EXHIBIT 10.1
LEASE AGREEMENT
THIS LEASE, made as of this 22 day of October, 2001, between the XXXXXXX
X. XXXXXX TRUST, Xxxxxxx X. Xxxxxx, Trustee, hereinafter referred to as
"LESSOR", and XXXXXX WELDING COMPANY, a Michigan corporation, hereinafter
referred to as "LESSEE".
W I T N E S S E T H:
PREMISES:
Lessor, in consideration of the rentals reserved and of promises herein
contained to be kept and performed by Lessee, does hereby demise unto Lessee,
and Lessee does hereby take from Lessor, a certain tract of land, and all
buildings, structures and improvements thereon, described as set forth on
Exhibit "A" attached hereto and made a part hereof (hereinafter called
"Premises").
1. TERM:
TO HAVE AND TO HOLD THE SAME, with all the privileges and appurtenances
pertaining thereto for the full term of five (5) years commencing the 14th day
of October, 2001.
2. RENT:
Lessee shall, monthly in advance, payable on the first day of each month
during the term hereof, pay to Lessor rental for the Premises at the following
rates:
October 14, 2001 to October 13, 2002 $20,440.33/month
October 14, 2002 to October 13, 2003 $21,273.67/month
October 14, 2003 to October 13, 2004 $22,107.00/month
October 14, 2004 to October 13, 2005 $22,940.33/month
October 14, 2005 to October 13, 2006 $25,000.00/month
3. TAXES, CHARGES AND ASSESSMENTS:
Lessee covenants to pay, or cause to be paid, all taxes and charges:
(a) on account of the use, occupancy or operation of the Premises;
(b) all real estate taxes, assessments and other charges applicable
to the Premises. At the commencement and termination of this Lease, all
real estate taxes payable by Lessee under the provisions of this Section
shall be
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apportioned between Lessor and Lessee as of the due date of such taxes.
4. LIABILITY AND CASUALTY INSURANCE:
(a) Lessee shall at all time during the term of this Lease, at its sole
cost and expense and for the mutual benefit of the Lessor and Lessee, maintain
general public liability insurance against claims for bodily injury, death or
property damage occurring in, upon or about the Premises or in, upon or about
adjoining streets, sidewalks or premises adjacent to the Premises, such
insurance to afford protection to the limit of not less than $1,000,000 in
respect of injury or death to any one person, to the limit of not less than
$1,000,000 in respect of any one accident and to the limit of not less than
$1,000,000 in respect of property damage.
(b) Lessee shall at all times during the term of this Lease and at its
sole cost and expense keep the building or buildings and improvements on the
Premises insured for replacement cost against loss or damage by fire, lightning,
windstorm, earthquake, hail, explosion, war loss if available, damage from
aircraft and vehicles and smoke damage. Lessee shall furnish Lessor with
certificates indicating that such insurance is in effect and that Lessor is
named as an additional insured. The loss, if any, under any policy provided for
in section (b) hereof shall be adjusted with the insurance companies by Lessee,
subject to the approval of Lessor except in case of a loss of less than
$100,000. All such policies or certificates therefor, issued by the respective
insurers, shall provide that the loss, if any, thereunder, shall be adjusted and
paid as provided in this Lease. The insurance required in this section 4(b) may
be provided under blanket policies issued to Lessee covering the Premises and
other properties owned or leased by Lessee.
(c) All insurance provided for in Sections 4 (a) and 4(b) shall be
effected with insurance companies approved by the parties, which approval shall
not be unreasonably withheld, under valid and enforceable policies, and such
policies shall name Lessor and Lessee as assureds, as their respective interests
may appear. All such policies of insurance shall provide that such policy shall
not be cancelled without at least ten (10) days prior written notice to each
assured named therein. All policies of insurance referred to in Section 4(b)
shall further provide that any loss shall be payable to Lessor or to the holder
of any mortgage, notwithstanding any act of negligence of Lessee which might
otherwise result in forfeiture of said insurance.
(d) Lessee shall be responsible to replace or repair any damages which are
covered by the insurance contracts hereinbefore provided using the proceeds of
such insurance to defray the cost of such replacement or repair in accordance
with Section 13 hereof.
