Exhibit 10.14
EXECUTION COPY
AMENDED AND RESTATED
LEASE AGREEMENT
by and between
PG-NOM (ALBERTA), INC.,
an Alberta corporation, as nominee for PG-TRUST (DE),
a trust formed under the laws of the State of Delaware
as LANDLORD
and
CWD WINDOWS AND DOORS, INC.,
a Canadian corporation,
as TENANT
Premises: Calgary, Alberta
Dated as of: March__________, 2005
Effective as of : August 27, 2004
TABLE OF CONTENTS
Page
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1. Demise of Premises...................................................... 1
2. Certain Definitions..................................................... 1
3. Title and Condition..................................................... 8
4. Use of Leased Premises; Quiet Enjoyment................................. 10
5. Term.................................................................... 10
6. Basic Rent.............................................................. 11
7. Additional Rent......................................................... 11
8. Net Lease; Non-Terminability............................................ 13
9. Payment of Impositions.................................................. 13
10. Compliance with Laws and Easement Agreements; Environmental Matters..... 14
11. Liens; Recording........................................................ 16
12. Maintenance and Repair.................................................. 17
13. Alterations and Improvements............................................ 17
14. Permitted Contests...................................................... 19
15. Indemnification......................................................... 19
16. Insurance............................................................... 20
17. Casualty and Condemnation............................................... 24
18. Termination Events...................................................... 25
19. Restoration............................................................. 26
20. Intentionally Omitted................................................... 27
21. Assignment and Subletting; Waiver of Landlord's Liens................... 27
22. Events of Default....................................................... 30
23. Remedies and Damages Upon Default....................................... 32
24. Notices................................................................. 36
25. Estoppel Certificate.................................................... 36
26. Surrender............................................................... 36
27. No Merger of Title...................................................... 37
23. Books and Records....................................................... 37
29. Determination of Value.................................................. 38
30. Non-Recourse as to Landlord............................................. 39
31. Landlord's Financing.................................................... 40
32. Subordination: Non-Disturbance and Attornment........................... 40
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33. Tax Treatment; Reporting................................................ 40
34. Permitted Leasehold Mortgage............................................ 41
35. Rights of Permitted Leasehold Mortgagee................................. 41
36. Grants and Releases of Easement......................................... 44
37. Intentionally Omitted................................................... 45
38. Post-Closing Obligations................................................ 45
39. Miscellaneous........................................................... 47
EXHIBITS
Exhibit "A" - Land
Exhibit "B" - Machinery and Equipment
Exhibit "C" - Schedule of Permitted Encumbrances
Exhibit "D" - Rent Schedule
Exhibit "E-l" - Form of Subordination Attornment and Non-Disturbance
Agreement
Exhibit "E-2" - Tenant Estoppel Certificate
Exhibit "F" - Post-Closing Obligations
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AMENDED AND RESTATED LEASE AGREEMENT, made as of this ____________ day of
March, 2005, effective the 27th day of August, 2004, between PC-NOM (ALBERTA),
INC., an Alberta corporation as nominee for PG-TRUST (DE), a trust formed under
the laws of the State of Delaware ("Landlord"), with an address c/o W. P. Xxxxx
& Co. LLC, 00 Xxxxxxxxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, and CWD
WINDOWS AND DOORS, INC., a Canadian corporation, (singly and collectively, as
the context may require "Tenant"), with an address for notice purposes at care
of Ply Gem Holdings, Inc., 000 Xxxxxx Xxxx Xxx, Xxxxx X, Xxxxxxx, Xxxxxxxx,
00000 U.S.A.
BACKGROUND:
1. Landlord and Tenant entered into a certain Lease Agreement dated
August 27, 2004 (the "Original Lease") for the Leased Premises (as hereinafter
defined).
2. Landlord and Tenant desire to amend and restate the Original
Lease in its entirety as hereinafter set forth.
NOW, THEREFORE.
in consideration of the rents and provisions herein stipulated to be paid and
performed, Landlord and Tenant hereby covenant and agree as follows:
1. Demise of Premises. Landlord hereby demises and lets to Tenant,
and Tenant hereby takes and leases from Landlord, for the term and upon the
provisions hereinafter specified, the following described property
(collectively, the "Leased Premises"): (a ) the premises described in Exhibit
"A" hereto, together with the Appurtenances (collectively, the "Land"); (b) the
buildings,structures and other improvements now or hereafter constructed on the
Land (collectively, the "Improvements"); and (c) the fixtures, machinery,
equipment and other property described in Exhibit "B" hereto (collectively, the
"Equipment").
2. Certain Definitions.
"AACI" shall mean an Accredited Appraiser of the Appraisal
Institute of Canada.
"Acquisition Cost" shall mean $7,100,811.
"Acquisition Fee" shall mean $334,593.
"Additional Rent" shall mean Additional Rent as defined in
Paragraph 7.
"Adjoining Property" shall mean all sidewalks, driveways,
curbs, gores and vault spaces adjoining any of the Leased Premises.
"Affiliate" shall mean any Person which shall (i) control,
(ii) be under the control of, or (iii) be under common control with Tenant (the
term "control" as used herein shall be deemed to mean ownership of more than
50% of the outstanding voting stock of a corporation
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or other majority equity and control interest if such Person is not a
corporation) and the power to direct or cause the direction of the management or
policies of such Person.
"Alterations" shall mean all changes, additions, improvements
or repairs to, all alterations, reconstructions, renewals, replacements or
removals of and all substitutions or replacements for any of the Improvements or
Equipment, both interior and exterior, structural and non-structural, and
ordinary and extraordinary.
"Appurtenances" shall mean all tenements, hereditaments,
easements, rights-of-way, rights, privileges in and to the Land, including (a)
easements over other lands granted by any Easement Agreement and (b) any
streets, ways, alleys, vaults, gores or strips of land adjoining the Land.
"Assignment" shall mean any assignment of rents and leases
from Landlord to a Lender which (a) encumbers any of the Leased Premises and
(b) secures Landlord's obligation to repay a Loan, as the same may be amended,
supplemented or modified from time to time.
"Basic Rent" shall mean Basic Rent as defined in Paragraph 6.
"Basic Rent Payment Date" shall mean Basic Rent Payment Date
as defined in Paragraph 6.
"Business Days" shall mean any day except Saturdays, Sundays
and legal holidays on which banks are generally not open for business in the
City of Calgary.
"Canadian Funds" shall mean immediately available funds which
at the time of payment are legal tender for the payment of public and private
debts in Canada.
"Capital Tax" shall mean any tax or taxes exigible under any
provincial or federal legislation based upon or computed by reference to the
paid-up capital or place of business of the Landlord, as determined for the
purposes of such tax, or based upon or computed by reference to the taxable
capital employed or invested in Canada, as determined for the purposes of such
tax, or any similar tax levied, imposed or assessed in the future in lieu
thereof, or in addition thereto by any governmental authority and includes for
greater certainty, the tax imposed of under Parts 1.3 and VI of the Income Tax
Act (Canada). Provided, however, that Capital Tax shall be calculated as though
the Leased Premises were the only asset of the Landlord in excess of any minimum
taxable capital.
"Casualty" shall mean any loss of or damage to any property
(including the Leased Premises) included within or related to the Leased
Premises as a result of any fire, earthquake or other event of casualty.
"Commencement Date" shall mean Commencement Date as defined in
Paragraph 5.
"Condemnation" shall mean (a) any taking of all or a portion
of any of the Leased Premises (i) in or by expropriation, condemnation or other
eminent domain proceedings pursuant to any Law, general or special, or (ii) by
reason of any agreement with any expropriating body or condemnor in settlement
of or under threat of any such expropriation, condemnation or other eminent
domain proceeding, or (b) any conveyance in lieu of
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expropriation or condemnation. The Condemnation shall be considered to have
taken place as of the later of the date actual physical possession is taken by
the expropriating body or condemnor, or the date on which the right to
compensation and damages accrues under the law applicable to the Leased
Premises.
"Condemnation Notice" shall mean notice or knowledge of the
institution of or intention to institute any proceeding for Condemnation.
"Costs" of a Person or associated with a specified transaction
shall mean all reasonable costs and expenses incurred by such Person or
associated with such transaction, including without limitation, legal fees and
expenses, court costs, brokerage fees, escrow fees, title insurance premiums,
mortgage commitment fees, mortgage points, recording fees and transfer taxes,
but excluding the internal administrative costs (including overhead) of such
Person, as the circumstances require.
"CPI" shall mean CPI as defined in Exhibit "D" hereto.
"Defalt Rate" shall mean the Default Rate as defined in
Paragraph 7(a)(iv).
"Easement Agreement" shall mean any conditions, covenants,
restrictions, easements, declarations, licenses and other agreements listed as
Permitted Encumbrances or as may hereafter affect the Leased Premises.
"Environmental Law" shall mean (a) whenever enacted or
promulgated, any applicable federal, provincial, foreign and Local law, statute,
ordinance, rule, regulation, license, permit, authorization, approval, consent,
court order, judgment, decree, injunction, code, requirement or agreement with
any governmental entity, (i) relating to pollution (or the cleanup thereof), or
the protection of air, water vapour, surface water, groundwater, drinking water
supply, land (including land surface or subsurface), plant, aquatic and animal
life from injury caused by a Hazardous Substance or (ii) concerning exposure to,
or the use, containment, storage, recycling, reclamation, reuse, treatment,
generation, discharge, transportation, processing, handling, labeling,
production, disposal or remediation of Hazardous Substances, Hazardous
Conditions or Hazardous Activities, in each case as amended and as now or
hereafter in effect, and (b) any common law or equitable doctrine (including,
without limitation, injunctive relief and tort doctrines such as negligence,
nuisance, trespass and strict liability) that may impose liability or
obligations or injuries or damages due to or threatened as a result of the
presence of, exposure to, or ingestion of, any Hazardous Substance. The term
Environmental Law includes, without limitation, the Canadian Environmental
Protection Act, 1999, Environmental Protection and Enhancement Act (Alberta),
Water Act (Alberta) and Municipal Government Act (Alberta) as amended from time
to time, and any successor legislation.
"Environmental Violation" shall mean (a) any direct or
indirect discharge, disposal, spillage, emission, escape, pumping, pouring,
injection, leaching, release, seepage, filtration or transporting of any
Hazardous Substance at, upon, under, onto or within the Leased Premises, or from
the Leased Premises to the environment, in violation of any Environmental Law or
in excess of any reportable quantity established under any Environmental Law or
which is likely to result in any liability to Landlord, Tenant or Lender, any
Federal, provincial or local government or any other Person for the costs of any
removal or remedial action or natural resources damage or for bodily injury or
properly damage, (b) any deposit, storage, dumping, placement or use of any
Hazardous Substance at, upon, under or within the Leased Premises (or
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which extends to any Adjoining Property) in violation of any Environmental Law
or in excess of any reportable quantity established under any Environmental Law
or which is likely to result in any liability to any Federal, provincial or
local government or to any other Person for the costs of any removal or remedial
action or natural resources damage or for bodily injury or property damage, (c)
the abandonment or discarding of any barrels, containers or other receptacles
containing any Hazardous Substances in violation of any Environmental Laws, (d)
any activity, occurrence or condition which is likely to result in any
liability, cost or expense to Landlord or Lender or any other owner or occupier
of the Leased Premises, or which is likely to result in a creation of a lien on
the Leased Premises under any Environmental Law, or (e) any violation of or
noncompliance with any Environmental Law.
"Equipment" shall mean the Equipment as defined in Paragraph
1.
"Event of Default" shall mean an Event of Default us defined
in Paragraph 22(a).
"Expiration Date" shall mean Expiration Date as defined in
Paragraph 5(a).
"Fair Market Rental Value" shall mean thc fair market rental
value of the Leased Premises for the relevant Renewal Team determined in
accordance with the procedure specified in Paragraph 29.
"Fair Market Value Date" shall mean the date when the Fair
Market Rental Value is determined in accordance with Paragraph 29.
"Guarantee" shall mean the Guaranty and Suretyship Agreement
dated as of the date hereof from Guarantor to Landlord guaranteeing the payment
and performance by Tenant of all of Tenant's obligations under the Lease.
"Guarantor" shall collectively mean Ply Gem Holdings, Inc., a
Delaware corporation, MWM Holding, Inc., a Delaware corporation, Great Lakes
Window Inc., an Ohio corporation, MW Manufacturers Holding Corp., a Delaware
corporation, MW Manufacturers Inc., a Delaware corporation, Napco Window
Systems, Inc., a Delaware corporation, Kroy Building Products, Inc., a Delaware
corporation and Thermal-Gard Inc., a Pennsylvania corporation.
"Hazardous Activity" means any activity, process, procedure or
undertaking which directly or indirectly (a) procures, generates or creates any
Hazardous Substance; (b) causes or results in (or threatens to cause or result
in) the release, seepage, spill, leak, flow, discharge or emission of any
Hazardous Substance into the environment (including the air, ground water,
watercourses or water systems) (c) involves the containment or storage of any
Hazardous Substance; or (d) would cause the Leased Premises or any portion
thereof to become a hazardous waste treatment, recycling, reclamation,
processing, storage or disposal facility within the meaning of any Environmental
Law.
"Hazardous Condition" means any condition which would support
any claim or liability under any Environmental Law, including the presence of
underground storage tanks.
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"Hazardous Substance" means (i) any substance, material,
product, petroleum, petroleum product, derivative compound or mixture, mineral
(including asbestos), chemical, gas, medical waste, or other pollutant, in each
case whether naturally occurring, man-made or the by-product of any process,
that is toxic, harmful or hazardous or acutely hazardous to the environment or
public health or safety or (ii) any substance supporting a claim under any
Environmental Law, whether or not defined as hazardous as such under any
Environmental Law. Hazardous Substances include, without limitation, any toxic
or hazardous waste, pollutant, contaminant, industrial waste, petroleum or
petroleum-derived substances or waste, radon, radioactive materials, asbestos,
asbestos containing materials, microbial matter (including but not limited to
mold, mildew and other fungi or bacterial matter which reproduces through the
release of spores or the splitting of cells), urea formaldehyde foam insulation,
lead and polychlorinated biphenyls.
"Impositions" shall mean the Impositions as defined in
Paragraph 9(a).
"Improvements" shall mean the Improvements as defined in
Paragraph 1.
"Indemnitee" shall mean an Indemnitee as defined in
Paragraph 15.
"Initial Term" shall mean Initial Term as defined in Paragraph
5(a).
"Insurance Requirements" shall mean the requirements of all
insurance policies required to be maintained in accordance with this Lease.
"Land" shall mean the Land as defined in Paragraph. 1.
"Landlord Expenses" shall mean (i) any cost or expense that is
the express obligation of Landlord under this Lease, (ii) debt service for any
indebtedness of Landlord, (iii) any Landlord Impositions, (iv) except as
expressly set forth in Paragraph 7(a)(i), administrative expenses of Landlord,
and (v) except as expressly set forth herein with respect to any initial
financing, costs incurred by Landlord in connection with financing, or
refinancing the Leased Premises.
"Landlord Impositions" shall mean: (a) any estate, gift or
inheritance tax of Landlord; (b) any transfer or other taxes incurred by
Landlord in connection with a conveyance of the fee interest in the Leased
Premises to any Person except Tenant or its designee, or a transfer of any
direct or indirect equity interests in Landlord to any Person except Tenant or
its designee, or any mortgage recording taxes incurred in connection with a
mortgage of Landlord's fee interest in the Leased Premises except for mortgage
recording taxes payable on the initial fee Mortgage; (c) any franchise tax, net
income tax, withholding tax, capital gains tax, gross receipts tax or similar
tax (other than any gross receipts tax or similar tax imposed in lieu of any tax
or imposition that Tenant is obligated to pay under Paragraph 9); provided, that
if at any time during the term of this Lease, the method of taxation shall be
such that there shall be assessed. levied, charged or imposed on Landlord a tax,
in lieu of real estate taxes or any other Imposition payable by Tenant, upon the
value of the Leased Premises, men all such levies and taxes or the part thereof
so measured or based shall be payable by Tenant, but only to the extent that
such levies or taxes would be payable if the Leased Premises were the only
property of Landlord, and Tenant shall pay and discharge the same as herein
provided.
"Law" shall mean any constitution, statute, rule of law, code,
ordinance, order, judgment, decree injunction, rule, regulation, policy,
requirement or administrative or
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judicial determination, even if unforeseen or extraordinary, of every duly
constituted governmental authority, court or agency; now or hereafter enacted or
in effect.
"Lease" shall mean this Amended and Restated Lease Agreement.
"Leasehold Estate" shall mean Tenant's leasehold estate under
this Lease.
"Lease Year" shall mean, with respect to the first Lease Year,
the period commencing on the Commencement Date and ending an midnight on the
last day of the twelfth (12th) consecutive calendar month following the month
in which the Commencement Date occurred, and each succeeding twelve (12) month
period during the Term.
"Leased Premises" shall mean the Leased Premises as defined in
Paragraph 1.
"Legal Requirements" shall mean the requirements of all
present and future Laws (including but not limited to Environmental Laws and
Laws relating to accessibility to, usability by, and discrimination against,
disabled individuals) and all covenants, restrictions and conditions now or
hereafter of record which may be applicable to Tenant or to any of the Leased
Premises, or to the use, manner of use, occupancy, possession, operation,
maintenance, alteration, repair or restoration of any of the Leased Premises,
even if compliance therewith necessitates structural changes or improvements or
results in interference with the use or enjoyment of any of the Leased Premises
or requires Tenant to carry insurance other than as required by this Lease.
"Lender" shall mean any Person (and its respective successors
and assigns) which may, on or after the date hereof, make a Loan to Landlord or
be the holder of a Note.
"Limited Remedy Default" shall mean an Event of Default
specified in the following clauses of Paragraph 22(a): clause (iii) if the
misrepresentation is with respect to the penultimate sentence of Sections 2, 3,
4, 7 and 24 of the Lessee's Certificate, the first sentence of Section 3 or the
first or last sentence of Section 7 of the Lessee's Certificate, clause (iv),
clause (v)(B) clause (vi)(E), clause (ix)(B), clause (xi), clause (xiii) (if
such Event of Default is with respect to or arises as a result of a default
under Paragraphs 6 or 9 of the Guarantor's Certificate, Sections 3.03(ii),
3.04(iv), 4.01 (c) or 4.01 (d) of the Guaranty), or clause (xiv).
"Loan" shall mean any loan (or the portion thereof allocable
to the Leased Premises, if applicable) made by one or more Lenders to Landlord,
which loan is secured by a Mortgage and an Assignment and evidenced by a Note.
"Monetary Obligations" shall mean Rent and all other sums
payable by Tenant under this Lease to Landlord, to any third party on behalf of
Landlord or to any Indemnitee.
"Moody's" shall mean Xxxxx'x Investor Services, Inc.
"Mortgage" shall mean any mortgage or deed of trust from
Landlord to a Lender which (a) encumbers any of the Leased Premises and (b)
secures Landlord's obligation to repay a Loan, as the same may be amended,
supplemented or modified.
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"Net Award" shall mean (a) the entire award payable to
Landlord or Lender by reason of a Condemnation whether pursuant to a judgment or
by agreement or otherwise, or (b) the entire proceeds of any insurance required
under clauses (i), (ii) (to the extent payable to Landlord or Lender),(iv), (v)
or (vi) of Paragraph I6(a), as the case may be, less any expenses incurred by
Landlord and Lender in collecting such award or proceeds.
"Note" shall mean any promissory note (or an allocable portion
thereof, if applicable) evidencing Landlord's obligation to repay a Loan, as the
same may be amended, supplemented or modified.
"Partial Condemnation" shall mean any Condemnation which does
not constitute a Termination Event.
"Permitted Encumbrances" shall mean those covenants,
restrictions, reservations, liens, conditions and easements and other
encumbrances, other than any Mortgage or Assignment, listed on Exhibit "C"
hereto (but such listing shall not be deemed to revive any such encumbrances
that have expired or terminated or are otherwise invalid or unenforceable).
"Permitted Leasehold Mortgage" shall mean any first lien,
mortgage, deed of trust, security deed, deed to secure debt, assignment,
security interest, pledge, financing statement, or any other instrument(s) or
agreement(s) intended to grant security for any obligation (including a
purchase-money or other promissory note) encumbering the Leasehold Estate, as
entered into, renewed, modified, consolidated, amended, extended, or assigned
from time to time.
"Permitted Leasehold Mortgagee" shall mean the holder of
Permitted Leasehold Mortgage, and its successors and assigns.
"Person" shall mean an individual, partnership, association,
corporation or other entity.
"Post-Closing Obligations" shall mean those obligations of
Tenant specified in Exhibit "F" hereto.
"Preapproved Assignee" shall mean Preapproved Assignee as
defined in Paragraph 21 (a)(i).
"Prepayment Premium" shall mean any payment (other than a
payment of principal and/or interest which Landlord is required to make under a
Note or a Mortgage) by reason of any prepayment by Landlord of any principal due
under a Note or Mortgage, and which may be (in lieu of such prepayment premium
or prepayment penalty) (a) a "make whole" or yield maintenance clause requiring
a prepayment premium or (b) a defeasance payment (such defeasance payment to be
an amount equal to the positive difference between (i) the total amount required
to defease a Loan and (ii) the outstanding balance of the Loan as of the date of
such defeasance, in the case of either (a) or (b) in an amount sufficient to
compensate the Lender for the loss of the benefit of the Loan due to a
prepayment.
"Present Value" of any amount shall mean such amount
discounted by a rate per annum which is the lower of (a) the Prime Rate plus two
percent (2%) at the time such present value is determined or (b) eight percent
(8%) per annum.
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"Prime Rate" shall mean the interest rate per annum as
published from time to time, in The Wall Street Journal as the "Prime Rate" in
its column entitled "Money Rate". The Prime Rate may not be the lowest rate of
interest charged by any "large U.S. money center commercial banks" and Landlord
makes no representations or warranties to that effect. In the event The Wall
Street Journal ceases publication or ceases to publish the "Prime Rate" as
described above, the Prime Rate shall be the average per annum discount rate
(the "Discount Rate" on ninety-one (91) day bills ("Treasury Bills") issued from
time to time by the United States Treasury at its most recent auction, plus
three hundred (300) basis points. If no such 91-day Treasury Bills are then
being issued, the Discount Rate shall be the discount rate on Treasury Bills
then being issued for the period of time closest to ninety-one (91) days.
"Province" shall mean the Province of Alberta, Canada.
"Relevant Date" shall mean the date on which Fair Market
Rental Value is determined in the event of any extension of this Lease pursuant
to Paragraph 5(b).
"Renewal Term" shall mean Renewal Term as. defined in
Paragraph 5.
"Rent" shall mean, collectively, Basic Rent and Additional
Rent.
"S&P" shall mean Standard and Poor's Rating Services.
"Site Assessment" shall mean a Site Assessment as defined in
Paragraph 10(c).
"Surviving Obligations" shall mean any obligations of Tenant
under this Lease, actual or contingent, which arise on or prior to the
expiration or prior termination of this Lease or which survive such expiration
or termination by their own terms.
"Tenant's Equipment" shall mean all trade fixtures, machinery,
office, manufacturing storage materials, handling and warehouse equipment which
are used by Tenant in the operation of its business, including any air
compressors and exhaust fans used by Tenant in the operation of its business.
"Term" shall mean the Initial Term and any exercised Renewal
Term.
"Termination Notice" shall mean Termination Notice as defined
in Paragraph 18(a).
"Third Party Purchaser" shall mean the Third Party Purchaser
as defined in Paragraph 21(h).
"U.S. Dollars" shall mean the legal currency of the United
States of America.
"Warranties" shall mean Warranties as defined in Paragraph
3(d).
3. Title and Condition.
(a) The Leased Premises are demised and let subject to (i) the
Mortgage and Assignment, (ii) the rights of any Persons in possession of the
Leased Premises,
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(iii) the existing state of title of any of the Leased Premises, including any
Permitted Encumbrances, (iv) any state of facts which an accurate survey or
physical inspection of the Leased Premises might show, (v) all Legal
Requirements, including any existing violation of any thereof, and (vi) the
condition of the Leased Premises as of the commencement of the Term, without
representation or warranty by Landlord.
(b) Tenant acknowledges that the Leased Premises are in good
condition and repair at the inception of this Lease. LANDLORD LEASES AND WILL
LEASE AND TENANT TAKES AND WILL TAKE THE LEASED PREMISES AS IS. TENANT
ACKNOWLEDGES THAT LANDLORD (WHETHER ACTING AS LANDLORD HEREUNDER OR IN ANY OTHER
CAPACITY) HAS NOT MADE AND WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED TO HAVE
MADE, ANY WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF
THE LEASED PREMISES, INCLUDING ANY WARRANTY OR REPRESENTATION AS TO (i) ITS
FITNESS, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE, (ii) THE QUALITY
OF THE MATERIAL OR WORKMANSHIP THEREIN, (iii) THE EXISTENCE OF ANY DEFECT,
LATENT OR PATENT, (iv) LANDLORD'S TITLE THERETO, (v) VALUE, (vi) COMPLIANCE WITH
SPECIFICATIONS, (vii) LOCATION, (viii) USE, (ix) CONDITION, (x) MERCHANTABILITY,
(xi) QUALITY, (xii) DESCRIPTION, (xiii) DURABILITY, (xiv) OPERATION, (xv) THE
EXISTENCE OF ANY HAZARDOUS SUBSTANCE, HAZARDOUS CONDITION OR HAZARDOUS ACTIVITY
OR (xvi) COMPLIANCE OF THE LEASED PREMISES WITH ANY LAW OR LEGAL REQUIREMENT;
AND ALL RISKS INCIDENT THERETO ARE TO BE BORNE BY TENANT. TENANT ACKNOWLEDGES
THAT THE LEASED PREMISES IS OF ITS SELECTION AND TO ITS SPECIFICATIONS AND THAT
THE LEASED PREMISES HAS BEEN INSPECTED BY TENANT AND IS SATISFACTORY TO IT. IN
THE EVENT OF ANY DEFECT OR DEFICIENCY IN ANY OF THE LEASED PREMISES OF ANY
NATURE WHETHER LATENT OR PATENT, LANDLORD SHALL NOT HAVE ANY RESPONSIBILITY OR
LIABILITY WITH RESPECT THERETO OR FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES
(INCLUDING STRICT LIABILITY IN TORT). THE PROVISIONS OF THIS PARAGRAPH 3(b) HAVE
BEEN NEGOTIATED, AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY
WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED
PREMISES, ARISING PURSUANT TO ANY LAW NOW OR HEREAFTER IN EFFECT OR ARISING
OTHERWISE.
(c) Tenant represents to Landlord that Tenant has examined the
title to the Leased Premises prior to the execution and delivery of this Lease
and has found the same to be satisfactory for the purposes contemplated hereby.
Tenant acknowledges that (i) fee simple title (both legal and equitable) to the
Leased Premises is in Landlord and that Tenant has only the leasehold right of
possession and use of the Leased Premises as provided herein, (ii) the
Improvements conform to all material Legal Requirements and all Insurance
Requirements, (iii) all easements necessary or appropriate for the use or
operation of the Leased Premises have been obtained, (iv) all contractors and
subcontractors who have performed work on or supplied materials to the Leased
Premises have been fully paid, and all materials and supplies have been
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fully paid for, (v) the Improvements have been fully completed in all material
respects in a workmanlike manner, and (vi) all Equipment necessary or
appropriate for the use or operation of the Leased Premises has been installed
and is presently fully operative in all malarial respects.
(d) Landlord hereby assigns to Tenant, without recourse or
warranty whatsoever, all assignable warranties, guaranties, indemnities and
similar rights (collectively, "Warranties") which Landlord may have against any
manufacturers, seller, engineer, contractor or builder in respect of any of the
Leased Premises. Such assignment shall remain in effect until the expiration or
earlier termination of this Lease, whereupon such assignment shall cease and all
of the Warranties shall automatically revert to Landlord. In confirmation of
such reversion Tenant shall execute and deliver promptly any certificate or
other document reasonably required by Landlord. Landlord shall also retain the
right to enforce any Warranties upon the occurrence and during the continuance
of an Event of Default. Tenant shall use commercially reasonable efforts to
enforce the Warranties in accordance with their respective terms.
4. Use of Leased Premises: Quiet Enjoyment.
(a) Tenant may occupy and use the Leased Premises, for a
manufacturing and distribution facility with ancillary office, storage and
parking uses and for no other purpose without the prior written consent of
Landlord which shall not be unreasonably withheld or delayed. Tenant shall not
use or occupy or permit any of the Leased Premises to be used or occupied, nor
do or permit anything to be done in or on any of the Leased Premises, in a
manner which would or might (i) violate any Law or Legal Requirement, (ii) make
void or voidable or cause any insurer to cancel any insurance required by this
Lease, or make it difficult or impossible to obtain any such insurance at
commercially reasonable rates, (iii) make void or voidable, cancel or cause to
be cancelled or release any of the Warranties, (iv) cause structural injury to
any of the Improvements or (v) constitute a public or private nuisance or waste.
(b) Subject to the provisions hereof, so long as no Event of
Default has occurred and is continuing, Tenant shall quietly hold, occupy and
enjoy the Leased Premises throughout the Term, without any hindrance, ejection
or molestation by Landlord or anyone claiming through or under Landlord with
respect to matters that arise after the date hereof, provided that Landlord or
its agents may enter upon and examine any of the Leased Premises at such
reasonable times as Landlord may select and upon reasonable notice to Tenant
(except in the case of any emergency, in which event no notice shall be
required), but at all times accompanied by a representative designated by
Tenant, for the purpose of inspecting the Leased Premises, verifying compliance
or non-compliance by Tenant with its obligations hereunder and the existence or
non-existence of an Event of Default, showing the Leased Premises to
prospective Lenders and purchasers, making any repairs and taking such other
action with respect to the Leased Premises as is permitted by any provision
hereof.
5. Term.
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(a) Subject to the provisions hereof, Tenant shall have and
hold the Leased Premises for an initial term (the "Initial Term") which
commenced on August 27, 2004 (the "Commencement Date") and ends on August 31,
2024 (the "Expiration Date").
(b) Provided that if, on or prior to the Expiration Date or
any other Renewal Date (as hereinafter defined) this Lease shall not have been
terminated pursuant to any provision hereof, then on the Expiration Date and on
the tenth (10th) anniversary of the Expiration Date (the Expiration Date and
such anniversary being a "Renewal Date"), the Term shall be deemed to have been
automatically extended for an additional period of ten (10) years (each such
extension, a "Renewal Term"), unless Tenant shall notify Landlord in writing at
least eighteen (18) months prior to the next Renewal Date that Tenant is
terminating this Lease as of the next Renewal Date. At Landlord's request at any
time after the giving of a notice of termination, Tenant shall execute a notice
in recordable farm confirming such termination. Any such extension of the Term
under this Paragraph 5(b) shall be subject to all of the provisions of this
Lease, as the same may be amended, supplemented or modified.
(c) If Tenant exercises its option pursuant to Paragraph 5(b)
not to have the Term automatically extended, or if an Event of Default occurs
and is continuing, then Landlord shall have the right during the remainder of
the Term then in effect and, in any event, Landlord shall have the right during
the last year of the Term, to (i) advertise the availability of the Leased
Premises for sale or reletting and to erect upon the Leased Premises signs
indicating such availability and (ii) show the Leased Premises to prospective
purchasers or tenants or their agents subject to the conditions in Paragraph
4(b) at such reasonable times as Landlord may select.
6. Basic Rent. Tenant shall pay to Landlord, as annual rent ("Basic
Rent") for the Leased Premises during the Term, the amounts determined in
accordance with Exhibit "D" hereto. Basic Rent is payable quarterly in advance
on the twenty-fifth (25th) day of each September, December, March and June
during the Term for the next three (3) calendar months as set forth in said
Exhibit "D". The date that each payment of Basic Rent is due is hereinafter
referred to as a "Basic Rent Payment Date". Basic Rent for the period from the
Commencement Date to and including September 30, 2004 was paid on the
Commencement Date and quarterly payments of Basic Rent have been made through
March 31, 2005. Each such rental payment shall be made (a) at Landlord's sole
discretion, to Landlord at its address set forth above and/or to such one or
more other Persons, at such addresses and in such proportions as Landlord may
direct by ten (10) Business Days' prior written notice to Tenant (in which event
Tenant shall give Landlord notice of each such payment concurrent with the
making thereof), and (b) at Tenant's option, by a cheque hand delivered at least
two (2) Business Days before or mailed at least five (5) Business Days before
the applicable Basic Rent Payment Date, or on the applicable Basic Rent Payment
Date by wire transfer of Canadian Funds to an account designated by Landlord in
writing. Pro rata Basic Rent for the period from the date hereof through the
last day of the month hereof shall be paid on the date hereof.
7. Additional Rent.
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(a) Tenant shall pay and discharge, as additional rent
(collectively, "Additional Rent"):
(i) Except for Landlord's Expenses or as otherwise
specifically provided herein, all costs and expenses of Tenant, Landlord and any
other Persons specifically referenced herein which are incurred in connection or
associated with (A) the ownership, use, non-use, occupancy, possession,
operation, condition, design, construction, maintenance alteration, repair or
restoration of any of the Leased Premises, (B) the performance of any of
Tenant's obligations under this Lease, (C) any sale or other transfer of any of
the Leased Premises to Tenant under this Lease, (D) the prosecution, defense or
settlement of any litigation involving or arising from any of the Leased
Premises, this Lease, or the sale of the Leased Premises to Landlord unless such
litigation arises as a result of the gross negligence or willful misconduct of
Landlord, (E) the exercise or enforcement by Landlord, its successors and
assigns, of any of its rights under this Lease during the pendency of an Event
of Default, (F) any amendment to or modification or termination of this Lease
made at the request of Tenant, (G) Costs of Landlord's counsel incurred in
connection with any act undertaken by Landlord (or its counsel) at the request
of Tenant, or incurred in connection with any act of Landlord performed on
behalf of Tenant, (H) sales taxes payable by the Landlord on the purchase of
goods and services included in Additional Rent (excluding any such sales taxes
as are available to and claimed by the Landlord as a credit in determining the
Landlord's net tax liability on account of sales taxes but only to the extent
that such sales taxes are included in Additional Rent); (I) Capital Taxes, (J)
the review of Post-Closing Obligations, (K) an administrative fee of $10,000
payable to Landlord in connection with any Exchange and (L) any other items
specifically required to be paid by Tenant under this Lease;
(ii) after the date that is seven (7) days after all or any
portion of any installment of Basic Rent is due and not paid, a late charge in
an amount equal to three percent (3%) of the amount of such unpaid installment
or portion thereof, as liquidated damages in order to compensate Landlord for a
portion of the costs and expenses related to handling such late payment, the
amounts of which are difficult or impossible to measure;
(iii) in addition to the amounts payable under clauses
7(a)(ii) and (iv) a sum equal to any additional sums (including any late charge
payable on the portion of Basic Rent equal to installments of principal and
interest on the then outstanding Loan, default penalties, interest and fees of
lender's counsel) which are payable by Landlord to any Lender under any Note by
reason of Tenant's late payment or non-payment of Basic Rent or by reason of an
Event of Default, provided, however, that Tenant shall receive as a credit
against any late charge or default interest payable on the then outstanding Loan
an amount equal to the product of (x) the sum of the late charge paid pursuant
to Paragraph 7(a)(ii) and the amount of the default interest paid pursuant to
Paragraph 7(a)(iv) and (y) the ratio of the amount of the Loan to the
Acquisition Cost; and
(iv) interest at the rate (the "Default Rate") of three
percent (3%) over the Prime Rate per annum on the following sums until paid in
full: (A) all overdue installments of Basic Rent from the date that is (5)
Business Days after the respective due dates
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thereof, (B) all overdue amounts of Additional Rent relating to obligations
which Landlord shall have paid on behalf of Tenant and delivered notice to
Tenant, and (C) all other overdue amounts of Additional Rent, from the date that
is ten (10) Business Days after the date upon which Landlord shall have notified
Tenant in writing of such overdue amount.
(b) Tenant shall pay and discharge (i) any Additional Rent
referred to in Paragraph 7(a)(i) when the same shall become due, provided that
amounts which are billed to Landlord or any third party, but not to Tenant,
shall be paid within ten (10) Business Days after Landlord's written request for
payment thereof, and (ii) any other Additional Rent, within; ten (10) Business
Days after Landlord's written request for payment thereof.
(c) In no event shall amounts payable under Paragraph
7(a)(ii), (iii) and (iv), or elsewhere in this Lease exceed the maximum amount
permitted by applicable Law.
8. Net Lease Non-Terminability.
(a) This is a net lease and all Monetary Obligations shall be
paid without notice or demand (except as expressly set forth herein) and without
set-off, counterclaim, recoupment, abatement, suspension, deferment, diminution,
deduction, reduction or defense (collectively, a "Set-Off").
(b) Except as expressly set forth in this Lease, this Lease
and the rights of Landlord and the obligations of Tenant hereunder shall not be
affected by any event or for any reason or cause whatsoever foreseen or
unforeseen.
(c) The obligations of Tenant hereunder shall be separate and
independent covenants and agreements, all Monetary Obligations shall continue to
be payable in all events (or in lien thereof, Tenant shall pay amounts equal
thereto), and the obligations of Tenant hereunder shall continue unaffected
unless the requirement to pay or perform same shall have been terminated
pursuant to an express provision of this Lease. All Rent payable by Tenant
hereunder shall constitute "rent" for all purposes.
(d) Except as otherwise expressly provided in this Lease,
Tenant shall have no right and hereby waives all rights which it may have under
any Law (i) to quit, terminate or surrender this Lease or any of the Leased
Premises, or (ii) to any Set-Off of Any Monetary Obligations.
9. Payment of Impositions. Tenant shall, before interest or
penalties are due thereon, pay and discharge all taxes (including real and
personal property, franchise, sales, goods and services, gross receipts or rent
taxes), all charges for any easement or agreement maintained for the benefit of
any of the Leased Premises, all assessments and levies, all permit, inspection
and license fees, all rents and charges for water, sewer, utility and
communication services relating to any of the Leased Premises, all ground rents
and all other public charges whether of a like or different nature, even if
unforeseen or extraordinary, imposed upon or assessed against (i) Tenant, (ii)
Tenant's leasehold interest in the Leased Premises, (iii) any of
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the Leased Premises, (iv) Landlord as a result of or arising in respect of the
acquisition, ownership, occupancy, leasing, use, possession of any of the Leased
Premises or the sale of any of the Leased Premises or any part thereof to Tenant
or its designee or any activity conducted on any of the Leaed Premises, or
imputed to or payable by Landlord as the result of its ownership of the Leased
Premises or the Rent, or (v) any Lender by reason of any Note, Mortgage,
Assignment or other document evidencing or securing a Loan and which (as to this
clause (v)) Tenant has agreed to pay (collectively the "Imposition"): provided,
that (A) nothing herein shall obligate Tenant to pay Landlord Expenses, and (B)
so long as no Event of Default exists, Tenant shall enroll the Leased Premises
into the "TIPP" program and pay realty taxes to the applicable taxing authority
on a monthly basis in accordance with the "TIPP" program. Landlord shall have
the right to require Tenant to pay, together with scheduled installments of
Basic Rent, the amount of the gross receipts or rent tax, if any, payable with
respect to the amount of such installment of Basic Rent. If any Imposition may
be paid in installments without penalty, tenant shall have the option to pay
such Imposition in installments. In any event, Tenant shall be liable only for
those Impositions which accrue or become due and payable during the Term, and
Landlord shall reimburse Tenant as of the expiration of the Term for any
Impositions paid by Tenant that accrue on account of the period from and after
the expiration of the Term. Tenant shall prepare and file all tax reports
required by governmental authorities which relate to the Impositions. Tenant
shall deliver to Landlord (1) copies of all settlements and notices pertaining
to the Impositions which may be issued by any governmental authority within ten
(10) Business Days after Tenant's receipt thereof, (2) receipts for payment of
all taxes required to be paid by Tenant hereunder within thirty (30) Business
Days after the due date thereof (including the monthly due date under the "TIPP"
program) and (3) receipts for payment of all other Impositions within ten (10)
Business Days after Landlord's request therefor.
10. Compliance with Laws and Easement Agreements: Environmental
Matters.
(a) Tenant shall, at its expense, comply with and conform to,
and cause the Leased Premises and any other Person occupying any part of the
Leased Premises to comply with and conform to, all Insurance Requirements and
Legal Requirements (including all applicable Environmental Laws). Tenant shall
not at any time (i) cause, permit or suffer to occur any Environmental Violation
or (ii) permit any sublessee, assignee or other Person occupying the Leased
Premises under or through Tenant to cause, permit or suffer to occur any
Environmental Violation and, at the request of Landlord or Lender, Tenant shall
promptly remediate or undertake any other appropriate response action to correct
any existing Environmental Violation, however immaterial and (iii) without the
prior written consent of Landlord and Lender, permit any drilling or exploration
for or extraction, removal, or production of any minerals from the surface or
the subsurface of the Land, regardless of the depth thereof or the method of
mining or extraction thereof Any and all reports prepared for or by Landlord
with respect to the Leased Premises shall be for the sole benefit of Landlord
and Lender and no other Person shall have the right to rely on any such reports.
