LEASE
THIS LEASE is made as of March 1, 1999 between PARK STREET INDUSTRIAL
LLC, a Wisconsin limited liability company ("Landlord") and TRAK INTERNATIONAL,
INC., a Delaware corporation ("Tenant").
DATA SHEET
The following terms shall have the meanings set forth in this section,
unless otherwise specifically modified elsewhere in this Lease:
(1) "Facility": Approximately 269,400 square foot office/manufacturing
facility located at 000 Xxxxx Xxxx Xxxxxx, Xxxx Xxxxxxxxxx, Xxxxxxxxx consisting
of the Buildings and the Land legally described in Exhibit A, as may be adjusted
from time to time.
(2) "Land": The real property, legally described in Exhibit A, on which
the Buildings are situated consisting of an approximately ten and one-half
(10.5) acre parcel as depicted on Exhibit A-1 and an additional seven (7) acre
parcel to the south of the Facility as depicted on Exhibit A-2 as the
"Additional Parcel".
(3) "Buildings": The approximately 269,400 rentable square feet of
buildings situated on the Land, as depicted on Exhibit B, as may be adjusted
from time to time.
(4) "New Building": The approximately 40,880 square foot manufacturing
facility to be built on the area depicted on Exhibit B-1 as the "New Building
Location Area", all in accordance with the Work Letter attached as Exhibit D.
(5) "Premises": The area outlined on the Floor Plan of the Buildings
attached as Exhibit B. For purposes of this Lease, the Premises shall be deemed
to contain 182,400 rentable square feet of space (177,700 square feet of
manufacturing space and 4,700 square feet of office space). The Premises shall
initially consist of buildings 1, 2, 3, 3A, 3B, 4, 4A, 5, 8, 8A, 8B, 13, 14, 15,
16A and 22 (the "Temporary Space"), buildings 17 and 25 ("Office Buildings") and
buildings 21, 23 and 24 (the "Base Buildings"), all as depicted on Exhibit B.
Upon completion of the New Building as set forth below, the Premises shall
consist of the New Building, the Office Buildings and the Base Buildings.
(6) "Commencement Date": April 1, 1999 or such earlier or later date as
provided in Section 2.2.
(7) "Expiration Date": March 31, 2009, unless otherwise extended or
terminated as provided in this Lease.
(8) "Term": Ten (10) years from the Commencement Date, as may be
extended or terminated as provided in this Lease. Tenant shall have two (2)
options to extend the Term for five (5) years each following the Expiration
Date.
(9) "Permitted Uses": Manufacturing and testing of construction
equipment and related accessories, service training and product display and
general office.
(10) "Base Rent": Base Rent shall be payable in equal monthly
installments commencing on April 1, 1999 and on the first day of each month
thereafter (calculated as follows: $2.50 per square foot of rentable square feet
of Base Buildings; $7.00 per rentable square foot of Office Buildings; $2.00 per
rentable square feet of Temporary Space; and upon delivery and acceptance by
Tenant, $4.00 per square foot of rentable square feet of New Building, and
demolition charges and
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construction adjustments), all as set forth in the
attached Exhibit F. Base Rent shall be adjusted as provided in this Lease.
(11) "Tenant's Percentage": 69%.
(12) "Security Deposit": $0.
(13) Addresses for notices, consents, and payments:
Landlord: Tenant:
Park Street Industrial LLC Trak International, Inc.
c/o Xxxx Xxxxx Real Estate Corp. d/b/a Sky Trak International
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000 000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000 Xxxx Xxxxxxxxxx, Xxxxxxxxx 00000
Article 1. PREMISES
1.1 Demise. Landlord leases to Tenant and Tenant rents from Landlord
the Premises and the Land, for the Term and in accordance with the provisions of
this Lease.
1.2 Landlord's Title; Covenant of Quiet Enjoyment. Landlord warrants
that it owns the Facility free and clear of any easements or other encumbrances
or restrictions that might impair Tenant's rights under this Lease. As long as
no uncured Event of Default (defined below) exists and the Lease is in full
force, Landlord covenants that Tenant shall peaceably and quietly enjoy the
Premises free from any claims of Landlord or persons claiming through Landlord,
subject to the provisions of the Lease.
1.3 Utilities. Tenant shall pay for all utilities or services furnished
to the Premises or used by Tenant, including water, sewer, gas, electricity,
fuel, light, heat, power and cable television, whether determined by separate
metering (which Landlord may provide at Landlord's option and expense) or billed
by Landlord to Tenant as Tenant's Share of Operating Expenses. Landlord shall
not be liable for any interruption or failure in the supply of utilities to the
Premises. To the extent Tenant has control of the thermostat regulating the
level of heat in the Premises, Tenant shall maintain a sufficient level of heat
in the Premises to prevent freezing and other damages to the Premises and the
Facility.
1.4 Signs. Tenant may, at Tenant's expense, install and maintain one
sign at the entry to the Premises identifying Tenant and any other permitted
occupants as the occupants of the Premises. The appearance and location of the
sign must conform, in Landlord's reasonable judgment, with Facility standards.
Installation and maintenance of the sign shall be subject to the provisions
governing improvements and alterations to the Premises below. Landlord approves
Tenant's signs in existence as of the date of this Lease.
1.5 Common Areas. Tenant's use and occupancy of the Premises shall
include the reasonable nonexclusive use of the "Common Areas," defined as the
parking areas, service roads, sidewalks, landscaped areas, lobbies, atriums,
elevators, stairways, corridors, restrooms and other areas so designated by
Landlord within the Facility. Tenant shall not encumber or obstruct the Common
Areas, nor allow them to be obstructed or encumbered, nor place anything in the
Common Areas without Landlord's prior consent.
1.6 Facility Systems. Landlord may install, use, maintain, repair and
replace pipes, cables, conduits, plumbing, vents and telephone, electric and
other wires and other items in the Premises to the extent Landlord deems
appropriate for the proper operation and maintenance of the Facility. Except in
the case of an emergency,
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Landlord shall give Tenant at least 24 hours prior notice to the installation,
maintenance, repair or replacement of facility systems pursuant to this Section
1.6 and Landlord shall use its best efforts to complete such work without
material interruption of Tenant's operations.
1.7 No Easements. No implied easements are granted by this Lease.
Landlord may close any portion of Building or Land areas to the extent as may,
in Landlord's opinion, be necessary to prevent a dedication of or accrual of
rights in those areas to any person or the public.
1.8 Landlord's Access. Landlord shall have access to the Premises at
all reasonable times on 24 hours prior notice, and at any time in an emergency,
for inspection, showing for lease or sale, performing maintenance and repairs
and for all other purposes contemplated elsewhere in this Lease.
Article 2. TERM
2.1 Commencement Date. The Term shall begin on the Commencement Date
specified in the Data Sheet. This Lease shall be null and void if Landlord fails
to purchase the Premises and Land and obtain all necessary governmental
approvals of the Permitted Uses on or before April 1, 1999.
2.2 Delayed or Early Possession.
(a) If Landlord fails to deliver possession by the
Commencement Date set forth in the Data Sheet, Tenant's obligation to pay Base
Rent and Additional Rent (defined below; referred to collectively with Base Rent
as "Rent") shall not commence until possession is delivered. However, this Lease
shall remain in full force and the Expiration Date shall not be modified.
Landlord shall not be subject to any claims or liability for failure to deliver
possession of the Premises on the Commencement Date set forth in the Data Sheet.
(b) If Tenant is given and accepts possession of the Premises
before the Commencement Date set forth in the Data Sheet, the Term and all
Tenant's obligations under this Lease, including Tenant's obligation to pay
Rent, shall begin on the date possession is accepted, but the Expiration Date
shall not be modified.
2.3 Expiration Date. The Term of this Lease shall end on the Expiration
Date specified in the Data Sheet.
2.4 Options to Extend. Tenant shall have two (2) options to extend the
Term for a period of five (5) years each. Tenant shall exercise its options to
extend by providing Landlord with written notice at least six (6) months prior
to the expiration of the then current Term. The Term, if extended, shall be on
the same terms and conditions set forth in this Lease, including annual
adjustment to Base Rent and Additional Rent.
2.5 Rent Prorations. In any partial month or year during the Term, or
if Tenant is unable to operate its business in the Premises in the manner and on
each day as required under this Lease due to fire or other casualty or
condemnation of any part of the Facility, Rent for the partial month, year or
the time affected by Tenant's inability to operate shall be prorated on a daily
basis.
