STATE OF NORTH CAROLINA
COUNTY OF ▇▇▇▇▇▇▇▇
THIS LEASE AGREEMENT, made as of this 1st day of April, 1998, between
▇▇▇▇▇ ▇. ▇▇▇▇▇ AND ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, hereinafter "Landlord", and B & L
SPORTSWEAR, INC., a North Carolina corporation, hereinafter "Tenant."
W-I-T-N-E-S-S-E-T-H:
That Landlord, in consideration of the rents, covenants and conditions
herein contained, to be paid, kept and performed by Tenant, does hereby
demise and lease to Tenant, and Tenant does hereby hire and lease from
Landlord, those certain premises (the "Premises") hereinafter described.
NOW, THEREFORE, for and in consideration of the payments to be made by
Tenant and of the prompt and faithful performance of the covenants and
conditions hereinafter to be performed, Landlord hereby leases to Tenant and
Tenant takes and hires from Landlord those certain premises located on U.S.
Highway 301 in or near the Town of Four Oaks, ▇▇▇▇▇▇▇▇ County, North
Carolina, hereinafter referred to as the "Premises" and shown on the said
plat attached hereto as Exhibit "A", (less and except the property outlined
in blue on Exhibit B), together with the manufacturing buildings known as the
B & L Sportswear Plant, hereinafter collectively referred to as the
"Buildings", together with the non-exclusive right in common with others
lawfully entitled thereto, to the use of the entrance and driveways to and
from the Premises and U.S. Highway 301 South.
IN CONSIDERATION THEREOF, Landlord and Tenant agree as follows:
1. COVENANT OF TITLE AND QUIET ENJOYMENT: Landlord covenants and
warrants that Landlord alone has full right and lawful authority to enter
into this Lease for the full term hereof; that Landlord is lawfully seized of
the Premises in fee simple or has good title thereto sufficient to be able to
convey this Leasehold and any easement or rights described and perform all
conditions herein required, free and clear of all tenancies, restrictions and
encumbrances, except those acceptable to Tenant, and that at all times during
the term of this Lease and any extensions of said term, Tenant's quiet and
peaceful enjoyment of the Premises and rights as provided herein, shall not
be disturbed or interfered with by anyone.
2. (a) INITIAL TERM: The initial term of this Lease shall be for ten
(10) years, commencing on the 1ST day of April, 1998, and expiring on the
31st day of March, 2008, (a twelve-month period subsequent to the
commencement date shall constitute a "Lease year," as hereinafter referred
to.)
(b) EXTENSION OF TERM: It is agreed that, at the expiration of the
initial term of this Lease, if this Lease shall then be in full force and
effect and Tenant shall have performed all of its obligations, terms and
conditions provided in this Lease, Tenant may, at its option, extend this
Lease for two (2) additional terms of five (5) years each by giving to the
Landlord written notice of its intention to do so not later than ninety (90)
days prior to the end of the initial term or then existing term of this
Lease; and in the event of such extension, all of the terms
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and conditions of this Lease applicable to the initial term of this Lease
shall continue in full force and effect. If Tenant fails to give said notice
to Landlord within such time period, it shall be conclusively deemed that
Tenant has elected not to renew and extend the then existing term of this
Lease and this Lease shall terminate at the end of the then existing term.
3. RENT: Subject to the provisions of Paragraph 6(b) providing for
the payment of Additional Rent, Tenant shall pay to Landlord for the use of
the Premises during the term of this Lease, the following rent: Sixty-Four
Thousand Nine Hundred Ninety One Dollars ($64,991.00) each Lease year of the
Initial Term and any Extended Term payable in monthly installments of
$5,415.92 each.
All monthly payments of rent shall be paid on the 1st day of the month
in advance, commencing on the 1st day of April, 1998, and shall be paid by
Tenant to Landlord, at the address hereinafter designated for notices,
without set-off and without further notice or demand, until Tenant is further
notified by Landlord. All rent shall be payable in the current legal tender
of the United States of America. Any extension of time for the payment of
rent or the acceptance by Landlord or its agent of any money other than the
kind or amount herein specified shall not be a waiver of the right of
Landlord to insist upon the subsequent payments of rent being made in the
manner and at the time herein specified.
4. USE: The Premises may be used by Tenant for the operation of a
clothing manufacturing plant and with the prior written consent of
Landlord, which consent shall not be unreasonably withheld, for other
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commodities. In no event shall the Premises or parking area be used for the
storage of explosives, petroleum or products which create an obnoxious odor
or fail to comply with the environmental requirements hereinafter set forth.
Tenant shall have the right to erect upon the Buildings at the loading docks
on the Premises, a sign in compliance with applicable governmental laws and
regulations and Landlord's approval. In occupying the Premises, Tenant shall
comply with all laws, ordinances, orders and regulations of any lawful
authority and shall keep the Premises in a neat and clean condition and shall
comply with all requirements, ordinances, orders, and regulations of any
lawful authority for the removal of snow and ice or other obstructions from
sidewalks and driveways on the Premises and parking area.
