Exhibit 10.16
LEASE
(000 Xxxxxxx Xxxxxxx, Xxx Xxxxxxx, Xxx Xxxx)
Between
LIZZIE REALTY, LLC
Landlord
and
The RAL Supply Group, Inc.
Tenant
--------------------------
LEASE
(389 Windsor Highway, New Windsor, New York)
This is a Lease made as of the 1st day of May, 1998 and effective as of said
date, between
LIZZIE REALTY, LLC
XX Xxx 000
Xxxxxxxxxx, Xxx Xxxx 00000
("Landlord")
and
The RAL Supply Group, Inc.,
a New York corporation
having an address at
00 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxx Xxxx 00000
("Tenant")
WITNESSETH:
RECITALS:
A. Landlord is the owner of property commonly known as 000 Xxxxxxx
Xxxxxxx, Xxx Xxxxxxx, Xxx Xxxx, 00000, which has an upper level of approximately
11,000 square feet and a lower level of approximately 11,000 square feet.
B. Landlord desires to lease a portion of the upper level of said
property to Tenant and Tenant desires to lease the same form Landlord.
NOW, THEREFORE, in consideration of the respective promises of the parties
contained herein, it is agreed as follows:
ARTICLE I
---------
GENERAL
-------
1.1 Leased Premises
---------------
Landlord hereby leases to Tenant the premises more particularly
described on Schedule "A" annexed hereto and made a part hereof (hereinafter
sometimes called "Leased Premises").
1.2 Initial Term of Lease
---------------------
The "Initial Term" of this Lease shall be for a period commencing
on May 1,1998 (the "Commencement Date") and terminating on April 30, 2008.
1.3 Renewal Terms
-------------
(a) Tenant shall have the option to extend the term of this
Lease for two (2) periods of five (5) years each, on the same terms and
conditions (except for Annual Fixed Rental, which shall be subject to adjustment
as provided on Schedule "B" annexed hereto) as herein contained.
(b) Tenant may exercise each of the five (5) year option
periods by giving written notice to Landlord not less than none (9) months prior
to the expiration date of the Initial Term or the First Renewal Term, as the
case may be.
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1.4 Condition of Leased Premises at
-------------------------------
Termination of Lease
--------------------
Tenant shall surrender the Leased Premises at the termination of
this Lease, broom clean and in as good condition as ordinary wear and reasonable
use will permit, except for damages caused by fire or other casualty, except as
otherwise provided herein. Tenant's obligation to observe and perform this
covenant shall survive the termination of this Lease.
1.5 Covenant to Pay Rent
--------------------
Tenant shall pay to Landlord the Annual Fixed Rental as set forth
on Schedule "B" annexed hereto, in equal monthly installments, in advance,
without setoff or defense, on the first day of each and every calendar month,
beginning June 5, 1996, until the expiration of the term of this Lease and any
Renewal Term.
ARTICLE II
----------
POSSESSION AND TITLE
--------------------
2.1 Warranties as to Title, etc.
----------------------------
Landlord represents, warrants, covenants and agrees
that it is possessed of the fee simple title to the Leased Premises.
2.2 Quiet Enjoyment
---------------
Landlord covenants and assures Tenant of quiet and
peaceful possession and enjoyment of the Leased Premises against all persons
whomsoever, but this covenant shall not limit the scope of any covenant of quiet
enjoyment implied or otherwise prescribed by law.
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2.3 Possession
----------
Possession of the Leased Premises shall be delivered to
the Tenant on the Commencement Date.
ARTICLE III
-----------
TAXES AND ASSESSMENTS
---------------------
3.1 Tenant's General Undertakings
-----------------------------
(a) In addition to the Annual Fixed Rental to be paid
by Tenant to Landlord set forth herein, and as a further part of the
consideration to be furnished by the Tenant, and as additional rental for the
term demised, the Tenant covenants and agrees with the Landlord that the Tenant
will, during the term of this Lease and any Renewal Term, promptly pay when due,
all real estate taxes and sales and use taxes or similar taxes in the nature of
occupancy taxes (but not any taxes based on income payable by Landlord unless
such tax is imposed in substitution or in lieu of any governmental charge set
forth in this section), together with all charges and assessments, whether
special or general, for public improvements imposed subsequent to the
Commencement Date, and other impositions and liens for public improvements,
including all taxes which are assessed by any city, town, county, Federal,
special drainage, school or other taxing agencies, authorities or districts or
otherwise, together with any interest, penalties or other charges which may
accrue thereon, and allocated to the term hereof or any Renewal Term, provided
that in the event any of said taxes or assessments are payable, according to the
terms of their imposition, in installments, then Tenant shall have the right to
pay the same as
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such installments fall due. Tenant shall provide Landlord with receipted bills
or other evidence of payment, satisfactory to Landlord, of all taxes within
twenty (20) days of the due date thereof.
(b) Tenant covenants and agrees that it will pay all
such taxes and assessments for the last full calendar year of this Lease, and
will pay to Landlord, upon termination of this Lease, its prorated share of the
taxes for the year in which this Lease is ended and the property is returned to
Landlord, provided that all such impositions shall be paid in full by Tenant
prior to its surrender of the Leased Premises to Landlord.
3.2 Landlord's Right to Cure Tenant's Default
-----------------------------------------
In case Tenant shall fail, refuse or neglect to make any
of the payments in and by this Article III required, then Landlord may, at
Landlord's option, on prior notice to Tenant and without its constituting a
waiver of the default thus occurring in this Lease, pay the same; and the amount
or amounts of money so paid, including reasonable attorneys' fees and expenses
which might have been reasonably incurred because of or in connection with such
payment, together with the interest on all such amounts at the rate equal to the
prime rate of Bankers Trust Company publicly announced in New York, New York,
and in effect from time to time, shall and will be paid by the Tenant to the
Landlord, upon demand by Landlord, and the payment thereof may be collected or
enforced by Landlord in the same manner as though said amount were an
installment of rent specifically required by the terms of this Lease to be paid
by the Tenant to the Landlord upon the day when Landlord demands the repayment
thereof or the reimbursement thereof, of and from Tenant.
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3.3 Right to Contest
----------------
(a) Nothing herein shall be construed to prevent
Tenant from contesting any tax, levy or assessment imposed against the Leased
Premises during the term of this Lease provided Tenant shall first pay the
imposition prior to its delinquency, or shall post a bond as authorized,
directed and approved by a court of competent jurisdiction in the amount of the
imposition or as otherwise ordered by the court, conditioned upon payment of the
tax and costs in the event Tenant should be unsuccessful in its contest, or
provided Tenant shall pay to the proper agency or a court of competent
jurisdiction, under proper court order, a sum of money equal to the amount under
contest or as otherwise ordered by the court, conditioned upon payment of the
tax and costs in the event Tenant should be unsuccessful in its contest or
otherwise conditioned as may be directed by the court.
(b) Nothing herein shall be construed to allow execution on
the Leased Premises by any governmental authority, even though the above
procedures, or any of them, are followed.
(c) Landlord shall, on Tenant's request, cooperate with
Tenant in the event Tenant seeks to contest any tax, levy or assessment; and
Tenant shall indemnify Landlord for any cost or expense she incurs in connection
therewith.
(d) If a refund is obtained which relates to a tax year which
is apportioned between Landlord and Tenant, the refund, net of legal fees and
expenses, including experts' fees, shall be apportioned between Landlord and
Tenant.
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ARTICLE IV
----------
ZONING AND OTHER RESTRICTIONS
-----------------------------
Tenant accepts the Leased Premises subject to such zoning
ordinances, subdivision restrictions, if any, and such other statutes, Federal,
state, county, municipal or otherwise, which may in any way affect the Leased
Premises.
ARTICLE V
---------
TENANT TO CARRY LIABILITY INSURANCE
-----------------------------------
5.1 Coverage
--------
Tenant will provide or cause to be provided policies of
insurance generally known as public liability policies and/or owner's, Landlord
and Landlord's mortgagee if required by the terms of any present or future
mortgagee of Landlord's interest in the Leased Premises, and Tenant policies,
insuring the Tenant and Landlord against all claims and demands made by any
person or persons whomsoever for injuries received in connection with the use,
operation and maintenance of the Leased Premises to the extent of not less than
One Million ($1,000,000) Dollars to cover the claim or damage from any single or
specific cause, by any one person, and to the extent of not less than Two
Million ($2,000,000) Dollars to cover in connection with any one particular
accident or occurrence, the total aggregate of any claims that may arise or be
claimed to have arisen against the Landlord as aforesaid. All such policies
shall name Landlord and any mortgagee of Landlord as an additional insured.