Article 3. USE
3.1 Permitted Uses. Tenant shall use the Premises only for Permitted
Uses and for no other purpose without Landlord's prior consent, which may be
withheld in Landlord's reasonable discretion.
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3.2 Exclusive Uses. Landlord may grant other occupants of the Facility
exclusive rights to engage in particular uses at the Facility, provided such
uses do not impair the Permitted Uses granted to Tenant pursuant to this Lease.
3.3 Compliance with Law, Etc. Tenant shall not commit at the Facility
or permit on the Premises any (a) violation of law (including, without
limitation, the Americans With Disabilities Act) or private restriction; (b)
public or private nuisance; (c) act or condition in the Premises that would
invalidate or conflict with any insurance policy covering the Facility, the
Premises or property in either or make insurance unavailable or more expensive;
(d) waste; or (e) other act or thing that could injure the reputation of the
Facility or disturb any other occupant of the Facility.
3.4 Signs. Tenant shall not place on the Premises signs, lettering,
displays, advertising or pictures visible from outside the Premises (including
on windows or doors) without Landlord's prior approval, which shall not be
unreasonably withheld.
3.5 Locks. Tenant shall not change any locks in the Premises without
Landlord's prior consent. This provision shall not apply to Tenant's safes or
other areas maintained by Tenant for the safety and security of money,
securities, negotiable instruments, confidential business information, trade
secrets and practices or other valuables.
3.6 Floor Loads. Tenant shall not use the Facility in any manner that
would exceed recommended floor load limits.
3.7 Notice of Conditions. Landlord gives Tenant exclusive control of
the Premises and shall have no obligation to inspect the Premises. Tenant shall
promptly report to Landlord any defective condition in the Facility known to
Tenant. If Tenant fails to report any known defective condition, Tenant shall be
responsible to Landlord for any liability or expense (including reasonable
attorney's fees) incurred by Landlord that would not have been incurred had
Tenant promptly reported the defective condition to Landlord.
Article 4. BASE RENT
4.1 Base Rent. Tenant shall pay to Landlord, without set off, deduction
or demand, Base Rent, as adjusted from time to time, in monthly installments in
advance on or before the first day of each month.
4.2 Base Rent Adjustment. Commencing on April 1, 2002 and the same day
each year thereafter (each an "Adjustment Date"), including any extension of
time, Base Rent shall be adjusted to be an annual amount equal to the greater of
(a) Base Rent payable by Tenant immediately preceding the Adjustment Date, and
(b) Base Rent plus the CPI Adjustment (as defined below). The "CPI Adjustment"
means the amount determined by multiplying the figure being adjusted by a
fraction, (a) the numerator of which is the difference between (1) the Index
(defined below) as of the date of the adjustment and (b) the Index as of the
date of this Lease; and (b) the denominator of which is the Index as of the date
of this Lease. The "Index" is the Consumer Price Index, United States City
Average, All Urban Consumers and All Items (19821984 = 100), published by the
Bureau of Labor Statistics of the United States Department of Labor, provided
that Landlord shall have the right to choose a reasonably comparable substitute
index if this Index ceases to be available or undergoes a material change in its
method of computation. Notwithstanding the foregoing, the Base Rent shall not be
increased more than ten percent (10%) in any one year during the Term or any
extension thereof.
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Article 5. ADDITIONAL RENT
5.1 Definition of "Taxes".
(a) For purposes of this Lease, "Taxes" shall mean the
following items:
(1) General real estate taxes relating to the
Facility.
(2) Installments of special assessments,
including interest, relating to the
Facility, in the smallest annual amount
permitted to be paid by law or Landlord's
mortgage lender or ground lessor.
(3) Personal property taxes relating to
Landlord's fixtures at the Facility or
Landlord's personal property used in
connection with operation or maintenance of
the Facility.
(4) Landlord's expenses for professional and
other services (including but not limited to
fees and expenses of consultants, attorneys,
appraisers and experts) in connection with
efforts to secure lowered real estate tax
assessments on the Facility or to resist
increased assessments.
(b) Notwithstanding the foregoing definition,
(1) If any component of Taxes payable during any
calendar year relates to a period in excess
of twelve calendar months, the prorated
portions applicable to the excess periods
shall be included in Taxes for the years to
which they relate rather than the current
year.
(2) Taxes shall not include any income, excess
profits, franchise, estate, inheritance,
succession, capital levy or transfer taxes,
except to the extent any of these taxes are
imposed in lieu of real estate or other ad
valorem taxes.
(3) Taxes shall not include any utility
connection charges or special assessments
the amount of which is based on the use of
the Premises, the number or sizes of utility
meters dedicated to the Premises or any
other characteristic specific to the
Premises rather than to the Building, the
Land or the Facility as a whole. Tenant
shall pay 100% of all such sums to Landlord
as Additional Rent as provided below.
5.2 Definition of "Operating Expenses".
(a) For purposes of this Lease, "Operating Expenses" shall
mean all expenses incurred by Landlord with respect to the ownership and
operation of the Facility as determined by Landlord in accordance with
accounting principles consistently followed. The term includes, but is not
limited to, the following expenses:
(1) Premiums for fire, extended coverage and
general liability insurance required of
Landlord under this Lease.
(2) Costs of services, supplies and materials
incurred in connection with and cleaning,
maintenance, repairs, redecorating,
utilities and other services provided by
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Landlord under this Lease, to the extent not
separately charged to occupants of the
Facility, excluding Tenant Improvements to
be completed by Landlord under this Lease.
(3) Electricity, telephone, cable, water, sewer,
gas and other fuel, air conditioning and
other utility charges, all to the extent
provided and not separately paid by
occupants of the Facility directly to the
utility providers.
(4) Expenses allocated to the Facility under
easement agreements, service or operating
agreements, declarations, covenants or other
instruments providing for sharing of
facilities or payment for services.
(5) Reasonable charges to amortize, over their
reasonable life on a straight line basis,
any and all improvements or alterations to
the Facility, or equipment installed in it,
solely for the purpose of reducing Operating
Expenses or complying with legal or
insurance requirements that were not
mandatory as of the Commencement Date.
(6) The total cost, including compensation and
fringe benefits, of Landlord's employees
whose duties are connected with the
operation and maintenance of the Facility
(but only for the portion of their time
allocable to work related to the Facility).
(7) Management fees equal to two percent (2%) of
gross collections for the Premises (Base and
Additional Rent).
(b) Notwithstanding the foregoing definition, Operating
Expenses shall not include the following expenses:
(1) Taxes, as defined above.
(2) Costs paid to Landlord's affiliates to the
extent they exceed competitive levels.
(3) Costs of any capital improvement to the
Facility or depreciation allowance or
expense, except as specifically included
above.
(4) Costs of repairing or replacing any items
covered by insurance or warranty, to the
extent insurance or warranty proceeds are
made available to Landlord to pay the costs.
(5) Costs of leasing, procuring or renovating
space for occupants of the Facility.
(6) Legal expenses incident to enforcement of
any lease.
(7) Interest and principal payments on any loan
or ground rental payments.
(8) Reserves for future expenses.
(9) Bad debt expenses or reserves.
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(10) Costs related to any refinancing or sale of
the Facility.
(11) Costs in connection with any dispute
relating to Landlord's title to the
Facility.
(12) Costs resulting from Landlord's or its
agents' negligence, violation of law,
violation of any lease in the Facility or
failure to pay any xxxx before delinquency.
(c) If Landlord selects the accrual method of accounting
rather than the cash method for operating expense purposes, Operating Expenses
shall be deemed to have been paid when accrued.
5.3 Payment. Tenant shall pay as "Additional Rent," without set off,
deduction or demand, Tenant's Percentage of Taxes, Tenant's Percentage of
Operating Expenses and all other amounts permitted to be imposed against Tenant
under any other provision of this Lease concurrently with the next succeeding
installment of Base Rent following notice of the amount of the Additional Rent,
unless a different time for payment is specified in this Lease.
