COUNTY OF SARATOGA INDUSTRIAL DEVELOPMENT
AND
ACE HARDWARE CORPORATION
LEASE AGREEMENT
DATED AS OF SEPTEMBER 1, 1996
TABLE OF CONTENTS
(This Table of Contents is not part of the Lease
Agreement and is for convenience of reference only)
SECTION PAGE
ARTICLE I 2
DEFINITIONS 2
SECTION 1.1. DEFINITIONS 2
SECTION 1.2. INTERPRETATION 4
ARTICLE II 6
REPRESENTATIONS, WARRANTIES AND COVENANTS 6
SECTION 2.1. REPRESENTATIONS, WARRANTIES AND COVENANTS
OF THE LESSOR 6
SECTION 2.2. REPRESENTATIONS, WARRANTIES AND COVENANTS
OF THE LESSEE 6
ARTICLE III 9
CONVEYANCE AND USE OF PROJECT FACILITY 9
SECTION 3.1. CONVEYANCE TO THE LESSOR 9
SECTION 3.2. USE OF PROJECT FACILITY 9
ARTICLE IV 10
ACQUISITION OF LAND; CONSTRUCTION OF FACILITY;
ACQUISITION AND INSTALLATION OF EQUIPMENT 10
SECTION 4.1. ACQUISITION OF LAND; CONSTRUCTION
OF FACILITY; ACQUISITION AND INSTALLATION OF EQUIPMENT 10
SECTION 4.2. COMPLETION OF PROJECT FACILITY 11
SECTION 4.3. REMEDIES TO BE PURSUED AGAINST CONTRACTORS,
SUBCONTRACTORS, MATERIALMEN AND THEIR SURETIES 11
ARTICLE V 12
LEASE OF PROJECT FACILITY; RENT; CONVEYANCE OF PROJECT
FACILITY 12
SECTION 5.1. LEASE OF THE PROJECT FACILITY 12
SECTION 5.2. DURATION OF TERM. 12
SECTION 5.3. QUIET ENJOYMENT 12
SECTION 5.4. RENT AND OTHER AMOUNTS PAYABLE 12
SECTION 5.5. NATURE OF OBLIGATIONS OF THE LESSEE HEREUNDER 13
ARTICLE VI 14
MAINTENANCE, MODIFICATIONS, TAXES AND INSURANCE 14
SECTION 6.1. MAINTENANCE AND MODIFICATIONS OF PROJECT
FACILITY 14
SECTION 6.2. TAXES, ASSESSMENTS AND UTILITY CHARGES 14
SECTION 6.3. INSURANCE REQUIRED 14
SECTION 6.4. ADDITIONAL PROVISIONS RESPECTING INSURANCE 15
SECTION 6.5. APPLICATION OF NET PROCEEDS OF INSURANCE 16
SECTION 6.6. PAYMENTS IN LIEU OF TAXES 16
ARTICLE VII 18
DAMAGE, DESTRUCTION AND CONDEMNATION 18
SECTION 7.1. DAMAGE OR DESTRUCTION 18
SECTION 7.2. CONDEMNATION 18
ARTICLE VIII 19
SPECIAL COVENANTS 19
SECTION 8.1. NO WARRANTY OF CONDITION OR SUITABILITY
BY LESSOR; ACCEPTANCE 19
SECTION 8.2. HOLD HARMLESS PROVISIONS 19
SECTION 8.3. RIGHT OF ACCESS TO PROJECT FACILITY 20
SECTION 8.4. THE LESSEE NOT TO TERMINATE EXISTENCE
OR DISPOSE OF ASSETS 20
SECTION 8.5. AGREEMENT TO PROVIDE INFORMATION 20
SECTION 8.6. COMPLIANCE WITH ORDERS, ORDINANCES, ETC 20
SECTION 8.7. PERFORMANCE BY LESSOR OF LESSEE'S OBLIGATIONS 21
SECTION 8.8. DEPRECIATION DEDUCTIONS AND TAX CREDITS 21
ARTICLE IX 22
ASSIGNMENTS; MERGER OF LESSOR 22
SECTION 9.1. RESTRICTION ON TRANSFER OF LESSOR'S INTEREST
HEREUNDER 22
SECTION 9.2. ASSIGNMENT OF THIS LEASE AGREEMENT 22
SECTION 9.3. MERGER OF THE LESSOR 22
SECTION 9.4. SALE OR LEASE OF PROJECT FACILITY 22
ARTICLE X 24
EVENTS OF DEFAULT AND REMEDIES 24
SECTION 10.1. EVENTS OF DEFAULT DEFINED 24
SECTION 10.2. REMEDIES ON DEFAULT 25
SECTION 10.3. REMEDIES CUMULATIVE 25
SECTION 10.4. AGREEMENT TO PAY ATTORNEYS' FEES
AND EXPENSES 26
SECTION 10.5. NO ADDITIONAL WAIVER IMPLIED BY ONE WAIVER 26
ARTICLE XI 27
EARLY TERMINATION OF LEASE AGREEMENT 27
SECTION 11.1. OPTION TO TERMINATE LEASE AGREEMENT 27
SECTION 11.2. OBLIGATION TO SELL AND PURCHASE THE PROJECT
FACILITY 27
SECTION 11.3. CONVEYANCE OF PROJECT FACILITY UPON PURCHASE 27
ARTICLE XII 28
MISCELLANEOUS 28
SECTION 12.1. NOTICES 28
SECTION 12.2. BINDING EFFECT 29
SECTION 12.3. SEVERABILITY 29
SECTION 12.4. AMENDMENTS, CHANGES AND MODIFICATIONS 29
SECTION 12.5. EXECUTION OF COUNTERPARTS 29
SECTION 12.6. APPLICABLE LAW 29
SECTION 12.7. RECORDING AND FILING 29
SECTION 12.8. SURVIVAL OF OBLIGATIONS 29
SECTION 12.9. TABLE OF CONTENTS AND SECTION HEADINGS NOT
CONTROLLING 29
SECTION 12.10. NO RECOURSE; SPECIAL OBLIGATION 29
SECTION 12.11. SUBMISSION TO JURISDICTION 30
EXHIBIT A A-1
DESCRIPTION OF LAND A-1
EXHIBIT B B-1
FORM OF DEED TO LESSEE B-1
EXHIBIT C C-1
FORM OF ▇▇▇▇ OF SALE TO LESSEE C-1
LEASE AGREEMENT
THIS LEASE AGREEMENT dated as of September 1, 1996 ("Lease
Agreement") by and between the COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY, a public benefit corporation of the State of
New York having its office at Saratoga County Municipal Center,
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Lessor")
and ACE HARDWARE CORPORATION, a Delaware corporation having an
address of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
(the "Lessee");
W I T N E S S E T H:
WHEREAS, the Lessor, by resolution adopted September 16,
1996 (the "Resolution"), resolved to undertake a project (the
"Project") consisting of (A) (1) the acquisition of a certain
parcel or parcels of land comprising approximately 130 acres
located at ▇▇▇▇▇▇▇ Road and Northern Pines Road in the Town of
Wilton, Saratoga County, New York (the "Land"), (2) the
construction on the Land of an approximately 792,000 square foot
Facility (the "Facility") for use as a regional warehouse and
distribution facility and (3) the acquisition and installation in
the Facility of certain machinery and equipment (the "Equipment"
and together with the Land and the Facility, collectively the
"Project Facility"); and (B) The lease of the Project Facility to
the Lessee; and
WHEREAS, the Lessor proposes to lease the Project Facility
to the Lessee and the Lessee desires to lease the Project
Facility from the Lessor pursuant to the terms and conditions
hereinafter set forth; and
WHEREAS, the providing of the Project Facility and the lease
of the Project Facility to the Lessee pursuant to this Lease
Agreement is for a proper purpose, to wit, to advance the job
opportunities, health, general prosperity and economic welfare of
the inhabitants of the State of New York, pursuant to the
provisions of the Act (as hereinafter defined); and
WHEREAS, all things necessary to constitute this Lease
Agreement a valid and binding agreement by and between the
parties hereto in accordance with the terms hereof have been done
and performed, and the creation, execution and delivery of this
Lease Agreement have in all respects been duly authorized;
NOW, THEREFORE, THE LESSOR AND THE LESSEE HEREBY AGREE AS
FOLLOWS:
ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITIONS. The terms defined in this Section 1.1
(except as herein otherwise expressly provided or unless the
context otherwise requires) for all purposes of this Lease
Agreement and of any agreement supplemental hereto shall have the
respective meanings specified in this Section 1.1.
"Act" means Title 1 of Article 18-A of the General Municipal
Law of the State, as amended from time to time, together with
Chapter 855 of the Laws of 1971 of the State.
"▇▇▇▇ of Sale to Lessee" means the ▇▇▇▇ of sale from the
Lessor to the Lessee (substantially in the form shown in Exhibit
"C" hereto) to be delivered to the Lessee upon satisfaction of
the conditions set forth herein.
"▇▇▇▇ of Sale to Lessor" means the ▇▇▇▇ of sale from the
Lessee to the Lessor conveying the Lessee's interest in the
Equipment.
"Bond Counsel" means any attorney or firm of attorneys whose
experience in matters relating to the issuance of obligations by
states and their political subdivisions is nationally recognized
and reasonably acceptable to the Lessor.
"Business Day" means a day on which banks located in New
York City are not required or authorized to remain closed and on
which the New York Stock Exchange is not closed.
"Closing Date" means the date of the execution and delivery
by the Lessee of the Deed to Lessor.
"Code" means the Internal Revenue Code of 1986, as amended
and regulations of the Department of Treasury promulgated
thereunder and under the Internal Revenue Code of 1954, as
amended.
"Completion Date" means the date which is certified as the
date of completion of the construction of the Facility and
installation of the Equipment pursuant to Section 4.2 of the
Lease Agreement.
"Construction Period" means the period (A) beginning on the
date of commencement of construction of the Facility, and (B)
ending on the Completion Date.
