ASSIGNMENT AND ASSUMPTION OF LEASE
THIS
ASSIGNMENT AND ASSUMPTION OF LEASE (this "Assignment")
is made and entered into as of the
1st day of December, 2005, by
and between LOUDON ROAD N.H. RTE. 9
DEVELOPMENT, LLC, a New York
limited liability company ("Assignor"),
and AEI INCOME &
GROWTH
FUND 25 LLC, a Delaware limited liability
company ("Assignee").
RECITALS:
A. Assignor and Assignee
(predecessor-in-interest to AEI Fund Management,
Inc.) are parties to that certain Purchase
and Sale Agreement dated October
7, 2005, (the "Agreement"), pursuant to
which Assignee is acquiring from
Assignor the real property, and
improvements located on such property, more
particularly described on EXHIBIT A
attached hereto and incorporated herein
by this reference (the "Premises").
B. Pursuant to the terms of the
Agreement, Assignor desires to sell, assign,
convey, transfer and set over to Assignee
and Assignee desires to assume all
of Assignor's interest in that certain
Lease dated June 30, 2005 (the "Lease")
by and between Assignor and Sterling, Inc.
(the "Tenant"), including all rents
prepaid for any period subsequent to the
date of this Assignment, and all of
Assignor's interest in that certain
Guaranty dated June 24, 2004 by and
between Assignor and Sterling Jewelers,
Inc. (the "Guarantor") subject to the
terms and conditions set forth below.
C. Assignor is the Landlord under the Lease
and Guaranty with full right and
title to assign the Lease, the Guaranty,
and the "Rent" (as defined below) to
Assignee as provided herein. The Lease and Guaranty are in full
force and
effect and have not been modified or
amended. So far as is
known to Assignor,
there is no default by Tenant under the
Lease, and no Rent has been waived,
anticipated, discounted, compromised or
released.
NOW, THEREFORE,
in consideration of the Recitals, which are
hereby made a part hereof, for other good and valuable
consideration, the receipt and sufficiency of
which are hereby
acknowledged by the parties, Assignor and
Assignee hereby
agree
as follows:
1. Assignor hereby irrevocably and
unconditionally sells, assigns, conveys,
transfers and sets over unto Assignee, its
heirs, successors and assigns as
of the date hereof (the "Effective Date"),
all of Assignor's right, title and
interest in, to and under: (i) the Lease,
(ii) the Guaranty, and (iii) any
and all rents prepaid as of the Effective
Date, held by Assignor in connection
with the Lease (the "Rent").
2. Except as otherwise set forth
in Paragraph 4 hereof, Assignee hereby
assumes and shall be liable for any and all
liabilities, claims, obligations,
losses and expenses, including reasonable
attorneys' fees arising in
connection with the Lease or the Guaranty
which are actually incurred, and
which arise by virtue of acts or omissions
occurring thereunder on or after
the Effective Date. Assignor shall
indemnify and hold Assignee harmless from
any and all liabilities, claims,
obligations, losses and expenses, including
reasonable attorneys' fees arising in
connection with the Lease or the
Guaranty which are actually incurred, and
which arise by virtue of acts or
omissions occurring thereunder, prior to
the Effective Date.
Except as
otherwise set forth in Paragraph 4 hereof,
Assignee shall indemnify and hold
Assignor harmless from any and all
liabilities, claims, obligations, loss and
expenses, including reasonable attorneys
fees, arising in connection with the
Lease or as a result of Assignee's failure
to fulfill the landlord's duties
and obligations accruing under the Lease,
or the Guaranty on or after the
Effective Date. Assignee shall be entitled to
receive all income arising from
the Lease from and after said Effective
Date. Assignor shall be entitled to
receive all income accruing from the Lease
prior to the Effective Date.
3. Assignor shall direct the
Tenant and any successor tenant under the
Lease to pay to Assignee the Rent and all
other monetary obligations due
or to become due under the Lease for the
period beginning on the Effective
Date.
4. Notwithstanding anything
contained herein or implied hereby to the
contrary, Assignor shall remain liable for
the performance of the obligations
of the "Landlord" under the Lease with
respect to Landlord's obligations under
Section 15 of the Lease.
5. This Assignment shall be
governed by and construed in accordance with the
laws of the state in which the Property is
located.
6. All rights and obligations
of Assignee and Assignor hereunder shall be
binding upon and inure to the benefit of
Assignor, Assignee and the heirs,
successors and assigns of each such
party.
7. This Assignment may be executed in
any number of counterparts, each of
which shall be effective only upon delivery
and thereafter shall be deemed an
original, and all of which shall be taken
to be one and the same instrument,
for the same effect as if all parties
hereto had signed the same signature
page. Any signature page of this Assignment
may be detached from any
counterpart of this Assignment without
impairing the legal effect of any
signatures thereon and may be attached to
another counterpart of this
Agreement identical in form hereto but
having attached to it one or more
additional signature pages.
8. Whenever the context so
requires in this Assignment, all words used in
the singular shall be construed to have
been used in the plural (and vice
versa), each gender shall be construed to
include any other genders, and
the word "person" shall be construed to
include a natural person, a
corporation, a firm, a partnership, a joint
venture, a trust, an estate or
any other entity.
IN WITNESS
WHEREOF, Assignor and Assignee have executed this
Assignment effective as of the day and year
first above written.
ASSIGNOR:LOUDON ROAD N.H. RTE 9 . DEVELOPMENT, LLC, a
New York limited liability company
By:Westlake Holding, Inc., a New York corporation
Its: Sole member
By: /s/ Joseph P Kane
Joseph P. Kane,
President
STATE OF NEW YORK
)
) ss.
