conference Center during such period.
VII. Food Service.
On and after the Distribution Date, Lehman shall have the right to
continue using the contracted food services for the
47
Building, including the WFC Cafeteria, the WFC Trader Food Services, Marcellus
Berry, the 19th Floor Executive Food Services and the WFC Conference Catering
(but specifically excluding executive dining services on the 50th Floor of the
WFC) on the same basis as it was permitted to use such services and facilities
prior to the Distribution Date. Amexco and Lehman shall jointly review all
contracted food services on a quarterly basis, provided that Amexco shall have
the right to make all final decisions with respect to contracted food services
subject to the terms and conditions contained herein.
VIII. Lehman Library.
On and after the Distribution Date, Amexco employees shall have the
right to continue to use the Lehman Library located on the __ floor of the
Building on the same basis as was permitted immediately prior to the
Distribution Date. Notwithstanding the foregoing, upon 60 days notice, Lehman
shall retain the right to discontinue operation of the Lehman Library provided
such discontinuance is made on a non-discriminatory basis.
IX. Mail, Messengers and Delivery Services.
(a) On an after the Distribution Date, Amexco shall no longer provide
to Lehman at the WFC any package or courier acceptance or delivery services and
Amexco messengers will no longer be permitted on Lehman floors at the WFC
without permission. On an after the Distribution Date, Lehman shall have the
right to
48
establish and operate a Lehman messenger center in a designated portion of the
existing Amexco Messenger Center in the WFC Lobby and to establish and operate
a Lehman incoming delivery station at the WFC loading dock, each such location
as further described in Exhibit J hereto. On and after the Distribution Date,
all small packages delivered to Lehman by the United States Postal Service
shall be delivered via the internal conveyor system in the Building. At the
request of Lehman, Amexco shall provide courier services and for the acceptance
and delivery of packages at a cost to Lehman of Two Dollars and Sixty Cents
($2.60) per piece [subject to CPI Increase] for inbound delivery service [and
at its cost for outbound service.] Any adjustment to such prices must be
pre-approved by Amexco and Lehman.
(b) On and after the Distribution Date, Amexco shall provide Lehman
with outgoing domestic and international courier mail services at the WFC
substantially similar to those provided immediately prior to the Distribution
Date. Amexco will charge Lehman a handling charge for such courier services at
the rate of $2.35 per piece during 1994; thereafter such price may be adjusted
on an annual basis, the determination and allocation of costs and expenses
being made on Pre-Distribution Basis (unless otherwise determined by both
Amexco and Lehman). Lehman will continue to be responsible for all direct
courier mail charges. Amexco will use only couriers [for Lehman] which have
been pre-approved by Lehman.
49
Lehman has the right at any time on reasonable notice to Amexco to discontinue
using such Amexco outgoing courier mail service and to establish and operate
its own outgoing courier mail services at the Building either in the Space of
any Lehman Co-Tenant or in an area reasonably designated by Amexco (i.e., not
in the Space of any Amex Co-Tenant).
(c) On and after the Distribution Date, Lehman shall have a right to
establish and maintain a presence on the WFC loading dock (not to exceed one
Lehman employee), which in addition to providing any services referred to in
section (a) and (b) above, shall have the right to direct all incoming and
outgoing Lehman parcels, records and equipment.
(d) On and after the Distribution Date, Amexco will continue to sort
and distribute all incoming domestic and inter- national Lehman mail on the
same basis as immediately prior to the Distribution Date, except that it will
deliver research mail to Lehman three (3) times a day. The costs and expenses
of providing such services shall be determined and allocated on a Pre-
Distribution Basis. For the duration of 1994, Lehman shall pay to Amexco a fee
for such services in the annual amount of Two Hundred and Seventy Six Thousand
Dollars ($276,000) (to be billed at Twenty-Three Thousand Dollars ($23,000)
monthly). Any adjustments to such rate shall be pre-approved by Amexco and
Lehman and shall
50
reasonably account for substantial increases or decreases in volume of Lehman
Co-Tenants.
(e) On and after the Distribution Date, Amexco will continue to pick
up and deliver Lehman records to and from the warehouse in Piscataway, New
Jersey and to and from Lehman offices in New York City [and 101 Hudson] on the
same basis as immediately prior to the Distribution Date. The costs and
expenses of providing such services [is included in the Two Hundred and Seventy
Six Thousand Dollars ($276,000) referenced above]. Lehman may at any time on
reasonable notice to Amexco discontinue utilization of such services.
X. Communication Bins and Other Communications
on Shared Floors.
(a) On and after the Distribution Date, all of the Lehman and Amexco
discount flyers located in the front two lobby bins of WFC shall be available
to all Co-Tenants' employees. The bins shall be clearly identified as
containing the information of either Amexco or Lehman.
(b) On and after the Distribution Date, the present job posting
window and retail merchandise windows shall remain under the exclusive control
of Amexco.
(c) On and after the Distribution Date, Amexco shall continue to
maintain the posting of any required governmental communications in the windows
located on the third floor of WFC.
51
Upon request, Lehman shall have the use of such windows on an as needed basis
for the purpose of posting required notices.
(d) On and after the Distribution Date, both Amexco and Lehman shall
obtain the pre-approval of the other for the use of the employee cafeteria in
WFC for events to occur during the cafeteria's regular hours of operation,
including, without limitation, events where either Amexco or Lehman is a
co-sponsor.
(e) On and after the Distribution Date, both Amexco and Lehman shall
notify the other in advance of posting or distributing of any business
announcements including, without limitation, announcements with regard to new
clients, (i) in the public areas of WFC, (ii) in the lobby area of WFC, (iii)
at the bottom of escalators in WFC, or (iv) in any Common Facility. Should a
possible conflict of business interest exist, both Amexco and Lehman shall
obtain the pre-approval of the other in advance of such postings.
(f) On and after the Distribution Date, Amexco shall turn off all
television monitors on the floors occupied by Lehman Co-Tenants until Lehman
is able to determine whether each Lehman Co-Tenant can use the monitors for its
own communication messages.
(g) On and after the Distribution Date, Amexco and Lehman shall
advise each other in advance of, and assume coordinating responsibility of,
participating in the use of any area outside of the security turnstiles of the
Amexco lobby in WFC.
52
Should a possible conflict of business interest exist, Amexco and Lehman shall
obtain from the other pre-approval for such use.
(h) On and after the Distribution Date, the Co-Tenants shall
determine the costs for programming television monitors to broadcast programs
of Lehman and the "stock crawl" to floors occupied by Lehman Co-Tenants.
Should Amexco and Lehman mutually approve of such costs, they will subsequently
implement the broadcast of such programs.
2.05. DUTIES OF MANAGING CO-TENANT; CO-TENANT'S CHANGES
(a) Managing Co-Tenant shall, as agent for and at the expense of the
Co-Tenants and subject to and in accordance with the terms and provisions of
this Agreement, the Lease, the Project Operating Agreement, any Leasehold
Mortgages and the Affirmative Action Program Agreement, (i) make or cause to be
made all necessary or desirable repairs and improvements to the shell, core and
central systems of the Building and the Common Facilities, (ii) purchase needed
materials and supplies with respect thereto or otherwise in accordance with the
provisions of this Agreement, (iii) satisfy, in a timely manner, the Property
Obligations and the Debt Obligations (as hereinafter defined), and (iv) make
all other necessary and ordinary expenditures in connection with the operation,
repair, improvement and maintenance of the shell, core and central systems of
the Building and the Common Facilities, each as Managing Co-Tenant shall
reasonably deem advisable or
53
necessary in the performance of its duties hereunder. In performing its duties
under (i) above, the Managing Co-Tenant shall act in a reasonable and prudent
manner so as not to unduly disrupt the Co-Tenant's business.
(b) Managing Co-Tenant shall have the authority to hire, discharge
and supervise independent contractors and all operating, service and
maintenance personnel, service contractors, architects, space planners,
attorneys and other consultants engaged in furnishing services in the
performance of Managing Co-Tenant's duties hereunder.
(c) Upon obtaining knowledge thereof, each Co-Tenant shall promptly
notify Managing Co-Tenant of any violation, order, rule or determination of any
Federal, State or municipal authority affecting the Property. Managing
Co-Tenant shall diligently attempt to obtain, renew and extend as and when
necessary, all permits, licenses and other governmental authorizations
necessary to operate the Building and/or the Leasehold and any cost or expense
incurred in connection therewith shall be considered a Property Obligation,
except for the cost and expense of any such item required with respect to a
Co-Tenant's Space, which shall be borne by such Co-Tenant.
(d) (i) Each Co-Tenant may make any proposed alterations, repairs,
additions or improvements (collectively, "Co-Tenant's Changes") to its Space,
provided that any such Co-Tenant's
54
Changes are performed in compliance with the provisions of this Agreement.
Prior to the performance of any Co-Tenant's Change, the Co-Tenant in whose
Space the Co-Tenant's Change is proposed to be made shall deliver to Managing
Co-Tenant (1) the identity of the architect(s) and engineer(s) preparing plans
and specifications relating to such proposed Co-Tenant's Change, (2) complete
plans and specifications (including layout, architectural, mechanical and
structural drawings and specifications) relating to such proposed Co-Tenant's
Change, and (3) any additional information which may be required by the Lease
or any Leasehold Mortgage with respect to such proposed Co-Tenant's Change.
Upon receipt of the materials listed in (1) through (3) above, Managing
Co-Tenant shall with all reasonable diligence (but in no event later than ten
(10) days after receipt thereof) review such materials and advise the
submitting Co-Tenant of those additional materials, if any, which are required
for submission to the landlord under the Lease and/or the holders of any
Leasehold Mortgage, and/or, if applicable, any objections by any of the parties
required to give consent under clause (d)(ii) below. When all such materials
have been provided to Managing Co-Tenant, Managing Co-Tenant shall promptly
submit such materials to the landlord under the Lease and the holders of any
Leasehold Mortgage for any required consent to the performance of the proposed
Co-Tenant's Change. Thereafter, Managing Co-Tenant shall, using reasonable
commercial efforts,
55
pursue any such required consent and shall transmit to the submitting Co-Tenant
any requests or comments made by the landlord under the Lease or the holders of
any Leasehold Mortgage with respect to the proposed Co-Tenant's Change.
(ii) No Co-Tenant's Change shall be performed unless and until
the landlord under the Lease and the holders of any Leasehold Mortgages have
consented to the proposed Co-Tenant's Change, or Managing Co-Tenant has
determined that no such consent is required (which determination shall be
diligently made). All Co-Tenant's Changes:
(A) shall be made solely at the expense of the
Co-Tenant in whose Space said Co-Tenant's Change is proposed to be made;
(B) shall be performed in accordance with all laws,
orders and regulations of all state, federal, municipal and local governments,
departments, commissions and boards and all applicable requirements of
insurance bodies having jurisdiction over the Property (collectively, "Legal
Requirements") [and there shall be delivered to Managing Co-Tenant prior to the
performance of any work, if practical (or as soon thereafter as possible),
copies of any plans and specifications and applications made with respect to
any required building permits and copies of any building permits received with
respect to the proposed Co-Tenant's Change];
56
(C) shall not result in an adverse effect on the
basic structure of the Building or any Building systems (including without
limitation any of the Building's security systems), Utility Facilities
(hereinafter defined) or services to other Co-Tenants or other occupants of the
Property;
(D) shall be made in compliance with the practices
of Managing Co-Tenant then in effect regarding the use of unions and union
employees; and
(E) shall be made only if permitted under, and are
to be performed in accordance with, the provisions of the Lease, the
Affirmative Action Program Agreement and any Leasehold Mortgages.
(iii) All Co-Tenant's Changes shall be performed by and all
materials used in connection therewith supplied by contractors, subcontractors
and materialmen approved by the Managing Co-Tenant (collectively, the "Approved
Contractors"). If a Co-Tenant shall desire to have a Co-Tenant's Change
performed by a contractor or subcontractor, or have materials used in
connection therewith supplied by a materialman, which is not an Approved
Contractor, said Co-Tenant shall furnish the name thereof to Managing Co-Tenant
and Managing Co-Tenant shall issue its consent or disapproval of such
contractor, subcontractor and/or materialman within five (5) business days of
its receipt of request therefor.
57
(iv) All Co-Tenant's Changes are to be performed at such times
and in such a manner as to minimize interference with the use and enjoyment of
the Building by the other Co-Tenants. With reasonable diligence following the
completion of any Co-Tenant's Changes, the Co-Tenant in whose Space a
Co-Tenant's Change was made shall cause to be prepared and delivered to
Managing Co-Tenant, at said Co-Tenant's sole cost and expense, such "as-built
plans", equipment manuals, licenses and such other documents as may be required
under the Lease. Such Co-Tenant shall also pay the expenses of incorporating
such as-built plans into any electronic data base maintained by the Managing
Co-Tenant. Prior to the performance of any Co-Tenant's Changes, Managing
Co-Tenant may require from the Co-Tenant for whom the Co-Tenant's Change is
being made (a) waivers of liens (if then obtainable) from all contractors,
subcontractors and materialmen performing work or supplying materials in
connection with such Co-Tenant's Changes and (b) evidence that all such
contractors, subcontractors and materialmen will be paid in full, which
evidence may include, without limitation, payment and performance bonds.