5. TENANT'S EQUIPMENT AND STOCK: Tenant shall have the right to
deliver to and install in the Premises any equipment, trade fixtures, stock
or other material to be used by it in the operation of its business. All
such equipment, trade fixtures and stock used shall be supplied and installed
at the sole cost and expense of Tenant and shall at all times be the sole
property of Tenant.
6. ALTERATIONS TO PREMISES:
(a) Tenant shall not, without Landlord's prior written consent, make any
alterations and additions to any part of the Buildings on the Premises. All
alterations, decorations, installations, additions or improvements upon the
Premises, made by Landlord or Tenant, including, but not limited to, all wiring,
paneling, flooring and installation of walls, shall, unless Landlord elects
otherwise, become the property of
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Landlord, and shall remain upon, and be surrendered with the Premises, as a
part thereof, at the end of the term or any renewal term, as the case may be.
Provided, Tenant shall have the continuing right, without Landlord's consent,
to erect, install, maintain, and operate on the Premises such equipment and
fixtures as Tenant may deem advisable. It is mutually agreed that with
respect to the usual trade fixtures and equipment, that all such trade
fixtures and equipment shall not be deemed to become part of the Premises but
shall remain chattels and the sole and exclusive property of Tenant, except
as otherwise provided in Paragraph 8 of this Lease.
(b) Landlord shall have the option of erecting or causing to be
erected, at Landlord's expense, such structural additions to the Buildings on
the Premises requested by Tenant at any time during the initial term or any
extended term of this Lease, substantially in accordance with plans,
specifications and estimated costs thereof, prepared by Tenant and approved
by Landlord. Landlord may elect to (i) construct or cause to be constructed
such structural additions requested by Tenant within a reasonable time after
notice from Tenant, in a workmanlike manner. In consideration thereof,
Tenant shall pay to Landlord as Additional Rent an amount equal to ten
percent (10%) of Landlord's cost of said improvements, said Additional Rent
to be payable for the remaining part of the Lease year in which the
improvements are completed and for each Lease year of the then existing term
and any extended term thereafter, payable in equal monthly installments
commencing on the first day of the month following completion of said
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structural additions; Additional Rent shall be paid in a manner pursuant to
Paragraph 3 of this Lease; or (ii) elect not to construct said structural
additions, in which event Tenant may exercise its option to purchase the
Premises in accordance with the terms and conditions set forth in Paragraph
26 of this Lease. All additions, alterations and improvements made in or to
the Premises by either Landlord or Tenant shall become the property of the
Landlord and be surrendered with the Premises at the termination of this
Lease.
7. REMOVAL OF EQUIPMENT AND FIXTURES: Tenant shall have the right at
any time during the term of this Lease and at the end of the term to enter
upon and remove or cause to be removed from the Premises any of its equipment
or trade fixtures. All damage caused to the premises by such removal shall
be repaired by Tenant within ten (10) days after removal; provided, however,
that no such property shall be removed if such removal would cause permanent
injury to the structure of the Buildings or Premises. Any personal property
of Tenant or any subtenant or assignee which shall remain in the Premises
after the termination of this Lease and the removal of Tenant or such
subtenant from the Premises, may, at the option of Landlord, be deemed to
have been abandoned by Tenant or such subtenant or assignee and may be either
retained by Landlord as its property or be disposed of, without
accountability, in such a manner as Landlord may see fit (including having
the same stored at the risk and expense of Tenant), or if Landlord shall give
written notice to Tenant to such effect, such property shall be removed by
Tenant at Tenant's sole cost and expense.
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The foregoing provisions of this paragraph shall be without prejudice to
any election by Landlord that Tenant's failure to remove its property
constitutes a holding over by Tenant.
8. MAINTENANCE AND REPAIRS: Landlord shall keep the roof, exterior
walls, foundations, load bearing walls and all structural parts of the
Buildings on the Premises in good repair except for any damages thereto
caused by the negligence of Tenant, its agents, servants and employees, which
damages shall be promptly repaired by Tenant at Tenant's sole expense.
Tenant acknowledges that at the time of the execution of this Lease, the
roof, exterior walls, load bearing walls and all structural parts of the
Buildings on the Premises are in good repair. In the event of any leak in
the roof, Tenant shall immediately report the same to Landlord. Landlord
shall not be responsible for any damage resulting from unreported leaks, or
leaks which occur from damage and destruction beyond the control of Landlord.
Landlord, at its sole cost and expense, shall make all other repairs to
the interior of the Buildings on the Premises including the floor, electrical
and plumbing repairs, except damages thereto caused by the negligence of the
Tenant, its agents, servants, employees and invitees, which repairs shall be
made by Tenant. Tenant agrees to maintain the interior of the Buildings in
good repair, ordinary wear and tear excepted. Landlord shall maintain the
heating and air conditioning equipment during the first Lease year and Tenant
shall maintain said equipment thereafter. Upon the termination of this
Lease, Tenant shall surrender the Premises and all attached improvements
thereon to Landlord
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in as good a condition as existing at the time of its initial occupancy,
ordinary wear and tear excepted. If Tenant defaults in keeping or performing
its obligations hereunder, Landlord shall have the right, after fifteen (15)
days notice (except no notice need be sent in cases of emergency), to keep or
perform Tenant's obligation in its behalf and the cost of the same shall be
added to the next rent payment as the same becomes due.