(b) Tenant, at its sole cost and expense, will at all times
promptly and faithfully abide by, discharge and perform all of the covenants,
conditions and agreements
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contained in any Easement Agreement on the part of Landlord or the occupant of
the Leased Premises to be kept and performed thereunder. Tenant will not alter,
modify, amend or terminate any Easement Agreement, give any consent or approval
thereunder, or enter into any new Easement Agreement, in each case in any manner
that would have an adverse effect on the value of Landlord's residual interest
in the Leased Premises, without the prior written consent of Landlord which
consent shall not be unreasonably withheld or delayed. Landlord shall not alter,
modify, amend or terminate any Easement Agreement, give any consent or approval
thereunder, or enter into any new Easement Agreement without the prior written
consent of Tenant, which may be withheld in Tenant's sole discretion, unless
such modification or amendment to an existing Easement Agreement or a new
Easement Agreement is necessary in the reasonable opinion of Landlord for the
continued operation of the Leased Premises after the expiration of this Lease,
in which event Tenant's consent shall not be unreasonably withheld or delayed.
(c) Upon reasonable prior written notice from Landlord, Tenant
shall permit such persons as Landlord may designate ("Site Reviewers") to visit
the Leased Premises at reasonable times and, in each event, accompanied by a
representative designated by Tenant perform environmental site investigations
and assessments ("Site Assessments") on the Leased Premises (i) in connection,
with any sale, financing or refinancing of the Leased Premises (ii) within the
six month period prior to the expiration of the Term, (iii) if reasonably
required by Lender or the terms of any credit facility to which Landlord is
bound, (iv) if an Event of Default exists or (v) at any other time that, in the
opinion of Landlord or Lender, a reasonable basis exists to believe that an
Environmental Violation exists. Such Site Assessments may include both above and
below the ground testing for Environmental Violations and such other tests as
may be necessary, in the opinion of the Site Reviewers, to conduct the Site
Assessments. Tenant shall supply to the Site Reviewers Such historical and
operational information in its possession regarding the leased Premises as may
be reasonably requested by the Site Reviewers to facilitate the Site
Assessments and shall make available for meetings with the Site Reviewers
appropriate, personnel having knowledge of such matters. The cost of performing
and reporting any Site Assessments (i) reasonably required by the Lender that
makes the initial Loan or (ii) if an Environmental Violation is found to exist
shall be paid by Landlord. The cost of performing and reporting any other Site
Assessments shall be paid by Landlord. All such Site Assessments shall be
conducted in a manner that shall not interfere in any material respect with the
conduct by Tenant of its business in the Leased Premises
(d) If an Environmental Violation occurs or is found to exist
and, in Landlord's reasonable-judgment, the cost of remediation of or other
response action with respect to, the same is likely to exceed ten percent (10%)
of the Acquisition Cost for the Leased Premises. Tenant shall provide to
Landlord, within ten (10) Business Days after Landlord's request therefor,
adequate assurances that Tenant has the financial resources to effect such
remediation in accordance with applicable Environmental Laws.
(e) Notwithstanding any other provision of this Lease, If an
Environmental Violation occurs or is found to exist at the Leased Premises, and
the Term would otherwise terminate or expire, and Landlord after good-faith
efforts to relet the Leased Premises through a third-party broker at market rate
is unable to do so solely as a result of such
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Environmental Violation, then, at the option of Landlord, the Term shall be
automatically extended beyond the date of termination "or expiration and this
Lease shall remain in full force and effect beyond such date until the earlier
to occur of (i) the completion of all remedial action in accordance with
applicable Environmental Laws or (ii) the date specified in a written notice
from Landlord to Tenant terminating this Lease.
(f) If Tenant fails to commence to correct any Environmental
Violation which occurs or is discovered to exist, within ninety (90) days
following such occurrence or discovery Landlord shall have the right (but no
obligation) to take any and all actions as Landlord shall deem necessary or
advisable in order to cure such Environmental Violation.
(g) Tenant shall notify Landlord immediately after becoming
aware of any Environmental Violation for alleged Environmental Violation) Or
noncomp with any of the covenants contained in this Paragraph 10 and shall
forward to Landlord immediately upon receipt thereof copies of all orders,
reports., notices, permits, applications or other communications relating to any
such violation or noncompliance.
(h) All future leases, subleases or concession agreements
relating to the Leased Premises entered into by Tenant shall contain covenants
of the other party not to at any time (i) cause any Environmental Violation to
occur are (ii) permit any Person occupying the Leased Premises through said
subtenant or concessionaire to cause any Environmental Violation to occur.
11. Liens: Recording.
(a) Tenant shall not, directly or indirectly, create or permit
to be created or to remain and shall promptly discharge or remove any Lien, levy
or encumbrance on Landlord's fee interest in any of the Leased Premises or on
any Rent or any other sums payable by Tenant under this Lease, other than any
Mortgage or Assignment, the Permitted Encumbrances and any mortgage, lien,
encumbrance or other charge created by or resulting solely from any act or
omission of Landlord. NOTICE IS HEREBY GIVEN THAT LANDLORD SHALL NOT BE LIABLE
FOR ANY LABOUR, SERVICES OR MATERIALS FURNISHED OR TO BE FURNISHED TO TENANT OR
TO ANYONE HOLDING OR OCCUPYING ANY OF THE LEASED PREMISES THROUGH OR UNDER
TENANT, AND THAT NO CONSTRUCTION OR OTHER LIENS FOR ANY SUCH LABOUR, SERVICES OR
MATERIALS SHALL ATTACH TO OR AFFECT THE INTEREST OF LANDLORD IN AND TO ANY OF
THE LEASED PREMISES, LANDLORD MAY AT ANY TIME, AND PRIOR TO COMMENCEMENT OF ANY
WORK UPON THE LEASED PREMISES THAT COULD RESULT IN THE FILING OF ANY SUCH LIEN
TENANT SHALL PROMPTLY AND PROPERLY, POST ON THE LEASED PREMISES, A NOTICE OF
LANDLORD'S NON-LIABILITY.
(b) Landlord and Tenant shall execute, deliver and record,
file or register (collectively, "record") all such instruments as may be
required or permitted by any
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present or future Law in order to evidence the respective interests of Landlord
and Tenant in the Leased Premises, and shall cause a notice, caveat or
memorandum of this Lease (or, if such a memorandum cannot be recorded, this
Lease), and any supplement hereto or thereto, to be registered in the land
titles office where the Leased Premises are located in order to protect the
validity and priority of this Lease.
12. Maintenance and Repair.
(a) Subject to Tenant's rights to make Alterations in accordance
with Paragraph 13, Tenant shall at all times maintain the Leased Premises and,
to the extent that Landlord or Tenant have any obligations, the Adjoining
Property in as good repair and condition as they are in on the date hereof, fit
to be used as a manufacturing and/or distribution facility (or as otherwise
permitted under the Section 4 of this Lease) in safe condition and in compliance
with applicable Laws and, in the case of the Equipment, in as good mechanical
condition as it was on the later of the date hereof or the date of its
installation, except in each instance for ordinary wear and tear. Tenant shall
promptly make all Alterations of every kind and nature, whether foreseen or
unforeseen, which may be required to comply with the foregoing requirements of
this Paragraph 12(a). Landlord shall not be required to make any Alteration,
whether foreseen or unforeseen, or to maintain any of the Leased Premises or
Adjoining Property in any way, and Tenant hereby expressly waives any right
which may be provided for in any Law now or hereafter in effect to make
Alterations at the expense of Landlord or to require Landlord to make
Alterations. Any Alteration made by Tenant pursuant to this Paragraph 12 shall
be made in conformity with the provisions of Paragraph 13.
(b) If any Improvement hereafter constructed shall (i) encroach upon
any setback or any property, street or right-of-way adjoining the Leased
Premises, (ii) violate the provisions of any restrictive covenant affecting the
Leased Premises, (iii) hinder or obstruct any easement or right-of-way to which
the Leased Premises is subject or (iv) impair the rights of others in, to or
under any of the foregoing, Tenant shall, promptly after receiving notice from
an interested party, either (A) obtain from all necessary parties waivers or
settlements of all claims, liabilities and damages resulting from each such
encroachment, violation, hindrance, obstruction or impairment, whether the same
shall affect Landlord, Tenant or both, or (B) take such action as shall be
necessary to remove all such encroachments, hindrances or obstructions and to
end all such violations or impairments, including, if necessary, making
Alterations.
13. Alterations and Improvements.
(a) Tenant shall have the right, without having obtained the prior
written consent or Landlord and Lender, to (i) make non-structural Alterations
to the interior of the Improvements (including, without limitation,
construction, removal or relocation of partition walls, but excluding interior
stairways), without limitation as to amount so long as the primary use of the
Improvements is manufacturing and distribution and to install, remove and/or
relocate Tenant's Equipment, or (ii) make any other non-structural Alterations
or a series of related non-structural Alterations that, as to any such
Alterations or series of related Alterations, do not cost in excess of ten
percent (10%) of the Acquisition Cost of the Leased Premises, (iii) install
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Equipment in the Improvements or accessions to the Equipment that, as to such
Equipment or accessions, do not cost in excess of len percent (10%) of the
Acquisition Cost of the Leased Premises so long as at the time of construction
or installation of any such Equipment, Alterations or expansion no Event of
Default exists and the value and utility of the Leased Premises is not
diminished thereby in any material respect. If Tenant desires to make any
Alterations not permitted above, the prior written approval of Landlord and
Lender shall be required, which shall not be unreasonably withheld or delayed.
Except as provided in this Paragraph 13(a) Tenant shall not construct upon the
Land any additional buildings without having first obtained the prior written
consent of Landlord and Lender, which shall not be unreasonably withheld or
delayed. Landlord shall have the right to require Tenant to remove and/or
restore any Alterations, other than Alterations (w) required by Law or by this
Lease (including Paragraph 12(a)), (x) permitted pursuant to clause (iv) above
or constituting additional buildings constructed upon the Land with the consent
of Landlord and Lender, or(y) with respect to which Landlord has agreed in
writing, as provided below, are not required to be removed or restored. Tenant
shall have the right, with respect to any Alteration that Tenant would otherwise
be required to remove or restore pursuant to the preceding sentence, to give
notice to Landlord describing such Alteration and requesting that Landlord
determine whether or not such Alteration will be required to be removed or
restored at the end of the Term. Within ten (10) Business Days after receipt of
Tenant's notice, Landlord shall give notice to Tenant informing Tenant whether
Landlord will require removal or restoration of such Alteration at the
expiration of the Term; provided, that Landlord shall act reasonably in
determining whether or not to require such restoration or removal.
(b) If Tenant makes any Alterations pursuant to this Paragraph 13 or
as required by Paragraph 12 or 17, whether or not Landlord's consent is
required, then (i) the market value of the Leased Premises shall not be lessened
by any such Alterations in any material respect or its usefulness impaired in
any material respect, (ii) all such Alterations shall be performed by Tenant in
a good and workmanlike manner, (iii) all such Alterations shall be expeditiously
completed in compliance with all Legal Requirements, (iv) all such Alterations
shall comply with the Insurance Requirements, (v) if any such Alterations
involve the replacement of Equipment or parts thereto, all replacement Equipment
or parts shall be in good repair and condition and fit for its intended use and
shall have a value and useful life equal to or greater than the value and useful
life of the Equipment being replaced immediately prior to the occurrence of the
event which required its replacement (assuming such replaced Equipment was then
in the condition required by this Lease), (vi) Tenant shall promptly discharge
or remove all liens filed against any of the Leased Premises arising out of such
Alterations, (vii) Tenant shall procure and pay for all permits and licenses
required in connection with any such Alterations, (viii) all such Alterations
shall be the property of Landlord and shall be subject to this Lease, and Tenant
shall execute and deliver to Landlord any document reasonably requested by
Landlord evidencing the assignment to Landlord of all estate, right, title and
interest (other than the leasehold estate created hereby) of Tenant or any other
Person thereto or therein, and (ix) Tenant shall comply, to the extent requested
by Landlord or required by this Lease, with the provisions of Paragraphs 12(a)
and the applicable provisions of Paragraph 19(a), whether or not such
Alterations involve restoration of the Leased Premises.
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14. Permitted Contests. Notwithstanding any other provision of this Lease,
Tenant shall not be required to (a) pay any Imposition, (b) discharge or remove
any lien referred to in Paragraph 11 or 13, (c) take any action with respect to
any encroachment, violation, hindrance, obstruction or impairment referred to in
Paragraph 12(b), or (d) comply with any Law or Legal Requirement including
Environmental Laws (such non-compliance, with the terms hereof being hereinafter
referred to collectively as "Permitted Violations"), so long as at the time of
such contest no Event of Default exists and so long as Tenant shall contest, in
good faith and in accordance with all applicable Laws, the existence, amount or
validity thereof, the amount of the damages caused thereby, or the extent of its
or Landlord's liability therefor by appropriate proceedings which shall operate
during the pendency thereof to prevent or stay (i) the collection from, or other
realization upon the Leased Premises or the Rent as a result of, the Permitted
Violation so contested, (ii) the imminent sale, forfeiture or loss of any of the
Leased Premises or any Rent to satisfy or to pay any damages caused by any
Permitted Violation, (iii) any interference with the payment of any Rent, or
(iv) the cancellation of any insurance policy affecting the Leased Premises or a
statement by the carrier that coverage will be denied. Tenant shall provide
Landlord security which is satisfactory, in Landlord's reasonable judgment, to
assure that such Permitted Violation is corrected, including all Costs, interest
and penalties that may be incurred or become due in connection therewith. While
any proceedings which comply with the requirement of this Paragraph 14 are
pending and the required security is held by Landlord, Landlord shall not have
the right to correct any Permitted Violation thereby being contested unless
Landlord is required by law to correct such Permitted Violation and Tenant's
contest does not prevent or stay such requirement as to Landlord. Each such
contest shall be promptly and diligently prosecuted by Tenant to a final
conclusion, except that Tenant, so long as the conditions of this Paragraph 14
are at all times complied with, has the right to attempt to settle or compromise
such contest through negotiations Tenant shall pay any and all losses,
judgments, decrees and Costs in connection with any such contest and shall,
promptly after the final determination of such contest, fully pay and discharge
the amounts which shall be levied, assessed, charged or imposed or be determined
to be payable therein or in connection therewith, together with all penalties,
fines, interest and Costs thereof or in connection therewith, and perform all
acts the performance of which shall be ordered or decreed as a result thereof.
No such contest shall subject Landlord to the risk of any criminal liability or,
unless paid by Tenant, civil liability.
15.Indemnification.
(a) Tenant shall pay, protect, indemnify, defend, save and hold
harmless Landlord, Lender and all other Persons described in Paragraph 30 (each
an "Indemnitee") from and against any and all liabilities, losses, damages
(including punitive damages), penalties, Costs (including reasonable legal fees
and costs), causes of action, suits, claims, demands or judgments of any nature
whatsoever, howsoever caused, without regard to the form of action and whether
based on strict liability, negligence or any other theory of recovery at law or
in equity (but excluding Landlord Expenses and any matter caused by the gross
negligence or willful misconduct of the Indemnitee seeking indemnification or
an agent of such Indemnitee) arising from (i) any matter pertaining to the
acquisition (or the negotiations leading thereto) ownership, use, non-use,
occupancy, operation, condition, design, construction,
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maintenance, repair or restoration of the Leased Premises or, to the extent that
Landlord or Tenant has any obligations with respect thereto, the Adjoining
Property, or any liability imputed to such party as the result of Landlord's
ownership of the Leased Premises, (ii) any casualty in any manner arising from
the Leased Premises or Adjoining Property, whether or not Indemnitee has or
should have knowledge or notice of any defect or condition causing or
contributing to said casualty, (iii) any violation by Tenant of any provision of
this Lease, any contract or agreement to which Tenant is a party, any Legal
Requirement or any Permitted Encumbrance or any encumbrance Tenant consented to
(other than the Mortgage or the Assignment) or (iv) any alleged, threatened or
actual Environmental Violation (unless caused by the Indemnitee seeking
indemnification or an agent of such Indemnitee, including (A) liability for
response costs and for costs of removal and remedial action incurred by the
Canadian Government, any provincial or local governmental unit or any other
Person, or damages from injury to or destruction or loss of natural resources,
including the reasonable costs of assessing such injury, destruction or loss,
incurred pursuant to law, (B) liability for costs and expenses of abatement,
correction or clean-up, fines, damages, response costs or penalties which arise
from the provisions of any of the other Environmental Laws and (C) liability for
personal injury or property damage arising under any statutory or common-law
tort theory, including damages assessed for the maintenance of a public or
private nuisance or for carrying on of a dangerous activity.
(b) In case any action or proceeding is brought against any
indemnitee by reason of any such claim, (i) Tenant may, except in the event of a
conflict of interest or a dispute between Tenant and any such Indemnitee (a
"Conflict") or during the continuance of an Event of Default, retain its own
counsel and defend such action (it being understood that Landlord may employ
counsel of its choice to monitor the defense of any such action, the cost of
which shall be paid by Landlord except in the case of a Conflict) and (ii) such
Indemnitee shall notify Tenant to resist or defend such action or proceeding by
retaining counsel reasonably satisfactory to such Indemnitee, and such
indemnitee will cooperate and assist in the defense of such action or proceeding
if reasonably requested so to do by Tenant. In the event of a Conflict or during
the continuance of an Event of Default, Landlord shall have the right to select
counsel, and the cost of such counsel shall be paid by Tenant.
(c) The obligations of Tenant under this Paragraph 15 shall survive
any termination, expiration or rejection in bankruptcy of this Lease with
respect to any matter that occurred or existed to such termination, expiration
or rejection.
16. Insurance.
(a) Tenant shall maintain the following insurance on or in
connection with the Leased Premises:
(i) Insurance against all risk of physical loss or damage to
the Improvements and Equipment as provided under "Special Causes of Loss" form
coverage, and including customarily excluded perils of hail, windstorm, flood
coverage, earthquake and, to the extent required by Lender, terrorism insurance
in amounts not less than the actual replacement cost of the Improvements and
Equipment; provided that, if Tenant's insurance company is unable
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or unwilling to include any of all of such excluded perils, Tenant shall have
the option of purchasing coverage against such perils from another insurer on a
"Difference in Conditions" form or through a stand-alone policy. Such policies
shall contain Replacement Cost and Agreed Amount Endorsements and "Law and
Ordinance" coverage (at full replacement cost). Such Policies and endorsements
shall contain deductibles not more than $100,000 per occurrence.
(ii) Commercial General Liability Insurance (including but not
limited to Incidental Medical Malpractice and Host Liquor Liability) and
Business Automobile Liability Insurance (including Non-Owned and Hired
Automobile Liability) against claims for personal and bodily injury, death or
property damage occurring on, in or as a result of the use of the Leased
Premises, in an amount not less than $1,000,000 per occurrence and $15,000,000
U.S. Dollars excess liability on a claims occurrence basis, and all other
coverage extensions that are usual and customary for properties of this size and
type provided, however, that the Landlord shall have the right to require such
higher limits as may be reasonable and customary for properties of this size and
type.
(iii) Workers' compensation insurance covering all persons
employed by Tenant in connection with any work done on or about any of the
Leased Premises for which claims for death, disease or bodily injury may be
asserted against Landlord, Tenant or any of the Leased Premises or, in lieu of
such Workers' Compensation Insurance, a program of self-insurance complying
with the rules, regulations and requirements of the appropriate agency of the
Province.
(iv) Comprehensive Boiler and Machinery Insurance on any of
the Equipment or any other equipment on or in the Leased Premises, in an
amount not less than $6,500,000 per accident for damage to property. Either such
Boiler and Machinery policy or the All-Risk policy required in (i) above may
contain a deductible not to exceed $100,000 and shall include at least
$4,000,000 per incidence for Off-Premises Service Interruption, and at least
$150,000 per incidence for Expediting Expenses, Ammonia Contamination and
Hazardous Materials Clean-Up Expense.
(v) Business Income/Extra Expense Insurance at limits
sufficient to cover 100% of the period of indemnity not less than one year from
time of loss plus a six month extended period of indemnity. Such insurance shall
name Landlord as loss payee solely with respect to Rent payable to or for the
benefit of Landlord as its interest appears under this Lease.
(vi) During any period in which substantial Alterations at the
Leased Premises are being undertaken, builder's risk insurance covering the
total completed value including any "soft costs" with respect to the
Improvements being altered or repaired (on a completed value, non-reporting
basis), replacement cost of work performed and equipment, supplies and materials
furnished in connection with such construction or repair of Improvements or
Equipment, together with such "soft cost" endorsements and such other
endorsements as Landlord may reasonably require and general liability, worker's
compensation and automobile liability insurance with respect to the Improvements
being constructed, altered or repaired.
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(vii) Such other insurance (or other terms with respect to any
insurance required pursuant to this Paragraph 16, including without limitation
amounts of coverage, deductibles, form of mortgagee clause) on or in connection
with any of the Leased Premises as Landlord or Lender may reasonably require,
which at the time is usual and commonly obtained in connection with properties
similar in type of building size, use and location to the Leased Premises.
