EXHIBIT 10.43
LEASE
THIS LEASE, executed this 1st day of October, 1995, by and between
▇▇▇ ▇▇▇▇▇ ▇▇▇▇, Inc. (hereinafter referred to as the "Lessor"), and
THE COLONEL'S, INC., a Michigan corporation, of ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇▇▇▇ (hereinafter referred to as the "Lessee").
WITNESSETH
WHEREAS, the Lessor desires to lease to the Lessee and the Lessee
desires to lease from the Lessor the real property and improvements
commonly known as ▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, and further identified by its
legal description in Exhibit A; and
WHEREAS, the parties hereto wish to set forth other terms and
conditions relative to their business agreements;
NOW, THEREFORE, in consideration of the premises, the mutual covenants
herein contained and each and every act to be performed hereunder by either
of the parties, such parties enter in to the following Agreement:
ARTICLE I
The Demised Premises and the Term
SECTION 1.01. THE PROPERTY LEASED. The Lessor hereby lets and
demises to the Lessee, and the Lessee hereby leases from the Lessor, the
real property with all improvements and appurtenances described on Exhibit
A. The said real property and improvements and appurtenances to be leased
pursuant to this Agreement is sometimes hereinafter referred to as the
"Demised Premises".
SECTION 1.02. THE DEMISED TERM. To have and to hold the Demised
premises with the rights, privileges, easements and appurtenances thereto
attaching and belonging, to the Lessee, its successors and assigns, with a
quiet and undisturbed possession to Lessee, for a term beginning on October
1, 1995 and extending for 24 months from such date to and including
September 30, 2005 (such period being hereinafter referred to as the
"Demised Term").
ARTICLE II
The Demised Premises and the Term
SECTION 2.01. COVENANT. The Lessee covenants that it will pay the
rental set forth below for the Demised premises to the Lessor, at ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or at such other address that the Lessor
may specify from time to time.
SECTION 2.02. RENTAL. For the Demised Term the Lessee will pay to
the Lessor a rental of a monthly rent (hereinafter "Monthly Rent") of
$20,000 Dollars per month plus such other amounts as are set forth herein
on the first (1st) day of each month of the Demised term, except that the
$20,000 a month payment shall not commence until July 1, 1996.
ARTICLE III
Possession
SECTION 3.01. EFFECT OF HOLDING OVER. If Lessee remains in
possession of all or any part of the Demised Premises after the expiration
of the Demised Term, with the express or implied consent of Lessor, such
tenancy shall be month-to-month only and shall not constitute a renewal or
extension for any further term. If Lessor remains in possession either
with or without Lessor's consent, Monthly Rent shall be increased to an
amount equal to One Hundred Twenty-Five (125%) percent of the Monthly Rent
payable during the last month of the Demised Term, and any other sums due
under this Lease shall be payable in the amount and at the times specified
in this Lease. Such month-to-month tenancy shall be subject to every other
term, condition, and covenant contained herein. If Lessee remains in
possession without Lessor's consent, Lessee shall indemnify, defend and
hold Lessor harmless from all claims, costs and liabilities including
attorneys' fees and costs, arising from or in connection with Lessee
remaining in possession.
SECTION 3.02. QUIET ENJOYMENT. Lessor covenants that Lessee, upon
performing the terms, conditions and covenants of this Lease, shall have
quiet and peaceful possession of the Demised Premises as against any person
claiming the same by, through or under Lessor.
ARTICLE IV
Use of Demised Premises
SECTION 4.01. WASTE AND CONFORMANCE WITH LAWS. No waste or damage
shall be committed upon or to the Demised Premises. The Demised Premises
shall not be used for any unlawful purpose, and no violations of law shall
be committed thereon by Lessee or its employees. The Lessee shall at its
own cost and expense promptly comply with all laws, rules, orders,
ordinances and regulations of the federal, state and city governments and
any and all of their departments and bureaus and those of any other
competent authority relating to the use of the Demised Premises or to the
condition of the portion thereof which the Lessee is required to maintain.
SECTION 4.02. LESSEE'S USE. Lessee shall use the Demised Premises
solely for industrial use including warehouse and related office uses and
shall not use the Demised Premises for any other purpose without obtaining
the prior written consent of the Lessor.
SECTION 4.03. COMPLIANCE. Lessee shall not commit any public or
-2-
private nuisance or any other act of thing which might or would disturb the
quiet enjoyment of any other tenant or any occupant of nearby property.
Lessee shall place no loads upon the floors, walls or ceilings in excess of
the maximum designed load determined by Lessor or which endanger the
structure of the Demised Premises nor place any harmful liquids in the
drainage systems nor pump or store waste materials or refuse or allow such
to remain outside the building property, except in the enclosed trash areas
provided. Lessee shall not store or permit to be stored or otherwise place
any other material of any nature whatsoever outside the building.
(a) "Hazardous Material" shall mean any substance or material
which is capable of posing a risk of injury to health, safety or
property, including all of those materials and substances designated
as hazardous or toxic by any federal, state or local law, ordinance,
rule, regulation or policy.
(b) Lessee shall not introduce any Hazardous Material in, on or
adjacent to the Demised Premises without complying with all applicable
federal, state and local laws, ordinances, rules, regulations, and
policies relating to the release, storage, use, disposal,
transportation or clean-up of Hazardous Materials, including, but not
limited to, the obtaining of proper permits. Lessee shall immediately
notify Lessor of any release or contamination or any inquiry, test,
investigation, or enforcement proceeding by or against Lessee or the
Demised Premises concerning a Hazardous Material of which Lessee has
knowledge. If Lessee's release, storage, use disposal or
transportation of any Hazardous Material in, on or adjacent to the
Demised Premises results in any contamination of the Demised Premises,
or the sole, or surface or groundwater in or about the Demised
Premises, Lessee shall clean up all such contamination at its expense.
Lessee shall indemnify, defend and hold Lessor harmless from and
against any claims, suits, causes of action, costs, fees, including
attorneys' fees and costs, arising out of or in connection with (i)
any such contamination to the extent caused by the acts or omissions
of Lessee, its agents, employees, contractors, invitees or Subtenants,
(ii) any clean-up work, inquiry or enforcement proceeding arising out
of or in connection with such contamination, (iii) any Hazardous
Materials released, stored, used, disposed of, or transported by
Lessee or its agents, employees, contractors or invitees, or (iv) any
loss or damage to persons or property resulting from items (i) through
(iii) above. Lessee's obligations under this subparagraph shall
survive the termination of this Lease.
SECTION 4.04. EXISTING CONDITIONS. Tenant shall be responsible for
any remediation required for conditions which did or may have existed on
the premises before the term of this lease, as if those conditions were
ones caused or permitted by the Tenant under Section 4.03, except that
Tenant's liability under this sub-section (4.04) shall not exceed an
aggregate amount of $1,000,000.
-3-
ARTICLE V
Taxes
SECTION 5.01. TAXES AND ASSESSMENTS. Lessee shall be responsible for
and shall pay for all Michigan Single Business taxes, and all real and/or
personal property taxes assessed or due by any governmental authority for
the respective taxes assessed or due on the Demised Premises. Lessee shall
also pay prior to delinquency all real property taxes which are defined as:
Any form of assessment, license, fee, rent tax, levy, penalty (if a result
of Lessee's delinquency); or tax (other than net income, estate,
succession, inheritance, transferor franchise taxes), imposed by any
authority having the direct or indirect power to tax, or by any city,
county, state or federal government or any improvement or other district or
division thereof, whether such tax is: (i) determined by the area of the
Demised Premises, the rent or other sums payable hereunder by Lessee or by
other sub-lessees, including, but not limited to, any gross income or
excise tax levied by any of the foregoing authorities with respect to
receipt of such rent or other sums due under this Lease; (ii) imposed upon
any legal or equitable interest of Lessor in the Demised Premises or any
part thereof; (iii) imposed upon this transaction or any document to which
Lessee is a party creating or transferring any interest in the Demised
Premises; (iv) levied or assessed in lieu of, in substitution for, or in
addition to, existing or additional taxes against the Demised Premises
whether or not now customary or within the contemplation of the parties;
(v) imposed as a special assessment for such purposes as fire protection,
street, sidewalk, road, utility construction and maintenance, refuse
removal and for other governmental services; or (vi) imposed as a result of
any transfer of any interest in the Demised Premises by Lessor or the
construction of any improvements thereon or thereto.
SECTION 5.02. PERSONAL PROPERTY TAXES. Lessee shall also pay prior
to delinquency all taxes assessed or levied against Lessee's personal
property in, on or about the Demised Premises or elsewhere. When possible,
Lessee shall cause its personal property to be assessed and billed
separately from the real or personal property of Lessor.
ARTICLE VI
Care of Demised Premises
SECTION 6.01. INJURY TO BUILDINGS. The Lessee shall not perform any
acts or carry on any practices which may injure the buildings and shall
keep the Demised Premises under its control, including the walkways on the
premises and any loading areas, clean and free from refuse at all times,
and shall store all refuse in appropriate containers within the Demised
Premises and arrange for the regular pick-up of such refuse at the Lessee's
expense. The Lessee shall not burn any refuse of any kind in or about the
buildings.
-4-
ARTICLE VII
SECTION 7.01. FACILITIES PROVIDED BY LESSOR. The Lessor shall
provide the Demised Premises on Exhibit A in an "as is" condition at the
commencement of the Lease, which the Lessee agrees to accept.
SECTION 7.02. PAYMENT FOR ELECTRICITY AND ALL UTILITIES BY LESSEE.
Payment for electricity and all utilities used by Lessee used upon or in
connection with the Demised Premises shall be made by the Lessee promptly
when due.
SECTION 7.03. NON-LIABILITY OF LESSOR. The Lessor shall not be
liable in damages or otherwise, should the furnishing of any service by it
to the Demised Premises by interrupted by fire, accident, riot, strike,
acts of God, or the making of necessary repairs or improvements or other
causes beyond the control of the Lessor.
ARTICLE VIII
Maintenance of Building
SECTION 8.01. OBLIGATIONS OF LESSEE. The Lessee shall keep the
entire buildings and parking lots and all parts of the Demised Premises,
including the roof, foundations, structures, parking lots, lights, the
outer and inner walls (including all doors, glass windows and door and
window frames), gutters, down spouts, electrical and refrigeration
equipment roofs, all plumbing, electrical wiring, all improvements,
interiors and all equipment related to the Demised premises in good repair
and condition. The Lessor shall not be obligated to make any improvements
or repairs of any kind upon the Demised Premises, and all other portions of
the Demised Premises shall at all times be kept in good order, operating
condition and repair by the Lessee, and shall also be kept in an clean,
sanitary and safe condition, in accordance with all directions, rules and
regulations of the Health Officers, Fire ▇▇▇▇▇▇▇▇, Building Inspector, or
other proper officers of the governmental agencies having jurisdiction, at
the sole cost and expense of the Lessee.
The Lessee shall permit no injury to the Demised Premises, and the
Lessee shall, at its own cost and expense, replace any windows, doors,
frames and accessory parts thereof, on the Demised Premises which may be
broken or damaged. At the expiration of the Demised Term, the Lessee shall
surrender the premises, and each portion thereof, in as good condition as
the same is on the Commencement Date, reasonable wear and tear and loss by
fire and other unavoidable casualty excepted.
ARTICLE IX
Signs, Alterations and Renovations
SECTION 9.01. The location, size, design, color and other physical
aspects of the Lessee identification sign shall be subject to the Lessor's
-5-
written approval prior to installation, which shall not be unreasonably
withheld, any appropriate municipal or other governmental approvals. The
cost of the sign, its installation, maintenance and removal expense shall
be Lessee's sole expense. If Lessee fails to maintain its sign, or, if
Lessee fails to remove its sign upon termination of this Lease, Lessor may
do so at Lessee's expense and Lessee's reimbursement to Lessor for such
amounts shall be deemed additional rent.
SECTION 9.02. OWNERSHIP OF IMPROVEMENTS. All alterations, additions,
improvements and fixtures, including lighting fixtures, ducts, controls,
filters, or other equipment for distribution of heating or cooling, other
than trade fixtures, which may be made or installed by either of the
parties hereto upon the Demised Premises, and which in any manner are
attached to the floors, walls or ceilings, shall become the property of the
Lessor at the termination of this lease and shall remain upon and be
surrendered with the Demised Premises as a party thereof, without
disturbance, molestation or injury. Any linoleum, carpeting, or floor
covering of similar character, which may be affixed to the floor of the
Demised Premises shall be and become the property of the Lessor absolutely
upon the termination of this lease.
SECTION 9.03. ALTERATIONS. Lessee shall not make or permit any
alterations in, on or about the Demised Premises, except for nonstructural
alterations not exceeding Twenty-Five Thousand ($25,000.00) Dollars in cost
per calendar year, without the prior written consent of the Lessor, and
according to plans and specifications approved in writing by Lessor, which
consent shall not be unreasonably withheld. With regard to alterations not
requiring Lessor's consent, Lessee shall provide Lessor with copies of all
plans and specifications therefor prior to the construction thereof.
Notwithstanding the foregoing, Lessee shall not, without prior written
consent of the Lessor, make any:
(i) Alterations to the structure or exterior of the Building;
(ii) Alterations to and penetrations of the roof of the Buildings and
(iii) Alterations visible from outside the Demised Premises to
which Lessor may withhold Lessor's consent on wholly
aesthetic grounds.
All alterations shall be installed at Lessee's sole expense, in
compliance with all applicable laws and regulations, by a licensed
contractor, shall be done in a good and workmanlike manner conforming in
quality and design with the Demised Premises existing as of the
commencement date hereof, and shall not diminish the value of either the
building or the Demised Premises. All alterations made by Lessee shall be
and become the property of Lessor upon installation and shall not be deemed
Lessee's personal property; provided, however, that Lessor shall at the
time consent for the alterations is requested, notify Lessee whether Lessee
must at the expiration or earlier termination of the Demised Term, remove,
at Lessee's expense, any or all alterations installed by the Lessee and
-6-
return the Demised Premises to their condition prior to the installation of
such alterations, normal wear and tear excepted. Notwithstanding any other
provision of this Lease, Lessee shall be solely responsible for the
maintenance and repair of any and all alterations made by it to the Demised
Premises. Lessee shall give Lessor written notice of Lessee's intention to
perform work on the Demised Premises, whether or not Lessor's consent is
required, at least twenty (20) days prior to the commencement of such work
to enable Lessor to post and record a Notice of Nonresponsibility or other
notice deemed proper before the commencement of any such work, Lessor, at
Lessor's option at the expiration or earlier termination of the Demised
Term, may require Lessee to remove some or all of any alterations installed
without Lessor's consent.
ARTICLE X
Indemnification
SECTION 10.01. LESSEE'S OBLIGATION. Lessee will indemnify Lessor and
save Lessor harmless from and against any and all claims, actions, damages,
liability and expense in connection with death or injury to person(s) or
loss or damage to property occurring in, on or about, or arising out of the
Demised Premises or adjacent areas, the use of occupancy thereof or the
conduct or operation of Lessee's business or occasioned wholly or in part
by any act or omission of Lessee, Lessee's agents, contractors, customers
or employees. All property kept, stored, or maintained in or on the
Demised Premises shall be so kept, stored or maintained at the sole risk of
the Lessee. The Lessee shall not willfully allow the filing of any
mechanic's liens against the Demised Premises.
ARTICLE XI
Insurance
SECTION 11.01. LESSEE SHALL INSURE THE DEMISED PREMISES. Lessee
shall, at its expense, insure the Demised Premises and cause to be paid
insurance premiums at Lessee's expense with suitable insurance companies
and in such amount as is satisfactory to Lessor and shall name Lessor as an
insured to the extent of Lessor's interest. The Lessee shall not carry any
stock or lease to any subtenant, or do anything in or about the Demised
Premises which will in any way tend to increase the insurance rates on the
Demised Premises or the building of which they are a part. The Lessee shall
promptly pay when due, as additional rental, any premiums for insurance
against loss by fire or other casualty which may be charged during the
Demised Term on the amount of insurance to be carried by the Lessor at
Lessor's discretion but not to exceed replacement cost on the Demised
Premises and/or the building of which they are a part, and shall name the
Lessor as a named insured. If the Lessee installs any electrical equipment
which overloads the lines in the Demised Premises, the Lessee shall, at its
own expense, make such changes as are necessary to comply with the
requirements of the insurance underwriters and governmental authorities
having jurisdiction.
-7-
SECTION 11.02. LESSEE'S INSURANCE. Lessee agrees to maintain in
full force and effect at all times during the Demised Term, at its own
expense, for the protection of Lessee and Lessor, as their interests may
appear, policies of insurance issued by a responsible carrier or carriers
acceptable to Lessor which afford the following coverages:
Business interruption insurance in an amount not less than Seven
Million and no/100 ($7,000,000) Dollars, which includes coverage for the
Lessee's rent obligations to Lessor, among other continuing expenses.
Comprehensive general liability insurance in an amount not less than
Three Million and no/100 ($3,000,000) Dollars combined single limit for
both bodily injury and property damage which includes blanket contractual
liability broad form property damage, personal injury, completed operations
and products liability, naming Lessor and its agents as additional
insureds.
"All Risk" property insurance (including, without limitation,
vandalism, malicious mischief, inflation endorsement, and sprinkler leakage
endorsement) on Lessee's personal property located on or in the Demised
Premises. Such insurance shall be in the full amount of the replacement
cost, as the same may from time to time increase as a result of inflations
or otherwise, and shall be in a form providing coverage comparable to the
coverage provided in the standard ISO All-Risk form. As long as this Lease
is in effect, the proceeds of such policy shall be used for the repair and
replacement of such items so insured. Lessor shall have no interest in the
insurance proceeds on Lessee's personal property.
Said insurance shall be in the form and with companies satisfactory to
Lessor and shall provide that such insurance shall not be subject to
cancellations, termination or change except after at least thirty (30) days
prior written notice to Lessor. All policies, or duly executed certificate
or certificates for the same, together with satisfactory evidence of the
payment of the premiums thereof, shall be deposited with Lessor not less
than ten (10) days prior to the date Lessor delivers possession of the
premises to Lessee, upon renewals of such policies not less than thirty
(30) days prior to the expiration of the term of such coverage. If Lessee
fails to comply with such requirements, Lessor may, but shall not be
obligated to, obtain such insurance and keep the same in effect and Lessee
shall pay Lessor the premium cost thereof upon demand. The Lessee shall,
continually during the Demised Term, keep in full force and effect policies
of public liability insurance with respect to the Demised Premises and the
business operated by the Lessee and/or any subtenants of the Lessee in the
Demised Premises, in which both the Lessor and the Lessee shall be named as
parties covered thereby, and in which public liability insurance limits of
liability shall not be less than set forth in this Section.
The Lessee shall furnish the Lessor with a certificate of insurance or
other acceptable evidence that such insurance is in force and the premium
paid. Upon demand, Lessee shall provide Lessor, at Lessee's expense, with
-8-
such increased amount of existing insurance, and such other insurance as
Lessor or Lessor's lender may reasonably require to afford Lessor and
Lessor's lender adequate protection. If, on account of the failure of
Lessee to comply with the foregoing provisions, Lessor is adjudged a co-insurer
by its insurance carrier, then, any loss or damage Lessor shall
sustain by reason thereof, including attorneys' fees and costs, shall be
borne by Lessee and shall be immediately paid by Lessee upon receipt of a
▇▇▇▇ therefor and evidence of such loss.
ARTICLE XII
Assignment and Liens
SECTION 12.01. CONSENT TO ASSIGNMENT. The Lessee agrees not to
assign or transfer this lease or any estate or interest herein, without the
previous written consent of the Lessor, which consent shall not be
unreasonably withheld. Consent by the Lessor to one or more assignments of
this lease, or one or more sublettings of the premises, shall not operate
to extinguish the Lessor's rights under this Article, nor to release Lessee
or any subsequent assignor of liability for performance of the terms of
this lease.
SECTION 12.02 ASSIGNMENT AND SUBLETTING--LESSOR'S CONSENT. Lessee
shall not enter into a subleasing arrangement without Lessor's prior
written consent, which consent shall not be unreasonably withheld. Any
attempted or purported sublet without Lessor's prior written consent shall
be void and confer no rights upon any third person and, at Lessor's
election, shall terminate this Lease. Each subtenant shall agree in
writing, for the benefit of the Lessor, to assume, to be bound by, and to
perform the terms, conditions and covenants of this Lease to be performed
by Lessee. Notwithstanding anything contained herein, Lessee shall not be
released from personal liability for the performance of each term,
condition, and covenant of this Lease by reason of Lessor's consent to a
sublease unless Lessor specifically grants such release in writing.
SECTION 12.03. INFORMATION TO BE FURNISHED. If Lessee desires at any
time to sublet the Demised Premises or any portion thereof, it shall first
notify Lessor of its desire to do so and shall submit in writing to Lessor:
(i) the name and identity of the proposed sub-lessee; (ii) the nature of
the proposed sublessee's business to be carried on in the Demised Premises;
(iii) the terms and provisions of the proposed Sublet form containing a
description of the subject premises; and (iv) such financial information,
including financial statements, as Lessor may reasonably request concerning
the proposed sub-lessee.
SECTION 12.04. EXEMPT SUBLETS. Notwithstanding the above, Lessor's
prior written consent shall not be required for an assignment of this Lease
to a subsidiary, affiliate or parent corporation of Lessee, or a
corporation into which Lessee merges or consolidates, if Lessee gives
Lessor prior written notice of the name of any such assignee, and if the
-9-
assignee assumes, in writing, for the benefit of Lessor all of Lessee's
obligations under the Lease. An assignment or other transfer of this Lease
to a purchaser of all or substantially all of the assets of Lessee shall be
deemed a sublet requiring Lessor's prior written consent.
SECTION 12.05. LIENS. Lessee shall keep the Demised Premises free
from any liens arising out of any work performed, materials furnished or
obligations incurred by or on behalf of Lessee and shall indemnify, defend
and hold Lessor and its agents harmless from all claims, costs and
liabilities, including attorneys' fees and costs, in connection with or
arising out of any such lien or claim of lien. Lessee shall cause any such
lien imposed to be released of record by payment or posing of a proper bond
acceptable to Lessor within ten (10) days after written request by Lessor.
Lessee shall give Lessor written notice of Lessee's intention to perform
work on the Demised Premises which might result in any claim of lien at
least twenty (20) days prior to the commencement of such work to enable
Lessor to post and record a Notice of Non-responsibility. If Lessee fails
to so remove any such lien within the prescribed twenty (20) day period,
then Lessor may do so at Lessee's expense and Lessee shall reimburse Lessor
for such amounts upon demand. Such reimbursement shall include all costs
incurred by Lessor including Lessor's reasonable attorneys' fees with
interest thereon.
ARTICLE XIII
Access to Demised Premises
SECTION 13.01. BY LESSOR. The Lessor shall have the right to enter
upon the Demised Premises at all reasonable hours for the purpose of
exhibiting or inspecting the same or of making repairs, additions or
alterations to the Demised Premises. If the Lessor deems any repairs
required to be made by the Lessee necessary, it may demand that the Lessee
make the same forthwith, and if the Lessee refuses or neglects to commence
such repairs and to complete the same with reasonable dispatch, the Lessor
may make or cause such repairs to be made and shall not be responsible to
the Lessee for any loss or damage that may accrue to its stock or business
by reason thereof; and if the lessor makes or causes such repairs to be
made, the Lessee shall forthwith on demand pay to the Lessor the cost
thereof plus a ten (10%) percent charge for service and overhead, with
interest at ten (10%) percent per annum, and if it shall default in such
payment, the Lessor shall have all remedies provided herein.
ARTICLE XIV
Damage
SECTION 14.01. LESSOR'S OBLIGATION TO REBUILD. If the Demised
Premises are damaged or destroyed by fire or casualty, Lessor shall
promptly and diligently repair the same unless either Lessor or Lessee has
the right to terminate this Lease as provided herein and either party has
elected to so terminate.
-10-
SECTION 14.02. RIGHT TO TERMINATE. Lessor shall have the right to
terminate this Lease in the event of any of the following events occurs:
(i) Insurance proceeds are not available to pay one hundred (100%)
percent of the cost of such repair, excluding the deductible for
which Lessee shall be responsible;
(ii) The Demised Premises cannot, with reasonable diligence, be fully
repaired by Lessor within two hundred seventy (270) days after
the date of the damage or destruction or the insurance proceeds
described in (i) have been made available to Lessor, whichever
occurs later; or
(iii) The Demised Premises cannot be safely repaired because of
the presence of hazardous factors, including, but not
limited to, earthquake faults, radiation, chemical waste and
other similar dangers.
If Lessor elects to terminate this Lease, Lessor shall give Lessee
written notice of its election to terminate within thirty (30) days after
such damage or destruction or Landlord's receipt of information that the
insurance proceeds described in (i) are inadequate, and this Lease shall
terminate fifteen (15) days after the date Lessee receives such notice. If
Lessor elects not to terminate the Lease, subject to Lessee's termination
right set forth below, Lessor shall promptly commence the process of
obtaining necessary permits and approvals and repair of the Demised
Premises as soon as practicable, and this Lease will continue in full force
and effect. All insurance proceeds from insurance as provided hereunder,
excluding proceeds for Lessee's personal property, shall be disbursed and
paid to Lessor. Lessee shall be required to pay to Lessor the amount of
any deductibles payable in connection with any insured casualties, Lessee
shall have the right to terminate this lease, if the Demised Premises
cannot, with reasonable diligence and subject to Lessee delays, be fully
repaired within one hundred eighty (180) days from the date of damage or
destruction or the date that the insurance proceeds described in (i) became
available to Lessor, whichever occurs later. The determination of the
estimated repair period shall be made by Lessor in its good faith business
judgment within thirty (30) days after such damage or destruction. Lessor
shall deliver written notice of the repair period to Lessee after such
determination has been made and after the insurance proceeds have become
available to Lessor and Lessee shall exercise its right to terminate this
Lease, if at all, within ten (10) days of receipt of such notice from
Lessor.
SECTION 14.03. LIMITED OBLIGATION TO REPAIR. Lessor's obligation,
should it elect or be obligated to repair or rebuild, shall be limited to
the Demised Premises, and the Lessee improvements, as the case may be, as
any or all of the same existed immediately prior the casualty, excluding,
however, any additional alterations or improvements made by Lessee.
-11-
SECTION 14.04. NON-ABATEMENT OF RENT. Rent shall not ▇▇▇▇▇ during
any period when, by reason of such damage or destruction, Lessee's
enjoyment of the Demised Premises has been interfered with or interrupted.
Lessee shall, however, not be in default of its obligations to timely pay
rent under Section 15.01 if Lessee tenders the rental obligations covered
by Lessee's business interruption insurance coverage by the first (1st) day
of the month following receipt of those monies by the Lessee.
SECTION 14.05. DAMAGE NEAR END OF DEMISED TERM. Anything herein to
the contrary notwithstanding, if the Demised Premises are destroyed or
damaged during the last twelve (12) months of the Demised Term, then Lessor
or Lessee may, at their respective option, cancel and terminate this Lease
as of the date of the occurrence of such damage. If neither Lessor nor
Lessee elects to so terminate this Lease, the repair of such damage shall
be governed by Article XIV herein.
ARTICLE XV
Default and Remedies of the Lessor
SECTION 15.01. LESSEE'S DEFAULT. A default under this Lease by
Lessee shall exist if any of the following occurs:
(i) If Lessee fails to pay Monthly Rent or any other sum required to
be paid hereunder when due;
(ii) If Lessee fails to perform any term, covenant or condition of
this Lease, except those requiring the payment of money, and
Lessee fails to cure such breach within fifteen (15) days after
written notice from Lessor where such breach could be reasonably
cured within such fifteen (15) day period; provided, however,
that where such failure could not reasonably be cured within the
fifteen (15) days period, that Lessee shall not be in default if
it commences such cure within the fifteen (15) day period and
thereafter diligently prosecutes same to completion, which
completion shall occur not later than sixty (60) days from the
date of receipt of written notice of Lessors;
(iii) If Lessee assigns its assets for the benefit of its
creditors;
(iv) If the sequestration or attachment of or execution on any
material part of Lessee's personal property essential to the
conduct of Lessee's business occurs, and Lessee fails to obtain a
return or release of such personal property within thirty (30)
days thereafter, or prior to sale pursuant to such sequestration,
attachment or levy, whichever is earlier;
(v) If Lessee fails to continuously or uninterruptedly conduct its
business in the Demised Premises, or shall have abandoned or
vacated the Demised Premises; or
-12-
(vi) If a court makes or enters any decree or order other than under
the bankruptcy laws of the United States adjudging Lessee to be
insolvent; or approving as properly filed a petition seeking
reorganization of Lessee; or directing the winding up or
liquidation of Lessee and such decree or order shall have
continued for a period of thirty (30) days.
SECTION 15.02. REMEDIES. Upon a default, Lessor shall have the
following remedies, in addition to all other rights and remedies provided
by law or otherwise provided in this Lease, to which Lessor may resort
cumulatively or in the alternative:
(i) Lessor may continue this Lease in full force and effect, and this
Lease shall continue in full force and effect as long as Lessor
does not terminate this Lease, and Lessor shall have the right to
collect Monthly Rent when due.
(ii) Lessor may terminate Lessee's right to possession of the Demised
Premises at any time by giving written notice to that effect, and
relet the Demised Premises or any part thereof.
Lessee shall be liable immediately to Lessor for all costs Lessor
incurs in reletting the Demised Premises or any part thereof, including
without limitation, broker's commissions, expenses of cleaning and
redecorating the Demised Premises required by the reletting and like costs.
Reletting may be for a period shorter or longer than the remaining term of
this Lease. No act by Lessor other than giving written notice to Lessee
shall terminate this Lease. Acts of maintenance, efforts to relet the
Demised Premises or the appointment of a receiver on Lessor's initiative to
protect Lessor's interest under this Lease shall not constitute a
termination of Lessee's right to possession. On termination, Lessor has
the right to remove all Lessee's personal property and store same at
Lessee's cost and to recover from Lessee as damages:
(a) The worth at the time of aware of unpaid Rent and other sums
due and payable which had been earned at the time of termination plus
(b) The worth at the time of award of the amount by which the
unpaid Monthly Rent for the balance of the Lease, and other sums due
and payable which would have been payable after termination until the
time of award exceeds the amount of such Monthly Rent loss that Lessee
proves could have been reasonably avoided: plus
(c) The worth at the time of award of the amount by which the
unpaid Monthly Rent and other sums due and payable for the balance of
the Demised Term after the time of award exceeds the amount of such
Monthly Rent loss that Lessee proves could be reasonably avoided plus
(d) Any other amount necessary which is to compensate Lessor for
-13-
all the detriment proximately caused by Lessee's failure to perform
Lessee's obligations under this Lease, or which, in the ordinary
course of things, would be likely to result therefrom, including,
without limitation, any costs or expenses incurred by Lessor
(1) in retaking possession of the Demised Premises:
(2) in maintaining, repairing preserving, restoring,
replacing, cleaning, altering or rehabilitating the
Demised Premises or any portion thereof, including such
acts for reletting to a new lessee or lessees:
(3) for leasing commissions or
(4) for any other costs necessary or appropriate to relet
the Demised Premises plus
(e) At Lessor's election, such other amounts in addition to or
in lieu of the foregoing as may be permitted from time to time by the
laws of the State of Michigan.
The "worth at the time of award" of the amounts referred to in
Paragraphs (a) and (b) above is computed by allowing interest at the
interest rate on the unpaid rent and other sums due and payable from the
termination date through the date of award. The "worth at time of award"
of the amount referred to in Paragraph (c) above is computed by discounting
such amount at the discount rate of the Federal Reserve Bank of Detroit at
the time of award plus one percent (1%). Lessee waives redemption or
relief from forfeiture hereunder in accordance with Michigan law, in the
event Lessee is evicted or Lessor takes possession of the Demised Premises
by reason of any default of Lessee hereunder.
(iii) Lessor may, with or without terminating this Lease, re-enter the
Demised Premises and remove all persons and property from the Demised
Premises: such property may be removed and stored in a public warehouse or
elsewhere at the cost of and for the account of Lessee. No re-entry or
taking possession of the Demised Premises of Lessor pursuant to this
paragraph shall be construed as an election to terminate this Lease unless
a written notice of such intention is given to Lessee.
SECTION 15.03. LESSOR'S DEFAULT. Lessor shall not be deemed to be in
default in the performance of any obligation required to be performed by it
hereunder unless and until it has failed to perform such obligation within
thirty (30) days after receipt of written notice from Lessee to Lessor
specifying the nature of such defaults provided, however, that if the
nature of the Lessor's obligation is such that more than thirty (30) days
are required for its performance, then Lessor shall not be deemed to be in
default if it shall commence such performance within such thirty (30) day
period and thereafter diligently prosecute the same to completion.
-14-
ARTICLE XVI
Eminent Domain
SECTION 16.01. TOTAL CONDEMNATION. If the whole of the Demised
Premises shall be acquired or condemned by eminent domain for any public or
quasi-public purpose, then the term of this lease shall cease and terminate
as of the date of title vesting in such proceeding and all rentals shall be
paid up to that date and the Lessee shall have no claim against Lessor for
the value of any unexpired term of this lease.
SECTION 16.02. PARTIAL COMPENSATION. If any part if the Demised
Premises shall be acquired or condemned by eminent domain for any public or
quasi-public purpose, and in the event that such partial taking or
condemnation shall render the balance of the Demised Premises unsuitable
for the business of the Lessee, then the term of this lease shall cease and
terminate as of the date of title vesting in such proceeding and Lessee
shall have no claim against Lessor for the value of any unexpired term of
this lease. In the event of a partial taking of condemnation which is not
extensive enough to render the premises unsuitable for the business of the
Lessee, then Lessor shall promptly restore the Demised Premises to a
condition comparable to its condition at the time of such condemnation less
the portion lost in the taking, and this lease shall continue in full force
and effect.
ARTICLE XVII
Subordination
SECTION 17.01. SUBORDINATION. This Lease is subject and subordinate
to any mortgages (collectively "Encumbrances") which may now affect the
Demised Premises and to all renewals, modifications, consolidations,
replacements and extensions thereof provided, however, if the holder or
holders of any such Encumbrance ("Holder") shall require that this Lease be
prior and superior thereto, Lessee shall, within seven (7) days after
written request from Lessor, execute, have acknowledged and deliver any and
all reasonable documents or instruments, which Lessor or Holder deems
necessary or desirable for such purposes, Lessor shall have the right to
cause this Lease to be and become and remain subject and subordinate to any
and all Encumbrances which are now or may hereafter be executed covering
the Demised Premises or any renewals, modifications, consolidations,
replacements or extensions thereof, for the full amount of all advances
made or to be made thereunder and without full regard to the time or
character of such advances, together with interest thereon and subject to
all the terms and provisions thereof provided only, that in the event of
termination of any such lease or upon the foreclosure of any such mortgage
or deed of trust, so long as Lessee is not in default, Holder agrees to
recognize Lessee's rights under this Lease as long as Lessee shall pay the
Monthly Rent and observe and perform all the provisions of this Lease to be
observed and performed by Lessee. Lessor shall obtain a nondisturbance
agreement from the Holder of any Encumbrance which provides for such
-15-
recognition of Lessee's rights under this Lease. Within ten (103 days
after Lessor's written request, Lessee shall execute any and all documents
required by Lessor or the Holder required to make this Lease subordinate to
any lien of the Encumbrance. If Lessee fails to do so, it shall be deemed
that this Lease is subordinated. Notwithstanding anything to the contrary
set forth in this paragraph, Lessee hereby attorns and agrees to attorn to
any entity purchasing or otherwise acquiring the Demised Premises at any
sale or other proceeding or pursuant to the exercise of any other rights,
powers or remedies under such Encumbrance.
ARTICLE XVIII
Notices
SECTION 18.01. MANNER OF GIVING. All notices to be given hereunder
shall be deemed to be properly given if, in the case of notices by the
Lessor to the Lessee, they are addressed to Lessee at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or such other address as the Lessee may from time to
time furnish to the Lessor in writing for such purpose: and, in the case of
notices by the Lessee to the Lessor, if they are addressed to Lessor at
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or such other address as the Lessor
may from time to time furnish to the Lessee in writing for such purpose.
All notices shall be in writing and shall be mailed by certified or
registered mail, with return receipt requested, in an envelope addressed as
above described, no later than the date upon which notice is required to be
given pursuant to the terms of this lease. All such notice shall be
deemed given when so certified or registered and deposited in the United
States' mail, postage prepaid.
ARTICLE XIX
Construction
SECTION 19.01. RELATIONSHIP OF PARTIES AND CONSTRUCTION OF AMENDMENT.
Nothing contained herein shall be deemed or construed by the parties
hereto, nor by any third party, as creating the relationship of principal
and agent, or of being agreed that neither any provision named herein, nor
any acts of the parties herein, shall be deemed to create any relationship
between' the parties hereto other than the relationship of landlord and
tenant. Whenever herein the singular number is used, the same shall
include the plural, and the masculine gender shall include the feminine and
neuter genders. This Agreement shall be construed without reference to
titles of Articles and Sections, which are inserted for convenience of
reference only.
