PROPERTY LEASE
▇▇▇▇▇▇▇ INCORPORATED, LANDLORD
QUALITY PRODUCTS, INC., TENANT
TABLE OF CONTENTS
1. Basic Definitions.......................................................................................................7
1.1 Premises....................................................................................................7
1.2 Term........................................................................................................7
1.3 Base Rent...................................................................................................7
1.4 Agreed Use..................................................................................................8
1.5 Exhibits....................................................................................................8
2. Grant of Lease..........................................................................................................8
2.1 Letting.....................................................................................................8
2.2 Condition...................................................................................................8
2.3 Environmental Assessments..................................................................................10
2.4 TENANT'S Engineering Inspection............................................................................11
3. Term ...........................................................................................................12
3.1 Term.......................................................................................................12
3.2 Delay In Possession........................................................................................12
3.3 TENANT Compliance..........................................................................................12
3.4 Term Extension or Renewal..................................................................................12
4. Rent ...........................................................................................................12
4.1 Rent Defined...............................................................................................12
4.2 Payment....................................................................................................12
5. (blank) ...........................................................................................................13
6. Use ...........................................................................................................13
6.1 Use........................................................................................................13
6.2 Certain Capital Expenditures...............................................................................14
6.3 Environmental Matters......................................................................................14
6.3.1 Definitions..........................................................................................14
6.3.1.1 Hazardous Material.........................................................................14
6.3.1.2 Environmental Requirements.................................................................15
6.3.1.3 Environmental Damages......................................................................15
6.3.2 TENANT'S Obligation to Indemnify, Defend and Hold Harmless...........................................16
6.3.3 TENANT'S Obligation to Remediate.....................................................................17
6.3.4 Notification.........................................................................................18
6.3.5 Negative Covenants...................................................................................18
6.3.5.1 No Hazardous Material on Premises..........................................................18
6.3.5.2 No Violations of Environmental Requirements................................................18
6.3.5.3 No Environmental or Other Liens............................................................19
6.3.6 LANDLORD'S Right to Inspect and to Audit TENANT'S Records............................................19
6.3.7 LANDLORD'S Right to Remediate........................................................................19
6.3.8 LANDLORD'S Obligation to Remediate...................................................................19
6.3.9 LANDLORD'S Obligation to Indemnify, Defend and Hold Harmless Concerning Environmental Matters........20
6.3.10 Survival of Environmental Obligations..............................................................20
6.4 TENANT'S Compliance with Applicable Requirements...........................................................20
6.5 Inspection; Compliance.....................................................................................21
7. Maintenance; Repairs, Utility Installations; Trade Fixtures and Alterations............................................21
7.1 TENANT'S Obligations.......................................................................................21
(a) In General.............................................................................................21
(b) Service Contracts......................................................................................22
(c) Failure to Perform.....................................................................................22
7.2 LANDLORD'S Obligations.....................................................................................22
7.3 Utility Installations; Trade Fixtures; Alterations.........................................................22
(a) Definitions............................................................................................22
(b) Consent................................................................................................23
(c) Liens; Bonds...........................................................................................23
7.4 Ownership; Removal; Surrender; and Restoration.............................................................24
(a) Ownership..............................................................................................24
(b) Removal................................................................................................24
(c) Surrender; Restoration.................................................................................24
8. Insurance; Indemnity...................................................................................................25
8.1 Payment For Insurance......................................................................................25
8.2 Liability Insurance........................................................................................25
(a) Carried By TENANT......................................................................................25
(b) Carried By LANDLORD....................................................................................26
8.3 Property Insurance-Building, Improvements and Rental Value.................................................26
(a) Building and Improvements..............................................................................26
(b) Rental Value...........................................................................................26
8.4 TENANT'S Property; Business Interruption Insurance; Other Coverage.........................................27
(a) Property Damage........................................................................................27
(b) Business Interruption..................................................................................27
(c) Worker's Compensation Coverage.........................................................................27
(d) Additional Coverage....................................................................................27
(e) No Representation of Adequate Coverage.................................................................27
8.5 Insurance Policies.........................................................................................27
8.6 Waiver of Subrogation......................................................................................28
8.7 Indemnity..................................................................................................28
8.8 Exemption of LANDLORD from Liability.......................................................................29
9. Damage or Destruction..................................................................................................29
9.1 Definitions................................................................................................29
(a) Premises Partial Damage................................................................................29
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(b) Premises Total Destruction.............................................................................29
(c) Insured Loss...........................................................................................29
(d) Replacement Cost.......................................................................................30
(e) Hazardous Material Condition...........................................................................30
9.2 Partial Damage-Insured Loss................................................................................30
9.3 Partial Damage-Uninsured Loss..............................................................................30
9.4 Total Destruction..........................................................................................31
9.5 Damage Near End of Term....................................................................................31
9.6 Abatement of Rent; TENANT'S Remedies.......................................................................31
(a) Abatement..............................................................................................31
(b) Remedies...............................................................................................32
9.7 Termination; Advance Payments..............................................................................32
9.8 Waive Statutes.............................................................................................32
9.9 Termination of Lease by Mortgage Holder's Election.........................................................32
10. Property Taxes.....................................................................................................32
10.1 Definition.................................................................................................32
10.2 Payment of Taxes...........................................................................................33
10.3 Joint Assessment...........................................................................................34
10.4 Personal Property Taxes Regarding TENANT'S Property........................................................34
10.5 Taxes on LANDLORD'S Personal Property......................................................................34
10.6 Survival of Property Tax Provisions........................................................................34
11. Utilities and Services................................................................................................34
12. Assignment and Subletting.............................................................................................35
12.1 LANDLORD'S Consent Required........................................................................................35
12.2 Terms and Conditions Applicable to Assignment and Subletting...............................................35
12.3 Additional Terms and Conditions Applicable to Subletting...................................................36
13. Default; Remedies.....................................................................................................37
13.1 Default....................................................................................................37
13.2 Remedies...................................................................................................38
13.3 Late Charges...............................................................................................39
13.4 Interest...................................................................................................40
13.5 Breach by LANDLORD.........................................................................................40
(a) Notice of Breach.......................................................................................40
(b) Performance by TENANT on Behalf of LANDLORD............................................................40
14. Condemnation..........................................................................................................40
15. Representations and Indemnities of Broker Relationships...............................................................41
16. Estoppel Certificate..................................................................................................41
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17. Definition of LANDLORD...............................................................................................42
18. Severability.........................................................................................................42
19. Days ...........................................................................................................42
20. Limitation on Liability..............................................................................................42
21. Time of Essence......................................................................................................42
22. No Prior or Other Agreements.........................................................................................42
23. Notices ...........................................................................................................42
23.1 Notice Requirements........................................................................................42
23.2 Date of Notice.............................................................................................43
24. Waivers ...........................................................................................................43
25. Survival of Obligations..............................................................................................43
26. No Right To Holdover.................................................................................................43
27. Cumulative Remedies..................................................................................................44
28. Covenants and Conditions; Construction of Agreement..................................................................44
29. Binding Effect; Choice of Law........................................................................................44
30. Subordination; Attornment; Non-Disturbance...........................................................................44
30.1 Subordination..............................................................................................44
30.2 Attornment.................................................................................................44
30.3 Non-Disturbance............................................................................................45
30.4 Self-Executing.............................................................................................45
31. Attorneys Fees.......................................................................................................45
32. LANDLORD'S Access; Showing Premises; Repairs.........................................................................45
33. Auctions ...........................................................................................................46
34. Signs ...........................................................................................................46
35. Termination; Merger..................................................................................................46
36. Consents ...........................................................................................................46
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37. (blank) ...........................................................................................................46
38. Quiet Possession......................................................................................................47
39. (blank) ...........................................................................................................47
40. (blank) ...........................................................................................................47
41. Security Measures.....................................................................................................47
42. Reservations..........................................................................................................47
43. Performance Under Protest.............................................................................................47
44. Authority; Multiple Parties; Execution................................................................................47
45. Conflict ...........................................................................................................48
46. Not An Offer..........................................................................................................48
47. Amendments............................................................................................................48
48. Waiver of Jury Trial..................................................................................................48
49. (blank) ...........................................................................................................48
50. Americans with Disabilities Act.......................................................................................48
51. TENANT'S Right to Purchase............................................................................................48
51.1 LANDLORD Must Offer Premises to TENANT.....................................................................48
51.2 No Right if Default, Assignment, or Sublet.................................................................49
51.3 TENANT'S Obligation if Right Exercised.....................................................................49
51.4 Certain Transfers Excluded.................................................................................49
51.5 TENANT Reject Rights.......................................................................................49
51.6 TENANT Gets Additional Right of First Offer................................................................50
51.7 Right Terminates After Sale to Third Party.................................................................50
51.8 Definitions................................................................................................50
51.9 Termination of Lease.......................................................................................50
51.10 Termination of Evidence....................................................................................50
52. Net Lease.............................................................................................................50
53. Recording.............................................................................................................50
54. TENANT'S Option to Purchase Certain Personal Property.................................................................51
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55. Security Interest.....................................................................................................51
55.1 Option Personal Property Security Interest.................................................................51
55.2 Other Personal Property Security Interest..................................................................52
56. Power of Attorney.....................................................................................................52
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PROPERTY LEASE
(WITH RIGHT OF REFUSAL TO PURCHASE)
THIS
PROPERTY LEASE ("Lease") is entered into this 24th day of May,
2002, by ▇▇▇▇▇▇▇ Incorporated, an Ohio corporation ("LANDLORD") and Quality
Products, Inc., a Delaware corporation ("TENANT"). (LANDLORD and TENANT are
sometimes referred to herein collectively as the "Parties," or individually as a
"Party".)
In consideration of the covenants, terms, conditions, agreements, and
payments as hereinafter set forth, the parties hereto agree as follows:
1. BASIC DEFINITIONS.
The following terms used in this Lease have the indicated meanings:
1.1 PREMISES. That certain real property, including the land and the
building and other improvements, and any fixtures, equipment and facilities
located therein or thereon as of the Commencement Date which are utilized or
necessary in connection with the operation of the building located on said land
including, for example, heating, ventilating and air conditioning systems
("HVAC"), plumbing, electrical, lighting facilities, boilers, pressure vessels,
and fire protection systems, said premises being commonly known as ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, and being located in the County of Franklin
and State of Ohio, and further described in Exhibit 1.1(A) attached hereto and
incorporated herein, plus certain additional property specifically identified in
Exhibit 1.1(B) ("Personal Property"). The Parties acknowledge and agree that the
Premises will not include the equipment and machinery that is being leased by
LANDLORD to TENANT pursuant to that certain separate Lease Agreement between
LANDLORD and TENANT and dated of even date herewith and also will not include
certain property that is specifically marked or designated by LANDLORD as being
excluded.
1.2 TERM. The period of five (5) years commencing August 1, 2002
("Commencement Date") and ending July 31, 2007 ("Expiration Date") unless
postponed, accelerated or extended as hereinafter provided (sometimes referred
to herein as "Term" or "term"). (See also Paragraph 3)
1.3 BASE RENT. The Base Rent for the full initial five (5) year Term
of this Lease shall be $800,000.00 which shall be payable in monthly
installments of $13,333.33 each, without demand, in advance, and due on the 1st
day of each month during the term hereof, commencing August 1, 2002, except that
the monthly installment of Base Rent due July 1, 2007 shall be $13,333.53. (See
also Paragraph 4)
The Parties hereby agree that the portion of the Base Rent that is
allocable to that portion of the Personal Property, the leasing of which under
this Lease is taxable for sales tax purposes,
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is $6,000.00 for the initial five (5) year Term of this Lease, or $100.00 per
month. (TENANT shall provide to LANDLORD not later than when this Lease is
executed by the Parties and at such other times as LANDLORD may require, a duly
completed sales tax unit exemption certificate(s) for any Personal Property, the
rental of which pursuant to this Lease qualifies for exemption from sales tax.)
1.4 AGREED USE: Manufacturing purposes, distribution and related
office uses. (See also Paragraph 6)
1.5 EXHIBITS. The attachments referred to in this Lease, all of
which constitute a part of this Lease, which include the following:
(a) Exhibit 1.1(A)-Premises Legal Description
(b) Exhibit l.1(B)-List of Personal Property
(c) Exhibit 53-Memorandum of Lease
(d) Exhibit 54-Option Personal Property
2. GRANT OF LEASE
2.1 LETTING. LANDLORD hereby leases to TENANT, and TENANT hereby
leases from LANDLORD, the Premises for the Term, at the rental, and upon all the
terms, covenants and conditions set forth in this Lease. Unless otherwise
provided herein, any statement of size set forth in this Lease, or that may have
been used in calculating Rent (hereinafter defined), is an approximation which
the Parties agree is reasonable and any payments based thereon are not subject
to revision whether or not the actual size is more or less.
2.2 CONDITION. Subject to the terms of Section 2.3 and 2.4 below,
TENANT acknowledges and agrees that: (a) it has been advised by LANDLORD to
satisfy itself with respect to the condition of the Premises (including but not
limited to the structure, roof, electrical, HVAC and fire sprinkler systems,
security, and environmental aspects) and compliance by the Premises with the
building codes, applicable law (including, for example, the Americans with
Disabilities Act), covenants, conditions, easements, restrictions and other
matters of record, regulations, and ordinances (collectively, "Applicable
Requirements") and their suitability for TENANT'S intended use, (b) TENANT has
made such investigation as it deems necessary with reference to such matters and
assumes all responsibility therefor as the same relate to its occupancy of the
Premises, except as otherwise provided in this Lease, and (c) neither LANDLORD
nor LANDLORD'S agents have made any oral or written representations or
warranties with respect to said matters other than as set forth in this Lease.
TENANT acknowledges and agrees that except to the extent specifically provided
otherwise in this Lease, TENANT accepts the Premises, including but not limited
to the land, buildings, improvements, fixtures and any other property that
comprises the Premises, in their condition, "AS IS," WITH ALL FAULTS as of the
Commencement Date or the date possession of the Premises is actually delivered
to TENANT, whichever date is later.
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IN ADDITION, EXCEPT AS SET FORTH BELOW IN THIS PARAGRAPH 2.2, LANDLORD MAKES NO
WARRANTY OR REPRESENTATION (EITHER EXPRESS OR IMPLIED) TO TENANT AS TO THE
FITNESS FOR A PARTICULAR PURPOSE, QUALITY, DESIGN, CONDITION, CAPACITY, SAFETY,
SUITABILITY, MERCHANTABILITY OR PERFORMANCE OF THE PERSONAL PROPERTY (INCLUDING
ITS CONFORMITY WITH APPLICABLE LAW AND REGULATIONS), TITLE TO THE PERSONAL
PROPERTY, OR ANY OTHER MATTER WHATSOEVER. TENANT AGREES THAT THE PERSONAL
PROPERTY IS LEASED "AS IS" AND "WHERE IS" AND THAT ALL RISKS REGARDING THE
PERSONAL PROPERTY ARE TO BE BORNE SOLELY BY TENANT INCLUDING, WITHOUT
LIMITATION, ANY LOSSES OR DAMAGES DUE TO ACTS OF GOD, STRIKES, GOVERNMENTAL
ACTION OR OBSOLESCENCE. LANDLORD SHALL NOT BE LIABLE TO TENANT OR ANY OTHER
PARTY FOR ANY CLAIM OR MATTER PERTAINING TO THE PERSONAL PROPERTY WHATSOEVER
INCLUDING, WITHOUT LIMITATION, ANY LOSS OR DAMAGE (DIRECT, INDIRECT OR
CONSEQUENTIAL) FROM BUSINESS INTERRUPTION, LOSS OF PROFITS, NONDELIVERY OR LATE
DELIVERY OF THE PERSONAL PROPERTY, IMPROPER INSTALLATION OR DESIGN OF THE
PERSONAL PROPERTY, FAILURE OR IMPROPER OPERATION OF THE PERSONAL PROPERTY,
BREACH OF ANY WARRANTY OR REPRESENTATION MADE BY THE MANUFACTURER OF THE
PERSONAL PROPERTY, OR ANY INJURY TO PERSONS OR PROPERTY. LANDLORD IS NOT A
MANUFACTURER OR SUPPLIER OF, NOR DOES LANDLORD ENDORSE, ANY ITEM OF THE PROPERTY
INCLUDED IN THE PREMISES, AND LANDLORD IS NOT BOUND BY ANY PROMISES MADE BY ANY
MANUFACTURER, SUPPLIER, OR DISTRIBUTOR OF THE PROPERTY INCLUDED IN THE PREMISES.
LANDLORD IS NOT OBLIGED TO ENFORCE WARRANTIES AND LICENSES MADE BY THE
MANUFACTURER OF THE PROPERTY INCLUDED IN THE PREMISES.
To the extent assignable by LANDLORD, all warranties and licenses made
by the manufacturer of the Personal Property are hereby assigned to TENANT for
the lease term. At TENANT'S sole expense and in TENANT'S own name only, LANDLORD
hereby authorizes TENANT to enforce any such warranties or licenses made with
respect to the Personal Property upon written notice to LANDLORD; and LANDLORD
is under no obligation to enforce any warranties or license regarding the
Personal Property. Notwithstanding the foregoing, TENANT shall not commence any
legal proceedings to enforce any warranty or license except upon the prior
written consent of LANDLORD (which consent shall not be unreasonably withheld).
LANDLORD makes no representations or warranties as to the existence, sufficiency
or enforceability of any warranties or licenses regarding the Personal Property;
and TENANT'S sole remedy for any defect in or nonconformity of the Personal
Property is against the manufacturer thereof.
LANDLORD represents and warrants to TENANT that, as of the date of this
Lease, the Premises are zoned "M-manufacturing", as such term is defined in the
City of Columbus Zoning Code.
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2.3 ENVIRONMENTAL ASSESSMENTS.
(a) LANDLORD, at LANDLORD'S expense, will cause to be
conducted before the Commencement Date an environmental site assessment of the
Premises ("Initial Baseline Assessment") by a qualified environmental
engineering consulting firm to test for the presence of such Hazardous Materials
(as defined in Paragraph 6.3.1.1 hereof) as LANDLORD may select in the soil or
groundwater on and under the Premises. A copy of the report setting forth the
results of the Initial Baseline Assessment will be provided to TENANT before the
Commencement Date, and shall name TENANT as a beneficiary thereof. If the
Initial Baseline Assessment reveals the presence of Hazardous Materials,
LANDLORD may conduct such additional testing, studies, and investigations
("Additional Baseline Assessments") as LANDLORD reasonably deems necessary, and
will provide a copy of the report setting forth the results of the Additional
Baseline Assessments to TENANT before the Commencement Date. If the Initial
Baseline Assessment or the Additional Baseline Assessments are unacceptable to
TENANT or LANDLORD, either party may give written notice of termination of this
Lease to the other party before the Commencement Date. If neither party
terminates this Lease under this paragraph, then this Lease shall continue in
force and effect. (The Initial Baseline Assessment and Additional Baseline
Assessments are sometimes collectively referred to herein as the "Baseline
Assessments.")
(b) At such time as LANDLORD directs, but not earlier than
6 months prior to the end of the Term of this Lease and not later than 30 days
after the end of the Term of this Lease, TENANT, at its expense, will cause to
be conducted a final environmental site assessment of the Premises ("Initial
Final Assessment") to determine the environmental condition of the Premises.
Said assessment shall include such investigations as are acceptable to LANDLORD
in the exercise of its commercially reasonable discretion, and shall be
conducted by an environmental consulting firm reasonably acceptable to LANDLORD.
TENANT shall give LANDLORD ten (10) days written notice before performing any
such tests so that LANDLORD may have the opportunity to be present and to split
test samples.
If the Initial Final Assessment reveals the presence of additional
Hazardous Materials or Hazardous Materials in concentrations greater than were
found in the Baseline Assessments, TENANT, at TENANT'S expense, will conduct
such additional testing, studies, and investigations ("Additional Final
Assessments") as LANDLORD reasonably deems necessary, and will provide a copy of
the report setting forth the results of the Additional Final Assessments to
LANDLORD. If the Initial Final Assessment or Additional Final Assessments
disclose any Hazardous Material that was not disclosed by the Baseline
Assessments or if they disclose higher concentrations of Hazardous Materials
than were found in the Baseline Assessments, then TENANT shall remediate the
Premises in accordance with Paragraph 6.3 hereof. (The Initial Final Assessment
and Additional Final Assessments are sometimes collectively referred to herein
as the "Final Assessments".) Any tests by or for TENANT shall be conducted in a
manner so as not to permanently or materially damage the Premises or interfere
with LANDLORD'S use of or operations on the Premises. If any damage is caused to
the Premises, TENANT shall immediately repair and restore the Premises to their
former condition. TENANT shall be responsible to LANDLORD for and, in addition
to and not in limitation of any other
10
indemnification and other obligations of TENANT under this Lease, shall
indemnify, defend, and hold harmless LANDLORD its successors and assigns, from
and against any and all losses, claims, damages, liabilities and causes of
action for personal injury or property damage or loss to persons or property
(including reasonable attorneys fees) arising from such entry, use, or occupancy
of the Premises. This indemnity shall survive any termination of this Lease.
TENANT shall furnish LANDLORD with a copy of each report setting forth the
results of any test performed by or for TENANT within ten (10) days after
receipt. TENANT shall not submit a copy of any such report to any governmental
agency unless specifically required by applicable law; and if so required,
TENANT shall simultaneously provide to LANDLORD a copy of any information
submitted to such agency.
(c) Unless LANDLORD specifically and expressly otherwise
agrees in writing, TENANT agrees that all information regarding the Premises
made available to it by LANDLORD or LANDLORD'S agents or representatives or
discovered by TENANT in the course of the performance of the inspections and/or
any environmental site assessment referred to in this Lease is confidential and
shall not be disclosed to any other person without LANDLORD'S prior written
consent absent court subpoena to the contrary. The provisions of this Paragraph
2.3 shall survive any termination of the Term of this Lease.
2.4 TENANT'S ENGINEERING INSPECTION. Within thirty (30) days after
the date of this Lease, TENANT, at its own expense and after giving reasonable
notice to LANDLORD, shall have the right to cause an engineering inspection of
the Premises to be conducted by a qualified engineer(s) licensed in Ohio (the
"Engineer"), TENANT shall cause the Engineer to promptly submit a detailed
written report to LANDLORD which shall detail any reasonable repairs which
TENANT believes should be made to the Premises for them to be considered in
condition reasonably satisfactory to TENANT for its Agreed Use of the Premises.
LANDLORD shall have the right, but not the obligation, to repair such defects.
If LANDLORD elects not to perform such repairs, or fails to substantially
complete such repairs to TENANT'S reasonable satisfaction prior to the
Commencement Date, TENANT shall, by the Commencement Date, as its sole remedy,
either elect to (a) terminate this Lease, or (b) accept the Premises in their
existing condition, without any reduction in the Rent, and the Lease shall
continue in force and effect. Such access shall be for the limited purpose of
conducting such inspection and shall be otherwise governed by the terms,
conditions, and requirements of this Lease (including, but not limited to, the
indemnity and insurance requirements of TENANT hereunder), excepting the
obligation to pay Rent until the occurrence of the Commencement Date.
Prior to TENANT obtaining any access to the Premises for purposes of its
inspection under this Paragraph 2.4, TENANT shall have delivered to LANDLORD
certificates of insurance in form and content reasonably acceptable to LANDLORD
or certified copies of policies of such insurance, all in accordance with
Paragraph 8.5 hereof, confirming that TENANT has in force the insurance required
by Paragraph 8.2(a) of this Lease. TENANT'S or its agents' entry into the
Premises prior to the Commencement Date shall be at TENANT'S risk.
TENANT shall use all reasonable efforts to avoid damage to any property.
After all such tests and inspections, TENANT shall promptly restore the Premises
to their condition on the date
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of this Lease including, but not limited to, filling all bored holes, and
TENANT'S agreement to restore the Property shall survive any termination of this
Lease.
3. TERM.
3.1 TERM. The Commencement Date, Expiration Date and Term of this
Lease are as specified in Paragraph 1.2.
3.2 DELAY IN POSSESSION. LANDLORD agrees to use commercially
reasonable efforts to deliver possession of the Premises to TENANT by the
Commencement Date. If, despite said efforts, LANDLORD is unable to deliver
possession by such date, LANDLORD shall not be subject to any liability
therefor, nor shall such failure affect the validity of this Lease. TENANT shall
not, however, be obligated to pay Rent or perform its other obligations until
LANDLORD delivers possession of the Premises. If possession is not delivered
within 60 days after the Commencement Date, TENANT may, at its option, by notice
in writing within 10 days after the end of such 60 day period, cancel this
Lease, in which event the Parties shall be discharged from all obligations
hereunder, except as otherwise provided herein. If such written notice is not
received by LANDLORD within said 10 day period, TENANT'S right to cancel shall
terminate. If possession of the Premises is not delivered within 120 days after
the Commencement Date, this Lease shall terminate unless other agreements are
reached between LANDLORD and TENANT, in writing.
3.3 TENANT COMPLIANCE. LANDLORD shall not be required to deliver
possession of the Premises to TENANT until TENANT complies with its obligation
to provide evidence of insurance (Paragraph 8.5). Pending delivery of such
evidence, TENANT shall be required to perform all of its obligations under this
Lease from and after the Commencement Date, including the payment of Rent.
3.4 TERM EXTENSION OR RENEWAL. Provided TENANT is not in Default
(hereinafter defined) under this Lease, TENANT shall have the right to request,
but not require, the extension or renewal of the Term of this Lease for a period
of five (5) additional years, commencing immediately upon expiration of the
initial Term of this Lease. If TENANT desires to request such extension or
renewal, TENANT shall so notify LANDLORD not later than six (6) months prior to
the end of the initial Term.
4. RENT.
4.1. RENT DEFINED. All monetary obligations of TENANT to LANDLORD
under the terms of this Lease are deemed to be rent ("Rent").
4.2 PAYMENT. TENANT shall cause payment of Rent to be received by
LANDLORD in lawful money of the United States on or before the day on which it
is due, without offset or deduction (except as specifically permitted in this
Lease). TENANT shall pay the Rent to LANDLORD by direct deposit to such account
of LANDLORD as LANDLORD may identify in writing from time to time, or by such
other method or to such other location as LANDLORD
12
may from time to time designate in writing. Rent for any period during the Term
hereof which is for less than one full calendar month shall be prorated based
upon the actual number of days of said month. Acceptance of a payment which is
less than the amount then due shall not be a waiver of LANDLORD'S rights to the
balance of such Rent, regardless of LANDLORD'S endorsement of any check so
stating. If any check, draft, or other instrument of payment given by TENANT to
LANDLORD is dishonored for any reason, TENANT agrees to pay to LANDLORD the sum
of $25 in addition to any Late Charge (hereinafter defined) and LANDLORD, at its
option, may require all future payments to be made by TENANT to be by cashier's
check. Payments will be applied first to accrued late charges and attorney's
fees, second to accrued interest, then to Base Rent and any remaining amount to
any other outstanding charges or costs.
5. [Intentionally Left Blank]
6. USE.
6.1 USE. TENANT shall use and occupy the Premises only for the
Agreed Use, and for no other purpose. TENANT shall not use or permit the use of
the Premises in a manner that is unlawful, creates damage, waste or a nuisance,
or that disturbs occupants of or causes damage to neighboring premises or
properties. LANDLORD shall not unreasonably withhold or delay its consent to any
written request for a modification of the Agreed Use, so long as the same will
not impair the structural integrity of the improvements on the Premises or the
mechanical or electrical systems therein, and/or is not significantly burdensome
to the Premises. If LANDLORD elects to withhold consent, LANDLORD shall within 7
days after such request give written notification of same, which notice shall
include an explanation of LANDLORD'S objections to the change in the Agreed Use.
6.1.1 TENANT also agrees as set forth in this Paragraph 6.1.1
regarding the Personal Property and Premises. TENANT shall use the Personal
Property within its recommended capacities and only for the purpose(s) for which
it was designed. TENANT shall comply with all laws, regulations and ordinances
relating to the possession and use of the Personal Property including, without
limitation, job safety, health, fire and environmental laws applicable to the
Personal Property ("Safety Laws"). At TENANT'S expense, TENANT shall maintain
the Personal Property in good repair and working order, and shall promptly
provide all parts, upgrades, modifications, environments and software required
or recommended now and hereafter ("Required Modifications") by the manufacturer
and supplier of the Personal Property ("Manufacturer") at TENANT'S own expense.
LANDLORD shall have no obligation to deliver, install, test, adjust, maintain or
service the Personal Property or provide substitute or replacement Personal
Property; and TENANT shall arrange for and bear the full cost of all such
matters. As used herein, "Manufacturer Requirements" shall include all
servicing, modifications and improvements recommended in any manuals, service
bulletins and other publications from the Manufacturer now or hereafter as
revised or supplemented. During the term hereof, a complete and accurate record
of all maintenance, servicing, Required Modifications and Permitted
Modifications (as defined below) to the Personal Property will be maintained by
TENANT (the "Service Records"), and the originals of such Service Records shall
be LANDLORD'S property.
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Upon request during the term hereof, TENANT shall allow LANDLORD to examine and
copy the Service Records. TENANT shall not move, or permit to be moved, from the
Premises, at time, any of the Personal Property or any other property comprising
the Premises.
Without the prior written consent of LANDLORD and except for Required
Modifications, TENANT shall not make any other modifications, additions or
improvements to the Personal Property unless such modifications do not: (i)
impair the originally intended function, capabilities, specifications and
performance of any unit of Personal Property; (ii) impair any maintenance
agreement(s), warranties or licenses with respect to any unit of Personal
Property; (iii) violate any Manufacturer Requirements; (iv) adversely affect the
Personal Property's resale value; or (v) cause any damage to any unit of
Personal Property upon removal; in each case, as determined by LANDLORD
("Permitted Modifications"). TENANT also grants LANDLORD a right of first
refusal as to the lease of any Permitted Modifications. TENANT shall remove all
Permitted Modifications upon return of the Personal Property without damage to
the Personal Property and so as to cause the Personal Property to comply with
all Safety Laws and with all Manufacturer Requirements then in effect. All
Permitted Modifications and any other accessories attached to the Personal
Property not so removed upon return of the Personal Property shall be deemed the
sole property of LANDLORD.
6.2 CERTAIN CAPITAL EXPENDITURES. If the construction of any
addition to or alteration of the Premises or the remediation of any Hazardous
Material or the reinforcement or other physical modification of any of the
Premises or other capital expenditures ("Capital Expenditure") are triggered by
TENANT as a result of an actual or proposed change in use, change in intensity
of use, or modification to the Premises, then TENANT shall either: (i)
immediately cease such changed use or intensity of use and/or take such other
steps as may be necessary to eliminate the requirement for such Capital
Expenditure, or (ii) subject to the requirements of Paragraph 7 (Maintenance,
Repairs, Utility Installations; Trade Fixtures and Alterations), complete such
Capital Expenditure at its own expense. TENANT shall not, however, have any
right to terminate this Lease.
6.3 ENVIRONMENTAL MATTERS.
6.3.1 DEFINITIONS.
6.3.1.1 HAZARDOUS MATERIAL. "Hazardous Material" means any
substance:
(a) the presence of which requires investigation, notice or
remediation under any federal, state or local statute,
regulation, ordinance, order, action, policy or common law; or
(b) which is or becomes defined as a "hazardous material,"
"hazardous waste," "hazardous substance," "regulated substance,"
"pollutant" or "contaminant" under any federal, state or local
statute, regulation, rule or ordinance or amendments thereto
including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act (42 U.S.C. (S)9601 et
seq.), Toxic
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Substances Control Act (15 U.S.C. (S)260l et seq.), and/or the
Resource Conservation and Recovery Act (42 U.S.C. (S)690l et
seq.); or
(c) which is toxic, explosive, corrosive, flammable, infectious,
radioactive, carcinogenic, mutagenic, or otherwise hazardous and
is or becomes regulated by any governmental authority, agency,
department, commission, board, agency or instrumentality of the
United States, or of the State in which the Premises are located
or any political subdivision thereof; or
(d) the presence of which on the Premises causes or threatens to
cause a nuisance upon the premises or to adjacent properties or
poses or threatens to pose a hazard to the health or safety of
persons on or about the Premises; or
(e) which contains gasoline, diesel fuel or other petroleum
hydrocarbons other than motor vehicle fuel tanks; or
(f) which contains polychlorinated biphenyls (PCBs) in
concentrations above 50 ppm., friable asbestos or unencapsulated
urea formaldehyde foam insulation; or
(g) which contains or is radon gas.
6.3.1.2 ENVIRONMENTAL REQUIREMENTS. "Environmental Requirements"
means all applicable present and future statutes, regulations, rules,
ordinances, codes, licenses, permits, orders, approvals, plans, authorizations,
concessions, franchises, and similar items of all governmental agencies,
departments, commissions, boards, bureaus, or instrumentalities of the United
States, states and political subdivisions thereof and all applicable judicial,
administrative, and regulatory decrees, judgments, and orders relating to the
protection of human health or the environment, including, without limitation:
(a) All requirements, including but not limited to those
pertaining to reporting, licensing, permitting, investigation,
and remediation of emissions, discharges, releases, or
threatened releases of Hazardous Materials, chemical substances,
pollutants, contaminants, or hazardous or toxic substances,
materials or wastes whether solid, liquid, or gaseous in nature,
into the air, surface water, groundwater, or land, or relating
to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport, or handling of chemical
substances, pollutants, contaminants, or hazardous or toxic
substances, materials, or wastes, whether solid, liquid, or
gaseous in nature; and
(b) All requirements pertaining to the protection of the health
and safety of employees or the public.
6.3.1.3 ENVIRONMENTAL DAMAGES. "Environmental Damages" means all
claims, judgments, damages, losses, penalties, fines, liabilities (including
strict liability), encumbrances, liens, costs, and expenses of investigation and
defense of any claim, whether or not such claim is
15
ultimately defeated, and of any good faith settlement or judgment, of whatever
kind or nature, contingent or otherwise, matured or unmatured, foreseeable or
unforeseeable, including without limitation reasonable attorneys' fees and
disbursements and consultants' and witnesses' fees, any of which are incurred at
any time as a result of the existence of Hazardous Material upon, about, beneath
the Premises or migrating or threatening to migrate to or from the Premises, or
the existence of a violation of Environmental Requirements pertaining to the
Premises, including without limitation:
(a) Damages for personal injury, or injury to property or
natural resources occurring upon or off of the premises,
foreseeable or unforeseeable, including, without limitation,
lost profits, consequential damages, the cost of demolition and
rebuilding of any improvements on real property, interest and
penalties including but not limited to claims brought by or on
behalf of employees of TENANT;
(b) Fees incurred for the services of attorneys, consultants,
contractors, experts, laboratories and all other costs incurred
in connection with the investigation or remediation of such
Hazardous Materials or violation of Environmental Requirements
including, but not limited to, the preparation of any
feasibility studies or reports or the performance of any
cleanup, remediation, removal, response, abatement, containment,
closure, restoration or monitoring work required by any federal,
state or local governmental agency or political subdivision or
court, or reasonably necessary to make full economic use of the
Premises and any other property in a manner consistent with its
current use or otherwise expended in connection with such
conditions, and including without limitation any attorneys'
fees, costs and expenses incurred in enforcing this agreement or
collecting any sums due hereunder;
(c) Liability to any third person or governmental agency to
indemnify such person or agency for costs expended in connection
with the items referenced herein; and
(d) Diminution in the value of the Premises and adjoining
property, and damages for the loss of business and restriction
on the use of or adverse impact on the marketing of rentable or
usable space or of any amenity of the Premises and adjoining
property.
6.3.2 TENANT'S OBLIGATION TO INDEMNIFY, DEFEND AND HOLD HARMLESS.
TENANT, its successors, and assigns, agree to indemnify, defend, reimburse and
hold harmless the following persons from and against any and all Environmental
Damages arising from activities of TENANT or its employees, agents, contractors,
subcontractors, or guests, licensees, or invitees; or which occurred during the
Term hereof (and were not caused by LANDLORD, its agents, employees,
contractors, subcontractors, guests, licensees, invitees or an Act of God) which
(1) result in the presence of Hazardous Materials upon, about or beneath the
Premises or migrating to or from the Premises, or (2) result in the violation of
any Environmental Requirements pertaining to the Premises and the activities
thereon:
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6.3.2.1 LANDLORD;
6.3.2.2 Any other person who acquires an interest in the
Premises in any manner, including but not limited to purchase at a foreclosure
sale or otherwise; and
6.3.2.3 The directors, officers, shareholders, employees,
partners, agents, contractors, subcontractors, experts, licensees, affiliates,
lessees, mortgagees, trustees, heirs, devisees, successors, assigns, guests and
invitees of such persons. This obligation shall include, but not be limited to,
the burden and expense of the indemnified parties in defending all claims, suits
and administrative proceedings, including attorneys' fees and expert witness and
consulting fees, even if such claims, suits or proceedings are groundless, false
or fraudulent, and conducting all negotiations of any description, and paying
and discharging, when and as they become due, any and all judgments, penalties
or other sums due against such indemnified persons, and all such expenses
incurred in enforcing the obligation to indemnify. TENANT, at its sole expense,
may employ additional counsel of its choice to associate with counsel
representing the indemnified parties.
