Exhibit 10.23
LEASE AGREEMENT between
THE HAVERDYNE COMPANY, LLC
("Landlord")
and
QUALTRON, INC.
("Tenant")
ARTICLE 1 TERM
ARTICLE 2 FIXED RENT, ADDITIONAL RENT & DEPOSIT
ARTICLE 3 ADJUSTMENTS TO FIXED RENT
ARTICLE 4 TAXES, ASSESSMENTS & CHARGES
ARTICLE 5 INSURANCE
ARTICLE 6 REPAIRS
ARTICLE 7 COMPLIANCE WITH LAW AND REGULATIONS
ARTICLE 8 ALTERATIONS AND IMPROVEMENTS
ARTICLE 9 MECHANICS' LIENS
ARTICLE 10 WASTE
ARTICLE 11 INSPECTION BY LANDLORD
ARTICLE 12 ASSIGNMENT AND SUBLETTING
ARTICLE 13 UTILITIES
ARTICLE 14 HOLD HARMLESS AND INDEMNIFICATION
ARTICLE 15 CASUALTY
ARTICLE 16 CONDEMNATION/EMINENT DOMAIN
ARTICLE 17 BANKRUPTCY/INSOLVENCY AND DEFAULT OF TENANT
ARTICLE 18 NOTICES
ARTICLE 19 LESSER AMOUNT OF RENT
ARTICLE 20 QUIET ENJOYMENT
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ARTICLE 21 LIMITATION OF LANDLORD'S LIABILITY
ARTICLE 22 ESTOPPEL NOTICES
ARTICLE 23 REMEDIES
ARTICLE 24 UNAVOIDABLE DELAYS
ARTICLE 25 SUBORDINATION
ARTICLE 26 NOTICES OF DEFAULT
ARTICLE 27 NOTICE OF LEASE
ARTICLE 28 USE
ARTICLE 29 CONDITION OF PREMISES
ARTICLE 30 LATE CHARGES
ARTICLE 31 MISCELLANEOUS
ARTICLE 32 GUARANTY OF LEASE
ARTICLE 33 WAIVER OF SUBROGATION RIGHTS
ARTICLE 34 SURRENDER OF PREMISES
ARTICLE 35 RESTRICTION OF USE
ARTICLE 36 INVALIDITY OF PROVISIONS
ARTICLE 37 HAZARDOUS SUBSTANCES
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LEASE AGREEMENT
---------------
THIS AGREEMENT, made this 12 day of May, 1998 by and between:
THE HAVERDYNE COMPANY, LLC, a Massachusetts Limited Liability Company, having an
address of XX Xxx 0000, Xxxxxxxxx XX 00000, (hereinafter referred to as
"Landlord"),
and QUALTRON, INC. a corporation organized under the laws of the Commonwealth of
Massachusetts, having an address of Jefferson Office Park, 000 Xxxxxxxx, Xxxxx
000, X. Xxxxxxx, XX 00000 (hereinafter referred to as "Tenant").
WITNESSETH
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THAT Landlord for and in consideration of the rentals and covenants
hereinafter mentioned on the part of Tenant, its successors and assigns, to be
performed, is constructing a 45,000(+/-) square foot building (hereinafter "the
building"), and associated improvements upon a certain parcel of land,
consisting of 4.29 acres (+/-) and shown on the site plan attached to this Lease
(Exhibit "A") situated in Haverhill Massachusetts at 000 Xxxx Xxxx Xxxxxx, which
building, improvements and land are collectively referred to in the lease as the
"PROPERTY", and has leased, and by these presents does Lease, unto Tenant, and
Tenant does hereby take and hire from Landlord upon and subject to the
conditions hereinafter expressed premises consisting of a portion of the
building and improvements now or hereafter erected thereon situated in
Haverhill, Massachusetts which Premises are described as set forth in Exhibit
"A" and shown outlined in red annexed hereto and made a part hereof, which a
portion of the building and improvements, including all permitted improvements,
alterations or additions thereto, is collectively referred to in this Lease as
the "PREMISES".
TO HAVE AND TO HOLD THE PREMISES unto Tenant, its successors and assigns,
for a term of three (3) years commencing on the Commencement Date as provided in
Article 1, infra, and terminating at noon on the day which shall be exactly
three (3) years thereafter.
IT IS FURTHER understood and agreed by and between the parties hereto as
follows:
ARTICLE 1.
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TERM
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The term of this Lease shall be three (3) years commencing on June 15, 1998
(which date is hereinafter referred to as the Commencement Date) and ending at
noon on June 15, 2001. Tenant shall have the option to extend this lease for one
two (2) year period subject to the terms and conditions specified in Article 3.
ARTICLE 2.
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FIXED RENT, ADDITIONAL RENT AND DEPOSIT
---------------------------------------
Tenant covenants to pay to Landlord for each Lease year of the term hereof
a net annual basic rental of (see Rental Schedule attached hereto as Exhibit
"B") ($86,679.60), in equal
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monthly installments of Seven thousand two hundred twenty three and 30/100
($7,223.30), (hereinafter referred to as the "Fixed Rent") as follows: Fixed
Rent shall be payable in advance on the first day of each and every calendar
month of the term hereof (hereinafter sometimes referred to as "Rents Days") in
lawful money of the United States of America at The Haverdyne Company, LLC, XX
Xxx 0000, Xxxxxxxxx, XX 00000 or at such other place as may hereafter be
designated by Landlord. Fixed Rent for any period of less than one month shall
be adjusted pro-rata.
Fixed Rent shall be paid to Landlord, without notice or demand and without
deduction, set-off or other charge therefrom or against the same, except for
such payments as Tenant may make of Landlord's obligations in accordance with
Article 25 hereof, or except as provided in Articles 15 or 16 hereof, so that
this Lease shall yield to Landlord Fixed Rent on a net basis, for and during
each and every Lease year of the term of this Lease.
Tenant shall also pay, monthly in advance, "Additional Rent" consisting of
all taxes, assessments, charges, utility costs, insurance premiums, repair costs
and expenditures of Landlord as set forth in Articles 4, 5, 6, 7, 13 and 17, or
in any other part of this Lease. In the event of Tenant's default in payment,
Landlord shall have (in addition to any remedies granted Landlord hereunder for
Fixed Rent) all legal, equitable or other remedies provided by law for non-
payment of rent.
A total of $27,870.90 representing the first month's and last month's rent
and a security deposit, shall be paid by Tenant to Landlord upon the execution
of this lease.
ARTICLE 3.
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ADJUSTMENTS TO FIXED RENT
-------------------------
The Fixed Rent described above will remain in effect for the first year of
the initial term of this Lease. Commencing with the beginning of the second year
of the Lease Term, the Fixed Rent will be increased by an amount equal to 100%
of the cumulative increase of the Consumer Price Index as published by the
Department of Labor for the Boston, Massachusetts area during the previous year,
or the Base Year. The Base Year in this instance will be established as the
first full year of the Lease Term. The Fixed Rent will be increased in each
subsequent year by an amount equal to 100% of the cumulative increase of the
Consumer Price Index during the previous year, throughout the term of the Lease
or any extensions or options thereof, except as specified below. Once adjusted
as provided herein, Fixed Rent shall not be adjusted again until the following
year.
Tenant has the option to extend the Lease for one two (2) year period. Six
months prior written notice from Tenant is required to exercise the option
period, unless at least sixty (60) days prior to the expiration of the second
year of the term Landlord notifies Tenant in writing of Landlord's need for
additional tenant space, in which case Tenant is required to provide twelve (12)
months prior written notice. If Tenant exercises the option as set forth
herein, the Fixed
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* See Exhibit "B" attached hereto and made a part hereof.
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Rent for the first year of the option period shall be the Fixed Rent in effect
as of the end of the initial term, as adjusted in the manner described in the
paragraph immediately preceding, and the Fixed Rent for the second year shall be
adjusted in like manner.
If publication of the Consumer Price Index shall be discontinued, the
parties hereto shall thereafter accept comparable statistics on the cost of
living in Boston, Massachusetts, as they shall be computed and published by an
agency of the United States or by a responsible financial periodical or
recognized authority then to be selected by the parties hereto or, if the
parties cannot agree upon a selection, by arbitration conducted under the
auspices of the American Arbitration Association. In the event of (1) use of
comparable statistics in place of the Index figure at other than monthly
intervals, there shall be made in the method of computation herein provided for
such revisions as the circumstances may require to carry out the intent of this
Article, and any dispute between the parties as to the making of such adjustment
shall be determined by arbitration conducted under the auspices of the American
Arbitration Association.
ARTICLE 4.
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TAXES, ASSESSMENTS & CHARGES
----------------------------
Tenant shall pay monthly to the Landlord as Additional Rent, a pro-rata
share of all real estate taxes and assessments or substitutes therefore or
supplements, thereto, upon, applicable, attributable or reasonably allocable to
the PREMISES or any part thereof of any tax year or other tax period or partial
tax year or period during the term hereof. Tenant shall also pay to the
Landlord the amount of all assessments, impositions and taxes made, levied or
assessed against or imposed upon any and all property of Tenant.