(e) The quantity and quality of services which Managing Co-Tenant
shall provide hereunder to the Co-Tenants shall be of the quantity and quality
which Managing Co-Tenant shall deem necessary or appropriate for the
maintenance of the Property reasonably consistent with current levels and
practices as of the
58
date hereof. If at any time a Co-Tenant should determine that it needs or
requires services (other than utility services) which are in excess of the
quantity and/or quality of services then being supplied to it by Managing
Co-Tenant (the "Additional Services"), the Co-Tenant shall request such
Additional Services from Managing Co-Tenant only, and, if reasonably
practicable, Managing Co-Tenant shall cause such Additional Services to be
furnished to the Co-Tenant, at that Co-Tenant's sole cost and expense. With
respect to utility services, the Co-Tenants acknowledge that the Lehman
Co-Tenants presently utilize a percentage of the base building infrastructure
capacity which is greater than their aggregate Interests. The Co-Tenants
hereby consent to the usage levels existing as of the date hereof for the
Lehman Co-Tenants so long as, and to the extent, Lehman's trading floor and
electronic data processing operations as presently constituted continue.
However, if at any time, such trading floor or electronic data processing
operations shall be discontinued or curtailed then said usage levels shall be
adjusted accordingly. Further, if the Lehman Co-Tenants or the AMEX
Co-Tenants, as the case may be, (each, a "Requesting Co-Tenant") should
determine that they need or require additional base building infrastructure
capacity (for example, additional kilowatt hours or tonnage of chilled water)
in excess of that being furnished or made available to them as of the date
hereof ("Additional Capacity"), the Requesting Co-Tenant shall
59
request in writing such Additional Capacity from the Managing Co-Tenant. The
Managing Co-Tenant shall cause such Additional Capacity to be furnished or made
available to the Requesting Co-Tenant, at its sole cost and expense, if (i)
reasonably practicable in the opinion of the Managing Co-Tenant, and (ii) the
amount of the Additional Capacity does not exceed the Requesting Co-Tenant's
"fair share" (as measured by their then aggregate Interest) of the available
system capacity as measured from the date hereof.
(f) Managing Co-Tenant shall have no liability to the other
Co-Tenants by reason of any inconvenience, annoyance, interruption or injury to
business arising from Managing Co-Tenant's making any repairs or changes which
Managing Co-Tenant is required or permitted by this Agreement, or required by
law, to make in or to any portion of the Property or in or to the fixtures,
equipment or appurtenances of the Property. Further, Managing Co-Tenant
reserves the right, without any liability to Tenant, to stop service of any of
the heating, ventilating, air conditioning, electric, sanitary, elevator or
other primary or secondary systems serving the Property, or the rendition of
any of the other services required of Managing Co-Tenant under this Agreement,
whenever and for so long as may be necessary, by reason of accidents,
emergencies, strikes or the making of repairs or
60
changes which Managing Co-Tenant is required or permitted to make pursuant to
this Agreement.
2.06. CONTRACTS
Subject to and in accordance with the provisions of this Agreement,
Managing Co-Tenant is authorized in the name and at the expense of the
Co-Tenants, to make contracts for electricity, gas, steam, telephone, cleaning
services, vermin extermination, and other materials, supplies and services as
Managing Co-Tenant shall reasonably deem advisable. Managing Co-Tenant shall
not be required to obtain competitive bids for any such contracts.
2.07. MANAGEMENT COMPANY; CHANGE OF MANAGING CO-TENANT
Managing Co-Tenant may at any time retain any reputable management
company to perform all or a portion of the responsibilities and obligations
of Managing Co-Tenant under this Agreement, and the fees and expenses paid to
such management company shall be considered a Property Obligation.
2.08. BUILDING SECURITY; SECURE AREAS
(a) Managing Co-Tenant shall provide such security services and
security systems for the Building as it shall deem necessary and/or desirable,
subject to any restrictions set forth in the Lease or the Project Operating
Agreement (the "Security Services"). The Security Services shall include,
without limitation, (i) placing security personnel at the lobby entrances and
parking garage of the Building and the Building's lobby elevator
61
and stairway entrances and (ii) having security personnel patrol the public
areas, elevators and stairways of the Building; in each case 24 hours a day,
365 days a year.
(b) (i) Each Co-Tenant shall be permitted to install security systems
and security devices other than those furnished as part of the Security
Services (the "Additional Security Services"), provided that (A) Managing
Co-Tenant shall have determined to consent to the installation and/or provision
of such Additional Security Services, which determination managing Co-Tenant
shall make in good faith, (B) the Co-Tenant in whose Space such Additional
Security Services will be provided shall bear the sole cost of the
installation, maintenance and repair of the same, as well as any increase in
costs of the provision of Security Services to the other Co-Tenants resulting
from the provision of Additional Security Services to the requesting Co-Tenant,
and (C) the Additional Security Services shall not violate any laws, orders or
regulations or any provision contained in the Lease or the Project Operating
Agreement.
(c) Each Co-Tenant shall use its best efforts to preserve the
security and safety of other occupants of the Building and in the event
Managing Co-Tenant receives any complaints from other tenants or occupants at
the Building with respect to breaches of security or safety arising out of, or
any nuisance with respect to the conduct of a Co-Tenant's employees, agents,
con-
62
tractors or invitees, said Co-Tenant shall immediately take whatever measures
as shall be reasonably necessary or as Managing Co-Tenant shall reasonably
direct to remedy any such complaint. No Co-Tenant shall perform any action
(including installation of electronic equipment) which may adversely affect the
Building's security systems.
(d) (i) Each Co-Tenant may, fifteen (15) days after having given
notice to Managing Co-Tenant (or sooner, in the event of compelling business
reasons) designate and establish certain discrete enclosed portions of its
Space, as to which it has strict security requirements (the "Secure Areas").
Additionally, those portions of the Building as to which Co-Tenants have strict
security requirements as of the date hereof shall constitute Secure Areas, and
are identified on Exhibit F annexed hereto and made a part hereof.
(ii) Managing Co-Tenant shall have such access to any Secure Area
as may reasonably be required to perform its obligations hereunder, to assure
compliance with the Lease or the Leasehold Mortgages, or to maintain, repair,
install or otherwise service, or to gain access to, any Utility Facility,
Common Facility or Building system, provided that Managing Co-Tenant shall be
accompanied by a representative of the Co-Tenant in whose Space the Secure Area
is located and in compliance with such other reasonable restrictions as said
Co-Tenant may establish.
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(iii) Unless Managing Co-Tenant shall have such access as it
reasonably deems necessary to secure, maintain or operate any Secure Area,
Managing Co-Tenant shall have no obligations, responsibilities or liability
with respect to the security, maintenance or operation thereof and the
Co-Tenant in whose Space a Secure Area is located shall provide all such
services with respect thereto in accordance with the provisions of this
Agreement and consistent with the level of such services then being provided to
the balance of Space. The Co-Tenant in whose Space a Secure Area is located
shall have the option of permitting Managing Co-Tenant to have access to said
Secure Area in order to furnish cleaning, security, maintenance and other
services with respect thereto. If there shall be any additional expenses in
furnishing such services to any Secure Area, the Co-Tenant in whose Space the
same is located shall bear said additional expenses.
2.09. DEBT OBLIGATIONS
(a) Each of the Co-Tenants shall be obligated, in accordance with the
terms of this Agreement, to bear and pay its portion of the Debt Obligations.
(b) As of the Transfer Date, the outstanding principal amount of the
Debt Obligations owed by the Lehman Co-Tenants is $______ and the amount of the
Debt Obligations owed by the Amex Co-Tenants is $______, which amounts may be
adjusted from time to
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time by way of payments or accretions or as otherwise agreed to by the parties
without regard to any stated percentages contained in any Leasehold Mortgages,
Notes or other documents, and without regard to any Co-Tenant's Interest.
Furthermore, each of the Co- Tenants hereby affirmatively represents that it
shall promptly pay their portion of the Debt Obligations.
(c) The term "Debt Obligations" shall mean the total aggregate amount
of outstanding principal balance and accrued and unpaid interest due at any
time under the Indentures and Notes.
2.10. UTILITIES; UTILITY EXPENSES; UTILITY FACILITIES
(a) Each Co-Tenant shall bear and timely pay the cost of all
electricity, gas, water, steam, chilled and condensed water and all other
utilities (the "Utility Expenses") servicing its Space. Utility Expenses shall
be equitably apportioned among the Co-Tenants by Managing Co-Tenant, until such
time, if ever, as submeters are installed, following which the submeters shall
govern. The cost of all submeters installed with respect to Utility Expenses
shall be considered Property Obligations hereunder.
(b) Each of the Spaces shall be benefitted and burdened by certain
non-exclusive easements in favor of the Managing Co-Tenant for the
construction, installation, operation, maintenance, repair, restoration and
replacement of certain lines, conduits, pipes, ducts, vents, tanks, equipment,
machinery, convey-
65
ors, dumb-waiters, and connections for utilities, HVAC and other systems in the
Building, and the closets and other areas housing or containing each of the
foregoing, to the extent the same serve a Space or Spaces other than the Space
in which they are located (collectively, the "Utility Facilities"). Each
Co-Tenant hereby agrees to use all reasonable efforts not to permit any
interference with or damage to the Utility Facilities within its Space.
(c) Each Utility Facility shall be constructed, installed, operated,
maintained, repaired, restored, replaced and insured by Managing Co-Tenant,
with the cost of each of the foregoing constituting a "Utility Facility
Expense."
(d) The Utility Facility Expense for each Utility Facility shall be
borne as follows:
(i) with respect to any Utility Facility which serves only one
Space (the "Benefitted Space") but is located in another Space (the "Burdened
Space"), the Co-Tenant of the Benefitted Space shall reimburse the Co-Tenant of
the Burdened Space within ten (10) days after demand therefor for the Utility
Facility Expenses incurred by the Co-Tenant of the Burdened Space during the
period covered by such demand;
(ii) with respect to any Utility Facility which serves more than
one Space, the Co-Tenants of the Spaces which are served shall bear the Utility
Facility Expense in accordance with an equitable apportionment made by the
Managing Co-Tenant.
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(e) The Co-Tenant of any Burdened Space shall utilize its reasonable
commercial efforts to prevent the Utility Facility therein from being
interfered or tampered with, or affected, in any manner whatsoever (except by
Managing Co-Tenant or its agents or contractors).
2.11. USE OF SPACE
(a) Each Co-Tenant may use its Space for any lawful purpose in
accordance with the provisions of this Agreement, the Certificate of Occupancy
for such Space, the Lease and any Leasehold Mortgages; provided, however, that
no Co-Tenant shall at any time be permitted to change, or permit the change of,
the then current particular use of its Space without the prior written consent
of the Managing Co-Tenant if such use would increase the burden on the Building
systems and/or the Utility Facilities, except that without any such consent a
Co-Tenant may change the particular use of its Space to (i) a use already in
effect in the Building or (ii) other uses required for the business of
Co-Tenant provided the character of the Building is not in any manner
diminished, in each such case in accordance with the Certificate of Occupancy
for such Space.
(b) Each Co-Tenant shall maintain its Space in a manner consistent
with a New York City first-class headquarters office building and in accordance
with the rules and regulations to which reference is made in Section 5.22.
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(c) A Co-Tenant may leave all or any material portion of its Space
unoccupied for a period not to exceed eighteen (18) months upon satisfaction of
the following conditions:
(i) such Co-Tenant shall give written notice to the Managing
Co-Tenant before leaving the Space unoccupied, and
(ii) such Co-Tenant shall in all respects comply with the
provisions of this Agreement, the Lease and any Leasehold Mortgages with
respect to such Space.
2.12. TELECOMMUNICATION FACILITIES AND T.V. STUDIO
With respect to the Telecommunication Facilities, Lehman, and with
respect to the T.V. Studio, TRSCO, shall: (a) manage and supervise its
operation and (b) make it available to all Co-Tenants on a reasonably equitable
basis. The Usage Costs of the Telecommunication Facilities and T.V. Studio
shall be determined in accordance with the provisions of Exhibit C annexed
hereto.
ARTICLE III
FINANCIAL MATTERS
3.01. BUDGETS
(a) (i) Managing Co-Tenant shall prepare, for planning and
informational purposes only, a proposed annual budget ("Budget") for the
Property for each calendar year during the term of this Agreement and shall
deliver such proposed Budget to each of the Co-Tenants not later than sixty
(60) days prior to the begin-
68
ning of the calendar year to which such Budget relates. Such proposed Budget
shall contain those expenditure categories set forth on Exhibit G or otherwise
as Managing Co-Tenant may reasonably adopt (the "Budget Categories"). Each
proposed Budget Category shall show in reasonable detail the estimated costs of
operating the Building for the following calendar year, but shall not include
capital expenditures, Rental under the Lease, Debt Obligations and Common Area
Expenses under the Project Operating Agreement.
(ii) The Managing Co-Tenant shall have the authority to modify,
amend and/or supplement a Budget, a Budget Category or a Capital Budget
(hereinafter defined).
