EXHIBIT 99.4
LEASE
BETWEEN
BRADCO SUPPLY CORPORATION
as Landlord
AND
WICKES INC.
as Tenant
FOR PROPERTY LOCATED AT
000 X. Xxxxxxxx Xxxx
Xxxxx, XX 00000
DATED: December ___, 2003
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TABLE OF CONTENTS
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ARTICLE I. BASIC TERMS...........................................................................1
A. Address of Landlord............................................................................1
B. Address of Tenant..............................................................................1
C. Premises.......................................................................................1
D. Intentionally Deleted..........................................................................1
E. Intentionally Deleted..........................................................................1
F. Broker(s)......................................................................................1
G. Lease Term.....................................................................................1
H. Rent...........................................................................................1
ARTICLE II. GRANT AND TERM........................................................................2
A. Premises.......................................................................................2
B. Lease Term.....................................................................................2
ARTICLE III. RENT..................................................................................3
A. Base Rent......................................................................................3
B. Late Payment...................................................................................3
C. Payment of Rent................................................................................3
D. Billing........................................................................................3
ARTICLE IV. TAXES.................................................................................3
ARTICLE V. INTENTIONALLY DELETED.................................................................4
ARTICLE VI. USE...................................................................................4
ARTICLE VII. LAWS AND ORDINANCES...................................................................4
A. Tenant's Compliance with Laws and Ordinances...................................................4
B. Tenant's Right to Contest......................................................................5
C. Licenses and Permits...........................................................................5
ARTICLE VIII. UTILITIES AND SERVICES................................................................5
ARTICLE IX. QUIET ENJOYMENT.......................................................................5
ARTICLE X. ASSIGNMENT AND SUBLETTING.............................................................5
ARTICLE XI. DAMAGE OR DESTRUCTION.................................................................6
ARTICLE XII. SIGNS.................................................................................8
ARTICLE XIII. HOLDING OVER..........................................................................8
ARTICLE XIV. MORTGAGE , TRANSFER AND LIENS.........................................................8
ARTICLE XV. EMINENT DOMAIN........................................................................9
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ARTICLE XVI. MAINTENANCE AND REPAIR................................................................9
A. Repairs by Landlord............................................................................9
B. Repairs by Tenant..............................................................................9
C. Surrender of Premises.........................................................................10
ARTICLE XVII. ALTERATIONS AND ADDITIONS............................................................10
ARTICLE XVIII. INSURANCE............................................................................12
ARTICLE XIX. INDEMNIFICATION......................................................................14
ARTICLE XX. DEFAULT AND REMEDIES.................................................................14
A. Defaults......................................................................................15
B. Landlord Remedies.............................................................................15
C. Non-Waiver....................................................................................15
D. Cure Period...................................................................................15
E. Rights and Remedies Cumulative................................................................15
F. Tenant Remedies; Curing Landlord's Default....................................................16
G. Curing Tenant's Defaults......................................................................16
H. Self Help.....................................................................................16
ARTICLE XXI. ATTORNEYS FEES.......................................................................16
ARTICLE XXII. NOTICES..............................................................................16
ARTICLE XXIII. CERTIFICATES and subordination.......................................................17
A. Certificates..................................................................................17
B. Subordination.................................................................................17
ARTICLE XXIV. LANDLORD REPRESENTATIONS AND WARRANTIES..............................................18
ARTICLE XXV. INTENTIONALLY DELETED................................................................19
ARTICLE XXVI. MISCELLANEOUS........................................................................19
A. Binding Effect................................................................................19
B. Entire Agreement..............................................................................19
C. No Accord.....................................................................................19
D. Broker........................................................................................20
E. Memorandum of Lease and Option................................................................20
F. No Waiver.....................................................................................20
G. Applicable Law................................................................................20
H. Time..........................................................................................20
I. Severability..................................................................................20
J. No Waste......................................................................................20
K. Inspections...................................................................................20
ARTICLE XXVII. OPTION TO PURCHASE...................................................................21
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A. Purchase Option...............................................................................21
B. Purchase Option Price.........................................................................21
C. Closing.......................................................................................21
D. Title and Survey..............................................................................22
E. Prorations and Costs..........................................................................22
F. Landlord's Closing Documents..................................................................23
G. Tenant's Closing Documents....................................................................23
1
LEASE
-----
THIS LEASE is made as of the ___ day of December, 2003, by and between
Bradco Supply CoRPORATION, a New Jersey corporation ("Landlord"), and WICKES
INC., a Delaware corporation ("Tenant").
ARTICLE I. BASIC TERMS
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A. Address of Landlord.
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Bradco Supply Corporation
00 Xxxxxxxxxx Xxx
Xxxxxx, Xxx Xxxxxx 00000
Attention: Treasurer
B. Address of Tenant.
-----------------
Wickes Inc. 000 Xxxxx
Xxxxxxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attn: Real Estate Department
C. Premises. The parcel of land which is legally described in Exhibit "A"
--------
attached hereto, together with any buildings and other improvements located
thereon.
D. Intentionally Deleted.
E. Intentionally Deleted.
F. Broker(s). None.
G. Lease Term. The twenty (20) year period commencing on December ____,
----------
2003 and expiring on December _____, 2023, unless sooner terminated or unless
extended as set forth in this Lease.
H. Rent. All sums, moneys or payments required to be paid by Tenant to
----
Landlord pursuant to this Lease whether designated as "Base Rent," "Additional
Rent," or otherwise.
(a) Base Rent. $197,006 per annum ($16,417.17 per month) from the
commencement date until the 4th annual anniversary of the commencement
date;
(b) $204,887 per annum ($17,073.92 per month) from the day following
the 4th annual anniversary of the commencement date until the 8th annual
anniversary of the commencement date;
(c) $213,082 per annum ($17,756.83 per month) from the day following
the 8th annual anniversary of the commencement date until the 12th annual
anniversary of the commencement date;
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(d) $221,605 per annum ($18,467.08 per month) from the day following
the 12th annual anniversary of the commencement date until the 16th annual
anniversary of the commencement date; and
(e) $230,469 per annum ($19,205.75 per month) from the day following
the 16th annual anniversary of the commencement date until the expiraiton
of the Lease Term.
I. Security Deposit. Upon execution of this Lease, Tenant shall deposit the
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security deposit in an amount equal to the first month's Base Rent (the
"Security Deposit") with Landlord as security for the performance of Tenant's
obligations under this Lease. Upon the occurrence of a Default, Landlord may use
all or any part of the Security Deposit for the payment of any Rent or for the
payment of any amount which Landlord may pay or become obligated to pay by
reason of such Default, or to compensate Landlord for any loss or damage which
Landlord may suffer by reason of such Default. If any portion of the Security
Deposit is used, Tenant shall within five (5) days after written demand therefor
deposit cash with Landlord in an amount sufficient to restore the Security
Deposit to its original amount. Landlord shall not be required to keep the
Security Deposit separate from its general funds, and Tenant shall not be
entitled to interest on the Security Deposit. In no event shall the Security
Deposit be considered an advanced payment of Rent, and in no event shall Tenant
be entitled to use the Security Deposit for the payment of Rent. If no default
by Tenant exists hereunder, the Security Deposit or any balance thereof shall be
returned to Tenant promptly upon expiration or earlier termination of this Lease
in accordance with the provisions hereof.
ARTICLE II. GRANT AND TERM
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A. Premises. In consideration of the rents, covenants, agreements and
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conditions hereinafter provided to be paid, kept, performed and observed,
Landlord leases to Tenant the Premises described in Article I(C), subject to all
applicable zoning, municipal, county and state laws, ordinances and regulations
governing and regulating the use of the Premises and any covenants, conditions
and restrictions of record and Tenant accepts the Premises subject thereto and
to all matters disclosed thereby. It is specifically understood by the parties
hereto that this is a triple net lease, which means that in addition to the
Rent, the Tenant shall be responsible for all obligations and expenses relating
to the Premises.
B. Lease Term.
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(a) Tenant shall have and hold the Premises for and during the Lease
Term described in Article I(G), subject to the payment of Rent and to the
full and timely performance by Tenant of the covenants and conditions
hereinafter set forth. Tenant accepts the premises "as is" and in such
condition as the same are or may be as of the date hereof, and except as
herein specifically provided. Landlord shall not be obligated or required
to do any work or to make any alterations or install any fixtures,
equipment or improvements, or make any repairs or replacements to or on the
Premises in order to fit the same for Tenant's use.
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(b) Tenant shall have an option to terminate this Lease ("Termination
Option") which may be exercised by Tenant one time only effective at the
end of the last day preceding the 10th anniversary of the first day of the
Lease Term (the "Termination Option Date") provided that Tenant shall have
given written notice of such Termination Option to Landlordnot less than
180 days prior to the Termination Option Date. Obligations of a nature that
would survive the expiration of the Term of this Lease as provided herein
shall survive the Termination Option Date to the extent that such
obligations accrued prior to the Termination Option Date.
ARTICLE III. RENT
------------ ----
A. Base Rent. Tenant shall pay to Landlord the Base Rent specified in
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Article I(H) in lawful money of the United States in equal consecutive monthly
installments in advance on the first day of each and every month during the
Lease Term.
B. Late Payment. If Tenant shall fail to pay when the same is due and
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payable, any installment of Rent required to be paid by Tenant under this Lease,
including without limitation Additional Rent as defined in Section XX(G), such
unpaid amount shall bear interest ten days after the due date thereof to the
date of payment at the rate of ten percent (10%) per annum, but in no event at a
rate which is higher than the legal limit.