COUNTY OF ONONDAGA )
The forgoing
instrument was acknowledged before me this
29 day of November, 2005, by Joseph P.
Kane, as President of
Westlake Holding, Inc., sole member of
Loudon Road N.H. Rte. 9
Development, LLC, a New York limited
liability company, on behalf
of said limited liability company.
WITNESS my hand
and official seal.
My commission
expires
/s/ Stephen G Etoll
Notary Public
[Notarial Seal]
ASSIGNEE: AEI INCOME & GROWTH FUND 25 LLC,
a Delaware limited liability company
By: AEI Fund
Management XXI, Inc.,
A Minnesota corporation
Its: Managing Member
By:/s/ Robert P Johnson
Robert P. Johnson, President
STATE OF MINNESOTA )
) ss.
CITY/COUNTY OF RAMSEY )
The forgoing
instrument was acknowledged before me this 1st day of
December, 2005, by Robert P. Johnson, as
President of AEI Fund Management XXI,
Inc., Managing Member of AEI INCOME &
GROWTH FUND 25 LLC, a Delaware limited
liability company, on behalf of said
limited liability company.
WITNESS my hand
and official seal.
/s/ Jennifer Schreiner
Notary Public
[Notarial Seal]
EXHIBIT A TO ASSIGNMENT AND
ASSUMPTION OF LEASE AND GUARANTY
Legal Description
A certain tract of land with any buildings
and improvements
thereon, situated in the City of Concord,
County of Merrimack,
State of New Hampshire, being shown as
Lot 1 on a plan of
land
entitled, "Subdivision Plat of land of
Berkshire-Concord, LLC Map
111E, Block 1, Lots 1, 4, 5 & 6 Map
111F, Block 2, Lot 8"
dated
February 15, 2005 revised through June 8, 2005
by Richard D.
Bartlett & Associates, LLC, which Plan
is recorded with the
Merrimack County Registry of Deeds as Plan No. 17480 (the
"Plan"), being, more particularly bounded and described as
follows:
Commencing at a steel pin set on the
northerly sideline of Loudon
Road, said pin marking
the southeasterly most corner of the lot
herein described; thence
By a curve to the left, having a central
angle of 47 21'09" and a
radius of 39.50 feet, a
distance of 32.65 feet to a point;
thence
By a curve to the right, having a
central angle of 24 22'03" and
a radius of 184.50 feet, a
distance of 78.47 feet to a steel pin;
thence
N35 34'20"W a distance of 105.40 feet to a
steel pin; thence
S54 25'40"W a distance of 145.50 feet to a
steel pin; thence
S35 33'45"E a distance of 185.26 feet to a
steel pin on said
sideline of Loudon Road; thence
N 63 53' 05" E a distance of 93.60 feet
to the point of
beginning.
TOGETHER WITH rights under that certain Reciprocal Easement
Agreement dated July 15, 2005,
by and between Loudon Road N.H. Rte.9 Development, LLC and
Berkshire-Concord, LLC recorded
with the Merrimack County Registry of Deeds
at Book 2801, Page
786.
LEASE
BETWEEN
LOUDIN ROAD N.H. RTE. 9 DEVELOPMENT, LLC
a New York limited liability company
AND
STERLING
INC.,
an Ohio, corporation
Dated: June 30,
2005
LEASE
In consideration
of the rents and covenants set forth below,
Landlord (as hereinafter defined) hereby
leases to Tenant (as
hereinafter defined), and Tenant hereby
leases from Landlord, the
Premises (as hereinafter defined), upon the
following terms and
conditions:
ARTICLE 1
FUNDAMENTAL LEASE PROVISIONS
The provisions in this Article shall be
referred to in this Lease
as the "Fundamental Lease Provisions."
1.1 EXHIBITS TO LEASE. The
following exhibits are attached
to and made a part of ~s Lease, and are
incorporated herein
by
reference:
EXHIBIT "A".
The description of the Premises.
EXHIBIT "B".
The site plan showing the layout of
the Shopping Center, and the location of the
Premises and
the Building, parking areas,
driveways, common
areas, the
Protected
Area and other
improvements to be constructed in
the Shopping
Center (the "Site Plan").
EXHIBIT "C".
The list of Tenant's prototypical
Plans and Specifications prepared and provided by
Tenant and approved by
Landlord, wherein are
detailed
Landlord's Work
(as hereinafter defined) in the
Premises.
EXHIBIT "C-1"
. The list of
items which
comprise
Tenant's Work
(as hereinafter defined).
EXHIBIT "D".
Tenant's exterior sign
drawings
prepared
and provided by Tenant and approved by
Landlord,
wherein are
detailed Tenant's exterior sign(s).
EXHIBIT "E".
The Premises Cost.
EXHIBIT "F".
Tenant's Trade Fixtures which shall
remain the
personal property of Tenant and which Tenant may
remove upon
expiration or termination of this Lease.
EXHIBIT "G"
The existing exclusives for which
the Premises may
not be used.
EXHIBIT "H".
The form of Guaranty of Lease to be
executed by
Sterling Jewelers Inc.
1.2
DEFINITIONS. Unless
otherwise defined
herein, capitalized terms used in this Lease shall have
the meanings
listed
in the Fundamental Lease
Provisions.
1
Building:
shall mean
the building containing
approximately 5,996 square feet of floor
area and
all improvements thereto
(including
Tenant's Work)
to be
constructed on
the Premises and as
identified on
Exhibit "B" attached
hereto.