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5.2 Policies of Certificates
------------------------
Whenever, under the provisions of this Lease, policies of
insurance are required to be issued or maintained by Tenant, Tenant shall
promptly cause either the original of such policies or certificates thereof to
be delivered to Landlord as evidence of the compliance by Tenant with the terms
and conditions of this Lease, except where the terms of any mortgage require
that said policies be held by the mortgagee, in which case Tenant shall furnish
Landlord with a conformed copy of the policies. Tenant shall deliver to Landlord
evidence of the insurance coverage required to be maintained by Tenant upon
execution of this Lease.
5.3 Proof of Renewal
----------------
(a) Tenant shall also, within fifteen (15) days of
the expiration of any policy of insurance required hereunder, furnish proof of
renewal or replacement of such insurance.
(b) If Tenant fails timely to pay the premiums for
any policy of insurance required under the provisions of this Lease, then
Landlord may pay such premiums, and the amounts so paid by Landlord, plus
interest at the rate equal to the prime rate of Bankers Trust Company publicly
announced in New York, New York, and in effect from time to time, plus two
percentage points, shall be added to the installment of Annual Fixed Rent
becoming due on the first of the next succeeding month and shall be collected by
Landlord as Additional Rent hereunder.
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ARTICLE VI
FIRE, WINDSTORM AND CASUALTY
----------------------------
PROVISIONS; RELATED INSURANCE
-----------------------------
6.1 Coverage
--------
Tenant shall, at Tenant's sole expense and at all times
during the term of this Lease, insure or cause to be insured , any and all
buildings or improvements that exist or may be built or placed upon the Leased
Premises during the term of this Lease with good and responsible insurance
companies (rated AAA by Best's Rating) authorized to do business in the State in
which the Leased Premises are located, and approved by Landlord, which approval
shall not be unreasonably withheld, for protection against all loss or damage by
fire or windstorm and other casualty with extended coverage endorsement (as well
as vandalism and malicious mischief endorsement), to the extent of 100% of the
replacement costs, exclusive of foundations and footings, so as to avoid
co-insurance in case of a partial loss; and all policies issued and renewals
thereof shall be payable, in the event of loss, to Landlord and Tenant as their
interests may appear.
6.2 Use of Proceeds; Major Casualty
-------------------------------
If, at any time during the term of this Lease, (I) the
Leased Premises or any part thereof shall be damaged by fire or other casualty
(including any casualty for which insurance coverage was not obtained or
obtainable) or any kind or nature, ordinary or extraordinary, foreseen or
unforeseen, Tenant shall promptly notify Landlord, and (ii) the cost of
repairing such damage shall exceed Two Hundred Fifty Thousand ($250,000)
Dollars, in the
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aggregate, to be determined by Landlord's engineers reasonably acceptable to
Tenant, per occurrence, then Tenant may terminate this Leased Premises by notice
given to the Landlord within thirty-five (35) days of the date of the fire or
other casualty (the "Cancellation Notice"), the time of giving such notice to be
thirty (30) days following the day on which the Cancellation Notice is given
(the "Cancellation Date"). In the event of a cancellation pursuant to this
Paragraph 6.2, then (and not necessarily in the following order):
(a) All insurance money paid or to be paid on account
of such damage or destruction under the policies of insurance provided for in
Paragraph 6.1 shall be disbursed to Landlord. In such event, Tenant or such
other party not entitled to such insurance money shall, upon presentation of any
check constituting payment of such insurance money, in whole or in part, endorse
such check over to Landlord;
(b) Prior to Cancellation Date, Tenant shall remove
from the Leased Premises its personal property and such fixtures as are deemed
Tenant's property under Paragraph 22.3 hereof, and any such personal property or
fixtures remaining after the Cancellation Date may be disposed of, at Tenant's
expense, by Landlord as Landlord sees fit;
(c) Effective as of the Cancellation Date; this Lease
shall be deemed terminated and neither party shall have any rights as against
the other except those intended to survive termination; and
(d) Tenant shall immediately pay Landlord any
unpaid Annual Fixed Rental (or part thereof), Additional Rent and any and all
other obligations owed by Tenant to Landlord to the Cancellation Date.
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In the event that Tenant does not timely exercise its right to cancel this Lease
in accordance with this Paragraph 6.2, then the terms and provisions of
Paragraph 6.3 shall control.
6.3 Use of Proceeds; Minor Casualty
-------------------------------
(a) If, at any time during the term of this Lease,(I)
the Leased Premises or any part thereof shall be damaged or destroyed by fire or
other casualty (including any casualty for which insurance coverage was not
obtained or obtainable) of any kind of nature, ordinary or extraordinary,
foreseen or unforeseen, and (ii) no Cancellation Notice is sent pursuant to
Paragraph 6.2 above, or the cost of repairing such damage shall not exceed Two
--
Hundred Fifty Thousand ($250,000) Dollars, in the aggregate, per occurrence, the
Rent shall not xxxxx and Tenant, at its sole cost and expense, and whether or
not the insurance proceeds, if any, shall be sufficient for the purpose, shall
proceed with reasonable diligence (subject to a reasonable time allowance for
the purpose of adjusting the insurance loss and for unavoidable delay) to
repair, alter, restore, replace or rebuild the same or construct a replacement
building or replacement buildings, as the case may be, to at least the value,
condition and character of the building immediately prior to such damage or
destruction, subject to such changes or alterations as Tenant may elect to make
in conformity with the provisions of Article XXII. Such repair, alteration,
restoration, replacement, rebuilding or construction, including such changes and
alterations as aforementioned and including temporary repairs or the protection
of other property pending the completion of any thereof, are sometimes referred
to in this Article VI as the "Work".
(b) Except as otherwise provided in this Article VI,
the conditions under which any Work is to be performed, and the method of
proceeding with and performing the same shall be governed by all of the
provisions of Article XXII.
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(c) All insurance money paid on account of such
damage or destruction under the policies of insurance provided for in Paragraph
6.1, less the reasonable cost, if any, incurred in connection with the
adjustment of the loss and the collection thereof (herein sometimes referred to
as the "insurance proceeds"), shall be disbursed to a savings bank or other
financial institution designated by Landlord and reasonably acceptable to Tenant
(the cost and expense of which shall be borne equally by Landlord and Tenant) as
trustee for the benefit of Landlord; provided, however, that in the event that
-------- -------
Landlord refinances the Leased Premised or any portion thereof, and to the
extent required by the mortgagee providing such refinancing, the insurance
proceeds shall be disbursed to such mortgagee. For the purposes hereof, such
savings bank, other financial institution or such mortgagee, in its capacity as
trustee of the insurance proceeds, shall be deemed the "Insurance Trustee". The
insurance proceeds shall be applied by the Insurance Trustee only to the payment
of the cost of the Work to the extent such insurance proceeds shall be
sufficient for that purpose, and shall be paid out for the account of Tenant
from time to time as such Work progresses. The Insurance Trustee shall make such
payments or disbursements upon the written request by Tenant and, in any case,
only upon receipt of each of the following, which shall be performed at Tenant's
sole cost and expense (copies of which shall also be forthwith sent to
Landlord):
(I) a certificate dated not more than fifteen
(15) days prior to the date of any advance, signed by an
architect in charge of the Work who shall be selected by
Tenant and approved in writing by Landlord, which
approval shall not be unreasonably withheld, setting
forth that:
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(x) the sum then requested has been paid by
Tenant to contractors, subcontractors, materialmen,
architects or other persons who have rendered services
or furnished materials in connection with the Work,
giving a brief description of the services and
materials and the several amounts so paid or due and
stating that no part thereof has been made the basis in
any previous or then pending request or has been paid
out of any proceeds of insurance received by Tenant and
that the sum requested does not exceed the amount of
the services and materials described in the
certificate; and
(y) except for the amount stated in such
certificate to be due as aforesaid, there is no
outstanding indebtedness, known to the persons signing
such certificate after due inquiry, which might become
the basis of a vendor's, mechanic's or materialman's or
similar lien upon such Work, the Leased Premises or
Tenant's leasehold interest, or any part thereof; and
(z) the cost, as estimated by the persons
signing such certificate, of the Work required to be
done subsequent to the date of such certificate in
order to complete the same, does not exceed the amount
of
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insurance proceeds remaining in the hands of the
Insurance Trustee after the payment of the sum so
requested; and
(ii) a certificate dated not more than fifteen (15)
days prior to the date of an advance, of a reputable title
insurance company licensed to do business in the State where the
Leased Premises are located, covering the period from the
Commencement Date (or the date of the last such certificate
furnished pursuant to any of the applicable provisions of this
Lease) to the date of such certificate, setting forth that there
are no liens, chattel mortgages, conditional bills of sale, title
retention documents, or encumbrances or record or any kind on the
Leased Premises except those permitted by the terms of this Lease
and except such as will be discharged by payment of the amount
then requested; and
(iii) if exterior walls have been repaired or erected,
a perimeter survey {or an update of a perimeter survey previously
furnished under this subparagraph 6.3 (c) (iii)} showing no
encroachments upon any real property not constituting part of the
Leased Premises, except that any encroachment existing before a
restoration which Landlord permitted may be continued or
restored.
