EXHIBIT 10.16
Assignment and Assumption
Assignment and Assumption dated as of January 1, 2000 by and among
Allied Digital Technologies Corp., a Delaware corporation having an office at 00
Xxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000 ("Assignor"), Disc Graphics, Inc., a
Delaware corporation having an office at 00 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx
00000 ("Assignee") and Xxx Xxxxxxx and Xxxxx Xxxxxxx, having an address of 16076
Villa Vizcaya, Xxxxxx Xxxxx, Xxxxxxx 00000 (collectively, "Landlord").
RECITALS
A. Landlord, as landlord, and Assignor, as tenant, are parties to a
lease dated as of November 15, 1996 (the "Lease"), covering the building located
at 00 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000 and more particularly described
on Exhibit A attached hereto and made a part hereof (the "Premises").
B. Assignor desires to assign to Assignee all of Assignor's right,
title and interest in and to the Lease and is about to enter into a Sublease of
even date herewith between Assignee, as sublandlord, Assignor, as subtenant, for
the premises located at 000 Xxxxx Xxxxxxx, Xxxxxxxxx, Xxx Xxxx (the "903
Sublease") as more particularly described in the Sublease.
C. Assignee desires to assume all of Assignor's rights and obligations
in, to and under the Lease from and after the date hereof, and to enter into the
903 Sublease.
Accordingly, Assignor, Assignee and Landlord agree as follows:
1. Assignor hereby assigns to Assignee all of Assignor's right, title
and interest in and to the Lease. Assignor hereby represents and warrants to
Assignee that: (i) the Lease is in full force and effect, (ii) Assignor has
received no written notice of default (that remains uncured beyond any
applicable notice and cure period) from the landlord under the Lease, (iii)
Assignor has not assigned, encumbered or otherwise transferred any interest of
Assignor as tenant under the Lease nor subleased any space demised by the Lease,
(iv) Assignor has performed all of its material or monetary obligations under
the Lease, and (v) no event has occurred or failed to occur which, with the
giving of notice or the passage of time, or both, would constitute a default
under the Lease by Assignor.
2. Assignee hereby assumes all of Assignor's obligations in, to and
under the Lease arising or accruing on or after the date hereof and shall
defend, indemnify and hold harmless Assignor from all costs, damages,
liabilities and expenses (including, without limitation, reasonable attorneys'
fees) imposed upon or incurred by Assignor by reason of Assignee's failure to
perform Assignor's obligations under the Lease arising or accruing on or after
the date hereof.
3. Assignor shall defend, indemnify and hold harmless Assignee from
all costs, damages, liabilities and expenses (including, without limitation,
reasonable attorneys' fees) imposed upon or incurred by Assignee by reason of
Assignor's failure to perform Assignor's obligations under the Lease arising or
accruing prior to the date hereof.
4. Upon the full execution and delivery of this Agreement and the
Sublease to Assignor, Assignor shall (i) pay to Landlord a sum equal to
$171,118.00 (representing the amount equal to $250,000.00 less $78,882.00
representing additional rent previously paid by Assignor to Landlord for real
estate taxes (the "Prepaid Real Estate Taxes")) and (ii) release Landlord of its
obligation to refund to Assignor the amount equal to such Prepaid Real Estate
Taxes. As further consideration for Landlord's execution of this Agreement,
Assignor shall pay Landlord a sum equal to $150,000.00 on February 1, 2000 and a
sum equal to $250,000.00 on August 1, 2000 (any such sum paid by Assignor to
Landlord being called the "Cancellation Fee").
5. Articles 3.01 (a), (b) and (c) of the Lease are hereby deleted and
the following is hereby inserted in their place:
"a. For the period January 1, 2000 through July 31, 2000,
$198,070.00 annually, payable in monthly installments of $16,505.83.
b. For the period August 1, 2000 through July 31, 2001,
$206,032.00 annually, payable in monthly installments of $17,169.33.
c. For the period August 1, 2001 through July 31, 2002,
$364,150.00 annually, payable in monthly installments of $30,345.83.
d. For the period August 1, 2002 through July 31, 2003,
$372,430.00 annually, payable in monthly installments of $31,035.83
e. For the period August 1, 2003 through July 31, 2004,
$430,878.00 annually, payable in monthly installments of $35,906.50.
f. For the period August 1, 2004 through July 31, 2005,
$439,494.00 annually, payable in monthly installments of $36,624.50.
g. For the period August 1, 2005 through July 31, 2006,
$444,684.00 annually, payable in monthly installments of $37,057.00.
h. For the period August 1, 2006 through July 31, 2007,
$449,982.00 annually, payable in monthly installments of $37,498.50.
i. For the period August 1, 2007 through January 31, 2008,
$227,220.00 for such period, payable in monthly installments of
$37,870.00."
6. Article 8.01 of the Lease is hereby amended by adding the following
sentence to the end of said Article:
"Notwithstanding the forgoing, Lessee may also use the
premises for the manufacture of printed products and cosmetic and home
care product sampling devices and containers."
