LEASE
AGREEMENT
THIS LEASE AGREEMENT (the “Lease
Agreement”), made this day 28 th day of December
, 2006 (“Effective Date”), by and
between PHILLIP A. WILAND and LINDA S. WILAND, both individuals who
reside in the State of Colorado (collectively, the
“Landlord”) and SIMCLAR INTERCONNECT TECHNOLOGIES,
INC., a Delaware corporation (“Simclar”).
WITNESSETH
WHEREAS, Landlord is the owner of Lots 1 and 4
of Wiland Park Subdivision (the “Wiland Park
Subdivision” and each lot individually referred to as
“Lot 1” and “Lot 4”), a subdivision in
Ozark, Christian County, Missouri, the final plat of which is
recorded in Book H, at Page 524 in the Office of the Recorder,
Christian County, Missouri, a copy of which is attached hereto as
Exhibit A and incorporated herein by this reference;
WHEREAS, located on Lot 1 is a building
containing approximately 171,238 square feet (the
“Building”), together with certain improvements,
including, but not limited to, an entrance and drive off of Highway
14, a loading and unloading dock and various areas of
parking;
WHEREAS, Lot 4 contains no buildings but is
paved for use as a parking area;
WHEREAS, prior to the execution of this Lease
Agreement, the Building was under lease to Astral Direct, LLC, a
Delaware limited liability company
(“Astral”);
WHEREAS, Astral has agreed to terminate its
lease of the Building in order to enter into a new lease for a
portion of the Building and to allow Simclar to lease the remaining
portion of the Building;
WHEREAS, Landlord desires to lease to Simclar
and Simclar desires to lease from Landlord (1) approximately 52,826
square feet of space in the Building (30.85% of the total square
footage of the Building) as set forth and described in Exhibit B,
which is attached hereto and incorporated herein by this reference,
(2) with the exception of any areas specifically reserved for use
by Astral, including, but not limited to the portion of the
Building leased to Astral and the parking areas reserved to them as
set forth in Exhibit E, attached hereto (the “Astral
Lease”), the interior and exterior common and public areas
and facilities on Lot 1 (as further defined in Section 1 below) and
(3) all of Lot 4 (the “Simclar Premises”);
WHEREAS, Simclar acknowledges that the remaining
portion of the Building (that portion not being leased by Simclar
as provided for herein) and certain parking areas are being leased
to Astral pursuant to the Astral Lease executed simultaneously with
this Lease Agreement; and
WHEREAS, the parties agree that this Lease
Agreement is contingent upon and is to be executed simultaneously
with the Astral Lease; and
WHEREAS, Landlord desires to grant Simclar an
option to purchase and a right of first refusal with respect to
Lots 1, 2, 3 and 4 of Wiland Park Subdivision upon the terms and
conditions granted herein;
NOW THEREFORE, in consideration of the mutual
covenants and agreements between the parties hereto and other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged by both parties, Landlord and Simclar agree
as follows:
1. Premises . Landlord hereby leases to
Simclar and Simclar agrees to lease from Landlord, upon and subject
to the terms and provisions of this Lease Agreement, the Simclar
Premises, subject to the following:
(a)
The drive, as currently
constructed, which provides access to the Building from and to
State Highway 14 shall only be used for the purpose of ingress and
egress and is not to be used for parking;
(b)
The loading dock area and the truck
turnaround area on the east side of the Building on Lot 1 are
reserved for use by Astral, except that Simclar will generally have
the right of passage through this area for ingress and egress to
the other Lots and to the other entrances to the building and other
parking areas;
(c)
Ten (10) of the parking spaces
located on the north side of the Building on Lot 1 shall be
reserved and designated for parking by Simclar. More specifically,
five (5) of the parking spaces which face the Building and five (5)
of the parking spaces which face State Highway 14 shall be reserved
and designated for parking by Simclar. All remaining parking spaces
on the north side of the Building on Lot 1 shall be reserved for
use by Astral. Simclar and Astral shall mutually agree as to the
exact location of the ten (10) parking spaces subject to the
above.
(d)
All the parking on the south side
of the Building on Lot 1 will be shared equally by Simclar and
Astral on a daily first-come, first-served basis.
(e)
The lease of Lot 4 is strictly for
use as parking and no improvements may be constructed
thereon;
Simclar acknowledges that Lot 2 and Lot 3, which
are also owned by Landlord and are a part of Wiland Park
Subdivision, are not a part of the Simclar Premises or this Lease
Agreement (except as they relate to the Option, as defined in
Section 30 below) and Simclar has no right to use any portion of
said Lots.
2. Term .
Simclar takes and accepts this Lease Agreement commencing on the
Effective Date and expiring on December 31, 2011, unless sooner
terminated or extended as provided in this Lease Agreement or
otherwise agreed to in writing by the parties (“Lease
Term”). Assuming Simclar is not otherwise in default under
the Lease Agreement, Simclar may, at its sole option, renew the
Lease Agreement for a five year term beginning January 1, 2012 and
expiring December 31, 2016, by giving notice to Landlord on or
before June 30, 2011. In the event of renewal, rent shall be
increased based upon the change in the Consumer Price Index
(“CPI”) during the period October 1, 2006 through
September 30, 2011.
