Exhibit 10.18
LEASE AGREEMENT
1. Parties . This Lease,
dated as of January 1, 2004, (the “ Effective Date
”), is made by and between Crown Packaging Technology, Inc.,
a Delaware corporation (“ Lessor ”), and
Constar, Inc., a Pennsylvania corporation (herein called “
Lessee ”).
2. Premises . Lessor hereby
leases to Lessee and Lessee leases from Lessor for the term, at the
rental, and upon all of the conditions set forth herein, at that
certain real property known as 11535 South Central Avenue, Alsip,
Illinois (the “ Land ”), a portion (the “
Premises ”) of the building located thereon (the
“ Building ”), all as more particularly shown on
Exhibit A attached hereto and made a part hereof.
3. Term .
3.1. The term of this Lease shall
commence on the Effective Date and end on December 31, 2006 (the
“ Termination Date ”), unless sooner terminated
pursuant to any provision hereof.
3.2. Lessor may in its sole
discretion terminate this Lease at any time upon one year’s
written notice to Lessee. Lessee may at its sole discretion
terminate this Lease at any time upon one year’s written
notice to Lessor.
4. Rent . Lessee shall pay to
Lessor, in advance, by the 1st day of each month following the
Effective Date (each a “ Rent Payment Date ”),
an amount equal to the Monthly Base Rent (the “ Rent
”) plus any other amounts then due under this Lease. If the
first or last month of the Lease is less than a full month, Rent
shall be a pro rata portion of the monthly Rent. Rent shall be
payable in lawful money of the United States to Lessor at the
address stated herein or to such other persons or at such other
places as Lessor may designate in writing.
4.1. Monthly Base Rent . For
the period January 1, 2004 to December 31, 2004, the “
Monthly Base Rent ” shall be Forty-Five Thousand Five
Hundred Dollars ($45,500) per month; for the period of January 1,
2005 to December 31, 2005, the “ Monthly Base Rent
” shall be Forty-Six Thousand Eight Hundred Sixty-Five
Dollars ($46,865) per month; and for the period January 1, 2006 to
December 31, 2006, the “ Monthly Base Rent ”
shall be Forty-Eight Thousand Two Hundred Seventy Dollars ($48,270)
per month.
The Monthly Base Rent includes costs for
utilities, janitorial services, guard services, trash removal,
cleaning services, cafeteria use, parking lot use, coffee service,
common areas, restaurant overhead (but not food charges) and local
real estate taxes.
5. Use .
5.1. Use . The Premises shall
be used and occupied only for general office use, for use or
laboratories and for the running of pilot line equipment for
product and process development purposes, and for no other purpose.
Lessee agrees to restrict itself, its employees, contractors,
agents and invitees to occupancy solely of the Premises.
5.2. Compliance with Law .
Lessee shall, at Lessee’s expense, comply promptly with all
applicable statutes, ordinances, rules, regulations, orders,
restrictions of record, and requirements in effect during the term
or any part of the term hereof regulating the use by Lessee of the
Premises. Lessee shall not use or permit the use of the Premises in
any manner that will tend to create waste or a nuisance or, if
there shall be more than one tenant in the building containing the
Premises, shall tend to disturb such other tenants.
5.3. Condition of Premises .
Lessor makes no warranty or representation as to the Premises.
Lessee acknowledges and agrees that it has occupied and
familiarized itself with the Premises and has had adequate
opportunity to investigate and inspect the condition of the
Premises, and enters into this Lease upon the basis of its own
review, and is leasing the Premises in their “AS IS, WHERE
IS” CONDITION WITH ALL FAULTS, WHETHER PREVIOUSLY EXISTING OR
ARISING FROM OR PERTAINING TO ANY CONSTRUCTION, RENOVATION,
RELOCATION OR IMPROVEMENT OF ANY PORTION OF THE PREMISES PERFORMED
BY LESSOR OR OTHERS, INCLUDING BUT NOT LIMITED TO BOTH LATENT AND
PATENT DEFECTS. EXCEPT AS EXPRESSLY SET FORTH TO THE CONTRARY IN
THIS LEASE, NO WARRANTIES, EXPRESS OR IMPLIED, ARE MADE BY LESSOR
OR ANY OF ITS AFFILIATES CONCERNING SUCH ITEMS, INCLUDING BUT NOT
LIMITED TO, WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. LESSEE HEREBY WAIVES AND DISCLAIMS ANY
WARRANTIES THAT MAY ARISE BY OPERATION OF LAW.