Upon receipt of each xxxx for, real estate taxes assessed against the
PREMISES, Tenant shall pay all real estate taxes which are assessed or imposed
upon the PREMISES or any part thereof, or become payable during the term of this
Lease. The Tenant shall furnish to the Landlord for its inspection, within
thirty (30) days after the date any amount is payable by the Tenant, as provided
in this Article 4, certified receipts of the appropriate taxing authority or
other proof satisfactory to the Landlord evidencing payment. Without
limitation, Tenant shall also pay as Additional Rent any and all water and sewer
rates, fees, rents and charges, energy charges, other utility charges, sprinkler
standby charges and the like (if any), which shall during the term hereof be
laid, assessed, levied or imposed upon the PREMISES or which may be allocable to
or which become due and payable with respect to the PREMISES of any part
thereof. Tenant shall pay the amount of all utility use charges and energy use
charges directly to the appropriate suppliers thereof and shall, upon demand,
provide Landlord with proof of payment thereof. Tenant shall also pay prior to
the due date thereof the amount of any and all assessments which shall or may be
laid, assessed, levied or imposed upon the PREMISES for public improvements or
benefits commenced or completed during the term hereof and shall, upon demand,
provide Landlord with proof of payment thereof.
All obligations referred to in this Lease shall be pro-rated by the
parties, to account for any fiscal period which does not coincide with the Lease
terms.
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In addition, Landlord shall cooperate with Tenant tax abatement, but all
costs and expenses are to be born by Tenant.
If the PREMISES are not separately taxed or if water and sewer rates, fees,
rents and charges, energy charges, other utility charges, sprinkler standby
charges and the like (if any) are not separately billed for the PREMISES or if
assessments for public improvements or benefits are not separately laid,
assessed, levied or imposed upon the PREMISES, then in any of such events
Landlord shall apportion the taxes, charges or assessments attributable to the
PREMISES on a pro-rata basis, established as 32.95% of such taxes and/or other
amounts payable with respect to the entire Property at the commencement of the
lease term and xxxx the TENANT for such amount. Landlord shall pay such taxes,
utility charges and the like which are not separately taxed or metered to
Tenant, and upon request from Tenant from time to time shall provide to Tenant
evidence of such payment. Landlord shall be entitled to project the annual cost
of any taxes, assessments or charges and to xxxx TENANT monthly for same.
Landlord's good faith projection of any such amounts shall be final and binding
upon Tenant, and Tenant shall pay the amount billed by Landlord within fifteen
(15) days after Landlord sends the xxxx to Tenant. It is intended by this
procedure that, to the fullest extent possible, all taxes, charges or
assessments will be paid by Tenant in advance. The initial projections which
Landlord has been able to make as of the commencement of this lease are set
forth in Exhibit "B", which is attached hereto and made a part hereof. After
the end of each lease year, Landlord shall provide Tenant a summary xxxx for the
prior year and with documentation verifying the actual cost of any projected
items already billed and for those not billed but due from Tenant. Tenant shall
pay the amount billed within thirty (30) days after Landlord sends xxxx to
Tenant. Any amount previously paid by Tenant which is in excess of the actual
cost to Landlord shall be, at Landlord's option, refunded to Tenant or credited
against the next payment of taxes, assessments and charges due from Tenant.
If at any time during the term of this Lease the methods of taxation
prevailing at the execution hereof shall be changed or altered so that in lieu
of or a supplement to or a substitute for the whole or any part of the real
estate taxes or assessment now or from time to time hereafter levied, assessed
or imposed by applicable taxing authorities, there shall be imposed (i) a tax,
assessment, levy, imposition or charge, wholly or partially as a capital levy or
otherwise, on the rents received from the PREMISES, or (ii) a tax, assessment,
levy (including but not limited to any municipal, state or federal levy),
imposition or charge measured by or based in whole or in part upon the PREMISES
and imposed upon Landlord, or (iii) a license fee measured by the rent payable
under this Lease, then all such taxes, assessments, levies, imposition and/or
charges, or the part thereof so measured or based shall be deemed to be included
in the general real estate taxes and assessments payable by Tenant pursuant
hereto, to the extent that such taxes, assessments, levies, impositions and
charges would be payable if the PREMISES were the only property of Landlord
subject thereto, and Tenant shall pay and discharge the same as herein provided
in respect of the payment of general real estate taxes and assessments. Tenant
shall not, however, be obligated to pay any portion of any net income or tax on
the privilege of doing business tax imposed on Landlord. Items payable by
Tenant pursuant to the provisions of this Article are sometimes referred to in
this Lease as "impositions."
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ARTICLE 5.
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INSURANCE
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Section 1. Landlord shall procure and maintain throughout the term of
this Lease the following insurance with respect to the PROPERTY:
(a) comprehensive single limit general public liability insurance against
claims for personal injury, death, or property damage occurring upon, in or
about the PROPERTY, or in or about the adjoining streets, sidewalks,
parking areas and passageways, such insurance to afford protection to the
limit of not less than One Million ($1,000,000.00) Dollars;
(b) casualty and fire insurance policies with full extended coverage provisions
with respect to the PROPERTY in an amount not less than 100% of the
replacement cost of the buildings and improvements therein, but in no event
less than the amount sufficient to avoid the effect of the co-insurance
provisions of the applicable policy or policies; and
(c) if the PROPERTY are in a flood hazard area, flood hazard insurance in the
amount of the full replacement cost of the building thereof or if such
amount of insurance is not obtainable, in the maximum amount which is so
obtainable.
Tenant shall pay, as Additional Rent, the portion of the cost of such
insurance as is attributable to the Premises, as set forth in Section 2 below.
Landlord may, at its option, maintain insurance in addition to the insurance
referred to above (for example, at higher levels), but Tenant shall not be
obligated to pay anything toward the cost of such additional insurance
maintained by Landlord.
Section 2. All policies required under the provisions of Section 1 of
this Article 5 shall name Landlord and Tenant as an insured, and Landlord shall
provide to Tenant evidence of the maintenance of such insurance. Landlord will
xxxx Tenant for tenant's pro rata share of the costs of the insurance set forth
in Section 1 above, namely 32.95% thereof and Tenant shall pay on a monthly
basis one twelfth of such pro-rata share of premiums. It is intended by this
procedure that all insurance costs will be paid by Tenant in advance of the
effective date of the insurance policy in question. After the end of each lease
year, Landlord shall verify to Tenant the actual insurance costs for such year
and any deficiency or overage shall be paid by Tenant, or credited to Tenant, in
the manner of the year-end reconciliation of taxes provided in Article 4 above.
Section 3. Neither Landlord, its servants, agents or employees nor any
mortgagee, of the PROPERTY, shall be liable or responsible for, and Tenant
hereby releases Landlord, its servants, agents or employees and each mortgagee
of the PROPERTY from all liability and responsibility to Tenant and any person
claiming by, through or under Tenant, for any injury, loss or damage to any
person or property in or around the PROPERTY or PREMISES to Tenant's business
irrespective of the cause of such injury, loss or damage, except for the grossly
negligent or intentionally wrongful acts of the Landlord. Notwithstanding the
foregoing, Tenant retains the right to claim that Landlord has breached its
obligations under this lease but has
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hereby released Landlord from liability for the type of injuries specified
herein resulting therefrom.
Section 4. Tenant shall procure and maintain, at Tenant's cost and
expense, throughout the term of this Lease the following insurance with respect
to the PREMISES:
(a) comprehensive single limit general public liability insurance against
claims for personal injury, death, or property damage occurring upon, in or
about the PREMISES, such insurance to afford protection to the limit of not
less than One Million ($1,000,000.00) Dollars;
(b) casualty and fire insurance policies with full extended coverage provisions
with respect to Tenant's property located with the PREMISES in an amount
not less than 100% of the replacement cost thereof, but in no event less
than the amount sufficient to avoid the effect of the co-insurance
provisions of the applicable policy or policies, which policies may include
provisions for retained risk or deductible damages not to exceed $50,000.
All policies required under the provisions of Section 4 of this Article 5 shall
name Landlord and Tenant as an insured, and Tenant shall provide to Landlord
evidence of the maintenance of such insurance.
ARTICLE 6.
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REPAIRS
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Section 1. Landlord, throughout the original or extended term of this
lease, shall maintain the building, and the adjacent sidewalks and parking areas
in good order and tenantable condition, and shall have the exclusive right to
make repairs to the interior of the PREMISES. Tenant, however, shall be
responsible for the cost and expense of all necessary repairs to the PREMISES,
or replacements thereof, interior and exterior, structural and non-structural,
ordinary as well as extraordinary, foreseen as well as unforeseen, except
repairs and replacements necessitated by damage by fire or other insured
casualty or condemnation (which shall be governed by the provisions of Article
15 and 16 of this Lease). When used in this Article, the term "repairs" shall
include replacements or renewals when necessary. Notwithstanding the Landlord's
right and undertaking to maintain the building and its adjacent sidewalks and
parking areas, and to make necessary repairs to the interior of the PREMISES,
Tenant shall nonetheless itself keep the PREMISES in good tenantable order and
condition, and shall suffer no waste or injury thereto. Tenant shall maintain
all equipment which is part of the PREMISES in good and operable condition,
except for ordinary wear and tear, unavoidable casualties, and except for those
conditions and casualties caused by the negligent or intentionally wrongful acts
of the Landlord, (for which Landlord will reimburse Tenant). Tenant shall
notify Landlord promptly of the need for any repairs of the PREMISES.