For purposes
hereof, the term “CPI” shall mean the Consumer Price
Index-All Urban Consumers, U.S. All Items (1982-84= 100) as
published by the United States Department of Labor, Bureau of Labor
Statistics. In the event that the United States Department of
Labor, Bureau of Labor Statistics discontinues the publication of
the present CPI, the index to be used hereunder shall be such index
as may be published by any other United States government bureau or
department to replace the present CPI. The percentage increase in
CPI shall be determined by (a) taking the September CPI reported
for the calendar year prior to the calendar year for which the
increase is effective and subtracting the September CPI reported
one year earlier (the “Prior Period CPI”) and (b)
dividing the result by the Prior Period CPI.
3.
Rent . Simclar covenants and agrees to pay Landlord
without demand or offset (unless specifically provided herein), at
Landlord's office located at 8000 North 41st Street, Longmont,
Colorado 80503 or at such place as Landlord may from time to time
designate in writing, minimum rent (“Rent”) as
follows:
(a)
From the Effective Date through
January 31, 2007, including any partial months, rent shall be fully
abated, with no payment of rent by Simclar; and
(b)
From February 1, 2007, through
December 31, 2011, including any partial months, at the rate of One
Hundred Eighteen Thousand Eight Hundred Fifty Eight and 50/100
Dollars ($118,858.50) per annum, payable in equal monthly
installments of Nine Thousand Nine Hundred Four and 88/100 Dollars
($9,904.88); and
(c)
From January 1, 2012, through
December 31, 2016, at the rates specified in Section 2 hereof, if
Simclar chooses to exercise its renewal option as outlined
in that Section.
(d)
Simclar shall reimburse Landlord
for Landlord's actual Real Property Taxes (as defined in Section
9(b)) and its reasonable cost of real estate insurance. Such
reimbursement shall be shared on a pro-rata square footage basis
with other tenants in the Building as set forth in Exhibit B
hereto. It is estimated that the combined expense for Real Property
Taxes and insurance for the current year will be $0.26 per square
foot. Such reimbursement shall be paid monthly in the amount of
$1,144.56, to be paid along with the Rent and adjusted annually if
Real Property Taxes and insurance costs differ materially from the
estimate. After comparing the estimated payments made by Simclar
with the actual tax and insurance expenses, any overpayment or
shortfall by Simclar shall be refunded to Simclar or paid to
Landlord, as the case may be. Landlord will provide
Simclar with a copy of the tax bill and invoice for the insurance
premium within five (5) business days after receipt of written
demand therefor.
4. Maintenance .
(a) Simclar . Simclar agrees at its sole cost and expense to
(i) keep the Simclar Premises in good order, condition and repair,
normal wear and tear excepted; (ii) maintain and repair that
portion of the roof over the Simclar Premises unless covered by
Landlord's insurance or warranty thereon, in which case Landlord
shall have sole responsibility therefor; (iii) maintain the grounds
area on Lot 4, which shall be limited to litter and trash clean up
and snow and ice removal; and (iv) maintain the grounds area on Lot
1 together with Astral, which maintenance shall be limited to
mowing, litter and trash clean up, and snow and ice removal, the
cost of which Simclar agrees to share with Astral in a prorated
amount equal to its percentage portion of the Building (30.85%).
With respect to snow removal, mowing and similar maintenance for
Lot 1, Simclar and Astral have discussed the possibility and are
entitled to reach a separately negotiated agreement concerning the
payment of such maintenance items as between them which deviates
from the strict percentage prorata allocation provided above. For
purposes of clarity, the parties agree that Simclar shall have no
responsibility for maintaining or repairing any portion of the roof
that is not directly over the Simclar Premises. Additionally, the
parties agree that Simclar shall be responsible for the
installation and maintenance of any existing or required sprinkler
system or other fire protection system. With respect to the
maintenance of grounds area on Lot 4, it is agreed that the area to
the south of the paved parking on Lot 4 quickly transitions from
pavement to grass to heavily wooded area. The parties agree that
neither the Landlord nor Simclar is obligated to mow or otherwise
maintain that area to the south of Lot 4. Simclar shall be
responsible for coordinating the procurement and payment of any
shared grounds maintenance with Astral. Notwithstanding the
foregoing, any damage that is the result of an act or omission or
the negligence of Landlord or Landlord's employee, customer,
supplier, or guest, the cost and repair of which shall be the
responsibility of Landlord.
(b) Landlord . Landlord agrees at its sole cost and expense
to (i) keep the structure, exterior walls and foundation of the
Building in good order, condition and repair and repair the roof
over the Simclar Premises if and to the extent damage to the roof
is covered by insurance or manufacturer's warranty, (ii) maintain
and repair the portion of the Building not being leased by Simclar,
and (iii) maintain and repair the parking areas on Lot 1 and Lot 4,
including paving, sealing, and striping the parking areas;
provided, however, any such maintenance of the parking areas shall
be done solely at Landlord's sole discretion on an as needed basis
and Simclar acknowledges that Landlord has no present plans to do
any such maintenance. Landlord shall not be responsible for any
maintenance, repair or replacement of any of the Simclar Premises
other than as is specifically set forth herein. Notwithstanding the
foregoing, any damage to the exterior walls, foundation, or roof
that is the result of an act or omission or the negligence of
Simclar or Simclar's employee, customer, supplier, or guest, the
cost and repair of which shall be the responsibility of
Simclar.