Commencement
Date: shall
mean the earlier of thirty (30)
days after the Delivery Date or the day
that Tenant
opens for and conducts
business in the Premises.
Construction
Period: shall
mean that period
commencing
on the date of
execution of this
Lease
and ending on October 31, 2005.
Delivery Date:
shall
mean
the date that Landlord
delivers the
Premises to
Tenant with
Landlord' s
Work
fully
complete
(excepting the
Punchlist Items (as
hereinafter defined)).
Fixed Monthly
Rent:
11% of the Premises Cost (as
detailed on
Exhibit "E") divided by
twelve, subject to proration as provided
in Section 2.3, which for Lease Years 1-
5 shall be
Twenty-three Thousand
Eight
Hundred Seventy-four
and 58/lOO Dollars
($23,874.58) per month ($286,495.00 per
annum).
Force Majeure:
shall mean the
occurrence of one of
the
below listed
events which prevents,
delays or hinders the performance of any
act required hereunder
(other than the
payment of
money): strikes,
lockouts,
inability to procure materials, failure
of power, restrictive
governmental laws
or regulations,
riots, insurrection,
war, or any other reason of a like
nature n~t
the fault of the party
delayed in performing work or doing any
act required
under the terms
of this
Lease.
Gross Leasable
Area:
shall mean the number of
square feet of
the Building.
Increase Date:
fifth
(5th)
anniversary
of the
Commencement Date, and
every five
(5)
years
thereafter, including
Renewal
Terms.
Increase
Percentage:
ten percent (10% )
Initial Term:
twenty (20)
Lease Years, plus any
Partial Lease Years, commencing on the
Commencement Date.
Landlord:
Loudon Road N ,H. Rte. 9
Development, LLC
c/o Westlake Development, LLC
753 James Street, Suite B-1
Syracuse, New'York 13203
2
Fax:
(315) 471-6436
With copies to:
Shulman Curtin Grundner & Regan, P.C.
250 S. Clinton Street, Suite 502
Syracuse, New York 13202
Attn: Stephen G. Etoll, Esq.
FAX: (315) 424-8205
Landlord' s
Work: shall
mean the work to be
performed by
or at the direction of Landlord in
constructing the Premises, the Building
and related
improvements,
as more
particularly specified
in Article 15
below and Exhibit "C".
Lease Y ear:
shall mean
a period of twelve (12)
consecutive calendar months during the
Term, the first of which shall begin on
the first day of February next following
the Commencement
Date, (unless the
Commencement Date shall be the first day
of February, in which
event the first
Lease Year
shall
begin
on the
Commencement Date) and
ending on the
following January 31.
Partial Lease
Year:
shall mean the period, if any, of
fewer than
twelve
(12) consecutive
calendar months between the Commencement
Date and the first day of the first
Lease Year, and the
period, if any, of
less than
twelve
(12) consecutive
calendar months between the last day of
the last Lease Year and the expiration
of the Lease Term.
Permitting
Period:
shall mean the period commencing on
the date of this Lease and ending on June
30,2005.
Proposed Use:
shall mean
the display
and sale, at
retail, of
gold, silver, diamonds,
colored
gemstones and
other
fine
jewelry, watches, and
clocks, crystal,
porcelain, and
related items
normally
sold in Tenant's other stores and,
as
incidental thereto,
the repair
and/or
appraisal of the same.
Plans and
Specifications: shall mean the
prototypical
plans and specifications for the
construction of the Premises which were
previously delivered to and approved by
Landlord, a list of which is set forth
on attached Exhibit "C" as the same may
be modified only by written agreement by
and between Landlord and Tenant.
Premises:
shall mean
that certain real
property having .60 acres as more
3
particularly described in Exhibit " A "
together with
all improvements
to be
constructed thereon,
located at the
Shopping Center Site
in the city of
Concord, County of
Merrimack, State
of
New Hampshire,
and having
the street
address 297 Loudon
Road, together
with
all appurtenances,
rights and easements
(including the benefit
of all rights
under the "Easement
Agreement" defined
in Section
13.6 below)
and exclusive
rights, if
any,
granted
herein
applicable to the
Premises, as
further
depicted on the Site Plan.
Premises Cost:
shall
mean the agreed upon cost to
perform Landlord's
Work, which cost
is
computed on Exhibit "E" attached hereto
and made a part hereof.
Premises Site:
shall mean the land described
on Exhibit "A".
Public Entity:
shall
mean the Federal,
State, County,
municipal or
other governmental unit
however denominated,
and any agency,
division, department or public official
thereof, now
or hereafter having
jurisdiction, in any respect, over the
Premises.
Punchlist Items:
shall
mean such minor,
incomplete items
of Landlord's
Work which do not
materially deviate
from the Plans
and
Specifications or
materially
interfere
with Tenant's ability to open or operate
the Premises.
Purchase
Agreement shall
mean that certain Purchase and
Sale Agreement between Berkshire-Concord
LLC -and Landlord' s
affiliate entity,
McFarland
Development, LLC ("
Affiliate"), entered
into on March
15,2005 whereby
Landlord shall
obtain
fee simple title to the Premises.
Renewal
Terms:
four (4) additional terms of
five{5) year(s) each.
Shopping Center
shall mean the
Patriot's Place Shopping
Center located at 295- 299 Loudon Road,
Concord, N.H.,
consisting of a
tenant
building" A
" having approximately
50,000 square feet and
tenant building
"B" having
approximately 22,200
square
feet, the Premises,
Building, and
the
Common Areas,
and other improvements
located upon the Shopping Center Site as
further depicted on the Site Plan.