Lessee further acknowledges and
agrees that it has had an opportunity to review and to discuss with
various agents and/or representatives of Lessor the environmental
condition of the Premises. Lessee has investigated and has
knowledge of operative or proposed governmental laws and
regulations including, without limitation, environmental laws and
regulations to which the Premises are or may be subject and enters
into this Lease upon the basis of its review and determination of
the applicability and effect of such laws and regulations. Lessee
acknowledges that Lessor expressly disclaims any representations or
warranties of any kind or nature, express or implied, as to the
condition (financial or otherwise), value or quality of the
products, assets or properties of the Premises.
Lessee hereby accepts the Premises
in their condition existing as of the Effective Date, subject to
all applicable zoning, municipal, county and state laws, ordinances
and regulations governing and regulating the use of the Premises,
and accepts this Lease subject thereto and to all matters disclosed
thereby and by any exhibits attached hereto.
Lessee hereby agrees that all
furniture, equipment, machinery and all other personal property,
excepting any computers, that are located on or in the Premises as
of the Effective Date shall remain on the Premises as and when
Lessee evacuates the Premises on the Termination Date or any
extension thereof.
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5.4. Hazardous Substances
.
(a) Lessee shall not use nor allow
the Premises to be used for the Release (as defined below),
generation, transportation, storage, use, treatment, disposal or
other handling (“ Management ”) of any Hazardous
Substance, except (i) in the ordinary course of operations, (ii) in
full compliance with applicable federal, state and local
environmental statutes, ordinances, rules, regulations, codes,
orders, ordinances, Environmental Permits (as defined below),
notice and consent or settlement agreements in effect at any time
during the term of this Lease (“ Environmental Laws
”), and (iii) with the prior written consent of Lessor.
Lessee shall not implement any modifications of current operations
or activities or implement any new operations or activities at the
Premises that materially change the type or quantity of, or manner
in which Hazardous Substances are Managed or Released at the
Premises without Lessor’s prior written consent.
(b) Lessee shall comply with and
will cause its agents, representatives, invitees, employees,
subtenants of Lessee or any other occupant to comply with all
Environmental Laws applicable to the Premises, or the Release or
Management of Hazardous Substances at, on, about or from the
Premises or the Lessee’s use, operations or activities at the
Premises.
(c) Lessee shall obtain in its own
name any and all environmental permits, certificates, licenses,
approvals, registrations and authorizations (“
Environmental Permits ”) required by Environmental
Laws for the Premises and the conduct of its operations or
activities at the Premises, maintain all such Environmental Permits
in full force and effect, timely file all renewal applications and
remain in compliance with all such Environmental
Permits.
(d) To the extent required by and
within the time period required by Environmental Laws, Lessee shall
report any release, spill, leak, discharge, disposal, pumping,
pouring, emission, emptying, injecting, leaching, dumping escaping
or threat thereof (“ Release ”) of any
hazardous, toxic or polluting substance, waste or material,
pollutant or contaminant including, without limitation, petroleum
or petroleum products, asbestos, PCBs or radioactive materials
(“ Hazardous Substance ”) at, on, from or
affecting the Premises first arising after the Effective Date
during the term of the Lease (or arising, directly or indirectly,
from Lessee’s or its affiliates’ use of the Premises
prior to the Effective Date) to the appropriate governmental
authorities and immediately provide notice of such Release to
Lessor including a description of measures taken or proposed to be
taken by Lessee to respond to such Release. To the extent that
investigation, remedial action or other response action (“
Response Action ”) is required by Environmental Law
for such a Release, Lessee shall promptly undertake such action to
the extent required by applicable Environmental Laws and to the
extent necessary so as not to materially effect the condition, use,
value, operations or possession of the premises and shall
indemnify, defend and hold Lessor harmless with respect thereto and
for any damage to property, person, and/or the
environment.
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(e) Lessee will promptly notify
Lessor of any known Release of Hazardous Substances at, on, from or
affecting the Premises, including any Release caused by Lessee, its
employees, agents, representatives, invitees, employees,
subtenants, other occupants or trespassers (which Release is not
made pursuant to and in conformance with the terms of an
Environmental Permit) regardless of whether such Release first
occurred prior to or after the Effective Date and of any
non-routine governmental filings made or notices received from any
governmental authority or private party during the Lease Term and
relating to environmental matters or conditions at or in the
vicinity of the Premises.
(f) If Lessor reasonably believes
Lessee is in breach of any of the covenants in Section 5.4
of this Lease, Lessor may upon notice to Lessee request an
independent engineer or other qualified consultant or expert
acceptable to Lessor, to conduct, at Lessee’s expense, an
environmental assessment of the Premises and immediate surrounding
areas, and the scope of work to be performed by such engineer,
consultant, or expert shall be approved in advance by Lessor, and
all of the engineer’s, consultant’s, or expert’s
work product shall be made available to Lessor. Notwithstanding
Lessee’s obligations under this Section 5.4(f) ,
Lessor, in its sole discretion, may conduct environmental
assessments of the Premises at any time.
