COMMERCIAL LEASE
THIS INDENTURE WITNESSETH, that D.I. South, Inc., an Indiana
corporation, LEASES TO: Solpower Corporation, a Nevada corporation, with offices
at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, hereafter referred to
as "Lessor", for and in consideration of the covenants and agreements
hereinafter mentioned, the premises in Elkhart County, State of Indiana, known
and described as follows:
See attached Exhibit "A"
To have and to hold the same unto the lessee from June 1, 1998, to and
including May 31, 2003, and the lessee, in consideration of said demise, does
covenant and agree with the lessor as follows:
1. The Lessee hereby represents that he will use said premises for the
following described purposes and for no other purposes whatsoever:
2. To pay as rent for said leased premises the sum of [see paragraph
#21] dollars payable as follows:
without notice or demand, each installment to be paid in advance upon the first
day of each installment period to the Lessor or at such other place as the
Lessor may from time to time designate in writing.
3. That the Lessee has examined and knows the condition of said
premises and has received the same in good order and repair, except as herein
otherwise specified, and that no representations as to the condition of repair
thereof have been made by the Lessor or his representative, prior to or at the
execution of this lease that are not herein expressed or endorsed herein; and
that Lessee will keep the interior and exterior of said premises in good repair,
including the roof and walls, replacing all broken glass with glass of the same
size and quality as that broken, and will keep said premises and appurtenances,
as well as all ▇▇▇▇▇, downspouting, catch basins, drains, stools, lavatories,
sidewalks, adjoining alleys and all other facilities and equipment in connection
with said premises, in a clean and healthy condition, according to the city
ordinances, and the direction of the proper public officers, during the term of
this lease, at his own expense; and upon the termination of this lease in any
way, will yield up said premises to Lessor in good condition and repair (loss by
fire and ordinary wear excepted) and will deliver the keys to Lessor.
4. That Lessor shall not be liable for damage caused by hidden defects
or failure to keep said premises in repair, and shall not be liable for ny
damage done or occasioned by or from plumbing, gas, water, steam, or other
pipes, or sewerage, or the bursting or leaking of plumbing or of any plumbing or
heating fixtures or waste or soil pipe existing in connection with said building
or premises, nor for damage occasioned by water, snow or ice being upon
sidewalks or coming through the roof, sky-light, trap door or otherwise, nor for
any damages arising from negligence of co-tenants or other occupants of the same
building, or the agents, employees or servants of any of them, or of any owners
or occupants of adjacent or contiguous property.
5. The Lessor shall not be liable for any injury to the Lessee or any
other person, occurring on or in front of said premises, irrespective of whether
said injury is caused by a defect in said premises or by reason of said premises
becoming out of repair or arising from any other cause whatsoever, and the
Lessor shall not be liable for damage to Lessee's property or to the property of
any other person which may be located in or upon said premises and the Lessee
agrees to indemnify and save harmless the Lessor from any and all claims arising
out of injuries to persons or property occurring on or about said premises.
6. That the Lessee will not allow said premises to be used for any
purpose that will increase the rate of insurance thereon, nor to be occupied in
whole or in part by any other person, and will not sublet the same or any part
thereof, nor assign this lease or any part thereof without, in each case the
written consent of the Lessor first had and obtained, and will not permit any
transfer, by operation of law, of any interest in said premises acquired through
this lease, and will not permit said premises to be used for any unlawful
purpose or purpose that will injure the reputation of the same or of the
building of which it is a part, nor disturb the tenants of such building or of
the neighborhood and will not allow any sign or placards posted or placed
thereon; except by written consent of the Lessor.
7. That no alterations, changes or additions in said leased premises
shall be made without first submitting written plans and specifications for the
same to the Lessor and obtaining his written consent to make the same. In the
event of any such remodeling, alterations or additions that Lessee shall make
the same at his own expense and shall promptly pay for all materials and labor
involved in making the same. Lessee shall not permit any liens or claims or
demands of any nature to exist against the Lessor or the leased premises. In the
event any lien, claim or demand or any action for enforcing the same shall be
filed or made against the Lessor or said premises, the Lessee shall defend the
same at his own expense and Lessee hereby agrees to indemnify and hold harmless
the Lessor from any and all liability or expense arising by virtue of such
claim, demand or lien or the defense of any action filed to enforce the same.
Any such alterations, changes or additions shall, when made, become a part of
said leased premises and remain thereon as the property of the Lessor at the
termination of said lease at the option of the Lessor. If the Lessor shall
require the Lessee to restore the premises to the original condition in which it
was before this lease is executed, then the Lessee shall restore said premise to
such condition at his own expense, and all of the provisions of this lease with
reference to such restoration contracts, liens, demands and expenses shall apply
to said restoration as well as the original alterations.
8. To allow Lessor free access to the premises for the purpose of
examining or exhibiting the same and also to allow the Lessor to place upon said
premises, at any and all times, "For Sale" signs, and within ninety (90) days of
the termination of this lease "For Rent" signs.
9. Lessee shall promptly pay and discharge all store license taxes and
all general property taxes or special license fees that may be assessed or
levied by any lawful authority against the property of Lessee or any sub-tenants
on, against, or by virtue of the business conducted in or on the demised
premises during the term of this lease.
10. Lessee shall promptly pay (in addition to the rents above
specified) all water, sewerage, electric, power, gas and heating bills taxed,
levied, or charged against the premises for and during the term of this lease.
11. Lessee covenants that should he make default in his agreement to
pay the rent above provided to be paid, or any part thereof, or in any of the
other covenants and agreements herein
2
contained, he will at once deliver peaceable possession of said premises to the
Lessor, and, failing to do so, it shall be lawful for the Lessor, his heirs or
assigns, without notice, to declare said term ended, and to reenter said demised
premises, or any part thereof, either with or without process of law, and to
expel, remove and put out the Lessee, or any person or persons occupying the
same, using such force as may be necessary so to do, and to repossess and use
said premises as before this demise, without prejudice to any remedies which
might otherwise be used for arrears of rent or preceding breach of covenants,
and Lessee further covenants and agrees, that Lessor shall have, at all times,
the right to distrain for rent due, and shall have a valid and first lien upon
all property of Lessee whether exempt by law or not, as security for the payment
of the rent herein covenanted to be paid.
12. That after the service of notice, or the commencement of a suit, or
after final judgement for possession of said premises, Lessor may receive and
collect any rent due and the payment of said rent shall not waive or affect said
notice, said suit or said judgement.
13. If the Lessee shall make any assignment for the benefit of
creditors or if a receiver is appointed for the Lessee or his assets or of the
Lessee's interest under this lease, and if the appointment of such receiver is
not vacated within five (5) days, or if a voluntary or involuntary petition is
filed by or against Lessee under the Bankruptcy Act, the Lessor may, upon giving
the Lessee ten (10) days notice of such election, either terminate Lessee's
right to the possession of the demised premises or terminate this lease as in
the case of a violation by the Lessee of any of the terms, covenants or
conditions of this lease.
14. It is agreed by the parties hereto that in the event Lessee is
declared bankrupt or voluntarily offers to creditors terms of composition or in
case a receiver is appointed to take charge of and conduct the affairs of the
Lessee, then Lessor shall have the right of immediate possession of said
premises.
15. That in case said premises shall be so injured by fire, windstorm
or other catastrophe as to be rendered untenantable, and shall not be repaired
by the Lessor and rendered tenantable within ninety (90) days thereafter, it
shall be optional with either party hereto to terminate the lease by written
notice at the end of such ninety (90) days, in which case rent shall be paid at
the agreed rate above provided up to the time of such fire; but in case such
injuries are repaired and the premises rendered tenantable within ninety (90)
days, the right to terminate the lease for such cause shall not exist; provided,
that nothing herein contained shall relieve the Lessee from liability for rent
or damage where such damage or destruction shall be caused by the carelessness,
negligence or improper conduct of the Lessee, his agents or servants.
16. It is expressly agreed that no waiver nor apparent waiver, nor the
failure of Lessor to require strict performance of any condition, covenant or
agreement shall estop the Lessor from enforcing such condition, covenant or
agreement, nor any other condition, covenant or agreement shall at any time be
implied.
17. At the termination of this lease, by lapse of time or otherwise,
Lessee will yield up immediate possession to Lessor, and failing so to do, will
pay as liquidated damages for each day such possession is withheld, a sum equal
to five times the per them rental; but the Provisions of this clause shall not
be held as a waiver by Lessor of any rights of re-entry as herein set forth; nor
shall the receipt of said rent or any part thereof, or any other act in apparent
affirmance of tenancy, operate as a waiver
3
of the right to forfeit this lease and the term hereby granted for the period
still unexpired, for any breach of any of the covenants herein.
18. It is also agreed that the Lessee shall pay and discharge all
reasonable costs, attorney's fees and expenses that shall be made and incurred
by the Lessor in enforcing the covenants and agreements of this lease, including
the agreement to deliver possession (or any reason herein provided; and all the
parties to this Law agree that the covenants and agreements herein contained
shall be binding upon, apply and inure to their respective heirs, executors,
administrators, successors and assigns, and the terms "Lessor" and "Lessee"
shall embrace all of the parties hereto irrespective of number or gender.
19. It is agreed that all payments herein provided to be made shall be
made without relief from valuation or appraisement laws, and all payments
required to be made which shall not be made at the time due shall bear interest
at the ate of six per cent per annum from date of delinquency.
20. Clauses numbered 21-34 are hereby incorporated in and made a part
of this lease.
DATED THIS 1ST DAY OF JUNE, 1998.
D.I. SOUTH, INC., an IN corp. Solpower corporation, a Nevada
corporation
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------- ----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President ▇▇▇▇▇ ▇. ▇▇▇▇▇, President
Attest: Attest:
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------- ------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇, Secretary Secretary
LESSOR LESSEE
STATE OF INDIANA, ST. ▇▇▇▇▇▇ COUNTY, SS:
Before me, the undersigned, a Notary Public in and for said County and
State, this day of , 19 , personally appeared:
---- ------------------- ----
and acknowledged the execution of the foregoing lease. In witness whereof, I
have hereunto subscribed my name and affixed my official seal.
My commission expires , 19 .
------------------------- ----
4
Notary Public
This instrument was prepared by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇.
5
21. The rental due under this Lease shall be Two Thousand Five Hundred
($2,500.00) Dollars per month, payable an the first day of each and every month
during the term hereof, plus taxes and insurance. Thereafter the sum of Two
Thousand Five Hundred ($2,500.00) Dollars per month shall be considered the base
rental figure which shall be increased by any escalation in the Consumer Price
Index using 1982-84 equaling one hundred (100) as a base as it shall be
reflected for the month of June, 1998, and any escalation through the month of
May, 1999, and each year thereafter, or any renewal periods executed pursuant to
this lease. The Index shall be utilized by reference to "all items" and then
multiplying the escalation, if any, times the rental figure, the product of
which shall be the yearly rental due for the remainder of the term of the lease.
It is presently anticipated that the Bureau of Labor Statistics, United
States Department of Labor, will revise the Consumer Price Index and possibly
change the form or basis of calculating the Consumer Price index. If possible,
the parties agree that they will request the Bureau of Labor Statistics to make
available, for the life of this agreement, a monthly Consumer Price index in its
present form and calculated on the same basis as the Index for June, 1998. In
the event that the Consumer Price index in its present form shall not be
available, then, in that event, the successor index as maintained by the Bureau
of Labor Statistics as will closely correlate to the present Index shall be
utilized, either by the anticipated Consumer Price Index for all urban consumers
or the Consumer Price Index for urban wage earners and clerical workers.
In the event that there shall be no escalation in the Consumer Price
Index, or in the successor index, there shall be no reduction in the yearly and
monthly rental; however, the monthly rental shall remain the same.
22. Lessee shall have an option to renew this lease for an additional
period of five (5) years commencing with the expiration of the term granted
herein, and upon the same terms and conditions herein. Lessee shall give written
notice at least One Hundred Eighty-one (181) days prior to the expiration of the
term granted herein of its intention to exercise said option to renew under the
terms and conditions of this lease, The rental for the renewal term shall be on
the same basis as stated herein and the beginning renewal rental shall begin
with an amount equal to the last month Is rental due under the original term
plus any escalation in the Consumer Price Index. All escalations shall continue
to be effective throughout the renewal term on the same basis and at the same
times as if restated herein giving consideration to dates one (1) year
subsequent to the original dates.
23. This lease is executed by the respective President and Secretary of
the Lessee corporation and it is covenanted that they have full corporate
authority to act on behalf of the corporation in the execution of this lease.
24. Lessee may sublet the premises to its licensees d/b/a Solpower
Great Lakes and Solpower Southeast who will form a cooperative venture for the
blending of the Soltron additive. The portion to be sublet shall be the rear
area that is caged along with the ,adjacent clean room", two offices and a
sharing of common areas, rest rooms, entries, shipping areas and other necessary
portions.
25. Lessee has inspected all heat, electrical and utility systems and
agrees to make all necessary repairs at its expense. Any improvements or
additional services added during this lease shall be at the expense of Lessee
and shall remain at the end of the lease for Lessor's benefit at the Lessor's
6
option. All additional repairs, renovations and efforts made to bring any system
operational, are hereby assumed and agreed to be paid by the Lessee.
26. Lessee agrees to keep the premises heated to no less than 55
degrees throughout the entire premises.
27. Lessee shall pay its portion of taxes and insurance on the leased
premises on a monthly basis.
28. Lessee shall have the obligation of maintaining the grounds,
including mowing the grass, in addition to the interior portion of the premises,
and further shall have the duty in case of heavy snows that may begin to create
damage to the roof, to notify Lessor of the condition and make an effort to
obtain crews to remove the snow at Lessee's expense.
29. Lessee agrees to pay utilities used and consumed on the premises
when billed for the same by the utility company. All utilities shall be placed
in Lessee's name beginning at the execution of this lease.
30. Lessee shall be fully responsible for any and all losses of the
personal property located on the premises herein described and shall insure
against any loss arising out of damage to any personal property of third
parties, other than that of Lessee located on said premises, which insurance
shall indemnify and protect Lessor and Lessee against any liability and expense
arising therefrom. Lessee also agrees to insure Lessor's property situate in the
building.
It is further agreed and understood that the Lessee shall also insure
the building against loss or damage by fire or such other risks commonly insured
against in Elkhart, Indiana, including "all risk replacement cost coverage" in
an amount not less than Four Hundred Thousand ($400,000.00) Dollars, and any
such increases as market conditions might warrant from time to time at the
request of the Lessor, or increases as indicated by insurance carrier with whom
Lessee shall insure said building for the benefit of Lessor.
Lessee shall, at its own expense, carry with a responsible insurance
company or companies approved by Lessor throughout the term of this lease or any
extension thereof, the usual standard type insurance indemnifying and protecting
Lessee and Lessor against losses and damages arising out of Lessee's failure to
maintain the premises to the extent that they are obligated to do so herein, and
arising out of any accident in and about the said premises or due to any act of
negligence of the Lessee or any of its agents or employees. Lessee hereby agrees
that the limits of such insurance shall be Twenty-five Thousand ($25,000,00)
Dollars for bodily injury and medical payments in the aggregate and Five Hundred
Thousand ($500,000.00) Dollars for damage to property.
Lessee shall provide Lessor with copies of all of the insurance
policies required hereunder evidencing compliance with the requirements
contained herein and indicating that both Lessor and Lessee are insured against
the losses set forth herein.
31. If any default shall be made in the payment of rent or any part
thereof at the time provided, or if Lessee shall abandon or vacate the premises,
or shall become bankrupt, or shall make a general assignment for the benefit of
creditors, or if, after twenty days' written notice setting forth the default,
default shall continue by Lessee in the performance or observance of any other
covenant, term
7
or condition herein contained to be performed on Lessee's part, Lessors may at
their election terminate this lease by giving Lessee written notice thereof; and
thereupon Lessee may, with or without demand, re-enter and take possession and
distraint of the premises, and in either case, Lessee shall peacefully surrender
possession thereof to Lessors, and all rights and interests of Lessee to
possession and control hereunder shall cease and terminate, but nothing herein
contained shall affect Lessors' right to the rental for the term herein
specified. Upon taking possession and distraint hereunder, Lessors may at their
election, terminate this lease by giving Lessee written notice thereof, or
Lessors may re-let said property and Lessee shall be liable for and will pay as
it accrues the difference in the rental for the balance of the term and all
other sums due under this lease.
32. Lessee shall be responsible for compliance with all state, federal,
city, and county rules and regulations and any cost resulting therefrom
pertaining to the use or occupancy of Lessee from the date of execution of this
Lease and thereafter. This shall include, but not be limited to, all existing
regulations, and all these promulgated in the future concerning any
environmental systems that need to be present on the premises for continuation
of Lessee's business. Additionally, Lessee shall be responsible for all
environmental cleanup and costs that is, or may become necessary for the use of
the building or premises by Lessee.
33. Lessee shall not assign this lease, in whole or in part, nor
sublease all or any part of the premises, nor permit other persons to occupy
said premises or any part thereof, nor grant any license or concession for all
or any part of said premises, without the prior written consent of Lessor, which
consent shall not be unreasonably withheld, provided that Lessor may
specifically withhold consent if the proposed transferee's projected use of the
premises involves the use, storage, generation or disposal of hazardous
substances as previously defined. Any consent by Lessor to an assignment or
subletting of this Lease shall not constitute a waiver of the necessity of
obtaining that consent as to any subsequent assignment. Any assignment for the
benefit of Lessee's creditors or otherwise by operation of law shall not be
effective to transfer or assign Lessee's interest in this Lease unless Lessor
shall have first consented thereto in writing. Neither Lessor's interest in this
Lease, nor any estate created hereby in Lessor nor any interest herein or
therein, shall pass to any trustee or receive or assignee for the benefit of
creditors or otherwise by operation of law except as may specifically be
provided in the Bankruptcy Code. If any of the corporate shares of stock of
Lessee are transferred, or if any partnership interests of Lessee are
transferred, by sale, assignment, bequest, inheritance, operation of law, or
otherwise, so as to result in a change of the control, assets, value, ownership,
or structure of Lessee, same shall be deemed an assignment for the purpose of
this section and shall require Lessor's prior consent, and Lessee shall notify
Lessor of any such change or proposed change.
34. (a) Lessee shall not cause or permit any hazardous material to be
brought upon, kept, or used in or about the premises by Lessee, its agents,
employees, contractors or invitees, without the prior written consent of Lessor
(which Lessor shall not unreasonably withhold as long as Lessee demonstrates to
Lessor's reasonable satisfaction that such hazardous material is necessary or
useful to Lessee's business and will be used, kept, and stored in a manner that
complies with all laws regulating any such hazardous material so brought upon or
used or kept in or about the premises). If Lessee breaches the obligations
stated in the preceding sentence, or if the presence of hazardous material on
the premises caused or permitted by Lessee results in contamination of the
premises, or if contamination of the premises by hazardous material otherwise
occurs for which Lessee is legally liable to Lessor for damage resulting
therefrom, then Lessee shall indemnify, defend, and hold Lessor harmless from
any and all claims, judgements, damages, penalties, fines, costs, liabilities or
losses (including, without limitation, diminution in value of the premises,
damages for the loss or restriction on use of rentable or useable
8
space or of any amenity of the premises, damages arising from any adverse impact
on marketing of space, and sums paid in settlement of claims, attorney's fees,
consultant fees and expert fees) which arise during or after the lease term as a
result of such contamination. This indemnification of Lessor by Lessee includes,
without limitation, costs incurred in connection with any investigation of site
conditions or any cleanup, remedial, removal or restoration work required by any
federal, state, or local governmental agency or political subdivision because of
hazardous material present in the soil or ground water on or under the premises.
Without limiting the foregoing, if the presence of any hazardous material on the
premises caused or permitted by Lessee results in any contamination of the
premises, Lessee shall promptly take all actions at its sole expense as are
necessary to return the premises to the condition existing prior to the
introduction of any such hazardous material to the premises; provided that
Lessor's approval of such actions shall first be obtained, which approval shall
not be unreasonably withheld so long as such actions would not potentially have
any material adverse long-term or short-term effect on the premises.
(b) As used herein, the term "hazardous material" means any hazardous
or toxic substance, material or waste which is or becomes regulated by any local
government authority, the State of Indiana, or the United States Government. The
term "hazardous material" includes, without limitation, any material or
substance that is (i) defined as a "hazardous substance" under Indiana statutes,
(ii) petroleum, (iii) asbestos, (iv) designated as a "hazardous substance"
pursuant to Section 311 of the Federal Water Pollution Control Act (33 U.S.C.
Section 1321), (v) defined as a "hazardous waste," pursuant to Section 1004 of
the Federal Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et
seq. (42 U.S.C. Section 6903), (vi) defined as a "hazardous substance" pursuant
to Section 101 of the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C. Section 9601 et seq. (42 U.S.C. Section 9601) , or
(vii) defined as a "regulated substance" pursuant to Subchapter IX, Solid Waste
Disposal Act (Regulation of Underground Storage Tanks) , 42 U.S.C. Section 6991
et seq.
9
EXHIBIT "A"
A part of the Southeast Quarter (SE 1/4) of Section Nineteen (19), Township
Thirty-eight (38) North, Range Five (5) East, in Osolo Township, Elkhart County,
Indiana, being more particularly described as follows:
Commencing at an iron stake marking the southwest corner of said quarter
section; thence due East, along the south line of said quarter section, and
along the center line of County Road Number Six (6), a distance of one thousand
seven hundred sixty-four (1,764) feet to the place of beginning of this
description; thence continuing due East, along the south line of said quarter
section, a distance of three hundred ninety-four and twelve hundredths (394.12)
feet to the point where said south line is intersected by the center line of
County Road Number Seven (7); thence North five (5) degrees fourteen (14)
minutes East, along the center line of said County Road Number Seven (7), a
distance of eight hundred thirty-three and forty-eight hundredths (833.48) feet
to a point where said center line is intersected by the south right-of-way line
of D.I. Drive, as said Drive is known and designated; thence ▇▇▇ ▇▇▇▇, along the
south right-of-way line of said D.I. Drive, a distance of four hundred
seventy-three and twenty-two hundredths (473.22) feet; thence South zero (0)
degrees thirteen (13) minutes East, parallel with the west line of said quarter
section, a distance of eight hundred thirty (830) feet to the place of
beginning, containing 8.262 acres, more or less.
EXCEPT:
A part of the Southeast Quarter (SE 1/4) of Section 19, Township 38 North, Range
5 East, situate in Osolo Township, Elkhart County, State of Indiana, and being
more particularly described as follows:
Assuming the South line of the Southeast Quarter (SE 1/4) of said Section 19 to
have a bearing of Due East and West: Beginning at a point on the South line of
the Southeast Quarter (SE 1/4) of said Section 19, that is Due East a distance
of 1764 feet from an iron stake marking the Southwest corner of the Southeast
Quarter (SE 1/4) of said Section 19; thence Due East along the South line of the
Southeast Quarter (SE 1/4) of said Section 19, a distance of 394.12 feet to the
centerline of County Road 7; thence North 5 degrees 14 minutes East along the
centerline of said County Road 7, a distance.of 620.59 feet; thence ▇▇▇ ▇▇▇▇ a
distance of 453.06 feet to an iron stake on grantor's West line, thence South 0
degrees 13 minutes East along grantor's West line, a distance of 618 feet to the
place of beginning of this description. Containing 6.00 acres of land.
SUBJECT to all taxes.
SUBJECT to all public highways.
SUBJECT to all easements and restrictions of record.
SUBJECT to all liens and encumbrances.