9. UTILITY PAYMENTS: Upon the presentation by Landlord to Tenant of a
statement from Carolina Power and Light for the utility charges for the
Buildings, Tenant shall pay the entire amount of said statement to Landlord
within five (5) days thereafter. Said amount shall be considered additional
rent. Except with respect to the installation of additional utilities in
connection with the construction of improvements pursuant to Paragraph 6(b)
of this Lease, if Tenant desires additional utilities or additional propane
or natural gas service on the Premises, any installation and all charges for
the use thereof shall be at Tenant's expense. Landlord shall not be required
to furnish any security system. Tenant may secure any gas supply and
security system which Tenant may desire, at Tenant's expense.
10. TAXES AND ASSESSMENTS: Tenant shall list and promptly pay as when
the same become due and payable all taxes, levies and assessments upon the
Premises during each year. Tenant shall list and promptly pay when the same
shall become due all taxes, levies and assessments upon the trade fixtures,
equipment and other personal property located upon the Premises.
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11. FIRE INSURANCE: Tenant shall maintain and pay all premiums
required to keep the Premises, the Buildings and improvements thereon insured
against loss or damage by fire and such other risks as may be included in the
standard form of extended coverage from time to time available to the extent
the full insurable value thereof. Tenant shall keep, maintain, and pay such
insurance as it deems reasonable and necessary to protect Tenant with respect
to its equipment, inventory, contents and personal property located on the
Premises. The proceeds of said policy or policies of insurance upon the
Premises, Buildings and improvements thereon shall belong to Landlord and the
proceeds thereof shall be applied by Landlord as hereinafter set forth. The
proceeds of insurance on Tenant's equipment, inventory, contents and personal
property shall belong to Tenant.
12. SUBROGATION: The parties hereto agree to use their best efforts to
have any and all fire, extended coverage or any and all material damage
insurance which may be carried pursuant to this Lease endorsed with the
following subrogation clause: "This insurance shall not be invalidated
should the insured waive prior to a loss any or all right of recovery against
any party for loss occurring to the property described herein." Each party
hereto hereby waives all claims for recovery from the other party for any
loss or damage to any of its property insured under valid and collectible
insurance policies to the extent of any recovery collectible under such
insurance.
13. DAMAGE OR DESTRUCTION OF PREMISES: If the part of the Buildings
located on the Premises shall be damaged by fire or other
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casualty during the term of this Lease, the following terms and conditions
shall apply:
(a) If part of the Buildings on the Premises is damaged by fire or
other casualty during the term or any extended term of this Lease, so that it
can, with reasonable diligence, be repaired within sixty (60) days and
entirely from the insurance proceeds available to Landlord, the Landlord
shall have that part of the Buildings repaired as quickly as is reasonably
possible and the rent shall be abated for such time and as to the extent that
the Premises remains unfit for occupancy with respect to the intended use by
Tenant. In no event shall Landlord be required to repair the improvements
upon the leased Premises at a cost greater than the insurance proceeds
available to Landlord.
(b) If, during the term of this Lease, part of the Buildings the
Premises are damaged by fire or other casualty, so that it cannot, with
reasonable diligence, be repaired within the time and in the manner and
entirely from the insurance proceeds as set forth in sub-section (a) above,
then either Landlord or Tenant may, at its option, notify the other party in
writing of its intention to terminate said lease, said notice of termination
to be given within fifteen (15) days of the date of the fire or other
casualty, and Tenant shall not thereafter be responsible for the rent. In
the event that either Landlord or Tenant exercises the foregoing right to
terminate this Lease, the proceeds from the insurance policies provided for
under Paragraph 12 herein for the Premises shall belong to Landlord. The
proceeds from policies on
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Tenant's equipment, inventory, contents and personal property shall belong to
Tenant.
14. EMINENT DOMAIN: In the event the Premises shall be taken by or
pursuant to any governmental authority or through the exercise of the right
of eminent domain, Landlord and Tenant shall join and cooperate in resisting
such proceeding if such resistance is feasible and desirable to Tenant and,
if it is not, shall join and cooperate in prosecuting their respective claims
for damages incurred from the successful exercise of such right or proceeding.
If the whole of the Premises shall be taken or condemned by any
competent authority for any public use or purpose during the term of this
Lease, all obligations of the Tenant shall cease upon the date of the taking
and any unearned rent paid by Tenant shall be refunded. So much of the award
as represents the value of the land and the Buildings and improvements shall
belong to Landlord. Tenant shall be entitled to all other damages which may
be awarded based upon loss of its leasehold interest, signs, equipment or
interruption of business.
In the event that a part of the Premises shall be taken or condemned,
and the taking in any other way reduces or damages the Premises to an extent
that it may not be effectively used for the purposes hereof; then and in any
such event the Tenant may, at any time either prior to or within a period of
thirty (30) days after the date when possession of the Premises shall be
required by the condemning authority, elect to terminate this Lease. The
separate awards shall belong to Landlord and Tenant respectively as
hereinbefore set forth.
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In the event that Tenant shall fail to exercise any such option to terminate
this Lease, or in the event that a part of the Premises shall be taken or
condemned under circumstances under which the Tenant will have no such
option, then in either such event this Lease shall continue in effect with
respect to the portion of the Premises not so taken, and Tenant will, with
all due diligence and with all proceeds of the award available for the
Buildings and improvements, repair and restore the Premises or what may
remain thereof to their former condition. Any remaining part of the award
shall be divided between Landlord and Tenant as hereinbefore set forth with
respect to a taking of the whole of the Premises. Upon the completion of
such work, the monthly rent due Landlord under this Lease shall be reduced to
reflect any loss sustained in area and usability. In the event that
agreement is not reached with respect to reduced rent, an appraisal shall be
made by a competent appraiser selected by Landlord and Tenant, and the
reduced rental shall be the amount determined by the appraiser to be the fair
market rental.
15. INDEMNITY-LIABILITY INSURANCE: Tenant agrees to save Landlord
harmless and to indemnify Landlord from and against any and all claims by or
on behalf of any person or entity arising from or relating to (i) Tenant's
use, occupancy, conduct, operation or management of the Premises during the
term or (ii) any work or thing whatsoever done or not done on the Premises by
Tenant or any of its agents, contractors, servants, employees, licensees or
invitees during the term, or (iii) any breach or default by Tenant in
performing any of its obligations under the provisions of this Lease or
applicable law, or (iv) any negligent,
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tortious or other act or omission of Tenant or any of its agents,
contractors, servants, employees, licensees, or invitees (while on the
Premises or on the parking area) during the term or any extended term of this
Lease, as well as from and against all expenses and liabilities incurred in
connection with any such claim or any action or proceeding brought thereon
(including, by way of example rather than of limitation, the fees of
attorneys, litigation expenses, investigations and experts), all regardless
of whether such claim is asserted before or after the expiration of the term
or any earlier termination of this Lease. Tenant shall provide and keep in
force during the term of this Lease and any extension of said term for the
mutual benefit of Landlord and Tenant, commercial general liability insurance
against claims for bodily injury, death or property damage with respect to
the Premises and parking area, as the case may be, with the other party named
as an additional insured, such insurance to afford minimum protection of not
less than Two-Million Dollars ($2,000,000.00) combined single limit coverage
per occurrence, in form approved by Landlord. Tenant shall provide, also,
Worker's Compensation insurance to comply with applicable state law. Any of
such insurance may be carried under a blanket policy covering the Premises
and other locations of Tenant. Certificates of all policies of insurance
shall be delivered to Landlord or a party designated by Landlord upon written
request.
16. DEFAULT OF TENANT:
(a) If Tenant shall fail to pay any installments of rent when due or
fail to keep and perform any other covenant of this Lease and if
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Tenant shall continue in any such failure or default for a period of fifteen
(15) days in the event of non-payment of rent or thirty (30) days in the
event of any other default after Landlord has given Tenant written notice
thereof and demand for payment of rent or correction of default, as the case
may be, Landlord may reenter the Premises and take possession of the same,
including the Buildings, parking area, improvements and attached fixtures,
other than the removable trade fixtures and equipment, either with or without
process of law, and expel Tenant therefrom without prejudice to any other
legal or equitable remedies available to Landlord. No such entry by
Landlord, either with or without process of law, shall bar Landlord from the
recovery of damages as hereinafter set forth. If any default shall occur
(other than in the payment of rent) which cannot with due diligence be cured
within a period of thirty (30) days, and Tenant, prior to the expiration of
thirty (30) days from and after the giving of notice as aforesaid, commences
to eliminate such default and proceeds diligently to take steps to cure the
same, Landlord shall not have the right to reenter as hereinbefore provided.
(b) If Landlord elects to reenter, as herein provided, or should
take possession of the Premises, Buildings and parking area pursuant to legal
proceedings or pursuant to any notice provided for by law, Landlord may
either terminate this Lease or may, from time to time without terminating
this Lease and to mitigate damages, make such alterations and repairs as may
be necessary in order to relet the Premises, and relet said Premises or any
part thereof for such term or terms and at such rental and upon such other
terms and conditions as
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Landlord may deem advisable; and, upon each such reletting, all rental
received by Landlord from such reletting shall be applied, first, to payment
of any indebtedness other than rent due hereunder from Tenant to Landlord;
second, to the payment of any costs and expenses of any such reletting,
including attorney's fees and costs of such alterations and repairs; third,
to the payment of rent due and unpaid hereunder, and the residue, if any,
shall be held by Landlord and applied in payment of future rent as the same
may become due and payable hereunder. If such rentals received from such
reletting during any month be less than that to be paid during that month by
Tenant hereunder, Tenant shall pay any such deficiency to Landlord. Such
deficiency shall be calculated and paid monthly by Tenant within ten (10)
days after the receipt of said calculation from Landlord. If such deficiency
be not paid, Landlord may ▇▇▇ monthly, periodically or at the end of the term
to recover the same with the other charges set forth herein, as Landlord may
elect. No such reentry or taking possession of said Premises by Landlord
shall be construed as an election on its part to terminate this Lease unless
a written notice of such intention be given to Tenant by Landlord.
