EXHIBIT 10.0
LEASE AGREEMENT
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THIS LEASE is executed this 30th day of November, 1998, by and between PARK
100 PROPERTIES, INC., a Delaware corporation ("Landlord"), and HAT WORLD, INC.,
a Minnesota corporation ("Tenant").
WITNESSETH:
ARTICLE 1 - LEASE OF PREMISES
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Section 1.01. Basic Lease Provisions and Definitions.
A. Leased Premises (shown outlined on Exhibit A attached hereto); 0000
Xxxxxxxx Xxxxx; Xxxxxxxxxxxx, Xxxxxxx 00000; Building No. 64 (the
"Building"); located in Park 100 Business Park (the "Park");
B. Rentable Area: approximately 17,600 square feet
Landlord shall use commercially reasonable standards, consistently applied,
in determining the Rentable Area and the rentable area of the Building.
Landlord's determination of Rentable Area shall conclusively be deemed
correct for all purposes hereunder.
C. Tenant's Proportionate Share: 21.15%;
D. Minimum Annual Rent:
February 1, 1999 - April 30, 1999 $15,840.00 (3 months)
May 1, 1999 - January 31, 2000 $65,340.00 (9 months)
February 1, 2000 - January 31, 2002 $87,120.00 per year
E. Monthly Rental Installments:
February 1, 1999 - April 30, 1999 $5,280.00 per month
May 1, 1999 - January 31, 2002 $7,260.00 per month
F. Landlord's Share of Expenses: $1.32 times the rentable area of the Building
which is included in the rent;
G. Lease Term: Three years;
H. Commencement Date: February 1, 1999, provided this Lease Agreement if fully
executed by Landlord and Tenant on or before November 30, 1998, that the
Leased Premises is available to Tenant on or before January 1, 1999 and
that Landlord completes Landlord's work as described in attached Exhibit B
prior to January 10, 1999;
I. Security Deposit: $7,260.00;
J. Guarantor(s): N/A;
K. Broker(s): Duke Realty Services Limited Partnership representing Landlord
and Hovance Properties, Inc. representing Tenant;
L. Permitted Use: Distribution of hats to a chain of retail outlets and
related purposes;
M. Address for notices:
Landlord: Park 100 Properties, Inc.
c/o Duke Realty Services Limited Partnership
0000 Xxxxxxxx Xxxxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, XX 00000
Tenant: Hat World, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Address for rental and other payments:
Park 100 Properties, Inc.
c/o Duke Realty Services Limited Partnership
X.X. Xxx 00000
Xxxxxxxxxxxx, XX 00000
Section 1.02. Leased Premises. Landlord hereby leases to Tenant and Tenant
leases from Landlord, under the terms and conditions herein, the Leased
Premises.
ARTICLE 2 - TERM AND POSSESSION
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Section 2.01. Term. The term of this Lease ("Lease Term") shall be for the
period of time and shall commence on the Commencement Date described in the
Basic Lease Provisions. Upon delivery of possession of the Leased Premises to
Tenant, Tenant shall execute a letter of understanding acknowledging (i) the
Commencement Date of this Lease, and (ii) that Tenant has accepted the Leased
Premises. If Tenant takes possession of and occupies the Leased Premises, Tenant
shall be deemed to have accepted the Leased Premises and that the condition of
the Leased Premises and the Building was at the time satisfactory and in
conformity with the provisions of this Lease in all respects.
Section 2.02. Construction of Tenant Improvements. Tenant has personally
inspected the Leased Premises and accepts the same "AS IS" without
representation or warranty by Landlord of any kind and with the understanding
that Landlord shall have no responsibility with respect thereto except to
construct in a good an workmanlike manner the improvements designated as
Landlord's obligations in the attached Exhibit B, which shall be in accordance
with and at the expense of the party indicated on Exhibit B.
Section 2.03. Surrender of the Premises. Upon the expiration or earlier
termination of this Lease, Tenant shall immediately surrender the Leased
Premises to Landlord in broom-clean condition and in good condition and repair.
Tenant shall also remove its personal property, trade fixtures and any of
Tenant's alterations designated by Landlord, promptly repair any damage caused
by such removal, and restore the Leased Premises to the condition existing upon
the Commencement Date, reasonable wear and tear excepted. If Tenant fails to do
so, Landlord may restore the Leased Premises to such condition at Tenant's
expense, Landlord any cause all of said property to be removed at Tenant's
expense, and Tenant hereby agrees to pay all the costs and expenses thereby
reasonably incurred. All Tenant property which is not removed within ten (10)
days following Landlord's written demand therefor shall be conclusively deemed
to have been abandoned by Tenant and Landlord shall be entitled to dispose of
such property at Tenant's cost without thereby incurring any liability to
Tenant. The provisions of this section shall survive the expiration or other
termination of this Lease unless otherwise agreed by Landlord and Tenant prior
to the expiration date.
Section 2.04. Holding Over. If Tenant retains possession of the Leased
Premises after the expiration or earlier termination of this Lease, Tenant shall
become a tenant from month to month at twice the Monthly Rental Installment in
effect at the end of the Lease Term, and otherwise upon the terms, covenants and
conditions herein specified, so far as applicable. Acceptance by Landlord of
rent in such event shall not result in a renewal of this Lease, and Tenant shall
vacate and surrender the Leased Premises to Landlord upon Tenant being given
thirty (30) days' prior written notice from Landlord to vacate whether or not
said notice is given on the rent paying date. This Section 2.04 shall in no way
constitute a consent by Landlord to any holding over by Tenant upon the
expiration or earlier termination of this Lease, nor limit Landlord's remedies
in such event.
ARTICLE 3 - RENT
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Section 3.01. Base Rent. Tenant shall pay to Landlord the Minimum Annual
Rent in the Monthly Rental Installments, in advance, without deduction or
offset, beginning on the Commencement Date and on or before the first day of
each and every calendar month thereafter during the Lease Term. The Monthly
Rental Installment for partial calendar months shall be prorated.
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Section 3.02. Additional Rent. In addition to the Minimum Annual Rent
Tenant shall pay to Landlord for each calendar year during the Lease Term, as
"Additional Rent," Tenant's Proportionate Share of all costs and expenses
incurred by Landlord during the Lease Term for Real Estate Taxes and Operating
Expenses for the Building and common areas (collectively "Common Area Charges")
to the extent such Common Area Charges exceed Landlord's Share of Expenses.
"Operating Expenses" shall mean all of Landlord's expenses for operation,
repair, replacement and maintenance to keep the Building and common areas in
good order, condition and repair (including all additional direct costs and
expenses of operation and maintenance of the Building which Landlord reasonably
determines it would have paid or incurred during such year if the Building had
been fully occupied), including, but not limited to, management or
administrative fees; utilities; stormwater discharge fees; license, permit,
inspection and other fees; fees and assessments imposed by any covenants or
owners' association; security services; insurance premiums and deductibles; and
maintenance, repair and replacement of the driveways, parking areas (including
snow removal), exterior lighting, landscaped areas, walkways, curbs, drainage
strips, sewer lines, exterior walls, foundation, structural frame, roof and
gutters. The cost of any capital improvement shall be amortized over the useful
life of such improvement (as reasonably determined by Landlord), and only the
amortized portion shall be included in Operating Expenses.
"Real Estate Taxes" shall include any form of real estate tax or assessment
or service payments in lieu thereof, and any license fee, commercial rental tax,
improvement bond or other similar charge or tax (other than inheritance,
personal income or estate taxes) imposed upon the Building or common areas (or
against Landlord's business of leasing the Building) by any authority having the
power to so charge or tax, together with costs and expenses of contesting the
validity or amount of Real Estate Taxes which at Landlord's option may be
calculated as if such contesting work had been performed on a contingent fee
basis (whether charged by Landlord's counsel or representative; provided,
however, that said fees are reasonably comparable to the fees charged for
similar services by others not affiliated with Landlord, but in no event shall
fees exceed thirty-three percent (33%) of the good faith estimated tax savings).
Additionally, Tenant shall pay, prior to delinquency, all taxes assessed against
and levied upon trade fixtures, furnishings, equipment and all personal property
of Tenant contained in the Leased Premises.
Section 3.03. Payment of Additional Rent. Landlord shall estimate the total
amount of Additional Rent to be paid by Tenant during each calendar year of the
Lease Term, pro-rated for any partial years. Commencing on the Commencement
Date, Tenant shall pay to Landlord each month, at the same time the Monthly
Rental Installment is due, an amount equal to one-twelfth (1/12) of the
estimated Additional Rent for such year. Within a reasonable time after the end
of each calendar year, Landlord shall submit to Tenant a statement of the actual
amount of such Additional Rent and within thirty (30) days after receipt of such
statement, Tenant shall pay any deficiency between the actual amount owed and
the estimates paid during such calendar year. In the event of overpayment,
Landlord shall credit the amount of such overpayment toward the next
installments of Minimum Rent; provided, however, Tenant shall not be entitled to
a credit if actual Common Area Charges are less than Landlord's Share of
Expenses.
Section 3.04. Late Charges. Tenant acknowledges that Landlord shall incur
certain additional unanticipated administrative and legal costs and expenses if
Tenant fails to timely pay any payment required hereunder. Therefore, in
addition to the other remedies available to Landlord hereunder, if any payment
required to be paid by Tenant to Landlord hereunder shall become overdue, such
unpaid amount shall bear interest from the due date thereof to the date of
payment at the prime rate (as reported in the Wall Street Journal) of interest
("Prime Rate") plus six percent (6%) per annum.
ARTICLE 4 - SECURITY DEPOSIT
Tenant, upon execution of this Lease, shall deposit with Landlord the
Security Deposit as security for the performance by Tenant of all of Tenant's
obligations contained in this Lease. In the
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event of a default by Tenant Landlord may apply all or any part of the Security
Deposit to cure all or any part of such default; and Tenant agrees to promptly,
upon demand, deposit such additional sum with Landlord as may be required to
maintain the full amount of the Security Deposit. All sums held by Landlord
pursuant to this section shall be without interest. At the end of the Lease
Term, provided that there is then no uncured default, Landlord shall return the
Security Deposit to Tenant.