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5. LESSOR'S RIGHT TO PERFORM LESSEE'S COVENANTS:
Lessee covenants and agrees that if it shall at any time fail to pay any
tax, charge or assessment in accordance with the provisions of Section 3, or
shall fail to make any other payment or perform any other act on the part of
Lessee to be made or performed, then Lessor may (but shall not be obligated so
to do), without further demand upon Lessee and without waiving or releasing
Lessee from any obligations of Lessee in this Lease contained: (i) pay any such
tax, charge or assessment, or (ii) make any other payment or perform any other
act on Lessee's part to be performed as in this Lease provided. All sums so paid
by Lessor, and all necessary incidental costs and expenses in connection with
the performance of any such act by Lessor, shall be deemed an additional rent
hereunder and shall be payable to Lessor on demand, and Lessee covenants to pay
any such sum or sums and Lessor shall have (in addition to any other right or
remedy of Lessor) the same rights and remedies in the event of the non-payment
thereof by Lessee as in the case of default by Lessee in the payment of the
fixed rental.
6. REPAIRS AND MAINTENANCE OF REPAIRS:
(a) Lessee covenants throughout the term of this Lease, at its sole cost
and expense, to maintain in good and tenantable repair, order and condition, the
buildings and improvements now, or at any time hereafter erected, on the said
land and promptly at Lessee's own cost and expense, to make all repairs,
structural and non-structural. When used in this section, the term "repairs"
shall include replacements or renewals when necessary.
(b) All property of any kind which may be on the Premises (whether
belonging to the Lessee or to third persons), shall be at the sole risk of
Lessee or those claiming by, through or under Lessee.
7. COMPLIANCE WITH ORDERS ORDINANCES, ETC.:
Lessee covenants throughout the term of this Lease, at Lessee's sole cost
and expense, promptly to comply with all statutes, ordinances, orders, rules,
regulations and requirements of all federal, state, county, municipal and other
governments.
8. MECHANIC'S LIENS:
If any mechanic's liens are filed against the fee of the Premises or
against the Lessee's leasehold interest in said Premises, they shall be promptly
satisfied by Lessee.
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9. NET LEASE:
Lessee and Lessor intend that this Lease be absolutely net. Lessee shall
bear all risk of damage to the Premises and shall pay all expenses related to
the Premises.
10. CONDITION OF PREMISES:
Lessee acknowledges that it has examined the Premises herein described and
any and all improvements or structures thereon prior to making of this lease and
knows the conditions thereof, and accepts the same in said condition, and
acknowledges that no representations as to the condition thereof have been made
by representatives of Lessor, and that Lessee in entering into this Lease, is
relying solely upon its own examination thereof.
11. EMINENT DOMAIN:
In the event that the Demised Premises are wholly taken or condemned for
public purposes by public authorities, then both Lessor and Lessee are released
of all of the obligations hereunder including the obligation to pay any rent
from and after the date when the condemning authority takes possession. The
entire proceeds payable as the result of any such condemnation, or taking in
lieu of condemnation, whether payable for the fee or the leasehold interest in
the fee shall be payable to Lessor; provided, however, that Lessee may make a
claim for its personal property.
In the event of a partial taking or condemnation for public purposes, the
proceeds thereof shall be payable to Lessor and Lessee shall have the option of
either terminating this Lease or continue occupancy of the remainder of the
Premises under the same terms and conditions. This option to terminate shall be
exercised by notice in writing within 30 days after the partial taking.
12. INDEMNIFICATION OF LESSOR:
Lessee agrees to indemnify and save harmless Lessor and the Premises
against any and all losses, injuries, claims, demands and expenses, including
legal expenses, of whatsoever kind and nature and by whomsoever made arising
from or in any manner directly or indirectly growing out of the use and
occupancy or non-use of the Premises or any equipment or facilities thereon or
used in connection therewith, except as provided in Article 9 hereof.