(c) Simclar will make repairs promptly upon
becoming aware of a condition needing repair. If it is a condition
for which Landlord is responsible and Landlord fails to complete
any repairs within twenty (20) days of receiving Simclar's notice
of a defective condition (or if Landlord fails to commence repair
and diligently pursue the same to completion if the defective
condition is of the type can not be remedied within 20 days), then
Simclar may make the necessary repairs and deduct the actual costs
for the repairs, provided they are commercially reasonable, from
the Rent payments next coming due until Simclar has been completely
reimbursed.
5. Use of Simclar Premises; Compliance with
Law . Simclar shall use
the Simclar Premises only for lawful purposes. Landlord shall
maintain (1) the portions of the Simclar Premises that Landlord is
obligated to maintain, repair or replace pursuant to this Lease
Agreement, (2) the portion of the Building not being leased by
Simclar and (3) the parking areas on Lot 1 and Lot 4 (hereinafter
“Landlord Items”) at all times so as to comply with and
conform to the laws, ordinances, orders and regulations of
applicable governmental authorities, including those relating to
public health, sanitation and safety (hereinafter
“Governmental Requirements”), and that Landlord will
promptly make any changes or alterations necessary in order that
the Landlord Items conform to all Governmental Requirements then in
force and effect. Simclar shall maintain the portions of the
Simclar Premises that Simclar is obligated to maintain, repair, or
replace pursuant to this Lease Agreement (hereinafter “Tenant
Items”) at all times so as to comply with and conform to
Governmental Requirements, and Simclar shall promptly make any
changes or alterations necessary in order that the Tenant Items
conform to all Governmental Requirements then in force and effect.
Additionally, Simclar shall be responsible for any compliance with
Governmental Requirements that is necessitated by (a) alterations,
changes or additions made by Simclar; or (b) Simclar's particular
use of the Simclar Premises.
6. Destruction or Damage to Simclar
Premises . If the Simclar
Premises are destroyed or damaged to an extent that Simclar's
ability to carry on its normal business function is effectively
denied by casualty, this Lease Agreement shall, at the option of
Simclar, terminate as of the date specified by Simclar in a written
notice to Landlord. If, as allowed above, Simclar does not elect to
terminate this Lease Agreement or the damage does not rise to the
level that Simclar's ability to carry on its normal business
function is effectively denied, Landlord shall promptly restore the
Simclar Premises to an architectural unit as nearly like its
condition prior to such casualty, and the Rent shall be abated on
an equitable basis, based upon the extent to which the Simclar
Premises are untenable or unusable, until the date of completion of
restorations by Landlord.
7. Simclar's Property . All movable partitions, other fixtures,
business and trade fixtures, machinery and equipment,
communications equipment and office equipment, including, without
limitation, all furniture, furnishings and other articles of
movable personal property owned by Simclar and located on the
Simclar Premises shall be and shall remain the property of Simclar
and may be removed by Simclar at any time during the Lease Term or
any extension or renewal thereof. All alterations of a construction
nature, including walls, ceilings, electrical fixtures, and other
such items shall become a part of the Building and belong to the
Landlord upon expiration of the Lease Agreement. For purposes of
clarity, all improvements such as free-standing cabinets and
specialty equipment that can be removed without damaging walls,
floors or any other part of the Building shall belong to Simclar,
and Simclar may, at Simclar's option, remove any such
non-permanently affixed alterations constituting trade fixtures,
fixtures, furniture, equipment, and other personal property at the
expiration or termination of the Lease Term or renewal term. Any
personal property of Simclar which shall remain on the Simclar
Premises after Simclar gives up possession of the Simclar Premises
may, at the option of the Landlord, be deemed to have been
abandoned and may be retained by Landlord as its property or may be
disposed of without accountability, in such manner as the Landlord
may see fit. The terms of this Paragraph 7 shall survive the
expiration or earlier termination of the Lease
Agreement.
8. Condemnation .
(a) If during the Lease Term the whole of the
Simclar Premises shall be lawfully condemned or taken (hereinafter
both are referred to as a “Taking” or being
“Taken”) in any manner for any public or quasi-public
use or purpose, this Lease Agreement and the term and estate hereby
granted shall forthwith cease and terminate as of the date
of vesting of title pursuant to the Taking.
(b) If a part of the Simclar Premises shall be
Taken during the Lease Term, then the part so Taken shall no longer
constitute part of the Simclar Premises, but this Lease Agreement
shall continue in force and effect as to the part not so Taken. If
any partial Taking materially impairs Simclar's ability to conduct
its business from the Simclar Premises, Simclar (in its sole
discretion) may deem the partial taking a Taking of the entire
Simclar Premises and terminate this Lease Agreement. If a partial
Taking does not result in the termination of this Lease Agreement,
Landlord shall promptly restore that portion of the Simclar
Premises that remains to an architectural unit as nearly like its
condition prior to such Taking and the Rent shall be reduced on an
equitable basis, based upon the extent of the partial Taking
(effective the first day after the Taking).