ARTICLE 5 - USE
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Section 5.01. Use of Leased Premises. The Leased Premises are to be used by
Tenant solely for the Permitted Use and for no other purposes without the prior
written consent of Landlord.
Section 5.02. Covenants of Tenant Regarding Use. Tenant shall (i) use and
maintain the Leased Premises and conduct its business thereon in a safe,
careful, reputable and lawful manner, (ii) comply with all laws, rules,
regulations, orders, ordinances, directions and requirements of any governmental
authority or agency, now in force or which may hereafter be in force, including
without limitation those which shall impose upon Landlord or Tenant any duty
with respect to or triggered by a change in the use or occupation of, or any
improvement or alteration to, the Leased Premises, and (iii) comply with and
obey all reasonable directions of the Landlord, including any reasonable rules
and regulations that may be adopted by Landlord from time to time. Tenant shall
not (do or permit anything to be done in or about the Leased Premises or common
areas which constitutes a nuisance or which interferes with the rights of other
tenants or injures or annoys them. Landlord shall not be responsible to Tenant
for the nonperformance by any other tenant or occupant of the Building of its
lease or of any rules and regulations. Tenant shall not overload the floors of
the Leased Premises. All damage to the floor structure or foundation of the
Building due to improper positioning or storage of items or materials shall be
repaired by Landlord at the sole expense of Tenant, who shall reimburse Landlord
immediately therefor upon demand. Tenant shall not use the Leased Premises, or
allow the Leased Premises to be used, for any purpose or in any manner which
would invalidate any policy of insurance now or hereafter carried on the
Building or increase the rate of premiums payable on any such insurance policy
unless Tenant reimburses Landlord as Additional Rent for any increase in
premiums charged.
Section 5.03. Landlord's Rights Regarding Use. In addition to the rights
specified elsewhere in this Lease, Landlord shall have the following rights
regarding the use of the Leased Premises or the common areas, each of which may
be exercised without notice or liability to Tenant, (a) Landlord may install
such signs, advertisements, notices or tenant identification information as it
shall deem necessary or proper; (b) Landlord shall have the right at any time to
control, change or otherwise alter the common areas as it shall deem necessary
or proper; and (c) Landlord or Landlord's agent shall be permitted to inspect or
examine the Leased Premises at any reasonable time upon reasonable notice
(except in an emergency when no notice shall be required), and Landlord shall
have the right to make any repairs to the Leased Premises which are necessary
for its preservation; provided, however, that any repairs made by Landlord shall
be at Tenant's expense, except as provided in Section 7.02 hereof. Landlord
shall incur no liability to Tenant for such entry, nor shall such entry
constitute an eviction of Tenant or a termination of this Lease. or entitle
Tenant to any abatement of rent therefor.
ARTICLE 6 - UTILITIES AND SERVICES
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Tenant shall obtain in its own name and pay directly to the appropriate
supplier the cost of all utilities and services serving the Leased Premises.
However, if any services or utilities are jointly metered with other property,
Landlord shall make a reasonable determination of Tenant's proportionate share
of the cost of such utilities and services (at rates that would have been
payable if such utilities and services had been directly billed by the utilities
or services providers to Tenant) and Tenant shall pay such share to Landlord
within fifteen (15) days after receipt of Landlord's written statement except
for negligence of Landlord, its agents, invitees or contractors. Landlord shall
not be liable in damages or otherwise for any failure or interruption of any
utility or other building service and no such failure or interruption shall
entitle Tenant to terminate this Lease or withhold sums due hereunder. In the
event of utility "deregulation", Landlord may choose the service provider.
ARTICLE 7 - MAINTENANCE AND REPAIRS
-----------------------------------
Section 7.01. Tenant's Responsibility. During Lease Term, Tenant shall, at
its own cost and expense, maintain the Leased Premises in good condition,
regularly servicing and promptly making all repairs and replacements thereto,
including but not limited to the electrical systems, heating and air
conditioning systems, plate glass, floors, windows and doors, sprinkler and
plumbing systems, and shall obtain a preventive maintenance contract on the
heating, ventilating and air-conditioning systems, and provide Landlord with a
copy thereof. The preventive maintenance contract shall meet or exceed
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Landlord's standard maintenance criteria, and shall provide for the inspection
and maintenance of the heating, ventilating and air conditioning system on not
less than a semi-annual basis.
Section 7.02. Landlord's Responsibility. During the term of this Lease,
Landlord shall maintain in good condition and repair, and replace as necessary,
the roof, exterior walls, foundation and structural frame of the Building and
the parking and landscaped areas, the costs of which shall be included in
Operating Expenses; provided, however, that to the extent any of the foregoing
items require repair because of the negligence, misuse, or default of Tenant,
its employees, agents, customers or invitees, Landlord shall make such repairs
solely at Tenant's expense.
