1
Exhibit 10.32
LEASE
-----
By and Between
XXXXX X. MAY, SR.
("Landlord")
and
MAY MANUFACTURING AND DISTRIBUTING CORP.
("Tenant")
2
TABLE OF CONTENTS
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Page
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ARTICLE 1 PREMISES ....................................................... 1
ARTICLE 2 TERM ........................................................... 1
Section 2.1 Term of Lease .......................................... 1
Section 2.2 Lease Year ............................................. 1
Section 2.3 Option to Renew Lease .................................. 2
ARTICLE 3 QUIET ENJOYMENT ................................................ 2
ARTICLE 4 RENT ........................................................... 2
Section 4.1 Original Term .......................................... 2
Section 4.2 Renewal Term ........................................... 3
ARTICLE 5 USE, ASSIGNMENT, SUBLETTING .................................... 4
Section 5.1 Use of Premises ........................................ 4
Section 5.2 Assignment and Subletting .............................. 4
ARTICLE 6 ALTERATIONS, SIGNS, FIXTURES ................................... 4
Section 6.1 Alterations ............................................ 4
Section 6.2 Tenant's Right to Maintain Signs ....................... 5
ARTICLE 7 MAINTENANCE, REPAIRS AND UTILITIES ............................. 5
Section 7.1 Landlord's Repairs ..................................... 5
Section 7.2 Tenant's Repairs ....................................... 6
Section 7.3 Utilities .............................................. 6
ARTICLE 8 INSURANCE ...................................................... 6
Section 8.1 Tenant's Insurance ..................................... 6
Section 8.2 Indemnity .............................................. 7
Section 8.3 Tenant's Uses .......................................... 7
Section 8.4 Waiver of Subrogation .................................. 7
Section 8.5 Certificates ........................................... 7
Section 8.6 Landlord's Liability ................................... 8
ARTICLE 9 DESTRUCTION .................................................... 8
ARTICLE 10 EMINENT DOMAIN ................................................ 8
ARTICLE 11 TAXES ......................................................... 9
(i)
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ARTICLE 12 DEFAULT ....................................................... 10
ARTICLE 13 HOLDING OVER .................................................. 11
ARTICLE 14 RECORDING AND SUBORDINATION ................................... 11
Section 14.1 Memorandum of Lease and Supplement to Lease ........... 11
Section 14.2 Subordination ......................................... 11
ARTICLE 15 OPTION TO PURCHASE ............................................ 12
ARTICLE 16 GENERAL ....................................................... 16
Section 16.1 Quiet Enjoyment ............................................. 16
Section 16.2 Surrender ................................................... 16
Section 16.3 Access By Landlord .......................................... 17
Section 16.4 Notices ..................................................... 17
Section 16.5 Severability ................................................ 17
Section 16.6 Exhibits .................................................... 17
Section 16.7 Entire Agreement ............................................ 18
Section 16.8 Successors and Assigns ...................................... 18
Section 16.9 Governing Law ............................................... 18
Section 16.10 Relationship of Parties .................................... 18
(ii)
4
LEASE
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THIS LEASE, made as of the 31st day of July, 1996, by XXXXX X. DAY, SR.
(hereinafter called "Landlord"), whose address is 00000 Xxxx Xxxx Xxxxxx #00,
Xxxxxx, Xxxxxxxx 00000 and MAY MANUFACTURING AND DISTRIBUTING CORP., a Colorado
corporation, whose address is 0000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000.
WHEREAS, Landlord and Tenant entered into certain leases dated as of
September 12, 1990 and September 26, 1990 (the "Leases"), as the same may have
been extended or renewed; and
WHEREAS, Landlord and Tenant have reached new agreements concerning the
lease of the premises which were the subject of the Leases;
NOW, THEREFORE, Landlord and Tenant do hereby terminate the Leases
effective as of the "Commencement Date" (defined below) and enter into this
Lease, as follows:
ARTICLE 1 PREMISES
------------------
In consideration of the payment of rent by Tenant, and the keeping and
performance of the covenants and agreements described below by Landlord and
Tenant, Landlord hereby leases to Tenant the building, land and all
appurtenances located at 0000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000 (the
"Premises"), more particularly described on Exhibit A attached hereto and
incorporated herein by reference .
ARTICLE 2 TERM
--------------
Section 2.1 TERM OF LEASE.
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TO HAVE AND TO HOLD the Leased Premises unto Tenant, together with the
appurtenances thereunto belonging, for a term of seven (7) years commencing on
August 1, 1996 (the "Commencement Date") and ending on July 31, 2003 (the
"Expiration Date") .
Section 2.2 LEASE YEAR.
----------- -----------
The term "Lease Year", as used herein, shall mean a period of twelve
(12) consecutive full calendar months. The first Lease Year shall begin on the
Commencement Date if the Commencement Date shall occur on the first day of a
month. Otherwise, the first Lease Year shall commence upon the first day of the
5
calendar month next following the Commencement Date. Each succeeding Lease Year
shall commence upon the anniversary date of the first Lease Year.
Section 2.3 OPTION TO RENEW LEASE.
----------- ----------------------
Tenant may, at its option, at the expiration of the original term of
this Lease, renew this Lease for one (1) renewal term of five (5) years at the
rent specified in Section 4.2 and subject to all of the other.terms and
conditions of this Lease; PROVIDED, HOWEVER, that Tenant's option to renew shall
be subject to the condition that, at the expiration of the original term,
Tenant's right of possession shall not have been terminated by Landlord due to
Tenant's default hereunder, and that Tenant shall have given notice in writing
to Landlord of its intention to exercise its option to renew at least one
hundred eighty (180) days prior to the expiration of the original term.
ARTICLE 3 QUIET ENJOYMENT
-------------------------
Landlord hereby covenants and agrees that if Tenant shall promptly and
faithfully perform all of the covenants and agreements herein stipulated to be
performed on Tenant's part, Tenant shall at all times during said term have the
peaceable and quiet enjoyment and possession of the Premises without hindrance
or claim from any persons lawfully claiming the Premises by or under Landlord
save and except in the event of the taking of the Premises by public or
quasi-public authority as provided in Article 10 below.
ARTICLE 4 RENT
--------------
Section 4.1 ORIGINAL TERM.
----------- --------------
Tenant agrees without demand and without any deduction or set-off to
pay to Landlord at Landlord's office or at such other place as Landlord may from
time to time designate as rent for the Premises during the original term of this
Lease from the Commencement Date through the Expiration Date, the sum of
$141,768 per year payable in equal monthly installments of $11,814 each in
advance on the first day of each and every calendar month; PROVIDED, HOWEVER,
that such rent shall be subject to set-off in accordance with the terms of
Section 10.8 of the Stock Purchase Agreement between Landlord and Wastequip
Manufacturing Company, an Ohio corporation (the "Stock Purchase Agreement") .
Rent for any portion of
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a month shall be prorated based on the actual number of days during such month
occurring within the term.
Section 4.2 RENEWAL TERM.
----------- -------------
In the event Tenant exercises its option for the renewal term, Tenant
agrees without demand and without any deduction or set-off to pay to Landlord at
Landlord's office or at such other place as Landlord may from time to time
designate as rent for the Premises during such renewal term of this Lease rent
in the amount of the "Fair Market Rental" determined as of the first day of such
renewal term; PROVIDED, HOWEVER, that such rent shall be subject to set-off in
accordance with the terms of Section 10.8 of the Stock Purchase Agreement. The
term "Fair Market Rental" as of such date shall be determined by mutual
agreement of Landlord and Tenant. In the event Landlord and Tenant cannot agree
on the Fair Market Rental at least one hundred twenty (120) days prior to the
first day of such renewal term, Landlord and Tenant, at least ninety (90) days
prior to the first day of the renewal term, shall jointly select an M.A.I.
appraiser to determine the Fair Market Rental, or if they cannot agree on one
appraiser, then Landlord and Tenant shall each select one M.A.I. appraiser and
those two appraisers shall attempt to agree within thirty (30) days on the Fair
Market Rental. In the event the two appraisers are unable to agree on the Fair
Market Rental within such thirty (30) day period, but the difference between
their determination is less than five percent (5%) of the higher determination,
the average of the two determinations shall be the Fair Market Rental. In the
event the two appraisers are unable to agree and the difference is more than
five percent (5%) as set forth above, the two appraisers shall, not less than
sixty (60) days prior to the first day of the renewal term, choose a third
M.A.I. appraiser and thereupon the Fair Market Rental shall be determined by the
third appraiser not less than thirty (30) days prior to the first day of the
renewal term. All such M.A.I. appraisers shall have their principal place of
business in the Denver, Colorado area and shall be experienced at appraising
property similar to the Premises. The fees and expenses of the appraisers shall
be paid one-half by Landlord and one-half by Tenant. In determining the Fair
Market
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Rental, the appraisers shall take into account the terms and conditions of this
Lease .
ARTICLE 5 USE, ASSIGNMENT, SUBLETTING
-------------------------------------
Section 5.1 USE OF PREMISES.
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Tenant shall use the Premises as a manufacturing and distribution
facility. Tenant shall not use the Premises for any purpose prohibited by the
laws of the United States or the State of Colorado or the ordinances of the
County of Jefferson. Tenant shall not permit any disorderly conduct, excessive
noise or nuisance on the Premises.
Section 5.2 ASSIGNMENT AND SUBLETTING.
----------- --------------------------
Neither Tenant nor its successors or assigns shall assign, mortgage,
pledge, or encumber this Lease or sublet the Premises in whole or in part, or
permit the Premises to be used or occupied by others, nor shall this Lease be
assigned or transferred by operation of law, without the prior consent in
writing of Landlord, which consent shall not be unreasonably withheld or
delayed; PROVIDED, HOWEVER, that this Lease may be assigned without such consent
to any corporation or other entity controlled by Wastequip, Inc. provided Tenant
remains fully liable hereunder. If this Lease is assigned or transferred, or if
all or any part of the Premises is sublet or occupied by any person or entity
other than Tenant, Tenant shall continue to be liable in accordance with the
terms and conditions of this Lease unless otherwise agreed to in writing.
