NET LEASE AGREEMENT
THIS LEASE, made and entered into effective as of this 22nd day
of May, 2002, by and between AEI Income & Growth Fund 24 LLC, a
Delaware limited liability company, whose address is 1300 Minnesota
World Trade Center, 00 Xxxx 0xx Xxxxxx, Xxxxx Xxxx, Xxxxxxxxx 00000
("Lessor"), and Aramark Educational Resources, Inc., dba Children's
World Learning Centers, Inc., a Delaware corporation, whose address is
Attention: Property Controller, Aramark Educational Resources, Inc.,
000 Xxxx Xxxxx Xxxxx, Xxxxxx, Xxxxxxxx 00000 ("Lessee");
WITNESSETH:
WHEREAS, Lessor is the fee owner of a certain parcel of real
property and improvements located at Tinley Park, Illinois and legally
described in Exhibit "A" attached hereto and incorporated herein by
reference; and
WHEREAS, Lessee constructed or caused the construction of the
building and improvements (together the "Building") on the real
property described in Exhibit "A"; and
WHEREAS, Lessee desires to sell said real property and Building
together with any easements and other rights appurtenant thereto (said
real property and Building hereinafter referred to as the "Leased
Premises"), to Lessor and simultaneously lease said real property and
Building, together with any easements and other rights appurtenant
thereto, back from Lessor upon the terms and conditions hereinafter
provided;
NOW, THEREFORE, in consideration of the rents, terms, covenants,
conditions, and agreements hereinafter described to be paid, kept, and
performed by Lessee, Lessor does hereby grant, demise, lease, and let
unto Lessee, and Lessee does hereby take and hire from Lessor and does
hereby covenant, promise, and agree as follows:
ARTICLE 1. LEASED PREMISES
Lessor hereby leases to Lessee, and Lessee leases and takes from
Lessor, the Leased Premises subject to the conditions of this Lease.
ARTICLE 2. TERM
(A) The term of this Lease ("Term") shall be fifteen (15)
consecutive "Lease Years", as hereinafter defined, commencing on the
effective date first written above ("Occupancy Date").
(B) The first "Lease Year" of the Term shall be for a period of
twelve (l2) consecutive calendar months beginning at the Occupancy
Date. If the Occupancy Date shall be other than the first day of a
calendar month, the first "Lease Year" shall be the period of time
from the Occupancy Date to the end of the calendar month of the
Occupancy Date, plus the following twelve (l2) calendar months. Each
Lease Year after the first Lease Year shall be a successive period of
twelve (l2) calendar months.
(C) A short form or memorandum of this Lease has been executed
for recording purposes in the form attached as Exhibit B hereto.
Termination of Lessee's right to possession shall be conclusive
evidence of termination of any option to renew, purchase, or to any
right of first refusal, if any. Entry of a court order terminating
Lessee's right of possession shall be sufficient evidence of the
termination of any rights established by such Memorandum of Lease, and
the Memorandum of Lease shall so state. Abandonment of the Leased
Premises by Lessee shall not be considered a termination of Lessee's
right to possession of the Leased Premises if Lessee continues
maintenance of the Premises and payment of rent under the terms of the
Lease.
ARTICLE 3. RESPONSIBILITY FOR IMPROVEMENTS
(A) Lessee represents, to the best of its knowledge, that the
Building and all other improvements to the land do materially comply
with the applicable laws, ordinances, rules, and regulations of all
state, federal and local governments. Knowledge of Lessee shall be
defined as and limited to the actual knowledge of Xxxx Xxxxx or those
persons immediately under his supervision, limited to Xxxxx Xxxxxxxx
and Xxxxxx Xxxxxxxxx.
(B) Opening for business in the Leased Premises by Lessee shall
constitute an acceptance of the Leased Premises "as is and where is"
and an acknowledgment by Lessee that the premises are in the condition
described under this Lease and that Lessee is responsible for the
correction or repair of any defects or deficiencies in or of the
Premises whether in existence as of the date of this Lease or
discovered after such date, including but not limited to material
compliance with applicable laws, ordinances, rules and regulations of
all state, federal, and local governments.
ARTICLE 4. RENTAL PAYMENTS
A. Annual Rent Payable for the first through Fifth Lease
Years:
For each of the first five Lease Years, Lessee shall pay
to Lessor an annual rent of $180,211.50, which amount
shall be payable in advance without demand on the first
day of each month in equal monthly installments of
$15,017.63 to Lessor. If the first day of the first month
of the Lease Term is not the first day of a calendar
month, then the monthly rental payable for that partial
month shall be a prorated portion of the equal monthly
installment of rent.
B. Annual Rent Payable for the Sixth through Tenth Lease
Years:
The Annual Rent payable for the Sixth through the
Tenth Lease Years shall be the same amount each year and
shall be computed at the beginning of the sixth Lease Year
to be an amount equal to the rent paid for the Fifth Lease
Year, increased by the lesser of ten percent (10%) of the
rent for the Fifth Lease Year, or two hundred percent
(200%) of the "CPI Increase", as defined below, times the
rent for the Fifth Lease Year.
"CPI-U Increase" referred to above is defined as the
percentage increase, if any, in the Consumer Price Index
("CPI") for all Urban Consumers published by the Bureau of
Labor Statistics of the United States Department of Labor
for U.S. City Average, All Items (1982-84=100) from the
nearest date at four months prior to the effective date of
the Lease to the nearest date four months prior to the
last day of the Fifth Lease Year. (For purposes of
determining this increase, the Consumer Price Index for
the fourth month preceding the effective date of the Lease
shall be compared to the CPI for the month that is four
months prior to the end of the Fifth Lease Year.)
C. Annual Rent Payable for the Eleventh through Fifteenth
Lease Years:
The Annual Rent payable for the Eleventh through the
Fifteenth Lease Years shall be the same amount each year
and shall be computed at the beginning of the Eleventh
Lease Year to be an amount equal to the rent paid for the
Tenth Lease Year, increased by the lesser of ten percent
(10%) of the rent for the Tenth Lease Year, or two hundred
percent (200%) of the "CPI Increase", as defined below,
times the rent for the Tenth Lease Year.
"CPI-U Increase" referred to above is defined as the
percentage increase, if any, in the Consumer Price Index
("CPI") for all Urban Consumers published by the Bureau of
Labor Statistics of the United States Department of Labor
for U.S. City Average, All Items (1982-84=100) from the
nearest date four months prior to the last day of the
Fifth Lease Year to the nearest date four months prior to
the last day of the Tenth Lease Year.
D. Annual Rent Payable for the Sixteenth through Twentieth
Lease Years:
The Annual Rent payable for the Sixteenth through the
Twentieth Lease Years shall be the same amount each year
and shall be computed at the beginning of the Sixteenth
Lease Year to be an amount equal to the rent paid for the
Fifteenth Lease Year, increased by the lesser of ten
percent (10%) of the rent for the Fifteenth Lease Year, or
two hundred percent (200%) of the "CPI Increase", as
defined below, times the rent for the Fifteenth Lease
Year.
"CPI-U Increase" referred to above is defined as the
percentage increase, if any, in the Consumer Price Index
("CPI") for all Urban Consumers published by the Bureau of
Labor Statistics of the United States Department of Labor
for U.S. City Average, All Items (1982-84=100) from the
nearest date four months prior to the last day of the
Tenth Lease Year to the nearest date four months prior to
the last day of the Fifteenth Lease Year.
E. Annual Rent Payable for the Twenty-First through Twenty-
Fifth Lease Years:
The Annual Rent payable for the Twenty-First through
the Twenty-Fifth Lease Years shall be the same amount each
year and shall be computed at the beginning of the Twenty-
First Lease Year to be an amount equal to the rent paid
for the Twentieth Lease Year, increased by the lesser of
ten percent (10%) of the rent for the Twentieth Lease
Year, or two hundred percent (200%) the "CPI Increase", as
defined below, times the rent for the Twentieth Lease
Year.
"CPI-U Increase" referred to above is defined as the
percentage increase, if any, in the Consumer Price Index
("CPI") for all Urban Consumers published by the Bureau of
Labor Statistics of the United States Department of Labor
for U.S. City Average, All Items (1982-84=100) from the
nearest date four months prior to the last day of the
Fifteenth Lease Year to the nearest date four months prior
to the last day of the Twentieth Lease Year.
F. Annual Rent Payable for the Twenty-Sixth through Thirtieth
Lease Years:
The Annual Rent payable for the Twenty-Sixth through
the Thirtieth Lease Years shall be the same amount each
year and shall be computed at the beginning of the Twenty-
Sixth Lease Year to be an amount equal to the rent paid
for the Twenty-Fifth Lease Year, increased by the lesser
of ten percent (10%) of the rent for the Twenty-Fifth
Lease Year, or two hundred percent (200%) the "CPI
Increase", as defined below, times the rent for the Twenty-
Fifth Lease Year.
"CPI-U Increase" referred to above is defined as the
percentage increase, if any, in the Consumer Price Index
("CPI") for all Urban Consumers published by the Bureau of
Labor Statistics of the United States Department of Labor
for U.S. City Average, All Items (1982-84=100) from the
nearest date four months prior to the last day of the
Twentieth Lease Year to the nearest date four months prior
to the last day of the Twenty-Fifth Lease Year.
G. Overdue Payments.
Lessee shall pay interest on all overdue payments of
Rent or other monetary amounts due hereunder at a rate
equal to the prime rate (as announced by the Wall Street
Journal newspaper) plus two percent, accruing from the
date such Rental or other monetary amounts were properly
due and payable.
ARTICLE 5. INSURANCE AND INDEMNITY
(A) Lessee shall, throughout the Term or Renewal Terms, if any,
of this Lease, at its own cost and expense, procure and maintain
insurance which covers the Leased Premises and improvements against
fire, wind, and storm damage (including flood insurance if the Leased
Premises is in a federally designated flood prone area) and such other
risks as may be included in the broadest form of extended coverage
insurance as may, from time to time, be available in amounts, subject
to commercially reasonable deductibles, sufficient to prevent Lessor
or Lessee from becoming a co-insurer within the terms of the
applicable policies. In any event, the insurance coverage shall not be
less than one hundred percent (100%) of the then insurable value.
Additionally, replacement cost endorsements, vandalism endorsement,
malicious mischief endorsement, waiver of subrogation endorsement,
waiver of co-insurance endorsement (if available), or equivalent
coverage, shall be obtained.
(B) Lessee agrees to place and maintain throughout the Term or
Renewal Terms, if any, of this Lease, at Lessee's own expense, public
liability insurance in combination with excess/umbrella liability
insurance, with respect to Lessee's use and occupancy of said
premises, with initial limits of at least $5,000,000 combined single
limit for bodily injury and property damage, or such additional
amounts subject to commercially reasonable deductibles, as Lessor
shall reasonably require from time to time.
(C) Lessee agrees to notify Lessor in writing if Lessee is
unable to procure all or some part of the aforesaid insurance. In the
event Lessee fails to provide all insurance required under this Lease,
Lessor shall have the right, but not the obligation, to procure such
insurance on Lessee's behalf. Lessee will then, within ten (10)
business days from receiving written notice, pay Lessor the amount of
the premiums due or paid, together with interest thereon at the
current prime rate plus two percent accruing from the date of such
invoice until paid, which amount shall be considered rent payable by
Lessee in addition to the Rental defined at Article 4 hereof.
(D) All policies of insurance provided for or contemplated by
this Article shall include Lessor and Xxxxxx X. Xxxxxxx, and Lessee
and any mortgagee as additional insured and loss payee, as their
respective interests may appear, and shall provide that the policies
cannot be canceled, terminated, or modified in a manner that
materially adversely affects the insurance required hereunder without
thirty (30) days written notice to the Lessor from Lessee. All
insurance companies must have an A.M. Best rating of "Very Good" or
better. Lessee has provided Lessor with a legible copy of the
applicable insurance certificate(s) and will provide Lessor with
copies of any changes thereto and shall provide evidence no less than
thirty (30) days prior to the expiration, renewal or modification
thereof by current Certificates of Insurance to be delivered in
accordance with this Article.
(E) Lessee shall defend, indemnify, and hold Lessor harmless
against any and all claims, damages, and lawsuits arising after the
Occupancy Date of this Lease and any orders, decrees or judgments
which may be entered therein, brought for damages or alleged damages
resulting from any injury to person or property or from loss of life
sustained in or about the Leased Premises during the Term of this
Lease, and Lessee agrees to save Lessor harmless from, and indemnify
Lessor against, any and all injury, loss, or damage, of whatever
nature, to any person or property caused by, or resulting from any
act, omission, or negligence of Lessee or any employee or agent of
Lessee occurring during the Term of this Lease. In addition, Lessee
hereby releases Lessor from any and all liability for any loss or
damage caused by fire or any of the extended coverage casualties.
Lessor agrees to promptly notify Lessee of all loses or claims for
which it will seek indemnity from Lessee under this Agreement. Lessor
agrees not to incur any cost or expense without the prior approval of
Lessee, and to cooperate with Lessee in the investigation, defense and
settlement of all such claims.
(F) Lessor hereby waives any and all rights that it may have to
recover from Lessee damages for any loss occurring to the Leased
Premises by reason of any act or omission of Lessee; provided,
however, that this waiver is limited to those losses for which Lessor
is compensated by its insurers. Lessee hereby waives any and all right
that it may have to recover from Lessor damages for any loss occurring
to the Leased Premises by reason of any act or omission of Lessor;
provided, however, that this waiver is limited to those losses for
which Lessee is compensated by its insurers.
ARTICLE 6. TAXES, ASSESSMENTS AND UTILITIES
(A) Lessee shall be liable, and agrees to pay the charges for,
all public utility services rendered or furnished to the Leased
Premises, including heat, water, gas, electricity, sewer, sewage
treatment facilities and the like, all personal property taxes, real
estate taxes, special assessments, and municipal or government
charges, general, ordinary and extraordinary, of every kind and nature
whatsoever, which may be levied, imposed, or assessed against the
Leased Premises, or upon any improvements thereon, at any time after
the Occupancy Date of this Lease and prior to the expiration of the
term hereof, or any Renewal Term.
(B) Lessee shall pay all real estate taxes, assessments for
public improvements or benefits, and other governmental impositions,
duties, and charges of every kind and nature whatsoever which shall or
may, during the term of this Lease, be charged, laid, levied,
assessed, or imposed upon, or become a lien or liens upon the Leased
Premises or any part thereof or upon the rents payable hereunder,
except for taxes based solely upon the income of Lessor. Such payments
shall be considered as rent paid by Lessee in addition to the Rent
defined at Article 4 hereof. Lessee shall be deemed to have complied
with the foregoing covenant if payment is permitted without penalty or
interest, or before the same shall become a lien upon the Leased
Premises. If by law any real estate taxes, assessments for public
improvements or benefits, or other governmental impositions, duties,
and charges of every kind and nature whatsoever may at the option of
the taxpayer be paid in installments (whether or not interest shall
accrue on the unpaid balance), Lessee may exercise the option to pay
the same in installments and shall pay such installments as they
become due during the term of this Lease. Lessee shall not be liable
for installments which come due after the termination date of the
Lease. If due to a change in the method of taxation, a franchise tax,
rental tax, or income or profit tax shall be levied against Lessor in
substitution for or in lieu of any tax which would otherwise
constitute a real estate tax, such tax shall be deemed a real estate
tax for the purposes herein and shall be paid by Lessee.
(C) All real estate taxes, assessments for public improvements
or benefits, water rates and charges, sewer rents, and other
governmental impositions, duties, and charges which shall become
payable for the first and last tax years of the term hereof shall be
apportioned pro rata between Lessor and Lessee in accordance with the
respective number of months during which each party shall be in
possession of the Leased Premises in said respective tax years. For
the purposes of this provision, all personal property taxes, real
estate taxes and special assessments shall be deemed to have been
assessed in the year that the first payment or any installment thereof
is due.
(D) Lessee shall have the right to contest or review by legal
proceedings or in such other manner as may be legal (which, if
instituted, shall be conducted solely at Lessee's own expense) any
tax, assessment for public improvements or benefits, or other
governmental imposition aforementioned, at any time until the property
is subject to levy or execution. All such proceedings shall be begun
as soon as reasonably possible after the imposition or assessment of
any contested items and shall be prosecuted to final adjudication with
reasonable dispatch. In the event of any reduction, cancellation, or
discharge, Lessee shall pay the amount that shall be finally levied or
assessed against the Leased Premises or adjudicated to be due and
payable, and, if there shall be any refund payable by the
governmental authority with respect thereto, Lessee shall be entitled
to receive and retain the same, subject, however, to apportionment as
provided during the first and last years of the term of this Lease.
(E) Lessor, within sixty (60) days after notice to Lessee if
Lessee fails to commence such proceedings, may, but shall not be
obligated to, contest or review by legal proceedings, or in such other
manner as may be legal, and at Lessor's own expense, any tax,
assessments for public improvements and benefits, or other
governmental imposition aforementioned, which shall not be contested
or reviewed, as aforesaid, by Lessee, and unless Lessee shall promptly
join with Lessor in such contest or review, Lessor shall be entitled
to receive and retain any refund payable by the governmental authority
with respect thereto.
(F) Lessor shall not be required to join in any proceeding
referred to in this Article, unless in Lessee's reasonable opinion,
the provisions of any law, rule, or regulation at the time in effect
shall require that such a proceeding be brought by and/or in the name
of Lessor, in which event Lessor shall upon written request, join in
such proceedings or permit the same to be brought in its name.
ARTICLE 7. ASSIGNMENT AND SUBLETTING
So long as Lessee shall remain fully liable for the performance
of all obligations of any lessee under this Lease, and if Lessee
provides notice and true and complete copies of all assignments or
sublet agreements to Lessor, then Lessee may assign or sublet this
Lease or the Premises without the prior permission of Lessor.
Lessee shall, prior to the effective date thereof deliver to
Lessor executed counterparts of any such agreement and of all
ancillary agreements with the proposed assignee or sublessee, as
applicable. Lessor shall have the right to require all rental payable
to Lessee under any such subletting or assignment to be payable to
Lessor.
Notwithstanding the foregoing, Lessee shall have the right,
without prior consent of Lessor and without compliance with the
documentation requirements set forth in this Article, to license the
use of, or sublet, all or any portion the Leased Premises to any
person or organization for community, religious, or educational
meetings or other similar purposes, during non-business hours of
Lessee, and all rentals or license fees payable to Lessee under any
such licenses or subleases shall be retained by Lessee.
ARTICLE 8. REPAIRS AND MAINTENANCE
(A) Lessee covenants and agrees to keep and maintain in good
order, condition and repair the interior and exterior of the Leased
Premises during the term of the Lease, and further agrees that Lessor
shall be under no obligation to make any repairs or perform any
maintenance to the Leased Premises. Lessee covenants and agrees that
it shall be responsible for all repairs, alterations, replacements, or
maintenance of the Leased Premises, including but without limitation,
interior and exterior portions of all doors, door checks and
operators, windows, plate glass, plumbing, water and sewage
facilities, fixtures, electrical equipment, interior walls, ceilings,
signs, interior building appliances and similar equipment, heating and
air conditioning equipment, and further agrees to replace any of said
equipment when necessary based upon reasonable facility management
practices. Lessee further agrees to be responsible for, at its own
expense, snow removal, lawn maintenance, landscaping, maintenance of
the parking lot (including parking lines, seal coating, and blacktop
surfacing), and other similar items.
(B) If after written notice and a 90 day cure period (except in
the event of emergencies), Lessee refuses or neglects to commence or
complete repairs promptly and adequately, Lessor may cause such
repairs to be made, but shall not be required to do so, and Lessee
shall pay the cost thereof to Lessor upon demand. It is understood
that Lessee shall pay all expenses and maintenance and repair during
the term of this Lease. If Lessee is not then in default hereunder,
Lessee shall have the right to make repairs and improvements to the
Leased Premises without the consent of Lessor if such repairs and
improvements do not exceed $50,000 provided such repairs or
improvements do not affect the structural integrity of the Leased
Premises. Any repairs or improvements in excess of $50,000 or
affecting the structural integrity of the Leased Premises may be done
only with the prior written consent of Lessor, such consent not to be
unreasonably withheld. All alterations and additions to the Leased
Premises shall be made in accordance with all applicable laws and
shall remain for the benefit of Lessor. Lessee further agrees, in the
event of making such alterations as herein provided, to indemnify and
save harmless Lessor from all expense, liens, claims or damages to
either persons or property or the Leased Premises arising out of or
resulting from the undertaking or making of said repairs,
improvements, alterations or additions, or Lessee's failure to make
repairs required by the terms of this Lease.
ARTICLE 9. COMPLIANCE WITH LAWS AND REGULATIONS
Lessee will materially comply with all statutes, ordinances,
rules, orders, regulations and requirements of all federal, state,
city and local governments, and with all rules, orders and
regulations of the applicable Board of Fire Underwriters which affect
the use of the improvements. Lessee will materially comply with all
easements, restrictions, and covenants of record against or affecting
the Leased Premises required for operation of the Leased Premises in
accordance with Article 14 hereof.