Section 7.03. Alterations. Tenant shall not permit alterations in or to the
Leased Premises unless and until the plans have been approved by Landlord in
writing. As a condition of such approval, Landlord may require Tenant to remove
the alterations and restore the Leased Premises upon termination of this Lease;
otherwise, all such alterations shall at Landlord's option become a part of the
realty and the property of Landlord, and shall not be removed by Tenant. Tenant
shall ensure that all alterations shall be made in accordance with all
applicable laws, regulations and building codes, in a good and workmanlike
manner and of quality equal to or better than the original construction of the
Building. No person shall be entitled to any lien derived through or under
Tenant for any labor or material furnished to the Leased Premises, and nothing
in this Lease shall be construed to constitute a consent by Landlord to the
creation of any lien. If any lien is filed against the Leased Premises for work
claimed to have been done for or material claimed to have been furnished to
Tenant, Tenant shall cause such lien to be discharged of record within thirty
(30) days after filing. Tenant shall indemnify Landlord from all costs, losses,
expenses and attorneys' fees in connection with any construction or alteration
and any related lien.
ARTICLE 8 - CASUALTY
--------------------
Section 8.01. Casualty. In the event of total or partial destruction of the
Building or the Leased Premises by fire or other casualty, Landlord agrees to
promptly restore and repair same; provided, however, Landlord's obligation
hereunder shall be limited to the reconstruction of such of the Tenant finish
improvements as were originally required to be made by Landlord, if any. Rent
shall proportionately xxxxx during the time that the Leased premises or part
thereof are unusable because of any such damage. Notwithstanding the foregoing,
if the Leased Premises are (i) so destroyed that they cannot be repaired or
rebuilt within one hundred eighty (180) days from the casualty date; or (ii)
destroyed by a casualty which is not covered by the insurance required hereunder
or, if covered, such insurance proceeds are not released by any mortgages
entitled thereto or are insufficient to rebuild the Building and the Leased
Premises; then, in case of a clause (i) casualty, either Landlord or Tenant may,
or, in the case of a clause (ii) casualty, then Landlord may, upon thirty (30)
days' written notice to the other party, terminate this Lease with respect to
matters thereafter accruing.
Section 8.02. All Risk Coverage Insurance. During the Lease Term, Landlord
shall maintain all risk coverage insurance on the Building, but shall not
protect Tenant's property on the Leased Premises, and, notwithstanding the
provisions of Section 9.01, Landlord shall not be liable for any damage to
Tenant's property, (regardless of cause), except to the extent caused directly
by the negligence of Landlord and its employees, agents and invitees. Tenant
hereby expressly waives any right of recovery against Landlord for damage to any
property of Tenant located in or about the Leased Premises, however caused,
except to the extent caused directly by the negligence of Landlord and its
employees, agents and invitees. Notwithstanding the provisions of Section 9.01
below, Landlord hereby expressly waives any rights of recovery against Tenant
for damage to the Leased Premises or the Building which is insured against under
Landlord's all risk coverage insurance. All insurance policies maintained by
Landlord or Tenant as provided in this Lease shall contain an agreement by the
insurer waiving the insurer's right of subrogation against the other party to
this Lease.
ARTICLE 9 - LIABILITY INSURANCE
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Section 9.01. Tenant's Responsibility. Landlord shall not be liable to
Tenant or to any other person for (i) damage to property or injury or death to
persons due to the condition of the Leased Premises, the Building or the common
areas, or (ii) the occurrence of any accident in or about the Leased Premises or
the common areas, or (iii) any act or neglect of Tenant or any other tenant or
occupant of the Building or of any other person, unless such damage, injury or
death is directly and solely the result of Landlord's negligence and that of its
employees, agents and invitees; and Tenant hereby releases Landlord from any and
all liability for the same. Tenant shall be liable for, and shall indemnify and
defend Landlord from, any and all liability for (i) any act or neglect of Tenant
and any person coming on the Leased Premises or common areas by the license of
Tenant, express or implied, (ii) any damage to the Leased Premises, and (iii)
any loss of or damage or injury to any person (including death resulting
therefrom) or property occurring in, on or about the Leased Premises,
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regardless of cause, except for any loss or damage covered by Landlord's all
risk coverage insurance as provided in Section 8.02 and except for that caused
solely and directly by Landlord's negligence. This provision shall survive the
expiration or earlier termination of this Lease.
Section 9.02. Tenant's Insurance. Tenant shall carry general public
liability and property damage insurance, issued by one or more insurance
companies acceptable to Landlord, with the following minimum coverages:
A. Worker's Compensation: minimum statutory amount.
B. Commercial General Liability Insurance, including blanket, contractual
liability, broad form property damage, personal injury, completed
operations, products liability, and fire damage: Not less than $3,000,000
Combined Single Limit for both bodily injury and property damage.
C. All Risk Coverage, Vandalism and Malicious Mischief, and Sprinkler Leakage
insurance, if applicable, for the full cost of replacement of Tenant's
property.
D. Business interruption insurance.
The insurance policies shall protect Tenant and Landlord as their interests may
appear, naming Landlord and Landlord's managing agent and mortgagee as
additional insureds, and shall provide that they may not be canceled on less
than thirty (30) days' prior written notice to Landlord. Tenant shall furnish
Landlord with Certificates of Insurance evidencing all required coverages on
or before the Commencement Date. If Tenant fails to carry such insurance and
furnish Landlord with such Certificates of Insurance after a request to do so,
Landlord may obtain such insurance and collect the cost thereof from Tenant.
ARTICLE 10 - EMINENT DOMAIN
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If all or any substantial part of the Buiding or common areas shall be
acquired by the exercise of eminent domain, Landlord may terminate this Lease by
giving written notice to Tenant on or before the date that actual possession
thereof is so taken. If all or any part of the Leased Premises shall be acquired
by the exercise of eminent domain so that the Leased Premises shall become
unusable by Tenant for the Permitted Use, Tenant may terminate this Lease as of
the date that actual possession thereof is so taken by giving written notice to
Landlord. All damages awarded shall belong to Landlord, provided, however, that
Tenant may claim dislocation damages if such amount is not subtracted from
Landlord's award.
ARTICLE 11 - ASSIGNMENT AND SUBLEASE
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Tenant shall not assign this lease or sublet the Leased Premises in whole
or in part without Landlord's prior written consent, which consent shall not be
unreasonably withheld, delayed or denied (provided that it shall not be
unreasonable for Landlord to withhold or deny its consent with respect to any
proposed assignment or subletting to a third party that is already a tenant in
the Building or the Park). In the event of any assignment or subletting, Tenant
shall remain primarily liable hereunder, and any extension, expansion, rights of
first offer, rights of first refusal or other options granted to Tenant under
this Lease shall be rendered void and of no further force or effect. The
acceptance of rent from any other person shall not be deemed to be a waiver of
any of the provisions of this Lease or to be a consent to the assignment of this
Lease or the subletting of the Leased Premises. Without in any way limiting
Landlord's right to refuse to consent to any assignment or subletting of this
Lease, Landlord reserves the right to refuse to give such consent if in
Landlords' opinion (i) the Leased Premises are or may be in any way adversely
affected; (ii) the business reputation of the proposed assignee or subtenant is
unacceptable; or (iii) the financial worth of the proposed assignee or subtenant
is insufficient to meet the obligations hereunder. Landlord further expressly
reserves the right to refuse to give its consent to any subletting if the
proposed rent is to be less than the then current rent for similar premises in
the Park. Tenant agrees to reimburse Landlord for reasonable accounting and
attorneys' fees incurred in conjunction with the processing and documentation of
any such requested assignment, subletting or any other hypothecation of this
Lease or Tenant's interest in and to the Leased Premises.
ARTICLE 12 - TRANSFERS BY LANDLORD
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Section 12.01. Sale of the Building. Landlord shall have the right to sell
the Building at any time during the Lease Term, subject only to the rights of
Tenant hereunder; and such sale shall operate to release Landlord from
liability hereunder after the date of such conveyance.
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Section 12.02. Subordination and Estoppel Certificate. Landlord shall have
the right to subordinate this Lease to any mortgage presently existing or
hereafter placed upon the Building by so declaring in such mortgage. Within ten
(10) days following receipt of a written request from Landlord, Tenant shall
execute and deliver to Landlord, without cost, any instrument which Landlord
deems necessary or desirable to confirm the subordination of this Lease and an
estoppel certificate in such form as Landlord may reasonably request certifying
(i) that this Lease is in full force and effect and unmodified or stating the
nature of any modification, (ii) the date to which rent has been paid, (iii)
that there are not, to Tenant's knowledge, any incurred defaults or specifying
such defaults if any are claimed, and (iv) any other matters or state of facts
reasonably required respecting the Lease. Such estoppel may be relied upon by
Landlord and by any purchaser or mortgagee of the Building. Notwithstanding the
foregoing, if the mortgagee shall take title to the Leased Premises through
foreclosure or deed in lieu of foreclosure, Tenant shall be allowed to continue
in possession of the Leased Premises as provided for in this Lease so long as
Tenant shall not be in default.
ARTICLE 13 - DEFAULT AND REMEDY
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Section 13.01. Default. The occurrence of any of the following shall be a
"Default":
(a) Tenant fails to pay any Monthly Rental Installment or Additional Rent
within ten (10) days after the same is due, or Tenant fails to pay any other
amounts due Landlord from Tenant within ten (10) days after the same is due.
(b) Tenant fails to perform or observe any other term, condition, covenant
or obligation required under this Lease for thirty (30) days after written
notice thereof from Landlord; provided, however, that if the nature of Tenant's
default is such that more than thirty days are reasonably required to cure,
then such default shall be deemed to have been cured if Tenant commences such
performance within said thirty-day period and thereafter diligently completes
the required action within a reasonable time.
(c) Tenant shall assign or sublet all or a portion of the Leased Premises
in contravention of the provisions of Article 11 of this Lease.
(d) All or substantially all of Tenant's assets in the Leased Premises or
Tenant's interest in this Lease are attached or levied under execution (and
Tenant does not discharge the same within sixty (60) days thereafter); a
petition in bankruptcy, insolvency or for reorganization or arrangement is
listed by or against Tenant (and Tenant fails to secure a stay or discharge
thereof within sixty (60) days thereafter): Tenant is insolvent and unable to
pay its debts as they become due; Tenant makes a general assignment for the
benefit of creditors; Tenant takes the benefit of any insolvency action or law;
the appointment of a receiver or trustee in bankruptcy for Tenant or its assets
if such receivership has not been vacated or set aside within thirty (30) days
thereafter; or, dissolution or other termination of Tenant's corporate charter
if Tenant is a corporation.
