Exhibit 10.21
Texas Commercial Lease Agreement
This Commercial Lease Agreement ("Lease") is made and effective this ____ day of
March, 2006, by and between Agribiofuels, LLC, a Texas Limited Liability Company
("Landlord") and Xxxxxxx Xxxx, Inc. ("Tenant").
Landlord is the owner of land and improvements commonly known and numbered as
eighteen acres more or less on Xxxxxxx Industrial Road, Dayton, TX and legally
described as follows (the "Property"): 18.8147 acres, more or less, out of Lots
26, 27, 44 and 45 of the Maysville Addition in the City of Dayton in the South
Xxxxxxx Xxxx Xxxxxx, X-000, Xxxxxxx Xxxxxx, Xxxxx according to the plat
thereof recorded in Volume N, Page 616 of the Deed Records of Liberty
County, Texas.
Landlord makes available for lease a portion of the Property designated as that
section of the Property currently occupied by the Tenant for the purposes of
operating a rice milling and feed processing plant (the "Leased Premises"). The
Leased Premises shall consist of that area (at the time of this writing) upon
which the rice milling and feed plant rests, the loading and unloading
facilities connected to the plant, and that office on the south side of the 9700
square foot office building on the property which at this time the Tenant uses.
A copy of the plat with the Leased Premises highlighted is attached to this
lease as "Exhibit A". A copy of the office building floorplan with the Leased
Premises highlighted is attached to this lease as "Exhibit B".
Landlord desires to lease the Leased Premises to Tenant, and Tenant desires to
lease the Leased Premises from Landlord for the term, at the rental and upon
the covenants, conditions and provisions herein set forth.
THEREFORE, in consideration of the mutual promises herein, contained and other
good and valuable consideration, it is agreed:
1. Term.
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Landlord hereby leases the Leased Premises to Tenant, and Tenant hereby leases
the same from Landlord, for an "Initial Term" beginning on the above date and
ending in three years. Additionally, there is marked on Exhibit B an area of
office space and common space which shall be leased for a term of one year.
Landlord shall use its best efforts to give Tenant possession as nearly as
possible at the beginning of the Lease term. If Landlord is unable to timely
provide the Leased Premises, rent shall xxxxx for the period of delay. Tenant
shall make no other claim against Landlord for any such delay.
2. Rental.
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Tenant shall pay to Landlord during the Initial Term rental of thirty thousand
dollars per year, payable in installments of two thousand five hundred dollars
per month. Each installment payment shall be due in advance on the first day of
each calendar month during the lease term to Landlord at 0000 Xxxxx Xxxxxxxxx
Xx., Xxxxxxx, Xxxxx 00000 or at such other place designated by written notice
from Landlord or Tenant. The rental payment amount for any partial calendar
months included in the lease term shall be prorated on a daily basis.
3. Sublease and Assignment
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Tenant shall have the right without Landlord's consent, to assign this
Lease to a corporation with which Tenant may merge or consolidate, to any
subsidiary of Tenant, to any corporation under common control with Tenant, or to
a purchaser of substantially all of Tenant's assets. Except as set forth above,
Tenant shall not sublease all or any part of the Leased Premises, or assign this
Lease in whole or in part without Landlord's consent, such consent not to be
unreasonably withheld or delayed.
4. Repairs
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During the Lease term, Tenant shall make, at Tenant's expense, all necessary
repairs to the Leased Premises. Repairs shall include such items as routine
repairs of floors, walls, ceilings, and other parts of the Leased Premises
damaged or worn through normal occupancy, except for, in the case of the leased
office space, major mechanical systems or the roof, subject to the obligations
of the parties otherwise set forth in this Lease. All repairs, whether routine,
major mechanical or to the roof of the milling and feed processing plant are the
sole responsibility of the Tenant.
5. Damage to the Plant
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If, through no fault or negligence of the Tenant or Landlord, the milling and
feed portion of the Leased Premises shall be damaged by fire or other casualty
to the extent that it becomes wholly untenantable, the rent shall cease until
such time as said premises shall have been repaired by the Tenant, or if in the
case the damage to the premises is in the opinion of the Landlord and Tenant so
extensive as to be infeasible to repair in a timely or economic manner, then the
rent shall be paid only up to the time of such destruction or damage, and this
lease shall become void from such time.
