EXHIBIT 10.1
LEASE AGREEMENT
BY THIS LEASE AGREEMENT (hereinafter, this "Lease"), made and entered into
this 26th day of January 2001, the parties hereto declare, covenant and agree
as follows:
1. Basic Lease Provisions.
The following terms are hereby defined as set forth below for purposes of
this Lease and shall be given such meanings wherever said terms appear in this
Lease unless the context requires otherwise, and subject to such adjustments,
restrictions and qualifications as are expressly set forth herein:
"Landlord": Xxxxxx Canning Company
000 00xx Xxxxxx, Xxxxx 000
Xxxxxx, XX 00000
"Tenant": Hoopeston Foods Denver Corp.
Xxx Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
"Premises": That certain real property (the "Property")
described on Exhibit "A" attached hereto, situated
in the City and County of Denver, Colorado,
together with all improvements presently located
thereon and all easements, appurtenances and
rights related thereto (hereinafter, the
"Premises"). The address of the Premises is 0000
Xxxx Xxxxxx, Xxxxxx, Xxxxxxxx. The Premises
contain manufacturing and warehouse facilities
thereon (all such facilities are collectively
referred to as the "Building").
"Monthly Rent": An amount equal to the Landlord's monthly
mortgage payment, as documented by Landlord to
Tenant's reasonable satisfaction. The amount of
Landlord's monthly mortgage payment as of the
Lease Commencement Date is $34,719.00.
"Commencement Date": January 26, 2001.
"Lease Term": An initial period of 5 years commencing on the
Commencement Date and terminating on the later of
(i) at 5:00 p.m. (Denver time) on January 26, 2006
and (ii) the expiration or termination of the
Co-Pack and Warehousing Agreement between the
parties; subject to the terms and conditions of
this Lease which may permit or provide for an
earlier termination or an extension of the term.
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2. Premises.
For and in consideration of the agreement of the Tenant to pay the Monthly
Rent and other sums provided for herein and to perform the terms, covenants,
and conditions on its part required hereunder, Landlord hereby leases the
Premises to Tenant and Tenant hereby leases the Premises from Landlord. Tenant
hereby affirmatively and expressly waives any implied warranties in connection
with the Premises and agrees to rely solely upon those representations and
warranties expressly set forth in this Lease.
3. Lease Term.
The Lease Term shall be for the period described in Article 1 hereof,
unless this Lease shall be terminated earlier as herein provided or extended
pursuant to Section 29 herein. All rents payable hereunder for a fractional
calendar month shall be prorated on a per diem basis, calculated on the basis
of a thirty (30) day month.
4. Consideration.
4.1 Commencing on the Commencement Date and continuing throughout the
Lease Term, Tenant agrees to pay to Landlord at such place as Landlord may
designate, without prior demand therefore, and without any deduction,
counterclaim or setoff, in lawful money of the United States of America:
(a) The Monthly Rent, in advance, on or before the first day of each
calendar month during the Lease Term. Upon execution of this Lease, Tenant
agrees to pay Landlord the Monthly Rent for the partial month of January 2001;
and
(b) All excise, sales, use, rental, and/or transaction privilege
taxes levied or imposed, or hereafter levied or imposed, against or on account
of any or all amounts payable hereunder by Tenant or the receipt thereof by
Landlord (except Landlord's income taxes), said taxes to be paid together with
the Monthly Rent, or as the Landlord may designate.
4.2 In addition to Monthly Rent, all other payments to be made by Tenant
under this Lease shall be deemed to be "Additional Rent" and shall be due and
payable upon demand if no other time for payment is specified. Landlord shall
have the same remedies for Tenant's failure to pay Additional Rent as for a
non-payment of other rent.
5. (Reserved)
6. Landlord's Expenses.
6.1 Tenant acknowledges and understands that this is a net, net, net
(triple net) lease (subject to the terms and conditions hereof) and, in
addition to paying all utilities, maintenance,
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repairs and other costs and expenses related to the Premises, Tenant hereby
agrees to reimburse Landlord for the amount of Landlord's Expenses (as such
term is defined in Section 6.5).
6.2 Such reimbursement shall be deemed to be Additional Rent hereunder
and shall be computed annually on a calendar year basis, but shall be estimated
by Landlord in writing based on historical costs (which costs shall also be
provided to Tenant in writing along with the aforementioned estimate of
Additional Rent) and collected from Tenant in advance on a monthly basis
together with the Monthly Rent. In the event the Lease Term commences after the
beginning of or terminates before the end of a calendar year, the amounts
payable by Tenant hereunder for such period(s) shall be adjusted
proportionately.
6.3 Unless delayed by causes beyond Landlord's control, not later than
May 31 of each year during the Lease Term and any Renewal Terms (and the year
immediately following expiration of the Lease Term or the final Renewal Term
hereunder), Landlord shall provide Tenant with a written statement (the "Annual
Statement of Additional Rent") certified by the chief financial officer of
Landlord or by Landlord's outside independent certified public accountant, to
be true, complete and accurate, with respect to such calendar year showing
Landlord's Expenses for such calendar year on a line-item basis, together with
a copy of the bills for Taxes paid or payable by Landlord during such calendar
year, and setting forth the amount by which the actual amount of Landlord's
Expenses differs from the amounts paid by Tenant pursuant to this Article 6.
Tenant shall immediately pay to Landlord any deficiency disclosed by such
statement, and any overpayment shall be credited against Tenant's subsequent
Additional Rent obligations (or shall be promptly refunded to Tenant if the
Lease Term shall have expired).
6.4 Within ninety (90) days following receipt of Landlord's Annual
Statement of Additional Rent, Tenant shall have the right to request an
inspection of Landlord's books and records pertaining to Taxes and the Annual
Statement of Additional Rent at Landlord's offices. Landlord shall promptly
permit Tenant access, during normal business hours, to said books and records
following any such request by Tenant, and within ninety (90) days after such
books and records are provided to Tenant, Tenant shall notify Landlord in
writing of any disputed items of Taxes or items on the Annual Statement of
Additional Rent. If the disputed items are not resolved between the parties
within thirty (30) day period following such period of review, the disputed
items shall be submitted to an independent certified public accountant selected
by the parties to render an opinion as to whether or not the disputed items may
properly be included in Additional Rent. The opinion of the independent
certified public accountant shall be binding upon the parties. The fees and
expenses of the accountant shall be borne by the parties adversely affected by
the decision.
6.5 For purposes hereof, "Landlord's Expenses" shall mean all operating
and other expenses of any kind or nature which are necessary, ordinary, or
customarily incurred in connection with the operation and maintenance of the
Premises as determined by Landlord. Landlord's Expenses shall be determined on
an accrual basis in accordance with generally accepted accounting principles
consistently applied and shall include, but not be limited to:
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(a) All real property taxes, assessments and similar government charges lawfully
levied against the Premises by any governmental or quasi-governmental authority.