ARTICLE 10. SIGNS
Lessee shall have the right to install and maintain a sign or
signs advertising Lessee's business, provided that the signs conform
to law, and further provided that the sign or signs conform
specifically to the written requirements of the appropriate
governmental authorities.
ARTICLE 11. SUBORDINATION
(A) Lessor reserves the right and privilege to subject and
subordinate this Lease at all times to the lien of any mortgage or
mortgages now or hereafter placed upon Lessor's interest in the Leased
Premises and on the land and buildings of which said premises are a
part, or upon any buildings hereafter placed upon the land of which
the Leased Premises are a part, and to any and all advances to be made
under such mortgages, and all renewals, modifications, extensions,
consolidations, and replacements thereof, provided such a mortgagee
shall execute a reasonably appropriate subordination, attornment and
non-disturbance agreement (which shall include the right to quiet
enjoyment).
(B) Lessee covenants and agrees to execute and deliver, upon
demand, such further reasonable instrument or instruments
subordinating this Lease on the foregoing basis to the lien of any
such mortgage or mortgages as shall be desired by Lessor and any
mortgages or proposed mortgagees.
ARTICLE 12. CONDEMNATION OR EMINENT DOMAIN
(A) If the whole of the Leased Premises are taken by any public
authority under the power of eminent domain, or by private purchase in
lieu thereof, then this Lease shall automatically terminate upon the
date possession is surrendered, and Rent shall be paid up to that day.
If any part of the Leased Premises shall be taken so as to reduce the
licensed capacity of the Premises as a daycare facility by more than
10%, then Lessee shall have the right to terminate this Lease on
thirty (30) days notice to Lessor if given within ninety (90) days
after the date of such taking. In the event that this Lease shall
terminate or be terminated in accordance with this section, the Rent
shall, if and as necessary, be paid up to the day that possession of
the Leased Premises was surrendered.
(B) If any part of the Leased Premises shall be taken such that
it does not reduce the licensed capacity of the facility by more than
10%, then Lessee shall, using proceeds of the award from the taking
authority, restore the remaining portion of the Leased Premises to the
extent necessary to render it satisfactory to Lessee and reasonably
suitable for the purposes for which it was leased. Lessee shall make
all repairs to the building in which the Leased Premises is located to
the extent necessary to constitute the building a complete
architectural unit, provided, however, that such work shall not exceed
the scope of the work required to originally construct the building.
Provided, further, the cost thereof to Lessee shall not exceed the
proceeds of its condemnation award, all to be done without any
adjustments in rent to be paid by Lessee. Lessor agrees to make the
condemnation proceeds available to Lessee for restoration or repair
pursuant to this section.
Notwithstanding any provision in this Lease to the contrary, if
any award for any portion of the Premises appropriated or taken under
power of eminent domain, or otherwise, which taking is deemed to be
temporary, Lessee shall, except as stated in the subsequent sentence,
have exclusive and full rights to any such award based upon such
temporary taking, and Lessor agrees to waive any right for such
temporary taking. If pursuant to this Lease Lessee terminates the
Lease, then in such event any award for temporary condemnation for a
period of time after the termination shall belong to Lessor. If in
the event the temporary taking is for a period of time that extends
after the end of the Term hereof, then Lessor shall be entitled to a
pro-rata amount of the temporary taking award based upon the amount of
time attributable to the period of time after the Term of the Lease.
(C) Subject to Article 12(B) above, all compensation awarded or
paid upon such total or partial taking of the Leased Premises shall
belong to and be the property of Lessor without any participation by
Lessee, whether such damages shall be awarded as compensation for
diminution in value to the leasehold or to the fee of the premises
herein leased. Nothing contained herein shall be construed to preclude
Lessee from prosecuting any claim directly against the condemning
authority in such proceedings for loss of business, damage to or cost
of removal of or for the value of stock, trade fixtures, furniture,
and other personal property belonging to Lessee; provided, however,
that no such claim shall diminish or otherwise adversely affect
Lessor's award or the award of any fee mortgagee. If a separate award
shall be made representing the difference between the value of the
leasehold estate and the fair market value of a comparable leasehold
estate, Lessee shall be entitled to the same; provided, however, that
Lessor shall be under no obligation to pursue such award on behalf of
Lessee
ARTICLE 13. RIGHT TO INSPECT
Lessor reserves the right to enter upon, inspect and examine the
Leased Premises at any time during business hours, and Lessee agrees
to allow Lessor free access to the Leased Premises to show the
premises upon a minimum of 48 hours prior notice to Lessee. Lessor
will not enter into the Leased Premises for purposes of this section
unless accompanied by a representative of Lessee and Lessee does
hereby agree to provide such representative upon request by Lessor,
such request given not less than 48 hours in advance. Upon default by
Lessee or at any time within ninety (90) days of the expiration or
termination of the Lease, Lessee agrees to allow Lessor to then place
"For Sale" or "For Rent" signs on the Leased Premises.
ARTICLE 14. USE OF LEASED PREMISES
(A) Lessee agrees and warrants that the Leased Premises will be
used only for lawfully permitted uses which do not diminish the value
of the Leased Premises.
ARTICLE 15. DESTRUCTION OF PREMISES
(A) If, during the term of this Lease, the Leased Premises are
totally or partially destroyed by fire or the elements, so as to
render the premises wholly unfit for occupancy, or make it impossible
in the opinion of a licensed third party arbitrator knowledgeable in
the child care business reasonably acceptable to Lessee and Lessor,
for Lessee to conduct its business therein, then either Lessor or
Lessee shall have the right to terminate this Lease from the date of
such damage or destruction by giving written notice. The parties agree
to use reasonable promptness to obtain the opinion of such licensed
third party arbitrator. Upon the giving of such notice, Lessee shall
immediately surrender the Leased Premises and all interest therein to
Lessor, and in case of any such termination, Lessor may re-enter and
repossess the Leased Premises and may dispossess all parties then in
possession thereof. If not otherwise terminated, in the event the
Leased Premises shall be repaired, restored, and rebuilt by Lessee
with the use of insurance proceeds (which Lessor shall cooperate to
make available), but otherwise at its own sole cost and expense,
within one hundred eighty (180) days from the date of destruction
(subject to force majuere as set forth in paragraph C hereof, then all
rents payable by Lessee shall be abated during the period of repair
and restoration to the extent Lessor shall be compensated by the
proceeds of rents loss insurance. In no event shall Lessor be required
to provide its own money for the repair or restoration of the Leased
Premises other than the net proceeds of moneys received by it from any
insurance policy or policies covering such loss or damages. Lessee
shall be liable for repair of the Leased Premises with all reasonable
speed, and the rents shall recommence on the date that the repairs are
completed. Lessee shall be under no obligation to so repair during the
last five (5) years of the term of the Lease, or as extended, but if
Lessee shall desire to rebuild during the last 12 months of the Lease
term, Lessor will make insurance proceeds available to rebuild the
Leased Premises conditioned upon Lessee then exercising its next
renewal option under the Lease. Lessor will make insurance proceeds
available to rebuild the Leased Premises in the event Lessee rebuilds,
except as stated above.
(B) If the damage does not, in the opinion of a licensed third
party arbitrator reasonably acceptable to Lessee and Lessor, render
the Leased Premises unfit for occupancy, then Lessor agrees that the
damage shall be repaired as soon as practicable and in that case,
Lessee shall pay full rent during the repair period. All repairs shall
be paid for by Lessee out of any insurance proceeds received (which
Lessor shall cooperate to make available), but if the insurance
proceeds are insufficient to rebuild or repair the Leased Premises
according to the original plans and specifications, whether repair or
restoration is commenced pursuant to paragraph A or B hereof, then
Lessee agrees to pay all additional amounts that are required to
rebuild the building in accordance with the original plans and
specifications. All improvements or betterments placed by Lessee on
the demised premises shall, however, in any event, be repaired and
replaced by Lessee at its own expense and not at the expense of
Lessor. The purpose of this Article is to require Lessee to carry
insurance coverage on the Leased Premises sufficient to rebuild the
improvements in the event of damage or destruction. Lessee shall be
under no obligation to so rebuild during the last five (5) years of
the term, as extended, as the case may be, but if Lessee shall desire
to rebuild during the last 12 months of the Lease term, Lessor will
make insurance proceeds available to rebuild the Leased Premises
conditioned upon Lessee then exercising its next renewal option under
the Lease. Lessor will make insurance proceeds available to rebuild
the Leased Premises in the event Lessee rebuilds, except as stated
above.
Risk that the insurance company shall be insolvent or shall
refuse to make insurance proceeds available shall be with Lessee. The
Leased Premises shall be so restored or rebuilt so as to be of at
least equal value and substantially the same character as prior to
such damage or destruction. If the insurance proceeds are less than
$100,000 they shall be paid to Lessee for such repair and restoration.
If the insurance proceeds are greater than or equal to $100,000 they
shall be deposited by Lessee and Lessor into a customary construction
escrow at a nationally recognized title insurance company, or at
Lessee's option, with Lessor ("Escrowee") and shall be made available
from time to time to Lessee for such repair and restoration. Such
proceeds shall be disbursed in conformity with the terms and
conditions of a commercially reasonable construction loan agreement.
Lessee shall, in either instance, deliver to Lessor or Escrowee (as
the case may be) satisfactory evidence of the estimated cost of
completion together with such architect's certificates, waivers of
lien, contractor's sworn statements and other evidence of cost and of
payments as the Lessor or Escrowee may reasonably require and approve.
If the estimated cost of the work exceeds One Hundred Thousand Dollars
($100,000), all plans and specifications for such rebuilding or
restoration shall be subject to the reasonable approval of Lessor.
(C) Lessee shall comply with the time period stated above for
restoration of the Leased Premises as set forth in this Article;
provided, however, that said period of time shall be extended for a
period or periods of time equal to any period or periods of delay
caused by strikes, lockouts, fire, or other casualty, the elements,
acts of God, delay by or refusal or failure of governmental
authorities to grant necessary permits and approvals for the
reconstruction of the Leased Premises (Lessee agreeing to use
reasonable diligence to procure the same), or other causes other than
financial, beyond Lessee's reasonable control or the reasonable
control of Lessee's contractor.
ARTICLE 16. ACTS OF DEFAULT
Each of the following shall be deemed a default by Lessee and a
breach of this Lease:
1. Failure to pay the Rent, or any monetary
obligation herein reserved, (and to be considered to be
rent for the purposes of this Lease) or any part thereof,
within five (5) business days after written notice from
Lessor that the same shall be due and payable. Provided,
however, that interest and penalties for failure to pay
rent when due shall accrue from the first date such rent
was due and payable.
2. Failure to do, observe, keep and perform any of
the material non-monetary terms, covenants, conditions,
agreements and provisions in this Lease to be done,
observed, kept and performed by Lessee within 30 days
after written notice of such default (or within a
reasonable time thereafter if the default is incapable of
cure within 30 days and Lessee is diligently pursuing a
reasonable course of action to cure such default.
3. The abandonment (defined herein as the leaving
of the Leased Premises without paying rent, without
maintaining and without the intent of returning) of the
Premises by Lessee, the adjudication of Lessee as a
bankrupt, the making by Lessee of a general assignment for
the benefit of creditors, the taking by Lessee of the
benefit of any insolvency act or law, the appointment of a
permanent receiver or trustee in bankruptcy for Lessee
property, or the appointment of a temporary receiver which
is not vacated or set aside within sixty (60) days from
the date of such appointment.
ARTICLE 17. TERMINATION FOR DEFAULT
In the event of any uncured default by Lessee and at any time
thereafter, Lessor may serve a written notice upon Lessee that Lessor
elects to terminate this Lease upon a specified date not less than
thirty (30) days after the date of serving such notice of termination,
and this Lease shall then terminate on the date so specified,
provided, however, that Lessee shall have continuing liability for
future rents for the remainder of the original term and any exercised
renewal term as set forth in Article 19, notwithstanding any earlier
termination of the Lease hereunder, preserving unto Lessor the benefit
of its bargained-for rental payments.
ARTICLE 18. LESSOR'S RIGHT OF RE-ENTRY
In the event that this Lease shall be terminated as herein
provided, or by summary proceedings or otherwise, or in the event of
an uncured default hereunder by Lessee, or in the event that the
premises or any part thereof, shall be abandoned by Lessee, (subject
to rights to cure as provided in Article 16) Lessor or its agents,
servants or representatives, may immediately or at any time
thereafter, re-enter and resume possession of the premises or any part
thereof, and remove all persons and property therefrom, in accordance
with local law either by summary dispossess proceedings or by a
suitable action or proceeding at law, without being liable for any
damages therefor.
ARTICLE 19. LESSEE'S CONTINUING LIABILITY
(A) Should Lessor elect to re-enter as provided in this Lease
or should it take possession pursuant to legal proceedings or pursuant
to any notice provided for by law, it may either (i) terminate this
Lease or (ii) it may from time to time, without terminating the
contractual obligation of Lessee to pay Rent under this Lease, make
such commercially reasonable alterations and repairs as may be
necessary to relet the Leased Premises or any part thereof for such
Term or Renewal Terms, at such commercially reasonable rental or
rentals, and upon such other commercially reasonable terms and
conditions as Lessor in its sole discretion may deem advisable.
(B) Upon each such reletting, without termination the
contractual obligation of Lessee to pay Rent under this
Lease, all rentals received by Lessor shall be applied as
follows:
1. First, to the payment of any indebtedness other
than rent due hereunder from Lessee to Lessor;
2. Second, to the payment of any commercially
reasonable costs and expenses of such reletting, including
brokerage fees and reasonable attorney's fees and of costs
of such alterations and repairs;
3. Third, to the payment of rent due and unpaid
hereunder;
4. The residue, if any, shall be held by Lessor and
applied in payment of future rent as the same may become
due and payable hereunder. Then any residue will be used
first to reimburse Lessor (or Lessee if previously paid by
Lessee for costs and expenses per Article 19(B)2 above)
for such costs and expenses incurred per Article 19(B)2
above until repaid, then any excess shall remain with
Lessor.
If such rentals received from such reletting during any month are
less than that to be paid during that month by Lessee hereunder,
Lessee shall pay any such deficiency to Lessor. Such deficiency shall
be calculated and paid monthly. No such re-entry or taking possession
of such Leased Premises by Lessor shall be construed as an election on
its part to terminate this Lease unless a written notice of such
intention be given to Lessee.
(C) Notwithstanding any such reletting without termination,
Lessor may at any time thereafter elect to terminate this Lease for
any breach.
(D) In addition to any other remedies Lessor may have with this
Article 19, Lessor may recover from Lessee all damages it may incur by
reason of any breach, including the cost of recovering and reletting
the Leased Premises, reasonable attorney's fees, and including the
present value (discounted at a rate of 8% per annum) of the excess of
the amount of rent and charges equivalent to rent reserved in this
Lease for the remainder of the Term over the then reasonable rental
value of the Leased Premises (or the actual rents receivable by
Lessor, if relet) for the remainder of the Term, all of which amounts
shall be immediately due and payable from Lessee to Lessor in full. In
determining the rent which would be payable by Lessee hereunder,
subsequent to default, the total Rental for each year of the unexpired
Term shall be equal to the average total Rental that would be payable
by Lessee as set forth in Article 4 above. In the event that the rent
obtained from such alternative or substitute tenant is more than the
rent which Lessee is obligated to pay under this Lease, then such
excess shall be paid to Lessor provided that Lessor shall credit such
excess against the outstanding obligations of Lessee due pursuant
hereto, if any.
(E) Lessor will use its reasonable efforts to mitigate its
damages, but Lessor shall have absolutely no obligation to expend any
moneys in the way of tenant inducements or in the refurbishment of the
Leased Premises for any use other than that for which the Leased
Premises were being used by Lessee. It is the object and purpose of
this Article 19 that Lessor shall be kept whole and shall suffer no
damage by way of non-payment of rent or by way of diminution in rent,
except as provided in subsection (D) above. Lessee waives and will
waive all rights to trial by jury in any summary proceedings to
recover possession of the Leased Premises which may hereafter be
instituted by Lessor.
ARTICLE 20. PERSONALTY, FIXTURES AND EQUIPMENT
(A) All building fixtures, building machinery, and building
equipment used in connection with the operation of the Leased Premises
including, but not limited to, heating, lighting, ventilating,
plumbing, walk-in refrigerators, walk-in freezers, and air
conditioning systems shall be the property of Lessor. All trade
fixtures and all other fixtures and articles of personal property
owned by Lessee shall remain the property of Lessee.
(B) Lessee shall furnish and pay for any and all equipment,
furniture, trade fixtures, and signs, except for such items, if any,
described in Article 20(A) above. Lessor agrees that it has no
interest in the personal property of Lessee.
(C) At the end of the term of this Lease, all personal property
and trade fixtures of Lessee may be removed from the Leased Premises
by Lessee, however, removal of such fixtures may proceed only after
five (5) business days prior written notice to Lessor of the time of
such removal and notice of the identification of the parties
performing such removal. All damage to the Leased Premises which may
be caused by the removal of such property shall be promptly paid for
by Lessee.
ARTICLE 21. LIENS
Lessee shall not do or cause anything to be done whereby the
Leased Premises may be encumbered by any mechanic's or other liens.
Whenever and as often as any mechanic's or other lien is filed
against said Leased Premises purporting to be for labor or materials
furnished or to be furnished to Lessee, within thirty (30) days from
the date of the filing of said mechanic's or other lien (or such
earlier period if required by law prevent default or attachment of the
lien) and delivery of notice thereof to Lessee of Lessee's obligation
under this Lease, Lessee shall remove the lien of record by payment or
by bonding with a surety company authorized to do business in the
state in which the property is located, or other security reasonably
acceptable to Lessor. Should Lessee fail to take the foregoing steps
within said thirty (30) day period, then Lessor shall have the right,
among other things, to pay said lien without inquiring into the
validity thereof, and Lessee shall forthwith reimburse Lessor for the
total expense incurred by it in discharging said lien as additional
rent hereunder, subject to notice to Lessee and a 10 business day cure
period.
ARTICLE 22. NO WAIVER BY LESSOR EXCEPT IN WRITING
No agreement to accept a surrender of the Leased Premises or
termination of this Lease shall be valid unless in writing signed by
Lessor. The delivery of keys to any employee of Lessor or Lessor's
agents shall not operate as a termination of the Lease or a surrender
of the premises. The failure of Lessor to seek redress for violation
of, any rule or regulation, shall not prevent a subsequent act, which
would have originally constituted a violation, from having all the
force and effect of an original violation. No payment by Lessee or
receipt by Lessor of a lesser amount than the rent herein stipulated
shall be deemed to be other than on account of the earliest stipulated
rent, nor shall any endorsement or statement on any check nor any
letter accompanying any check or payment as rent be deemed an accord
and satisfaction, and Lessor may accept such check or payment without
prejudice to Lessor's right to recover the balance of such rent or
pursue any other remedy provided in this Lease. This Lease contains
the entire agreement between the parties, and any executory agreement
hereafter made shall be ineffective to change, modify or discharge it
in whole or in part unless such executory agreement is in writing and
signed by the party against whom enforcement of the change,
modification or discharge is sought.
ARTICLE 23. QUIET ENJOYMENT
Lessor covenants that Lessee, upon paying the rent set forth in
Article 4 and all other sums herein reserved as rent and upon the due
performance of all the terms, covenants, conditions and agreements
herein contained on Lessee's part to be kept and performed, shall
have, hold and enjoy the Leased Premises free from molestation,
eviction, or disturbance by Lessor, or by any other person or persons
lawfully claiming the same, and that Lessor has good right to make
this Lease for the full term granted, including renewal periods.
ARTICLE 24. BREACH - PAYMENT OF COSTS AND ATTORNEYS' FEES
The non-prevailing party agrees to pay and discharge all
reasonable costs, attorneys' fees and expenses that shall be incurred
by the prevailing party in enforcing the covenants, conditions and
terms of this Lease or defending against an alleged breach.
ARTICLE 25. ESTOPPEL CERTIFICATES
Either party to this Lease will, at any time from time to time,
upon not less than ten (10) business days prior request by the other
party, execute, acknowledge and deliver to the requesting party a
statement in writing, executed by an executive officer of such party,
certifying (a) that this Lease is unmodified (or if modified then
disclosure of such modification shall be made); (b) that this Lease is
in full force and effect; (c) that the date to which the rent and
other charges have been paid; and (d) that to the knowledge of the
signer of such certificate the other party is not in default in the
performance of any covenant, agreement or condition contained in this
Lease, or if a default does exist, specifying each such default of
which the signer may have knowledge. It is intended that any such
statement delivered pursuant to this Article may be relied upon by any
prospective purchaser or mortgagee of the Leased Premises or any
assignee of such mortgagee or a purchaser of the leasehold estate.
