This instrument was
prepared by
AEI Income & Growth Fund
25 LLC
Attn: Jenn Schreiner
1300 Wells Fargo Place
30 Seventh Street East
St. Paul, MN 55101
Phone: 800-328-3519
(Space Above This Line For Recorder's Use Only)
ASSIGNMENT AND ASSUMPTION OF LEASE
THIS ASSIGNMENT AND ASSUMPTION OF LEASE (this
"Assignment") made this 25 day of October, 2005, (the
"Effective Date") by and between CDK ASSOCIATES LLC, a South
Dakota limited liability company ("Assignor"), having an
address of 115 South Main Avenue, Sioux Falls, South Dakota,
57109, and AEI INCOME AND GROWTH FUND 25 LLC, a Delaware
corporation ("Assignee"), having an address of 1300 Wells
Fargo Place, 30 Seventh Street East, St. Paul, Minnesota
55101.
W I T N E S S E T H:
WHEREAS, Assignor is the owner of certain real property
located at 2908 Broadway Avenue, City of Yankton, Yankton
County, South Dakota (the "Property") as further described on
Exhibit A attached hereto and made a part hereof;
WHEREAS, Assignor, as landlord, has leased the Property
to Tractor Supply Company, a Delaware corporation ("Tractor
Supply Company"), as lessee, pursuant to that certain Lease
Agreement dated May 27, 2003 (hereinafter referred to as, the
"Lease"); and
WHEREAS, Assignor desires to assign its right, title and
interest in and to the Lease to Assignee, and Assignee desires
to accept the assignment thereof and assume Assignor's right,
title and interest in and to the Lease;
NOW, THEREFORE, in consideration of the mutual agreements
hereinafter set forth, and other good and valuable
consideration, the receipt and sufficiency of which are
acknowledged by each of the parties hereto, Assignor and
Assignee do hereby agree as follows:
1. ASSIGNMENT. 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 and
(ii) any and all rents prepaid as of the Effective Date, held
by Assignor in connection with the Lease (the "Rent").
2. ACCEPTANCE OF ASSIGNMENT AND ASSUMPTION. Assignee
hereby accepts the foregoing assignment, and hereby assumes
and agrees to be bound by and perform all of Assignor's
obligations and liabilities to be performed and/or occurring
under the Lease on or after the Effective Date, including,
without limitation, the obligations for return of security
deposits as provided in the Lease and/or required by law, and
any and all obligations for any and all leasing commissions,
brokerage fees and similar payments which become due and
payable after the Effective Date, including, without
limitation, any and all leasing commissions, brokerage fees
and similar payments which become due and payable in
connection with the exercise of any option or right under the
Lease.
3. INDEMNIFICATION. (a) Assignor hereby indemnifies
Assignee, and agrees to defend and hold harmless Assignee from
and against any and all liability, loss, damage and expense,
including without limitation reasonable attorneys' fees, which
Assignee may or shall incur under the Lease by reason of any
failure or alleged failure of Assignor to have complied with
or to have performed, before the Effective Date, the
obligations of the landlord thereunder which were to be
performed before the Effective Date.
(b) Assignee hereby indemnifies Assignor, and
agrees to defend and hold harmless Assignor from and against
any and all liability, loss, damage and expense, including
without limitation reasonable attorneys' fees, which Assignor
may or shall incur under the Lease by reason of any failure or
alleged failure of Assignee to comply with or perform, on or
after the Effective Date, all the obligations of the landlord
thereunder which are to be performed on or after the Effective
Date.
4. SUCCESSORS AND ASSIGNS. The terms and conditions of this
Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective successors and
assigns.
5. RETAINED RIGHTS. Assignee hereby agrees that Assignor
may, at Assignor's election and expense, proceed at law or
equity to collect any delinquent rents accruing under the
Lease prior to the Effective Date. Assignor hereby agrees
that Assignee shall have no obligation to collect any rent due
prior to the Effective Date under the Lease; provided,
however, that in the event Assignee is paid rent from a tenant
that has delinquent rent accruing prior to the Effective Date,
and such payment is in excess of current rent due and payable
under the Lease and any collection costs incurred by Assignee
to collect such rents, then Assignee agrees to pay such excess
amount to Assignor as soon as reasonably practicable after the
date of receipt by Assignee. In the event that Assignor is
paid any rents after the Effective Date, Assignor agrees to
pay such to Assignee as soon as reasonably practicable after
the date of receipt by Assignor.
6. COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, and
all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be duly executed on the day and year first set
forth above.
ASSIGNOR: CDK ASSOCIATES LLC,
a South Dakota limited liability
company
By: /s/ Lester A Kinstad
Name: Lester A Kinstad
Title: Managing Member
STATE OF So Dak )
) ss.
COUNTY OF Minnehaha )
The foregoing was acknowledged before me this 25 day of
October, 2005, by Lester A Kinstad, the Sole Member of CDK
Associate LLC, a South Dakota limited liability company, for
himself and for CDK Associates LLC.
IN WITNESS WHEREOF, I have hereunto set my hand and
affixed my official seal in the County and State of aforesaid,
the day and year last above-written.
[notary seal] /s/ Sharon L Lusk
Notary Public
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SIGNATURES TO FOLLOW ON NEXT PAGE]
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
Name: Robert P Johnson
Title: President
STATE OF MINNESOTA )
) ss.
COUNTY OF RAMSEY )
The foregoing was acknowledged before me this 25 day of
October 2005, by Robert P. Johnson, in his capacity as the
President of AEI Fund Management XXI, Inc., a Minnesota
corporation, the managing member of AEI Income & Growth Fund
25 LLC, a Delaware limited liability company, who acknowledged
the execution of the foregoing instrument to be the voluntary
act and deed of said company by authority of its board of
directors on behalf of the company.
IN TESTIMOMNY WHEREOF, I have hereunto set my hand and
affixed my official seal in the County and State aforesaid,
the day and year first above written.
[notary seal] /s/ Jennifer L Schreiner
Notary Public
EXHIBIT A
Legal Description
Real property in County of Yankton, State of South Dakota,
described as follows:
Lots 4 and 9, Block 2, Airport Acres Addition, excluding the
West Half (W 1/2) of vacated Piper Street lying immediately East
of said Lot 4 as vacated by Resolution of Board of County
Commissioners, dated June 4, 1958, all in the City and County
of Yankton, South Dakota as per plat recorded in Book S3,
pages 63-63A.
