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EXHIBIT 10.11
LEASE AGREEMENT
THIS LEASE AGREEMENT (the "Lease") is made and entered into
this 31st day of October, 1986, but shall become effective as of September 1,
1986, by and between ROCKFORD CORPORATION, an Arizona corporation, of 000 Xxxxx
Xxxxxxxx Xxxxx, Xxxxx, Xxxxxxx 00000 ("Lessee") and XXXXXXXXXX INDUSTRIES, INC.,
a Michigan corporation, of 000 Xxxxxx, X.X., Xxxxx Xxxxxx, Xxxxxxxx 00000
("Lessor").
W I T N E S S E T H :
WHEREAS, Lessor is the owner of certain premises located at
000 Xxxxxx Xxxxxx, X.X., Xxxxx Xxxxxx, Xxxxxxxx, improved with a three-story and
basement factory building and appurtenant parking facilities, as shown on the
diagram marked Exhibit A attached hereto and made a part hereof, subject to
easements, restrictions and encumbrances of record ("the Grand Rapids Plant");
and
WHEREAS, Lessor has leased approximately 20,000 square feet in
the Grand Rapids Plant to Lessee for a period of one year from November 7, 1985,
at a rental of $3,000 per month ("the Existing Lease"); and
WHEREAS, Lessor and Lessee desire to resettle and extend until
1991 the terms of the Existing Lease on the Grand Rapids Plant, by terminating
the Existing Lease and entering into a new Lease on the terms and conditions
hereinafter set forth.
NOW THEREFORE, in consideration of the mutual promises
hereinafter set forth, and intending to be legally bound hereby, Lessee and
Lessor hereby agree that Lessor shall lease to Lessee, and Lessee will rent from
Lessor, the Grand Rapids Plant for a period of five (5) years, commencing
September 1, 1986, and ending August 31, 1991, upon the following terms and
conditions:
1. Termination of Existing Lease. The Existing Lease is hereby
rescinded and terminated effective as of midnight, August 31, 1986.
2. Obligation to Pay Rent. Lessee shall pay rent to Lessor for the term
of this Lease in the sum of Four Hundred Fourteen Thousand Dollars ($414,000),
in monthly installments, in advance, without demand, setoff, deduction or
counterclaim, as follows:
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(a) From September 1, 1986, through December 31, 1986, at
the rate of $4,000 per month,
(b) From January 1, 1967, through April 30, 1987, at the
rate of $5,000 per month,
(c) From May 1, 1987, through August 31, 1987, at the rate
of $6,000 per month,
(d) From September 1, 1987, through August 31, 1989, at
the rate of $7,000 per month,
(e) From September 1, 1989, through August 31, 1990, at
the rate of $7,500 per month,
(f) From September 1, 1990, through August 31, 1991, at
the rate of $8,000 per month.
Rent shall be paid to Lessor at its address noted above, or at such other
address as Lessor shall designate by notice to LESSEE. The rental provided for
in this Lease shall be an absolutely net return to Landlord for the term, free
from any losses, expenses or charges with respect to the Grand Rapids Plant,
including, without limitation, maintenance, repairs, cost of replacement of
buildings or improvements, insurance, taxes, assessments or other charges
imposed upon or related to the Grand Rapids Plant, except to the extent
expressly provided by Sections 3 (a), 4 and 5 below. All additional charges
payable hereunder by Tenant shall be deemed "additional rent."
3. Insurance Obligation.
(a) Lessor shall carry and pay for fire, extended coverage and
casualty insurance on the Grand Rapids Plant, for its full replacement
cost in at least the present policy face amounts, under policies naming
as insureds both Lessor and Lessee as their interests may appear, with
the present or mutually acceptable carriers, for the period commencing
September 1, 1986, and ending November 30, 1986. Thereafter, and during
the term of this Lease and any extensions, Lessee shall carry and pay
for such insurance coverages.
(b) Lessee shall maintain workers' compensation insurance
covering all of its employees to at least the statutory limits set
forth under Michigan law, and a policy of general public liability
insurance in an amount at least equal to One Million Dollars
($1,000,000) single limit coverage for property damage, bodily injury
or death. Such policy of general public liability insurance shall name
Lessor as an additional insured and shall be underwritten by a carrier
and on such other terms and conditions as Lessor shall
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approve. It shall provide by endorsement or otherwise that such
insurance may not be cancelled, terminated, amended or modified for any
reason whatsoever, except upon thirty (30) days' prior written notice
to Lessor.