Shopping Center
Site
shall mean the land shown on
Exhibit "B", on which the Shopping Center
is located.
4
Shopping Center
Owner
Berkshire-Concord, LLC, its
successors and assigns.
Sign Drawings:
shall
mean the plans and
specifications
for Tenant's
exterior sign(s)
on the
Premises, in the form of Exhibit "D" as
the same may be modified only by written
agreement by
and between Landlord
and
Tenant.
Tenant:
Sterling Inc.
375 Ghent Road
Akron, Ohio 44333
Attn: Real Estate Department
F AX: (330) 668-5050
With copies to:
Brouse McDowell LP A
1001 Lakeside Avenue, Suite 1600
Cleveland, Ohio 44114
Attn: David A. Lum, Esq .
F AX: (216) 830-6807
Tenant's Work:
shall
mean the work to be
performed by
or at
the direction of Tenant in
fixturing the
Premises
as
more
specifically identified on Exhibit "C-
1", attached
hereto.
Tenant's Trade
Fixtures: those
items listed on attached
Exhibit "F" which are
and shall remain
the personal property of Tenant.
ARTICLE 2
TERM AND RENT
2.1 TERM. The
Initial Term of this Lease shall be as
set forth in the Fundamental Lease Provisions.
Provided
Tenant is not
then in default under this Lease, Tenant shall
have the option
to extend the Initial Term by the number of
successive
Renewal Terms described in the Fundamental Lease
Provisions by
giving Landlord written notice of its election
to extend the term of this Lease for
the succeeding Renewal
Term
not less than one hundred eighty (180)
days prior to
the expiration of the Initial Term or the thel1-running
Renewal
Term, as the case may
be. Excepting the
amount of
the Fixed Monthly Rent, as adjusted, the terms and
conditions
of this Lease shall apply during
each Renewal
Term. The
Initial Term, as it may be extended by one or more
Renewal
Terms, shall be hereinafter referred to as the
"Lease
Term."
2.2 Intentionally
Omitted.
2.3 FIXED MONTHLY
RENT. For the use and occupancy of
the Premises,
Tenant shall
5
pay Landlord the Fixed Monthly Rent,
in advance, commencing
on the Commencement Date and
continuing on the first day of
each
calendar month thereafter during the Lease Term,
without
any offset or deduction except as specifically
provided
for herein. The Fixed Monthly Rent
payable under
this Lease shall
increase by the Increase Percentage on each
Increase
Date. Should the Lease TeI1D commence
on a day
other
than the first day of a calendar
month, then the
rental for such
first fractional month shall be computed on
a daily basis for the period from
the Commencement Date
to
the end of such calendar month at an
amount equal to 1/30th
of the Fixed Monthly Rent for each day.
Should the
Lease
Term
end on a day other than the last day of
a calendar
month,
then the rental for
such fractional month
shall be
computed
on a daily basis at an
amount equal to 1/30th
of
the Fixed Monthly Rent for each day. Tenant sh'a1l pay
Landlord
the Fixed Monthly Rent in lawful
money of the
United
States at the address
for Landlord set forth in the
Fundamental
Lease Provisions, or to such other persons or at
such
other places as Landlord may designate
in writing to
Tenant.
Landlord and Tenant
acknowledge that the
Premises
Cost
computation on Exhibit
E is based on Landlord's review
of the prototypical Plans and
Specifications. Within thirty
(30)
days
after
receipt
of the final Plans and
Specifications
from Tenant, Landlord shall notify Tenant in
writing
of any differences between the
prototypical Plans
and Specifications and the final Plans and
Specifications
which
increase the Premises Cost set forth on attached
Exhibit
"E", together with at least three (3)
bids which
support
such increase. Within fifteen (15) days after
receipt of such
notice from Landlord, Tenant shall have the
right to object
to Landlord's proposed increase by providing
written
notice to Landlord, including
a bid to support
Tenant's
objection.
Landlord and Tenant
shall thereafter
cooperate
with each other to
resolve such dispute including
obtaining an
independent bid to resolve such discrepancy if
necessary. Upon
final resolution of the Premises Cost, but
in any event prior to Landlord's
commencement of Landlord's
Work,
Landlord and Tenant shall enter into a
Supplemental
Lease
Agreement prepared by Tenant which modifies and
replaces the
Premises Cost set forth on Exhibit "E". In the
event
there is no
modification of the Premises -- Cost, or
upon
execution of a
Supplemental Lease Agreement modifying
the Premises Cost, Landlord and Tenant agree that the
Premises Cost
shall be deemed to be final and not subject to
any further adjustment, and that Tenant shall not be
responsible
for any other costs
associated with
Landlord's
Work
except for change orders which have been
initiated,
requested and
approved by Tenant.
2.4 ADDITIONAL
RENT. In addition to the Fixed Monthly
Rent,
as increased, Tenant shall pay to the parties
respectively
entitled
thereto
all Additional Rent,
including, but
not limited to, insurance premiums, Taxes (as
defined
in Article 4), and any other charges,
costs and
expenses
which arise or may be contemplated under any
provision of
this Lease during the Lease Term (collectively,
the "Additional Rent"). Tenant shall
furnish to
Landlord,
promptly
after payment of any
Taxes or insurance
premiums,
and,
with respect to any other Additional
Rent, promptly
upon
request
of Landlord, official receipts or other
satisfactory
proof evidencing payment of such Additional
Rent.