ARTICLE 6 ALTERATIONS, SIGNS, FIXTURES
--------------------------------------
Section 6.1 ALTERATIONS.
----------- ------------
Tenant may not make any alterations or changes in, upon or about the
Premises without first obtaining the written consent of Landlord, which consent
shall not be unreasonably withheld or delayed. The furnishings, equipment,
machinery and trade fixtures owned by Tenant and installed on the Premises will
remain the property of Tenant and may be removed by Tenant upon the termination
of this Lease, provided that any of such items that are affixed to the Premises
and require severance may be removed only if Tenant repairs any damage caused by
such removal. Notwithstanding the terms of the preceding sentence, any
furnishings, equipment, machinery or trade fixtures listed on Exhibit B attached
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hereto shall be deemed to be a part of the Premises and may not be removed by
Tenant upon the termination of this Lease unless such items are assigned a
positive value on the Closing Financial Statements (as such term is defined in
the Stock Purchase Agreement) or in the related accounting records.
Section 6.2 TENANT'S RIGHT TO MAINTAIN SIGNS.
----------- ---------------------------------
Tenant may place signs of professional quality on the exterior of the
Premises advertising Tenant's business or products and identifying the entrances
and shipping and receiving areas of the Premises provided such signs comply with
any and all applicable governmental laws, rules, and regulations. Tenant agrees
to remove the sign or signs at the expiration or sooner termination of this
Lease, or any renewal or extension thereof, and to repair, at its own expense,
any damage to the Premises caused by such installation or removal.
ARTICLE 7 MAINTENANCE, REPAIRS AND UTILITIES
--------------------------------------------
Section 7.1 LANDLORD'S REPAIRS AND REPLACEMENTS.
----------- ------------------------------------
Landlord shall at its expense make all necessary structural repairs and
replacements to the interior and exterior of the Premises and all necessary
nonstructural repairs and replacements to the exterior of the Premises and to
the roof, foundation and floor of the Premises, including, without limitation,
all necessary repairs and replacements to the water, sewer, gas, electric and
other utility service lines; PROVIDED, HOWEVER, that Landlord shall not be
required to (i) paint any buildings located on the Premises or (ii) repair or
replace any paved areas located on the Premises; PROVIDED FURTHER, Landlord
shall not have any responsibility to repair or replace any portion of the
Premises damaged by Tenant. Landlord also shall reimburse Tenant for any routine
nonstructural repairs or replacements required to be performed by Tenant under
Section 7.2 below to the extent the cost of such repairs or replacements with
respect to any single item exceed the amount of $10,000. Any interpretation of
Landlord's repair and replacement obligations hereunder shall take into account
the age and historical uses of the Premises. Tenant agrees to seek any available
insurance coverage to finance any repairs or replacements prior to requiring
Landlord to satisfy Landlord's repair and replacement obligations hereunder.
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Section 7.2 TENANT'S REPAIRS AND REPLACEMENTS.
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Tenant shall at its expense keep the interior of the Premises in an
orderly and clean condition and do all routine nonstructural repairs and
replacements to such interior and all routine repairs and replacements to any
paved areas located on the Premises; PROVIDED, HOWEVER, that Tenant's
obligations under this section shall not exceed $10,000 with respect to any
single item.
Section 7.3 UTILITIES.
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Tenant agrees to pay for gas, electricity, water and sewage charges
used or incurred by it in or on the Premises to the public utility company
furnishing Tenant such service.
ARTICLE 8 INSURANCE; NON-LIABILITY OF LANDLORD
----------------------------------------------
Section 8.1 TENANT'S INSURANCE.
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(a) At all times during the term of this Lease, Tenant shall, at
Tenant's own expense, keep in full force and effect public liability insurance
in companies acceptable to Landlord, naming both Landlord and Tenant as insured
parties, with a minimum single limit of One Million Dollars ($1,000,000.00).
Tenant shall deposit such policy or policies of insurance, or certificates
thereof, with Landlord.
(b) Tenant shall further maintain all-risk property insurance on its
personal property and trade fixtures located on the Premises to the full
insurable value thereof.
(c) Tenant, at its sole cost and expense, shall keep the Premises with
all improvements thereon insured by all-risk coverage (1) in an amount not less
than the full replacement cost thereof (excluding foundation and excavation
costs) and (2) against such other risks, of a similar or dissimilar nature, as
are or shall be customarily covered with respect to premises similar in
construction, general location, use and occupancy to the Premises, insuring both
Landlord and Tenant and with loss payable in favor of Landlord, as his interest
may appear, without regard to any breach of warranty or other act or omission of
Tenant.
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Section 8.2 INDEMNITY.
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Tenant shall defend and save harmless Landlord from and against any and
all loss, cost, damage, or expense, including attorney's fees, of any nature
whatsoever arising out of or connected with the use or occupancy of the Premises
by Tenant, the materials or things maintained or kept by Tenant, its agents,
employees, guests, invitees and contractors, in or on the Premises, or arising
or alleged to have arisen out of the acts or omissions of Tenant's officers,
agents, employees, guests, invitees and contractors.