6.3.3 TENANT'S OBLIGATION TO REMEDIATE. Except as disclosed in the
Baseline Assessments, and notwithstanding the obligation of TENANT to indemnify
LANDLORD pursuant to this agreement, TENANT shall, upon demand of LANDLORD, and
at TENANT'S sole cost and expense, promptly take all reasonable and necessary
actions to remediate the Premises which are reasonably necessary to mitigate
Environmental Damages or to allow full economic use of the Premises, or are
required by Environmental Requirements, which remediation is necessitated by the
(1) introduction of a Hazardous Material upon, about or beneath the premises or
(2) a violation of Environmental Requirements, either of which is caused by the
actions of TENANT, its employees, agents, contractors, subcontractors, guests,
invitees or licensees, or not so caused but arising during the Term hereof and
not caused by LANDLORD, its agents, employees, contractors, subcontractors,
guests, licensees or invitees (unless disclosed in the Baseline Assessments).
Such actions shall include, but not be limited to, the investigation of the
environmental condition of the Premises, the preparation of any feasibility
studies, reports or remedial plans, and the performance of any cleanup,
remediation, containment, operation, maintenance, monitoring or restoration
work, whether on or off of the Premises. Except as disclosed in the Baseline
Assessments, TENANT shall take all actions necessary to restore the Premises in
accordance with applicable environmental regulations and practices to the
condition existing prior to the introduction of Hazardous Material upon, about
or beneath the Premises, or to the standard of remediation allowable under
applicable State and Federal law or governmental policies. All such work shall
be performed by one or more contractors, selected by TENANT and approved in
advance and in writing by LANDLORD in LANDLORD'S reasonable discretion. TENANT
shall proceed continuously and diligently with such investigatory and remedial
actions, provided that in all cases such actions shall be in accordance with all
applicable requirements of governmental entities. Any such actions shall be
performed in a good, safe and workmanlike manner and shall minimize any impact
on the business conducted at the Premises. TENANT shall pay all costs in
connection with such investigatory and remedial activities, including but not
limited to all power and utility costs, and any and all taxes or fees that may
be applicable to such activities. TENANT shall promptly provide to LANDLORD
copies of testing
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results and reports that are generated in connection with the above activities,
and copies of any correspondence with any governmental entity related to such
activities. Unless otherwise required by applicable environmental standards or
governmental authorities, promptly upon completion of such investigation and
remediation, TENANT shall permanently seal or cap all monitoring ▇▇▇▇▇ and test
holes to industrial standards in compliance with applicable federal, state and
local laws and regulations, remove all associated equipment, and restore the
Premises to the maximum extent possible, which shall include, without
limitation, the repair of any surface damage, including paving, caused by such
investigation or remediation hereunder. Notwithstanding any of the foregoing or
the provisions of 2.3(b) above, TENANT shall not be obligated to remediate
environmental damages which result from seepage of Hazardous Materials onto the
Premises from adjacent property unless the presence on the adjacent property was
caused by TENANT or its employees, agents, contractors, subcontractors, guests,
invitees or licensees.
6.3.4 NOTIFICATION. If TENANT shall become aware of or receive notice
or other communication concerning any actual, alleged, suspected or threatened
violation of Environmental Requirements, or liability of TENANT for
Environmental Damages in connection with the Premises or past or present
activities of any person thereon, or that any representation set forth in this
agreement is not or is no longer accurate, including but not limited to notice
or other communication concerning any actual or threatened investigation,
inquiry, lawsuit, claim, citation, directive, summons, proceeding, complaint,
notice, order, writ, or injunction, relating thereto, then TENANT shall deliver
to LANDLORD, within ten days of the receipt of such notice or communication by
LANDLORD, a written description of such violation, liability, correcting
information, or actual or threatened event or condition, together with copies of
any such notice or communication. Receipt of such notice shall not be deemed to
create any obligation on the part of LANDLORD to defend or otherwise respond to
any such notification or communication.
6.3.5 NEGATIVE COVENANTS.
6.3.5.1 NO HAZARDOUS MATERIAL ON PREMISES. Except in compliance
with all Environmental Requirements, TENANT shall not cause, permit or suffer
any Hazardous Material to be brought upon, treated, kept, stored, disposed of,
discharged, released, produced, manufactured, generated, refined or used upon,
about or beneath the Premises by TENANT, its agents, employees, contractors,
subcontractors, guests, licensees or invitees, or any other person. TENANT shall
deliver to LANDLORD copies of all documents which TENANT provides to any
governmental body in connection with compliance with Environmental Requirements
with respect to the Premises, such delivery to be contemporaneous with provision
of the documents to the governmental agency.
6.3.5.2 NO VIOLATIONS OF ENVIRONMENTAL REQUIREMENTS. TENANT
shall not knowingly cause, permit or suffer the existence or the commission by
TENANT, its agents, employees, contractors, subcontractors or guests, licensees
or invitees, or by any other person of a violation of any Environmental
Requirements upon, about or beneath the Premises or any portion thereof.
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6.3.5.3 NO ENVIRONMENTAL OR OTHER LIENS. TENANT shall not
create or suffer or permit to exist with respect to the Premises, any lien,
security interest or other charge or encumbrance of any kind, including without
limitation, any lien imposed pursuant to section 107(f) of the Superfund
Amendments and Reauthorization Act of 1986 (42 U.S.C. section 9607(l) or any
similar state statute to the extent that such lien arises out of the actions of
TENANT, its agents, employees, contractors, subcontractors or guests, licensees
or invitees.
6.3.6 LANDLORD'S RIGHT TO INSPECT AND TO AUDIT TENANT'S RECORDS.
LANDLORD, upon notice to TENANT, during normal business hours and in a manner
that does not substantially interfere with TENANT'S ability to operate on the
Premises, shall have the right in its sole and absolute discretion, but not the
duty, to enter and conduct an inspection of the Premises and to inspect and
audit TENANT'S records concerning Hazardous Materials at any reasonable time to
determine whether TENANT is complying with the terms of this Lease, including
but not limited to the compliance of the Premises and the activities thereon
with Environmental Requirements and the existence of Environmental Damages as a
result of the condition of the Premises or surrounding properties and activities
thereon. If LANDLORD has reasonable cause to believe TENANT is in Default with
respect to any of the provisions of this Lease related to Hazardous Materials,
Environmental Requirements or Environmental Damages, then LANDLORD shall have
the right, but not the duty, to retain at the sole expense of TENANT an
independent professional consultant to enter the Premises to conduct such an
inspection and to inspect and audit any public records or reports prepared by or
for TENANT concerning such compliance. TENANT hereby grants to LANDLORD the
right to enter the Premises and to perform such tests on the Premises as are
reasonably necessary in the opinion of LANDLORD to assist in such audits and
investigations. LANDLORD shall use reasonable efforts to minimize interference
with the business of TENANT by such tests inspections and audits, but LANDLORD
shall not be liable for any interference caused thereby.
6.3.7 LANDLORD'S RIGHT TO REMEDIATE. Should TENANT fail to perform or
observe any of its obligations or agreements pertaining to Hazardous Materials
or Environmental Requirements, then LANDLORD shall have the right, but not the
duty, without limitation upon any of the rights of LANDLORD pursuant to this
Lease, upon notice to TENANT, and if reasonably possible, in a manner that does
not substantially interfere with TENANT'S ability to operate on the Premises, to
enter the Premises personally or through its agents, consultants or contractors
and perform the same. TENANT agrees to indemnify LANDLORD for the costs thereof
and liabilities therefrom as set forth in Paragraph 6.3.2. TENANT shall first be
afforded the opportunity to remedy any such default pursuant to the provisions
of Paragraph 13.1 below.
6.3.8 LANDLORD'S OBLIGATION TO REMEDIATE. LANDLORD agrees to remediate
all Environmental Damages (1) caused by LANDLORD, its agents, employees,
contractors, subcontractors, guests, licensees or invitees, or (2) not so caused
but arising prior to the Commencement Date hereof and not caused by TENANT, its
agents, employees, contractors, subcontractors, guests, licensees or invitees.
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6.3.9 LANDLORD'S OBLIGATION TO INDEMNIFY, DEFEND AND HOLD HARMLESS
CONCERNING ENVIRONMENTAL MATTERS. LANDLORD, its successors and assigns, agree to
indemnify, defend, reimburse and hold harmless the following persons from and
against any and all Environmental Damages arising from activities of LANDLORD or
its employees, agents, contractors, subcontractors or guests, licensees,
invitees; or which occurred prior to the Commencement Date (and were not caused
by TENANT, its agents, employees, contractors, subcontractors, guests,
licensees, invitees or an Act of God) which (1) result in the presence of
Hazardous Materials upon, about or beneath the premises or migrating to or from
the Premises, or (2) result in the violation of any Environmental Requirements
pertaining to the Premises and the activities thereon:
6.3.9.1 TENANT;
6.3.9.2 The directors, officers, shareholders, employees,
partners, agents, contractors, subcontractors, experts, licensees, affiliates,
lessees, mortgagees, trustees, heirs, devisees, successors, assigns and invitees
of TENANT.
This obligation shall include, but not be limited to, the burden and
expense of the indemnified parties in defending all claims, suits and
administrative proceedings, including attorneys' fees and expert witness and
consulting fees, even if such claims, suits or proceedings are groundless, false
or fraudulent, and conducting all negotiations of any description, and paying
and discharging, when and as the same become due, any and all judgments,
penalties or other sums due against such indemnified persons, and all such
expenses incurred in enforcing the obligation to indemnify. LANDLORD, at its
sole expense, may employ additional counsel of its choice to associate with
counsel representing TENANT.
6.3.10 SURVIVAL OF ENVIRONMENTAL OBLIGATIONS. The obligations
of LANDLORD and TENANT as set forth in Paragraph 6.3 and all of its
subparagraphs shall survive termination of this Lease, except that if LANDLORD
determines that the Final Assessments do not disclose any Hazardous Materials
that were not disclosed by the Baseline Assessments and do not disclose any
Hazardous Materials that are in concentrations greater than those disclosed by
the Baseline Assessments (after any remediation that LANDLORD may perform prior
to TENANT'S occupancy), then LANDLORD agrees to so notify TENANT and the
obligations of LANDLORD and TENANT set forth in Paragraph 6.3 and all its
subparagraphs shall not survive the termination of the Term of this Lease.
LANDLORD agrees not to unreasonably withhold or delay such determination or
delivery of notification thereof to TENANT. LANDLORD'S failure to notify TENANT
to the contrary within ninety (90) days after receipt of the Final Assessments
shall be deemed a notification that Final Assessments are acceptable and shall
terminate the said environmental obligations.
6.4 TENANT'S COMPLIANCE WITH APPLICABLE REQUIREMENTS. Except as
otherwise provided in this Lease, TENANT shall, at TENANT'S sole expense, fully,
diligently and in a timely manner, materially comply with all Applicable
Requirements, the requirements of any applicable fire insurance underwriter or
rating bureau, and the recommendations of LANDLORD'S engineers and/or
consultants to the extent that they relate in any manner to and
20
are not inconsistent with such requirements, without regard to whether such
requirements are now in effect or become effective after the Commencement Date.
TENANT shall, within 10 days after receipt of LANDLORD'S written request,
provide LANDLORD with copies of all permits and other documents, and other
information evidencing TENANT'S compliance with any Applicable Requirements
specified by LANDLORD, and shall immediately upon receipt, notify LANDLORD in
writing (with copies of any documents involved) of any threatened or actual
claim, notice, citation, warning, complaint or report pertaining to or involving
the failure of TENANT or the Premises to comply with any Applicable
Requirements.
6.5 INSPECTION; COMPLIANCE. LANDLORD and LANDLORD'S "Lender" (as
defined in Paragraph 30) and consultants shall have the right to enter into the
Premises at any time, in the case of an emergency, and otherwise at reasonable
times after reasonable notice, for the purpose of inspecting the condition of
the Premises and for verifying compliance by TENANT with this Lease. The cost of
any such inspections shall be paid by LANDLORD, unless a violation of Applicable
Requirements, or a Hazardous Material Condition (see paragraph 9.1) is found to
exist or be imminent, or the inspection is requested or ordered by a
governmental authority. In such case, TENANT shall upon request reimburse
LANDLORD for the reasonable, actual cost of such inspection, so long as such
inspection is reasonably related to the violation or contamination. In addition,
TENANT shall provide copies of all relevant material safety data sheets (MSDS)
to LANDLORD within 10 days of the receipt of a written request therefor.
7. MAINTENANCE; REPAIRS, UTILITY INSTALLATIONS; TRADE FIXTURES AND
ALTERATIONS.
7.1 TENANT'S OBLIGATIONS.
(a) IN GENERAL. Subject to the provisions of Paragraphs 7.2
(LANDLORD'S Obligations), 9 (Damage or Destruction), and 14 (Condemnation),
TENANT shall, at TENANT'S sole expense, keep the Premises, Utility Installations
(intended for TENANT'S exclusive use, no matter where located), and Alterations
(as such terms are hereinafter defined) in good order, condition and repair
(whether or not the portion of the Premises requiring repairs, or the means of
repairing the same, are reasonably or readily accessible to TENANT, and whether
or not the need for such repairs occurs as a result of TENANT'S use, any prior
use, the elements or the age of such portion of the Premises), including, but
not limited to, all equipment or facilities, such as plumbing, HVAC equipment,
electrical, lighting facilities, boilers, pressure vessels, fire protection
system, fixtures, walls (interior and exterior), foundations, ceilings, roofs,
roof drainage systems, floors, windows, doors, plate glass, skylights,
landscaping, irrigation systems, driveways, parking lots, fences, retaining
walls, signs, sidewalks, and parkways located in, on, or adjacent to the
Premises. TENANT, in keeping the Premises in good order, condition and repair,
shall exercise and perform good maintenance practices. TENANT'S obligations
shall include restorations, replacements or renewals when necessary to keep the
Premises and all improvements thereon or a part thereof in good order, condition
and state of repair. TENANT shall, during the term of this Lease, keep the
exterior appearance of the building(s) in a good operating condition (including,
e.g. graffiti removal) consistent with the exterior appearance of other similar
facilities of comparable age and size in the vicinity. Without limiting the
foregoing,
21
TENANT shall be liable for the cost of any damage to the Premises or the
building(s) or the sidewalks and pavements adjacent thereto which results from
the movement of heavy articles or heavy vehicles or utility cuts made by or on
behalf of TENANT. TENANT shall not overload the floors or any other part of the
Premises.
(b) SERVICE CONTRACTS. Without limiting TENANT'S obligations
under Paragraph 7.1 (a) above, only to the extent required by the Occupational
Heath and Safety Administration (OSHA), TENANT shall, at TENANT'S sole expense,
procure and maintain service contracts, with copies to LANDLORD, in customary
form and substance for, and with contractors specializing and experienced in the
maintenance of, any equipment and improvements installed in the Premises.
(c) FAILURE TO PERFORM. If TENANT fails to perform TENANT'S
obligations under this ▇▇▇▇▇▇▇▇▇ ▇.▇, ▇▇▇▇▇▇▇▇ may enter upon the Premises after
2 days prior written notice to TENANT (except in the case of an emergency, in
which case no notice shall be required), perform such obligations on TENANT'S
behalf, and put the Premises in good order, condition and repair, and TENANT
shall promptly pay to LANDLORD a sum equal to the actual cost thereof.
7.2 LANDLORD'S OBLIGATIONS. Subject to the provisions of this
Paragraph 7.2 and the provisions of Paragraphs 9 (Damage or Destruction) and 14
(Condemnation), LANDLORD shall have no obligation, in any manner whatsoever, to
repair, replace or maintain the Premises, or the equipment therein or any other
property, all of which obligations are intended to be that of the TENANT. The
Parties intend that the terms of this Lease govern the respective obligations of
the Parties as to repair, replacement and maintenance of the Premises, and they
expressly waive the benefit of any statute now or hereafter in effect to the
extent it is inconsistent with the terms of this Lease.
Except for any repairs of defects disclosed in the Engineering
Inspection that LANDLORD elects to perform as provided in Paragraph 2.4 hereof,
LANDLORD shall only be responsible for the repairs and replacements (but not the
maintenance) of the exterior walls and the roof of the building located on the
Premises, except for repairs or replacements which are necessitated by the acts
or omissions of TENANT or its employees, agents, contractors, sub-contractors,
licensees, invitees or guests which shall be paid for entirely by TENANT upon
demand by LANDLORD, and except for ordinary wear and tear.
7.3 UTILITY INSTALLATIONS; TRADE FIXTURES; ALTERATIONS.
(a) DEFINITIONS. The term "Utility Installations" refers to all
floor and window coverings, air and/or vacuum lines, power panels, electrical
distribution, security and fire protection systems, communication cabling,
lighting fixtures, HVAC equipment, plumbing, and fencing in or on the Premises.
The term "Trade Fixtures" shall mean TENANT'S machinery and equipment that can
be installed, operated and removed without doing material damage to the
Premises. The term "Alterations" shall mean any modification of the
improvements, other than Utility Installations or Trade Fixtures, whether by
addition or deletion. "TENANT Owned
22
Alterations and/or Utility Installations" are defined as Alterations and/or
Utility Installations made by TENANT that are not yet owned by LANDLORD pursuant
to Paragraph 7.4(a).
(b) CONSENT. TENANT shall not make any Alterations or Utility
Installations to the Premises without LANDLORD'S prior written reasonable
consent. TENANT may, however, make non-structural Utility Installations to the
interior of the Premises (excluding the roof) without such consent but upon
notice to LANDLORD, as long as they are not visible from the outside, do not
involve puncturing, relocating or removing the roof or any existing walls, will
not affect the electrical, plumbing, HVAC, and/or life safety systems, and the
cumulative cost thereof during the term of this Lease does not exceed a sum
equal to one month of Base Rent in any one calendar year. Notwithstanding the
foregoing, TENANT shall not make or permit any roof penetrations and/or install
anything on the roof without the prior written approval of LANDLORD. LANDLORD
may, as a precondition to granting such approval, require TENANT to utilize a
contractor reasonably approved by LANDLORD. Any Alterations or Utility
Installations that TENANT shall desire to make and which require the consent of
the LANDLORD shall be presented to LANDLORD in written form with detailed plans.
Consent shall be deemed conditioned upon TENANT'S: (i) acquiring all applicable
governmental permits, (ii) furnishing LANDLORD with copies of both the permits
and the plans and specifications prior to commencement of the work, and (iii)
compliance with all conditions of said permits and other Applicable Requirements
in a prompt and expeditious manner. Any Alterations or Utility Installations
shall be performed in a workmanlike manner with good and sufficient materials
and in accordance with all Applicable Requirements. At the time of such consent
or upon the request of TENANT regarding such non-structural Utility
Installations as TENANT is permitted by this paragraph 7.3(b) to make without
LANDLORD'S consent, LANDLORD shall indicate whether it will require (and
LANDLORD shall have the right to require) that any or all TENANT Owned
Alterations or Utility Installations be removed and the Premises repaired and
restored by the expiration or termination of this Lease. TENANT shall promptly
upon completion furnish LANDLORD with as-built plans and specifications. For
work which costs an amount in excess of one month of Base Rent, LANDLORD may
condition its consent upon TENANT providing a lien and completion bond in an
amount equal to 110% of the estimated cost of such Alteration or Utility
Installation and/or upon TENANT'S posting a security deposit with LANDLORD.
Prior to commencement of any work, whether it requires LANDLORD'S consent or
not, at LANDLORD'S request, TENANT shall submit to LANDLORD a set of fully
detailed working drawings and specifications for the proposed work, prepared by
a licensed architect or engineer. If any such work done by TENANT causes damage
to the structural portion, exterior finish or roof of the Premises, then in
addition to any other rights or remedies LANDLORD may have hereunder and any
obligations TENANT may have hereunder, the costs of repair of such damage and of
all further maintenance and repairs to such structural portion, exterior finish
or roof during the term of the Lease shall thereafter be the responsibility of
TENANT. Neither LANDLORD'S right of entry, nor any actual inspection by
LANDLORD, nor LANDLORD'S actual knowledge of any work accomplished or in
progress shall constitute a waiver of LANDLORD'S rights concerning alterations
by TENANT.
(c) LIENS; BONDS. TENANT shall pay, when due, all claims for
labor or materials furnished or alleged to have been furnished to or for TENANT
at or for use on the
23
Premises, which claims are or may be secured by any mechanic's or materialmen's
lien against the Premises or any interest therein. TENANT shall give LANDLORD
not less than 10 days notice prior to the commencement of any work in, on or
about the Premises, and LANDLORD shall have the right to post notices of
non-responsibility. If TENANT shall contest the validity of any such lien, claim
or demand, then TENANT shall, at its sole expense defend and protect itself,
LANDLORD and the Premises against the same and shall pay and satisfy any such
adverse judgment that may be rendered thereon before the enforcement thereof. If
LANDLORD shall require, TENANT shall furnish a surety bond in an amount equal to
110% of the amount of such contested lien, claim or demand, indemnifying
LANDLORD against liability for the same. If LANDLORD elects to participate in
any such action, TENANT shall pay LANDLORD'S attorneys' fees and costs.
7.4 OWNERSHIP; REMOVAL; SURRENDER; AND RESTORATION.
(a) OWNERSHIP. Subject to LANDLORD'S right to require removal or
elect ownership as provided herein, all Alterations and Utility Installations
made by TENANT shall be the property of TENANT, but considered a part of the
Premises. LANDLORD may, at any time, elect in writing to be the owner of all or
any specified part of the TENANT Owned Alterations and Utility Installations.
Unless otherwise instructed per paragraph 7.3(b) or 7.4(b) hereof, all TENANT
Owned Alterations and Utility Installations shall, at the expiration or
termination of this Lease, become the property of LANDLORD and be surrendered by
TENANT with the Premises.
(b) REMOVAL. LANDLORD may require the removal at any time of all
or any part of any TENANT Owned Alterations or Utility Installations made
without the required consent.
(c) SURRENDER; RESTORATION. TENANT shall surrender the Premises
by the Expiration Date or any earlier termination date, with all of the
improvements, parts and surfaces thereof broom clean and free of debris, and in
good operating order, condition and state of repair, ordinary wear and tear and
insured casualty only excepted. "Ordinary wear and tear" shall not include any
damage or deterioration that would have been prevented by good maintenance
practice. Notwithstanding the foregoing, if this Lease is for 12 months or less,
then TENANT shall surrender the Premises in the same condition as delivered to
TENANT on the Commencement Date with no allowance for ordinary wear and tear.
TENANT shall repair any damage occasioned by the installation, maintenance or
removal of Trade Fixtures, TENANT Owned Alterations and/or Utility
Installations, furnishings, and equipment as well as the removal of any storage
tank installed by or for TENANT. TENANT shall completely remove from the
Premises any and all Hazardous Materials brought onto the Premises by or for
TENANT, or any third party (except Hazardous Materials which were deposited via
underground migration from areas outside of the Premises) even if such removal
would require TENANT to perform or pay for work that exceeds statutory
requirements. Trade Fixtures shall remain the property of TENANT. TENANT shall
remove from the Premises any Trade Fixtures and any personal property owned by
TENANT or any third party permitted on the Premises by Tenant, before the
Premises are to be surrendered at the end of the Lease term, including the Mill
(hereinafter
24
defined), whether it is a fixture or personal property and whether it is then
owned by TENANT or a third party, except that the Mill shall not be removed
until permitted by the security agreement securing the performance of TENANT
under the Asset Purchase Agreement of even date between LANDLORD, as seller, and
TENANT, as buyer. (The term "Mill" is defined in said Asset Purchase Agreement.)
TENANT shall repair or replace the Premises upon the removal of the Mill as
required by said Asset Purchase Agreement. Any such property not removed on or
before the Expiration Date or any earlier termination date shall be deemed to
have been abandoned by TENANT and may be disposed of or retained by LANDLORD as
LANDLORD may desire, at TENANT'S cost which TENANT shall pay upon demand by
LANDLORD. The failure by TENANT to timely vacate the Premises pursuant to this
Paragraph 7.4(c) without the express written consent of LANDLORD shall
constitute a holdover under the provisions of ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇.
(▇) TENANT must, at its sole risk and expense, immediately
return all (but not less than all) of any Personal Property that TENANT does not
elect to purchase pursuant to this Lease, upon expiration of the Term (or any
renewal term) to LANDLORD at such location and at such time as LANDLORD shall
designate. TENANT will ensure that the Personal Property complies with all
Manufacturer's Requirements and is available for examination by prospective
buyers and/or lessees and inspection by LANDLORD. Upon return, the Personal
Property will be in compliance with all Manufacturer's Requirements and Safety
Laws and be in such a mechanical condition that the Personal Property can
immediately be placed into service by an operator without need for modifications
or mechanical repairs, and operate per Manufacturer Requirements. At least
fifteen (15) days prior to the return of the Personal Property, LANDLORD may
elect to have a qualified service technician inspect the Personal Property and
submit a written report as to the Personal Property's condition at TENANT'S
expense. Any items of Personal Property not found to be in compliance with
Manufacturer's Requirements will be brought into compliance by TENANT, at
TENANT'S expense, prior to the return of the Personal Property. TENANT will
return to LANDLORD all originals of operator's manuals, maintenance manuals,
Service Records or other materials regarding the Personal Property.
8. INSURANCE; INDEMNITY.
8.1 PAYMENT FOR INSURANCE. TENANT shall pay for all insurance
required under this Paragraph 8 except to the extent of the cost attributable to
liability insurance carried by LANDLORD under Paragraph 8.2(b) in excess of
$5,000,000 per occurrence. Premiums for policy periods commencing prior to or
extending beyond the Lease term shall be prorated to correspond to the Lease
term. Payment shall be made by TENANT to LANDLORD or to the insurer, at
LANDLORD'S option, within 10 days following receipt of an invoice.
8.2 LIABILITY INSURANCE.
(a) CARRIED BY TENANT. TENANT shall obtain and keep in force a
commercial general liability policy of insurance protecting TENANT and LANDLORD
as an additional insured against claims for bodily injury, personal injury and
property damage based upon or arising out of the ownership, use, occupancy or
maintenance of the Premises and all
25
areas appurtenant thereto. Such insurance shall be on an occurrence basis
providing single limit coverage in an amount not less than $5,000,000 per
occurrence with an annual aggregate of not less than $5,000,000, and such
endorsements as LANDLORD may reasonably require, including, but not limited to,
Per Location Aggregate and Contractual Liability endorsements. The policy shall
not contain any intra-insured exclusions as between insured persons or
organizations, but shall include coverage for liability assumed under this Lease
as an "insured contract" for the performance of TENANT'S indemnity obligations
under this Lease. The limits of said insurance shall not, however, limit the
liability of TENANT nor relieve TENANT of any obligation hereunder. All
insurance carried by TENANT shall be primary to and not contributory with any
similar insurance carried by LANDLORD, whose insurance shall be considered
excess insurance only. TENANT shall be responsible for the cost and expense of
such insurance and if it is obtained by LANDLORD, TENANT shall pay the cost
thereof within 10 days following receipt of an invoice.
(b) CARRIED BY LANDLORD. LANDLORD shall have the right to
maintain liability insurance as described in Paragraph 8.2(a), in addition to,
and not in lieu of, the insurance required to be maintained by TENANT. TENANT
shall not be named as an additional insured therein.
8.3 PROPERTY INSURANCE - BUILDING, IMPROVEMENTS AND RENTAL VALUE.
(a) BUILDING AND IMPROVEMENTS. LANDLORD shall obtain and keep in
force a policy or policies in the name of LANDLORD, with loss payable to
LANDLORD, any ground lessor, and to any Lender insuring loss or damage to the
Premises. The amount of such insurance shall be equal to the full replacement
cost of the Premises, as the same shall exist from time to time or the amount
required by any Lender, but in no event more than the commercially reasonable
and available insurable value thereof. If the coverage is available and
commercially appropriate, such policy or policies shall insure against all risks
of direct physical loss or damage (except the perils of flood and/or earthquake
unless required by a Lender), including coverage for debris removal and the
enforcement of any Applicable Requirements requiring the upgrading, demolition,
reconstruction or replacement of any portion of the Premises as the result of a
covered loss. Said policy or policies shall also contain an agreed valuation
provision in lieu of any coinsurance clause, waiver of subrogation, and
inflation guard protection causing an increase in the annual property insurance
coverage amount by a factor of not less than the adjusted U.S. Department of
Labor Consumer Price Index for All Urban Consumers for the city nearest to where
the Premises are located. If such insurance coverage has a deductible clause,
the deductible amount shall not exceed $1,000 per occurrence, and TENANT shall
be liable for such deductible amount in the event of an Insured Loss. TENANT
shall be responsible for the cost and expense of such insurance and if it is
obtained by LANDLORD, TENANT shall pay the cost thereof within 10 days following
receipt of an invoice.
(b) RENTAL VALUE. TENANT shall obtain and keep in force a policy
or policies in the name of LANDLORD with loss payable to LANDLORD and any
Lender, insuring the loss of the full Rent for one year with an extended period
of indemnity for an additional 180 days
26
("Rental Value Insurance"). Said insurance shall contain an agreed valuation
provision in lieu of any coinsurance clause, and the amount of coverage shall be
adjusted annually to reflect the projected Rent otherwise payable by TENANT, for
the next 12 month period. TENANT shall be liable for any deductible amount in
the event of such loss. TENANT shall be responsible for the cost and expense of
such insurance and if it is obtained by LANDLORD, TENANT shall promptly pay the
cost thereof within 10 days following receipt of an invoice.
8.4 TENANT'S PROPERTY; BUSINESS INTERRUPTION INSURANCE; OTHER
COVERAGE.
(a) PROPERTY DAMAGE. TENANT shall obtain insurance coverage on
all of TENANT'S personal property, Trade Fixtures, and TENANT Owned Alterations
and Utility Installations. Such insurance shall be full replacement cost
coverage with a deductible of not to exceed $5,000 per occurrence. The proceeds
from any such insurance shall be used by TENANT for the replacement of personal
property, Trade Fixtures and TENANT Owned Alterations and Utility Installations.
TENANT shall provide LANDLORD with written evidence that such insurance is in
force. TENANT shall be responsible for the cost and expense of such insurance
and if it is obtained by LANDLORD, TENANT shall pay the cost thereof within 10
days following receipt of an invoice.
(b) BUSINESS INTERRUPTION. TENANT shall obtain and maintain loss
of income and extra expense insurance in amounts as will reimburse TENANT for
direct or indirect loss of earnings attributable to all perils commonly insured
against by prudent tenants in the business of TENANT or attributable to
prevention of access to the Premises as a result of such perils. TENANT shall be
responsible for the cost and expense of such insurance and if it is obtained by
LANDLORD, TENANT shall pay the cost thereof within 10 days following receipt of
an invoice.
(c) WORKER'S COMPENSATION COVERAGE. TENANT shall maintain at all
times at its cost and expense worker's compensation insurance coverage as
required by law.
(d) ADDITIONAL COVERAGE. TENANT shall maintain at its cost and
expense, such additional insurance coverage as LANDLORD may reasonably require.
(e) NO REPRESENTATION OF ADEQUATE COVERAGE. LANDLORD makes no
representation that the limits or forms of coverage of insurance specified
herein are adequate to cover TENANT'S property, business operations or
obligations under this Lease.
8.5 INSURANCE POLICIES. Insurance required herein shall be by
companies duly licensed or admitted to transact business in the state where the
Premises are located, and maintaining during the policy term a "General
Policyholders Rating" of at least A-, VII, as set forth in the most current
issue of "Best's Insurance Guide", or such other rating as may be required by a
Lender. TENANT shall not do or permit to be done anything which invalidates the
required insurance policies. TENANT shall, prior to the Commencement Date,
deliver to LANDLORD certified copies of policies of such insurance or
certificates in form and content acceptable to LANDLORD evidencing the existence
and amounts of the required insurance. No
27
such policy shall be cancelable or subject to modification except after 30 days
prior written notice to LANDLORD. TENANT shall, at least 30 days prior to the
expiration of such policies, furnish LANDLORD and LANDLORD'S Lender, if any,
with evidence of renewals or "insurance binders" evidencing renewal thereof, or
LANDLORD may order such insurance and charge the cost thereof to TENANT, which
amount shall be payable by TENANT to LANDLORD upon demand. Such policies shall
be for a term of at least one year, or the length of the remaining term of this
Lease, whichever is less. If either Party shall fail to procure and maintain the
insurance required to be carried by it, the other Party may, but shall not be
required to, procure and maintain the same.
8.6 WAIVER OF SUBROGATION. Without affecting any other rights or
remedies, TENANT and LANDLORD each hereby release and relieve the other, and
waive their entire right to recover damages against the other, for loss of or
damage to its property arising out of or incident to the perils required to be
insured against herein. The effect of such releases and waivers is not limited
by the amount of insurance carried or required, or by any deductibles applicable
hereto. The Parties agree to have their respective property damage insurance
carriers waive any right to subrogation that such companies may have against
LANDLORD or TENANT, as the case may be, so long as the insurance is not
invalidated thereby.
8.7 INDEMNITY. Except for LANDLORD'S gross negligence or willful
misconduct, TENANT shall indemnify, protect, defend and hold harmless the
Premises, LANDLORD and its agents, LANDLORD'S master or ground lessor, partners
and Lenders, from and against any and all claims, loss of rents and/or damages,
liens, judgments, penalties, attorneys' and consultants' fees, expenses and/or
liabilities arising out of, involving, or in connection with, the use and/or
occupancy of the Premises by TENANT or any act, omission, or negligence of
TENANT, its employees, agents, contractors, subcontractors, guests, invitees, or
licensees, or any breach or default under this Lease by TENANT. If any action or
proceeding is brought against LANDLORD by reason of any of the foregoing
matters, TENANT shall upon notice defend the same at TENANT'S expense by counsel
reasonably satisfactory to LANDLORD and LANDLORD shall cooperate with TENANT in
such defense. LANDLORD need not have first paid any such claim in order to be
defended or indemnified.
8.7.1 In addition to any other provisions of this Lease and
notwithstanding the existence of any insurance in favor of LANDLORD, TENANT
shall promptly defend, indemnify and save LANDLORD harmless from and against:
(a) any and all loss of or damage to the Personal Property; and (b) any claim,
action, demand, proceeding, or liability for any damage, loss, injury, cost or
expense (including reasonable attorney's fees) which LANDLORD may be subject to:
(i) relating to the construction, importation, exportation, delivery,
installation, ownership, sale, lease, transfer, storage, nonacceptance,
rejection, return, or repossession of the Personal Property (or any part
thereof); (ii) resulting from the use, maintenance, repair, replacement,
operation or condition of the Personal Property (or any part thereof); (iii)
arising by reason of any act or omission of TENANT or TENANT'S violation of any
law, regulation or ordinance pertaining to the Personal Property; (iv) as a
result of any claim for patent, copyright, trademark or other proprietary right
infringement relating to the Personal Property or the use thereof; (v) as a
result of any tort, negligence or strict liability claim respecting the Personal
28
Property and/or the use thereof (including, without limitation, any contribution
and/or subrogation claims relating thereto); or (vi) as a result of any third
party claim to the Personal Property. (The foregoing are collectively called the
"Indemnity Claims".) TENANT agrees to give LANDLORD prompt written notice of any
Indemnity Claims described in this Paragraph. Notwithstanding the foregoing,
TENANT shall not be obligated to indemnify LANDLORD for any Indemnity Claim to
the extent actually and proximately caused by gross negligence or the willful
misconduct of LANDLORD, or if arising out of anything disclosed in the Baseline
Assessments.
8.8 EXEMPTION OF LANDLORD FROM LIABILITY. LANDLORD shall not be
liable for injury or damage to the person or goods, wares, merchandise or other
property of TENANT, TENANT'S employees, contractors, invitees, customers, or any
other person in about the Premises, whether such damage or injury is caused by
or results from fire, steam, electricity, gas, water or rain, or from the
breakage, leakage, obstruction or other defects of pipes, fire sprinklers,
wires, appliances, plumbing, HVAC or lighting fixtures, or from any other cause,
whether the said injury or damage results from conditions arising upon the
Premises or upon other portions of the building of which the Premises are a
part, or from other sources or places. LANDLORD shall not be liable for any
damages arising from any act or neglect of any other tenant of LANDLORD nor from
the failure of LANDLORD to enforce the provisions of any other lease for any of
the Premises, if any. Notwithstanding LANDLORD'S negligence or breach of this
Lease, LANDLORD shall under no circumstances be liable for injury to TENANT'S
business or for any loss of income or profit therefrom.
9. DAMAGE OR DESTRUCTION.
9.1 DEFINITIONS.
(a) "Premises Partial Damage" shall mean damage or destruction
to the improvements on the Premises, other than TENANT Owned Alterations and
Utility Installations, which can, in LANDLORD'S determination, reasonably be
repaired in 6 months or less from the date of the damage or destruction.
LANDLORD shall notify TENANT in writing within 30 days from the date of
LANDLORD'S receipt of notification from TENANT of the damage or destruction as
to whether or not the damage is Partial or Total.
(b) "Premises Total Destruction" shall mean damage or
destruction to the Premises, other than TENANT Owned Alterations and Utility
Installations and Trade Fixtures, which cannot, in LANDLORD'S determination,
reasonably be repaired in 6 months or less from the date of the damage or
destruction. LANDLORD shall notify TENANT in writing within 30 days from the
date of LANDLORD'S receipt of notification from TENANT of the damage or
destruction as to whether or not the damage is Partial or Total.