LEASE
THIS LEASE made as of the 27th day of May, 2003, by and between
CDK Associates, LLC, (the "Landlord") and TRACTOR SUPPLY COMPANY,
a Delaware corporation (the "Tenant").
I. PREMISES.
(a) LEASED PREMISES. Landlord for and in consideration
of the covenants contained in this Lease and made on the
part of Tenant, does hereby lease unto Tenant and Tenant
does hereby lease from Landlord the real property described
in EXHIBIT A attached hereto, and the improvements now or
hereafter located thereon (the "Premises"), situated in
Yankton, South Dakota, to have and to hold the same, for the
term and on the conditions hereinafter provided.
(b) CONSTRUCTION OF IMPROVEMENTS. Prior to commencement
of the Term of this Lease, as described in Section 2 below,
Landlord agrees to complete the design, engineering and
construction of a building (the "Building") on the Premises
in accordance with the construction requirements described
in EXHIBIT E attached hereto.
2. TERM
(a) LEASE COMMENCEMENT. Tenant shill have and hold the
Premises for an initial term of fifteen (15) years
commencing on the Lease Commencement Date, as set forth in
EXHIBIT E attached hereto (the "Lease Commencement Date")
and ending on December 31, 2018. The "Term" shall mean the
original term of this Lease, plus any extensions pursuant to
the terms of this Lease. A "Lease Year" shall mean each
twelve (12) month period of the Term commencing on the Lease
Commencement Date and every anniversary thereof
(b) EARLY OCCUPANCY Notwithstanding the foregoing,
Tenant may occupy the Premises prior to the Lease
Commencement Date for purposes of completing fixturing and
other work to be completed by Tenant in readying the store
for opening.
3. OPTION TO EXTEND TERM. Tenant shall have the right to
extend the Term for three (3) successive periods of five (5)
years each on the terms and conditions contained in this Lease,
upon written notice in writing to Landlord given at least ninety
(90) days prior to the expiration of the initial Term or any
extended Term.
4. ANNUAL RENT/FIXED.
(a) RENT COMMENCEMENT. Tenant's liability for rent
shall commence as described in EXHIBIT E subject to the
terms and conditions of this Lease. Tenant, in consideration
of the covenants made by Landlord, covenants and agrees to
pay to Landlord as
rent for the Premises during the Term, and any extension thereof,
the annual basic rent as set forth on EXHIBIT C, attached hereto
and made a part hereof (collectively, the "Annual Rent"), in
payable in advance in equal monthly installments on the first
(1st), day of every calendar month (each, a "Due Date"), as set
forth on EXHIBIT C. If the Lease Commencement Date is a day
other than the first day of a calendar month, the first rental
payment and the last rental payment shall be the pro-rata portion
of such rent for days contained in such fractional month. Rent
shall be paid to Landlord at the address set forth on EXHIBIT C,
or at such other address as Landlord may designate by written
notice to Tenant.
(b) MONTHLY INSTALLMENTS. All monthly installments of Annual
Rent shall be paid on or before the Due Date in United States
Dollars, without prior demand or offset except as specifically
permitted under this Lease. Any monthly installment of Annual
Rent made more than fifteen (15) days after the Due Date shall
bear interest at the rate of one and one-half percent (1.5%) per
annum until paid.
5. NET LEASE. In addition to the Annual Rent. Tenant shall
be responsible for payment of real estate taxes, insurance
premiums and utilities related to the Premises in order to make
the Annual Rent payable to Landlord, net of all customary
expenses of operating the Premises, as follows:
(a) REAL ESTATE TAX. During the entire term of this Lease
and any renewals thereof, Tenant shall also be responsible for
the payment of all real estate property taxes ("Property Taxes")
assessed against the land and the Building to be constructed
which comprise the Premises. Landlord shall furnish Tenant with a
copy of each tax statement, and within ten (10) days after the
receipt of same, Tenant shall deposit with Landlord the full
amount of such Property Taxes as shown on such statement for
payment by Landlord.
(b) INSURANCE. Tenant shall procure and keep in effect
during the Term public liability and property damage insurance
with a combined single limit coverage of $2,000,000.00 for each
occurrence. Tenant shall also procure and keep in effect during
the Term fire and extended coverage for the Building, written on
an All-Risk Endorsement and Replacement Cost basis. Each such
policy referred to above shall name Landlord and Landlord's
mortgagee as additional insureds as their interest may appear
..All such policies shall be issued by entities with an A.M. Best
Rating of A-VII or higher. Tenant shall deliver certificates of
insurance evidencing such coverage within ten (10) days of the
Commencement Date, or the date of any renewal of this Lease, and
not less than three (3) days prior to the expiration of any such
policy.
(c) ASSESSMENTS. Tenant shall pay, as they become due and
payable, all assessments and other charges or governmental
impositions levied upon or assessed against the Premises
including but not limited to, assessments for sewer or water,
within ten (10) days after Landlord has furnished Tenant with a
copy of the statement for the same; provided, however, that
Tenant may. in its own name, dispute and contest the same, and in
such case, disputed items shall be paid under protest until
finally adjudicated to be valid. At the conclusion of any such
contest Landlord shall reimburse Tenant 100% of any reduction and
Tenant shall pay Landlord 100% of any increase. All court costs
interest and penalties relating to any such dispute shall be paid
by Tenant.
If any assessment is payable in installments or separate parts
over a period of two (2) or more years, only the part which
becomes due in a particular year shall be payable according to
the provisions of this Lease agreement.
(d) UTILITIES. Landlord, at Landlord's expense, shall cause
all utilities serving the Premises to be separately metered.
Tenant agrees to pay all charges made against the Premises for
electricity, gas, heat, water, and all other utilities as and
when due during the term of this Lease and any renewals thereof.
Tenant shall make arrangements for all utilities serving the
Premises to bill Tenant directly for monthly usage charges during
the Term of this Lease. Tenant shall maintain, the temperature of
the Building on the Premises at a temperature sufficient to
prevent damage to the water system caused by freezing. Tenant
shall pay all utility bills and statements promptly to insure
that no liens attached to the Premises due to lack of payment of
same Landlord has the right to declare this Lease in default in
the event a lien is filed against the Premises. Landlord may pay
ally unpaid utility charges at its option and, in such event.