" 2.5
INTEREST AND LATE CHARGES If during the
Lease
Term, Tenant
fails to pay the full amount of any Fixed
Monthly Rent or
Additional Rent within seven (7) days after
receipt of
written notice from Landlord that the same is due
and payable,
then Tenant shall pay to Landlord ... (a)
interest at the
monthly rate of one percent (I %) per month
on the unpaid
amount from and
6
after
the date on which any such sum shall be due and
payable
("Interest");
and (b ) a late charge of fifty
dollars
($50.00) to cover the extra expense
involved in
handling
such delinquency ("Late Charge").
In the event
Landlord has
issued one (1) such notice to Tenant within any
Lease
Year, Interest and a Late Charge shall
automatically
accrue
on any Fixed Monthly
Rent or "Additional Rent which
Tenant
fails to pay when due
during such Lease Year without
Landlord being
required to issue any further notices during
such Lease Year.
Any payment to be made by Tenant under this
Lease
shall be deemed to
have been paid upon the date that
it is received
by Landlord. The provision for Interest and a
Late Charge as
set forth herein shall not be deemed to grant
Tenant
any grace period or extension of
time or prevent
Landlord from
exercising any of its other rights under this
Lease.
2.6 NET LEASE. This
Lease is what is commonly called a
"triple net
lease," it being understood that Landlord shall
receive the
Fixed Monthly Rent free and clear of any and all
Taxes, other
Additional Rent, liens, charges, liabilities or
expenses
of any nature whatsoever incurred
in connection
with the
ownership and operation of the Premises.
ARTICLE 3
USE OF THE PREMISES
3.1 USE OF THE
PREMISES. Tenant shall use the Premises
for the Proposed
Use or any other lawful purpose as long as
such
use does not diminish the value of the
Premises or
violate
any existing exclusive uses then
in effect with
respect
to the Premises
including, but not limited to, the
existing
exclusive uses set
forth on attached Exhibit "G";
provided,
however, that Landlord shall not grant or consent
to any additional exclusive uses
other than as set forth on
Exhibit
"G" without Tenant's prior written
consent which
Tenant shall not
unreasonably withhold.
3.2 COMPLIANCE WITH
LAW.
3.2.1 As
of the Delivery Date,
Tenant shall,
at
Tenant's
sole expense, comply in all respects with all
applicable
laws, ordinances,
orders, rules, or
regulations
of any governmental authorities and with
any directive of
any public officer which shall impose
any violation,
order
or duty upon
Landlord or Tenant with respect to the Premises
or the use or occupation thereof or signage thereon,
including,
without limitation, any governmental law or
statute, rule,
regulation, ordinance, code, policy or rule
of common law now or hereafter in effect
relating to
the
environment,
health or safety .
3.2.2 Tenant
shall not use or permit the Premises
to be used in any manner which will result in waste,
reasonable
wear and tear (subject to Tenant's
obligations
under Section
6.1) and casualty excepted, or the creation of
a nuisance, and Tenant shall
maintain the Premises free of
any
objectionable noises, odors, or disturbances.
3.3 TENANT'S
ENVIRONMENTAL COMPLIANCE. Excepting acts
or omissions of
Landlord or
7
its employees,
contractors or agents, for which Tenant shall
have no
liabilities, Tenant acknowledges and agrees to the
following:
3.3.1 Tenant shall, at
its sole cost and expense at
all times during the Term, comply in
all respects with
the
Environmental
Laws (as defined below) in its use and
operation of the
Premises.
3.3.2 Tenant
shall not use the
Premises for
the
purpose
of storing Hazardous Materials (as
defined below)
except
in full compliance
with the Environmental
Laws and
other applicable
law, and shall not cause the release of any
Hazardous
Materials.
3.3.3 Tenant shall
notify Landlord promptly and in
reasonable
detail in the event that Tenant becomes aware of
or suspects (i) the presence of any
Hazardous Materials
on
the Premises (other than any Permitted
Hazardous Materials,
as defined below), or (ii) a
violation of the Environmental
Laws on the
Premises.
3.3.4 If Tenant uses
or permits the Premises to be
used
so as to subject Tenant, Landlord or
any occupant of
the Premises to a claim of violation of the
Environmental
Laws
(unless
contested in good faith by appropriate
proceedings),
Tenant shall, at its
sole cost and
expense,
immediately
cease or cause cessation of such use or
operations
and shall remedy and fully cure any
conditions
arising
therefrom.
3.3.5 At
its sole cost and
expense, Tenant
shall
(i) immediately pay, when due, the
cost of compliance
with
the Environmental Laws within the
Premises required
as a
result
of any acts or omissions of Tenant,
or as otherwise
required by this
Lease, and (ii) keep the Premises free of
any liens
imposed pursuant to the Environmental Laws due to
the acts or omissions of Tenant, or its employees,
contractors
or agents. Tenant shall, at
all times, use,
handle and
dispose of any Permitted Hazardous Material in a
commercially
reasonable manner and
in compliance with
the
Environmental
Laws and applicable industry standards. Tenant
shall
cooperate
with Landlord in any program between
Landlord
and any. governmental entity for
proper disposal
and/or recovery
of any Permitted Hazardous Material.
3.3.6 Without
limiting any other agreement of
indemnity
by Tenant of Landlord, Tenant hereby
agrees to
indemnify, save
and hold Landlord harmless from and against
any and all
claims, losses, liabilities, damages, penalties,
fines
and expenses of whatever kind or
nature (including,
without
limitation,
reasonable
attorneys'
fees
and
disbursements)
arising from, out of
or by reason of any
violation of
Tenant's covenants and obligations contained in
this
Section by Tenant, or out of any violation of the
Environmental
Laws by Tenant, its owners, employees, agents,
or contractors,
which indemnity obligation shall survive the
expiration or
te1111ination of this Lease.