(c) "Insured Loss" shall mean damage or destruction to
improvements on the Premises, other than TENANT Owned Alterations and Utility
Installations and Trade Fixtures, which was caused by an event required to be
covered by the insurance described in Paragraph 8.3(a), irrespective of any
deductible amounts or coverage limits involved.
29
(d) "Replacement Cost" shall mean the cost to repair, rebuild or
replace the improvements owned by LANDLORD at the time of the occurrence to
their condition existing immediately prior thereto, including demolition, debris
removal and upgrading required by the operation of Applicable Requirements, and
without deduction for depreciation.
(e) "Hazardous Material Condition" shall mean the occurrence or
discovery of a condition involving the presence of, or a contamination by, a
Hazardous Material as defined in Paragraph 6.3.1, in, on, or under the Premises
which requires repair, remediation, or restoration.
9.2 PARTIAL DAMAGE - INSURED LOSS. If a Premises Partial Damage that
is an Insured Loss occurs and if there are sufficient insurance proceeds
available to repair such damage, then LANDLORD shall proceed to repair such
damage (but not TENANT'S Trade Fixtures or TENANT Owned Alterations and Utility
Installations) as soon as reasonably possible and this Lease shall continue in
full force and effect; provided, however, that TENANT shall, at LANDLORD'S
election, make the repair of any damage or destruction the total cost to repair
of which is $10,000 or less, and, in such event, LANDLORD shall make any
applicable insurance proceeds available to TENANT on a reasonable basis for that
purpose. Notwithstanding the foregoing, if the required insurance was not in
force or the insurance proceeds are not sufficient to effect such repair, the
party responsible for obtaining such insurance hereunder shall promptly
contribute the shortage in proceeds (except as to the deductible which is the
responsibility of the party obligated under this Lease to pay for the insurance)
as and when required to complete said repairs. In the event, however, such
shortage was due to the fact that, by reason of the unique nature of the
improvements, full replacement cost insurance coverage was not commercially
reasonable and available, LANDLORD shall have no obligation to pay for the
shortage in insurance proceeds or to fully restore the unique aspects of the
Premises unless TENANT provides LANDLORD with the funds to cover same, or
adequate assurance thereof, within 10 days following receipt of written notice
of such shortage and request therefor. If LANDLORD receives said funds or
adequate assurance thereof within said 10 day period, the party responsible for
making the repairs shall complete them as soon as reasonably possible and this
Lease shall remain in full force and effect. If such funds or assurance are not
received, LANDLORD may nevertheless elect by written notice to TENANT within 10
days thereafter to: (i) make such restoration and repair as is commercially
reasonable with LANDLORD paying any shortage in proceeds, in which case this
Lease shall remain in full force and effect, or (ii) have this Lease terminate
30 days thereafter. TENANT shall not be entitled to reimbursement of any funds
contributed by TENANT to repair any such damage or destruction. Premises Partial
Damage due to flood or earthquake shall be subject to Paragraph 9.3
notwithstanding that there may be some insurance coverage, but the net proceeds
of any such insurance shall be made available for the repairs if made by either
Party.
9.3 PARTIAL DAMAGE - UNINSURED LOSS. If a Premises Partial Damage
that is not an Insured Loss occurs, unless caused by a grossly negligent or
willful act of TENANT (in which event TENANT shall make the repairs at TENANT'S
expense), LANDLORD may either: (i) repair such damage as soon as reasonably
possible at LANDLORD'S expense, in which event this Lease shall continue in full
force and effect, or (ii) terminate this Lease by giving written
30
notice to TENANT within 30 days after receipt by LANDLORD of knowledge of the
occurrence of such damage. Such termination shall be effective 60 days following
the date of such notice. If LANDLORD elects to terminate this Lease, TENANT
shall have the right within 10 days after receipt of the termination notice to
give written notice to LANDLORD of TENANT'S commitment to pay for the repair of
such damage without reimbursement from LANDLORD. TENANT shall provide LANDLORD
with said funds or satisfactory assurance thereof within 30 days after making
such commitment. In such event this Lease shall continue in full force and
effect, and LANDLORD shall proceed to make such repairs as soon as reasonably
possible after the required funds are available. If TENANT does not make the
required commitment, this Lease shall terminate as of the date specified in the
termination notice.
9.4 TOTAL DESTRUCTION. Notwithstanding any other provision hereof,
if a Premises Total Destruction occurs, this Lease shall terminate 60 days
following such Destruction, If the damage or destruction was caused by the gross
negligence or willful misconduct of TENANT, LANDLORD shall have the right to
recover LANDLORD'S damages from TENANT, except as provided in Paragraph 8.6.
9.5 DAMAGE NEAR END OF TERM. If at any time during the last 12
months of this Lease there is damage for which the cost to repair exceeds one
month of Base Rent, whether or not an Insured Loss, LANDLORD may terminate this
Lease effective 60 days following the date of occurrence of such damage by
giving a written termination notice to TENANT within 30 days after the date of
LANDLORD'S receipt of notification from TENANT of the occurrence of such damage.
Notwithstanding the foregoing, if TENANT at that time has an exercisable right
to extend this Lease or to purchase the premises, then TENANT may preserve this
Lease by (a) exercising such right and (b) providing LANDLORD with any shortage
in insurance proceeds (or adequate assurance thereof) needed to make the repairs
on or before the earlier of (i) the date which is 10 days after TENANT'S receipt
of LANDLORD'S written notice purporting to terminate this Lease and (ii) the day
prior to the date upon which such right expires. If TENANT duly exercises such
right during such period and provides LANDLORD with funds (or adequate assurance
thereof) to cover any shortage in insurance proceeds, LANDLORD shall, at
LANDLORD'S commercially reasonable expense, repair such damage as soon as
reasonably possible and this Lease shall continue in full force and effect. If
TENANT fails to exercise such right and provide such funds or assurance during
such period, then this Lease shall terminate on the date specified in the
termination notice and TENANT'S right shall be extinguished.
9.6 ABATEMENT OF RENT; TENANT'S REMEDIES.
(a) ABATEMENT. In the event of Premises Partial Damage or
Premises Total Destruction or a Hazardous Material Condition for which TENANT is
not responsible under this Lease, the Rent payable by TENANT for the period
required for the repair, remediation or restoration of such damage shall be
abated in proportion to the degree to which TENANT'S use of the Premises is
impaired, but not to exceed the proceeds received by LANDLORD from the Rental
Value insurance. All other obligations of TENANT hereunder shall be performed by
TENANT, and LANDLORD shall have no liability for any such damage, destruction,
remediation, repair or restoration except as provided herein.
31
(b) REMEDIES. If LANDLORD shall be obligated to repair or
restore the Premises and does not commence, in a substantial and meaningful way,
such repair or restoration within 90 days after such obligation shall accrue,
TENANT may, at any time prior to the commencement of such repair or restoration,
give written notice to LANDLORD and to any Lenders of which TENANT has actual
notice, of TENANT'S election to terminate this Lease on a date not less than 60
days following the giving of such notice. If TENANT gives such notice and such
repair or restoration is not commenced within 30 days thereafter, this Lease
shall terminate as of the date specified in said notice. If the repair or
restoration is commenced within such 30 days, this Lease shall continue in full
force and effect. "Commence" shall mean either the unconditional authorization
of the preparation of the required plans, or the beginning of the actual work on
the Premises, whichever first occurs.
9.7 TERMINATION; ADVANCE PAYMENTS. Upon termination of this Lease
pursuant to Paragraph 9, an equitable adjustment shall be made concerning
advance Base Rent and any other advance payments made by TENANT to LANDLORD.
9.8 WAIVE STATUTES. LANDLORD and TENANT agree that the terms of this
Lease shall govern the effect of any damage to or destruction of the Premises
with respect to the termination of this Lease and hereby waive the provisions of
any present or future statute to the extent inconsistent herewith.
9.9 TERMINATION OF LEASE BY MORTGAGE HOLDER'S ELECTION.
Notwithstanding anything contained in this Lease to the contrary, if there is
damage to the Premises or any taking through right of eminent domain and the
holder of any indebtedness secured by a mortgage or deed of trust covering any
such property requires that the insurance or condemnation proceeds be applied to
such indebtedness, then LANDLORD shall have the right to terminate this Lease
(including also any right to purchase the Premises) by delivering written notice
of termination to TENANT within fifteen (15) days after such requirement is made
by such holder; provided, however, that LANDLORD agrees to use commercially
reasonable efforts to obtain the agreement of such holder to not require that
such proceeds be applied to the indebtedness.
10. PROPERTY TAXES.
10.1 DEFINITION. As used herein, the term "Real Property Taxes" shall
include any form of assessment or real estate tax regarding the Premises; real
estate, general, special, ordinary or extraordinary, or rental levy or tax
(other than inheritance, personal income or estate taxes); improvement bond;
and/or license fee imposed upon or levied against any legal or equitable
interest of LANDLORD in the Premises, LANDLORD'S right to other income
therefrom, and/or LANDLORD'S business of leasing, by any authority having the
direct or indirect power to tax and where the funds are generated with reference
to the Premises and where the proceeds so generated are to be applied by the
city, county or other taxing authority of a jurisdiction within which the
Premises are located. Real Property Taxes shall also include any tax, fee, levy,
assessment or charge, or any increase therein: (i) imposed by reason of events
occurring during the term of this Lease, including but not limited to, a change
in the ownership of the Premises,
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and (ii) levied or assessed on machinery, equipment or other property provided
by LANDLORD to TENANT pursuant to this Lease.
10.2 PAYMENT OF TAXES. TENANT shall be responsible for and pay any
Real Property Taxes which are a lien or are payable during any of the Term of
this Lease, as provided herein. LANDLORD plans to estimate from time to time the
Real Property Taxes, and TENANT shall pay such estimated taxes to LANDLORD
monthly in advance with, and in addition to, the payment of the Base Rent, on or
before the first day of each calendar month during the Term of this Lease,
beginning August 1, 2002. When the actual amount of the applicable tax ▇▇▇▇ is
known, any overpayment or deficiency in TENANT'S payment of Real Property Taxes
for any tax year shall be adjusted between LANDLORD and TENANT, and LANDLORD and
TENANT hereby agree that TENANT shall pay LANDLORD or LANDLORD shall credit to
TENANT'S account, as applicable, the adjustment amount (or if such adjustment is
at the end of the Term, LANDLORD shall pay TENANT such adjustment amount).
LANDLORD may re-estimate at any time Real Property Taxes and thereafter adjust
TENANT'S monthly installments to reflect more accurately TENANT'S obligation.
The following illustrates the intention of the parties with respect to
real estate taxes;
Assuming a five year Lease Term with a Commencement Date of
August 1, 2002, and an Expiration Date of July 31, 2007, and
annual real estate taxes for the Premises in the amount of
$24,000, TENANT would pay to LANDLORD, beginning August 1, 2002,
and continuing on the first day of each month thereafter during
the Term hereof, the sum of $2,000. Such sum would be held in a
separate account by LANDLORD, and beginning with the tax ▇▇▇▇(s)
issued in May or June, 2003 (which would be for the last half of
calendar year 2002), LANDLORD would use any funds in such
account to pay such tax ▇▇▇▇(s) (which ▇▇▇▇(s) for the last half
of calendar year 2002 shall be prorated to determine TENANT'S
obligation to pay taxes for the five months beginning August 1,
2002, and ending December 31, 2002) and LANDLORD would continue
this procedure throughout and after the Term hereof, including
payment of the tax ▇▇▇▇(s) issued after the end of the Lease
term in December, 2007), and in May or June, 2008 (which May or
June ▇▇▇▇(s) would be prorated to determine TENANT'S obligation
to pay taxes for July, 2007), LANDLORD and TENANT agree to use
good faith efforts to ensure that sufficient funds are available
in the account by the end of the Term of this Lease to allow
LANDLORD to pay the full amount of any real property taxes
billed by the tax authorities in December, 2007 for the first
half of calendar year 2007 and the prorated amount of any real
property taxes billed by the tax authorities in May or June,
2008, for the month of July, 2007.
Notwithstanding the foregoing, if LANDLORD is required under law to pay
Real Property Taxes in advance, TENANT agrees to pay LANDLORD, upon commencement
of the Term of this Lease or at any time during the Term, an amount as
determined by LANDLORD, to be the amount equal to Real Property Taxes for the
entire tax year in which the Term of this Lease commences or occurs and in such
event at the termination of this Lease TENANT shall be
33
entitled to a refund of Real Property Taxes paid which are attributable to a
period after this Lease expires. If LANDLORD shall fail to estimate Real
Property Taxes, TENANT shall pay to LANDLORD any such Real Property Taxes that
have been paid by LANDLORD or which are to become due and payable, within 10
days after LANDLORD delivers an invoice for such taxes to TENANT.
10.3 JOINT ASSESSMENT. If the Premises are not separately assessed,
TENANT'S liability shall be an equitable proportion of the Real Property Taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be mutually determined by LANDLORD and TENANT from the
respective valuations assigned in the assessor's work sheets or such other
information as may be reasonably available.
10.4 PERSONAL PROPERTY TAXES REGARDING TENANT'S PROPERTY. TENANT
shall pay, prior to delinquency, all taxes assessed against and levied upon
TENANT Owned Alterations, Utility Installations, Trade Fixtures, furnishings,
equipment and all personal property of TENANT, When possible, TENANT shall cause
its TENANT Owned Alterations and Utility Installations, Trade Fixtures,
furnishings, equipment and all other personal property to be assessed and billed
separately from the real property of LANDLORD. If any of TENANT'S said property
shall be assessed with LANDLORD'S real property, TENANT shall pay LANDLORD the
taxes attributable to TENANT'S property within 10 days after receipt of a
written statement setting forth the taxes applicable to TENANT'S property. If
LANDLORD so elects, LANDLORD shall have the right to estimate such taxes and
require TENANT to pay them in advance installments in the manner provided in
Paragraph 10.2 herein regarding Real Property Taxes.
10.5 TAXES ON LANDLORD'S PERSONAL PROPERTY. LANDLORD shall include
the Personal Property on LANDLORD'S personal property tax return consistent with
the method of reporting by LANDLORD for prior years, unless otherwise indicated
by LANDLORD in writing, and TENANT shall reimburse LANDLORD, upon demand, for
all taxes paid by LANDLORD with respect thereto.
10.6 SURVIVAL OF PROPERTY TAX PROVISIONS. The provisions of this
Paragraph 10 (Property Taxes), including the subparagraphs hereunder, shall
survive any termination of the term of this Lease.
11. UTILITIES AND SERVICES. TENANT shall contract directly for and pay
for promptly and not later than when due, all water, gas, heat, light, power,
telephone, trash disposal and other utilities and services supplied to the
Premises, together with any taxes thereon. If any such services are not
separately metered or billed to TENANT, TENANT shall pay a reasonable
proportion, to be determined by LANDLORD, of all charges jointly metered or
billed. There shall be no abatement of Rent and LANDLORD shall not be liable in
any respect whatsoever for the inadequacy, stoppage, interruption or
discontinuance of any utility or service due to riot, strike, labor dispute,
breakdown, accident, repair or other cause beyond LANDLORD'S reasonable control
or in cooperation with governmental request or directions.
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12. ASSIGNMENT AND SUBLETTING.
12.1 LANDLORD'S CONSENT REQUIRED.
(a) TENANT shall not by operation of law or otherwise assign,
transfer, mortgage or encumber (collectively, "assign or assignment") or sublet
all or any part of TENANT'S interest in this Lease or in the Premises without
LANDLORD'S prior written consent, which may be withheld by LANDLORD in
LANDLORD'S sole and absolute discretion, provided, however, LANDLORD shall not
unreasonably withhold its consent to any transfer to any affiliate or subsidiary
of the entity identified as TENANT in the first paragraph of this Lease.
(b) An assignment or subletting without consent shall, at
LANDLORD'S option, be a Default curable after notice per Paragraph 13.1 (e), or
a noncurable Default without the necessity of any notice and grace period. If
LANDLORD elects to treat such unapproved assignment or subletting as a
noncurable Default, LANDLORD may terminate this Lease.
(c) TENANT'S remedy for any breach of Paragraph 12.1 by LANDLORD
shall be limited to compensatory damages and/or injunctive relief.
12.2 TERMS AND CONDITIONS APPLICABLE TO ASSIGNMENT AND SUBLETTING.
(a) Regardless of LANDLORD'S consent, no assignment or
subletting shall: (i) be effective without the express written assumption by
such assignee or subtenant of the obligations of TENANT under this Lease, (ii)
release TENANT of any obligations hereunder, or (iii) alter the primary
liability of TENANT for the payment of Rent or for the performance of any other
obligations to be performed by TENANT.
(b) LANDLORD may accept Rent or performance of TENANT'S
obligations from any person other than TENANT pending approval or disapproval of
an assignment. Neither a delay in the approval or disapproval of such assignment
nor the acceptance of Rent or performance shall constitute a waiver or estoppel
of LANDLORD'S right to exercise its remedies for TENANT'S Default.
(c) LANDLORD'S consent to any assignment or subletting shall not
constitute a consent to any subsequent assignment or subletting.
(d) In the event of any Default by TENANT, LANDLORD may proceed
directly against TENANT or anyone else responsible for the performance of
TENANT'S obligations under this Lease, including any assignee or subtenant,
without first exhausting LANDLORD'S remedies against any other person or entity
responsible therefor to LANDLORD, or any security held by LANDLORD.
(e) Each request for consent to an assignment or subletting
shall be in writing, accompanied by information relevant to LANDLORD'S
determination as to the financial and
35
operational responsibility and appropriateness of the proposed assignee or
subtenant, including but not limited to the intended use and/or required
modification of the Premises, if any, together with a fee of $250 as
consideration for LANDLORD'S considering and processing said request. TENANT
agrees to provide LANDLORD with such other or additional information and/or
documentation as may be reasonably requested. (See also Paragraph 36)
(f) Any assignee of, or subtenant under, this Lease shall, by
reason of accepting such assignment or entering into such sublease, be deemed to
have assumed and agreed to conform and comply with each and every term,
covenant, condition and obligation herein to be observed or performed by TENANT
during the term of said assignment or sublease, other than such obligations as
are contrary to or inconsistent with provisions of an assignment or sublease to
which LANDLORD has specifically consented to in writing.
(g) LANDLORD'S consent to any assignment or subletting shall not
transfer to the assignee or subtenant any right to purchase the Premises granted
to the original TENANT by this Lease unless such transfer is specifically
consented to by LANDLORD in writing.
12.3 ADDITIONAL TERMS AND CONDITIONS APPLICABLE TO SUBLETTING. The
following terms and conditions shall apply to any subletting by TENANT of all or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein:
(a) TENANT hereby assigns and transfers to LANDLORD all of
TENANT'S interest in all Rent payable on any sublease, and LANDLORD may collect
such Rent and apply same toward TENANT'S obligations under this Lease; provided,
however, that until a Default shall occur in the performance of TENANT'S
obligations, TENANT may collect said Rent. If the amount exceeds TENANT'S
obligations any such excess shall be refunded to TENANT. LANDLORD shall not, by
reason of the foregoing or any assignment of such sublease, or by reason of the
collection of Rent, be deemed liable to the subtenant for any failure of TENANT
to perform and comply with any of TENANT'S obligations to such subtenant. TENANT
hereby irrevocably authorizes and directs any such subtenant, upon receipt of a
written notice from LANDLORD stating that a Default exists in the performance of
TENANT'S obligations under this Lease, to pay to LANDLORD all Rent due and to
become due under the sublease. Subtenant shall rely upon any such notice from
LANDLORD and shall pay all Rents to LANDLORD without any obligation or right to
inquire as to whether such Default exists, notwithstanding any claim from TENANT
to the contrary.
(b) In the event of a Default by TENANT, LANDLORD may, at its
option, require subtenant to attorn to LANDLORD, in which event LANDLORD shall
undertake the obligations of the sublessor under such sublease from the time of
the exercise of said option to the expiration of such sublease; provided,
however, LANDLORD shall not be liable for any prepaid rents or security deposit
paid by such subtenant to such sublessor or for any prior defaults of such
sublessor.
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(c) Any matter requiring the consent of the sublessor under a
sublease shall also require the consent of LANDLORD.
(d) No subtenant shall further assign or sublet all or any part
of the Premises without LANDLORD'S prior written consent, which consent may be
withheld in LANDLORD'S sole and absolute discretion.
(e) If LANDLORD shall deliver a copy of any notice of Default by
TENANT to the subtenant, the subtenant shall have the right to cure the Default
of TENANT within the grace period, if any, specified in such notice. The
subtenant shall have a right of reimbursement and offset from and against TENANT
for any such Defaults cured by the subtenant.
13. DEFAULT: REMEDIES
13.1 DEFAULT. A "Default" is defined as any of the events hereafter
described in this Paragraph 13.1.
(a) The failure of TENANT to make any payment of Rent or any
other sum required to be made by TENANT hereunder, whether to LANDLORD or to a
third party, when due.
(b) The abandonment by TENANT of the Premises; or the vacating
of the Premises by TENANT without providing a commercially reasonable level of
security, or where the coverage of the property insurance described in Paragraph
8.3 (Property Insurance-Building, Improvements and Rental Value) is jeopardized
as a result thereof, or without providing reasonable assurances to minimize
potential vandalism.
(c) Any representation made by TENANT shall be determined to be
false in any material way.
(d) The failure of TENANT to provide reasonable evidence of
insurance or surety bond, or to fulfill any obligation under this Lease which
endangers or threatens life or property, where such failure continues for a
period of 5 business days following written notice to TENANT.
(e) The failure by TENANT to provide (i) reasonable written
evidence of compliance with Applicable Requirements, (ii) the rescission of an
unauthorized assignment or subletting, (iii) an estoppel certificate, (iv) any
document requested under Paragraph 42 (Reservations), (v) material safety data
sheets (MSDS), or (vi) any other documentation or information which LANDLORD may
reasonably require of TENANT under the terms of this Lease, where any such
failure continues for a period of 10 days following written notice to TENANT.
(f) A failure by TENANT to perform any obligation of TENANT
under any of the terms, covenants, conditions or provisions of this Lease, other
than those described in
37
subparagraphs 13.l(a), (b), (c), (d), or (e) above, if such failure continues
for a period of 30 days after written notice; provided, however, that if the
nature of TENANT'S failure is such that more than 30 days are reasonably
required for its cure, then it shall not be deemed to be a Default if TENANT
commences such cure within said 30 day period and thereafter diligently
prosecutes such cure to completion.
(g) The occurrence of any of the following events: (i) the
making by TENANT of any general arrangement or assignment for the benefit of
creditors, (ii) TENANT becoming a "debtor" as defined in 11 U.S.C. Section 101
or any successor statute thereto (unless, in the case of a petition filed
against TENANT, the same is dismissed within 60 days); (iii) the appointment of
a trustee or receiver to take possession of substantially all of TENANT'S assets
located at the Premises or of TENANT'S interest in this Lease, where possession
is not restored to TENANT within 90 days; or (iv) the attachment, execution or
other judicial seizure of substantially all of TENANT'S assets located at the
Premises or of TENANT'S interest in this Lease, where such seizure is not
discharged within 90 days; provided, however, in the event that any provision of
this subparagraph (g) is contrary to any applicable law, such provision shall be
of no force or effect, and not affect the validity of the remaining provisions.
(h) The discovery that any financial statement of TENANT given
to LANDLORD was materially false.
(i) The occurrence of any default by TENANT under any other
lease or agreement between LANDLORD and TENANT, including but not limited to,
the Lease Agreement of even date between LANDLORD, as lessor, and TENANT, as
lessee, regarding certain equipment, after the expiration of any cure periods
therein.
13.2 REMEDIES. In the event of a Default, LANDLORD may, with or
without further notice or demand, and without limiting LANDLORD in the exercise
of any right or remedy which LANDLORD may have by reason of such Default:
(a) Terminate TENANT'S right to possession of the Premises by
any lawful means, in which case this Lease (and any option or right of refusal
granted herein) shall terminate and TENANT shall immediately surrender
possession to LANDLORD. In such event LANDLORD shall be entitled to reenter the
Premises and remove all property and persons and possess the Premises and
recover from TENANT: (i) the unpaid Rent which had been earned at the time of
termination; (ii) the worth at the time of award of the amount by which the
unpaid rent which would have been earned after termination until the time of
award exceeds the amount of such rental loss that the TENANT proves could have
been reasonably avoided; (iii) the worth at the time of award of the amount by
which the unpaid rent for the balance of the term after the time of award
exceeds the amount of such rental loss that the TENANT proves could be
reasonably avoided; and (iv) any other amount necessary to compensate LANDLORD
for all the detriment proximately caused by the TENANT'S failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom, including but not limited to the cost of recovering
possession of the Premises, expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorneys fees, and that
portion of
38
any leasing commission paid by LANDLORD in connection with this Lease
applicable to the unexpired term of this Lease. The worth-at-the time of award
of the amount referred to in provision (iii) of the immediately preceding
sentence shall be computed by discounting such amount at the discount rate of
the Federal Reserve Bank of the District within which the Premises are located
at the time of award plus one percent. Efforts by LANDLORD to mitigate damages
caused by TENANT'S Default of this Lease shall not waive LANDLORD'S right to
recover damages under Paragraph 12. If termination of this Lease is obtained
through the provisional remedy of unlawful detainer, LANDLORD shall have the
right to recover in such proceeding any unpaid Rent and damages as are
recoverable therein, or LANDLORD may reserve the right to recover all or any
part thereof in a separate suit. If a notice and grace period required under
Paragraph 13.1 was not previously given, a notice to pay rent or quit, or to
perform or quit given to TENANT under the unlawful detainer statute shall also
constitute the notice required by Paragraph 13.1. In such case, the applicable
grace period required by Paragraph 13.1 and the unlawful detainer statute shall
run concurrently, and the failure of TENANT to cure the Default within the
greater of the two such grace periods shall constitute both an unlawful detainer
and a Default of this Lease entitling LANDLORD to the remedies provided for in
this Lease and/or by said statute.
(b) Continue the Lease and TENANT'S right to possession and
recover the Rent as it becomes due, in which event TENANT may sublet or assign,
subject only to reasonable limitations. Acts of maintenance, efforts to relet,
and/or the appointment of a receiver to protect the LANDLORD'S interests shall
not constitute a termination of the TENANT'S right to possession.
(c) Perform any duty or obligation on TENANT'S behalf, including
but not limited to the obtaining of reasonably required bonds, insurance
policies, or governmental licenses, permits or approvals, and TENANT shall pay
to LANDLORD an amount equal to actual costs and expenses incurred by LANDLORD in
such performance upon receipt of an invoice therefor.
(d) Pursue any other remedy now or hereafter available under the
laws or judicial decisions of the state wherein the Premises are located. The
expiration or termination of this Lease and/or the termination of TENANT'S right
to possession shall not relieve TENANT from liability under any indemnity
provisions of this Lease as to matters occurring or accruing during the term
hereof or by reason of TENANT'S occupancy of the Premises.
13.3 LATE CHARGES. TENANT hereby acknowledges that late payment by
TENANT of Rent will cause LANDLORD to incur costs not contemplated by this
Lease, the exact amount of which will be extremely difficult to ascertain. Such
costs include, but are not limited to, processing and accounting charges, and
late charges which may be imposed upon LANDLORD by any Lender. Accordingly, if
any Rent shall not be received by LANDLORD within 10 days after such amount
shall be due, then, without any requirement for notice to TENANT, TENANT shall
immediately pay to LANDLORD a one-time late charge equal to 5% of each such
overdue amount or $100, whichever is greater. The Parties hereby agree that such
late charge represents a fair and reasonable estimate of the costs LANDLORD will
incur by reason of such late payment.
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Acceptance of such late charge by LANDLORD shall in no event constitute a waiver
of TENANT'S Default with respect to such overdue amount, nor prevent the
exercise of any of the other rights and remedies granted hereunder. In the event
that a late charge is payable hereunder, whether or not collected, for 3
consecutive installments of Base Rent, then notwithstanding any provision of
this Lease to the contrary, Base Rent shall, at LANDLORD'S option, become due
and payable quarterly in advance.
13.4 INTEREST. Any monetary payment due LANDLORD hereunder, other
than late charges, not received by LANDLORD within ten (10) days after the date
when due as to scheduled payments (such as Base Rent) or within 30 days
following the date on which it was due for non-scheduled payment, shall bear
interest from the date which is eleven (11) days after the date when due, as to
scheduled payments, or the 31st day after it was due as to non-scheduled
payments. The interest ("Interest") charged shall be computed at the rate equal
to the lesser of: (a) the published prime rate of The Huntington National Bank,
Columbus, Ohio, or such other national banking institution designated by
LANDLORD if such bank ceases to publish a prime rate then in effect, plus four
(4) percentage points, or (b) the maximum rate of interest per annum permitted
by applicable law. Interest is payable in addition to the potential late charge
provided for in Paragraph 13.3.
13.5 BREACH BY LANDLORD.
(a) NOTICE OF BREACH. LANDLORD shall not be deemed in breach of
this Lease unless LANDLORD fails within a reasonable time to perform an
obligation required to be performed by LANDLORD. For purposes of this Paragraph,
a reasonable time shall be 30 days after receipt by LANDLORD, and any Lender
whose name and address shall have been furnished TENANT in writing for such
purpose, of written notice specifying wherein such obligation of LANDLORD has
not been performed; provided, however, that if the nature of LANDLORD'S
obligation is such that more than 30 days are reasonably required for its
performance, then LANDLORD shall not be in breach if performance is commenced
within such 30 day period and thereafter diligently pursued to completion.
(b) PERFORMANCE BY TENANT ON BEHALF OF LANDLORD. If neither
LANDLORD nor Lender cures said breach within 30 days after receipt of said
notice, or if having commenced said cure they do not diligently pursue it to
completion, then TENANT may elect to cure said breach at TENANT'S expense and
offset from Rent the actual and reasonable cost to perform such cure; provided
however, that such offset shall not exceed one (1) month's Base Rent, reserving
TENANT'S right to seek reimbursement from LANDLORD. TENANT shall document the
cost of said cure and supply said documentation to LANDLORD.
14. CONDEMNATION. If the Premises or any portion thereof are taken under
the power of eminent domain or sold under the threat of the exercise of said
power (collectively "Condemnation"), this Lease shall terminate as to the part
taken as of the date the condemning authority takes title or possession,
whichever first occurs. If more than 10% of the building, or more than 25% of
that portion of the Premises not occupied by any building, is taken by
Condemnation, LANDLORD or TENANT, by notice to the other Party, to be given in
writing
40
within 10 days after LANDLORD shall have given TENANT written notice of such
taking (or in the absence of such notice, within 10 days after the condemning
authority shall have taken possession) may terminate this Lease (and any right
or option granted herein to TENANT) as of the date the condemning authority
takes such possession. If the Parties do not terminate this Lease in accordance
with the foregoing, this Lease shall remain in full force and effect as to the
portion of the Premises remaining, except that the Base Rent shall be reduced in
proportion to the reduction in utility of the Premises caused by such
Condemnation. Condemnation awards and/or payments shall be the property of
LANDLORD, whether such award shall be made as compensation for diminution in
value of the leasehold, the value of the part taken, or for severance damages;
provided, however, that TENANT shall be entitled to any separate award given as
compensation for TENANT'S relocation expenses. All Alterations and Utility
Installations made to the Premises by TENANT, for purposes of Condemnation only,
shall be considered the property of the LANDLORD and LANDLORD shall be entitled
to any and all compensation which is payable therefor. If this Lease is not
terminated by reason of the Condemnation, LANDLORD shall repair, to the extent
reasonably possible, any damage to the Premises caused by such Condemnation.
15. REPRESENTATIONS AND INDEMNITIES OF BROKER RELATIONSHIPS. TENANT and
LANDLORD each represent and warrant to the other that it has had no dealings
with any person, firm, broker or finder in connection with this Lease, and that
no one is entitled to any commission or finder's fee in connection herewith.
TENANT and LANDLORD do each hereby agree to indemnify, protect, defend and hold
the other harmless from and against liability for compensation or charges which
may be claimed by any such unnamed broker, finder or other similar party by
reason of any dealings or actions of the indemnifying Party, including any
costs, expenses, and attorneys fees reasonably incurred with respect thereto.
16. ESTOPPEL CERTIFICATE.
(a) TENANT shall, within 10 days after written notice from
LANDLORD, execute, acknowledge and deliver to LANDLORD in writing, in form and
content acceptable to LANDLORD, an "estoppel certificate" regarding the status
of this Lease and such other matters as LANDLORD may identify.
(b) If TENANT shall fail to execute or deliver the estoppel
certificate within such 10 day period, LANDLORD may execute an estoppel
certificate stating that: (i) the Lease is in full force and effect without
modification except as may be represented by LANDLORD, (ii) there are no uncured
defaults in LANDLORD'S performance (or if so, the nature of such uncured
defaults), and (iii) not more than one month's rent has been paid in advance.
Prospective purchasers and encumbrancers may rely upon LANDLORD'S estoppel
certificate, and TENANT shall be estopped from denying the truth of the facts
contained in said certificate.
(c) If LANDLORD desires to finance, refinance, or sell the
Premises, or any part thereof, TENANT shall deliver to any potential lender or
purchaser designated by LANDLORD such financial statements as may be required by
such lender or purchaser, including but not limited to TENANT'S financial
statements for the past 3 years. All such
41
financial statements shall be received by LANDLORD and such lender or purchaser
in confidence and shall be used only for the purposes herein set forth.
17. DEFINITION OF LANDLORD. The term "LANDLORD" as used herein shall
mean the owner or owners at the time in question of the fee title to the
Premises. Except as provided in Paragraph 15 (Representations and Indemnities of
Broker Relationships), in the event of a transfer or assignment of LANDLORD'S
interest in the Premises or this Lease, upon such transfer or assignment, the
prior LANDLORD shall be relieved of all liability with respect to the
obligations and/or covenants under this Lease thereafter to be performed by the
LANDLORD upon written notice to TENANT evidencing such transfer. Subject to the
foregoing, the obligations and/or covenants in this Lease to be performed by the
LANDLORD shall be binding only upon the LANDLORD as hereinabove defined.
18. SEVERABILITY. The invalidity of any provision of this Lease, as
determined by a court of competent jurisdiction, shall in no way affect the
validity of any other provision hereof.
19. DAYS. Unless otherwise specifically indicated to the contrary, the
word "days" as used in this Lease shall mean and refer to calendar days, and the
words "business days" shall mean and refer to calendar days, except for
Saturdays and Sundays and holidays when banks are closed in Columbus, Ohio.
20. LIMITATION ON LIABILITY. The obligations of LANDLORD under this
Lease shall not constitute personal obligations of LANDLORD or its partners,
members, directors, officers or shareholders, and TENANT shall not seek recourse
against LANDLORD'S partners, members, directors, officers or shareholders, or
any of their personal assets for such satisfaction. Liability of LANDLORD under
this Lease, including but not limited to any liability with respect to the entry
and performance of this Lease by or on behalf of LANDLORD, however it may arise,
shall be asserted and enforced only against LANDLORD'S estate and equity
interest in the Premises, and any insurance/condemnation proceeds/awards
received by LANDLORD from any destruction or condemnation of the Premises.
21. TIME OF ESSENCE. Time is of the essence with respect to the
performance of all obligations to be performed or observed by the Parties under
this Lease.
22. NO PRIOR OR OTHER AGREEMENTS. This Lease contains all agreements
between the Parties with respect to any matter mentioned herein, and no other
prior or contemporaneous agreement or understanding shall be effective.
23. NOTICES.
23.1 NOTICE REQUIREMENTS. All notices required or permitted by this
Lease or applicable law shall be in writing and may be delivered in person (by
hand or by courier) or may be sent by regular, certified or registered mail or
U.S. Postal Service Express Mail, with postage prepaid, or by overnight courier
that guarantees next day delivery or by facsimile transmission, and shall be
deemed sufficiently given if served in a manner specified in this Paragraph 23.
The
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addresses noted adjacent to a Party's signature on this Lease shall be that
Party's address for delivery or mailing of notices. Either Party may by written
notice to the other specify a different address for notice, except that upon
TENANT'S taking possession of the Premises, the Premises shall constitute
TENANT'S address for notice. A copy of all notices to LANDLORD shall be
concurrently transmitted to such party or parties at such addresses as LANDLORD
may from time to time hereafter designate in writing.
23.2 DATE OF NOTICE. Any notice sent by registered or certified mail,
return receipt requested, shall be deemed given on the date of delivery shown on
the receipt card, or if no delivery date is shown, the postmark thereon. If sent
by regular mail the notice shall be deemed given 48 hours after the same is
addressed as required herein and mailed with postage prepaid. Notices delivered
by United States Express Mail or overnight courier that guarantee next day
delivery shall be deemed given 24 hours after delivery of the same to the Postal
Service or courier. Notices transmitted by facsimile transmission or similar
means shall be deemed given upon telephone confirmation of receipt (confirmation
report from fax machine is sufficient), provided a copy is also delivered via
delivery or mail. If notice would be deemed to be given on a Saturday, Sunday or
legal holiday, it shall be deemed given on the next business day.