Tenant shall reimburse Landlord for any such payments.
6. QUIET POSSESSION.
(a) POSSESSION. Landlord represents, warrants and guarantees
to Tenant quiet and undisturbed possession of the Premises for
the Term, and further represents and warrants to Tenant that
Landlord has full right and lawful authority to enter into this
Lease, and is lawfully seized of the Premises free and clear of
all tenancies, liens and encumbrances superior in rights to this
Lease, except for real estate taxes not yet due and payable, and
the exceptions described on EXHIBIT D attached hereto which have
been approved by Tenant (collectively the "Permitted
Exceptions"). Landlord represents and warrants that the Permitted
Exceptions do not prohibit or adversely affect in any way the
Tenant's Intended Use (as hereinafter defined) or the other
provisions of this Lease.
(b) APPLICABLE LAW. The Premises are subject to applicable
statutes, ordinances and regulations which Landlord represents
and warrants do not prohibit or adversely affect the Intended Use
of the Premises, including, without, out limitation, the Outdoor
Display Areas contemplated by Section 7, hereof. Tenant agrees
the the Premises shall not be used as a wholesale club or store,
discount store, drug store, pharmacy, gasoline station or other
business selling gasoline, a convenience store or a grocery
store.
(c) LANDLORD INDEMNIFICATION Landlord warrants and agrees to
defend the title to the Premises, and will indemnify, hold
harmless and defend Tenant against any damage and expense which
Tenant may suffer by reason of any defect in the title or
description of the Premises. If, at any time, Landlord's title
or right to receive rent under this Lease is disrupted, or there
is a change of ownership of Landlord's estate by act of the
parties, operation of law or otherwise, Tenant may withhold rent
thereafter accruing until Tenant is furnished proof satisfactory
to it as to the party properly entitled to the rent.
(d) CERTIFICATE OF OCCUPANCY. Landlord represents and
warrants that a certificate of occupancy or its equivalent,
permitting occupancy of the Premises for Tenant's
Intended Use shall, be issued by the appropriate governmental
authority having jurisdiction over the Premises, and that the
Premises and the Intended Use shall, when completed, comply and
conform to the requirements of all governmental authorities
applicable to the Premises, including, without limitation,
planning and zoning rules and regulations, and building, health
and fire codes. Landlord acknowledges that Tenant's obligation to
pay rent hereunder is contingent upon issuance of an acceptable
certificate of occupancy, or its equivalent (and compliance with
the other requirements of Exhibit E) as set forth in Exhibit E.
(e) SUBORDINATION; ATTORNMENT; NONDISTURBANCE. At the option
of any first mortgagee of the Premises, this Lease shall be
subordinate at all times to the lien of such mortgage or deed of
trust existing or that may hereafter be placed upon the Premises,
and to any and all advances made thereunder, provided that such
subordination shall not become effective unless and until the
proposed mortgagee or beneficiary shall have executed and
delivered to Tenant the Subordination, Non-Disturbance and
Attornment Agreement attached hereto as EXHIBIT G (hereinafter
referred to as the "Nondisturbance Agreement").
Landlord shall obtain and furnish to Tenant a Nondisturbance
Agreement from any present mortgagee of any mortgage or
beneficiary of any deed of trust superior to this Lease on or
before the date this Lease is fully executed. In the event
Landlord has not furnished Tenant with an executed Nondisiurbance
Agreement from such mortgagee or beneficiary within sixty (60)
days from the date of this Lease, Tenant shall have the right to
terminate this Lease and immediately receive from Landlord any
and all prepaid rents, deposits and other sums paid by Tenant on
account of this Lease.
(f) ADA COMPLIANCE. Landlord covenants and agrees that at
its own expense, and without any right of reimbursement from
Tenant, it shall complete construction to the Building and effect
such improvements, alterations, repairs, additions or
replacements to the Premises, and take such other actions as
shall be necessary to cause the Premises, to fully and timely
comply with the requirements of all governmental authorities
applicable to the Premises, including, without limitation,
planning and zoning rules and regulations, building, health and
fire codes, the " American with Disabilities Act" of 1990 as
amended and the Federal regulations promulgated thereunder (the
"Disabilities Act"); provided, however, that, with respect to the
Disabilities Act, the parties agree as follows:
(i) Each party shall have responsibility under the
Disabilities Act for its own standards, criteria, policies,
practices, and procedures.
(ii) Tenant shall have the responsibility for the provision
of "' auxiliary aids and services" (as such term is used in the
Disabilities Act) to its customers, if and to the extent required
in connection with its operation of its business on the Premises.
(iii) Except as provided in subsection (iv) below, Landlord
shall have responsibility for the removal of barriers, where such
removal is required by the Disabilities Act.
(iv) Tenant shall have the responsibility for the
removal of barriers, if any, created by its trade fixtures and
leasehold improvements made by Tenant, where such removal is
required by the Disabilities Act.
(v) Where barrier removal is not required by the
Disabilities Act, but the use of alternative methods of
providing access is required, Landlord shall have
responsibility for the use of such methods except to the
extent that the Disabilities Act required alternative
methods that involve services by Tenant's employees for the
retrieval or delivery of Tenant's inventory.
(vi) Where alterations made by either party trigger
'path of travel' requirements under the Disabilities Act,
responsibility for satisfying such requirements shall rest
on: the party making such alterations,
7 USE OF THE PREMISES. Tenant shall use the Premises
primarily for the sale of farm, home and auto supplies, and any
incidental-or accessory uses relating thereto, including the
display of merchandise in the Outdoor Display Areas and on the
sidewalks in front of the Building (the "Intended Use"). In
addition, Tenant shall have the right to use the Premises for any
other lawful purpose provided the written consent of Landlord
shall have been obtained, which consent shall not be unreasonably
withheld or delayed. Tenant shall not permit or suffer the use of
the Premises for any unlawful purpose. Landlord specifically
acknowledges that Tenant may erect racking and other display
facilities in the Outdoor Display Areas reflected in EXHIBIT A
Tenant shall also have the right to enclose the Outdoor Display
Areas with fencing. In addition, to the Outdoor Display Areas,
Tenant may display seasonal merchandise in the areas designated
on the Site Plan attached as EXHIBIT A.