ARTICLE 26. FINANCIAL STATEMENTS
Lessee will, within ninety (90) days after the end of Lessee's
fiscal year during the term of this Lease, furnish to the Lessor
financial statements of the Lessee ("Financial Statements") and a
statement setting forth the amount of annual Net Revenues (hereinafter
defined) of the Lessee's business conducted on the Premises ("Net
Revenue Statement"). The Financial Statements shall be certified, as
true and correct in all material respects, by an officer of Lessee or
if Financial Statements are prepared by an independent certified
public accountant then such accountant's report shall be provided and
such report shall be prepared in conformity with generally accepted
accounting principals with accountant's opinion and footnotes included
therein. The Financial Statements shall include a balance sheet,
related statement of income and statement of cash flows. For purposes
of this Article, "Net Revenues" shall include all amounts received by
Lessee in cash and in credit (regardless of whether payment is
actually collected) from all sales of merchandise and services, and
income from all other sources of business conducted on or in the
Premises, EXCLUDING the following:
a. All ancillary income generated from miscellaneous sales of goods
or services by Lessee at the Premises;
b. Refunds, promotional discounts, credits made to customers for
absences, actual bad debt expenses, and provisions for doubtful
accounts, the amount of which has been previously included in gross
sales;
c. Employee and other standard industry discounts, such as family,
corporate and welfare discounts; and
d. Any amounts received by Lessee as grantee of any award or grant
funded under any program sponsored by any local, state, federal or
private agency or organization.
AEI acknowledges and agrees that the Net Revenue Statements
provided by Lessee hereunder are unaudited. Further, AEI shall
indemnify and hold Lessee and its parent company, and their respective
officers, directors, and shareholders ("Indemnified Parties"),
harmless from and against any claims, damages, causes of action, or
expense of whatever nature, including attorneys fees, incurred by the
Indemnified Parties arising out of any disclosure of the Net Revenue
Statements of Lessee to any investor in any AEI fund or property or
any of their respective advisors or professional consultants, or
others to whom AEI may provide such Revenue Statements.
ARTICLE 27. MORTGAGE
Lessee does hereby agree to make reasonable modifications of this
Lease requested by any Mortgagee of record from time to time provided
such modifications are not material and do not increase any of the
rents or modify any of the business elements of this Lease.
ARTICLE 28. OPTION TO RENEW
If this Lease is not previously canceled or terminated and if
Lessee is not then in material default hereunder, then Lessee shall
have three (3) separate individual options to renew this Lease upon
the same conditions and covenants contained in this Lease for three
separate individual (3) consecutive periods of five (5) years each
(singularly "Renewal Term").
The first Renewal Term would commence on the date the original
Term expires and successive Renewal Terms would commence on the last
day of the then expiring Renewal Term. Lessee must give 90 days
written notice to Lessor of its intent to exercise this option prior
to the expiration of the original Term of this Lease or any Renewal
Term, as the case may be.
The rent during the Renewal Term or Terms shall increase each
Fifth Lease Year of the Renewal Term at the same rate as set forth in
Article 4 above.
ARTICLE 29. MISCELLANEOUS PROVISIONS
(A) All written notices shall be given by certified mail or a
nationally recognized overnight or express courier. Notices to Lessor
shall be addressed to the person and address given on the first page
hereof. Lessor and Lessee may, from time to time, change these
addresses by notifying each other of this change in writing.
(B) The terms, conditions and covenants contained in this Lease
and any riders and plans attached hereto shall bind and inure to the
benefit of Lessor and Lessee and their respective successors, heirs,
legal representatives, and assigns.
(C) This Lease shall be governed by and construed under the
laws of the State where the premises are situated.
(D) In the event that any provision of this Lease shall be held
invalid or unenforceable, no other provisions of this Lease shall be
affected by such holding, and all of the remaining provisions of this
Lease shall continue in full force and effect pursuant to the terms
hereof.
(E) The paragraph captions are inserted only for convenience
and reference, and are not intended, in any way, to define, limit,
describe the scope, intent, and language of this Lease or its
provisions.
(F) In the event Lessee remains in possession of the premises
herein leased after the expiration of this Lease and without the
execution of a new lease, it shall be deemed to be occupying said
premises as a tenant from month-to-month, subject to all the
conditions, provisions, and obligations of this Lease insofar as the
same can be applicable to a month-to-month tenancy except that the
monthly installment of Rental shall be increased 25% from the amount
due on the last month prior to such expiration.
(G) If any installment of rent (whether lump sum, monthly
installments, or any other monetary amounts required by this Lease to
be paid by Lessee and deemed to constitute Rental hereunder) shall not
be paid within 10 days when due, Lessor shall have the right to charge
Lessee a late charge of $250 per month for unpaid rent for each month
that any amount of rent installment remains unpaid. Said late charge
shall commence after such installment is due and continue until said
installment, interest and all accrued late charges are paid in full.
(H) Any part of the Leased Premises may be conveyed by Lessor
for private easement purposes at any time provided Lessee gives
written consent to such private easement. In the event that the
private easement affects or is related to the playground or the
building on the Leased Premises, then Lessee's consent may be
arbitrarily withheld in Lessee's sole and absolute discretion. If the
private easement does not affect the playground or building on the
Leased Premises, then Lessee's consent may not be commercially
unreasonably withheld. In such event that any part of the Leased
Premises are so conveyed, Lessor shall, at its own cost and expense,
restore the remaining portion of the Leased Premises to the extent
necessary to render it reasonably suitable for the purposes for which
it was leased, all to be done without adjustments in rent to be paid
by Lessee. All proceeds from any conveyance of a private easement
shall belong solely to Lessor.
(I) For the purpose of this Lease, the term "rent" shall be
defined as Rental under Article 4, and any other monetary amounts
required by this Lease to be paid by Lessee.
ARTICLE 30. REMEDIES
NON-EXCLUSIVITY. Notwithstanding anything contained herein it is
the intent of the parties that the rights and remedies contained
herein shall not be exclusive but rather shall be cumulative along
with all of the rights and remedies of the parties which they may
have at law or equity.
ARTICLE 31. HAZARDOUS MATERIALS INDEMNITY
Lessee covenants, represents and warrants to Lessor, its
successors and assigns, (i) that except in the ordinary course of
business of conducting a day care facility and then only in accordance
with applicable law, rule, or regulation, Lessee has not used or
permitted the Leased Premises to be used for the generating,
transporting, treating, storage, manufacture, emission of, or disposal
of any dangerous, toxic or hazardous pollutants, chemicals, wastes or
substances as defined in the Federal Comprehensive Environmental
Response Compensation and Liability Act of 1980 ("CERCLA"), the
Federal Resource Conservation and Recovery Act of 1976 ("RCRA"), or
any other federal, state or local environmental laws, statutes,
regulations, requirements and ordinances ("Hazardous Materials");
further, Lessee will not use or permit the Leased Premises to be used
during the Term of this Lease, whether directly or through
contractors, agents or tenants, for the generating, transporting,
treating, storage, manufacture, emission of, or disposal of any
Hazardous Materials, except in the ordinary course of conducting a day
care facility, and then only in accordance with applicable law, rule
or regulation; (ii) that there have been no investigations or reports
involving Lessee, or the Leased Premises by any governmental authority
which in any way pertain to Hazardous Materials; (iii) that the
operation of the Leased Premises has not violated and is not currently
violating any federal, state or local law, regulation, ordinance or
requirement governing Hazardous Materials; (iv) that the Leased
Premises is not listed in the United States Environmental Protection
Agency's National Priorities List of Hazardous Waste Sites nor any
other list, schedule, log, inventory, or record of Hazardous Materials
or hazardous waste sites, whether maintained by the United States
Government or any state or local agency; and (v) that the Leased
Premises will not contain any formaldehyde, urea or asbestos, except
as may have been disclosed in writing to Lessor by Lessee at the time
of execution and delivery of this Lease. Lessee agrees to indemnity
and reimburse Lessor, its successors and assigns, for:
(a) any breach of these representations and warranties, and
(b) any loss, damage, expense or cost arising out of or
incurred by Lessor which is the result of a breach of,
misstatement of or misrepresentation of the above
covenants, representations and warranties, and
(c) any and all liability of any kind whatsoever which Lessor
may, for any cause and at any time, sustain or incur by
reason of Hazardous Materials, released or placed on the
Leased Premises during the term of the Lease,
together with all reasonable attorneys' fees, costs and disbursements
incurred in connection with the defense of any action against Lessor
arising out of the above. These covenants, representations and
warranties shall be deemed continuing covenants, representations and
warranties for the benefit of Lessor, and any successors and assigns
of Lessor and shall survive expiration or sooner termination of this
Lease. The amount of all such indemnified loss, damage, expense or
cost, shall bear interest thereon at the rate of interest equal to the
rate changed on overdue payment in Section 4(G) and shall become
immediately due and payable in full on demand of Lessor, its
successors and assigns.