24. WAIVERS. No waiver by LANDLORD of Default of any term, covenant or
condition hereof by TENANT, shall be deemed a waiver of any other term, covenant
or condition hereof, or of any subsequent Default by TENANT of the same or of
any other term, covenant or condition hereof. LANDLORD'S consent to, or approval
of, any act shall not be deemed to render unnecessary the obtaining of
LANDLORD'S consent to, or approval of, any subsequent or similar act by TENANT,
or be construed as the basis of an estoppel to enforce the provision or
provisions of this Lease requiring such consent. The acceptance of Rent by
LANDLORD shall not be a waiver of any Default by TENANT. Any payment by TENANT
may be accepted by LANDLORD on account of moneys or damages due LANDLORD,
notwithstanding any qualifying statements or conditions made by TENANT in
connection therewith, which such statements and/or conditions shall be of no
force or effect whatsoever unless specifically agreed to in writing by LANDLORD
at or before the time of deposit of such payment.
25. SURVIVAL OF OBLIGATIONS. Notwithstanding anything contained in this
Lease to the contrary, upon the expiration or earlier termination of the Term of
this Lease, (a) any and all obligations of TENANT accruing prior to the
expiration or termination of the Term of this Lease shall survive the expiration
or earlier termination of the Term of this Lease, and TENANT shall promptly
perform all such obligations whether or not this Lease has expired or
terminated, and (b) any and all obligations of LANDLORD accruing prior to the
expiration or termination of the Term of this Lease shall survive the expiration
or earlier termination of the Term of this Lease, and LANDLORD shall promptly
perform all such obligations whether or not this Lease has expired or
terminated. Such obligations shall include, by way of illustration but not
limitation, any and all indemnity obligations set forth in this Lease.
26. NO RIGHT TO HOLDOVER. TENANT has no right to retain possession of
the Premises or any part thereof beyond the expiration or termination of this
Lease. If TENANT holds over, then the Base Rent shall be increased to 125% of
the Base Rent applicable immediately preceding the
43
expiration or termination. Nothing contained herein shall be construed as
consent by LANDLORD to any holding over by TENANT.
27. CUMULATIVE REMEDIES. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.
28. COVENANTS AND CONDITIONS; CONSTRUCTION OF AGREEMENT. All provisions
of this Lease to be observed or performed by TENANT are both covenants and
conditions. In construing this Lease, all headings and titles are for the
convenience of the Parties only and shall not be considered a part of this
Lease. Whenever required by the context, the singular shall include the plural
and vice versa. This Lease shall not be construed as if prepared by one of the
Parties, but rather according to its fair meaning as a whole as if both Parties
had prepared it.
29. BINDING EFFECT; CHOICE OF LAW. This Lease shall inure to the benefit
of and be binding upon the Parties, their personal representatives, successors
and permitted assigns and be governed by the laws of the State in which the
Premises are located.
30. SUBORDINATION; ATTORNMENT; NON-DISTURBANCE.
30.1 SUBORDINATION. This Lease and any right to purchase the Premises
granted hereby and all of TENANT'S rights under this Lease shall be subject and
subordinate to any ground lease, mortgage, deed of trust, or other hypothecation
or security device (collectively, "Security Device"), now or hereafter placed
upon the Premises, to any and all advances made on the security thereof, and to
all renewals, modifications, and extensions thereof. Subject to Section 30.3
below, TENANT agrees that the holders of any such Security Devices (in this
Lease together referred to as "Lender") shall have no liability or obligation to
perform any of the obligations of LANDLORD under this Lease. Any Lender may
elect to have this Lease and/or any right to purchase the Premises granted
hereby superior to the lien of its Security Device by giving written notice
thereof to TENANT, whereupon this Lease and such right to purchase the Premises
shall be deemed prior to such Security Device, notwithstanding the relative
dates of the documentation or recordation thereof.
30.2 ATTORNMENT. Without limiting the rights of LANDLORD otherwise
provided by law, the Parties agree that LANDLORD shall have the right to
transfer, mortgage, encumber and assign, in whole or in part, its rights and
obligations under this Lease and any and all of the Premises. If LANDLORD
transfers title to the Premises, or the Premises are acquired by another upon
the foreclosure or termination of a Security Device to which this Lease is
subordinated (i) TENANT shall, subject to the non-disturbance provisions of
Paragraph 30.3, attorn to such new owner, and upon request, enter into a new
lease, containing all of the terms and provisions of this Lease, with such new
owner for the remainder of the term hereof, or, at the election of such new
owner, this Lease shall automatically become a new Lease between TENANT and such
new owner, upon all of the terms and conditions hereof, for the remainder of the
term hereof, and (ii) LANDLORD shall thereafter be relieved of any further
obligations hereunder and such new owner shall assume all of LANDLORD'S
obligations hereunder, except that such new owner shall not: (a) be liable for
any act or omission of any prior LANDLORD or with respect to events
44
occurring prior to acquisition of ownership; (b) be subject to any offsets or
defenses which TENANT might have against any prior LANDLORD; (c) be bound by
prepayment of more than one month of rent, or (d) be liable for the return of
any security deposit paid to any prior LANDLORD.
30.3 NON-DISTURBANCE. With respect to Security Devices entered into
by LANDLORD whether before or after the execution of this Lease, TENANT'S
subordination of this Lease shall be subject to receiving a commercially
reasonable non-disturbance agreement (a "Non-Disturbance Agreement") from the
Lender which Non-Disturbance Agreement provides that TENANT'S possession of the
Premises, and this Lease, including any options to extend the term hereof, will
not be disturbed so long as TENANT is not in Default hereof and attorns to the
record owner of the Premises. TENANT specifically agrees to consent to a
Non-Disturbance Agreement that provides that the Lender has the right to apply
insurance proceeds and condemnation proceeds to the indebtedness if LANDLORD has
not been able to cause the Lender to omit such requirement by using commercially
reasonable efforts.
30.4 SELF-EXECUTING. The agreements contained in this Paragraph 30
shall be effective without the execution of any further documents; provided,
however, that upon written request from LANDLORD or a Lender in connection with
a sale, financing or refinancing of the Premises, TENANT and LANDLORD shall
execute such further writings as may be reasonably required to separately
document any subordination, attornment and/or Non-Disturbance Agreement provided
for herein.
31. ATTORNEYS FEES. If any Party brings an action or proceeding
involving the Premises whether founded in tort, contract or equity, or to
declare rights hereunder, the Prevailing Party (as hereafter defined) in any
such proceeding, action, or appeal thereon, shall be entitled to reasonable
attorneys fees. Such fees may be awarded in the same suit or recovered in a
separate suit, whether or not such action or proceeding is pursued to decision
or judgment. The term, "Prevailing Party" shall include, without limitation, a
Party who substantially obtains or defeats the relief sought, as the case may
be, whether by compromise, settlement, judgment, or the abandonment by the other
Party of its claim or defense. The attorneys fees award shall not be computed in
accordance with any court fee schedule, but shall be such as to fully reimburse
all attorneys fees reasonably incurred. In addition, LANDLORD shall be entitled
to attorneys fees, costs and expenses incurred in the preparation and service of
notices of Default and consultations in connection therewith, whether or not a
legal action is subsequently commenced in connection with such Default. The
Parties agree that $1,000 is a reasonable minimum per occurrence for such
services and consultation.
32. LANDLORD'S ACCESS: SHOWING PREMISES; REPAIRS. In addition to any
other rights granted to LANDLORD herein, LANDLORD and LANDLORD'S agents shall
have the right to enter the Premises during the last 6 months of the term after
reasonable prior notice, for the purpose of showing the same to prospective
tenants and at any time during the Lease term, in the case of an emergency, and
otherwise at reasonable times after reasonable prior notice for the purpose of
showing the same to prospective purchasers and lenders and for the purpose of
making such alterations, repairs, improvements or additions to the Premises as
LANDLORD
45
may deem necessary or desirable and for the purpose of erecting, using and
maintaining of utilities, services, pipes and conduits through the Premises
and/or other premises as long as there is no material adverse effect to TENANT'S
use of the Premises. All such activities shall be without abatement of rent or
liability to TENANT.
33. AUCTIONS. TENANT shall not conduct, nor permit to be conducted, any
auction upon the Premises without LANDLORD'S prior written consent. LANDLORD
shall not be obligated to exercise any standard of reasonableness in determining
whether to permit an auction.
34. SIGNS. LANDLORD may place on the Premises ordinary "For Sale" signs
at any time and ordinary "For Lease" signs during the last 6 months of the term
hereof. Except for ordinary "for sublease" signs, TENANT shall not place any
sign upon the Premises without LANDLORD'S prior written consent. All signs must
comply with all Applicable Requirements.
35. TERMINATION; MERGER. Unless specifically stated otherwise in writing
by LANDLORD, the voluntary or other surrender of this Lease by TENANT, the
mutual termination or cancellation hereof, or a termination hereof by LANDLORD
for Default by TENANT, shall also automatically terminate any right or option to
purchase or any other option TENANT may have hereunder and any sublease or
lesser estate in the Premises; provided, however, that LANDLORD may elect to
continue any one or all existing subtenancies. LANDLORD'S failure within 10 days
following any such event to elect to the contrary by written notice to the
holder of any such lesser interest, shall constitute LANDLORD'S election to have
such event constitute the termination of such interest.
36. CONSENTS. Except as otherwise provided herein, wherever in this
Lease the consent of a Party is required to an act by or for the other Party,
such consent shall not be unreasonably withheld or delayed. LANDLORD'S actual
reasonable costs and expenses (including but not limited to architects',
attorneys', engineers' and other consultants' fees) incurred in the
consideration of, or response to, a request by TENANT for any LANDLORD consent,
including but not limited to consents to an assignment, a subletting or the
presence or use of a Hazardous Material, shall be paid by TENANT upon receipt of
an invoice and supporting documentation therefor. LANDLORD'S consent to any act,
assignment or subletting shall not constitute an acknowledgment that no Default
by TENANT of this Lease exists, nor shall such consent be deemed a waiver of any
then existing Default, except as may be otherwise specifically stated in writing
by LANDLORD at the time of such consent. The failure to specify herein any
particular condition to LANDLORD'S consent shall not preclude the imposition by
LANDLORD at the time of consent of such further or other conditions as are then
reasonable with reference to the particular matter for which consent is being
given. If either Party disagrees with any determination made by the other
hereunder and reasonably requests the reasons for such determination, the
determining party shall furnish its reasons in writing and in reasonable detail
within 10 business days following such request.
37. [THIS PARAGRAPH INTENTIONALLY LEFT BLANK].
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38. QUIET POSSESSION. Subject to payment by TENANT of the Rent and
performance of all of the covenants, conditions and provisions on TENANT'S part
to be observed and performed under this Lease, and subject to any Applicable
Requirements, TENANT shall have quiet possession and quiet enjoyment of the
Premises during the term hereof.
39. [THIS PARAGRAPH INTENTIONALLY LEFT BLANK]
40. [THIS PARAGRAPH INTENTIONALLY LEFT BLANK.]
41. SECURITY MEASURES. TENANT hereby acknowledges that the Rent payable
to LANDLORD hereunder does not include the cost of guard service or other
security measures, and that LANDLORD shall have no obligation whatsoever to
provide same. TENANT assumes all responsibility for the protection of the
Premises, TENANT, its agents and invitees and their property from the acts of
third parties.
42. RESERVATIONS. LANDLORD reserves to itself the right, from time to
time, to grant, without the consent or joinder of TENANT, such easements, rights
and dedications that LANDLORD deems necessary, and to cause the recordation of
parcel maps and restrictions, so long as such easements, rights, dedications,
maps and restrictions do not unreasonably interfere with the use of the Premises
by TENANT. TENANT agrees to sign any documents reasonably requested by LANDLORD
to effectuate any such easement rights, dedication, map or restrictions.
43. PERFORMANCE UNDER PROTEST. If at any time a dispute shall arise as
to any amount or sum of money to be paid by one Party to the other under the
provisions hereof, the Party against whom the obligation to pay the money is
asserted shall have the right to make payment "under protest" and such payment
shall not be regarded as a voluntary payment and there shall survive the right
on the part of said Party to institute suit for recovery of such sum. If it
shall be adjudged that there was no legal obligation on the part of said Party
to pay such sum or any part thereof, said Party shall be entitled to recover
such sum or so much thereof as it was not legally required to pay.
44. AUTHORITY; MULTIPLE PARTIES; EXECUTION.
(a) If either Party hereto is a corporation, trust, limited
liability company, partnership, or similar entity, each individual executing
this Lease on behalf of such entity represents and warrants that he or she is
duly authorized to execute and deliver this Lease on its behalf. Each party
shall, within 30 days after request, deliver to the other party satisfactory
evidence of such authority.
(b) If this Lease is executed by more than one person or entity
as "TENANT", each such person or entity shall be jointly and severally liable
hereunder. It is agreed that any named TENANT shall be empowered to execute any
amendment to this Lease, or other document ancillary thereto and bind each named
TENANT, and LANDLORD may rely on the same as if each named TENANT had executed
such document.
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(c) This Lease may be executed by the Parties in counterparts,
each of which shall be deemed an original and all of which together shall
constitute one and the same instrument.
45. CONFLICT. Any conflict between the printed provisions of this Lease
and typewritten or handwritten provisions shall be controlled by the typewritten
or handwritten provisions.
46. NOT AN OFFER. The submission of this Lease to TENANT does not constitute
an offer to TENANT to lease the Premises. This Lease shall have no force or
effect until: (a) it is executed and delivered by TENANT to LANDLORD; and (b) it
is executed and delivered by LANDLORD to TENANT.
47. AMENDMENTS. This Lease may be modified only in writing signed by the
Parties in interest at the time of the modification. As long as they do not
materially change TENANT'S obligations hereunder, TENANT agrees to make such
reasonable non-monetary modifications to this Lease as may be reasonably
required by a Lender in connection with the obtaining of normal financing or
refinancing of the Premises.
48. WAIVER OF JURY TRIAL. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE
RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR
ARISING OUT OF THIS AGREEMENT.
49. [THIS PARAGRAPH INTENTIONALLY LEFT BLANK.]
50. AMERICANS WITH DISABILITIES ACT. Since compliance with the Americans
with Disabilities Act (ADA) is dependent upon TENANT'S specific use of the
Premises, LANDLORD makes no warranty or representation as to whether the
Premises comply with ADA or any similar legislation. If TENANT'S use of the
Premises requires modifications or additions to the Premises in order to be in
ADA compliance, TENANT shall make any such necessary modifications and/or
additions at TENANT'S expense.
51. TENANT'S RIGHT TO PURCHASE.
51.1 LANDLORD MUST OFFER PREMISES TO TENANT. If at any time during
the Term of this Lease, LANDLORD shall desire to sell the entire Premises,
LANDLORD shall first offer the Premises to TENANT ("Right of First Offer") as
follows:
(i) LANDLORD shall give to TENANT a written notice
specifying the Basic Sale Terms (as hereinafter defined) upon which LANDLORD
desires to sell the Premises; and
(ii) TENANT shall then have the right to purchase the
Premises by notifying LANDLORD in writing of the exercise of such Right of First
Offer not later than 10 days after TENANT'S receipt of such notice from
LANDLORD, time being of the essence.
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51.2 NO RIGHT IF DEFAULT, ASSIGNMENT, OR SUBLET. TENANT shall not
have a Right of First Offer if, at the time LANDLORD is obligated to deliver
notice to TENANT pursuant to paragraph 51.1 hereof, TENANT:
(i) is in Default under this Lease; or
(ii) has assigned this Lease or sublet all or a portion of
the Premises.
51.3. TENANT'S OBLIGATION IF RIGHT EXERCISED. If TENANT timely
exercises the Right of First Offer, then TENANT shall have the right and
obligation to purchase the Premises upon the Basic Sale Terms and the Additional
Sale Terms (as hereinafter defined) to the extent such Additional Sale Terms are
not inconsistent with the Basic Sale Terms.
51.4. CERTAIN TRANSFERS EXCLUDED. TENANT'S Right of First Offer shall
not apply to:
(i) any sale/leaseback transaction;
(ii) any sale or transfer of the Premises to any affiliate or
subsidiary of LANDLORD;
(iii) if LANDLORD is an individual, any sale or transfer of
the Premises to the spouse or a relative of LANDLORD, or
to a trust for the benefit of the spouse or a relative
of LANDLORD;
(iv) any transfer without consideration;
(v) any sale at public auction, or any subsequent transfer;
(vi) any sale to a buyer with the power of eminent domain, or
any subsequent transfer;
(vii) any gift or devise, whether or not in trust;
(viii) any sale arising out of the foreclosure of any lien, or
any subsequent transfer;
(ix) any judicial sale, or any subsequent transfer; or
(x) any deed granted in lieu of foreclosure, or any
subsequent transfer.
51.5. TENANT REJECTS RIGHT. If TENANT either rejects the Right of
First Offer or does not timely exercise the Right of First Offer, then LANDLORD
shall be free to sell the Premises to a third-party person or entity upon terms
and conditions no less favorable to LANDLORD than the Basic Sale Terms without
further obligation to TENANT, except that the purchase price may be as much as
five percent (5%) less than that reflected in the Basic Sale
49
Terms, and except that LANDLORD may give the third-party person or entity a
credit for real estate taxes and assessments which are unpaid at the time of the
closing, but not provide such credit to TENANT.
51.6. TENANT GETS ADDITIONAL RIGHT OF FIRST OFFER. If after TENANT
either rejects the Right of First Offer or does not timely exercise the Right of
First Offer and LANDLORD desires to offer the Premises for sale upon terms that
are less favorable to LANDLORD than the Basic Sale Terms and/or at a purchase
price that is more than five percent (5%) less than the purchase price stated in
the Basic Sale Terms, then LANDLORD must first give TENANT new notice of its
Right of First Offer to purchase the Premises in accordance with the procedures
set forth above. However, if the new notice to TENANT is given not more than 45
days after the previous notice to TENANT, then TENANT'S time to exercise its
Right of First Offer pursuant to such new notice shall be reduced to 5 days.
51.7. RIGHT TERMINATES AFTER SALE TO THIRD PARTY. Upon any sale of the
Premises to a third-party person or entity, TENANT'S Right of First Offer shall
forever terminate.
51.8. DEFINITIONS. As used herein:
(i) "Basic Sale Terms" shall mean the purchase price, terms
of payment of the purchase price, financing contingencies, if
any, and any other terms LANDLORD desires to include in the
notice to TENANT;
(ii) "Additional Sale Terms" shall mean any terms of sale
identified by LANDLORD that are in addition to the Basic Sale
Terms.
51.9. TERMINATION OF LEASE. The Lease shall terminate upon transfer of
title to TENANT pursuant to this Paragraph 51.
51.10 TERMINATION EVIDENCE. If the Right of First Offer has expired or
terminated or if TENANT does not elect to purchase the Premises pursuant to the
terms proposed by LANDLORD, TENANT shall duly execute and deliver to LANDLORD,
within 5 days after request by LANDLORD, written evidence of such expiration or
termination or failure to elect to Purchase, in recordable form acceptable to
LANDLORD.