8. RESERVED
9. Eminent Domain.
(a) TAKING As used herein, the term "Taking" shall mean
any taking of all or any part of the Premises or of the
Center in which the Premises are located or any access
thereto by right of eminent domain, by a deed in lieu
thereof, or otherwise. Landlord shall give Tenant prompt
notice of any pending or threatened Taking and shall provide
Tenant with copies of all notices or other information
related to any negotiations, communications. or government
actions related to a threatened Taking.
(b) TERMINATION BY TENANT. If, during the Term, there
is a Taking and the remaining portion of the Premises, if
any, is in Tenant's judgment unsuitable for the Intended
Use, Tenant may by written notice to Landlord terminate this
Lease as of the date title vests pursuant to such Taking and
all rent and other charges due under this Lease shall be
apportioned to such date.
In addition, if as a result of a Taking (i) there is any
material change in access from the Center to Broadway, or (ii)
the parking ratio for the Center is reduced below three (3)
parking spaces per 1, 000 square feet of gross leasable area, or
(iii) twenty percent (20%) or more
of the Common Areas shall be taken, or (iv) the repairs to the
portion of the Premises subject to the Taking cannot, in Tenant's
reasonable judgment, be repaired within a reasonable timeframe to
avoid disruption of Tenant's business, then, and in any of such
events, Tenant may terminate this Lease by written notice to
Landlord and all rent and other charges due under this Lease
shall be apportioned to the date title vests pursuant to such
Taking.
(c) RESTORATION. If this Lease is not terminated as
hereinabove provided then:
(i) Landlord shall at its sole expense promptly repair and
rebuild the part of the Premises that is not subject to the
Taking to a condition satisfactory, in Tenant's judgment, for the
Intended Use.
(ii) Between the date of Taking and thirty (30) days
following the completion of repairing and rebuilding the
Premises, all rent and other charges payable to Tenant to
Landlord hereunder shall be equitably abated to the extent that
the Premises are not, in Tenant's judgment, suitable for the
conduct of Tenant's Intended Use.
(iii) Upon the completion of such repairs and rebuilding,
and thereafter throughout the balance of the Term, rent and other
charges due Landlord hereunder shall be reduced in that
proportion which the number of square feet of area of the
Premises taken bears to the total number of square feet of area
of the Premises existing immediately prior to such Taking.
(iv) Notwithstanding the foregoing, nothing in this Lease
shall prohibit Tenant from receiving compensation from the
condemning authority for Tenant's interest in the Premises, trade
fixtures installed by Tenant in the Premises, or for Tenant's
moving expenses.
10. MAINTENANCE AND REPAIR.
(a) HVAC AND BUILDING SYSTEMS. Landlord represents and
warrants to Tenant that, as of the commencement of the Term, the
heating ventilating, and air conditioning (collectively the "HV
AC"), the plumbing, mechanical, electrical and roof systems in or
serving the Premises are new, have been tested and are in
complete working order, meet the specifications for the Premises,
and are acceptable for Tenant's Intended Use and in conformity
with all requirements of applicable governmental authorities.
Landlord shall assign to Tenant all of the Warranties related to
the HVAC, the roof, and other building systems, as contemplated
by subsection (e) below.
(b) TENANT OBLIGATIONS. Tenant shall, at its expense,
maintain in good \ condition and repair the interior of the
Premises and the doors and windows, except for any repairs
thereto that are necessitated by the willful or negligent acts of
Landlord or its agents, independent contractors, vendors,
suppliers, servants, other tenants, or employees, which i
Landlord shall perform at its expense.
(d) RIGHT TO CORRECT. If Tenant fails to perform its
replacement, repair or maintenance obligations hereunder, then
the Landlord, after thirty (30) days written notice to the
defaulting party or upon such shorter notice as may be reasonable
(i) in the event of an emergency or (ii) in the event such
replacement, repair or maintenance is necessary in order to avoid
damage to Tenant's merchandise or interference with Tenant's
business, may perform the same at the cost of the defaulting
party; provided, however, other than in the case of an event or
events described in clause (i) or (ii), above, of this
subsection, if such default cannot be cured within thirty (30)
days despite diligent efforts and such defaulting party commences
to cure within such thirty (30) day period, and thereafter
pursues such cure diligently to completion, then the cure period
shall be extended for such additional period as shall be
necessary to complete such cure, but not to exceed sixty (60)
days.
If the Tenant fails to reimburse Landlord for the cost of
replacements, repairs or maintenance so performed by Landlord
within thirty (30) days after Tenant receives from Landlord a
statement setting forth such cost, then the cost to Landlord of
performing the same shall be deemed additional Rent.
If the defaulting party is Landlord and Landlord fails to
reimburse Tenant for the cost of replacements, repairs or
maintenance so performed by Tenant within thirty (30) days after
Landlord receives a statement setting forth such cost, then
Tenant may offset the cost to Tenant of performing the same
against the rent and other charges due from Tenant under this
Lease.
(e) ASSIGNMENT OF WARRANTIES. All third-party warranties
related to the HV AC, the roof, and other building systems, shall
be assigned to Tenant upon completion of the Improvements and
acceptance of the Improvements by Tenant, as provided for in
EXHIBIT E.
11. ALTERATIONS AND IMPROVEMENTS:
(a) ALTERATIONS OR IMPROVEMENTS BY TENANT. Tenant may, at
its expense, make any nonstructural alterations or improvements
to the Premises which it may deem desirable, but it shall make
them in a good and workmanlike manner and in accordance with all
applicable governmental requirements. The Landlord, without
expense to itself, shall cooperate with
Tenant in securing building permits or other authorizations
necessary from time to time for any such work by Tenant.