(c) Landlord shall be entitled to receive the
entire award in any proceeding with respect to any Taking (other
than for a temporary use and occupancy) provided for in this
Paragraph 10 which occurs during the Lease Term without deduction
therefrom for any estate vested in Simclar by this Lease Agreement,
and Simclar shall receive no part of and shall and does hereby
assign to Landlord any such award, except as hereinafter expressly
provided. Simclar shall have the right to make a separate claim
with the condemning authority for (i) any moving expenses incurred
by Simclar as a result of such condemnation; (ii) any costs
incurred and paid by Simclar in connection with any alteration or
improvement made by Simclar to the Simclar Premises; (iii) the
value of any of Simclar's property so Taken; and (iv) any other
separate claim which Simclar may be lawfully permitted to
make.
(d) If all or any part of the Simclar Premises
shall be temporarily Taken during the Lease Term, then, at the
option of Simclar, this Lease Agreement shall remain in full force
and effect, except that the Rent shall be reduced on an equitable
basis, based upon the extent and duration of the temporary Taking.
Simclar shall continue to be responsible for all of its obligations
hereunder insofar as such obligations are not affected by
such Taking. Upon the expiration of any temporary Taking, Landlord
shall have no obligation to restore the Simclar Premises to their
former condition.
9.
Utilities and Taxes
.
(a)
Utilities . The parties hereto acknowledge that utilities
for the Building have not been separately metered for the
individual tenants. The parties further acknowledge that the cost
to meter the utilities separately is high. Therefore, the parties
agree that electric, gas, and water utilities will be paid in full
to the utility provider by Simclar and that Simclar will invoice
Astral for Astral's portion of such utilities, defined as
follows:
i.
Simclar hereby agrees to enter into
a Shared Utilities Agreement with Astral in a form substantively
identical to Exhibit C hereto.
ii.
Simclar shall contract for and pay
for any utilities it requires other than electric, gas, and water,
including but not limited to telephone, data lines, communications
lines, cable and other such services.
iii.
Subject to Simclar's right of
reimbursement, Simclar is responsible for paying utilities that
Simclar or Astral consume until the end of the Lease Term and such
liability shall survive the expiration or termination of the Lease
Agreement. For purposes of clarity, the parties agree that, in the
event Astral fails to pay for its share of the utilities as is
required in the Shared Utilities Agreement, Simclar shall be
responsible for all utilities incurred on Lot 1 and Simclar shall
have the right to seek legal redress from Astral as set forth in
the Shared Utilities Agreement. Landlord shall never be responsible
for any utilities on Lot 1; provided, however, should Astral vacate
the portion of the Building being leased by Astral, Landlord will
take reasonable steps to reduce the utility consumption in that
portion of the Building as much as reasonably possible by, for
example, setting the thermostat at a seasonally appropriate
setting, turning off the lights, and making sure there are no
running water faucets.
iv.
In the event that the Astral Lease
expires or is terminated and Landlord desires to lease the premises
to another tenant, Landlord shall give Simclar written notice of
the name and any information reasonably necessary for Simclar to
determine the financial responsibility of the proposed tenant (the
“Proposed Tenant Notice”). Simclar in its sole
discretion shall make a determination in writing no later than 15
days after receipt of the Proposed Tenant Notice as to whether
Simclar will enter into a shared utilities agreement with the
proposed tenant or require Landlord to cause the utilities to be
separately metered (which right Landlord agrees Simclar shall
have)
(b)
Taxes . Landlord shall be responsible for paying all
Real Property Taxes, in a timely fashion as the same become due and
payable for Lot 1 and Lot 4. The term 'Real Property Taxes' shall
include, without limitation, all real estate taxes assessed by any
federal, state, county, municipal or quasi-governmental authority,
ad valorem real estate taxes, special assessments, value added
taxes, documentary taxes, stamp taxes and any other taxes based on
or relating to the real property or improvements thereof. Simclar
is responsible for and shall reimburse Landlord 30.85% of the Real
Property Taxes for Lot 1 (said 30.85% representing the percentage
of the total square footage of the Building leased by Simclar) and
100% of the Real Property Taxes for Lot 4.
10.
Insurance; Release; and
Indemnity .
(a)
Landlord Insurance
. Landlord agrees to purchase (at
its sole cost and expense) and keep in force (i) insurance on the
Building against damage by fire and other perils under ISO Special
form in an amount equal to the full replacement cost thereof with
such reasonable deductions as would be carried by a prudent owner
of a reasonably similar building, having regard to size, age and
location; (ii) Comprehensive General Liability Insurance at the
minimum limit of not less than $1,000,000.00 per occurrence for
bodily injury and property damage (iii) such other insurance as
Landlord reasonably considers advisable in such reasonable amounts
and with such reasonable deductions as would be carried by a
prudent owner of a reasonably similar building, having regard to
size, age and location. Simclar shall reimburse Landlord for its
share of such insurance as set forth in Section 3 (d)
hereof.
(b)
Simclar Insurance
. Simclar agrees to purchase (at
its sole cost and expense) and keep in force Comprehensive General
Liability Insurance on Lots 1 and 4 and the Building, at the
minimum limit of not less than $1,000,000.00 per occurrence for
bodily injury and property damage arising out of the activities and
operations of Simclar and any other person on the Simclar Premises
or performing work on behalf of Simclar and shall name Landlord as
an additional insured. Such Comprehensive General Liability
Insurance may be carried by Simclar through an Umbrella Liability
policy. Upon request by Landlord, Simclar shall furnish Landlord a
certificate indicating that the insurance policy is in full force
and effect, that Landlord has been named as an additional insured,
and that the policy may not be cancelled unless ten (10) days prior
written notice of the proposed cancellation has been given to
Landlord. Simclar agrees to purchase (at its sole cost and expense)
and keep in force property insurance including fire and other
perils under ISO Special form, including, but not limited to
sprinkler leakage, in an amount equal to the full replacement cost
of all property owned by Simclar, or for which Simclar is
responsible, including all of the Simclar improvements constructed
by or on behalf of Simclar. Simclar agrees to maintain workers'
compensation insurance on its employees on the Simclar Premises
with at least the statutorily mandated limits of coverage. Nothing
contained in this Section 12 shall be construed as a requirement
for Landlord to insure Simclar's personal property or
equipment.
(c)
Release . Notwithstanding anything to the contrary
contained herein, Landlord and Simclar each herewith and hereby
releases and relieves the other and waives its entire right of
action against the other for any loss or damage to the Building or
Simclar Premises or Lots 1 or 4, which loss or damage is insured
the coverage actually maintained by the damaged party as
required by this Section 10. The casualty insurance obtained by
Landlord and Simclar, respectively, shall include a full waiver of
subrogation by the respective insurers of Landlord and
Simclar.
(d)
Indemnity . Landlord agrees to indemnify and hold Simclar
and its agents and employees, harmless from and against all costs,
claims, suits, causes of action, damages, and liability (including
reasonable attorney's fees) in connection with any loss of life,
personal injury, or damage to property in or about Lot 1 or Lot 4
or arising out of the use of Lot 1 or Lot 4 or arising out of the
use of the Simclar Premises by Landlord, its agents, employees,
invitees, or contractors, or occasioned in whole or in part by
Landlord, its agents, employees, invitees, or contractors unless
such loss, injury or damage was caused by the negligence or willful
misconduct of Simclar, its agents, employees, invitees, or
contractors. Simclar agrees to indemnify and hold Landlord and its
agents and employees, harmless from and against all costs, claims,
suits, causes of action, damages, and liability (including
reasonable attorney's fees) in connection with any loss of life,
personal injury, or damage to property in or about the Simclar
Premises or arising out of the use or occupancy of the Simclar
Premises by Simclar, its agents, employees, invitees or
contractors, or occasioned in whole or in part by Simclar, its
agents, employees, invitees or contractors, unless such loss,
injury or damage was caused by the negligence or willful misconduct
of Landlord, its agents, employees, invitees, or contractors. The
covenants, obligations and liabilities under this Section 10(d)
shall survive the expiration or earlier termination of this Lease
Agreement.
11.
Default. Rights and
Remedies .
A.
The following shall constitute
events of default:
(1)
Nonpayment
. Simclar's failure to pay Rent or
any other amount due under this Lease Agreement and such failure
continues for ten (10) days after written notice from Landlord that
such rental or amount was not paid when due.
(2)
Failure to Perform
. Simclar's failure to perform any
material obligation under this Lease Agreement (other than the
payment of Rent or any other amounts due under this Lease Agreement
and including, but not limited to the Shared Utilities Agreement)
within thirty (30) days after notice of nonperformance; provided,
however, that if the breach is of such a nature that it cannot be
cured within thirty (30) days, Simclar shall be deemed to have
cured if cure is commenced promptly and diligently pursued to
completion; and provided further, that in the event of a breach
involving an imminent threat to health or safety, Landlord may in
its notice of breach reduce the period for cure to such shorter
period as may be reasonable under the circumstances.
(3)
Assignment or Sublease Without
Consent . If there shall
be an assignment or sublease by Simclar, whether voluntarily or
involuntarily, other than in accordance with Section 13;
(4)
Execution and Attachment Against
Simclar . If Simclar's
interest under this Lease Agreement or in the Simclar Premises
shall be taken upon execution or by other process of law directed
against Simclar, or shall be subject to any attachment at the
instance of any creditor or claimant against Simclar and said
attachment shall not be discharged or disposed of within thirty
(30) days after the levy thereof; and
(5)
Bankruptcy or Related
Proceedings . If Simclar
shall file a petition in bankruptcy or insolvency .or for
reorganization or arrangement under the bankruptcy laws of the
United States or under any similar act of any state, or shall
voluntarily take advantage of any such law or act by answer or
otherwise, or shall be dissolved or shall make an assignment for
the benefit of creditors; if involuntary proceedings under any such
bankruptcy or insolvency law or for the dissolution of Simclar
shall be instituted against Simclar and is not dismissed within
sixty (60) days; or if a receiver or trustee shall be appointed for
the Simclar Premises or for all or substantially all of the
property of Simclar, and such proceedings shall not be dismissed or
such receivership or trustee vacated within sixty (60) days after
such institution or appointment.
B.
Upon any event of default by
Simclar, Landlord shall have the right, at Landlord's election,
then or any time thereafter, to exercise any one or more of the
following remedies, provided exercise of any of these remedies
shall not prevent the concurrent or subsequent exercise of any
other remedy provided for in this Lease Agreement or otherwise
available to Landlord at law or in equity:
(1)
Cure by Landlord
. Landlord may, at Landlord's
option, but without obligation to do so, and without releasing
Simclar from any obligations under this Lease Agreement, make any
payment or take any action as Landlord may deem necessary or
desirable to cure any such Simclar default in such manner and to
such extent as Landlord may deem necessary or desirable. Landlord
may do so without demand on, or written notice to, Simclar. Simclar
shall pay Landlord, within ten (10) days after demand, all
advances, costs and expenses of Landlord in connection with the
making of any such payment or the taking of any such
action.
(2)
Termination of Lease and
Damages . Landlord may
terminate this Lease Agreement, effective at such time as may be
specified by written notice to Simclar, and demand and recover
possession of the Simclar Premises from Simclar. Simclar shall
remain liable to Landlord for damages in an amount equal to the
Rent and other amounts payable hereunder which would have been
owing by Simclar hereunder for the balance of the Lease Term had
this Lease Agreement not been terminated, less the net proceeds, if
any, of any re-letting of the Simclar Premises by Landlord
subsequent to such termination, after deducting all Landlord's
expenses in connection with such recovery of possession or
re-letting. Landlord shall be entitled to collect and receive such
damages from Simclar on the days on which the applicable Rent would
have been payable if this Lease Agreement had not been
terminated.
(3)
Repossession and
Re-letting . Landlord may
reenter and take possession of the Simclar Premises or any part
thereof without demand or notice, and repossess the same and expel
Simclar and any party claiming by, through or under Simclar, and
remove the effects of both using such force for such purposes as
may be necessary, without being liable for prosecution on account
thereof or being deemed guilty of any manner of trespass, and
without prejudice to any remedies for arrears of rent or right to
bring any proceeding for any default. No such reentry or taking
possession of the Simclar Premises by Landlord shall be construed
as an election by Landlord to terminate this Lease
Agreement unless a written notice of such intention is given to
Simclar. No notice from Landlord hereunder or under a forcible
entry and detainer statute or similar law shall constitute an
election by Landlord to terminate this Lease Agreement unless such
notice specifically so states. Landlord reserves the right,
following any reentry or re-letting, to exercise its right to
terminate this Lease Agreement by giving Simclar such written
notice, in which event the Lease Agreement will terminate as
specified in said notice. After recovering possession of the
Simclar Premises, Landlord may re-let the Simclar Premises, or any
part thereof: for the account of Simclar, for such term and on such
conditions as Landlord, in its sole and subjective discretion, may
determine. Landlord may make such repairs, alterations or
improvements as Landlord may consider appropriate to accomplish
such re-letting. Notwithstanding Landlord's recovery of possession
of the Simclar Premises, Simclar shall continue to pay on the dates
herein specified, the amounts which would be payable hereunder if
such repossession had not occurred. Upon the expiration or earlier
termination of this Lease Agreement, Landlord shall refund to
Simclar any amount, without interest, by which the amounts paid by
Simclar, when added to the net amount, if any, recovered by
Landlord through any re-letting of the Simclar Premises, exceeds
the amounts payable by Simclar under this Lease
Agreement.
(4)
Other Remedies
. Pursue any other remedies
available at law or in equity.
12. Landlord Default . Unless otherwise specified elsewhere in this
Lease Agreement, if Landlord fails to perform any material
provision of this Lease Agreement within thirty (30) days (or such
additional time as Landlord shall reasonably require in the event
such failure cannot be reasonably cured within such thirty (30) day
period and Landlord has within thirty (30) days after notice of
default from Simclar commenced to cure said default and is
diligently prosecuting same to completion) after the receipt of
written notice from Simclar to Landlord that Landlord is in default
hereunder, then Simclar may terminate this Lease Agreement by
giving to Landlord notice of Simclar's intention to do so, in which
event the Lease Term shall end, and all obligations shall cease as
of and on the date stated in such
notice.
13. Assignment .
(a) Simclar may assign or transfer this Lease
Agreement or any interest herein, voluntarily or by operation of
law, and may sublet or license the whole or any part of the Simclar
Premises upon the written consent of Landlord, which consent shall
not be unreasonably withheld. Notwithstanding the foregoing, upon
ten (10) days prior written notice to Landlord, Simclar shall have
the right, without Landlord's consent, to sublet all or a portion
of the Simclar Premises or to assign this Lease Agreement to any
entity which is an Affiliate (as hereinafter defined) of Simclar.