3.3.7 In the event
that Tenant fails to comply with
the any of the
foregoing requirements of this Section, after
the expiration of the cure period permitted under the
Environmental
Laws, if any, Landlord may, b~t shall not be
obligated
to (i) elect that such failure constitutes a
default
under this Lease; and/or (ii)
take any and all
actions, at
Tenant's sole cost
8
and expense, that Landlord deems
necessary or desirable
to
cure any such
noncompliance. Tenant shall reimburse Landlord
as Additional Rent for any costs incurred by
Landlord in
exercising its
options under this subsection within five (
5) days after
receipt of a bill therefor.
3.3.8 Landlord
acknowledges and covenants that in
the event that through no fault of Tenant,
Tenant's use,
occupancy and
enjoyment of the Premises ("Occupancy") shall
be materially interfered with by
reason of the existence or
remediation of
any Hazardous Materials for a period of one
(1) year or more, then from and after such one
(1) year
period
of interference, a
fair and just proportion of the
rents
and other charges payable hereunder, taking into
account
the nature of the interference to Tenant's
Occupancy,
shall be abated until
Tenant's Occupancy is
no
longer
so interfered. If Tenant's Occupancy
shall be so
materially
interfered with for a period of one (1) year or
more
in the last three (3)
years of the Lease Term or any
Renewal Term,
Tenant shall have the right to terminate this
Lease
by giving written notice to Landlord
of its election
to do so,
whereupon this Lease shall automatically terminate
and end effective as of the date of
such notice and neither
party
shall have any further
obligations hereunder.
During
any time period where Tenant's Occupancy is
so interfered,
Landlord
and Tenant agree to work together
and cooperate
with
one another to rectify and remediate
any Hazardous
Materials
existing on the
Premises and to recover any and
all costs and expenses from the party
responsible for
such
Hazardous
Materials.
3.3.9 The provisions
of this Section shall survive
the expiration
or termination of the Lease Term.
3.4 LANDLORD'S
ENVIRONMENTAL COMPLIANCE. Excepting
acts
or omissions of Tenant or its employees,
invitees,
contractors
or agents, for which Landlord
shall have no
liabilities,
Landlord acknowledges the following:
3.4.1 Landlord
shall not cause or permit any
Hazardous
Materials to be sold, used, stored, brought upon,
released, discharged
or disposed of (collectively a "Use")
in, on, under or about the Premises
without in each
case
obtaining
all necessary permits required in connection
therewith,
and complying with all permit
requirements and
Environmental
Laws, and otherwise taking all appropriate
steps
and making adequate
arrangements to assure that such
Use is in the ordinary course of business
and will be
performed
safely, without
contamination of the Premises or
any portion thereof and fully in compliance with all
applicable
laws.
3.4.2 Without
limiting any other agreement of
indemnity
by Landlord of Tenant,
Landlord hereby agrees
to
indemnify,
save and hold Tenant
harmless from and
against
any and all
claims, losses, liabilities, damages, penalties,
fines
and expenses of whatever kind or
nature (including,
without
limitation,
reasonable
attorneys'
fees
and
disbursements)
arising from, out of
or by reason of any
violation of
Landlord's covenants and obligations. contained
in this Section by Landlord, any violation of the
Environmental
Laws by Landlord, its owners, employees,
agents,
or contractors, any pre-existing Hazardous
Materials,
or the release or discharge of Hazardous
Materials
on the Premises if caused by Landlord, its
contractors,
agents, employees, or
any other person
acting
under Landlord,
which indemnity obligation shall survive the
expiration or
earlier termination of this Lease.
9
3.4.3 The provisions
of this Section shall survive
the expiration
or termination of the Lease Tenn.
3.5 DEFINITIONS.
Capitalized terms used in this
Article 3 and
not otherwise defined herein shall have the
following
meanings.
"HAZARDOUS MATERIALS"
means any of the
following
as defined
by the Environmental Laws: solid
wastes;
medical or
nuclear waste or materials; toxic or
hazardous substances;
natural gas, liquefied
natural
gas or synthetic fuel gas; petroleum products or
derivatives, wastes or contaminants (including, without
limitation, polychlorinated
biphenyls); paint
containing lead;
urea-formaldehyde
foam insulation;
asbestos (including,
without limitation;
fibers and
friable asbestos); explosives, and discharges of sewage
or effluent.
"ENVIRONMENTAL LAWS"
means all requirements of
environmental,
ecological, health,
or industrial
hygiene laws
or regulations or
rules of common law
related to
the Premises, including all
requirements
imposed by any law, rule, order, or regulation of any
federal, state,
or local executive, legislative,
judicial, regulatory, or administrative agency, board,
or authority, which relate to (i) noise; (ii) pollution
or protection of the
air, surface water, ground water,
or land;
(iii) solid, gaseous, or liquid waste
generation, treatment,
storage,
disposal,
or
transportation; (iv)
exposure to Hazardous
Materials;
or (v) regulation of the manufacture, processing,
distribution and commerce, use, or storage of Hazardous
Materials.
"PERMITTED HAZARDOUS MATERIAL" means any Hazardous
Materials which
are necessary and commercially
reasonable for
the provision of any
good or service
related to
the Permitted Uses and which are used,
stored and
disposed of in compliance with all
Environmental Laws.
ARTICLE 4
AXES AND UTILITIES
4.1 PAYMENT OF
TAXES. Tenant shall pay, as Additional
Rent,'
the Taxes (as defined in the following Section)
applicable
to the Premises during
the Lease Tenn.
Landlord
shall
provide Tenant with
copies of any tax bins applicable
to the Premises promptly after receipt of
such bins.
All
such payments
shall be made at least ten (10) days prior to
the delinquency date of such payment.
Tenant shall promptly
furnish Landlord
with satisfactory evidence that such Taxes
have been paid. If any such
Taxes paid by Tenant shall cover
any period of
time prior to, or after the expiration of, the
Lease
Term, Landlord shall
reimburse Tenant to
the extent
required.
If Tenant shall fail to pay any such Taxes,
Landlord
shall have the right (but not the
obligation) to
pay the same, in which case Tenant
shall repay such
amount
plus
any penalties and interest resulting therefrom to
Landlord
within five (5) days after receipt of a bill
therefor.
4.2 DEFINITION OF
"TAXES". As used herein, the term shall include:
10
4.2.1 any-form of real
estate tax or assessment, ad
valorem
tax or gross receipts
tax imposed by any
authority
having
the direct or indirect
power to tax, including, but
not limited to, any town, county, state, or federal
government,
or any school, agricultural,
sanitary, fire,
lighting,
sewer, street, drainage, or other improvement
district
thereof, on, against or with respect to the
Premises,
this Lease, any legal or equitable
interest of
Landlord or any
superior landlord in the Premises, or in the
real
property of which the
Premises are a part,
Landlord's
right
to rent or other income therefrom
and Landlord's
business of
leasing the Premises;
4.2.2 any
tax, fee, levy, assessment, penalty,
interest
or other charge (i) in
substitution of,
partially
or totally, any tax, fee, levy, assessment, or charge
hereinabove
included within this
definition of
Taxes, or
(ii)
any tax or increase in
any tax which is imposed as a
result of a
transfer, either partial or total, of Landlord's
interest
in the Premises to Tenant, or (iii)
any tax or
increase
in tax which is imposed by reason of this
transaction,
any modifications or
changes hereto,
or any
transfers
hereof; and
4.2.3 all
inspection fees, taxes, bonds, permits,
certificates,
assessments and sales, use, property or other
taxes, fees or
tolls of any nature whatsoever (together with
any related interest or penalties) now
or hereafter imposed
against Landlord
or Tenant by any federal, state, county or
local
governmental authority
upon or with respect
to the
Premises,
or the use thereof, or upon the possession;
leasing,
use, operation or other disposition
thereof, or
upon
the rents, receipts or earnings
arising therefrom
or
upon or with
respect to this Lease; and
4.2.4 all
taxes assessed against
and levied upon
trade
fixtures,
furnishings,
equipment,
and all other
personal
property of Tenant
contained in the
Premises or
elsewhere,
which
Tenant shall cause to be separately
assessed and
billed directly to Tenant.
Tenant shall pay when due, or reimburse
and indemnify and
hold
Landlord harmless from and against, any Taxes.
Notwithstanding
the foregoing, the term "~" shall not
include any general income
taxes, inheritance taxes, business profit tax, business
enterprise tax, and estate taxes imposed
upon Landlord.
4.3 TENANT'S RIGHT TO
CONTEST TAXES.
4.3.1 Tenant shall
have the right, at its sole cost
and expense, to
contest the amount or validity, in whole or
in part, of any Taxes by appropriate
proceedings diligently
conducted
in good faith, but no such contest shall be
carried on or
maintained by Tenant after the time limit for
the payment of any Taxes if such contest
would threaten
Landlord's
interest in the Premises and unless Tenant shall
(i) pay the amount involved under
protest; (ii) procure and
maintain a stay
of all proceedings to enforce any collection
of any Taxes, together with all
penalties, interest,
costs
and expenses, by
a deposit of a sufficient sum of money, or
by such undertaking, as may be
required or permitted by law
to accomplish such stay; or (iii)
deposit with Landlord, as
security
for the performance by Tenant of its
obligations
hereunder with
respect to such Taxes, 120% of such contested
amount
or such other reasonable security as may be
reasonably
demanded by Landlord
to insure payment of
such
contested Taxes
and all penalties, interest,
11
costs and
expenses which may accrue during the period of the
contest.
Upon the ten11ination of any such proceedings,
Tenant
shall pay the amount
of such Taxes or part
thereof,
as finally
determined in such proceedings, together with any
costs,
fees (including all
reasonable attorneys'
fees and
expenses),
penalties or other liabilities in connection
therewith;
provided, however,
that if Tenant has
deposited
cash
or cash equivalents with Landlord as
security under
clause (iii)
above, then, so long as no default exists under
this
Lease, Landlord shall arrange to pay such
Taxes (or
part
thereof) together with
the applicable costs, fees and
liabilities
as described above out of such
cash or cash
equivalents
and return any unused balance, if any, to
Tenant.
Otherwise,
Landlord shall
return to Tenant all
amounts, if any,
held by or on behalf of Landlord which were
deposited by
Tenant in accordance with such clause (iii).
4.3.2 Tenant shall
have the right, at its cost and
expense,
to seek a reduction in the valuation of the
Premises
as assessed for tax
purposes and to prosecute any
appropriate
action or proceeding in connection
therewith.
Provided Tenant
is not in default hereunder, Tenant shall be
authorized
to retain any tax refund of
any tax paid by
Tenant.
