LEASE AND DEVELOPMENT AGREEMENT
THE PORT AUTHORITY OF NEW YORK
AND NEW JERSEY
TABLE OF CONTENTS
ARTICLE 1. DEFINITIONS 5
ARTICLE 2. LETTING - LEASEHOLD ESTATE 15
ARTICLE 3. TERM OF LETTING AND PERMITTED USE 17
ARTICLE 4. RENTAL 19
ARTICLE 4A. SECURITY DEPOSIT 25
ARTICLE 5. CONSTRUCTION 28
ARTICLE 6. SERVICES AND UTILITIES 58
ARTICLE 7. LESSEE’S MOA OBLIGATIONS 65
ARTICLE 8. LESSEE’S OPERATIONS 67
ARTICLE 9. MAINTENANCE AND REPAIR 70
ARTICLE 10. INSURANCE 72
ARTICLE 11. CASUALTY 77
ARTICLE 12. INDEMNITY 80
ARTICLE 13. RIGHT TO PERFORM COVENANTS 82
ARTICLE 14. ASSIGNMENT, TRANSFER, MORTGAGE AND SUBLETTING 83
ARTICLE 14A. PERMITTED MORTGAGES 90
ARTICLE 15. LANDLORD’S PARTICIPATION IN PROCEEDS 101
ARTICLE 16. RIGHTS OF ENTRY 108
ARTICLE 17. TERMINATION 109
ARTICLE 18. SURRENDER 115
ARTICLE 19. CONDEMNATION 116
ARTICLE 19A. EFFECT OF BASIC LEASE 119
ARTICLE 20. COMPLIANCE WITH LAWS AND RULES AND REGULATIONS 120
ARTICLE 20A. JOINT PERIODIC CONDITION SURVEY 121
ARTICLE 20B. ENVIRONMENTAL OBLIGATIONS 125
ARTICLE 20C. STORAGE TANKS 138
ARTICLE 21. LABOR HARMONY, AFFIRMATIVE ACTION 142
ARTICLE 22. LESSEE’S REPRESENTATIONS 153
ARTICLE 23. PAYMENTS; RECORDKEEPING AND AUDITS 155
ARTICLE 24. NOTICES 158
ARTICLE 25. INTELLECTUAL PROPERTY RIGHTS; USE OF NAMES 159
ARTICLE 26. MISCELLANEOUS 161
Exhibit A Premises
Exhibit B MOA
Exhibit C Line-of-sight Height Limitations
Exhibit D Central Terminal Area
Exhibit E Hotel Management Agreement
Exhibit F Conceptual Drawings
Exhibit G Initial Environmental Report
Exhibit H Form of Memorandum of Lease
Exhibit O Lessee’s Ownership Structure
Schedule _ [Management Fees, etc.]
Schedule E Affirmative Action – Equal Opportunity – Minority Business Enterprises - Women-owned Business Enterprises Requirements
Schedule F Local Business Enterprises Commitment
Schedule G Airport Concession Disadvantaged Business Enterprise (ACDBE) Participation
LEASE AND DEVELOPMENT AGREEMENT
This LEASE AND DEVELOPMENT AGREEMENT is made as of the day of 2014, by and between THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY (the “Port Authority”), a body corporate and politic created by Compact between the States of New York and New Jersey with the consent of the Congress of the United States of America and having its office at 225 Park Avenue South, 15th Floor, New York, New York 10003, whose representative is the Executive Director of the Port Authority, and [LESSEE] (the “Lessee”), a limited liability company organized and existing under the laws of Delaware and having an office and place of business at , whose representative is , its .
1. The Port Authority is the ground lessee, pursuant to the Basic Lease, of the Airport, including the Premises.
2. The TWA Flight Center, designed in the late 1950’s by renowned architect Eero Saarinen and opened in 1962 as the Trans World Airlines air terminal, is situated in the Premises. The TWA Flight Center has been designated a New York City landmark and is listed on the National and New York State Registers of Historic Places.
3. Air terminal operations ceased at the TWA Flight Center in 2001. In 2004 the Port Authority, the New York State Historic Preservation Office (“SHPO”), the FAA and the Advisory Council on Historic Preservation entered into a Memorandum of Agreement (the “MOA”), a copy of which is attached as Exhibit B, setting forth various stipulations relating to the rehabilitation, restoration and adaptive reuse of the TWA Flight Center.
4. The MOA provides, inter alia, that final design plans for the restoration, rehabilitation and adaptive reuse of the TWA Flight Center are to be submitted to SHPO for comment, and that the Port Authority, in consultation with SHPO, is to assure that the TWA Flight Center is restored and rehabilitated by the “adaptive reuse developer” in accordance with the Secretary of Interior Standards for the Treatment of Historical Properties.
5. The Port Authority has issued Request for Proposals #38826 (the “RFP”), seeking proposals for a “creative and innovative hotel development” at the Premises that would respect and enhance the historic significance of the TWA Flight Center “as an international icon of visionary architecture”.
6. A development team affiliated with the Lessee responded to the RFP with a proposal (the “Lessee Team Proposal”) for the development at the Premises of a “[X Brand} Hotel”, an upscale hotel targeted to a diverse clientele, with food, beverage, meeting, event, spa, retail and cultural space, all managed and operated by . The Lessee Team Proposal contemplated the restoration of the public spaces, such as restaurants and lobby areas, to their original appearance and function, or as otherwise shown in the approved development plans, and [ ].
7. The Port Authority has already performed substantial rehabilitation and restoration work on the interior and exterior portions of the TWA Flight Center.
8. The Port Authority has engaged in an extensive program of modernization and redevelopment of the Airport, including the construction of new air terminals, reconfigured roadways and other major infrastructure improvements.
9. The Premises are located in the Central Terminal Area of the Airport, and Port Authority desires the redeveloped TWA Flight Center to provide upscale services and amenities consistent with the redeveloped Airport, to serve the users of the Airport and the surrounding community.
10. Based on the Lessee Team Proposal, which incorporates the requirements of the RFP, the Port Authority has selected the Lessee to redevelop and operate the Premises, and for that purpose the Parties desire to enter into this Agreement.
Terms of Agreement
In consideration of the covenants and mutual agreements herein contained, the Port Authority and the Lessee hereby covenant and agree as follows: