NET LEASE AGREEMENT
THIS LEASE, made and entered into effective as of this 30
day of March, 2001, by and between AEI Fund Management XVII,
Inc. a Minnesota corporation, whose address is 1300 Minnesota
World Trade Center, ▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ("Lessor"), and Aramark Educational Resources, Inc., dba
Children's World Learning Centers, Inc., a Delaware corporation,
whose address is Attention: Property Controller, Aramark
Educational Resources, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Lessee");
WITNESSETH:
WHEREAS, Lessor is the fee owner of a certain parcel of real
property and improvements located at ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇, and legally described in Exhibit "A" attached
hereto and incorporated herein by reference; and
WHEREAS, Lessee constructed or caused the construction of
the building and improvements (together the "Building") on the
real property described in Exhibit "A"; and
WHEREAS, Lessee desires to sell said real property and
Building together with any easements and other rights appurtenant
thereto (said real property and Building hereinafter referred to
as the "Leased Premises"), to Lessor and simultaneously lease
said real property and Building, together with any easements and
other rights appurtenant thereto, back from Lessor upon the
terms and conditions hereinafter provided;
NOW, THEREFORE, in consideration of the rents, terms,
covenants, conditions, and agreements hereinafter described to be
paid, kept, and performed by Lessee, Lessor does hereby grant,
demise, lease, and let unto Lessee, and Lessee does hereby take
and hire from Lessor and does hereby covenant, promise, and agree
as follows:
ARTICLE 1. LEASED PREMISES
Lessor hereby leases to Lessee, and Lessee leases and takes
from Lessor, the Leased Premises subject to the conditions of
this Lease.
ARTICLE 2. TERM
(A) The term of this Lease ("Term") shall be fifteen (15)
consecutive "Lease Years", as hereinafter defined, commencing on
March, 2001 ("Occupancy Date").
(B) The first "Lease Year" of the Term shall be for a
period of twelve (l2) consecutive calendar months beginning at
the Occupancy Date. If the Occupancy Date shall be other than the
first day of a calendar month, the first "Lease Year" shall be
the period of time from the Occupancy Date to the end of the
calendar month of the Occupancy Date, plus the following twelve
(l2) calendar months. Each Lease Year after the first Lease Year
shall be a successive period of twelve (l2) calendar months.
(C) A short form or memorandum of this Lease has been
executed for recording purposes in the form attached as Exhibit B
hereto. Termination of Lessee's right to possession shall be
conclusive evidence of termination of any option to renew,
purchase, or to any right of first refusal, if any. Entry of a
court order terminating Lessee's right of possession shall be
sufficient evidence of the termination of any rights established
by such Memorandum of Lease, and the Memorandum of Lease shall so
state. Abandonment of the Leased Premises by Lessee shall not be
considered a termination of Lessee's right to possession of the
Leased Premises if Lessee continues maintenance of the Premises
and payment of rent under the terms of the Lease.
ARTICLE 3. RESPONSIBILITY FOR IMPROVEMENTS
(A) Lessee represents, to the best of its knowledge, that
the Building and all other improvements to the land do materially
comply with the applicable laws, ordinances, rules, and
regulations of all state, federal and local governments.
Knowledge of Lessee shall be defined as and limited to the actual
knowledge of ▇▇▇▇ ▇▇▇▇▇ or those persons immediately under his
supervision, limited to ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇.
(B) Opening for business in the Leased Premises by Lessee
shall constitute an acceptance of the Leased Premises "as is and
where is" and an acknowledgment by Lessee that the premises are
in the condition described under this Lease and that Lessee is
responsible for the correction or repair of any defects or
deficiencies in or of the Premises whether in existence as of the
date of this Lease or discovered after such date, including but
not limited to material compliance with applicable laws,
ordinances, rules and regulations of all state, federal, and
local governments.
ARTICLE 4. RENTAL PAYMENTS
A. Annual Rent Payable for the first through Fifth Lease
Years:
For each of the first five Lease Years, Lessee
shall pay to Lessor an annual rent of $166,535, which
amount shall be payable in advance without demand on
the first day of each month in equal monthly
installments of $13,877.92 to Lessor. If the first
day of the first month of the Lease Term is not the
first day of a calendar month, then the monthly
rental payable for that partial month shall be a
prorated portion of the equal monthly installment of
rent.
B. Annual Rent Payable for the Sixth through Tenth Lease
Years:
The Annual Rent payable for the Sixth through
the Tenth Lease Years shall be the same amount each
year and shall be computed at the beginning of the
sixth Lease Year to be an amount equal to the rent
paid for the Fifth Lease Year, increased by the
lesser of ten percent (10%) of the rent for the Fifth
Lease Year, or two hundred percent (200%) of the "CPI
Increase", as defined below, times the rent for the
Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date at four
months prior to the effective date of the Lease to
the nearest date four months prior to the last day of
the Fifth Lease Year. (For purposes of determining
this increase, the Consumer Price Index for the
fourth month preceding the effective date of the
Lease shall be compared to the CPI for the month that
is four months prior to the end of the Fifth Lease
Year.)
C. Annual Rent Payable for the Eleventh through
Fifteenth Lease Years:
The Annual Rent payable for the Eleventh through
the Fifteenth Lease Years shall be the same amount
each year and shall be computed at the beginning of
the Eleventh Lease Year to be an amount equal to the
rent paid for the Tenth Lease Year, increased by the
lesser of ten percent (10%) of the rent for the Tenth
Lease Year, or two hundred percent (200%) of the "CPI
Increase", as defined below, times the rent for the
Tenth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the last day of the Fifth Lease Year to the
nearest date four months prior to the last day of the
Tenth Lease Year.
D. Annual Rent Payable for the Sixteenth through
Twentieth Lease Years:
The Annual Rent payable for the Sixteenth
through the Twentieth Lease Years shall be the same
amount each year and shall be computed at the
beginning of the Sixteenth Lease Year to be an amount
equal to the rent paid for the Fifteenth Lease Year,
increased by the lesser of ten percent (10%) of the
rent for the Fifteenth Lease Year, or two hundred
percent (200%) of the "CPI Increase", as defined
below, times the rent for the Fifteenth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the last day of the Tenth Lease Year to the
nearest date four months prior to the last day of the
Fifteenth Lease Year.
E. Annual Rent Payable for the Twenty-First through
Twenty-Fifth Lease Years:
The Annual Rent payable for the Twenty-First
through the Twenty-Fifth Lease Years shall be the
same amount each year and shall be computed at the
beginning of the Twenty-First Lease Year to be an
amount equal to the rent paid for the Twentieth Lease
Year, increased by the lesser of ten percent (10%) of
the rent for the Twentieth Lease Year, or two hundred
percent (200%) the "CPI Increase", as defined below,
times the rent for the Twentieth Lease Year.