4.3.3 Landlord
agrees that-
whenever Landlord's
cooperation is
required in any proceeding brought by Tenant
to contest any tax, Landlord will reasonably cooperate
therein,
provided same shall
not entail any cost, liability
or expense to
Landlord. Tenant shall pay, indemnify and save
Landlord
harmless of and from, any and all liabilities,
losses,
judgments,
decrees, costs and
expenses
(including
all reasonable attorneys' fees and
expenses) in
connection
with
any such contest and shall, promptly
after the final
settlement,
fully pay and discharge the amounts which shall
be levied,
assessed, charged or imposed or be deten11ined to
be payable therein or in connection
therewith, and
Tenant
shall
perform and observe all acts and obligations, the
performance of
which shall be ordered or decreed as a result
thereof. No such
contest shall subject Landlord to the risk
of any civil liability or the risk of any criminal
liability,
and Tenant shall give
such reasonable
indemnity
or security to Landlord as may reasonably be
demanded by
Landlord
to insure compliance
with the foregoing provisions
of this
Section.
4.4 PAYMENT
OF UTILITIES.
Beginning on the
Delivery
Date,
Tenant shall pay to the utility companies
or other
parties entitled
to payment the cost of all water, heat, mr
conditioning,
gas,
electricity,
telephone,
and other
utilities
and services provided
to or for the Premises. If
any utility
service is interrupted for a period in excess of
seventy-two
(72) hours due to the
negligence or intentional
misconduct
of Landlord, its agents, contractors or
employees, Fixed
Monthly Rent shall abate until such time as
such utility
service resumes.
ARTICLE 5
INSURANCE AND INDEMNIFICATION
5.1 TENANT'S
INSURANCE. From and after taking
possession of
the Premises, Tenant shall carry and maintain,
at its sole cost
and expense, the following types and
amounts of
Insurance:
12
Insurance Type
Amount of Coverage
Risks Covered
Commercial General $1,000,000 per
occurrence and bodily injury,
property
Liability
$2,000,000 in the aggregate damage and
contractual
liability
Property Damage full
replacement value of the "all risk",
including
Building and all improvements sprinkler
damage and flood insurance
located on the Premises
Business Interruption not less than 12
installments of loss of earnings by at
Fixed Monthly Rent
least the perils of fire
and lighting extended
coverage, vandalism,
malicious mischief
and sprinkler
leakage
Worker's compensation as required by
law
5.2 POLICY FORM.
5.2.1 Tenant shall
obtain all policies of insurance
required
by Section 5.1 from
insurance companies reasonably
acceptable to
Landlord which are qualified to do business in
the jurisdiction where the Premises
are situated and
which
have
an "A-" or higher
claims paying rating as ascribed by
Standard &
Poor's rating service. All such policies shall be
issued,
in the names of Landlord and Tenant, and, if
requested
by Landlord, any mortgagee or beneficiary of
Landlord,
as additional insureds. In
addition, all such
policies
providing coverage for physical damage shall
include
loss payee and
mortgagee endorsement
in favor of
Landlord
and
Landlord's
mortgagee
or beneficiary,
respectively and
as applicable. Tenant shall cause copies of
such
policies
of insurance or originally executed
certificates
thereof to be
delivered to Landlord
prior to
Landlord's
execution of this Lease, and not less than thirty
(30) days prior
to any renewal thereof. As often as any such
policy
shall expire or
terminate, Tenant shall procure and
maintain
renewal or additional policies with
like terms.
None
of such policies shall contain any co-insurance
requirements and
all such policies shall provide for written
notice
to Landlord and any mortgagee or beneficiary of
Landlord
not less than thirty (30) days prior to any
modification,
cancellation,
lapse, or reduction in the
amounts
of insurance, and shall further
provide that
any
loss
otherwise
payable
thereunder
shall be payable
notwithstanding
any act or negligence of Landlord or Tenant
which
might, absent such
provision, result in a
forfeiture
of all or part of the payment of such loss.
All general
liability,
property damage, and other casualty policies
shall be written
on an occurrence basis as primary policies,
not contributing with or in excess of coverage which
Landlord may
carry.
5.2.2 Tenant's
obligations to carry the insurance
provided for
above may be brought within the coverage of an
"umbrella"
policy or policies of insurance carried and
maintained by
Tenant; provided, however, that such policy or
policies
shall (i) have limits
of not less than $5,000,000,
(ii)
name Landlord and any mortgagee or beneficiary of
Landlord
as additional insureds as their interests may
appear,
(iii) provide that the coverage afforded
Landlord
will not
13
be reduced or diminished by reason of
the use of such
blanket
policies; and (iv) otherwise comply with the
provisions
of this Article V. Tenant agrees to permit
Landlord at all
reasonable times to inspect any policies of
insurance
of Tenant which Tenant has not delivered to
Landlord.
Tenant also shall comply with all insurance
requirements
of the Easement Agreement
( as defined in
Section
13.6).
5.3
SUBROGATION-WAIVER. Landlord (for itself and its
insurer)
hereby waives any rights, including rights of
subrogation, and
Tenant (for itself and its insurer) hereby
waives any
rights, including rights of subrogation, each may
have
against the other on account of any
loss or damage
occasioned
to Landlord or Tenant,
as the case may
be, to
their respective
property, the Premises or its contents that
are caused by or
result from risks insured against under any
insurance
policies carried by the parties
hereto and in
force
at the time of any
such damage. The foregoing waivers
of subrogation shall be operative
only so long as available
in the jurisdiction where the Premises
are located and so
long as no
policy of insurance is invalidated thereby.
5.4 PAYMENT
OF INSURANCE. In the
event that
Tenant
shall
fail
to obtain the insurance policies required
hereunder