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(d) Upon compliance with the foregoing provisions of
this subparagraph 6.3 (d), the Insurance Trustee, out of such insurance
proceeds, shall pay or cause to be paid to the persons named in the certificate,
the respective amounts stated therein to have been paid by Tenant or to be due
to them, as the case may be.
(e) Upon receipt by the Insurance Trustee of
evidence, satisfactory to it, of the character required by subparagraph 6.3 (c)
(I), (ii) and (iii), that the Work has been completed and paid for in full and
that there are no liens of the character referred to therein, the Insurance
Trustee shall pay to Landlord any remaining balance of said insurance proceeds.
(f) If the insurance proceeds received by the
Insurance Trustee shall be insufficient to pay the entire cost of the Work as
reasonably estimated by Tenant's architects, Tenant shall contribute the amount
of any such deficiency to the Insurance Trustee who shall first apply the same
to the payment of the cost of the Work before disbursing the insurance proceeds
held by it. Under no circumstances shall Landlord be obligated to make any
payment, disbursement or contribution towards the cost of the Work.
(g) Upon a breach by Tenant of any of the provisions
under subparagraph 6.3 (c) (I), (ii) and (iii) hereof, in addition to all other
rights and remedies Landlord may have under this Lease, Landlord may, but shall
not be required to take possession of the Leased Premises and continue the Work,
at which time the Insurance Trustee shall be authorized to disburse the
remaining insurance proceeds then being held by it directly to Landlord.
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6.4 No Abatement of Rent
--------------------
In no event shall Tenant be entitled to any abatement,
allowance, reduction or suspension of Fixed Annual Rental, Additional Rental and
other charges because part or all of the Leased Premises shall be untenantable
owing to the partial or total destruction thereof or any reason whatsoever, and
no such damage or destruction shall affect in any way the obligation of Tenant
to pay the Annual Fixed Rental, Additional Rent and other charges herein
reserved or required to be paid, nor release Tenant of or from any obligation
imposed upon Tenant under this Lease.
6.5 Waiver of Subrogation
---------------------
(a) Each party hereby releases the other from any and
all liability, responsibility (to the other or anyone claiming through or under
it by way of subrogation or otherwise) under fire and extended coverage or
supplementary contract casualties, if such fire or other casualty shall have
been caused by the fault or negligence of the releasing party; provided,
--------
however, that this release shall be applicable and in full force and effect only
with respect to loss or damage which occurred during such time as the releasing
party's policies shall contain a clause or endorsement to the effect that any
such release shall not adversely affect or impair such policies or prejudice the
right of the releasor to recover thereunder.
(b) Each party agrees that its policies will include
such a clause or endorsement so long as the same shall be obtainable without
extra cost, or, if such cost shall be charged therefor, so long as the other
party agrees to pay such extra cost. If extra cost shall be chargeable therefor,
the releasing party shall notify the other party thereof and of the amount of
the extra cost, and the other party shall be obligated to pay the extra cost
unless, within ten (10)
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days after receipt of such notice, it elects, by written notice sent to the
releasing party, not to be obligated to do so. If such clause or endorsement is
not available, or if the other party should not desire the coverage at extra
cost, then the provisions of this subparagraph shall not apply to the policy or
policies in question.
6.6 Consequences of Landlord's Mortgagee Applying
---------------------------------------------
Insurance Proceeds to Pay or Reduce Landlord's
----------------------------------------------
Indebtedness
------------
(a) Landlord will attempt to require any first
mortgagee of the Leased Premises to agree that, in case of fire or other insured
casualty, the proceeds of insurance will be made available for use in repair and
restoration;
(b) If, however, the mortgage does not so provide and
the mortgagee applies the insurance proceeds to pay or reduce Landlord's
indebtedness, Landlord must replace the applied amount, without cost to Tenant,
and such replacement funds must be furnished prior to Tenant's commencement of
repairs and restoration.
(c) If the Landlord should fail to make advances as
set forth above or fail to do any other act required of Landlord under this
Lease, Tenant may cure such default, and the Landlord shall be responsible for
paying interest to Tenant on any monies expended by Tenant as provided in
Paragraph 12.3 hereof.
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ARTICLE VII
-----------
LANDLORD'S INTEREST NOT SUBJECT
-------------------------------
TO CERTAIN MECHANICS' LIENS
---------------------------
7.1 In General
----------
In connection with any alterations, improvements or
additions to the Leased Premises made by Tenant, there shall be no mechanics'
lien filed upon Landlord's or Tenant's interest in the Leased Premises arising
through the act of Tenant, or any person claiming under, by or through Tenant;
and no person other than an employee of Landlord shall ever be or become
entitled to any lien for or on account of any work, labor, material or services
furnished or provided to the Leased Premises at the request of Tenant. All
persons furnishing any such labor or material to Tenant, or with respect to the
Leased Premises at Tenant's order, or at the order of any person dealing
directly or indirectly with Tenant, as well as all persons whomsoever, shall be
bound by this provision; and all materialmen, contractors, mechanics and
laborers are hereby charged with notice that they must look only to Tenant for
payment for any bills for work done or performed or materials furnished during
the term hereby granted.
7.2 Filing of Liens
---------------
(a) The more filing of a prohibited mechanic's or
materialman's lien or liens, however, shall not of itself constitute a default
hereunder, provided Tenant, within thirty (30) days after the recording of such
notice of prohibited lien among the public records of the county where the
Leased Premises are located in the event notice of a prohibited lien is not
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served upon Tenant, shall cause the same to be canceled, released and
extinguished, or the Leased Premises released therefrom by the posting of a
bond, or by any other method prescribed by law, and proper evidence thereof be
furnished to Landlord; and if such prohibited lien or liens appear of record,
Tenant shall cause the same to be canceled, satisfied and discharged of record
within said thirty (30) day period.
(b) However, if Tenant shall dispute the amount or
validity of any prohibited mechanic's or materialman's lien claimed, or any
other claim asserted, Tenant shall post a bond with Landlord, reasonably
acceptable to Landlord, in the amount of the prohibited lien or claim and, with
all due diligence, institute or defend an appropriate action or proceeding in a
court or courts of competent jurisdiction upon the cause of action, and shall,
by injunction, due defense of the suit or otherwise, prevent any sale or
impairment of the title of Landlord, and shall prosecute or defend such action
or proceeding with reasonable diligence to a final determination, and, if such
suit or defense shall be instituted within said period of thirty (30) days after
the time when said prohibited lien shall have been filed, then in such case the
time reasonably required in the litigation of such action shall be added to the
above thirty (30) days' time. In any event, however, it shall be the duty of
Tenant, whether before or after contesting such prohibited lien, to cause the
said prohibited lien to be canceled, released, extinguished or adjudicated not
to exist, or to cause the Leased Premises to be released therefrom by the
posting of a bond or by any other method prescribed by law at least thirty (30)
days before the time when required to do so by any mortgagee or Landlord or when
the Leased Premises or any interest therein, or Landlord's interest therein,
might otherwise be offered for sale by reason of said prohibited lien; and,
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promptly upon relieving the Leased Premises of such prohibited claim, Tenant
shall have the duty of furnishing evidence thereof reasonably satisfactory to
Landlord.
ARTICLE VIII
------------
LAWFUL USE OF THE PREMISES
--------------------------
The Leased Premises and all structures and improvements thereon,
during the term of this Lease, shall be used only and exclusively for lawful
purposes, and Tenant will not use or suffer anyone to use the Leased Premises or
structures thereon for any purpose in violation of the laws of the United States
of the state in which the Leased Premises are located, or the ordinances and
regulations of the county or municipality in which the Leased Premises are
located; and Tenant shall save Landlord harmless from every such violation by
Tenant.
ARTICLE IX
----------
COMPLIANCE WITH REGULATIONS
---------------------------
OF PUBLIC BODIES
----------------
9.1 In General
----------
Other than for structural repairs or structural
replacements (including those relating to the roof), Tenant shall, at Tenant's
own cost and expense, perform all acts and do all things as shall be lawfully
required by any public body having jurisdiction over the Leased Premises,
including, by way of illustration and not in limitation, compliance with fire,
sanitary, health and safety regulations and zoning and setback requirements in
order to keep
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the Leased Premises at all times during the term of this Lease (except for any
requirements arising during the last two years of the Initial Term of this Lease
or any Renewal Term) in full compliance with the applicable and pertinent rules
and regulations of such bodies, provided, however, that Landlord shall bear the
cost and expense thereof to the extent necessary to remedy any condition in
existence on the date hereof
9.2 Environmental Law
-----------------
Nothing in Paragraph 9.1 or any other part of this Lease
shall be deemed to impose upon Tenant the responsibility of performing any
clean-up or remediation work at the Leased Premises with respect to any
violation of environmental control laws, rules, regulations or ordinances with
respect to any conditions which pre-existed the date of this Lease.