(iii) Managing Co-Tenant shall prepare, for planning and
informational purposes only, a separate proposed annual budget for capital
expenditures for the Property ("Capital Budget") for each calendar year during
the term of this Agreement and shall deliver the same to each of the Co-Tenants
simultaneously with delivery of the proposed Budget for each such calendar
year. Such Capital Budget shall describe in reasonable detail those capital
expenditures scheduled for the immediately following calendar year and the
estimated cost thereof.
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3.02. PAYMENT OF UTILITY EXPENSES AND PROPERTY OBLIGATIONS
(a) (i) The Managing Co-Tenant shall advance funds on behalf of each
of the Co-Tenants in order to timely satisfy the Utility Expenses and Property
Obligations.
(ii) The Co-Tenants each promise to timely reimburse to managing
Co-Tenant their respective Utility Expenses, Interests of all Property
Obligations and any Interest Component (hereinafter defined) due in connection
with either of the foregoing, each in accordance with the provisions of this
Section 3.02.
(b) (i) The term "Interest Component" shall mean the amount of
interest, whether computed at the Cost Rate (hereinafter defined), Investment
Rate (hereinafter defined), Penalty Rate (hereinafter defined) or any other
rate agreed upon between Managing Co-Tenant and a Co-Tenant, which accrues
hereunder with respect to any Utility Expense or Property Obligation.
(ii) The term "Cost Rate" for any particular period (currently
determined on a calendar month basis) shall mean the interest rate equal to
Managing Co-Tenant's average short term cost of funds for such period, as
determined by Managing Co-Tenant.
(iii) The term "Investment Rate" for any particular period
(currently determined on a calendar month basis) shall mean
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the interest rate equal to (A) the average return on Managing Co-Tenant's short
term investments for such period, as determined by Managing Co-Tenant, or (B)
if no such short term investments for such period are then being made, Managing
Co-Tenant's average short term cost of funds for such period, as determined by
Managing Co-Tenant.
(iv) The term "Penalty Rate" shall mean the lesser of (A) the
interest rate equal to 200 basis points in excess of the annual prime rate
charged by Morgan Guaranty Bank, as in effect from time to time, or (B) the
maximum rate then permitted by law.
(v) The term "payment" shall refer to the delivery of good funds,
unless otherwise indicated.
(c) (i) If, during any particular month or quarter (as the case may
be), Managing Co-Tenant shall have engaged in any short term borrowing, the
amount of any funds of Managing Co-Tenant used to satisfy the Utility Expenses
and/or Property Obligations accruing during such month or quarter (as the case
may be) shall bear interest from the date such funds were used to satisfy such
Utility Expenses and/or Property Obligations to the earlier of the date of
payment or the Due Date (as herein defined), at the greater of (A) the Cost
Rate, or (B) the Investment Rate for such period, as computed from time to
time.
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(ii) If, during any particular month or quarter (as the case may
be), Managing Co-Tenant shall not have engaged in any short term borrowing, the
amount of any funds of Managing Co-Tenant used to satisfy the Utility Expertise
and/or Property Obligations accruing during such month or quarter (as the case
may be) shall bear interest from the date such funds were used to satisfy such
Utility Expenses and/or Property Obligations to the Due Date, at the Investment
Rate for such period, as computed from time to time.
(d) The Managing Co-Tenant shall prepare or cause to be prepared, and
shall submit to each Co-Tenant,
(i) statements (each, a "Property Obligation and Utility Expense
Statement") within fifteen (15) days after the end of each month (or as soon as
possible thereafter) setting forth the particular Co-Tenant's respective (A)
Utility Expenses, (B) Interest of the Property Obligations incurred by the
Managing Co-Tenant during the preceding month, and (C) Interest on any accrued
but unpaid Interest Component; and
(ii) statements (each, a "Capital Property Obligation Statement")
on each April 15, July 15, November 15 and February 15 (or as soon as possible
after each such date) setting forth the particular Co-Tenant's respective
Interest of the (A) Property Obligations with respect to capital expenditures
("Capital Property Obligations") and which are incurred by the Managing
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Co-Tenant during, respectively, the first, second and third quarters of the
then current calendar year, and with respect to the February 15 statement, the
fourth quarter of the immediately preceding calendar year, and (B) any accrued
but unpaid Interest Component. With respect to specific and identifiable
Capital Property Obligations which are in excess of $1,000,000, Managing
Co-Tenant shall, where reasonably practical, issue in advance Capital Property
Obligation Statements with respect thereto setting forth the date by which
payment thereof is required.
(e) A Co-Tenant shall pay Managing Co-Tenant the amounts indicated on
its respective Property Obligation and Utility Expense Statement and Capital
Property Obligation Statement by the end of the thirtieth (30th) day following
Co-Tenant's receipt thereof (the "Due Date"). Any payment by a Co-Tenant in
full or partial satisfaction of its Utilities Expenses, Interest of Property
Obligations or its Capital Property Obligations shall be applied first to
payment of principal and then to interest. If a Co-Tenant shall at any time
fail to pay the full amount of its Utility Expenses (and any Interest Component
due in connection therewith) or its respective Interest of any Property
Obligation (or any Interest Component due in connection with either of the
foregoing) by the applicable Due Date, the unpaid portion of any such amount
shall bear interest at the Penalty Rate from the Due Date until fully paid.
Notwithstanding anything to the contrary
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which may be contained in this Agreement, the portion of any Interest Component
computed at the Penalty Rate shall be the sole property of Managing Co-Tenant.
(f) At any time after the end of each month, Managing Co-Tenant shall
be permitted to pay itself, on behalf of the other Co-Tenants, either by
borrowing funds or out of such funds of the Co-Tenants (as Co-Tenants only) as
it may then be in possession of, any accrued but unpaid Interest Component
relating to any Property Obligation or Capital Obligation incurred by Managing
Co-Tenant during the previous month.
(g) If, subsequent to the payment by a Co-Tenant to Managing
Co-Tenant of any Utility Expense or Property Obligation (and Interest Component
on either of the foregoing), Managing Co-Tenant determines that there has been
(i) an overpayment of any such amounts by said CoTenant (an
"Overpayment"), Managing Co-Tenant shall, within thirty (30) days after such
determination has been reached, pay to said Co-Tenant (A) the amount of said
Overpayment, including the portion of-any Interest Component paid to Managing
Co-Tenant and attributable to said Overpayment, and (B) interest on the
Overpayment, computed (1) at the rate, from time to time, then in effect for
the period from the date of payment of the Overpayment by Co-Tenant to the end
of the thirty (30) day period described above, and, if payment shall not have
been made by the end of such
74
period, thereafter, at the Penalty Rate until payment shall be made; or
(ii) an underpayment of any such amounts by said Co-Tenant (an
"Underpayment"), Co-Tenant shall, within thirty (30) days following notice
thereof from Managing Co-Tenant, pay the amount of such Underpayment, including
any Interest Component due in connection therewith computed at the rate, from
time to time, then in effect for the period from the date such Underpayment
should have been paid to the end of the thirty (30) day period referred to
above, and, if payment shall not have been made by the end of such period,
thereafter, at the Penalty Rate until payment shall be made.
(h) All Co-Tenants agree to work together to promptly determine
whether there has been any overpayment or underpayment with respect to Utility
Expenses or Property Obligations. Each Co-Tenant's obligation hereunder to pay
any Property Obligations, Utility Expenses or Interest Component as herein
provided shall not in any manner be affected by the failure of the Managing Co-
Tenant to prepare or deliver to any Co-Tenant any Property Obligation and
Utility Expense Statement or Capital Property Obligation Statement.
(i) Nothing herein contained shall prevent the Managing Co-Tenant
from adjusting the length of the monthly and quarterly periods used in
administering the Property Obligations
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for purposes of facilitating the billing and collection of such amounts.
3.03. PAYMENT OF DEBT OBLIGATIONS
(a) The Managing Co-Tenant shall prepare or cause to be prepared, and
shall submit, periodic statements (each, a "Debt Obligation Statement") to the
other Co-Tenants not less than fifteen (15) days prior to the date a Debt
Obligation is due (or as soon thereafter as possible), setting forth the Debt
Obligations due for the next succeeding month. Each Co-Tenant shall furnish
Managing Co-Tenant with a check drawn on a bank which is a member of the New
York Clearing House Association (or any other means by which good funds are
available by 12:00 o'clock noon on the subsequent business day) in the amount
of its respective Debt Percentage of the Debt Obligations set forth in said
Debt Obligation Statement no later than 12:00 o'clock noon on the business day
preceding the day which Managing Co-Tenant reasonably determined to be the date
such Debt Obligations must be paid. Each Co-Tenant's obligation hereunder to
pay any Debt Obligations as herein provided shall not in any manner be affected
by the failure of Managing Co-Tenant to prepare or deliver to any Co-Tenant any
Debt Obligation Statement.
(b) It is the intention of the parties hereto that at no time prior
to, during or after the term of this Agreement, shall Managing Co-Tenant be
required to satisfy from its own funds
76
any of the Debt Obligations (other than Managing Co-Tenant's Debt Percentage
thereof).
3.04. FUNDS OF CO-TENANTS
(a) All monies received by Managing Co-Tenant for or on behalf of the
Co-Tenants, other than those monies received by Managing Co-Tenant and intended
as payment or prepayment to Managing Co-Tenant, may be commingled with other
funds of Managing Co-Tenant but shall be held in trust by Managing Co-Tenant
for the Co-Tenants. Managing Co-Tenant shall have the right to sign checks on
behalf of the Co-Tenants for any amounts which the Co-Tenants may be obligated
to pay either herein or under the Lease, Project Operating Agreement or any
Leasehold Mortgages, without the prior consent of the Co-Tenants. Such monies
may be invested by Managing Co-Tenant in Managing Co-Tenant's discretion, in
any of (i) the investments contained in Amexco's short term investment list
approved by the Finance Committee of the Board of Directors of Amexco, (ii) any
investment-grade short term security or (iii) in so-called "money market
funds". Managing Co-Tenant shall have no responsibility for failing to select
the investment which would have provided the maximum rate of return on the
monies of the Co-Tenants or for the solvency of the issuer or depository
selected in accordance with the foregoing provisions. Except as otherwise
provided herein, any interest earned on such deposits shall
77
remain the property of the Co-Tenants, in accordance with their respective
Interests.
(b) Managing Co-Tenant shall have the right without the consent of
any other Co-Tenant to sign all checks on behalf of the Co-Tenants for any
expenditures incurred in accordance with the provisions of this Agreement.
3.05. EXCESS FUNDS
(a) If at any time Managing Co-Tenant shall have collected funds from
or on behalf of a Co-Tenant in excess of said Co-Tenant's Interest of its then
due and owing installment of Property Obligations, such excess funds shall (i)
earn interest for the account of said Co-Tenant at the rate, from time to time,
in effect during the period commencing on the date of Managing Co-Tenant's
retention of such excess funds through the Managing Co-Tenant's disposition of
said excess funds and (ii) said excess funds and the interest earned thereon
(collectively, the "Excess Funds") shall be:
(A) retained by Managing Co-Tenant, if agreed to by
said Co-Tenant, and thereafter applied against said Co-Tenant's next accruing
installments of Property Obligations; or
(B) returned to said Co-Tenant upon either (1) the
decision of Managing Co-Tenant to return the same or (2) within five (5) days
after demand therefor by Co-Tenant (and, if said Excess Funds are not paid on
the end of the fifth day of said
78
period, such Excess Funds shall accrue interest at the Penalty Rate until the
same are paid to Co-Tenant).
(b) Any income to the Co-Tenants arising from the Common Facilities
shall be collected, retained and applied in accordance with the Co-Tenants'
Interests by Managing Co-Tenant to satisfy any Property Obligations accruing
hereunder, and any sums remaining shall be distributed to the Co-Tenants in
accordance with the Co-Tenants' Interests.
3.06. PERIODIC STATEMENTS
Managing Co-Tenant shall use reasonable efforts to deliver to the
Co-Tenants within fifteen (15) days after the end of each month (or as soon as
possible thereafter), (i) an unaudited report of income and expense of the
Property for such next previous month prepared on a cash disbursement basis
(including a statement of funds, if any, held by it as provided in Section 3.04
hereof), (ii) an unaudited report of income and expense prepared on an accrual
basis, compared on a monthly and year-to-date basis to the Budget and (iii) an
unaudited report reflecting the then current status of the Debt Obligations.
In addition, after the close of each calendar year, Managing Co-Tenant shall
cause to be prepared by its independent public accountants and delivered to the
Co-Tenants audited annual financial statements (required by the Lease) as well
as all relevant income tax reporting information. The fees of such independent
public accountants and all
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other costs incurred in connection with the preparation and delivery of such
statements shall be considered Property Obligations.
3.07. BOOKS AND RECORDS
Managing Co-Tenant shall maintain and keep available, at its offices,
at all times, such complete and up-to-date books and records of the operation
of the Property as are customarily maintained by managing agents, or as
reasonably required by the Co-Tenants, including paid bills and vouchers as
well as leases, lease amendments and contracts relating to the Property. The
CoTenants and their respective partners, directors, agents and designees
reasonably acceptable to the Managing Co-Tenant shall, at all reasonable hours,
have a right to audit and examine said books, records, leases, lease amendments
and contracts relating to the Property and to make transcripts or photostats of
all or any part thereof. The books of account relating to the operation of the
Property shall be the property of the Co-Tenants; however all records relating
thereto shall be the property of Managing Co-Tenant, but copies thereof shall
at reasonable times be available to the Co-Tenants.
