1
EXHIBIT 10.17(a)
LEASE
1. THIS LEASE is made on August 27, 1998, by Xxxxxx X. Xxxxxxx and
Xxxxxxxxx X. Xxxxxxx (hereinafter referred to as "Landlord") and Xxxxxxxx
Micro Science, Inc.(hereinafter referred to as "Tenant").
2. THE PREMISES. Landlord leases the following described
premises to Tenant, and Tenant leases the premises from Landlord, according
to this Lease. The Premises are the land and building commonly known as 000
Xxxxxx Xxxxx Xxxxxxxxxxx, XX. 00000. The land consists of approximately two
(2) acres. The building consists of approximately 45,000 square feet and
includes without limitation all heating, ventilating, air conditioning,
mechanical, electrical, plumbing systems, roof, walls and foundations and
fixtures within it. The Premises shall be delivered by Landlord and
accepted by Tenant, in their "as-is" condition; Landlord is not obligated
to make any improvements or repairs to the Premises, except for those
stated in paragraph 39, Landlord's Work. Tenant has had an opportunity to
inspect the Premises and to have its architects, engineers, or other
consultants inspect the Premises; Tenant has found the Premises fit for
Tenant's use; and Tenant accepts the Premises with all systems (roof,
walls, foundation, heating, air conditioning, sewer, electrical,
mechanical, utility and plumbing) in good working order and repair.
Landlord represents and warrants that the Premises are in compliance with
all federal, state and municipal statutes that are applicable to the
Premises. The Premises include all appurtenances, easements and rights of
way related to it. A legal description of the Premises is attached hereto
as Exhibit "A". Landlord represents and warrants that the Premises (as of
the Lease Commencement Date) are in full compliance with all laws including
without limitation, the Americans with Disabilities Act.
3. LEASE TERM. The term of this Lease will be ten (10) years and
four (4) months beginning on August 1, 1998 and expiring on November 30,
2008. However, if Tenant is not able to procure the permits required for
Tenant to operate it's business at the Premises (environmental, zoning and
construction) within the first six (6) months of this Lease, then Tenant
may terminate this Lease by written notice to Landlord within said six
month period, however Tenant shall pay Landlord for three months of free
rent given by Landlord to Tenant, which is $45,000.00, and Landlord shall
return Tenant's security deposit in full, and then this Lease will be null
and void.
3A. CATASTROPHE OUT CLAUSE. Tenant may terminate this Lease after
the end of the fifth (5th) year of the Lease by giving Landlord twelve (12)
months prior written notice of its intent to terminate and provided that
Tenant does the following: 1.) Tenant will continue to pay the then current
monthly rental to Landlord during the twelve month notification period, and
2.) at the end of the twelve month notification period Tenant will pay to
Landlord, in one lump sum, twelve months of net rent at the then current
monthly rental rate and real estate taxes for one year. Upon completion of
all of the above then this Lease will be terminated.
3B. OPTIONS. TENANT'S FIRST OPTION PERIOD. So long as Tenant
has not terminated this Lease under the Catastrophe Out Clause and is not
in default under this Lease, either at the time of exercise or at the time
the first option period commences, Tenant will have the option to extend
the initial ten year four month lease term for an additional five (5) years
(the "first option period") beginning December 1, 2008 and expiring on
November 30, 2013, on the same terms, covenants and conditions of this
Lease, except that the monthly rent during the First Option Period will be
determined according to a Consumer's Price Index (CPI) adjustment as
described below. Tenant will exercise its First Option Period by giving
Landlord written notice ("first option notice") at least six (6) months
prior to the expiration of the initial lease term of this Lease, which
would be by May 31, 2008.
TENANT'S SECOND OPTION PERIOD. So long as Tenant exercises its
First Option Period and is not in default under this Lease, either at the
time of exercise or at the time the second option period commences, Tenant
will have the option to extend the lease term for an additional period of
five (5) years (the "second option period") beginning December 1, 2013 and
expiring on November 30, 2018, on the same terms,
2
covenants and conditions of this Lease, except that the monthly rent during
the Second Option Period will be determined according to a CPI adjustment
as described below. Tenant will exercise its Second Option Period by giving
Landlord written notice ("second option notice") at lease six (6) months
prior to the expiration of the First Option Period, which would be by May
31, 2013.
4. RENT. Tenant will pay Landlord fifteen thousand dollars
($15,000.00) (the "monthly rent") in equal consecutive monthly installments
on or before the first day of each month beginning December 1, 1998 and
continuing thereafter until the rental adjustment date of December 1, 2003
at which time the monthly rent shall be adjusted as stated below. The
monthly rental shall also be adjusted on the beginning date of each option
period, as stated below.
The adjustment shall be made as follows: if the CPI for all urban
consumers (CPI-U) for Chicago-Gary-Lake County, IL-IN-WI issued by the
United States Bureau of Labor Statistics (based on all items for the period
1982 -84 =100) for the month preceding the adjustment date, (which is
November 2003) is higher than the index figure for the month in which this
Lease began, (which is August 1998) for the first adjustment date of
December 1, 2003, and is higher than the index figure for the months as
described below for the First and Second Option Periods, then the
adjustment shall be made and the annual rental for the next rental period,
until the next adjustment date or until the expiration or termination of
this Lease, whichever shall occur first, shall be arrived at as follows; to
determine the percentage increase between two months you take the CPI
figure for the most recent month less the CPI figure for the earlier month,
divide the resulting figure by the CPI figure for the earlier month,
multiply the resulting figure by 100, then multiply that figure by 90%,
since the increase is being calculated at 90% of the full CPI increase.
However, the rent for each new rental adjustment period shall under no
circumstances be less than the last preceding rental rate. To make the
adjustment for the First Option Period, the most recent CPI figure would be
the one for the month preceding the First Option Period, (which would be
November 2008) and the earlier CPI figure would be the month preceding the
first adjustment date of December 1, 2003 (which would be November 2003).
Likewise, to make the adjustment for the Second Option Period, the most
recent CPI figure would be the one for the month preceding the Second
Option Period (which would be November 2013) and the earlier CPI figure
would be the month preceding the First Option Period (which would be
November 2008). An example of how the CPI rental adjustment would be
calculated for the first adjustment date is as follows: assume that the CPI
for August 1998 is 164.8 and the CPI for November 2003 is 171.3, 171.3 -
164.8 = 6.50, 6.50/164.8 = .04 x .90 (90%) = .036 or 3.6%. The annual
rental rate would increase by 3.6%, which would be $6,480.00 per year, or
$540.00 per month.
The monthly rent and adjusted monthly rent will be paid in advance at
the address specified for Landlord in the basic lease information, or such
other place as Landlord designates in writing, without prior demand and
without any abatement, deduction or setoff. If Tenant fails to pay any
monthly rent or adjusted monthly rent or items of additional rent within
ten days of the date they are due and payable, such unpaid amounts will be
subject to a late payment charge equal to five percent (5%) of such unpaid
amounts. This late payment charge is intended to compensate Landlord for
its additional administrative costs resulting from Tenant's failure, and
has been agreed upon by Landlord and Tenant, after negotiation, as a
reasonable estimate of the additional administrative costs which will be
incurred by Landlord as a result of Tenant's failure. The actual cost in
each instance is extremely difficult to determine. This late payment charge
will be paid to Landlord together with such unpaid amounts.
If the lease commencement date occurs on a day other than the first
day of a calendar month, or if the expiration date occurs on a day other
than the last day of a calendar month, then the monthly rent or adjusted
monthly rent for the fractional month will be prorated on a daily basis.
5. TAXES. Tenant will pay as additional rental for the Premises
all taxes (collectively the "tax") including without limitation every tax,
assessment, excise, levy or other charge by any public authority on the
Premises, space, building or land whether general or special, ordinary or
extraordinary, foreseen or unforeseen or of any kind or nature whatsoever
that is assessed, levied, confirmed or imposed on the
2
3
Premises during the term of this Lease, whether or not now customary or
within the contemplation of Landlord and Tenant, including without
limitation the following taxes:
1.) taxes upon, measured by, or reasonably attributed to the cost
or value of Tenant's equipment, furniture, fixtures, and other personal
property located in the Premises, or by the cost or value of any leasehold
improvements made in or to the Premises by or for Tenant, regardless of
whether title to the improvements is in Tenant or Landlord;
2.) taxes upon or measured by the monthly rent, including without
limitation any gross receipts tax or excise tax levied by the federal
government or any other governmental body with respect to the receipt of
monthly rent;
3.) taxes upon or with respect to the possession, leasing,
operation, management, maintenance, alteration, repair, use, or occupancy
by Tenant of the Premises or any portion of the Premises;
4.) taxes upon this transaction or any document to which Tenant is
a party creating or transferring an interest or an estate in the Premises;
5.) taxes upon the Premises and all personal property, furniture,
fixtures and equipment, and all replacements, improvements, or additions to
them, whether owned by Landlord or Tenant;
6.) taxes based in whole or in part on a monthly rent, whether made
in addition to or in substitution for any other tax; and
7.) all general real estate taxes.
Taxes shall not include any inheritance, estate, succession,
transfer, gift or capital stock tax or franchise or net income tax
applicable to businesses generally.
All of which taxes, assessments, charges and other impositions shall
be paid by Tenant to Landlord in equal monthly installments, in amounts
reasonably estimated by Landlord. All the taxes listed above, if they
should become due during the term of this Lease, shall be handled in the
same manner as the general real estate taxes are handled, as described
below.
Any tax, including without limitation special assessments and taxes
that have been converted into installment payments, relating to a fiscal
period of a taxing authority, a part of which period is included in the
lease term and a part of which is included in a period of time prior to the
commencement or after the end of the lease term, whether or not such tax or
installments are assessed, levied, confirmed, imposed upon or in respect
of, or become a lien upon the Premises, or become payable, during the lease
term, will be adjusted between Landlord and Tenant so that Tenant will pay
that portion of the tax or installment that is applicable to Tenant's lease
term or which accrue during Tenant's lease term, and Landlord will pay that
portion which is not applicable to Tenant's lease term or which do not
accrue during Tenant's lease term.
General real estate taxes shall be paid in monthly installments by
Tenant to Landlord and payment shall be based upon the previous years's tax
xxxx. All tax escrow payments shall be deposited in an interest bearing
account at Bank One N.A. or such other institution as Landlord shall direct
and all interest accrued thereon shall be for Tenant's benefit, under
Tenant's tax identification number, and applied toward payment of the next
tax xxxx. The real estate tax xxxx for the Premises for 1997 was
$25,068.20. Tenant's monthly tax installment for 1998 shall be $2,100.00
per month beginning at the Lese Commencement Date. All real estate tax
installments shall be paid monthly, in advance and shall accompany the
monthly rental payment, but shall be issued under a separate check for
deposit in the tax escrow account. Upon receipt of the tax xxxx each year
Tenant shall pay any deficiency to Landlord prior to the tax xxxx due date
and if there is a surplus, the surplus will be applied to the next tax
xxxx, and the monthly tax installment shall be adjusted so that the sum of
the next twelve consecutive monthly tax installments will equal the
3
4
most recent tax xxxx. The general real estate taxes shall be prorated to
reflect the actual term of the lease during the first and last lease years.
Upon receipt of each tax xxxx Landlord will send a copy of the tax xxxx to
Tenant. General real estate taxes for the last year of this Lease, which
are levied and payable in the following year, shall be paid in the manner
stated above based upon the most recent tax xxxx.
RIGHT TO CONTEST TAXES. Tenant will have the right to contest the
amount or validity, in whole or in part, of any tax by appropriate
proceedings diligently conducted in good faith, only after paying such tax
or posting such security as Landlord may reasonably require in order to
protect the Premises from loss or forfeiture. Upon termination of any such
proceedings, Tenant will pay the amount of such tax or part of such tax as
finally determined, the payment of which may have been deferred during the
prosecution of such proceedings, together with any costs, fees, interest,
penalties, or other related liabilities. Landlord will not be required to
join in any such contest or proceedings unless the provisions of any law or
regulations then in effect will require that such proceedings be brought by
or in the name of the Landlord. In that event Landlord will join in such
proceedings or permit them to be brought in its name; however, Landlord
will not be subjected to any liability for the payment of any costs or
expenses in connection with any such contest or proceedings, and Tenant
will indemnify Landlord against and save Landlord harmless from any such
costs and expenses.
6. UTILITIES. Tenant will pay the appropriate suppliers for all
water, gas, electricity, light, heat, telephone, power and other utilities
and communications services used by Tenant on the Premises during the term
of this Lease, and Tenant shall cause such services to be billed directly
to Tenant. Tenant will also procure, or cause to be procured, without cost
to Landlord, any and all necessary permits, licenses, or other
authorizations required for the lawful and proper installation and
maintenance upon the Premises of wires, pipes, conduits, tubes and other
equipment and appliances for use in supplying any such service to and upon
the Premises. Landlord, upon request from Tenant, and at the sole expense
and liability of Tenant, will join with Tenant in any application required
for obtaining or continuing any such services.
7. INSURANCE. (A) "ALL-RISK" COVERAGE. Tenant will, at its
sole expense, obtain and maintain in force, during the term of this Lease,
"all-risk" insurance coverage including without limitation fire, wind,
earthquake, flood and extended coverage on the Premises in form and amounts
satisfactory to Landlord, which amount shall be reasonable, however the
insurance coverage shall at all times be in the amount of not less than
100% of the full replacement cost of the building, improvements, and
betterments located on the Premises, with all proceeds of insurance payable
to Landlord and any mortgagees of the fee as their respective interests may
appear. For the first year of this Lease the full replacement cost of the
building, improvements and betterments located on the Premises is
established as $2,200,000.00.
(B) GENERAL LIABILITY. Tenant will, at its sole expense, obtain and
maintain in force, during the term of this Lease comprehensive general
liability insurance for the benefit of Landlord against any and all
liability of Landlord and Tenant including, without limitation, claims for
personal injury, sickness or disease, death and property damage,
contractual liability, broad form property damage, host liquor liability,
non-owned automobile liability, in, on or about the Premises. Such
insurance shall afford protection in such amounts as Landlord may, from
time to time, reasonably require, however, at the commencement of this
Lease Tenant shall provide the above stated insurance with a combined
single limit of not less than three million dollars ($3,000,000.) in
respect to any one occurrence and not less than five million dollars
($5,000,000) in the aggregate and shall cover the entire Premises and all
claims arising out of the maintenance, use or occupancy of the Premises.
Said liability insurance shall be written on an "occurrence" basis and not
on a "claims made" basis. Tenant may satisfy the insurance requirements
stated herein through a combination of primary and umbrella liability
policies.
(C) TENANT'S CONTENTS. Tenant will, at its sole expense, obtain and
maintain in force, during the term of this Lease a policy of insurance
insuring Tenant's contents, trade fixtures, machinery, equipment, furniture
and furnishings in the Premises to the extent of at least ninety percent
(90%) of their replacement cost under standard fire and extended coverage
insurance, including without limitation, vandalism and malicious mischief
and sprinkler leakage endorsements.
4
5
(D) OTHER MATTERS. Tenant shall deposit with Landlord certificates
of insurance with respect to all insurance required to be maintained by
Tenant hereunder. All insurance policies will be subject to approval by
Landlord and any lender as to form and substance, and will expressly
provide that such policies will not be canceled or altered without thirty
(30) days' prior written notice to Landlord and any lender, and will, to
the extent obtainable, provide that no act or omission of Tenant which
would otherwise result in forfeiture or reduction of the insurance will
affect or limit the obligation of the insurance company to pay the amount
of any loss sustained. The policies of insurance to be maintained by Tenant
hereunder shall be written by a company or companies with a policy holder
rating ("Best Rating") of at least A and be assigned a financial size
category of at least Class XII as rated in the most recent edition of
"Best's Key Rating Guide" for insurance companies, authorized to do
business in Illinois, and shall name Tenant, Landlord and any mortgagees of
the fee as insureds thereunder, as their respective interest may appear.
Any insurance required of Tenant under this Lease may be furnished by
Tenant under a blanket policy carried by Tenant. Such blanket policy shall
contain an endorsement that names Landlord as an additional insured,
references the Premises and guarantees a minimum limit available for the
Premises equal to the insurance amounts required in this Lease.
(E) ADDITIONAL INSUREDS. All policies of liability insurance that
Tenant is obligated to maintain according to this Lease will name Landlord
as additional insureds. Certificates of insurance naming Landlord as an
additional insured will be delivered to Landlord prior to Tenant's
occupancy of the Premises and from time to time at least thirty (30) days
prior to the expiration of the term of each policy. All public liability,
property damage liability, and casualty policies maintained by Tenant will
be written as primary policies, not contributing with and not in excess of
coverage that Landlord may carry.
(F) WAIVER OF CLAIMS AND SUBROGATION. Landlord and Tenant hereby
waive all rights of action against the other for any loss, cost, damage or
expense resulting from fire, explosion or other casualty or occurrence
incurred by either, which loss, cost, damage or expense is then covered in
whole or in part by insurance maintained, or required to be maintained
pursuant to this Lease and each party waives any right of subrogation that
might otherwise exist in or accrue to any person on account thereof.
Landlord and Tenant will cause their respective insurers to issue
appropriate waiver of subrogation rights endorsements to all policies of
insurance carried in connection with the building or the Premises or the
contents of either of them. Tenant will cause all other occupants of the
Premises claiming by, under or through Tenant to execute and deliver to
Landlord a waiver of claims similar to the waiver in this paragraph and to
obtain such waiver of subrogation rights endorsements.
8. DAMAGE OR DESTRUCTION. PARTIAL DAMAGE. In the event the
Premises are partially damaged by fire, explosion or other casualty such
that Tenant can continue to operate its business at the Premises, Landlord
shall commence repair, restoration or rebuilding thereof within sixty (60)
days after such damage, or promptly after issuance of all necessary
building permits, if building permits are not received within said sixty
(60) day period, and shall complete such repair, restoration or rebuilding
with all due diligence, and rent shall be apportioned to the part of the
Premises which is usable by Tenant.
WHOLE DAMAGE. If the Premises are made untenantable by fire or other
casualty, Tenant may elect: (a) to terminate this Lease as of the date of
the fire or casualty by notice to Landlord within sixty (60) days after the
date, or (b) to direct Landlord to proceed with all due diligence to
repair, restore and rehabilitate the Premises at Landlord's expense in
which latter event this Lease shall not terminate. In the event the Lease
is not terminated pursuant to this provision, rent shall xxxxx on a per
diem basis during the period of untenantability. In the event of the
termination of this Lease pursuant to this Section, rent shall be
apportioned on a per diem basis and paid to the date of the fire or other
casualty.
9. USE. The Premises shall be used by Tenant in the same manner
and for the same purposes as Tenant is currently using the premises
commonly known as 0000 Xxxxxx Xxxxxx Xxxxxxxxxxx, Xxxxxxxx that Tenant
leases from Landlord and for general warehousing and distributing of
Tenant's and Tenant's customers products and general office usage
associated therewith and for no other purpose.
5
6
10. COMPLIANCE WITH LAWS. (A) TENANT'S OBLIGATIONS. Tenant will
not use or occupy, or permit any portion of the Premises to be used or
occupied:
(1) in violation of any law, ordinance, order, rule, regulation,
certificate of occupancy, or other governmental requirement; or
(2) for any disreputable business or purpose; or
(3) in any manner or for any business or purpose that would in any
way violate, suspend, void, or increase the rate of fire or liability or
any other insurance of any kind at any time carried by Landlord or Tenant
upon the Premises or its contents.
(B) Tenant will comply with all laws, ordinances, orders, rules,
regulations, restrictive covenants and any other governmental requirements
relating to the use, condition, or occupancy of the Premises, and all
rules, orders, regulations, and requirements of the board of fire
underwriters or insurance service office, or any other similar body, having
jurisdiction over the Premises.
11. ALTERATIONS AND IMPROVEMENTS. (A). Tenant will not make any
alterations, additions, or improvements to the Premises without the prior
written consent of Landlord. Landlord will not unreasonably withhold its
consent to minor, non-structural alterations and improvements, provided the
costs of such alterations or improvements shall not exceed $10,000.00 and
all such improvements and alterations shall be at the sole expense of
Tenant and at no expense to Landlord. Prior to the commencement of any
alteration, addition or improvement Tenant shall deposit with Landlord
certificates from an insurance company acceptable to Landlord, evidencing
workmen's compensation coverage, and insurance coverage in amounts
satisfactory to Landlord and protecting Landlord against public liability
and property damage to any person or property, on or off the Premises,
arising out of and during the making of any alterations, additions or
improvements. Any alteration or improvement by Tenant shall be done in a
good and workmanlike manner in compliance with any applicable governmental
law, statute, ordinance or regulation.
(B) Tenant shall promptly pay all costs and expenses of any
alteration, addition or improvement and shall promptly attain a waiver of
lien from all persons receiving any payment and their subcontractors,
employees and suppliers of materials and Tenant shall provide proof of such
waiver to Landlord. Tenant shall discharge all liens filed against the
Premises arising out of any alteration, addition or improvement or in the
alternative Tenant shall bond over or insure over any lien. In the event of
Tenant's failure to pay or bond or insure over a lien and Landlord
discharges the lien then Landlord is entitled to receive from Tenant all
reasonable costs and expenses incurred in discharging the lien including
reasonable attorney fees, all of which shall be additional rental due under
this Lease, or in the event of Tenant's failure to pay or bond or insure
over a lien Landlord may hold Tenant in default of this Lease and proceed
as per the terms of the default paragraph below. Tenant shall procure and
pay for all permits and licenses required in connection with any
alteration, addition or improvement.
(C) LANDLORD'S REVIEW AND INSPECTION COSTS. Tenant shall reimburse
Landlord for all reasonable costs and expenses incurred by Landlord in
connection with review and inspection of Tenant's work, including but not
limited to, architect's and engineer's fees and costs incurred by Landlord
in connection with 1) Landlord's review of the plans and specifications
for Tenant's work and all changes and amendments thereto, and 2)
Landlord's inspection of Tenant's work. Any such reasonable costs and
expenses incurred by Landlord pursuant to this paragraph shall be paid by
Tenant to Landlord, as additional rent, within ten (10) days of Tenant's
receipt of a xxxx therefor.
(D) Tenant may without Landlord's consent, at its expense, install,
assemble or place upon the Premises any items of machinery, equipment or
racking used or useful in Tenant's business. Such machinery, equipment and
racking shall be and remain the property of Tenant. Tenant may remove the
6
7
machinery, equipment and racking from the Premises at any time during this
Lease, provided that Tenant shall be required to repair any damage to the
Premises resulting from such removal.
12. CONDEMNATION. (A) WHOLE TAKING. If the whole of the
Premises shall be taken or condemned for a public or quasipublic use or
purpose by any competent authority or if such a portion of the Premises,
including any portion of the improvements, shall be so taken that as a
result thereof the balance is not suitable for Tenant's continued use or
occupancy, then in either of such events, the Lease term shall terminate
the day before Landlord makes delivery of possession to the condemning
authority and any award, compensation or damages (hereinafter sometimes
called "award") shall be paid to and be the sole property of Landlord
whether such award shall be made as compensation for diminution of the
value of the leasehold or the fee of the Premises or otherwise and Tenant
hereby assigns to Landlord all of Tenant's right, title and interest in and
to any and all such award. However, if Tenant receives compensation or
award for moving expenses, Tenant shall be entitled to the full amount of
such moving compensation award. Likewise, if Tenant receives compensation
for any leasehold improvements, alterations or enhancements, not of a
permanent nature and paid for by Tenant during the term of this Lease then
Tenant shall be entitled to the full amount of such compensation. Tenant
shall continue to perform all of the covenants and provisions of this
Lease, including the payment of rent, tax installments and all items of
additional rent which shall become due and payable until Tenant is required
to vacate the Premises as stated above, which is the day before Landlord
makes delivery of possession to the condemning authority.
(B) PARTIAL TAKING. If only a part of the Premises shall so be
taken or condemned, and as a result thereof the balance is suitable for
Tenant's continued use or occupancy, this Lease shall not terminate and
Landlord at its sole cost and expense, shall repair and restore the
Premises. Landlord shall promptly and diligently proceed to make a complete
architectural unit of the remainder of the improvements following such
taking or condemnation.
(C) Tenant may at its own expense take independent action against
the public authority exercising the power of eminent domain for any moving
expenses, for the taking of any of Tenant's trade fixtures and such other
elements of damage as may be awardable to Tenant in an independent action.
13. DEFAULT BY TENANT. (A) The following occurrences are "events
of default":
(1) Tenant defaults in the payment of rent, tax installment or any
item of additional rent, or part thereof and such default continues for
five (5) days after written notice from Landlord; however, Tenant will not
be entitled to more than one (1) notice for default in payment of rent, tax
installment or other item of additional rent during any twelve-month
period, and if, within twelve (12) months after any notice, any rent, tax
installment or item of additional rent is not paid when due, an event of
default will have occurred without further notice;
(2) Tenant vacates or abandons more than 80% of the Premises during
the term of this Lease;
(3) Default be made in the performance of any of the terms, covenants
and conditions in this Lease contained on the part of Tenant to be kept or
performed and if any default specified in this subparagraph (3) shall
continue for a period of thirty (30) days after written notice and demand,
unless Tenant in good faith commenced the curing of such default within
said thirty (30) days, in which event Tenant shall have reasonable time to
do so;
(4) If Tenant fails to take possession of the Premises within thirty
(30) days of the Lease Commencement Date;
(5) Tenant fails to pay or bond or insure over any lien on the
Premises which is caused by work performed for Tenant;
7
8
(6) Tenant suffers an "Event of Bankruptcy", which means the filing
of a voluntary petition by Tenant, or the entry of an order for relief
against Tenant, under Chapter 7, 11 or 13 of the Bankruptcy Code (or the
conversion of a Chapter 11 or 13 proceeding to a proceeding that is filed
by or against Tenant under any other chapter of the Bankruptcy Code).
(B) Upon the occurrence of any one or more of such events of
default, (with the exception of #6, "Event of Bankruptcy", which shall be
handled as stated below in paragraph D) Landlord may, if Landlord so
elects, at any time thereafter, terminate this Lease and the term hereof by
giving Tenant notice in writing of Landlord's intention to do so, and
Tenant's right to possession of the Premises will cease and the Lease will
be terminated; or Landlord may terminate Tenant's right to possession only,
without terminating this Lease. Upon termination of this Lease or upon
termination of Tenant's right to possession, Tenant shall immediately
vacate and surrender and deliver possession of the Premises to Landlord.
Landlord or Landlord's employees or agents may immediately or at any time
thereafter without notice to Tenant, re-enter the Premises and remove all
persons and property from the Premises, either by any action or proceeding
at law or in equity or by force or otherwise, without being liable in
indictment, prosecution or damages and repossess the Premises with the
alterations, additions and improvements thereon, together with the right to
receive all income from the Premises.
(C) If Landlord takes possession of the Premises without terminating
this Lease, Landlord may re-let the Premises or any part of the Premises,
on such terms and conditions (which may include concessions of free rent,
and the alteration and repair of the Premises) as Landlord, in its
uncontrolled discretion, may determine. Landlord may collect and receive
the rents for the Premises. Landlord will not be responsible or liable for
any failure to collect any rent due upon such re-letting. No such re-entry
or taking possession of the Premises by Landlord will be construed as an
election on Landlord's part to terminate this Lease unless written notice
of such intention is given to Tenant. No notice from Landlord under this
Lease or under a forcible entry and detainer statute or similar law will
constitute an election by Landlord to terminate this Lease unless such
notice specifically says so. If Landlord elects to take possession of the
Premises according to this paragraph without terminating this Lease, Tenant
will pay Landlord (I) the rent and all other sums which would be payable
under the terms of this Lease if such repossession had not occurred, less
(II) the net proceeds, if any, of any re-letting of the Premises after
deducting all of Landlord's reasonable expenses incurred in connection with
such re-letting, including without limitation, all repossession costs,
brokerage commissions, legal expenses, attorney's fees, alteration,
remodeling, repair costs, environmental clean up, and expenses of
preparation for such re-letting. Tenant will pay such amounts to Landlord
monthly on the days on which the rent and all other amounts owing under
this Lease would have been payable if possession had not been retaken and
Landlord will be entitled to receive the rent and other amounts from Tenant
on each such day. Landlord will make reasonable efforts to mitigate damages
by finding a suitable tenant.
(D) In the case of an "Event of Bankruptcy" as defined in paragraph
(A)(6) above Landlord and Tenant agree as follows:
(1) ASSUMPTION OF LEASE. The Trustee of Tenant's bankruptcy
estate or Tenant as debtor-in-possession may assume this Lease, and may
subsequently assign it, only if it does the following within 60 days after
the date of the filing of the voluntary petition, the entry of the order
for relief or the date of conversion or such additional time as a court of
competent jurisdiction may grant, for cause, upon a motion made within the
original 60 day period:
(a) file a motion to assume this Lease with the appropriate court;
and,
(b) satisfy all of the following conditions, which Landlord and
Tenant acknowledge to be commercially reasonable:
(I) cure all defaults under this Lease or provide Landlord with
Adequate Assurance (see section (2)(a) below) that:
8
9
(A) it will cure all monetary defaults under the Lease within 10
days from the date of the assumption; and
(B) it will cure all nonmonetary defaults under the Lease within
30 days from the date of the assumption; and,
(c) compensate Landlord and any other person or entity, or provide
Landlord with Adequate Assurance (see section (2)(a) below) that within 10
days after the date of the assumption, it will compensate Landlord and such
other person or entity, for any pecuniary loss that Landlord and such other
person or entity incurred as a result of the default of Tenant, the trustee
or the debtor-in-possession; and,
(d) provide Landlord with Adequate Assurance of Future Performance
(see section (2)(b) below) of all of Tenant's obligations under the Lease;
and,
(e) deliver to Landlord a written statement that the conditions in
this section 1 have been satisfied.
(2) ADEQUATE ASSURANCE, ADEQUATE ASSURANCE OF FUTURE PERFORMANCE.
(a) ADEQUATE ASSURANCE. For purposes of section 1 above, and
in addition to any other requirements under the Bankruptcy Code, any future
federal bankruptcy law and applicable case law, "Adequate Assurance" means
at least:
(i) entering an order segregating sufficient cash to pay
Landlord and any other person or entity under section 1
above.
(B) ADEQUATE ASSURANCE OF FUTURE PERFORMANCE. For purposes of
section 1 above, and in addition to any other requirements under the
Bankruptcy Code, any future federal bankruptcy law and applicable case law,
Adequate Assurance of Future Performance means at least:
(i) the trustee or debtor-in-possession depositing with
Landlord, as security for the timely payment of rent and
other monetary obligations, an amount equal to the sum of
two (2) months rent; and,
(ii) the trustee or debtor-in-possession providing adequate
assurance of the source of the rent and other consideration
due under the Lease; and
(iii)Tenant's bankruptcy estate and the trustee or
debtor-in-possession providing adequate assurance that the
bankruptcy estate (and any successor after the conclusion of
the Tenant's bankruptcy proceedings) will continue to have
sufficient unencumbered assets after the payment of all
secured obligations and administrative expenses to assure
Landlord that the bankruptcy estate (and any successor after
the conclusion of the Tenant's bankruptcy proceedings) will
have sufficient funds to fulfill Tenant's obligations under
the Lease and to keep the Premises stocked with product and
properly staffed with sufficient employees to conduct a
fully-operational and active business on the Premises.
(3) ASSIGNMENT OF LEASE.
(A) GENERAL. If the Trustee or the debtor-in-possession assumes
this Lease as stated above and under applicable bankruptcy law, it may
assign its interest in this Lease only if the proposed assignee first
provides Landlord with Adequate Assurance of Future Performance of all of
Tenant's obligations under this Lease and if Landlord determines, in the
exercise of its reasonable business judgment, that the assignment of this
Lease will not:
(i)breach any other lease, mortgage, financing agreement, or
other agreement relating to the Premises, by which Landlord is
bound and Landlord is not required to obtain consents or waivers
from any third party required under any lease, mortgage,
financing agreement, or other agreement by which Landlord is
bound.
9
10
(B) ADEQUATE ASSURANCE OF FUTURE PERFORMANCE. For purposes only
of Section (3)(a) above, and in addition to any other requirements under
the Bankruptcy Code, any future federal bankruptcy law and applicable case
law, "Adequate Assurance of Future Performance" means at least the
satisfaction of the following conditions, which Landlord and Tenant
acknowledge to be commercially reasonable:
(i) the proposed assignee submitting a current financial statement,
audited by a certified public accountant, that shows a net worth
and working capital in amounts determined in the reasonable
business judgment of Landlord to be sufficient to assure the
future performance by the assignee of Tenant's obligations under
the Lease;
(ii) If requested by Landlord in the exercise of its reasonable
business judgment, the proposed assignee obtaining a guarantee,
in form and substance satisfactory to Landlord, from one or more
persons who satisfy Landlord's standards of creditworthiness.
(E) CUMULATIVE REMEDIES. Suit or suits for the recovery of rents,
items or additional rent and damages may be brought by Landlord, from time
to time, at Landlord's election, and nothing in this Lease will be deemed
to require Landlord to await the date on which the term of this Lease
expires. Each right and remedy in this Lease will be cumulative and will be
in addition to every other right or remedy in this Lease or existing at law
or in equity or by statute or otherwise, including, without limitation,
suits for injunctive relief and specific performance. The exercise or
beginning of the exercise by Landlord of any such rights or remedies will
not preclude the simultaneous or later exercise by Landlord of any other
such rights or remedies. All such rights and remedies are cumulative and
nonexclusive.
14. REPAIRS BY TENANT. Tenant will, at its sole cost and expense,
maintain the Premises and make repairs, restorations, and replacements to
the Premises, including without limitation the heating, ventilating, air
conditioning, mechanical, electrical, plumbing systems and the fixtures and
appurtenances to the Premises as and when needed to preserve them in good
working order and condition regardless of whether the repairs,
restorations, and replacements are ordinary or extraordinary, foreseeable
or unforeseeable, capital or noncapital, or the fault or not the fault of
Tenant, its agents, employees, invitees, visitors and contractors,
excepting such repairs required due to the negligence of Landlord or its
agents. Tenant shall be solely responsible for all penetrations, changes
and alterations that Tenant makes to the roof and all roof repairs within a
ten (10) foot diameter of Tenant's roof penetrations, changes and
alterations. Landlord shall be responsible for the remainder of the roof.
All such repairs, restorations and replacements will be in quality and
class equal to the original work or installations. If Tenant fails to make
such repairs, restorations or replacements, within the time provided for in
paragraph 13(3) of the Lease, Landlord may, at Landlord's option, make them
at the expense of Tenant and such expense will be collectible as additional
rent and will be paid by Tenant within fifteen (15) days after delivery of
a statement for such expense.
15. DELAYS. Whenever a period of time is provided in this Lease for
Landlord or Tenant to do or perform any act or thing, Landlord and Tenant
shall not be liable or responsible for any delays due to strikes, lockouts,
casualties, acts of God, war, governmental regulation or control or other
causes beyond the reasonable control of Landlord or Tenant and the time for
performance specified herein shall be extended for the amount of time
Landlord or Tenant is so delayed.
16. NOTICES. Any notice or demand from Landlord to Tenant or from
Tenant to Landlord shall be in writing and shall be mailed by prepaid
United States registered or certified mail, or personal delivery addressed
to Tenant as follows: 000 Xxxxxx Xxxxx Xxxxxxxxxxx, XX. 00000 and 0000
Xxxxxx Xxxx, Xxxxx 000 Xxxxxxxx, XX. 00000-0000 or such other address as
Tenant shall have last designated by notice in writing to Landlord, and if
to Landlord, as follows: Attn: Xxxxxx X. Xxxxxxx 0000 X. Xxxxxx Xxxx Xxxx
Xxxx Xxxxx, XX. 00000 or such other address as Landlord shall have last
designated by notice in writing to Tenant. The customary return receipt
shall be conclusive evidence of such service.
10
11
17. SUBORDINATION OF LEASE. At the option of Landlord's mortgagee,
this Lease shall be subject and subordinate to any first mortgage or deed
of trust now or hereafter placed upon the Premises provided the mortgagee
or beneficiary under the deed of trust agrees in writing with Tenant that
regardless of any default or breach under such mortgage or deed of trust
this Lease and Tenant's possession shall not be disturbed by the mortgagee
or beneficiary or any other party claiming through or under such mortgage
or deed of trust; provided, however, that Tenant shall observe and perform
Tenant's obligations under this Lease and shall attorn to the mortgagee or
beneficiary of the deed or trust or whomsoever may be lawfully entitled to
the rental payments. Tenant shall execute and deliver whatever documents
may be required for such purposes, so long as the mortgagee or trustee
executes a nondisturbance agreement for Tenant's benefit.
18. QUIET ENJOYMENT. Landlord covenants and agrees with Tenant
that so long as Tenant pays the rent, tax installment and all items of
additional rent and observes and performs all the terms, covenants, and
conditions of this Lease on Tenant's part to be observed and performed,
Tenant may peaceable and quietly enjoy the Premises subject, nevertheless,
to the terms and conditions of this Lease, and Tenant's possession will not
be disturbed by anyone claiming by, through or under Landlord.
19. ESTOPPEL CERTIFICATES. At any time and from time to time,
Tenant agrees, upon request in writing from Landlord, to execute,
acknowledge and deliver to Landlord a statement in writing certifying the
following: 1.) that this Lease is in full force and effect, 2.) the
Lease's commencement and expiration dates, 3.) the amount of rent and
other charges payable under the Lease, and the date to which the rent and
other charges have been paid, 4.) whether the Lease has been modified and
if so under what terms, 5.) whether all the work the Landlord must
perform (if any) has been completed, 6.) whether Tenant believes Landlord
is in default, and if so, how, 7.) whether Tenant has any claims against
Landlord, or any reason Tenant believes it may pay less than the full rent
and all other charges due, and 8.) any other factual data relating to
this Lease or the Premises, which Landlord may reasonably request. If
requested by the Tenant, Landlord will execute and deliver to Tenant, a
written statement indicating Tenant's right to continued and undisturbed
possession and use of the Premises; provided, however, that Landlord shall
not be required to execute such statement if Tenant is in default of any of
the terms and conditions of this Lease.
20. ASSIGNMENT AND SUBLETTING. Without Landlord's prior written
consent, which Landlord agrees will not be unreasonably withheld or
delayed, Tenant will neither assign this Lease in whole or in part nor
sublease all or part of the Premises. If Tenant believes that Landlord has
unreasonably withheld its consent, Tenant's sole remedy will be to seek a
declaratory judgment that Landlord has unreasonably withheld its consent or
an order of specific performance or mandatory injunction of the Landlord's
agreement to give its consent. Tenant will not have any right to damages.
Notwithstanding anything to the contrary contained herein, Tenant may
sublet or assign to any entity affiliated with or related to Tenant without
Landlord's consent.
SUBMISSION OF INFORMATION. If Tenant requests Landlord's consent to
a specific assignment or sublease, Tenant will give Landlord the following:
(I) the name and address of the proposed assignee or subtenant, (II) a
copy of the proposed assignment or sublease, (III) information about the
nature, business and business history of the proposed assignee or
subtenant, and its proposed use of the Premises, and (IV) banking,
financial and other credit information, and references about the proposed
assignee or subtenant sufficient to enable Landlord to determine the
financial responsibility and character of the proposed assignee or
subtenant.
ASSIGNMENT AND SUBLEASE - ADDITIONAL DOCUMENTS TO BE PROVIDED.
Landlord's consent to an assignment or sublease will not be effective
until: a fully executed copy of the instrument of assignment or sublease
has been delivered to Landlord; in the case of an assignment, Landlord has
received a written instrument in which the assignee has assumed and agreed
to perform all of Tenant's obligations in the Lease; and Landlord has
received reimbursement for its reasonable attorneys'
11
12
fees and costs incurred in connection with both determining whether to give
its consent and giving its consent.
NO RELEASE OF TENANT. Landlord's consent to an assignment or
sublease or Tenant's assignment or sublease to any entity affiliated with
or related to Tenant without Landlord's consent will not release Tenant
from the payment and performance of its obligations in the Lease, but
rather Tenant and its assignee will be jointly and severally primarily
liable for such payment and performance. An assignment or sublease without
Landlord's prior written consent will be void at Landlord's option.
ADDITIONAL RENTS. If Tenant enters into an approved sublease or
assignment and said sublease or assignment provides or permits any rent or
other consideration, whether in a lump sum or in periodic installments, in
excess of Tenant's rent then such excess rent or other consideration shall
be paid to Landlord.
Tenant shall not allow or permit any transfer of this Lease, or any
interest under this Lease, by operation of law or convey, mortgage, pledge
or encumber this Lease or any interest in this Lease.
PROHIBITION OF FURTHER ASSIGNMENT OR SUBLEASING. Landlord's consent
to one assignment or sublease will not waive the requirement of its consent
to any subsequent assignment or sublease.
21. RELATIONSHIP OF THE PARTIES. Nothing contained herein shall be
deemed or construed by the parties hereto nor by any third party as
creating the relationship of principal and agent or of partnership or of
joint venture between the parties hereto, it being understood and agreed
that neither the method of computation of rent nor any other provision
contained herein, nor any acts of the parties hereto, shall be deemed to
create any relationship between the parties hereto other than the
relationship of landlord and tenant.
22. APPLICABLE LAW AND CONSTRUCTION. The laws of the state of
Illinois shall govern the validity, performance and enforcement of this
Lease. The invalidity or unenforceability of any provision of this Lease
shall not affect, impair or serve to invalidate any other provisions of
this Lease. Headings contained within the Lease are for convenience only
and do not define, limit or construe the contents of such paragraphs.
23. NO RECORDATION. Tenant's recordation of this Lease or any
memorandum or short form of it will be void and a default under this Lease.
24. FIRE ALARM. Tenant shall maintain and pay for the fire alarm
system which is installed in the Premises and shall keep the same in good
working condition during the term of this Lease. Tenant is responsible for
all repair, upkeep and updating of the fire alarm system to meet all
federal, state, local and municipal laws, rules and regulations which are
currently in effect or hereinafter enacted.
25. ENVIRONMENTAL HAZARDS. Tenant shall not cause or permit the
Premises to be used to generate, manufacture, refine or process Hazardous
Materials (as defined hereinafter), however Tenant may use those Hazardous
Materials that it is allowed to use under any Environmental Law or permit.
Except in accordance with Environmental Laws, Tenant shall not cause or
permit, as a result of any intentional or unintentional act or omission on
the part of Tenant, a material release of Hazardous Materials onto the
Premises or onto any other property or ambient air or waters. For purposes
of this Lease "Hazardous Materials" includes, without limitation, any
flammable explosives, radioactive materials, hazardous materials, hazardous
wastes, hazardous and toxic substances, as those terms are defined in the
Comprehensive Environmental Response Compensation and Liability Act of
1980, as amended (42 U.S.C. Sections 9601, et seq.), The Hazardous
Materials Transportation Act, as amended (49 U.S.C. Sections 1801, et
seq.), The Resource Conservation and Recovery Act, as amended (42 U.S.C.
Sections 9601 et seq.) and in the regulations adopted and publications
promulgated pursuant thereto, and any other
12
13
Environmental Laws. "Release" shall mean that term as it is defined under
CERCLA, 42 U.S.C. Section 9601. "Environmental Laws" shall mean all laws,
regulations, rules or ordinances pertaining to the protection of human
health, safety and the environment.
TENANT'S ENVIRONMENTAL CONDITION NOTIFICATION REQUIREMENTS.
A. NOTIFICATION OF ANY RELEASE OR DISCHARGE. Tenant shall
promptly notify Landlord in writing of any release or discharge of any
Hazardous Materials except where the release or discharge is allowed under
any law, order, regulation or permit.
B. NOTIFICATION OF ANY NOTICE, INVESTIGATION OR CLAIM. Upon
receipt of any written notice or claim, Tenant shall also promptly notify
Landlord in writing of, and contemporaneously provide Landlord with a copy
of any written notice or claim received by Tenant related to any
enforcement, cleanup, removal or other action that is instituted or
threatened by a governmental or regulatory agency against Tenant or any
subtenant or other occupant of the Premises; and that relates to the
release or discharge of Hazardous Materials on or from the Premises;
(i) Any claim that is instituted or threatened by any third party
against Tenant or any subtenant or other occupant of the Premises and that
relates to any Release of Hazardous Materials on or from the Premises; and
(ii) Any notice of the loss of any material environmental
operating permit by Tenant.
C. FAILURE TO COMPLY. Failure to comply with this paragraph shall
constitute a default under this Lease. In the event of such default,
Landlord shall have all rights available under paragraph 13 of this Lease
and all rights at law or equity including, without limitation, the right to
either:
(i) Terminate this Lease and collect damages Landlord incurs as a
result of such default, including, without limitation, cleanup costs of any
Hazardous Materials released into the Premises, soil or groundwater during
Tenant's occupancy of the Premises; or
(ii) Require the cleanup of such Hazardous Materials to levels
applicable to commercial/industrial properties at Tenant's sole expense
while still enforcing all of the other terms and obligations of this Lease.
D. SURVIVAL. The remediation and indemnification obligations of
this paragraph shall survive the expiration or earlier termination of this
Lease.
ENVIRONMENTAL REPRESENTATIONS AND WARRANTIES. Landlord, to the best
of its knowledge, warrants to Tenant that the Premises are free from the
presence of Hazardous Materials and that the handling, use, generation,
treatment, storage, disposal or Release of Hazardous Materials has not
occurred on the Premises. Landlord further warrants, to the best of
Landlord's knowledge, that the Premises are, and at all times have been, in
full compliance with all Environmental Laws and that there are no
conditions or occurrences at the Property which could form the basis of any
Environmental Claim against the Landlord or Tenant or the Property. For the
purposes of this Lease, "Environmental Claim" shall mean any investigation,
notice, violation, demand, lawsuit, injunction, fine, lien, or other claim
based on liability for the presence of a Hazardous Material on the Premises
or a violation of any Environmental Law. Landlord further warrants that it
has not received notice of any pending or threatened action, claim or
proceeding under Environmental Laws or otherwise arising out of the
condition of the Premises. Landlord warrants that the Premises do not
contain and has not contained any (a) underground storage tank; (b)
asbestos-containing material; (c) any environmental contamination; or (d)
any Hazardous Material. All warranties of Landlord in this paragraph shall
be "Landlord's Environmental Warranties".
Tenant warrants, to the best of its knowledge, that it is currently in
material compliance with all applicable Environmental Laws and that there
are no pending Environmental Claims involving alleged violations by Tenant
of any Environmental Laws and relating to or affecting any of Tenant's
existing
13
14
facilities or the Premises. All warranties of Tenant in this paragraph
shall be "Tenant's Environmental Warranties".
ENVIRONMENTAL INDEMNITY. Landlord agrees to indemnify, save and hold
harmless Tenant, from and against any and all costs, losses, liabilities,
damages, lawsuits, expenses, interest, and penalties incurred in connection
with, arising out of, resulting from or incident to a breach of any
environmental warranty contained herein. The provisions of this paragraph
shall survive the term of this Lease.
Tenant shall and hereby does indemnify Landlord and hold and defend
Landlord harmless from and against any and all reasonable and actual
expense, loss and liability suffered by Landlord by reason of Tenant's
breach of any of the provisions of this Section 25 and any breach of
Tenant's Environmental Warranties and any breach of Environmental Laws.
Such expenses, losses and liabilities shall include, without limitation,
(i) any and all expenses that Landlord may incur to comply with any
Environmental Laws as a result of Tenant's failure to comply therewith and
with this Lease; (ii) any and all costs that Landlord may incur in studying
and remedying any contamination at or arising from the Premises as a result
of a failure by Tenant to comply with this Section 25 or Environmental
Laws; (iii) any and all costs that Landlord may incur in studying,
removing, remediating, disposing or otherwise addressing any Hazardous
Materials which are present at the Premises as a result of a failure of
Tenant to comply with this Section 25 or Environmental Laws; (iv) any and
all fines, penalties or other sanctions assessed upon the Premises, the
Real Estate of which the Premises are a part thereof, or Landlord by reason
of Tenant's failure to comply with this Section 25 and Environmental Laws;
and (v) all claims for personal injury (including wrongful death) or
property damage (real and personal) as a result of a failure of Tenant to
comply with this Section 25 or Environmental Laws, and (vi) any and all
reasonable legal and professional fees and costs incurred by Landlord in
connection with the foregoing. The indemnity contained herein shall survive
the expiration or earlier termination of this Lease.
ENVIRONMENTAL AUDIT. Within the first thirty (30) days of this
Lease, Landlord shall provide Tenant with a Phase I environmental study
performed by a properly licensed consultant and done in compliance with
ASTM Standard E1527-97 stating that the Premises are clean and free of any
Recognized Environmental Condition. If the Phase I reveals any Recognized
Environmental Condition is present on the Premises, Tenant may terminate
this Lease and Landlord will return Tenant's security deposit and this
Lease will be null and void. Within thirty (30) days of the expiration or
earlier termination of this Lease Tenant will provide Landlord with a Phase
I environmental study performed by a properly licensed consultant and done
in compliance with ASTM Standard E1527-97 stating that the Premises are
clean and free of any Recognized Environmental Conditions caused by any act
or omission of Tenant. For purpose of this Lease "Recognized Environmental
Condition" shall mean that term as it is defined in ASTM Standard E
1527-97. If the Phase I reveals any Recognized Environmental Condition
resulting from a breach of this Lease, then Tenant shall conduct a Phase II
environmental audit and shall remain liable for any environmental
contamination and shall cleanup any Hazardous Material Contamination to
standards applicable to industrial/commercial properties in Illinois. The
obligations set forth in this paragraph shall survive the expiration or
earlier termination of the Lease.
26. RULE OF CONSTRUCTION. Landlord and Tenant understand, agree
and acknowledge that; (a) this Lease has been freely negotiated by both
parties; and (b) that, in any controversy, dispute, or contest over the
meaning, interpretation, validity, or enforceability of this Lease or any
of its terms or conditions, there shall be no inference, presumption or
conclusion drawn whatsoever against either party by virtue of that party
having drafted this Lease or any portion thereof.
27. INDEMNITY FOR LITIGATION. The losing party shall pay to the
prevailing party all costs and expenses, including reasonable attorney's
fees, which are incurred or imposed upon the prevailing party, either in
enforcing the terms of this Lease or in any litigation to which the
prevailing party, becomes a party to due to this Lease.
14
15
28. INDEMNITY AND WAIVER. Tenant will indemnify and save Landlord
harmless (if Landlord is a trustee, the term "Landlord" for purposes of
this paragraph, shall include the trustee, its agents, its beneficiaries
and their agents) from and against all damages, losses, costs, expenses,
liabilities, obligations, including reasonable attorneys' fees and
expenses, claims and causes of action of any and every kind and nature
arising or growing out of or in any way connected with Tenant's use,
occupancy, management or control of the Premises, including without
limitation, (A) any accident, injury to or death of persons or loss of or
damage to property occurring on the Premises, resulting from an act or
omission of Tenant or anyone claiming by, through or under Tenant; (B) any
failure on the part of Tenant to perform or comply with any of the terms of
this Lease; and (C) performance of any labor or services or the furnishing
of any materials or other property in respect to the Premises. However,
Tenant shall not be responsible for any acts or negligence caused by
Landlord or its agents, unless Landlord or its agents are under the
direction of Tenant.
29. ACCESS TO PREMISES. Tenant agrees that Landlord and Landlord's
agents and employees may enter the Premises during normal business hours
and upon prior notice for the purpose of inspecting the Premises or to
exhibit the Premises for the purpose of sale, mortgage or lease. During the
last year of the term of this Lease, Landlord may display on the Premises
"For Sale" or "For Lease" signs.
30. SURRENDER. Tenant shall, upon the expiration of the term of
this Lease, or any earlier termination of this Lease for any cause: (A)
Surrender to Landlord the Premises, including without limitation, all
building apparatus and equipment, all alterations, improvements and
additions on the Premises. Tenant may remove its trade fixtures, signs and
other personal property and inventory; (B) The Premises shall be
surrendered to Landlord by Tenant without any damage, injury or disturbance
thereto, reasonable wear and tear excepted. Tenant, at its expense, shall
immediately repair any damage to the Premises caused by Tenant vacating the
Premises and by Tenant's removal of trade fixtures and personal property
and shall leave the Premises in a neat and clean condition, free of debris.
Any property not so removed shall be deemed to have been abandoned by
Tenant and may be retained or disposed of by Landlord, at Tenant's cost
which shall be additional rental due hereunder, as Landlord shall desire,
without any obligation to account therefor to Tenant. Tenant's obligation
to observe and perform any of the provisions of this paragraph shall
survive the expiration or earlier termination of this Lease.
HOLDING OVER. If Tenant remains in possession of the Premises after
the expiration or other termination of this Lease, then such event shall be
deemed to be a month to month tenancy at a rental equal to two (2) times
the then current rental rate. Nothing contained in this paragraph shall be
construed to give Tenant the right to hold over at any time, and Landlord
may exercise any and all rights and remedies at law or in equity to recover
possession of the Premises. Tenant shall be responsible for all
consequential damages to Landlord as a result of Tenant's failure to
surrender the Premises in accordance with this Lease and this clause shall
survive the expiration or earlier termination of this Lease.
31. SECURITY DEPOSIT. Tenant has deposited $15,000.00 with
Landlord as security for Tenant's payment of rent, all items of additional
rent and performance of its obligations under this Lease. If Tenant
defaults in its payment of rent, items of additional rent or performance of
its other obligations under this Lease, Landlord may use all or part of the
security deposit for the payment of rent or any other amount in default, or
for the payment of any other amount that Landlord may spend or become
obligated to spend by reason of Tenant's default. If Landlord so uses any
portion of the security deposit, Tenant will restore the security deposit
to its original amount within five (5) days after written demand from
Landlord. Landlord will not be required to keep the security deposit
separate from its own funds and Tenant will not be entitled to interest on
the security deposit. The security deposit will not be a limitation on
Landlord's damages or other rights under this Lease, or a payment of
liquidated damages, or an advance payment of rent. If Tenant pays the rent,
all items of additional rent and performs all of its other obligations
under this Lease, Landlord will return the unused portion of the security
deposit to Tenant within sixty (60) days after the expiration of this
Lease.
15
16
32. AMENDMENT. This Lease can be amended only by a written
document signed by Landlord and Tenant.
33. SEVERABILITY. If any provision of this Lease is found by a
court of competent jurisdiction to be illegal, invalid, or unenforceable,
the remainder of this Lease will not be affected, and in lieu of each
provision which is found to be illegal, invalid, or unenforceable, there
will be added as a part of this Lease a provision as similar to such
illegal, invalid or unenforceable provision as may be possible and be
legal, valid and enforceable.
34. BINDING EFFECT. This Lease will inure to the benefit of, and
will be binding upon, Landlord's successors and assigns. This Lease will
inure to the benefit of, and will be binding upon, Tenant's successors and
assigns so long as the succession or assignment is permitted and approved
according to the assignment and subletting paragraph above.
35. CAPTIONS AND TITLES. The captions and titles used in this
Lease are for convenience only and do not define, limit or describe the
scope or intent of any provision of this Lease. Unless the context clearly
requires otherwise, the singular includes the plural, and vice versa, and
the masculine, feminine, and neuter adjectives include one another.
36. ENTIRE AGREEMENT. This Lease contains the entire agreement
between Landlord and Tenant with respect to its subject matter and may be
amended only by subsequent written agreement between Landlord and Tenant.
Except for those which are set forth in this Lease, no representations,
warranties, or agreements have been made by Landlord or Tenant to one
another with respect to this Lease.
37. AUTHORITY. If Tenant signs this Lease as a corporation, each
of the persons executing this Lease on behalf of Tenant warrants to
Landlord that Tenant is a duly authorized and existing corporation, that
Tenant is qualified to do business in the state of Illinois, that Tenant
has full right and authority to enter into this Lease and that each and
every person signing on behalf of Tenant is authorized to do so. Upon
Landlord's request, Tenant will provide evidence satisfactory to Landlord
confirming these representations.
If Landlord is a corporation, then Landlord warrants to Tenant that
Landlord is a duly authorized and existing corporation, qualified to do
business in the state of Illinois and Landlord has full right and authority
to enter into this Lease and each person signing on behalf of Landlord is
authorized to do so. Landlord is the sole owner of the Premises.
38. SIGNAGE. No sign, advertisement or notice shall be inscribed,
painted, affixed, or displayed on the windows or exterior walls of the
Premises, except in such places, numbers, sizes, colors and styles as are
approved in advance in writing by Landlord, such approval shall not be
unreasonably withheld, delayed or conditioned, subject always to the
condition that all signs must conform to all applicable laws and ordinances
affecting the Premises. Any and all permitted signs shall be installed,
maintained and removed by Tenant at Tenant's sole expense.
39. LANDLORD'S WORK AND TENANT'S WORK. Landlord will patch and
repair the warehouse floor where needed and will have all of the lights in
working order. Tenant will have the entire warehouse floor professionally
cleaned and sealed. Tenant will have the walls and ceiling in the warehouse
power washed. Landlord will remove the current tenant's name from the
building, replace all discolored ceiling tiles in the office, repair the
roof leak in the office area and relocate the two north gas-fired units to
their original position.
THIS LEASE IS SIGNED THIS 7TH DAY OF AUGUST 1998.
16
17
/S/ XXXXXX X. XXXXXXX /S/ XXXXXXXXX X. XXXXXXX
--------------------------------- -------------------------------
LANDLORD, XXXXXX X. XXXXXXX LANDLORD,XXXXXXXXX X. XXXXXXX
XXXXXXXXXX XXXXXXXX XXXXXXXXXX XXXXXXXX
--------------------------------- -------------------------------
ATTEST ATTEST
/S/ XXX X. XXXXXXXX
---------------------------------
TENANT, XXXXXXXX MICRO SCIENCE, INC.
BY: XXX X. XXXXXXXX, DIRECTOR OF U.S. OPERATIONS
/S/ XXXXX XXXXX
---------------------------------
ATTEST
17
18
EXHIBIT "A"
Lot 13 in Willowbrook Executive Plaza, being a Subdivision of part of the
Southeast Quarter of Xxxxxxx 00, Xxxxxxxx 00 Xxxxx, Xxxxx 00, Xxxx of the Third
Principal Meridian, according to the Plat thereof recorded July 8, 1975 as
Document Number R75-33298, in DuPage County, Illinois.