(b) The insurance required by Paragraph 16(a) shall be written by
companies which have a Best's rating of A:X or above and a claims paying ability
rating of A or better by S&P or equivalent rating agency approved by Landlord
and Lender and are admitted in, and approved to write insurance policies by, the
State Insurance Department for the State. Notwithstanding the foregoing,
Landlord and Lender shall, with respect to the insurance required pursuant to
Paragraph 16(a)(i), accept policies written by Factory Mutual Insurance Company
("F.M. Global") during any period while F.M. Global does not have an A or better
S&P claims paying ability rating so long as F.M. Global has a Best's rating of
A:X or above. The insurance policies (i) shall be for such terms as Landlord may
reasonably approve and (ii) shall be in amounts sufficient at all times to
satisfy any coinsurance requirements thereof. The insurance referred to in
Paragraphs 16(a)(i), 16(a)(iv) and 16(a)(vi) shall name Landlord as Owner and
Lender as loss payee, as its interest may appear, and Tenant as its interest may
appear. The insurance referred to in Paragraph 16(a)(ii) shall name Landlord and
Lender as additional insureds, and the insurance referred to in Paragraph
16(a)(v) shall name Landlord as insured and Lender and Landlord as loss payees,
as their respective interests may appear. If said insurance or any part thereof
shall expire, be withdrawn, become void, voidable, unreliable or unsafe for any
reason, including a breach of any condition thereof by Tenant or the failure or
impairment of the capital of any insurer, or if for any other reason whatsoever
said insurance shall become reasonably unsatisfactory to Landlord, Tenant shall
immediately obtain new or additional insurance reasonably satisfactory to
Landlord.
(c) Each insurance policy referred to in clauses (i), (iv), (v) and
(vi) of Paragraph 16(a) shall contain standard non-contributory mortgagee
clauses in favor of and acceptable to Lender. Each policy required by any
provision of Paragraph 16(a), except clause (iii) thereof, shall provide that it
may not be cancelled, substantially modified or allowed to lapse on any renewal
date except after thirty (30) days' prior notice to Landlord and Lender. Each
such policy shall also provide that any loss otherwise payable thereunder shall
be payable notwithstanding (i) any act or omission of Landlord or Tenant which
might, absent such provision, result in a forfeiture of all or a part of such
insurance payment, (ii) the occupation or use of any of the Leased Premises for
purposes more hazardous than those permitted by the provisions of such policy,
(iii) any foreclosure or other action or proceeding taken by Lender pursuant to
any provision of the Mortgage, Note, Assignment or other document evidencing or
securing the Loan upon the happening of an event of default therein or (iv) any
change in title to or ownership of any of the Leased Premises.
(d) Tenant shall pay as they become due all premiums for the
insurance required by Paragraph 16(a), shall renew or replace each policy and
deliver to Landlord evidence of the payment of the full premium therefor or
installment then due at least
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thirty (30) days prior to the expiration date of such policy, and shall promptly
deliver to Landlord all original certificates of insurance or, if required by
Lender, original or certified policies.
(e) Anything in this Paragraph 16 to the contrary notwithstanding,
any insurance which Tenant is required to obtain pursuant to Paragraph 16(a) may
be carried under a "blanket" or umbrella policy or policies covering other
properties or liabilities of Tenant, provided (that such "blanket" or Umbrella
policy or policies otherwise comply with the provisions of this Paragraph 16 and
provided further that Tenant shall provide to Landlord a Statement of Values
which shall be reviewed annually and amended as necessary based on Replacement
Cost Valuations. The original or a certified copy of each such "blanket" or
umbrella policy shall promptly be delivered to Landlord.
(f) Tenant shall promptly comply with and conform to (i) all
provisions of each insurance policy required by this Paragraph 16 and (ii) all
requirements of the insurers thereunder applicable to Landlord, Tenant or any of
the Leased Premises or to the use, manner of use, occupancy, possession,
operation, maintenance, alteration or repair of any of the Leased Premises, even
if such compliance necessitates Alterations or results in interference with the
use or enjoyment of any or the Leased Premises.
(g) Tenant shall not carry separate insurance concurrent in form or
contributing in the event of a Casualty with that required in this Paragraph 16
unless (i) Landlord and Lender are included therein as named insureds, with loss
payable as provided herein, and (ii) such separate insurance complies with the
other provisions of this Paragraph 16. Tenant shall immediately notify Landlord
of such separate insurance and shall deliver to Landlord the original policies
or certified copies thereof.
(h) All policies shall contain effective waivers by the carrier
against all claims for insurance premiums against Landlord and shall contain
full waivers of subrogation against the Landlord.
(i) All proceeds of any insurance required under Paragraph 16(a)
shall be payable as follows:
(i) Proceeds payable under clauses (ii), (iii) and (iv) of
Paragraph 16(a) and proceeds attributable to the general liability coverage of
Builder's Risk insurance under clause (vi) of Paragraph 16(a) shall be payable
to the person entitled to receive such proceeds.
(ii) Proceeds of insurance required under clause (i) of
Paragraph 16(a) and proceeds attributable to Builder's Risk insurance (other
than its general liability coverage provisions) under clause (vi) of Paragraph
16(a) shall be payable to Landlord or Lender and applied as set forth in
Paragraph 17 or, if applicable, Xxxxxxxxx x0. Tenant shall apply the Net Award
to restoration of the Leased Premises in accordance with the applicable
provisions of this Lease unless a Termination Event shall have occurred and
Tenant has given a Termination Notice.
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17. Casualty and Condemnation.
(a) If any Casualty to the Leased Premises occurs the insurance
proceeds of which are reasonably likely to be in excess of One Hundred Fifty
Thousand Dollars ($150,000), Tenant shall give Landlord and Lender immediate
notice thereof. So long as no Event of Default then exists Tenant is hereby
authorized to adjust, collect and compromise all claims under any of the
insurance policies required by Paragraph 16(a) (except public liability
insurance claims payable to a Person other than Tenant, Landlord or Lender) and
to execute and deliver on behalf of Landlord all necessary proofs of loss,
receipts, vouchers and releases required by the insurers and Landlord shall have
the right to join with Tenant therein. Any final adjustment, settlement or
compromise of any such claim in excess of $325,000 shall be subject to the prior
written approval of Landlord, which approval shall not be unreasonably withheld
or delayed, and Landlord shall have the right to require Tenant to prosecute or
contest any such claim, adjustment, settlement or compromise. If an Event of
Default then exists, (i) Tenant shall not be entitled to adjust, collect or
compromise any such claim or to participate with Landlord in any adjustment,
collection and compromise of the Net Award payable in connection with a
Casualty, (ii) Tenant agrees to sign, upon the request of Landlord, all such
proofs of loss, receipts, vouchers and releases, (iii) each insurer is hereby
authorized and directed to make payment under said policies, including return
of unearned premiums, directly to Landlord or, if required by the Mortgage, to
Lender instead of to Landlord and Tenant jointly, and Tenant hereby appoints
each of Landlord and Lender as Tenant's attorneys-in-fact to endorse any draft
therefor. The rights of Landlord under this Paragraph 17(a) shall be extended to
Lender if and to the extent that any Mortgage so provides.
(b) Tenant, immediately upon receiving a Condemnation Notice, shall
notify Landlord and Lender thereof. So long as no Event of Default exists,
Tenant is authorized to collect, settle and compromise the amount of any Net
Award and Landlord shall have the right to join with Tenant herein. If an Event
of Default exists, Landlord shall be authorized to collect, Settle and
compromise the amount of any Net Award and Tenant shall not be entitled to
participate with Landlord in any Condemnation proceeding or negotiations under
threat thereof or to contest the Condemnation or the amount of the Net Award
therefor. No agreement with any expropriating body or condemnor in settlement or
under threat of any Condemnation shall be made by Landlord or Tenant without the
written consent of the other party, not to be unreasonably withheld or delayed.
Upon receipt, any Net Award shall be distributed first, to Landlord, up to an
amount equal to the sum of the Acquisition Cost and the applicable Prepayment
Premium which Landlord will be required to pay in prepaying any Loan with the
proceeds of the Net Award, then to Tenant up to an amount equal to the value of
Tenant's leasehold estate hereunder and the value of any expansion or addition
or any additional buildings constructed by Tenant during the Term, and, any
balance of such Net Award to Landlord. Moreover, nothing in this Lease (i) shall
impair Tenant's right to any award or payment on account of Tenant's trade
fixtures, equipment or other tangible property which is not part of the
Equipment, moving expenses or loss of business, if available, to the extent that
and so long as (A) Tenant shall have the right to make, and does make, a
separate claim therefor against the condemnor and (B) such claim does not in
any way reduce the amount of the Net Award or, if Tenant gives a Termination
Notice to Landlord, affect the obligations of Tenant under Paragraph
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18 hereof to pay the Termination Amount. The rights of Landlord under this
Paragraph 17(b) shall also be extended to Lender if and to the extent that any
Mortgage so provides.
(c) If any Casually (whether or not insured against) or Partial
Condemnation shall occur, this Lease shall continue, notwithstanding such event,
and there shall be no abatement or reduction of any Monetary Obligations, except
as provided in Paragraph 19(c). Promptly after such Casualty or Partial
Condemnation, Tenant, as required in Paragraph 12(a), shall commence and
diligently continue to restore the Leased Premises as nearly as possible to
their value, condition and character immediately prior to such event (assuming
the Leased Premises to have been in condition required by this Lease). So long
as no Event of Default exists, any Net Award up to and including $325,000 shall
be paid by Landlord to Tenant and Tenant shall restore the Leased Premises in
accordance with the requirements of Paragraph 13(b) of this Lease. Any Net Award
in excess of $325,000 shall (unless such Condemnation resulting in the Net Award
is a Termination Event) be made available by Landlord (or Lender, if required by
the terms of any Mortgage) to Tenant for the restoration of any of the Leased
Premises pursuant to and in accordance with the provisions of Paragraph 19
hereof. If any Condemnation which is not a Partial Condemnation shall occur,
Tenant shall comply with the terms and conditions of Paragraph 18.
18. Termination Events.
(a) If (i) the entire Leased Premises shall be taken by a
Condemnation or (ii) any substantial portion of the Leased Premises shall be
taken by a Condemnation and, in the case of clause (ii), Tenant certifies and
covenants to Landlord that it will be unable to continue to conduct its business
at the Leased Premises and that it will forever abandon operations at the Leased
Premises (each of the events described in the above clauses (i) and (ii) shall
hereinafter be referred to as a "Termination Event"), then Tenant shall have the
option, within sixty (60) days after Tenant receives a Condemnation Notice to
give to Landlord written notice in the form described in Paragraph 18(b) of the
Tenant's election to terminate this Lease (a "Termination Notice"). If Tenant
elects under clause (ii) above not to give Landlord a Termination Notice, (then
Tenant shall rebuild or repair the Leased Premises in accordance with Paragraphs
17 and 19.
(b) A Termination Notice shall contain (i) notice of Tenant's
intention to terminate this Lease as to the Affected Premises on the first Basic
Rent Payment Date which occurs at least sixty (60) days after the date of the
Termination Notice (the "Termination Date") (ii) if the Termination Event is an
event described in Paragraph 18(a)(ii), the certification and covenants
described (therein and a certified resolution of the Board of Directors of
Tenant authorizing the same.
(c) This Lease shall terminate on the Termination Date; provided
that, if Tenant has not satisfied all Monetary Obligations and all other
obligations and liabilities under this Lease which have arisen on or prior to
the Termination Date (collectively, "Remaining Obligations") on the Termination
Date, then Landlord may, at its option, extend the date on which this Lease may
terminate to a xxxx which is no later than the first Basic Rent Payment
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Date after the Termination Date on which Tenant has satisfied all Remaining
Obligations. Upon such termination (i) all obligations of Tenant hereunder shall
terminate except for any Surviving Obligations, (ii) Tenant shall immediately
vacate and shall have no further right, title or interest in or to any of the
Leased Premises and (iii) the portion of any Net Award payable to Landlord in
the event of a Condemnation shall be retained by Landlord. Notwithstanding
anything to the contrary hereinabove contained, if, on the Termination Date,
Landlord shall not have received the full amount of the Net Award payable to
Landlord by reason of the applicable Termination Event, then the date on which
this Lease is to terminate with respect to the Affected Premises shall be
automatically extended to the first Basic Rent Payment Date after the receipt by
Landlord of the full amount of the Net Award payable to Landlord provided that,
if Tenant has not satisfied all Remaining Obligations on such date, then
Landlord may, at its option, extend the date on which this Lease may terminate
to a date which is no later than the first Basic Rent Payment Date after such
date on which Tenant has satisfied all such Remaining Obligations.
19. Restoration.
(a) So long as no Event of Default has occurred and is continuing
any Net Award up to the amount of Three Hundred Twenty-five Thousand Dollars
$325,000 shall be paid by Landlord to Tenant and applied by Tenant to
restoration of the Leased Premises in accordance with this Lease. Landlord (or
Lender if required by any Mortgage) shall hold Net Award in excess of Three
Hundred Twenty-five Thousand Dollars ($325,000) in a fund (the "Restoration
Fund") and disburse amounts from the Restoration Fund only in accordance with
the following conditions:
(i) prior to commencement of restoration, (A) the architects,
contracts, contractors, plans and specifications for the restoration shall have
been reasonably approved by Landlord, and (B) Landlord and Lender shall be
provided with construction lien insurance (if available) and reasonably
acceptable performance and payment bonds which insure satisfactory completion of
and payment for the restoration, are in an amount and form and have a surety
acceptable to Landlord, and name Landlord and Lender as additional dual
obligees;
(ii) at the time of any disbursement, no Event of Default
shall exist and no construction or materialmen's liens shall have been filed
against any of the Leased Premises and remain undischarged unless the same are
being contested pursuant to the terms of Paragraph 14 hereof;
(iii) disbursements shall be made Form time to time in an
amount not exceeding the amount due on the work completed up until the time of
such disbursement together with any soft costs related thereto, upon receipt of
(A) satisfactory evidence, including architects' certificates, of the stage of
completion, the estimated total cost of completion and performance of the work
to date in a good and workmanlike manner in accordance with the contracts, plans
and specifications, (B) waivers of liens, (C) contractors' and subcontractors'
sworn statements as to completed work and the cost thereof for which payment is
requested, (D) a satisfactory bringdown of title insurance and (E) other
evidence of cost and payment so that Landlord can verify that the amounts
disbursed from time to time are
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represented by work that is completed, in place and free and clear of
construction and materialmen's lien claims and related soft costs;
(iv) each request for disbursement shall be accompanied by a
certificate of Tenant, signed by a duly authorized officer of Tenant, describing
the work for which payment is requested, stating the cost incurred in connection
therewith, stating that Tenant has not previously received payment for such work
and, upon completion of the work, also stating that the work has been fully
completed and complies with the applicable requirements of this lease;
(v) Landlord may retain ten percent (10%) of the Restoration
Fund, to be dealt with in accordance with applicable construction lien
legislation which shall be released on a contract-by-contract basis as the
restoration is completed;
(vi) if the Restoration fund is held by Landlord, the
Restoration Fund shall not be commingled with Landlord's other funds and shall
be invested in an interest-bearing investment permitted pursuant to the Loan,
and the interest therefrom shall became part of the Restoration Fund; and
(vii) such other reasonable conditions as Landlord or Lender
may impose.
(b) Prior to commencement of restoration and at any time during
restoration, if the estimated cost of completing the restoration work free and
clear of all liens, as reasonably determined by Landlord, exceeds the amount of
the Net Award available for such restoration, the amount of such excess shall,
upon demand by Landlord, be paid by Tenant to Landlord to be added to the
Restoration Fund. Any sum so added by Tenant which remains in the Restoration
Fund upon completion of restoration shall be refunded to Tenant. For purposes of
determining the source of funds with respect to the disposition of funds
remaining after the completion of restoration, the Net Award shall be deemed to
be disbursed prior to any amount added by Tenant.
(c) If any sum remains in the Restoration Fund after completion of
the restoration and any refund to Tenant pursuant to Paragraph 19(b), such sum
shall be retained by Landlord or, if required by a Note or Mortgage, paid by
Landlord to a Lender.
20. Intentionally Omitted.
21. Assignment and Subletting; Waiver of Landlord's Liens.
(a) (i) Tenant shall have the right, upon thirty (30) days prior
written notice to Landlord and Lender, with no consent of Landlord or Lender
being required or necessary ("Preapproved Assignment") to assign this Lease by
operation of law or otherwise to any Person ("Preapproved Assignee") that (A)
immediately following such assignment and having given effect thereto will have
a publicly traded unsecured senior debt rating of "Ba1" or better from Xxxxx'x
or a rating of "BB+" or better from S&P (and in the event both of such
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rating agencies cease to furnish such ratings, then a comparable rating by any
rating agency reasonably acceptable to Landlord and Lender) or (B) is and shall
continue to be for the balance of the Term to be a wholly-owned subsidiary of
any Tenant.
(ii) If Tenant desires to assign this Lease, whether by
operation of law or otherwise, to a Person ("Non-Preapproved Assignee") who
would not be a Preapproved Assignee ("Non-Preapproved Assignment") then Tenant
shall, not less than thirty (30) days prior to the date on which it desires to
make a Non-Preapproved Assignment submit to Landlord and Lender financial and
background information and other information reasonably required by Landlord and
Lender with respect to the Non-Preapproved Assignee (collectively, the "Review
Criteria"). Landlord and Lender shall review such information and shall approve
or disapprove the Non-Preapproved Assignee, which approval shall not be
unreasonably withheld or delayed, no later than the tenth (10th) Business Day
fallowing receipt of all such information, and Landlord and Lander shall be
deemed to have acted reasonably in granting or withholding consent if such grant
or disapproval is based on their review of the Review Criteria applying prudent
business judgment, taking into account the value of the Leased Premises and the
creditworthiness of Tenant and the proposed assignee, in both cases on a
proforma basis after such assignment and having given effect thereto. In the
event that Landlord and/or Lender shall have not responded to Tenant's request
for approval within such ten (10) Business Day period, Tenant may deliver to
Landlord a second written request for approval and Landlord will be deemed to
have consented do such assignment if it does not notify Tenant that it is
withholding its consent within ten (10) Business Days after its receipt of the
second written request.
(b) Tenant shall have the right, upon thirty (30) days prior written
notice to Landlord and Lender, and with no consent or approval of Landlord or
Lender being required or necessary, to enter into a sublease than demises one
hundred percent (100%) of the gross space in the Improvements with any (i)
Affiliate, or (ii) Person that purchases Tenant's business (each, a "Preapproved
Sublet"). Other than pursuant to Preapproved Sublets, at no time during the Term
shall any Related Premises be subject to subleases without the prior written
consent of Landlord and, to the extent required under any Mortgage or other
documents with respect to any Loan, Lender, which consent shall not be
unreasonably withheld or delayed, and which shall be granted or withheld based
on a review of the Review Criteria as they relate to the proposed sublessee.
Landlord and Lender shall be deemed to have acted reasonably in granting or
withholding consent if such grant or disapproval is based on their review of the
Review Criteria, applying prudent business judgment, taking into account the
value of the Leased Premises and the creditworthiness of Tenant and the proposed
sublessee.
(c) If Tenant assigns all its rights and interest under this Lease,
the assignee under such assignment shall expressly assume all the obligations of
Tenant hereunder, actual or contingent including obligations of Tenant which may
have arisen on or prior to the date of such assignment, by a written instrument
delivered to Landlord at the time of such assignment Each sublease of any of the
Leased Premises shall be subject and subordinate to the provisions of this
Lease. No assignment or sublease shall affect or reduce any of the obligations
of Tenant hereunder, and all such obligations, shall continue in full force and
effect as obligations of a principal and not as obligations of a guarantor, as
if no assignment or sublease had been
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made. No assignment or sublease shall impose any additional obligations on
Landlord under this Lease.
(d) Notwithstanding any provision in this Paragraph 21 or elsewhere
in this Lease to the contrary, including any right or option Tenant may have to
assign this Lease or sublease all or any portion of the Leased Premises without
Landlord's consent, Tenant shall, upon the request of Landlord, provide and
cause such assignee or sublessee to provide, such information (including,
without limitation, any certification) as to any proposed assignee or sublessee
and its principals as may be required for Landlord and Tenant to comply with
regulations administered by the Office of Foreign Asset Control ("OFAC") of the
Department of the Treasury, codified at 31 C.F.R. Part 500 (including those
named on OFAC's Specially Designated and Blocked Persons list) or under any
statute, executive order (including the September 24, 2001. Executive Order
Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten
to Commit, or Support Terrorism), or other governmental action regarding persons
or entities with whom U.S. persons or entities are restricted from doing
business.
(e) With respect to any Preapproved Assignment or Preapproved
Sublet, Tenant shall provide to Landlord information reasonably required by
Landlord to establish that any proposed Preapproved Assignment or Preapproved
Sublet satisfies the criteria set forth above.
(f) Tenant shall, within ten (10) Business Days after the execution
and delivery of any assignment or sublease, deliver a duplicate original copy
thereof to Landlord which, in the event of an assignment, shall be together with
a transfer of caveat, in registerable form, with respect thereto.
(g) As security for performance of its obligations under this Lease,
Tenant hereby grants, conveys and assigns to Landlord all right, title and
interest of Tenant in and to all subleases now in existence or hereafter entered
into for any or all of the Leased Premises, any and all extensions,
modifications and renewals thereof and all rents, issues and profits therefrom.