"Deed to the Lessee" means the deed from the Lessor to the
Lessee (substantially in the form shown in Exhibit "B" to the
Lease Agreement) to be delivered to the Lessee upon satisfaction
of the conditions set forth in the Lease Agreement.
"Deed to the Lessor" means the deed from the Lessee to the
Lessor conveying the Lessee's fee interest in the Land and the
Facility.
"Equipment" means all items of machinery, equipment,
fixtures and/or furnishings installed into the Facility during
the Construction Period.
"Event of Default" means any of those events defined as
Events of Default by the terms of any of the Leasing Documents.
"Facility" means, all those buildings, improvements,
structures and other related facilities affixed or attached to or
to be affixed or attached to the Land, all as they may exist from
time to time.
"Governmental Authority" means the United States, the State
and any political subdivision thereof, and any agency,
department, commission, board, bureau or instrumentality of any
of them.
"Land" means the real property described in Exhibit "A" to
the Lease Agreement.
"Lease Agreement" means the lease agreement dated as of
September 1, 1996 by and between the Lessor and the Lessee, as
said lease agreement may be amended or supplemented from time to
time
"Lease" or "Leases" means any agreements of lease or
sublease with respect to all or portions of the Project Facility,
as said agreements of lease or sublease may have been or may from
time to time be hereinafter modified, extended and revised
including but not limited to, the Lease Agreement, and any future
lease or sublease affecting any portion of the Project Facility.
"Leasing Documents" means this Lease Agreement, the PILOT
Agreement and any other document now or hereafter executed by the
Lessor and the Lessee in connection with the Project Facility.
"Lessor" means (A) the County of Saratoga Industrial
Development Agency and its successors and assigns, and (B) any
public benefit corporation or other public corporation resulting
from or surviving any consolidation or merger to which the County
of Saratoga Industrial Development Agency or its successors or
assigns may be a party.
"Lessee" means Ace Hardware Corporation, a Delaware
corporation having an address of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, and its successors and permitted
assigns.
"Lien" means any interest in Property securing an obligation
owed to a Person whether such interest is based on the common
law, statute or contract, and including but not limited to a
security interest arising from a mortgage, encumbrance, pledge,
conditional sale or trust receipt or a lease, consignment or
bailment for security purposes. The term "Lien" includes
reservations, exceptions, encroachments, easements, rights of
way, covenants, conditions, restrictions, leases and other
similar title exceptions and encumbrances, including but not
limited to mechanics', materialmen's warehousemen's and carriers'
liens and other similar encumbrances, affecting real property.
For the purposes hereof, a Person shall be deemed to be the owner
of Property which it has acquired or holds subject to a
conditional sale agreement or other arrangement pursuant to which
title to the Property has been retained by or vested in some
other Person for security purposes.
"Lien Law" means the Lien Law of the State.
"Local Authority" means any Governmental Authority which
exercises jurisdiction over the Project Facility.
"Local Requirement" means any law, ordinance, order, rule or
regulation of a Governmental Authority or a Local Authority,
respectively.
"Permitted Encumbrances" means and includes with respect to
the Lessee and its Subsidiaries (if any): (i) in the case of real
properties, easements, restrictions, exceptions, reservations or
defects which, in the aggregate, do not interfere with the
continued use of such properties for the purposes for which they
are used and do not affect the value thereof; (ii) liens, if
contested in good faith by appropriate proceedings as allowed
pursuant to Section 8.6 of the Lease Agreement; (iii) pledges or
deposits to secure obligations under worker's compensation laws
or similar legislation or to secure performance in connection
with bids, tenders and contracts in the ordinary course of the
Lessee's business (other than contracts for the payment of
borrowed money) to which the Lessee or any Subsidiary of the
Lessee is a party; (iv) deposits to secure public or statutory
obligations of the Lessee and any Subsidiary of the Lessee; (v)
carriers' or other like liens arising in the ordinary course of
business, or deposits of cash or United States obligations to
obtain the release of such liens or of mechanics' or worker's
liens; (vi) deposits to secure surety or appeal bonds in
proceedings to which the Lessee or any Subsidiary of the Lessee
is a party; (vii) existing leases by the Lessee of real and
personal property; (viii) liens arising out of or created by the
Leasing Documents; and (ix) such other encumbrances as may be
consented to, from time to time, by the Lessor and the Lessee.
"Person" shall mean any legal entity, including without
limitation an individual, a corporation, a company, a voluntary
association, a partnership, a trust, an unincorporated
organization or a government, or any agency, instrumentality or
political subdivision thereof.
"PILOT Agreement" means the payment in lieu of tax agreement
dated as of September 1, 1996 by and between the Lessor and the
Lessee, as said payment in lieu of tax agreement may be amended
or supplemented from time to time.
"Project" means that project undertaken by the Lessor
consisting of (A) the acquisition of the Land, (B) the
construction of the Facility and (C) the acquisition and
installation of the Equipment.
"Project Facility" means, collectively, the Land, the
Facility and the Equipment.
"Property" means any interest in any kind of property or
asset, whether real, personal or mixed, or tangible or
intangible.
"Requirement" means any law, ordinance, order, rule or
regulation of a Governmental Authority or a Local Authority,
respectively.
"Resolution" means the resolution duly adopted by the Lessor
on September 16, 1996 authorizing the execution and delivery of
the Leasing Documents to which the Lessor is a party.
"State" means the State of New York.
SECTION 1.2. INTERPRETATION. In this Lease Agreement, unless
the context otherwise requires:
(A) the terms "hereby", "hereof", "herein", "hereunder" and
any similar terms as used in this Lease Agreement refer to this
Lease Agreement, and the term "heretofore" shall mean before, and
the term "hereafter" shall mean after, the date of this Lease
Agreement;
(B) words of masculine gender shall mean and include
correlative words of feminine and neuter genders and words
importing the singular number shall mean and include the plural
number and vice versa; and
(C) any certificates, letters or opinions required to be
given pursuant to this Lease Agreement shall mean a signed
document attesting to or acknowledging the circumstances,
representations, opinions of law or other matters therein stated
or set forth or setting forth matters to be determined pursuant
to this Lease Agreement.
ARTICLE II
REPRESENTATIONS, WARRANTIES
AND COVENANTS
SECTION 2.1. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
LESSOR. The Lessor makes the following representations,
warranties and covenants as the basis for the undertakings on its
part herein contained:
(A) The Lessor is duly established under the provisions of
the Act and has the power to enter into this Lease Agreement and
to carry out its obligations hereunder. Based upon the
representations of the Lessee as to the utilization of the
Project Facility, the Project Facility constitutes and will
constitute a "project" as such quoted term is defined in the Act.
By proper official action the Lessor has been duly authorized to
execute, deliver and perform this Lease Agreement and the other
Leasing Documents to which it is a party.
(B) Neither the execution and delivery of this Lease
Agreement, the consummation of the transactions contemplated
hereby nor the fulfillment of or compliance with the provisions
of the other Leasing Documents by the Lessor will conflict with
or result in a breach by the Lessor of any of the terms,
conditions or provisions of the Act, the by-laws of the Lessor or
any order, judgment, restriction, agreement or instrument to
which the Lessor is a party or by which it is bound, or will
constitute a default by the Lessor under any of the foregoing.
(C) The Lessor will cause the Project Facility to be
constructed and will lease the Project Facility to the Lessee
pursuant to this Lease Agreement, all for the purpose of
advancing the job opportunities, health, general prosperity and
economic welfare of the people of the State and improving their
standard of living.
(D) Except as provided herein and in Article IX and Article
X hereof, the Lessor, to the extent of its interest therein,
shall not sell, assign, transfer, encumber or pledge as security
the Project Facility or any part thereof.
SECTION 2.2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF
THE LESSEE. The Lessee makes the following representations,
warranties and covenants as the basis for the undertakings on its
part herein contained:
(A) The Lessee is a corporation organized, existing and in
good standing under the laws of the State of Delaware, is
qualified to do business within the State, has power to enter
into this Lease Agreement and the other Leasing Documents to
which it is a party and to carry out its obligations hereunder
and thereunder, has been duly authorized to execute this Lease
Agreement and the other Leasing Documents to which the Lessee is
a party. This Lease Agreement and the other Leasing Documents to
which the Lessee is a party and the transactions contemplated
hereby and thereby have been duly authorized by all necessary
corporate action.
(B) Neither the execution and delivery of this Lease
Agreement or the other Leasing Documents to which the Lessee is a
party, the consummation of the transactions contemplated hereby
or thereby, nor the fulfillment of or compliance with the
provisions of this Lease Agreement or the other Leasing Documents
to which the Lessee is a party will (1) result in a breach of or
conflict with any of the terms, conditions or provisions of the
Lessee's certificate of incorporation or by-laws or any
agreement, instrument, order or judgment to which the Lessee is a
party or by which the Lessee is bound, or will constitute a
default under any of the foregoing, or result in the creation or
imposition of any Lien of any nature upon the Project Facility
under the terms of any such instrument or agreement, other than
the Permitted Encumbrances, (2) require consent under (which has
not been heretofore received) or result in a breach of or default
under any credit agreement, indenture, purchase agreement,
mortgage, deed of trust, commitment, guaranty or other agreement
or instrument to which the Lessee is a party or by which it or
any of its Property may be bound or affected, or (3) conflict
with or violate any existing law, rule, regulation, judgment,
order, writ, injunction or decree of any government, governmental
instrumentality or court (domestic or foreign), having
jurisdiction over the Lessee or any of the Property of the
Lessee.
(C) The acquisition and construction of the Project
Facility will not result in the removal of a facility or plant of
the Lessee or any contemplated occupant of the Project Facility
from one area of the State to another area of the State or in the
abandonment of one or more plants or facilities of the Lessee or
any contemplated occupant of the Project Facility located within
the State, except to the extent to which such relocation or
abandonment is reasonably necessary to discourage the Lessee or
any Project occupant from removing a facility or plant of the
Lessee or any Project occupant to a location outside the State of
New York or is reasonably necessary to preserve the competitive
position of the Lessee or any Project occupant in its respective
industry.