ARTICLE X
---------
UTILITY CHARGES
---------------
Tenant shall pay or cause to be paid all charges for water, gas,
electricity and public utilities used on or about the Leased Premises, and shall
pay or cause to be paid the same monthly or as they shall become due, which
charges shall be considered as Additional Rent. In the event that Tenant desires
more capacity or additional facilities, Tenant shall pay any and all costs
incurred in obtaining such added capacity or in bringing such facilities to the
Leased Premises, including all engineering fees connected therewith. Nothing in
this article X shall be construed to limit or abridge any of Landlord's rights
under Article XXII hereof. Landlord shall not be responsible for the
interruption or cessation of services, and any sum payable by Tenant shall not
be abated if services are interrupted.
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ARTICLE XI
----------
PAYMENT OF INSURANCE PREMIUMS
-----------------------------
Should Tenant, at any time during the continuance of this Lease,
fail, refuse or neglect to procure or pay for any of the policies of insurance
required in and by this Lease or to keep and maintain the same in full force and
effect, Landlord, at Landlord's option (and without such act constituting a
waiver of the default by Tenant), may obtain or renew such insurance; and
thereafter the amount or amounts of money paid by Landlord as the premium or
premiums thereon, plus interest at the rate equal to two (2) percentage points
above the prime rate of Bankers Trust Company publicly announced in New York,
New York, and in effect from time to time, shall be collectible by Landlord from
Tenant in the same manner as though such sums were rentals.
ARTICLE XII
-----------
MAINTENANCE AND REPAIRS
-----------------------
12.1 Tenant's Duties in General
--------------------------
Except for repairs required as a result of the
negligence of Landlord or Landlord's employees or agents, Tenant shall make all
necessary exterior and interior non-structural repairs or placements to the
Leased Premises, including repairs or replacements to the building's plumbing,
heating, cooling, electrical and other operating systems, so as to maintain the
same at all times in good condition, reasonable wear and tear and damage by the
elements and casualty expected.
-22-
12.2 Landlord's Duties
-----------------
In the event either Landlord or Tenant fails to make
those repairs required to be made by it hereunder within thirty (30) days after
receiving written notice from the other party that such repairs are needed (or,
with regard to repairs incapable of being completed within said thirty (30) day
period, to commence making, and thereafter diligently prosecute, said repairs
within said period), the other party may make, or cause to be made, said
repairs; and the defaulting party shall thereafter promptly reimburse the other
party for all expenses incurred by the other party on account thereof, plus
interest at the rate equal to the prime rate of Bankers Trust Company publicly
announced in New York, New York, and in effect from time to time. Such amount
owed to Landlord shall be deemed to be additional rent hereunder until paid.
ARTICLE XIII
------------
INDEMNIFICATION
---------------
Each party hereto shall indemnify the other party against any
expense (including reasonable attorneys' fees), loss or liability paid, suffered
or incurred as the result of any breach by such party or any representation,
warranty, covenant or condition of this Lease or the negligence of such party,
its agents or employees.
-23-
ARTICLE XIV
-----------
ASSUMPTION OF RISK
------------------
Except with respect to the negligence or intentional misconduct
of Landlord, Landlord's employees, agents, servants, invitees or
representatives, all personal property belonging to Tenant, its servants,
employees, suppliers, consignors, customers or licensees; located in or about
the Leased Premises shall be there at the sole risk of Tenant. Except with
respect to negligence or intentional misconduct, neither Landlord nor Landlord's
agents or employees shall be liable for the theft, loss or misappropriation of,
nor for any damage or injury to, such personal property; nor shall Landlord be
considered the voluntary or involuntary bailee of such personal property. Except
with respect to the acts or negligence of Landlord or her employees, agents,
servants, invitees or representatives, neither Landlord nor any mortgagee of
Landlord shall be liable for damage or injury of any kind to Tenant or any of
its officers, agents or employees or to any other persons or to any property by
reason of any existing or future condition, defect, matter or thing in, on or
upon the Leased Premises or for the acts, omissions or negligence of other
persons or tenants whatsoever or whether caused by fire, explosion, water, rain,
snow, frost, steam, gas, electricity, heat or cold, dampness, falling plaster,
sewers or sewage odors, noise, leaks from any part of the building or the roof
or common areas, the bursting or leaking of pipes, plumbing, electrical wiring
and equipment and fixtures of all kinds.
-24-
ARTICLE XV
----------
CONDEMNATION CLAUSE
-------------------
15.1 Disposition of the Award
------------------------
Unless and until the law of the State in which the
Leased Premises are located permits tenants to receive the value of their
leasehold interests as a separate award from that made to landlords, in the
event of any condemnation or taking of all or a part of the Leased Premises,
Landlord (or the mortgagee of any interest in the Leased Premises if, pursuant
to the terms of the mortgage, or if, pursuant to law, the mortgagee is entitled
to receive all or a portion of the condemnation award) shall be entitled to
receive the entire award for the value of. the estate vested by this Lease in
Tenant; and Tenant hereby expressly assigns to Landlord (or to the mortgagee as
provided above) any and all right title and interest of Tenant now or hereafter
arising in or to nay such award or any part thereof. Tenant shall not be
entitled to receive any part of such award from Landlord, the mortgagee, or the
condemning authority, except that Tenant shall have the right to assert a claim
against the condemning authority for the value of all improvements installed and
paid for by Tenant and for relocation expenses.
15.2 Effect of Various Takings
-------------------------
(a) If the entire Leased Premises is taken,
Tenant's obligations under this Lease shall terminate as of the date title vests
in the condemning authority.
(b) In case of a substantial taking, Tenant shall
have the option to terminate this Lease if, In Tenant's opinion, the business
cannot reasonably be operated in the portion of the Leased Premises not
condemned. Tenant shall give notice to Landlord of Tenant's
-25-
election to terminate or continue this Lease within sixty (60) days after
receipt of notice of the condemnation. If this Lease is not so terminated, the
Annual Fixed Rent shall be reduced by an amount to be determined by multiplying
the then current Annual Fixed Rent by a fraction, the numerator of which is the
square footage of the Leased Premises after the taking and the denominator of
which is the square footage of the Leased Premises prior to the taking.
(c) If there is a temporary taking which shall be
reasonably anticipated by Landlord to end upon a date which shall be within one
(1) year of the expiration date of the then applicable term of this Lease, then
any award shall be applied by Landlord to reduce Tenant's obligations hereunder,
this Lease will continue unaffected, and any excess award shall belong to
Landlord.
ARTICLE XVI
-----------
DEFAULT
-------
16.1 Events of Default
-----------------
The following are hereby designated "Events of Default";
(a) Tenant shall make an assignment of its property
for the benefit of creditors or shall file a voluntary petition under any
bankruptcy or insolvency law, or an involuntary petition under any bankruptcy or
insolvency law shall be filed against Tenant and such involuntary petition is
not dismissed within sixty (60) days after the filing thereof;
(b) a petition is filed by or against Tenant under
the reorganization provisions of the United States Bankruptcy Code or under the
provisions of any law of like import, unless such petition under said
reorganization provisions is dismissed within sixty (60) days after its filing;
-26-
(c) Tenant shall file a petition under the
arrangement provisions of the United States Bankruptcy Code or under the
provisions of any law of like import;
(d) a permanent receiver, trustee or liquidator
shall be appointed for Tenant or of or for the property of Tenant, and such
receiver, trustee or liquidator shall not have been discharged within sixty (60)
days from the date of his appointment;
(e) Tenant shall default in the payment of any rent
on any date upon which the same becomes due, and such default shall continue for
thirty (30) days;
(f) Tenant shall materially default in the due
keeping, observing or performing of any covenant, agreement, term, provision or
condition of this Lease on the part of Tenant to be kept, observed or performed,
and if such default shall continue and shall not be remedied by Tenant, or steps
shall not have been taken by Tenant to remedy such default, within thirty (30)
days after Landlord shall have given to Tenant a written notice specifying the
same, or, in the case of such a material default which, for causes beyond
Tenant's control, cannot with due diligence be cured, or steps cannot be taken
by Tenant to cure such default, within said period of thirty (30) days, if
Tenant (I) shall not, promptly upon receipt of such notice, advise Landlord in
writing of Tenant's intention to duly institute all steps necessary to remedy
the same, or (ii) shall not remedy the same within a reasonable time after the
date of the receipt of said notice from Landlord;
(g) any event shall occur or any contingency shall
arise whereby this Lease or the estate hereby granted or the unexpired balance
of the Initial Term or any Renewal Term hereof would, by operation of law or
otherwise, devolve upon or pass to any
-27-
person, firm, association or corporation other than Tenant except as expressly
permitted under Article XVIII hereof, or whenever Tenant shall desert or abandon
the Leased Premises or the same shall become vacant (whether the keys be
surrendered or not and whether the rent be paid or not), unless Tenant (I) is
not in default in the payment of rent hereunder, (ii) is maintaining all
insurance required of it hereunder, and (iii) is maintaining the Leased Premises
in good condition to the extent required hereunder;
(h) any act or omission which, with the passage of
time or the giving of notice, would constitute a default under any mortgage of
Landlord's interest in the Leased Premises, with Tenant's cure rights not to
extend beyond (10) days prior to the date which is deemed to result in
Landlord's being in default under such mortgage.
16.2 Landlord's Right to Terminate
-----------------------------
Upon the occurrence of any "Event of Default", Landlord
may give the Tenant a notice of intention to terminate this Lease at the
expiration of five (5) days from the date of the giving of such notice; and, in
the event such notice is given, unless the Event of Default has been remedied,
this Lease and the term and estate hereby granted (whether or not the term shall
theretofore have commenced) shall expire and terminate upon the expiration of
said five (5) days with the same effect as if that day were the date
hereinbefore set for the expiration of the term of this Lease, but Tenant shall
remain liable for damages as provided in Article XXI hereof.
-28-
ARTICLE XVII
------------
CUMULATIVE REMEDIES
-------------------
17.1 General Right of Re-Entry
-------------------------
(a) If this Lease shall expire and terminate as
provided in Article XVI, Tenant shall peaceably quit and surrender the Leased
Premises to Landlord and Landlord or Landlord's agents and servants may
immediately or at any time and without notice thereafter re-enter into or upon
the Leased Premises or any part thereof, either by summary dispossess
proceedings or by any suitable action or proceeding at law, without being liable
to indictment, prosecution or damages therefor, and may repossess the same, and
may remove any persons therefrom, to the end that Landlord may have, hold and
enjoy the Leased Premises again as and of her first estate and interest therein.
The words "re-enter", "re-entry", and "re-entered", as used in this Lease, are
not restricted to their technical legal meaning.
(b) In the event of any termination of this Lease
under the provisions of Article XVI, or in the event that Landlord shall
re-enter the Leased Premises under the provisions of this Article XVII, or in
the event of the termination of this Lease (or of re-entry), by or under any
summary dispossess or other proceeding or action or any summary dispossess or
other proceeding or action or any provision of law, Tenant shall thereupon pay
to Landlord (a) the Annual Rent and Additional Rent payable up to the time of
such termination of this Lease, or of such recovery of possession of the Leased
Premises by Landlord , whichever occurs first, and (b) damages pursuant to
Article XXI.
-29-
17.2 Injunction and Other Remedies
-----------------------------
In the event of a breach or threatened breach on the
part of Tenant with respect to any of the covenants, agreements, terms,
provisions or conditions on the part of or on behalf of Tenant to be kept,
observed or performed, Landlord shall also have the right of injunction. The
specified remedies to which Landlord may resort hereunder are cumulative and are
not intended to be exclusive of any other remedies or means of redress to which
Landlord may lawfully be entitled at any time, and Landlord may invoke any
remedy allowed at law or in equity as if specific remedies were not herein
provided for. During the pendency of any proceedings brought by Landlord to
recover possession by reason of a Tenant default, Tenant shall continue to make
all payments to Landlord due hereunder.
ARTICLE XVIII
-------------
ASSIGNMENT AND SUBLEASING
-------------------------
18.1 Assignment of Entire Lease or Subletting of
-------------------------------------------
Entire Leased Premises Not Incident to a
----------------------------------------
Sale of Tenant's Business
-------------------------
(a) If Tenant proposes to assign this Lease in its
entirety or to sublease the entire Leased Premises in a transaction which is not
incident to a sale of Tenant's business to the assignee or subtenant or an
affiliate thereof, Tenant shall serve upon Landlord a notice of such transaction
(a "Tenant's Lease Disposition Notice"). The Tenant's Lease Disposition Notice
shall give the name and address and financial information in Tenant's possession
concerning the proposed assignee or subtenant and the principal terms and
conditions
-30-
of the proposed assignment or sublease, including but not limited to, the
consideration to be paid to Tenant for the assignment of the Lease or the rent
and items of "Additional Rent" payable by the subtenant, the term and any
renewal terms, as the case may be.
(b) Landlord shall have a period of forty-five (45)
days from receipt of Tenant's Lease Disposition Notice in which to serve a
notice upon Tenant (a "Recapture Notice") that Landlord elects to recapture the
Leased Premises and terminate this Lease as of the date upon which the
assignment or sublease would have gone into effect (the "Termination Date"). If
Landlord serves a Recapture Notice, this Lease shall terminate as of the
Termination Date.
(c) If Landlord fails to serve a Recapture Notice
within the applicable period, Tenant shall have the right to proceed with the
proposed assignment or sublease upon the terms contained in the Tenant's Lease
Disposition Notice or other terms no more favorable to Tenant. If the proposed
transaction is an assignment, the assignment shall not relieve the Tenant from
its obligations under this Lease.
18.2 Permitted Assignments
---------------------
This Lease may be assigned, without the consent of
Landlord and without the provisions of subparagraph 18.1 applying, (a) to any
person acquiring the business of Tenant or the outstanding capital stock of
Tenant or substantially all the assets of Tenant or (b) to any direct or
indirect affiliate or subsidiary of Tenant. Any such assignment or subletting
shall not release Tenant from its obligations for the payment of rent herein
reserved and for the performance of those terms, covenants and conditions hereof
on Tenant's part to be performed.
-31-
ARTICLE XIX
-----------
HOLDING OVER
------------
In the event Tenant shall continue to occupy the Leases Premises
after the expiration of the demised term or any Renewal Term, such holding over
shall not constitute a renewal or extension of this Lease. Landlord may, at its
option, elect to treat Tenant as one who has not removed at the end of its term
and thereupon be entitled to all the remedies against Tenant provided by law, or
Landlord may elect to construe such holdover as a tenancy from month to month,
upon the same terms and conditions as herein provided, and in no event shall the
tenancy be deemed to be one from year to year.
ARTICLE XX
----------
BANKRUPTCY
----------
Neither this Lease nor any interest herein nor any estate hereby
created shall pass to any trustee or receiver or assignee for the benefit of
creditors or otherwise by operation of law. In the event the estate created
hereby shall be taken in execution or by other process of law, or if Tenant
shall be abjudicated insolvent or bankrupt pursuant to the provisions of any
state or Federal insolvency or bankruptcy act, or if a receiver or trustee of
the property of Tenant shall be appointed by reason of Tenant's insolvency or
inability to pay its debts (unless such appointment is dismissed within 120
days), or if any assignment shall be made of Tenant's property for the benefit
of creditors, then and in any such event Landlord may, at her option, in
addition to the remedies provided herein, terminate this Lease and all rights of
the Tenant herein
-32-
pursuant to Section 16.2 and Tenant shall be liable to Landlord for damages as
set forth in Article XXI below, by giving to Tenant notice in writing of the
election of Landlord so to terminate. Tenant makes no representation or warranty
to Landlord as to the enforceability of this Article XX.
ARTICLE XXI
-----------
DAMAGES FROM EVENTS OF DEFAULT
------------------------------
21.1 Damages
-------
In the event of any termination of this Lease under the
provisions of Article XVI, or in the event that Landlord shall re-enter the
Leased Premises under the provisions of Paragraph 17.1, or in the event of the
termination of this Lease (or of re-entry) by or under any summary dispossess
proceeding or action or any provision of law, Tenant, at the election of
Landlord, will pay to Landlord, in lieu of Tenant's continuing obligation to pay
Annual Fixed Rent or Additional Rent, as damages, the greater of:
(a) a sum which, at the time of such termination of
this Lease or at the time of any such re-entry by Landlord , as the case may be,
represents the excess, if any, of (I) the aggregate of all Annual Fixed Rent and
Additional RENT which would have been payable hereunder by Tenant had this Lease
not so terminated for the period commencing with the earlier of such termination
of this Lease or the date of any such re-entry, as the case may be, and ending
with the date hereinbefore set for the expiration of the full term hereby
granted , over (ii) the aggregate of all Annual Fixed Rental and Additional Rent
for the Leased Premises for the same period based upon the then local market
rental value of the Leased Premises; or
-33-
(b) sums equal to the aggregate of all Annual Fixed
Rental and Additional Rent which would have been payable by Tenant had this
Lease not so terminated, or had Landlord not so re-entered the Leased Premises,
payable upon the due dates therefor specified herein following such termination
or such re-entry and until the date hereinbefore set for the expiration of the
full term hereby granted.
21.2 Mitigation of Damages
---------------------
Landlord shall use reasonable efforts to re-let the
Leased Premises in an arms'-length, transaction. If Landlord shall re-let all or
any part of the Leased Premises for all or any part of said period, Landlord
shall credit Tenant with the net rents received by Landlord from such re-letting
(I) the actual expenses incurred or paid by Landlord in terminating this Lease
or of re-entering the Leased Premises and of securing possession thereof, as
well as (ii) the actual expenses of re-letting, including altering and preparing
the Leased Premises for new tenants, brokers' commissions, and all other similar
or dissimilar expenses properly chargeable against the Leased Premises and
incurred by Landlord which, but for Tenant's default, Landlord would not have
incurred and the rental therefrom in connection with such re-letting. Any such
re-letting may be for a period equal to or shorter or longer than the remaining
term of this Lease.
21.3 Limits of Tenant's Claims and Certain
-------------------------------------
Provisions for Benefit of Tenant
--------------------------------
(a) The provisions of subparagraphs 21.1 and 21.2
and Article VIII are subject to the following: (1) in no event shall Tenant be
entitled to receive any excess of such net rents over the Annual Fixed Rental
and Additional Rent payable hereunder; and (2) in
-34-
no event shall Tenant be entitled in any suit for the collection of damages
pursuant to this subparagraph (a) to a credit in respect of any net rents from a
re-letting, except to the extent that such net rents are actually received by
Landlord prior to the commencement of such suit.
(b) In the event that Landlord has been paid any
monies by or on behalf of Tenant pursuant to subparagraph 21.1 above, and
Landlord, within one (1) year thereafter, shall re-let the Leased Premises for
the same period of time for which she received the said payment from or
on behalf of Tenant pursuant to subparagraph 21.1 (b), then Landlord shall
refund to Tenant (or to the payor on behalf of Tenant) the monies so received by
Landlord pursuant to subparagraph 21.1 (b) above, which monies should have been
paid by Tenant to Landlord but for such default, without interest and without
further claim by ir on behalf of Tenant for any proceeds of the re-letting.
21.4 Suits for Recovery of Damages
----------------------------
Suit or suits for the recovery of damages, or any
installments thereof, may be brought by Landlord from time to time at its
election; and nothing contained herein shall be deemed to require Landlord to
postpone suit until the date when the term of this Lease would have expired if
it had not been terminated under the provisions of Article XVI, or under any
provision of law, or has Landlord not re-entered the Leased Premises.
-35-
ARTICLE XXII
------------
ALTERATIONS BY TENANT, PARTITIONS AND FIXTURES
----------------------------------------------
22.1 Tenant's Rights in General
-------------------------
(a) Tenant may, upon consent of Landlord, which
consent shall not be unreasonably withheld or delayed, at Tenant's own cost and
expense, make such alterations, improvements and additions as it may desire,
including alterations, improvements and additions of a structural nature, and
may construct such installations, buildings, roads, parking lots, excavations,
pipelines and such other structures, without limitation, as Tenant may desire,
so long as such constructions are not unlawful and are made and installed in a
good and workmanlike manner; provided, however, that Tenant may, over the term
of this Lease, make non-structural alterations or improvements, in accordance
with applicable laws and in a good and workmanlike manner, costing less than
$25,000 in the aggregate, per year, without the consent of Landlord.
(b) No structural alterations, additions or
improvements shall be made in or to the Leased Premises without Tenant's first
submitting to Landlord plans and specifications for such proposed alterations,
additions or improvements and Tenant's receiving the prior written consent of
Landlord. Any work performed by or on behalf of Tenant in connection therewith
shall comply with all applicable laws, ordinances and regulations, and Tenant
shall deliver to Landlord, prior to the commencement of any such work, copies of
all permits, approvals and licenses as required by applicable law. All costs and
expenses incurred by Landlord in connection with her review process of Tenant's
proposed work shall be at the sole cost and expense of Tenant, which costs shall
be deemed to be Additional Rent and shall be
-36-
added to the installment of Annual Fixed Rent becoming due on the first of the
next succeeding month and shall be collected by Landlord as Additional Rent
hereunder.
(c) Landlord shall not be liable for, and Tenant
hereby releases Landlord from, any loss or damage, of or to any tools,
machinery, equipment, materials or supplies or Tenant or any employee of Tenant,
or any employee of any of them. Notwithstanding the foregoing, the sole risk of
loss or damage resulting from theft or mysterious disappearance of the tools or
equipment, including equipment to be installed in the Leased Premises, shall be
that of Tenant, whether or not such loss or damage is insured against.
(d) Tenant shall indemnify and hold harmless
Landlord and Landlord's agents and employees from and against all claims,
damages, losses and expenses, including attorneys' fees and disbursements,
arising out of or in connection with any work performed by any of them, whether
or not attributable to active or passive negligence on the part of the
indemnitors and whether or not the indemnitors participated in any wrong.
22.2 Duty to Restore
---------------
Tenant shall be obligated, with respect to any
alteration or improvement, to restore the Leased Premises to their condition
prior to such alteration or improvement unless Landlord shall waive in writing
Tenant's obligation to restore such alteration or improvement at the time
Landlord's consent to the alteration or improvement is requested. However, if an
alteration, improvement or addition does not require Landlord's consent, then,
at the expiration or sooner termination of this Lease, Tenant shall not be
obligated to restore the Leased Premises to their condition prior to the making
of such alteration, improvement or
-37-
addition, and shall not be obligated to remove or cause to be removed such
alteration, improvement or addition.
22.3 Fixtures
--------
All machinery and equipment (other than fixtures
considered to have become a part of the real property to which it may have been
affixed and other than air conditioning and heating units) and machinery
constructed or placed in the Leased Premises at the expense of Tenant or any
predecessor of Tenant, including the Landlord (other than existing leasehold
improvements considered to be a part of the real property to which it may be
affixed) shall be and remain the property of Tenant, and all or any part thereof
may be removed by Tenant at any time during the term hereof or, upon a prior
termination of the term hereof, within ninety (90) days after such prior
termination or such shorter period as determined by Landlord so as not to
interfere with the re-letting of the Leased Premises, but Tenant shall be under
no obligation to remove the same and may, at its option, surrendered all or any
part thereof with the Leased Premises. In case of damage or disfigurement to
walls, ceilings or floors caused by such removal, the cost of repairing (but not
redecorating) the same shall be borne by Tenant. Tenant's right to remove
fixtures or equipment shall apply to any extension or renewal of this Lease.
22.4 Personal Property
-----------------
Any personal property which shall remain in the Leased
Premises or any part thereof for thirty (30) days after the expiration or
termination of the term of this Lease shall be deemed to have been abandoned,
and either may be retained by Landlord as Landlord's property or may be disposed
of in such manner as Landlord may see fit; provided, however, that,
-38-
notwithstanding the foregoing, Tenant will, upon request of Landlord made not
later than thirty (30) days after the expiration or termination of the term
hereof, promptly remove from the building any such personal property at Tenant's
own cost and expense. If such personal property pr any part thereof shall be
sold by Landlord, Landlord may receive and retain the proceeds of such sale as
Landlord's property.
ARTICLE XXIII
-------------
SALE OR MORTGAGE OF LEASED PREMISES
-----------------------------------
23.1 Effect on Tenant's Rights
-------------------------
Subject to the terms of any non-disturbance agreements
entered into by any mortgagee, this Lease, and the rights and benefits granted
to Tenant and its successors and assigns hereunder, shall not be affected or
impaired by any sale, transfer or mortgage of the Leased Premises, and any
person, firm, corporation or entity purchasing or otherwise acquiring any right,
title or interest in or to the Leased Premises or any part thereof or lien
thereon shall be bound by, and shall take such right, title and interest subject
to, the rights and benefits if Tenant and its successors and assigns under this
Lease; provided, however, that Tenant shall agree to subordinate this Lease to
future mortgages upon receipt of a "non-disturbance agreement" in form and upon
such terms reasonably acceptable to Tenant.
-39-
23.2 Tenant's Future Actions
-----------------------
Tenant agrees that, upon request by Landlord, Tenant will
execute, acknowledge and deliver such document or instrument as may be
reasonably requested by the holder of any mortgage on the Landlord's interest in
the Leased Premises, confirming or agreeing that this Lease is assigned to such
mortgagee as collateral security for such mortgage and agreeing to abide by such
assignment, provided that a copy of such assignment has in fact been delivered
to Tenant.
ARTICLE XXIV
------------
ESTOPPEL CERTIFICATE
--------------------
At any time and from time to time, upon not less than five (5)
business days' prior notice, Landlord or Tenant shall execute, acknowledge and
deliver to Landlord or Tenant, or to anyone Landlord or Tenant shall designate,
an Estoppel Certificate executed by Landlord or Tenant (or if Landlord or Tenant
is a corporation by an appropriate officer of Landlord or Tenant), certifying,
if the same is due, that this Lease is unmodified and in full force and effect
(or if there have been modifications, that the same is in full force and effect
as modified and stating the modifications), and the dates to which rent has been
paid in advance, if appropriate, and stating whether or not, to the best
knowledge of the signer of such certificate, Landlord or Tenant is in default in
performance of any covenant, agreement, term, provision or condition contained
in this Lease, and, if so, specifying such default of which the third party may
have knowledge.
-40-
ARTICLE XXV
-----------
SHORT FORM LEASE
----------------
Landlord agrees, promptly after the execution of this Lease, to
execute and deliver to Tenant a short form of Lease, or Notice of Lease, for
recording purposes in form reasonably satisfactory to Tenant.
ARTICLE XXVI
------------
SUBORDINATION AND OTHER PROVISIONS
----------------------------------
FOR BENEFIT OF MORTGAGE, ETC.
-----------------------------
26.1 Subordination in General
------------------------
(a) This Lease is and shall be subject and subordinate
to all present and future ground or underlying leases and to all mortgages,
options and building loan agreements that may now or hereafter affect such
leases or the Building and to all renewals, modifications, consolidations,
replacements and extensions of any such ground or underlying leases, options,
and mortgages. The provisions of this subparagraph 24.1 shall be self-operative
and no further instrument of subordination shall be required. In confirmation of
such subordination, Tenant shall execute and deliver promptly, at its own cost
and expense, any instrument, in recordable form if required, that Landlord, the
lessor of any ground or underlying lease, or the holder of any such mortgage, or
any of their respective successors in interest, may request to evidence such
subordination.
-41-
(b) The subordinations as to future ground or
underlying leases, mortgages and building loan agreements shall be conditioned
upon the Tenant's receiving a "Non-Disturbance Agreement" providing, in essence,
that Tenant's possession will not be disturbed by any foreclosure proceeding or
deed in lieu of foreclosure so long as Tenant is not in default under this
Lease.
26.2 Attornment, Etc. to Mortgagee
-----------------------------
(a) In the event of a termination of any ground or
underlying lease, or if the interests of Landlord under this Lease are
transferred by reason of, or assigned in lieu of, foreclosure or other
proceedings for enforcement of any mortgage, or if the holder of any mortgage
acquires a lease in substitution therefor, then Tenant, under this Lease, will,
at the option, to be exercised in writing, of the Landlord under such ground or
underlying lease or such mortgagee or purchaser, assignee or lessee, as the case
may be, either (1) attorn to it and perform for its benefits all the terms,
covenants and conditions of this Lease on Tenant's part to be performed with the
same force and effect as if such lessor, mortgagee, purchaser, assignee or
lessee were the landlord originally named in this Lease, or (2) enter into a new
lease with said lessor, mortgagee, purchaser, assignee or lessee, as landlord,
for the remaining Term of this Lease and otherwise on the same terms and
conditions and with the same options, if any, then remaining.
(b) The provisions of subsection 24.2 (a) shall
inure to the benefit of such lessor, mortgagee, purchaser, assignee or lessee,
and shall be self-operative upon the exercise of such option; and no further
instrument shall be required to give effect to said provisions. Tenant, however,
upon demand of any such lessor, mortgagee, purchaser, assignee or
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lessee, agrees to execute, from time to time, instruments in confirmation of the
provisions of subparagraph 24.2 (a) satisfactory to any such lessor, mortgagee,
purchaser, assignee or lessee, acknowledging such attornment and setting forth
the terms and conditions of its tenancy.
26.3 Certain Protective Provisions for
---------------------------------
Mortgagees and Those Claiming Under Them
----------------------------------------
Under no circumstances shall any lessor under a ground
lease or mortgagee or purchaser, assignee or lessee, as the case may be, whether
or not it shall have succeeded to the interests of the Landlord under this
Lease, be:
(a) liable for any act, omission or default if any
prior landlord or for the return of any security deposit or part thereof not
actually received by such lessor, mortgagee, purchaser, assignee or lessee, as
the case may be; or
(b) subject to any offsets, claims or defenses that
the Tenant might have against any prior Landlord; or
(c) bound by any Rent or Additional Rent that Tenant
might have paid to any prior landlord for more than one (1) month in advance or
for more than three (3) months in advance where such Rent payments are payable
at intervals of more than one (1) month; or
(d) bound by any modification, amendment or
abridgement of the Lease, or any cancellation or surrender of the same, made
without its prior written approval.
-43-
26.4 Confirmation by Tenant of Assignment of
---------------------------------------
Lease to Mortgagee as Collateral Security
-----------------------------------------
Tenant agrees that, upon request of Landlord, Tenant
will execute, acknowledge and deliver such document or instrument as may be
requested by the holder of any mortgage on the Landlord's interest in the
building confirming or agreeing that this Lease is assigned to such mortgagee as
collateral security for such mortgage and agreeing to abide by such assignment,
provided that a copy of such assignment has in fact been delivered to Tenant.
ARTICLE XXVII
-------------
PARTIES BOUND
-------------
27.1 General Provisions
------------------
The covenants, agreements, terms, provisions and
conditions of this Lease shall bind and benefit the respective successors,
assigns and legal representatives of the parties hereto with the same effect as
if mentioned in each instance where a party hereto is named or referred to.
27.2 Landlord Not Bound After
------------------------
Termination of its Interest
---------------------------
It is understood and agreed that the covenants and
obligations on the part of Landlord herein named with respect to any period
subsequent to the transfer of its interest in the Leased Premises; that in the
event of such transfer, such covenants and obligations shall thereafter be
binding upon each transferee of such interest of Landlord herein named, but only
with respect to the period ending with a subsequent transfer of such interest.
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ARTICLE XXVIII
--------------
EXCULPATION OF LANDLORD FROM PERSONAL LIABILITY
-----------------------------------------------
Notwithstanding anything to the contrary set forth in this Lease,
it is specifically understood and agreed by Tenant that there shall be
absolutely no personal liability on the part of Landlord or on the part of the
partners of Landlord with respect to any of the terms, covenants and conditions
of this Lease; and Tenant shall look solely to the equity, if any, of Landlord
in the Leased Premises for the satisfaction of each and every remedy of Tenant
in the event of any breach by Landlord of any of the terms, covenants and
conditions of this Lease to be performed by Landlord, this exculpation of
personal liability to be absolute and without any exception whatsoever.
ARTICLE XXIX
------------
SUBORDINATION OF LANDLORD'S RIGHT OF DISTRAINT
----------------------------------------------
Landlord agrees to execute a written subordination or waiver of
Landlord's right of distraint for unpaid rent in favor of any lending
institution which from time to time makes a loan to Tenant secured by the items
of Tenant's property which are the subject of Landlord's right of distraint.
Landlord agrees to execute the form of Landlord's Waiver, License and Agreement
heretofore submitted by Gibraltar Corporation of America.
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ARTICLE XXX
-----------
ESTOPPEL CERTIFICATE
--------------------
At any time and from time to time, upon not less than ten (10)
days' prior notice, Landlord or Tenant shall execute, acknowledge and deliver to
Landlord or Tenant, or to anyone Landlord or Tenant shall designate, an Estoppel
Certificate executed by Landlord or Tenant (or if Landlord or Tenant is a
corporation, by an appropriate officer of Landlord or Tenant), certifying, if
the same is true, that this Lease is unmodified and in full force and effect (or
if there have been modifications, that the same is in full force and effect as
modified and stating the modifications), and the date to which Rent has been
paid in advance, if appropriate, and stating whether or not, to the best
knowledge of the signer of such certificate, Landlord or Tenant is in default in
performance of any covenant, agreement, term, provision or condition contained
in this Lease, and, if so, specifying each such default of which the signer may
have knowledge.
ARTICLE XXXI
------------
ENTIRE AGREEMENT
----------------
This Lease, which includes Schedules "A" and "B" annexed hereto,
contains the entire agreement between Landlord and Tenant with respect to the
lease by Tenant of the Leased Premises and supersedes all prior arrangements and
understandings with respect thereto.
-46-
ARTICLE XXXII
NOTICES
All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered personally
by courier service, with receipt, or sent by registered or certified mail,
postage prepaid, addressed as follows:
If to Landlord:
Zanzi Realty, LLC
XX Xxx 000
Xxxxxxxxxx, Xxx Xxxx 00000
If to Tenant:
The RAL Supply Group, Inc.
00 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxxxx, President
Any party may by notice change the address to which notice or other
communications to it are to be delivered or mailed.
ARTICLE XXXIII
--------------
WAIVERS AND AMENDMENTS
----------------------
Any waiver of any term or condition, or any amendment or
supplementation, of this Lease shall be effective only if in writing executed by
the party sought to be charged therewith. A waiver of any breach or failure to
enforce any of the terms or conditions
-47-
of this Lease shall not in any way affect, limit or waive a party's right
hereunder at any time to enforce strict compliance thereafter with every term of
this Lease.