In addition, Tenant may also make structural alterations or
improvements to the Premises with Landlord's prior written
consent, which consent shall not be unreasonably withheld or
delayed. If Landlord falls to consent or object in writing to any
alterations or improvements proposed by Tenant to Landlord within
fifteen (15) days after Tenant so requests, Landlord shall be
deemed to have consented to such structural alterations or
improvements. If any mechanics' or materialmen's liens are filed
arising from any work by Tenant with respect to the Premises,
Tenant shall satisfy or otherwise remove such liens of record
from the Premises within sixty (60) days of notification thereof
by Landlord. (If Tenant disputes the claim, in good faith, Tenant
shall have the right to contest the same in 8: court of competent
jurisdiction, provided Tenant deposits a reasonable escrow fund
with Landlord or otherwise has the lien bonded during such
proceedings).
(b) LANDLORD'S WORK. Landlord's Work is described in full in
Exhibit E
(c) END OF TERM. Upon the termination of this Lease, the
Tenant shall, at its option (i) remove any trade fixtures,
equipment, alterations, and improvements installed by it on the
Premises and repair any damage caused by such removal. at its
expense or (ii) leave all such alterations and improvements on
the Premises (except for its moveable trade fixtures, furniture
and equipment), in which event all such alterations and
improvements shall become the property of Landlord.
12. DAMAGE OR DESTRUCTION BY FIRE OR OTHER CASUALTY.
(a) DESTRUCTION: RIGHTS OF PARTIES. If the Premises
(including all improvements and alterations thereon, whether made
by Landlord or Tenant) shall be damaged or destroyed by fire, the
elements, unavoidable accident or other casualty, whether in
whole or in part, the Landlord, at its sole cost and expense
shall, within six (6) months from the date such damage or
destruction occurs (the "Expected Completion Date") promptly and
with due diligence repair and rebuild the Premises to the
condition existing just prior to such damage or destruction. If
Landlord determines in good faith that the Premises cannot be so
repaired and rebuilt by the Expected Completion Date, Landlord,
shall within five (5) days from the date of such damage or
destruction, give written notice to Tenant of the date when the
Premises will be completely repaired and rebuilt (the "Revised
Expected Completion Date"), whereupon, Tenant shall have the
option either (i) to terminate this Lease by written notice to
Landlord within ten (10) days thereafter and this Lease shall be
deemed to have terminated as of the date of such damage or
destruction; or (ii) to permit Landlord to completely repair and
rebuild the Premises by the Revised Expected Completion Date.
Notwithstanding anything contained in this section, Tenant
shall have the further right to terminate this Lease by written
notice to Landlord within ten (10) days from the occurrence of
anyone of the following events: (i) Landlord does not commence
repairing and rebuilding the Premises within fourteen (14) days
from (a) the date of damage or destruction
(where the Premises are to be repaired and rebuilt by the
Expected Completion Date), or (b) the date Landlord notifies
Tenant of the Revised Expected Completion Date, as the case may
be; or (ii) Landlord does not diligently repair and rebuild the
Premises in good and workmanlike manner; or (iii) Landlord does
not completely repair and rebuild the Premises by the Expected
Completion Date, or the Revised Expected Completion Date, as the
case may be.
Any election by Tenant to terminate this Lease pursuant to the
provisions of this section shall be without waiver of any other
rights or remedies available to Tenant under this Lease, at law
or in equity.
(b) RENT ABATEMENT From the date such damage or destruction
occurs to the Premises to the date when al] repairs and
rebuilding are complete and Tenant commences reusing, the
Premises for the Intended Use, the rent and all other charges due
under this Lease shall be reduced by the same percentage of the
Premises which, in Tenant's judgment, cannot be economically or
practically used for the Intended Use.
13. WAIVEROF SUBROGATION/INDEMNIFICATION.
(a) SUBROGATION. Landlord and Tenant agree that with respect
to any property loss which is covered by insurance then being
carried or required to be carried by them hereunder7 the one
suffering such loss and carrying or required to carry such
insurance releases the other of and from any and all claims,
defense costs and expenses with respect to such loss. Landlord
and Tenant further agree that each of their insurance policies
(insuring the improvements, in the case of Landlord, and Tenant's
personal property, in the case of Tenant) shall provide for an
appropriate waiver of subrogation reflecting this release. Each
party shall, within fifteen ( 15) days after request by the other
party 7 deliver to such other party a certificate of insurance
and a receipt of insurance and a receipt evidencing that the
insurance required by this Lease is paid in full and in full
force and effect. No insurance required by this Lease shall be
cancelable except after thirty (30) days notice to Tenant and
Landlord, All insurance required by this Lease may be carried
under blanket policies maintained by the party required to
maintain such insurance or may be carried under a combination of
primary insurance and umbrella coverage. All insurance policies
required by this Lease shall be written by solvent and
responsible insurance companies authorized to do business in the
state in which the Premises' are located which are well rated by
national rating organizations.
(b) INDEMNIFICATION. Landlord agrees to indemnify and hold
Tenant harmless from and against any and all claims, liabilities,
damages, causes of action, costs and expenses, including
reasonable attorneys' fees, for personal injury, death, property
damage, and other losses occurring in or as the result of
Landlord's operation of any common area, or arising out of any
failure of the Landlord to perform any of its obligations under
the Lease, or resulting from the acts or omissions of Landlord,
its agents, employees or contractors, excluding, however, damages
arising solely out of the negligence of the Tenant or Tenant's
employees, agents or
contractors.
Tenant agrees to indemnify and hold Landlord harmless from
and against any and all claims, liabilities, damages, causes of
action, costs and expenses, including reasonable
attorneys' fees, for personal injury, death, property damage, or
other losses occurring in the i Premises, or arising out of any
failure of the Tenant to perform any of its obligations under the
i Lease, or resulting from the acts or omissions of the Tenant,
its agents, employees or contractors, excluding, however, damage
arising sole out of the negligence of the Landlord, or Landlord's
employees, agents or contractors. ,
14. TENANT'S PROPERTY AND FIXTURES. Landlord hereby waives
any right to distraint and any Landlord's lien or similar lien on
all personal property in or on the Premises, including Tenant's
moveable trade fixtures, furniture, inventory and equipment,
whether owned by Tenant or any other person, and the same shall
be and remain the personal Property of Tenant, exempt from the
claims of Landlord or any mortgagee or lienholder of Landlord
without regard to the means by which the same are installed or
attached. Tenant may at. any time during the continuance of its
tenancy or upon vacating the Premises, remove all such personal
property, including Tenant's moveable trade fixtures furniture
and equipment, which Tenant owns or may have installed or placed
at its own expense on the Premises or which it furnished and
Landlord installed. If such removal damages any part of the
Premises the Tenant shall repair such damage.