(D) The Leasing Documents to which it is a party
constitute, or upon their execution and delivery in accordance
with the terms thereof will constitute, valid and legally binding
obligations of the Lessee, enforceable in accordance with their
respective terms.
(E) So long as the PILOT Agreement shall be outstanding,
the Project Facility is and will continue to be a "project" as
such quoted term is defined in the Act, and the Lessee will not
take any action (or omit to take any action required by the
Leasing Documents or which the Lessor, advises the Lessee in
writing should be taken), or allow any action to be taken, which
action (or omission) would in any way (1) cause the Project
Facility not to constitute a "project" as such quoted term is
defined in the Act.
(F) The Lessee shall cause all notices required by law to
be given, and shall comply or cause compliance with all laws,
ordinances, municipal rules and regulations and requirements of
all Governmental Authorities applying to or affecting the conduct
of work on the Project Facility, and the Lessee will defend and
save the Lessor and its officers, members, agents and employees
harmless from all fines and penalties due to failure to comply
therewith.
(G) The acquisition and construction of the Project
Facility will not have a significant impact on the environment
within the terms of SEQRA and the statewide and local regulations
thereunder. The Lessee hereby covenants to comply with all
mitigation measures, requirements and conditions, if any,
enumerated in the negative declaration issued by the Wilton
Planning Board under SEQRA with respect to the Project Facility
and in any other approvals issued by any other Governmental
Authority.
(H) The Project Facility and the operation thereof complies
and will comply with all applicable building, zoning,
environmental, planning and subdivision laws, ordinances, rules
and regulations of Governmental Authorities having jurisdiction
over the Project Facility.
(I) The Lessee shall (1) cause any new employment
opportunities created in connection with the Project to be listed
with (i) the Regional Office of the New York State Department of
Economic Development serving Wilton, New York, (ii) the New York
State Department of Labor Jobs Service Division, and (iii) the
local service delivery area administrative entity created
pursuant to the United States Job Training Partnership Act (P.L.
97-300) serving Wilton, New York, (2) the Lessee shall file with
the Lessor on or before January 1 of each year during which the
Lease Agreement remains in effect the status of its employment
plan with respect to the Project, including the number of
employment opportunities created, the number of employment
openings listed in accordance with (i) above and the number of
employment positions filled, and (3) the Lessee agrees, subject
to the terms of any existing collective bargaining agreement(s),
to first consider for such new employment persons eligible under
the United States Job Training Partnership Act.
(J) The Lessee shall deliver to the Lessor a notice, within
five (5) days of its occurrence, or as soon thereafter as the
Lessee becomes aware of, or should have become aware of, the
same, any Event of Default, material litigation or failure to
observe any covenant in the Financing Documents.
(K) Not more than one-third of the total Cost of the
Project shall be used to provide facilities primarily used in
making Retail Sales (as such term is defined in Section 862 of
the General Municipal Law of the State) to customers who
personally visit such facilities.
ARTICLE III
CONVEYANCE AND USE OF
PROJECT FACILITY
SECTION 3.1. CONVEYANCE TO THE LESSOR. The Lessee has conveyed
or will convey, or will cause to be conveyed, all of its right,
title and interest in and to the Project Facility to the Lessor
pursuant to the Deed to Lessor. The Lessee hereby represents and
warrants that it has good and marketable title to the Project
Facility, free and clear of all Liens except for Permitted
Encumbrances and agrees that it will defend, indemnify and hold
the Lessor harmless from any expense or liability due to any
defect in title thereto. The Lessee shall pay all (i) costs,
expenses, taxes and charges incurred in connection with such
conveyance and transfer, including, without limitation, the cost
of recording of the warranty deed in the Saratoga County Clerk's
Office and (ii) taxes, assessments and other charges and
impositions of the Project Facility attributable to periods prior
to the date of this Lease Agreement.
SECTION 3.2. USE OF PROJECT FACILITY. Subsequent to the Closing
Date, the Lessee shall be entitled to use the Project Facility in
any manner not otherwise prohibited by the Leasing Documents,
provided that such use (1) causes the Project Facility to qualify
or continue to qualify as a "project" under the Act and (2) does
not tend, in the reasonable judgment of the Lessor, to bring the
Project Facility into disrepute as a public project.
ARTICLE IV
ACQUISITION OF LAND; CONSTRUCTION OF FACILITY;
ACQUISITION AND INSTALLATION OF EQUIPMENT
SECTION 4.1. ACQUISITION OF LAND; CONSTRUCTION OF FACILITY;
ACQUISITION AND INSTALLATION OF EQUIPMENT. (A) The Lessee shall,
on behalf of the Lessor, promptly (1) acquire the Land, (2)
construct the Facility or cause the Facility to be constructed
and (3) acquire and install the Equipment or cause the Equipment
to be acquired and installed.
(B) The Lessor shall enter into, and accept the assignment
of, such contracts as the Lessee may request in order to
effectuate the purposes of this Section 4.1; provided, however,
that the Lessor shall have no liability under such contracts.
(C) The Lessor hereby appoints the Lessee its true and
lawful agent during the Construction Period to perform under the
following authority in compliance with the terms, purposes and
intent of the Leasing Documents, and the Lessee hereby accepts
such agency: (1) to acquire the Land, construct the Facility and
acquire and install the Equipment, (2) to make, execute,
acknowledge and deliver any contracts, orders, receipts, writings
and instructions with any other Persons, and in general to do all
things which may be requisite or proper, all for the acquisition,
construction and installation of the Project Facility, with the
same powers and with the same validity as the Lessor could do if
acting in its own behalf, provided that the Lessor shall have no
liability under such contracts, orders, receipts, writings and
instructions, (3) to pay all fees, costs and expenses incurred in
the acquisition, construction and installation of the Project
Facility and (4) to ask, demand, ▇▇▇ for, ▇▇▇▇, recover and
receive all such sums of money, debts, dues and other demands
whatsoever which may be due, owing and payable to the Lessor
under the terms of any contract, order, receipt or writing in
connection with the acquisition and construction of the Project
Facility and to enforce the provisions of any contract,
agreement, obligation, bond or other performance security in
connection with the same.
(D) The Lessee has given or will give or cause to be given
all notices and has complied or will comply or cause compliance
with all laws, ordinances, rules, regulations and requirements of
all Governmental Authorities applying to or affecting the conduct
of work on the Project Facility, and the Lessee will defend,
indemnify and save the Lessor and its officers, members, agents,
servants and employees harmless from all fines and penalties due
to failure to comply therewith. All permits and licenses
necessary for the prosecution of work on the Project Facility
shall be procured promptly by the Lessee.
(E) To the extent required by applicable law, the Lessee,
as agent for the Lessor, will cause (1) compliance with the
requirements of Article 8 of the Labor Law of the State, and (2)
any contractor, subcontractors and other Persons involved in the
acquisition, construction and installation of the Project
Facility to comply with Article 8 of the Labor Law of the State.
The covenant in this subsection is not intended as a
representation that Article 8 of the Labor Law of the State
applies.
(F) The Lessee agrees to file with the Department of
Taxation and Finance of the State in a manner and at the time
prescribed thereby, information relating to the extent of
exemption from sales and use tax claimed with respect to the
construction of the Project Facility all in compliance with
Section 874 of the General Municipal Law of the State. THE
LESSEE ACKNOWLEDGES THAT THE FAILURE TO COMPLY WITH THE
PROVISIONS OF SAID SECTION 874 SHALL RESULT IN A REVOCATION OF
THE AUTHORITY GRANTED PURSUANT TO SUBSECTION (C) OF THIS SECTION
4.1.
SECTION 4.2. COMPLETION OF PROJECT FACILITY. The Lessee will
proceed with due diligence to complete the acquisition of the
Land, the construction of the Facility and the installation of
the Equipment. Completion of the same shall be evidenced by a
certificate signed by an Authorized Representative of the Lessee
delivered to the Lessor stating (A) the date of such completion,
(B) that all labor, services, materials and supplies used
therefor and all costs and expenses in connection therewith have
been or will be paid, (C) that the acquisition of the Land, the
construction of the Facility and the installation of the
Equipment have been completed with the exception of ordinary
punchlist items and work awaiting seasonal opportunity, (D) that
the Lessee or the Lessor has good and valid title to all Property
constituting a portion of the Project Facility, and that the
Project Facility is subject to this Lease Agreement and (E) that
the Project Facility is ready for occupancy, use and operation
for its intended purposes. Notwithstanding the foregoing, such
certificate may state (1) that it is given without prejudice to
any rights of the Lessee against third parties which exist at the
date of such certificate or which may subsequently come into
being, (2) that it is given only for the purposes of this Section
4.2, and (3) that no Person other than the Lessor may benefit
therefrom. Such certificate shall be accompanied by a
certificate of occupancy, if required, any and all permissions,
licenses or consents required of Governmental Authorities for the
occupancy, operation and use of the Project Facility for its
intended purposes.
SECTION 4.3. REMEDIES TO BE PURSUED AGAINST CONTRACTORS,
SUBCONTRACTORS, MATERIALMEN AND THEIR SURETIES. In the event of
a material default by any contractor, subcontractor or
materialman under any contract made by it in connection with the
construction of the Facility or in the event of a breach of
warranty or other liability with respect to any materials,
workmanship or performance guaranty, the Lessee may proceed,
either separately or in conjunction with others, to exhaust the
remedies of the Lessee and the Lessor against the contractor,
subcontractor or materialman so in default and against each
surety for the performance of such contract. The Lessee may, in
its own name or, with the prior written consent of the Lessor, in
the name of the Lessor, prosecute or defend any action or
proceeding or take any other action involving any such
contractor, subcontractor, materialman or surety which the Lessee
deems reasonably necessary, and in such event the Lessor hereby
agrees, at the Lessee's sole expense, to cooperate fully with the
Lessee and to take all action necessary to effect the
substitution of the Lessee for the Lessor in any such action or
proceeding. The Lessee shall immediately advise the Lessor of
any actions or proceedings taken hereunder.
ARTICLE V
LEASE OF PROJECT FACILITY; RENT;
CONVEYANCE OF PROJECT FACILITY
SECTION 5.1. LEASE OF PROJECT FACILITY. The Lessor hereby
leases the Project Facility to the Lessee, and the Lessee hereby
leases the Project Facility from the Lessor, for and during the
term hereinafter provided and upon and subject to the terms and
conditions hereinafter set forth. The Lessee assumes and agrees
to perform and discharge all of the Lessor's obligations under
the Lease Documents during the Lease Term, and shall enforce all
claims arising under any representation, warranty, covenant,
indemnity, guarantee or agreement in the Lease Documents.
SECTION 5.2. DURATION OF TERM. The term of this Lease Agreement
shall become effective upon its delivery and shall expire on
September 1, 2007, or such earlier date as this Lease Agreement
may be terminated as hereinafter provided. The Lessor shall
deliver to the Lessee and the Lessee shall accept sole and
exclusive possession of the Project Facility simultaneously with
the execution of this Lease Agreement.
SECTION 5.3. QUIET ENJOYMENT. So long as no Event of Default
shall have occurred and be continuing, and except as otherwise
expressly provided herein or in the Leasing Documents, the Lessor
will not disturb the Lessee in its peaceful and quiet enjoyment
of the Project Facility, which shall be free from any
interference, repossession or disturbance by the Lessor.
SECTION 5.4. RENT AND OTHER AMOUNTS PAYABLE. (A) The Lessee
shall pay rent for the Project Facility as follows:
(A) On the Closing Date, the Lessee shall pay to the Lessor
the agreed upon administrative fee of the Lessor in an amount not
to exceed $161,125.00.
(B) Within seven (7) days after receipt of a demand
therefor from the Lessor, the Lessee shall pay to the Lessor the
sum of the reasonable expenses of the Lessor and the officers,
members, agents and employees thereof incurred by reason of the
Lessor's ownership or lease of the Project Facility or in
connection with the carrying out of the Lessor's duties and
obligations under this Lease Agreement or any of the other
Leasing Documents and any other fee or expense of the Lessor,
including reasonable attorneys' fees, with respect to the Project
Facility, the sale of the Project Facility to the Lessee, any of
the other Leasing Documents, the payment of which is not
otherwise provided for under this Lease Agreement.
(C) The Lessee agrees to make the above mentioned payments,
without any further notice, in lawful money of the United States
of America as, at the time of payment, shall be legal tender for
the payment of public and private debts. In the event the Lessee
shall fail to make any payment required by this Section 5.4 for a
period of more than thirty (30) days from the date such payment
is due, the Lessee shall pay the same together with interest
thereon at the Default Rate or the maximum permitted by law,
whichever is less, from the date on which such payment was due
until the date on which such payment is made.
SECTION 5.5. NATURE OF OBLIGATIONS OF THE LESSEE HEREUNDER. The
obligations of the Lessee to make the payments required by this
Lease Agreement and to perform and observe any and all of the
other covenants and agreements on its part contained herein shall
be general obligations of the Lessee and shall be absolute and
unconditional irrespective of any defense or any rights of set-
off, recoupment or counterclaim the Lessee may otherwise have
against the Lessor. The Lessee agrees that it will not suspend,
discontinue or ▇▇▇▇▇ any payment required by, or fail to observe
any of its other covenants or agreements contained in this Lease
Agreement, or terminate this Lease Agreement for any cause
whatsoever, including, without limiting the generality of the
foregoing, failure to complete the acquisition of the Land, the
construction of the Facility or the acquisition and installation
of the Equipment, any material defect in the title, design,
operation, merchantability, fitness or condition of the Project
Facility or any part thereof or in the suitability of the Project
Facility or any part thereof for the Lessee's purposes or needs,
failure of consideration for, destruction of or damage to,
Condemnation of title to or the use of all or any part of the
Project Facility, any change in the tax or other laws of the
United States of America or of the State or any political
subdivision thereof, or any failure of the Lessor to perform and
observe any agreement, whether expressed or implied, or any duty,
liability or obligation arising out of or in connection with this
Lease Agreement.
ARTICLE VI
MAINTENANCE, MODIFICATIONS, TAXES AND INSURANCE
SECTION 6.1. MAINTENANCE AND MODIFICATIONS OF PROJECT FACILITY.
The Lessee agrees that during the period that the Lease Agreement
is outstanding it will (1) keep the Project Facility in good
condition and repair and preserve the same against waste, loss,
damage and depreciation, ordinary wear and tear excepted, (2)
make all necessary repairs and replacements to the Project
Facility or any part thereof (whether ordinary or extraordinary,
structural or nonstructural, foreseen or unforeseen), and (3)
operate the Project Facility in a sound and economic manner.
SECTION 6.2. TAXES, ASSESSMENTS AND UTILITY CHARGES. The Lessee
shall pay or cause to be paid, as the same respectively become
due, (1) all taxes and governmental charges of any kind
whatsoever which may at any time be lawfully assessed or levied
against or with respect to the Project Facility, (2) all utility
and other charges, including "service charges", incurred or
imposed for the operation, maintenance, use, occupancy, upkeep
and improvement of the Project Facility, (3) all assessments and
charges of any kind whatsoever lawfully made by any Governmental
Authority for public improvements, and (4) all payments required
under Section 6.6 hereof; provided that, with respect to special
assessments or other governmental charges that may lawfully be
paid in installments over a period of years, the Lessee shall be
obligated hereunder to pay only such installments as are required
to be paid during all periods that sums payable by the Lessee
hereunder or under any of the other Leasing Documents are due
and owing.
SECTION 6.3. INSURANCE REQUIRED. At all times that the Lessor
is the owner of the Project Facility, the Lessee shall maintain
or, with respect to the insurance required by subsection (D) of
this Section 6.3, cause the general contractor to maintain
insurance with respect to the Project Facility against such risks
and for such amounts as are customarily insured against by
businesses of like size and type, paying, as the same become due
and payable, all premiums with respect thereto, including, but
not necessarily limited to:
(A) (1) Insurance protecting the interests of the Lessee
as insured against loss or damage to the Project Facility by
fire, lightning, vandalism, malicious mischief and other perils
and casualties normally insured against with a uniform extended
coverage endorsement, such insurance at all times to be in an
amount consistent with applicable commercial standards.
(B) To the extent applicable, workers' compensation
insurance, disability benefits insurance and such other forms of
insurance which the Lessee is required by law to provide,
covering loss resulting from injury, sickness, disability or
death of employees of the Lessee who are located at or assigned
to the Project Facility or who are responsible for the
construction of the Facility, including, but not limited to, all
contractors and subcontractors.
(C) Insurance protecting the Lessee and the Lessor against
loss or losses from liabilities imposed by law or assumed in any
written contract (including, without limitation, the contractual
liability assumed by the Lessee under Section 8.2 of this Lease
Agreement) and arising from personal injury or death or damage to
the property of others caused by any accident or occurrence, with
limits of not less than $1,000,000 per person per accident or
occurrence on account of personal injury, including death
resulting therefrom, and $1,000,000 per accident or occurrence on
account of damage to the property of others, excluding liability
imposed upon the Lessee by any applicable workers' compensation
law, and a separate commercial umbrella liability policy in
excess of the basic coverage stated above protecting the Lessee
and the Lessor with a limit of not less than $5,000,000.
(D) During any construction period, the general contractor
and any subcontractor constructing and equipping the Project
Facility shall be required to carry workers' compensation and
general comprehensive liability insurance containing coverages
for premises operations, products and completed operations,
explosion, collapse and underground damage hazard, contractor's
protective, owner's protective and coverage for all owned, non-
owned and hired vehicles with non-ownership protection from the
general contractor or subcontractor's employees providing the
following minimum limits:
(a) Workers' compensation and employer's liability - in
accordance with applicable law, covering loss resulting from
injury, sickness, disability and death of employees located at or
assigned to the Facility or who are responsible for the
construction of the Facility.
(b) Comprehensive general liability:
(i) Bodily injury liability in an amount not less than
$1,000,000 for each accident and not less than $5,000,000 for
injuries sustained by two or more persons in any one accident.
(ii) Property damage liability in an amount not less
than $1,000,000 for each accident and not less than $5,000,000 in
the aggregate for each year of the policy period.
(c) Comprehensive automobile liability:
(i) Bodily injury liability in an amount not less than
$1,000,000 for each accident and not less than $5,000,000 for
injuries sustained by two or more persons in any one accident.
(E) Other insurance coverage required by any Governmental
Authority in connection with any Requirement.
(F) THE LESSOR DOES NOT IN ANY WAY REPRESENT OR WARRANT
THAT THE INSURANCE SPECIFIED HEREIN, WHETHER IN SCOPE OR IN
LIMITS OF COVERAGE, IS ADEQUATE OR SUFFICIENT TO PROTECT THE
LESSEE'S BUSINESS OR INTERESTS.
SECTION 6.4. ADDITIONAL PROVISIONS RESPECTING INSURANCE. All
insurance required by Section 6.3 hereof shall be procured and
maintained in financially sound and generally recognized
responsible insurance companies selected by the Lessee and
authorized to write such insurance in the State and satisfactory
to the Lessor. The company or companies issuing the policies
required by Sections 6.3(C) shall be rated "A" or better by A.M.
Best Co., Inc. in the most recent edition of Best's Key Rating
Guide. Such insurance may be written with deductible amounts
comparable to those on similar policies carried by other
companies engaged in businesses similar in size, character and
other respects to those in which the Lessee is engaged. All
policies evidencing such insurance shall name the Lessee and the
Lessor as insureds, as their interests may appear, and provide
for at least thirty (30) days' written notice to the Lessee and
the Lessor prior to cancellation, lapse, reduction in policy
limits or material change in coverage thereof. The insurance
required by Sections 6.3(A), 6.3(C), 6.3(D) and 6.3(F) hereof
shall be fully paid for. All insurance required hereunder shall
be in form, content and coverage satisfactory to the Lessor.
Certificates satisfactory in form and substance to the Lessor to
evidence all insurance required hereby shall be delivered to the
Lessor on or before the Closing Date. The Lessee shall deliver
to the Lessor on or before the first Business Day of each
calendar year thereafter a certificate dated not earlier than the
immediately preceding December 1 reciting that there is in full
force and effect, with a term covering at least the next
succeeding calendar year, insurance in the amounts and of the
types required by Sections 6.3 and 6.4 hereof. At least thirty
(30) days prior to the expiration of any such policy, the Lessee
shall furnish to the Lessor evidence that the policy has been
renewed or replaced or is no longer required by this Lease
Agreement. In addition, in the event of a change of use,
operation or value of the Project Facility, or in the
availability of insurance in the area in which the Project
Facility is located, the Lessee shall, within five (5) days after
the Lessor's request, take out such additional insurance as the
Lessor may reasonably require.
(B) All premiums with respect to the insurance required by
Section 6.3 hereof shall be paid by the Lessee; provided,
however, that if the premiums are not timely paid, the Lessor may
pay such premiums and the Lessee shall pay immediately upon
demand all sums so expended by the Lessor, together with
interest, to the extent permitted by law, at the Default Rate
from the date on which such payment was due until the date on
which the payment is made.
(C) (1) The Lessee shall not take out separate insurance
concurrent in form or contributing in the event of loss with that
required to be maintained under Section 6.3 unless the Lessor is
included therein as a named insured. The Lessee shall
immediately notify the Lessor whenever any such separate
insurance is taken out and shall promptly deliver to the Lessor
the policy or policies of such insurance.
(2) Each of the policies required pursuant to Section 6.3
hereof shall waive any right of subrogation against any Person
insured under such policy, and shall waive any right of the
insurers to any set-off or counterclaim or any other deduction,
whether by attachment or otherwise, in respect of any liability
of any Person insured under such policy.
SECTION 6.5. APPLICATION OF NET PROCEEDS OF INSURANCE. The Net
Proceeds of the insurance carried pursuant to the provisions of
Section 6.3 hereof shall be applied as follows: (A) the Net
Proceeds of the insurance required by Section 6.3(A) hereof shall
be paid to the Lessee and applied as provided in Section 7.1
hereof, (B) the Net Proceeds of the insurance required by Section
6.3(B), 6.3(C), 6.3(D) and 6.3(E) hereof shall be applied toward
extinguishment or satisfaction of the liability with respect to
which such insurance proceeds may be paid.
SECTION 6.6. PAYMENTS IN LIEU OF TAXES. (A) It is recognized
that, under the provisions of the Act, the Lessor is required to
pay no taxes or assessments upon any of the property acquired by
it or under its jurisdiction, control or supervision or upon its
activities. It is not the intention, however, of the parties
hereto that the Project Facility be treated as exempt from real
property taxation. Accordingly, the parties acknowledge that a
Payment In Lieu of Tax Agreement (the "PILOT Agreement") has been
executed with respect to the Project Facility. Until the
expiration date of the PILOT Agreement, the Lessor and the Lessee
hereby agree that the Lessee (or any subsequent user of the
Project Facility under this Lease Agreement) shall be required to
make or cause to be made payments in lieu of real estate taxes in
the amounts and in the manner set forth in the PILOT Agreement.
(B) In the event that (1) the Project Facility would be
subject to real property taxation if owned by the Lessee but
shall be deemed exempt from real property taxation due to the
involvement of the Lessor therewith, and (2) the PILOT Agreement
shall not have been entered into by the Lessor and the Lessee,
or, if entered into, the PILOT Agreement shall for any reason no
longer be in effect, the Lessor and the Lessee hereby agree that
the Lessee, or any subsequent user of the Project Facility under
this Lease Agreement, shall in such event be required to make or
cause to be made payments in lieu of taxes to the school district
or school districts, city, town, county, village and other
political units wherein the Project Facility is located having
taxing powers (such political units are hereinafter collectively
referred to as the "Taxing Entities") in such amounts as would
result from taxes being levied on the Project Facility by the
Taxing Entities if the Project Facility were privately owned by
the Lessee and not deemed owned by or under the jurisdiction,
control or supervision of the Lessor, but with appropriate
reductions similar to the real property tax exemptions and
credits, if any, which would be afforded to the Lessee if it were
the owner of the Project Facility. It is agreed that the Lessee,
in cooperation with the Lessor, (a) shall cause the Project
Facility to be valued for purposes of determining the amounts due
hereunder as if owned by the Lessee as aforesaid by the
appropriate officer or officers of any of the Taxing Entities as
may from time to time be charged with responsibility for making
such valuations, (b) shall cause to be appropriately applied to
the valuation or valuations so determined the respective tax rate
or rates of the Taxing Entities that would be applicable to the
Project Facility if so privately owned, (c) shall cause the
appropriate officer or officers of the Taxing Entities charged
with the duty of levying and collecting such taxes to submit to
the Lessee, when the respective levies are made for purposes of
such taxes upon Property privately owned as aforesaid, statements
specifying the amounts and due dates of such taxes which the
Taxing Entities would receive if such Property were so privately
owned by the Lessee and not deemed owned by or under the
jurisdiction, control or supervision of the Lessor, and (d) shall
file with the appropriate officer or officers any accounts or tax
returns furnished to the Lessor by the Lessee for the purpose of
such filing.
(C) The Lessee shall pay or cause to be paid to the Taxing
Entities when due all such payments in lieu of taxes with respect
to the Project Facility required by Section 6.6(B) of this Lease
Agreement to be paid to the Taxing Entities, subject in each case
to the Lessee's right to (a) obtain exemptions and credits, if
any, which would be afforded to a private owner of the Project
Facility, including any available exemption under Section 485-b
of the New York Real Property Tax Law with respect to the Project
Facility, (b) contest valuations of the Project Facility made for
the purpose of determining such payments therefrom (provided,
however, no such contest shall entitle the Lessee to defer
payments in lieu of taxes by reason of any such contest), and (c)
seek to obtain a refund of any such payments made. In the event
the Lessee shall fail to make or cause to be made any such
payments in lieu of taxes, the amount or amounts so in default
shall continue as an obligation of the Lessee until fully paid,
and the Lessee hereby agrees to pay or cause to be paid the same,
together with late charges and interest thereon as provided for
in subsection (5) of Section 874 of the General Municipal Law of
the State (or any successor provision).
ARTICLE VII
DAMAGE, DESTRUCTION AND CONDEMNATION
SECTION 7.1. DAMAGE OR DESTRUCTION. If the Project Facility
shall be damaged or destroyed, in whole or in part, the Lessee
shall give the Lessor prompt written notice thereof. As between
the Lessor and the Lessee, the Lessee shall have sole right to
and control over the use of the Net Proceeds of any insurance
settlement. The Lessee shall not be obligated to replace,
repair, rebuild or restore the Project Facility, and the Net
Proceeds of any insurance settlement shall not be applied to
replace, repair, rebuild or restore the Project Facility if the
Lessee shall notify the Lessor that, in the Lessee's sole
judgment, the Lessee does not deem it practical or desirable to
so replace, repair, rebuild or restore the Project Facility. The
Lessor shall have no obligation to rebuild or restore the Project
Facility, and upon payment of all payments due pursuant to
Section 5.4 hereof, the Lease Term shall end and the obligations
of the Lessee hereunder (other than any such obligations
expressed herein as surviving termination of this Lease
Agreement) shall terminate as of the date of such payment and the
Lessor shall transfer to the Lessee, without recourse or
warranty, all right, title and interest of the Lessor in and to
the Project Facility.
SECTION 7.2. CONDEMNATION. If title to, or the use of, the
Project Facility shall be taken by Condemnation, the Lessee shall
give the Lessor prompt written notice thereof. As between the
Lessor and the Lessee, the Lessee shall have sole right to and
control over the use of the Net Proceeds of any insurance
settlement. The Net Proceeds of any Condemnation award shall not
be applied to restore the Project Facility if the Lessee shall
notify the Lessor that, in the Lessee's sole judgment, the Lessee
does not deem it practical or desirable to restore the Project
Facility. The Lessor shall have no obligation to restore the
Project Facility, and upon payment of all payments due pursuant
to Section 5.4 hereof, the Lease Term shall end and the
obligations of the Lessee hereunder (other than any such
obligations expressed herein as surviving termination of this
Lease Agreement) shall terminate as of the date of such payment
and the Lessor shall transfer to the Lessee, without recourse or
warranty, all right, title and interest of the Lessor in and to
the Project Facility.
ARTICLE VIII
SPECIAL COVENANTS
SECTION 8.1. NO WARRANTY OF CONDITION OR SUITABILITY BY LESSOR;
ACCEPTANCE "AS IS". THE LESSOR MAKES NO WARRANTY, EITHER EXPRESS
OR IMPLIED, AS TO THE CONDITION, TITLE, DESIGN, OPERATION,
MERCHANTABILITY OR FITNESS OF THE PROJECT FACILITY OR ANY PART
THEREOF OR AS TO THE SUITABILITY OF THE PROJECT FACILITY OR ANY
PART THEREOF FOR THE LESSEE'S PURPOSES OR NEEDS. THE LESSEE
SHALL ACCEPT TITLE TO THE PROJECT FACILITY "AS IS", WITHOUT
RECOURSE OF ANY NATURE AGAINST THE LESSOR FOR ANY CONDITION NOW,
HERETOFORE OR HEREAFTER EXISTING. NO WARRANTIES OF FITNESS FOR A
PARTICULAR PURPOSE OR MERCHANTABILITY ARE MADE. IN THE EVENT OF
ANY DEFECT OR DEFICIENCY OF ANY NATURE, WHETHER PATENT OR LATENT,
THE LESSOR SHALL HAVE NO RESPONSIBILITY OR LIABILITY WITH RESPECT
THERETO.
