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EXHIBIT 10.3
SUBLEASE
This Sublease ("Sublease") is made as of September 30, 1996 by and between
Comerica Bank, a Michigan banking corporation ("Sublandlord"), with an address
at X.X. Xxx 00000, Xxxxxxx, Xxxxxxxx 00000-0000, Attention: Property
Management, and Michigan Commerce Bank, a bank in formation ("Subtenant"), with
an address at 00000 Xxxxxxxx Xxxx, Xxxx, Xxxxxxxx 00000.
RECITALS:
A. Sublandlord presently leases premises (the "Premises") legally known as
Xxxx Xx. 0, Xxxxxxx Xxxx Xxxxx, a condominium according to the Master Deed
thereof, recorded in Liber 9231, Pages 252-297, Oakland County Records and
commonly known as 00000 Xxxxxxxx Xxxx, Xxxx, Xxxxxxxx, including a branch
banking building consisting of approximately 3,005 square feet of area,
under a Ground Lease (the "Lease") dated May 13, 1987 between Land
Investment Partnership, whose successor in interest is Samelson Land
Holdings, L.L.C. ("Landlord"), and Manufacturers National Bank of Detroit,
whose successor in interest is Comerica Bank, as Tenant.
B. Sublandlord and Subtenant wish to enter into a sublease of the Premises
on the terms and conditions in this Sublease.
In consideration of the mutual undertakings in this Sublease, the parties
agree as follows:
1. Demise. Sublandlord subleases to Subtenant and Subtenant subleases
from Sublandlord the Subpremises for the term commencing on October 1,
1996 and ending on June 30, 2002, unless sooner terminated as provided in
this Sublease.
In the event that Subtenant shall not receive all regulatory approvals
necessary to operate as a State of Michigan chartered and federally
insured bank, Subtenant shall have the right, but not the obligation, to
terminate and otherwise satisfy all of its obligations under this
Sublease by delivering to Sublandlord both written notice of termination
("Termination Notice")and payment of Thirty-Five Thousand Dollars
($35,000.00) in immediately available funds ("Termination Payment") on or
before September 1, 1997. The termination shall be effective when both
the Termination Notice and the Termination Payment are delivered to
Sublandlord. In the event that the Termination Notice, but not the
Termination Payment, is timely delivered to Sublandlord, then at the
option of Sublandlord, it may elect to draw the Termination Payment under
the Letter of Credit (as described below). Notwithstanding such
termination, Subtenant shall remain liable for all rent payments and
other obligations which accrued prior to the effective time of
termination.
2. Subpremises. The "Subpremises" mean the Premises.
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3. Extension Option. If (and only if) Subtenant has first obtained from
Landlord, and delivered to Sublandlord, the Landlord's written release of
Sublandlord from all obligations and liabilities under the Lease and this
Sublease as to any extension or renewal of the Lease beyond June 30, 2002,
then Sublandlord shall and does (subject to receipt of said release)
hereby assign to Subtenant its right and option under Section 2 of the
Lease to renew the Lease on the terms and conditions set forth therein,
provided that any such renewal shall be deemed a direct contract between
Landlord and Subtenant, and Sublandlord shall have no further liability or
obligation to either Landlord or Subtenant under the Lease or this
Sublease. Except as specifically set forth in this Paragraph 3, Subtenant
has no option to extend or renew the Lease, and Subtenant has no option
under any circumstances to extend or renew this Sublease.
4. Basic Rent. Subtenant agrees to pay to Sublandlord at Sublandlord's
address listed above or such other place as Sublandlord may designate,
without notice, demand, deduction or set off, as rent for the Subpremises
the amount of Three Thousand Seven Hundred Fifty Dollars ($3,750.00) per
month, payable in advance on the first day of each calendar month, except
that the rent for the first full or partial calendar month of this
Sublease shall be paid upon signing of this Sublease. Rent for any
partial calendar month shall be prorated based on the number of days the
Sublease was in effect during that month. As long as Subtenant is not in
default under the Sublease, Subtenant shall be entitled to an abatement of
Subtenant's obligation to pay rent under this Paragraph 4 during the first
ten (10) months of the term of this Sublease. However, Subtenant shall
comply with all other obligations under the Sublease during said ten month
period.
