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Exhibit 10.5
FIRST AMENDMENT
DATED APRIL 5, 2007
TO
LEASE AGREEMENT
by and between
HELLWEG GMBH & CO. VERMOGENSVERWALTUNGS KG,
a German limited partnership
registered with the commercial register
maintained at the local court of Dortmund under HRA 13391,
as LANDLORD
and
HELLWEG DIE PROFI-BAUMARKTE GMBH UND CO. KG,
a German limited partnership
registered with the commercial register
maintained at the local court of Dortmund under HRA 13582,
as TENANT
Premises:
1. Aschersleben,
Germany
2. Berlin-Biesdorf, Germany
3.
Berlin-WeiBensee, Germany
4. Blumberg,
Germany
5.
Bochum-Hofstede, Germany
6. Bonn-Beuel,
Germany
7.
Bonn-Duisdorf, Germany
8. Chemnitz II,
Germany
9.
Dahlwitz-Hoppegarten, Germany
10.
Dortmund-Kley, Germany
11. Ennepetal,
Germany
12.
Essen-Altenessen, Germany
13.
Essen-Borbeck, Germany
14.
Essen-Kettwig, Germany
15. Falkensee,
Germany
16.
Gelsenkirchen, Germany
17. Geltow,
Germany
18. Greiz,
Germany
19. Gronau,
Germany
20. Guben,
Germany
21. Halberstadt,
Germany
22. Halle,
Germany
23. Hennigsdorf,
Germany
24. Leipzig,
Germany
25. Ludenscheid,
Germany
26.
Lutherstadt-Eisleben, Germany
27. Magdeburg
Mittagstr., Germany
28.
Magdeburg,
Germany
29. Menden,
Germany
30. Mettmann,
Germany
31. Nordhausen,
Germany
32. Paderborn,
Germany
33. Potsdam,
Germany
34. Quedlinburg,
Germany
35.
Steinfurt,
Germany
36. Werl,
Germany
37. Zwickau,
Germany
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THIS FIRST AMENDMENT TO LEASE AGREEMENT ("First Amendment to
Lease"), made as of
the 5th day of April, 2007, between HELLWEG GMBH & CO.
VERMOGENSVERWALTUNGS KG,
a German limited partnership registered with the commercial
register maintained
at the local court of Dortmund under HRA 13391 ("Landlord"), and
HELLWEG DIE
PROFI-BAUMARKTE GMBH UND CO. KG, a German limited partnership
registered with
the commercial register maintained at the local court of Dortmund
under HRA
13582 ("Tenant"), both with an address at Borussiastrasse 112,
44149 Dortmund,
Germany.
BACKGROUND
A.
Landlord and
Tenant have entered into that certain Lease Agreement
dated February 28, 2007.
B.
Landlord and
Tenant have agreed to amend said Lease Agreement as
herein set forth.
1. Demise of
Premises. is hereby amended by deleting the phrase "known as
Berlin-Weissensee, Roelckestr. 108 and listed as Number 26" and
using in
lieu
thereof "known as Berlin-Weissensee, Roelckestr. 108 and listed
as
Number 3."
2. Paragraph 2
Definitions is hereby amended by deleting the definitions of
"Assignment", "Interest Purchase Agreement", "Lease", "Lender",
"Mortgage",
"Note", "Security Deposit", "Shareholder" and "VAT" in their
entirety and
inserting the following in lieu thereof:
"Assignment" shall mean any assignment of rents and leases from
Landlord to a Lender which (a) encumbers any of the Leased
Premises
and (b) secures the obligation of Landlord or a Shareholder in
Landlord to repay a Loan, as the same may be amended, supplemented
or
modified from time to time.
"Interest and Share Purchase Agreement" shall mean that certain
Interest Purchase Agreement dated February 28, 2007, among HLWG
TWO
(GER) LLC, Mr. Reinhold Semer and Semer Unternehmensverwaltung GmbH
&
Co. KG.
"Lease" shall mean the Lease Agreement dated February 28, 2007,
as
amended by the First Amendment to Lease Agreement dated April 5,
2007.
"Lender" shall mean any Person (and its respective successors
and
assigns) which may, after the date hereof, make a Loan.
"Loan" shall mean any loan made by one or more Lenders to Landlord
or
to a Shareholder in Landlord or be the holder of a Note or
beneficiary
of a Mortgage.