15. ASSIGNMENT/SUBLETTING
(a) TRANSFER. As used herein, a "Transfer" shall mean the
assignment of this Lease or the Transfer or the subletting of all
or any part of the Premises by Tenant. Except as provided in
subsection (b) below, Tenant may not effect or cause a Transfer
without Landlord's written consent, which consent shall not be
unreasonably withheld, conditioned or delayed.
(b ) PERMITTED TRANSFERS. Notwithstanding anything to the
contrary contained in this Lease, with the Landlord's prior
consent, Tenant may:
(i) Transfer the Premises or any portion thereof to any
"affiliate company". An "affiliate company" shall mean, for
purposes of this subsection, any corporation, partnership or
other business entity under common control and ownership
with the Tenant, or with the parent or any subsidiary of the
Tenant or Tenant's parent.
(ii) Merge into or consolidate with any corporation.
(iii) Transfer the Premises, or any portion thereof, to
any buyer of all or substantially all of the business
operations of Tenant, provided that, as of the
effective date of the Transfer, provided, however, such
buyer shall be subject to all of the terms and
conditions of this Lease.
(iv) Transfer the Premises to any franchisee or
licensee of the Tenant, provided however, such transferee
shall be subject to all of the terms and conditions of this
Lease
(v) Effectuate a Transfer in connection with the sale
or transfer of all or any portion of the outstanding stock
of Tenant.
Tenant agrees to give Landlord written notice within thirty (30)
days of any Transfer described in (c) (i) through (v) above.
16. TAXES
(a) PERSONAL PROPERTY TAXES. Tenant shall pay when due taxes
levied upon the personal property owned or leased by Tenant and
kept on the Premises.
(b) TAX CONTESTS. Landlord and Tenant may in good faith
contest any such taxes if the contesting party protects the other
parties interest in the Premises by means reasonably satisfactory
to, the party not contesting such taxes.
17. DEFAULT.
(a) TENANT DEFAULT. If Tenant shall default in the payment
of rent to be paid by Tenant under this Lease or in the
compliance with any provision of this Lease and such default of
Tenant shall continue uncured for fifteen (15) days in the case
of a monetary default or thirty (30) days in the case of a non-
monetary default after written notice thereof from the Landlord,
then the Landlord, by giving written notice to Tenant, may either
(i) terminate this Lease, or (ii) re-enter the Premises by
summary proceedings, in either event, removing Tenant . and
removing all property from the Premises and re-renting the
Premises at the best possible rent obtainable, and receive the
rent therefrom and apply such rent to the Annual Rent and other
charges due under this Lease; provided, however, Tenant shall
remain liable for the amount of all rent for the entire term of
this Lease less the monies actually collected from such re-
renting which Landlord shall apply to rent and other charges due
under this Lease, if any. Notwithstanding the foregoing, in the
case of a non-monetary default, if such non-monetary default is
not reasonably capable of being cured within the original thirty
(30) day period, then the period for curing such default shall be
extended for so long as Tenant is proceeding with reasonable
diligence to cure such default.
If a petition in bankruptcy shall be filed by Tenant, or
Tenant shall be adjudicated a bankrupt, ot Tenant shall make a
general assignment for the benefit of creditors, or if due to any
proceeding based upon the insolvency of Tenant, a receiver of all
of the property of Tenant shall be appointed and shall not be
discharged within sixty (60) days after such appointment, then
Landlord may terminate this Lease by giving written notice to
Tenant of its intention to do so. Landlord shall use reasonable
efforts to mitigate its damages upon a default by Tenant under
this Lease.
(b) LANDLORD DEFAULT. If Landlord defaults in the compliance
with any provision of this Lease and such default of Landlord
continues uncured for thirty (30) days after written notice from
Tenant to Landlord, then, in addition to all other rights and
remedies provided by law and in equity, Tenant shall have the
right to cure such default and offset the cost of such cure
against the rent and other charges due under this Lease.
..Notwithstanding the foregoing, if such default is not reasonably
capable of being cured within thirty (30) days, then the period
for curing such default shall be extended for so long as Landlord
is proceeding with
reasonable diligence to cure such default. If any such default by
Landlord continues uncured for sixty (60) days after written
notice from Tenant, then, in addition to its other rights, Tenant
shall have the right to terminate this Lease by written notice to
Landlord. Nothing contained in the foregoing provisions of this
subsection shall limit Tenant's right to cure any default by
Landlord of its replacement, repair or maintenance obligations or
the time limit prescribed pursuant to the terms of this Lease
within which such cure call be effected.
18. TENANT'S EXCLUSIVE USE/NON-DISTURBANCE. Landlord
covenants that it will not (except as to the Premises) construct,
lease or occupy, or permit to be constructed, leased or occupied,
a farm, ranch or feed retail store on any real property
(collectively, the "Property") which Landlord (or any affiliate
or partner of Landlord, or any entity in which Landlord possesses
an interest) intends to develop within a ten (10) mile radius of
the Premises. The covenants and restrictions contained in this
section are for the benefit of the Premises shall run with the
Property and inure to and pass with the Premises, and shall be
binding upon any and all successive owners of the Property herein
restricted. Landlord covenants that in the event Landlord shall
hereafter sell the Property or any portion thereof, or any
interest therein, it will impose or cause to be imposed in the
documents of transfer a restriction preventing and prohibiting
the grantee or any future owner from using the Property so sold
in violation of the foregoing covenants and restrictions. At the
request of Tenant, Landlord shall record an" instrument or
instruments setting forth the covenants contained in this Section
18. Landlord covenants that in the event of a breach of the
foregoing covenants and restrictions, it will use its best
efforts to enforce such provisions. Notwithstanding the preceding
sentence, in the event a violation of any of the covenants and
restrictions set forth in this section continues for more than
one-hundred eighty (180) days, Tenant, in addition to any other
rights or remedies under law it may have as a result of such
violation; shall have the option to terminate this Lease upon
written notice to Landlord w.hereupon this Lease and the tenancy
created hereunder shall cease.
