PRO-LANDLORD TENANT BANKRUPTCY LEASE EXHIBIT
EXHIBIT [INSERT APPLICABLE LETTER]
TENANT'S BANKRUPTCY LEASE EXHIBIT (INCLUDING USC 365 ISSUES)
In the event of Tenant's Bankruptcy, Landlord at its option may, in addition to all other rights and remedies provided in the Lease at law or in equity, terminate this Lease by giving written notice to Tenant. If termination of this Lease shall be stayed by order of any court having jurisdiction over any bankruptcy or insolvency proceeding or by federal or state statute, then, following the expiration of any such stay, or if Tenant or Tenant as debtor-in-possession or the trustee appointed in any such proceeding (being collectively referred to as “Tenant” only for the purposes of this Exhibit) shall fail to assume Tenant's obligations under this Lease within the period prescribed therefor by law or within fifteen (15) days after entry of the order for relief or as may be allowed by the court, or if Tenant shall fail to provide adequate protection of Landlord's right, title and interest in and to the Demised Premises or adequate assurance of the complete and continuous future performance of Tenant's obligation under this Lease, Landlord, to the extent permitted by law or by leave of the court having jurisdiction over such proceeding, shall have the right, at its election, to terminate this Lease on fifteen (15) days' notice to Tenant and upon the expiration of said fifteen (15) day period this Lease shall cease and expire as aforesaid and Tenant shall immediately quit and surrender the Demised Premises as aforesaid. Upon the termination of this Lease as provided above, Landlord, without notice, may re-enter and repossess the Demised Premises using such force for that purpose as may be necessary without being liable to indictment, prosecution or damages therefor and may dispossess Tenant by summary proceedings or otherwise. For the purposes of this Lease, adequate protection of Landlord's right, title and interest in and to the Demised Premises, and adequate assurance of the complete and continuous future performance of Tenant's obligations under this Lease, shall include, without limitation, the following requirements:
1. that Tenant comply with all of its obligations under this Lease, including, without limitation that:
(a) Tenant pay to Landlord, on the first day of each month occurring subsequent to the entry of such order, or the effective date of such stay, a sum equal to the amount by which the Demised Premises diminished in value during the immediately preceding monthly period, but, in no event, shall such amount be less than the aggregate Base Annual Rent, Common Area Expenses and Additional Charges payable for such monthly period;
(b) Tenant continue to use the Demised Premises in the manner originally required by the Lease;
(c) Landlord be permitted to supervise the performance of Tenant's obligations under this Lease;
(d) Tenant pay to Landlord within fifteen (15) days after entry of such order or the effective date of such stay, as partial adequate protection against future diminution in value of the Demised Premises and adequate assurance of the complete and continuous future performance of Tenant's obligations under this Lease, an additional security deposit in an amount acceptable to Landlord;
(e) Tenant has and will continue to have unencumbered assets after the payment of all secured obligations and administrative expenses to assure Landlord that sufficient funds will be available to fulfill the obligations of Tenant under this Lease;
(f) if Tenant assumes this Lease and proposes to assign the same (pursuant to Title 11 U.S.C. 365, or as the same may be amended) to any person who shall have made a bona fide offer to accept an assignment of this Lease on terms acceptable to such court having competent jurisdiction over Tenant's estate, then notice of such proposed assignment, setting forth (i) the name and address of such person, (ii) all of the terms and conditions of such offer, and (iii) the adequate assurance to be provided Landlord to assure such person's future performance under this Lease, including, without limitation, the assurances referred to in Title 11 U.S.C. 365(b)(3), as it may be amended, shall be given to Landlord by Tenant no later than fifteen (15) days after receipt by Tenant of such offer, but in any event no later than thirty (30) days prior to the date that Tenant shall make application to such court for authority and approval to enter into such assignment and assumption, and Landlord shall thereupon have the prior right and option, to be exercised by notice to Tenant given at any time prior to the effective date of such proposed assignment, to accept, or to cause Landlord's designee to accept, an assignment of this Lease upon the same terms and conditions and for the same consideration, if any, as the bona fide offer made by such person less any brokerage commissions which may be payable out of the consideration to be paid by such person for the assignment of this Lease; and
(g) if Tenant assumes this Lease and proposes to assign the same, and Landlord does not exercise its option as provided in subparagraph (f) hereinabove, Tenant hereby agrees that:
(1) such assignee shall have a net worth not less that the net worth of Tenant as of the Commencement Date, or such Tenant's obligations under this Lease shall be unconditionally guaranteed by a person having a net worth equal to Tenant's net worth as of the Commencement Date;
(2) such assignee shall not use the Demised Premises except subject to all the restrictions contained in this Lease;
(3) such assignee shall assume in writing all of the terms, covenants and conditions of this Lease including, without limitation, all of such terms, covenants and conditions respecting the Permitted Use and payment of Base Annual Rent, Common Area Expenses and Additional Charges, and such assignee shall provide Landlord with assurances satisfactory to Landlord that it has the experience in operating such business having the same or substantially similar uses as the Permitted Use, in first-class office buildings, sufficient to enable it so to comply with the terms, covenants and conditions of this Lease and successfully operate the Demised Premises for the Permitted Use;
(4) such assignee shall indemnify Landlord against, and pay to Landlord the amount of, any payments which may be obligated to be made to any “Mortgagee” (as hereinafter defined) by virtue of such assignment;
(5) such assignee shall pay to Landlord an amount equal to the unamortized portion of any construction allowance made to Tenant; and
(6) if such assignee makes any payment to Tenant, or for Tenant's account, for the right to assume this Lease (including, without limitation, any lump sum payment, installment payment or payment in the nature of rent over and above the Base Annual Rent, Common Area Expenses and Additional Charges payable under this Lease), Tenant shall pay over to Landlord one-half of any such payment, less any amount paid to Landlord pursuant to clause (V) above on account of any construction allowance.
2. As a material inducement to Landlord executing this Lease, Tenant acknowledges and agrees that Landlord is relying upon (i) the financial condition and specific operating experience of Tenant and Tenant's obligation to use the Demised Premises specifically in accordance with this Lease, (ii) Tenant's timely performance of all of its obligations under this Lease notwithstanding the entry of an order for relief under the Bankruptcy Code or the Insolvency Laws for Tenant and (iii) all defaults under the Lease being cured promptly and the Lease being assumed within 60 days of any order for relief entered under the Bankruptcy Code or the Insolvency Laws for Tenant, or the Lease being rejected within such 60-day period and the Demised Premises surrendered to Landlord. Accordingly, in consideration of the mutual covenants contained in this Lease and for other good and valuable consideration, Tenant hereby agrees that:
(a) All obligations that accrue under this Lease (including, but not limited to Tenant's obligation to pay rent), from and after the date that a petition is filed or other action is commenced under the Bankruptcy Code or the Insolvency Laws (an “Action”) shall be timely performed exactly as provided in this Lease and any failure to so perform shall be harmful and prejudicial to Landlord;
(b) any and all rents that accrue from and after the date that an Action is commenced and that are not paid as required by this Lease shall, in the amount of such rents, constitute administrative expense claims allowable under the Bankruptcy Code with priority of payment at least equal to that of any other actual and necessary expenses incurred after the commencement of the Action;
(c) any extension of the time period within which Tenant may assume or reject the Lease without an obligation to cause all obligations under the Lease to be performed as and when required under the Lease shall be harmful and prejudicial to Landlord;
(d) any time period designated as the period within which Tenant must cure all defaults and compensate Landlord for all pecuniary losses that extends beyond the date of assumption of the Lease shall be harmful and prejudicial to Landlord;
(e) any assignment of the Lease must result in all terms and conditions of the Lease being assumed by the assignee without alteration or amendment, and any assignment that results in an amendment or alteration of the terms and conditions of the Lease without the express written consent of Landlord shall be harmful and prejudicial to Landlord;
(f) any proposed assignment of the Lease to an assignee: (i) that will not use the Demised Premises specifically in accordance with the Lease, (ii) that does not possess financial condition, operating performance and experience characteristics equal to or better than the financial condition, operating performance and experience of Tenant as of the date of this Lease, or (iii) that does not provide guarantors of the Lease obligations with financial condition equal to or better than the financial condition of the original guarantors of the Lease as of the date of this Lease, shall be harmful and prejudicial to Landlord;
(g) the rejection (or deemed rejection) of the Lease for any reason whatsoever shall constitute cause for immediate relief from the automatic stay provisions of the Bankruptcy Code, and Tenant stipulates that such automatic stay shall be lifted immediately and possession of the Demised Premises will be delivered to Landlord immediately without the necessity of any further action by Landlord.
3. No provision of this Lease shall be deemed a waiver of Landlord's rights or remedies under the Bankruptcy Code, the Insolvency Laws, or applicable law to oppose any assumption and/or assignment of this Lease, to require timely performance of Tenant's obligations under this Lease, or to regain possession of the Demised Premises as a result of the failure of Tenant to comply with the terms and conditions of this Lease or the Bankruptcy Code.
4. Notwithstanding anything in this Lease to the contrary, all amounts payable by Tenant to or on behalf of Landlord under this Lease, whether or not expressly denominated as such, shall constitute “rent” for purposes of the Bankruptcy Code.
5. For purposes of this Exhibit addressing the rights and obligations of Landlord and Tenant in the event that an Action is commenced, the term “Tenant” shall include Tenant's successor in bankruptcy, whether a trustee, Tenant as debtor in possession or other responsible person. The term “Mortgagee” as used herein shall mean any party or parties (including, but not limited to lessors, mortgagees, beneficiaries, trustees or note-holders) having the benefit of, (i) any lease of land only or of land and buildings in a sale-leaseback or lease-sub-leaseback transaction involving the Project, Landlord's interest in same or any portion thereof, and/or (ii) any mortgage, deed of trust, deed to secure debt or other security instrument constituting a lien upon the Project Landlord's interest in same or any portion thereof or Landlord's interest therein, whether the same shall be in existence at the date hereof or created hereafter.
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