13. DAMAGE OR DESTRUCTION:
(a) Lessee covenants and agrees that in case of damage exceeding $25,000
in amount to, or destruction of, the Premises by fire or other casualty, Lessee
shall immediately notify Lessor thereof. Lessee, at its sole cost and expense,
whether or not such damage exceeds $25,000 in amount, shall proceed to restore,
repair
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or rebuild the same as nearly as possible to the condition they were in
immediately prior to such damage or destruction. Such restoration, repairs,
replacements, rebuilding or alterations shall be commenced promptly and
prosecuted with reasonable diligence.
(b) All insurance proceeds received on account of such damage or
destruction shall be applied as hereinafter set forth to the payment of the
costs of the aforesaid restoration, repairs, replacements, rebuilding or
alteration.
In the case of damage or destruction involving a loss of $100,000 or less,
all such insurance proceeds, if any, shall be paid to Lessee. In the case of
damage or destruction involving a loss of more than such amount, such insurance
proceeds shall be paid to Lessor and shall be disbursed to Lessee from time to
time upon receipt by Lessor of a certificate signed by an officer of the Lessee:
(i) Requesting payment of a specified amount of such insurance
proceeds;
(ii) Describing in reasonable detail work and materials applied by
Lessee to the restoration;
(iii) Stating that such specified amount does not exceed the cost of
such work and materials, including as part thereof the reasonable fees of
an architect or engineer, if any; and
(iv) Stating that no part of such cost has previously been made the
basis of any request for withdrawal of insurance proceeds under this
section.
Provided, however, that the balance of insurance proceeds shall not be reduced
below the amount specified in an architect's or engineer's certificate as the
amount required to complete the restoration.
If the insurance proceeds in the hands of Lessor shall be insufficient to
pay the entire cost of such restoration, Lessee shall provide the necessary
additional funds to accomplish the restoration.
14. DEFAULT:
(a) If one or more of the following events (herein sometimes called
"events of default") shall happen and be continuing:
(1) If Lessee defaults in the payment of any one of the rentals
provided to be paid hereunder and such default shall continue for ten (10)
days after written notice of such nonpayment by Lessor to Lessee;
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(2) If Lessee defaults in the observance or performance of any other
covenant, condition, agreement or provision hereof unless (i) such default
is remedied within thirty (30) days after written notice thereof from
Lessor to Lessee or (ii) all reasonable and necessary steps to remedy the
default are taken within such thirty (30) days period and the default in
fact remedied within six (6) months after such notice; or
(3) If Lessee admits insolvency or bankruptcy or its inability to
pay its debts as they may mature, or makes an assignment for the benefit
of creditors or applies for or consents to the appointment of a trustee or
receiver for Lessee, or for the major part of its property; or
(4) If a trustee or receiver is appointed for Lessee or for the
major part of its property and is not discharged within sixty (60) days
after such appointment; or,
(5) If bankruptcy, reorganization arrangements, insolvency or
liquidation proceedings, or other proceedings for relief under any
bankruptcy law or similar law for the relief of debtors, are instituted by
or against Lessee, and if instituted against Lessee are allowed against
Lessee or are consented to or are not dismissed, stayed or otherwise
nullified within sixty (60) days after such institution;
than, in any such case, Lessor may, at its option, exercise any one or more of
the following remedies:
(i) Lessor may terminate this Lease by giving to Lessee notice
of Lessor's intention to do so, in which event the term of this
Lease shall end, and all right, title and interest of Lessee
hereunder shall expire on the date stated in such notice, which
shall not be less than ten (10) days after the date of the notice by
Lessor of its intention so to terminate:
(ii) Lessor may terminate the right of Lessee to possession of
the Premises by giving notice to Lessee that Lessee's right of
possession shall end on the date stated in such notice, which shall
not be less than ten (10) days from date of such notice, whereupon
the right of Lessee to the possession of the Premises or any part
thereof shall cease on the date stated in such notice;
(iii) Lessee may enforce the provisions of this Lease and may
enforce and protect the right of Lessor hereunder by a suit or suits
in equity or at law for the specific performance of any covenant or
agreement contained herein or for the enforcement of any other
appropriate legal or equitable remedy.