"CPI-U Increase" referred to above is defined as the
percentage increase, if any, in the Consumer Price
Index ("CPI") for all Urban Consumers published by
the Bureau of Labor Statistics of the United States
Department of Labor for U.S. City Average, All Items
(1982-84=100) from the nearest date four months prior
to the last day of the Fifteenth Lease Year to the
nearest date four months prior to the last day of the
Twentieth Lease Year.
F. Annual Rent Payable for the Twenty-Sixth through
Thirtieth Lease Years:
The Annual Rent payable for the Twenty-Sixth
through the Thirtieth Lease Years shall be the same
amount each year and shall be computed at the
beginning of the Twenty-Sixth Lease Year to be an
amount equal to the rent paid for the Twenty-Fifth
Lease Year, increased by the lesser of ten percent
(10%) of the rent for the Twenty-Fifth Lease Year, or
two hundred percent (200%) the "CPI Increase", as
defined below, times the rent for the Twenty-Fifth
Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the last day of the Twentieth Lease Year to
the nearest date four months prior to the last day of
the Twenty-Fifth Lease Year.
G. Overdue Payments.
Lessee shall pay interest on all overdue
payments of Rent or other monetary amounts due
hereunder at a rate equal to the prime rate (as
announced by the Wall Street Journal newspaper) plus
two percent, accruing from the date such Rental or
other monetary amounts were properly due and payable.
ARTICLE 5. INSURANCE AND INDEMNITY
(A) Lessee shall, throughout the Term or Renewal Terms, if
any, of this Lease, at its own cost and expense, procure and
maintain insurance which covers the Leased Premises and
improvements against fire, wind, and storm damage (including
flood insurance if the Leased Premises is in a federally
designated flood prone area) and such other risks as may be
included in the broadest form of extended coverage insurance as
may, from time to time, be available in amounts sufficient to
prevent Lessor or Lessee from becoming a co-insurer within the
terms of the applicable policies. In any event, the insurance
coverage shall not be less than one hundred percent (100%) of the
then insurable value. Additionally, replacement cost
endorsements, vandalism endorsement, malicious mischief
endorsement, waiver of subrogation endorsement, waiver of co-
insurance endorsement (if available), shall be obtained.
(B) Lessee agrees to place and maintain throughout the
Term or Renewal Terms, if any, of this Lease, at Lessee's own
expense, public liability insurance with respect to Lessee's use
and occupancy of said premises, with initial limits of at least
$5,000,000 combined single limit for bodily injury and $l00,000
for property damage, or such additional amounts subject to
commercially reasonable deductibles, as Lessor shall reasonably
require from time to time, and pollution liability or
environmental impact coverage with limits in amounts reasonably
acceptable to Lessor.
(C) Lessee agrees to notify Lessor in writing if Lessee is
unable to procure all or some part of the aforesaid insurance. In
the event Lessee fails to provide all insurance required under
this Lease, Lessor shall have the right, but not the obligation,
to procure such insurance on Lessee's behalf. Lessee will then,
within ten (10) business days from receiving written notice, pay
Lessor the amount of the premiums due or paid, together with
interest thereon at the current prime rate plus two percent
accruing from the date of such invoice until paid, which amount
shall be considered rent payable by Lessee in addition to the
Rental defined at Article 4 hereof.
(D) All policies of insurance provided for or contemplated
by this Article shall name Lessor and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, and
Lessee and any mortgagee as additional insured and loss payee, as
their respective interests may appear, and shall provide that the
policies cannot be canceled, changed, terminated, or modified in
a manner that materially affects the insurance required hereunder
without thirty (30) days written notice to the parties. All
insurance companies must have an A.M. Best rating of "Good" or
better. Lessee has provided Lessor with a legible copy of the
applicable insurance certificate(s) and will provide Lessor with
copies of any changes thereto and shall provide evidence no less
than thirty (30) days prior to the expiration thereof of the
renewal thereof and the renewal and existence of requisite public
liability insurance as by current Certificates of Insurance.
(E) Lessee shall defend, indemnify, and hold Lessor
harmless against any and all claims, damages, and lawsuits
arising after the Occupancy Date of this Lease and any orders,
decrees or judgments which may be entered therein, brought for
damages or alleged damages resulting from any injury to person or
property or from loss of life sustained in or about the Leased
Premises, and Lessee agrees to save Lessor harmless from, and
indemnify Lessor against, any and all injury, loss, or damage, of
whatever nature, to any person or property caused by, or
resulting from any act, omission, or negligence of Lessee or any
employee or agent of Lessee. In addition, Lessee hereby releases
Lessor from any and all liability for any loss or damage caused
by fire or any of the extended coverage casualties, even if such
fire or other casualty shall be brought about by the negligence
(but not the gross negligence or intentional or willful
misconduct or malice) of Lessor.
(F) Lessor hereby waives any and all rights that it may
have to recover from Lessee damages for any loss occurring to the
Leased Premises by reason of any act or omission of Lessee;
provided, however, that this waiver is limited to those losses
for which Lessor is compensated by its insurers. Lessee hereby
waives any and all right that it may have to recover from Lessor
damages for any loss occurring to the Leased Premises by reason
of any act or omission of Lessor; provided, however, that this
waiver is limited to those losses for which Lessee is compensated
by its insurers.
ARTICLE 6. TAXES, ASSESSMENTS AND UTILITIES
(A) Lessee shall be liable, and agrees to pay the charges
for, all public utility services rendered or furnished to the
Leased Premises, including heat, water, gas, electricity, sewer,
sewage treatment facilities and the like, all personal property
taxes, real estate taxes, special assessments, and municipal or
government charges, general, ordinary and extraordinary, of every
kind and nature whatsoever, which may be levied, imposed, or
assessed against the Leased Premises, or upon any improvements
thereon, at any time after the Occupancy Date of this Lease and
prior to the expiration of the term hereof, or any Renewal Term.
(B) Lessee shall pay all real estate taxes, assessments
for public improvements or benefits, and other governmental
impositions, duties, and charges of every kind and nature
whatsoever which shall or may, during the term of this Lease, be
charged, laid, levied, assessed, or imposed upon, or become a
lien or liens upon the Leased Premises or any part thereof or
upon the rents payable hereunder, except for taxes based solely
upon the income of Lessor. Such payments shall be considered as
rent paid by Lessee in addition to the Rent defined at Article 4
hereof. Lessee shall be deemed to have complied with the
foregoing covenant if payment is permitted without penalty or
interest, or before the same shall become a lien upon the Leased
Premises. If by law any real estate taxes, assessments for public
improvements or benefits, or other governmental impositions,
duties, and charges of every kind and nature whatsoever may at
the option of the taxpayer be paid in installments (whether or
not interest shall accrue on the unpaid balance), Lessee may
exercise the option to pay the same in installments and shall pay
such installments as they become due during the term of this
Lease. Lessee shall not be liable for installments which come due
after the termination date of the Lease. If due to a change in
the method of taxation, a franchise tax, rental tax, or income or
profit tax shall be levied against Lessor in substitution for or
in lieu of any tax which would otherwise constitute a real estate
tax, such tax shall be deemed a real estate tax for the purposes
herein and shall be paid by Lessee.
(C) All real estate taxes, assessments for public
improvements or benefits, water rates and charges, sewer rents,
and other governmental impositions, duties, and charges which
shall become payable for the first and last tax years of the term
hereof shall be apportioned pro rata between Lessor and Lessee in
accordance with the respective number of months during which each
party shall be in possession of the Leased Premises in said
respective tax years. For the purposes of this provision, all
personal property taxes, real estate taxes and special
assessments shall be deemed to have been assessed in the year
that the first payment or any installment thereof is due.
(D) Lessee shall have the right to contest or review by
legal proceedings or in such other manner as may be legal (which,
if instituted, shall be conducted solely at Lessee's own expense)
any tax, assessment for public improvements or benefits, or other
governmental imposition aforementioned, at any time until the
property is subject to levy or execution. All such proceedings
shall be begun as soon as reasonably possible after the
imposition or assessment of any contested items and shall be
prosecuted to final adjudication with reasonable dispatch. In the
event of any reduction, cancellation, or discharge, Lessee shall
pay the amount that shall be finally levied or assessed against
the Leased Premises or adjudicated to be due and payable, and, if
there shall be any refund payable by the governmental authority
with respect thereto, Lessee shall be entitled to receive and
retain the same, subject, however, to apportionment as provided
during the first and last years of the term of this Lease.
(E) Lessor, within sixty (60) days after notice to Lessee
if Lessee fails to commence such proceedings, may, but shall not
be obligated to, contest or review by legal proceedings, or in
such other manner as may be legal, and at Lessor's own expense,
any tax, assessments for public improvements and benefits, or
other governmental imposition aforementioned, which shall not be
contested or reviewed, as aforesaid, by Lessee, and unless Lessee
shall promptly join with Lessor in such contest or review, Lessor
shall be entitled to receive and retain any refund payable by the
governmental authority with respect thereto.
(F) Lessor shall not be required to join in any proceeding
referred to in this Article, unless in Lessee's reasonable
opinion, the provisions of any law, rule, or regulation at the
time in effect shall require that such a proceeding be brought by
and/or in the name of Lessor, in which event Lessor shall upon
written request, join in such proceedings or permit the same to
be brought in its name.
ARTICLE 7. ASSIGNMENT AND SUBLETTING
So long as Lessee shall remain fully liable for the
performance of all obligations of any lessee under this Lease,
and if Lessee provides notice and true and complete copies of all
assignments or sublet agreements to Lessor, then Lessee may
assign or sublet this Lease or the Premises without the prior
permission of Lessor.
Lessee shall, prior to the effective date thereof deliver to
Lessor executed counterparts of any such agreement and of all
ancillary agreements with the proposed assignee or sublessee, as
applicable. Lessor shall have the right to require all rental
payable to Lessee under any such subletting or assignment to be
payable to Lessor.
Notwithstanding the foregoing, Lessee shall have the right,
without prior consent of Lessor and without compliance with the
documentation requirements set forth in this Article, to license
the use of, or sublet, all or any portion the Leased Premises to
any person or organization for community, religious, or
educational meetings or other similar purposes, during non-
business hours of Lessee, and all rentals or license fees payable
to Lessee under any such licenses or subleases shall be retained
by Lessee.
ARTICLE 8. REPAIRS AND MAINTENANCE
(A) Lessee covenants and agrees to keep and maintain in
good order, condition and repair the interior and exterior of the
Leased Premises during the term of the Lease, and further agrees
that Lessor shall be under no obligation to make any repairs or
perform any maintenance to the Leased Premises. Lessee covenants
and agrees that it shall be responsible for all repairs,
alterations, replacements, or maintenance of the Leased Premises,
including but without limitation, interior and exterior portions
of all doors, door checks and operators, windows, plate glass,
plumbing, water and sewage facilities, fixtures, electrical
equipment, interior walls, ceilings, signs, interior building
appliances and similar equipment, heating and air conditioning
equipment, and further agrees to replace any of said equipment
when necessary based upon reasonable facility management
practices. Lessee further agrees to be responsible for, at its
own expense, snow removal, lawn maintenance, landscaping,
maintenance of the parking lot (including parking lines, seal
coating, and blacktop surfacing), and other similar items.
(B) If after written notice and a 90 day cure period
(except in the event of emergencies), Lessee refuses or neglects
to commence or complete repairs promptly and adequately, Lessor
may cause such repairs to be made, but shall not be required to
do so, and Lessee shall pay the cost thereof to Lessor upon
demand. It is understood that Lessee shall pay all expenses and
maintenance and repair during the term of this Lease. If Lessee
is not then in default hereunder, Lessee shall have the right to
make repairs and improvements to the Leased Premises without the
consent of Lessor if such repairs and improvements do not exceed
$50,000 provided such repairs or improvements do not affect the
structural integrity of the Leased Premises. Any repairs or
improvements in excess of $50,000 or affecting the structural
integrity of the Leased Premises may be done only with the prior
written consent of Lessor, such consent not to be unreasonably
withheld. All alterations and additions to the Leased Premises
shall be made in accordance with all applicable laws and shall
remain for the benefit of Lessor. Lessee further agrees, in the
event of making such alterations as herein provided, to indemnify
and save harmless Lessor from all expense, liens, claims or
damages to either persons or property or the Leased Premises
arising out of or resulting from the undertaking or making of
said repairs, improvements, alterations or additions, or Lessee's
failure to make repairs required by the terms of this Lease.
ARTICLE 9. COMPLIANCE WITH LAWS AND REGULATIONS
Lessee will materially comply with all statutes, ordinances,
rules, orders, regulations and requirements of all federal,
state, city and local governments, and with all rules, orders
and regulations of the applicable Board of Fire Underwriters
which affect the use of the improvements. Lessee will materially
comply with all easements, restrictions, and covenants of record
against or affecting the Leased Premises required for operation
of the Leased Premises in accordance with Article 14 hereof.
ARTICLE 10. SIGNS
Lessee shall have the right to install and maintain a sign
or signs advertising Lessee's business, provided that the signs
conform to law, and further provided that the sign or signs
conform specifically to the written requirements of the
appropriate governmental authorities.
ARTICLE 11. SUBORDINATION
(A) Lessor reserves the right and privilege to subject and
subordinate this Lease at all times to the lien of any mortgage
or mortgages now or hereafter placed upon Lessor's interest in
the Leased Premises and on the land and buildings of which said
premises are a part, or upon any buildings hereafter placed upon
the land of which the Leased Premises are a part, and to any and
all advances to be made under such mortgages, and all renewals,
modifications, extensions, consolidations, and replacements
thereof, provided such a mortgagee shall execute a reasonably
appropriate subordination, attornment and non-disturbance
agreement (which shall include the right to quiet enjoyment).