Landlord hereby grants to Tenant a license to collect and enjoy all rents and
other sums of money payable under any sublease of any of the Leased Premises,
provided, however, that Landlord shall have the absolute right at any time upon
notice to Tenant and any subtenants to revoke said license and to collect such
rents and sums of money and to retain the same. Tenant shall apply the same to
amounts then due to Landlord hereunder, with any balance paid to Tenant. Tenant
shall not accept any rents more than thirty (30) days in advance of the accrual
thereof.
(h) Landlord hereby waives (i) any right to distrain trade fixtures,
inventory and other personal property of Tenant and (ii) any Landlord's lien or
similar lien upon Tenant's Equipment, inventory and any other personal property
of Tenant regardless of whether such lien is created by statute or otherwise. At
the request of Tenant, Landlord shall execute a waiver of any Landlord's or
similar lien for the benefit of any holder of a security interest in or lessor
of any of Tenant's Equipment, inventory or any other personal property of Tenant
and
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shall agree in writing to grant reasonable access to such holder for the purpose
of removing any such property, including without limitation, Tenant's Equipment.
Landlord agrees to acknowledge (in a written form reasonably satisfactory to
Landlord) to such persons and entities at such times and for such purposes as
Tenant may reasonably request that Tenant's Equipment owned by Tenant are
Tenant's property and not part of the Leased Premises (regardless of whether or
to what extent Tenant's Equipment and/or other personal property are affixed to
the Leased Premises) or otherwise subject to the terms of this Lease.
(i) Landlord may sell or transfer the Leased Premises at any time
without Tenant's consent to any third party (each a "Third Party Purchaser") In
the event of any such transfer, Tenant shall attorn to any Third Party Purchaser
as Landlord so long as such Third Party Purchaser and Landlord notify Tenant in
writing of such transfer and the Third Party Purchaser expressly assumes
Landlord's obligations under this Lease. At the request of Landlord, Tenant will
execute such documents confirming the agreement referred to above and such other
agreements as Landlord may reasonably request, provided that such agreements do
not increase the liabilities and obligations of Tenant hereunder. The Landlord
shall be released from all obligation pursuant to this Lease upon delivery of
the transfer and Third Party Purchaser assumption of the Landlord's obligations
under this Lease.
22. Events of Default.
(a) The occurrence of any one or more of the following (after
expiration of any applicable cure period as provided in Paragraph 22(b)) shall,
at the sole option of Landlord, constitute an "Event of Default" under this
Lease:
(i) a failure by Tenant to make any payment of any Monetary
Obligation, regardless of the reason for such failure;
(ii) a failure by Tenant duly to perform and observe, or a
violation or breach of, any other provision hereof not otherwise specifically
mentioned in this Paragraph 22(a);
(iii) any representation or warranty made by Tenant herein or
in any certificate, demand or request made pursuant hereto proves to be
incorrect, now or hereafter, in any material respect;
(iv) a default beyond any applicable cure period or at
maturity by Tenant or any Guarantor in any payment of principal or interest on
any obligations for borrowed money having an original principal balance of
$5,000,000 U.S. Dollars or more in the aggregate, or in the performance of any
other provision contained in any instrument under which any such obligation is
created or secured (including the breach of any covenant thereunder), (x) if
such payment is a payment at maturity or a final payment unless the lender shall
have extended such maturity date in writing, or (y) if an effect of such default
is to cause such obligation to be accelerated prior to its stated maturity;
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(v) (1) a final, non-appealable, uninsured judgment or
judgments for the payment of money in excess of $30,000,000 U.S. Dollars in the
aggregate shall be rendered against any Tenant or any Guarantor and the same
shall remain undischarged for a period of sixty (60) consecutive days;
(2) Tenant or any Guarantor shall default beyond any
applicable cure period in the payment of rent under or in the performance of any
other material provision of, any other lease or leases that have, in the
aggregate, rental obligations over the terms thereof of $3,000,000 or more.
(vi) any Tenant or any Guarantor shall (A) voluntarily be
adjudicated a bankrupt or insolvent, (B) seek or consent to the appointment of a
receiver or trustee for itself or for the Leased Premises, (C) file a petition
seeking relief under the bankruptcy or other similar laws of Canada or of the
United States, any province or state or any jurisdiction, (D) make a general
assignment for the benefit of creditors, or (E) be unable to pay its debts as
they mature;
(vii) a court shall enter an order, judgment or decree
appointing, without the consent of Tenant, a receiver or trustee for it or for
any of the Leased Premises or approving a petition filed against Tenant or any
Guarantor which seeks relief under the bankruptcy or other similar laws of
Canada or the United States, any province or state or any jurisdiction, and such
order, judgment or decree shall remain undischarged or unstayed ninety (90) days
after it is entered;
(viii) the Leased Premises shall have been vacated for more
than three hundred sixty-five (365) consecutive days;
(ix) (A) Tenant or any Guarantor shall be liquidated or (B)
Tenant or any Guarantor shall be dissolved or shall begin proceedings towards
its liquidation or dissolution;
(x) the estate or interest of Tenant in any of the Leased
Premises shall be levied upon or attached in any proceeding and such estate or
interest is about to be sold or transferred or such process shall not be
vacated or discharged within ninety (90) days after it is made;
(xi) a failure by Tenant to perform or observe, or a violation
or breach of, or a misrepresentation by Tenant under, any provision of any
Assignment to which Tenant is a party or any other document between Tenant and
Lender, if such failure, violation, breach or misrepresentation gives rise to a
default beyond any applicable cure period with respect to any Loan; provided
that Landlord has promptly given Tenant a copy of any notice Landlord shall have
received regarding such default;
(xii) Tenant shall sell or transfer or enter into an agreement
to sell or transfer all or more than 75% of the fair market value of its assets
unless such Tenant's leasehold interest in this Lease is sold or transferred as
part of such transaction and the buyer or
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transferee assumes all of the obligations of such Tenant under the terms of
Paragraph 21(c) of the Lease;
(xiii) an Event of Default (as defined in the Guarantee)
beyond any applicable cure period shall occur under the Guarantee;
(xiv) Tenant shall fail to comply with the provisions of
Paragraph 25 or Paragraph 32 of this Lease; or
(xv) Tenant's failure to timely comply with any of Tenant's
Post Closing Obligations and such failure continues for ten (10) Business Days
after written notice from Landlord.
(b) No notice or cure period shall be required in any one or more of
the following events: the occurrence of an Event of Default under clause (iv),
(v), (vi), (vii), (viii), (ix), (X), (xi), (xii), (xiii) or (XV) of Paragraph
22(a). If the default consists of the failure to pay Basic Rent, the applicable
cure period shall be five (5) Business Days from the date on which notice of
such default is given, provided, that Landlord shall not be obligated to give
notice of any such default more than one time during any Lease Year, provided,
further that even where Landlord is not required to give notice of any such
default by operation of the immediately preceding proviso. Tenant nevertheless
shall be entitled to a grace period of five (5) Business Days. If the default
consists of the failure to pay any other Monetary Obligation or a default under
clause (xiv) of Paragraph 22(a) the applicable cure period shall he five (5)
Business Days after notice from Landlord. If the default consists of a default
under clause (ii) or clause (iii) of Paragraph 22(a) (and provided that any
default under Paragraph 22(a)(iii) is reasonably susceptible of cure), the
applicable cure period shall be thirty (30) days from the date on which notice
is given or, if the default cannot be cured within such thirty (30) day period
and delay in the exercise of a remedy would not (in Landlord's reasonable
judgment) cause any material adverse harm to Landlord or any of the Leased
Premises, the cure period shall be extended for the period required to cure the
default (but such cure period, including any extension, shall not in the
aggregate exceed ninety (90) days), provided that Tenant shall commence to cure
the default within the said thirty-day period and shall actively, diligently and
in good faith proceed with and continue the curing of the default until it shall
be fully cured.
23. Remedies and Damages Upon Default.
(a) If an Event of Default shall have occurred and is continuing,
Landlord shall have the right, at its sole option and to the extent permitted by
applicable Law, to exercise its remedies and to collect damages from Tenant in
accordance with this Paragraph 23, subject in all events to applicable Law,
without demand upon or notice to Tenant except as otherwise provided in
Paragraph 22(b) and this Paragraph 23.
(i) Landlord may give Tenant notice of Landlord's intention to
terminate this Lease on a date specified in such notice. Upon such date, this
Lease, the estate hereby granted and all rights of Tenant hereunder shall
expire and terminate. Upon such
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termination, Tenant shall immediately surrender and deliver possession of the
Leased Premises to Landlord in accordance with Paragraph 26. If Tenant does not
so surrender and deliver possession of the Leased Premises, Landlord may
re-enter and repossess the Leased Premises, by means of legal process, summary
proceedings, ejectment or any other lawful means or procedure. Upon or at any
time after taking possession of the Leased Premises, Landlord may, by peaceable
means or legal process, remove any Persons or property therefrom. Landlord shall
be under no liability for or by reason of any such entry, repossession or
removal. Notwithstanding such entry or repossession, Landlord may (A) exercise
the remedy set forth in and collect the damages permitted by Paragraph
23(a)(iii) or (B) collect the damages set forth in Paragraph 23(b)(i) or
23(b)(ii).
(ii) After repossession of the Leased Premises pursuant to
clause (i) above, Landlord shall have the right to relet any of the Leased
Premises to such tenant or tenants, for such term or terms, for such rent, on
such conditions and for such uses as Landlord in its sole discretion may
determine, and collect and receive any rents payable by reason of such
reletting. Landlord may make such Alterations in connection with such reletting
as it may deem advisable in its sole discretion. Notwithstanding any such
reletting. Landlord may collect the damages set forth in Paragraph 23(b)(ii).
(iii) Landlord may declare by notice to Tenant the entire
Basic Rent (in the amount of Basic Rent then in effect) for the remainder of the
then current Term to be immediately due and payable. Tenant shall immediately
pay to Landlord all such Basic Rent discounted to its Present Value, all accrued
Rent then due and unpaid, all other Monetary Obligations which are then due and
unpaid and all Monetary Obligations which arise or become due by reason of such
Event of Default (including any Costs of Landlord). Upon receipt by Landlord of
all such accelerated Basic Rent and Monetary Obligations, this Lease shall
remain in full force and effect and Tenant shall have the right to possession of
the Leased Premises from the date of such receipt by Landlord to the end of the
Term, and subject to all the provisions of this Lease, including the obligation
to pay all increases in Basic Rent and all Monetary Obligations that
subsequently become due, except that (A) no Basic Rent which has been prepaid
hereunder shall be due thereafter during the said Term and (B) Tenant shall
have no option to extend or renew the Term.
(iv) In addition to any and all other rights available to the
Landlord, the Landlord may upon notice to Tenant declare the full amount of the
current quarterly installment of Basic Rent and of all Additional Rent for the
current quarter (all of which shall be deemed to be accruing on a day-to-day
basis) immediately due and payable as accelerated Rent.
(b) The following constitute damages to which Landlord shall be
entitled if Landlord exercises its remedies under Paragraph 23(a)(i) or
23(a)(ii):
(i) If Landlord exercises its remedy under Paragraph 23(a)(i)
but not its remedy under Paragraph 23(a)(ii) (or attempts to exercise such
remedy and is unsuccessful in reletting the Leased Premises) then, upon written
demand from
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Xxxxxxxx, Xxxxxx shall pay to Landlord, as liquidated and agreed final damages
for Tenant's default and in lieu of all current damages beyond the date of such
demand (it being agreed that it would be impracticable or extremely difficult to
fix the actual damages), an amount equal to the Present Value of the excess, if
any, of (A) all Basic Rent from the date of such demand to the date on which the
Term is scheduled to expire hereunder in the absence of any earlier termination,
re-entry or repossession Over (B) the then fair market rental value of the
Leased Premises for the same period. Tenant shall also pay to Landlord all of
Landlord's Costs in connection with the repossession of the Leased Premises and
any attempted reletting thereof, including all brokerage commissions, legal
expenses attorneys' fees, employees' expenses, costs of Alterations and expenses
and preparation for reletting.
(ii) If Landlord exercises its remedy under Paragraph
23(a)(i) or its remedies under Paragraph 23(a)(i) and 23(a)(ii), then Tenant
shall, until the end of what would have been the Term in the absence of the
termination of the Lease, and whether or not any of the Leased Premises shall
have been relet, be liable, to Landlord for, and shall pay to Landlord, as
liquidated and agreed current damages all Monetary Obligations which would be
payable under this Lease by Tenant in the absence of such termination less the
net proceeds, if any, of any reletting pursuant to Paragraph 23(a)(ii), after
deducting from Such proceeds all of Landlord's Costs (including the items listed
in the lust sentence of Paragraph 23(b)(i) hereof) incurred in connection with
such repossessing and reletting; provided, that if Landlord has not relet the
leased Premises, such Costs of Landlord shall be considered to be Monetary
Obligations payable by Tenant. Tenant shall be and remain liable for all sums
aforesaid, and Landlord may recover such damages from Tenant and institute and
maintain successive actions or legal proceedings against Tenant for the recovery
of such damages. Nothing herein contained shall be deemed to require Landlord to
wait to begin such action or other legal proceedings until the date when the
Term would have expired by its own terms had there been no such Event of
Default.
(c) Notwithstanding anything to the contrary herein contained, in
lieu of or in addition to any of the foregoing remedies and damages, Landlord
may exercise any remedies and collect any damages available to it at law or in
equity; provided, however, if a Limited Remedy Default exists, the aggregate
maximum amount Tenant shall be required to pay to Landlord as a result of such
Limited Remedy Default from and after the date of the occurrence of such Limited
Remedy Default (the "Occurrence Date") shall be limited to the sum of (i) the
present value as of the Occurrence Date, discounted at the annual rate of ten
and one-half percent (10.5%) (taking into account that Basic Rent payments are
required to be made quarterly), of all Basic Rent reserved hereunder for the
unexpired portion of the Term after the Occurrence Date as if this Lease had not
expired or been terminated, (ii) any amounts of Additional Rent which are due
and payable or have accrued under this Lease through the Occurrence Date, and
(iii) any amounts of Additional Rent which are due and payable or have accrued
under this Lease after the Occurrence Date while the Tenant remains in
possession of the Leased Premises or any Related Premises after any Limited
Remedy Default that relates to Impositions, insurance, utilities, repairs,
maintenance, environmental maintenance, remediation and compliance and other
routine and customary costs and expenses of operating and maintaining the Leased
Premises or the Related Premises which remain occupied by Tenant. Nothing
contained in this Paragraph 23(c)
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shall limit any amounts payable by Tenant with respect to Basic Rent or
Additional Rent or indemnification obligation if any Event of Default that is
not a Limited Remedy Default has occurred.
(d) Notwithstanding anything to the contrary herein contained, in
lieu of or in addition to any of the foregoing remedies and damages, landlord
may exercise any remedies and collect any damages available to it at law or in
equity. If Landlord is unable to obtain full satisfaction pursuant to the
exercise of any remedy, it may pursue any other remedy which it has hereunder or
at law or in equity.
(e) Except for retaining a third-party broker to relet the Leased
Premises upon commercially reasonable terms, if this Lease is terminated and
Tenant vacates the Leased Premises pursuant to Paragraph 23(a)(i), Landlord
shall not be required to mitigate any of its damages hereunder unless required
to by applicable Law. If any Law shall validly limit the amount of any damages
provided for herein to an amount which is less than the amount agreed to herein,
Landlord shall be entitled to the maximum amount available under such Law.
(f) No termination of this Lease, repossession or reletting of the
Leased Premises, exercise of any remedy or collection of any damages pursuant to
this Paragraph 23 shall relieve Tenant of any Surviving Obligations.
(g) WITH RESPECT TO ANY REMEDY OR PROCEEDING OF LANDLORD OR TENANT
HEREUNDER, LANDLORD AND TENANT HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY.
(h) Upon the occurrence and during the continuance of any Event of
Default, Landlord shall have the right (but no obligation) to perform any act
required of Tenant hereunder and, if performance of such act requires that
Landlord enter the Leased Premises, Landlord may enter the Leased Premises, at
reasonable times and upon reasonable notice for such purpose.
(i) No failure of Landlord (i) to insist at any time upon the strict
performance of any provision of this Lease or (ii) to exercise any option,
right, power or remedy contained in this Lease shall be construed as a waiver,
modification or relinquishment thereof. A receipt by Landlord of any sum in
satisfaction of any Monetary Obligation with knowledge of the breach of any
provision hereof shall not be deemed a waiver of such breach, and no waiver by
Landlord of any provision hereof shall be deemed to have been made unless
expressed in a writing signed by Landlord.
(j) Tenant hereby waives and surrenders, for itself and all those
claiming under it, including creditors of all kinds, (i) any right and privilege
which it or any of them may have under any present or future Law to redeem any
of the Leased Premises or to have a continuance of this Lease after termination
of this Lease or of Tenant's right of occupancy or possession pursuant to any
court order or any provision hereof, and (ii) the benefits of any present or
future Law which exempts property from liability for debt or for distress for
rent.
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(k) Except as otherwise provided herein, all remedies are cumulative
and concurrent and no remedy is exclusive of any other remedy. Each remedy may
be exercised at any time an Event of Default has occurred and is continuing and
may be exercised from time to time. No remedy shall be exhausted by any exercise
thereof.
24. Notices. All notices, demands, requests, consents, approvals,
offers, statements and other instruments or communications required or permitted
to be given pursuant to the provisions of this Lease shall be in writing and
shall be deemed to have been given and received for all purposes when delivered
in person or by Federal Express or other reliable 24-hour delivery service or
five (5) Business Days after being deposited in the mail in Canada or in the
United States mail, by registered or certified mail, return receipt requested,
postage prepaid, addressed to the other party at its address stated above or
when delivery is refused. A copy of any notice given by Tenant to Landlord shall
simultaneously be given by Tenant to Xxxx Xxxxx LLP, 0000 Xxx Xxxxxxx Xxxxx,
Xxxxxxxxxxxx, XX 00000, Attention: Chairman, Real Estate Department. A copy of
any notice given by Landlord to Tenant shall simultaneously be given by Landlord
to Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx, 1285 Avenue of the Americas, New
York, New York 10019-6064, Attention: Xxxx X. Xxxxxxx. For the purposes of this
Paragraph, any party may substitute another address stated above (or substituted
by a previous notice) for its address by giving fifteen (15) Business Days'
notice of the new address to the other party, in the manner provided above.
25. Estoppel Certificate. At any time upon not less than fifteen (15)
days' prior written request by either Landlord or Tenant (the "Requesting
Party") to the other party (the "Responding Party"), the Responding Party shall
deliver to the Requesting Party a statement in writing, executed by an
authorized officer of the Responding Party, certifying (a) that, except as
otherwise specified, this Lease is unmodified and in full force and effect, (b)
the dates to which Basic Rent, Additional Rent and all other Monetary
Obligations have been paid, (c) that, to the knowledge of the signer of such
certificate and except as otherwise specified, no default by either Landlord or
Tenant exists hereunder, (d) Such other matters as the Requesting Party may
reasonably request including the matters set forth in "Exhibit E-2" and (e) if
Tenant is the Responding Party that, except as otherwise specified, there are no
proceedings pending or, to the knowledge of the signer, threatened, against
Tenant before or by any court or administrative agency which, if adversely
decided, would materially and adversely affect the financial condition and
operations of Tenant. Any such statements by the Responding Party may be relied
upon by the Requesting Party, any Person whom the Requesting Party notifies the
Responding Party in its request for the Certificate is an intended recipient or
beneficiary of the Certificate, any Lender, any Permitted Leasehold Mortgagee or
their assignees and by any prospective purchaser or mortgagee of any interest in
the Leased Premises. Any certificate required under this Paragraph 25 and
delivered by Tenant shall state that, in the opinion of each person signing the
same, he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to the subject matter of such certificate,
and shall briefly state the nature of such examination or investigation.
26. Surrender. Except if Tenant purchases the Leased Premises, upon the
expiration or earlier termination of this Lease, Tenant shall peaceably leave
and surrender the
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Leased Premises to Landlord in the same condition in which the Leased Premises
were at the commencement of this Lease, except as repaired, rebuilt, restored,
altered, replaced or added to as permitted or required by any provision of this
Lease, and except for ordinary wear and tear. Upon such surrender, Tenant shall
(a) remove from the Leased Premises all property which is owned by Tenant or
third parties other than Landlord and (b) repair any damage to the structural
elements of the Improvements or the building systems caused by such removal.
Property not so removed shall become the property of Landlord, and Landlord may
thereafter cause such property to be removed from the Leased Premises. The cost
of removing and disposing of such property and repairing any damage to any of
the Leased Premises caused by such removal shall be paid by Tenant to Landlord
upon demand. Landlord shall not in any manner or to any extent be obligated to
reimburse Tenant for any such property which becomes the property of Landlord
pursuant to this Paragraph 26.
27. No Merger of Title. There shall be no merger of the leasehold estate
created by this Lease with the fee estate in any of the Leased Premises by
reason of the fact that the same Person may acquire or hold or own, directly or
indirectly, (a) the leasehold estate created hereby or any part thereof or
interest therein and (b) the fee estate in any of the Leased Premises or any
part thereof or interest therein, unless and until Landlord, Tenant, Lender and
any Permitted Leasehold Mortgagee shall join in a written instrument effecting
such merger and shall duly record the same.
28. Books and Records.
(a) Tenant shall keep adequate records and books of account with
respect to the finances and business of Tenant generally and with respect to the
Leased Premises, in accordance with accounting principles which are recognized
as being generally accepted in Canada from time to time as set forth in the
handbook published by the Canadian Institute of Chartered Accountants,
consistently applied ("GAAP") and shall permit Landlord and Lender by their
respective agents, accountants and legal counsel, upon reasonable notice to
Tenant, to visit and inspect the Leased Premises and examine (and make copies
of) the records and books of account and to discuss the finances and business
with the officers of Tenant, at such reasonable times as may be requested by
Landlord. Upon the request of Lender or Landlord (either telephonically or in
writing), Tenant shall provide the requesting party with copies of any
information to which such party would be entitled in the course of a personal
visit.
(b) If at any time during the Term, a Tenant shall not be part of
the Guarantor's group for the purpose of reporting financial positions and
results on a consolidated basis, such Tenant shall deliver to Landlord and to
Lender within ninety (90) days of the close of each Fiscal year, annual audited
financial statements of Tenant prepared by a nationally recognized firm of
independent chartered accountants. Tenant shall also furnish to Landlord within
forty-five (45) days after the end of each of the three remaining quarters
unaudited financial statements and all other quarterly reports of Tenant,
certified by Tenant's chief financial officer. All financial statements shall be
prepared in accordance with GAAP consistently applied. All annual financial
statements shall be accompanied (i) by an opinion of said accountants stating
that (A) there are no qualifications as to the scope of the audit and
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(B) the audit was performed in accordance with GAAP. All financial statements
shall be accompanied by the affidavit of the president or a vice president of
Tenant, dated within five (5) Business Days of the delivery of such statement,
stating that (C) the affiant knows of no Event of Default, or event which, upon
notice or the passage of time or both, would become an Event of Default which
has occurred and is continuing hereunder or, if any such event has occurred and
is continuing, specifying the nature and period of existence thereof and what
action Tenant has taken or proposes to take with respect thereto and (D) except
as otherwise specified in such affidavit, that Tenant has fulfilled all of its
obligations under this Lease which are required to be fulfilled on or prior to
the date of such affidavit.
29. Determination of Value.
(a) Whenever a determination of Fair Market Rental Value is required
pursuant to any provision of this Lease, such Fair Market Rental Value shall be
determined in accordance with the fallowing procedure:
(i) Landlord and Tenant shall endeavor to agree on Fair Market
Rental Value on the date (the "Applicable Initial Date") which is six (6)
calendar months prior to the expiration of the then current Term unless Tenant
has previously exercised its option pursuant to Paragraph 5(b) not to have the
Term automatically extended. Upon reaching such agreement, the parties shall
execute an agreement setting forth the amount of such Fair Market Rental Value.
(ii) If the parties shall not have signed such agreement
within thirty (30) days after the Applicable Initial Date, Tenant shall within
fifty (50) days after the Applicable Initial Date select an appraiser and notify
Landlord in writing of the name, address and qualifications of such appraiser.
Within twenty (20) days following Landlord's receipt of such notice, Landlord
shall select an appraiser and notify Tenant of the name, address and
qualifications of such appraiser. If Landlord shall fail to select an appraiser
and notify Tenant as aforesaid within said twenty-day period, then provided that
such failure shall continue for five (5) additional Business Days after notice
thereof from Tenant to Landlord, the determination of Tenant's appraiser shall
govern. Otherwise, such two appraisers shall endeavor to agree upon Fair Market
Rental Value based on a written appraisal made by each of them (and given to
both parties) as of the Relevant Date. If such two appraisers shall agree upon a
Fair Market Rental Value, the amount of such Fair Market Rental Value as so
agreed shall be binding and conclusive upon Landlord add Tenant.
(iii) If such two appraisers shall be unable to agree upon
Fair Market Rental Value within twenty (20) days after the selection of an
appraiser by Landlord, then such appraisers shall advise Landlord and Tenant of
their respective determinations of Fair Market Rental Value and shall select a
third appraiser to make the determination of Fair Market Rental Value. The
selection of the third appraiser shall be binding and conclusive upon Landlord
and Tenant.
(iv) If such two appraisers shall be unable to agree upon the
designation of a third appraiser within ten (10) Business Days after the
expiration of the twenty (20) day period referred to in clause (iii) above, or
if such third appraiser does not make a determination of Fair Market Rental
Value within twenty (20) days after his selection, then such third appraiser or
a substituted third appraiser, as applicable, shall, at the request of either
party hereto, be appointed by the President or Chairman of the American
Arbitration Association in
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Xxx Xxxx, Xxx Xxxx. The determination of Fair Market Rental Value made by the
third appraiser appointed pursuant hereto shall be made within twenty (20) days
after such appointment.
(v) If a third appraiser is selected, Fair Market Rental Value
shall be the average of the determination of Fair Market Rental Value made by
the third appraiser and the determination of Fair Market Rental Value made by
the appraiser (selected pursuant to Paragraph 29(a)(ii) hereof) whose
determination of Fair Market Rental Value is nearer to that of the third
appraiser. Such average shall be binding and conclusive upon Landlord and
Tenant.
(vi) All appraisers selected or appointed pursuant to this
Paragraph 29(a) shall (A) be independent qualified MAI appraisers (B) have no
right, power or authority to alter or modify the provisions of this Lease, (C)
utilize the definition of Fair Market Rental Value set forth herein, and (D) be
registered in the state where the Leased Premises or applicable Related Premises
are located if the state requires such registration. The Cost of the procedure
described in this Paragraph 29(a)(i) clauses (A) through (C) above shall be
shared equally between Landlord and Tenant and the cost of the procedure
described in this Paragraph 29(a)(i)(D) shall be paid by Tenant.
(b) If, by virtue of any delay, Fair Market Rental Value is not
determined by the expiration or termination of the then current Term, then until
Fair Market Rental Value is determined, Tenant shall continue to pay Basic Rent
during the succeeding Renewal Term in the same amount which it was obligated
under this Lease to pay prior to the commencement of the Renewal Term. When Fair
Market Rental Value is determined, the appropriate Basic Rent shall be
calculated retroactive to the commencement of the Renewal Term and Tenant shall
either receive a refund from Landlord (in the case of an overpayment) or shall
pay any deficiency to Landlord (in the case of an underpayment).
(c) In determining Fair Market Rental Value, the appraisers shall
determine with respect to the Leased Premises the amount that a willing tenant
would pay, and a willing landlord of a comparable building located in a radius
of fifty (50) miles of the Leased Premises would accept, at arm's length, to
rent a building of comparable size and quality as the Improvements, taking into
account: (i) the age, quality and condition (as required by the Lease) of the
Improvements and that the Improvements are being leased on an "as-is" basis
without any improvement allowance or free rent; (ii) that the Leased Premises
will be leased as a whole or substantially as a whole to a single user for the
uses permitted under this Lease, (iii) a lease term of ten (10) years, with
annual CPI-based increases; (iv) an absolute triple net lease; and (v) such
other items that professional real estate appraisers customarily consider.
30. Non-Recourse as to Landlord. ANYTHING CONTAINED HEREIN TO THE CONTRARY
NOTWITHSTANDING, ANY CLAIM BASED ON OR IN RESPECT OF ANY LIABILITY OF LANDLORD
UNDER THIS LEASE SHALL BE ENFORCED ONLY AGAINST THE LEASED PREMISES AMD NOT
AGAINST ANY OTHER ASSETS, PROPERTIES OR FUNDS OF (I) LANDLORD, (II) ANY
DIRECTOR, OFFICER, MEMBER, GENERAL PARTNER, SHAREHOLDER, LIMITED PARTNER,
BENEFICIARY, EMPLOYEE OR AGENT OF LANDLORD OR ANY GENERAL PARTNER OF LANDLORD OR
ANY OF ITS MEMBERS OR GENERAL PARTNERS (OR ANY LEGAL
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XXXXXXXXXXXXXX, XXXX, XXXXXX, SUCCESSOR OR ASSIGN OF ANY THEREOF), (III) ANY
PREDECESSOR OR SUCCESSOR PARTNERSHIP OR CORPORATION (OR OTHER ENTITY) OF
LANDLORD OR ANY OF ITS GENERAL PARTNERS, SHAREHOLDERS, OFFICERS, DIRECTORS,
MEMBERS, EMPLOYEES OR AGENTS, EITHER DIRECTLY OR THROUGH LANDLORD OR ITS GENERAL
PARTNERS, SHAREHOLDERS, OFFICERS, DIRECTORS, EMPLOYEES OR AGENTS OR ANY
PREDECESSOR OR SUCCESSOR PARTNERSHIP OR CORPORATION (OR OTHER ENTITY), OR (IV)
ANY PERSON AFFILIATED WITH ANY OF THE FOREGOING, OR ANY DIRECTOR, OFFICER,
EMPLOYEE OR AGENT OF ANY THEREOF.
31. Landlord's Financing.
(a) Tenant agrees to pay directly to Lender, if required by a
Lender, any cost, charge or expense for which Tenant has agreed to reimburse or
indemnify Landlord hereunder.
(b) If Landlord desires to obtain or refinance any Loan, Tenant
shall negotiate in good faith with Landlord concerning any request made by any
Lender or proposed Lender for changes or modifications in this Lease; provided,
that Landlord shall reimburse Tenant for its out-of-pocket costs relating
thereto and provided further that no such change or modification shall increase
Tenants' obligations or decrease Tenant's rights under the Lease in any material
respect. In particular, Tenant shall agree, upon request of Landlord, to supply
any such Lender with such notices and information as Tenant is required to give
to Landlord hereunder and to extend the rights of Landlord hereunder to any such
Lender and to consent to such financing if such consent is requested by such
Lender. Tenant shall provide any other consent or statement and shall execute
any and all other documents that such Lender reasonably requires in connection
with such financing, including any environmental indemnity agreement, so long as
the same do not adversely affect any right, benefit or privilege of Tenant under
this Lease or increase Tenant's obligations under this Lease in any material
respect.
32. Subordination; Non-Disturbance and Attornment. This Lease and Tenant's
interest hereunder shall be subordinate to any Mortgage or other security
instrument hereafter placed upon the Leased Premises by Landlord provided that
the Lender shall have delivered to Tenant an agreement (an "SNDA Agreement") in
a form substantially identical to Exhibit "E-1" annexed hereto and acknowledged
by Lender and such Landlord. Tenant covenants and agrees that Tenant shall enter
into such SNDA Agreement within five (5) Business days following Landlord's
written request and with such modifications as the Lender shall reasonably
request; provided that Paragraph 1 (Subordination) of Exhibit "E-1" shall not be
subject to any modifications, and, provided further that, if Lender requests
substantive modifications to the SNDA Agreement, Tenant shall have such
additional time to negotiate such modifications as is reasonably required based
on the nature and scope of the requested modifications.
33. Tax Treatment; Reporting. Landlord and Tenant each acknowledge that
each shall treat this transaction as a lease for tax purposes and for income tax
purposes each
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shall report this Lease as a lease with Landlord as the owner of the Leased
Premises and Equipment and Tenant as the lessee of such Leased Premises and
Equipment including: (1) treating Landlord as the owner of the Leased Premises
eligible to claim depreciation deductions under applicable tax laws with respect
to the Leased Premises and Equipment but only as the same exist on the date
hereof or are hereafter paid for by Landlord, (2) treating Tenant as the owner
of the property eligible to claim depreciation deductions by Tenant with respect
to the Equipment and Alterations paid for by Tenant and incorporated into the
Leased Premises after the date hereof, (3) Tenant reporting its Rent payments as
rent expense under applicable tax laws, and (4) Landlord reporting the Rent
payments as rental income under applicable tax laws. Tenant shall be entitled to
withhold from any amount payable to landlord under this Lease such amount (and
only such amount) required to be withheld by Tenant pursuant to any applicable
Canadian Federal withholding tax provisions or any other Canadian Federal or
provincial tax laws and Tenant shall immediately remit any such amounts withheld
to the Canada Revenue Agency, or any successor thereto, on behalf of the
Landlord.
34. Permitted Leasehold Mortgage. Tenant shall not encumber its
leasehold estate in the Leased Premises, by means of a leasehold mortgage,
deed of trust, pledge or similar security device, except by means of a Permitted
Leasehold Mortgage. The Leased Premises shall not be encumbered by more than one
Permitted Leasehold Mortgage at any one time. Tenant shall deliver to Landlord
an executed counterpart of any Permitted Leasehold Mortgage within ten (10) days
after its execution thereof.
35. Rights of Permitted Leasehold Mortgagee. Landlord hereby agrees
that, so long as any Permitted Leasehold Mortgage shall remain unsatisfied of
record, the following provisions shall apply:
(a) Landlord, upon giving Tenant any notice of a default or
an Event of Default hereunder, shall also give such notice to any Permitted
Leasehold Mortgagee from whom it had received an address in writing.
(b) Upon the occurrence of an Event of Default hereunder, the
Permitted leasehold Mortgagee shall, within the period provided for in Paragraph
22 hereof, as extended as hereinafter provided, have tie right to remedy such
default, or cause the same to be remedied, and Landlord shall accept such
performance by or at the instance of the Permitted Leasehold Mortgagee as if the
same had been made by Tenant.
(c) Upon the occurrence of an Event of Default hereunder,
Landlord shall not terminate this Lease without first giving the Permitted
Leasehold Mortgagee ninety (90) days after notice thereof within which either
(i) to obtain possession of the Leased Premises (including possession by a
receiver) or (ii) to institute foreclosure proceedings or (iii) otherwise act to
acquire Tenant's interest under this Lease with diligence. The preceding
sentence shall not apply and Landlord may terminate this Lease if:
(1) An Event of Default shall have occurred that is then
Susceptible of being Cured by the Permitted Leasehold Mortgagee without
obtaining possession
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of the Leased Premises and the Permitted Leasehold Mortgagee (1) shall not have
cured any Event of Default consisting of a failure to pay Basic Rent or
Additional Rent within five (5) Business Days after notice from Landlord of such
Event of Default, or (2) shall not, within the applicable cure period specified
in Paragraph 22(b) after notice from Landlord of such Event of Default, have
cured any Event of Default (other than a failure to pay Basic Rent or Additional
Rent);
(2) an Event of Default (other than any Event of Default
described in subparagraph (A)(i) above) shall have occurred and either (1) the
Permitted Leasehold Mortgagee, within fifteen (15) days after the giving by
Landlord of notice of such Event of Default, shall not have given written notice
to Landlord that such Event of Default cannot be remedied without obtaining
possession of the Leased Premises; or (2) the Permitted Leasehold Mortgagee
shall not have paid or caused to be paid all Rent and other sums payable under
this Lease; or (3) the Permitted Leasehold Mortgagee shall. within fifteen (15)
days after notice from Landlord of such Event of Default, fail to give Landlord
a written notice that it shall, after obtaining possession, and within the
applicable cure period provided in Paragraph 22(b), xxxx any such Event of
Default which is susceptible of cure only upon taking possession; (D) the
Permitted Leasehold Mortgagee shall fail to pursue with diligence the activities
specified in (i), (ii) or (iii) of the first sentence of this Paragraph 35(c);
or (5) the Permitted Leasehold Mortgagee within thirty (30) days after the
giving by Landlord of notice of such Event of Default shall not have given
written notice to Landlord that such Event of Default is not reasonably
susceptible of being cured by the Permitted Leasehold Mortgagee.
(d) It is expressly understood, without limiting the
generality of the foregoing language, that any failure of Tenant to perform any
of its obligations under Xxxxxxxxx 00, Xxxxxxxxx 23(b)(iii) or Paragraph 29 is
susceptible of cure by the Permitted Leasehold Mortgagee without taking
possession, and Tenant hereby authorizes the Permitted Leasehold Mortgagee, on
behalf of Tenant, to send any notice, make any offer, pay any amount, select an
appraiser, and perform any other obligation of Tenant provided in said
Paragraphs.
(e) In addition to curing any Event of Default which is
susceptible of being cured without taking possession, the Permitted Leasehold
Mortgagee shall, during the period it is taking the action in clauses (i), (ii)
or (iii) of the first sentence of Paragraph 35(c) above, pay Basic Rent and
Additional Rent as the same shall become due and payable and, upon obtaining
possession or acquiring Tenant's interest under this Lease, shall be required to
commence to cure within thirty (30) days of such acquisition or possession all
Events of Default then outstanding and reasonably susceptible of being cured by
the Permitted Leasehold Mortgage, and thereafter diligently prosecute such cure
to completion; provided, that: (i) the Permitted Leasehold Mortgagee shall not
be obligated to continue such possession or to continue such foreclosure
proceedings after such Events of Default shall have been cured, and (ii) the
Permitted Leasehold Mortgagee shall agree with Landlord in writing to comply
during the period of such forbearance with such of the terms, conditions and
covenants of this Lease as are reasonably susceptible of being complied with by
the Permitted Leasehold Mortgagee.
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(f) It is understood and agreed, that the Permitted Leasehold
Mortgagee or its designees or any purchaser in foreclosure proceedings
(including a corporation formed by any Permitted Leasehold Mortgagee or the
holder or holders of the obligations secured by the Permitted Leasehold
Mortgage) may become the legal owner and holder of this Lease through such
foreclosure proceedings or by assignment of this Lease in lieu of foreclosure
provided, however that the Permitted Leasehold Mortgagee shall guarantee all of
the obligations and Liabilities of Tenant hereunder (except those which are
personal to Tenant, e.g., the obligations of Tenant under Paragraph 28) except
that the Permitted Leasehold Mortgagee shall be released from liability under
this Lease if the substitute tenant is approved by Landlord in its reasonable
discretion applying prudent business judgment or if the substitute tenant is a
Preapproved Assignee.
(g) If a termination of this Lease occurs prior to the
expiration of the Term by reason of the rejection of this Lease or other action
by a trustee, court or debtor in possession pursuant to the Bankruptcy &
Insolvency Act (Canada), as amended, or any other Federal, provincial or local
insolvency laws, Landlord shall give the Permitted Leasehold Mortgagee written
notice that this Lease has been terminated, together with a statement of any and
all sums which would at that time be due under this Lease but for such
termination, and of all other Events of Default, if any, under this Lease then
known to Landlord. The Permitted Leasehold Mortgagee shall thereupon have the
option to obtain a new lease in accordance with and upon the following terms and
conditions: (i) such new lease shall be effective as of the date of termination
of this Lease and shall be for the remainder of the full original term and at
the rent and upon all the agreements, terms, covenants and conditions hereof;
(ii) such new lease shall require the tenant to perform any unfulfilled
obligations of Tenant under this Lease which are reasonably susceptible of being
performed by such tenant; (iii) if the Permitted Leasehold Mortgagee designates
an entity to enter into such new lease, die Permitted Leasehold Mortgagee shall
guarantee all of the obligations and liabilities of such designee hereunder on
the same terms and conditions as those contained in the Guarantee (except those
which are personal to such designee, e.g., the obligations of such designee to
permit Landlord to inspect its books and records or to supply financial
statements to Landlord except that no such guarantee shall be required if such
designee is approved by Landlord in its sole discretion; (iv) upon the execution
of such new lease, the tenant named therein shall pay any and all Rent which
would at the time of the execution thereof be due under this Lease but for such
termination, less the net proceeds, if any, of any reletting or other occupancy,
after deducting from such proceeds all of Landlord's expenses in connection with
such reletting (including all repossession costs, brokerage commissions, legal
expenses, attorneys, fees, employees' expenses, costs of alterations and
expenses of preparation for reletting).
(h) Any notice or other communication which Landlord shall
desire or is required to give to or serve upon any Permitted Leasehold Mortgagee
shall be addressed to such Permitted Leasehold Mortgagee by notice in writing
given to Landlord in accordance with Paragraph 24 hereof. Any notice or other
communication which any Permitted Leasehold Mortgagee shall desire or is
required to give to or serve upon Landlord shall be deemed to have been duly
given or served if sent in accordance with Paragraph 24 hereof.
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(i) The provisions of this Paragraph 35 shall be
self-operative and shall benefit any Permitted Leasehold Mortgagee of which
Landlord has actual notice. Notwithstanding the foregoing, Landlord shall, at
the request of Tenant or the Permitted Leasehold Mortgagee, and at the sole cost
and expense of Tenant or the Permitted Leasehold Mortgagee, enter into an
agreement directly with the Permitted Leasehold Mortgagee having terms and
provisions identical to the provisions of this Paragraph 35.
(j) A Permitted Leasehold Mortgagee shall have the right but
not the duty to attempt to remedy a default or an Event of Default.