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(b) If Lessor exercises either of the remedies provided for in
subparagraphs (i) or (ii) of Section 14(a), Lessor may then or at any time
thereafter re-enter and take complete and peaceful possession of the Premises,
with or without process of law, and may remove all persons therefrom, and Lessee
covenants in any such event peacefully and quietly to yield up and surrender the
Premises to Lessor.
(c) If Lessor terminates the right of possession as provided in
subparagraph (ii) of Section 14(a), Lessor may re-enter the Premises and take
possession of all thereof (including any and all equipment and apparatus
thereon), may remove any portion of the equipment, machinery or apparatus
thereon which Lessor elects so to do, and may sublet or relet the Premises or
any part thereof from time to time for all or any part of the unexpired part of
the then term hereof, or for a longer period, and Lessor may collect the rents
from such reletting or subletting, and apply the same, first to the payment of
the expense of re-entry and reletting, and secondly to the fixed rentals herein
provided to be paid by Lessee, and in the event that the proceeds of such
reletting or subletting are not sufficient to pay in full the foregoing, Lessee
shall remain and be liable therefor, and Lessee promises and agrees to pay the
amount of any such deficiency from time to time and Lessee may at any time and
from time to time xxx and recover judgment for any such deficiency or
deficiencies.
15. TERMINATION:
In the event of the termination of this Lease by Lessor as provided for by
subparagraph (i) of section 14(a), Lessor shall be entitled to recover from
Lessee all the fixed rentals accrued and unpaid for the period up to and
including such termination date, as well as all other additional rentals and
other sums payable by Lessee, or for which Lessee is liable or in respect of
which Lessee under any of the provisions hereof has agreed to indemnify Lessor,
which may be then owing and unpaid, and all costs and expenses, including court
costs and actual attorneys' fees incurred by Lessor in the enforcement of its
rights and remedies hereunder and in addition, Lessor shall be entitled to
recover as damages actual reasonable attorney's fees and court costs, which
Lessor shall have sustained by reason of the breach of any of the covenants of
this Lease other than for the payment of rent.
16. INSPECTION OF PREMISES BY LESSOR:
Lessee agrees to permit Lessor and the authorized representatives of
Lessor to enter the Premises at all reasonable times during the usual business
hours for the purpose of inspecting the same or making any necessary repairs to
the Premises and performing any work therein that may be necessary by reason of
Lessee's default under the terms of this Lease.
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17. NOTICES:
All notices provided for herein shall be in writing and shall be
determined to have been given (unless otherwise required by the specific
provisions hereof in respect of any matter) when delivered personally or when
deposited in the United States mail, register or certified, return receipt
requested, postage prepaid, addressed as follows:
If to Lessor: Xxxxxxx X. Xxxxxx, Trustee
Xxxxxxx X. Xxxxxx Trust
000 Xxxx Xxxxxx, Xxxxx X
Xxxx Xxxxx, XX 00000
With a copy to: Xxxxxxxxx X. (Xxxxxx) Xxxxx
0000 Xxxxx Xxxxx Xxxx
Xx. Xxxxx, XX 00000
If to Lessee: Xxxxxx Welding Company
0000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
or to Lessor and Lessee at such other addresses as such of them may designate by
notice duly given in accordance with this section to the other party.
18. CUMULATIVE REMEDIES - NO WAIVER:
The specific remedies to which Lessor or Lessee may resort under the terms
of this Lease are cumulative and are not intended to be exclusive of any other
remedies or means to which they may be lawfully entitled in case of any breach
or threatened breach by either of them or any provision of this Lease. The
failure of Lessor to insist in any one or more cases upon the strict performance
of any of the covenants of this Lease, or to exercise any option herein
contained, shall not be construed as a waiver or relinquishment for the future
of such covenant or option. One or more waivers of any covenant or agreement or
condition by the Lessor or Lessee shall not be construed as a waiver of a future
breach of the same covenant, agreement or condition. A receipt by Lessor of rent
with knowledge of the breach of any covenant hereof shall not be deemed a waiver
of any such future or continuing breach, and no waiver, change, modification or
discharge by either party hereto of any provision in this Lease shall be deemed
to have been made or shall be effective unless expressed in writing and signed
by both Lessor and Lessee.