(B) Lessee covenants and agrees to execute and deliver,
upon demand, such further reasonable instrument or instruments
subordinating this Lease on the foregoing basis to the lien of
any such mortgage or mortgages as shall be desired by Lessor and
any mortgages or proposed mortgagees.
ARTICLE 12. CONDEMNATION OR EMINENT DOMAIN
(A) If the whole of the Leased Premises are taken by any
public authority under the power of eminent domain, or by private
purchase in lieu thereof, then this Lease shall automatically
terminate upon the date possession is surrendered, and Rent shall
be paid up to that day. If any part of the Leased Premises shall
be taken so as to reduce the licensed capacity of the Premises as
a daycare facility by more than 10%, then Lessee shall have the
right to terminate this Lease on thirty (30) days notice to
Lessor if given within ninety (90) days after the date of such
taking. In the event that this Lease shall terminate or be
terminated in accordance with this section, the Rent shall, if
and as necessary, be paid up to the day that possession of the
Leased Premises was surrendered.
(B) If any part of the Leased Premises shall be taken such
that it does not reduce the licensed capacity of the facility by
more than 10%, then Lessee shall, using proceeds of the award
from the taking authority, restore the remaining portion of the
Leased Premises to the extent necessary to render it satisfactory
to Lessee and reasonably suitable for the purposes for which it
was leased. Lessee shall make all repairs to the building in
which the Leased Premises is located to the extent necessary to
constitute the building a complete architectural unit, provided,
however, that such work shall not exceed the scope of the work
required to originally construct the building. Provided, further,
the cost thereof to Lessee shall not exceed the proceeds of its
condemnation award, all to be done without any adjustments in
rent to be paid by Lessee. Lessor agrees to make the condemnation
proceeds available to Lessee for restoration or repair pursuant
to this section.
Notwithstanding any provision in this Lease to the contrary,
if any award for any portion of the Premises appropriated or
taken under power of eminent domain, or otherwise, which taking
is deemed to be temporary, Lessee shall, except as stated in the
subsequent sentence, have exclusive and full rights to any such
award based upon such temporary taking, and Lessor agrees to
waive any right for such temporary taking. If pursuant to this
Lease Lessee terminates the Lease, then in such event any award
for temporary condemnation for a period of time after the
termination shall belong to Lessor. If in the event the
temporary taking is for a period of time that extends after the
end of the Term hereof, then Lessor shall be entitled to a pro-
rata amount of the temporary taking award based upon the amount
of time attributable to the period of time after the Term of the
Lease.
(C) Subject to Article 12(B) above, all compensation
awarded or paid upon such total or partial taking of the Leased
Premises shall belong to and be the property of Lessor without
any participation by Lessee, whether such damages shall be
awarded as compensation for diminution in value to the leasehold
or to the fee of the premises herein leased. Nothing contained
herein shall be construed to preclude Lessee from prosecuting any
claim directly against the condemning authority in such
proceedings for loss of business, damage to or cost of removal of
or for the value of stock, trade fixtures, furniture, and other
personal property belonging to Lessee; provided, however, that no
such claim shall diminish or otherwise adversely affect Lessor's
award or the award of any fee mortgagee. If a separate award
shall be made representing the difference between the value of
the leasehold estate and the fair market value of a comparable
leasehold estate, Lessee shall be entitled to the same; provided,
however, that Lessor shall be under no obligation to pursue such
award on behalf of Lessee
ARTICLE 13. RIGHT TO INSPECT
Lessor reserves the right to enter upon, inspect and examine
the Leased Premises at any time during business hours, and Lessee
agrees to allow Lessor free access to the Leased Premises to
show the premises upon a minimum of 48 hours prior notice to
Lessee. Lessor will not enter into the Leased Premises for
purposes of this section unless accompanied by a representative
of Lessee and Lessee does hereby agree to provide such
representative upon request by Lessor, such request given not
less than 48 hours in advance. Upon default by Lessee or at any
time within ninety (90) days of the expiration or termination of
the Lease, Lessee agrees to allow Lessor to then place "For Sale"
or "For Rent" signs on the Leased Premises.
ARTICLE 14. USE OF LEASED PREMISES
(A) Lessee agrees and warrants that the Leased Premises
will be used only for lawfully permitted uses which do not
diminish the value of the Leased Premises.
ARTICLE 15. DESTRUCTION OF PREMISES
(A) If, during the term of this Lease, the Leased Premises
are totally or partially destroyed by fire or the elements, so as
to render the premises wholly unfit for occupancy, or make it
impossible in the opinion of a licensed third party arbitrator
knowledgeable in the child care business reasonably acceptable
to Lessee and Lessor, for Lessee to conduct its business therein,
then either Lessor or Lessee shall have the right to terminate
this Lease from the date of such damage or destruction by giving
written notice. The parties agree to use reasonable promptness to
obtain the opinion of such licensed third party arbitrator. Upon
the giving of such notice, Lessee shall immediately surrender the
Leased Premises and all interest therein to Lessor, and in case
of any such termination, Lessor may re-enter and repossess the
Leased Premises and may dispossess all parties then in possession
thereof. If not otherwise terminated, in the event the Leased
Premises shall be repaired, restored, and rebuilt by Lessee with
the use of insurance proceeds (which Lessor shall cooperate to
make available), but otherwise at its own sole cost and expense,
within one hundred eighty (180) days from the date of destruction
(subject to force majuere as set forth in paragraph C hereof,
then all rents payable by Lessee shall be abated during the
period of repair and restoration to the extent Lessor shall be
compensated by the proceeds of rents loss insurance. In no event
shall Lessor be required to provide its own money for the repair
or restoration of the Leased Premises other than the net proceeds
of moneys received by it from any insurance policy or policies
covering such loss or damages. Lessee shall be liable for repair
of the Leased Premises with all reasonable speed, and the rents
shall recommence on the date that the repairs are completed.
Lessee shall be under no obligation to so repair during the last
five (5) years of the term of the Lease, or as extended, but if
Lessee shall desire to rebuild during the last 12 months of the
Lease term, Lessor will make insurance proceeds available to
rebuild the Leased Premises conditioned upon Lessee then
exercising its next renewal option under the Lease. Lessor will
make insurance proceeds available to rebuild the Leased Premises
in the event Lessee rebuilds, except as stated above.
(B) If the damage does not, in the opinion of a licensed
third party arbitrator reasonably acceptable to Lessee and
Lessor, render the Leased Premises unfit for occupancy, then
Lessor agrees that the damage shall be repaired as soon as
practicable and in that case, Lessee shall pay full rent during
the repair period. All repairs shall be paid for by Lessee out of
any insurance proceeds received (which Lessor shall cooperate to
make available), but if the insurance proceeds are insufficient
to rebuild or repair the Leased Premises according to the
original plans and specifications, whether repair or restoration
is commenced pursuant to paragraph A or B hereof, then Lessee
agrees to pay all additional amounts that are required to rebuild
the building in accordance with the original plans and
specifications. All improvements or betterments placed by Lessee
on the demised premises shall, however, in any event, be repaired
and replaced by Lessee at its own expense and not at the expense
of Lessor. The purpose of this Article is to require Lessee to
carry insurance coverage on the Leased Premises sufficient to
rebuild the improvements in the event of damage or destruction.
Lessee shall be under no obligation to so rebuild during the last
five (5) years of the term, as extended, as the case may be, but
if Lessee shall desire to rebuild during the last 12 months of
the Lease term, Lessor will make insurance proceeds available to
rebuild the Leased Premises conditioned upon Lessee then
exercising its next renewal option under the Lease. Lessor will
make insurance proceeds available to rebuild the Leased Premises
in the event Lessee rebuilds, except as stated above.
Risk that the insurance company shall be insolvent or shall
refuse to make insurance proceeds available shall be with Lessee.
The Leased Premises shall be so restored or rebuilt so as to be
of at least equal value and substantially the same character as
prior to such damage or destruction. If the insurance proceeds
are less than $100,000 they shall be paid to Lessee for such
repair and restoration. If the insurance proceeds are greater
than or equal to $100,000 they shall be deposited by Lessee and
Lessor into a customary construction escrow at a nationally
recognized title insurance company, or at Lessee's option, with
Lessor ("Escrowee") and shall be made available from time to time
to Lessee for such repair and restoration. Such proceeds shall be
disbursed in conformity with the terms and conditions of a
commercially reasonable construction loan agreement. Lessee
shall, in either instance, deliver to Lessor or Escrowee (as the
case may be) satisfactory evidence of the estimated cost of
completion together with such architect's certificates, waivers
of lien, contractor's sworn statements and other evidence of cost
and of payments as the Lessor or Escrowee may reasonably require
and approve. If the estimated cost of the work exceeds One
Hundred Thousand Dollars ($100,000), all plans and specifications
for such rebuilding or restoration shall be subject to the
reasonable approval of Lessor.
(C) Lessee shall comply with the time period stated above
for restoration of the Leased Premises as set forth in this
Article; provided, however, that said period of time shall be
extended for a period or periods of time equal to any period or
periods of delay caused by strikes, lockouts, fire, or other
casualty, the elements, acts of God, delay by or refusal or
failure of governmental authorities to grant necessary permits
and approvals for the reconstruction of the Leased Premises
(Lessee agreeing to use reasonable diligence to procure the
same), or other causes other than financial, beyond Lessee's
reasonable control or the reasonable control of Lessee's
contractor.
ARTICLE 16. ACTS OF DEFAULT
(A) Each of the following shall be deemed a default by
Lessee and a breach of this Lease:
1. Failure to pay the Rent, or any monetary
obligation herein reserved, (and to be considered to
be rent for the purposes of this Lease) or any part
thereof, within five (5) business days after written
notice from Lessor that the same shall be due and
payable. Provided, however, that interest and
penalties for failure to pay rent when due shall
accrue from the first date such rent was due and
payable.
2. Failure to do, observe, keep and perform
any of the material non-monetary terms, covenants,
conditions, agreements and provisions in this Lease
to be done, observed, kept and performed by Lessee
within 30 days after written notice of such default
(or within a reasonable time thereafter if the
default is incapable of cure within 30 days and
Lessee is diligently pursuing a reasonable course of
action to cure such default.
3. The abandonment (defined herein as the
leaving of the Leased Premises without paying rent,
without maintaining and without the intent of
returning) of the Premises by Lessee, the
adjudication of Lessee as a bankrupt, the making by
Lessee of a general assignment for the benefit of
creditors, the taking by Lessee of the benefit of
any insolvency act or law, the appointment of a
permanent receiver or trustee in bankruptcy for
Lessee property, or the appointment of a temporary
receiver which is not vacated or set aside within
sixty (60) days from the date of such appointment.
ARTICLE 17. TERMINATION FOR DEFAULT
In the event of any uncured default by Lessee and at any
time thereafter, Lessor may serve a written notice upon Lessee
that Lessor elects to terminate this Lease upon a specified date
not less than thirty (30) days after the date of serving such
notice of termination, and this Lease shall then terminate on the
date so specified, provided, however, that Lessee shall have
continuing liability for future rents for the remainder of the
original term and any exercised renewal term as set forth in
Article 19, notwithstanding any earlier termination of the Lease
hereunder, preserving unto Lessor the benefit of its bargained-
for rental payments.
ARTICLE 18. LESSOR'S RIGHT OF RE-ENTRY
In the event that this Lease shall be terminated as herein
provided, or by summary proceedings or otherwise, or in the event
of an uncured default hereunder by Lessee, or in the event that
the premises or any part thereof, shall be abandoned by Lessee,
(subject to rights to cure as provided in Article 16) Lessor or
its agents, servants or representatives, may immediately or at
any time thereafter, re-enter and resume possession of the
premises or any part thereof, and remove all persons and property
therefrom, in accordance with local law either by summary
dispossess proceedings or by a suitable action or proceeding at
law, without being liable for any damages therefor.
ARTICLE 19. LESSEE'S CONTINUING LIABILITY
(A) Should Lessor elect to re-enter as provided in this
Lease or should it take possession pursuant to legal proceedings
or pursuant to any notice provided for by law, it may either (i)
terminate this Lease or (ii) it may from time to time, without
terminating the contractual obligation of Lessee to pay Rent
under this Lease, make such commercially reasonable alterations
and repairs as may be necessary to relet the Leased Premises or
any part thereof for such Term or Renewal Terms, at such
commercially reasonable rental or rentals, and upon such other
commercially reasonable terms and conditions as Lessor in its
sole discretion may deem advisable.
(B) Upon each such reletting, without termination the
contractual obligation of Lessee to pay Rent under this
Lease, all rentals received by Lessor shall be applied as
follows:
1. First, to the payment of any indebtedness
other than rent due hereunder from Lessee to Lessor;
2. Second, to the payment of any commercially
reasonable costs and expenses of such reletting,
including brokerage fees and reasonable attorney's
fees and of costs of such alterations and repairs;
3. Third, to the payment of rent due and
unpaid hereunder;
4. The residue, if any, shall be held by
Lessor and applied in payment of future rent as the
same may become due and payable hereunder. Then any
residue will be used first to reimburse Lessor (or
Lessee if previously paid by Lessee for costs and
expenses per Article 19(B)2 above) for such costs and
expenses incurred per Article 19(B)2 above until
repaid, then any excess shall remain with Lessor.
If such rentals received from such reletting during any
month are less than that to be paid during that month by Lessee
hereunder, Lessee shall pay any such deficiency to Lessor. Such
deficiency shall be calculated and paid monthly. No such re-entry
or taking possession of such Leased Premises by Lessor shall be
construed as an election on its part to terminate this Lease
unless a written notice of such intention be given to Lessee.
(C) Notwithstanding any such reletting without
termination, Lessor may at any time thereafter elect to terminate
this Lease for any breach.