The foregoing shall include any taxes, assessments, surcharges, or service or
other fees of a nature not presently in effect which shall hereafter be levied
on all or any portion of the Premises as a result of the use, ownership or
operation of the Premises or for any other reason, whether in lieu of or in
addition to, any current real estate taxes and assessments; provided, however,
in no event shall the term "taxes or assessments," as used herein, include any
net federal or state income taxes levied or assessed on Landlord, unless such
taxes are a specific substitute for real property taxes. Such term shall,
however, include gross taxes on rentals. Expenses incurred by Landlord for tax
consultants and in contesting the amount or validity of any such taxes or
assessments shall be included in such computations provided Landlord receives
the prior written approval of Tenant to such expenses, which approval shall not
be unreasonably withheld (all of the foregoing are collectively referred to
herein as the "Taxes"). "Assessment" shall include so called special
assessments, license tax, business license fee, business license tax, commercial
rental tax, levy, charge, penalty or tax, imposed by any authority having the
direct power to tax, including any city, county, state or federal government, or
any school, agricultural, lighting, water, drainage or other improvement or
special district thereof, against all or any portion of the Premises or any
legal or equitable interest of Landlord therein. In the case of Taxes or
Assessments which may be paid in installments over more than one year, only the
amount of the installment, plus any interest payable thereon, which would be due
and payable during a calendar year if such tax or assessment were timely paid in
the maximum permitted number of installments without penalty shall be included
in Taxes for that year, regardless of the manner in which Landlord actually pays
the Taxes. The following additional provisions shall also apply:
(i) Landlord shall timely pay all Taxes. Tenant shall not be responsible
for any penalties imposed in connection with any delay in payment of taxes
by Landlord to the appropriate governmental authority, except to the extent
of any penalty directly attributable to Tenant's failure to timely pay its
Additional Rent or other amounts due hereunder, but only for the period of
such delay after the date of the same are due to the taxing authority.
(ii) Tenant shall be solely responsible for, and shall timely pay, all
Taxes and Assessments levied or assessed against it or its personal
property located at the Premises.
(iii) Landlord shall deliver to Tenant a copy of each real estate tax
assessment notice relating to the Premises within ten (10) days after
Landlord's receipt hereof. Landlord may (but shall not be obligated) to
appeal or contest each assessment. Tenant reserves the right to participate
with Landlord in any such contests at Tenant's sole cost and expense. If
Landlord does not elect to appeal or contest such assessment, Tenant shall
have the right, at its sole cost and expense, to appeal or contest such
assessment. In such case, Landlord shall reasonably cooperate with Tenant
and supply to Tenant such information
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regarding the Premises requested by Tenant as would be relevant to
such contest.
(b) Costs of supplies, including, but not limited to, the cost of replacing the
bulbs for all lighting on the Premises as the same may be required from time to
time;
(c) Costs incurred in connection with obtaining and providing energy for the
Premises, including, but not limited to, costs of natural gas, electricity, and
fuel oils or any other energy sources;
(d) Costs of water and sanitary and storm drainage services;
(e) Costs of janitorial and security services, if any are provided;
(f) Costs of general maintenance and repairs, including costs under HVAC and
other mechanical maintenance contracts; and repairs and replacements of
equipment used in connection with such maintenance and repair work;
(g) Costs of maintenance of landscaping;
(h) Insurance premiums, including fire and all risk coverage, together with loss
of rent endorsement; the part of any claim required to be paid under the
deductible portion of any insurance policy carried by Landlord in connection
with the Premises (where Landlord is unable to obtain insurance without such
deductible from an insurance carrier at reasonable rates), public liability
insurance; and any other insurance carried by Landlord on the Premises or any
parts thereof (all such insurance shall be in such amounts as may be required by
any mortgagee of the Premises or as Landlord may reasonably determine);
(i) Upon prior written approval of Tenant (which approval shall not be
unreasonably withheld), legal, inspection, and other consultation fees
(including fees charged by consultants retained by Landlord for services that
are designed to produce a reduction in Landlord Expenses or to reasonably
improve the operation, maintenance or state of repair of the Premises incurred
in the ordinary course of operating the Premises); and costs incurred by
Landlord in engaging experts or other consultants to assist in making the
computations required hereunder;
(j) The costs of capital improvements and structural repairs and replacements
made in or to the Premises in order to conform to changes subsequent to the
lease Commencement Date in any applicable laws, ordinances, rules, regulations,
or orders of any governmental or quasi-governmental authority having
jurisdiction over the Premises (herein "Required Capital Improvements"); the
costs of any capital improvements and structural repairs and replacements
designed primarily to reduce Landlord Expenses (herein "Cost Savings
Improvements"). The expenditures for Required Capital Improvements and Cost
Savings Improvements shall be amortized at a market rate of return over the
useful life of such
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capital improvement or structural repair or replacement (as
determined by Landlord). Any actual payments made by Tenant to
Landlord or third party vendors or service providers for amounts
under this sub-paragraph (j) shall be applied as a credit against
the purchase price if Tenant elects to purchase the Premises
pursuant to its purchase option set forth herein.
7. Taxes on Personal Property.
Tenant shall pay, prior to delinquency, all taxes levied upon fixtures,
furnishings, equipment, and all other personal property belonging to Tenant and
placed on the Premises by Tenant. In the event any of Tenant's fixtures,
furnishings, equipment and other personal property shall be assessed and taxed
with Landlord's real property, Tenant shall pay to Landlord its share of such
taxes within ten (10) days after delivery to Tenant by Landlord of a statement
in writing setting forth the amount of such taxes applicable to Tenant's
property. When possible, Tenant shall cause said fixtures, furnishings,
equipment and other personal property to be assessed and billed separately from
the real property of Landlord.
8. Status of the Premises.
Landlord represents and warrants that the Premises complies with all
applicable laws, codes, statutes, standards, regulations and ordinances,
including the ADA, in effect as of the Commencement Date and that no notices
have been received of building code violations affecting the Premises which
have not been corrected. Landlord further acknowledges its continuing
responsibility to comply with all applicable laws, codes, statutes, standards,
regulations and ordinances and to cure, at Landlord's sole cost and expense,
all building code violations relating to the Premises, except for violations
arising from any work on or use of the Premises by Tenant which is materially
different from the use of the Premises by Landlord prior to the date of this
Lease. Except for the foregoing representation, Tenant hereby accepts the
Premises in their "AS IS" condition including any and all defects, latent or
otherwise, existing as of the Lease Commencement Date or the date that Tenant
takes possession of the Premises, whichever is earlier, subject to all
applicable zoning, municipal, county and state laws, ordinances and regulations
governing and regulating the use of the Premises, and any covenants or
restrictions of record, and accepts this Lease subject thereto and to all
matters disclosed thereby. Tenant acknowledges that neither Landlord nor any
agents, employees or representatives of Landlord has made any representation or
warranty as to the present or future suitability of the Premises for the
conduct of Tenant's business. Landlord shall have no construction obligations
whatsoever regarding tenant improvements for Tenant.
9. Alteration, Additions and Improvements.
9.1 Tenant may not improve, construct, remodel, reconstruct or alter
improvements, structures, and buildings on the Premises without the prior
written consent of Landlord, which consent may not be unreasonably withheld.
Any such work approved by Landlord shall be done in compliance with and
pursuant to plans, drawings and specifications first approved in writing by
Landlord, which approval may not be unreasonably withheld. Any material
modifications to
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any such plans, drawings and specifications shall also require the prior written
approval of Landlord, which approval may not be unreasonably withheld. Tenant
covenants that any such approved improvements, structures or buildings shall be
completed at its sole cost and expense and shall conform to all applicable
building codes, zoning and other governmental regulations and restrictions and
shall be constructed diligently, in a good and workmanlike manner, using only
new, high quality materials, and in full compliance with all governmental laws,
rules and regulations then relating thereto.
9.2 (a) Any alterations, additions or improvements to the Premises shall
be surrendered by Tenant as part of the Premises, without disturbance or
injury, upon the expiration or earlier termination of this Lease, unless
Landlord designates in writing that such alterations, additions or improvements
shall be removed by Tenant prior to the expiration or earlier termination of
the Lease. Tenant shall have the right to remove any personal property or trade
fixtures installed in the Premises by Tenant.
(b) In the event of any injury or damage to the Premises resulting
from the removal by Tenant of any alterations, additions, improvements,
fixtures, equipment or furnishings pursuant hereto, Tenant shall promptly
repair the same, at its sole cost and expense, in a good and workmanlike
manner. If Tenant fails to make such repairs prior to the expiration or earlier
termination of this Lease, Tenant shall pay to Landlord an amount sufficient
for Landlord to repair same or to compensate Landlord for such injury or damage
to the Premises.
9.3 Tenant shall keep the Building free from any liens arising from work
performed, materials furnished or obligations incurred by Tenant and shall
indemnify, hold harmless and defend Landlord for, from and against any liens and
encumbrances arising from any work performed or materials furnished by or at the
direction of Tenant, and for any costs and expenses incurred by Landlord in
connection therewith or arising as a result thereof. Prior to commencement of
any work on or at the Premises which could result in a mechanic's or
materialmen's lien against the Premises, Tenant shall provide Landlord with a
performance or surety bond or mechanic's lien waivers satisfactory to Landlord
in its sole and absolute discretion. Tenant shall pay, when due, all claims for
labor, professional services and materials furnished or alleged to have been
furnished or alleged to have been furnished to or for Tenant at or for use in
the Premises, which claims may be secured by any mechanic's or materialmen's
lien against the Premises or any interest therein. Tenant shall give Landlord
not less than thirty (30) days' notice prior to the commencement of any work in
the Premises, and Landlord shall have the right to post notices of
non-responsibility in or on the Premises as provided by law. If Tenant shall,
in good faith, contest the validity of any such claim or demand, then Tenant
shall, at its sole expense, defend itself and Landlord against the same and
shall pay and satisfy any adverse judgment that may be rendered thereon before
the enforcement thereof against the Landlord or the Premises, upon the
condition that if Landlord shall require, Tenant shall furnish to Landlord a
surety bond satisfactory to Landlord in an amount equal to such contested claim
or demand indemnifying Landlord against liability for the same and holding the
Premises free from the effect of any such judgment, claim or demand. In
addition, Landlord may require Tenant to pay Landlord's attorneys' fees and
costs in participating in such action if Landlord shall decide, in the exercise
of reasonable discretion, that it is in its best interest to do so.
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10. Use.
10.1 The Premises shall be used and occupied by Tenant only for operation
of a food production, canning, warehousing and distribution facility as
permitted by applicable zoning ordinances and shall not be used or occupied for
any other purposes whatsoever without obtaining the prior written consent of
Landlord, which consent may not be unreasonably withheld.
10.2 Tenant shall not do or permit anything to be done in or about the
Premises which will increase the existing rate of insurance upon the Premises,
or cause the cancellation of any insurance policy covering the Premises. Tenant
shall at its sole cost and expense promptly comply with all laws, statutes,
ordinances and governmental rules, regulations or requirements now in force or
which may hereafter be in force and with the requirements of any board of fire
underwriters or other similar body now or hereafter constituted relating to or
affecting the condition, use or occupancy of the Premises.
11. Environmental Matters.
11.1. Environmental Laws. The term "Environmental Laws" shall mean any
past, present or future federal, state or local laws, statutes, regulations,
rules, ordinances and policies relating to environmental matters and
contamination of any type whatsoever, including, without limitation, those
relating to: treatment, storage, disposal, generation or transportation of
Hazardous Materials (as hereinafter defined); spills, discharges, leaks,
emissions, escapes, dumping, or other releases or threatened releases
(individually, a "Release" and collectively, "Releases") or any Hazardous
Material into the environment, whether or not notification or reporting to any
federal, state or local agency was or is required; air, water or noise
pollution; surface or ground water contamination; the protection of natural
resources, wildlife, marine sanctuaries or wetlands; storage tanks, vessels and
related equipment; abandoned or discarded barrels, containers and other closed
receptacles; health and safety of employees and other persons; reporting or
notification regarding or relating to any Hazardous Material; and otherwise
relating to the manufacture, generation, reclaiming, recycling, presence,
processing, use, distribution, treatment, storage, disposal, transportation or
handling of any Hazardous Material.
11.2. Hazardous Material. The term "Hazardous Material" shall mean any
pollutant, contaminant, pesticide, radioactive substances, solid waste or
hazardous, extremely hazardous, dangerous or toxic waste, substance, chemical or
material within the meaning of any applicable Environmental Laws including,
without limitation, consent decrees, judicial decisions and administrative
orders, together with all amendments thereto and reauthorization thereof,
including, without limitation, any (i) "hazardous substance" as defined by the
Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) 42
U.S.C. section 9601, et seq., and all amendments thereto and reauthorizations
thereof, or section 311 of the Federal Water Pollution Control Act, 33 U.S.C.
section 1321; (ii) a "hazardous waste" as defined in the Resource Conservation
and Recovery Act ("RCRA"), 42 U.S.C. sections 6902, et seq., and all amendments
thereto and authorizations thereof; (iii) a "toxic pollutant" under section
307(a)(1) of the Federal
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Water Pollution Control Act, 33 U.S.C. Section 1317(a)(1); (iv) a "hazardous air
pollutant" under section 112 of the Clean Air Act, 42 U.S.C. Section 7412 et
seq., and all amendments thereto and reauthorizations thereof; (v) a "hazardous
material" under the Hazardous Materials Transportation Uniform Safety Act of
1990, 49 U.S.C. App. Section 1802, et seq., and all amendments thereto and
reauthorizations thereof or (vi) any other pollutant, contaminant, hazardous,
dangerous or toxic chemical material, waste or any other substance (including,
without limitation, petroleum and oil or any fraction thereof, asbestos and
PCBs) which may or could pose a hazard to the environment or the health and
safety of any occupant, user or third party at the Premises.
11.3 No Hazardous Material. Neither Landlord nor, to Landlord's
knowledge, any other person, has ever caused or permitted any Hazardous Material
to be placed, held, located or disposed of on, under or at the Premises or any
part of the Premises in violation of any Environmental Laws, nor has any part of
the Premises ever been used by Landlord, or to the best knowledge of Landlord,
by any other person as a permanent or temporary storage or disposal site for any
Hazardous Material. No Release of Hazardous Material has occurred on the
Premises to date in violation of any Environmental Laws, and the soil
groundwater and soil vapor on or under the Premises are free, in all material
respects, of Hazardous Material as of the date of this Lease.
11.4 No Violation. Neither Landlord nor, to Landlord's knowledge, any
other person, is in violation of any Environmental Laws with respect to the
Premises, and the Premises complies in all material respects with all applicable
Environmental Laws.
11.5 Tenant's Indemnity. Tenant shall indemnify, defend and hold Landlord
and its officers, directors, employees, agents, subsidiaries and other related
parties (collectively referred to herein as "Related Parties") harmless from and
against any and all claims incurred or suffered by or asserted against Landlord
or its Related Parties for, with respect to, or as a direct or indirect result
of any Release of Hazardous Material from, into, under or upon the Premises or
any adjoining land, atmosphere, watercourse, body of water or wetland, which
Release is caused by Tenant or its agents, employees or contractors.
11.6 Landlord's Indemnity. Landlord shall indemnify, defend and hold
Tenant and its Related Parties harmless from and against any and all claims
incurred or suffered by or asserted against Tenant or its Related Parties (i)
relating to a breach of any representation or warranty by Landlord with respect
to, or (ii) otherwise for, with respect to, or as a direct or indirect result
of: (1) any Hazardous Material which existed in, under or on the Premises on or
before the Commencement Date; or (2) any Release of Hazardous Material at any
time from, into, under or upon the Premises or any adjoining land, atmosphere,
watercourse, body of water or wetland, which Release is caused by Landlord, its
agents, employees or contractors.
11.7 Scope of Indemnification. If either party to this Lease is required
pursuant to this section to indemnify the other party or its Related Parties
against any claims, the obligations of the indemnifying party shall include,
without limitation, indemnity claims arising during or after the Term out of or
in any way relating to the Hazardous Material at issue for which the
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indemnifying party is responsible hereunder, including, without limitations;
(1) all costs incurred by the indemnified party in connection with any
investigation of site conditions or any cleanup, remedial or restoration
required by any federal, state or local governmental authority or other third
party because of the presence of the Hazardous Material at issue; (2) all sums
paid in settlements of claims; (3) reasonable attorneys' fees; and (4)
consultants' and other experts' fees. Furthermore, if any investigation, site
monitoring, containment, cleanup, removal, restoration or other remedial work of
any kind (collectively, "Remedial Work") is required under any applicable
Environmental Laws or by any governmental entity or third party because of the
Hazardous Material at issue for which the indemnifying party is responsible
hereunder, the indemnifying party shall assume all responsibility to have all
such Remedial Work performed, at the indemnifying party's sole expense.
Furthermore, if any oral or written notice of any kind is required by any
applicable Environmental Law to be given or sent to, or filed with, any
governmental entity or third party because of the Hazardous Material at issue
for which the indemnifying party is responsible hereunder, the indemnifying
party shall assume all responsibility to have all such notice(s) given, sent or
filed, at the indemnifying party's sole expense, within the time limits
prescribed by all applicable Environmental Laws.
11.8 Notice to Indemnified Party. Whenever either party to this Lease has
reason to believe that such party may be required, pursuant to the foregoing
provisions of this Article, to indemnify the other party to this Lease, the
potential indemnifying party shall, within 24 hours after first becoming aware
of such information, give the potential indemnified party oral notice (to be
confirmed in writing within ten (10) business days) adequately describing the
basis for the Indemnifying Party's actual or potential liability to the
indemnified party. Such notice shall describe, without limitation (1) the
Hazardous Material at issue; (2) the known or suspected manner in which the
Hazardous Material at issue was Released; (3) all actions, if any, of the
indemnifying party to comply with any applicable Environmental Laws with respect
to the Hazardous Material at issue; (4) all past, present or future inspections,
if any, of the Premises by any governmental entities with respect to the
Hazardous Material at issue; (5) all notices, orders, fines or communications,
if any, from any governmental entity or third party that relate to the Hazardous
Material at issue; (6) all notices or communications, if any, from the
indemnifying party to any governmental entity or other third party that relate
to the Hazardous Material at issue; and (7) all responses or Remedial Work, if
any, made or undertaken (or proposed to be made or undertaken) by any
governmental entity or third party with respect to the Hazardous Material at
issue.
11.9 Survival. The provisions of and undertakings set out in this Article,
and all indemnifications contained in this Lease, shall survive the termination
of this Lease.
12. Insurance.
12.1 (a) During the entire Lease Term, Tenant shall, at its sole cost and
expense, procure and maintain: (i) comprehensive general public liability
insurance against claims for personal injury, death and property damage
occurring upon, in or about the Premises and the Building, with a combined
single limit of not less than $3,000,000.00; and (ii) fire and extended
coverage, vandalism, malicious mischief, and special extended perils (all risk)
insurance in an
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amount not less than the full cost of replacement of all of Tenant's personal
property, inventory, decorations, trade fixtures, furnishings, equipment and
other contents in the Premises.
(b) All such policies of insurance shall name both Landlord and
Tenant as insureds (and/or the mortgages of Landlord if Landlord so requires)
and shall be issued by insurance carriers acceptable to Landlord. Tenant agrees
to furnish Landlord, on or before the Commencement Date, with certificates of
insurance showing that insurance meeting the requirements hereof has been
obtained and paid at least six (6) months in advance by Tenant, and Tenant
shall obtain a written commitment from each insurance carrier to notify
Landlord in writing at least thirty (30) days prior to any cancellation or
modification thereof.
12.2 Notwithstanding the provisions of this Article 12, Tenant hereby
waives any and all rights of recovery against Landlord, or against the
officers, employees, agents and representatives of Landlord, for loss of or
damage to Tenant or its property or the property of others under its control to
the extent that such loss or damage is insured against under any insurance
policy in force at the time of such loss or damage, but only to the extent of
insurance proceeds actually received. Tenant shall, upon obtaining the policies
of insurance required hereunder, give notice to the insurance carrier or
carriers that the foregoing waiver of subrogation is contained in this Lease.
13. Utilities Charges.
To the extent not included in Landlord Expenses and Additional Rent under
Section 6, Tenant shall pay or cause to be paid, when due and prior to
delinquency, any and all charges for water, gas, electricity, telephone
service, sewage service, garbage service and any other utilities used in or
upon the Premises during the term of this Lease and agrees not to permit any
charges of any kind to accumulate or become a lien against the Premises.
14. Maintenance and Repair.
To the extent not included in Landlord Expenses and Additional Rent under
Section 6, during the term of this Lease, Tenant, at Tenant's sole cost and
expense, shall keep the structures and buildings constructed on the Premises
and any other improvements (including without limitation, cold storage units,
landscaping, wiring, plumbing, structural components, roof, plate glass doors,
windows, parking lot, fences, HVAC, interior and exterior painting) located
from time to time thereon in an attractive, good and safe condition and state
of repair, and will hold Landlord free and harmless of and from any and all
expense and liability therefor.