C. Payment of Rent. Rent shall be payable without demand, or notice. All
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Rent due under this Lease shall be paid by checks payable to the order of
Landlord, which checks shall be mailed or delivered to Landlord at the address
designated in Article I(A) above, or in such other manner or at such other place
as Landlord may from time to time designate to Tenant. Rent will be prorated for
partial months or partial years within the Lease Term (and for partial months or
partial years within periods for which same are payable).
D. Billing. Landlord's failure during the Lease Term to prepare and deliver
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any statements or bills or Landlord's failure to make a demand under any
provision of this Lease shall not in any way be deemed to be a waiver of or
cause Landlord to forfeit or surrender its rights to collect the Rent which may
have become due pursuant to this Lease during the term of this Lease. Tenant's
liability for the Rent due hereunder shall survive the expiration or sooner
termination of this Lease.
ARTICLE IV. TAXES
----------- -----
Tenant agrees to pay to Landlord as additional Rent all real estate taxes
levied or assessed against the Premises at any time during the Term, and any
renewal or extension thereof. For the purposes of this Lease, the term "real
estate taxes" shall include all real estate taxes and assessments, both general
and special and any other form of tax, assessment, license, fee, rent tax, levy
penalty (if as a result of Tenant's delinquency) impositions and charges of
every kind and nature whatsoever which may be assessed against the Premises,
extraordinary as well as ordinary, foreseen and unforeseen, and each and every
installment thereof which shall or may, during or pertaining to the Term, be
levied, assessed, imposed, become due and payable, or liens upon, or arising in
connection with, the use, occupancy or possession of, or due or payable out of
or for, the Premises or any part thereof, and all costs incurred by Landlord in
contesting or negotiating the same with governmental authorities.
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Nothing herein contained shall be construed to include any inheritance,
estate, succession, transfer, gift, franchise, corporation, income or profit tax
or capital levy that is or may be imposed upon Landlord; provided, however,
that, if at any time during the Term the methods of taxation prevailing at the
Commencement Date shall be altered so that in lieu of or as an addition to the
whole or any part of the taxes now levied, assessed or imposed on real estate as
such, there shall be levied, assessed or imposed (i) a tax on the rents received
from such real estate, or (ii) a license fee measured by the rents receivable by
Landlord from the Premises or any portion thereof, or (iii) a tax or license fee
imposed upon Landlord which is otherwise measured by or based in whole or in
part upon the Premises or any portion thereof, then the same shall be included
in the computation as if the amount of such tax or fee so payable were that due
if the Premises were the only property of Landlord subject thereto.
All references herein to real estate taxes for a particular calendar year
shall be deemed to refer to real estate taxes levied, assessed or otherwise
imposed for such calendar year without regard to when such real estate taxes are
payable. If and to the extent the assessed valuation of the Premises is
increased by reason of any special improvements which are made to the Premises
by or on behalf of Tenant, Tenant shall pay the full amount of all real estate
taxes thereafter payable during the Term which are attributable to such
increased assessment.
ARTICLE V. INTENTIONALLY DELETED
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ARTICLE VI. USE
----------- ---
The Premises are leased to Tenant for, and Tenant and its successors and
assigns shall be permitted to use the Premises for, the purpose of conducting or
carrying on the business of a truss manufacturing facility, retail and wholesale
lumber and building materials supply center, or for any other lawful purpose.
ARTICLE VII. LAWS AND ORDINANCES
------------ -------------------
A. Tenant's Compliance with Laws and Ordinances. Except for the performance
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by Landlord of certain environmental remediation as described in the Real Estate
Sale and Leaseback Agreement between Landlord and Tenant, Tenant, at its
expense, shall promptly comply at all times during the Lease Term with all laws
and ordinances and the orders, rules and regulations and requirements of all
federal, state and municipal governments and appropriate departments,
commissions, boards, and officers thereof, and the orders, rules and regulations
of the Board of Fire Underwriters where the Premises are situated, or any other
body now or hereafter constituted exercising similar functions, foreseen or
unforeseen, ordinary as well as extraordinary, and whether or not the same
require structural repairs or alterations, which may be applicable to the
Premises, or the use or manner of use of the Premises. Tenant will likewise
observe and comply with the requirements of all policies of public liability,
fire and all other policies of insurance at any time in force with respect to
the Premises and the improvements and equipment comprising same. If as a result
of Tenant's use of the Premises the Premises are required to be brought into
compliance with the requirements of the Americans with Disabilities Act, or any
similar local laws or regulations, (hereinafter collectively referred to as the
"ADA"), the cost and obligation for same shall be the sole obligation of Tenant
to perform. In that regard, Tenant hereby indemnifies and holds Landlord
harmless from any and all costs, expenses, and fines that may arise requiring
compliance with the ADA as a result of Tenant's use of the Premises or its
activities at the Premises.
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B. Tenant's Right to Contest. Tenant shall have the right to contest by
--------------------------
appropriate legal proceedings, without cost or expense to Landlord, the validity
of any law, ordinance, order, rule, regulation or requirement of the nature
herein referred to, and if, by the terms of any such law, ordinance, order,
rule, regulation or requirement, compliance therewith may legally be held in
abeyance without subjecting Tenant or Landlord to any liability for failure so
to comply therewith, Tenant may postpone compliance therewith until the final
determination of any such proceedings, provided that all such proceedings shall
be prosecuted with all due diligence and dispatch.
C. Licenses and Permits. Tenant shall obtain and maintain at all times
----------------------
during the Lease Term, all licenses and permits required to conduct or operate
its business in and upon the Premises which are required by any applicable
governmental body or agency having jurisdiction over the Premises and shall pay
the fee or charge imposed for issuance of such license or permit. Tenant shall
renew any such licenses and permits in accordance with the rules, codes,
statutes or ordinances requiring such licenses or permits. Tenant, at its
expense, shall comply with all requirements and perform all necessary action
required under such rules, codes, statutes or ordinances for the issuance and
continuance of such permits or licenses.
ARTICLE VIII. UTILITIES AND SERVICES
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Except as otherwise provided herein, Tenant shall contract in its own name
and timely pay for all charges for electricity, gas, fuel, telephone, trash
hauling, snow removal, and any other services or utilities used in, servicing or
assessed against the Premises, unless otherwise herein expressly provided.
Landlord shall have no liability to Tenant nor shall Rent xxxxx in the event of
any interruption or discontinuance of any of the aforesaid utilities or services
to the Premises. Tenant shall at all times during the Term provide and maintain
in good condition, repair and use, the water well and septic sewer system
existing on the Premises on the commencement date of this Lease.
ARTICLE IX. QUIET ENJOYMENT
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Landlord covenants that Tenant, on paying the Rent herein provided and
keeping, performing and observing the covenants, agreements and conditions
herein required of Tenant, shall peaceably and quietly hold and enjoy the
Premises for the Lease Term without hindrance by anyone claiming by or through
Landlord, subject, however, to the terms and conditions of this Lease.
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ARTICLE X. ASSIGNMENT AND SUBLETTING
---------- -------------------------
Tenant shall not, without Landlord's prior written consent, (a) assign,
sublease, or convey this Lease or any interest under it; (b) allow any transfer
thereof of Tenant's interest by operation of law or otherwise; (c) sublet the
Premises or any part thereof; or (d) permit the use or occupancy of the Premises
or any part thereof by anyone other than Tenant. Landlord agrees that it will
not unreasonably withhold its consent to any assignment or sublease, provided
that if Tenant requests Landlord's consent to a sublease or to an assignment of
all or a substantial portion of the entire Premises, Landlord may, in lieu of
granting such consent or reasonably withholding the same, terminate this Lease,
effective on the commencement date specified in the sublease or on the effective
date of said assignment, as the case may be, to which Landlord's consent was
requested. No permitted assignment or subletting shall relieve Tenant of
Tenant's covenants and agreements hereunder and Tenant shall continue to be
liable as a principal and not as guarantor or surety, to the same extent as
though no assignment or subletting had been made.
ARTICLE XI. DAMAGE OR DESTRUCTION
----------- ---------------------
A. (a) If the Premises is damaged by any cause required to be covered by
insurance pursuant to Article 18, Tenant, at its sole expense, shall forthwith
repair, restore, and rebuild the same with all reasonable dispatch and
diligence, so far as practicable and lawful, to a complete unit of like quality,
character, and condition and the same layout and parking to rentable square foot
ratio as that which existed immediately prior to the damage. Tenant shall be
entitled to the use of insurance proceeds available from insurance covering such
damage to the extent of the actual cost of such repair. Said repair, restoration
and rebuilding shall be constructed in accordance with plans and specifications
approved in writing by Landlord, prepared by a licensed architect selected and
employed by Tenant and approved in writing by Landlord, and performed by a
licensed general contractor approved in writing by Landlord. None of the
approvals to be obtained from Landlord in the previous sentence shall be
unreasonably withheld. During such repair, restoration or rebuilding Landlord
shall at all times have access to the Premises for the purpose of making
inspections of the work in progress.
(b) If Tenant does not either:
(i) Obtain a building permit for any repairs, rebuilding or
restoration required hereunder within three (3) months from the date
of such damage or destruction, or
(ii) Complete such repairs, rebuilding or restoration and comply
with the conditions in Article XI(B) below for the resumption of rent
and other payments by Tenant within six (6) months after the date of
such damage or destruction,
then in either event Landlord may at any time thereafter cancel and terminate
this Lease by sending ninety (90) days written notice thereof to Tenant, except
however said notice of cancellation shall not be effective if Tenant within said
ninety (90) day period shall obtain such permit or complete and comply as
aforesaid, as the case may be.
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B. (a) In the event that the Premises is damaged to the extent that it is
not reasonably suitable for the normal conduct of Tenant's business materially
as carried on prior to said damage, and despite such damage, Tenant elects to
continue occupancy of the Premises, then from the date of such damage until
completion of repair, restoration, and rebuilding, there shall be an equitable
adjustment in Rent, and any imposition and charges, including but not limited to
real estate taxes, insurance and maintenance expenses, taking into account the
interference with Tenant's normal conduct of business and loss of profit
resulting therefrom. If Tenant elects to discontinue occupancy because the the
Premises are not reasonably suitable for the normal conduct of Tenant's business
materially as carried on prior to said damage, then the Rent and any impositions
and charges, including but not limited to real estate taxes, insurance and
maintenance expenses, shall completely xxxxx during the period of repair.
Notwithstanding anything herein to the contrary, Tenant shall only be entitled
to an abatement of the Rent to the extent that Landlord receives payment of the
proceeds of any rent insurance in lieu of Rent.
(b) Tenant shall not be required to accept delivery of possession of
the Premises and to commence payment of Rent and other charges payable by
Tenant to Landlord hereunder until the earlier of (i) the date on which
Tenant recommences to conduct business on the entire Premises, or (ii)
sixty (60) days after the date on which the last of all the following
events have occurred:
(i) The architect in charge of the construction on the Premises
certifies in writing to Tenant that said construction has been
completed in strict accordance with the approved plans and
specifications;
(ii) A certificate of occupancy or an equivalent use permit, and
all other requisite permits necessary for Tenant to conduct business
on the Premises and for the public to have access to the Premises are
issued by the appropriate legal authorities issuing same (Landlord
shall deliver to Tenant certified or photostatic copies of same); and
(iii) If the location of the foundations or exterior walls has
been changed, Landlord delivers to Tenant an as-built survey of the
restored Premises.
C. If more than one-third (1/3) of the improvements upon the Premises are
destroyed and such destruction occurs within the last one (1) year of the
initial Lease Term to such an extent that Tenant shall be unable to conduct
business on the Premises, Tenant at its option may terminate this Lease
effective as of the date of such casualty by giving to the Landlord within
thirty (30) days after the occurrence of such casualty, written notice of such
termination. If said notice be given within said thirty (30) day period by
Tenant, this Lease shall terminate and Tenant shall assign to Landlord all of
Tenant's claim or interest in and to insurance proceeds otherwise allowable for
the repair and restoration of said improvements.
D. (a) If Tenant fails or is unable to obtain a building permit for
repairs, rebuilding or restoration of the Premises within three (3) months from
the date damage occurs, Landlord shall have the right to apply for that permit
and Tenant shall cooperate with Landlord in its application.
(b) If Tenant stops the restoration of the Premises or if Landlord
obtains a building permit pursuant to Article XI(D)(a) above, Landlord may
take over the restoration of the Premises. If Landlord elects to take over
the restoration of the Premises, Tenant shall:
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(i) Turn over all insurance proceeds in its possession to
Landlord and assign to Landlord its right to all uncollected insurance
proceeds and all insurance proceeds held by or for the benefit of the
holder of the beneficiary's interest under a deed of trust encumbering
the Premises; and
(ii) (Assign to Landlord its rights under contracts with the
architect and general contractor with respect to the work done and to
be done on the Premises.
ARTICLE XII. SIGNS
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Subject to Tenant's compliance with all applicable laws and regulations
applicable to the posting or erecting of signs, Tenant shall have the right to
erect temporary and permanent signs advertising Tenant's business, which sign or
signs may be erected on the Premises. Landlord will assist Tenant, at Tenant's
expense, in securing any permits and approvals from governmental authorities
necessary for Tenant's signs. Any signs of Tenant shall remain the property of
Tenant, and Landlord agrees that Tenant shall have the right, provided Tenant is
not in default under the terms of this Lease, at any time, and from time to
time, to remove any and all signs which it may have stored or installed in the
Premises. Tenant, at its sole cost and expense, shall repair within a reasonable
time any damage occasioned to the Premises by reason of the removal of any such
signs.
ARTICLE XIII. HOLDING OVER
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If Tenant, or any person claiming through Tenant, shall continue to occupy
the Premises after the expiration or earlier termination of the Lease Term
without the consent in writing of Landlord, such occupancy shall be deemed to be
under a month-to-month tenancy under the same terms and conditions set forth in
this Lease; except, however, that the Base Rent for each month during such
continued occupancy shall be 125% of the amount in effect as of the expiration
or earlier termination of the Lease Term. Anything to the contrary
notwithstanding, any holding over by Tenant without Landlord's prior written
consent shall constitute a default hereunder and shall be subject to all the
remedies set forth in Article XX hereof.
ARTICLE XIV. MORTGAGE , TRANSFER AND LIENS
------------ -----------------------------
A. Landlord shall have the right to transfer, mortgage, pledge or otherwise
encumber, assign and convey, in whole or in part, the Premises, its interest in
this Lease, and all or any part of the rights now or hereafter existing and all
Rent payable to Landlord under the provisions hereof. Tenant shall not have the
right to mortgage, pledge, or otherwise encumber its leasehold interest under
this Lease.
9
B. Tenant shall not suffer or permit any vendor's, mechanic's, laborer's,
or materialman's statutory or similar lien to be filed against the Premises or
any interest of Landlord or Tenant therein by reason of labor, services or
materials supplied or claimed to have been supplied to Tenant or anyone holding
the Premises, or any part thereof, through or under Tenant (including labor,
services or materials supplied in connection with the construction or
restoration referred to in Articles XVII). If any such lien shall at any time be
filed against the Premises, Tenant shall, within 20 days after notice of the
filing thereof, cause the same to be released and discharged. Notwithstanding
the foregoing, Tenant shall not be in default hereunder provided Tenant delivers
to Landlord a bond or bonds in an amount equal to the claim of any such lien and
proceeds diligently and in good faith to contest said lien.
ARTICLE XV. EMINENT DOMAIN
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If the Premises or such substantial part (in excess of 50% of the square
footage of the Premises) thereof as reasonably renders the remainder unfit for
the intended uses shall be taken by any competent authority under the power of
eminent domain or be acquired for any public or quasi-public use or purpose, the
Lease Term shall cease and terminate upon the date when the possession of the
Premises or the part thereof so taken shall be required for such use or purpose
and without apportionment of the award. If any condemnation proceeding shall be
instituted in which it is sought to take any part of the Premises or to change
the grade of any street or alley adjacent to the Premises or to take any portion
of the Premises used by Tenant for parking, storage or access to the Premises
and such taking or change of grade makes it necessary or desirable to remodel
the Premises (or any one of them) so as to avoid any material change in the
conduct of Tenant's operations at the Premises or to take any portion of the
Premises used by Tenant for parking, storage or access to Premises to conform to
the changed grade, or makes the use of the Premises less desirable for its
intended purposes in any material way, each party shall have the right to
terminate this Lease after having given written notice of termination to the
other party not less than ninety (90) days prior to the date of termination
designated in the notice. In either of said events, Rent at the then current
rate shall be apportioned as of the date of the termination. Tenant may pursue a
separate award for its leasehold estate and for or depreciation to and cost of
removal of Tenant's equipment and fixtures, and Tenant's relocation expenses.
ARTICLE XVI. MAINTENANCE AND REPAIR
------------ ----------------------
A. Repairs by Landlord. Landlord shall have no maintenance, repair, or
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replacement obligations hereunder.
B. Repairs by Tenant. All repairs and replacements to the Premises and
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parking areas, including, without limitation, repairs and replacements to the
doors, door frames, windows, window frames, plate glass, storefront, fixtures,
and all electrical, plumbing and sewage pipes, lines, ducts, wires, conduits and
components located within or exclusively serving the Premises, foundations,
roof, exterior walls, load and non-load bearing interior walls, all paved areas,
heating and air conditioning equipment, and sprinklers, shall be performed by
Tenant, at its expense. All such repairs and replacements shall be of first
class quality sufficient for the proper maintenance and operation of the
Premises. If Tenant refuses or neglects to repair or replace any portion of the
Premises as required by this Lease and to the reasonable satisfaction of
Landlord, Landlord, upon written notice to Tenant may, but shall not be
obligated to, make such repairs or replacements and upon completion thereof,
Tenant shall promptly pay Landlord's costs thereof.
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C. Surrender of Premises. Tenant shall, upon termination of this Lease,
---------------------
surrender to Landlord the Premises in the same condition, order and repair as
the Premises are in on the date of this Lease, ordinary wear and tear excepted,
but subject to Tenant's repair and maintenance obligations under this Article.