Section 2. Landlord shall arrange for all work and materials
contemplated by Section 1 above which relate to the PREMISES and any other part
of the building as well, such as, for example, a new roof, and Tenant shall be
responsible on a pro-rata basis for the cost of necessary
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repairs to the building. Landlord shall then apportion the costs of such work
and materials attributable to the PREMISES on a pro-rata basis, namely 32.95%
thereof, and xxxx tenant for such amount. Tenant shall pay the xxxx submitted by
Landlord within fifteen (15) days after Landlord sends the xxxx to the Tenant.
It is intended by this procedure that all repair costs will be paid by Tenant in
advance of the performance of any repair work. After the end of each lease year,
Landlord shall verify to Tenant the actual repair costs for such year and any
deficiency or overage shall be paid by Tenant, or credited to Tenant, in the
manner of the year-end reconciliation of taxes provided in Article 4 above.
Section 3. Landlord shall not be responsible to Tenant or to any other
party whatsoever for any loss of or damage to property, or injury to persons
occurring in or about the PREMISES by reason of any existing or future
condition, defect, matter of thing in the PREMISES, except to the extent
occasioned by the intentional misconduct or negligence of Landlord, its
servants, agents or employees, or any mortgagee, and not covered by applicable
policies of insurance required to be maintained by Tenant pursuant to this
Lease. In the event that Tenant shall fail or neglect to make any necessary
repairs as and to the extent required of Tenant pursuant to this Lease, then
Landlord or its agents may, without any obligation so to do, after thirty (30)
days notice to Tenant and upon Tenant's failure to cure the same within said
thirty (30) days, enter the PREMISES and make said repairs at the cost and
expense of Tenant, and in case of Tenant's failure to pay therefor, the said
cost and expense shall be added to the next month's rent together with interest
at fifteen percent (15%) per annum (or the maximum amount permitted by law,
whichever shall be less), as Additional Rent and shall be due and payable as
such.
ARTICLE 7.
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COMPLIANCE WTTH LAW AND REGULATIONS
-----------------------------------
Tenant throughout the term of this Lease, at Tenant's sole cost and
expense, shall promptly comply with all laws and ordinances and the orders,
rules, regulations and requirements of all federal, state and municipal
governments or authorities and appropriate departments, commissions, boards and
officers thereof and the orders, rules and regulations of any Board of Fire
Underwriters or similar body or agency where the PREMISES are situated, or any
body, now or hereafter constituted, exercising similar functions, foreseen or
unforeseen, ordinary or extraordinary, relating to the specific nature of
Tenant's use and occupancy of the PREMISES.
Tenant hereby acknowledges that the building containing the PREMISES has
been financed by tax exempt bonds issued by the Massachusetts Industrial Finance
Agency (hereafter "MIFA") which require that the building, including the
PREMISES, be used for manufacturing purposes and which impose restrictions on
the amount of non-manufacturing space permitted. Tenant represents, warrants
and covenants that for the entire duration of its Tenancy, it shall use the
PREMISES for manufacturing purposes and that the amount of non-manufacturing
space contained therein shall not be permitted to exceed twentyfive hundred
(2,500) square feet. The failure of Tenant to comply with the requirements and
restrictions set forth herein shall constitute a non-waivable breach of this
lease.
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Tenant will observe and comply with the requirements of the carriers of any
policy of insurance respecting the building, PROPERTY or PREMISES and the
requirements of all policies of public liability, fire, casualty and all other
policies of insurance at any time in force with respect to same, provided that
Landlord notifies Tenant of the requirements of said policies.
In the event that Tenant shall fail or neglect to comply with any of the
aforesaid obligations, then Landlord without any obligation so to do, after
thirty (30) days notice to Tenant and upon Tenant's failure to cure the same
within said thirty (30) days, may enter the PREMISES and effect compliance at
the cost and expense of Tenant, and in case of Tenant's failure to pay therefor,
the said cost and expense shall be added to the next month's rent, together with
interest at fifteen (15%) percent per annum, (or the maximum amount permitted by
law, whichever shall be less) as Additional Rent and shall be due and payable as
such.
ARTICLE 8.
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ALTERATIONS AND IMPROVEMENTS
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Tenant shall have the right during the term of this Lease to make such
alterations or additions to the PREMISES as Tenant shall deem necessary or
desirable in connection with the requirements of its business, which alterations
and additions shall be made in all cases subject to the following conditions
which Tenant shall observe and perform:
(a) No signage shall be fixed to any building or located in or about the
PREMISES Landlord's prior written consent, which shall be expressed in a
letter delivered at the time of the execution of this lease.
(b) No alteration or addition deemed structural or capital in nature shall be
undertaken until Tenant has obtained Landlord's prior written approval
which the Landlord shall not unreasonably withhold.
(c) No alteration or addition shall be undertaken until Tenant shall have
procured and paid for, so far as the same may be required from time to
time, all permits and authorizations of the various governmental agencies
having jurisdiction thereover. Landlord agrees to join in the application
for such permits or authorizations whenever such action is necessary.
(d) All alterations and additions when completed shall be of such as character
as not to reduce, or otherwise adversely affect, the value of the PREMISES,
nor to reduce the size of the building, the cubic content thereof, nor
change the character of the PREMISES. Tenant shall make all repairs to and
replacements of such alterations and additions made by it in and to the
PREMISES.
(e) All work done by Tenant shall be done promptly, in a good and workmanlike
manner, and in compliance with the building and zoning laws of the
municipality in which the PREMISES are located and in compliance with all
laws, ordinances, orders, rules, regulations and requirements of all
federal, state and municipal governments and authorities and the
appropriate departments, commissions, boards and officers thereof, and in
accordance with the orders, rules and regulations of the Board of Fire
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Underwriters where the PREMISES are situated or any other body exercising
similar functions and having jurisdiction thereof; said alterations or
additions shall be constructed and completed free of liens for labor and
material supplied or claimed to have been supplied to the PREMISES.
(f) Tenant shall, at Tenant's sole cost and expense, at all times when any work
is in process in connection with any alterations or additions, maintain
Builders Risk casualty insurance policy coverage in the amount of the full
replacement cost thereof, and statutory Workmen's Compensation Insurance
covering all persons employed in connection with the work and with respect
to whom death or injury claims could be asserted against Landlord, Tenant
or the PREMISES, general liability insurance for the mutual benefit of
Tenant and Landlord by obtaining policies of insurance with the same
limitations of coverage as set forth in Article 5, during the period of
such construction. All such insurance will be issued by a company or
companies authorized to do business in the Commonwealth of Massachusetts
and reasonably satisfactory to Landlord, and all such policies (or
certificates therefor) shall be delivered to Landlord and shall provide for
at least twenty (20) days prior written notice to Landlord of cancellation.
(g) All alterations and additions made or installed by Tenant shall be and
become the property of Landlord without payment therefor by Landlord, and
shall be surrendered to Landlord upon the expiration or sooner termination
of the term of this Lease, unless Tenant elects to remove the same or
Landlord requires Tenant to remove the same at Tenant's expense prior to
the expiration or sooner termination of the Lease (and Landlord shall
notify Tenant at the time of Landlord's approval as to whether or not such
removal will be required) and in such event Tenant shall restore the
PREMISES to the condition it was in prior to the installation of the said
improvements or alterations and additions. Provided that Tenant shall not
be in default of any of its obligations under this Lease and all prior
defaults shall have been fully cured at the termination of the term hereof,
Tenant shall have the right to remove its trade fixtures and personal
property from the PREMISES provided, however, that Tenant shall, at its own
cost and expense, repair any damage caused by such removal and shall have
restored the PREMISES to the condition that it was in prior to the
installation of Tenant's said trade fixtures and personal property.
Except as above specifically contemplated, Tenant shall not in any manner
make or suffer to be made any additions or alterations to or of the PREMISES.
Notwithstanding anything in the foregoing to the contrary, Tenant shall be
free at all times to bring its own furniture, fixtures, equipment, machinery,
tools, tooling and other personal property on the PREMISES prior to the
termination or expiration of this Lease.
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ARTICLE 9.
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MECHANICS' LIENS
----------------
Tenant shall not suffer or permit any liens, mechanics' liens, mechanics'
notices of intention, or the like to be filed against the PREMISES or any part
thereof by reason of work, labor, services, equipment or materials supplied or
claimed to have been supplied to or on behalf of Tenant or anyone holding the
PREMISES or any part thereof through Tenant. Before any persons or entities
perform any work or supply any materials to the PREMISES which could form the
basis for a mechanic's lien, Tenant shall require such persons or entities to
waive their mechanic's lien rights, said waiver to be done in writing and
conspicuously. If any such lines, mechanics' liens, mechanics' notices of
intention, or the like shall at any time be filed against the PREMISES, Tenant
shall cause the same to be discharged of record within thirty (30) days after
the date of filing the same, or if Landlord shall by written agreement with
Tenant, permit same to remain undischarged, Tenant shall post an insurance
company surety bond providing for and securing due payment thereof and holding
Landlord harmless and indemnifying it with respect thereto. Tenant shall not
have any right whatsoever to subject the interests of Landlord in the PREMISES
or in the fee simple title thereto to any mechanics' liens or other liens
whatsoever and nothing contained in this Lease shall be deemed to operate as an
express or implied consent to Tenant to subject the interests of Landlord to any
such lien or liens.
ARTICLE 10.