15. Liabilities.
15.1 Tenant shall indemnify and hold Landlord harmless for, from and
against any and all claims, damages and liabilities arising from Tenant's use
of the Premises or the conduct of its business or from any activity engaged in
or permitted by Tenant on or about the Premises, and shall further indemnify
and hold Landlord harmless for, from and against any and all claims, damages or
liabilities arising from any breach or default in the performance of any
obligation of
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Tenant under this Lease or arising from any act or negligence of Tenant, or of
its employees, agents, contractors or invitees and from all costs, reasonable
attorneys' fees, expenses and liabilities incurred by Landlord as a result of
any such claim, liability or action or proceeding. The foregoing shall not be
deemed to release or waive any of Tenant's rights or remedies against Landlord
for damage or injuries caused to persons or property resulting from Landlord's
gross negligence or willful misconduct, or that of Landlord's employees,
agents, or contractors, or Landlord's breach or default in the performance of
any of its obligations under this Lease.
15.2 Landlord shall not be liable for injury to Tenant's business or loss
of income therefrom or for damage that may be sustained by the person or
property of Tenant, caused by or resulting from fire, steam, electricity, gas,
water or rain, which may leak or flow from or into any part of the Premises, or
from the breakage, leakage, obstruction or other defects of the pipes,
sprinklers, wires, appliances, plumbing, air conditioning, lighting fixtures or
other equipment located in the Building. Tenant shall give immediate notice to
Landlord in the event of fire or accident to or defect in the Premises or any
of its fixtures, appurtenances or equipment, and shall cooperate with Landlord
and the insurance carrier in processing any insurance claim.
15.3 Landlord's liability for loss resulting from its failure, by
negligence or otherwise, to comply with any federal, state or local laws,
ordinances or regulations shall be and hereby is expressly limited to the costs
of remedying, repairing, replacing or removing any objects, hazards or
structures deemed to be in violation of any such laws, ordinances or
regulations, and Landlord shall not be liable for any other incidental or
consequential damages suffered or incurred by Tenant as a result thereof.
Landlord shall have a reasonable time after receiving written notice of any
such violation from Tenant or any other party (but not longer than 60 days) to
remedy such violation. The existence of any such violation shall not constitute
grounds for constructive eviction or breach of any implied or express warranty,
so long as Landlord cures such violation within a reasonable time after
Landlord's receipt of written notice from Tenant specifying the nature of such
violation. To the extent any such violations prevent Tenant for using all or
substantially all of the Premises, the Monthly Rate shall xxxxx for the period
of time Tenant is unable to use the Premises.
16. Damage or Destruction.
16.1 In the event all or substantially all of the Building and/or the
Premises are destroyed by fire or any other casualty so as to become
untenantable, either Landlord or Tenant may elect to terminate this Lease as of
the date of such damage or destruction, by notice to the other within thirty
(30) days thereafter (provided, however, that Tenant may not terminate the
Lease if the damage to the Building or Premises was caused by Tenant or any of
Tenant's invitees). In the event Landlord reasonably determines that it cannot
repair or restore any damage or destruction of the Premises within one hundred
twenty (120) days after such damage or destruction occurs, then Landlord shall
promptly notify Tenant of the same and Tenant may elect to terminate this Lease
by notice to Landlord not later than ten (10) days after receipt of such notice
from Landlord. In the event neither party elects to terminate this Lease in
accordance with the applicable provisions hereof, Landlord shall promptly
repair or rebuild the Building and/or Premises out of the insurance proceeds.
In the event Landlord fails to substantially complete
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such repair or rebuilding within one hundred twenty (120) days after such
damage or destruction occurs (extended for delays due to causes beyond the
control of Landlord as set forth in Article 27 of this Lease), then either
party may thereupon terminate this Lease by notice to the other party not later
than ten (10) days after expiration of said one hundred twenty (120) day period
or extension thereof. In connection with any repair or rebuilding of the
Premises, should there be a substantial interference with Tenant's use of the
Premises, Tenant shall be entitled to a proportionate reduction of Monthly Rent
and Additional Rent and Taxes while such repairs are being made based upon the
rentable area of the Premises that is not available to Tenant during the course
of such repairs or, in the case where the damage or destruction renders the
Premises untenantable or unusable for Tenant's business, there shall be a total
abatement of Rent, Additional Rent and Taxes during the period of time that the
Premises are untenantable or unusable for Tenant's business; provided, however,
that rent shall not xxxxx if such damage was caused by Tenant, its agents,
employees or invitees.
16.2 Notwithstanding anything contained herein to the contrary, in the
event the holder of any indebtedness secured by a mortgage or deed of trust
covering the Premises requires that the insurance proceeds be applied to such
indebtedness, then Landlord shall have the right to terminate this Lease by
delivering written notice of termination to Tenant, whereupon all rights and
obligations hereunder shall cease and terminate. No damages, compensation or
claim shall be payable by Landlord to Tenant for inconvenience, loss of
business or annoyance from any repair or rebuilding of any portion of the
Building or from the termination of this Lease pursuant to this Article 16.
17. Condemnation.
If all or any part of the Premises shall be taken for public or
quasi-public use under any governmental law, ordinance or regulation, or by
right of eminent domain, or consent to sale in lieu thereof, and such taking
renders the Premises untenantable or unusable for Tenant's business, this Lease
shall terminate as of the date of transfer of possession of the Premises, and
Tenant shall have no claim against Landlord for the value of any unexpired
term of this Lease. All compensation or damages awarded for such taking or
transfer shall belong to and be the property of Landlord, except for any
specific award to Tenant for fixtures and improvements installed by Tenant at
its sole expense. Within fifteen (15) days of Landlord's receipt, Landlord
shall give Tenant copies of any notice received by Landlord in connection with
any pending or threatened condemnation proceeding or sale in lieu thereof.
18. Sale by Landlord; Option to Purchase by Tenant.
18.1 Sale by Landlord.
Subject to Tenant's option to purchase the Premises described herein,
Landlord may sell, transfer, assign or otherwise dispose of the Premises, the
Building, or this Lease, or any part thereof or interest therein, subject to the
terms and conditions of this Lease. Upon any such sale, transfer, assignment
or disposal of all of its interest in the Premises or this Lease, Landlord
shall be automatically relieved of all obligations hereunder on the condition
that Landlord's successor-
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in-interest shall expressly assume such obligations. Provided that Tenant is
not then in default under this Lease, this Lease shall not be affected by any
such sale, transfer, assignment or disposal of Landlord's interest, and Tenant
agrees to attorn to Landlord's purchaser or assignee.
18.2 Option to Purchase by Tenant.
(a) Tenant shall have the option to purchase the Premises for a purchase
price equal to the fair market value of the Premises as determined in
accordance with the following procedures (the "Purchase Option"). Following
receipt by Landlord of a written notice from Tenant that it is exercising the
Purchase Option, Tenant and Landlord shall each appoint one independent,
qualified real estate appraiser and instruct the appointed appraiser to appraise
the Premises using the following three methods: (i) the replacement cost
method, (ii) the income capitalization method using fair market value rent for
the Premises and (iii) the comparable sales method. The appraisers shall
indicate a separate valuation for each of the three methods. Of the six
valuations from the appraisers (three from each appraiser), the highest and
lowest values shall be discarded and the remaining four shall be averaged. The
average of the remaining four shall be the fair value of the Premises for
purposes of Tenant's Purchase Option and is hereinafter referred to the
"Purchase Price." Notwithstanding the foregoing, in no event shall the Purchase
Price under this section be less than $5,500,000, unless otherwise agreed to by
the parties hereto.