5.4 Estimate. Before the Commencement Date and during December of each
year during the Term or as soon afterward as is practicable, Landlord shall
notify Tenant of Landlord's estimate of the Additional Rent payable to Landlord
under this Article during the first year and for the following year of the Term,
respectively. On or before the first day of each month after each notice, Tenant
shall pay to Landlord 1/12th of the estimated Additional Rent for that year. If
notice is not given when required, Tenant shall continue to pay on the basis of
the prior estimate until the first day of the month after the month in which
notice is given, at which time Tenant shall pay any shortage, or receive a
credit for any overage, arising from the payments that should have been made
according to the new estimate. If at any time it appears to Landlord that the
Additional Rent payable for the current year will vary from Landlord's estimate,
Landlord shall notify Tenant of Landlord's revised estimate for that year, and
Tenant's subsequent payments during that year shall be based on the revised
estimate. Landlord estimates Additional Rent for the initial year of the Lease
at less than $1.00 per square foot.
5.5 Annual Adjustment.
(a) Within 90 days after the end of each year during the Term
or as soon afterward as is practicable, Landlord shall notify Tenant of the
total Additional Rent payable to Landlord under this Article for that year. If
the Additional Rent payable exceeds the Additional Rent paid by Tenant, Tenant
shall pay the excess to Landlord within 30 days after Landlord's notice. If the
Additional Rent owed is less than the Additional Rent paid, Landlord shall
credit the overpayment toward the next accruing Rent.
(b) Tenant may, by notice to Landlord within 30 days after
Landlord's notice of Additional Rent, require an audit of Landlord's books and
records relating to Additional Rent for the preceding calendar year. Landlord
shall have the option of either providing Tenant with an audit prepared by an
independent certified public accountant or allowing Tenant access to Landlord's
books and records for purposes of performing the audit. If the audit indicates
Landlord has overstated Additional Rent by more than 5%, Landlord shall pay the
cost of the audit. Otherwise, Tenant shall pay the cost of the audit, provided
that if more than one occupant of the Facility has requested an audit, the cost
shall be divided among Tenant and the other occupants in proportion to their
Percentage Interests.
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5.6 Other Adjustments.
(a) Whenever the Facility is not 100% occupied during any part
of any calendar year during the Term, Tenant's Percentage as to that part of the
year shall be adjusted to the ratio the rentable square footage of the Premises
bears to the greater of (1) the total average rentable area leased (pursuant to
leases under which the term has commenced) in the Facility for that year, or (2)
95% of the total average rentable area of the Facility for that year.
(b) Whenever the Facility is not 100% occupied during any part
of any calendar year, the components of Taxes and Operating Expenses that vary
in relation to the level of occupancy of the Facility shall be "grossed up" as
to that part of the year so that Tenant is allocated its proportionate share of
actual Taxes and Operating Expenses.
(c) Whenever Landlord receives a property tax credit or
reduced assessment on the Facility during any part of any calendar year during
the Term, and the credit or reduction is granted under any law providing
favorable tax treatment for another tenant or tenant(s) of the Facility,
Tenant's Percentage of Excess Taxes shall be based on what Taxes would have been
without the credit or reduction.
(d) Notwithstanding anything in this Article to the contrary,
Landlord may specially assess Tenant for cost of additional electricity,
utilities, services or other items of Taxes or Operating Expenses (and shall
accordingly reduce the total amount of Taxes or Operating Expenses on which
Tenant's Percentage of Taxes or Tenant's Percentage of Operating Expense is
calculated) to the extent Tenant's use or consumption of these items warrants
such an assessment.
(e) Tenant's Percentage shall be equitably adjusted in the
event of a change in the number of rentable square feet of space in the Facility
or in the Premises.
5.7 Tenant's Personal Property Taxes. Tenant shall pay prior to
delinquency all taxes imposed on Tenant's improvements, fixtures or personal
property in the Premises. Tenant shall request a separate assessment and billing
for these taxes. If taxing authorities include in calculating Taxes on the
Facility the value of any property belonging to Tenant, Tenant shall pay all
Taxes attributable to that property directly to the taxing authorities; provided
such payment is not a duplication of Taxes separately billed and paid by Tenant.
5.8 Extension. Landlord's failure to notify Tenant of an amount due
from Tenant under this Article shall not be a waiver of Landlord's right to
collect that amount, but shall only extend the time for Tenant's payment to a
date allowing Tenant the period of time otherwise allowed for making the payment
had Landlord notified Tenant on time.
Article 6. INSURANCE, RELEASES, AND INDEMNIFICATIONS
6.1 Definitions. As used in this Article and elsewhere in this Lease:
(a) A party's "Indemnitees" are (1) its shareholders, members,
partners, venturers, beneficiaries or other principals, and (2) its directors,
officers, managers, trustees, employees, agents and other persons authorized to
act on its behalf; and
(b) A party's "Users" are (1) its Indemnitees, (2) its
customers, business associates and other invitees and licensees, and (3) in the
case of Tenant,
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its subtenants, and in the case of Landlord, its lessees (other than Tenant) and
their subtenants.
6.2 Landlord's Insurance.
(a) Landlord shall keep the Facility insured for Landlord's
own benefit in an amount equal to the Facility's replacement value (excluding
deductibles, coinsurance and foundation, grading and excavation costs) against
loss or damage by fire, windstorms, hail, explosion, vandalism, malicious
mischief, civil commotion and such other risks and coverages, including rental
interruption insurance, as are now or may in the future be customarily covered
with respect to buildings and improvements similar in construction, general
location, use, occupancy and design to the Facility ("Comparable Properties").
(b) Landlord shall maintain, for its benefit and the benefit
of its managing agent (if any), general public liability insurance against
claims for personal injury, death or property damage occurring at the Facility.
(c) These insurance provisions shall not limit or modify
Tenant's obligations under any provision of this Lease. All insurance premiums
paid by Landlord with respect to the Facility shall be considered "Operating
Expenses."
6.3 Tenant's Insurance.
(a) Tenant shall at its expense keep all machinery, equipment,
furniture, fixtures, personal property and business interests located at the
Premises and not belonging to Landlord insured for Tenant's benefit, in an
amount equal to the lesser of their full replacement value or insurable value,
against loss or damage by fire and such other risks as are now or may in the
future be customarily insured against by tenants in Comparable Properties
including, without limitation, windstorms, hail, explosions, vandalism, theft,
malicious mischief, civil commotion, water damage, sprinkler leakage and such
other coverage as Landlord or Tenant may deem appropriate or necessary.
(b) Tenant shall at its expense maintain general public
liability insurance for the mutual benefit of Landlord, mortgagees of the
Facility, Landlord's managing agent (if any) and Tenant against claims for
personal injury, death or property damage (including contractual liability
coverage applicable to this Lease and insuring Tenant's indemnification
obligations provided for below) occurring at the Premises, to the limits of at
least $2,000,000 in respect to the injury or death to a single person, at least
$2,000,000 in respect to any one accident and at least $5,000,000 in respect to
any property damage.
(c) Insurance policies maintained pursuant to this section
shall be written by companies reasonably satisfactory to Landlord that are
licensed or authorized to do business and in good standing in the state where
the Facility is located and have a rating issued by an insurance rating
organization (including, without limitation, A.M. Best & Company) of not less
than the second-best rating. The certificates evidencing such insurance, and
renewals or replacements at least 30 days before expiration of coverage, shall
be delivered to Landlord with evidence satisfactory to Landlord that the
premiums have been paid. The policies shall not be terminable without 30 days
prior written notice to Landlord. Any such coverage shall be deemed primary to
any liability coverage secured by Landlord.
6.4 Releases.
(a) Insurance policies maintained pursuant to this Article for
loss or damage by fire or other risks shall permit releases of liability as
provided below and
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include waiver of subrogation clauses as to Tenant and Landlord respectively.
Landlord and Tenant waive and release and discharge each other from all claims
or demands arising out of damage to destruction or loss of use of property
caused by fire or other casualty arising due to any act or omission of the other
or its Users and agree to look only to their respective insurance coverages in
the event of such a loss. Notwithstanding the foregoing releases, if any damage
to the Facility results from any act or omission of Tenant or its Users and any
of Landlord's loss is deductible, Tenant shall pay to Landlord the deductible
amount (not to exceed $5,000 per event). This paragraph shall not affect
Tenant's repair obligations under other provisions of this Lease.
(b) Except for claims arising out of Landlord's or its User's
intentional acts or omissions, to the extent not prohibited by law, Tenant
waives all claims, and Landlord and its Indemnitees shall not be liable to
Tenant, for damage during the Term to Tenant's property or business, including
consequential damages, occurring at the Facility. This paragraph shall apply
especially, but not exclusively, to damage caused by water, snow, frost, steam,
refrigerators, sprinkling devices, air conditioning apparatus, excessive heat or
cold, falling plaster, broken glass, sewage, gas, odors, noise, bursting or
leaking of pipes or plumbing fixtures or the flooding of basements or other
subsurface areas and shall apply equally whether damage results from the
negligent acts or omissions of Landlord's Users or any other persons and whether
damage results from any of the foregoing causes or otherwise.
(c) All property in the Facility belonging to Tenant or its
Users shall be at Tenant's sole risk. Except for the intentional acts of
omissions of Landlord or its Users, Landlord shall not be liable for damage,
theft or loss affecting this property and Tenant shall defend and indemnify
Landlord and its Indemnitees against claims and liability for injuries to this
property.
(d) Landlord does not warrant that any of the services
Landlord may supply will be free from interruption and these services are
subject to all laws, ordinances, regulations and guidelines of governmental
authorities. Tenant acknowledges that any one or more of these services may be
suspended by reason of accident, repairs, alterations, improvements or causes
beyond Landlord's reasonable control. Any such interruption of service shall not
be deemed an eviction or disturbance of Tenant's use and possession of the
Premises or any part of it or render Landlord liable to Tenant for damages by
abatement of Rent or relieve Tenant from performance of its obligations under
this Lease.
6.5 Indemnifications.
(a) Subject to Paragraph (c), Tenant shall indemnify Landlord
and Landlord's Indemnitees against any and all damages claimed to be suffered by
third parties (including reasonable attorneys' fees and all other costs and
liabilities incurred in connection with any action or proceeding brought with
respect to such a claim) arising from any (1) default by Tenant under this
Lease, (2) condition inconsistent with any representation or warranty made by
Tenant under this Lease, except to the extent caused by Landlord or its Users,
(3) act or negligence by Tenant or its Users, or (4) accident, injury or damage
in or about the Premises or the Facility to the extent caused by Tenant or its
Users. If an action or proceeding is brought against Landlord or any of its
Indemnitees with respect to such a claim, Tenant, on notice from Landlord, shall
resist or defend the action or proceeding by counsel reasonably satisfactory to
Landlord.
(b) Subject to Paragraph (c), Landlord shall indemnify Tenant
and Tenant's Indemnitees against any and all damages claimed to be suffered by
third parties (including reasonable attorneys' fees and all other costs and
liabilities incurred in connection with any action or proceeding brought with
respect to such a
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claim) arising from any (1) default by Landlord under this Lease, (2) condition
inconsistent with any representation or warranty made by Landlord under this
Lease, except to the extent caused by Tenant or its Users, (3) act or negligence
by Landlord or its Users, or (4) accident, injury or damage in or about the
Facility to the extent caused by Landlord or its Users. If an action or
proceeding is brought against Tenant or any of its Indemnitees with respect to
such a claim, Landlord, on notice from Tenant, shall resist or defend the action
or proceeding by counsel reasonably satisfactory to Tenant.
(c) Whenever Landlord and Tenant are jointly responsible
(whether with each other or with others) for damages suffered by a third party,
their indemnification obligations under this Section shall be limited to their
respective percentages of responsibility for the damages.
(d) These indemnification obligations do not apply to the
extent Landlord and Tenant have released each other from claims elsewhere in
this Lease.
(e) These indemnification obligations shall survive expiration
or earlier termination of this Lease.
Article 7. HAZARDOUS MATERIALS
7.1 Definitions. For purposes of this Lease:
(a) "Hazardous Material" is used in its broadest sense and
means any asbestos, petroleum based products, pesticides, paints and solvents,
polychlorinated biphenyl, lead, cyanide, DDT, acids, ammonium compounds and
other chemical products and any substance or material defined or designated as a
hazardous or toxic substance, material, waste, or other similar term, by any
Environmental Law.
(b) "Environmental Law" is used in its broadest sense and
means any federal, state, or local statute, ordinance, regulation, or court or
administrative order affecting the Facility presently in effect or promulgated
in the future, as amended from time to time, regulating hazardous or toxic
substances, including but not limited to the following statutes:
(1) Resource Conservation and Recovery Act of
1976, 42 U.S.C. ' 6901 et seq.
(2) Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 40
U.S.C. ' 1801 et seq.
(3) Clean Air Act, 42 U.S.C. " 74017626.
(4) Water Pollution Control Act (Clean Water Act
of 1977), 33 U.S.C. ' 1251 et seq.
(5) Insecticide, Fungicide and Rodenticide Act
(Pesticide Act of 1987), 7 U.S.C. ' 135 et
seq.
(6) Toxic Substances Control Act, 15 U.S.C. '
2601 et seq.
(7) Safe Drinking Water Act, 42 U.S.C. ' 300(f)
et seq.
(8) National Environmental Policy Act (NEPA) 42
U.S.C. ' 4321 et seq.
(9) Refuse Act of 1899, 33 U.S.C. ' 407 et seq.
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7.2 Tenant's Covenants. Tenant shall not cause or permit any Hazardous
Material to be brought on, kept, stored or used in or about the Facility by
Tenant or its Users, unless the Hazardous Material is necessary for Permitted
Uses and will at all times be used, kept, stored and disposed of in a manner
that complies at all times with all Environmental Laws and will not create an
undue risk to other occupants of the Building, giving consideration to the
nature of the Building. Tenant shall promptly notify Landlord of any possible
contamination of the Facility that becomes known to Tenant. Tenant shall
indemnify and hold Landlord harmless from and against any and all claims,
actions, damages, liabilities, costs, disbursements and costs and expenses of
investigation (including reasonable attorneys' fees) incurred by Landlord or its
agents arising out of or from the contamination by Hazardous Materials of the
Premises or Facility or violation of Environmental Laws which is permitted or
caused by Tenant, its agents or invitees after the date of this Lease, except to
the extent such contamination or violation is caused by Landlord, its agents or
third parties.
7.3 Remediation. In addition to Tenant's other obligations under this
Lease, if the presence of any Hazardous Material at the Facility caused or
permitted by Tenant results in any contamination of the Facility or the
violation of law, Tenant shall be responsible for the cost of all actions
necessary to return the Facility to the condition existing prior to the
introduction of the Hazardous Material or the violation of law. Landlord shall
have the option of taking such actions at Tenant's expense or requiring Tenant
to do so itself. If Landlord requires Tenant to take any such action, any work
required on the Facility shall be treated as if it were an alteration to the
Facility subject to Article 9 below. Further, Tenant shall on demand pay
Landlord the amount, if any, by which the Facility's value has decreased as a
result of the contamination or violation. Tenant's obligations under this
Paragraph shall survive expiration or earlier termination of this Lease.
7.4 Representation by Landlord. Except as disclosed in the Phase I
Environmental Site Assessment dated January 12, 1999 and prepared by Northern
Environmental and the Soil and Ground-Water Sampling Results dated February 19,
1999 and prepared by Northern Environmental, Landlord represents that to
Landlord's knowledge, the Premises and the Facility are free from contamination
by Hazardous Materials. Landlord shall not cause or permit any Hazardous
Material to be brought on, kept, stored or used in or about the Facility in
violation of any Environmental Laws. Landlord shall indemnify and hold Tenant
harmless from and against any and all claims, actions, damages, liabilities and
costs (including reasonable attorneys' fees, disbursements, costs and expenses
of investigation) incurred by Tenant or its agents arising out of or from the
contamination by Hazardous Materials of the Premises or Facility or violation of
Environmental Laws which occurred prior to the date of Tenant's initial
occupancy of the Facility, except to the extent such contamination or violation
was caused by Tenant or its agents.
Article 8. MAINTENANCE AND REPAIRS
8.1 Facility. Landlord shall maintain the exterior and structural
components of the Facility (including heating, air conditioning, electrical and
plumbing systems), the Common Areas and any signage shared by Tenant and others
in good order and repair and in compliance with applicable law. Landlord may,
upon reasonable prior notice (except in the case of an emergency, no notice
shall be required), temporarily close off Common Areas or entries to the
Facility or temporarily suspend services or amenities to facilitate maintenance
and repair work. Landlord shall schedule and perform maintenance and repairs so
as to minimize interference with Tenant's use of the Premises.
8.2 Premises. Tenant shall at its expense keep the Premises and
Tenant's signage (if any) in as good order, condition and repair as existed when
the Tenant Improvements were completed, reasonable wear and tear and damage from
casualties
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against which Landlord is required to insure excepted. Notwithstanding any
provisions of this Lease to the contrary, unless caused by a casualty against
which Landlord is required to insure, Tenant shall at its expense promptly
repair to Landlord's satisfaction all damage to the Facility caused by any act
or omission of Tenant or its Users. All repairs shall be in quality and class at
least equal to the original work and shall comply with all applicable laws.
8.3 Refuse. Tenant shall keep the Premises clean inside and out and
remove all refuse resulting from Tenant's operations. Tenant shall segregate
refuse as Landlord may reasonably require for recycling purposes, keep it in
covered containers and have it removed regularly to designated areas at the
Facility.
Article 9. IMPROVEMENTS AND ALTERATIONS
9.1 Consent Required. Tenant shall not make any improvements or
alterations to the Premises ("Work") without Landlord's prior consent, which
shall not be unreasonably withheld. Landlord may condition its consent on its
receipt of copies of contracts, plans, specifications, permits and licenses, and
on third party indemnifications, performance bonds and evidence of insurance
reasonably satisfactory to Landlord. Tenant shall defend and indemnify Landlord
against any and all claims and liability connected with the Work.
9.2 Labor. All Work shall be done by contractors or mechanics
reasonably satisfactory to Landlord. Tenant shall do no Work of a nature or in a
manner likely to result in a labor dispute or materially interfere with
operation of the Facility.
9.3 Compliance and Quality. All Work shall comply with all applicable
laws and insurance requirements (including, without limitation, worker's
compensation insurance laws and requirements) and shall be performed in a good
and workmanlike manner. All materials shall be new and of at least as good a
quality as those installed in the Premises on the Commencement Date. Tenant
shall permit Landlord to inspect construction operations in connection with the
Work. Landlord's approval and inspection of the Work shall not constitute an
assumption of responsibility for the accuracy and sufficiency of Tenant's plans
and specifications, or their compliance, or the compliance of any Work, with
applicable law, all of which shall be entirely Tenant's responsibility.
9.4 Expenses. Tenant shall pay the cost of all Work and the cost of
restoring the Facility to the condition that existed before commencement of the
Work. On completion of the Work, Tenant shall furnish Landlord with contractor's
affidavits, full and final lien waivers and receipted bills covering all labor
and materials.
9.5 Liens. Tenant shall notify all contractors that their lien rights
attach only to Tenant's interest in the Premises, and Landlord shall be entitled
to post a notice in the Premises to that effect during any Work. Tenant shall
cause to be discharged or bonded over, within 10 business days after filing, any
construction lien claim filed against the Facility for work or materials claimed
to have been performed for or furnished to or on behalf of Tenant.
9.6 Title to Improvements. All improvements constructed by Tenant on
the Premises shall be Landlord's property.
9.7 Removal of Improvements. Landlord, by notice to Tenant, may require
Tenant to remove at Tenant's expense (1) at any time, any improvements made by
Tenant in the Premises and not included in Tenant's Improvements or consented to
by Landlord pursuant to this Article; (2) on termination of this Lease or
Tenant's right of possession, any improvements made by Landlord or Tenant whose
removal is necessary to permit releasing; and (3) in either case, to repair any
damage caused by installation or
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removal; provided, however, Tenant may remove only those items specified in
Landlord's notice and any items that are Tenant's property.
9.8 Survival of Obligations. Tenant's obligations under this Article
shall survive expiration or earlier termination of this Lease.
Article 10. ASSIGNMENT AND SUBLETTING
10.1 Notice to Landlord. Tenant may, with Landlord's prior consent, (a)
assign this Lease or any interest under it by voluntary act, operation of law or
otherwise; (b) sublet the Premises or any part of it; or (c) permit the use of
the Premises by any parties other than Tenant, its previously approved assignees
and subtenants and these parties' Users. Tenant shall notify Landlord of
Tenant's intent, as of a stated date (the "Transfer Date") at least 30 days
after notice, to assign this Lease or sublet part or all of the Premises for the
balance or part of the Term. Tenant's notice shall state the consideration for
and all other terms of the proposed assignment or sublease and the name and
address of the proposed assignee or subtenant and shall include a complete copy
of the proposed assignment or sublease.
10.2 Landlord's Consent. Landlord's consent to a proposed assignment or
subletting shall not be unreasonably withheld. If Landlord does not consent
within 10 business days after Tenant's notice, Landlord's consent shall be
deemed withheld.
10.3 Landlord's Expenses. Tenant shall promptly on demand pay
Landlord's reasonable attorneys' fees and other expenses incident to a review of
any documentation related to any proposed assignment or sublease. If this Lease
is terminated as to all or any part of the Premises pursuant to this Article,
Tenant shall at its expense discharge any commission due and owing as a result
of any proposed assignment or subletting, whether or not the applicable part of
the Premises is recaptured and rented by Landlord to the proposed occupant or
anyone else.
10.4 Deemed Assignments. An assignment within the meaning of this
Article shall be deemed to have occurred on a cumulative Change in Ownership
(defined below) of more than 50% of the equity interests in Tenant since the
date of this Lease or on a sale of all or substantially all of Tenant's assets,
regardless of whether such sale includes an assignment of Tenant's rights under
this Lease or a sublease of the Premises. "Change in Ownership" means (a) if
Tenant is a partnership (which term shall include joint ventures) or limited
liability company, any change in the partners or members of Tenant, or (b) if
Tenant is a corporation whose outstanding voting stock is not listed on a
recognized securities exchange, any transfer of the shares of stock of Tenant.
However, a Change in Ownership does not include changes in partners or members
or transfers of stock for estate planning purposes to a family member, a trust,
a family partnership, or any similar estate planning transfer.
10.5 No Release. Tenant and any and all guarantors of this Lease shall
remain fully liable under this Lease and their guaranties, respectively, despite
any sublease or assignment.
10.6 Documentation. Subtenants shall agree in a form reasonably
satisfactory to Landlord to comply with this Lease to the extent of the space
sublet. Tenant shall deliver to Landlord promptly an executed copy of each
sublease or assignment and an agreement of compliance by each subtenant.
Landlord's consent to any assignment or sublease shall not be a waiver of
Landlord's rights under this Article as to any subsequent assignment or
sublease.
10.7 Financing Statements. Tenant shall not enter into, execute, or
deliver any financing statement or security agreement that can be given priority
over any mortgagee given by Landlord or its successors.
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10.8 Effect of Noncompliance. Any sale, assignment, mortgage, transfer
or sublease of the Premises by Tenant not in compliance with this Article shall
be void.
Article 11. DAMAGE
11.1 Repairs. If damage to the Facility renders a material part of the
Premises unusable for Permitted Uses and the damage can be substantially
repaired within 120 days using standard working methods, then unless this Lease
is terminated pursuant to this Article, Landlord shall promptly and diligently
(and in any event no later than 120 days after the date of the damage) restore
the damaged areas (excluding any improvements not included in the Tenant
Improvements) to substantially the same condition that existed before the
damage. If the damage was not caused or contributed to by any act or omission of
Tenant or its Users, Rent shall be apportioned on a daily and square footage
basis and abated proportionately until repairs are completed. If Landlord does
not timely complete repairs, Tenant may terminate this Lease by notice to
Landlord within 30 days after the deadline for completion, unless repairs are
completed before notice of termination. However, Tenant may not terminate this
Lease if its willful misconduct caused the damage unless Landlord is not
promptly and diligently repairing the Facility.
11.2 Termination.
(a) Either party may terminate this Lease if damage to the
Facility renders a material part of the Premises unusable for Permitted Uses and
the damage cannot be substantially repaired within 120 days using standard
working methods.
(b) Landlord may also terminate this Lease, provided Landlord
also terminates all similarly affected leases in the Facility, if (1) more than
33% of the Facility is damaged and Landlord elects not to repair the damage; (2)
a mortgagee of the Facility does not allow adequate insurance proceeds to repair
damage to the Facility; (3) damage to the Facility is not covered by insurance
Landlord is required to maintain under this Lease; (4) Landlord in good xxxxx
xxxxxxx its insurance claims relative to the damage for less than the amount
required to make repairs; or (5) the Facility is damaged during the last 12
months of the Term.
(c) To terminate the Lease under this Section, a party must
notify the other party within 30 days after discovery of the event allowing
termination and before the damage is repaired, specifying a termination date at
least 30 but not more than 60 days after the notice date.
Article 12. EMINENT DOMAIN
12.1 Definition. "Taken" means acquisition by the power of eminent
domain or any similar governmental power or any other acquisition in lieu of
condemnation.
12.2 Termination.
(a) If the entire Premises, or portions of the Facility
sufficient to render the entire Premises unusable for Permitted Uses, are
permanently taken, this Lease shall terminate as of the date title vests in the
condemning authority or the date the Premises become unusable, whichever occurs
first.
(b) If any part of the Facility is permanently taken and
Landlord elects to restore the Facility in a manner that materially alters the
Premises, Landlord or Tenant may terminate this Lease. If sufficient portions of
the Facility are permanently taken so as to materially interfere with Tenant's
use of the Premises for Permitted Uses, Tenant may terminate this Lease. To
terminate the Lease under this Paragraph, a party must notify the other party
within 30 days after the date title
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vests in the condemning authority, specifying the termination date at least 30
but not more than 60 days after the notice date.
12.3 Damages. All damages awarded for any taking of the fee and
leasehold interests in the Facility shall belong to Landlord. Tenant may prove
in any proceedings and receive a separate award for any other condemnation
awards available under applicable law.
12.4 Restoration. If a partial taking of the Facility occurs and this
Lease is not terminated pursuant to this Article, Rent and Tenant's Percentage
shall be adjusted based on the remaining size, character, and value of the
Premises and the Facility and Landlord shall restore the Facility (excluding any
improvements in the Premises that are not included in the Tenant Improvements)
as nearly as reasonably possible to a complete architectural unit with all due
diligence, but only to the extent of available condemnation proceeds.
Article 13. MORTGAGEES AND PURCHASERS
13.1 Priority. Tenant's rights under this Lease are and shall always be
subordinate to any and all mortgages, deeds of trust, ground leases and other
security instruments (each a "Mortgage") now or in the future encumbering the
Facility or any part of it and to amendments, replacements, renewals and
extensions of Mortgages, provided that Tenant's use and occupancy of the
Premises shall not be disturbed by any mortgagee, trustee, ground lessor or
other secured party (each a "Mortgagee") under any Mortgage as long as no
uncured Event of Default (defined below) exists and the Lease is in full force.
This clause shall be selfoperative and no further instrument of subordination
shall be required, but Tenant shall execute such further assurance, containing
such reasonable provisions, as Landlord or any Mortgagee may request. Any
Mortgagee may elect that this Lease shall have priority over its Mortgage and on
notification of this election by a Mortgagee to Tenant, this Lease shall be
deemed to have such priority whether the Lease is dated before or after the date
of the Mortgage.
13.2 Estoppel Certificates. Tenant shall, from time to time on
Landlord's written request, execute, acknowledge and deliver to Landlord or its
designee a written certification stating: (a) the date this Lease was executed
and the date it expires; (b) the date Tenant entered into occupancy of the
Premises; (c) the amounts of each component of Rent and any Security Deposit and
the date to which each component of Rent has been paid; (d) that this Lease is
unmodified and in full force and effect (or if modified that the Lease as
modified is in full force and effect and stating the modifications); (e) that
Landlord is not in default under this Lease (or if in default the specific
nature of the default); and (f) other matters as may be reasonably requested by
Landlord or any Mortgagee or prospective purchaser of the Facility. Tenant shall
modify the foregoing certification to reflect accurately the status of this
Lease. Any prospective purchaser or Mortgagee may rely on any certification
delivered pursuant to this paragraph. If Tenant fails to respond within 10
business days after request by Landlord for a certification, Tenant shall be
conclusively deemed to have admitted the accuracy of any information Landlord
supplies to a prospective purchaser or Mortgagee to the effect that this Lease
is in full force and effect, that there are no uncured defaults in Landlord's
performance, that any Security Deposit is as stated in this Lease and that not
more than one month's Base Rent has been paid in advance, unless Landlord has
actual knowledge to the contrary.
13.3 Mortgagee's Right to Cure. Provided a Mortgagee notifies Tenant in
writing of its address, Tenant shall give the Mortgagee, by certified or
registered mail, a copy of any notice of default served on Landlord and agrees
that the Mortgagee may, but need not, cure any such defaults.
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13.4 Transfer of Landlord's Interest. If Landlord's interest in the
Facility or any part of it is transferred (other than transfers for security
purposes only, but including transfers via foreclosure), Landlord shall have no
responsibility for the Landlord's obligations accruing after the transfer, and
the transferee shall have no responsibility for Landlord's obligations accruing
before the date of transfer, including liability for any Security Deposit
(unless the transferee receives a credit from Landlord for any Security
Deposit). Tenant shall attorn in writing to the transferee, provided the
transferee assumes, in writing, the future Landlord's obligations under the
Lease.
Article 14. ADDITIONAL OBLIGATIONS OF LANDLORD
14.1 Compliance with Law, Etc. Landlord shall ensure that the Facility
complies with applicable laws, private restrictions and insurance requirements,
provided that if any noncompliance is caused by Tenant or its Users, Tenant
shall pay the cost of eliminating the noncompliance.
14.2 Services. Landlord shall provide the following services to Tenant:
(a) Air conditioning and heating service for comfortable
occupancy of the Premises.
(b) Electricity consistent with the electricity provided to
comparable properties used for purposes similar in nature to the Permitted Uses.
(c) Water for drinking, lavatory and toilet purposes from the
regular Building supply through existing fixtures (or fixtures installed by
Tenant with Landlord's prior consent) at temperatures in accordance with
applicable law.
(d) Maintenance of exterior plantings and removal of snow,
ice, debris and unsafe conditions from the exterior of the Facility and the
adjacent sidewalks.
(e) Sewer service for sewage emanating from plumbing fixtures
located in the Premises.
14.3 Tenant Improvements. Landlord shall complete the improvements
described on the attached Exhibit C ("Tenant Improvements") within 30 days after
the Commencement Date.
14.4 Construction of New Building. Landlord shall construct the New
Building in accordance with the Work Letter attached as Exhibit D.
Article 15. RIGHTS RESERVED TO LANDLORD
Landlord reserves the following rights exercisable without notice or
liability to Tenant and without effecting a constructive or actual eviction or
disturbance of Tenant's use or possession or giving rise to any claim for set
off or abatement of Rent:
15.1 Identification of Facility. Except as otherwise provided elsewhere
in this Lease, to change the name, address, number or designation by which the
Facility is commonly known.
15.2 Service Contractors. To reasonably restrict and control any
service in or to the Premises including, but not limited to, provision of sign
painting and lettering.
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15.3 Control of Facility. Provided Tenant's access to and use of the
Premises for Permitted Uses is not materially impaired, to reduce, increase,
enclose or otherwise change the size, number and location of buildings, layout
and nature of the Facility and the other tenancies, premises and buildings
included in the Facility, construct additional buildings and additions to any
building, increase the size of the Facility by adding parcels of land to it,
create additional rentable areas through use or enclosure of Common Areas or
otherwise, convey portions of the Facility and reduce the size or restrict
Tenant's use of the Common Areas.
Article 16. SURRENDER OF PREMISES
16.1 Condition of Premises.
(a) Tenant shall notify Landlord at least 30 days before
vacating the Premises to arrange for a joint inspection of the Premises. If
Tenant fails to give notice and arrange an inspection, Landlord's inspection
after Tenant vacates the Premises shall be conclusively deemed correct for
purposes of determining Tenant's responsibility for repairs to the Premises.
(b) On or before the Expiration Date or the date of earlier
termination of this Lease, Tenant shall, at its expense, remove all property
owned by or in the custody of Tenant from the Premises; all property not timely
removed shall be deemed abandoned at Landlord's option. Tenant appoints Landlord
its agent to remove its property from the Premises on termination of this Lease
and to cause transportation and storage of Tenant's property for Tenant's
benefit, all at Tenant's sole cost and risk, and Landlord shall not be liable
for any damage to or loss or theft of any of the property.
(c) On the Expiration Date or on earlier termination of this
Lease, Tenant shall peaceably surrender the Premises in good order, reasonable
wear and tear excepted, and in a condition consistent with Tenant's repair
obligations under this Lease, and shall surrender at the place then fixed for
payment of Rent all keys for the Premises and shall inform Landlord of
combinations of any vaults, locks and safes left at the Premises.
(d) Tenant shall reimburse Landlord on demand for any expenses
incurred by Landlord with respect to removal, transportation or storage of
abandoned property or with respect to restoring the Premises to the condition
required on surrender.