(c) Prior to the time the fire, extended coverage, casualty
and liability insurance required by this Section is first required to
be carried by a party hereto, and thereafter at least fifteen (15) days
prior to the expiration of any such policy, the party responsible for
maintaining- the same shall deliver to the other party either duplicate
originals of the aforesaid policies or a certificate evidencing such
insurance coverage together with evidence of payment for the policies.
In addition, any fire, extended coverage and casualty insurance policy
maintained by Lessor or Lessee with respect to the Grand Rapids Plant
or the content thereof, shall contain a clause or endorsement under
which the insurer waives, or permits the waiver by the insured
thereunder, of all rights of subrogation against the other party
hereto, and its agents, employees, customers, invitees, guests or
licensees, with respect to losses payable under such policy.
Notwithstanding the provisions of Section 8 below, the parties hereto
waive all right of recovery which they might otherwise have against one
another, and their respective agents, employees, customers, invitees,
guests or licensees, for any damage to their respective properties
which is covered by a policy of insurance, notwithstanding that such
damage may result from the negligence or fault of the other party, or
its agents, employees, customers, invitees, guests or licensees.
4. Obligation to Pay Taxes. Lessor shall pay all real estate taxes and
installments of special assessments last due and payable without penalty on the
Grand Rapids Plant during the period commencing September 1, 1986, and ending
December 31, 1987, before the same are delinquent, without proration.
Thereafter, during the term of this Lease and any extensions, Lessee shall pay
all real estate taxes and installments of special assessments with respect to
the Grand Rapids Plant before the same are delinquent, without proration, and
indemnify Lessor against any liability therefor. The party responsible for the
payment of such taxes and assessments shall, upon request, promptly provide
evidence of payment to the other party.
5. Maintenance and Repair Obligation. Lessee shall keep and maintain
the Grand Rapids Plant in good and clean order, condition and repair at all
times during the term of this Lease and any extensions, and will deliver the
same to Lessor at the expiration of the term in as good condition as when
received, except for reasonable use and wear thereof, and as provided in Section
12 below; provided, however, that Lessor shall reimburse Lessee for the
out-of-pocket cost in excess of $500 of any single item of repair or replacement
which was approved in advance by Lessor (which approval shall not be
unreasonably withheld). Lessee shall, at its sole expense, enter into and
maintain during the term of this Lease and any extensions, a contract for the
provision and maintenance of a security system for the Grand Rapids Plant, and
contracts for the regular repair and maintenance of the boiler and elevators
located in the Grand Rapids Plant, all of which shall be in form and substance
reasonably acceptable -to Lessor; provided, however, that Lessee may elect to
have an employee of Lessee maintain the boiler and/or elevators if Lessor first
consents to such arrangement. Lessor shall not unreasonably withhold or delay
such
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consent; provided that Lessee demonstrates to Lessor that the employee is
competent and qualified to perform such repairs and maintenance. Lessee's duties
with respect to the Grand Rapids Plant under this Paragraph shall include,
without limitation, responsibility for: (a) compliance with all applicable laws,
ordinances and regulations; (b) certification of boilers and elevators; (c)
cleaning, lawn maintenance, snowplowing and snow removal; and (d) replacement of
broken windows.
6. Obligation to Pay for Utilities. Lessee shall pay for all costs of
heat, light, power, telephone and other utilities it desires, used at the Grand
Rapids Plant during the term of this Lease and any extensions. Lessor shall not
be liable to Lessee in damages or otherwise for any failure or interruption of
any utility service furnished to the Grand Rapids Plant.
7. Peaceable Enjoyment, Right to Sublet and Office Facility for Lessor.
During the term of this Lease and any extensions, Lessee shall have the sole and
exclusive right to occupancy of the Grand Rapids Plant, and to the peaceable
enjoyment thereof, including the right to sublease all or any portion(s) of the
Grand Rapids Plant to any person(s) of its selection, so long as it is not then
in default of any of its obligations hereunder, and so long as it first obtains
the written consent of Lessor to such subletting, which consent shall not be
unreasonably withheld or delayed; provided, however, that Lessor shall have the
right to continue to occupy its current office facility in the Grand Rapids
Plant or such other space comprising at least 400 to 500 square feet upon which
the parties shall mutually agree, and to continue its exclusive use of the
fireproof room identified in Exhibit A for the storage of its records, as a
subtenant of Lessee, without any obligation for the payment of rent, for the
period ending August 31, 1987, with a right to extend upon terms mutually agreed
upon between Lessor and Lessee. Lessor's consent to any assignment or subletting
shall not be construed as a consent to any further assignment or subletting and
shall in no event release Lessee from any liability hereunder. Lessor shall have
24 hour security clearance with EPS or any other security firm employed by
Lessee for the office area of the Grand Rapids Plant until August 31, 1987.
Thereafter, Lessor shall have access to any portion of the Grand Rapids Plant
occupied or used by it pursuant to this Section during normal business hours
and, with Lessee's prior consent, during non-business hours.
8. Mutual Indemnification. Each party hereto shall indemnify the other
against and hold it harmless from any and all liabilities, obligations, damages,
penalties, claims, costs and expenses, including, without limitation, reasonable
attorneys' fees, paid or incurred as a result of or in connection with (i) such
party's ownership, use or occupancy of the Grand Rapids Plant, (ii) any breach
by such party, any subtenant or any of their agents, contractors, employees,
customers, invitees or licensees, of any covenant or condition of this Lease, or
(iii) the carelessness, negligence or improper conduct of such party, any
subtenant, or any of their contractors, employees, customers, invitees or
licensees. If any action or proceeding is brought against the other party by
reason of such claim, the indemnifying party, upon written notice from the other
party, will, at the indemnifying party's expense, resist or defend such action
or proceeding by counsel approved by the other party in writing.
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9. Use of Grand Rapids Plant. Lessee shall use and occupy the Grand
Rapids Plant for office, warehouse and manufacturing purposes, and for no other
purpose whatsoever. Lessee shall not use the Grand Rapids Plant, or permit the
Grand Rapids Plant to be used, in a manner that constitutes a violation of any
applicable law, ordinance, order or regulation, or that may be dangerous; nor
shall Lessee commit any waste in the Grand Rapids Plant, or permit any
objectionable noise or odor to be emitted, or permit anything to be done in the
Grand Rapids Plant tending to create a nuisance or disturb others.
10. Condition of Grand Rapids Plant. As Lessee has used and occupied
the Grand Rapids Plant for some time, Lessee is quite familiar with the current
condition of the Grand Rapids Plant. Lessee acknowledges that it has inspected
the Grand Rapids Plant, found it to be in satisfactory condition for its
intended use and accepts the Grand Rapids Plant in its current "AS IS"
condition, with no warranties whatsoever concerning its condition or permitted
use.
11. Alterations and Additions. Lessee may not alter or add to the Grand
Rapids Plant without Lessor's prior written consent, which consent shall not be
unreasonably withheld or delayed. Lessor shall have no obligation to make any
alteration or addition to the Grand Rapids Plant during the term. All right,
title and interest to any alterations and additions to the Grand Rapids Plant
during the term, except for trade fixtures and removable equipment, shall be the
property of Lessor and shall be deemed to be a part of the Grand Rapids Plant,
and shall remain on, and be surrendered with the Grand Rapids Plant upon the
termination of this Lease, without cost or expense to Lessor.
12. Restoration.
(a) If the Grand Rapids Plant is damaged or destroyed, in
whole or in part, Lessee shall repair, restore, replace or rebuild the
Grand Rapids Plant, or the part thereof so damaged, as nearly as
possible to the value, condition and character of the Grand Rapids
Plant immediately prior to the occurrence of such damage or
destruction. Lessee shall not be entitled to an abatement of rent
during the construction period.
(b) All insurance proceeds payable as a result of any damage
to or destruction of the Grand Rapids Plant shall be paid to Lessor and
shall be disbursed by Lessor to Lessee as reconstruction work
progresses. If the insurance proceeds are insufficient to pay for all
restoration work, then Lessee shall pay any additional amounts
necessary to restore the Grand Rapids Plant. Upon completion of the
restoration, and payment for all restoration work, all remaining
insurance proceeds shall be retained by Lessor.
(c) Notwithstanding the foregoing provisions of this Section,
if the damage to or destruction of the Grand Rapids Plant cannot be
repaired within one hundred twenty (120) days of the damage, either
Lessor or Lessee may terminate this Lease by giving ten (10) days'
prior written notice to the other party within thirty (30) days after
the damage
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or destruction occurs. If the Lease is terminated pursuant to this
subsection, all insurance proceeds payable as a result of the damage or
destruction shall be retained by Lessor.
(d) The provisions of this Section shall not apply to the
proceeds of any policy of business interruption insurance which Lessee
may place to cover its operations in the Grand Rapids Plant, all
proceeds of which policy shall be and remain the property of the
Lessee.
13. Condemnation. If all or any substantial part of the Grand Rapids
Plant is taken or condemned by a governmental authority, or shall be conveyed by
Lessor under a threat of such taking or condemnation, the rights and obligations
of Lessor and Lessee with respect to such taking or condemnation shall be as
provided in this Section. If twenty-five percent (25%) or more of the gross
floor area within the Grand Rapids Plant is so taken, condemned or conveyed,
this Lease shall terminate as of the date of such taking, condemnation or
conveyance, and rent shall be prorated as of such date. If less than twenty-five
percent (25%) of the gross floor area within the Grand Rapids Plant is taken,
condemned or conveyed, this Lease shall remain in effect; provided, however,
that the rent payable by Lessee shall be reduced for the remainder of the term
in the same proportion which the number of square feet of gross floor area
within the buildings comprising the Grand Rapids Plant following such taking,
condemnation or conveyance bears to the number of square feet of gross floor
area within the buildings comprising the Grand Rapids Plant prior to such
taking, condemnation or conveyance. To the extent that the award made for the
taking is available to Lessor, Lessor shall, at its own cost and expense, make
all necessary repairs or alterations to the Grand Rapids Plant so as to
constitute the portion of the Grand Rapids Plant not taken as a complete unit,
and Lessee shall have no obligation to make any such repairs or alterations.
Lessor shall be entitled to the entire award made for any taking, condemnation
or conveyance, except that Lessee shall not be precluded from pursuing any claim
directly against the condemning authority for its loss.
14. Lessor's Right to Perform. Lessor may perform any obligations of
Lessee hereunder which Lessee has failed to perform. Lessee shall reimburse
Lessor for all payments made and expenses incurred. Such payments and expenses
shall be additional rent which is immediately due and payable, together with
interest thereon at the lesser of the rate of twelve percent (12%) per annum or
the highest legal rate of interest.
15. Default. If default is made by Lessee in the payment of rent or
additional rent or in the performance of any of the conditions or covenants in
this Lease, and if such default shall continue for a period of ten (10) days
after written notice is given to Lessee by Lessor specifying the default, then
Lessor shall have the right to re-enter the Grand Rapids Plant and remove Lessee
and all persons therefrom and shall have the right to terminate this Lease. If
default is made by Lessee and Lessor exercises its option to terminate this
Lease, in addition to all other remedies now or hereafter provided to Lessor,
Lessor may proceed to re-rent the Grand Rapids Plant and collect from Lessee any
deficiency between the rent payable hereunder and the rent received from any
replacement tenant.
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16. Miscellaneous Provisions.
(a) Sale of the Grand Rapids Plant. If Lessor sells the Grand
Rapids Plant during the term of this Lease or any extensions, Lessor
shall require the purchaser to honor Lessee's rights under this Lease
Agreement, subject to Lessee making all required rental and other
payments falling due thereafter, and complying with all the terms and
conditions of this Lease.
(b) Extension of Lease. Lessor or Lessee shall give ninety
(90) days' notice to the other if either wishes to terminate this Lease
at the end of its term, or at any time thereafter; and until the
passage of ninety (90) days after such giving of notice, this Lease
shall continue on a month-to-month basis.
(c) Notices. All notices herein required shall be given in
writing upon the parties at the addresses indicated on page 1 hereof.
Any notice shall be deemed to have been given when personally delivered
or when sent by certified mail, return receipt requested and postage
prepaid. The addresses specified for notices herein may from time to
time be changed by the written notice of one party to the other.
(d) Remedies Cumulative; Waiver. All rights and remedies
hereunder are cumulative, and not exclusive, and shall be in addition
to all other rights and remedies provided by applicable law. Failure to
exercise or delay in exercising any right or remedy hereunder shall not
operate as a waiver thereof, nor excuse future performance. No waiver,
discharge or renunciation of any claim or right arising out of a breach
of these terms and conditions shall be effective unless in a writing
signed by the party so waiving. Any waiver of any breach shall be a
waiver of that breach only and not any other breach, whether prior or
subsequent thereto.
(e) Successors and Assigns. Subject to Section 7 hereof, this
Lease shall be binding upon and inure to the benefit of the parties
hereto and their respective personal representatives, heirs, successors
and assigns.
(f) Legal Expenses. The losing party shall pay all reasonable
attorney's fees and expenses incurred by the winning party in enforcing
any provision of this Lease.
(g) Entire, Agreement Lessor and Lessee agree that this Lease
shall constitute the entire agreement between them and that all prior
negotiations, discussions,- correspondence and documentation are hereby
merged into this Lease and shall exist as finally defined herein.
(h) Applicable Law. This Lease Agreement is entered into, and
shall be interpreted and enforced, under the laws of the State of
Michigan.
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(i) Other and Confirmatory Documents. Each party hereto
agrees, upon the reasonable request of the other, to execute and
acknowledge all such other and confirmatory documents as may be needed
to give formal evidence of the consummation of the transactions
provided for in this Lease.
IN WITNESS WHEREOF, Lessee and Lessor have caused this Lease
Agreement to be executed by their duly authorized officers on the day, month and
year first above appearing.
ROCKFORD CORPORATION
By /s/
-------------------------------
Xxxxxx X. Xxxxxxx
Its President
XXXXXXXXXX INDUSTRIES, INC.
By /s/
-------------------------------
Xxxxx Xxxxxxxxxx
Its President
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AMENDMENT TO LEASE
THIS AMENDMENT TO LEASE is made as of the lst day of October
1988, by and between XXXXXXXXXX INDUSTRIES, INC., a Michigan corporation, of 000
Xxxxxx, X.X., Xxxxx Xxxxxx, Xxxxxxxx 00000 (the "Lessor"), and ROCKFORD
CORPORATION, an Arizona corporation, of 000 Xxxxx Xxxxxxxx Xxxxx, Xxxxx, Xxxxxxx
00000 (the "Lessee").
R E C I T A L S :
A. On October 27, 1986, Lessor and Lessee entered into a
certain Lease Agreement (the "Lease"), effective as of September 1, 1986, for
the demise of certain premises commonly known as 000 Xxxxxx Xxxxxx, X.X., Xxxxx
Xxxxxx, Xxxxxxxx (the "Existing Plant").
B. Lessee desires to expand its operations by contracting with
Lessor for the construction by Lessor and lease to Lessee, on real estate
commonly known as 000 Xxxxxxx, X.X., Xxxxx Xxxxxx, Xxxxxxxx, and adjoining the
Existing Plant, additional space for Lessee's operations (the "New Plant"). The
Existing Plant and New Plant are collectively referred to in the Lease, as the
"Grand Rapids Plant".
C. To accomplish such purposes, Lessor and Lessee desire to
amend the Lease as provided herein.
NOW, THEREFORE, LESSOR AND LESSEE, IN CONSIDERATION OF THE
MUTUAL COVENANTS CONTAINED HEREIN, AMEND THE LEASE AS FOLLOWS:
1. Term. The fifth introductory paragraph of the Lease is
amended in part to provide that the Lease shall be "for a period commencing
September 1, 1986, and ending ten (10) years after the New Plant Completion Date
(as hereinafter defined)".
2. Rent.
(a) The initial sentence of Paragraph 2 is amended in
part to read:
"Lessee shall pay rent to Lessor for the Existing Plan for the
terms of this Lease, in monthly installments, in advance,
without demand, setoff, deduction or counterclaim, as follows:
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(b) Paragraph 2(f) is amended in its entirety to
substitute the following subparagraphs:
"(f) From September 1, 1990, through August 31, 1992, at the
rate of $8,000 per month,
(g) From September 1, 1992, through August 31, 1994, at the
rate of $8,500 per month,
(h) From September 1, 1994, through August 31, 1996, at the
rate of $9,000 per month,
(i) From September 1, 1996, through August 31, 1998, at the
rate of $9,500 per month, and
(j) From September 1, 1998, through the balance of the term,
at the rate of $10,000 per month. [4-1-99]
Lessee shall pay rent to Lessor for the New Plant for the term of this
Lease, in monthly installments, in advance, without demand, setoff,
deduction or counterclaim, as follows:
[2000/ft(2)](k) At the rate of $3.35 per square foot for the first two (2)
years following the New Plant Completion Date, [4/89 - 4/90 =
1st yr 4/90 - 4/91 = 2nd yr $6700]
(l) At the rate of $3.65 per square foot for the third and
fourth years following the new Plant Completion Date, [4/91 -
4/92 = 3rd 4/92 - 4/93 = 4th $7300]
(m) At the rate of $3.98 per square foot for the fifth and
sixth years following the New Plant Completion Date, and [4/93
- 4/94 = 5th 4/94 - 4/95 = 6th $7960]
(n) At the rate of $4.34 per square foot for the seventh an
eighth years following the New Plant Completion Date, and
[4/95 - 4/96 = 7th 4/96 - 4/97 = 8th $8680]
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(o) At the rate of $4.73 per square foot for the ninth and
tenth years following the New Plant Completion Date." [4/97 -
4/98 = 9th 4/98 - 4/99 = 10th $9460]
3. Maintenance. The proviso set forth in the initial sentence
of Paragraph 5 of the Lease shall be amended to read "provided, however, that
Lessor shall reimburse Lessee for the out-of-pocket cost in excess of $1,000 of
any single item of repair or replacement which was approved in advance by Lessor
(which approval shall not be unreasonably withheld) and was not the result of
the intentional act or negligence of Lessee, its employees, agents or invitees."
4. Construction of New Plant. A new Paragraph 17, with respect
to the construction of the New Plant, is added to the Lease, as follows:
"17. Construction and Occupation of the New Plant.
(a) Lessor shall diligently proceed to have the New Plant
constructed by contractors and suppliers selected by it, in
accordance with Exhibit B attached hereto, and place the
heating and ventilation equipment in good working order as of
the date of delivery of possession to Lessee (hereinafter
sometimes referred to as "Lessor's Work"). All Lessor's Work
shall be fully inspected by Lessee and shall not carry any
warranty from Lessor whatsoever, whether express or implied.
However, Lessee shall have the right to claim directly against
Lessor's contractors and suppliers for the breach of their
warranties.
(b) Other than Lessor's Work, any alterations, improvements,
additions, physical changes or other work necessary or
desirable to place the New Plant in a condition suitable for
Lessee's business purposes ("Lessee's Work") shall be
performed in a good and workmanlike manner by and for Lessee
at Lessee's sole cost and expense on or before thirty (30)
days following the completion of Lessor's Work. No
construction or installation by Lessee shall begin until
Lessor has approved the plans therefor, which approval shall
not be unreasonably withheld or delayed.
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All construction shall be performed in accordance with the
approved plans, at Lessee's sole cost and expense, by a
contractor or contractors first approved in writing by Lessor
(which approval shall not be unreasonably withheld or
delayed). Lessee's Work shall fully conform to all applicable
statutes, ordinances, regulations and codes. Prior to
commencing any work, Lessee shall require its contractors and
subcontractors to furnish Lessor with evidence of such
insurance coverage in such amounts as may be required by
Lessee.
(c) Upon the substantial completion of the Lessor's Work and
the Lessee's Work, the Lease term shall commence with respect
to the New Plant (the "New Plant Completion Date"). Once the
New Plant Completion Date has been determined, the parties
hereto agree to execute an addendum to this Lease setting
forth the actual New Plant Completion Date, the resultant
expiration date of this Lease, the square footage of the New
Plant, and the resultant rental rate payable with respect
thereto.
(d) The target New Plant Completion Date is April 1, 1989. If
possession of the New Plant shall for any reason not be
delivered to Lessee on such date, this Lease shall
nevertheless continue in full force and effect, and no
liability whatsoever shall arise against Lessor out of any
delay other than the abatement of rent, at the rate of
one-thirtieth (1/30th) of the monthly installment of rent for
the New Plant for each day of delay, until the Lessor's Work
and the Lessee's Work is completed.
(e) Lessor has entered into agreements, subject to customary
contingencies, for the construction of the New Plant and the
financing of such construction on terms satisfactory to
Lessor. Lessor shall comply with those agreements and exercise
every reasonable effort to obtain the construction and
financing of the New Plant in accordance with the terms of
those agreements. However, if Lessor is unable to do so for
any
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cause beyond its reasonable control, Lessor may terminate this
Amendment by notice to Lessee and neither party shall have any
further liability hereunder.
5. Ratification. Except as expressly amended hereby, the Lease
shall continue in full force and effect, as written.
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment to Lease as of the date first above written.