6. Alterations and Improvements
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Tenant, at Tenant's expense, shall have the right following Landlord's consent
to remodel, redecorate, and make additions, improvements and replacements of and
to all or any part of the Leased Premises from time to time as Tenant may deem
desirable, provided the same are made in a workmanlike manner and utilizing good
quality materials. Tenant shall have the right to place and install personal
property, trade fixtures, equipment and other temporary installations in and
upon the Leased Premises, and fasten the same to the premises. All personal
property, equipment, machinery, trade fixtures and temporary installations,
whether acquired by Tenant at the commencement of the Lease term or placed or
installed on the Leased Premises by Tenant thereafter, shall remain Tenant's
property free and clear of any claim by Landlord. Tenant shall have the right to
remove the same at any time during the term of this Lease provided that all
damage to the Leased Premises caused by such removal shall be repaired by Tenant
at Tenant's expense.
7. Permits
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Tenant shall maintain all government permits, whether federal, state or local,
required for the operation of its business, at its sole expense. Landlord shall
likewise be responsible for permits required by its own operations. Both parties
agree that they shall not unreasonably withhold their cooperation from the other
party's attempt to obtain such permits.
8. Compliance with Law
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Tenant shall, during the term of this Lease, make all repairs, alterations,
additions or replacements to the Premises required by any law or ordinance or
any order or regulation of any public authority; keep the Leased Premises safe
and equipped with all safety appliances so required; and comply with, and
perform all repairs, alterations, additions or replacements required by, the
orders and regulations of all governmental authorities with respect to zoning,
building, fire, health and other codes, regulations, ordinances or laws
applicable to the Leased Premises or applicable to the Leased Premises or other
portions of the Property and arising out of any use being conducted in or on the
Leased Premises or arising out of any work performed by Tenant, except that
Tenant may (but only so long as (i) Landlord shall not be subject to any fine or
charge, (ii) neither the Property nor any portion thereof shall be subject to
being condemned or vacated and (iii) neither the Property nor any portion
thereof shall be subject to any lien or encumbrance) defer compliance so long as
the validity of any such law, ordinance, order or regulation shall be contested
by Tenant in good faith and by appropriate legal proceedings, if Tenant first
gives Landlord assurance or security against any loss, cost or expense on
account thereof in form and amount acceptable to Landlord.
9. Hazardous Materials
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Tenant shall not introduce or transfer to the Premises or Property, any
Hazardous Materials (as hereinafter defined); nor dump, flush or otherwise
dispose of any Hazardous Materials into the drainage, sewage or waste disposal
systems serving the Premises or Property; nor generate, store, use, release,
spill or dispose of any Hazardous Materials in or on the Premises or the
Property, or to transfer any Hazardous Materials from the Premises to any other
location; and Tenant shall not commit or suffer to be committed in or on the
Premises or Property any act which would require any reporting or filing of any
notice with any governmental agency pursuant to any statutes, laws, codes,
ordinances, rules or regulations, present or future, applicable to the Property
or to Hazardous Materials. This paragraph shall not prohibit Tenant from storing
and using fungicidal or pesticide fumigants used in the production, handling and
storage of grain for which the Tenant has all required permits to purchase, use
and store, or minimal quantities of cleaning fluids, photocopy toner and other
products or substances which may constitute Hazardous Materials, but which are
customarily present in or about premises devoted to administrative office uses
provided (i) that such use, including storage and disposal thereof, by Tenant is
in strict compliance with all Environmental Laws and the manufacturer's
instructions and recommendations for the safe use and disposal of such products,
and (ii) Tenant follows the highest recognized standard of care with respect to
the use and disposal of such products.
Tenant agrees that if Tenant or any of Tenant's employees, agents, contractors
or invitees shall generate, store, release, spill, dispose of or transfer to the
Premises or Property any Hazardous Materials, Tenant shall forthwith remove the
same, at its sole cost and expense, in the manner provided by all applicable
Environmental Laws (as hereinafter defined), regardless of when such Hazardous
Materials shall be discovered. Furthermore, Tenant shall pay any fines,
penalties or other assessments imposed by any governmental agency with respect
to any such Hazardous Materials and shall forthwith repair and restore any
portion of the Premises or Property which it shall disturb in so removing any
such Hazardous Materials to the condition which existed prior to Tenant's
disturbance thereof.
Tenant agrees to deliver promptly to Landlord any notices, orders or similar
documents received from any governmental agency or official concerning any
violation of any Environmental Laws or with respect to any Hazardous Materials
affecting the Premises or Property. In addition, Tenant shall, within ten (10)
days of receipt, accurately complete any questionnaires from Landlord or other
informational requests relating to Tenant's use of the Premises and, in
particular, to Tenant's use, generation, storage and/or disposal of Hazardous
Materials at, to, or from the Premises.