ARTICLE XVII. ALTERATIONS AND ADDITIONS
------------- -------------------------
A. Tenant shall have the right to make any alterations, improvements, or
additions to the Premises without the prior written consent of Landlord,
provided that the estimated cost of such alteration, improvement or addition
does not exceed $100,000 per annum. In the event that such cost exceeds $100,000
per annum, Tenant shall obtain Landlord's prior written consent, which consent
shall not be unreasonably withheld, before performing any such work. Permanent
alterations, improvements or additions so made by either of the parties upon the
Premises, except movable furniture and equipment placed in the Premises at the
expense of Tenant, shall be and become the property of Landlord and shall remain
upon and be surrendered with the Premises as a part thereof at the termination
of this Lease, without disturbance, injury or damage; provided, however, that if
Landlord advised Tenant in writing at the time of Landlord's approval of any
alteration (or, if Landlord's approval is not required, prior to commencement of
such alteration) that Tenant would be required to remove such alteration, then
Landlord shall have the right to require Tenant to remove such alteration, at
Tenant's sole cost and expense, upon the termination of the Lease and Tenant's
surrender of the Premises, and repair any damages resulting from such removal.
B. All changes and alterations when completed shall be of such a character
as not to reduce, or otherwise adversely affect, the value of the Premises nor
to reduce the cubic content of the improvements, nor change the character of the
improvements as to use. All work done in connection with any change or
alteration shall be done promptly and in a good and workmanlike manner and in
compliance with the building and zoning laws of the place in which the Premises
are located and with all laws, ordinances, orders, rules, regulations and
requirements of all federal, state and municipal governments and the appropriate
departments, commissions, boards and officers thereof, and in accordance with
the orders, rules and regulations of the Board of Fire Underwriters where the
Premises are situated or any other body exercising similar functions; the cost
of any such change or alteration shall be paid in cash and in such manner that
the Premises shall at all times be free of liens for labor and materials
supplied or claimed to have been supplied to the Premises. All parties
performing work on the Premises must meet the following insurance requirements.
The Tenant shall obtain and shall require its contractors or vendors of any
tier, to pay for and keep in force, insurance for protection from claims under
workers' compensation acts; claims for damages because of bodily injury,
including personal injury, sickness, disease or death of any of the contractors'
employees or of any other person; claims for damages because of injury to or
destruction of property including loss of use resulting therefrom, claims for
damages because of bodily injury or death of any persons or property damage
arising out of ownership, maintenance or use of any motor vehicle, aircraft, or
watercraft, and claims arising out of the performance of the contract and caused
by the contractor's negligence. Compliance by the contractor with the insurance
requirements set forth herein shall not relieve the contractor from liability
for amounts in excess of the limits of insurance.
11
Prior to commencement of the work, the contractor shall deliver to Landlord
insurance certificates evidencing that the required insurance is in force with
insurance companies satisfactory to Landlord. The contractor shall deliver to
Landlord, upon request, copies of the actual insurance policies. All
certificates of insurance required hereunder shall specifically state the
insurer's promise that there shall be no material change in, or cancellation of
the policy or policies evidenced except upon 30 days prior written notice via
certified mail to Landlord, and that 30 days prior to the renewal date, the
contractor shall furnish Landlord with updated or replacement certificates of
insurance that clearly evidence continuation of all coverages in the same
manner, limits and protection, as required. Landlord shall be included as
additional insureds under all coverages (except Professional Liability &
Statutory Workers Compensation) as required by this contract and such additional
insureds shall include coverage for completed operations and shall be
specifically identified on the certificates of insurance.
Such insurance as required shall be kept in force by the contractor
continuously during the life of the contract, and for a period of not less than
90 days from the date of final completion. Additionally, the completed
operations Insurance required hereunder shall be kept in force by the contractor
for a period of not less than one year after the date of final completion.
The types of insurance, and MINIMUM amounts of limits, required hereunder
are:
(a) 1. Workers' Compensation Insurance coverage; statutory
requirements in the State where the property is located and any other
applicable state.
(b) Employers Liability Insurance (Stop Gap for Monopolistic States)
with limits of not less than $500,000 per accident per person, $500,000 per
disease per person, $500,000 aggregate
(c) Commercial General Liability Insurance, written on an occurrence
form:
$500,000 Each Occurrence (BI & PD Combined Single Limit)
$1,000,000 General Aggregate
$1,000,000 Personal and Advertising Injury Liability to
include coverage for employee related claims
$1,000,000 Products and Completed Operations Aggregate
$1,000,000 Fire Damage Legal Liability (Any One Fire)
$5,000 Medical Payments (Any One Person)
12
(d) Excess/Umbrella Liability Insurance, written on an occurrence
form:
$500,000 Each Occurrence
$500,000 Aggregate
The Excess/Umbrella Liability coverage must be as broad or
broader than the Primary Insurance policies.
(e) Comprehensive Automobile Liability Insurance covering all owned,
non-owned and hired automobiles used in connection with the work, with
combined single limit coverage for Bodily Injury and Property Damage of not
less than $1,000,000 per accident.
(f) In lieu of the total limits of liability being provided under the
primary liability insurance, the contractor may provide the liability limit
specified by means of a combination of Primary and Excess/Umbrella
Liability insurance. The Excess/Umbrella Liability coverage must be as
broad or broader than the Primary Insurance policies. All policies and
certificates required of the contractor shall be endorsed to include
Landlord as an additional insured (except Professional Liability and
Statutory Workers Compensation), and provide primary coverage without right
of contribution by any insurance carried by Landlord. All policies shall be
written by insurers acceptable to the additional insureds that have an A.M.
Best's Rating of A-VII. Tenants stall require coverages and limits as it
sees fit.
C. Landlord, by approving or inspecting any design, plans, drawings or
specifications or any contract for work or materials or the method of performing
any work by Tenant or its employees, agents, contractors or subcontractors, does
not assume any responsibility or liability as to the safety, adequacy,
sufficiency, legality or otherwise of what is approved or inspected, which
responsibility or liability shall be and remain with Tenant.
ARTICLE XVIII. INSURANCE
-------------- ---------
Tenant, at its expense, shall procure and maintain at all times during the
Lease Term, or any renewal, extension, or holding over thereof, a policy or
policies of (i) commercial general, automobile liability, and property damage
insurance, insuring Landlord and Tenant, as their respective interests may
appear, against claims for personal injury, including death, and property
damage, including use thereof with $2,000,000.00 combined single limit for both
bodily injury and property damage occurring in, on or about the Premises; and
(ii) fire and extended coverage insurance on the Premises and improvements
located on the Premises in an amount equal to the full replacement value thereof
and with reasonable deductibles. Such policies of insurance shall contain a
provision for not less than thirty (30) days' prior written notice to Landlord
and any mortgagee of Landlord in the event of cancellation or material
modification of the terms and conditions thereof. Such insurance may be provided
under a blanket policy, provided that an endorsement naming Landlord as an
additional insured and loss payee is attached thereto. Landlord and Tenant each
agree that neither Landlord nor Tenant (and their successors and assigns) will
13
have any claim against the other for any loss, damage or injury which is covered
by insurance carried by either party and for which recovery from such insurer is
made, notwithstanding the negligence of either party in causing the loss. This
release shall be valid only if the insurance policy in question expressly
permits waiver of subrogation or if the insurer agrees in writing that such
waiver of subrogation will not affect coverage under said policy. Each party
agrees to use its best efforts to obtain such an agreement from its insurer if
the policy does not expressly permit a waiver of subrogation. All policies of
insurance hereunder as to which Tenant is obligated to pay premiums shall
expressly provide that Landlord has no obligation to pay premiums or other
charges in respect thereof. All insurance required to be maintained by Tenant
shall be carried with a company or companies reasonably acceptable to Landlord
licensed or authorized to do business in the state where the Property is
located, with an AM Best's rating of A-VII or better, shall be written for terms
of not less than one year, unless the Landlord is notified, and Tenant shall
furnish Landlord (and any other parties required to be designated as additional
insureds under any policies) with certificates evidencing the maintenance of
such insurance and the payment of the premiums therefor, and with renewals
thereof at least ten (10) days prior to the expiration of any such policy. Upon
Tenant's default in obtaining or delivering any such policy or policies or
failure to pay the premiums therefor, Landlord may (but shall not be obligated
to) secure or pay the premium for any such policy or policies and charge Tenant
as Additional Rent therefor. Notwithstanding anything herein to the contrary,
Landlord shall have the right, at any time, to reject insurance provided
hereunder by an insurance company that does not have an A.M. Best's rating of
A-VII.
During the Term, and any renewal term, Tenant, at its own cost and expense,
shall provide and keep in force rent insurance in favor of the Landlord in an
amount not less than Rent payable hereunder. Only Landlord shall be named as an
insured under this coverage
All insurance coverage amounts may be increased from time to time at the
reasonable discretion of the Landlord in order to afford proper protection to
both Landlord and Tenant. In order to satisfy the requirements of this Section
as to limits of coverage and any increases thereof, Landlord shall accept
Tenant's extended or umbrella coverage as evidence of satisfactory limits
hereunder. Notwithstanding anything herein to the contrary contained, the
maximum limits of liability insurance which Landlord may require at any time for
the individual coverages set forth in Article XVIII as to the various liability
coverages shall be $5,000,000. Tenant shall, at all times during the term or any
renewal term, maintain and keep in full force and effect excess or umbrella
coverage in an amount at least equal to $5,000,000.
ARTICLE XIX. INDEMNIFICATION
------------ ---------------
A. (a) Tenant, its successors and assigns, shall indemnify, defend with
counsel approved by Landlord, and hold Landlord, its officers, directors,
employees, contractors, attorneys and agents, harmless from and against any and
all claims, judicial, administrative and private-party actions and proceedings,
costs, penalties, expenses (including, but not limited to, attorneys' fees,
consultants' fees, laboratory fees and natural resource damages), judicial or
administrative orders, including, without limitation, any and all governmental
or administrative claims, proceedings or actions which result solely from the
release by Tenant of Hazardous Materials from Tenant's business operations at
the Premises in violation of Hazardous Substance Laws, and which release may
have occurred either during Tenant's occupancy of the Premises prior to the
Lease Term or during the Lease Term but prior to the termination date of this
Lease solely as the result of Tenant's business operations on the demised
premises.
14
(b) The term "Hazardous Materials" means and shall include (i) all
--------------------
elements or compounds that are contained in the list of hazardous
substances adopted by the United States Environmental Protection Agency and
the list of toxic pollutants designated by Congress or the Environmental
Protection Agency or under any of the Hazardous Substance Laws as defined
below; and (ii) any hazardous waste, hazardous substance, hazardous
materials (including, but not limited to, petroleum and petroleum-related
products, material, and substances), toxic substance, regulated substance,
pollutant or contaminant as defined under any Hazardous Substance Laws.
(c) "Hazardous Substance Laws" means the following provisions, as they
------------------------
shall be in effect from time to time, and any and all regulations adopted
and publications promulgated pursuant thereto: the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended,
42 U.S.C. ss. 9601 et seq., the Resource Conservation and Recovery Act, as
amended, 42 U.S.C. ss. 6901 et seq., the Federal Water Pollution Control
Act, as amended, 33 U.S.C. ss. 1251 et seq., the Toxic Substances Control
Act, 15 U.S.C. ss. 2601 et seq., the Hazardous Liquid Pipeline Safety Act
of 1979, as amended, 40 U.S.C. ss. 2001 et. seq., the Hazardous Materials
Transportation Act, as amended, 49 U.S.C. ss. 1801, et seq., the Safe Water
Drinking Act, 42 U.S.C. ss. 300F, et seq., the Clean Water Act, 33 U.S.C.
ss. 1251, et seq., the Environmental Protection Agency regulations
pertaining to asbestos, including 40 C.F.R Part 61, Subpart M, the
Occupational Safety and Health Administration regulations pertaining to
asbestos, including 29 C.F.R. xx.xx. 1901.1001 and 1926.58, the Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. ss. 136 et seq., the
Federal Clean Air Act, as amended 42 U.S.C. ss. 7401 et seq., any so called
federal, state or local "superfund" or "superlien" statute, and any other
federal, state or local law, rule, regulation or ordinance related to
environmental, health, safety, or welfare matters of any kind or nature
whatsoever.
(d) The indemnifications provided for in this paragraph shall survive
the Lease Term.
ARTICLE XX. DEFAULT AND REMEDIES
----------- --------------------
A. Defaults. It shall be an event of default: (a) If Tenant does not pay in
--------
full when due any and all installments of Base Rent or Additional Rent or any
other charges or payments; or (b) If either party violates or fails to perform
or otherwise breaches any agreement, term, covenant or condition contained in
this Lease; or (c) If substantially all of Tenant's assets in or on the Premises
or Tenant's interest in this Lease is attached or levied upon under execution
(and Tenant does not discharge same within sixty (60) days thereafter).
15
B. Landlord Remedies. Upon the occurrence of an event of default by Tenant
-----------------
hereunder, and the expiration of the applicable grace period as hereinafter
provided, Landlord shall have the following rights: (a) To accelerate the whole
or any part of the Rent for the entire unexpired balance of the Lease Term, and
any Rent if so accelerated shall, in addition to any and all installments of
Rent already due and payable and in arrears, be deemed due and payable as if, by
the terms and provisions of this Lease, such accelerated Rent was on that date
payable in advance; and (b) To re-enter the Premises, together with all
additions, alterations and improvements, and, at the option of Landlord, remove
all persons and all or any property therefrom, by any suitable action or
proceeding at law, and repossess and enjoy the Premises. Upon recovering
possession of the Premises by reason of or based upon or arising out of a
default on the part of Tenant, Landlord may, at Landlord's option, either
terminate this Lease or Tenant's right of possession, and in either such event,
make such alterations and repairs as may be necessary in order to relet the
Premises and thereafter relet the Premises. If rentals received from such
reletting during any month shall be less than that to be paid during that month
by Tenant, Tenant shall pay any such deficiency to Landlord. Notwithstanding
anything to the contrary herein, Landlord shall have a duty to mitigate the
damages recoverable by Landlord due to a default by Tenant under this Lease.
C. Non-Waiver. No waiver by either party of any breach by the other party
----------
or any of the other party's obligations, agreements or covenants herein shall be
a waiver of any subsequent breach or of any obligation, agreement or covenant,
nor shall any forbearance by either party to seek a remedy for any breach by the
other party be a waiver by such non-breaching party of any rights and remedies
with respect to such or any subsequent breach.
D. Cure Period. Notwithstanding anything hereinabove stated, except in the
-----------
case of emergency, and except in the event of any default enumerated in
subparagraph (c) of Article XX(A) above, Landlord or Tenant, as the case may be,
will not exercise any right or remedy provided for in this Lease or allowed by
law unless, with respect to any default by Tenant in the payment of Rent, Tenant
does not cure the default within five (5) days after written demand for payment
by Landlord or its authorized agent or property manager of such Rent or unless,
with respect to any other default by either party in the prompt and full
performance of any other provision of this Lease, the defaulting party does not
cure (or in the case of a default that cannot reasonably be cured within thirty
(30) days, does not commence and diligently proceed to cure) same within thirty
(30) days after written demand by the non-defaulting party or its authorized
agent that the default be cured.
E. Rights and Remedies Cumulative. No right or remedy herein conferred upon
------------------------------
or reserved to either party is intended to be exclusive of any other right or
remedy provided herein or by law, but each shall be cumulative and in addition
to every other right or remedy given herein or now or hereafter existing at law
or in equity or by statute.
F. Tenant Remedies; Curing Landlord's Default. In the event of an act of
--------------------------------------------
default by Landlord, Tenant may, at its option:
(a) Give Landlord not less than thirty (30) days written notice of
termination of this Lease, in which case this Lease will terminate the
specified number of days after the notice is received unless by that date
Landlord has cured the default.
(b) Perform the obligation as to which Landlord is in default, in
which case the amount of Tenant's expenses incurred in performing
Landlord's obligation shall, at the Tenant's option, be paid by Landlord
upon demand by Tenant as they become due or be offset against Rent next due
and payable under this Lease.
16
G. Curing Tenant's Defaults. If Tenant shall be in default in the
--------------------------
performance of any of its obligations hereunder, Landlord, without any
obligation to do so, in addition to any other rights it may have in law or
equity, may elect (but shall not be obligated) to cure such default on behalf of
Tenant after written notice (except in the case of emergency) to Tenant. Tenant
shall reimburse Landlord upon demand for all costs and expenses paid or incurred
by Landlord in curing such default, including interest thereon from the
respective dates of Landlord's making the payments and incurring such costs, at
the rate set forth in Article III(B), which sums and costs together with
interest thereon shall be deemed "Additional Rent" payable promptly upon being
billed therefor.
H. Self Help. The performance by either party of the defaulted obligation
---------
of the other party shall be deemed a cure of that default, giving rise to an
obligation of the other party to pay the performing party the amount of its cost
of performance. However, the failure to pay said amount within ten (10) days
after written demand therefor shall be an act of default without the necessity
of any further notice or opportunity to cure, anything contained in Article
XX.(D) to the contrary notwithstanding. In determining the cost of either party
performing the obligation of the other under this Lease, the performing party
may include all reasonable costs incurred in performing the other party's
obligation.
ARTICLE XXI. ATTORNEYS FEES
------------ --------------
In the event either party hereto brings or commences legal proceedings to
enforce any of the terms of this Lease, the successful party shall then be
entitled to receive from the other party, a reasonable sum of attorneys' fees
and costs, to be fixed by the court in the same action.
ARTICLE XXII. NOTICES
------------- -------
All notices and other communications hereunder (hereinafter collectively
referred to as "notices") required to be given or which may be given hereunder
shall be in writing and shall be sent by (a) certified or registered mail,
return receipt requested, postage prepaid, or (b) national prepaid overnight
delivery service, or (c) telecopy or other facsimile transmissions (followed
with "hard" copy sent by national prepaid overnight delivery service), or (d)
personal delivery with receipt acknowledged in writing, directed as follows:
Landlord: The Address designated in Article I(A)
Tenant: The Address designated in Article I(B)
Any notice so sent by certified or registered mail shall be deemed given on
the date of receipt or refusal as indicated on the return receipt. Any notice
sent by telecopy or other facsimile transmission shall be deemed given when the
"hard" copy sent by national prepaid overnight delivery service is received or
refused. All other notices shall be deemed given when actually received or
refused by the party to whom the same is directed. A notice may be given either
by a party or by such party's attorney. Either party may designate by notice
given to the other in accordance with the terms of this Article XXII, additional
or substitute parties or addresses to whom notices should be sent hereunder.
17
ARTICLE XXIII. CERTIFICATES AND SUBORDINATION
-------------- ------------------------------
A. Certificates. Either party shall, without charge, at any time and from
------------
time to time hereafter, within ten (10) days after written request of the other,
certify by written instrument duly executed and acknowledged to any (i)
beneficiary under a deed of trust encumbering the Premises, (ii) purchaser of
the Premises, (iii) assignee of Tenant's leasehold, (iv) sublessee of Tenant, or
(v) any proposed beneficiary, purchaser, assignee or sublessee:
(a) As to whether this Lease has been supplemented or amended, and if
so, identifying the documents that do so;
(b) As to the validity and force and effect of this Lease, in
accordance with the tenor as then constituted;
(c) As to the existence of any default under this Lease, and if so,
specifying the same;
(d) As to the performance of any specific obligation under this Lease;
(e) As to the dates to which the annual rent, percentage rent,
additional rent and any other charges due under this Lease have been paid;
(f) As to the existence of any offset, counterclaims or defenses on
the part of either party;
(g) As to the commencement and expiration dates of the term of this
Lease and the number and length of any renewal options; and
(h) As to any other specific matter as may reasonably be requested.
B. Subordination.
-------------
(a) This Lease is subject and subordinate to any mortgage and/or deed
of trust which may now or hereafter affect this Lease or the Premises, and
to all renewals, modifications, consolidations, replacements and extensions
thereof. This clause shall be self-operative and no further instrument of
subordination shall be required by any mortgagee or trustee. In
confirmation of such subordination, Tenant shall execute promptly any
confirmation of such subordination, Tenant shall execute promptly any
certificate that Landlord may request. Notwithstanding the foregoing, the
party secured by any such deed of trust or mortgage shall have the right to
recognize this Lease and, in event of any foreclosure sale under such deed
of trust or mortgage, this Lease shall continue in full force and effect at
the option of the party secured by such deed of trust or mortgage or the
purchaser under any such foreclosure sale; and Tenant covenants and agrees
that it will, at the written request of the party secured by any such deed
of trust or mortgage, execute, acknowledge and deliver any instrument that
has for its purpose and effect the subordination to said mortgage or deed
of trust of the lien of this Lease.
18
(b) Tenant agrees to give any mortgagees and/or trust deed holders, by
Registered Mail, a copy of any notice of default served upon the Landlord,
provided that prior to such notice Tenant has been notified, in writing (by
way of notice of assignment of rents and leases, or otherwise), of the
address of such mortgagees and/or trust deed holders. Tenant further agrees
that if Landlord shall have failed to cure such default within the time
provided for in this Lease, then the mortgagees and/or trust deed holders
shall have an additional thirty (30) days within which to cure such default
or if such default cannot be cured within that time, then such additional
time as may be necessary if within such thirty (30) days, any mortgagee
and/or trust deed holder has commenced and is diligently pursuing the
remedies necessary to cure such default, (including but not limited to
commencement of foreclosure proceedings, if necessary to effect such cure)
in which event this Lease shall not be terminated while such remedies are
being so diligently pursued. Landlord agrees that it will, upon request
from Tenant from time to time, confirm to Tenant the name and address of
Landlord's current mortgagee and/or trust deed holders entitled to notice
hereunder. In no event, however, shall a notice by Tenant to Landlord
hereunder be deemed defective by reason of Tenant's failure to notify such
mortgagees and/or trust deed holders if Tenant has used good faith efforts
to determine the identities and addresses of such mortgagees and/or trust
deed holders by requesting same form Landlord.
(c) Tenant shall attorn to any foreclosing first mortgagee, purchaser
at a foreclosure sale, or purchaser by deed in lieu of foreclosure, but no
such mortgagee or purchaser shall be (i) bound by any payment of rent,
additional rent or other charge made more than one (1) calendar month in
advance of the due date thereof, or (ii) bound by any amendment or
modification to this Lease made without the express written consent of such
mortgagee or purchaser, provided that such mortgagee or purchaser provides
prompt written notice to Tenant of the termination of its interest in the
Premises.
(d) Upon request of Tenant, the Landlord will execute a Landlord's
Agreement with any lender of Tenant upon substantially the same terms and
conditions as are contained in the form of Landlord's Agreement attached
hereto as Exhibit B.
ARTICLE XXIV. LANDLORD REPRESENTATIONS AND WARRANTIES
------------- ---------------------------------------
Landlord warrants and represents that:
(a) Landlord holds title to the Premises;
(b) It has the authority to enter into this Lease;
Landlord covenants that as of the Commencement Date:
That all of the warranties and representations contained in Subsections
(a) and (b) above shall be true; and
19
Neither the acceptance of the Premises nor the commencement of the
payment of Rent shall be deemed a waiver of these covenants.
The covenants, warranties and representations contained in this
Article XXIV shall be deemed breached when Tenant knows of the breach. In
the event of such a breach, Tenant, in addition to any other remedy it may
have, may terminate this Lease in the manner provided by Article XX(F).
ARTICLE XXV. INTENTIONALLY DELETED
------------ ---------------------
ARTICLE XXVI. MISCELLANEOUS
------------- -------------
A. Binding Effect. This Lease shall be binding upon and inure to the
---------------
benefit of Landlord and Landlord's successors and assigns. This Lease shall be
binding upon and inure to the benefit of Tenant and Tenant's heirs, legal
representatives, successors and assigns.
B. Entire Agreement. This Lease and the Exhibits and Rider (if any)
-----------------
attached to this Lease set forth all the covenants, promises, assurances,
agreements, representations, conditions, warranties, statements and
understandings (the "Representations" collectively) between Landlord and Tenant
concerning the Premises and there are no Representations, either oral or
written, between them other than those in this Lease. This Lease supersedes and
revokes all previous negotiations, arrangements, letters of intent, offers to
lease, reservations of space, lease proposals, brochures, Representations and
information conveyed, whether oral or in writing, between the parties or their
respective representatives or any other person purporting to represent Landlord
or Tenant. No subsequent alteration, amendment, change or addition to this Lease
shall be binding upon Landlord or Tenant unless in writing signed by both
parties. All Exhibits attached to this Lease are made a part of this Lease and
incorporated by this reference into this Lease.
C. No Accord. No payment by Tenant or receipt by Landlord of a lesser
---------
amount than any installment or payment of Rent due shall be deemed to be other
than on account of the amount due, and no endorsement or statement on any check
or any letter accompanying any check or payment of Rent shall be considered an
accord and satisfaction, and Landlord may accept such check or payment without
prejudice to Landlord's right to recover the balance of such installment or
payment of Rent or pursue any other remedies available to Landlord. No receipt
of money by Landlord from Tenant after the termination of this Lease or Tenant's
right to possession of the Premises shall reinstate, continue or extend the
Term. Landlord may allocate payments received from Tenant to outstanding account
balances of Tenant under this Lease in the manner determined by Landlord and
Landlord shall not be bound by any allocations of such payments made by Tenant
by notation or endorsement on checks or otherwise.
D. Broker. Tenant represents to Landlord that except for the brokers stated
------
in Article I(F), Tenant has not dealt with any real estate broker, sales person,
or finder in connection with this Lease, and no such person initiated or
participated in the negotiation of this Lease, or showed the Premises to Tenant.
Tenant agrees to indemnify, defend and hold Landlord harmless from and against
any and all claims, demands, liabilities, actions, damages, costs and expenses
(including reasonable attorneys' fees) for brokerage commissions or fees arising
out of a breach of such representation.
20
E. Memorandum of Lease and Option. For the purposes of recording some of
------------------------------
the basic terms and conditions of this Lease, including the Options to Purchase,
Landlord and Tenant agree to execute, within 30 days after the execution of this
Lease, a short form of Lease prepared by Tenant and approved by Landlord. It is
understood that such short form of Lease is for purposes of recordation only and
is not intended and shall not in any way modify, amend, supersede, or otherwise
affect this Lease.
F. No Waiver. The receipt by Landlord of any Rent with knowledge of the
---------
breach of any covenant of this Lease by Tenant shall not be deemed a waiver of
such breach or any subsequent breach of this Lease by Tenant and no provision of
this Lease and no breach of any provision of this Lease shall be deemed to have
been waived by Landlord unless such waiver be in writing signed by Landlord.
G. Applicable Law. This Lease shall be construed in accordance with the
---------------
laws of the State in which the Premises are situated.
H. Time. Time is of the essence of this Lease and the performance of all
----
obligations under this Lease.
I. Severability. If any clause, phrase, provision or portion of this Lease
------------
or the application of same to any person or circumstance shall be invalid or
unenforceable under applicable law, such event shall not affect, impair or
render invalid or unenforceable the remainder of this Lease, nor any other
clause, phrase, provision or portion of this Lease, nor shall it affect the
application of any clause, phrase, provision or portion of this Lease to other
persons or circumstances.
J. No Waste. Tenant covenants, subject to the terms of this Lease, not to
--------
do or suffer any waste or damage to, or impairment of the value of, the
Premises.
K. Inspections. Tenant agrees to permit Landlord and the authorized
-----------
representatives of Landlord, upon reasonable notice from Landlord, to enter the
Premises at all reasonable times for the purposes of (a) inspecting the same,
and (b) making any necessary repairs to the Premises and performing any work
therein that may be necessary by reason of Tenant's default under the terms of
this Lease. Nothing herein shall imply any duty upon the part of Landlord to do
any work which under any provision of this Lease, Tenant may be required to
perform and the performance thereof by Landlord shall not constitute a waiver of
Tenant's default in failing to perform the same. Landlord may, during the
progress of any such work in the Premises, keep and store upon the Premises all
necessary materials, tools and equipment. Landlord shall not in any event be
liable for any inconvenience, annoyance, disturbance, or damage to Tenant or any
permitted sublessee or occupant of the Premises by reason of making such repairs
or the performance of any such work in the Premises, or on account of bring
materials, supplies and equipment into or through the Premises during the course
thereof, and the obligations of Tenant under this Lease shall not thereby be
affected in any manner whatsoever.
21
ARTICLE XXVII. OPTION TO PURCHASE
-------------- ------------------
A. Purchase Option. In consideration of the Premises, Landlord hereby
grants to Tenant the option ("Purchase Option") to purchase the Premises.
Provided that Tenant is not in default of its obligations under this Lease,
Tenant may exercise the Purchase Option at any time during and prior the the end
of the fifth year of the Lease Term by giving to Landlord written notice to that
effect which designates the date on which the sale and purchase of the Premises
shall be closed ("Exercise Notice"), which closing date shall be at any time
within 90 days from the date of such Exercise Notice. A deposit of $50,000.00
shall be deposited with the agent appointed in connection with the Escrow, as
hereinafter defined within three (3) days of the date of the Exercise Notice.
If Tenant does not exercise the Purchase Option by giving the Exercise
Notice, or if the Tenant fails to pay the Purchase Option Price ( as defined
below) within 30 days after it is then due and payable, or if the Lease is
terminated in accordance with its terms prior to the expiration date of the
Lease, then the Purchase Option shall thereupon terminate and neither Landlord
nor Tenant shall have any right, obligation or liability under this Article
XXVII.
B. Purchase Option Price. Tenant shall pay to Landlord on an all cash basis
---------------------
the sum of: $2,157,687.50 for the purchase price of the Premises in the event it
exercises the Purchase Option (the "Purchase Option Price").
C. Closing. Upon Tenant's exercise of the Purchase Option, the sale and
-------
purchase of the Premises shall be consummated ("Closing") on the date ("Closing
Date") which is selected by Tenant in the Exercise Notice. Notwithstanding
anything herein to the contrary, the Closing Date shall occur no later than
ninety (90) days after the issuance of the Exercise Notice.
The Closing shall take place through a deed and money escrow ("Escrow")
with the Escrowee or any other agent acceptable to Tenant. Payment of the
Purchase Price and delivery of the "Deed" (as hereafter defined) and other
documents required to be delivered at the Closing shall be made through the
Escrow. The cost of the Escrow shall be divided equally between Landlord and
Tenant, except in the event of a default, in which case the party at fault shall
pay for the entire cost of the Escrow.
At the Closing, Landlord shall sell and convey to Tenant (or Tenant's
nominee) good and marketable fee simple title to the Premises by a recordable
Special Warranty Deed ("Deed") subject only to current non-delinquent real
estate taxes and such other easements or exceptions which, in Tenant's
reasonable determination, do not materially and adversely affect the value,
development, use or ownership of the Premises (the "Permitted Exceptions").
22
D. Title and Survey. Not less than thirty (30) days prior to the Closing
-----------------
Date, Landlord shall deliver to Tenant a commitment (the "Commitment") in the
amount of the Purchase Price issued by the Title Company as shall be acceptable
to the parties and a current survey ("Survey") of the Premises prepared by a
registered New York land surveyor in accordance with 1999 ALTA/ASCM Minimum
Survey Standards certified to Tenant and the Title Company which contains an
accurate legal description of the Premises and indicates the following: (i) the
boundary lines of the Premises and the number of square feet contained therein;
(ii) the location and course of all utility and other lines and easements,
either visible or recorded, and the recording references thereof; (iii) all
public and private streets, roads, driveways, and rights-of-way on or abutting
the Premises; and (iv) no encroachments by any improvements from adjoining
property onto the Premises. The Survey shall be in form and content sufficient
to cause the Title Company to delete all survey exceptions from the "Title
Policy" (as hereinafter defined). If the Commitment discloses encumbrances or
exceptions to title other than the Permitted Exceptions (such other exceptions
being referred to as "Unpermitted Exceptions"), or the Survey furnished to
Tenant does not comply with the foregoing requirements (any items which cause
the Survey not to comply being referred to as "Survey Defects"), Landlord, at
its sole cost and expense, shall cause the Unpermitted Exceptions to be removed
from the Commitment and Survey Defects to be removed prior to the Closing.
If the Survey Defects and Unpermitted Exceptions, if any, have not been so
removed prior to the Closing, Tenant, at is sole option and upon notice to
Landlord, may elect to terminate its exercise of the Option or proceed to
Closing, and accept title subject to such Survey Defects and Unpermitted
Exceptions. In the event the Option is so terminated, neither party shall have
any further liability or obligation hereunder.
Landlord, at Landlord's expense, shall furnish through the Escrow to
Tenant, and the consummation of the Closing shall be conditioned upon the
issuance to Tenant by the Title Company of an ALTA Owner's Title Insurance
Policy Form B-1992 (the "Title Policy") in the amount of the Purchase Price,
insuring fee simple title to the Premises in Tenant (or Tenant's nominee),
subject only to the Permitted Exceptions, and containing such endorsements as
are specified by Tenant, including, without limitation, an extended coverage
endorsement deleting the general exceptions customarily set forth in the Title
Policy.
E. Prorations and Costs. Rent shall be prorated on a statement ("Closing
--------------------
Statement") as of the Closing Date on amortized basis. There shall be no
proration of the real estate taxes. Landlord shall pay for the Commitment and
Title Policy to be issued by the Title Company, the cost of recording documents
to clear Landlord's title and all recording costs other than those to be paid by
Tenant, the local real estate conveyance taxes with respect to the Deed, the
cost of the Survey and one-half of the cost of the Escrow. Tenant shall pay for
the cost of recording the Deed and one-half of the cost of the Escrow.
F. Landlord's Closing Documents. At the Closing, Landlord shall furnish to
----------------------------
Tenant by depositing the same in the Escrow the following documents, each of
which shall be in a form reasonably satisfactory to Tenant's counsel:
(i) The Deed executed by Landlord conveying the Tenant or nominee good
and marketable title to the Premises in fee simple, free and clear of all
liens, claims, encumbrances, assessments, restriction and exceptions except
for the Permitted Exceptions;
23
(ii) Affidavit of Title in customary form executed by Landlord;
(iii) A Survey of the Premises which satisfies the requirements above;
(iv) Closing Statement referred to above signed by Landlord; and
(v) Letter(s) from the holder(s) of any existing mortgage affecting
all or any portion of the Premises indicating the sum required to be paid
at the Closing in order to release the Premises from the lien thereof.
G. Tenant's Closing Documents. Provided that Landlord has performed all of
--------------------------
its obligations under this Article XXVII including, without limitation, the
making of all deposits in the Escrow required under subsection (F) above, Tenant
shall deposit or cause to be deposited in the Escrow the following:
(i) The Purchase Price, plus or minus net credits and prorations in
immediately available funds; and
(ii) Closing Statement signed by Tenant.
H. The provisions of Article XI and Article XV shall be applicable in the
event the occurrences described in those Articles occurs prior to the Closing
Date. The rights of Tenant or Landlord thereunder to terminate this Lease as set
forth in those Articles shall continue if the events described in those Articles
occur prior to the Closing Date.
I. In the event Tenant shall fail to consummate the purchase transaction
set forth herein for any reason, except for Landlord's inability to deliver
title in accordance herewith, Tenant shall forfeit its Purchase Option exercise
deposit and any earned interest which shall be retained by Landlord as
liquidated damages under this Article XXVII. Tenant shall, as a result of such
default, forever forfeit its option rights hereunder which shall be deemed
extinguished by its inability to close hereunder. Notwithstanding Tenant's
exercise of the Purchase Option hereunder, or its failure to close, the rental
payments and all other obligations hereunder shall continue until title to the
Premises has passed to Tenant hereunder. In the event Landlord is unable to
deliver title to the Premises pursuant to the terms of this Article XXVII to
Tenant, then Tenant shall be entitled to a refund of its deposit and all earned
interest thereon, and upon such refund the Purchase Option rights hereunder
shall be deemed extinguished, provided however Tenant shall be entitled to any
remedy it may have at law with respect to Landlord's failure to perform its
obligations pursuant to Tenant's exercise of its Purchase Option. Landlord's
inability to deliver title or Tenant's inability to close in accordance with
this Article XXVII shall not constitute a default by Landlord or Tenant
hereunder and Tenant's obligations under this Lease shall continue in accordance
with these Lease terms, notwithstanding such failure to consummate the Closing
hereunder.
24
IN WITNESS WHEREOF, the parties have signed triplicate counterparts hereof
as of the date and year hereinabove set forth.
LANDLORD: TENANT:
-------- ------
BRADCO SUPPLY CORPORATION WICKES INC., a Delaware corporation
a New Jersey corporation
By:___________________________
By:___________________________ Its:__________________________
Its:__________________________
25
STATE OF _________ )
) SS.
COUNTY OF ________ )
THIS DAY, PERSONALLY APPEARED BEFORE ME, the undersigned authority in and
for the state and county aforesaid, the within named _______________ of Bradco
Supply Corporation, a New Jersey corporation, who acknowledged that as such
_________, he signed and delivered the above and foregoing Lease on the day and
in the year therein mentioned, and for the purposes therein stated as the
voluntary act and deed of said partnership, pursuant to full authority in him
duly vested to do so.
GIVEN UNDER MY HAND AND OFFICIAL SEAL OF OFFICE, this _____ day of
_________, 2003.
---------------------------
NOTARY PUBLIC
[SEAL]
STATE OF ___________ )
) SS.
COUNTY OF __________ )
THIS DAY, PERSONALLY APPEARED BEFORE ME, the undersigned authority in and
for said county and state, the within named, __________________, acting
____________________ of WICKES INC., who acknowledged that as such officer, he
signed and delivered the above and foregoing Lease on the day and in the year
therein mentioned and for the purposes therein stated, as the voluntary act and
deed of such corporation, pursuant to full authority in him duly vested to do
so.
GIVEN UNDER MY HAND AND OFFICIAL SEAL OF OFFICE, this _____ day of
__________, 2003.
---------------------------
NOTARY PUBLIC
[SEAL]
26
EXHIBIT A
---------
LEGAL DESCRIPTION OF PREMISES
-----------------------------
ALL THAT CERTAIN lot or piece of ground, Situated in Xxxx Xxxxxxxxx Xxxxxxxx,
Xxxxxxx Xxxxxx, Xxxxx xx Xxxxxxxxxxxx described as follows:
BEGINNING at a spike in the Lionville-Xxxxxxxx Road said spike North 29 degrees
20 minutes West 158 feet from a spike marking the intersection of said road and
the center of the Reading Railroad right of way; thence still by said road North
29 degrees 20 minutes West 242.00 feet to a spike; thence by S.R. Xxxxxx the
following two courses and distances: (1) North 62 degrees 52 minutes East
(passing over an iron pin on the East side of said road) 1,000.00 feet to an
iron pin; (2) South 29 degrees 20 minutes East 400 feet to the center of the
Reading Railroad; thence by said Railroad South 62 degrees 52 minutes West 873.5
feet (passing over iron pipes) to the corner of lands of the Philadelphia
Electric Company; thence by said Philadelphia Electric Company the following two
courses and distances; (1) North 29 degrees 20 minutes West 158 feet to a point;
(2) South 62 degrees 52 minutes West 126.5 feet to the point of beginning.
CONTAINING 8.717 acres more or less.
XXXXXXX COUNTY TAX PARCEL 41-5-129.3
BEING the same premises which Xxxxx X. Xxxxxx, singlewoman by deed dated
7/13/1973 and recorded in the County of Xxxxxxx in Deed Book 1139 page 429,
granted and conveyed unto Wickes Lumber Company, a Delaware corporation, in fee.
27
EXHIBIT B
---------
Landlord's Agreement
--------------------
LANDLORD'S WAIVER
THIS LANDLORD'S WAIVER (this "Agreement"), executed and delivered as of this
_____ day of _________, 2003, by and between Bradco Supply Corporation, a New
Jersey corporation ("Landlord"), Wickes Inc., a Delaware corporation
("Borrower"), and Xxxxxxx Xxxxx Capital, a division of Xxxxxxx Xxxxx Business
Financial Services Inc., as agent ("Agent") for certain lenders ("Lenders").
W I T N E S S E T H
-------------------
WHEREAS, Agent, Lenders and Borrower have entered, and may from time to time
hereafter enter, into various agreements, instruments and documents
(collectively the "Financing Agreements") providing for Agent and Lenders to
make or cause to be made certain financial accommodations for the benefit of
Borrower; and WHEREAS, to secure payment and performance of all of Borrower's
obligations and liabilities to Agent and Lenders under the Financing Agreements
("Borrower's Liabilities"), Agent and Lenders have required that Borrower grant
to Agent a security interest in all of Borrower's personal property and all
products and proceeds of the foregoing (the "Collateral"); and WHEREAS, all or
some of the Collateral is now or from time to time hereafter may be located at
the premises known as 000 X. Xxxxxxxx Xxxx, Xxxxx, Xxxxxxxxxxxx 00000 (the
"Premises") and legally described on Exhibit A hereto, which Premises are owned
and leased by Landlord to Borrower pursuant to a certain Lease dated
_______________, 2003, a true and correct copy of which is attached hereto as
Exhibit B (such Lease, together with any and all renewals, extensions,
amendments, modifications, substitutions, and replacements thereof, being
hereinafter referred to as the "Lease"); and WHEREAS, Landlord wishes to
continue to lease the Premises to Borrower and receive rental payments therefor
pursuant to the Lease and, accordingly, wishes for Borrower to remain in
business and continue to operate the same; and WHEREAS, Borrower, to remain in
business and continue to operate the same, may require, or receive the benefit
of, loans or advances from Agent and Lenders pursuant to the Financing
Agreements, and Agent and Lenders, as a condition precedent to making such loans
or advances, have required Landlord and Borrower to execute and deliver this
Agreement; NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration the receipt and sufficiency of which is hereby
acknowledged, Landlord hereby covenants and agrees with Agent as follows:
Landlord hereby certifies, as of the date hereof, that (a) the Lease is in full
force and effect, (b) the Lease has not been modified, supplemented or amended
in any way, and (c) there is no default by Borrower in the performance of any of
its obligations under the Lease, and there is no fact or circumstance which,
with the giving of notice or the passage of time, would become a default.
28
Landlord agrees that the Collateral is and shall remain personal property
notwithstanding the manner or mode of the attachment of any item of Collateral
to the Premises, and is not, and shall not become, or be deemed to be, fixtures.
In the event Agent notifies Landlord of a default by Borrower under the
Financing Agreements and of Agent's election to remove the Collateral from the
Premises, Agent may enter the Premises for the purpose of repossessing,
removing, selling, or otherwise dealing with the Collateral or any part thereof
in accordance with the terms and conditions of the Financing Agreements without
objection, delay, hindrance or interference by Landlord and in such case
Landlord will make no claim or demand whatsoever against the Collateral. Without
limitation of the foregoing, Landlord agrees that it will permit Agent to enter
and remain on the Premises to remove the Collateral for up to ninety (90) days
after Agent notifies Landlord of a default, so long as Agent (a) pays rent to
Landlord at the rate applicable under the Lease, together with any and all other
monetary amounts payable under the Lease, and (b) delivers to Landlord a
certificate of liability insurance for the Premises to the extent required under
the Lease, which certificate shall identify Landlord as an additional insured,
in the case of (a) and (b) above for the period Agent remains on the Premises.
Among other things, Landlord will cooperate with Agent in its efforts to
assemble all of the Collateral located on the Premises, permit Agent to enter
the Premises to appraise, display, remove, maintain, prepare for sale or lease,
transfer and/or sell the Collateral from the Premises, and not hinder Agent's
actions in enforcing its security interest in the Collateral.
Landlord waives each and every right which Landlord now has or hereafter may
have, under the laws of the State of Pennsylvania, or by virtue of the Lease, or
by virtue of Borrower's occupation of the Premises, to levy or distrain upon,
for rent, in arrears, in advance or both or for any monetary obligation arising
by reason of default under the Lease, or to claim or assert any lien, right,
claim or title to any or all of the Collateral, which now or hereafter may be,
or may be installed, on said Premises. Agent and Landlord hereby agree that the
provisions of this Section 3 are made in favor, and shall inure to the benefit,
of only Agent and its successors and assigns, and to no other persons.
Agent may, without affecting the validity of this Agreement, extend, amend or in
any way modify the terms of the Financing Agreements.
If, for any reason whatsoever, Landlord either deems itself entitled to recover
possession of the Premises during the term of the Lease or intends to sell or
otherwise transfer all or any part of its interest in the Premises, Landlord
will notify Agent at least thirty (30) days before taking such action.
Agent may, at any time or times hereafter, without any fee or charge for rent,
enter upon the Premises to inspect Borrower's assets located on the Premises.
This Agreement shall inure to the benefit of the successors and assigns of Agent
and Lenders and shall be binding upon the heirs, personal representatives,
successors and assigns of Landlord and Borrower. In the event that Landlord
conveys the Premises, Landlord shall give the successor owner notice that it has
entered into this Agreement and shall deliver to such successor owner a copy
hereof.
This Agreement shall continue in force until all of Borrower's obligations and
liabilities are paid and satisfied in full and all obligations of Agent and
Lenders under the Financing Agreements have been terminated.
29
All notices given under this Agreement shall be sent either by U.S. Mail,
postage prepaid, certified, return receipt requested, or by Federal Express or
other overnight courier service, to the addressee thereof, at the following
addresses:
If to Landlord: Bradco Supply Corporation
00 Xxxxxxxxxx Xxx
Xxxxxx, XX 00000
Attn: Treasurer
If to Borrower: Wickes Inc.
000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxx Xxxxx, XX 00000
Attn: Real Estate Department
If to Agent: Xxxxxxx Xxxxx Capital
000 Xxxxx XxXxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Legal Department
[signatures follow]
30
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered as of
the day and year specified at the beginning hereof.
LANDLORD:
Bradco Supply Corporation,
a New Jersey corporation
By_____________________________________________
Its____________________________________________
BORROWER:
Wickes Inc.,
a Delaware corporation
By_____________________________________________
Its____________________________________________
AGENT:
Xxxxxxx Xxxxx Capital, a division of Xxxxxxx
Xxxxx Business Financial Services Inc., as
Agent
By_____________________________________________
Its____________________________________________