Notwithstanding any such reletting without termination, Landlord may at any
time thereafter elect to terminate this Lease for such previous breach. If
Landlord at any time terminates this Lease for any breach, it shall be
entitled to recover from Tenant the costs of recovering the Premises,
reasonable attorney's fees and the worth at the time of such termination of
the excess, if any, of the amount of rent and charges reserved in this Lease
for the remainder of the term for which Tenant is
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obligated over the then reasonable rental value of the Premises for the
remainder of the term for which Tenant is obligated.
17. BANKRUPTCY: In the event Tenant shall file a voluntary petition
in bankruptcy, or be by any court adjudicated a bankrupt or insolvent, or
shall be placed in liquidation or reorganization, or a temporary or permanent
receiver or trustee of Tenant's property shall be appointed by any court, or
if Tenant shall make a general assignment, or if any execution or attachment
shall be issued against Tenant, or any of Tenant's property, whereby the
Premises shall be taken or occupied or attempted to be taken or occupied by
someone other than Tenant, or if this Lease or any part thereof shall, by
operation of law, devolve upon or pass to any person or persons other than
Tenant, then Landlord shall have the right, at its option, to declare this
Lease terminated, and from thenceforth it shall be lawful for Landlord to
reenter and repossess itself of the Premises by force or otherwise and to
dispossess and remove therefrom Tenant its legal representatives or other
occupants thereof, and their effects, and to hold the same as if this Lease
had not been made, and the Tenant hereby expressly waives notice of intention
to reenter or instituting legal proceedings to that end.
18. ENVIRONMENTAL CONDITIONS COMPLIANCE: Tenant shall not (either with
or without negligence) cause or permit the escape, disposal or release of any
biologically active or other hazardous substances or materials in any manner
not sanctioned by law or by the highest standards prevailing in the industry
for the storage and use of such substances or materials, nor allow to be
brought into the Premises (as defined below)
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any such materials or substances. Tenant covenants and agrees that it will
do nothing that would cause the Premises to be in violation of existing or
hereafter enacted statutes, laws, rules, ordinances, or orders, permits, and
regulations of all state, federal, local, and other governmental and
regulatory authorities, agencies, and bodies applicable to the Premises,
pertaining to environmental matters, or regulating, prohibiting or otherwise
having to do with petroleum asbestos and all other toxic, radioactive, or
hazardous substances or material.
As used in this Lease, the term "hazardous substance' means any
substance, element, compound, mixture, solution, waste, pollutant,
contaminant or material that: (i) is designated, defined or listed; (ii) has
characteristics identified; or (iii) is considered hazardous, dangerous or
toxic in, under or pursuant to any of the following; (a) the Federal Water
Pollution Control Act; (b) the Comprehensive Environmental Response,
Compensation and Liability Act, (c) the Solid Waste Disposal Act, (d) the
Clean Air Act, (e) the Clean Water Act, (f) any "Superfund" or "Superlien"
law, and (g) any other laws now or hereafter in effect. All hereinafter
collectively referred to as the "Laws".
The term "hazardous substance" also means: (a) any imminently
hazardous, dangerous or toxic substance, element, compound, mixture,
solution, waste, pollutant, contaminant or material that is subject to any
action taken in, under or pursuant to the Toxic Substances Control Act; (b)
any petroleum products or byproducts, including crude oil or any fraction
thereof and any other liquid hydrocarbon, which is not specifically
designated, defined or listed, or has no characteristics
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identified in, under or pursuant to any Laws, as well as natural gas, natural
gas liquids, liquified natural gas, synthetic gas usable for fuel and any
mixtures of any such natural gas or synthetic gas; and (c) any other
substance, element, compound, mixture, solution, waste pollutant, contaminant
or material which may pose a threat or risk of harm to human health property,
the environment or the surface, soils, geologic materials, groundwater or air
in, at, on, under, about or surrounding the Premises or Buildings or parking
area.
Tenant shall hold Landlord free, harmless, and indemnified from any
penalty, fine, claim, demand, liability, cost, or charge of any kind
whatsoever which Landlord shall incur, or which Landlord would otherwise
incur, by reason of Tenant's failure to comply with any of the provisions
herein, including, without limitation, (1) the cost of bringing the Premises
into compliance with all Laws; (2) the cost of all appropriate or necessary
tests and examinations of the Premises to confirm that the Premises have been
brought into compliance with all Laws; and (3) the fees and expenses of
Landlord"s attorneys, engineers, and consultants incurred by Landlord in
enforcing or confirming compliance with the provisions herein.
For the purpose of applying the covenants herein, the Premises shall
also mean, refer to and include that part of the Buildings on the Premises,
and all improvements thereon; all personal property used in connection with
the Premises and parking area (including that owned by Tenant); and the soil,
ground water, and surface water of the parking area described in this Lease.
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The foregoing covenants and undertakings of Tenant contained herein
shall nevertheless not apply to any condition or matter constituting a
violation of any Laws: (1) which existed prior to the commencement of
Tenant's use or occupancy of the Premises or parking area or was not caused,
in whole or in part, by Tenant or Tenant's agents, representatives,
employees, officers, partners, contractors, licensees, or invitees; or (2) to
the extent such violation is caused by the willful acts or negligence of
Landlord or Landlord's agents, representatives, employees, officers,
partners, contractors, licensees, or invitees.
The covenants contained herein shall survive the expiration or
termination of this Lease, and shall continue for so long as Landlord and its
successors and assigns may be subject to any expense, liability, charge,
penalty, or obligation against which Tenant has agreed to indemnify Landlord
under the terms hereof.
19. ASSIGNMENT AND SUBLETTING: Tenant may not, without the prior
written consent of Landlord, sublet, assign or transfer this Lease to any
person, natural or corporate, whomsoever. In such event, however, Tenant
shall remain primarily liable for the keeping and performance of all its
covenants hereunder, including, but not limited to the prompt and due payment
of rent. The consent of Landlord shall not be unreasonably withheld, but it
is agreed that the withholding of consent because of any sublessee, assignee
or transferee engaging in a hazardous activity or creating additional expense
to the Landlord shall not be deemed unreasonable.
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19.01 PERMITTED ASSIGNEES: Notwithstanding the provisions of Paragraph
19, and provided Tenant is not in default under any term or condition of this
Lease, this Lease may be assigned to any corporation into or with which
Tenant may be merged or consolidated or to any corporation which shall be an
affiliate, subsidiary, parent or successor of Tenant, or of a corporation
into or with which Tenant may be merged or consolidated, or to a partnership,
the majority interest in which shall be owned by stockholders of Tenant or of
any such corporation. If there shall be an assignment to a corporation or
partnership, referred to in the immediately preceding sentence, the
provisions of Paragraph 19 with respect to assignment or subletting, shall
then apply to such corporation or partnership.
For the purpose of this Section a "subsidiary" or "affiliate" or a
"successor" of Tenant shall mean the following:
(a) An "affiliate" shall mean any corporation which, directly or
indirectly, controls or is controlled by or is under common control with
Tenant. For purpose, "control" shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management
and policies of such corporation whether through the ownership of voting
securities or by contract or otherwise.
(b) A "subsidiary" shall mean any corporation not less than fifty
percent (50%) of whose outstanding stock shall, at the time, be owned
directly or indirectly by Tenant.
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(c) A "successor" of Tenant shall mean:
(i) A corporation in which or with which Tenant, its corporate
successors or assigns is merged or consolidated, in accordance with
applicable statutory provisions for merger or consolidations of corporation,
provided that by operation of law or by effective provisions contained in the
instruments of merger or consolidation, the liabilities of the corporations
participating in such merger or consolidation are assumed by the corporations
surviving such merger or created by such consolidation, or
(ii) A corporation acquiring this Lease and the term hereby
demised and a substantial portion of the property and assets or stock of
Tenant, its corporate successors or assigns, or
(iii) Any corporate successors to a successor corporation becoming
such by either of the methods described in (i) or (ii), provided that on the
completion of such merger, consolidation, acquisition, or assumption, the
successor shall have a net worth of no less than Tenant's net worth
immediately prior to such merger, consolidation, acquisition or assumption.
Acquisition by Tenant or its corporate successors of a substantial
portion of the assets, together with the assumption of all or substantially
all of the obligations and liabilities of any corporation, shall be deemed a
merger of such corporation into Tenant for the purpose of this Paragraph.
Any assignment pursuant to this Paragraph 19.01 shall not release Tenant
of its liability under this Lease.
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20. WAIVER: Any waiver at any time of any breach of any condition of
this Lease shall extend only to the particular breach so waived and shall not
impair or affect the existence of such condition or the right of Landlord
thereafter to avail itself of any remedies for any breach thereof subsequent
to any such waiver. Failure or neglect of Landlord to act upon a breach of
one or more of the covenants, terms and conditions of this Lease shall not be
construed as a waiver of such breach or any subsequent breach or of any right
created thereby.
21. RIGHTS OF PARTIES: Each and every provision of this Lease shall
bind and inure to the benefit of the parties hereto, their legal
representatives, heirs, successors and assigns. All provisions of this Lease
apply in the plural sense where there is more than one Landlord and
corporations, associations, partner-ships, individual males or females, shall
be deemed fully included, and the neuter pronouns shall be construed to mean
masculine or feminine, singular or plural, where such construction is
necessary to make any provisions of this Lease applicable to any person,
persons, firms, corporation, association, thing or act at any time.
22. NOTICES: All notices authorized or required to be given to
Landlord shall be in writing and shall be deemed to have been given when
mailed by certified or registered mail with prepaid postage addressed to:
▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and those authorized or required to be given to Tenant shall
be in writing and shall be deemed to have been given when mailed in the same
manner to B & L Sportswear, Inc., 4600 East 48th
- ▇▇ -
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇, subject to the right of either Landlord or
Tenant to designate by notice in writing a new address to which said notices
or demands must be sent.
23. RECORDATION OF MEMORANDUM OF LEASE: Upon the request of either
Landlord or Tenant, the other party will in good faith cooperate in the
preparation and execution of a recordable instrument describing the parties,
the leased Premises, any easement in connection therewith, any restrictions,
the basic terms of this Lease and such other portions hereof as either party
may desire to be included in such instrument. The cost of preparing and
recording such instrument shall be paid by the requesting party.
24. END OF TERM, HOLDING OVER AND ATTORNEY'S FEES: Upon the expiration
of the term or other termination of this Lease, tenant shall quit and
surrender to landlord the Premises, broom clean and in as good order and
condition as the Premises were at the time of Tenant's occupancy thereof,
ordinary wear and tear, damage by fire or other casualty not caused by
Tenant, its servants, agents or employees and alterations, additions and
improvements to the Premises consented to in writing by Landlord excepted,
and Tenant shall remove from the Premises all of its property.
If Tenant shall hold over after the expiration of the term or other
termination of this Lease, such holding over shall not be deemed to be a
renewal of this Lease but shall be deemed to create a tenancy from
month-to-month and by such holding over Tenant shall be deemed to have
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agreed to be bound by all of the terms and conditions of this Lease except as
to the term hereof.
If any rent owing under this Lease is collected by or through an
attorney-at-law, Tenant agrees to pay Landlord's reasonable attorney's fees
not in excess of fifteen (15%) percent (or if the statutes or other laws of
the State of North Carolina in effect at the time of such collection limit
the amount so payable as attorney's fees, then the maximum percentage not in
excess of fifteen (15%) percent allowed by such laws or statutes) of the
amount so collected. The provisions of this Paragraph 24 do not exclude
Landlord's rights of re-entry or any other right reserved hereunder.
25. SUBORDINATION: Tenant agrees that this Lease is and shall remain
subject and subordinate to and may be assigned as security for any present
and all future mortgages or deeds of trust which may now or hereafter affect
this Lease or the Buildings or the real property upon which the Buildings is
located and to and for all renewals, modifications, consolidations,
replacements and extensions thereof. This clause shall be self-operative and
no further instrument shall be necessary to effect such subordination;
however, Tenant shall execute promptly and deliver to Landlord any such
certificate or certificates in writing as Landlord may request evidencing the
subordination of this Lease to or the assignment of this Lease as additional
security for such mortgage or deed of trust. Landlord, however, shall
exercise its best efforts to arrange with such mortgagee for an agreement
providing that if, by foreclosure or otherwise, such holder, or any successor
in
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interest comes into possession of the Premises, becomes the owner of the
Premises, or takes over the rights of Landlord in the Premises, it will not
disturb the possession, use or enjoyment of the Premises by Tenant, its
successors or assigns, or disaffirm this Lease or Tenant's rights or estate
hereunder so long as Tenant's obligations are fully performed in accordance
with terms of this Lease.
26. TENANT'S OPTION TO PURCHASE:
(a) OPTION TO PURCHASE: Landlord grants to Tenant the option to
purchase the Premises at the time, for the consideration, and upon the terms
and conditions set forth below.
(b) OPTION DATE, TERM: Tenant may purchase the Premises only on
the option date. For the purposes of this option, the term "option date"
shall be a date thirty (30) days from the date Landlord notifies Tenant of
Landlord's election not to construct structural additions requested by Tenant
as provided in Paragraph 6(b) of this Lease.
(c) EXERCISE OF OPTION: Tenant's election to exercise this option
must be evidenced by a written notice to Landlord not less than thirty (30)
days prior to the option date, which notice shall be deemed to have been
given when mailed by registered or certified mail, with postage prepaid, to
the address of Landlord set forth in Paragraph 22, or any other new address
which has been designated in writing to which notices may be sent as
provided in said Paragraph 22.
(d) OPTION PRICE: The price to be paid by Tenant to Landlord for
the Premises, if the option is exercised, shall be $714,902.85, plus
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the cost to Landlord of any structural additions made by Landlord pursuant to
Paragraph 6(b), plus ten percent (10%) of the costs to Landlord of said
structural additions.