(b) The Purchase Option shall be exercisable at any time during the Term
and any Option Term of this Lease. Tenant's right to exercise the Purchase
Option shall be subject to the conditions that at the time of the exercise of
the Purchase Option this Lease shall be in full force and effect and no
material Default on the part of Tenant shall exist under this Lease.
(c) Within thirty (30) days following exercise of the Purchase Option, the
parties shall enter into a contract providing for, among other things,
prorating rentals to date of closing; supplying of owner's title insurance to
Tenant by Landlord in the amount of the Purchase Price, subject only to
encumbrances of a definite or ascertainable amount which can be removed by the
payment of a portion of the proceeds of sale at the time of closing and other
exceptions acceptable to Tenant, and with extended coverage over all general
exceptions; supplying of a satisfactory current survey of the Premises to
Tenant by Landlord; conveyance of the Premises by general warranty or trustee's
deed, with transfer taxes paid by Landlord (unless applicable law places
responsibility for such taxes on purchasers), and xxxx of sale; assignment to
Tenant by Landlord and delivery to Tenant of all leases, licenses, permits and,
at Tenant's option, contracts relating to the Premises; delivery to Tenant by
Landlord of all plans, studies and other documents relating to the Premises;
and other customary provisions for the sale of similar property in the county
where the Premises is located. Tenant shall pay the Purchase Price by wire
transfer at the closing, which will take place thirty (30) days after the date
of execution of the contract.
19. Assignment and Subletting.
19.1 Tenant shall not assign, transfer, mortgage, pledge, hypothecate or
encumber this Lease, or any interest therein, or sublet the Premises, or any
portion thereof, without first obtaining the written consent of Landlord, which
consent shall not be unreasonably withheld.
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19.2 Any consent obtained hereunder to one such assignment, subletting,
occupation, or use by any other person shall not be deemed to be a consent to
any subsequent assignment, subletting, occupation or use by another person, nor
shall such consent be deemed a waiver by Landlord of Landlord's right to
withhold its consent as provided hereunder as to any subsequent assignment,
subletting, occupation or use by another person.
19.3 Any assignment or subletting permitted hereunder shall expressly
provide, and shall be permitted solely upon the condition that, the assignee or
sublessee, as the case may be, shall be fully bound to Landlord, its successors
or assigns, by full privity of contract, as well as by privity of estate; and
that each such assignee or sublessee shall be fully bound to perform all
covenants of this Lease; and that no such assignment, subletting, occupation or
use nor any subsequent assignment, subletting, occupation or use shall relieve
Tenant or any prior or earlier assignee or sublessee of its contractual
obligations as described herein to Landlord.
19.4 Any assignment, subletting, transfer, mortgage, pledge, hypothecation
or encumbrance of this Lease, without the consent required and described herein
shall be void, and, not voidable.
20. Estoppel Certificate.
20.1 Tenant shall within ten (10) business days following Tenant's receipt
of any written request from Landlord, execute, acknowledge and deliver to
Landlord a written statement certifying: (a) that this Lease is in full force
and effect and stating the nature of any modification hereto; (b) the dates to
which the rentals and other charges are paid in advance, if any; (c) that there
are not, to Tenant's knowledge, any defaults on the part of Landlord hereunder,
or specifying such defaults if they are claimed; and (d) such other matters as
may reasonably be requested by Landlord. Tenant acknowledges that any such
statement may be relied upon by any prospective purchaser or encumbrancer of all
or any portion of the Premises. Tenant's failure to deliver such statement
within such time shall be conclusive upon Tenant (i) that this Lease is in full
force and effect, without modification except as may be represented by Landlord,
(ii) that there are no uncured defaults in Landlord's performance, and (iii)
that not more than one month's rent has been paid in advance.
20.2 Prior to the execution date of this Lease and at any time during the
term of this Lease, Tenant agrees to deliver to Landlord or to any lender or
prospective purchaser of the Premises designated by Landlord promptly upon
demand therefor, such financial statements of Tenant, certified by Tenant to be
true and correct, as may be reasonably required by Landlord, or such lender or
prospective purchaser of the Building, to be received in confidence and used
only for the purpose of evaluating Tenant's financial condition.
21. Default.
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21.1 (a) If Tenant should fail to pay with ten (10) days after the date
set for payment under this Lease, any part of the rentals herein provided, or
any other sum required by this Lease to be paid to Tenant, without notice from
Landlord; or (b) if default should be made in any of the nonmonetary covenants,
terms or provisions to be performed by Tenant hereunder and such nonmonetary
default should continue for a period of ten (10) days following written notice
thereof from Landlord to Tenant (provided, however, that if the nature of
Tenant's nonmonetary default is such that more than ten (10) days are required
for performance, then Tenant shall not be in default hereunder if Tenant
commences performance within such ten (10) day period and thereafter diligently
prosecutes the same to completion); or (c) should Tenant's interest herein be
terminated or assigned by operation of law, or otherwise, including, without
limitation, the filing of a petition by or against Tenant (or any member of
Tenant if Tenant is a partnership or joint venture) under any insolvency or
bankruptcy act (provided, however, if a petition is filed against Tenant, Tenant
shall have a period of thirty (30) days within which to have such action
dismissed); or (d) should Tenant make a general assignment for the benefit of
creditors; or (e) the failure to timely perform (after the expiration of any
applicable cure periods) any covenant, condition, or obligation to be performed
by Lessee under the other agreements with Lessor and set forth on Schedule 1
hereto, then Landlord, in addition to any other rights and remedies it may have
hereunder or at law or in equity, shall have the right without any further
demand or notice, to pursue any one or more of the following remedies:
(i) exercise any rights or remedies available pursuant to this Lease
or applicable laws;
(ii) terminate this Lease by written notice to Tenant, in which event
Tenant shall have no further interest in this Lease or in the Premises, and
Landlord may recover from Tenant all damages Landlord may incur by reason of
Tenant's breach, including the cost of recovering the Premises, reasonable
attorneys' fees, and the value at the time of such termination of the then
reasonable rental value of the Premises for the remainder of the Lease Term;
(iv) xxx for all rent or any other sums due or to become due Landlord
under this Lease;
(v) render such performance required of Tenant, other than the payment
of Monthly Rent, and charge all costs and expenses incurred in connection
therewith to Tenant, and all amounts so charged shall be due and payable
immediately to Landlord upon presentment of a statement to Tenant indicating the
amount and nature of such costs or expenses; and
(vi) without termination of this Lease, relet the Premises or any part
thereof, as agent and for the account of Tenant, upon such terms and conditions
as Landlord, in its sole and absolute discretion, may deem advisable, with the
right to make reasonable alterations and repairs to the Premises necessary to
enable Landlord to relet the Premises, the expenses of which shall constitute an
indebtedness from Tenant to Landlord, and shall be immediately due and payable.
Any rents actually received by Landlord as a result of any such reletting shall
be applied by Landlord to rents, late fees, costs of reletting and any other
costs, fees or expenses payable by Tenant pursuant hereto, in such order as
Landlord shall determine,
16
in Landlord's sole and absolute discretion. If the rents to be received from
such reletting are less than the rent and other amounts to be paid by Tenant
hereunder, Tenant shall pay any such deficiency to Landlord, and Landlord may
bring an action therefor.