(D) In addition to any other remedies Lessor may have with
this Article 19, Lessor may recover from Lessee all damages it
may incur by reason of any breach, including the cost of
recovering and reletting the Leased Premises, reasonable
attorney's fees, and including the present value (discounted at a
rate of 8% per annum) of the excess of the amount of rent and
charges equivalent to rent reserved in this Lease for the
remainder of the Term over the then reasonable rental value of
the Leased Premises (or the actual rents receivable by Lessor, if
relet) for the remainder of the Term, all of which amounts shall
be immediately due and payable from Lessee to Lessor in full. In
determining the rent which would be payable by Lessee hereunder,
subsequent to default, the total Rental for each year of the
unexpired Term shall be equal to the average total Rental that
would be payable by Lessee as set forth in Article 4 above. In
the event that the rent obtained from such alternative or
substitute tenant is more than the rent which Lessee is obligated
to pay under this Lease, then such excess shall be paid to
Lessor provided that Lessor shall credit such excess against the
outstanding obligations of Lessee due pursuant hereto, if any.
(E) Lessor will use its reasonable efforts to mitigate its
damages, but Lessor shall have absolutely no obligation to expend
any moneys in the way of tenant inducements or in the
refurbishment of the Leased Premises for any use other than that
for which the Leased Premises were being used by Lessee. It is
the object and purpose of this Article 19 that Lessor shall be
kept whole and shall suffer no damage by way of non-payment of
rent or by way of diminution in rent, except as provided in
subsection (D) above. Lessee waives and will waive all rights to
trial by jury in any summary proceedings to recover possession of
the Leased Premises which may hereafter be instituted by Lessor.
ARTICLE 20. PERSONALTY, FIXTURES AND EQUIPMENT
(A) All building fixtures, building machinery, and
building equipment used in connection with the operation of the
Leased Premises including, but not limited to, heating, lighting,
ventilating, plumbing, walk-in refrigerators, walk-in freezers,
and air conditioning systems shall be the property of Lessor. All
trade fixtures and all other fixtures and articles of personal
property owned by Lessee shall remain the property of Lessee.
(B) Lessee shall furnish and pay for any and all
equipment, furniture, trade fixtures, and signs, except for such
items, if any, described in Article 20(A) above. Lessor agrees
that it has no interest in the personal property of Lessee.
(C) At the end of the term of this Lease, all personal
property and trade fixtures of Lessee may be removed from the
Leased Premises by Lessee, however, removal of such fixtures may
proceed only after five (5) business days prior written notice to
Lessor of the time of such removal and notice of the
identification of the parties performing such removal. All damage
to the Leased Premises which may be caused by the removal of such
property shall be promptly paid for by Lessee.
ARTICLE 21. LIENS
Lessee shall not do or cause anything to be done whereby the
Leased Premises may be encumbered by any mechanic's or other
liens. Whenever and as often as any mechanic's or other lien is
filed against said Leased Premises purporting to be for labor or
materials furnished or to be furnished to Lessee, within thirty
(30) days from the date of the filing of said mechanic's or other
lien (or such earlier period if required by law prevent default
or attachment of the lien) and delivery of notice thereof to
Lessee of Lessee's obligation under this Lease, Lessee shall
remove the lien of record by payment or by bonding with a surety
company authorized to do business in the state in which the
property is located, or other security reasonably acceptable to
Lessor. Should Lessee fail to take the foregoing steps within
said thirty (30) day period, then Lessor shall have the right,
among other things, to pay said lien without inquiring into the
validity thereof, and Lessee shall forthwith reimburse Lessor for
the total expense incurred by it in discharging said lien as
additional rent hereunder, subject to notice to Lessee and a 10
business day cure period.
ARTICLE 22. NO WAIVER BY LESSOR EXCEPT IN WRITING
No agreement to accept a surrender of the Leased Premises or
termination of this Lease shall be valid unless in writing signed
by Lessor. The delivery of keys to any employee of Lessor or
Lessor's agents shall not operate as a termination of the Lease
or a surrender of the premises. The failure of Lessor to seek
redress for violation of, any rule or regulation, shall not
prevent a subsequent act, which would have originally constituted
a violation, from having all the force and effect of an original
violation. No payment by Lessee or receipt by Lessor of a lesser
amount than the rent herein stipulated shall be deemed to be
other than on account of the earliest stipulated rent, nor shall
any endorsement or statement on any check nor any letter
accompanying any check or payment as rent be deemed an accord and
satisfaction, and Lessor may accept such check or payment without
prejudice to Lessor's right to recover the balance of such rent
or pursue any other remedy provided in this Lease. This Lease
contains the entire agreement between the parties, and any
executory agreement hereafter made shall be ineffective to
change, modify or discharge it in whole or in part unless such
executory agreement is in writing and signed by the party
against whom enforcement of the change, modification or
discharge is sought.
ARTICLE 23. QUIET ENJOYMENT
Lessor covenants that Lessee, upon paying the rent set forth
in Article 4 and all other sums herein reserved as rent and upon
the due performance of all the terms, covenants, conditions and
agreements herein contained on Lessee's part to be kept and
performed, shall have, hold and enjoy the Leased Premises free
from molestation, eviction, or disturbance by Lessor, or by any
other person or persons lawfully claiming the same, and that
Lessor has good right to make this Lease for the full term
granted, including renewal periods.
ARTICLE 24. BREACH - PAYMENT OF COSTS AND ATTORNEYS' FEES
The non-prevailing party agrees to pay and discharge all
reasonable costs, attorneys' fees and expenses that shall be
incurred by the prevailing party in enforcing the covenants,
conditions and terms of this Lease or defending against an
alleged breach.
ARTICLE 25. ESTOPPEL CERTIFICATES
Either party to this Lease will, at any time from time to
time, upon not less than ten (10) business days prior request by
the other party, execute, acknowledge and deliver to the
requesting party a statement in writing, executed by an executive
officer of such party, certifying (a) that this Lease is
unmodified (or if modified then disclosure of such modification
shall be made); (b) that this Lease is in full force and effect;
(c) that the date to which the rent and other charges have been
paid; and (d) that to the knowledge of the signer of such
certificate the other party is not in default in the performance
of any covenant, agreement or condition contained in this Lease,
or if a default does exist, specifying each such default of which
the signer may have knowledge. It is intended that any such
statement delivered pursuant to this Article may be relied upon
by any prospective purchaser or mortgagee of the Leased Premises
or any assignee of such mortgagee or a purchaser of the leasehold
estate.
ARTICLE 26. FINANCIAL STATEMENTS
Lessee will, within ninety (90) days after the end of
Lessee's fiscal year during the term of this Lease, furnish to
the Lessor financial statements of the Lessee. The financial
statements shall be certified by an officer of Lessee or if
financial statements are prepared by an independent certified
public accountant then such accountant's report shall be provided
and such report shall be prepared in conformity with generally
accepted accounting principals with accountant's opinion and
footnotes included therein. The financial statements shall
include a balance sheet, and related statement of income.