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WASTE
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Tenant covenants not to permit the PREMISES to fall into disrepair or to do
or suffer any waste or damage, disfigurement or injury to any building or
improvement now or hereafter on the PREMISES, or any material portion thereof,
or to permit or suffer any stationary overloading of the floors thereof. Tenant
covenants to keep that portion of the PREMISES outside of any building in a neat
and attractive condition, free of accumulations of trash and debris.
ARTICLE 11.
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INSPECTION BY LANDLORD
----------------------
Section 1. Tenant agrees to permit Landlord and the authorized
representative of Landlord to enter the PREMISES during usual business hours of
Tenant (a) for the purpose of inspecting the same and (b) if Landlord so elects,
but without any obligation so to do, and if Tenant has failed to do so within a
reasonable time*, for the purpose of making any necessary repairs to the
PREMISES and performing any work therein which may be reasonably necessary to
comply with any laws, ordinances, rules, regulations or requirements of any
public authority or of the Board of Fire Underwriters or any similar body, or
which may be reasonably necessary to prevent waste or deterioration in
connection with the PREMISES. Nothing herein shall imply
------------------
* After 30 day period as called for in Article 7 has expired.
-10-
any duty upon the part of Landlord to do any work which, under any provision of
this Lease, Tenant may be required to perform and the performance thereof by
Landlord shall not constitute a waiver by Landlord of Tenant's default in
failing to perform the same. Landlord may, during the progress of any such work
in the PREMISES, keep and store upon the PREMISES all necessary materials, tools
and equipment. Landlord shall not in any event be liable for inconvenience,
annoyance, disturbance, loss of business or other damage to Tenant by reason of
making such repairs or the performance of any such work in the PREMISES, or on
account of bringing materials, supplies and equipment into or through the
PREMISES during the course thereto and the obligations of Tenant under this
Lease shall not thereby be affected in any manner whatsoever; provided always,
however, that to the extent that Landlord elects to perform or is obligated to
perform any such repairs pursuant to the provisions of this Lease, Landlord
agrees that (to the extent reasonably practicable under the circumstances)
Landlord shall use its best efforts to cause such repairs to be performed in
such a way as to cause a minimum of inconvenience to Tenant in the operation of
Tenant's business in the PREMISES and to cause the said work to be accomplished
in as expeditious a manner as is reasonably practicable.
Section 2. During the final six (6) months of the term, Landlord is
hereby given the right at any time during usual business hours and upon prior
notice to Tenant to enter the PREMISES and to exhibit the same for the purposes
of sale and/or Lease. Landlord shall be entitled to show PREMISES to potential
buyers and/or prospective tenants and to display on the PREMISES in such manner
as not unreasonably to interfere with Tenant's business the usual "For Sale" or
"To Let" signs and Tenant agrees that such signs may remain, unmolested, upon
the PREMISES.
Section 3. During any such inspection, Landlord agrees to preserve the
confidentiality of Tenant's materials, and agrees to indemnify Tenant against
negligent or intentionally wrongful act while on the PREMISES.
ARTICLE 12.
-----------
ASSIGNMENT AND SUBLETTING
-------------------------
Section 1. Unless Landlord shall have given its prior written consent
thereto, Tenant may not assign this Lease or sublet the PREMISES. Under no
circumstances shall Tenant be permitted to assign or sublet to anyone failing to
meet the MIFA requirements for use and occupancy as set forth in Article 7. In
the event that this Lease shall be assigned or the PREMISES sublet, then and in
that event one-half of the net proceeds (after deducting Tenant's reasonable
costs incurred in connection with such assignment or subletting), avails and
profits of any such assignment or subletting shall be paid to and shall
constitute the sole and exclusive property of the Landlord herein.
Section 2. Should Tenant at any time during the term hereof desire to
assign this Lease or sublet the PREMISES, Tenant shall furnish Landlord with
thirty (30) days or more advance written notice (prior to the date of such
proposed assignment) specifying therein the date of such proposed assignment or
subletting, the name and address of the proposed assignee or subtenant, and if a
corporation or partnership, its principals and the nature of the business
proposed to be conducted in the PREMISES by said assignee or subtenant. If
Tenant assigns this
-11-
Lease or sublets the PREMISES without previously obtaining Landlord's consent as
foresaid, Landlord, by giving notice to the Tenant within thirty (30) days after
receipt of notice thereof, shall have the option to cancel and terminate this
Lease effective as of the date of such assignment or subletting or as of the
last day of the thirty (30) day notice period mentioned in this sentence,
whichever date shall be later. Landlord's failure to exercise its option as
contemplated by this Section 2 shall NOT be deemed to constitute Landlord's
consent to Tenant's proposed assignment of this Lease of the PREMISES or any
part thereof.
Section 3. Without limiting any of the provisions of Article 17, if
pursuant to the Federal Bankruptcy Code (or any similar law hereafter enacted
having the same general purpose) Tenant is permitted to assign this Lease or
sublet the PREMISES notwithstanding the restrictions contained in this Lease,
adequate assurance of future performance by an assignee or subtenant expressly
permitted under such Code shall be deemed to mean the deposit of cash security
in an amount equal to the sum of one year's Fixed Rent plus an amount equal to
the Additional Rent for the Lease year preceding the year in which such
assignment or subletting is intended to become effective, which deposit shall be
held by Landlord for the balance of the Term, without interest, as security for
the full performance of all Tenant's obligations under this Lease.
ARTICLE 13.
-----------
UTILITIES
---------
Section 1. Tenant agrees, at its own sole cost and expense, to pay, or
cause to be paid immediately when due, all charges for gas, electricity, light,
heat, power, sewer, water, sprinkler stand-by fees, telephone or other
communication service and all other utilities used, rendered to, or supplied
upon and/or in connection with the PREMISES throughout the term of this Lease,
or ordered or used by Tenant prior or subsequent thereto, and to indemnify the
Landlord and save it harmless against any liability therefor or damages on such
account. Landlord shall not in any event be liable to Tenant or responsible to
Tenant for any stoppage or interruption in any utility service furnished to the
PREMISES, or for the failure to obtain or inability to obtain any energy source
or fuel of any type or nature whatsoever, unless such condition(s) is caused by
the negligent or intentionally wrongful acts of the Landlord. No such stoppage
or inability of Tenant to obtain any such energy source or fuel shall operate to
constitute a constructive eviction of Tenant or relieve Tenant of its
obligations to pay rent under this Lease, unless such condition(s) is caused by
the negligent or intentionally wrongful acts of the Landlord.
Section 2. In the event that Tenant shall fail or neglect to pay for
any utilities, then Landlord, without any obligation so to do, after ten (10)
days notice to Tenant and upon Tenant's failure to pay the same within said ten
(10) days may pay the same and the said cost and expense shall be added to the
next month's rent as Additional Rent, together with interest at fifteen (15%)
percent per annum, (or the maximum amount permitted by law, whichever shall be
less) and shall be due and payable as such.
-12-
ARTICLE 14.
-----------
HOLD HARMLESS AND INDENEIMCATION
--------------------------------
Section 1. This Lease is made upon the express condition that Tenant
agrees to save Landlord harmless from and indemnify it against all liability,
penalties, losses, damages, costs, expenses, causes of action, claims and/or
judgments arising by reason of any injury in or about the PREMISES to any person
or persons, including without limitation, Tenant, its servants, agents and
employees, and damage in or about the PREMISES to any property of any kind
whatsoever, and to whomsoever belonging, including without limitation, damage to
property of Tenant, its servants, agents and employees, and other parties, which
such injury to persons or damage to property occurs as a result of or from any
cause or causes whatsoever, including, without limitation, damage from water
and/or steam leakage into or upon the PREMISES, or its appurtenances, or damage
or injury occurring on or about the sidewalks or parking areas adjacent thereto,
during the term of this Lease or any occupancy hereunder, except to the extent
occasioned solely by the intentional misconduct or gross negligence of Landlord,
its servants, agents or employees, or any mortgagee, and not covered by policies
of insurance required to be maintained by Tenant pursuant to this Lease.
Tenant, as a material part of the consideration to be rendered to Landlord,
hereby waives all claims against Landlord for damages to goods, equipment,
improvements, wares and merchandise in, upon or about the PREMISES and for
injuries to Tenant, its servants, agents, employees or third persons in or about
the PREMISES from any cause arising at any time, except to the extent occasioned
solely by the intentional misconduct or negligence of Landlord, its servants,
agents or employees, or any mortgagee, and not covered by applicable policies of
insurance required to be maintained pursuant to this Lease.
Section 2. If Landlord is made a party defendant to any litigation
concerning this Lease or the PREMISES and concerning a claim whereon Tenant has
some duty to hold Landlord free and harmless from and to indemnify Landlord as
set forth in paragraph 1, then Tenant shall hold Landlord harmless from all
costs including, but not limited to, reasonable attorneys' fees, and liability
by reason thereof incurred by Landlord in connection with such litigation and
all taxable court costs regardless of whether any such claim is meritorious or
lacking in merit.
Section 3. Tenant's obligations under this Article 14 are conditioned
on Landlord's giving written notice to Tenant of any claim or demand by a third
party which Landlord has determined has given rise to or could reasonably give
rise to a claim for indemnification pursuant to this Article 14. Tenant shall
then have a reasonable time (not to exceed thirty (30) days) after receipt of
such written notice from Landlord in which to retain counsel reasonably
satisfactory to Landlord to defend such third party claim or demand on behalf of
Landlord. In such case, Landlord shall make available to Tenant and its agents
and representatives all records and other materials which are reasonably
required in the defense of such third party claim or demand and shall otherwise
cooperate with and assist Tenant in the defense of such third party claim or
demand. So long as Tenant is defending such third party claim or demand in good
faith, Landlord shall not settle or compromise such third party claim or demand.