WITNESSES: XXXXXXXXXX INDUSTRIES
__________________________ By /s/ _________________________
Xxxxxx X. Xxxxxxxx
Owner
__________________________ Its ____________________________
Xxxxx X. Xxxxxx "Lessor"
ROCKFORD CORPORATION
/s/ ______________________
By /s/ Xxxxxx X. Xxxxxxx
_____________________________
Its
President
/s/ ______________________ ______________________________
"Lessee"
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EXHIBIT A
ROCKFORD/XXXXXXXXXX
Legal Description:
All of Lots 443, 445 & 447 & all that part of Lots 440, 442, 444, 446 & 448
lying E of E line P M RR Co S Rt of Way* Xxxxxxx & Co S Addition* also part of
SW 1/4 of Sec 13 T 7 N R 12 W Com at SE cor lot 440 Xxxxxxx & Co S addition th N
263 ft E 66 ft S 159 ft W 33 ft S 104 ft th W 33 ft to beg.
P.P. #41-13-13-330-004
000 Xxxxxx Xxxxxx, X.X.
[Map]
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AMENDMENT TO LEASE
THIS AMENDMENT TO LEASE ("Amendment") is made as of October 5, 1998, by
and between XXXXXXXXXX FAMILY LIMITED PARTNERSHIP, a Michigan limited
partnership, of 000 Xxxxxxxxx Xxxxx, X.X., Xxxxx Xxxxxx, Xxxxxxxx 00000
("Lessor"), and ROCKFORD CORPORATION, an Arizona corporation, of 000 Xxxxx
Xxxxxxxx Xxxxx, Xxxxx, Xxxxxxx 00000 ("Lessee") based on the following facts:
A. Lessor's predecessor in title, Xxxxxxxxxx Industries, Inc., and
Lessee, entered into a certain Lease Agreement dated October 27, 1986, effective
as of September 1, 1986 and amended as of October 1, 1988 (collectively,
"Lease") for the demise of certain premises commonly known as 000 Xxxxxx Xxxxxx,
X.X., and 000 Xxxxxxx, X.X., Xxxxx Xxxxxx, Xxxxxxxx (collectively, "Grand Rapids
Plant").
B. By its terms, the Lease is scheduled to terminate as of midnight,
March 31, 1999, which is ten years after the "New Plant Completion Date," as
defined in the Lease. However, Lessor and Lessee desire to extend the Lease
term, and provide Lessee with additional options to renew the Lease.
C. To accomplish such purposes, Lessor and Lessee desire to amend the
Lease as provided in this Agreement.
NOW, THEREFORE, Lessor and Lessee amend the Lease as follows:
1. TERM. The fifth introductory paragraph of the Lease is amended in
part to provide that the Lease shall be "for a period commencing September 1,
1986, and ending march 31, 2001."
2. RENT.
(a) Paragraph 2(j) of the Lease is amended in its entirety to
substitute the following paragraphs:
(j-1) From September 1, 1998, through March 31, 1999, at the
rate of $10,000 per month.
(j-2) From April 1, 1999, through March 31, 2001, at the rate
of $11,000 per month.
(b) Paragraph 2(o) is amended in its entirety to substitute
the following subparagraph:
(o) At the rate of $4.73 per square foot from April 1, 1997,
through March 31, 2001.
16
3. RENEWAL OPTIONS. The following additional subparagraph is added to
Paragraph 16 of the Lease.
(j) Options to Renew. So long as Lessee is not then in default
under this Lease, Lessee shall have three (3) options to renew this
Lease for additional terms of one (1) year each, upon giving Lessor at
least one hundred eighty (180) days written notice of the exercise of
such option prior to the then scheduled termination date of the Lease.
Each such renewal shall be on the same terms and conditions as set
forth in this Lease, with the exception that the Rent payable under
this Lease shall be increased at the commencement of each such renewal
term by three percent (3%) over the Rent payable for the period
immediately prior to such renewal.
4. RATIFICATION. Except as expressly amended by this Amendment, the
Lease shall continue in full force and effect, as written.
Lessor and Lessee have signed and delivered this Amendment to Lease as
of the date set forth above.
WITNESSES: XXXXXXXXXX FAMILY LIMITED PARTNERSHIP
[NOTARY SEAL]
/s/ By: /s/
------------------------ -----------------------------
Xxxxx X. Xxxxxxxxxx
Its General Partner
Lessor
/s/
------------------------
ROCKFORD CORPORATION
/s/
------------------------
By: /s/ Xxxxx Xxxxxxxx
------------------------------------------
/s/ Its Vice President Information Technology
------------------------
Lessee
[NOTARY SEAL]
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