ARTICLE 27. MORTGAGE
Lessee does hereby agree to make reasonable modifications of
this Lease requested by any Mortgagee of record from time to time
provided such modifications are not material and do not increase
any of the rents or modify any of the business elements of this
Lease.
ARTICLE 28. OPTION TO RENEW
If this Lease is not previously canceled or terminated and
if Lessee is not then in material default hereunder, then Lessee
shall have three (3) separate individual options to renew this
Lease upon the same conditions and covenants contained in this
Lease for three separate individual (3) consecutive periods of
five (5) years each (singularly "Renewal Term").
The first Renewal Term would commence on the date the
original Term expires and successive Renewal Terms would commence
on the last day of the then expiring Renewal Term. Lessee must
give 90 days written notice to Lessor of its intent to exercise
this option prior to the expiration of the original Term of this
Lease or any Renewal Term, as the case may be.
The rent during the Renewal Term or Terms shall increase
each Fifth Lease Year of the Renewal Term at the same rate as set
forth in Article 4 above.
ARTICLE 29. MISCELLANEOUS PROVISIONS
(A) All written notices shall be given by certified mail
or a nationally recognized overnight or express courier. Notices
to Lessor shall be addressed to the person and address given on
the first page hereof. Lessor and Lessee may, from time to time,
change these addresses by notifying each other of this change in
writing.
(B) The terms, conditions and covenants contained in this
Lease and any riders and plans attached hereto shall bind and
inure to the benefit of Lessor and Lessee and their respective
successors, heirs, legal representatives, and assigns.
(C) This Lease shall be governed by and construed under
the laws of the State where the premises are situated.
(D) In the event that any provision of this Lease shall
be held invalid or unenforceable, no other provisions of this
Lease shall be affected by such holding, and all of the remaining
provisions of this Lease shall continue in full force and effect
pursuant to the terms hereof.
(E) The paragraph captions are inserted only for
convenience and reference, and are not intended, in any way, to
define, limit, describe the scope, intent, and language of this
Lease or its provisions.
(F) In the event Lessee remains in possession of the
premises herein leased after the expiration of this Lease and
without the execution of a new lease, it shall be deemed to be
occupying said premises as a tenant from month-to-month, subject
to all the conditions, provisions, and obligations of this Lease
insofar as the same can be applicable to a month-to-month tenancy
except that the monthly installment of Rental shall be increased
25% from the amount due on the last month prior to such
expiration.
(G) If any installment of rent (whether lump sum, monthly
installments, or any other monetary amounts required by this
Lease to be paid by Lessee and deemed to constitute Rental
hereunder) shall not be paid within 10 days when due, Lessor
shall have the right to charge Lessee a late charge of $250 per
month for unpaid rent for each month that any amount of rent
installment remains unpaid. Said late charge shall commence after
such installment is due and continue until said installment,
interest and all accrued late charges are paid in full.
(H) Any part of the Leased Premises may be conveyed by
Lessor for private easement purposes at any time provided Lessee
gives written consent to such private easement. In the event that
the private easement affects or is related to the playground or
the building on the Leased Premises, then Lessee's consent may be
arbitrarily withheld in Lessee's sole and absolute discretion. If
the private easement does not affect the playground or building
on the Leased Premises, then Lessee's consent may not be
commercially unreasonably withheld. In such event that any part
of the Leased Premises are so conveyed, Lessor shall, at its own
cost and expense, restore the remaining portion of the Leased
Premises to the extent necessary to render it reasonably suitable
for the purposes for which it was leased, all to be done without
adjustments in rent to be paid by Lessee. All proceeds from any
conveyance of a private easement shall belong solely to Lessor.
(I) For the purpose of this Lease, the term "rent" shall
be defined as Rental under Article 4, and any other monetary
amounts required by this Lease to be paid by Lessee.
ARTICLE 30. REMEDIES
NON-EXCLUSIVITY. Notwithstanding anything contained herein
it is the intent of the parties that the rights and remedies
contained herein shall not be exclusive but rather shall be
cumulative along with all of the rights and remedies of the
parties which they may have at law or equity.
ARTICLE 31. HAZARDOUS MATERIALS INDEMNITY
Lessee covenants, represents and warrants to Lessor, its
successors and assigns, (i) that except in the ordinary course of
business of conducting a day care facility and then only in
accordance with applicable law, rule, or regulation, Lessee has
not used or permitted the Leased Premises to be used for the
generating, transporting, treating, storage, manufacture,
emission of, or disposal of any dangerous, toxic or hazardous
pollutants, chemicals, wastes or substances as defined in the
Federal Comprehensive Environmental Response Compensation and
Liability Act of 1980 ("CERCLA"), the Federal Resource
Conservation and Recovery Act of 1976 ("RCRA"), or any other
federal, state or local environmental laws, statutes,
regulations, requirements and ordinances ("Hazardous Materials");
further, Lessee will not use or permit the Leased Premises to be
used during the Term of this Lease, whether directly or through
contractors, agents or tenants, for the generating, transporting,
treating, storage, manufacture, emission of, or disposal of any
Hazardous Materials, except in the ordinary course of conducting
a day care facility, and then only in accordance with applicable
law, rule or regulation; (ii) that there have been no
investigations or reports involving Lessee, or the Leased
Premises by any governmental authority which in any way pertain
to Hazardous Materials; (iii) that the operation of the Leased
Premises has not violated and is not currently violating any
federal, state or local law, regulation, ordinance or requirement
governing Hazardous Materials; (iv) that the Leased Premises is
not listed in the United States Environmental Protection Agency's
National Priorities List of Hazardous Waste Sites nor any other
list, schedule, log, inventory, or record of Hazardous Materials
or hazardous waste sites, whether maintained by the United States
Government or any state or local agency; and (v) that the Leased
Premises will not contain any formaldehyde, urea or asbestos,
except as may have been disclosed in writing to Lessor by Lessee
at the time of execution and delivery of this Lease. Lessee
agrees to indemnity and reimburse Lessor, its successors and
assigns, for:
(a) any breach of these representations and warranties,
and
(b) any loss, damage, expense or cost arising out of
or incurred by Lessor which is the result of a breach
of, misstatement of or misrepresentation of the above
covenants, representations and warranties, and
(c) any and all liability of any kind whatsoever which
Lessor may, for any cause and at any time, sustain or
incur by reason of Hazardous Materials, released or
placed on the Leased Premises during the term of the
Lease,
together with all reasonable attorneys' fees, costs and
disbursements incurred in connection with the defense of any
action against Lessor arising out of the above. These covenants,
representations and warranties shall be deemed continuing
covenants, representations and warranties for the benefit of
Lessor, and any successors and assigns of Lessor and shall
survive expiration or sooner termination of this Lease. The
amount of all such indemnified loss, damage, expense or cost,
shall bear interest thereon at the rate of interest equal to the
rate changed on overdue payment in Section 4(G) and shall become
immediately due and payable in full on demand of Lessor, its
successors and assigns.