3.08. FINAL ACCOUNTING
Upon termination of this Agreement or upon the substitution of a new
Managing Co-Tenant, Managing Co-Tenant shall promptly render a final accounting
of receipts and disbursements
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to the Co-Tenants for any period for which an accounting has not theretofore
been submitted, all accounts shall be closed and the Managing Co-Tenant shall
transfer to such parties all funds being held by the Managing Co-Tenant to
which such parties are entitled. In addition the books of account maintained
by the Managing Co-Tenant for the Property together with copies of the relevant
Property records shall be delivered to the Managing Co-Tenant.
3.09. FAILURE TO PAY
(a) If any Co-Tenant shall fail to pay when due any installment of
Property Obligations, Debt Obligations or any other payments due hereunder when
required of it pursuant to this Agreement (such Co-Tenant unable or unwilling
to make such a payment being hereinafter referred to as a "Delinquent
Co-Tenant"), then Managing Co-Tenant shall so notify the other Co-Tenants who
may, within five (5) days following such notice advance the amount of such
Delinquent Co-Tenant's required payment and that amount shall be treated as a
debt of the Delinquent Co-Tenant to the other Co-Tenants which debt shall bear
interest from the date of advance to the date of repayment at the Penalty Rate.
(b) In addition to any other remedy which may be available at law or
in equity, upon failure of a Delinquent Co-Tenant to pay when due any
installment of Property Obligations, Debt Obligations or any other payments due
hereunder when required of it pursuant to this Agreement, and upon the other
Co-Tenants
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having advanced the amount of the Delinquent Co-Tenant's required payment as
set forth above, then such advance, together with interest thereon as set forth
above, shall become a lien against the Interest of such Delinquent Co-Tenant
upon the filing in the Office of the Register of the City of New York, County
of New York, of record of a notice of lien by the other Co-Tenants. To the
extent permitted by law, such lien shall be evidenced, enforced, discharged or
removed as an equitable lien under the laws of the State of New York.
(c) Each Co-Tenant authorizes Managing Co-Tenant to apply its share
of any income due it or attributable to it, from any source whatsoever, against
the amounts due any other Co-Tenants (as Co-Tenants only) (including interest)
from such Co-Tenant (as a Delinquent Co-Tenant) under this Section 3.09.
3.10. INSURANCE
(a) On and after the Distribution Date, Managing Co-Tenant shall
obtain and maintain "all risk" property insurance (covering real and personal
property and business interruption/extra expense loss) for WFC (the "Property
Policy"). The insured amount of the Property Policy shall be no less than the
greater of the replacement cost value of the Building, any leasehold
improvements therein and improvements and betterments therein or the amount
required under the WFC Indebtedness. Managing Co-Tenant shall arrange for the
other Co-Tenants to be named as
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insureds and loss-payees under the Property Policy to the extent of their
insurable interest. Managing Co-Tenant shall have the right to negotiate and
settle with the applicable insurer all claims pursuant to the Property Policy,
provided, however, that Non- Managing Designated Co-Tenant shall have the
right, upon notice to Managing Co-Tenant, to negotiate and settle directly with
the applicable insurer any claim involving the leasehold improvements or
betterments (other than personal property) when the loss only affects the
Non-Managing Designated Co-Tenant's Space or the Space of its related
Co-Tenants. The Non-Managing Designated Co-Tenant agrees to participate with
the Managing Co-Tenant with regard to the negotiating and settling of any
claims involving the core, shell or central systems within the Non-Managing
Designated Co-Tenant's Space or the Space of its related Co-Tenants or claims
involving leasehold, improvements or betterments, when the loss goes beyond the
Non-Managing Designated Co-Tenant's Space or the Space of its related
Co-Tenants. All policy terms and deductible levels shall be reasonably
acceptable to the Non-Managing Designated Co-Tenant.
(b) (i) On and after the Distribution Date, the Managing Co-Tenant
shall obtain and maintain occurrence-based commercial general liability
insurance for WFC (the "Managing Co-Tenant's Commercial Policy"). The insured
amount of the Managing Co-Tenant's Commercial Policy shall be no less than the
greater of
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One Hundred Million-Dollars ($100,000,000) or the amount specified and required
under the WFC Indebtedness. The insured amount and coverage under the Managing
Co-Tenant's Commercial Policy shall conform to and be consistent with industry
practice and include, but not be limited to, contractual liability,
products/completed operations, independent contractors, broad form property
damage, personal injury, cross liability and severability of interest. All
policy terms and deductible levels shall be reasonably acceptable to the
Non-Managing Designated Co-Tenant.
(ii) On and after the Distribution Date, the Non-Managing
Designated Co-Tenant shall obtain and maintain occurrence- based commercial
general liability insurance for WFC, excluding Common Areas (the "Non-Managing
Designated Co-Tenant's Commercial Policy"). The insured amount and coverage of
the Non-Managing Designated Co-Tenant's Commercial Policy shall conform to and
be consistent with industry practice including, but not limited to, contractual
liability, products/completed operations, independent contractors, broad form
property damage, cross liability/severability of interests and personal injury.
(iii) On and after the Distribution Date, the Non-Managing
Designated Co-Tenant shall obtain and maintain "all risk" property insurance
for the personal property of its related Co-Tenants. The personal property
shall be insured at replacement
84
cost. The form, coverage and limits covered shall conform to and be consistent
with industry practice.
(iv) (A) The Managing Co-Tenant shall name the Non-Managing
Designated Co-Tenant and its related Co-Tenants as additional insureds on the
Managing Co-Tenant's Commercial Policy to the extent necessary to insure the
Non-Managing Designated Co- Tenant and its related Co-Tenants against claims
arising out of the premises and operations of the other Non-Managing Designated
Co- Tenants Space (or the Space of its related Co-Tenants) or the Common
Facilities.
(B) The Non-Managing Designated Co-Tenant shall name the
Managing Co-Tenant and its related Co-Tenants as additional insureds on the
Non-Managing Designated Co-Tenant's Commercial Policy to the extent necessary
to insure the Managing Co- Tenant and its related Co-Tenants against claims
arising out of the premises or operations of the Non-Managing Designated Co-
Tenant's or its Related Co-Tenant's Space.
(c) The Managing Co-Tenant shall cause any Insurance Policy obtained
and maintained by it to provide, as a condition precedent to the cancellation
of such policy, a minimum of 30 days' advance written notice by such insurer to
the Non-Managing Designated Co-Tenant. A copy of each Insurance Policy
obtained by the Managing Co-Tenant shall be provided to the Non-Managing
Designated Co-Tenant.
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(d) Each policy of insurance shall contain a waiver of the insurer's
right of subrogation. A certificate of each policy issued and required to be
carried by any Co-Tenant under the Lease, any Leasehold Mortgage or hereunder
shall be delivered promptly following its availability to Managing Co-Tenant.
The Co-Tenants shall be entitled to all dividends or return premiums in
connection therewith in accordance with their payments with respect thereto in
accordance with clause (iii) of Section 2.03(b).
(e) Each of the Managing Co-Tenants and the Non-Managing Designated
Co-Tenants shall make best efforts to collect under available insurance
policies before seeking indemnification from the other, where allowed.
ARTICLE IV
TRANSFERS
4.01. CONSENT REQUIRED
Except as otherwise expressly provided in this Agreement, each of the
Co-Tenants expressly covenants that they shall not transfer, assign, mortgage,
create a security interest in, or otherwise encumber, all or any part of their
respective Interests, or sublet all or any part of their respective Spaces, or
suffer or permit all or any part of their respective Spaces to be used by
others.
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4.02. SUBLETTING PERMITTED
Except with respect to a sublease to an Affiliate (as to which the
following limitations shall not apply and which is permitted hereunder from
time to time upon ten (10) business days prior notice to the Managing
Co-Tenant), provided that there shall have been no exercise of a Right of First
Offer or Right of First Refusal (as such terms are hereinafter defined) with
respect to a proposed subletting of Space, Managing Co-Tenant shall, on behalf
of the Co-Tenants and for the account of the subletting Co-Tenant, enter into a
sublease of all or a portion of said subletting Co-Tenant's Space, provided
that:
(i) such sublease shall be for a term of not less
than five (5) years;
(ii) the portion of the Space demised under such sublease shall
not be less than one (1) full floor of the Building;
(iii) such sublease shall provide for fair market terms,
concessions and rental;
(iv) the terms and conditions of such sublease (including the
specific uses permitted thereunder) shall be in form and substance reasonably
acceptable to Managing Co-Tenant and shall comply in all respects with the
terms and provisions of the Lease and any and all Leasehold Mortgages;
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(v) the subtenant shall (a) have a financial rating, as measured
by the Standard and Poor's Corporation, of not less than "Investment Grade" (or
successor rating of similar standing), or (b) be an entity with a balance sheet
and income statement, which Managing Co-Tenant determines to be reasonably
adequate, taking into consideration the terms and provisions of the sublease in
question;
(vi) such sublease shall by its terms appoint the Managing
Co-Tenant to administer such sublease on behalf of the subletting Co-Tenant;
(vii) the subletting Co-Tenant shall indemnify and hold harmless
the other Co-Tenants and the Property from and against any and all real
property transfer and transfer gains taxes and any Commercial Rent or Occupancy
Tax, attributable to such sublease;
(viii) if the subletting Co-Tenant is (A) a Lehman Co-Tenant, the
subtenant shall not then be engaged in any signif- icant business or businesses
of any AMEX Co-Tenant, or (B) an AMEX Co-Tenant, the subtenant shall not then
be engaged in any significant business or businesses of any Lehman Co-Tenant;
(ix) the subtenant shall, in the reasonable judgment of Managing
Co-Tenant, be of a character in keeping with the standards of the Building as a
first-class New York City office
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building and consistent with other tenants and/or occupants in the Building;
and
(x) the proposed subtenant shall not be entitled, directly or
indirectly, to diplomatic or sovereign immunity and shall be subject to the
service of process in, and the jurisdiction of the courts of, the State of New
York.
4.03. ASSIGNMENTS
Supplementing each of the other provisions contained in this Agreement
respecting the assignment or other transfer of any Interest of a Co-Tenant
hereunder, there shall be no assignment or transfer whatsoever of any Interest
of a Co-Tenant, in whole or in part, without the consent of Managing Co-Tenant,
which consent shall be granted or denied in the sole and absolute discretion of
Managing Co-Tenant until such time as the Existing Leasehold Mortgages and
Existing Notes are satisfied. After the satisfaction of the Existing Leasehold
Mortgages and Existing Notes, there shall be no assignment or transfer
whatsoever of any Interest of a Co- Tenant, in whole or in part, without the
consent of the Managing Co-Tenant, which consent shall not be unreasonably
withheld or delayed provided that:
(i) the terms and conditions of such assignment shall be in form and
substance reasonably acceptable to Managing Co-Tenant and shall comply in all
respects with the terms and provisions of the Lease and any and all Leasehold
Mortgages;
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(ii) the assignee shall (a) have a financial rating, as measured by
the Standard and Poor's Corporation, of not less than "Investment Grade" (or
successor rating of similar standing), or (b) be an entity with a balance sheet
and income statement, which Managing Co-Tenant determines to be reasonably
adequate, taking into consideration the terms and provisions of the assignment
in question;
(iii) the assigning Co-Tenant shall indemnify and hold harmless the
other Co-Tenants and the Property from and against any and all real property
transfer and transfer gains taxes and any Commercial Rent or Occupancy Tax,
attributable to such assignment;
(iv) if the assigning Co-Tenant is (A) a Lehman Co-Tenant, the
assignee shall not then be engaged in any significant business or businesses of
any AMEX Co-Tenant, or (B) an AMEX Co-Tenant, the assignee shall not then be
engaged in any significant business or businesses of any Lehman Co-Tenant;
(v) the assignee shall, in the reasonable judgment of Managing
Co-Tenant, be of a character in keeping with the standards of the Building as a
first-class New York City headquarters office building and consistent with
other tenants and/or occupants in the Building; and
(vi) the proposed assignee shall not be entitled, directly or
indirectly, to diplomatic or sovereign immunity and
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shall be subject to the service of process in, and the jurisdiction of the
courts of, the State of New York.