"Mortgage" shall mean any mortgage or land charges (i) in favor of
a
Lender which (a) encumbers any of the Leased Premises and (b)
secures
any obligation of a Shareholder in Landlord to repay a Loan, as
the
same may be amended, supplemented or modified or (ii) from Landlord
to
a Lender which (x) encumbers any of the
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Leased Premise and (y) secures Landlord's obligations to repay a
Loan,
as the same may be amended, supplemented or modified.
"Note" shall mean any promissory note evidencing Landlord's or
a
Shareholder's obligation to repay a Loan, as the same may be
amended,
supplemented or modified.
"Security Deposit" shall mean the Initial Security Deposit, the
Covenant Security Deposit, the Holdback Security Deposit and/or
the
Cash Security Deposit, as the context may require.
"Shareholder" shall mean any Person which shall directly or
indirectly
own or control five percent (5%) or more of (i) the convertible
debt
or (ii) the outstanding Voting Stock of a corporation or other
controlling interest if such Person is not a corporation and
which,
for the purposes of being the borrower under a Loan, shall
include
HLWG TWO (GER) LLC."
3. Paragraph 2.
Definitions is hereby amended by adding thereto the following
definition:
"Holdback Security Deposit" shall mean "Holdback Security Deposit"
as
defined in Paragraph 32(ii).
4. Clause (f) of
Paragraph 3. Title and Condition; Single Lease Transactions
is
hereby amended by deleting the phase "PARAGRAPH 18 or 37(o)"
and
inserting in lieu thereof "PARAGRAPH 18 or PARAGRAPH 38(o)."
5. Paragraph 6,
Basic Rent is hereby amended by deleted the words "shall
include VAT on such payment and".
6. Subparagraph
(a) of Paragraph 12. Maintenance and Repair is hereby amended
by
deleting the words commencing "in as good repair" and ending "other
real
properties owned or operated by it and in" and shall be replaced
with the
following words:
"in good repair and condition. The appearance shall be fit to be
used
for their intended use provided that the items used in any repair
or
reinstatement should be of similar quality and nature than is
currently used and need not be of any higher quality. In.."
Furthermore, the following additional sentence shall be added at
the bottom
of
the paragraph 12(a):
"For avoidance of doubt, Tenant shall have the sole obligation
to
maintain the Leased Premises, including the foundation and
structure,
in at least as good and full repair and condition as on the
date
hereof."
7. Paragraph
9(b) shall be amended by adding the words "and Tenant shall
promptly provide (and no later than within ten (10) days of paying
such
VAT)
such written evidence of such payments together with copies of
such
VAT
returns to the Landlord and the Lender" after the words "shall
be
performed by Tenant".
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8. Clauses (i),
(ii) and (iv) of subparagraph (a) and subparagraph (b) of
Paragraph 16. Insurance are hereby deleted in their entirety and
the
following is hereby inserted in lieu thereof:
"(i) Insurance against (A) fire, lightning, explosion, falling
aircraft, storm/hail, power surge, damage to property following
burglary or attempt thereof, flood (due to heavy rain falls, snow
or
from running or still water, such as rivers, lakes creeks),
named
natural hazards such as subsidence, earthquake, snow load,
avalanche
and volcanic eruptions, extended perils, such as strike,
malicious
damage, riots, vehicle impact, smoke and sonic blast, debris
removal,
demolition, clearance and fire fighting costs and professional fees
on
a full replacement basis and indexed annually, (B) terrorism in
an
amount of up to and including but not more than fifty percent
of
replacement value of the Leased Premises, and (C) loss of rent
insurance for a period of not less than thirty-six (36) months
from
time of loss. Such policies and endorsements shall contain
deductibles
of not more than Twenty-Five Thousand Euros (E25,000.00) per
occurrence. Further, the insurance against flood, subsidence,
earthquake, snow load, avalanche and volcanic eruptions shall be in
an
amount not less than Fifteen Million Euros (E15,000,000).
"(ii) Commercial General Liability Insurance
(Betriebshaftpflicht)
against claims for personal and bodily injury, death or
property
damage occurring on, in or as a result of the use of the Leased
Premises, in an amount not less than Ten Million Euros
(E10,000,000) for injury or damage to persons and private risk,
Two Million Five Hundred Thousand Euros (E2,500,000.00) for
injury or damage to the environment and Fifty Thousand Euros
(E50,000.00) for personal property."
"(iv) During any period in which substantial Alterations at the
Leased
Premises are being undertaken or an Expansion is being
constructed,
builder's risk insurance (Bauwesenversicherung) covering the
total
completed value, including all hard and soft costs (which shall
include business interruption coverage) with respect to the
Improvements being constructed, altered or repaired (on a
completed
value, non-reporting basis), replacement cost of work performed
and
equipment, supplies and materials furnished in connection with
such
construction, alteration or repair of Improvements or Fixtures,
together with such other endorsements as Landlord or Lender may
reasonably require, and general liability, worker's compensation
and
automobile liability insurance with respect to the Improvements
being
constructed, altered or repaired.
"(b) The insurance required by Paragraph 16(a) shall be written
by
companies having an international reputation and of size and
placed
with insurers that have a long term unsecured unsubordinated
and
unguaranteed debt instrument rating of A or better by Fitch, A2
or
better by Moody's and A or better by Standard & Poor's or
otherwise as
reasonably acceptable to Lender and Landlord and in any case which
are
authorized to write
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insurance policies according to German law. The insurance
policies
shall be for such terms customarily provided to similar properties
by
German insurance companies. If said insurance or any part
thereof
shall expire, be withdrawn, become void, voidable, unreliable
or
unsafe for any reason, including a breach of any condition thereof
by
Tenant or
the failure or impairment of the capital of any insurer, or
if for any other reason whatsoever said insurance shall become
reasonably unsatisfactory to Landlord, Tenant shall immediately
obtain
new or additional insurance reasonably satisfactory to
Landlord."
9. Clause (iii)
of subparagraph (a) of Paragraph 16. Insurance is hereby
deleted in its entirety.
10. Subparagraph (c)
and subparagraph (d) of Paragraph 13 Alterations,
Improvements and Expansions are hereby deleted in its entirety and
the
following is hereby inserted in lieu thereof:
"(c) Tenant shall complete the expansions described in Exhibit
"I"
hereto (the "Required Expansions") which Tenant shall construct
in
accordance with the requirements of this Paragraph 13. Landlord
hereby
consents to the construction of the Required Expansions;
provided,
however, that if additional land (any such land, "Additional
Property") is required for the construction of any Required
Expansion,
Landlord's consent shall not be effective unless and until
Landlord
and Lender shall have reviewed due diligence materials for the
Additional Property as either Person shall request and which shall
be
satisfactory to Landlord and Lender in all respects, and title to
the
Additional Property shall have been negotiated in the name of
Landlord
in the applicable jurisdiction. Upon completion of each
Expansion
Premises that is the subject of the Required Expansions, which
completion shall be evidenced by (i) the issuance of a written
confirmation of the architect supervising the construction that
the
Required Expansions are completed and the operations have
commenced
(Fertigstellung und Inbetriebnahme), and (ii) either (A)
certificates
of occupancy issued by the applicable local governmental authority,
or
(B)to the extent certificates of occupancy have not been
issued,
negative confirmations confirming that certificates of occupancy
are
not required with respect to the applicable Required Expansion, or
(C)
a statement from the local municipal authority stating that a
building
permit exists, there are no material defects with respect to
the
applicable Required Expansion, and the applicable local
municipality
has no objection to the use of the relevant Expansion Premises,
Landlord shall, within ten (10) days following the delivery of
such
evidence and so long as no Event of Default exists, release to
Tenant
the applicable portion of the Expansion Holdback for the
applicable
completed Required Expansion.
(d) In case Tenant does not complete one or more of the
Required
Expansions within thirty six (36) months of the date of this
Lease,
due to any cause or causes which Tenant is not, despite its
best
efforts, able to prevent or overcome (which causes exclude the
unavailability of money, unavailability of sources of
financing,
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a shortage of labor or materials, or changes in market
conditions),
the total amount of Basic Rent shall remain unaffected except
as
expressly provided in (ii) in the succeeding sentence. In such
event,
Landlord shall have the right, at its sole and exclusive option,
to
either (i) pay the respective portion of the Expansion
Holdback,
including interest accrued thereon, to Tenant or (ii) (A) retain
on
Landlord's behalf the respective portion of the Expansion
Holdback,
excluding interest accrued thereon, without any further
obligations
hereunder to remit such portion of the Expansion Holdb