In the event of any third party claim or demand for which Landlord is entitled
to indemnification hereunder, Tenant
-13-
shall pay all reasonable legal fees and other costs and expenses incurred by
Tenant as the same become due, and Tenant shall pay on demand any nonappealable
judgment or other resulting obligation of such third party claim or demand.
Section 4. Landlord's right to indemnification pursuant to this Article
14 is subject to the limitation that Landlord shall not be entitled to assert
any right of indemnification hereunder after the seventh anniversary date of the
expiration of this Lease, except that if there shall then be pending any
dispute, claim, proceeding or action involving an indemnification claim under
this Lease, Landlord shall continue to have the right to be indemnified with
respect thereto.
ARTICLE 15.
-----------
CASUALTY
--------
Section 1. If the building containing the PREMISES shall be totally
destroyed by fire, explosion (except for such fire or explosion caused by the
negligent or wrongful acts of Tenant) or the elements, this Lease shall
immediately terminate. Total destruction for this purpose shall be such damage
or destruction to the building as would require the razing of entire sidewalls
of the building before reconstruction would be practicable. Any rent or other
payment unearned at the date of such total destruction which was therefor paid
in advance by the Tenant shall be refunded to it by the Landlord, subject to the
other provisions of this Lease.
Section 2. *If the part of the building containing the PREMISES, or any
part thereof shall be partially destroyed or damaged by fire, explosion, the
elements, or other insured cause, the Landlord shall repair the same as speedily
as possible, utilizing the proceeds of the insurance carrier on said building
and paid for by the Tenant. Until the portion of the building containing the
PREMISES so partially destroyed or damaged shall have been restored to its pre-
existing condition, there shall be a reasonable abatement of rent and other
charges due and payable during the term of restoration, the amount of such
abatement of rent depending upon the character and extent of damage and loss of
use to the Tenant.
Nothing in this Agreement and Lease contained shall obligate the Landlord
to use the proceeds of insurance payable to the Owner to replace or repair the
personal property of any type or description of the Tenant.
-----------
* Notwithstanding any other provisions contained in this Article 15,
Section 2., Tenant shall have the option to terminate this Lease if (a) the
damage to the PREMISES is such that, in Tenant's and Landlord's reasonable
estimation, restoration will not be completed within three (3) months after the
date of the casualty or (b) restoration has not, in fact been completed within
five (5) months after the date of such casualty. If this Lease shall not be
terminated as provided in this Article 15, Section 2., Landlord shall act
diligently to restore the PREMISES to its pre-existing condition.
-14-
ARTICLE 16.
-----------
CONDEMNATION/EMINENT DOMAIN
---------------------------
Section 1. This Lease shall terminate: (1) if the entire building
containing the PREMISES shall be taken by condemnation or eminent domain; or (2)
at the option of Tenant (exercisable by notice given to Landlord within thirty
(30) days after the date of any such taking) if a material part of the PREMISES
shall be taken in any condemnation or eminent domain proceeding(s). A taking of
a "material part" as such quoted words are used herein, shall mean the
condemnation or taking by eminent domain in excess of 10% of the ground floor
area of the building or in excess of 25% of the vacant land area of the parking
area.
Upon the termination of this Lease by reason of condemnation or eminent
domain, Tenant shall be liable only for the payment of Fixed Rent, additional
rent, impositions and other charges herein, pro-rated to the date of such
termination, and Landlord shall refund any payment in excess thereof to Tenant.
Section 2. Tenant may, if permitted by law, make any application for
any award which might be independently payable to it in connection with Tenant's
moving expenses, business dislocation damages of for the taking of Tenant's
leasehold improvements, provided that no such application or any award rendered
pursuant thereto shall operate to diminish any award which would otherwise be
payable to Landlord. Tenant waives its right to and agrees that it shall not
(i) make any other claim in or with respect to any condemnation or eminent
domain proceedings whatsoever or otherwise, or (ii) make any claim against
Landlord in any other action for the value of the unexpired portion of this
Lease or the term hereof. Except as above specifically provided, the total
amount of all condemnation awards shall be the sole and exclusive property of
the Landlord, and Tenant shall not participate therein or in the negotiation
thereof or have any rights whatsoever with respect to the awards or the proceeds
of any such proceedings.
Section 3. In the event that any part of the PREMISES is taken in any
condemnation or eminent domain proceedings and this Lease is not terminated
pursuant to Section 1 hereof, then this Lease shall remain in full force and
effect as to such remaining portion. Subject to the availability of the
proceeds of any award for reconstruction and restoration, Landlord shall
promptly reconstruct and restore the portion of the building upon the PREMISES
remaining after such taking to the same condition as initially demised
hereunder. In no event shall Landlord be obligated to expend any sums for such
rebuilding or restoration in excess of the amount of money actually paid to and
received by Landlord from any condemning authority, net of all expenses, which
expenses shall include any payments required to be made to any mortgagee of the
PREMISES to whom any such award may have been paid by such authority. The
payment of any award by any condemning authority to Landlord's mortgagee and the
application of such payment on account of Landlord's mortgage shall be deemed to
constitute receipt or constructive receipt of payment by Landlord. The balance
of any such proceeds shall, after completion of restoration and reconstruction,
be retained by Landlord.
-15-
ARTICLE 17.
-----------
BANKRUPTCY/INSOLVENCY AND DEFAULT OF TENANT
-------------------------------------------
Section 1. If, during the term of this Lease, Tenant shall default in
performance of any of the covenants of this Lease (other than the covenants for
the payment of Fixed Rent and/or Additional Rent), or if the PREMISES become
vacant or deserted, or if Tenant shall fail to move into or take possession of
the PREMISES within fifteen (15) days after the Commencement Date, or if any
executions or attachments shall be issued against Tenant or any of Tenant's
property whereupon the PREMISES shall be taken or occupied by someone other than
Tenant, then in any such event Landlord may give to Tenant notice of any default
or of the happening of any contingency in this Article referred to, and if at
the expiration of thirty (30)* days after receipt of such notice the default or
the contingency upon which said notice was based shall continue to exist,
Landlord, at his option, may terminate this Lease, and upon such termination
Tenant shall quit and surrender the PREMISES to Landlord, but Tenant shall
nonetheless remain liable under the terms and conditions hereof as herein
provided.
Section 2. If Tenant shall default in the payment of the Fixed Rent
and/or Additional Rent, or any part of the same, and if such default shall
continue for ten (10) days, and if Landlord gives to Tenant notice thereof, and
if at the end of five (5) business days after receipt of such notice the default
shall continue to exist, Landlord may immediately thereafter terminate this
Lease, but Tenant shall nonetheless remain liable under the terms and conditions
hereof as herein provided.
Section 3. Upon any termination of this Lease, Landlord or Landlord's
agents and/or servants may immediately or at any time thereafter re-enter the
PREMISES and remove all persons and all or any property therefrom either by
summary disposes proceedings or by any suitable action or proceedings at law and
may repossess said PREMISES together with all additions and alterations thereto,
without such re- entry and repossession working a forfeiture or waiver of the
rents to be paid and the covenants to be performed by Tenant during the full
term hereof. In the event of termination of this Lease by reason of the
occurrence of any of the events described in this Article, or in the event of
the termination of this Lease by summary disposes proceedings or under
provisions of law now or at any time hereafter in force by reason of or based
upon or arising out of a default under or breach of this Lease on the part of
Tenant or upon Landlord's recovering possession of the PREMISES in any
circumstances whatsoever, whether with or without legal proceedings, by reason
of or based upon or arising out of a default under or breach of this Lease on
the part of Tenant, Landlord may, at its option, at any time and from time to
time relet the PREMISES, or any part or parts thereof for the account of Tenant
or otherwise, and receive and collect the rents therefor, applying the same
first to the payment of such expenses as Landlord may have incurred in
recovering possession of the PREMISES, including the legal expenses and
reasonable attorneys' fees, and expenses of putting the same into good order or
condition or preparing or altering the same for re-rental and all other
expenses, commissions and charges paid, assumed or incurred by Landlord in
reletting the PREMISES or
-------------
* Unless such default is of a nature that it would take more than thirty
(30) days to cure and the Tenant has commenced to cure said default within the
thirty (30) day period.
-16-
in connection with a termination of this Lease by reason of Tenant's default and
then to the fulfillment of the covenants of Tenant hereunder. Any such reletting
herein provided for may be, at Landlord's option, for the remainder of the term
of this Lease or for a longer or shorter period and/or for a higher or lower
rent and/or with the granting of concessions. Landlord shall use reasonable
efforts to lease the PREMISES and obtain a reasonable rent and otherwise to
mitigate its damages. In any such case and whether or not the PREMISES, or any
part thereof be relet, Tenant shall pay to Landlord the Fixed Rent and all other
charges required to be paid by Tenant pursuant to this Lease up to the time of
such termination of this Lease, or of such recovery of possession of the
PREMISES by Landlord, as the case may be, together with such expenses as
Landlord may incur for attorneys' fees, brokerage fees and the cost of putting
the PREMISES in good order or for preparing same for re-rental, and thereafter
Tenant covenants and agrees if required by Landlord, to pay to Landlord until
the expiration date of the term of this Lease, as herein provided, as and for
liquidated damages the equivalent of the amount of all the Fixed Rent reserved
herein, Additional Rent and all other charges required to be paid by Tenant,
less the net avails of reletting, if any, and the same shall be due and payable
by Tenant to Landlord on each of the Rent days herein provided. In computing
such liquidated damages there shall be added to the deficiency such expenses as
Landlord may incur in connection with re-letting, such as legal expenses,
reasonable attorneys' fees, brokerage, advertising, and for keeping the PREMISES
in good order or for preparing the same for re-letting. Landlord shall be
entitled to retain any overage received as a result of its reletting of the
PREMISES.