Section 8.3 TENANT'S USES.
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Tenant shall pay as additional rent any increase in premiums for
insurance which may be charged during the term of this Lease on the amount of
insurance carried by Landlord on the Premises, if any, which increase arises
from activities carried on or occupancy of the Premises by Tenant, whether or
not Landlord has consented to the same. Tenant shall not permit anything to
occur on the Premises which would render void any insurance carried by Tenant
thereon.
Section 8.4 WAIVER OF SUBROGATION.
----------- ----------------------
The insurance policies carried to insure the Premises and to insure
Tenant's personal property and trade fixtures located on the Premises shall each
include or permit a waiver of all rights of subrogation as set forth below. Each
of the parties agrees to and does hereby waive all rights of recovery and causes
of action against the other party and all persons claiming through or under such
other party, by way of subrogation or otherwise, for any damage to the Premises,
or to any personal property located on the Premises, as the case may be, caused
by any of the perils covered and paid by all-risk coverage insurance policies
(as now or hereafter constituted), notwithstanding that any such damage or
destruction may be due to the negligence of such other party or of the persons
claiming through or under such other party.
Section 8.5 CERTIFICATES.
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Certificates of all policies of insurance to be maintained by Tenant
pursuant to the terms of this Lease, and certificates of all renewals thereof,
shall be delivered to Landlord prior to the commencement of the term of this
Lease, or prior to the expiration of the original policy, as the case may be.
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Each such policy shall contain an endorsement to the effect that the same shall
not be cancelled or the coverage thereunder decreased without thirty (30) days'
notice to Landlord.
Section 8.6 LANDLORD'S LIABILITY.
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Tenant shall not attempt to hold Landlord liable for injury or damage to
the Premises or to persons thereon for any cause other than the willful acts
or gross negligence of Landlord.
ARTICLE 9 DESTRUCTION
---------------------
If the Premises are damaged or destroyed in part by fire or other
casualty ordinarily insurable under all-risk coverage insurance in Colorado
during the term hereof, Landlord will repair and restore the same to good
tenantable condition with reasonable dispatch. The rent herein provided shall
xxxxx entirely in case the entire Premises are untenantable, and pro rata for
any portion rendered untenantable in case a part only is untenantable, until the
same be restored to a tenantable condition. In the event of a partial
destruction of the Premises during the term from any cause, Landlord shall
forthwith repair the same, provided the repairs can be made within one hundred
twenty (120) days under the laws and regulations of applicable governmental
authorities. Any partial destruction shall neither annul nor void this Lease,
except that Tenant shall be entitled to a proportionate reduction of rent while
the repairs are being made, any proportionate reduction being based on the
extent to which the damage or the making of repairs shall interfere with the
business carried on by Tenant on the Premises. In the event the Premises shall
be destroyed to the extent of more than thirty percent (30%) of the value
thereof, either Landlord or Tenant may at its option terminate this Lease by
written notice to the other party.
ARTICLE 10 EMINENT DOMAIN
-------------------------
Rights and duties in the event of condemnation are as follows:
(a) If the whole of the Premises shall be taken or condemned by any
competent authority for any public or quasi-public use or purpose, this Lease
shall cease and terminate as of the date on which title shall vest in that
authority, and Tenant's rent shall be apportioned and paid up to that date.
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(b) If only a portion of the Premises shall be taken or condemned, this
Lease shall not terminate, but the rent payable after the date on which Tenant
shall be required to surrender possession of such portion shall be reduced in
proportion to the decreased use suffered by Tenant as the parties may agree or
as shall be determined by arbitration.
(c) In the event of any taking or condemnation in whole or in part, the
entire resulting award of consequential damages shall belong to Landlord without
any deduction for the value of the unexpired term of this Lease or for any other
estate or interest in the Premises now or later vested in Tenant. Tenant hereby
assigns to Landlord all its right, title and interest in any and all such
awards. However, nothing herein contained shall be construed to prevent Tenant
from asserting against the condemnor any separate and independent claims for
damages occurring by reason of said condemnation for personal property,
business, goodwill, cost of removing equipment, or moving expenses.
(d) In the case of any such taking or condemnation referred to in this
section, then if and when there is an actual taking of physical possession of
the Premises or of any part thereof in excess of thirty percent (30%) of the
total floor area thereof, then either Landlord or Tenant may cancel and
terminate this Lease as to the whole of the Premises by giving notice to the
other party within ten (10) days after such actual taking of physical
possession.
(e) If this Lease is not terminated as above provided following any of
said actual takings, then Landlord shall repair the buildings located on the
Premises at its own expense; provided, however, that Landlord's obligation to
repair shall be limited to the amount of award actually received by it for such
taking.
ARTICLE 11 TAXES
----------------
Tenant shall report and pay promptly all taxes, fees and assessments
levied on the Premises by any foreign, federal, state or local government or
taxing authority which are allocable to the period of Tenant's occupancy of the
Premises; PROVIDED, HOWEVER, that in the event any such taxes or assessments are
payable in installments, Landlord shall elect to cause such to be paid over the
longest period of time and Tenant shall be obligated to pay only such
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installments as are allocable to the period of Tenant's occupancy of the
Premises.
ARTICLE 12 DEFAULT
------------------
(a) Landlord may declare in writing this Lease to be in default
if:
(i) Tenant breaches its obligation to pay rent or any other
sum when due and fails to cure such breach within ten (10)
days after written notice thereof (provided, however, that
Landlord shall be required to provide Tenant with notice of
any such breach only one time in any Lease Year and thereafter
during such Lease Year the ten (10) day cure period shall
commence on the date of the breach); or
(ii) Tenant breaches any of its other obligations and fails to
cure such breach within thirty (30) days written notice
thereof; PROVIDED, HOWEVER, that in the event Tenant commences
to cure such non-monetary default within said thirty (30) day
period and proceeds with due diligence, this Lease shall be
extended during the time Tenant is so proceeding with due
diligence to cure; or
(iii) Tenant, or any successor or assignee of Tenant while in
possession, shall file a petition in bankruptcy or insolvency
or for reorganization under any bankruptcy act, or shall
voluntarily take advantage of any such act by answer or
otherwise, or shall make an assignment for the benefit of
creditors; or
(iv) Involuntary proceedings under any bankruptcy law or
insolvency act shall be instituted against Tenant, or if a
receiver or trustee shall be appointed of all or substantially
all of the property of Tenant, and such proceedings shall not
be dismissed or the receivership or trusteeship vacated within
sixty (60) days after the institution or appointment.
(b) Upon an event of default described above, Landlord shall have
any and all the remedies available in accordance with the laws of the State of
Colorado, including but not limited to any of the following:
(i) Landlord shall have the right to cancel and terminate this
Lease;
(ii) Landlord may elect, but shall not be obligated, to make
any payment required of Tenant or comply with any agreement,
term, or condition required to be performed by Tenant, and
Landlord shall have the right to enter the Premises for the
purpose of correcting or remedying any such default and to
remain until the default has been corrected or remedied, but
any correction or remedy by Landlord shall not be deemed to
waive or release the default of Tenant or the right of
Landlord to take any action as may be otherwise permissible in
the case of any default;
(iii) Landlord may re-enter the Premises immediately and
remove the property and personnel of Tenant, and store the
property in a public warehouse or at a place selected by
Landlord, at the expense of Tenant. After re-entry, Landlord
may terminate this Lease on giving thirty (30) days' written
notice of termination to Tenant. Without such notice, re-entry
will not terminate this Lease. On termination, Landlord may
recover from Tenant all damages resulting from the breach,
including the cost of recovering the Premises, and the worth
of the balance of this Lease over the reasonable rental
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value of the Premises for the remainder of the lease term,
which sum shall be immediately due to Landlord from Tenant.
(iv) After re-entry, Landlord may relet the Premises or any
part thereof for any term without terminating this Lease, at
such rent and on such terms as Landlord may choose. If
Landlord shall retake possession of the Premises upon default
by Tenant, it must try in good faith to relet them to another
tenant or tenants, and credit the amount of rent received from
such tenant or tenants, less expenses of reletting, to any
amounts alleged to be due from Tenant. Landlord may make
alterations and repairs to the Premises. The duties and
liabilities of the parties if the Premises are relet shall be
as follows:
(1) In addition to Tenant's liability to Landlord for
breach of this Lease, Tenant shall be liable for all
expenses of the reletting, for the alterations and
repairs made, and for the difference between the rent
received by Landlord under the new lease agreement
and the rent installments that are due for the same
period under this Lease.
(2) Landlord shall apply the rent received from
reletting the Premises (1) to the expenses of the
reletting and alterations and repairs made, (2) to
rent due under this Lease, and (3) to payment of
future rent under this Lease as it becomes due.
(c) If either party resorts to litigation in any court to enforce
the provisions of this Lease, the prevailing party shall be entitled to an award
of reasonable attorneys' fees and costs incurred in the action.
ARTICLE 13 HOLDING OVER
-----------------------
After the expiration of this Lease, if Tenant shall remain in
possession, it shall be deemed a tenancy from month-to-month at a monthly rental
equal to the last monthly installment under this Lease, and subject to all the
terms and conditions of this Lease.
ARTICLE 14 RECORDING AND SUBORDINATION
--------------------------------------
Section 14.1 MEMORANDUM OF LEASE AND SUPPLEMENT TO LEASE.
------------ --------------------------------------------
Landlord and Tenant agree that this Lease shall not be recorded, but
agree to join in the execution of a Memorandum of this Lease which shall make no
reference to the rent payable hereunder, and which Memorandum of Lease shall be
filed for record at Tenant's expense.
Section 14.2 SUBORDINATION.
------------ --------------
This Lease and all rights of Tenant hereunder shall be subject and
subordinate to the lien of any and all mortgages and other encumbrances that may
now or hereafter affect the Premises. Tenant shall on demand execute,
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acknowledge, and deliver to Landlord, without charge, and any all instruments
that may be necessary or proper to subordinate this Lease to the lien of any
such mortgage or encumbrance; PROVIDED, HOWEVER, that it is a condition of such
subordination that Landlord shall deliver to Tenant a non-disturbance agreement
from the holder of any such mortgage or other encumbrance providing in effect
that during such time as Tenant is not in default hereunder, Tenant's rights
under this Lease shall not be effected or disturbed due to any default by
Landlord under such mortgage or exercise of remedy by any such mortgagee (or
other holder of any encumbrance). Landlord further covenants and agrees to
deliver to Tenant such a non-disturbance agreement from the holder of any
existing mortgage on the Premises as of the Commencement Date.
ARTICLE 15 OPTION TO PURCHASE
-----------------------------
Landlord does hereby give and grant to Tenant the right and option to
purchase the Premises at any time during the term or the renewal term (if duly
exercised) provided that Tenant's right to possession under this Lease has not
been terminated due to Tenant's default; PROVIDED, HOWEVER, that Tenant may not
exercise such purchase option until such time as Wastequip Manufacturing Company
("WQMC") has paid in full all principal and accrued interest, or otherwise
satisfied its obligations in full, under both (i) the 7% Convertible
Subordinated Promissory Note in the principal amount of $1,250,000 dated the
same day herewith issued by WQMC to Landlord and (ii) the 9% Nonconvertible
Subordinated Promissory Note in the principal amount of $500,000 dated the same
date herewith issued by WQMC to Landlord. The purchase price (the "Purchase
Price") for the Premises described above shall be the "Fair Market Value"
(defined below) as of the date of exercise. During the thirty (30) day period
after such notice has been given (the "Notice Date"), Landlord and Tenant shall
negotiate to attempt to agree on one appraiser. In the event Landlord and Tenant
cannot agree within such time period on one appraiser to conduct the appraisal,
then Landlord and Tenant shall each select one appraiser (by written notice to
the other) within the sixty (60) day period after the Notice Date, each of whom
shall have one (or more) of the following qualifications:
(i) be an MAI member of the American Institute of Real Estate
Appraisers (or its successor organization, or if
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it no longer exists, an organization with similar requirements
for membership, existing at such time);
(ii) be an SREA or SRPA member of the Society of Real Estate
Appraisers (or its successor organization, or if it no longer
exists, an organization with similar requirements for
membership, existing at such time); and
shall have had at least three (3) years experience within the previous ten (10)
years as a real estate appraiser working in the area of the Premises (a person
meeting such qualifications is hereinafter referred to as a "Qualified
Appraiser") and the two appraisers shall then choose a third appraiser (the
"Third Appraiser"). In the event either Landlord or Tenant shall fail to so
select an appraiser within the time period provided, the appraiser selected by
the other party shall be deemed to be agreed on by both parties pursuant to this
section. The Third Appraiser shall be selected by the two (2) appraisers from a
list of Qualified Appraisers obtained from an organization listed above (or its
successor organization or, if it no longer exists, an organization with similar
requirements for membership, existing at such time) and shall select the Third
Appraiser by each striking in turn an appraiser's name off the list and
continuing to do so until the name of only one appraiser remains, which
appraiser shall be the "Third Appraiser."
The three appraisers thus chosen (or the one appraiser agreed on or
deemed agreed on as provided above) shall each conduct an appraisal of the
Premises and shall independently determine the fair market value of the Premises
as of the Notice Date. The appraiser(s) shall be instructed to complete their
appraisal(s) within ninety (90) days from the date of their designation as
appraisers pursuant to this procedure. Such appraisal shall assume that the
Premises are free from this Lease, but otherwise shall take into account the
location, uses, condition, size, rents payable under any subleases, roads,
drainage, landscaping, utilities, amenities, and taxes and assessments affecting
or concerning the Premises. The three appraisers (or the one appraiser agreed on
or deemed agreed on as provided above) shall then submit their written
appraisals to both Landlord and Tenant. In the event the difference between the
highest and lowest appraisal is less than five percent (5%) of the middle
appraisal, the average of the three appraisals shall be the Appraised Value. In
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the event the difference between the highest and lowest appraisal is more than
five percent (5%) of the middle appraisal, then the appraisal by the Third
Appraiser shall be the Appraised Value. In the event one appraiser has been
agreed on or deemed agreed on as provided above, the appraisal made by such sole
appraiser shall be the Appraised Value. Landlord shall pay the costs and
expenses of the appraiser appointed by Landlord, Tenant shall pay the costs and
expenses of the appraiser appointed by Tenant, and Landlord and Tenant shall
each pay one-half (1/2) the costs and expenses of the Third Appraiser.
The Purchase Price shall be paid in cash to be deposited in and paid
through escrow as provided at the closing.