16.2 Holdover.
(a) If Tenant remains in possession of the Premises after
expiration or earlier termination of this Lease without the execution of a new
lease, but with Landlord's consent, Tenant shall be deemed to be occupying the
Premises from monthtomonth, subject to all the provisions of this Lease as
applicable to a monthtomonth tenancy, except that Landlord may adjust Base Rent
according to Landlord's then current rental rate schedule for new tenants in the
Facility.
(b) If Tenant remains in possession of the Premises after
expiration or earlier termination of this Lease without the execution of a new
lease and without Landlord's consent, Tenant shall be deemed to be occupying the
Premises without claim of right and Tenant shall pay Landlord for all costs or
liability resulting from delay in surrendering the Premises (including, without
limitation, claims made by any succeeding tenants and reasonable attorneys' fees
in connection with those claims) and in addition shall pay for each day of
occupancy an amount equal to double the daily rate of Rent immediately preceding
the holdover.
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Article 17. DEFAULT AND REMEDIES
17.1 Default By Tenant.
(a) Each of the following events is an "Event of Default":
(1) Tenant fails to pay to Landlord any payments
due under this Lease when due and nonpayment
continues for 10 business days after notice
from Landlord.
(2) Tenant fails to perform any of Tenant's
other obligations under this Lease and
nonperformance continues for 30 days after
notice from Landlord, provided that if the
nonperformance cannot be cured within 30
days, the cure period shall be extended for
as long as reasonably necessary as long as
Tenant is diligently pursuing cure.
(3) This Lease or any of Tenant's rights under
it is levied on under any attachment or
execution and the attachment or execution is
not vacated within 30 days.
(4) Tenant or any guarantor of this Lease dies,
is dissolved or becomes the subject of a
petition in bankruptcy or insolvency or for
liquidation, reorganization or involuntary
dissolution or for the appointment of a
receiver or trustee of all or any of its
property (which such petition or appointment
is not dismissed or vacated within thirty
(30) days) or makes an assignment for the
benefit of its creditors or petitions for or
enters into an arrangement with its
creditors.
(5) Tenant vacates or abandons the Premises for
30 consecutive days.
(b) If an event occurs that, with the giving of notice and the
passage of time, would be an Event of Default, Landlord may, without notice and
in addition to all other rights and remedies available to Landlord by law or
other provision of this Lease, exercise any or all of the following remedies:
(1) If any Rent is not paid on time, charge
Tenant 5% of the amount of the overdue
payment as liquidated damages for Landlord's
extra expense in handling the past due
account.
(2) If any other obligation is not performed on
time, without waiving or releasing Tenant
from any obligations, perform the obligation
for the account and at the expense of
Tenant.
(3) Restrain by injunction the attempted or
threatened violation of this Lease.
(c) If an Event of Default occurs, Landlord may, in addition
to all other rights and remedies available to Landlord by law or other provision
of this Lease, exercise any or all of the following remedies:
(1) Take any of the actions specified in
paragraph (b) above, to the extent not
already taken.
(2) Restrain by injunction the violation of this
Lease.
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(3) Without legal process or notice to Tenant
(except to the extent required by applicable
law), immediately reenter the Premises, and
remove all persons and property.
(4) Subject to Landlord's obligation, if any, to
mitigate its damages under applicable law,
terminate this Lease and recover from Tenant
all unpaid Rent, with interest at the rate
set forth below; and the present value of
the excess (if any) of the Rent for the rest
of the Term over the fair market rental
value of the Premises for the rest of the
Term, discounted at 2.0% below the publicly
announced prime rate of interest at
Landlord's then current depository
institution.
(d) Tenant waives any and all rights of redemption or
reinstatement granted by law if Tenant is declared in default and given notice
of termination or evicted or dispossessed for any cause or if Landlord obtains
possession of the Premises by reason of Tenant's violation of this Lease or
otherwise.
(e) Subject to Landlord's obligation, if any, to mitigate its
damages under applicable law, Tenant shall indemnify Landlord against all
damages Landlord may incur by reason of termination of this Lease including, but
not limited to, loss or diminution of rents; reasonable costs of recovering,
restoring, and repairing the Premises; and reasonable costs of renting the
Premises to another tenant (including brokers' commissions, reasonable
attorneys' fees, and necessary rent concessions).
17.2 Default by Landlord.
(a) If Landlord fails to perform any of Landlord's obligations
under this Lease and nonperformance continues for 30 days after notice from
Tenant, Landlord shall be in default, and Tenant may (but shall not be required)
to cure the default. If Tenant exercises this right, Landlord shall reimburse
Tenant on demand for reasonable costs incurred by Tenant in curing the default.
This right shall be in addition to any other right or remedy Tenant has by law,
except the right to terminate this Lease, which Tenant waives.
(b) Anything in this Lease to the contrary notwithstanding,
Landlord's obligations, representations and warranties in this Lease are not
personal obligations, representations and warranties or binding on any of
Landlord's assets except Landlord's interest in the Facility, as it may from
time to time be encumbered. No personal liability arising from this Lease or
Landlord's obligations under it shall be asserted or enforceable against
Landlord or its partners, coventurers, shareholders, directors or officers or
their respective heirs, legal representatives, successors or assigns.
17.3 Interest. Any amounts owing from one party to the other under this
Lease and not paid within any applicable grace period after the date due shall
bear interest from the date due until paid at the lesser of (a) 4% over the
publicly announced prime rate of interest at Landlord's then current depository
institution, if different), adjusted from time to time as this prime rate
changes or (b) the highest rate of interest permitted in the state where the
Facility is located for similar obligations.
17.4 Attorneys' Fees. In any litigation or alternative dispute
resolution brought by reason of an alleged default under this Lease, the losing
party shall pay court (or alternative forum) costs and all the other party's
expenses, including reasonable attorneys' fees (including allocated costs of
in-house attorneys, if any).
17.5 Forbearance. A party's failure to insist on the strict performance
of any of the other's obligations under this Lease, or to exercise any option
under this Lease, shall not be deemed to be a waiver of the obligation or
option, regardless, with
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respect to Landlord, of Landlord's knowledge of the preceding breach at the time
of acceptance of Rent.
17.6 Waiver of Jury Trial and Counterclaims. The parties waive trial by
jury in any action, proceeding or counterclaim brought by either of them against
the other (except for personal injury or property damage) on all matters
connected with this Lease, their relationship as landlord and tenant, Tenant's
use or occupancy of the Premises and any statutory or other remedy. Tenant shall
not interpose any noncompulsory counterclaims in a summary proceeding or other
action based on termination or holdover.
17.7 No Accord and Satisfaction. No payment or receipt by either party
of a lesser amount than the monetary obligations due under this Lease shall be
deemed to be other than on account of the earliest obligations due, nor shall
any endorsement or statement on any check or any letter accompanying any check
or payment be deemed an accord and satisfaction, and either party may accept any
check or payment without prejudice to its right to recover the balance of the
obligations or pursue any other remedy. No receipt for money from any person
after termination of this Lease, service of any notice, commencement of any suit
or final judgment for possession of the Premises shall reinstate, continue or
extend the Term or affect any such notice, demand or suit or imply consent for
any action for which a party's consent is required, unless specifically agreed
by that party in writing. Any amounts received by either party may be allocated
to any specific amounts due from the other as the recipient determines.
Article 18. TENANT'S OPTION TO PURCHASE AND RIGHTS OF FIRST REFUSAL
18.1 Option to Purchase. Commencing on April 1, 2005 and upon providing
Landlord written notice, Tenant shall have the following options to purchase:
(a) Tenant shall have the option to purchase the real estate
and buildings described and depicted on Exhibit E and Exhibit E-1 as the
"Partial Option Area" (which includes the New Building and the approximately 2
most northern acres of the Additional Parcel) at a purchase price equal to the
average net operating income for the Partial Option Area over the term of the
Lease divided by a capitalization rate of 10.75%; or
(b) Tenant shall have the option to purchase the entire
Facility (including the New Building and the Additional Parcel) at a purchase
price equal to the average net operating income for the entire Facility over the
term of the Lease divided by a capitalization rate of 10.00%.
18.2 Right of First Refusal to Lease. Upon completion and delivery to
Tenant of the New Building and/or Tenant's surrender of the Temporary Space, and
except during the last year of the Term, as may be extended from time to time,
provided Tenant is not in default and this Lease is in full force, whenever
Landlord receives a bona fide offer to lease the Temporary Space, Landlord shall
offer to lease the Temporary Space to Tenant at the rental rate contained in the
bona fide offer to lease and otherwise on the terms and conditions of this
Lease. Tenant shall have 10 business days from receipt of Landlord's notice
(which shall contain a copy of the bona fide offer to lease) within which to
notify Landlord of its acceptance of the offer to lease.