Section 4. No expiration or termination of the Lease term pursuant to
the provisions of this Article or by operation of law, or otherwise, (except as
expressly provided herein), and no repossession of the PREMISES or any part
thereof pursuant to this Article, or otherwise shall relieve Tenant of its
liabilities and obligations hereunder, all of which shall survive such
expiration, termination or repossession.
Section 5. If Tenant fails to pay any sums due Landlord pursuant to the
provisions of this Lease, or to perform any other act on its part to be made or
performed, as in this Lease provided, except as specifically provided to the
contrary herein, then Tenant shall be deemed in default and Landlord may (but
shall not be obligated to do so) terminate this Lease if such default shall
continue for more than thirty (30)* days after written notice thereof from
Landlord, without waiving or releasing Tenant from any obligation of Tenant in
this Lease contained, and/or Landlord may make payment or perform any other act
on the part of Tenant to be made and performed, as in this Lease provided, in
such manner and to such extent as Landlord may deem desirable, and in exercising
any such rights Landlord may pay necessary and incidental and reasonable costs
and expenses, employ counsel and incur and pay reasonable attorneys' fees. All
sums so paid by Landlord and all necessary and incidental costs and expenses
incurred by Landlord in connection with the performance of any such act by
Landlord, together with interest computed thereon at the rate of fifteen (15%)
percent per annum (or the maximum legal rate of interest applicable to such
obligations, if any, then prevailing, whichever shall be less), from the date of
the making of such expenditure by Landlord shall be deemed Additional Rent
hereunder and, unless otherwise expressly provided, shall be payable to Landlord
upon demand or at the
-------------
* Unless such default is of a nature that it would take more than thirty
(30) days to cure and the Tenant has commenced to cure said default within the
thirty (30) day period.
-17-
option of Landlord, may be added to Fixed Rent or additional rent then due or
thereafter becoming due under this Lease, and Tenant covenants to pay any such
sum or sums, with interest as aforesaid, and Landlord shall have, in addition to
any other right or remedy, the same rights and remedies in the event of
nonpayment thereof by Tenant as in the case of default by Tenant in the payment
of Fixed Rent.
Section 6. If this Lease shall terminate by reason of the occurrence of
any default of Tenant or any contingency mentioned in this Article, Landlord
shall at its option and election be entitled, notwithstanding any other
provision of this Lease, or any present or future law, to recover from Tenant or
Tenant's estate (in lieu of all monetary claims against Tenant for damages,
additional rents, impositions and other charges) as damages for loss of the
bargain and not as a penalty, a lump sum which at the time of such termination
of this Lease equals the then present worth of the Fixed Rent and all other
charges payable by Tenant hereunder that were unpaid or would have accrued for
the balance of the term, less the fair and reasonable rental value of the
PREMISES for the balance of such term, such lump sum being discounted to the
date of termination at the rate of ten (10%) percent per annum, unless any
statue or rule of law governing the proceeding in which such damages are to be
proved shall limit the amount of such claim capable of being so proved, in which
case Landlord shall be entitled to prove as and for liquidated damages by reason
of such breach and termination of the Lease, the maximum amount which may be
allowed by or under any such statute or rule of law. Nothing herein contained
shall limit or prejudice Landlord's right to prove and obtain as liquidated
damages arising out of such breach or termination the maximum amount to be
allowed by or under any such statute or rule of law which may govern the
proceedings in which such damages are to be proved.
Section 7. No receipt of payment by Landlord from Tenant, after the
termination of this Lease, as herein provided, shall reinstate, continue or
extend the term or operate as a waiver of the right of Landlord to recover
possession of the PREMISES, it being agreed that, upon termination, any and all
payments collected shall be on account of Tenant's obligations hereunder.
ARTICLE 18.
-----------
NOTICES
-------
All notices, demands and requests which may or are required to be given by
either party to the other shall be in writing and shall be served by personal
service or by first class or certified mail, return receipt requested, or by
Federal Express or similar overnight delivery service. Service shall be deemed
made when sent or tendered for delivery to the party for whom delivery was
intended. All notices, demands and requests by Landlord to Tenant shall be sent
or delivered to Tenant at the PREMISES, with a copy to Peabody & Xxxxx, 000
Xxxxxxx Xxxxxx, Xxxxxx, XX 00000, Attention: Xxxxx X. Crush, P.C., or at such
other place as Tenant may from time to time designate in a written notice to
Landlord.
All notices, demands, and requests by Tenant to the Landlord shall be sent
to Landlord at XX Xxx 0000, Xxxxxxxxx, XX 00000, Attention: Xxxxxxxxxxx Xxxxx
or at such other place or to such other parties as Landlord may from time to
time designate in a written notice to Tenant.
-18-
ARTICLE 19.
-----------
LESSER AMOUNT OF RENT
---------------------
No payment by Tenant or receipt by Landlord of a lesser amount than the
monthly Fixed Rent and Additional Rent herein stipulated shall be deemed to be
other than on account of the earliest Fixed Rent or Additional Rent, nor shall
any endorsement or statement on any check or any lettering accompanying any
check or payment as rent be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to Landlord's right to recover
the balance of such rent or pursue any other remedy in this Lease or at law
provided.
ARTICLE 20.
-----------
QUIET ENJOYMENT
---------------
Section 1. Landlord covenants and agrees that it has and will have at
the commencement of the term of this Lease the full right and power to execute
and perform this Lease and to grant the estate demised herein.
Section 2. Landlord covenants and warrants that Tenant, upon paying the
Fixed Rent, additional rent and all charges herein provided for and observing
and keeping the covenants, agreements and conditions of this Lease on its part
to be kept, shall lawfully and quietly hold, occupy and enjoy the PREMISES
during the term of the Lease, without hindrance or molestation of Landlord or
any person or persons claiming under Landlord, and Landlord covenants and agrees
that it will defend Tenant in such peaceful and quiet use and possession of the
PREMISES against the claims of all such persons.
ARTICLE 21.
-----------
LIMITATION OF LANDLORD'S LIABILITY
----------------------------------
The term "Landlord" as used in this Lease, so far as covenants and/or
obligations on the part of Landlord are concerned, shall be limited to mean and
include only the owner or owners at the time in question of the fee of the
building and in the event of any transfer or transfers of the title to such fee
Landlord herein named (and in the case of any subsequent transfers or
conveyances the then grantor) shall be automatically freed and relieved from and
after the date of such conveyance or transfer or all liability for the
performance of any covenants or obligations on the part of Landlord contained in
this Lease thereafter to be performed, provided that any funds in the hands of
such Landlord or the then grantor at the time of such transfer, in which Tenant
has an interest, shall be turned over to the grantee and any amount then due and
payable to Tenant by Landlord or the then grantor under any provisions of this
Lease, shall be paid to Tenant. Further, in the event of any transfer or
transfers of title of such fee, whether by Liquidation or otherwise, then, as a
pre-condition to the validity of any such transfer, the transferee shall
expressly assume and accept all of the obligations of Landlord herein, and the
transferor shall, prior to the effective date of any such transfer, provide
Tenant with an original counterpart of such assumption and assignment signed by
the transferee.
-19-
ARTICLE 22.
-----------
ESTOPPEL NOTICES
----------------
Tenant agrees at any time and from time to time upon not less than twenty-
one (21) days prior written request by Landlord to execute, acknowledge and
deliver to Landlord a statement in writing certifying that this Lease is
unmodified and in full force and effect (or if there have been modifications
that the same is in full force and effect as modified and stating the
modifications), the Commencement Date of the term hereof and the dates to which
the Fixed Rent and other charges have been paid in advance, if any, it being
intended that any such statement delivered pursuant to this Article may be
relied upon by any prospective purchaser of Landlord's interests herein.
ARTICLE 23.
-----------
REMEDIES
--------
The specified remedies to which Landlord and Tenant may resort under the
terms of this Lease are cumulative and are not intended to be exclusive of any
other remedies or means of redress to which Landlord or Tenant my be lawfully
entitled in case of any breach or threatened breach of any provisions of this
Lease. This failure of Landlord or Tenant to insist in any one or more cases
upon the strict performance of any of the covenants of the Lease or to exercise
any option herein contained shall not be construed as a waiver or a
relinquishment for the future of such covenant or option. A receipt by Landlord
of rent .with knowledge of the breach of any covenant hereof shall not be deemed
a waiver of such breach, and no waiver by Landlord or Tenant of any provision of
this Lease shall be deemed to have been made unless expressed in writing and
signed by Landlord or Tenant (as the case may be). In addition to the other
remedies in this Lease provided, Landlord or Tenant shall be entitled to the
restraint by injunction of the violation or attempted or threatened violation,
of any of the covenants or other provisions of this Lease.