19. ALTERATION: The Lessee, with Lessor's approval, which approval shall not be
unreasonably withheld, may remodel, alter and improve the Premises. Such work
shall be done without injury to any structural portion of the building.
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20. FIXTURES:
All improvements, alterations and additions which may be erected or made
at any time upon the Premises during the term hereof shall become a part of the
Premises and upon termination of this Lease shall remain the property of Lessor
except to the extent otherwise provided for in any consent or consents delivered
to Lessee by Lessor, which consent or consents shall not be unreasonably
withheld; provided, however, that upon termination of this Lease (except for
termination by reason of default of Lessee as hereinbefore provided), Lessee, at
its sole cost, may remove from the Premises all personal property, trade
fixtures, machinery, equipment, furniture, furnishings and consumable suppliers
not paid for by Lessor, which have been or may hereafter be placed upon the
Premises, whether or not affixed or annexed, unless the removal thereof would
result in damage to the Premises. Any damage caused to the Premises by the
removal of such property shall be restored in a good and workmanlike manner at
the sole expense of the Lessee.
21. ASSIGNMENT BY LESSEE:
Any assignment of this Lease or any subletting or underletting shall
require the approval of the Lessor in writing. Such approval shall not be
arbitrarily or unreasonably withheld by the Lessor and shall be given or refused
within ten (10) days following written request by the Lessee of its desire to
assign, sublet or underlet under this agreement.
22. ENVIRONMENTAL WARRANTIES:
Lessee shall not use, store, generate, treat or dispose on the Demised
Premises any hazardous substance without the prior written consent of Lessor,
which consent shall not be unreasonably withheld. For purposes of this section,
the term "hazardous substance" means any substance the manufacture, use,
treatment, storage, transportation, or disposal of which is regulated by any law
having as its object the protection of public health, natural resources, or the
environment, including, by way of illustration only and not as a limitation, the
Resource Conservation and Recovery Act; the Comprehensive Environmental
Response, Compensation, and Liability Act; the Toxic Substances Control Act; the
Federal Water Pollution Control Act; the Cleans Air Act; and the Michigan Water
Resources Commission Act.
Lessee shall promptly supply to Lessor a copy of the reports of any
environmental audit or investigation undertaken on the Demised Premises or
adjacent property, all notices, demands, inquiries, or claims received from any
person or entity as a result of contamination or pollution alleged to be on or
emanating from the Demised Premises or adjacent property, and any reports or
applications for licenses, permits, or approvals submitted by or on
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behalf of Lessee to any environmental regulatory agency affecting the Demised
Premises or adjacent property.
Lessor reserves the right to enter upon and inspect the Demised Premises
at any time, and from time to time, during Lessee's business hours and, on
reasonable notice, at other times.
23. MISCELLANEOUS:
(a) The captions of this Lease are for convenience only and are not to be
construed as part of this Lease and shall not be construed as defining or
limiting in any way the scope or intent of the provisions hereof.
(b) If any term or provision of this Lease shall to any extent be held
invalid or unenforceable, the remaining terms and provisions of this Lease shall
not be affected thereby, but each term and provision of this Lease shall be
valid and be enforced to the fullest extent permitted by law.
(c) All covenants, agreements and conditions herein contained shall be
binding upon and inure to the benefit of Lessor and Lessee and their respective
successors and assigns and the same shall be construed as covenants running with
the land.
IN WITNESS WHEREOF, Lessor and Lessee have caused this instrument to be
executed on the day and year first above written.
WITNESS AS TO LESSOR: XXXXXXX X. XXXXXX TRUST
/s/ BY: /s/ Xxxxxxx X. Xxxxxx
------------------------ ---------------------------------------
Xxxxxxx X. Xxxxxx, Trustee
/s/
------------------------
WITNESS AS TO LESSEE; XXXXXX WELDING COMPANY
/s/ BY: /s/ Xxxxxxx Xxxxxxx
------------------------ ---------------------------------------
Xxxxxxx Xxxxxxx
Its: President
/s/ Xxxxxx Xxxxx
------------------------
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