Tenant shall indemnify, defend (by counsel satisfactory to Landlord), protect,
and hold Landlord free and harmless from and against any and all claims, or
threatened claims, including without limitation, claims for death of or injury
to any person or damage to any property, actions, administrative proceedings,
whether formal or informal, judgments, damages, punitive damages, liabilities,
penalties, fines, costs, taxes, assessments, forfeitures, losses, expenses,
attorneys' fees and expenses, consultant fees, and expert fees that arise from
or are caused in whole or in part, directly or indirectly, by (i) use, analysis,
storage, transportation, disposal, release, threatened release, discharge or
generation of Hazardous Materials to, in, on, under, about or from the Premises
by Tenant or Tenant's employees, agents, contractors or invitees, or (ii)
Tenant's failure or the failure of any of Tenant's employees, agents or
contractors to comply with any Environmental Laws. Tenant's obligations
hereunder shall include, without limitation, and whether foreseeable or
unforeseeable, all costs (including, without limitation, capital, operating and
maintenance costs) incurred in connection with any investigation or monitoring
of site conditions, repair, cleanup, containment, remedial, removal or
restoration work, or detoxification or decontamination of the Premises, and the
preparation and implementation of any closure, remedial action or other required
plans in connection therewith. For purposes of this Section 6.2.8, any acts or
omissions of Tenant, or by employees, agents, assignees, contractors or
subcontractors of Tenant or others acting for or on behalf of Tenant (whether or
not they are negligent, intentional, willful or unlawful) shall be attributable
to Tenant.
The term "HAZARDOUS MATERIALS" shall mean and include any oils, petroleum
products, asbestos, radioactive, biological, medical or infectious wastes or
materials, and any other toxic or hazardous wastes, materials and substances
which are defined, determined or identified as such in any Environmental Laws,
or in any judicial or administrative interpretation of Environmental Laws.
The term "ENVIRONMENTAL LAWS" shall mean any and all federal, state and
municipal statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, codes, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements or other governmental restrictions relating to the
environment or to emissions, discharges or releases of pollutants, contaminants,
petroleum or petroleum products, medical, biological, infectious, toxic or
hazardous substances or wastes into the environment including, without
limitation, ambient air, surface water, ground water or land, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of pollutants, contaminants, petroleum or
petroleum products, medical, biological, infectious, toxic or hazardous
substances or wastes or the cleanup or other remediation thereof.
10. Indemnification
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Tenant shall save Landlord harmless, and exonerate and indemnify Landlord from
and against any and all claims, liabilities or penalties asserted by or on
behalf of any person, firm, corporation or public authority on account of
nuisance or injury, death, damage or loss to person or property in or upon the
Leased Premises and/or the Property (a) arising out of the use or occupancy of
the Leased Premises by Tenant or by any person claiming by, through or under
Tenant (including, without limitation, all patrons, employees, contractors,
vendors, suppliers, invitees and customers of Tenant), (b) arising out of labor
disputes with Tenant's employees or strikes, picketing or other similar actions,
or (c) on account of or based upon anything whatsoever done on or occurring in
the Premises during the term of this Lease except if the same were caused by the
negligence or willful misconduct of Landlord, its agents, servants or employees.
In respect of the matters set forth above, Tenant shall indemnify Landlord (and
such others as are in privity of estate with Landlord) from and against all
costs, expenses (including reasonable attorneys' fees), and liabilities incurred
in or in connection with any such claim, action or proceeding brought thereon.
11. Property Taxes.
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Landlord shall pay, prior to delinquency, all general real estate taxes and
installments of special assessments coming due during the Lease term on the
Leased Premises, and all personal property taxes with respect to Landlord's
personal property, if any, on the Leased Premises. Tenant shall be responsible
for paying all personal property taxes with respect to Tenant's personal
property at the Leased Premises. The Tenant shall provide Landlord with any
documentation of Tenant's operations on the Property which may assist the
Landlord in receiving a favorable property tax designation or property value.
12. Insurance.
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A. If the Leased Premises or any other part of the Property is damaged by fire
or other casualty resulting from any act or negligence of Tenant or any of
Tenant's agents, employees or invitees, rent shall not be diminished or abated
while such damages are under repair, and Tenant shall be responsible for the
costs of repair not covered by insurance.