ARTICLE 24.
-----------
UNAVOIDABLE DELAYS
------------------
In the event that Landlord or Tenant shall be delayed or prevented from
performing any of its obligations pursuant to the provisions of this Lease
(other than Tenant's obligation to pay money) due to governmental action, or
lack thereof, or due to shortages of or unavailability of materials and/or
supplies, labor disputes, strikes, slow downs, job actions, picketing, secondary
boycotts, fire or other casualty, delays in transportation, acts of God, failure
to comply or inability to comply with any orders or request of any governmental
agencies or authorities, acts of declared or undeclared war, public disorder,
riot or civil commotion, or due to any other cause beyond the reasonable control
of such party, then such party shall in any or all such events be excused from
its obligation to perform and comply with such provisions of this Lease for a
period of time commensurate with any delay so caused, without any liability to
the other party therefor whatsoever, and all times periods provided for herein
for performance of any such obligations shall be extended for a period of time
commensurate with any such delay.
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ARTICLE 25.
-----------
SUBORDINATION
-------------
Tenant covenants that its rights under this Lease are now and will be
subordinate to the operation and effect of any existing Mortgage and/or any
subsequent mortgage hereafter existing (all of which may be referred to in this
Lease as "Mortgage") upon the PREMISES or any part or portion thereof without
any further written document from Tenant; however, Tenant agrees to execute any
instrument required by Landlord in furtherance of the provisions hereof.
1. In the event of any default by Landlord under any mortgage affecting
the PREMISES, Tenant shall have the right, but shall have no obligation, to pay
or cause to be paid any such indebtedness according to its terms and to deduct
and set off any such payment from any amounts payable hereunder to Landlord.
2. Upon the request of the Landlord or any holder of a mortgage on the
PREMISES, Tenant shall enter into an attornment agreement with such mortgagee.
ARTICLE 26.
-----------
NOTICES OF DEFAULT
------------------
Tenant agrees that any default notice served upon Landlord shall also be
served upon any mortgagee of the PREMISES, the name(s) of which Landlord shall
have furnished to Tenant theretofore. Tenant further agrees that Landlord's
mortgagee(s) shall have and be deemed to have the same opportunity to cure any
of Landlord's defaults pursuant to the provisions of this Lease as Landlord
shall be granted pursuant to the provisions of this Lease.
ARTICLE 27.
-----------
NOTICE OF LEASE
---------------
Upon request of either of the parties hereto, the parties agree to execute
a Notice of Lease of this Lease Agreement for purposes of recording in the
County in which the PREMISES are located. Said Notice of Lease shall not amend,
alter or modify any of the terms, covenants or conditions of this Lease. The
purpose of such Notice of Lease shall be to furnish notice of the existence of
this Lease to any prospective purchasers or mortgagees of the PREMISES or
assignees of the interests of either party hereto or to any other party having
an interest in the PREMISES.
ARTICLE 28.
-----------
USE
---
It is specifically understood and agreed that no part of the PREMISES
shall, at any time, be used for any purpose which shall emit or produce load
noises, vibrations, noxious fumes or odors or for any purpose which shall
constitute a nuisance or be unlawful.
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ARTICLE 29.
-----------
CONDITION OF PREMISES
---------------------
The PREMISES are being leased by Landlord to Tenant, and shall be delivered
to Tenant, in their present condition "as is" and Landlord shall not be
obligated to perform any additional work of any type or nature whatsoever in
connection with said PREMISES in order to prepare same for Tenant's use or
occupancy. Tenant shall, at its own sold cost and expense, obtain any and all
zoning and other governmental permits required in connection with the operation
of its business in the PREMISES for the use(s) herein specified or permitted.
ARTICLE 30.
-----------
LATE CHARGES
------------
In the event that any installment of Fixed Rent, or additional rent for
impositions or the like shall be delinquent and overdue for a period in excess
of ten (10) days, a "late charge" of five cents ($.05) for each dollar ($1.00)
so delinquent and overdue may be charged to Tenant by the Landlord for the
purpose of defraying and the Landlord's expenses incident to handling such
delinquent payment. This charge shall be in addition to, and not in lieu of, any
other remedy which the Landlord may have and is in addition to any reasonable
fees and charges of any attorney which the Landlord may employ to enforce the
Landlord's remedies in connection with any default hereunder, whether such
remedy(ies) shall be authorized herein, or by law.
Such "late charges", if not previously paid, shall, at the option of the
Landlord, be added to and become a part of the succeeding monthly installment of
Fixed Rent to be made under the Lease.
ARTICLE 31.
-----------
MISCELLANEOUS
-------------
(a) The covenants and agreements herein contained shall bind and inure to
the benefit of Landlord and Tenant, their heirs, executors, administrators,
successors and assigns.
(b) Whenever herein the singular number is used, the same shall include the
plural, and the masculine gender shall include the feminine and the neuter
genders.
(c) The enumeration anywhere in this Lease of any right or remedy of either
party shall not be construed as an exclusion or substitution of any other rights
or remedies conferred under this Lease or applicable by law.
(d) This Lease shall not be modified or canceled except by a writing
subscribed to by the parties.
(e) The submission of this Lease for examination does not constitute a
reservation of or option for the PREMISES and this Lease becomes effective as a
Lease only upon execution and delivery thereof by Landlord and Tenant.
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(f) This Lease shall be governed by and in accordance with the laws of the
Commonwealth of Massachusetts.
ARTICLE 32.
-----------
GUARANTY OF LEASE
-----------------
Tenant shall provide Landlord with a duly executed Guarantee by Qualtron
Teoranta, a foreign corporation, organized under the laws of Ireland
guaranteeing the prompt performance by Tenant of all of the conditions and
covenants set forth herein. A copy of said Guarantee is attached hereto as
Exhibit "C" and is made a part here.
ARTICLE 33.
-----------
GUARANTY OF SUBROGATION RIGHTS
------------------------------
The Tenant waives all rights of recovery against the Landlord or Landlord's
agents, employees or other representatives, for any loss, damages or injury of
any nature whatsoever to property or persons for which the Tenant is insured.
The Tenant shall obtain from the Tenant's insurance carriers, and will deliver
to the Landlord, waivers of the subrogation rights under the respective policies
to the extent such are available at commercially reasonable rates.
ARTICLE 34.
-----------
SURRENDER OF PREMISES
---------------------
At the expiration of the term, the Tenant shall quit and surrender possessions
of the said REMISES to the Landlord. The Landlord shall have the right during
the last ninety (90) days of the term hereof to make a comprehensive inspection
of the PREMISES. In the event any repairs must be made by Tenant the same shall
be made prior to the expiration of the lease term.
ARTICLE 35.
-----------
RESTRICTION ON USE
------------------
The PREMISES shall be used and occupied only and for no other purposes than
the manufacturing of communications equipment* and related products and office
uses incidental thereto as permitted by Article 7 above. In addition, Tenant
represents, warrants and covenants that prior to the expiration of the initial
three (3) year term of this lease it shall not make capital expenditures within
the PREMISES in excess of $1,000,000 and Tenant acknowledges that such
restriction and limitation is a requirement of the tax-exempt MIFA bonds used to
finance the construction of the building . For purposes hereof "Capital
Expenditures" means both new expenditures made within the PREMISES and
expenditures made within three (3) years prior to the, commencement date of the
term of this lease for equipment used within the PREMISES.
*and light electronics
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ARTICLE 36.
-----------
INVALIDITY OF PROVISIONS
------------------------
If any term or provision of this Lease or the application hereof to any
person or circumstance shall, to any extent, be invalid or unenforceable, or
subsequently become invalid or unenforceable, the remainder of this Lease, or
the application of such term or provision to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby, and each term and provision of this Lease shall be valid and be
enforced to the fullest extent permitted by law, except that in the event such
invalidity or unenforceability has the effect of increasing Landlord's
obligations or decreasing Landlord's benefits, including but not limited to
Fixed Rent or any additional rent, then Landlord shall have the option of
terminating this Lease.
ARTICLE 37.
-----------
HAZARDOUS SUBSTANCES
--------------------
Hazardous Substances: As used herein, "Hazardous Substance" means any
substance that is toxic, ignitable, reactive or corrosive and that is regulated
by any local government, the State of Massachusetts or the United States
government. "Hazardous substance" includes any and all material or substances
that are defined as "hazardous waste", "extremely hazardous waste", or a
"hazardous substance" pursuant to state, federal or local government law.
"Hazardous Substance" includes, but is not limited to, asbestos,
polychlorobiphenyls ("PCBs") and petroleum products.
Tenant represents, warrants and covenants that it shall not bring, use or
store any HAZARDOUS SUBSTANCES within or outside of the PREMISES.
The Tenant agrees to indemnify and hold harmless the Landlord from any and
all claims, damages, fines, judgments, penalties, cost liabilities or losses
(including without limitation, any and all sums paid for settlement of claims,
reasonable attorney fees, consultant and expert fees) arising during or after
the lease term from or in connection with the Tenant's use, storage or disposal
of hazardous substances in or on the PREMISES, and shall include any and all
costs incurred due to any investigation of the site or any cleanup, removal or
restoration mandated by a Federal, State or Local Agency or Political
Subdivision, in the event such HAZARDOUS SUBSTANCES are found to be present as a
result of the negligence, misconduct or other acts of the Tenant or Tenant's
Agents, Employees, Contractors or Invitees. This indemnification shall
specifically include any and all costs due to hazardous substances that flow,
diffuse, migrate or percolate into, onto or under the PREMISES after the lease
term commences that become present as a result of the negligence, misconduct or
other acts of the Tenant, Tenant's Agents, Employees, Contractors, or Invitees.