Section 13.02. Remedies. Upon the occurrence of any Default, Landlord shall
have the following rights and remedies, in addition to those allowed by law or
in equity, any one or more of which may be exercised without further notice to
Tenant:
(a) Landlord may apply the Security Deposit or re-enter the Leased Premises
and cure any default of Tenant, and Tenant shall reimburse Landlord as
additional rent for any costs and expenses which Landlord thereby incurs; and
Landlord shall not be liable to Tenant for any loss or damage which Tenant may
sustain by reason of Landlord's action.
(b) Landlord may terminate this Lease or, without terminating this Lease,
terminate Tenant's right to possession of the Leased Premises as of the date of
such Default, and thereafter (i) neither Tenant nor any person claiming under or
through Tenant shall be entitled to possession of the Leased Premises and Tenant
shall immediately surrender the Leased Premises to Landlord; and (ii) Landlord
may re-enter the Leased Premises and dispossess Tenant and any other occupants
of the Leased premises by any lawful means and may remove their effects, without
prejudice to any other remedy which Landlord may have. Upon the termination of
this Lease, Landlord may declare the present value (discounted at the Prime
Rate) of all rent which would have been due under this Lease for the balance of
the Lease Term to be immediately due and payable, whereupon Tenant shall be
obligated to pay the same to Landlord, together with all loss or damage which
Landlord may sustain by reason of Tenants' default ("Default Damages"), which
shall include without limitation expenses of preparing the Leased Premises for
re-letting, demolition, repairs, tenant finish improvements, brokers'
commissions and attorneys' fees, if being expressly understood and agreed that
the liabilities and remedies specified in this subsection (b) shall survive the
termination of this Lease.
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(c) Landlord may, without terminating this Lease, re-enter the Leased
Premises and re-let all or any part thereof for a term different from that which
would otherwise have constituted the balance of the Lease Term and for rent and
on terms and conditions different from those contained herein, whereupon Tenant
shall be immediately obligated to pay to Landlord as liquidated damages the
present value (discounted at the Prime Rate) of the difference between the rent
provided for herein and that provided for in any lease covering a subsequent
re-letting of the Leased Premises, for the period which would otherwise have
constituted the balance of the Lease Term, together with all of Landlord's
Default Damages.
(d) Landlord may xxx for injunctive relief or to recover damages for any
loss resulting from the Default.
Section 13.03. Landlord's Default and Tenant's Remedies. Landlord shall be
in default if it fails to perform any term, condition, covenant or obligation
required under this Lease for a period of thirty (30) days after written notice
thereof from Tenant to Landlord; provided, however, that if the term, condition,
covenant or obligation to be performed by Landlord is such that it cannot
reasonably be performed within thirty (30) days, such default shall be deemed to
have been cured if Landlord commences such performance within said thirty-day
period and thereafter diligently undertakes to complete the same. Upon the
occurrence of any such default, Tenant may xxx for injunctive relief or to
recover damages for any loss directly resulting from the breach, but Tenant
shall not be entitled to terminate this Lease or withhold, offset or xxxxx any
sums due hereunder.
Section 13.04. Limitation of Landlord's Liability. If Landlord shall fail
to perform any term, condition, covenant or obligation required to be performed
by it under this Lease and if Tenant shall, as a consequence thereof, recover a
money judgment against Landlord, Tenant agrees that it shall look solely to
Landlord's right, title and interest in and to the Building for the collection
of such judgment; and Tenant further agrees that no other assets of Landlord
shall be subject to levy, execution or other process for the satisfaction of
Tenant's judgment.
Section 13.05. Nonwaiver of Defaults. Neither party's failure or delay in
exercising any of its rights or remedies or other provisions of this Lease shall
constitute a waiver thereof or affect its right thereafter to exercise or
enforce such right or remedy or other provision. No waiver of any default shall
be deemed to be a waiver of any other default. Landlord's receipt of less than
the full rent due shall not be construed to be other than a payment on account
of rent then due, nor shall any statement on Tenant's check or any letter
accompanying Tenant's check be deemed an accord and satisfaction. No act or
omission by Landlord or its employees or agents during the Lease Term shall be
deemed an acceptance of a surrender of the Leased Premises, and no agreement to
accept such a surrender shall be valid unless in writing and signed by Landlord.
Section 13.06. Attorneys' Fees. If either party defaults in the performance
or observance of any of the terms, conditions, covenants or obligations
contained in this Lease and the non-defaulting party obtains a judgment against
the defaulting party, then the defaulting party agrees to reimburse the
non-defaulting party for reasonable attorneys' fees incurred in connection
therewith.
ARTICLE 14 - LANDLORD'S RIGHT TO RELOCATE TENANT
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Landlord shall have the right upon at least thirty (30) days' prior written
notice to Tenant to relocate Tenant and to substitute for the Leased Premises
other space in the Building or in the Park containing at least as much rentable
area as the Leased Premises. Such substituted space shall be improved by
Landlord, at its expense, with improvements at least equal in quantity and
quality to those in the Leased Premises. Landlord shall reimburse Tenant for all
reasonable expenses incurred in connection with such relocation. In no event
shall Landlord be liable to Tenant for any consequential damages as a result of
any such relocation, including, but not limited to, loss of business income or
opportunity.
ARTICLE 15 - TENANT'S RESPONSIBILITY REGARDING
ENVIRONMENTAL LAWS AND HAZARDOUS SUBSTANCES
----------------------------------------------
Section 15.01. Definitions.
a. "Environmental Laws" - All present or future federal, state and
municipal laws, ordinances, rules and regulations applicable to the
environmental and ecological condition of the Leased Premises, the rules and
regulations of the Federal Environmental Protection Agency or any other federal,
state or municipal agency or governmental board or entity having jurisdiction
over the Leased Premises.
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b. "Hazardous Substances"
Those substances included within the definitions of "hazardous substances,"
"hazardous materials," "toxic substances," "solid waste" or "infectious waste"
under Environmental Laws.
Section 15.02. Compliance. Tenant, at its sole cost and expense, shall
promptly comply with the Environmental Laws including any notice from any source
issued pursuant to the Environmental Laws or issued by any insurance company
which shall impose any duty upon Tenant with respect to the use, occupancy,
maintenance or alteration of the Leased Premises whether such notice shall be
served upon Landlord or Tenant.
Section 15.03. Restrictions on Tenant. Tenant shall operate its business
and maintain the Leased Premises in compliance with all Environmental Laws.
Tenant shall not cause or permit the use, generation, release, manufacture,
refining, production, processing, storage or disposal of any Hazardous
Substances on, under or about the Leased Premises, or the transportation to or
from the Leased Premises of any Hazardous Substances, except as necessary and
appropriate for its Permitted Use in which case the use, storage or disposal of
such Hazardous Substances shall be performed in compliance with the
Environmental Laws and the highest standards prevailing in the industry.
Section 15.04. Notices, Affidavits, Etc. Tenant shall immediately notify
Landlord of (i) any violation by Tenant, its employees, agents, representatives,
customers, invitees or contractors of the Environmental Laws on, under or about
the Leased Premises, or (ii) the presence or suspected presence of any Hazardous
Substances, on, under or about the Leased Premises and shall immediately deliver
to Landlord any notice received by Tenant relating to (i) and (ii) above from
any source. Tenant shall execute affidavits, representations and the like within
five (5) days of Landlord's request therefor concerning Tenant's best knowledge
and belief regarding the presence of any Hazardous Substances on, under or about
the Leased Premises.
Section 15.05. Landlord's Rights. Landlord and its agents shall have the
right, but not the duty, upon advance notice (except in the case of emergency
when no notice shall be required) to inspect the Leased Premises and conduct
tests thereon to determine whether or the extent to which there has been a
violation of Environmental Laws by Tenant or whether there are Hazardous
Substances on, under or about the Leased Premises. In exercising its rights
herein, Landlord shall use reasonable efforts to minimize interference with
Tenant's business but such entry shall not constitute an eviction of Tenant, in
whole or in part, and Landlord shall not be liable for any interference, loss,
or damage to Tenant's property or business ensued thereby.
15.06. Tenant's Indemnification. Tenant shall indemnify Landlord and
Landlord's managing agent from any and all claims, losses, liabilities, costs,
expenses and damages, including attorneys' fees, costs of testing and
remediation costs, incurred by Landlord in connection with any breach by Tenant
of its obligations under this Article 15. The covenants and obligations under
this Article 15 shall survive the expiration or earlier termination of this
Lease.
Section 15.07. Landlord's Representation. Notwithstanding anything
contained in this Article 15 to the contrary, Tenant shall not have any
liability to Landlord under this Article 15 resulting from any conditions
existing, or events occurring, or any Hazardous Substances existing or
generated, at, in, on, under or in connection with the Leased Premises prior to
the Commencement Date of this Lease except to the extent Tenant exacerbates the
same.
ARTICLE 16 - MISCELLANEOUS
--------------------------
Section 16.01. Benefit of Landlord and Tenant. This lease shall inure to
the benefit of and be binding upon Landlord and Tenant and their respective
successors and assigns.
Section 16.02. Governing Law. This Lease shall be governed in accordance
with the laws of the State where the building is located.
Section 16.03. Guaranty. In consideration of Landlord's leasing the Leased
Premises to Tenant, Tenant shall provide Landlord with a Guaranty of Lease
executed by the guarantor(s) described in the Basic Lease Provisions, if any.
Section 16.04. Force Majeure. Landlord and Tenant (except with respect to
the payment of any monetary obligation) shall be excused for the period of any
delay in the performance of any obligation hereunder when such delay is
occasioned by causes beyond its control, including but not
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limited to work stoppages, boycotts, slowdowns or strikes; shortages of
materials, equipment, labor or energy; unusual weather conditions; or acts or
omissions of governmental or political bodies.
Section 16.05. Examination of Lease. Submission of this instrument for
examination or signature to Tenant does not constitute a reservation of or
option for Lease, and it is not effective as a Lease or otherwise until
execution by and delivery to both Landlord and Tenant.