No re-entry or taking possession of the Premises by Landlord pursuant to the
terms of this Article 21 shall be construed as an election on its part to
terminate this Lease unless a written notice of such intention be given to
Tenant or unless the termination thereof be decreed by a court of competent
jurisdiction. Notwithstanding any reletting without termination, Landlord may
at any time thereafter, elect to terminate this Lease for such previous breach.
21.2 In the event Landlord shall fail to receive any installment of rent
or any other sum due hereunder within ten (10) days after the same shall be due
and payable, without notice from Landlord, Tenant shall pay to Landlord a late
charge in an amount equal to ten percent (10%) of such payment. The provision
for such late charge shall be in addition to all of Landlord's other rights and
remedies hereunder or at law, and shall not be construed as liquidated damages
or as limiting Landlord's remedies in any manner.
21.3 No act or conduct of Landlord, whether consisting of the acceptance
of the keys to the Premises, or otherwise, shall be deemed to be or constitute
an acceptance of the surrender of the Premises by Landlord prior to the
expiration of the Lease Term, and such acceptance by Landlord of surrender by
Tenant shall only be effected, and must be evidenced, by written acknowledgment
of acceptance of surrender signed by Landlord.
21.4 In the event the Premises is relet by Landlord after default by
Tenant at a rental which exceeds that owing from Tenant herein (including all
costs associated with such reletting and any other costs and expenses payable
by Tenant pursuant hereto), Tenant expressly states and agrees that Tenant, its
successors, assigns and representatives have no claim to or interest in any
excess rent.
22. Access by Landlord.
Landlord and Landlord's agents and representatives shall have the right to
enter into and upon the Premises at all reasonable times, including before or
after usual business hours, for the purpose of inspecting the Premises, making
repairs thereto, maintaining or adding any services to be provided by Landlord
or Tenant hereunder, showing the Premises to prospective purchasers or for any
other lawful purpose. In addition, Landlord reserves the right, during the last
six (6) months of the Lease Term, to enter the Premises or have its agents or
representatives enter the Premises during normal business hours for the purpose
of showing the Premises to prospective tenants, and to place on or about the
Premises or the Building appropriate signs or banners indicating that the
Premises are available for lease.
23. Subordination and Attornment.
This Lease shall be subordinate to any ground lease or other underlying
leasehold interest and to the lien of any mortgage or deed of trust heretofore
or hereafter placed upon the Premises
17
or the Building, to any and all advances made or to be made thereunder, to the
interest on the obligations secured thereby, and to all renewals, replacements
and extensions thereof; provided, however, that in the event any proceedings
are brought for default under any such ground or underlying lease, or in the
event of foreclosure or the exercise of the power of sale under any such
mortgage or deed of trust, Tenant shall attorn to the purchaser of the Premises
at such foreclosure or sale and recognize such purchaser as landlord under this
Lease, provided such purchaser expressly agrees in writing to be bound by the
terms of this Lease. If any mortgagee or beneficiary elects to have this Lease
superior to its mortgage or deed of trust and gives notice of such election to
Tenant, then this Lease shall thereupon become superior to the lien of such
mortgage or deed of trust. Tenant covenants and agrees to execute and deliver
upon demand without charge therefor, such further instruments evidencing
subordination of this Lease to such ground or underlying leases and to the lien
of any such mortgages or deeds of trust as may be required by Landlord or the
purchaser of the Premises, provided that such lienholder agrees in writing not
to disturb Tenant's use and possession of the Premises as long as Tenant shall
not be in default hereunder and provided further that Tenant shall agree to
attorn to any such lienholder.
24. Surrender of Premises and Holding Over.
Except as hereinafter provided, upon the expiration or earlier termination
of this Lease, Tenant shall quit and surrender the Premises, in good condition
and repair (reasonable wear and tear excepted). If the Premises are not
surrendered at the end of the Lease Term, Tenant shall indemnify Landlord for,
from and against any loss or liability resulting from delay by Tenant in so
surrendering the Premises, including without limitation, any claims made by any
succeeding tenant based on such delay. If Tenant or any successor in interest of
Tenant, should remain in possession of the Premises after the expiration of the
Lease Term without executing a new lease, then such holding over shall be
construed as a tenancy from month to month, subject to all the covenants, terms,
provisions and obligations of this Lease except Monthly Rent, which shall be
subject to an automatic increase of fifty percent (50%) over and above the
amounts paid in the last full calendar month of the Lease Term, as "Monthly
Rent" together with all other sums owing to Landlord hereunder. Nothing
contained herein shall be construed as Landlord's permission for Tenant to hold
over or as limiting Landlord's remedies against a holdover tenant. All keys
shall be returned to the Landlord upon surrender; failure of Tenant to return
all keys shall obligate Tenant to pay all necessary costs in rekeying the locks
pertaining to the Premises.
25. Quiet Enjoyment.
Landlord agrees that, upon compliance by Tenant with the terms and
conditions of this Lease, Tenant shall and may peaceably and quietly have,
hold and enjoy the Premises for the Lease Term subject to the terms and
provisions of this Lease. This covenant shall not extend to, and Landlord shall
not be liable for, any disturbance, act or condition permitted to be taken by
or on behalf of Landlord under this Lease.
26. Signs and Lighting.
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26.1 Tenant shall not erect or place any sign, lettering or design which
is visible from the exterior of the Building or of the Premises, without
Landlord's express written approval, which approval shall not be unreasonably
withheld. Any sign approved by Landlord must comply with all zoning ordinances
of the City and County of Denver and with all other applicable laws, ordinances
or regulations of any governmental authority having jurisdiction over the
Premises. Tenant shall be solely responsible for all fees, costs and expenses in
connection with obtaining any such approvals or permits required in connection
with the installation and maintenance of any such sign.
26.2 Tenant shall not install any exterior lighting on the Premises
without Landlord's prior written approval, which approval shall not be
unreasonably withheld.
27. Force Majeure.
If either party hereto shall be delayed or prevented from the performance
of any act required hereunder by reason of acts of God, strikes, lockouts, labor
disputes, civil disorder, inability to procure materials, restrictive
governmental laws or regulations or other cause without fault and beyond the
control of the party obligated (financial ability excepted), performance of such
act shall be excused for the period of delay; provided, however, nothing in this
Article 27 shall excuse Tenant from the prompt payment of any rental or other
charge required of Tenant hereunder except as may be expressly provided
elsewhere in this Lease.
28. Landlord's Exculpation.
In the event of default, breach, or violation by Landlord (which term
includes the trustee or trustees of Landlord, Landlord's partners, co-venturers,
co-tenants, officers, directors, employees, agents, or representatives) of any
of Landlord's obligations under this Lease, Landlord's liability to Tenant shall
be limited to its equity ownership interest in the Premises (or its interest in
the improvements, if applicable) or the proceeds of a public sale of such
interest pursuant to the foreclosure of a judgment against Landlord. Landlord
may, at its sole option, and among its other alternatives, relieve itself of all
liability under the Lease by conveying the Premises to Tenant, subject to all
existing liens on the Premises.