19. SURRENDER OF PREMISES. At the expiration of the Term,
Tenant shall leave and surr6nder the Premises in good order and
condition, excepting reasonable wear and tear, repairs and
replacements required to be made by the Landlord and any loss or
damage by fire, the elements, casualty and as otherwise provided
herein.
20. HOLDOVER. Any holding over after the expiration of the
Term shall create a month-to-month tenancy at the Annual Rent
specified in this Lease {pro-rated on a monthly basis), and shall
otherwise be on the same terms and conditions as specified in
this Lease as far as applicable.
21. SATELLITE COMMUNICATIONS DISC AND EQUIPMENT. Landlord
agrees that during the term of this Lease, Tenant shall have the
right to install a satellite communications disc and related
equipment" Tenant shall do so at its own cost and expense and in
accordance with all applicable laws, rules and regulations.
Additionally, Tenant shall defend. indemnify and hold Landlord
harmless from and against any claims, costs or expenses incurred
by Landlord as a result of such installation by Tenant. If Tenant
shall install such equipment, Tenant shall be responsible for the
maintenance and repair thereof, at Tenant's sole cost. At the
expiration or other termination of the Lease, said equipment
shall remain the property of Tenant, and may be
removed by Tenant, provided that Tenant shall repair any and all
damage caused by such removal.
22. SIGNS Tenant shall have the right to install, maintain
and replace on the Premises Tenant's standard signs and logos,
including the installation of a pylon sign, the general
specifications for which are set forth in Exhibit F attached
hereto. Landlord warrants that the Permitted Exceptions do not
prohibit Tenant's standard signs and logos. Tenant shall obtain
any and all applicable permits from the locality in which the
Premises are located for the installation, maintenance and
replacement of such signs and logos. No rooftop sign will be
permitted. Tenant may install its standard pylon sign in the
location shown on Exhibit A attached hereto.
23. ENVIRONMENTAL
(a) LANDLORD REPRESENTATIONS. Landlord warrants, represents
and covenants that there are no "Regulated Substances" (as
defined herein) in. on or released or being released from under
the land, including, but not limited to, the Premises, and that
the Premises will remain in that condition during the Term of
this Lease, except to the extent Tenant stores, sells or uses
such substances in its normal course of business. "Regulated
Substances" shall include "hazardous waste", "hazardous
substances", "asbestos or asbestos containing materials",
"regulated substances", "petroleum", "polychlorinated.
biphenyls", and other substances or chemicals regulated pursuant
to the Comprehensive Environmental Response, Compensation, and
Liability Act, 42 U.S.C. 9601-9675, the Solid Waste Disposal Act,
42 U.S.C. 6901- 6991i, the Toxic Substances Control Act, 15
U.S.C. 2601-2692, and the regulations promulgated under those
federal statutes, and the analogous and other state environmental
laws and regulations. Landlord specifically represents that there
are no asbestos or asbestos containing materials in the Premises.
Landlord shall comply with all governmental requirements,
including, without limitation, financial responsibility/assurance
requirements, relating to any underground storage tanks located
in, on or under the Premises.
(b) LANDLORD INDEMNIFICATION. Landlord agrees to indemnify,
hold harmless and defend Tenant from any and all claims, damages,
fines, judgments, penalties, costs, liabilities or loss
(including, without limitation, any and all sums paid for
settlement of claims, attorneys' fees, consultant and expert
fees) arising during or after the Term from or in connection with
any inaccuracy in or breach of any covenant, warranty,
representation, or obligation of Landlord set forth in this
section.
(c) TENANT INDEMNIFICATION. Tenant shall not cause or permit
any Regulated Substances to be used, stored, generated, or
disposed of, on, in. or about the Premises, except in the
ordinary course of Tenant's business and in compliance with
applicable law. Nothing in this section shall be construed to
hold Landlord responsible for the activities of Tenant or for
Regulated Substances introduced into or onto the Premises by
Tenant, and Tenant agrees to indemnify, hold harmless and defend
Landlord from any and all claims, damages, fines, judgments,
penalties, costs, liabilities or loss (including, without
limitation, any sums paid for settlement of claims, attorneys'
fees, consultant and expert fees) arising during or after the
Term and directly caused by Tenant's introduction of Regulated
Substances into or onto the Premises.
24. MEMORANDUM. Landlord agrees that at any time on request
of the Tenant, it will execute a memorandum of lease (a
"Memorandum of Lease)'), and Tenant shall be permitted to record
the Memorandum of Lease, in the appropriate land records of the
jurisdiction in which the Premises is located, at Tenant's option
and expense.
25. NOTICES. Notices to Landlord and Tenant shall be sent by
(a) first class mail postage prepaid, registered or certified
mail) return receipt requested, (b) hand delivery) or (c)
overnight mail service) addressed as follows:
If to Landlord: CDK Associates LLC
300 North Dakota, Suite 609
Sioux Falls South Dakota
Attn: Les Kinstad, Managing Member
If to Tenant: Tractor Supply Company
320 Plus Park Blvd.
Nashville Tennessee 37217
Attn: Real Estate Department
Copy to: Sherrard & Roe, PLC
424 Church Street, Suite 2000
Nashville, TN 37219
Attn: Kim A Brown. Esq.
Notices shall be deemed received (a) upon hand delivery (b) the
next business day if overnight mail service is used or ( c) when
the return receipt is signed by the recipient. or its if the
return receipt is not signed or delivery refused, three (3)
business days after the sender has so deposited such notice in a
U.S. post office or any branch thereof Either party may designate
a substitute address from time to time, by notice sent in writing
in accordance with the provisions of this section.
26. WAIVER .The parties agree the failure of either party to
insist upon strict observance of any of the terms or conditions
of this Lease at any time shall not be deemed a waiver of such
party's right to insist upon strict observance thereafter.
27. ENTIRE AGREEMENTT/SEVERABILITY This is the entire
agreement and understanding between the parties written or oral
with respect to the transaction contemplated by this Lease, and
supersedes any prior negotiations or understandings between the
parties. If any term, covenant or condition of this Lease or the
application thereof shall, to any extent, be held invalid or
unenforceable, the remainder of this Lease or the application
thereof other than those to which it is held invalid or
unenforceable shall not be affected thereby and in each term this
Lease shall be valid and enforced to the fullest extent permitted
by law.
28. CAPTIONS AND SECTION NUMBERS. The captions and section
numbers appearing in this Lease are inserted only as a matter of
convenience and in no way define the scope or intent of such
sections of this Lease or in any way affect this Lease.
29. MODIFICATION. This Lease may not be modified in any
manner except by an instrument in writing executed by the parties
hereto or their respective successors in interest.
30. APPLICABLE LAW. This Lease shall be construed under the
law of the state in which the Premises are located.
31. DISPUTE RESOLUTION.
(a) MANDATORY ARBITRATION. The parties shall promptly submit
any dispute, claim, or controversy arising our of or relating to
this Lease or any alleged breach, to binding arbitration before
three arbitrators (each an " Arbitrator"; collectively, the "
Arbitrators"). The parties agree that, except. as 9therwise
provided herein respecting temporary or preliminary injunctive
relief, binding arbitration shall be the sole means of resolving
any dispute, claim, or controversy arising out of or relating to
this Agreement or any alleged breach.
(b) ARBITRATOR'S QUALIFICATIONS AND SELECTION. Each
Arbitrator shall be an active member of the Bar in the
jurisdiction in which the arbitration is brought, specializing in
real estate law. The party initiating arbitration (the
"Claimant") shall appoint its Arbitrator in its demand (the
"Demand"). The other party (the "Respondent") shall appoint its
Arbitrator within 20 Business Days of receipt of the Demand and
shall notify the Claimant of such appointment in writing. If the
Respondent fails to appoint an Arbitrator within such period of
20 Business Days, the Arbitrator named in the Demand shall decide
the controversy as a sole Arbitrator. Otherwise, the two
Arbitrators appointed by the parties shall appoint a third
Arbitrator within 20 Business Days after the Respondent has
notified the Claimant of the appointment of the Respondent's
Arbitrator. When the Arbitrators appointed by the Claimant and
the Respondent have appointed a. third Arbitrator and the third
Arbitrator has accepted the appointment, the two Arbitrators
shall promptly notify the parties of the appointment of the
Arbitrator.
(c) GOVERNING LAW: WRITTEN DECISION. In any arbitration
hereunder, this Agreement and any Transaction Document shall be
governed by the laws of the state in which the Premises are
located, without regard to conflicts of law principles thereof,
which laws the Arbitrators shall apply in rendering a decision.
The Arbitrators shall issue a written decision, setting forth
finding of fact and conclusions of law, within 60 days after the
Arbitrators .shall have been selected. The Arbitrators shall have
no authority to award punitive or other exemplary damages.
(d) PROCEDURES: EVIDENCE: EXPERTS.
(i) Any arbitration instituted hereunder shall be held
in Nashville, Tennessee, in accordance with and under then
current provisions of the rules of the American Arbitration
Association, except as otherwise provided herein.
(ii) On application to the Arbitrators, any party shall
have rights to discovery to the same extent as would be provided
under the rules of the American Arbitrations Association;
provided, however, that the Arbitrators shall limit any discovery
or evidence of such that a decision shall be rendered within the
period referred to in Section 31.
(e) COSTS The costs of the Arbitration proceeding and
any proceeding in court to confirm or to vacate any arbitration
award or to obtain temp0orary or preliminary injunctive relief as
provided herein (including, without limitation, actual attorney's
fees and costs shall be borne by the unsuccessful party and shall
be awarded as part of the Arbitrator's decision, unless the
Arbitrators shall otherwise allocate such costs, for the reasons
set forth in such decision.
(f) CONSENT TO JURISDICTION Any judgment upon any
award rendered by the Arbitrators may be entered in and enforced
by any court of competent jurisdiction. The parties expressly
consent to the jurisdiction of the courts in the jurisdiction in
which the arbitration is brought to enforce any award of the
Arbitrators or to render any provisional or injunctive relief in
connection with or in aid of the Arbitration. The parties
expressly consent to the personal and subject matter jurisdiction
of the Arbitrators to arbitrate any and all matters to be
submitted to arbitration hereunder.
(g) INJUNCTIVE RELIEF This Section 31 shall not prevent
any party from seeking or obtaining temporary or preliminary
injunctive relief in a court for any breach or threatened breach
of any provision of this Agreement; provided that the
determination whether such breach or threatened breach shall have
occurred and the remedy therefore (other than with respect to
such preliminary or temporary relief) shall be made by
arbitration pursuant to this Section 31.
(h) SURVIVAL This arbitration clause shall survive the
termination of this Agreement.
32. WAIVER OF JURY TRIAL EXEM0PLARY DAMAGES All parties
hereby waive their rights to trial by jury with respect to any
dispute arising under this Agreement. Nor party shall e awarded
punitive or other exemplary damages respecting any dispute
arising under this agreement.
33. ATTORNEYS' FEES The unsuccessful party to any court or
other proceeding arising out of this Agreement that is not
resolved by arbitration under Section 31 shall pay to the
prevailing party all reasonable attorneys' fees and costs
actually incurred by the prevailing party, in addition to any
other relief to which it may be entitled.
34. NO PARTNERSHIP ETC This Agreement shall not be
construed as creating a joint venture, partnership, agency,
employment relationship or ther enterprise between the parties.
IN WITNESS WHEREOF, this agreement has been duly
executed as of the day and year first above written.
LANDLORD:
CDK ASSOCIATES, LLC
ATTEST:
By: /s/Lester Kinstad
Title: Managing Member
TENANT:
TRACTOR SUPPLY COMPANY,
a Delaware Corporation
By: Stephen Hull
Title: Vice President
STATE OF South Dakota
County of Minnehaha to wit
The foregoing instrument was acknowledged before me
this 17th day of May 2003, by Les Kinstad, as Managing Member of
CDK Associates, LLC a limited liability company on behalf of the
limited liability company.
My commission expires 7/15/03
/s/ Georgia Pusch
Notary Public
STATE OF TENNESSEE
COUNTY OF DAVIDSON, to wit
The foregoing instrument was acknowledged before me
this 14 day of May, 2003 by Stephen E Hull as Vice President of
TRACTOR SUPPLY COMPANY, a Delaware corporation on behalf of the
corporation.
My commission expires May 28, 2003
/s/ Karen G Bass
Notary Public