B. Landlord shall maintain fire and extended coverage insurance only on the
office space portion of the Leased Premises in such amounts as Landlord shall
deem appropriate. Tenant shall be responsible, at its expense, for fire and
extended coverage insurance on all of its personal property, including removable
trade fixtures, located in the Leased Premises. Tenant shall maintain fire and
extended coverage insurance covering, at its expense, all portions of the Leased
Premises not covered by the Landlord's coverage in this subsection.
C. Tenant and Landlord shall, each at its own expense, maintain a policy or
policies of comprehensive general liability insurance with respect to the
respective activities of each in the Property with the premiums thereon fully
paid on or before due date, issued by and binding upon some insurance company
approved by Landlord, such insurance to afford minimum protection of not less
than $1,000,000 combined single limit coverage of bodily injury, property
damage or combination thereof. Landlord shall be listed as an additional insured
on Tenant's policy or policies of comprehensive general liability insurance, and
Tenant shall provide Landlord with current Certificates of Insurance evidencing
Tenant's compliance with this Paragraph. Tenant shall obtain the agreement of
Tenant's insurers to notify Landlord that a policy is due to expire at least
(10) days prior to such expiration. Landlord shall not be required to maintain
insurance against thefts within the Leased Premises or the Property.
13. Utilities.
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Tenant shall pay all charges for water, sewer, gas, electricity, telephone and
other services and utilities used by Tenant on the Leased Premises during the
term of this Lease unless otherwise expressly agreed in writing by Landlord. In
the event that any utility or service provided to the Leased Premises is not
separately metered, Landlord shall pay the amount due and separately invoice
Tenant for Tenant's pro rata share of the charges. Tenant shall pay such amounts
within fifteen (15) days of invoice. Landlord hereby informs Tenant that
Landlord intends to connect the Property to Dayton City water and sewer service,
and Tenant agrees that, if required by the City of Dayton (or any other
government authority authorized to provide water or sewer service) Tenant will
connect to such service and shall pay all charges for water and sewer.
14. Signs.
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Following Landlord's consent, Tenant shall have the right to place on the Leased
Premises, at locations selected by Tenant, any signs which are permitted by
applicable zoning ordinances and private restrictions. Landlord may refuse
consent to any proposed signage that is in Landlord's opinion too large,
deceptive, unattractive or otherwise inconsistent with or inappropriate to the
Leased Premises or use of any other tenant. Landlord shall assist and cooperate
with Tenant in obtaining any necessary permission from governmental authorities
or adjoining owners and occupants for Tenant to place or construct the foregoing
signs. Tenant shall repair all damage to the Leased Premises resulting from the
removal of signs installed by Tenant.
15. Entry.
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Landlord shall have the right to enter upon the Leased Premises at reasonable
hours to inspect the same, provided Landlord shall not thereby unreasonably
interfere with Tenant's business on the Leased Premises.
16. Parking.
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During the term of this Lease, Tenant shall have the non-exclusive use in common
with Landlord, other tenants of the Property, their guests and invitees, of the
non-reserved common automobile parking areas, driveways, and footways, subject
to rules and regulations for the use thereof as prescribed from time to time by
Landlord. Landlord reserves the right to designate parking areas within the
Property or in reasonable proximity thereto, for Tenant and Tenant's agents and
employees.
17. Default.
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If default shall at any time be made by Tenant in the payment of rent when due
to Landlord as herein provided, and if said default shall continue for fifteen
(15) days after written notice thereof shall have been given to Tenant by
Landlord, or if default shall be made in any of the other covenants or
conditions to be kept, observed and performed by Tenant, and such default shall
continue for thirty (30) days after notice thereof in writing to Tenant by
Landlord without correction thereof then having been commenced and thereafter
diligently prosecuted, Landlord may declare the term of this Lease ended and
terminated by giving Tenant written notice of such intention, and if possession
of the Leased Premises is not surrendered, Landlord may reenter said premises.
Landlord shall have, in addition to the remedy above provided, any other right
or remedy available to Landlord on account of any Tenant default, either in law
or equity. Landlord shall use reasonable efforts to mitigate its damages.
18. Quiet Possession.
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Landlord covenants and warrants that upon performance by Tenant of its
obligations hereunder, Landlord will keep and maintain Tenant in exclusive,
quiet, peaceable and undisturbed and uninterrupted possession of the Leased
Premises during the term of this Lease.