Section 16.06. Indemnification for Leasing Commissions. The parties hereby
represent and warrant that the only real estate brokers involved in the
negotiation and execution of this Lease are the Brokers. Each party shall
indemnify the other from any and all liability for the breach of this
representation and warranty on its part and shall pay any compensation to any
other broker or person who may be entitled thereto.
Section 16.07. Notices. Any notice required or permitted to be given under
this Lease or by law shall be deemed to have been given if it is written and
delivered in person or by overnight courier or mailed by certified mail, postage
prepaid, to the party who is to receive such notice at the address specified in
Article 1. If delivered in person, notice shall be deemed given as of the
delivery date. If sent by overnight courier, notice shall be deemed given as of
the first business day after sending. If mailed, the notice shall be deemed to
have been given on the date which is three business days after mailing. Either
party may change its address by giving written notice thereof to the other
party.
Section 16.08. Partial Invalidity; Complete Agreement. If any provision of
the Lease shall be held to be invalid, void or unenforceable, the remaining
provisions shall remain in full force and effect. This Lease represents the
entire agreement between Landlord and Tenant covering everything agreed upon or
understood in this transaction. There are no oral promises, conditions,
representations, understandings, interpretations or terms of any kind as
conditions or inducements to the execution hereof or in effect between the
parties. No change or addition shall be made to this Lease except by a written
agreement executed by Landlord and Tenant.
Section 16.09. Financial Statements. During the Lease Term and any
extensions thereof, Tenant shall provide to Landlord on an annual basis, within
ninety (90) days following the end of Tenant's fiscal year, a xxx of Tenant's
most recent financial statements (certified and audited if the Minimum Annual
Rent hereunder exceeds $100,000) prepared as of the end of Tenant's fiscal year.
Such financial statements shall be signed by Tenant who shall attest to the
truth and accuracy of the information set forth in such statements. All
financial statements provided by Tenant and Landlord hereunder shall be prepared
in conformity with generally accepted accounting principles, consistently
applied.
Section 16.10. Representations and Warranties. The undersigned represent
and warrant the (i) such party is duly organized, validly existing and in good
standing (if applicable) in accordance with the laws of the state under which it
was organized; and (ii) the individual executing and delivering this Lease has
been properly authorized to do so, and such execution and delivery shall bind
such party.
Section 16.11. Early Occupancy. Provided the Leased Premises are ready for
occupancy, Landlord will allow Tenant to take possession of the Leased Premises
on or after January 1, 1999, (the "Early Occupancy Date"). All terms and
conditions of this Lease will become effective upon the Early Occupancy Date
except for payment of Base Rent which will commence on February 1, 1999. In
accordances with the provisions set forth in subsection H of the Basic Lease
Provisions and Definitions, the Commencement Date shall be postponed one day for
each day after the Early Occupancy Date that the Tenant does not get possession
of the Leased Premises from the Landlord.
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IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the
day and year first above written.
LANDLORD:
PARK 100 PROPERTIES, INC.,
a Delaware corporation
By: Duke Realty Services Limited
Partnership, an Indiana limited
partnership, as Agent
By: Duke Services, Inc.,
its General Partner
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Xxxxxxx X. Xxxxxx
Vice President and
General Manager
Indiana Industrial Group
TENANT:
HAT WORLD, INC., a Minnesota corporation
By: /s/ Xxxxx Xxxxxxxx
---------------------------------------
Printed: Xxxxx Xxxxxxxx
Title: Sr. V.P.
STATE OF Indiana )
) SS:
COUNTY OF Xxxxxxx )
Before me, a Notary Public in and for said County and State, personally
appeared Xxxxx Xxxxxxxx, by me known and by me known to be the Senior Vice
President of Hat World, Inc., a Minnesota corporation, who acknowledged the
execution of the above and foregoing Lease Agreement for and on behalf of said
corporation.
WITNESS my hand and Notarial Seal this 30th day of November, 1998.
/s/ Xxxxxx X. Xxxxxxx
--------------------------------------------
Notary Public
Xxxxxx X. Xxxxxxx
--------------------------------------------
(Printed Signature)
My Commission Expires:
[Notary Stamp]
My County of Residence:
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EXHIBIT "A"
[Floor Plan]
XXXX. 00 -- PARK 100
83,200 S.F. ALL ADDRESSES ARE XXXXXXXX XXXXX
00/0/00 XXXXX0
HAT WORLD, INC. EXHIBIT B
Building 64, Park 100 TENANT FINISH IMPROVEMENTS
0000 Xxxxxxxx Xxxxx REVISED November 30, 1998
Xxxxxxxxxxxx, Xxxxxxx 00000 Page 1 of 1
Tenant agrees to pay Landlord an amount not to exceed $2,500.00 for Landlord's
work to close the openings in the west demising wall, create a new exterior
entrance and demolish four (4) feet of interior wall as shown below. Tenant
shall pay to Landlord said amount within thirty (30) days after Landlord
completes Landlord's work to Tenant's satisfaction and after Tenant's receipt of
Landlord's itemized xxxx for Landlord's work.
[Floor Plan]
DUKE [LOGO & COMPANY INFORMATION]