52. NET LEASE. TENANT acknowledges and agrees that it is intended that
this is a "triple net lease" that is completely carefree to LANDLORD, except as
expressly set out in this Lease, that LANDLORD shall not be responsible for any
costs, charges, expenses, or outlays of any nature whatsoever relating to the
Premises, or the use or occupancy thereof, or the contents thereof, or the
business carried on therein, and TENANT shall pay all charges, expenses, costs,
and outlays of every nature and kind relating to the Premises, except as
expressly set out in this Lease.
53. RECORDING. LANDLORD and TENANT agree that this Lease shall not be
recorded, but that a memorandum hereof in substantially the form set forth in
Exhibit 53 attached hereto shall be executed and delivered within ten (10) days
after the written request of either party, which
50
memorandum may be recorded in Franklin County, Ohio at the expense of such
requesting party. Further, if LANDLORD and TENANT agree to extend the initial
Lease term beyond the Expiration Date stated in Paragraph 1.2, LANDLORD and
TENANT will execute and deliver a revised or amended memorandum of lease within
ten (10) days after the written request of either party hereto, which shall be
substantially in the form set forth in Exhibit 53, except that the reference to
the Lease term shall include the extended expiration date, which revised or
amended memorandum may be recorded in Franklin County, Ohio at the expense of
such requesting party.
54. TENANT'S OPTION TO PURCHASE CERTAIN PERSONAL PROPERTY. Except as
hereinafter provided in this Paragraph 54 and so long as TENANT is not in
Default under this Lease, if TENANT and LANDLORD agree to extend the term of
this Lease as provided in Paragraph 3.4, then TENANT shall have the option to
purchase those, but only those, items of Personal Property that are identified
in Exhibit 54 ("Option Personal Property") at the end of the initial term of
this Lease for a purchase price of One Dollar ($1.00), and if TENANT and
LANDLORD do not agree to extend the term of this Lease, then TENANT shall have
the option to purchase the Option Personal Property at the end of the initial
term (whether it expires on the Expiration Date or on an earlier date pursuant
to the provisions of Paragraph 51.9 herein) at its fair market value (as
reasonably determined by LANDLORD) as of the end of the initial term, minus the
discounted value of the prorata portion (as reasonably determined by LANDLORD)
of the payments of Base Rent actually made by TENANT for the Option Personal
Property under this Lease for the initial term, discounted as of the
Commencement Date at the rate of 7%, plus any applicable state or federal sales,
use or other similar taxes. If TENANT elects to purchase the Option Personal
Property, TENANT shall so notify LANDLORD in writing pursuant to the provisions
of Paragraph 23 not earlier than six months and, unless the initial term expires
pursuant to Paragraph 51.9 herein, not later than three months before the end of
the initial five-year Term of this Lease, and shall pay the full purchase
price, plus all applicable taxes, not later than at the time of purchase.
If TENANT purchases the Option Personal Property, then it shall be
subject to the provisions of this Lease regarding TENANT'S property, which
include, for example, certain insurance obligations and the obligation to remove
it from the Premises at the end of the Lease term. If this option expires or
terminates, TENANT shall provide to LANDLORD, upon LANDLORD'S request, such
written confirmation of such expiration or termination as LANDLORD may
reasonably request.
If TENANT purchases the Option Personal Property, LANDLORD agrees to
convey LANDLORD'S title to the Option Personal Property by a ▇▇▇▇ of sale
whereby LANDLORD covenants with TENANT that the Option Personal Property is free
from all encumbrances made by LANDLORD, and that LANDLORD does warrant and will
defend the same to TENANT, its successors and assigns, against the lawful claims
and demands of all persons claiming by, through, or under LANDLORD, but against
none other.
55. SECURITY INTEREST.
55.1 OPTION PERSONAL PROPERTY SECURITY INTEREST. TENANT and LANDLORD
agree
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that TENANT is owner of the Option Personal Property in compliance with revised
Article 9 of the UCC and this Lease constitutes a financing of the purchase of
the Option Personal Property. TENANT grants LANDLORD a security interest in and
lien on all of the Option Personal Property and other property related to such
transaction contemporaneously with TENANT'S entering into such transaction with
LANDLORD, and LANDLORD shall have all the rights and remedies of a secured party
under Revised Article 9 of the UCC as to the Option Personal Property. All of
TENANT'S obligations to LANDLORD now existing or hereafter arising under this
Lease are secured by all the Option Personal
Property leased hereunder and by
the security interests created by any present and future agreements executed in
connection with any promise to pay any money to LANDLORD or any of its
affiliates.
55.2 OTHER PERSONAL PROPERTY SECURITY INTEREST. TENANT and LANDLORD
agree that as to the Personal Property other than the Option Personal Property,
this transaction is a true lease, but if this lease transaction as to such
personal property is deemed to be a financing transaction for any purpose,
TENANT grants LANDLORD a security interest in and lien on all of the Personal
Property other than the Option Personal Property and other property related to
such transaction contemporaneously with TENANT'S entering into such transaction
with LANDLORD, and LANDLORD shall have all the rights of a secured party under
Revised Article 9 of the Uniform Commercial Code as to the Personal Property
other than the Option Personal Property.
56. POWER OF ATTORNEY. TENANT herby irrevocaby appoints LANDLORD as TENANT'S
attorney-in-fact to carry out its obligations herunder, including the
administration of insurance policies and proceeds, as well as financing
statements, provided however, that unless TENANT is in default of its
obligations hereunder, LANDLORD shall give TENANT written notice as soon as
practicable after it has taken any action as TENANT'S attorney-in-fact.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
52
IN WITNESS WHEREOF, the Parties have executed this Lease at the place and on the
dates specified above their respective signatures.
Executed at: Columbus, Ohio Executed at: Columbus, Ohio
on: May 24, 2002 on: May 24, 2002
By LANDLORD: By TENANT:
▇▇▇▇▇▇▇ Incorporated, an Ohio Quality Products, Inc., a Delaware
corporation corporation
By: By:
-------------------------------- ----------------------------------
Name Printed: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ Name Printed: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: President & CEO Title: President
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Telephone: _________________________ Telephone: ___________________________
Facsimile: _________________________ Facsimile: ___________________________
Federal ID No. _____________________ Federal ID No. _______________________
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇▇
:▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
The foregoing instrument was acknowledged before me this 24th day of May, 2002
by ▇▇▇▇▇▇▇ A, ▇▇▇▇▇▇▇▇▇, as President & CEO of ▇▇▇▇▇▇▇ Incorporated, an Ohio
corporation, on behalf of the corporation.
------------------------------
Notary Public
STATE OF OHIO
:SS
COUNTY OF FRANKLIN
The foregoing instrument was acknowledged before me this 24th day of May, 2002
by ▇▇▇▇▇ ▇▇▇▇▇▇, as President of Quality Products, Inc., a Delaware corporation,
on behalf of the corporation.
------------------------------------
Notary Public
54
EXHIBIT 1.1(A)
SITUATED IN THE STATE OF OHIO, COUNTY OF FRANKLIN, CITY OF COLUMBUS, AND
BEING A PART OF SECTION 4, TOWNSHIP 4, RANGE 22, CONGRESS LANDS AND BEING ALL OF
THE 1.28 ACRE TRACT CONVEYED TO ▇▇▇▇▇▇ ▇. AND ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ OF RECORD IN
OFFICIAL RECORDS VOLUME 1385O, F-2O AND A PART OF THE 11,501 ACRE TRACT (TRACT#
1) CONVEYED TO ▇▇▇▇▇▇▇ LEUKART, INC. OF RECORD IN DEED BOOK 3737; PAGE 842 OF
THE FRANKLIN COUNTY RECORDERS OFFICE AND BEING FURTHER DESCRIBED AS FOLLOWS:
COMMENCING AT THE INTERSECTION OF THE SOUTH LINE OF KINGSTON AVENUE AND THE ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇: THENCE WITH THE SAID ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇ DEGREES 57 MINUTES 25 SECONDS EAST 144 72 FEET (DEED) TO AN
EXISTING IRON PIN (3/4 INCH PIPE) AT THE NORTHWEST CORNER OF THE SAID 1.28 ACRE
TRACT, SAID POINT BEING THE PLACE OF BEGINNING OF THE TRACT HEREIN INTENDED TO
BE DESCRIBED: THENCE WITH THE NORTHERLY LINE OF THE SAID TRACT THE NEXT THREE
COURSES AND DISTANCES
1) NORTH 89 & DEGREES 17 MINUTES 58 SECONDS EAST 300.00 FEET TO A POINT. PASSING
AN IRON PIN SET AT 165.00 FEET;
2) SOUTH 00 DECREES 57 MINUTES 25 SECONDS EAST 9.18 FEET TO AN IRON PIN SET;
3) NORTH 89 DEGREES 16 MINUTES 11 SECONDS EAST 244.62 FEET TO AN EXISTING IRON
PIN (3/4 INCH PIPE - PS6579) ON THE WESTERLY RIGHT-OF-WAY LINE OF THE CHESSIE
SYSTEM RAILROAD. PASSING AN EXISTING IRON PIN (3/4 INCH PIPE-PS6579) AT 104.22
FEET; THENCE WITH THE SAID RAILROAD RIGHT-OF-WAY LINE, SOUTH 49 DEGREES 19
MINUTES 10 SECONDS EAST 137 07 FEET TO AN EXISTING IRON PIN (1/2 INCH PIPE);
THENCE CONTINUING WITH THE SAID RAILROAD RIGHT-OF-WAY LINE, SOUTH 49 DEGREES 32
MINUTES 54 SECONDS EAST 173.72 FEET TO AN EXISTING IRON PIN (3/4 INCH PIPE);
THENCE WITH THE NORTH LINE OF THE HIRSCHVOGEL, INC. TRACT, SOUTH 89 DEGREES 15
MINUTES 40 SECONDS WEST 777.35 FEET TO AN EXISTING P/K NAIL ON THE EAST LINE OF
THE SOUTH 3RD STREET, SAID POINT BEING NORTH 00 DEGREES 57 MINUTES 25 SECONDS
WEST 170.50 FEET FROM AN EXISTING IRON PIN (1/2 INCH PIPE); THENCE WITH THE
SAID ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇ DEGREES 57 MINUTES 25 SECONDS WEST
214.50 FEET TO THE PLACE OF BEGINNING, PASSING AN IRON PIN SET AT 114,50 FEET.
CONTAINING 3.175 MORE OR LESS ACRES, SUBJECT TO ALL APPLICABLE
EASEMENTS.
ALL IRON PINS SET ARE 5/8 INCH X 30 INCH REBAR WITH PLASTIC
IDENTIFICATION CAPS (▇▇▇▇▇▇▇▇▇▇ PS5718-PS6923).
BEARINGS ARE BASED ON THE DEED BEARING OF SOUTH 00 DEGREES 57 MINUTES 25
SECONDS EAST ASSIGNED TO THE ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ (SURVEY OF A 0.40
ACRE TRACT CONVEYED TO ▇▇▇▇▇▇▇, INC.)
I HEREBY CERTIFY TO THE BEST OF MY KNOWLEDGE AND BELIEF THE SURVEY AND
DESCRIPTION TO BE CORRECT AS PREPARED BY ME. THIS 12TH DAY OF FEBRUARY 1997.
/s/ ▇. ▇. ▇▇▇▇▇▇▇▇▇▇
------------------------------------
▇. ▇. ▇▇▇▇▇▇▇▇▇▇
REGISTERED SURVEYOR 5818
[SEAL]
EXHIBIT 1.1(B)
LIST OF PERSONAL PROPERTY
I. CATEGORY 1 (CONSIDERED PART OF THE BUILDING)
(1) LARGE 50/15 TON CRANE, SERIAL NUMBER 96C1011
(8) JIB CRANES, ▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇-▇ ▇▇▇▇▇▇▇, J-2
DC19669, J-3 DC19666, J-4 DC19664, J-5 DC19662, J-6 DC19667, J-7 DC14672
AND J-8 DC19668.
(1) GANTRY CRANE 15/15 TON-SERIAL NUMBER 31883
(1) 50/10 TON CRANE
PAINT BOOTH
(2) CRANE SPREADER BARS
SECURITY SYSTEM
MONORAIL W/AIRHOIST ▇▇▇▇▇ SER. B-A28 ▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇. BUDGET CHAIN SER. 235127 3 TON MACHINE SHOP
BRIDGE ELEC. C&M CHAIN SER. L775CX ▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇. BUDGET CHAIN SER. 231985 3 TON MACHINE SHOP
BRIDGE W/AIRHOIST GARDEN DENVER SER. 75018AA1 1/4 TON MACHINE SHOP
BRIDGE ELEC. C&M CHAIN SER, L-492CY 1 TON STOCK ROOM
II CATEGORY 2 (ALSO SPECIFIED IN ATTACHMENT 54)
(4) 5 DRAWER STANDARD FILING CABINET BLACK
(2) 5 DRAWER LATERAL FILE CABINET BLACK
(2) 3 DRAWER LATERAL FILE CABINET BLACK
(2) 4 DRAWER LATERAL FILE CABINET BLACK
(2) 2 DRAWER LATERAL FILE CABINET BLACK
(3) 4 DRAWER STANDARD FILING CABINET BLACK
(1) 2 DRAWER STANDARD FILING CABINET BLACK
(1) 4 DRAWER WIDE FILING CABINET BLACK
(1) 4 DRAWER STANDARD FILING CABINET BLACK
(1) BOARD ROOM CREDENZA
(3) BOOK SHELVE TAN
(13) BOOK SHELVE BLACK
(1) BOOK SHELVE TAN AND BLACK
(2) BOOK SHELVE LARGE BLACK
(32) DESKS WITH OVERHEAD UNIT
(2) DESKS WITH NO OVERHEAD
(7) VARIOUS DESKS IN SHOP AREA
(1) BOARD ROOM TABLE
(1) LARGE OPS CONFERENCE TABLE
(3) RECTANGULAR TABLES ON LEGS
(1) ROUND TABLE
(2) LARGE LUNCHROOM TABLES
(7) OTHER TABLES
(42) BLUE CHAIRS ON WHEELS
(30) BLUE CHAIRS ON LEGS
(10) BLACK LEATHER CHAIRS ON WHEELS
(2) GREEN CHAIRS
(3) RECEPTION CHAIRS
(26) ▇▇▇▇▇ LUNCHROOM CHAIRS
(9) OTHER LUNCHROOM CHAIRS
(16) SHOP AREA CHAIRS
MULTILINE TELEPHONE SYSTEM
III. CATEGORY 3
NONE
EXHIBIT 53
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE is made this ___________ day of ______,
______, by and between ▇▇▇▇▇▇▇ Incorporated, an Ohio corporation having an
office at _____________________________________________________________________
________________ ("Landlord"), and Quality Products, Inc., a Delaware
corporation, having an office at ________________________________ ("Tenant").
In consideration of the rents, terms, covenants, and conditions to be
performed by Tenant pursuant to a Lease between the parties hereto dated
___________________________________, 2002 (the "Lease"), Landlord hereby leases
to Tenant, and Tenant does hereby take and hire from Landlord, certain Leased
premises consisting of the premises described in Exhibit A attached hereto
("Premises").
TO HAVE AND TO HOLD the Premises for a term of five (5) years having a
Commencement Date of August 1, 2002, and an Expiration Dated of July 31, 2007,
unless the term is terminated sooner pursuant to the terms of the Lease.
Tenant also has a "Right of First Offer" to purchase the Premises during
the term of the Lease, as further provided in the Lease.
This Memorandum is subject to all of the terms and conditions of the
Lease, which is incorporated herein by reference. It is understood by the
parties hereto that the Lease constitutes the entire agreement between Landlord
an Tenant with respect to the subject matter hereof. This memorandum shall not
be construed to modify or amend the Lease in any respect. Capitalized terms used
herein shall have the meanings defined in the Lease.
IN WITNESS WHEREOF, the parties hereto have executed this Memorandum as
of the date first above written.
LANDLORD
▇▇▇▇▇▇▇ Incorporated
By:
--------------------------------
Name Printed:
----------------------
Its:
-------------------------------
TENANT
Quality Products, Inc.
By:
--------------------------------
Name Printed:
----------------------
Its:
-------------------------------
STATE OF _______________
:SS
COUNTY OF ______________
The foregoing instrument was acknowledged before me this _________________day of
_____________, 2002 by __________________________, as __________________________
of ▇▇▇▇▇▇▇ Incorporated, an Ohio corporation, on behalf of the corporation.
------------------------------
Notary Public
STATE OF _______________
:SS
COUNTY OF ______________
The foregoing instrument was acknowledged before me this _______________________
day of ____________, 2002 by _______________________________________________, as
_________________________________________________ of Quality Products, Inc., a
Delaware corporation, on behalf of the corporation.
------------------------------------
Notary Public
This Instrument Prepared By:
▇▇▇▇ ▇. ▇▇▇▇▇
PORTER, WRIGHT, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ 432I5
EXHIBIT 54
OPTION PERSONAL PROPERTY
(4) 5 DRAWER STANDARD FILING CABINET BLACK
(2) 5 DRAWER LATERAL FILE CABINET BLACK
(2) 3 DRAWER LATERAL FILE CABINET BLACK
(2) 4 DRAWER LATERAL FILE CABINET BLACK
(2) 2 DRAWER LATERAL FILE CABINET BLACK
(3) 4 DRAWER STANDARD FILING CABINET BLACK
(1) 2 DRAWER STANDARD FILING CABINET BLACK
(1) 4 DRAWER WIDE FILING CABINET BLACK
(1) 4 DRAWER STANDARD FILING CABINET BLACK
(1) BOARD ROOM CREDENZA
(3) BOOK SHELVE TAN
(13) BOOK SHELVE BLACK
(1) BOOK SHELVE TAN AND BLACK
(2) BOOK SHELVE LARGE BLACK
(32) DESKS WITH OVERHEAD UNIT
(2) DESKS WITH NO OVERHEAD
(7) VARIOUS DESKS IN SHOP AREA
(1) BOARD ROOM TABLE
(1) LARGE OPS CONFERENCE TABLE
(3) RECTANGULAR TABLES ON LEGS
(1) ROUND TABLE
(2) LARGE LUNCHROOM TABLES
(7) OTHER TABLES
(42) BLUE CHAIRS ON WHEELS
(30) BLUE CHAIRS ON LEGS
(10) BLACK LEATHER CHAIRS ON WHEELS
(2) GREEN CHAIRS
(3) RECEPTION CHAIRS
(26) ▇▇▇▇▇ LUNCHROOM CHAIRS
(9) OTHER LUNCHROOM CHAIRS
(16) SHOP AREA CHAIRS
MULTILINE TELEPHONE SYSTEM