(k) The Tenant agrees to pay to the Landlord, in addition to
Basic Rent, and Additional Rent, any goods and services tax, business transfer
tax, value-added tax, multi-stage sales tax, sales, use or consumption tax, or
any like tax imposed by any governmental authority in respect of this Lease or
in respect of the Leased Premises and services provided hereunder, including
without limitation, such taxes calculated on or in respect of any Rent (whether
Basic Rent or Additional Rent) payable under this Lease; any such tax shall he
deemed not to be Rent, but the Landlord shall have the same remedies for and
rights of recovery of such amount as it has for recovery of Rent under this
Lease.
36. Grants and Releases of Easements. So long as no Event of Default
has occurred and is continuing Landlord hereby agrees to reasonably cooperate
with, the following actions by Tenant, in the name and stead of Landlord and
cause Lender to cooperate with, but at Tenant's sole cost and expense: (a) the
granting of easements, licenses, rights-of-way and other rights and privileges
in the nature of easements reasonably necessary or desirable for the
construction, operation, restoration, use, repair, renovation or maintenance of
the Leased Premises as herein provided; (b) the execution of petitions to have
the Leased Premises annexed to any municipal corporation or utility district;
(c) the execution of amendments to any covenants and restrictions affecting the
Leased Premises; (d) Tenant's obtaining all necessary government or third-party
actions, consents or agreements necessary for the performance and completion of
any Alteration provided, that in each case Tenant shall have delivered to
Landlord a certificate stating that: (i) such grant, release, dedication,
transfer, amendment or government action, or other action or agreement (any of
the foregoing, a "Property Action") does not impair the value, utility and
remaining useful life of the Leased Premises, (ii) such Property Action is
reasonably necessary in connection with the use, maintenance, alteration,
renovation, construction, operation, restoration, repair or improvement of the
Leased Premises, (iii) Tenant shall remain obligated under this Lease and under
any instrument executed by Tenant consenting to the assignment of Landlord's
interest in this Lease as security for indebtedness, in each such case, in
accordance with their terms, as though such Property Action had not been
effected and (iv) Tenant shall pay any Costs or Landlord under such Properly
Action. Without limiting the effectiveness of the foregoing, Landlord shall,
within thirty (30) days of receipt of the written request of Tenant, and at
Tenant's sole cost and expense (including reasonable fees and disbursements of
counsel to Landlord and Lender to review such Property Action), review and
either approve or disapprove in writing the proposed Property Action, and, if
approved, execute and deliver any instruments and take any other action
reasonably necessary or appropriate to
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confirm any such Property Action, to any person permitted under this Paragraph
36 or to implement any such Property Action.
37. Intentionally Omitted.
38. Post-Closing Obligations.
(a) Pursuant to those certain Property Condition Reports,
Environmental Audit Reports and Zoning Reports received by Landlord with respect
to the Leased Premises Tenant shall complete, remediate or obtain or caused to
be completed, remediated or obtained the Post-Closing Obligations within the
time periods specified in Exhibit "F".
(b) (i) On the date hereof, Tenant has deposited wide
Landlord a letter of credit (the "Environmental Letter of Credit" in the amount
of $1,622,250 (the "Environmental Escrow") which shall secure the obligation of
Tenant to complete the Post-Closing Obligation listed in Paragraphs B and C of
Exhibit "F" (the "Post-Closing Environmental Obligations").
(ii) The Environmental Letter of Credit shall be issued
by a bank acceptable to Landlord and having a long-term unsecured debt rating
of not less than "A" from S&P and in form and substance satisfactory to
Landlord The Environmental Letter of Credit shall be renewed at least thirty
(30) days prior to any expiration thereof. If Tenant fails to renew the
Environmental Letter of Credit by the date, time being of the essence, Landlord
shall have the right at any time after the thirtieth (30th) day before such
expiration date to draw on such Environmental Letter of Credit and to hold the
proceeds thereof as a cash Environmental Escrow.
(iii) The Environmental Letter of Credit shall remain in
full force and effect until Tenant is entitled to the return or reduction of the
applicable Environmental Escrow as provided for herein. The Environmental Letter
of Credit shall be returned to Tenant within thirty (30) days following the
earlier to occur of (A) written consent of Lender to release the Environmental
Letter of Credit or (B) (ix) remediation of the environmental contamination and
completion of those matters specified in Paragraph C of Exhibit "F" in
accordance with Paragraph C of Exhibit "F" and evidence of payment in full of
all remediation costs in connection with such remediation and (y) Tenant
provides Landlord evidence of completion of the items specified in Paragraph B
of Exhibit "F" as evidenced by written and photographic evidence reasonably
satisfactory to Landlord that the applicable Environmental Obligations have been
completed and evidence of payment in full of all remediation costs.
(iv) So long as no Event of Default has occurred and is
continuing, if the amount Landlord's Lender requires to be deposited in
connection with the initial Loan with respect to environmental matters is less
then the amount of the applicable Environmental Escrow set forth above, then,
Tenant shall have the right to substitute new Environmental Letters of Credit in
such reduced amounts and upon receipt by Landlord of such
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new Environmental Letters of Credit, Landlord shall promptly return the
applicable original Environmental Letter or Credit to Tenant.
(c) On the date hereof, Tenant has deposited with Landlord the
amount of $3,750 U.S. Dollars (the "Post-Closing Compliance Escrow") in the form
of cash which shall secure the obligation of Tenant to complete (the Post
Closing Obligations listed in Paragraph E of Exhibit "F" (the "Post-Closing
Compliance Obligations"), and shall be held and disbursed as set forth in this
Paragraph 39. The Post-Closing Compliance Escrow shall be released to Tenant
within thirty (30) days following the date on which Landlord receives written
and photographic evidence reasonably satisfactory to Landlord that all
Post-Closing Compliance Obligations have been completed (which shall include
written and photographic evidence and evidence of payment in full).
(d) If, at any time prior to the release of the Post-Closing
Environmental Escrow or the Post-Closing Compliance Escrow, an Event of Default
shall have occurred and be continuing, Landlord shall be entitled to draw upon
the Post-Closing Environmental Letter of Credit, any cash Post-Closing
Environmental Escrow or the Post-Closing Compliance Escrow (collectively, the
"Post-Closing Escrow") and shall use the proceeds of the Post-Closing Escrow to
the extent required to satisfy the Post-Closing Environmental Obligations or
Post-Closing Compliance Obligations, as applicable, and be entitled, at its sole
discretion, to apply any remaining balance in payment of any Rent or other
charges which have not been made pursuant to this Lease and any other sums due
to Landlord in connection with any default or the curing thereof, including,
without limitation, any damages incurred by Landlord by reason of such default.
Tenant acknowledges and agrees that such proceeds shall not constitute assets or
funds of Tenant or its estate, or be deemed to be held in trust for Tenant, but
shall be, for all purposes, the property of Landlord (or Lender, to the extent
assigned). Tenant further acknowledges and agrees that Landlord's application of
the proceeds of any Post-Closing Escrow towards the payment of Basic Rent,
Additional Rent or the reduction of any damages due Landlord in accordance with
Paragraph 23 of this Lease, constitute a fair and reasonable use of such
proceeds, and the application of such proceeds by Landlord towards the payment
of Basic Rent, Additional Rent or any other sums due under this Lease shall not
constitute a cure by Tenant of the applicable default, provided that an Event of
Default shall not exist if Tenant restores the applicable Post-Closing Escrow to
its full amount within three (3) days and in accordance with the requirements of
this Paragraph 39, so that the applicable amount of the Post-Closing Escrow
shall be again on deposit with Landlord.
(e) Landlord shall have the right to designate Lender or any
other holder of a Mortgage as the holder of the Post-Closing Escrow (including
assigning to Lender the Post-Closing Environmental Letter of Credit at Tenant's
sole cost or expense) during the term of the applicable Loan who shall have all
of the rights of Landlord under this Paragraph 39. Tenant covenants and agrees
to execute such agreements, consents and acknowledgements as may be requested by
Landlord from time to time to change the holder of each Post-Closing Escrow as
hereinabove provided.
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39. Miscellaneous.
(a) The paragraph headings in this Lease are used only for
convenience in finding the subject matters and are not part of this Lease or to
be used in determining the intent of the parties or otherwise interpreting this
Lease.
(b) As used in this Lease, the singular shall include the
plural and any gender shall include all genders as the context requires and the
following words and phrases shall have the following meanings: (i) "including"
shall mean "including without limitation"; (ii) "provisions" shall mean
"provisions, terms, agreements, covenants and/or conditions"; (iii) "lien" shall
mean "lien, charge, encumbrance, title retention agreement, pledge, security
interest, mortgage and/or deed of trust"; (iv) "obligation" shall mean
"obligation, duty, agreement, liability, covenant and/or condition"; (v) "any of
the Leased Premises" shall mean "the Leased Premises or any part thereof or
interest therein, including any one or more Related Promises"; (vi) "any of the
Land" shall mean "the Land or any part thereof or interest therein"; (vii) "any
of the Improvements" shall mean "the Improvements or any part thereof or
interest therein"; (viii) "any of the Equipment" shall mean "the Equipment or
any part thereof or interest therein"; and (ix) "any of the Adjoining Property"
shall mean "the Adjoining Property or any part thereof or interest therein".
(c) Any act which Landlord is permitted to perform under this
Lease may be performed at any time and from time to time by Landlord or any
person or entity designated by Landlord. Each appointment of Landlord as
attorney-in-fact for Tenant hereunder is irrevocable and coupled with an
interest. Landlord shall not unreasonably withhold or delay its consent,
approval or other determination, whenever such consent, approval or other
determination, is requited under this Lease. Time is of the essence with respect
to the performance by the parties of their obligations under this Lease.
(d) Landlord shall in no event be construed for any purpose to
be a partner, joint venturer or associate of Tenant or of any subtenant,
operator, concessionaire or licensee of Tenant with respect to any of the Leased
Premises or otherwise in the conduct of their respective businesses.
(e) This Lease and any documents which may be executed by
Tenant on or about the effective date hereof at Landlord's request constitute
the entire agreement between the parties and supersede all prior understandings
and agreements, whether written or oral, between the parties hereto relating to
the Leased Premises and the transactions provided for herein. Landlord and
Tenant are business entities having substantial experience with the subject
matter of this Lease and have each fully participated in the negotiation and
drafting of this Lease. Accordingly, this Lease shall be construed without
regard to the rule that ambiguities in a document are to be construed against
the drafter.
(f) This Lease may be modified, amended, discharged or waived
only by an agreement in writing signed by the party against whom enforcement of
any such modification, amendment, discharge or waiver is sought.
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(g) The covenants of this Lease shall run with the land and
bind Tenant, its successors and assigns and all present and subsequent
encumbrancers and subtenants of any of the Leased Premises, and shall inure to
the benefit of Landlord, its successors and assigns. If there is more than one
Tenant, the obligations of each shall be joint and several.
(h) If any one or more of the provisions contained in this
Lease shall for any reason be held to be invalid, illegal or unenforceable in
any respect, such invalidity, illegality or unenforceability shall not affect
any other provision of this Lease, but this Lease shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein.
(i) All exhibits attached hereto are incorporated herein as if
fully set forth.
(j) This Lease shall be governed by and construed and enforced
in accordance with the Laws of the Province.
(k) All dollar amounts set forth in this Lease are Canadian
Dollars except as expressly set forth to the contrary herein.
(l) Tenant represents, warrants and covenants with Landlord
that Tenant is not, nor will Tenant become, a Person with whom U.S. persons or
entities are restricted from doing business under regulations of the Office of
Foreign Asset Control ("OFAC") of the Department of the Treasury (including
those named on OFAC's Specially Designated and Blocked Persons list) or under
any statute, executive order (including the September 24, 2001, Executive Order
Blocking Property and Prohibiting Transactions with Xxxxxxx Who Commit, Threaten
to Commit, or Support Terrorism), or other governmental action and Tenant will
not engage in any dealings or transactions or be otherwise associated with such
persons or entities.
(m) This Lease may be executed in a number of counterparts and
by different parties hereto in separate counterparts each of which, when so
executed, shall be deemed to be an original and all of which taken together
shall constitute but one and the same agreement.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be
duly executed as of the day and year first above written.
LANDLORD:
PG-NOM (ALBERTA), INC., an Alberta
corporation, as nominee for PG-TRUST
(DE), a trust formed under the laws of the
State of Delaware
By: /s/ Xxxxx X. Xxxxxx
---------------------------
Title: Director
TENANT:
CWD WINDOWS AND DOORS, INC.,
a Canadian corporation
By: /s/ Xxxxx X. Xxx
---------------------------
Title: Vice President
SIGNATURE PAGE OF PLY GEM LEASE AGREEMENT, CANADA-1
EXHIBIT A
PREMISES
Those pieces of land situate in the Province of Alberta described as follows:
FIRSTLY: PLAN 316GV
BLOCK 1
LOT 1
EXCEPTING THE CORNER CUT ON PLAN 7710238
EXCEPTING THEREOUT ALL MINES AND MINERALS
SECONDLY: PARCEL 1
PLAN 316GV
BLOCK 6
LOT 3
EXCEPTING THEREOUT ALL MINES AND MINERALS
PARCEL 2
PLAN 316GV
BLOCK 6
LOTS 4 AND 5
EXCEPTING THEREOUT ALL MINES AND MINERALS
THIRDLY: PLAN 316GV
BLOCK 6
LOT 1
EXCEPTING THEREOUT ALL MINES AND MINERALS
FOURTHLY: PARCEL 1
PLAN 31GV
BLOCK 6
LOT 6
EXCEPTING THEREOUT ALL MINES AND MINERALS
PARCEL 2
PLAN 316GV
BLOCK 6
LOTS 7, 8 and 9
EXCEPTING THEREOUT ALL MINES AND MINERALS
PARCEL 3
PLAN 316GV
BLOCK 6
THE NORTH HALF OF LOT 10
EXCEPTING THEREOUT ALL MINES AND MINERALS
EXHIBIT A
EXHIBIT A
PARCEL 4
PLAN 316GV
BLOCK 6
THE SOUTH HALF OF LOT 10
EXCEPTING THEREOUT ALL MINES AND MENERALS
PARCEL 5
PLAN 316GV
BLOCK 6
LOT 11
EXCEPTING THEREOUT ALL MINES AND MENERALS
PARCEL 6
PLAN 3I6GV
BLOCK 6
LOT 12
EXCEPTING THEREOUT THAT PORTION OF LOT 12 FOR
CORNER
CUT ON PLAN 7710195
EXCEPTING THEREOUT ALL MINES AND MINERALS
FIFTHLY: PARCEL 1
PLAN 5998JK
BLOCK 19
LOT 15
EXCEPTING THEREOUT ALL MINES AND MINERALS
PARCEL 2
PLAN 5998JK
BLOCK 19
LOTS 16 AND 17
EXCEPTING THEREOUT ALL MINES AND MINERALS
PARCEL 3
PLAN 5882AB
BLOCK 19
THE SOUTH HALF OF LOT C
EXCEPTING THEREOUT ALL MINES AND MINERALS
EXHIBIT A
EXHIBIT B
MACHINERY AND EQUIPMENT
All fixtures, machinery, apparatus, equipment, fitting and appliances of every
kind and nature whatsoever now or hereafter affixed or attached to or installed
in any of the Leased Premises (except as hereafter provided), including all
electrical, anti-pollution, heating, lighting (including hanging fluorescent
lighting), incinerating, power, air cooling, air conditioning, humidification,
sprinkling, plumbing, lifting, cleaning, fire prevention, fine extinguishing and
ventilating Systems, devices and machinery and all engines, pipes, pumps, tanks
(including exchange tanks and fuel storage tanks), motors, conduits, ducts,
steam circulation coils, blowers, steam lines, compressors, oil burners,
boilers, doors, windows, loading platforms, lavatory facilities, stairwells,
fencing (including cyclone fencing), passenger and freight elevators, overhead
cranes and garage units, together with all additions thereto, substitutions
therefor and replacements thereof required or permitted by this Lease, but
excluding all Tenant's Equipment.
EXHIBIT B
EXHIBIT C
PERMITTED ENCUMBRANCES
1. Liens for taxes, assessments or governmental charges or levies
not at the time due and delinquent;
2. Undetermined or inchoate liens and charges incidental to current
operations which have not at such time been filed pursuant to law against the
Lessee or which relate to obligations not due or delinquent;
3. Any rights of expropriation, access or use or any other similar
right conferred or reserved by Or in any statute or Canada or Alberta;
4. Municipal by-laws and regulations affecting the use and occupancy
of the Leased Premises;
5. Encroachments revealed by the survey of the Leased Premises dated
January 26, 2004 prepared by Global Surveys Corp.; and
6. Instrument No. 981 367 918 registered against title to a portion
of the Leased Premises on November 24,1998, being & Caveat regarding a lease in
favour of Telus Mobility Inc.
EXHIBIT C
EXHIBIT D
BASIC RENT PAYMENTS
1. Basic Rent. (a) Initial Term. Subject to the adjustments provided
for in Paragraphs 2, 3 and 4 below, Basic Rent payable in respect of the Initial
Term shall be $692,329.07 per annum, payable quarterly in advance on each Basic
Rent Payment Date, in equal installments of $173,087.27. Pro rata Basic Rent for
the period from the date hereof through the last day of September 2004 shall be
paid on the date hereof.
(b) Renewal Term. Annual Basic Rent for the first year
of each Renewal Term shall be an amount equal to the Fair Market Rental Value as
of the first day of the applicable Renewal Term, as determined in accordance
with Paragraph 29 of this Lease, shall be payable in equal quarterly
installments and shall be subject to the adjustments provided for in Paragraphs
2, 3 and 4 below.
2. CPI Adjustments to Basic Rent. The Basic Rent shall be subject to
adjustment, in the manner hereinafter set forth, for increases in the index
known as Canadian Consumer Price Index for "all items excluding food and energy"
("CPI") or the successor index that most closely approximates the CPI. If the
CPI shall be discontinued with no successor or comparable successor index,
Landlord and Tenant shall attempt to agree upon a substitute index or formula,
but if they are unable to so agree, then the matter shall be determined by
arbitration in accordance with the rules of the Arbitration Act (Alberta). Any
decision or award resulting from such arbitration shall be final and binding
upon Landlord and Tenant and judgment thereon may be entered in any court of
competent jurisdiction. In no event will the Basic Rent as adjusted by the CPI
adjustment be less than the Basic Rent in effect for the one (1) year period
immediately preceding such adjustment.
3. Effective Dates of CPI Adjustments. Basic Rent shall not be adjusted to
reflect changes in the CPI until September 25, 2005 (the "First Basic Rent
Adjustment Date"). As of the First Basic Rent Adjustment Date and on each
anniversary of the First Basic Rent Adjustment Date thereafter during the
Initial Term and as of the first (1st) anniversary of the first full Basic Rent
payment date of each exercised Renewal Term (each, a "First Basic Rent Renewal
Adjustment Date") and on each anniversary of the First Basic Rent Renewal
Adjustment Date thereafter during such Renewal Term (each such date being
hereinafter referred to as a "Basic Rent Adjustment Date"), Basic Rent shall be
adjusted to reflect increases in the CPI over the CPI used to calculate the most
recent increase in Basic Rent (or, with respect to the first Basic Rent
Adjustment Date during the Initial Term or any Renewal Term, such increases
shall be measured against the CPI as of the first payment date during the
Initial Term or such Renewal Term, as the case may be).
4. Method of Adjustment for CPI Adjustment.
(a) As of each Basic Rent Adjustment Date when the
average CPI determined in clause (i) below exceeds the Beginning CPI (as defined
in this Paragraph 4(a)), the Basic Rent in effect immediately prior to the
applicable Basic Rent Adjustment Date shall be multiplied by a fraction, the
numerator of which shall be the difference between (i) the average CPI for the
three (3) most recent calendar months (the "Prior Months") ending prior to such
EXHIBIT D-1
EXHIBIT D
Basic Rent Adjustment Date for which the CPI has been published on or before the
forty-fifth (45th) day preceding such Basic Rent Adjustment Date and (ii) the
Beginning CPI, and the denominator of which shall be the Beginning CPI. The
product of such multiplication shall be added to the Basic Rent in effect
immediately prior to such Basic Rent Adjustment Date. As used herein, "Beginning
CPI" shall mean the average CPI for the three (3) calendar months corresponding
to the Prior Months, but occurring immediately prior to the effective date of
the most recent increase in Basic Rent (or, with respect to the first Basic Rent
Adjustment Date during the Initial Term or any Renewal Term, occurring
immediately prior to the first payment date during the Initial Term or such
Renewal Term as the case may be). If the average CPI determined in clause (i) is
the same or less than the Beginning CPI, the Basic Rent will remain the same for
the ensuing one (1) year period and the Beginning CPI for the adjustment (but
not any subsequent adjustment) occurring at the end of such ensuing one (1) year
period shall continue to be such Beginning CPI By way of example and for
purposes of clarification, if Basic Rent was $1 and CPI increased by 5%, 3%, and
2%, respectively, over three years. then annual rent for those three years
would be $1,$1, and $1.02 respectively. As a further example, if Basic Rent was
SI and CPI increased by 5%, 6%, and 2%, respectively. over three years, then
annual rent for those three years would be $1, $1.1007, and $1.02704,
respectively.