4.04. ADDITIONAL RESTRICTIONS
(a) Each sublease or instrument of assignment of a CoTenant's Space
or Interest as the case may be, is to be executed by Managing Co-Tenant on
behalf of the Co-Tenants. Each sublease or instrument of assignment shall
contain an assumption by the subtenant or assignee, as the case may be, of the
obligations of the sublessor or assignor, as the case may be, hereunder. Each
assigning or subletting Co-Tenant shall remain fully liable for the performance
of all of its obligations hereunder notwithstanding any subletting or
assignment provided for herein and, without limiting the generality of the
foregoing, shall remain fully responsible and liable to the other Co-Tenants
for all acts and omissions of any subtenant, assignee or anyone claiming by,
through or under any subtenant or assignee, which shall be in violation of any
of the obligations of this Agreement, and any such violation shall be deemed to
be a violation by the Co-Tenant. Notwithstanding any assignment and assumption
by the assignee of the obligations of a Co-Tenant, said Co-Tenant (unless
released in accordance with the following sentence), and each immediate or
remote successor in interest of said Co-Tenant shall remain liable, jointly and
severally (as a primary obligor), with its assignee and all subsequent
assignees for the performance of said
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Co-Tenant's obligations hereunder, and shall remain fully and directly
responsible and liable to each of the other Co-Tenants for all acts and
omissions on the part of any assignee or subtenant subsequent to it in
violation of any of the obligations of this Agreement. A Co-Tenant which has
assigned its Interest in whole or in part may be released of all responsibility
and liability for the performance of its obligations hereunder with respect to
its assigned Interest only, provided that all such responsibilities and
liabilities are assumed by an entity which, in Managing Co-Tenant's reasonable
discretion, has a financial standing comparable to that of said Co-Tenant as of
the date of the assignment and assumption in question.
(b) If there shall be any assignment, sublease or other agreement of
occupancy of a Co-Tenant's Space or Interest, as the case may be, permitted
under this Agreement, of or affecting all or any portion of such Co-Tenant's
Space, or if there is any transfer of the Co-Tenant's Interest by operation of
law or otherwise, and if such Co-Tenant shall be entitled to any consideration
from the assignee, subtenant or licensee for or in connection with the
assignment of such Co-Tenant's Interest or the subletting or occupancy of such
Co-Tenant's Space, subject to the provisions of Section 4.07(d), said Co-Tenant
shall be entitled to receive all such consideration, and any interest earned
thereon pursuant to Section 3.05(a).
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(c) The consent of Managing Co-Tenant to an assignment or a
subletting, shall not relieve any Co-Tenant from obtaining the consent of
Managing Co-Tenant to any further assignment or subletting.
4.05. TRANSFEREE USE OF UTILITY FACILITIES AND COMMON FACILITIES
(a) In the event of an assignment or transfer of the Interest of a
Co-Tenant, in whole or in part (other than to an Affiliate), or a subletting of
any or all of a Co-Tenant's Space (other than to an Affiliate), or the
occupancy of any or all of Co-Tenant's Space by an entity or individual other
than the Co-Tenant or an Affiliate, the assignee, transferee, subtenant or
occupant of said Interest or Space (the "Transferee"), as the case may be,
shall not be permitted to use (i) the Utility Facilities if and to the extent
Managing Co-Tenant determines that any such use would materially diminish or
reduce the availability or security of Utility Facilities to the Co-Tenants
then occupying Space in the Building, or (ii) without Managing Co-Tenant's
prior consent, which consent shall be in the sole and absolute discretion of
the Managing Co-Tenant, any Special Common Facilities. If Managing Co-Tenant
shall fail or refuse to consent to the use of a Special Common Facility by a
Transferee and the transferring Co- Tenant does not elect to utilize said
Special Common Facility for its own purposes, the Maintenance Cost and the
Usage Cost shall be
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equitably reapportioned among the Co-Tenants (other than the transferring
Co-Tenant and the Transferee) so as to ensure that such costs are thereafter
fully satisfied except as otherwise provided above, a Transferee shall be
entitled to utilize the Common Facilities on the same basis and cost as the
Initial Co-Tenants provided, however, that the Transferring Co-Tenant shall
indemnify and hold hereunder to the fullest extent permitted by law the other
Co-Tenants (including the Managing Co-Tenant) from and against all losses,
claims, damages, liabilities, costs and expenses (including, without
limitation, reasonable attorney fees) based on, arising out of or resulting
from, or in connection with use of the Common Facilities by the Transferee, its
employees, agents and investees.
4.06. PARTITION
(a) So long as any Initial Co-Tenant or an Affiliate shall own an
Interest, any rule of law to the contrary notwith- standing, except as
specifically provided in this Agreement:
(i) notwithstanding any changes in the ownership of an Interest,
the Interests will continue to be subject to this Agreement;
(ii) no Co-Tenant shall terminate or commence any proceeding to
attempt to terminate this Agreement;
(iii) no Co-Tenant shall have the right to partition the
Leasehold or the Building and no Co-Tenant shall apply
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for, commence or prosecute any action or proceeding for partition, it being
understood and agreed by the Co-Tenants that a material inducement to their
entering into this Agreement is that their sole and exclusive methods to divest
themselves of their Interest are as specifically set forth in this Agreement;
and
(iv) any transfer, assignment, mortgaging, creation of a security
interest in, or encumbrance of, an Interest, or subletting of any Space, in
breach of this Agreement shall be null and void.
4.07. RIGHT OF FIRST OFFER
(a) Subject to the provisions of Section 4.03 and except as provided
in Section 4.07(e), if at any time during the term of this Agreement, any
Co-Tenant shall desire to sublet all or any portion of its Space or assign or
otherwise transfer its Interest, to any person or entity, then Lehman, if such
Co-Tenant is a Lehman Co-Tenant, or Amexco, if such Co-Tenant is an AMEX
Co-Tenant, (the "Transferring Co-Tenant"), shall give notice thereof
(hereinafter called "Co-Tenant's Notice") to the Managing Co-Tenant, setting
forth the terms and conditions upon which the Transferring Co-Tenant is willing
to sublet such Space, or assign or otherwise transfer its Interest, as the case
may be. The Managing Co-Tenant shall have the right for itself or its
Affiliates (the "Right of First Offer") to sublease such space, take an
assignment of, or otherwise be the transferee of the Transferring Co-Tenant's
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Interest, as the case may be, upon the terms and conditions set forth in the
Co-Tenant's Notice. In order to exercise the Right of First Offer, the
Managing Co-Tenant must give notice of such exercise (hereinafter called the
"First Offer Exercise Notice") to the Transferring Co-Tenant prior to the end
of the thirtieth (30th) day after the receipt of a Co-Tenant's Notice (said
thirty-day period being hereinafter referred to as the "First Offer Period").
Time shall be of the essence with respect to the giving of the First Offer
Exercise Notice.
(b) If the Managing Co-Tenant shall not exercise its Right of First
Offer, then the Transferring Co-Tenant shall, subject to compliance with the
provisions of Section 4.02 or Section 4.03, as the case may be, and Section
4.08, be free so to sublet, assign or otherwise transfer, as the case may be,
the Space or Interest which was the subject of the Co-Tenant's Notice to any
other person or entity (the "Outside Party") upon terms and conditions not more
favorable to the Outside Party than those set forth in the Co-Tenant's Notice.
If Co-Tenant shall fail to sublease, assign or otherwise transfer, as the case
may be, such Space or Interest to any Outside Party on such terms and
conditions within 270 days with respect to an assignment, and 180 days with
respect to a sublease, after the date of receipt of the Co-Tenant's Notice, and
if the Transferring Co-Tenant shall still desire to sublease, assign or
otherwise transfer, as the case may
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be, such Space or Interest, then the procedure set forth in the foregoing
provisions of this Section 4.07 shall be followed in respect of said
subleasing, assigning or other transfer thereof.
(c) If the Managing Co-Tenant shall effectively exercise its Right of
First Offer, then the Transferring Co-Tenant shall sublease, assign or
otherwise transfer, as the case may be, to the Managing Co-Tenant (or its
Affiliate) (herein the "exercising Co-Tenant") and the exercising Co-Tenant
shall hire and take from the Transferring Co-Tenant said Space or Interest upon
the terms and conditions set forth in the Co-Tenant's Notice. Without
limitation of the foregoing, the exercising Co-Tenant shall, with respect to
the Interest, be subject to all of the terms and provisions set forth in this
Agreement, the Lease and any Leasehold Mortgages, including, without
limitation, all provisions respecting the use of the Space.
(d) The Transferring Co-Tenant shall indemnify and hold harmless the
other Co-Tenants (other than the exercising Co- Tenant) and the Property from
and against any and all real property transfer and transfer gains taxes, and
any Commercial Rent or Occupancy Tax, in any way related to the transfer of the
offered Space or Interest and shall execute and deliver all documents and
instruments to the exercising Co-Tenant as necessary and appropriate to
effectuate the transfer of such Space or Interest, as the case may be. If, as
of the closing, the Transferring Co-Tenant
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has any outstanding debts to the other Co-Tenants (as Co-Tenants), an amount
sufficient to satisfy all such outstanding debts including any interest earned
thereon, shall be paid to Managing Co-Tenant out of the proceeds for the
sublease, assignment or other transfer at the closing thereof, to be held for
and on behalf of the Transferring Co-Tenant until all such outstanding debts of
the Transferring Co-Tenant, including interest, if any, shall have been paid
and discharged in full.
(e) Notwithstanding anything to the contrary contained in this
Article IV, the Right of First Offer shall not be appli- cable with respect to
(i) any sublease or assignment to an Affiliate of the Co-Tenant or (ii) any
sublease to an existing subtenant of the Transferring Co-Tenant (previously
approved by the Managing Co-Tenant in accordance with the terms and provisions
of Section 4.02 hereof) then occupying at least 100,000 square feet of space in
the Premises (a "Major Subtenant").
4.08. RIGHT OF FIRST REFUSAL
(a) Subject to the provisions of Section 4.03 and except as provided
in Section 4.08(d), if at any time during the term of this Agreement, any
Co-Tenant shall desire to sublet all or any portion of its Space or assign or
otherwise transfer all or any part of its Interest to any person or entity in
accordance with a bona fide offer therefor (a "Bona Fide Offer"), then Lehman,
if such Co-Tenant is a Lehman Co-Tenant, or Amexco, if
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such Co-Tenant is an AMEX Co-Tenant, so desiring to accept such Bona Fide Offer
(the "Offeree Co-Tenant") shall give the other Designated Co-Tenant (i) a copy
of such Bona Fide Offer and (ii) a written notice which shall set forth the
identity, resume of individual principals and general financial and managerial
capacity of the offeror of the Bona Fide Offer (the "BFO"), including, without
limitation, information with respect to any financial rating and credit history
thereof, and the intended use or uses of the transferred portion of the Space
or the Interest (collectively, the "Bona Fide Offer Notice"). Every Bona Fide
Offer shall be expressed only in cash and/or debt securities payable in lawful
money. Additionally, the Offeree Co-Tenant shall, at a time not later than the
receipt by the other Designated Co-Tenant of a Bona Fide Offer Notice, have
delivered to the BFO a written notice which expressly states that the BFO's
offer is subject to the Right of First Refusal (hereinafter defined) provided
for herein. The other Designated Co-Tenant shall thereafter have the right for
itself, its Affiliates or its Major Subtenants (the "Right of First Refusal")
to sublease, take an assignment of, or otherwise be the transferee of, as the
case may be, the Offeree Co-Tenant's Space or Interest, as the case may be, on
terms which reflect at least the same amount of cash as the amount contained in
the Bona Fide Offer and debt securities of equivalent value to the debt
securities which are part of the Bona Fide Offer (such valuation
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in each case to be made by an investment banker reasonably acceptable to both
the Offeree Co-Tenant and the other Designated Co-Tenant). The other
Designated Co-Tenant shall exercise such Right of First Refusal by giving the
Offeree Co-Tenant written notice thereof within ten (10) days (the "First
Refusal Period") after receipt of the Bona Fide Offer Notice from the Offeree
Co-Tenant of its desire to transfer its Space or Interest, as the case may be.
Time shall be of the essence as to the First Refusal Period.
(b) Failure to deliver written notice prior to the end of the final
day of the First Refusal Period shall constitute an election not to exercise
the Right of First Refusal with respect to such Offeree Co-Tenant's Space or
Interest, as the case may be. In the event of any exercise of the Right of
First Refusal, the transfer of the Offeree Co-Tenant's Interest to the other
Designated Co-Tenant (or its Affiliate) (herein the "exercising Co-Tenant")
shall be consummated and closed within one hundred twenty (120) days (or, if
additional time is needed to obtain any regulatory approvals, as soon as
possible thereafter) after the date of the Offeree Co-Tenant's Bona Fide Offer
Notice. The Offeree Co-Tenant shall indemnify and hold harmless the other
Co-Tenants (other than the exercising Co-Tenant) and the Property from and
against any and all real property transfer and transfer gains taxes, and any
Commercial Rent or Occupancy Tax, in any way
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related to such transfer, and shall execute and deliver all documents and
instruments to the exercising Co-Tenant as necessary and appropriate to
effectuate the transfer of such offered Space or Interest, as the case may be.
If as of the closing the Offeree Co-Tenant has any outstanding debts to the
other Co-Tenants (as Co-Tenants), an amount sufficient to satisfy all such
outstanding debt, including any interest earned thereon, shall be paid to the
Managing Co-Tenant for and on behalf of the Offeree Co-Tenant until all
outstanding debts relating to the Property of the Offeree Co-Tenant, including
interest, if any, shall have been paid and discharged in full.