(e) EXPENSES, MORTGAGE: The option price to be paid to Landlord,
as provided above, shall be a net amount to Landlord and all expenses in
connection with the transfer of the Premises, including, but not limited to,
title insurance, recording fees, documentary stamps, and all other closing
costs, shall be paid by Tenant. The option price, reduced by the amount of
any existing mortgage, shall be paid by Tenant in cash to landlord
concurrently with the conveyance of the Premises by Landlord to Tenant.
(f) TRANSFER OF TITLE: Except as provided below, Landlord shall
convey the Premises to Tenant free and clear of any mortgage or other
encumbrance. Any such transfer shall be effected by a warranty deed
containing special covenants of warranty by Landlord.
(g) FIRST DEED OF TRUST: Tenant's rights under this option are
and shall be subject and subordinate to any deed of trust constituting a
first lien on the Premises, or any part thereof, whether such deed of trust
has heretofore been, or may hereafter be, placed upon the Premises to secure
an indebtedness to any savings bank, bank, trust company, or other
institutional lender, private or public, and to any renewal, modification,
consolidation, replacement, or extension of any such deed of trust. This
subordination is limited and relates only to a first mortgage securing an
indebtedness that will not on any option date exceed the price at which this
option may then be exercised on that
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date, as herein provided. This subordination shall be self-operative and no
further instrument of subordination shall be required. Tenant shall,
nevertheless, execute and deliver, from time to time, any instrument and
certificate affirming and confirming such subordination that Landlord may
reasonably request. Landlord will cause any such deed of trust to contain
provisions requiring the holder of the indebtedness secured by deed of trust
to mail to Tenant by registered mail, addressed to Tenant at its office as
set forth in this Lease, a copy of each notice of breach of covenant,
default, or foreclosure given by the holder or the trustee under such deed of
trust to Landlord. Notwithstanding the provisions of Paragraph 26(b), Tenant
may, upon receiving notice of breach of covenant, default or foreclosure,
under such deed of trust, exercise the option for the price and upon such
other terms set forth in this Paragraph 26.
(h) PERFORMANCE OF LEASE: The right to exercise this option is
conditioned upon the faithful performance by Tenant of all its covenants,
conditions, and agreement under this Lease, and the payment by Tenant of all
rent and any other special payments as provided in this Lease to the date of
the completion of the purchase of the property by Tenant.
(i) ADJUSTMENTS: Adjustments and prorations of taxes, insurance
premiums, and similar items shall be made as of the date of the closing of
title.
(j) ASSIGNMENT: Tenant may not assign its rights under this
option separately from all of its other rights under this Lease.
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(k) TERMINATION: If this Lease expires or is terminated in any
manner or for any reason (except as the result of Landlord's failure to
perform its covenants thereunder), all of Tenant's rights under this option
shall cease, and this option shall be void. This provision shall be
applicable in all events, and despite a separate assignment by Tenant of its
rights under this option.
27. ATTORNEYS FEES, COSTS: If suit shall be brought for recovery of
possession of the Premises, rent or any other amount due under the provisions
of this Lease, or due to a breach of any covenant herein contained on the
part of Tenant or Landlord to be kept or performed, and a breach shall be
established, the prevailing party shall be entitled to its reasonable and
necessary expense incurred therefor, including reasonable attorney's fees and
court costs.
28. JUDICIAL INTERPRETATION: Not withstanding the presumption of law
whereby an ambiguity or conflict in provisions shall be construed against the
drafter, the parties hereto hereby agree that although one party may have
generated this Agreement, both parties have been represented by counsel, this
Agreement has been heavily negotiated, and they have equally participated in
the drafting of this Agreement. Therefore, such presumption shall not be
applied if any provision or term of this Agreement required judicial
interpretation.
IN WITNESS WHEREOF, Landlord and Tenant have each executed or caused
this Lease Agreement to be executed in duplicate originals in their behalf in
the manner prescribed by law.
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LANDLORD:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ (SEAL)
--------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (SEAL)
--------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
TENANT:
B & L SPORTSWEAR, INC.
ATTEST: BY: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
Vice President
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------
Secretary
(CORPORATE SEAL)
NORTH CAROLINA
COUNTY OF ▇▇▇▇
I, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, a Notary Public of the County and State aforesaid,
certify that ▇▇▇▇▇ ▇. ▇▇▇▇▇ AND ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, personally appeared before
me this day and acknowledged the execution of the foregoing Lease Agreement.
WITNESS my hand and notarial stamp or seal, this 24th day of March, 1998.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
Notary Public
My Commission Expires: 6/30/01
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State of Colorado
COUNTY OF DENVER
I, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, a Notary Public of the County and State aforesaid,
certify that ▇▇▇▇▇ ▇▇▇▇▇, personally appeared before me this day and
acknowledged that he/she is Secretary of B & L SPORTSWEAR, INC., a North
Carolina corporation, and that by authority duly given and as the act of the
corporation, the foregoing Lease Agreement was signed in its name by its VICE
President, sealed with its corporate seal and attested by himself/herself as
its Secretary.
WITNESS my hand and notarial stamp or seal, this 27th day of March, 1998.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------
Notary Public
My Commission Expires: 8/2/99
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