ARTICLE XX
Consent Not Unreasonably Withheld: Non-Waiver
SECTION 20.01. LESSOR'S CONSENT. The Lessor agrees that whenever
under this Agreement provision is made for the Lessee securing the written
consent of the Lessor, such written consent shall not be unreasonably
-16-
withheld Section 20.02. No Implied Waiver. No Waiver of condition or
covenant of this lease by either party hereto shall be deemed to imply or
constitute a further waiver by such party of the same or any other
condition or covenant.
ARTICLE XXI
Miscellaneous Terms and Provisions
SECTION 21.01. SUPERSEDES ALL PRIOR AGREEMENTS. This Agreement
supersedes and replaces all prior agreements between the parties hereto
pertaining to the subject matter herein.
SECTION 21.02. GOVERNING LAW. This Agreement shall be subject to and
governed by the laws of the State of Michigan.
SECTION 21.03. INVALID PROVISIONS. The invalidity or unenforceability
of any particular provision of this Agreement shall not affect the other
provisions hereof, and this Agreement shall be construed in all respects as
if such invalid or unenforceable provision were omitted.
SECTION 21.04. BINDING EFFECT. This Agreement shall be binding upon
the parties hereto, their respective heirs, legal representatives,
executors, administrators, successors and assigns. Any right given or duty
imposed upon the estate of the deceased party shall inure to the benefit of
and be binding upon the fiduciary of such decedent's estate, his or its
fiduciary capacity
SECTION 21.05. RIGHT OF FIRST REFUSAL. The Lessor hereby agrees to
give to the Lessee a right of first refusal with respect to the sale of the
Demised Premises in accordance with the further terms and conditions
contained herein. This covenant shall require that in the event the Lessor
desires to sell the Demised Premises, then the Lessor shall first offer
such property for sale to the Lessee stating the terms and conditions and
allowing the Lessee fifteen (15) days in which to elect to purchase the
said property in accordance with said terms and conditions or to decline.
If the Lessee fails to accept or reject the offer within the fifteen (15)
day' period, it shall be to be rejected. The offer may be accepted if the
Lessee delivers in writing to the Lessor the Lessee's intent to accept the
offer and delivers a deposit equal to Twenty-Five (25%) percent of the
purchase price.
SECTION 21.06. ATTORNEYS' FEES. If either party brings any action or
legal proceeding for damages for an alleged breach of any provision of this
Lease, to recover rent, or other sums due, to terminate the tenancy of the
Demised Premises or to enforce, protect or establish any term, condition or
covenant of this Lease or right of either party, the prevailing party shall
be entitled to recover as a part of such action or proceedings, or in a
separate action brought for that purpose, reasonable attorneys' fees and
costs.
-17-
SECTION 21.07. LATE PAYMENT CHARGES. Lessee acknowledges that late
payment by Lessee to Lessor of Rent and other charges provided for under
this Lease will cause Lessor to incur costs not contemplated by this Lease,
the exact amount of such costs being extremely difficult or impracticable
to fix. Therefore, if any installment of Rent or any other charge due from
Lessee is not received by Lessor when due, Lessee shall pay to Lessor an
additional sum equal to ten (10%) percent of the amount overdue as a late
charge for every month or portion thereof that the Rent or other charges
remain unpaid. The parties agree that this late charge represents a fair
and reasonable estimate of the costs that Lessor will incur by reason of
the late payment by Lessee.
SECTION 21.09. ESTOPPEL CERTIFICATES. Lessee shall within ten (10)
days following written request by Lessor:
(i) Execute and deliver to Lessor any documents, including estoppel
certificates, in the form prepared by Lessor (a) certifying that
this Lease is unmodified and in full force and effect, or if
modified, stating the nature of such modification and certifying
that this Lease, as so modified, is in full force and effect, and
the date to which the Monthly Rent and other charges are paid in
advance, if any, and (b) acknowledging that there are not, to
Lessee's knowledge, any uncured defaults on the part of Lessor,
or, if there are uncured defaults on the part of Lessor, stating
the nature of such uncured defaults and (c) evidencing the status
of the Lease as may be required either by a lender making a loan
to Lessor to be secured by deed of trust or mortgage covering the
Demised Premises or a purchaser of the Demised Premises from
Lessors Lessee's failure to deliver an estoppel certificate
within ten (10) days after delivery of Lessor's written request
therefor shall be conclusive upon Lessee (a) that this Lease is
in full force and effect, without modification except as may be
represented by Lessor, (b) that there are now no uncured defaults
in Lessor's performance and (c) that no Monthly Rent has been
paid in advance. If Lessee fails to so deliver a requested
estoppel certificate within the prescribed time, it shall be
conclusively presumed that the Lease is unmodified and in full
force and effect except as represented by Lessor.
(ii) Deliver to Lessor the current financial statements of Lessee, and
financial statements of the two (2) years prior to the current
financial statements year, with an opinion of a certified public
accountant, including a balance sheet and profit and loss
statement for the most recent prior year, all prepared in
accordance with generally accepted accounting principles
consistently applied.
-18-
IN WITNESS WHEREOF, the parties have hereunto set their hands and
seals the day and year first above written.
In the Presence of: LESSOR:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇, Inc.
_____________________________ ___________________________________
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
_____________________________
LESSEE:
The Colonel's, Inc.
_____________________________ By: _______________________________
_____________________________ Its __________________________
-19-