(b) Effective as of a given Basic Rent Adjustment Date, Basic
Rent payable under this Lease until the next succeeding Basic Rent Adjustment
Date shall be the Basic Rent in effect after the adjustment provided for as of
such Basic Rent Adjustment Date.
(c) Notice of the new annual basic Rent shall he delivered to
Tenant on or before the tenth (10th) day preceding each Basic Rent Adjustment
Date, but any failure to do so by Landlord shall not be or be deemed to be a
waiver by Landlord of Landlord's rights to collect such sums. Tenant shall pay
to Landlord, within ten (10) Business Days after a notice of the new annual
Basic Rent is delivered to Tenant, all amounts due from Tenant, but unpaid,
because the stated amount as set forth above was not delivered to Tenant at
least ten (10) Business Days preceding the Basic Rent Adjustment Date in
question.
EXHIBIT D-2
EXHIBIT E-1
RECORDING REQUESTED BY AND
AFTER RECORDING, RETURN TO:
GMAC Commercial Mortgage of Canada, Limited
00 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX
X0X 0X0
Attn: Servicing - Executive Vice President
SPACE ABOVE THIS LINE RESERVED FOR RECORDER'S USE
SUBORDINATION, NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
This Subordination, Non-Disturbance and Attornment Agreement
("Agreement"), is made between GMAC COMMERCIAL MORTGAGE OF CANADA, LIMITED, a
corporation formed under the Canada Business Corporations Act (" Lender" ),
___________________________________, a__________________________ ("Tenant") and
_________________________________, a_________________________("Landlord").
7. Background
EXHIBIT X-0 - 0
XXXXXXX X-0
A. Lender is about to make a loan to Landlord in the original principal
amount $___________________("Loan"), which will be secured by a first priority
charge or mortgage (as modified or extended from time to time, "Security
Instrument") on Landlord's property described more particularly on Exhibit A
attached hereto ("Property").
B. Tenant has leased a portion of the Property from Landlord pursuant to a
certain lease agreement between Landlord and Tenant dated______________
("Lease").
C. Tenant has been requested to subordinate its Lease to the Security
Instrument and has agreed to do so on the condition that it is assured of
continued occupancy of its leased space under the terms of the Lease and this
Agreement.
NOW, THEREFORE, in consideration of the mutual promises of this Agreement,
and intending to be legally bound hereby, the parties hereto agree as follows:
1. Subordination. Tenant agrees that the Lease, and all estates,
options and rights created under the Lease, hereby are subordinated
and made subject to the lien and effect of the Security Instrument,
as if the Security Instrument had been executed and recorded prior
to the Lease.
2. Nondisturbance. As long as no Tenant Event of Default exists under
the Lease no foreclosure, conveyance, or other sale of the Property
in connection with enforcement of the Security Instrument or
otherwise in satisfaction of the Loan shall operate to terminate the
Lease or Tenant's rights thereunder (except as set forth in Section
3). Provided that (i) Tenant is not in default, after the giving of
notice and the expiration of all applicable periods of grace or
cure, under the terms of the Lease and complies with this Agreement
or (ii) if Tenant is in default, after the giving of notice and the
expiration of all applicable periods of grace or cure, under the
terms of the Lease, (x) the period for a Permitted Leasehold
Mortgagee (as such term is defined in the Lease) to exercise its
cure rights with respect to such default has not expired in
accordance with the provisions of Section 35 of the Lease or (y) a
Permitted Leasehold Mortgagee has performed the obligations of
Tenant under the Lease and has remedied any such default in
accordance with the provisions of Section 35 of the Lease, Lender
agrees that in the event Lender acquires title to the Property by
reason of a foreclosure. Tenant's possession and occupancy of the
Property and Tenant's and Permitted Leasehold Mortgagee's rights and
privileges under the Lease during the term thereof (including any
renewal term) shall not be disturbed, diminished or interfered with,
and Lender shall recognize the Lease and Tenant's and Permitted
Leasehold Mortgagees rights hereunder. Subject to the limitations
and conditions contained herein, Lender upon foreclosure shall be
deemed to be Landlord and shall assume the obligations of Landlord
under the Lease thereafter arising. Lender
EXHIBIT X-0 - 0
XXXXXXX X-0
agrees to execute and deliver at any time and from time to time,
upon the reasonable request of Tenant or any Permitted Leasehold
Mortgagee, and at Tenant's or Permitted Leasehold Mortgagee's cost
and expense, any instrument or certificate in recordable form (and
otherwise in form reasonably satisfactory to Tenant or Leasehold
Mortgagee, as applicable) deemed to be necessary of appropriate to
evidence Tenant's rights to recognition and non-disturbance pursuant
to this Agreement, provided however, that such instruments or
certificates shall be on the same terms, covenants and conditions as
this Agreement.
3. Attornment. Tenant agrees to attorn to and recognize as its landlord
under the Lease each party acquiring legal title to the Property by
foreclosure, conveyance or other sale in connection with enforcement
of the Security Instrument of otherwise in satisfaction of the Loan
("Successor Owner"). As Successor Owner such party shall perform all
obligations of the landlord under the Leases arising from and after
the date title to the Property was transferred to Successor
Owner. In no event, however, will any Successor Owner be: (a) liable
for any default, act, or omission of any prior landlord under the
Lease; (b) subject to any offset or defense which Tenant may have
against any prior landlord under the Lease; (c) bound by any payment
of rent or additional rent made by Tenant to Landlord more than 30
days before the same is due; (d) bound by any modification or
supplement to the Lease, or waiver of Lease terms, made without
Lender's written consent thereto; (e) liable for the return of any
Security deposit or other prepaid charge paid by Tenant under the
Lease, except to the extent such amounts were delivered to Lender,
(f) liable or bound by any right of first refusal or option to
purchase all or any portion or the Property except for the option to
purchase as set out in Section 37 hereof, subject to the provisions
of this Agreement; (g) liable for construction or completion of any
improvements to the Property or as required under the Lease for
Tenant's use and occupancy (whenever arising): or (h) liable beyond
its interest in the Property for the payment of any claim or
indemnification arising under the Lease (whenever arising) including
any title and casualty insurance proceeds and condemnation awards
actually paid to Lender. Although the foregoing provisions of this
Agreement are self-operative, Tenant agrees to execute and deliver
to Lender or any Successor Owner such further instruments as Lender
or a Successor Owner may from time to time reasonably request in
order to confirm this Agreement.
4. Lender Opportunity to Cure Landlord Defaults. Tenant agrees that,
until the Security instrument is released by Lender, it will not
exercise any remedies under the Lease for Landlord defaults without
having first given to Lender (a) written notice of the alleged
Landlord default and (b) the opportunity to cure such default within
the longer of (i) 30 days after the cure period provided under the
Lease to Landlord, (ii) 30 days from Landlord's receipt of Tenant's
notice to Lender of a Landlord default, or (iii) if cure of such
default requires possession of the Property, 30 days after Lender
has obtained possession of the Property. Tenant acknowledges that
Lender is not obligated to cure any Landlord default, but if Lender
so elects to do so, Tenant agrees to accepts cure by Lender as that
of Landlord under the Lease and will not exercise any right or
remedy under the Lease for a Landlord default. Performance rendered
by Lender on Landlord's behalf is without prejudice to Lender's
rights against Landlord under the Security Instrument or
EXHIBIT X-0 - 0
XXXXXXX X-0
any other documents executed by Landlord in favor of Lender in
connection with the Loan.
5. Tenant to Pay Rents to Lender upon Notice. Tenant is hereby notified
that the Security Instrument and the other documents securing Loan
contain an assignment of the rents due to Landlord pursuant to the
Lease. In the event that Lender notifies Tenant that there has been
a default under the Loan and that Lender is entitled to receive the
rent due Landlord under the Lease, Tenant shall thereafter pay to
Lender or as directed by Lender all rentals and other monies due or
to become due to Landlord under the Lease and Landlord expressly
authorizes Tenant to make such payments to Lender and hereby
releases and discharges Tenant from any liability to Landlord on
account of such payments.
6. No Amendments. Tenant and Landlord each acknowledge agree that they
require Lender's consent to any future modification, waiver,
expansion or renewal (except for expansion or renewal rights
currently permitted to Tenant by the express terms of the Lease),
and no modification, waiver, expansion or renewal made without
Lender's written consent will be enforceable against Lender.
7. Termination. Tenant agrees that in the event that Tenant is entitled
to terminate the Lease pursuant to Section 18 of the Lease, any
Termination Notice given by Tenant to Landlord shall also be
delivered to Lender, contemporaneously with delivery to Landlord.
8. Permitted Leasehold Mortgagee. Tenant agrees with Landlord and
Lender that any Permitted Leasehold Mortgagee shall, prior to any
grant of security by Tenant to the Permitted Leasehold Mortgagee,
enter into a subordination and non-disturbance agreement
substantially in the form of this Agreement.
9. Miscellaneous.
(a) Notices. All notices under this Agreement will be effective
only if made in writing and addressed to the address for a
party provided below such party's signature. A new notice
address may he established from time to time by written notice
given in accordance with this Section. All notices will be
deemed received only upon actual receipt.
(b) Entire Agreement: Modification. This Agreement is the entire
agreement between the parties and supersedes all prior
discussions, representations and agreements (oral and
EXHIBIT X-0 - 0
XXXXXXX X-0
xxxxxxx) with respect to the subordination nondisturbance of the
Lease. This Agreement controls any conflict between the terms of
this Agreement and the Lease. This Agreement may not be modified,
supplemented or terminated, nor any provision hereof waived, unless
by written agreement of Lender and Tenant.
(c) Binding Effect. This Agreement binds and Inures to the benefit
of each party hereto and their respective heirs, executors,
legal representatives, successor and assigns, whether by
voluntary action of the parties or by operation of law. Upon
any safe of the Property by the Lender, the Lender shall
obtain the covenant of any purchaser to be bound by the terms
hereof and the Lender shall be relieved, of its obligations
hereunder.
(d) Unenforceability. No determination by any court government
body or otherwise that any provision of this Agreement is
invalid or unenforceable in any instance affects the validity
or enforceability of any other provision or such invalid or
unenforceable provision in any circumstance not controlled by
such determination. Each invalid or unenforceable provision
will be ineffective only to the extent of such invalidity or
unenforceability and otherwise construed to the greatest
extent possible to accomplish fairly the purposes and
intentions of the parties hereto.
(e) Governing Law. This Agreement shall be governed by the laws of
the province in which the Property is located and the laws of
Canada applicable therein.
(f) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and
all of which together constitute a fully executed agreement
even though all signatures do not appear on the same document.
IN WITNESS WHEREOF, this Agreement is executed this _______ day
of __________, 200__.
LENDER: TENANT:
GMAC Commercial Mortgage of Canada, Limited___________________________________
EXHIBIT X-0 - 0
XXXXXXX X-0
By:____________________________ By:______________________
Name: Name:
Title: Title:
LENDER NOTICE ADDRESS: TENANT NOTICE ADDRESS:
GMAC Commercial Mortgage of Canada, Limited _________________________
00 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX
X0X 0X0 _________________________
Attn: Servicing - Executive Vice President Attn:
LANDLORD:
By:____________________________
Name:
Title:
Landlord notice address:
Attach: Notary acknowledgments for each signer.
EXHIBIT X-0 - 0
XXXXXXX X-0
Exhibit A - Legal Description of the Property
EXHIBIT E-l - 7
EXHIBIT E-2
TENANT ESTOPPEL CERTIFICATE
Tenant Name: CWD WINDOWS AND DOORS, INC.
Landlord Name: PG-NOM (ALBERTA), INC.
Leased Space: _________________________
Landlord requests Tenant to complete this Certificate for the
benefit of GMAC Commercial Mortgage of Canada, Limited ("Lender") in connection
with a pending loan to be made by Lender that will be secured by a mortgage on
Landlord's property located at ______________ ("Mortgaged Property"). Tenant's
Leased Space is located within the Mortgaged Property. Tenant acknowledges that
its statements made in this Certificate will be relied upon by Lender and may be
enforced against Tenant with respect to Tenant's Lease.
8. TENANT STATEMENTS ABOUT ITS LEASE
1. An accurate and complete copy of Tenant's lease agreement ("Lease") is
attached as Schedule A. No other agreements (verbal or written) modify or
supplement the Lease or Tenant's rights with respect to the Leased Space.
2. Tenant currently is the sole tenant and occupier of the Leased Space.
Tenant has not entered into any agreement to assign, sublet, encumber, or
otherwise transfer all or any portion of the Leased Space or the Lease.
3. The Lease is [__] or is not [__] guaranteed. If guaranteed, the name and
current address of each guarantor is attached.
4. No default by Landlord (to Tenant's knowledge) or by Tenant currently
exists under the Lease. Tenant has no setoffs, credits, claims or defenses
to Tenant's obligation to pay rent or to enforcement of the Lease.
EXHIBIT E-2-1
EXHIBIT E-2
5. The current lease term began on _______________ [insert date], and the
rent commencement date, if different, began on _______________ [insert
date or "N/A" if not applicable]. The current lease term ends on
_______________ [insert date]. Tenant has no option to terminate the Lease
prior to such date, except in accordance with the rights of the Tenant
pursuant to subsection 18(a) of the Lease.
6. Tenant has the option to extend the term of the Lease for _______________
renewal periods [insert number of renewals or "none"]. Each renewal offers
a term of _______________ [insert term or "N/A" if not applicable]. Tenant
has not exercised any renewal option as of the date hereof.
7. Tenant has none of the following rights: Right to expand the Leased
Spaces; right to relocate the Leased Space; right of first refusal (offer)
with respect to any other space in the Mortgaged Property; or option or
right of first refusal (offer) to purchase the Mortgaged Property, except
for the Tenant's option to purchase set out in Section 37 of the Lease.
8. Tenant's last payment of base rent in the amount of $_______________
[insert amount] was paid on _______________ [insert date]. No other
advance rent has been paid by Tenant.
9. Tenant has paid Landlord a security deposit in the amount of $ NONE.
10. There are no rent-free periods or rent concessions provided under the
Lease and no rent concession will become effective during the remainder of
the Lease.
11. There are no tenant improvements to be constructed as a condition to the
Lease. No damage to the Leased Space exists which has not been repaired to
Tenant's satisfaction.
12. No bankruptcy, reorganization, insolvency or similar proceedings under
any provincial or federal law has been initiated by or against Tenant.
13. Tenant has all licenses and permits which Tenant must have to operate its
business from the Leased Space, and all are current and have not been
revoked.
EXHIBIT E-2-2
EXHIBIT E-2
14. Since taking possession of the Leased Space, Tenant has not received any
notice that the Leased Space or Tenant's use of the Leased Space violates
any applicable law, regulation ordinance or directive of any governmental
or agency or insurance company.
15. Since taking possession of the Leased Space, Tenant has not stored,
generated, manufactured, refined, treated, transported, disposed or in any
way used materials which are considered hazardous substances or wastes
under applicable environmental laws and regulations (including, without
limitation, petroleum or petroleum by-products) at the Leased Space or on
any other part of the Mortgaged Property, except as in compliance with the
Lease.
16. Tenant understands that a condition of the loan from Lender to Landlord
will require Lender's consent to any future modification, waiver,
expansion or renewal (except for expansion or renewal rights currently
permitted to Tenant by the express terms of the Lease), and no
modification, waiver, expansion or renewal made without Lender's written
consent will be enforceable against Lender.
17. Tenant understands that a condition of the loan from Lender to Landlord
will prohibit Landlord from accepting Tenant's rent more than 30 days
prior to its due date, and no payment of rent by Tenant more than 30 days
in advance will be binding on Lender.
18. Listed below are any exceptions asserted by Tenant to the foregoing
statements (Lender has no obligation to address Tenant's exceptions in
connection with the loan):____________________________________________
BY SIGNING BELOW, Tenant certifies that all information stated above is accurate
and correct and does not omit any material fact that would make any statement
false or misleading.
Date:____________________________ By:________________________
Name:
Title:
EXHIBIT E-2-3
EXHIBIT E-2
ATTACH: COMPLETE COPY OF LEASE AS SCHEDULE A.
NAMES AND ADDRESSES OF GUARANTORS, IF ANY.
EXHIBIT E-2-4
EXHIBIT E-2
Landlord signs below to certify to Lender that, to Landlord's knowledge, the
information disclosed by Tenant in the attached Tenant Estoppel Certificate is
accurate and complete and does not omit any material feel that would cause any
statement made by Tenant to be false or misleading.
Landlord:
Date:___________________________ By:______________________________
Name:
Title:
EXHIBIT E-2-5
EXHIBIT F
TENANT'S POST-CLOSING OBLIGATIONS
Tenant shall conduct the following actions and provide Landlord with
written confirmation, satisfactory to Landlord, within sixty (60) days of the
Commencement Date (or such other period of time expressly set forth below), that
all of the activities listed in Paragraphs A and B below have been
satisfactorily completed. Tenant shall provide written confirmation,
satisfactory to Landlord, within sixty(60) days of the completion of each
activity identified in Paragraph B below.
A. ENGINEERING ISSUES
1. Replace roof joist in warehouse area of building one.
2. Replace skylight on building two.
B. ENVIRONMENTAL REGULATORY COMPLIANCE ISSUES
1. Registration of used oil AST.
2. Prepare Spill Prevention and Response Plan.
3. Provide evidence that storage of motor oil, isopropyl alcohol and
used antifreeze currently stored outside have been moved to an
indoor storage area with secondary containment.
4. Provide evidence that the Surfcon material has been moved to a
heated storage area.
5. Provide evidence that the City of Calgary has been contacted and has
approved the discharge of wastewater from the reverse osmosis waste
treatment system to the city's POTW.
6. Disposal of investigation derived wastes from the investigation of
the former dip tank.
EXHIBIT F-1
EXHIBIT F
C. REMEDIATION/INVESTIGATION ISSUES
1. Remediate soil and groundwater contamination identified in the
August 2004 "Environmental Review of Plygem Industries, Inc. and MW
Manufacturers Inc" report prepared by ENVIRON to applicable CLEANUP
standards and to the written approval of the applicable
environmental agency.
EXHIBIT F-2
EXHIBIT F
D. NOTIFICATION
Tenant shall provide all communications regarding the Post-Closing
Obligations specified in Paragraphs B and C of this Exhibit "F
including Tenant's proof of satisfactory completion of these
obligations to Landlord addressed to:
Xxxxx X. Xxxxxx, Esquire
Xxxx Xxxxx LLP
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
E-mail: xxxxxxx@xxxxxxxxx.xxx
E. MISCELLANEOUS POST-CLOSING ISSUES
1. Make best efforts (with the co-operation of the Landlord as
required) to obtain encroachment agreements from The City of Calgary
in respect of those encroachments set out in the Real Property
Reports concerning the Leased Premises dated January 26, 2004 and
prepared by Global Surveys Corp.
2. Make best efforts to obtain the issuance of development completion
permits and/or occupancy permits, where same are required by Law
from The City of Calgary with respect to any buildings, structures
or improvements on or to the lands comprising the Leased Premises.
3. Make best efforts to obtain and register an amendment to the Caveat
registered as instrument number 981 367 918 against title to a
portion of the Leased Premises on the 24th day of November, 1998.,
to set out the correct location of the tower and component rooms as
shown on the Real Property Report dated January 26, 2004 and
prepared by Global Surveys Corp..
EXHIBIT F-3
EXHIBIT F
4. Obtain from Global Surveys Corp. reliance letters, separately
addressed to the following, parties in respect of the Real Property
Reports dated January 26, 2004 concerning the Leases Premises and
prepared by Global Surveys Corp.:
i) GMAC Commercial Mortgage of Canada, Limited, 00 Xxxx Xxxxxx,
Xxxxx 000, Xxxxxxx, XX, X0X 0X0;
ii) PG-NOM (Alberta) Inc., c/o WP Xxxxx & CO. LLC, 2nd Floor, 00
Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx, XXX, 00000; and
iii) PG-Trustee (Can) QRS 16-10, Inc., x/x XX Xxxxx & Xx. XXX, 0xx
Xxxxx, 00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx, XXX 00000; to
the effect that such parties may rely on the Real Property
Reports as if each of them was listed as a "client" thereon.
5. Tenant shall pay all amounts required to pay in full, and shall
obtain and register in the South Alberta Land Registry Office, a
valid discharge of the following encumbrance;
INSTRUMENT NO. ENCUMBRANCE ENCUMBRANCER
2840JQ Mortgage Xxxxxx'x Garden Chapel Ltd.
by October 29, 2004 and within five (5) days thereafter to provide
to FIRST CANADIAN TITLE INSURANCE COMPANY and BLAKE, XXXXXXX &
XXXXXXX LLP a copy of the registered discharge, together with a
release of interest in insurance policies duly executed by the
encumbrancer named above.
EXHIBIT F-4