5. Security. Subtenant shall deposit with Sublandlord on the signing of
this Sublease, as security for the performance by Subtenant of its
obligations under this Sublease and for the Termination Payment as
described above, an irrevocable, negotiable standby letter of credit,
issued by and drawn on a bank (and at a location) acceptable to
Sublandlord, for the benefit of Sublandlord, in the amount of Thirty-five
Thousand Dollars ($35,000.00) (the "Letter of Credit") in form and content
satisfactory to Sublandlord. The Letter of Credit shall have a term
extending at least thirty (30) days beyond the ending date of the term of
this Sublease or, in the alternative, the Letter of Credit shall have a
one (1) year term and be renewed by Subtenant each year (with the last
Letter of Credit to have a term extending at least thirty (30) days beyond
the ending date of the Sublease) with the renewal Letter of Credit to be
delivered to Sublandlord at least twenty (20) days before the expiration
of the then current Letter of Credit. If Subtenant fails to maintain the
Letter of Credit as required herein, Subtenant shall be in default and,
without limiting Sublandlord's other remedies, Sublandlord may draw upon
the entire amount of the Letter of Credit. In addition, if Subtenant
defaults in the performance of any of its other obligations, without
limiting its remedies Sublandlord may draw upon the Letter of Credit, and
apply or retain, the whole or part of the proceeds to the extent required
for payment of the obligation as to which Subtenant is in default or for
any sum
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which Sublandlord may expend by reason of Subtenant's default. If
Sublandlord applies or retains any part of the security deposit,
Subtenant upon demand will deposit with Sublandlord an additional Letter
of Credit in the amount so applied or retained. Sublandlord and
Subtenant acknowledge and agree that they shall annually, beginning after
the first 36 months of this Sublease term have expired, in good faith
review Sublandlord's requirement that Subtenant provide a Letter of
Credit in the amount of $35,000.00 for the benefit of Sublandlord.
6. Condition of Subpremises. Subtenant agrees to accept the Subpremises in
its "AS-IS" condition. Subtenant acknowledges that no representations
have been made with respect to the condition of the Subpremises.
Sublandlord has no obligation to perform any work or make any
installations in, or alterations to, the Subpremises in order to prepare
the Subpremises for Subtenant's occupancy.
7. Subtenant Alterations. Any alterations, additions, tenant work or
improvements (individually and collectively the "Alterations") by
Subtenant are at Subtenant's expense and must be done in accordance with
the Lease. Prior to commencing any Alterations, Subtenant shall submit to
Sublandlord and Landlord for their approval the proposed plans and
specifications. All Alterations must be performed in strict compliance
with the plans and specifications as may be approved by Sublandlord and
Landlord and with all applicable laws, ordinances, regulations, permits
and requirements of public authorities having jurisdiction over the
Alterations. Any review or inspection of the plans and specifications or
Alterations by Sublandlord or Landlord is for the sole purpose of
protecting their interests and is not for the benefit or protection of
Subtenant or any third party and does not create a warranty by Sublandlord
or Landlord as to the accuracy, sufficiency or any other aspect of the
review or inspection. Subtenant shall not suffer or permit any
construction liens to exist against the Subpremises and, in the event that
any such liens are filed against the Subpremises, Subtenant, at its
expense, shall cause them to be removed within thirty (30) days thereafter
by payment of the same or bonding over them. As a condition to Subtenant
making any Alteration, Sublandlord may require Subtenant, at Subtenant's
expense, to deliver to Sublandlord a payment and performance bond, in form
and content and issued by a company satisfactory to Sublandlord, covering
all the Alterations. Subtenant, unless otherwise requested by
Sublandlord, shall leave all Alterations and Tenant improvements in place
when this Sublease terminates. This shall not prohibit Subtenant from
removing its furniture, trade fixtures and readily moveable partitions,
provided that the any damage to the Subpremises or surrounding property
must be promptly repaired by Subtenant at its expense. Subtenant is =
entitled to any Tenant improvement or Alteration fee, payment or
allowance.
8. Utilities, Taxes and Assessments. Subtenant will pay when due all
charges for utilities furnished to the Subpremises and all real estate
taxes, impositions and assessments and all condominium assessments or
charges with respect to the
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Subpremises. Subtenant will promptly place all utility, real estate and
condominium bills in its name.
9. Assignment/Subletting. Subtenant shall not assign its rights or duties
under the Sublease or sublease any part of the Subpremises or permit the
Subpremises to be occupied by any other party without Landlord's and
Sublandlord's consent, which consent shall not be unreasonably withheld.
10. Lease. Subtenant has received and reviewed the Lease. Subtenant shall
not do or permit anything to be done in, or in connection with Subtenant's
use or occupancy of, the Subpremises which would violate any Lease
covenants or agreements. Subtenant agrees to be bound to Sublandlord and
Landlord by all obligations and restrictions which are set forth in the
Lease in the same manner as these obligations and restrictions are binding
upon Sublandlord, as Tenant under the Lease, except as expressly modified
by this Sublease. These obligations include, without limit, the
obligation to provide insurance, to pay all real estate taxes, impositions
and assessments with respect to the Subpremises, to perform all
maintenance, repairs and replacements, and to perform the obligations of
the owner under the Master Deed and condominium documents applicable to
the Subpremises, all as more fully set forth in the Lease. Except as may
be otherwise expressly provided in this Sublease, Sublandlord has the same
rights against Subtenant with respect to this Sublease as the Landlord has
against Sublandlord, as Tenant, with respect to the Premises under the
Lease. The Landlord under the Lease or the Sublandlord may enforce
against Subtenant any of the rights granted to Landlord under the Lease,
except as expressly modified in this Sublease. Subtenant agrees that
whenever the Lease requires the approval or consent of Landlord, this
shall mean the approval or consent of both Sublandlord and Landlord.
11. Services.
A. Notwithstanding anything contained in this Sublease, Subtenant
agrees and acknowledges that Sublandlord shall have no obligation or
responsibility whatsoever to provide or perform any service, utility,
repair, alteration or other similar obligation which is the obligation of
Landlord to provide or perform pursuant to the provisions and terms of
the Lease.
B. Subtenant recognizes that Sublandlord does not control the
operation of the Subpremises or the furnishing of utilities and services
therein. Accordingly, all of the agreements and obligations of
Sublandlord under this Sublease, express or implied, including without
limitation, any agreement or obligation to furnish utilities or services,
if any, are expressly dependent upon the performance and observation by
the Landlord of its agreements and obligations under the Lease. If the
Landlord shall default in the performance or observance of any of its
agreements or obligations under the Lease, either for the furnishing of
utilities or services or otherwise, Sublandlord shall not be liable
therefor to Subtenant. Any condition
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resulting from such default by the Landlord shall not constitute an
eviction, actual or constructive, and Subtenant shall not be entitled to
cancel this Sublease or to any reduction in or abatement of the rents
provided for herein, unless such reduction in or abatement of rent is
permitted by the terms of the Lease.
C. If Landlord shall default in any of its obligations to
Sublandlord with respect to the Subpremises, Sublandlord shall permit
Subtenant, at Subtenant's sole cost and expense, to enforce Sublandlord's
rights against Landlord with respect to the space, provided, however,
that Subtenant shall indemnify and hold Sublandlord harmless from and
against all liabilities, losses, demands, penalties, damages and expenses
(including without limit reasonable attorney fees) which Sublandlord may
incur or suffer by reason of or in connection with such action.
Sublandlord shall also execute any and all documents reasonably required
in furtherance of such action.
12. Right of Entry. Sublandlord and its authorized agents have the right to
enter the Subpremises at all reasonable times to examine the same.
13. Default. Sublandlord has the right, but not the obligation, to cure any
act or omission by Subtenant which would constitute a default under the
Lease or could after notice and the passage of time, constitute a default
under the Lease and to recover from Subtenant upon demand the costs
incurred by Sublandlord, including without limit attorneys' fees, in
curing the act or omission by Subtenant. All remedies provided by the
Lease which are hereby expressly incorporated by reference, shall be
available to Sublandlord against Subtenant if there is a default by
Subtenant under this Sublease. In addition to (and not in limitation of)
the remedies provided in the Lease, if there is a default by Subtenant,
then Sublandlord, at Sublandlord's option, may also exercise any one or
more of the following remedies:
(a) Terminate this Sublease and repossess the Subpremises, and be
entitled to recover from Subtenant as damages a sum of money equal
to the costs of recovering the Subpremises (including without limit
court costs and reasonable attorneys fees), plus the costs of
decorations, repairs and alterations to the Subpremises, plus the
costs of reletting the Subpremises (including without limit broker
commissions) plus the unpaid rent and other amounts due as of the
termination plus the present value (discounted at the then
prevailing prime rate as announced by Comerica Bank) of the balance
of the rent for the remainder of the Sublease term in excess of the
then fair market value of the remainder of the Sublease term.
(b) Terminate Subtenant's right of possession (but not the Sublease),
and repossess the Subpremises by forcible entry, summary proceedings
or otherwise. In such a case, Sublandlord may, but shall be under
no obligation to, relet the Subpremises or any part of them for such
rent and
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upon such other terms as shall be satisfactory to Sublandlord (and this shall
not constitute a termination of the Sublease). With respect to this reletting,
Sublandlord is authorized to decorate or make any repairs or alterations to the
Subpremises that Sublandlord determines may be necessary. In addition,
Sublandlord may recover from Subtenant from time to time the following costs to
the extent these costs exceed the amount, if any, received by Sublandlord upon
reletting:
(a) the rent due at the time of reletting,
(b) the cost of recovering the Subpremises and recovering other amounts
due Sublandlord (including without limit related court costs and
reasonable attorneys fees),
(c) the cost of decorations, repairs, and alterations,
(d) the cost of reletting (including without limit broker commissions),
(e) the rent due under the Sublease from the time of reletting until the
termination of the Sublease, and
(f) all other amounts due Sublandlord from Subtenant under the Sublease.
Sublandlord may file suit from time to time to recover the amounts owing
under this paragraph. Notwithstanding any such reletting without
termination of the Sublease, Sublandlord may at any time thereafter elect
to terminate this Sublease for such previous default, which termination
shall be evidenced by written notice thereof to Subtenant.
14. FDIC Termination Rights. Notwithstanding any other provisions contained
in this Sublease, in the event (a) Subtenant or its permitted successors
or assignees shall become insolvent or bankrupt, or if it or their
interests under this Sublease shall be levied upon or sold under execution
or other legal process, or (b) the depository institution then operating
on the Subpremises is closed, or is taken over by any depository
institution supervisory authority ("Authority"), Sublandlord may, in
either such event, terminate this Sublease only with the concurrence of
any Receiver or Liquidator appointed by such Authority as long as such
Receiver or Liquidator is not in default under this Sublease; provided
that in the event this Sublease is terminated by the Receiver or
Liquidator, the maximum claim of Sublandlord against the Receiver or
Liquidator for rent, damages, or indemnity for injury resulting from the
termination, rejection, or abandonment of the unexpired Sublease shall by
law in no event be in an amount greater than all accrued and unpaid rent
and liabilities to the date of termination.
15. Hazardous Waste. Subtenant, its agents, employees, invitees, licensees
and contractors shall not cause or permit any Hazardous Waste (as defined
below) to be used, stored, brought, transported, released, handled or
produced in, on or from the Subpremises or any other portion of the
building or the land of which it is a part. "Hazardous Waste" means any
flammable product, explosives, petroleum or
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petroleum-based product, radioactive material, hazardous or toxic
substances, asbestos or material containing asbestos, or any other
substance or material as defined in any local, state or federal
environmental, health or safety law, statute, ordinance, rule or
regulation, including without limit the Comprehensive Environmental
Response Compensation and Liability Act of 1980, as amended, and the
Resource Conservation and Recovery Act, as amended. In the event of a
breach of this provision, Sublandlord shall have the right, but not the
obligation, to remove, remediate or take such other action with respect to
the Hazardous Waste as Sublandlord deems necessary to comply with
applicable law, the requirements of public authorities or the terms of the
Lease. Subtenant shall defend, indemnify and hold harmless Sublandlord
from and against all claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses (including without limit court
costs and reasonable attorney fees) of whatever kind arising from or
relating to Subtenant's breach of this paragraph. The provisions of this
paragraph shall be in addition to, and not in limitation of, the
obligations and liabilities of Subtenant to Sublandlord under the Lease or
under common law or other agreement, and shall survive the termination of
the Sublease.
16. Notices. Subtenant agrees that whenever the Lease requires or permits
Tenant to give notice to Landlord within a certain time period, that time
period for purposes of Subtenant giving notice to Sublandlord under this
Sublease shall be deemed to be three less business days. Subtenant agrees
that whenever the Lease requires or permits Landlord to give notice to
Tenant within a certain time period, that time period for purposes of
Sublandlord giving notice to Subtenant under this Sublease shall be deemed
to be three more business days.
17. Definitions. Phrases or words not defined in this Sublease will have the
meaning given them in the Lease. Any reference to attorney fees means the
fees, costs, and expenses of both inside counsel and outside counsel and
paralegals, whether or not suit is instituted, and whether incurred at the
trial court level, on appeal, in a bankruptcy, administrative or probate
proceeding or otherwise.
18. JURY WAIVER. SUBLANDLORD AND SUBTENANT ACKNOWLEDGE THAT THE RIGHT TO A
JURY TRIAL IS A CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED. EACH
PARTY, AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH
COUNSEL OF THEIR CHOICE, KNOWINGLY AND VOLUNTARILY, AND FOR THEIR MUTUAL
BENEFIT WAIVE ANY RIGHT TO A TRIAL BY JURY IN THE EVENT OF LITIGATION
ARISING OUT OF OR RELATED TO THIS SUBLEASE.
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This Sublease has been signed and delivered as of the date first
written above.
COMERICA BANK MICHIGAN COMMERCE BANK
(a bank in formation)
By: /S/ XXXXXXX X. XXXXXX By: /S/ XXXXXXX XXXXXX
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Xxxxxxx X. Xxxxxx, not in
his individual capacity,
but solely as agent
Its: REAL ESTATE OFFICER Its: AGENT
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