29. Option to Extend
As additional consideration for the covenants of Tenant hereunder, Landlord
hereby grants to Tenant an option (the "Option") to extend the Lease Term for
one (1) additional term of the longer of five (5) years or the date on which the
Co-Pack and Warehousing Agreement between the parties hereto expires or is
terminated pursuant to its terms (the "Option Term"). The Option shall apply
only to the original Premises leased hereunder and shall be on the following
terms and conditions:
(a) Written notice of Tenant's exercising of the Option shall be given to
Landlord no later than twelve (12) months prior to the expiration of the
initial five year Lease Term.
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(b) If Tenant timely exercises the Option, the Lease shall be deemed
extended.
(c) Unless Landlord is timely notified by Tenant in accordance with
subparagraph (a) above, it shall be conclusively deemed that Tenant does
not desire to exercise the Option, and the Lease shall expire in accordance
with its terms, at the end of the initial five year Lease Term.
(d) Tenant's right to exercise its Option shall be conditioned on Tenant
not being in default under the Lease at the time of exercise of the Option
or at the time of the commencement of the Option Term.
(e) The Option granted hereunder shall be upon the terms and conditions
(including rental rates) contained in the Lease except that there shall be
no further option to extend the term of the Lease beyond the Option Term.
30. Termination by Tenant.
Tenant may, at its sole option, terminate this Lease in the event any one
of the following shall occur ("Tenant Termination Event"):
(a) the breach by Landlord of any of the agreements set forth on Schedule
1 hereto and the failure to cure such breach within 30 days after receipt of
written notice from Tenant describing in detail such breach (if Landlord is
diligently attempting to cure the breach and the nature of the breach requires
longer than 30 days to cure, the cure period shall be extended to allow a
reasonable additional period of time to cure the breach); and
(b) the sale of the Premises by Landlord to a third party.
31. Miscellaneous.
31.1 All notices, demands and communications of any kind which either party
to this Lease may be required or desires to serve upon the other shall be in
writing and served to Landlord and to Tenant by personal service or by leaving a
copy of such notice, demand or communication at the appropriate address
indicated in Article 1 hereof, whereupon such service shall be deemed complete,
or by mailing a copy thereof by certified or registered mail, return receipt
requested, with such service being deemed to be complete on the day of actual
delivery as shown by the addressee's receipt or at the expiration of the third
day of mailing, whichever first occurs. Either party may change its address or
may designate additional parties who shall be entitled to notice hereunder from
time to time by giving written notice to the other.
31.2 This Lease shall be construed in accordance with and governed by the
laws of the State of Colorado. Any term or provision of this Lease which now or
hereafter is declared contrary to any law, order, ordinance or requirement of
any governmental authority, whether now in force or enacted or promulgated in
the future, or which is otherwise invalid, shall be deemed stricken from this
Lease without impairing the validity of the remainder of this Lease.
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31.3 Time is of the essence of this Lease. Subject to Article 19 hereof,
the terms and provisions hereof shall be binding upon and inure to the benefit
of the heirs, executors, administrators, successors, and assigns of the parties
hereto. If Tenant shall be more than one party, then the obligations imposed
upon Tenant hereunder shall be joint and several.
31.4 All rights and remedies of Landlord under this Lease shall be
cumulative and none shall exclude any other rights and remedies allowed by law.
No delay or omission of either party to exercise any right or power arising
from any default shall impair any such right or power, or shall be construed to
be a waiver of any such default or an acquiescence therein. No waiver by either
party of the breach of any covenant of this Lease by the other party shall be
construed as a waiver of any preceding or succeeding breach of the same or any
other covenant or condition of this Lease, nor shall the acceptance of rent be
deemed to be a waiver of such default by Landlord, other than a default arising
from the payment of the rent accepted by Landlord.
31.5 The captions appearing herein are for convenience only and are not a
part of this Lease nor do they limit or amplify any term or provision herein.
The terms and provisions hereof shall apply without regard to the number or
gender of words and expressions used herein.
31.6 This Lease contains the entire understanding and agreement of the
parties hereto with respect to all matters referred to herein, and all prior
negotiations and understandings are superseded hereby and merged into this
Lease. No party hereto shall be liable or bound to any other party in any
manner or by any agreement, warranty, representation or guarantee except as
specifically set forth herein. This Lease may be amended or modified only by a
written instrument signed by the parties hereto.
31.7 The relationship of the parties hereto is solely that of landlord and
tenant and under no circumstances shall one party be considered as partner,
joint venturer, or agent of the other.
31.8 Except as otherwise provided herein, any monies due from Tenant to
Landlord hereunder which are not paid within ten (10) days after the same shall
be due and payable shall bear interest at the rate of eighteen percent (18%)
per annum from and after such date until paid, but the payment of such interest
shall not excuse or cure any default by Tenant under this Lease. The acceptance
or endorsement by Landlord of any payment or check from Tenant shall be not
deemed an accord and satisfaction and shall not prejudice Landlord's right to
recover the balance of any amounts due under the terms of this Lease, unless
otherwise expressly agreed by Landlord in writing.
31.9 In the event of any legal action or proceeding brought by either
party hereto against the other arising out of this Lease, the prevailing party
shall be entitled to recover its actual attorneys' fees incurred in such legal
action or proceeding and such attorneys' fees shall be included in any judgment
rendered, as determined by the Court and not the jury, together with such
party's costs and other chargeable expenses. In addition, if any person shall
institute an
21
action against Tenant or Landlord in which the other is involuntarily and
without cause made a party defendant, the party whose acts, failure to act or
alleged acts gave rise to the action, shall indemnify, defend and save the other
harmless for, from and against all liability by reason thereof, including actual
attorneys' fees and all costs incurred in such action. TENANT HEREBY WAIVES ANY
AND ALL RIGHTS TO A JURY TRIAL IN CONNECTION WITH ANY LITIGATION CONCERNING THIS
LEASE.
31.10 At the request of either party, Landlord and Tenant shall execute a
memorandum of Lease, which may be filed in the real property records.
31.11 Submission of this instrument for examination or signature by Tenant
does not constitute a reservation of or option for Lease, and shall not be
effective as a lease or otherwise, until execution and delivery by both
Landlord and Tenant.
31.12 Each party represents and warrants that the execution, issuance,
delivery and performance of this Lease have been duly and properly authorized by
all necessary corporate, director, shareholder or any other action of such
party.
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IN WITNESS WHEREOF, the parties hereto have executed this Lease the day
and year first appearing above.
LANDLORD: TENANT:
XXXXXX CANNING COMPANY HOOPESTON FOODS DENVER CORP
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxx X. Xxxxxx
------------------- -------------------
Its: CEO Its: Pres/CEO
--------------- ---------------
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SCHEDULE 1
List of Other Agreements
1. Non-Branded Inventory Sales Agreement.
2. Equipment
Lease Agreement for Seller's equipment located at the Plant.
3. Co-Pack Agreement for Buyer to co-pack Seller's branded products.
4. License Agreement for Buyer to license the use of permits, licenses, recipes
and other intangible assets of Seller that are in use at the Plant.
5. Lease Override Agreement for additional payments to be made by Buyer to
Seller.
6. EBITDA Overview Committee Agreement.
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