19. Condemnation.
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If any legally, constituted authority condemns the Property or such part thereof
which shall make the Leased Premises unsuitable for leasing, this Lease shall
cease when the public authority takes possession, and Landlord and Tenant shall
account for rental as of that date. Such termination shall be without prejudice
to the rights of either party to recover compensation from the condemning
authority for any loss or damage caused by the condemnation. Neither party shall
have any rights in or to any award made to the other by the condemning
authority.
20. Subordination.
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Tenant accepts this Lease subject and subordinate to any mortgage, deed of trust
or other lien presently existing or hereafter arising upon the Leased Premises,
or upon the Property and to any renewals, refinancing and extensions thereof,
but Tenant agrees that any such mortgagee shall have the right at any time to
subordinate such mortgage, deed of trust or other lien to this Lease on such
terms and subject to such conditions as such mortgagee may deem appropriate in
its discretion. Landlord is hereby irrevocably vested with full power and
authority to subordinate this Lease to any mortgage, deed of trust or other lien
now existing or hereafter placed upon the Leased Premises of the Property, and
Tenant agrees upon demand to execute such further instruments subordinating this
Lease or attorning to the holder of any such liens as Landlord may request. In
the event that Tenant should fail to execute any instrument of subordination
herein require d to be executed by Tenant promptly as requested, Tenant hereby
irrevocably constitutes Landlord as its attorney-in-fact to execute such
instrument in Tenant's name, place and stead, it being agreed that such power is
one coupled with an interest. Tenant agrees that it will from time to time upon
request by Landlord execute and deliver to such persons as Landlord shall
request a statement in recordable form certifying 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 so modified), stating the dates to which rent and
other charges payable under this Lease have been paid, stating that Landlord is
not in default hereunder (or if Tenant alleges a default stating the nature of
such alleged default) and further stating such other matters as Landlord shall
reasonably require.
21. Notice.
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Any notice required or permitted under this Lease shall be deemed sufficiently
given or served if sent by United States certified mail, return receipt
requested, addressed as follows:
If to Landlord to:
Agribiofuels, LLC
0000 Xxxxx Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
If to Tenant to:
Xxxxxxx Xxxx, Inc.
X.X. Xxx 000
Xxxxxx, XX 00000
Landlord and Tenant shall each have the right from time to time to change the
place notice is to be given under this paragraph by written notice thereof to
the other party.
22. Brokers.
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Tenant represents that Tenant was not shown the Premises by any real estate
broker or agent and that Tenant has not otherwise engaged in, any activity which
could form the basis for a claim for real estate commission, brokerage fee,
finder's fee or other similar charge, in connection with this Lease.
23. Waiver.
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No waiver of any default of Landlord or Tenant hereunder shall be implied from
any omission to take any action on account of such default if such default
persists or is repeated, and no express waiver shall affect any default other
than the default specified in the express waiver and that only for the time and
to the extent therein stated. One or more waivers by Landlord or Tenant shall
not be construed as a waiver of a subsequent breach of the same covenant, term
or condition.
24. Headings.
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The headings used in this Lease are for convenience of the parties only and
shall not be considered in interpreting the meaning of any provision of this
Lease.
25. Successors.
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The provisions of this Lease shall extend to and be binding upon Landlord and
Tenant and their respective legal representatives, successors and assigns.
26. Performance.
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If there is a default with respect to any of Landlord's covenants, warranties or
representations under this Lease, and if the default continues more than fifteen
(15) days after notice in writing from Tenant to Landlord specifying the
default, Tenant may, at its option and without affecting any other remedy
hereunder, cure such default and deduct the cost thereof from the next accruing
installment or installments of rent payable hereunder until Tenant shall have
been fully reimbursed for such expenditures, together with interest thereon at a
rate equal to the lessor of twelve percent (12%) per annum or the then highest
lawful rate. If this Lease terminates prior to Tenant's receiving full
reimbursement, Landlord shall pay the unreimbursed balance plus accrued interest
to Tenant on demand.
27. Final Agreement.
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This Agreement terminates and supersedes all prior understandings or agreements
on the subject matter hereof. This Agreement may be modified only by a further
writing that is duly executed by both parties.
28. Governing Law.
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This Agreement shall be governed, construed and interpreted by, through and
under the Laws of the State of Texas.
IN WITNESS WHEREOF, the parties have executed this Lease as of the day and year
first above written.
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Agribiofuels, LLC
By:
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Title:
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[tenant]
By:
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Title:
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