ARTICLE 32. ESCROWS
If Lessee has defaulted in payment of any taxes, or if Lessee
shall be in default under any of the items of this Lease, or if
Lessor's Mortgagee shall require Lessor to escrow the amount of real
estate taxes or assessments on a monthly basis, then in either event,
at Lessor's option, Lessee shall deposit with an escrow agent
reasonably acceptable to Lessor and Lessee on the first day of each
and every month thereafter, an amount equal to one-twelfth (1/12th) of
the estimated annual real estate taxes, assessments ("Charges") due on
the Leased Premises. From time to time out of such deposits Lessor
will, upon the presentation to Lessor by Lessee of the bills therefor,
pay the Charges or will upon presentation of receipted bills therefor,
reimburse Lessee for such payments made by Lessee. In the event the
deposits on hand shall not be sufficient to pay all of the estimated
Charges when the same shall become due from time to time or the prior
payments shall be less than the currently estimated monthly amounts,
then Lessee shall pay to Lessor on demand any amount necessary to make
up the deficiency. The excess of any such deposits shall be credited
to subsequent payments to be made for such items. If a default or an
event of default shall occur under the terms of this Lease, Lessor
may, at its option, without being required so to do, apply any Deposit
on hand to cure the default, in such order and manner as Lessor may
elect.
ARTICLE 33. NET LEASE
Notwithstanding anything contained herein to the contrary it is
the intent of the parties hereto that this Lease shall be a net lease
and that the rent defined pursuant to Paragraph 4 should be a net
rent paid to Lessor. Any and all other expenses including but not
limited to, maintenance, repair, insurance, taxes, and assessments,
shall be paid by Lessee.
ARTICLE 34. RIGHT TO SUBSTITUTION
If Lessee determines that it is economically unfeasible to
continue operations in or at the Leased Premises, Lessee may exchange
the Leased Premises for another of like kind, value, size and
demographic location acceptable to Lessor. If Lessor elects to accept
a replacement property in exchange for the Leased Premises owned by
Lessor, Lessee shall provide a replacement property of comparable
size, cost, location and ownership interest in a Section 1031 "like-
kind" exchange and shall lease the replacement Premises from Lessor on
identical terms as contained in the lease for the original Leased
Premises. All costs associated with making such exchange, including
the provision of surveys, title, environmental and all other
documentation normally required or obtained by Lessor, shall be paid
by Lessee.
IN WITNESS WHEREOF, Lessor and Lessee have respectively signed
and sealed this Lease as of the day and year first above written.
LESSEE: ARAMARK EDUCATIONAL RESOURCES, INC.,
dba CHILDREN'S WORLD LEARNING
CENTERS, INC., a Delaware corporation
Attest: By: /s/ Xxxx Xxxxx
/s/ Xxxxxx X Xxxxxxxxx Its: Executive Vice President
Xxxxxx X Xxxxxxxxx Asst. Secretary
STATE OF )
)SS.
COUNTY OF )
The foregoing instrument was acknowledged before me this 21st day of
May, 2002, by Xxxx Xxxxx, the Executive Vice President of ARAMARK
EDUCATIONAL RESOURCES, INC., dba Children's World Learning Centers,
Inc., a Delaware corporation, on behalf of said corporation.
/s/ Xxxxx Xxxxxxxx
Notary Public [notary seal]
LESSOR: AEI INCOME & GROWTH FUND 24 LLC
By: AEI Fund Management XXI, Inc.,
its Managing Member
By: /s/ Xxxxxx X Xxxxxxx
Xxxxxx X. Xxxxxxx, President
STATE OF MINNESOTA )
)SS.
COUNTY OF XXXXXX )
The foregoing instrument was acknowledged before me the 21st day
of May, 2002, by Xxxxxx X. Xxxxxxx, President of AEI Fund Management
XXI, Inc., as Managing Member of AEI Income & Growth Fund 24 LLC, on
behalf of said limited liability company.
/s/ Xxxxxxx X Xxxxxxxxx
Notary Public [notary seal]
EXHIBIT A
TO
LEASE AGREEMENT
Legal Description
PARCEL 1: XXX 0 XX XXXXXXXX XXXXX XXXX XXXXXXXXXX SUBDIVISION OF XXX
00 XX XXXXXXXX XXXXX XXXX, BEING A SUBDIVISION, AS RECORDED PER
DOCUMENT NO. 89177441, OF PART OF THE NORTHWEST 1/4 OF SECTION 34,
TOWNSHIP 36 NORTH, RANGE 12 EAST OF THE THIRD PRINCIPAL MERIDIAN, IN
XXXX COUNTY, ILLINOIS, ACCORDING THE THE PLAT THEREOF RECORDED
NOVEMBER 8, 2000 AS DOCUMENT NO. 00878235, AS AMENDED BY AMENDMENT TO
PHEASANT CHASE WEST COMMERCIAL SUBDIVISION RECORDED MAY 21, 2001 AS
COUMENT 0010427812.
PARCEL 2: A NON-EXCLUISVE, PERPETUAL RIGHT-OF-WAY EASEMENT FOR
VEHICULAR ACCESS OVER AND ACROSS THE SOUTH 116 FEET OF THE WEST 15
FEET OF LOT 2 OF PHEASANT CHASE WEST COMMERCIAL SUBDIVISION OF XXX 00
XX XXXXXXXX XXXXX XXXX, BEING A SUBDIVISION, AS RECORDED PER DOCUMENT
NO. 89177441, OF PART OF THE NORTHWEST 1/4 OF SECTION 34, XXXX COUNTY,
ILLINOIS, ACCORDING THE THE PLAT THEREORF RECORDED NOVEMBER 8, 2000 AS
DOCUMENT NO. 00878235, AS AMENDED BY AMENDMENT TO PHEASANT CHASE WEST
COMMERICAL SUBDIVISION RECORDED MAY 21, 2001 AS DOCUMENT 0010427812.