(c) In the event there is no timely exercise of the Right of First
Refusal in a particular instance and the consent of the Managing Co-Tenant is
obtained, an Offeree Co-Tenant shall then be permitted in such instance to
transfer its Space or Interest, as the case may be, to the person or entity
identified in the Bona Fide Offer Notice on terms identical in all material
respects to those described therein. The closing and consummation of such
transfer shall occur within one hundred eighty (180) days after the date set
forth for the date of closing in the Bona Fide Offer Notice (or, if additional
time is needed to obtain any regulatory approvals, as soon as possible
thereafter), and, if such transfer is not so closed and consummated to such
person or entity on such identical terms within such one hundred eighty
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(180) day period (as extended, as set forth above), the Right of First Refusal
shall again be exercisable with respect to the Space or Interest thereafter
proposed to be transferred. In the event any Space or Interest is sublet or
transferred in accordance with the terms hereof, then the person or entity to
whom such Space or Interest is transferred shall take such Space or acquire
such Interest, subject in all respects to the terms and provisions of this
Agreement.
(d) Notwithstanding anything to the contrary contained in this
Article IV, the Right of First Refusal shall not be applicable with respect to
(i) any sublease or assignment to an Affiliate of the Co-Tenant or (ii) a
sublease to a Major Subtenant.
4.09. REQUIRED TRANSFERS
If AEBL, TRSCO or any other Co-Tenant which is then one of the AMEX
Co-Tenants, on one hand, or LGS, LCP or any other Co-Tenant which is then one
of the Lehman Co-Tenants, on the other hand, shall at any time cease to be an
Affiliate of Amexco or Lehman, as the case may be, then the Interest of such
Co-Tenant shall at the option of the related Designated Co-Tenant be
transferred to such related Designated Co-Tenant and such related Designated
Co-Tenant shall have the right to sublet back such space to the entity that has
ceased to be an Affiliate upon market terms and conditions subject to the terms
and conditions of
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Section 4.02 hereof. If such related Designated Co-Tenant elects not to
exercise such option to acquire such Interest, then the non-related Designated
Co-Tenant shall have the right to acquire from the related Designated Co-Tenant
such Interest, upon 180 days' notice, at Fair Market Value as determined
pursuant to the Option Agreement, dated as of the date hereof, among the Lehman
Co- Tenants and the Amex Co-Tenants.
4.10. BROKERAGE
(a) No Co-Tenant shall contact, have discussions or negotiate with in
any manner whatsoever, a broker, finder or like agent in connection with any
sublease of any part of its Space, assignment or other transfer in whole or in
part of its Interest, except through its Designated Co-Tenant, which shall
coordinate all brokerage activities with respect to the Building with the other
Designated Co-Tenant.
(b) Managing Co-Tenant shall have the right to contract with a broker
in order to facilitate the rental of any portion of the Retail Space in the
Property or any Common Facilities which shall have been converted to office or
retail use. Any brokerage commission due in the event of the rental of any
such space shall be borne by the Co-Tenants in accordance with their respective
Interests.
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4.11. RIGHT OF DISAPPROVAL
Notwithstanding anything contained herein to the contrary, with
respect to any proposed mortgaging, creation of a security interest, or other
encumbrances of all or any part of a Co-Tenant's Interest, Managing Co-Tenant,
shall have the right (the "Right of Disapproval"), to be exercised in its sole
and absolute discretion, to disapprove of any such proposal, and if Managing
Co-Tenant, should exercise such Right of Disapproval with respect to any such
proposal, the party making such proposal shall not effect or permit to be
effected the proposed mortgaging, creation of security interest or other
encumbrance, as the case may be.
4.12. SUBMISSION TO CONDOMINIUM REGIME
(a) After satisfaction of the Existing Leasehold Mortgages and
Existing Notes, upon the request of either Designated Co-Tenant and upon ninety
(90) days' notice from one to the other, the Co-Tenants shall together submit
the Leasehold to the provisions of Article 9-B of the Real Property Law of the
State of New York or any statute in lieu thereof (the "Condominium Act") by
executing and recording such instruments (collectively, the "Declaration") by
which the Leasehold is submitted to the Condominium Act, together with all
amendments, modifications and all supplements thereto, subject in all respects
to any requisite consent by the landlord under the Lease and the holders of any
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Leasehold Mortgage. Except as provided in this Section 4.13, the Declaration
(or other documents executed in connection therewith or contemporaneously
thereto) shall conform in all material respects to the terms, provisions and
intent of this Agreement and shall provide, inter alia, (i) for the Interests
of each Co-Tenant under this Agreement to be exchanged for an appropriate
condominium unit as described in the Declaration, (ii) for Common Facilities to
be treated substantially in the same manner as provided in this Agreement,
(iii) for Managing Co-Tenant to have the rights and obligations contained (and
to be determined or designated, as the case may be, in the manner set forth)
in this Agreement, (iv) for restrictions on the transfers of, and encumbrances
upon, the condominium units which are equivalent to the restrictions on the
transfers of, and encumbrances upon, the Interests and subletting of Space
contained in this Agreement (as supplemented and modified by clause (b),
below), provided, however, that the Declaration shall not contain a right of
disapproval comparable to the right described in Section 4.12, and (v) for
costs with respect to the Property to be allocated and paid as provided in this
Agreement.
(b) The Declaration (and such other documents) shall permit the owner
of each condominium unit to:
(i) enter into a traditional "sale-leaseback" financing
transaction with an "institutional lender", as such term is defined in the
Lease (an "Institutional Lender") , which is not
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an entity of the type proscribed in clause (x) of Section 4.02, provided that
the other unit owners are given a right of first offer, comparable to the right
described in Section 4.07, both to enter into the sale-leaseback as the
owner/lessor and to acquire the interest of the owner/lessor upon all
subsequent transfers thereof;
(ii) grant a mortgage encumbering its condominium unit to an
Institutional Lender which is not an entity of the type proscribed in clause
(x) of Section 4.02, provided that the other unit owners are given a right of
first offer, comparable to the right described in Section 4.07, to be the
mortgagee in any such mortgage transaction, and, notwithstanding anything
contained elsewhere herein, permit a successful bidder/purchaser at a
foreclosure sale to transfer its interest in the condominium unit to a
transferee free of any occupancy restrictions or any restrictions on transfers
contained in the Declaration, provided that said transferee and all subsequent
transferees shall take the condominium unit subject to all such restrictions;
and
(iii) transfer its condominium unit to a transferee which has a
financial rating or balance sheet and income statement of the type described in
clause (v) of Section 4.02, which is not a competitor of the type described in
clause (viii) of Section 4.02 and which is not an entity of the type proscribed
in clause (x) of Section 4.02, provided that the other unit owners
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are given the right of first refusal (comparable to the right described in
Section 4.08), and further provided that the condominium unit shall be occupied
only in accordance with the provisions of the Declaration.
(c) The Leasehold shall not be submitted to the provisions of the
Condominium Act if, in the opinion of Stroock & Stroock & Lavan (or any other
law firm selected by the Managing Co-Tenant), (i) the provisions of the
Declaration with regard to the clauses set forth in (a) and (b) above, are,
more likely than not, unenforceable, (ii) the Leasehold Mortgages then
outstanding cannot be partially released and/or reallocated to permit a
transfer of a condominium unit or (iii) the Declaration shall contain any
provision which in any material respect violates any provision of law.
(d) The Designated Co-Tenant initially electing to file the
Declaration shall pay all costs and expenses incurred in order to file the
Declaration and effect the exchange of Interests as referred to in clause (a)
above (the "Submission Costs"), which shall include, without limitation,
transfer and transfer gains taxes and attorneys' fees and disbursements and
shall reimburse the other Designated Co-Tenant for those costs and expenses
which the other Designated Co-Tenant would not have incurred if not for the
filing of the Declaration including, without limitation, loss of any tax
credits or governmental benefits or subsidies.
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ARTICLE V
GENERAL
5.01. NOTICES
(a) All notices, demands, consents, approvals, requests or other
communications provided for or permitted to be given pursuant to this Agreement
must be in writing.
(b) All notices, demands, consents, requests or other communications
to be sent to any Co-Tenant hereunder shall be deemed to have been properly
given or served when personally delivered, provided receipt is acknowledged, or
three days after being deposited in the United States mails, postage prepaid,
certified mail, return receipt requested.
(c) All notices required, permitted or appropriate hereunder shall be
served upon the respective parties at the following addresses:
If to the AMEX
Co-Tenants, to
Amexco at: American Express Company
American Express Tower
World Financial Center
New York, New York 10285
Attn: General Counsel
If to the Lehman
Co-Tenants, to
Lehman at: Lehman Brothers Inc.
American Express Tower
World Financial Center
New York, New York 10285
Attention: Vice-Chairman
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or to such other addresses as may be designated by notice to the other parties
hereto.
5.02. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement among the Co-Tenants
relative to the Property, its ownership and its operation. No variations,
modifications, or changes herein or hereof shall be binding upon any Co-Tenant
unless set forth in a document duly executed and acknowledged by or on behalf
of such Co-Tenant (through its Designated Co-Tenant).
5.03. GOVERNING LAWS
This Agreement and the rights and obligations of the Co-Tenants
hereunder shall be interpreted, construed and enforced in accordance with the
laws of the State of New York.
5.04. WAIVER
No consent or waiver, express or implied, by any Co-Tenant to or of
any breach or default by any other Co-Tenant in the performance by a Co-Tenant
of its obligations hereunder shall be deemed or construed to be a consent or
waiver to or of any other breach or default in the performance by any Co-Tenant
of the same or any other obligations of any other Co-Tenant hereunder. Failure
on the part of any Co-Tenant to complain of any act or failure to act of any
other Co-Tenant or to declare any other Co-Tenant in default, irrespective of
how long such failure
109
continues, shall not constitute a waiver by such Co-Tenant of its rights
hereunder.
5.05. SEVERABILITY
(a) If any provision of this Agreement or the application thereof to
any person or circumstance shall be invalid or unenforceable to any extent, the
remainder of this Agreement and the application of such provisions to other
persons or circum- stances shall not be affected thereby and shall be enforced
to the greatest extent permitted by law.
(b) If any provision of this Agreement or the application thereof to
any person or circumstance shall violate any of the provisions of the Lease or
any Leasehold Mortgages, then said provision of this Agreement shall be deemed
to be of no force and effect, it being understood that said provision shall
continue to have full force and effect with respect to the application thereof
to all other persons or circumstances.
5.06. BENEFIT
The provisions of this Agreement relate only to the Co-Tenants and
their successors and permitted assigns, and are not intended to benefit any
other parties and are in no event to be enforceable by any other parties.
110
5.07. TERMINOLOGY
All personal pronouns used in this Agreement, whether used in the
masculine, feminine, or neuter gender, shall include all other genders; the
singular shall include the plural and vice versa. Titles are for convenience
only, and neither limit nor amplify the provisions of this Agreement.
5.08. STATUS REPORTS
Recognizing that each Co-Tenant may find it necessary from time to
time to establish to third parties such as accountants, banks, mortgagees,
subtenants and assignees, or the like, the then current status of performance
hereunder, each Co-Tenant agrees, upon the written request of any other
Co-Tenant, made from time to time, to prepare, execute and furnish to the
requesting Co-Tenant promptly a written statement (which statement shall be
acknowledged, if requested) with respect to the status of any matter pertaining
to this Agreement, which statement may be to the best of the knowledge and
belief of the party making such statement.
5.09. NO RECORDING OF THIS AGREEMENT
The Co-Tenants covenant that neither this Agreement, nor any
memorandum hereof, shall be filed or recorded.
5.10. BINDING AGREEMENT
Subject to the restrictions on transfers and encumbrances set forth
herein, this Agreement shall inure to the bene-
111
fit of and be binding upon the Co-Tenants and their respective successors
(whether by operation of law or otherwise), and permitted assigns.
5.11. LIABILITY OF CO-TENANTS/INDEMNIFICATION
(a) In performing its duties hereunder, each Co-Tenant shall act at
all times in good faith and shall use best efforts in all respects to collect
from the Building's and each Co-Tenant's respective insurance policy before
proceeding against another Co- Tenant hereunder.
(b) In the event of any physical damage to property of any Co-Tenant
(a "Non-Negligent Co-Tenant"), to the extent such physical damage is not
covered by insurance, such Non-Negligent Co-Tenant shall be responsible for
such uninsured damage provided that, to the extent such damage was caused by
the gross negligence, bad faith or wilful misconduct of any other Co-Tenant,
such Co- Tenant shall indemnify, defend and hold such Non-Negligent Co-Tenant
harmless from and against all uninsured physical property damage incurred by
such Non-Negligent Co-Tenant and caused by such gross negligence, bad faith or
wilful misconduct.
(c) Amexco and Lehman hereby mutually indemnify one another and hold
the other free and harmless from and against any losses or damages, which may
be incurred by, or asserted against, either Amexco or Lehman on account of the
injury to any person or property damage liability occurring at any of the
Common Facili-
112
ties. Amexco and Lehman shall be liable for any losses or damages arising out
of injuries to a third party or third party's property sustained in a Common
Facility in accordance with the respective Interest, provided however that in
regard to injuries to a third party or a third party's property who is an
employee of any Co-Tenant, Amexco and Lehman shall be jointly (but not
severally) liable for any such losses and damages on a 50/50 basis and;
provided, further however, that in regard to injuries to a third party or a
third party's property sustained entirely within a Co-Tenant's Space, the
Co-Tenant occupying such Space shall indemnify and hold harmless all other
Co-Tenants against losses or damages arising out of claims brought by such
third party.
(d) Notwithstanding anything to the contrary contained herein, no
Co-Tenant shall be liable to any other Co-Tenant for any consequential damages
(including without limitation, loss of business, and loss of use or income from
the Property), as the result of any loss or damage incurred by any Co-Tenant in
connection with the Building.
(e) In connection with the Managing Co-Tenant entering into any
contract or agreement with a vendor, the Managing Co- Tenant will endeavor to
require that such vendor have insurance in force that is reasonable and
customary, and will endeavor in good faith to require that such policies of
insurance name each Co-Tenant as an additional insured. The failure of the
Managing Co-
113
Tenant to comply with the foregoing shall not result in any liability accruing
to the Managing Co-Tenant unless the Managing Co- Tenant acts in complete
disregard with respect to its obligations set forth in this paragraph (e).
5.12. CLAIMS
Whenever any Co-Tenant shall learn through the filing of a claim or
the commencement of a proceeding or otherwise of the existence of any liability
for which another Co-Tenant is or may be responsible and which relates to the
Property, such Co-Tenant shall notify the other Co-Tenants and Managing
Co-Tenant promptly and furnish such copies of documents (and make originals
thereof available) and such other information as such Co-Tenant may have which
may be used or useful in the defense of such claims.
5.13. CONSENT OR APPROVAL
In any case where the provisions of this Agreement require the consent
or approval of Managing Co-Tenant (other than such consents or approvals as
required in Article IV hereof), Managing Co-Tenant agrees that it will respond
affirmatively or negatively (stating specific reasons for the denial) and in
writing to requests for such consents or approvals within ten (10) days of
receipt therefor unless Managing Co-Tenant advises in writing it will need
longer than ten (10) days, in which case Managing Co-Tenant shall respond
within thirty (30) days of receipt of written request therefor, it being
understood that any
114
such request for approval shall apply only with respect to the particular
matter or act to which such consent or approval is sought. If Managing
Co-Tenant shall fail to so respond affirmatively or negatively (with specific
reasons for the denial) to any such request within such 10-day period, the
requested consent or approval of Managing Co-Tenant shall be deemed to have
been given.
5.14. TERM
(a) The term of this Agreement shall commence on the date of
execution hereof and shall continue until the earlier occurrence of the
following events:
(i) the assignment or other transfer (by one or a series of
transactions) of the whole of the Interests of each of the Initial Co-Tenants
(including a termination of the Lease) and the distribution of the proceeds of
such transfer or transfers; or
(ii) the decision of the Managing Co-Tenant to terminate this
Agreement.
(b) In the event of the assignment or other transfer of the whole of
the Interests of each of the Co-Tenants (including a termination of the Lease),
the parties agree that the costs incurred in connection with such transfer
including, without limitation, all real property and transfer gain taxes shall
be paid by the Co-Tenants in accordance with their respective Interests at the
time of such transfer and that any monies remaining
115
shall be distributed to the Co-Tenants in accordance with their respective
Interests at the time of such transfer.
5.15. ARBITRATION
All disputes or questions between or among the Co-Tenants shall be
settled by arbitration as hereinafter provided. All arbitrations shall be
initiated, prosecuted and defended by the Designated Co-Tenants only. The
Designated Co-Tenant desiring arbitration shall appoint a disinterested person
as arbitrator on its behalf and give notice thereof to the other Designated
Co-Tenant who shall, within 15 days thereafter, appoint a second disinterested
person as arbitrator on its behalf and-give written notice thereof to the first
Designated Co-Tenant. The two arbitrators thus appointed shall together
appoint a third disinterested person within 15 days after the appointment of
the second arbitrator, and said three arbitrators shall, as promptly as
possible, determine the matter which is the subject of the arbitration and the
decision of the majority of them shall be conclusive and binding on all
Co-Tenants and judgment upon the award may be entered in any court having
jurisdiction. If, after appointment of the first arbitrator, the Designated
Co-Tenant who shall have the right pursuant to the foregoing to appoint a
second arbitrator fails or neglects to do so, then in such event, the other
Designated Co-Tenant (or if the two arbitrators appointed by the Designated
Co-Tenants shall fail to appoint a third arbitrator
116
when required hereunder, then either Designated Co-Tenant) may apply to any
court of competent jurisdiction to appoint such arbitrator. The arbitration
shall be conducted in the City and County of New York and, to the extent
applicable and consistent with this Section 5.16, shall be in accordance with
the Commercial Arbitration Rules then obtaining of the American Arbitration
Association or successor body of similar function. The expenses of arbitration
shall be shared equally by the Designated Co-Tena- nts, and each Designated
Co-Tenant shall be responsible for the fees and disbursements of its own
attorneys and the expenses of its own proof. The Co-Tenants agree to sign all
documents and do all other things necessary to submit any such matter to
arbitration and further agree to, and hereby do, waive any and all rights they
or any of them may at any time have to revoke their agreement hereof to submit
to arbitration and to abide by the decision rendered thereof. The arbitrators
shall have no power to vary or modify any of the provisions of this Agreement
and their jurisdiction is limited accordingly. If the arbitration concerns
only construction matters, then each of the arbitrators shall be licensed
professional engineers or registered architects, having at least ten (10)
years' experience in the design of office buildings. If the arbitration
concerns only the value of real property, then each of the arbitrators shall be
members of the American Institute of Real Estate Appraisers or the Society of
117
Real Estate Appraisers, or any successor bodies of comparable function, having
at least ten (10) years' experience in the appraisal of first class office
buildings.
5.16. CONSUMER PRICE INDEX
As used herein, the term "Consumer Price Index" shall mean the
"Consumer Price Index for All Urban Consumers" (1967-100) specified for "All
Items" relating to New York-Northern New Jersey-Long Island, NY-NJ-CT,
published by the Bureau of Labor Statistics of the United States Department of
Labor, or any successor index thereto covering New York City, appropriately
adjusted.
5.17. AFFIRMATIVE ACTION PROGRAM
The Co-Tenants hereby acknowledge that in connection with the
acquisition of the Property, the Co-Tenants became bound to the provisions of a
certain Affirmative Action Program Agreement, a copy of which is annexed to the
Lease as Exhibit C. Such Affirmative Action Program Agreement requires
compliance with BPCA's affirmative action program. The Co-Tenants further
acknowledge that the Affirmative Action Program Agreement continues to be, and
shall remain throughout the term of the Lease, in full force and effect and
each Co-Tenant covenants to faithfully observe and comply with all provisions
contained therein.
118
5.18. SIGNS; NAME OF BUILDING
(a) No Co-Tenant shall display or erect any lettering, signs,
advertisements, posters, displays or awnings on the outside of its Space or any
interior signs which are visible from the outside (collectively, "Signs")
without obtaining Managing Co-Tenant's prior written approval. In addition to
complying with all of the terms and conditions of this Agreement and the Lease,
each Co-Tenant shall submit to Managing Co-Tenant a detailed sketch of any such
Sign and if approved, the same shall not be altered in any manner whatsoever
without first obtaining Managing Co-Tenant's prior written consent for such
proposed change. All such Signs shall be maintained by the Co-Tenant at its
sole cost and expense in good order and condition, and in accordance with all
of the terms and provisions of this Agreement. Any work done with respect to
any Sign shall be considered to be a Co-Tenant's Change hereunder.
(b) Amexco shall be permitted to change the name of the Building to
conform with a change in the name of Amexco, without the consent of any
Co-Tenant.
5.19. RULES AND REGULATIONS
Each Co-Tenant agrees to comply with such rules and regulations which
may from time to time be promulgated by the Managing Co-Tenant with respect to
the use, maintenance and operation of the Property; provided, however, that all
such rules and regulations shall be reasonable and equitable, consistent with
119
the provisions of this Agreement and each Co-Tenant is given as much advance
written notice thereof as is reasonably practical. Should there be a conflict
between the rules and regulations and the provisions of this Agreement, the
provisions of this Agreement shall govern.
5.20. POWER OF ATTORNEY
Each of the Co-Tenants hereby constitutes, appoints and grants to the
Managing Co-Tenant an irrevocable power of attorney, coupled with an interest,
to execute any subleases, contracts and other instruments which Managing
Co-Tenant is authorized to execute on behalf of the Co-Tenants in accordance
with this Agreement.
5.21 RECORDING OF EXISTING LEASEHOLD MORTGAGE.
Amexco has the right at its option and its cost and expense at any
time to cause the Existing Leasehold Mortgages to be recorded and to cause to
be filed related financing statements and any other related documentation
required in connection therewith, and the Lehman Co-Tenants will execute any
such required financing statements and related documents.
120
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto effective as of the date first set forth above.
AMERICAN EXPRESS COMPANY
By:
---------------------------
Title:
AMERICAN EXPRESS BANK LTD.
By:
---------------------------
Title:
AMERICAN EXPRESS TRAVEL
RELATED SERVICES COMPANY, INC.
By:
---------------------------
Title:
LEHMAN BROTHERS INC.
By:
---------------------------
Title:
LEHMAN GOVERNMENT
SECURITIES, INC.
By:
---------------------------
Title:
LEHMAN COMMERCIAL
PAPER INCORPORATED
By:
---------------------------
Title:
121
COUNTY OF NEW YORK)
: ss.:
STATE OF NEW YORK )
On this ____ day of , 1994, before me came
____________________________ to me known, who being by me duly sworn did depose
and say that _he resides at _________________________________________, that
_he is the _______________________________________________ of AMERICAN EXPRESS
COMPANY, one of the CO-TENANTS described in and which executed the foregoing
instrument; and that _he signed h__ name hereto by order of the Board of
Directors of said corporation.
________________________________
Notary Public
122
COUNTY OF NEW YORK)
: ss.:
STATE OF NEW YORK )
On this ____ day of , 1994, before me came
____________________________ to me known, who being by me duly sworn did depose
and say that _he resides at _________________________________________, that
_he is the _______________________________________________ of AMERICAN EXPRESS
BANK LTD., one of the CO-TENANTS described in and which executed the foregoing
instrument; and that _he signed h__ name hereto by order of the Board of
Directors of said corporation.
________________________________
Notary Public
123
COUNTY OF NEW YORK)
: ss.:
STATE OF NEW YORK )
On this ____ day of , 1994, before me came
____________________________ to me known, who being by me duly sworn did depose
and say that _he resides at _________________________________________, that
_he is the _______________________________________________ of AMERICAN EXPRESS
TRAVEL RELATED SERVICES COMPANY, INC., one of the CO-TENANTS described in and
which executed the foregoing instrument; and that _he signed h__ name hereto
by order of the Board of Directors of said corporation.
________________________________
Notary Public
124
COUNTY OF NEW YORK)
: ss.:
STATE OF NEW YORK )
On this ____ day of , 1994, before me came
____________________________ to me known, who being by me duly sworn did depose
and say that _he resides at _________________________________________, that
_he is the _______________________________________________ of LEHMAN BROTHERS
INC., one of the CO-TENANTS described in and which executed the foregoing
instrument; and that _he signed h__ name hereto by order of the Board of
Directors of said corporation.
_________________________________
Notary Public
125
COUNTY OF NEW YORK)
: ss.:
STATE OF NEW YORK )
On this ____ day of , 1994, before me came
____________________________ to me known, who being by me duly sworn did depose
and say that _he resides at _________________________________________, that
_he is the _______________________________________________ of LEHMAN GOVERNMENT
SECURITIES, INC., one of the CO-TENANTS described in and which executed the
foregoing instrument; and that _he signed h__ name hereto by order of the
Board of Directors of said corporation.
_________________________________
Notary Public
126
COUNTY OF NEW YORK)
: ss.:
STATE OF NEW YORK )
On this ____ day of , 1994, before me came
____________________________ to me known, who being by me duly sworn did depose
and say that _he resides at _________________________________________, that
_he is the _______________________________________________ of LEHMAN COMMERCIAL
PAPER INCORPORATED, one of the CO-TENANTS described in and which executed the
foregoing instrument; and that _he signed h__ name hereto by order of the Board
of Directors of said corporation.
_________________________________
Notary Public
127
EXHIBIT A
DESCRIPTION OF LAND
Street lines noted in the descriptions of Parcel C, Easement no. 12, Easement
no. 13, Easement no. 14, Easement no. 15A, Easement no. 15B, part of Vesey
Street and part of North End Avenue are in accordance with map being prepared
by New York City, said map has not been adopted by the Board of Estimate as
yet. Street lines noted in the description of Easement no. 9 are in accordance
with Map No. ACC. 30071 adopted by the New York City Board of Estimate on
November 13, 1981.
Elevations refer to datum used by the Topographical Bureau, Borough of
Manhattan which is 2.75 feet above datum used by the United States Coast and
Geodetic survey, mean sea level, Sandy Hook, New Jersey.
Bearings noted herein are in the system used on the Borough Survey, President's
office, Manhattan.
The following description is based upon the information shown on the Easement
Plan.
Parcel C
All that certain plot, piece of parcel of land situate, lying and being in the
City, County and State of New York, described as follows:
BEGINNING at the intersection of the southerly line of Vesey Street with the
westerly line of Marginal Street, Wharf or Place and The United States Bulkhead
Line approved by The Secretary of War, July 31, 1941:
The following 3 courses run along the westerly line of Marginal Street, Wharf
or Place and The United States Bulkhead Line approved by The Secretary of War,
July 31, 1941:
1. Running thence south 18o-34'-07" east, 46.78 feet;
2. thence south 18o-49'-40" east, 187.30 feet;
3. thence south 18o-59'-34" east, 41.09 feet;
4. thence south 77o-31'-29" west, 92.15 feet;
- 1 -
5. thence south 12o-28'-31" east, 51.54 feet;
6. thence south 77o-08'-34" west, 22.36 feet;
7. thence northwesterly, curving to the left, on the arc of a circle
whose radial line bears south 77o-08'-34" west, having a radius of
56.08 feet and a
- 2 -
central angle of 77o-08'-34" west, 75.51 feet to a point of tangency;
8. thence due west, 21.42 feet;
9. thence due north, 10.00 feet;
10. thence due west, 45.00 feet;
11. thence due north, 10.00 feet;
12. thence due west, 81.16 feet;
13. thence due south, 22.00 feet;
14. thence due west, 20.92 feet;
15. thence due north, 212.41 feet;
16. thence due west, 15.00 feet;
17. thence due north, 89.88 feet to the southerly line of Vesey Street;
18. thence south 88o-07'-10" east along the southerly line of Vesey Street
250.24 feet to the point or place of BEGINNING.
The following five descriptions are based upon the information shown on the
Parcel Lines Easement Plan.
Together with the following exclusive easements, on the terms and subject to
the conditions set forth with respect thereto in Section 41.07 of the Lease.
EASEMENT NO. 12
GROUND FLOOR RETAIL AREA
All that portion of the parcel below described lying between a lower horizontal
plane drawn at elevation 12.50 feet and an upper horizontal plane drawn at
elevation 31.00 feet bounded and described as follows:
BEGINNING at a point 133.09 feet, as measured along the southerly line of Vesey
Street, west of the intersection of the westerly line of Marginal Street, Wharf
or Place and The United States Bulkhead Line approved by the Secretary of War,
July 31, 1941,
- 3 -
with the southerly line of Vesey Street and 276.45 feet, as measured along a
line bearing due south, south of the southerly line of Vesey Street;
1. Running thence due south, 10.00 feet;
2. thence due east, 45.00 feet;
3. thence due south, 12.08 feet;
4. thence due west, 47.08 feet;
5. thence due north, 10.00 feet;
6. thence due west, 67.50 feet;
7. thence due north, 12.08 feet;
8. thence due east, 69.58 feet to the point or place of BEGINNING.
EASEMENT NO. 13
SECOND FLOOR BALCONY AREA
All that portion of the parcel below described lying between a lower horizontal
plane drawn at elevation 31.00 feet and an upper horizontal plane drawn at
elevation 52.00 feet bounded and described as follows:
BEGINNING at a point 133.09 feet, as measured along the southerly line of Vesey
Street, west of the intersection of the westerly line of Marginal Street, Wharf
or Place and The United States Bulkhead Line approved by The Secretary of War,
July 31, 1941, with the southerly line of Vesey Street and 276.45 feet, as
measured along a line bearing due south, south of the southerly line of Vesey
Street;
1. Running thence due south, 10.00 feet;
2. thence due east, 45.00 feet;
3. thence due south 12.08 feet;
4. thence due west, 47.08 feet;
5. thence due north, 10.00 feet;
- 4 -
6. thence due west, 67.50 feet;
7. thence due north, 12.08 feet;
8. thence due east, 69.58 feet to the point or place of BEGINNING.
EASEMENT NO. 14
NORTH COURTYARD WING MECHANICAL AREA
All that portion of the parcel below described lying between a lower horizontal
plane drawn at elevation 54.00 feet and an upper horizontal plane drawn at
elevation 65.75 feet bounded and described as follows:
BEGINNING at a point 250.24 feet, as measured along the southerly line of Vesey
Street, west of the intersection of the westerly line of Marginal Street, Wharf
or Place and The United States Bulkhead Line approved by The Secretary of War,
July 31, 1941, with the southerly line of Vesey Street and 45.88 feet, as
measured along a line bearing due south, south of the southerly line of Vesey
Street;
1. Running thence due south, 44.00 feet;
2. thence due west, 26.50 feet;
3. thence due north, 44.50 feet;
4. thence due east, 26.50 feet to the point or place of BEGINNING.
EASEMENT NO. 15A
SOUTH COURTYARD WING MECHANICAL AREA
All that portion of the parcel below described lying between a lower horizontal
plane drawn at elevation 53.00 feet and an upper horizontal plane drawn at
elevation 65.75 feet bounded and described as follows:
BEGINNING at a point 235.23 feet, as measured along the southerly line of Vesey
Street, west of the intersection of the westerly line of Marginal Street, Wharf
or Place and The United States Bulkhead Line approved by The Secretary of War,
July 31, 1941 with the southerly line of Vesey Street and 202.38 feet, as
measured along a line bearing due south, south of the southerly line of Vesey
Street;
- 5 -
1. Running thence due south, 66.00 feet;
2. thence due west, 11.50 feet;
3. thence due north, 66.00 feet;
4. thence due east, 11.50 feet to the point or place of BEGINNING.
EASEMENT NO. 15B
SOUTH COURTYARD WING MECHANICAL AREA
All that portion of the parcel below described lying between a lower horizontal
plane drawn at elevation 54.00 feet and an upper horizontal plane drawn at
elevation 65.75 feet bounded and described as follows:
BEGINNING at a point 291.76 feet, as measured along the southerly line of Vesey
Street, west of the intersection of the westerly line of Marginal Street, Wharf
or Place and The United States Bulkhead Line approved by The Secretary of War,
July 31, 1941, with the southerly line of Vesey Street and 204.24 feet, as
measured along a line bearing due south, south of the southerly line of Vesey
Street.
1. Running thence due east, 45.00 feet;
2. thence due south, 66.00 feet;
3. thence due west, 28.00 feet;
4. thence due south, 2.00 feet;
5. thence due west, 17.00 feet;
6. thence due north, 68.00 feet to the point or place of BEGINNING.
The following seven descriptions are based upon the information shown on the
Easement Plan.
Together with the following nonexclusive easements, on the terms and subject to
the conditions set forth with respect thereto in Section 41.07 of the Lease.
EASEMENT NO. 9
VEHICULAR ACCESS
- 6 -
All that portion of the parcel below described lying between a lower horizontal
plane drawn at elevation -50.0 feet and an upper horizontal plane drawn at
elevation 29.5 feet bounded and described as follows:
BEGINNING at a point in the northerly line of Liberty Street, distant 216.96
feet westerly from the intersection of the northerly line of Liberty Street
with the westerly line of Marginal Street, Wharf or Place and The United States
Bulkhead Line approved by the Secretary of War, July 31, 1941;
1. Running thence due west, along the northerly
line of Liberty Street, 92.18 feet;
2. thence north 12o-28'-31" west, 105.56 feet;
3. thence north 73o-04'-45" east, 90.27 feet;
4. thence south 12o-28'-31" east, 132.47 feet to the point or place of
BEGINNING.
EASEMENT NO. 11
TURNING CIRCLE AREA
All that portion of the parcel below described lying between a lower horizontal
plane drawn at elevation -50.0 feet and an upper horizontal plane drawn at
elevation 29.5 feet bounded and described as follows:
BEGINNING at a coordinate north 4370.933, west 10580.253;
1. Running thence north 12o-28'-31" west, 55.48 feet;
2. thence southeasterly, curving to the right on the arc of a circle
whose radical line bears south 51o-43'-54" west, having a radius of
63.75 feet and a central angle of 51o-35'-11", 57.40 feet to the point
or place of BEGINNING.
PART OF VESEY STREET
BEGINNING at the intersection of the southerly line of Vesey Street and the
westerly line of Marginal Street, Wharf or Place and The United States Bulkhead
Line approved by The Secretary of War, July 31, 1941:
- 7 -
1. Running thence north 88o-07'-10" west, along the southerly line of
Vesey Street, 693.61 feet;
2. thence north 1o-52'-50" east, 100.00 feet, to the northerly line of
Vesey Street;
3. thence south 88o-07'-10" east, along the northerly line of Vesey
Street, 655.68 feet, to the westerly line of Marginal Street, Wharf or
Place and The United States Bulkhead Line approved by The Secretary of
War, July 31, 1941;
4. thence south 18o-56'-00" east, along the westerly line of Marginal
Street, Wharf or Place and The United States Bulkhead Line approved by
The Secretary of War, July 31, 1941, 94.24 feet to an angle point
therein;
5. thence south 18o-34'-07" east, still along the westerly line of
Marginal Street, Wharf or Place and The United States Bulkhead Line
approved by The Secretary of War, July 31, 1941, 12.71 feet to the
point or place of BEGINNING.
PART OF NORTH END AVENUE
BEGINNING at the intersection of the southerly line of Vesey Street and the
easterly line of North End Avenue:
1. Running thence south 1o-52'-50" west, along the easterly line of North
End Avenue, 355.00 feet, to the southerly line of North End Avenue;
2. thence north 88o-07'-10" west, along the southerly line of North End
Avenue, 100.00 feet, to the westerly line of North End Avenue;
3. thence north 1o-52'-50" east, along the westerly line of North End
Avenue, 355.00 feet, to the northerly line of North End Avenue which
is coincident with a portion of the southerly line of Vesey Street;
4. thence south 88o-07'-10" east, along the northerly line of North End
Avenue which is coincident with a portion of the southerly line of
Vesey Street, 100.00 feet, to the point or place of BEGINNING.
- 8 -
PLAZA
Line of Liberty Street is in accordance with Map No. ACC. 30071 adopted by the
New York City Board of Estimate, November 13, 1981.
Line of North End Avenue is in accordance with map being prepared by New York
City, said map has not been adopted by the Board of Estimate as yet.
BEGINNING at a point in the northerly line of Liberty Street distant 216.96
feet westerly from the intersection of the northerly line of Liberty Street
with the westerly line of Marginal Street, Wharf or Place and The United States
Bulkhead Line approved by The Secretary of War, July 31, 1941:
1. Running thence due west, along the northerly line of Liberty Street,
412.64 feet;
2. thence north 73o-04'-45" east, 78.82 feet;
3. thence north 18o-36'-20" west, 463.95 feet;
4. thence south 71o-07'-33" west, 194.68 feet to a point of curvature;
5. thence westerly, on a curve to the right having a radius of 1880.08
feet, a central angle of 3o-01'-26" and a distance of 99.23 feet;
6. thence north 1o-52'-50" east, 143.14 feet;
7. thence south 88o-07'-10" east, along the southerly line of North End
Avenue, 100.00 feet;
8. thence north 1o-52'-50" east, along the easterly line of North End
Avenue, 61.29 feet;
9. thence due east, 354.87 feet;
10. thence due south, 343.47 feet;
11. thence due east, 72.58 feet;
12. thence south 12o-28'-31" east, 108.28 feet;
13. thence north 77o-31'-29": east, 86.50 feet;
- 9 -
14. thence south 16o-55'-15" east, 38.01 feet;
15. thence north 73o-04'-45" east, 86.27 feet
16. thence south 12o-28'-31" east, 132.47 feet to the point or place of
BEGINNING.
NORTHERN PEDESTRIAN BRIDGE
As shown on Map N. ACC. 30079 adopted by the New York City Board of Estimate,
December 16, 1982.
SOUTHERN PEDESTRIAN BRIDGE
As shown on Map No. ACC. 30071 adopted by the New York City Board of Estimate,
November 13, 1981.
- 10 -
EXHIBIT B
[SPACE SCHEDULE]
EXHIBIT C
[COMMON FACILITIES]
EXHIBIT D
[EMPLOYEE ASSISTANCE PROGRAM SERVICES]
EXHIBIT E
[SUPPLEMENTAL EMPLOYEE ASSISTANCE
PROGRAM SERVICES]
EXHIBIT F
SECURED AREAS
Entire Nineteenth (19th) Floor
EXHIBIT G
AMERICAN EXPRESS TOWER
FORM OF BUDGET
BUDGET CATEGORIES
Bldg. Mgt. Force
Bldg. Mgt. Force-Benefits
Electricity
Chilled Water
Steam
Oil/Gas
Water
Contract Cleaning-National
Window Cleaning
Carpet Cleaning
Wood Floor Cleaning
Fabric Wall Cleaning
Contract Cleaning-Special Cleaning
Rubbish Removal
Maintenance & Repairs
Maintenance Agreements
Freight & Transportation
Other Svc's & Sup.-Bldg. Sup.
Other Svc's & Sup.-(BUNN)
Telephone
Legal Fees
Consultant Fees
Mgt. Fee (C&W)
Other Professional Services
Co-Mgt. Expenses
Outside Security-Special Security
Other Operating Exps.
Occupancy Taxes
Insurance
TRS Security
TRS Security-Equipment Maintenance
EXHIBIT H
FITNESS CENTER SERVICES
EXHIBIT I
MEDICAL DEPARTMENT SERVICES
EXHIBIT J
[Designated Locations for Lehman
Messenger Messenger Center
and Lehman Incoming Delivery
Station]
Dates Referenced Herein and Documents Incorporated by Reference
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