18.3 Other Terms and Conditions.
(a) Landlord shall convey the Partial Option Area and/or the
Facility including the Additional Parcel, as applicable, by Warranty Deed,
excepting from the warranty of title only municipal and zoning ordinances and
agreements entered under them, recorded easements for the distribution of
utilities and municipal services, recorded building and use restrictions and
covenants, general taxes levied in the year
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of closing, installments of special assessments due after the date of closing,
rights of parties in possession of any part of the applicable real estate,
matters that would be disclosed by a survey of the Facility and matters that are
Tenant's responsibility under this Lease ("Permitted Encumbrances").
(b) Except for compliance with Landlord's maintenance and
repair obligations under this Lease (if any), Landlord shall be deemed to have
made no warranties or representations with respect to the physical condition of
the Partial Option Area and/or the Facility, as applicable, in connection with
the conveyance. Tenant shall have 45 days from the date Tenant exercises its
option to purchase the Facility pursuant to Subsection 18.1(b) to conduct such
physical inspections of that portion of the Facility not leased by Tenant to
evaluate the physical condition of such applicable real estate and improvements.
Landlord shall provide reasonable access or obtain necessary permissions for
reasonable access by Tenant to the Facility for purposes of inspection. Except
for claims relating to or arising out of Landlord's failure to provide required
access, Tenant shall indemnify and hold Landlord harmless from and against any
and all claims, demands, liabilities, damages, costs of expenses (including,
without limitation, reasonable attorneys' fees) arising out of or relating to
Tenant's inspection of the Facility pursuant to this Subsection 18.3(b). Tenant
may, within such 45 day period, terminate its obligation to purchase the
Facility by providing Landlord with written notice of its objection to the
physical condition of the applicable portion of the Facility. Tenant
acknowledges that Landlord would not have agreed to the purchase price set forth
above except in connection with an "as is" sale, and that its rights under this
Lease shall provide sufficient opportunity to examine the physical condition of
the Premises.
(c) Closing of the conveyance of the Option Area and/or the
Facility shall occur no earlier than 180 days or later than 270 days after
Tenant notifies Landlord of its intention to exercise its option or accept the
offer, whichever is applicable. In addition to the Warranty Deed described
above, Landlord shall execute any and all documents necessary to record the Deed
and such documents as may be necessary to cause Tenant's title insurance company
to insure against matters that are not Permitted Encumbrances, including matters
covered by "gap" title insurance. To the extent they do not accrue to Tenant
under this Lease, all income and expenses in connection with the applicable real
estate and improvements shall be prorated as of the closing date. Landlord shall
pay the real estate transfer fee on the conveyance, any and all obligations
resulting in encumbrances on title that are not Permitted Encumbrances, all
title insurance charges and the recording and filing fees for instruments
eliminating any and all such encumbrances. Except as otherwise may be agreed,
Tenant shall pay the recording fees for the Deed and all costs of any other due
diligence performed by Tenant (including the costs of any survey, inspection, or
environmental assessment).
Article 19. MISCELLANEOUS PROVISIONS
19.1 No Reservation. Submission of this Lease for examination does not
constitute a reservation or option to lease the Premises. This Lease becomes
effective as a lease only on execution and delivery by Landlord and Tenant.
Landlord's employees and agents have no authority to make or agree to make a
lease or other agreement.
19.2 Persons Bound. This Lease binds and benefits Landlord and Tenant
and their successors and assigns. If multiple parties execute this Lease as
Tenant, their liability shall be joint and several.
19.3 Interpretation.
(a) This Lease shall be interpreted according to and governed
by the internal laws of the state in which the Facility is located.
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(b) Captions to the Articles and Sections of this Lease are
not a part of the Lease and shall have no effect on the interpretation of any
part of it.
(c) The relationship of Landlord and Tenant created by this
Lease shall not constitute or be construed as a partnership, principalagent
relationship, joint venture or other cooperative enterprise.
(d) If any provision of this Lease is proven to be illegal or
unenforceable, it shall be deemed modified to the minimum extent and for the
minimum amount of time necessary to eliminate the illegality or
unenforceability. If the intent of any provision of this Lease specifically
indicates, the parties' respective obligations under such provision shall
survive expiration or earlier termination of the Lease.
(e) This Lease contains all agreements between Landlord and
Tenant relating to its subject matter. Any and all prior agreements or
understandings are superseded. Each party acknowledges that neither the other
party nor its agents have made any promises or representations in connection
with this Lease except as set forth in this Lease and agrees that no claim or
liability shall be asserted for, and neither party shall be liable for, breach
of any promise or representation not stated in this Lease.
19.4 Managing Agent. Landlord's rights and remedies under this Lease or
provided by law may be executed in Landlord's own name or in the name of its
managing agent (if any) and all legal proceedings for the enforcement of rights
or remedies may be commenced and prosecuted to final judgment and execution in
Landlord's own name or in the name of its managing agent.
19.5 Dates; Force Majeure.
(a) Whenever this Lease requires payment of money on demand or
without specifying a deadline, payment shall be required by the next date an
installment of Rent is due or within 10 business days, whichever is later.
(b) Whenever this Lease requires performance of an obligation
other than payment of money on demand or without specifying a deadline,
performance shall be required within 30 days, or within a reasonable time if
such performance cannot be accomplished within 30 days.
(c) Except where otherwise indicated, time is of the essence
of this Lease. However, if weather conditions, natural disaster, fire, war,
civil unrest, labor unrest, or similar circumstances beyond a party's reasonable
control prevent timely performance of an obligation other than payment of money,
the time for performance shall be extended by the amount of time performance is
prevented.
19.6 Authority. Each party warrants that it has the power and authority
to enter into this Lease, and shall furnish to the other on reasonable demand
evidence of this power and authority.
19.7 Memorandum. Either party shall, at the request of the other,
execute a recordable memorandum of this Lease, to be prepared and recorded at
the expense of the requesting party.
19.8 Brokers. Each party warrants that it has not engaged any broker,
finder or other person (except as previously disclosed in writing, if any) who
would be entitled to any commission or fees in respect of the negotiation,
execution or delivery of this Lease. Each party shall be solely responsible for
compensating its own broker (if any), and shall defend and indemnify the other
against any claims, expenses or
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liabilities incurred by the other as a result of any brokerage arrangements or
agreements made or alleged to have been made by or on behalf of the indemnifying
party.
19.9 Early Termination; Amendment. Whenever any provision of this Lease
terminates the Lease before the Expiration Date, or changes any other provision
of the Lease, the termination or change shall promptly be confirmed by written
agreement between Landlord and Tenant. However, until the parties execute such
an agreement, the Lease shall nevertheless be deemed terminated or amended.
Otherwise, this Lease may not be modified except in writing signed by Landlord
and Tenant, and by an mortgagee of the Facility if the mortgagee so requires.
19.10 Notices and Consents. All notices and consents required or
permitted under this Lease must be in writing served either personally, by
registered or certified mail, postage prepaid, or by overnight courier service,
and shall be deemed given when personally delivered, postmarked or given to the
courier service. The parties' respective addresses for notices, consents, and
payments are set forth in the Data Sheet. Either party may change its address
for notices, consents and payments at any time by notice to the other.
19.11 Exhibits. The following Exhibits are attached to and by reference
incorporated in this Lease:
(a) Exhibit A: Legal Description of Land
Exhibit A-1: Depiction of 10.5 Acre Parcel
Exhibit A-2: Depiction of Additional Parcel
(b) Exhibit B: Site Plan of Premises
Exhibit B-1: New Building Location
(c) Exhibit C: Description of Tenant Improvements
(d) Exhibit D: Work Letter for New Building
(e) Exhibit E: Description of Partial Option Area
(f) Exhibit F: Rent Schedule
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LANDLORD: TENANT:
PARK STREET INDUSTRIAL LLC TRAK INTERNATIONAL, INC. d/b/a SKY TRAK
INTERNATIONAL
By: Xxxx Xxxxx Real Estate Corp., By: /s/ Xxxxxx X. Xxxxx
Manager ----------------------------------
Xxxxxx X. Xxxxx
Vice President and Secretary
By: /s/ Xxxx Xxxxx
-------------------------- Attest: /s/ Xxxxxxxx Xxxxxx
Xxxx X. Xxxxx, President --------------------------
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