ARTICLE XXXIV
-------------
BROKERAGE
---------
Tenant covenants, represents and warrants that Tenant has had no
dealings or communications with any broker or agent in connection with the
consummation of this Lease; and Tenant covenants and agrees to pay, hold
harmless and indemnify Landlord from and against any and all cost, expense
(including reasonable attorneys' fees and disbursements) or liability for any
compensation, commissions or changes claimed by any broker or agent with respect
to this Lease or the negotiation thereof.
IN WITNESS WHEREOF, the parties hereto have executed, or caused to be
executed, this Agreement as of the day and year first above written.
LANDLORD
ZANZI REALTY, LLC
BY: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx, Member
TENANT
THE RAL SUPPLY GROUP
BY: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx, President
LIZZIE REALTY, LLC
TO
THE RAL SUPPLY GROUP, INC.
"Schedule A"
Leased Premises
---------------
Approximately 10,000 square feet on upper floor (all the space except store
leased to others).
LIZZIE REALTY, LLC
ZANZI REALTY, LLC
TO
THE RAL SUPPLY GROUP, INC.
"Schedule B"
Additional Provisions to Lease
------------------------------
I. Annual Fixed Rent in Initial Term and Renewal Terms
---------------------------------------------------
1.1 The "Annual Fixed Rent" for the first year of the Initial Term
shall be the sum of Seventy Eight Thousand ($78,000) Dollars per year
or Six Thousand Five Hundred ($6,500) per month.
1.2 Every year, starting with the second year, the Annual Fixed Rent
shall be adjusted upward, but never decreased, pursuant to the
provisions hereof.
1.3 For the purposes of this Schedule, the following terms have the
following meanings:
"Index" - The All Items Index (New York Services)
for the U.S. City Average of the Consumers Price
Index for Moderate Families in Large Cities
published by the United States Bureau of Labor,
and any successor thereto (1982 - 1986=100).
"Base Month" - May 1996
"Comparison
Month" - May 1996 and every May thereafter.
1.4 The Annual Fixed Rent for the second year of the Initial Term
shall be $78,000 per year, increased by the percentage of increase of
the Index of the Comparison Month (May 1997) over the Base Month (May
1996), except that in no event shall the increase be less than a two
(2%) percent increase over the previous year or more than an eight
(8%) percent increase over the previous year.
Example Number One
------------------
Assume that the Index for May 1997 shows a nine (9%) percent increase over
the Index for May 1996. The Annual Fixed Rent for the second year is
limited to $84,240.
Page 1 of 2
1.5 The same procedure shall be followed every year throughout the
Initial Term and the Renewal Terms, with the applicable percentage of
increase to be multiplied times the Annual Fixed Rent for the year
just concluded.
Example Number Two
------------------
Assume that the Index for May 1998 shows a further five (5%) percent
increase over the Index for May 1996. The Annual Fixed Rent for the third
year is limited to $88,452.
1.6 Because the Index is not published until after the close of a
month, the adjustment In Annual Fixed Rent shall be made when the
Comparison Month's Index is published and Landlord presents to Tenant
the comparison figure and computation of adjustment of Fixed Rent; and
any increase for months already elapsed since the end of the prior
year shall be added to the next installment of Fixed Rent.
1.7 If the applicable Comparison Month Index should not be published,
the last applicable published figure for the Index shall be used,
except that such prior month's Index shall not be used retroactively
for a period in excess of three (3) months.
1.8 In the event that the Index is discontinued, the parties shall
agree upon an equivalent and substituted Index to be applied in the
same manner.
ATTEST: LANDLORD
ZANZI REALTY, LLC
/s/ Xxxx Xxxxx
----------------------------------
Xxxx Xxxxx By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx, Member
ATTEST: TENANT
THE RAL SUPPLY GROUP, INC.
/s/ Xxxx Xxxxx
----------------------------------
Xxxx Xxxxx By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx, President
Page 2 of 2
RIDER "I"
ENVIRONMENTAL MATTERS RIDER TO LEASE
Dated: June 5, 1996
ZANZI REALTY. LLC
-----------------
("Landlord")
THE RAL SUPPLY GROUP, INC.
--------------------------
("Tenant")
1. General Prohibitions on Tenant's Conduct
----------------------------------------
1.1 Tenant shall not use or suffer the Leased Premises to be used
in any manner as to create or cause an environmental violation or hazard. Not in
limitation of the generality of the above, it is understood that Tenant shall
not cause or suffer to be caused any chemical contamination or discharge of
substance of any nature which is noxious, offensive or harmful or which, under
any law, rule or regulation of any governmental authority having jurisdiction,
constitutes a hazardous substance or hazardous waste.
1.2 Tenant shall not generate, manufacture, refine, transport,
treat, store, handle, dispose or otherwise deal with any hazardous substances or
hazardous waste as presently or in the future defined in the Environmental
Cleanup Responsibility Act of New Jersey (N.J.S.A. 13:1 k-6et seq.) ("ECRA")
-------------------------
(the generation, manufacture, refinement, transportation, treatment, storage,
handling, disposition and/or otherwise dealing with such substance or waste, as
the case may be, being referred to for the convenience as :dealing with" such
substances or waste).
2. Tenant's Compliance with ECRA and the Spill Act, Etc.
-----------------------------------------------------
2.1 If at any time during the Term of this Lease there shall be
required, with respect to the Leased Premises or any part thereof, any act
pursuant to or compliance with ECRA including the filing of any required notice
of sale or negative declaration affidavits or the preparation or effectuation of
any clean-up plans, Tenant shall be responsible for such compliance as if Tenant
were the "owner" of the Leased Premises as defined by ECRA.
2.2 Tenant hereby agrees to indemnify and hold harmless and defend
in the first instance Landlord from and against any and all claims, losses'
liabilities, damages, clean-up costs and reasonable attorney fees (a) arising
directly or indirectly from, out of or by reason of any discharge of hazardous
substances or environmental complaints, caused or permitted by Tenant or any
subtenant of Tenant during the Term of this Lease, or (b) failure of Tenant or
any subtenant of Tenant to comply with ECRA or any other environmental law now
or hereafter in effect.
Page 1 of 3
2.3 Tenant expressly acknowledges its understanding and agreement
that at the expiration or earlier termination of this Lease, or of any sublease
or subtenancy, certain notices, filing and possibly, sampling plans, cleanup
plans and cleanup work will be required by the State of New Jersey if Tenant's
or any subtenant's use of the Leased Premises or any part thereof renders the
premises an "industrial establishment" under ECRA, and that Tenant shall, either
in its own name, or if required, in the name of Landlord, comply, at Tenant's
own expense, with all such applicable notices, filings and the like and
indemnify and hold Landlord harmless, to the extent elsewhere provided in this
Lease with respect to Tenant's indemnities and hold harmless agreements, against
any responsibility which may be placed upon Landlord for or relating to the
matter such requirement.
2.4 At the request of Landlord from time to time, Tenant shall:
(a) provide to Landlord copies of any documents filed
by Tenant Pursuant to ECRA;
(b) permit Landlord to be present at any inspections,
on or off site, and at any meeting of the Department of
Environmental Protection of New Jersey or other
meetings, relating to ECRA; and
(c) provide Landlord with an inventory of materials
and substances dealt with by Tenant at the Premises, as
well as such additional information reasonably
requested by Landlord in order that Landlord be able to
provide required information for ECRA filings or for
determination of whether there has been compliance with
any environmental law, including ECRA, including but
not limited to the following information with respect
to Tenant and all or any subtenant(s), as requested;
(I) the standard of industrial classification
applicable to the use of the Leased Premises
by Tenant and such subtenant(s);
(II) inventory of hazardous substances and
wastes dealt with at the Leased Premises;
(III) a listing of all Federal and State
environmental permits and enforcement actions
for violation of environmental laws;
(IV) a scaled site map identifying all areas
where substances or wastes are dealt with;
Page 2 of 3
(V) a description of storage vessels containing
wastes or substances, by type and location;
(VI) notification regarding any spill or discharge
of hazardous substances or wastes (including
description and location of such); and
(VII)copies of all soil, ground water or surface
water sampling results (including effluent
quality monitoring, conducted at the Leased
Premises).
3. Subtenants
----------
3.1 It shall be the responsibility of Tenant to require any
subtenant of the Leased Premises to agree expressly in writing to comply with
the provisions of this paragraph.
3.2 Tenant shall use its best efforts to cause the principals of
any corporate subtenant to agree to be personally responsible for compliance
with the provisions of this Rider.
4. Survival
--------
The provisions of this Rider shall survive the expiration or
earlier termination of this Lease.
ZANZI REALTY, LLC
(Landlord)
WITNESS By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx, Member
THE RAL SUPPLY GROUP, INC.
(Tenant)
By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx, President
Page 3 of 3