Tenant shall sell and convey fee simple title to the Premises to Tenant
or Tenant's nominee or designee pursuant to Tenant's written direction (the
"Grantee") by good and sufficient general warranty deed, warranting title to the
Premises to the Grantee free and clear of all liens, claims, tenancies and
encumbrances whatsoever except zoning ordinance, taxes and assessments, both
general and special, not yet due and payable, encumbrances arising by, through,
or under Tenant, those taxes and assessments which were Tenant's obligations
pursuant to this Lease, and except reservations, restrictions and easements of
record existing as of the Commencement Date (the "Permitted Encumbrances") .
The Grantee shall receive at the Grantee's expense an owner's fee
policy of title insurance to be issued by Chicago Title Insurance Company (the
"Title Company") (or such other title company selected by the Grantee and as to
whom the Landlord has no reasonable objection) on ALTA Owner's Form 1970-B (10-
17-70) (or, if such form of policy is unavailable in Colorado at such time
through any title insurance company authorized to issue title insurance in
Colorado, such other form of title insurance policy as the Grantee and the Title
Company may agree to use) insuring title to the Grantee of the Premises free and
clear of all liens, claims, tenancies and encumbrances whatsoever except ongoing
taking(s) (if any) by eminent domain, zoning ordinances, taxes and assessments,
both general and special, not yet due and payable, encumbrances arising by,
through, or under Tenant, those taxes and assessments which were Tenant's
obligations pursuant to this Lease, and the Permitted Encumbrances, in the
amount
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of the Purchase Price or such greater amount as may be designated by the
Grantee. The Grantee and Landlord shall each pay one-half of the expenses of
title examination and the premium for said policy.
This transaction shall be placed into escrow with the Title Company or
an institutional lender designated by the Grantee and reasonably acceptable to
Landlord (in such capacity, the "Escrow Agent"), and this Lease, together with
the Escrow Agent's usual conditions of acceptance, shall serve as escrow
instructions; PROVIDED, HOWEVER, that in the event of any conflict between the
provisions of this Lease and the Escrow Agent's usual conditions of acceptance,
the provisions of this Lease shall govern. All documents fully executed and
funds necessary for the completion of this transaction shall be deposited with
the Escrow Agent on or before the date sixty (60) days after the Fair Market
Value is determined.
When all documents and funds have been deposited into escrow, and the
Title Company can and will upon the filing of the deed for record issue a title
insurance policy as provided for hereinabove, the Escrow Agent shall promptly
file the deed for record and complete this transaction (the "Closing"). The
Grantee and Landlord shall each pay one-half the cost of the title examination,
the premium for the title insurance policy, any transfer taxes and conveyance
fees and the escrow fee.
If the Title Company is unable to issue its title policy provided
herein due to any defects in the title, it shall notify both parties in writing
of the reasons why it is unable to issue such title policy and/or the exceptions
which it would require to be inserted in such title policy if it were issued.
Landlord, within thirty (30) days after the receipt of such notice, shall take
such appropriate steps as are necessary to secure the removal of such defects
from the title; PROVIDED, HOWEVER, that Landlord shall be obligated to cure the
same only if such defects are in the nature of mortgages, judgment liens,
mechanic's liens, or tax or other governmental liens. If the Title Company is
unable to issue such title policy without such exceptions within such thirty
(30) day period, in addition to any then remedies available, the Grantee shall
have the option, to be exercised by the Grantee in writing within twenty (20)
days
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after the expiration of such thirty (30) day period, of either accepting title
to the Premises subject to such defects in the title without an abatement of the
Purchase Price, or terminating its obligations to purchase the Premises. If the
Grantee elects to terminate its obligation to purchase the Premises, the Escrow
Agent shall return all funds and documents deposited with it to the party who so
deposited the same.
ARTICLE 16 GENERAL
------------------
Section 16.1 QUIET ENJOYMENT.
------------ ----------------
Upon due performance of the covenants and agreements to be performed by
Tenant under this Lease, Landlord covenants that Tenant shall, and may at all
times, peaceably and quietly have, hold and enjoy the Premises during the term
of this Lease. If the foregoing covenant of quiet enjoyment shall be breached
and Tenant shall be made a party to any legal proceedings affecting its right of
possession, Landlord will reimburse Tenant for any costs or other expenses
incurred by Tenant in defending its right to this Lease, including, but not
limited to, attorneys' fees and the cost of any such expenses may be charged by
Tenant as an off-set to rent due or to become due. Landlord represents that it
is the owner of the Premises and has the right to enter into this Lease.
Landlord represents that the Premises are fit for their intended use as a
location for a manufacturing company.
Section 16.2 SURRENDER.
------------ ----------
Tenant agrees that at the expiration of this Lease it will surrender
and deliver up the Premises in as good order and condition as when this Lease
commenced (other than loss by fire or other casualty insurable by standard all-
risk coverage insurance, ordinary wear and tear, taking by eminent domain,
failure of Landlord to maintain and repair, and the alterations contemplated or
permitted hereunder). On the last day of the term of this Lease, or on the
sooner termination thereof, Tenant shall peaceably surrender the Premises in
good condition and repair as required hereunder. On or before the last day of
the term of this Lease or the sooner termination thereof, Tenant shall at its
expense remove all of its office furnishings, equipment, supplies, and other
personalty, and any property not removed shall be deemed abandoned.