(g) At Lessor’s request from
time to time, Lessee shall execute affidavits, representations and
the like concerning Lessee’s knowledge and belief regarding
the presence of Hazardous Substances at, on, about or from the
Premises.
(h) Lessee shall reimburse Lessor,
upon demand, the reasonable cost of any testing for the purpose of
ascertaining if there has been any Release of Hazardous Substances
at, on, about or from the Premises, if such testing is required by
any governmental agency, applicable Environmental Laws or
Lessor’s Mortgagee.
(i) Lessee shall, upon expiration of
this Lease, surrender the Premises to Lessor free from the presence
of any Hazardous Substances used by Lessee, its employees, agents,
representatives, invitees, employees, subtenants, other occupants
(other than Lessor, its agents, representatives, invitees or
employees) or trespassers or any existing conditions aggravated by
the acts or omissions of Lessee (and not resulting from the
negligent acts of the Lessor).
(j) Lessee shall be responsible for
all regulatory requirements in connection with any storage tanks,
asbestos or asbestos containing materials, polychlorinated
biphenyls, and Hazardous Substances located at, on or about the
Premises.
(k) Lessor and Lessee shall
reasonably cooperate in connection with any Response Actions to be
conducted at, on or about the Premises, including but not limited
to keeping the other reasonably informed of such Response Actions
and executing any necessary documents or consents required to be
executed in connection thereto. Lessee will notify Lessor, and
provide Lessor the opportunity to attend, all meetings with
applicable authorities in connection with any suggested, threatened
or pending Response Action, and Lessor shall have
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the right to approve in advance all proposed
Response Actions. Lessor will, when reasonable under the
circumstances, notify Lessee prior to commencing Response Actions
required to be performed by Lessor and shall minimize, to the
extent reasonably possible, interference with Lessee’s
operations or activities at the Premises. To the extent permitted
by the Environmental Laws, Lessee shall allow Lessor to utilize
Lessee’s Environmental Permits to implement Response Actions
at, on or about the Premises.
(l)
Indemnification
(i) In addition to any other
indemnifications contained in this Lease, Lessee shall indemnify
and hold harmless Lessor, its partners, associates, and employees
(“ Lessor Indemnitees ”), from and against any
and all liability, damages, costs or expenses (including costs of
Response Actions, fines, penalties, and attorney’s fees)
(“ Costs ”) resulting from any claim, demand,
liability, obligation, right or cause of action including but not
limited to governmental action (collectively, “ Claims
”) that are incurred by or are asserted against Lessor
Indemnitees or the Premises to the extent arising out of or
relating to (x) environmental conditions including, without
limitation, the presence or Release of Hazardous Substances at, on,
about or from the Premises; (y) violations or alleged violations of
Environmental Laws at the Premises which first arise after the
Effective Date other than due to the negligent acts of Lessor, or
arise, directly or indirectly, from Lessee’s or its
affiliates’ use of the Premises prior to the Effective Date;
or (z) breaches of this Lease.
(ii) The indemnities of Lessee
contained in this Section 5.4(l) will survive termination of
this Lease.
(iii) For any Claim for which Lessee
is required to indemnify or hold harmless Lessor Indemnitees
pursuant to this Section 5.4 , Lessor may determine, in its
sole discretion, whether Lessee shall perform or pay for Lessor
Indemnitees’ performance.
6. Maintenance, Repairs and
Alterations .
6.1. Lessee’s
Obligations . Except as otherwise expressly set forth herein,
Lessee shall keep in good order, condition and repair the Premises
and every part thereof, structural and non structural, (whether
such portion of the Premises requiring repair, or the means of
repairing the same, are reasonably or readily accessible to Lessee,
and whether the need for such repairs occurs as a result of
Lessee’s use, any prior use, the elements or the age of such
portion of the Premises). If Lessee fails to perform Lessee’s
obligations under this Section 6 , Lessor may at its option
(but shall not be required to) enter upon the Premises, after
thirty (30) days prior written notice to Lessee, and put the same
in good order, condition and repair, and the cost thereof including
an administrative fee to Lessor of 10% of such cost, shall become
due and payable as additional rent to Lessor together with
Lessee’s next Rent installment.
6.2. Surrender . On the last
day of the term hereof, or on any sooner termination, Lessee shall
surrender the Premises to Lessor in substantially the same
condition as when received, broom clean, ordinary wear and tear,
damage by fire or other casualty excepted.