As used herein, “Affiliate” shall mean any entity (a)
that directly owns more than fifty percent (50%) of the voting
shares, membership interests or other controlling interests in
Simclar, or (b) in which Simclar owns such
controlling interests, or (c) with which Simclar is in common
control by virtue of the ownership of such controlling interests in
the entity and Simclar by one or more persons or entities. No
consent to an assignment or sublease shall constitute consent to
any further assignment or subletting. Simclar shall remain fully
liable for the payment and performance of all obligations of
Simclar under this Lease Agreement, notwithstanding any assignment
or sublease, for the entire Lease Term.
(b) Landlord may assign this Lease Agreement
without the consent of Simclar. Furthermore, Landlord hereby
acknowledges the option to purchase and the right of first refusal
set forth in Section 30 held by Simclar, which option and right of
first refusal shall be unaffected by any assignment by Landlord. In
the event of any transfer of Landlord's interest in this Lease
Agreement, the transferor shall cease to be liable and shall be
released from all liability for the performance or observance of
any agreements or conditions on the part of Landlord to be
performed or observed subsequent to the time of said transfer,
provided that such transferee assumes in writing all
of Landlord's obligations hereunder.
14.
Time of Essence
. Time is of the essence relative to
this Lease Agreement.
15.
Holding Over
. If Simclar remains in possession
after the termination or expiration of the Lease Term, without any
written agreement of the parties, Simclar shall occupy the Simclar
Premises on a month-to-month basis at two times the rental rate
then in effect. Simclar's month-to-month tenancy may be terminated
by either party on thirty (30) days prior written
notice.
16.
Surrender of Simclar
Premises . Upon
expiration of the Lease Term, Simclar shall surrender the Simclar
Premises and keys thereto to Landlord, broom clean, in the same
condition (except for the alterations made pursuant to Section 26,
which Simclar shall not be required to remove) as at the
commencement of the Lease Term, normal wear and tear and repairs
that are the Landlord's responsibility excepted.
17.
Notices . Any and all notices or other communications
required or permitted to be given hereunder shall be sent by United
States registered or certified mail (return receipt requested),
postage prepaid, and addressed as follows:
If to
Simclar:
Simclar
Interconnect Technologies, Inc.
Porter Wright
Morris & Arthur LLP
If to
Landlord:
With a copy
to:
1949 East
Sunshine, Suite 2-300
Either party may from time to time change the
address to which notice or other communications may be delivered or
sent by giving the other party written notice of such change sent
in accordance with this Paragraph 17.
18. Quiet Enjoyment . Landlord covenants that it has the right to
lease the Simclar Premises for the Lease Term, and agrees Simclar
shall and may peaceably and quietly have, hold and enjoy the
Simclar Premises without disturbance by Landlord or anyone claiming
by, through or under Landlord.
19. Subordination . This Lease Agreement is and shall be subject
and subordinate to all the terms and conditions of all underlying
mortgages that may now or hereafter encumber Lots 1 and 4. Landlord
at Landlord's cost and expense shall obtain for the benefit of
Simclar within 30 days after the date of this Lease Agreement or
the date any subsequent mortgage is executed a nondisturbance
agreement satisfactory to Simclar and Landlord's mortgage lender
from any and all mortgage lenders, if any, having a lien on Lot 1,
Lot 4, or Simclar Premises prior to this Lease Agreement or a
leasehold or ownership interest on Lot 1, Lot 4, or Simclar
Premises prior to this Lease Agreement pursuant to which such party
acknowledges that Simclar's interest in the Simclar Premises and
rights under this Lease Agreement shall not be disturbed so long as
Simclar is not in default hereunder beyond any applicable grace or
cure period. The party holding the instrument to which this Lease
Agreement is subordinate shall recognize and preserve this Lease
Agreement in the event of any foreclosure sale or possessory
action, and in such case this Lease Agreement shall continue in
full force and effect, and Simclar shall attorn to such party and
shall execute, acknowledge and deliver any instrument that has for
its purpose and effect the confirmation of such
attornment.
20. Definitions . The term “Landlord” as used in
this Lease Agreement shall include Landlord's heirs, executors,
administrators, personal representatives, successors, assigns and
successors-in-title to the Simclar Premises. The term
“Simclar” as used in this Lease Agreement shall include
Simclar's heirs, executors, administrators, personal
representatives and successors and, if this Lease Agreement shall
be validly assigned or sublet, shall also include Simclar's
assignees or subtenants, as to that portion of the Simclar Premises
covered by such assignment or sublease. The terms
“Landlord” and “Simclar” shall include male
and female, singular and plural, corporation, partnership or
individual, as may fit the particular parties, and as may be
required by the particular context.
21. Applicable Law . This Lease Agreement shall be governed by and
construed in accordance with the laws of the state where the
Simclar Premises are located.
22. Severability . If any term, covenant or condition of this
Lease Agreement or the application thereof to any person or
circumstance shall to any extent be invalid or unenforceable,
neither the remainder of this Lease . Agreement nor the
application of such term, covenant or condition to any other person
or circumstance shall be affected thereby; and each term, covenant
or condition of this Lease Agreement shall be valid and enforceable
to the fullest extent permitted by law.
23. Entire Agreement . This Lease Agreement sets forth the entire
agreement between Landlord and Simclar relative to the Premises and
no representations, warranties, inducements, promises or
agreements, oral or written, between the parties not embodied
herein shall be of any force or effect.
24. Memorandum of Lease Agreement
. Landlord and Simclar shall execute
and deliver a Memorandum of Lease Agreement (the
“Memorandum”), if requested by either party, after the
execution and delivery of this Lease Agreement, in recordable form,
and which either party may record at its own expense at the
applicable Recorder of Deeds or similar office in the County
wherein the Simclar Premises are located.
25. Right to Enter .
(a) Permitted Entries. Landlord and its agents,
servants, and employees may enter the Simclar Premises during
Simclar's normal business hours, or other times mutually agreed to
by Landlord and Simclar, accompanied by Simclar if requested by
Simclar, to: (i) examine the Simclar Premises; (ii) show the
Simclar Premises to prospective lessees, lenders or purchasers;
(iii) post notices of non-responsibility; (vi) post “For
Sale” and “For Lease” signs; and (v) perform any
maintenance or repairs on or in the Simclar Premises as are
required or allowed by Landlord.
(b) Entry Conditions. Notwithstanding Paragraph
25(a), entry is conditioned upon Landlord: (i) giving Simclar at
least twenty-four (24) hours advance notice, except in an
emergency; (ii) promptly finishing any work for which it entered;
and (iii) causing no practical interference to Simclar's business.
If the Landlord or Landlord's agents cause damage to Simclar's
property, Landlord shall be liable for any such damage.
26.
Alterations
.
(a)
Simclar accepts the Simclar
Premises in as-is condition. Simclar's acceptance of the Simclar
Premises as-is does not alter nor diminish Landlord's maintenance,
repair and replacement obligations contained elsewhere in this
Lease Agreement.
(b)
Simclar shall, at its sole cost and
expense and subject to the provisions set forth in the Work Letter
which is attached hereto as Exhibit D and incorporated
herein by this reference, furnish and install or cause to be
furnished and installed in the Simclar Premises, in a good and
workmanlike manner and with reasonable diligence, the Tenant
Improvements (as defined in the Work Letter). With respect to the
Tenant Improvements and all other alterations and improvements
performed by Simclar at the Simclar Premises or the Building,
Simclar shall be solely responsible, at Simclar's sole cost and
expense, to obtain and maintain all applicable governmental
approvals, permits, and licenses.
(c)
Simclar will promptly pay all costs
associated with the Tenant Improvements, including but not limited
to architectural, engineering, permit, construction, and other
related costs, so that no lien against Lot 1 or Lot 4 can
legitimately be placed. Simclar shall not cause or permit any
mechanics' liens, materialmen's liens or other liens to be filed
against the Simclar Premises as a result of any alterations or
other work performed on the Simclar Premises, and will (within
thirty (30) days after notice from Landlord to Simclar of such
lien(s)) cause any such liens to be removed or Simclar shall obtain
a bond in the amount of such lien while the matter is
resolved.
(d)
All improvements or alterations to
the Simclar Premises including, but not limited to the Tenant
Improvements described above, shall be at Simclar's sole cost and
expense and shall be performed in a good and workmanlike manner in
accordance with all applicable laws and ordinances.
(e)
All improvements or alterations to
the Simclar Premises, except the Tenant Improvements described
above which shall be approved in accordance with the Work Letter,
shall be subject to Landlord's prior written consent, which such
consent shall not be unreasonably withheld; provided, however,
Simclar may perform interior, non-structural modifications to the
Simclar Premises, such as painting, relocation of a light fixture,
etc., without the prior written consent of Landlord.
27.
Brokers . Each party hereto represents and warrants to
the other that the only real estate broker or agent involved in
this transaction is R.B. Murray Company of Springfield, Missouri,
(“R.B. Murray”) and that the fee due to R.B. Murray
shall be paid exclusively by the Landlord. Each party hereto agrees
to indemnify the other and hold it harmless from and against any
and all claims, losses, costs or expenses (including reasonable
attorney's fees and expenses) for commissions or other compensation
or charges claimed by a broker or agent other than R.B. Murray for
dealings with such party with respect to this Lease
Agreement.
The parties hereto acknowledge that R.B. Murray
Company has a listing contract with the Landlord, and all brokerage
fees due thereunder are being paid by Landlord. In the event
Simclar does not exercise its renewal option as set forth in
Section 2, Simclar shall reimburse Landlord an amount equal to the
unamortized brokerage fees paid by Landlord to R.B. Murray relative
to this Lease Agreement, which was calculated based on a lease term
of 10 years. The parties acknowledge and agree that the fee paid to
R.B Murray by Landlord with respect to this Lease Agreement was
Seventy Thousand Seven Hundred Twenty Dollars
($70,720.00).
28. Counterparts . This Lease Agreement may be signed in one or
more counterparts, each of which is deemed an original, but any of
which taken together constitutes one and the same
instrument.
29. Attorney's Fees . In the event either party shall find it
necessary to obtain the services of an attorney to enforce any of
the covenants or conditions of this Lease Agreement, the prevailing
party shall be entitled to reimbursement for all costs and
expenses, in