Tenant agrees to furnish Landlord with a current list of any such HAZARDOUS
SUBSTANCES used in its operation at any time said list is requested Landlord.
ENVIRONMENTAL NOTICES AND LIENS. Tenant further warrants and represents
that during the Lease Term, Tenant will promptly give Landlord notices of any
Environmental Claim or Lien threatened, asserted or about to be attached or
placed against the Tenant or the property.
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TENANT'S OBLIGATION TO REMEDY. If Tenant shall violate this Section or in
any way conduct Tenant's operations on the PREMISES or permit the PREMISES to be
used or maintained so as to subject the Landlord, the Tenant, or the PREMISES to
a claimed violation, Tenant shall immediately remedy and fully cure such
condition at its own cost and expense and shall indemnify and save the Landlord
harmless from any and all damages, remedial orders, judgments or decrees and all
costs and expenses related thereto or arising therefrom, including, but not
limited to, attorneys' and consultants' fees, cleanup, removal and restoration
costs and lost rentals. It is expressly understood and agreed that in the event
there are any obligations or Tenant with respect to payment or performance as
required under the terms and conditions of this Section that shall no have been
performed or paid prior to the expiration of termination of this Lease, such
obligations, any such condition at its sole cost and expense and to indemnify
Landlord as foresaid, shall survive the expiration of termination of this Lease
and surrender of the Leased Premises by the Tenant to the Landlord.
TENANT'S HAZARDOUS WASTE INDEMNITY COVENANT. If any lien shall be filed
against the Property or claim, demand, equitable proceeding or suit shall be
made, asserted or commenced against Landlord of the Property by any government
agency or any other person to pay for, or recover the cost or estimated cost of
removing hazardous waste from the Property arising from an intentional or
unintentional act or omission of Tenant resulting in the releasing, spilling,
pumping, pouring, emitting, emptying or dumping of "Hazardous Waste", then
Tenant shall, within thirty (30) days from the date that such environmental lien
or claim either:
(a) Pay the Environmental Claim and remove the Environmental Lien from the
Property; or
(b) Furnish a bond satisfactory to the Landlord in the amount of the claims out
of which the lien arises, or furnish a cash deposit in the amount of the
claims out of which the lien arises.
Tenant shall not be liable for the presence of any hazardous substance on
the PROPERTY unless caused by an act or omission of Tenant or persons engaged by
Tenant or under Tenant's control.
(SPACE INTENTIONALLY BLANK)
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IN WITNESS WHEREOF these presence have been signed, sealed and delivered the day
and year first above written.
THE HAVERDYNE COMPANY, LLC
/s/ Xxxxxxxxxxx Xxxxx 5-12-98 /s/ Xxxxx Xxxxxxx 5-12-98
----------------------------------------- ----------------------------------
By: Xxxxxxxxxxx Xxxxx, Member Date Witness Date
/s/ Xxxxxx X. XxXxxxxxxx 5-12-98 /s/ Xxxxx Xxxxxxx 5-12-98
----------------------------------------- ----------------------------------
By: Xxxxxx X. XxXxxxxxxx, Member Date Witness Date
QUALTRON, INC.
/s/ Xxxxxxx Xxxxx /s/ [signature appears here]
----------------------------------------- ----------------------------------
By: Xxxxxxx Xxxxx, (Title) CEO Date Witness Date
-26-
EXHIBIT A
[FLOOR PLAN APPEARS HERE]
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EXHIBIT "B" TO
HAVERDYNE/ QUALTRON LEASE
FIXED RENT PER MONTH: $7,223.30
(Beginning of Term)
ADDITIONAL RENT PER MONTH:
Real Estate Taxes (Est.)*: 1,141.
Common Area Maint./Exp. (Est.): 778.
Insurance (Est.): 148.
_________
TOTAL MONTHLY RENT: (1st year) $9,290.30
*Initial projection for first year of lease based upon assessed value of
property as of January 1, 1998 and projected assessed value as of January
1, 1999.
-28-
EXHIBIT C
GUARANTY
In consideration of The Haverdyne Company, LLC (the "Lessor") granting a
Lease dated ________, 1998 to PREMISES located at 000 Xxxx Xxxx Xxxxxx in
Haverhill, Massachusetts, and of making extensions of credit or extending other
financial or business accommodations to Qualtron, Inc., a newly formed
Massachusetts Corporation (the "Obligor") in connection with said Lease,
Qualtron Teoranta, a foreign corporation organized under the laws of Ireland,
having an address of Jefferson Office Park, 000 Xxxxxxxx, Xxxxx 000, Xxxxx
Xxxxxxx, XX 00000 (hereafter "the undersigned" and guarantor), hereby
unconditionally guarantees due payment, performance and fulfillment to the
Lessor of all liabilities, obligations and undertakings of Obligor to the Lessor
whether direct or indirect, absolute or contingent, due or to become due, now
existing or hereafter arising or acquired, sole, joint or several, and whether
consisting of obligations to pay money or to perform the Obligor's obligations
to the Lessor under the Lease (the "Obligations") .
The liability of the undersigned hereunder shall be limited to $500,000.
This agreement shall operate as a continuing and absolute guaranty and
shall remain in full force and effect until receipt by the Lessor of written
notice of the revocation of this guaranty or any notice of the possible
insolvency of, or transfer of substantial assets by, the undersigned. Such
notice shall not affect any obligations of the undersigned existing the time
such notice is received, and, if after any such revocation, notice of possible
insolvency or transfer, but prior to the Lessor's receipt of such notice
thereof, the Lessor grants any loan or extension to, or accepts any assignment
of indebtedness of, the Obligor or takes other action in reliance upon this
guaranty, the undersigned hereby agrees to indemnify the Lessor against, and
save it harmless from, all loss, cost, liability, and expense which it may incur
or suffer by reason of such action.
Notice of the acceptance of this guaranty and notices of transactions
entered into in reliance hereon are hereby waived. The undersigned consents to
any renewal, extension or postponement of the time of payment of any of the
Obligations or to any other forbearance of indulgence with respect thereto and
consents to any substitution, exchange, modification or release of any security
therefor or the release of any other person primarily or secondarily liable on
any of the Obligations, whether or not notice thereof shall be given to the
undersigned, and agrees to the provisions of any instrument, security or other
writing evidencing or securing any of the obligations, and the enforcement
hereof shall not be affected by the delay, neglect or failure of the Lessor to
take any action with respect to any security, right, obligation, endorsement,
guaranty or other means of collecting the Obligations which it may at any time
hold, including perfection or enforcement thereof, or by any change with respect
to the Obligor in the form or manner of doing business, whether by
incorporation, consolidation, merger, partnership formation or change in
membership, or otherwise, it being hereby agreed that the undersigned shall be
and remain bound upon this guaranty irrespective of any action, delay or
omission by the Lessor in dealing with the Obligor, any of the Obligations, any
collateral therefor, or any person at any time liable with respect thereto.
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On any default by the Obligor, the liability of the Undersigned hereunder
shall be effective immediately and the undersigned waives all requirements of
notice, demand, presentment or protest and any right which the undersigned might
otherwise have to require Lessor first to proceed against the Obligor or against
any other guarantor or any other person or first to realize on any security held
by it before proceeding against the undersigned for the enforcement of this
guaranty. The undersigned shall not assert any right arising from payment or
other performance hereunder, whether by set-off or counterclaim, or claim of
indemnity or reimbursement, or otherwise, until the undersigned's liability
hereunder shall have been discharged in full and all of Obligations shall have
been fulfilled.
The undersigned guarantees to the Lessor the payment of any and all
expenses paid or incurred by the Lessor (including reasonable attorneys' fees)
in connection with the collection of all sums and obligations guaranteed
hereunder, whether such collection be from the Obligor or from the undersigned.
If for any reason the Obligor has no legal existence or is under no legal
obligation to discharge any of the Obligations, or if any amounts included in
the Obligations shall have become not recoverable from the Obligor by operation
of law or for any other reason, or if any security or other guaranty shall be
found invalid, the undersigned shall nonetheless be and remain bound upon this
guaranty.
Any deposits or other sums at any time credited by or due from the Lessor
to the undersigned, and any securities or other property of the undersigned at
any time held by the Lessor may at all times be held and treated as security for
all obligations of the undersigned hereunder. Regardless of the adequacy of
security, the Lessor may apply or set off such deposits or other sums against
such obligations at any time.
This instrument, and all rights and remedies of the parties, shall be
determined as to their validity, construction, effect and enforcement, and in
all other respects of the same or different nature, by the laws of
Massachusetts; and the undersigned hereby submits itself and its property to the
exclusive jurisdiction of the Massachusetts courts in all matters relating to
this guaranty, or to its enforcement. No provision of this guaranty may be
amended or waived except in writing signed by the Lessor.
This guaranty is intended to take effect as a sealed instrument, shall
inure to the benefit of the Lessor and its successors and assigns, and shall be
binding upon the undersigned and the legal representatives, successors and
assigns of the undersigned.
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