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Lessee shall repair any damage to the Premises
occasioned by the removal of Lessee’s trade fixtures,
furnishings and equipment pursuant to Section 6.5(d) , which
repair shall include the patching and filing of holes and repair of
structural damage. Upon mutual agreement of the parties, the
parties may jointly videotape the Premises at any time within two
(2) days after the Effective Date for the purposes of attempting to
document the then-current condition of the Premises.
6.3. Lessor’s Rights .
Notwithstanding anything stated in Section 6.1 hereof, the
Lessor may from time to time conduct such maintenance and repairs
of the Premises as Lessor deems necessary. Lessor shall submit to
Lessee a statement of the costs and expenses of such maintenance
and repairs, and Lessee agrees to pay to Lessor such costs together
with the next Rent installment.
6.4. Intentionally Omitted
.
6.5. Alterations and
Additions .
(a) Lessee shall not, without
Lessor’s prior written consent, which will not be
unreasonably withheld, make any alterations, improvements,
additions or Utility Installations in, on or about the Premises. As
used in this Section 6.5 the term “ Utility
Installation ” shall mean bus ducting, power panels,
wiring, fluorescent fixtures, space heaters, conduits, air
conditioning equipment and plumbing. Lessor may require that Lessee
remove any or all of such alterations, improvements, additions or
Utility Installations at the expiration of the term and restore the
Premises to their prior condition. Lessee shall provide to Lessor,
at Lessee’s sole cost and expense, a lien and completion bond
in an amount equal to one and one-half times the estimated cost of
any such improvements to insure Lessor against any liability for
mechanic’s and materialmen’s liens and to insure
completion of the work. Should Lessee make any alterations,
improvements, additions or Utility Installations without the prior
written approval of Lessor, Lessor may require that Lessee remove
any or all of the same.
(b) Any alterations, improvements,
additions or Utility Installations in or about the Premises that
Lessee shall desire to make shall be presented to Lessor in written
form, with proposed detailed plans, and shall not be made until
Lender has consented in writing. If Lessor shall give its consent,
the consent shall be deemed conditioned upon Lessee acquiring a
permit for such alteration, improvement, addition or Utility
Installation from appropriate governmental agencies, the furnishing
of a copy thereof to Lessor prior to the commencement of the work
and the compliance by Lessee of all conditions of such permit in a
prompt and expeditious manner.
(c) Lessee shall pay, when due, all
claims for labor or materials furnished or alleged to have been
furnished to or for Lessee at or for use in the Premises, which
claims are or may be secured by any mechanics’ or
materialmen’s lien against the Premises or any interest
therein. Lessee shall give Lessor not less than ten (10)
days’ notice prior to the commencement of any work in the
Premises, and Lessor shall have the right to post notice of
non-responsibility in or on the Premises as provided by law. If
Lessee shall, in good faith,
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contest the validity of any such lien, claim or
demand then Lessee shall, at its sole expense, defend itself and
Lessor against the same and shall pay and satisfy any such adverse
judgment that may be rendered before the enforcement, upon the
condition that Lessee shall furnish to Lessor a surety bond
satisfactory to Lessor in an amount equal to such contested lien,
claim or demand indemnifying Lessor against liability for the same
and holding the Premises free from the effect of such lien or
claim. In addition, Lessee shall pay Lessor’s attorneys fees
and other costs in participating in such action if Lessor shall
decide it is to its best interest to do so.
(d) Unless Lessor requires their
removal as set forth in Section 6.5(a) , all alterations,
improvements, additions and Utility Installations (whether or not
such Utility Installations constitute trade fixtures of Lessee),
which may be made on the Premises, shall become the property of
Lessor and remain upon and be surrendered with the Premises at the
expiration of the term.
7. Insurance Indemnity
.
7.1. Insuring Party . Lessor
shall purchase and pay for various insurance policies covering the
Land and the Building generally, including property
insurance.
7.2. Liability Insurance .
Lessee shall, at Lessee’s expense, obtain and keep in force
during the term of this Lease a policy of Combined Single Limit,
Bodily Injury and Property Damage Insurance insuring Lessor and
Lessee against any liability arising out of the ownership, use,
occupancy or maintenance of the Premises and all areas appurtenant
thereto. Such insurance shall be a combined single limit policy in
an amount not less than Three Million Dollars ($3,000,000.00). The
policy may contain cross liability endorsements and may insure
performance by Lessee of the indemnity provisions of this
Section 7 . The limits of such insurance shall not, however,
limit the liability of Lessee hereunder. In the event that the
Premises constitute a part of a larger property such insurance
shall have a Lessor’s Protective Liability endorsement
attached thereto. If Lessee shall fail to procure and maintain such
insurance, Lessor may, but shall not be required to, procure and
maintain the sa