SECTION 8.2. HOLD HARMLESS PROVISIONS. (A) The Lessee hereby
(i) releases the Lessor and its members, officers, agents (other
than the Lessee) and employees from, (ii) agrees that the Lessor
and its members, officers, agents (other than the Lessee) and
employees shall not be liable for, and (iii) agrees to indemnify,
defend and hold the Lessor and its members, officers, agents
(other than the Lessee) and employees harmless from and against:
any and all claims, causes of action, judgments, liabilities,
damages, losses, costs and expenses arising as a result of the
Lessor's undertaking the Project, including, but not limited to,
(1) liability for loss or damage to Property or bodily injury to
or death of any and all Persons that may be occasioned, directly
or indirectly, by any cause whatsoever pertaining to the Project
Facility or arising by reason of or in connection with the
occupation or the use thereof or the presence of any Person or
Property on, in or about the Project Facility, (2) liability
arising from or expense incurred by the Lessor's acquiring,
constructing, reconstructing, installing, owning or selling the
Project Facility, including, without limiting the generality of
the foregoing, any sales or use taxes which may be payable with
respect to goods supplied or services rendered with respect to
the Project Facility and any and all claims for brokerage,
leasing, finders or similar fees which may be made relating to
the Project Facility, all liabilities or claims arising as a
result of the Lessor's obligations under this Lease Agreement or
any of the other Leasing Documents or the enforcement of or
defense of validity of any provision of any Leasing Documents,
and any and all liability arising out of environmental matters
with respect to the Project Facility, and (3) all causes of
action and reasonable attorneys' fees and other expenses incurred
in connection with any suits or actions which may arise as a
result of any of the foregoing; provided that any such claims,
causes of action, judgments, liabilities, damages, losses, costs
or expenses of the Lessor are not incurred or do not result from
the intentional wrongdoing of the Lessor or any of its members,
officers, agents (other than the Lessee) or employees. The
foregoing indemnities shall apply notwithstanding the fault or
negligence in part of the Lessor or any of its officers, members,
agents or employees and notwithstanding the breach of any
statutory obligation or any rule of comparative or apportioned
liability.
(B) In the event of any claim against the Lessor or its
members, officers, agents (other than the Lessee) or employees by
any employee of the Lessee or any contractor of the Lessee or
anyone directly or indirectly employed by any of them or anyone
for whose acts any of them may be liable, the obligations of the
Lessee hereunder shall not be limited in any way by any
limitation on the amount or type of damages, compensation or
benefits payable by or for the Lessee or such contractor under
workers' compensation laws, disability benefits laws or other
employee benefit laws.
(C) To effectuate the provisions of this Section 8.2, the
Lessee agrees to provide for and insure, in the liability
policies required by Section 6.3(C) of this Lease Agreement, its
liabilities assumed pursuant to this Section 8.2.
(D) Notwithstanding any other provisions of this Lease
Agreement, the obligations of the Lessee pursuant to this Section
8.2 shall remain in full force and effect after the termination
of this Lease Agreement until the expiration of the period stated
in the applicable statute of limitations during which a claim,
cause of action or prosecution relating to the matters herein
described may be brought and the payment in full or the
satisfaction of such claim, cause of action or prosecution and
the payment of all expenses, charges and costs incurred by the
Lessor, or its officers, members, agents (other than the Lessee)
or employees, relating thereto.
SECTION 8.3. RIGHT OF ACCESS TO PROJECT FACILITY. The Lessee
agrees that the Lessor and their duly authorized agents shall
have the right at all reasonable times to enter upon and to
examine and inspect the Project Facility.
SECTION 8.4. THE LESSEE NOT TO TERMINATE EXISTENCE OR DISPOSE OF
ASSETS. The Lessee agrees that, so long as the Lease Agreement
is in effect, it will maintain its existence and will not
dissolve or otherwise dispose of all or substantially all of its
assets absent the prior written consent of the Lessor, which
consent will not be unreasonably withheld or delayed.
SECTION 8.5. AGREEMENT TO PROVIDE INFORMATION. The Lessee
agrees, whenever requested by the Lessor, to provide and certify
or cause to be provided and certified such information concerning
the Lessee, its finances and other topics as the Lessor from time
to time reasonably consider necessary or appropriate, including,
but not limited to, such information as to enable the Lessor to
make any reports required by law or governmental regulation.
SECTION 8.6. COMPLIANCE WITH ORDERS, ORDINANCES, ETC. (A)
The Lessee agrees that it will, during any period in which the
Lease Agreement is in effect, promptly comply with all statutes,
codes, laws, acts, ordinances, orders, judgments, decrees,
injunctions, rules, regulations, permits, licenses,
authorizations, directions and requirements of all Governmental
Authorities, foreseen or unforeseen, ordinary or extraordinary,
which now or at any time hereafter may be applicable to the
Lessee or the Project Facility or any part thereof, or to any
use, manner of use or condition of the Project Facility or any
part thereof.
(B) Notwithstanding the provisions of subsection (A) of
this Section 8.6, the Lessee may in good faith actively contest
the validity or the applicability of any requirement of the
nature referred to in such subsection (A), provided that the
Lessee (1) first shall have notified the Lessor in writing of
such contest, (2) is not in default under any of the Leasing
Documents and (3) shall have set aside adequate reserves for any
such requirement. Otherwise, the Lessee shall promptly take such
action with respect thereto as shall be satisfactory to the
Lessor.
(C) Notwithstanding the provisions of subsection (B) of
this Section 8.6, if the Lessor or any of its members, officers,
agents, servants or employees may be liable for prosecution for
failure to comply therewith, the Lessee shall promptly take such
action with respect thereto as shall be satisfactory to the
Lessor.
SECTION 8.7. PERFORMANCE BY LESSOR OF LESSEE'S OBLIGATIONS.
Should the Lessee fail to make any payment or to do any act as
herein provided, the Lessor may, but need not, without notice to
or demand on the Lessee and without releasing the Lessee from any
obligation herein, make or do the same, including, without
limitation, appearing in and defending any action purporting to
affect the rights or powers of the Lessee or the Lessor, and
paying all expenses, including, without limitation, reasonable
attorneys' fees; and the Lessee shall pay immediately upon demand
all sums so expended by the Lessor under the authority hereof,
together with interest thereon at the rate of two percent (2%)
per month or the maximum permitted by law, whichever is less.
SECTION 8.8. DEPRECIATION DEDUCTIONS AND TAX CREDITS. The
parties agree that as between them the Lessee shall be entitled
to all depreciation deductions and accelerated cost recovery
system deductions with respect to any portion of the Project
Facility pursuant to Sections 167 and 168 of the Internal Revenue
Code of 1986, as amended (the "Code"), and to any investment
credit pursuant to Section 38 of the Code with respect to any
portion of the Project Facility which constitutes "Section 38
Property" and to all other state and/or federal income tax
deductions and credits which may be available with respect to the
Project Facility.
ARTICLE IX
ASSIGNMENTS; MERGER OF LESSOR
SECTION 9.1. RESTRICTION ON TRANSFER OF LESSOR'S INTEREST
HEREUNDER. Except as otherwise specifically provided in this
Article IX hereof and except for a conveyance by the Lessor in
accordance with the provisions of Section 10.2(A)(4) hereof,
neither the Lessor nor the Lessee shall sell, assign or otherwise
dispose of any of their rights under this Lease Agreement,
without the prior written consent of the Lessee or the Lessor, as
the case may be, which consents shall not be unreasonably
withheld or delayed.
SECTION 9.2. ASSIGNMENT OF THIS LEASE AGREEMENT. This Lease
Agreement may be assigned by the Lessee, in whole or in part, but
only with the prior written consent of the Lessor, which consent
shall not be unreasonably withheld or delayed, and provided that:
(1) no assignment shall relieve the Lessee from
primary liability for any of its obligations hereunder;
(2) the assignee shall be qualified to transact
business in the State of New York and shall assume the
obligations of the Lessee hereunder to the extent of the interest
assigned;
(3) the Lessee shall, within ten (10) days after the
delivery thereof, furnish or cause to be furnished to the Lessor
a true and complete copy of such assignment and the instrument of
assumption; and
(4) the Facility shall continue to constitute a
"project" as such quoted term is defined in the Act.
SECTION 9.3. MERGER OF THE LESSOR. (A) Nothing contained in
this Lease Agreement shall prevent the consolidation of the
Lessor with, or merger of the Lessor into, or assignment by the
Lessor of its rights and interests hereunder to, any other public
benefit corporation of the State or political subdivision thereof
which has the legal authority to perform the obligations of the
Lessor hereunder, provided that upon any such consolidation,
merger or assignment, the due and punctual performance and
observance of all of the agreements and conditions of this Lease
Agreement to be kept and performed by the Lessor shall be
expressly assumed in writing by the public benefit corporation or
political subdivision resulting from such consolidation or
surviving such merger or to which the Lessor's rights and
interests hereunder or under this Lease Agreement shall be
assigned.
(B) As of the date of any such consolidation, merger or
assignment, the Lessor shall give notice thereof in reasonable
detail to the Lessee. The Lessor shall promptly furnish to the
Lessee such additional information with respect to any such
consolidation, merger or assignment as the Lessee reasonably may
request.
SECTION 9.4. SALE OR LEASE OF PROJECT FACILITY. Except as
provided for below, the Lessee may not otherwise sell, lease,
transfer, convey or otherwise dispose of the Project Facility or
any part thereof without the prior written consent of the Lessor,
which consent shall not be unreasonably withheld or delayed.
Notwithstanding the foregoing, the Lessee may sell or otherwise
dispose of any items of personal property constituting Equipment
without obtaining the prior consent of the Lessor. The Lessor
agrees to execute any documents and instruments as may be
reasonably required in order to effectuate any such sale or
disposal, upon written request of the Lessee and at no cost or
expense to the Lessor.
ARTICLE X
EVENTS OF DEFAULT AND REMEDIES
SECTION 10.1. EVENTS OF DEFAULT DEFINED. (A) The following
shall be "Events of Default" under this Lease Agreement, and the
terms "Event of Default" or "Default" shall mean, whenever they
are used in this Lease Agreement, any one or more of the
following events:
(1) A default by the Lessee in the due and punctual payment
of the amounts specified to be paid pursuant to Section 5.4 (A)
hereof, and the continuance thereof for a period of ten (10)
days.
(2) A default in the performance or observance of any other
of the covenants, conditions or agreements on the part of the
Lessee in this Lease Agreement and the continuance thereof for a
period of thirty (30) days after written notice is given by the
Lessor to the Lessee; provided, however, that if such default
cannot reasonably be cured within said thirty (30) day period and
the Lessor or the Lessee shall have commenced action to cure the
breach of covenant within said thirty (30) day period, and
thereafter diligently and expeditiously proceeds to cure the
same, such thirty (30) day period shall be extended for so long
as the Lessor or the Lessee shall require, in the exercise of due
diligence, to cure such default, it being agreed that no such
extension shall be for a period in excess of sixty (60) days. If
any conflict shall exist between the provisions of this
Subsection (2) and the immediately following Subsection (3) as to
when an Event of Default has occurred, the provisions of such
Subsection (3) shall govern.
(3) The occurrence of an Event of Default under any of the other
Leasing Documents.
(4) Any representation or warranty made by the Lessee herein or
in any other Leasing Document proves to have been false in any
material manner at the time it was made.
(5) (a) The filing by the Lessee (as debtor) of a voluntary
petition under Title 11 of the United States Code or any other
federal or state bankruptcy statute, (b) the failure by the
Lessee within ninety (90) days to lift any execution, garnishment
or attachment of such consequence as will impair the Lessee's
ability to carry out its obligations hereunder, (c) the
commencement of a case under Title 11 of the United States Code
against the Lessee as the debtor or commencement under any other
federal or state bankruptcy statute of a case, action or
proceeding against the Lessee and continuation of such case,
action or proceeding without dismissal for a period of ninety
(90) days, (d) the entry of an order for relief by a court of
competent jurisdiction under Title 11 of the United States Code
or any other federal or state bankruptcy statute with respect to
the debts of the Lessee, or (e) in connection with any insolvency
or bankruptcy case, action or proceeding, appointment by final
order, judgment or decree of a court of competent jurisdiction of
a receiver or trustee of the whole or a substantial portion of
the Property of the Lessee, unless such order, judgment or decree
is vacated, dismissed or dissolved within ninety (90) days of
such appointment.
(6) If by order of a court of competent jurisdiction,
a trustee, receiver or liquidator of the Lessee or the Project
Facility or any part thereof, shall be appointed and such order
shall not be discharged or dismissed within ninety (90) days
after such appointment.
(7) The dissolution of the Lessee.
(8) If a Lien for the performance of work or the
supply of materials is filed against the Project Facility and is
not satisfied or bonded within sixty (60) days after notice of
filing thereof is received by the Lessee or if the Project
Facility is encumbered by any other Lien or encumbrance not
approved by the Lessor for sixty (60) or more days after the
Lessee has actual knowledge or written notice of the existence of
such Lien or encumbrance.
(9) If at any time any insurance policy required to be
maintained pursuant to any of the Leasing Documents shall be
canceled, terminated or lapse and shall not have been replaced
prior to the effective date of such cancellation, termination or
lapse by a policy covering the same matters as the lapsed policy,
which new policy shall comply with all requirements in the
Leasing Documents relating to such type of insurance.
(10) If any real estate tax, payment in lieu of tax or
assessment payable with respect to the Project Facility is not
paid before any fine, penalty or interest shall be due with
respect thereto.
SECTION 10.2. REMEDIES ON DEFAULT. (A) Whenever any Event of
Default shall have occurred, the Lessor may, to the extent
permitted by law, take any one or more of the following remedial
steps:
(1) Declare, by written notice to the Lessee, to be
immediately due and payable, whereupon the same shall become
immediately due and payable, (a) all unpaid payments payable
pursuant to Section 5.4(A) hereof, and (b) all other payments due
under this Lease Agreement or any of the other Leasing Documents.
(2) Enforce or terminate this Lease Agreement.
(3) Take any other action at law or in equity which
may appear necessary or desirable to collect any amounts then due
or thereafter to become due hereunder and to enforce the
obligations, agreements or covenants of the Lessee under this
Lease Agreement.
(4) In the event of a default by the Lessee in the
payment of any amounts due and owing under the PILOT Agreement,
terminate this Lease Agreement and the PILOT Agreement and
reconvey the Project Facility to the Lessee. The Lessee hereby
consents to said reconveyance and appoints the Lessor its
attorney-in-fact, which appointment is coupled with an interest
and is irrevocable, to execute any and all instruments and
documents in its name as may be necessary, in the sole discretion
of the Lessor, to effectuate such transfer.
(B) No action taken pursuant to this Section 10.2
shall relieve the Lessee from its obligations to make all
payments required by this Lease Agreement and the other Leasing
Documents.
SECTION 10.3. REMEDIES CUMULATIVE. No remedy herein conferred
upon or reserved to the Lessor is intended to be exclusive of any
other available remedy, but each and every such remedy shall be
cumulative and in addition to every other remedy given under this
Lease Agreement or now or hereafter existing at law or in equity.
No delay or omission to exercise any right or power accruing upon
any default shall impair any such right or power or shall be
construed to be a waiver thereof, but any such right and power
may be exercised from time to time and as often as may be deemed
expedient. In order to entitle the Lessor to exercise any remedy
reserved to it in this Article X, it shall not be necessary to
give any notice, other than such notice as may be herein
expressly required.
SECTION 10.4. AGREEMENT TO PAY ATTORNEYS' FEES AND EXPENSES. In
the event the Lessee should default under any of the provisions
of this Lease Agreement and the Lessor should employ attorneys
or incur other expenses for the collection of amounts payable
hereunder or the enforcement of performance or observance of any
obligations or agreements on the part of the Lessee herein
contained, the Lessee shall, on demand therefor, pay to the
Lessor the reasonable fees of such attorneys and such other
expenses so incurred, whether an action is commenced or not.
SECTION 10.5. NO ADDITIONAL WAIVER IMPLIED BY ONE WAIVER. In
the event any agreement contained herein should be breached by
either party and thereafter such breach be waived by the other
party, such waiver shall be limited to the particular breach so
waived and shall not be deemed to waive any other breach
hereunder.
ARTICLE XI
EARLY TERMINATION OF LEASE AGREEMENT
SECTION 11.1. OPTION TO TERMINATE LEASE AGREEMENT. The Lessee
shall have, if there exists no Event of Default hereunder, the
option to cancel or terminate this Lease Agreement, subject to
the survival of those obligations of the Lessee which are
intended to survive the term of this Lease Agreement, upon
payment of all payments currently due and owing pursuant to
Sections 5.4 and 6.6 hereof, and by giving the Lessor notice in
writing of such termination and thereupon such termination shall
forthwith become effective.
SECTION 11.2. OBLIGATION TO SELL AND PURCHASE THE PROJECT
FACILITY. Upon termination of this Lease Agreement in accordance
with Section 5.2 or 11.1 hereof, the Lessor shall be obligated to
sell the Project Facility to the Lessee, and the Lessee shall be
obligated to purchase the Project Facility from the Lessor for
the purchase price of One Dollar ($1.00) plus payment of all sums
due and payable to the Lessor hereunder.
SECTION 11.3. CONVEYANCE OF PROJECT FACILITY UPON PURCHASE. (A)
At the closing of any purchase of the Project Facility pursuant
to Section 11.2 hereof, the Project Facility shall be conveyed
from the Lessor to the Lessee subject only to Permitted
Encumbrances. The Lessee agrees to prepare the Deed to Lessee
together with all gains tax affidavits, equalization and
assessment forms and other necessary documentation and to forward
same to the Lessor at least thirty (30) days prior to the date
that the Project Facility is to be conveyed to the Lessee. The
Lessee will pay all expenses and taxes, if any, applicable to or
arising from such transfers of title.
(B) The sale and conveyance of the Lessor's right, title
and interest in and to the Land and the Facility shall be
effected by the execution, delivery and recording by the Lessor
of the Deed to Lessee (in substantially the form attached hereto
as Exhibit "B" and by this reference made a part hereof).
(C) The sale and conveyance of the Lessor's right, title
and interest in and to the Equipment shall be effected by the
execution and delivery by the Lessor of the ▇▇▇▇ of Sale to
Lessee (in substantially the form attached hereto as Exhibit "C"
and by this reference made a part hereof.
(D) The Lessee hereby agrees to pay all expenses, filing
and recording fees and taxes, if any, and the reasonable
attorneys' fees of the Lessor applicable to or arising from the
transfers contemplated by this Section 11.3.
(E) If, upon conveyance of the Project Facility to the
Lessee pursuant to this Section 11.3, the Lessor has failed to
comply with the covenant set forth in Section 2.1(D) hereof, the
Lessee may, at its option, accept the conveyance subject to the
Lessee's right to seek redress as against the Lessor for such
failure to comply with Section 2.1(D).
ARTICLE XII
MISCELLANEOUS
SECTION 12.1. NOTICES. All notices, certificates and other
communications hereunder shall be in writing and shall be
sufficiently given and shall be deemed given when (A) sent to the
applicable address stated below by registered or certified mail,
return receipt requested, or by such other means (including
overnight delivery) as shall provide the sender with documentary
evidence of such delivery, or (B) delivery is refused by the
addressee, as evidenced by the affidavit of the person who
attempted to effect such delivery. The addresses to which
notices, certificates and other communications hereunder shall be
delivered are as follows:
IF TO THE LESSEE:
Ace Hardware Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Ace Hardware Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇
IF TO THE LESSOR:
County of Saratoga Industrial
Development Agency
Saratoga County Municipal Center
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Chairman
WITH A COPY TO:
Snyder, Kiley, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
The Lessor and the Lessee may, by notice given hereunder,
designate any further or different addresses to which subsequent
notices, certificates and other communications shall be sent.
SECTION 12.2. BINDING EFFECT. This Lease Agreement shall inure
to the benefit of the Lessor and the Lessee, and shall be binding
upon the Lessor, the Lessee and, as permitted by this Lease
Agreement, their respective successors and assigns.
SECTION 12.3. SEVERABILITY. If any one or more of the covenants
or agreements provided herein on the part of the Lessor or the
Lessee to be performed shall, for any reason, be held or shall,
in fact, be inoperative, unenforceable or contrary to law in any
particular case, such circumstance shall not render the provision
in question inoperative or unenforceable in any other case or
circumstance. Further, if any one or more of the phrases,
sentences, clauses, paragraphs or sections herein shall be
contrary to law, then such covenant or covenants or agreement or
agreements shall be deemed separable from the remaining covenants
and agreements hereof and shall in no way affect the validity of
the other provisions of this Lease Agreement.
SECTION 12.4. AMENDMENTS, CHANGES AND MODIFICATIONS. This Lease
Agreement may not be amended, changed, modified, altered or
terminated, except by an instrument in writing signed by the
parties hereto.
SECTION 12.5. EXECUTION OF COUNTERPARTS. This Lease Agreement
may be executed in several counterparts, each of which shall be
an original and all of which shall constitute but one and the
same instrument.
SECTION 12.6. APPLICABLE LAW. This Lease Agreement shall be
governed exclusively by the applicable laws of the State.
SECTION 12.7. RECORDING AND FILING. The Deed to Lessor and this
Lease Agreement (or a Memorandum thereof) shall be recorded by
the Lessor at the expense of the Lessee in the office of the
Clerk of Saratoga County, New York, or in such other office as
may at the time be provided by law as the proper place for the
recordation or filing thereof.
SECTION 12.8. SURVIVAL OF OBLIGATIONS. The obligations of the
Lessee to make the payments required by Section 5.4(A) hereof and
to provide the indemnity required by Section 8.2 hereof shall
survive the termination of this Lease Agreement, and all such
payments after such termination shall be made upon demand of the
party to whom such payment is due.
SECTION 12.9. TABLE OF CONTENTS AND SECTION HEADINGS NOT
CONTROLLING. The table of contents and the headings of the
several sections in this Lease Agreement have been prepared for
convenience of reference only and shall not control, affect the
meaning of or be taken as an interpretation of any provision of
this Lease Agreement.
SECTION 12.10. NO RECOURSE; SPECIAL OBLIGATION. The obligations
and agreements of the Lessor contained herein and in the other
Leasing Documents and any other instruments or documents executed
in connection therewith or herewith, and any other instrument or
document supplemental thereto or hereto, shall be deemed the
obligations and agreements of the Lessor, and not of any member,
officer, agent (other than the Lessee) or employee of the Lessor
in his or her individual capacity, and the members, officers,
agents (other than the Lessee) and employees of the Lessor shall
not be liable personally hereon or thereon or be subject to any
personal liability or accountability based upon or in respect
hereof or thereof or of any transaction contemplated hereby or
thereby. The obligations and agreements of the Lessor contained
herein and therein shall not constitute or give rise to an
obligation of the State of New York or the County of Saratoga,
New York, and neither the State of New York nor the County of
Saratoga, New York shall be liable hereon or thereon, and,
further, such obligations and agreements shall not constitute or
give rise to a general obligation of the Lessor, but rather shall
constitute limited, special obligations of the Lessor payable
solely from the revenues of the Lessor derived and to be derived
from the sale or other disposition of the Project Facility
(except for revenues derived by the Lessor with respect to the
Unassigned Rights). No order or decree of specific performance
with respect to any of the obligations of the Lessor hereunder
shall be sought or enforced against the Lessor unless (A) the
party seeking such order or decree shall first have requested the
Lessor in writing to take the action sought in such order or
decree of specific performance, and ten (10) days shall have
elapsed from the date of receipt of such request, and the Lessor
shall have refused to comply with such request (or, if compliance
therewith would reasonably be expected to take longer than ten
[10] days, shall have failed to institute and diligently pursue
action to cause compliance with such request) or failed to
respond within such notice period, (B) if the Lessor refuses to
comply with such request and the Lessor's refusal to comply is
based on its reasonable expectation that it will incur fees and
expenses, the party seeking such order or decree shall have
placed in an account with the Lessor an amount or undertaking
sufficient to cover such reasonable fees and expenses, and (C) if
the Lessor refuses to comply with such request and the Lessor's
refusal to comply is based on its reasonable expectation that it
or any of its members, officers, agents (other than the Lessee)
or employees shall be subject to potential liability, the party
seeking such order or decree shall (1) agree to indemnify, hold
harmless and defend the Lessor and its members, officers, agents
(other than the Lessee) and employees against any liability
incurred as a result of its compliance with such demand, and (2)
if requested by the Lessor, furnish to the Lessor satisfactory
security to protect the Lessor and its members, officers, agents
(other than the Lessee) and employees against all liability
expected to be incurred as a result of compliance with such
request. Any failure to provide the indemnity required in this
Section 12.10 shall not affect the full force and effect of an
Event of Default under any of the Leasing Documents.
SECTION 12.11. SUBMISSION TO JURISDICTION. The Lessee hereby
irrevocably and unconditionally agrees that any suit, action or
proceeding arising out of or relating to this Lease Agreement
shall be brought in the state courts of the State of New York or
federal district court for the Northern District of New York and
waives any right to object to jurisdiction within either of the
foregoing forums by the Lessor. Nothing contained herein shall
prevent the Lessor from bringing any suit, action or proceeding
or exercising any rights against any security and against the
Lessee personally, and against any property of the Lessee, within
any other jurisdiction and the initiation of such suit, action or
proceeding or taking of such action in any such other
jurisdiction shall in no event constitute a waiver of the
agreements contained herein with respect to the laws of the State
of New York governing the rights and obligations of the parties
hereto or the agreement of the Lessee to submit to personal
jurisdiction within the State of New York.
IN WITNESS WHEREOF, the Lessor and the Lessee have caused
this Lease Agreement to be executed in their respective names by
their respective Authorized Representatives, all as of the day
and year first above written.
COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY
By:______________________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman
ACE HARDWARE CORPORATION
By:______________________________________________
Name:___________________________________________
Title:____________________________________________
STATE OF NEW YORK )
) SS.:
COUNTY OF )
On the ____ day of ____________, 1996, before me personally
came ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, to me known, who being by me duly sworn,
did depose and say that he resides in Ballston Spa, New York,
that he is the CHAIRMAN of the COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY, the public benefit corporation of the State
of New York described in and which executed the foregoing
instrument, and that he signed his name thereto by authority of
said public benefit corporation.
_______________________________________
Notary Public
STATE OF ILLINOIS )
) SS.:
COUNTY OF DUPAGE )
On this __ day of ___________, 1996, before me personally
came ________________, to me known, who being by me duly sworn,
did depose and say that he resides in ________________________,
that he is the _________________ of ACE HARDWARE CORPORATION, the
corporation described in and which executed the foregoing
instrument, and that he signed his name thereto by order of the
Board of Directors of said corporation.
_______________________________________
Notary Public
EXHIBIT "A"
DESCRIPTION OF LAND
EXHIBIT "B"
FORM OF DEED TO LESSEE
THIS INDENTURE made __________________, ____, between COUNTY
OF SARATOGA INDUSTRIAL DEVELOPMENT AGENCY, a public benefit
corporation organized under the laws of the State of New York,
with offices at Saratoga County Municipal Center, ▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, party of the first part,
and
ACE HARDWARE CORPORATION, a Delaware corporation and having
an address of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 60521-
2134, party of the second part
WITNESSETH that the party of the first part, in
consideration of One and 00/100 dollars ($1.00), lawful money of
the United States, and other good and valuable consideration paid
by the party of the second part, does hereby grant and release
unto the party of the second part, its successors and assigns all
the following described premises:
[Insert description of Land from Deed to Lessor]
TOGETHER with the appurtenances and all the estate and
rights of the party of the first part in and to said premises,
TO HAVE AND TO HOLD the premises herein granted unto the
party of the second part, the heirs or successors and assigns of
the party of the second part forever.
The word "party" shall be construed as if it read "parties"
whenever the sense of this Indenture so requires.
IN WITNESS WHEREOF, the party of the first part has duly
executed this deed the day and year first above written.
COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY
By:______________________________________________
, Chairman
EXHIBIT "C"
FORM OF ▇▇▇▇ OF SALE TO LESSEE
County of Saratoga Industrial Development Agency, a public
benefit corporation of the State of New York (the "State") having
its office at Saratoga County Municipal Center, ▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Grantor"), for the
consideration of One Dollar ($1.00), cash in hand paid, and other
good and valuable consideration received by the Grantor from Ace
Hardware Corporation, a Delaware corporation having an address of
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ (the
"Grantee"), the receipt of which is hereby acknowledged by the
Grantor, hereby sells, transfers and delivers unto the Grantee,
and its successors and assigns, all those machinery, equipment,
fixtures or furnishings installed into the Facility (as defined
in the lease agreement dated as of September 1, 1996, [the "Lease
Agreement"] by and between the Grantor and the Grantee) and such
additions thereto and substitutions therefor as may be made from
time to time.
TO HAVE AND TO HOLD the same unto the Grantee, and its
successors and assigns, forever.
THE GRANTOR MAKES NO WARRANTY, EITHER EXPRESS OR IMPLIED, AS
TO THE CONDITION, TITLE, DESIGN, OPERATION, MERCHANTABILITY OR
FITNESS OF ANY OF THE EQUIPMENT DESCRIBED ABOVE. THE GRANTEE
ACCEPTS TITLE TO SUCH EQUIPMENT "AS IS", WITHOUT RECOURSE AGAINST
THE GRANTOR FOR ANY CONDITION NOW OR HEREAFTER EXISTING. IN THE
EVENT OF A DEFICIENCY OR DEFAULT OF ANY NATURE, WHETHER PATENT OR
LATENT, THE GRANTOR SHALL HAVE NO RESPONSIBILITY OR LIABILITY
WHATSOEVER WITH RESPECT THERETO.
IN WITNESS WHEREOF, the Grantor has caused this ▇▇▇▇ of sale
to be executed in its name by its duly authorized officer on the
date indicated beneath the signature of such officer and dated as
of the _____ day of __________, ____.
COUNTY OF SARATOGA INDUSTRIAL
DEVELOPMENT AGENCY
By:______________________________
, Chairman