ARTICLE 32. ESCROWS
If Lessee has defaulted in payment of any taxes, or if
Lessee shall be in default under any of the items of this Lease,
or if Lessor's Mortgagee shall require Lessor to escrow the
amount of real estate taxes or assessments on a monthly basis,
then in either event, at Lessor's option, Lessee shall deposit
with an escrow agent reasonably acceptable to Lessor and Lessee
on the first day of each and every month thereafter, an amount
equal to one-twelfth (1/12th) of the estimated annual real estate
taxes, assessments ("Charges") due on the Leased Premises. From
time to time out of such deposits Lessor will, upon the
presentation to Lessor by Lessee of the bills therefor, pay the
Charges or will upon presentation of receipted bills therefor,
reimburse Lessee for such payments made by Lessee. In the event
the deposits on hand shall not be sufficient to pay all of the
estimated Charges when the same shall become due from time to
time or the prior payments shall be less than the currently
estimated monthly amounts, then Lessee shall pay to Lessor on
demand any amount necessary to make up the deficiency. The excess
of any such deposits shall be credited to subsequent payments to
be made for such items. If a default or an event of default shall
occur under the terms of this Lease, Lessor may, at its option,
without being required so to do, apply any Deposit on hand to
cure the default, in such order and manner as Lessor may elect.
ARTICLE 33. NET LEASE
Notwithstanding anything contained herein to the contrary it
is the intent of the parties hereto that this Lease shall be a
net lease and that the rent defined pursuant to Paragraph 4
should be a net rent paid to Lessor. Any and all other expenses
including but not limited to, maintenance, repair, insurance,
taxes, and assessments, shall be paid by Lessee.
ARTICLE 34. RIGHT TO SUBSTITUTION
If Lessee determines that it is economically unfeasible to
continue operations in or at the Leased Premises, Lessee may
exchange the Leased Premises for another of like kind, value,
size and demographic location acceptable to Lessor. If Lessor
elects to accept a replacement property in exchange for the
Leased Premises owned by Lessor, Lessee shall provide a
replacement property of comparable size, cost, location and
ownership interest in a Section 1031 "like-kind" exchange and
shall lease the replacement Premises from Lessor on identical
terms as contained in the lease for the original Leased Premises.
All costs associated with making such exchange, including the
provision of surveys, title, environmental and all other
documentation normally required or obtained by Lessor, shall be
paid by Lessee.
IN WITNESS WHEREOF, Lessor and Lessee have respectively
signed and sealed this Lease as of the day and year first above
written.
LESSEE: ARAMARK EDUCATIONAL
RESOURCES, INC., dba CHILDREN'S
WORLD LEARNING CENTERS, INC., a
Delaware corporation
Attest: By: /s/ ▇▇▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇ Its: Executive Vice President
STATE OF COLORADO )
)SS.
COUNTY OF JEFFERSON )
The foregoing instrument was acknowledged before me this
29th day of March, 2001, by ▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇, the
Executive Vice President and Asst. Secretary of ARAMARK
EDUCATIONAL RESOURCES, INC., dba Children's World Learning
Centers, Inc., a Delaware corporation, on behalf of said
corporation.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Notary Public [notary seal]
LESSOR: AEI FUND MANAGEMENT XVII, INC.
Attest:
AEI FUND MANAGEMENT XVII, INC.
/s/ ▇▇▇ M Fauecht
By:/s/ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, Chief Financial Officer
STATE OF MINNESOTA )
)SS.
COUNTY OF ▇▇▇▇▇▇ )
The foregoing instrument was acknowledged before me the 30th
day of March, 2001, by ▇▇▇▇ ▇▇▇▇▇▇, the Chief Financial Officer
of AEI Fund Management XVII, Inc., a Minnesota corporation.
/s/ ▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇
Notary Public [notary seal]
EXHIBIT A
Legal Description
PARCEL 1: Those parts of the Northeast 1/4 and Southeast 1/4
both of the Southwest 1/4 of section 15, township 45 north, range
10, east of the third principal meridian, described as follows:
Beginning at the Northwest corner of the Southeast 1/4 of the
Southwest 1/4 of section 15, also being a north corner of lot 24
in Heatherwood Subdivision, recorded January 18, 1990 as document
2870681; thence South 49 degrees 02 minutes 42 seconds East along
the North line of said subdivision, a distance of 229.96 feet to
a point; thence North 40 degrees 50 minutes 18 seconds East a
distance of 12.60 feet to a point; thence Northwesterly along a
curved line concave to the Northwest having a radius of 133.66
feet, an arc length of 92.99 feet and a chord length of 91.13
feet bearing north 20 degrees 54 minutes 27 seconds east to a
point of tangency; thence north 00 degrees 58 minutes 36 seconds
East a distance of 145.21 feet to a point on the Southerly right
of way line of Illinois Route 83 , being a line 50 feet
Southwesterly of and parallel to the center line of said road;
thence north 49 degrees 05 minutes 00 seconds west along said
west line of the Northeast 1/4 of the Southwest 1/4 of section
15, aforesaid; thence south 00 degrees 03 minutes 44 seconds East
along the aforesaid line a distance of 277.38 feet to the point
of beginning, in Lake County Illinois.
PARCEL 2: Those parts of the Northeast 1/4 and the Southeast 1/4
both of the Southwest 1/4 of section 15, Township 45 North, Range
10 East of the third principal meridian, described as follows:
Commencing at the Northwest corner of the Southeast 1/4 of the
Southwest 1/4 of section 15, also being a North corner of lot 24
in Heatherwood subdivision, recorded January 18, 1990 as document
2870681; thence South 49 degrees 02 minutes 42 seconds East along
the North line of said subdivision, a distance of 256.96 feet to
the point of beginning of the parcel herein intended to be
described; thence continuing South 49 degrees 02 minutes 421
seconds East along the aforesaid line, a distance of 101.49 feet
to a point; thence north 01 degrees 08 minutes 29 seconds East, a
distance of 272.78 feet to a point on the Southerly right of way
line of Illinois Route 83, being a line 50.00 feet Southwesterly
and parallel to the center line of said road; then North 49
degrees 05 minutes 00 seconds west along said Southerly right of
way line a distance of 40.14 feet to a point Thence; Southerly
along a curved line concave to the Southeast having a radius of
20.00 feet, an arc length of 9.75 feet and a chord length of 9.66
feet bearing south 14 degrees 56 minutes 56 seconds West to a
point of tangency; Thence South 00 degrees 58 minutes 36 seconds
West a distance of 111.28 feet to a point of curvature; Thence
Southwesterly along a curved line concave to the Northwest having
a radius of 160.66 feet, an arc length of 111.77 feet and a chord
length of 109.53 feet bearing South 20 degrees 54 minutes 27
seconds west to a point of tangency; thence South 40 degrees 50
minutes 18 seconds West a distance of 12.66 feet to the point of
beginning, in Lake County, Illinois.