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Section 16.3 ACCESS BY LANDLORD.
------------ -------------------
Tenant shall permit Landlord to place a "For Rent" sign upon the
Premises at any time during the last thirty (30) days of the lease term, and
shall allow Landlord at any reasonable hour of the business day to enter onto
the Premises for viewing.
Section 16.4 NOTICES.
------------ --------
All notices required or permitted to be given to the parties hereto
shall be given in writing by depositing the same in the United States mail,
postage prepaid, marked "Certified Mail, Return Receipt Requested," and
addressed to the party for which such notice is intended, at the addresses
hereinafter specified, or at such other addresses as either party may
hereinafter designate by notice to the other party:
To Landlord: Xxxxx X. May, Sr.
00000 Xxxx Xxxx Xxxxxx #00
Xxxxxx, Xxxxxxxx 00000
With a copy to: Xxxxxxx X. Xxxxxx, Esq.
000 Xxxxxx Xxxxxx #000
Xxxxxx, Xxxxxxxx 00000
To Tenant: May Manufacturing and Distributing Corp.
c/o Waste-Quip, Inc.
00000 Xxxxxxx Xxxx Xxxxx
Xxxxx 000
Xxxxxxxxx, Xxxx 00000
Attn: Xxxxxx X. Xxxxxxxxx
With a copy to: Xxxxxx, Halter & Xxxxxxxx
0000 XxXxxxxx Xxxxxxxxxx Xxxxxx
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000-0000
Attn: Xxxx X. XxXxxxx, Esq.
Section 16.5 SEVERABILITY.
------------ -------------
If any provision of this Lease or any application thereof shall be
invalid or unenforceable, the remainder of this Lease and any other application
of such provision shall not be affected thereby.
Section 16.6 EXHIBITS.
------------ ---------
All exhibits referred to in, and attached to, this Lease are hereby
made a part of this Lease.
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Section 16.7 Entire Agreement.
------------ -----------------
This Lease represents the entire agreement of the parties and may be
changed only by an agreement in writing signed by the parties hereto.
Section 16.8 SUCCESSORS AND ASSIGNS.
------------ -----------------------
Except as otherwise provided herein, the covenants, terms, conditions,
provisions and undertakings in this Lease or any renewals thereof shall extend
to and be binding upon the successors and assigns of the parties, as if they
were in every case named and expressed, and shall be construed as covenants
running with the land; and wherever reference is made to either of the parties,
it shall be held to include and apply also to the successors and assigns of such
party, as if in each and every case so expressed, except as otherwise provided
herein.
Section 16.9 GOVERNING LAW.
------------ --------------
This lease shall be governed by and construed in accordance with the
laws of the State of Colorado.
Section 16.10 RELATIONSHIP OF PARTIES.
------------- ------------------------
Landlord and Tenant shall not be considered or deemed to be joint
venturers or partners, and neither shall have the power to bind or obligate the
other, except as set forth in this Lease.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of
the day and year first above written.
In the Presence of: LANDLORD: XXXXX X. MAY, SR.
/s/ Xxxx X. Xxxxx /s/ Xxxxx X. May, Sr.
-------------------------------- ----------------------------------
In the Presence of: TENANT: MAY MANUFACTURING AND
DISTRIBUTING CORP.
/s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------- --------------------------------
Its: Treasurer
---------------------------
/s/ Xxxxxxx X. Xxxxx And: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------- -------------------------------
(Both Witnesses as to
Each Signature) Its: Secretary
---------------------------
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STATE OF Colorado )
) SS:
COUNTY OF Denver )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared the above-named Xxxxx X. May, Sr., who acknowledged that he did sign
the foregoing instrument and that the same is his free act and deed.
IN TESTIMONY WHEREOF, I have hereto set my hand and official seal at
DENVER, COLORADO, this 16th day of AUGUST, 1996.
[NOTARY SEAL]
XXXX X. XXXXX /s/ Xxxx X. Xxxxx
NOTARY PUBLIC -----------------------------
STATE OF COLORADO NOTARY PUBLIC
MY COMMISSION EXPIRES: My Commission Expires:
SEPTEMBER 23, 1999
STATE OF OHIO )
) SS:
COUNTY OF CUYAHOGA )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared the above-named May Manufacturing and Distributing Corp., a Colorado
corporation, by Xxxxxxx X. Garda, its Treasurer, and Xxxxx X. Xxxxxxxxx, its
Secretary, who acknowledged that they did sign the foregoing instrument and that
the same is the free act and deed of said corporation and the free act and deed
of each of them as such officers.
IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal at
Cleveland, Ohio, this 26th day of August, 1996.
/s/ Xxxxxxxx X. Xxxxxxx
------------------------------
NOTARY PUBLIC
My Commission Expires:
XXXXXXXX X. XXXXXXX
A NOTARY PUBLIC OF OHIO
MY COMMISSION EXPIRES OCTOBER 30, 1996
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