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29 <br />4859-3312-3005v4 <br />Section 10.4 Apportionment of Award. If there is a Taking, whether whole or partial, <br />Lessor and Lessee shall be entitled to receive and retain such separate awards and portions of <br />lump sum awards as may be allocated to their respective interests in any condemnation <br />proceedings, or as may be otherwise agreed, taking into consideration Lessor’s fee interest in the <br />Land (as encumbered by this Lease) and reversionary interest in the Improvements upon the <br />expiration of the Term or termination of this Lease. If the Leased Premises are restored as is <br />contemplated in Section 10.2 above, Lessee shall be entitled to pay the costs and expenses <br />reasonably incurred in such restoration out of any Net Condemnation Award payable to Lessee. <br />Thereafter, if the condemning authority does not make separate awards, the Parties agree that any <br />Net Condemnation Award will be allocated as follows on a proportionate basis reflecting the <br />Parties’ respective interests in the Land and Improvements and the remaining duration of the <br />Term as follows: <br />(A) Award on Total or Substantial Taking. In the event of a total or substantial <br />taking, the award shall be apportioned as follows, in the following order: <br />(a) To the Lenders in an amount equal to the indebtedness then owed to such <br />Lenders in order of the Lien priority of the Leasehold Mortgages <br />(b) To Lessor that portion of the award equal to the fair market value of the <br />Land. <br />(c) To Lessee, that portion of the award equal to the fair market value of the <br />Improvements (subject to Lessor’s reversionary interest), less the amount paid to the <br />Lenders pursuant to (a) above. <br />(d) Any “bonus value” (i.e., any portion of the award attributable to the fact <br />that the rent payable by Lessee under this Lease is at a below market rate) shall be paid to <br />Lessor; provided however, if the condemning agency is Lessor, any such “bonus value” <br />shall be equally divided between Lessor and Lessee. <br />(e) The balance, if any, shall be allocated between Lessor and Lessee <br />respectively in that proportion in which (i) the fair market value of the Land bears to (ii) <br />the fair market value of the Improvements, exclusive of Lessor’s reversionary interest. <br />(B) Award on Partial Taking. In the event of a partial taking, after application of the <br />Award for restoration, any remaining portion of such award shall be apportioned as follows, in <br />the following order: <br /> (a) To the Lenders in an amount equal to the indebtedness then owed to such <br />Lenders in order of the Lien priority of the Leasehold Mortgages . <br />(b) To Lessor, that portion of the award attributable to the fair market value of <br />the portion of the Land taken. <br />(c) To Lessee, that portion of the award equal to the fair market value of the <br />portion of the Improvements taken (subject to Lessor’s reversionary interest), less the <br />Page 109 of 428