7. Article 12.01 of the Lease is hereby amended by adding the
following sub-article:
"i. Notwithstanding the foregoing, Tenant may assign this
Lease or sublet all or a portion of the Premises without Landlord's
prior consent (i) in connection with the sale of substantially all of
Tenant's assets located in the Premises or a sale of Tenant's
business, (ii) in connection with a merger, reorganization or
consolidation of Tenant, or (iii) in connection with a registered
public offering of stock in Tenant."
8. Article 12.01(b) of the Lease is hereby amended by adding the
following language to the beginning of the sub-article:
"Except in connection with an assignment or subletting to an
entity which is a publicly traded company,".
9. For the purposes of Article 20.01 of the Lease, the phrase "the
condition in which [the Premises] was originally delivered to Lessee" shall mean
the condition as it exits on the date hereof.
10. For the purposes of Article 30 of the Lease, all notices to the
Assignee, as lessee, shall be addressed to:
Disc Graphics, Inc.
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxxxxx, CFO
with copy to:
Disc Graphics, Inc.
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx, Esq.
11. To the extent applicable, the fixed rent, additional rent, real
estate taxes, and operating expenses shall be apportioned as of midnight of the
day before the date hereof.
12. For the purposes of Article 17.02 of the Lease, the reference to
Section 18.01 of the Lease is amended to read "Section 17.01."
13. Prior to the date hereof, Assignor shall remove the vacuum pump
and all air compressors from the Premises
14. a. Provided Assignee shall not be in default of its obligations as
sublessor under the 903 Sublease, on or before the delivery date (collectively,
the "Delivery Dates" (or such other date as may be agreed to by Assignor and
Assignee in writing, that date being deemed the respective Delivery Date)) set
forth on the table below, Assignor shall deliver to Assignee the respective area
(collectively, the "Areas", as more particularly described on Exhibit A) in
vacant and broom clean condition.
Delivery Date Area(s)
------------- -------
January 1, 2000 1 & 2
February 16, 2000 3B
March 1, 2000 3A
b. In the event Assignor is unable to deliver any such Area
on its respective Delivery Date (provided, however, if the delivery of
any such Area is delayed past its respective Delivery Date by reason
of acts of God, labor disputes, civil commotion, war, fire or other
casualty, inability to procure materials, governmental regulations,
statutes, ordinances, restrictions or decrees, or other causes beyond
the control of Assignor or Assignee (financial inability excepted)
(collectively, "Force Majeure"), such respective Delivery Date shall
be extended for a period equivalent to the period of such delay from
and after said Delivery Date), Assignor shall pay to Assignee an
amount equal to the sum of (x) $10,000.00 plus (y) $1,000.00 per day
for each day delay thereafter, as liquidated damages for such failure.
If the delivery of any such Area is delayed past the respective
Delivery Date due to (i) any act or omission of Assignee or any of its
employees, agents or contractors or (ii) Assignee's failing to deliver
to Assignor any such space pursuant to the 903 Sublease, then such
Area shall be deemed delivered on the Delivery Date and no liquidated
damages shall be due to Assignee.
c. In the event Assignor shall fail to deliver any such Area
in broom clean condition (other than due to Force Majeure or any act
or omission of Assignee or any of its employees, agents or
contractors), Assignor shall pay Assignee an amount equal to the cost
of making the Area broom clean within 30 days after the date Assignee
delivers to Assignor paid invoices evidencing the payment by Assignee
for such work (which invoices must be delivered by Assignee to
Assignor on or before 15 days following the date of such work).
15. Assignor shall indemnify, defend (by counsel selected by
Assignor), and hold harmless Assignee from and against any and all third party
claims pursuant to any environmental laws arising from or related to the release
of any hazardous or toxic material by Assignor on the Premises during the Lease
term prior to the date hereof. The preceding sentence shall not diminish the
rights or obligations of either party under the common law or any environmental
law.
16. Landlord hereby (a) consents to the execution, delivery and
performance of this Assignment and the Sublease and (b) releases Assignor from
and against any and all claims, obligations and liabilities of every kind or
nature whatsoever arising under or relating to the Lease.
IN WITNESS WHEREOF, this Assignment has been duly executed by the
parties hereto on the day and year first above written.
ASSIGNOR
Allied Digital Technologies Corp.
By: /s/ Xxxxxxx X. XxXxxxxx
---------------------------
Name: Xxxxxxx X. XxXxxxxx
Title: Executive V.P. and CFO
ASSIGNEE
Disc Graphics, Inc.
By: /s/ Xxxxxxxx Xxxxxxxx
-------------------------
Name: Xxxxxxxx Xxxxxxxx
Title: Sr. V.P. and CFO
LANDLORD (except as to the
provisions with respect to
the 903 Sublease)
/s/ Xxx Xxxxxxx
---------------
Xxx Xxxxxxx
/s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx