EXHIBIT 10.79.1
FIRST AMENDMENT TO INDUSTRIAL LEASE
THIS FIRST AMENDMENT TO INDUSTRIAL LEASE (this "First Amendment") is
entered into as of the 23rd day of January, 1997 by and between ERI-CP, INC.,
a Delaware corporation (successor-in-interest to Carol Point Builders I
General Partnership, a California general partnership) ("Landlord") and
UNITED STATIONERS SUPPLY CO., an Illinois corporation (successor-in-interest
to Associated Stationers, Inc. ["Original Tenant"]) ("Tenant").
R E C I T A L S:
WHEREAS, Landlord's predecessor-in-interest and Original Tenant
entered into that certain Industrial Lease undated (said Industrial Lease is
hereinafter referred to as the "Lease") for certain premises containing
approximately 139,444 rentable square feet located at 898 Carol Court, Carol
Stream, Illinois (the "Demised Premises").
WHEREAS, Original Tenant subsequently was merged with and into
Tenant and in connection therewith, Tenant assumed all of the obligations and
rights of tenant in the Lease.
WHEREAS, Landlord and Tenant desire to amend the Lease to extend the
term (the "Term") of the Lease and to otherwise amend the Lease as provided
below.
NOW, THEREFORE, for and in consideration of the recitals hereinabove
set forth and for other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant hereby
agree as follows:
1. INCORPORATION OF RECITALS AND TERMS. The foregoing recitals are
hereby incorporated in and made a part of this First Amendment. Unless
otherwise defined in this First Amendment to the contrary, all capitalized
terms used herein shall have the respective meanings as are ascribed to the
terms in the Lease.
2. MERGER AND ASSIGNMENT. Tenant has informed Landlord that Original
Tenant merged into and with Tenant (the "Merger") effective as of March 30,
1995. Tenant represents and warrants to Landlord that pursuant to such
Merger, Tenant has heretofore assumed all obligations and liabilities of
Original Tenant thereunder effective as of said date.
3. EXTENSION OF TERM. Landlord and Tenant hereby agree to extend the
Term of the Lease for an additional five (5) year period, commencing on June
1, 1997 and ending on May 31, 2002 (sometimes herein referred to as the
"Extended Term").
4. FIXED RENT. Effective as of June 1, 1997, Fixed Rent payable
under the Lease during the Term of the Lease shall be as follows:
Monthly Installment
Period Annual Fixed Rent of Fixed Rent
------ ----------------- -------------
June 1, 1997 - May 31, 1999 $594,031.44 $49,502.62
June 1, 1999 - May 31, 2002 634,470.24 52,872.52
5. CONDITION OF THE DEMISED PREMISES. Landlord shall not be required
to provide any alterations or modifications to the Demised Premises. Tenant
is currently in possession of the Demised Premises and accepts the Demised
Premises in its "As-Is" condition.
Tenant at Tenant's expense, (subject to the application of the
"Tenant Allowance" [as such term is defined in the form of Work Letter attached
hereto as Exhibit A]) may install a washroom, a conference room and perform
certain other work in the Demised Premises all as shall be more particularly
set forth in the Working Plans (as defined in the Work Letter) as Tenant's
Work (as defined in the Work Letter). Tenant shall not undertake any
construction nor shall Tenant install any equipment, trade fixtures or
personal property without first executing and delivering to Landlord a
counterpart copy of the Work Letter and thereafter obtaining Landlord's
written approval of the Working Plans, which Working Plans shall be submitted
to Landlord in a timely fashion in accordance with the provisions of
Paragraph 3 of the Work Letter. Thereafter no material changes will be made
in the Working Plans without the prior written consent of Landlord. Tenant
shall not commence any work until among other things, Tenant delivers to
Landlord the insurance and any bond required under the terms of the Work
Letter.
6. ADDITIONAL AMENDMENTS TO LEASE.
(a) Article A-l(n) and (o) of the Lease are hereby deleted in
their entirety and the following substituted therefor:
"(n) Landlord's Address:
ERI-CP, INC.
c/o LaSalle Advisors Limited
200 East Randolph
Chicago, Illinois 60601
(o) Tenant's Address:
United Stationers Supply Co.
2200 East Golf Road
Des Plaines, Illinois 60016
Attention: President"
(b) The following words are added after the word, "instance", at
the end of the first sentence of Article N-l of the Lease:
"which consent shall not be unreasonably withheld or delayed."
(c) As a condition to and in consideration of Landlord's covenants
hereunder, Tenant expressly agrees that Paragraph 4 of Rider No. One to the
Lease is hereby deleted in its entirety; it being the express intent of the
parties that Tenant shall have no further rights to extend the Term of the
Lease following the expiration of the Extended Term.
(d) The "Right of First Notification" provision appearing at the
end of Rider No. One of the Lease is hereby deleted in its entirety and the
following substituted therefor:
"RIGHT OF FIRST OFFER. If at any time during the Extended Term, that
certain space contiguous to the Demised Premises depicted on Exhibit B
hereto and containing approximately 135,508 square feet (the "Option
Space") becomes available for leasing, and if no Event of Default by
Tenant exists under the Lease, then Landlord shall not lease such
Option Space to any third party without first giving Tenant (i) notice
of the availability of such space which shall include the proposed
term and rental rate (including escalations, if any), abatements and
allowances, if any, and other economic concessions that Landlord would
agree to with respect to such Option Space (the "Offered Terms"), and
(ii) three (3) business days after the date of such notice in which to
commit in writing to lease such Option Space on the Offered Terms for
the remainder of Term, taking into account any modifications in such
Offered Terms required by the fact that the remaining Term may be
longer or shorter than that proposed by Landlord, and otherwise on the
terms, covenants and conditions contained in the Lease. Landlord and
Tenant expressly agree that the Offered Terms, in any event, shall
limit Landlord's liability for the payment of a brokerage commission
to any Tenant's broker to the payment of the then-current market
expansion commission (i.e., a commission equal to 50% of the then
market commission payable to outside brokers in connection with new
leases of space in the Building).
If Tenant fails, refuses or is otherwise unable to commit to such a
lease within the three (3) business day period, Landlord shall have
the right to lease the Option Space to any third party or parties on
such terms as are acceptable to Landlord."
7. BROKERS. Tenant represents and warrants to Landlord that
neither it nor its officers or agents nor anyone acting on its behalf has
dealt with any real estate broker, other than LaSalle Partners and Grubb &
Ellis (the fees of which shall be payable by Landlord) in the negotiation or
making of this First Amendment and Tenant agrees to indemnify and hold
harmless Landlord from any and all claims, liability, costs and expenses
(including attorneys' fees) incurred as a result of any inaccuracy in the
foregoing representation and warranty.
8. FULL FORCE AND EFFECT: INCONSISTENCY. Except as otherwise
expressly set forth in this First Amendment, all provisions of the Lease
shall remain in full force and effect. In the event of any inconsistency
between the terms of the Lease and the terms of this First Amendment, the
terms of this First Amendment shall control.
IN WITNESS WHEREOF, the parties have executed this First Amendment as of
the day and year first above written.
LANDLORD:
ERI-CP, INC., a Delaware corporation
By: LaSalle Advisors Limited,
its duly authorized agent
By:
Name: K. C. Woodrow
Title: Managing Director
TENANT:
UNITED STATIONERS SUPPLY CO.,
an Illinois corporation
By:
Name: Daniel H. Bushell
Title: Executive Vice President and
Chief Financial Officer
EXHIBIT A
UNITED STATIONERS SUPPLY CO.
WORK LETTER
1. DEFINITIONS. Terms which are defined in the Lease shall have the
same meanings when used in this Work Letter. In addition, the following terms
shall have the following meanings:
(a) "Space Plans" means plans, drawings, and specifications showing
the intended design, character, and finishes of the Tenant's Work in the
Demised Premises, including partition and door locations and storefront
signs.
(b) "Systems Plans" means drawings, plans and specifications for
the mechanical, sprinkler, heating, air conditioning, electrical and plumbing
systems to be installed by Tenant's contractors in the Demised Premises.
(c) "Tenant Improvement Plans" means the Space Plans and the
Working Plans.
(d) "Tenant's Work" means the work described in Paragraph 4 below.
(e) "Working Plans" means the final working plans and
specifications prepared by or for Tenant (including, without limitation, the
Systems Plans) for the work to be performed by Tenant in the Demised
Premises, which Working Plans shall contain sufficient detail and shall be
otherwise suitable in all respects for submission to the building department
of the Village of Carol Stream to obtain a building permit. Working Plans
shall be consistent with the Space Plans approved by Landlord.
(f) "Tenant's Contractors" means any contractor hired by Tenant and
any subcontractor hired by such contractor.
2 INTENTIONALLY OMITTED.
3. PREPARATION AND APPROVAL OF TENANT IMPROVEMENT PLANS.
(a) Tenant hereby agrees to cause to be prepared by a registered
architect or a space planner, and submitted to Landlord for Landlord's review
and approval, the (i) Space Plans, and (ii) the Working Plans.
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(b) Within fifteen (15) business days after Landlord has received
the Space Plans and within twenty (20) business days after Landlord has
received the Working Plans, Landlord shall notify Tenant of Landlord's
approval or disapproval thereof, and in the event of disapproval, Landlord
shall specify the reasons for such disapproval. Tenant shall cause the Space
Plans or the Working Plans, as the case may be, to be revised and resubmitted
to Landlord for Landlord's review and approval within five (5) days after
Landlord notifies Tenant of disapproval thereof.
(c) Neither review nor approval by Landlord of the Space Plans or the
Working Plans shall constitute a representation or warranty by Landlord that any
of such plans either (i) are complete or suitable for their intended purpose, or
(ii) comply with applicable laws, ordinances, codes and regulations, it being
expressly agreed by Tenant that Landlord assumes no responsibility or liability
whatsoever to Tenant or to any other person or entity for such completeness,
suitability, or compliance.
(d) Once approved by Landlord, Tenant shall not make any material
changes, modifications or additions to the Tenant Improvement Plans without
the prior written consent of Landlord.
4. TENANT'S WORK.
(a) Tenant, at its sole cost and expense (but subject to the
application of the Tenant Allowance described in Paragraph 9 below) shall
perform all work in accordance with the Tenant Improvement Plans approved by
Landlord.
(b) All Tenant's Work shall be performed by contractors and
suppliers as are reasonably approved, in advance, in writing, by Landlord.
(c) Tenant hereby agrees to deliver to Landlord, within three (3)
days following the execution of the general contract for the Tenant's Work, a
true correct and complete copy of such general contract together with a total
project budget outlining the aggregate cost of all Tenant's Work to be performed
in the Demised Premises, all fees payable to Tenant's contractor for overhead,
general conditions and profit and all other hard and soft costs associated with
preparing the Demised Premises for Tenant's occupation thereof (other than
Tenant's furniture installation, phone installation and equipment installation)
(all of such costs are herein collectively referred to as "Tenant's Project
Cost").
5. PROCEDURE AND SCHEDULES FOR THE CONSTRUCTION OF TENANT'S WORK.
(a) General Requirements.
At least five (5) days prior to the commencement of Tenant's
Work hereunder, Tenant shall submit to Landlord the following:
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(i) All required building and other permits.
(ii) A construction schedule setting forth, in detail, the
construction sequence of the various trades, furnishing and move-in activities,
which shall set forth, among other things, the estimated date of completion of
Tenant's Work.
(iii) Evidence that appropriate public utility companies have
been notified as necessary to provide service for construction and occupancy
purposes.
(iv) Tenant's general contractor's sworn statement in form
satisfactory to Landlord identifying by trade the names, addresses and
telephone numbers of each subcontractor and supplier.
(v) In addition to the foregoing, Tenant shall not permit
Tenant's Contractors to commence any work until Tenant has received evidence
of the following insurance covering Tenant's Contractors' performance of the
work:
(1) Workers' Compensation Insurance in compliance with law
and Employer's Liability Insurance in the minimum amount of Five
Hundred Thousand Dollars ($500,000.00) and as required under any
applicable employee benefit act or statute, as will protect Tenant's
Contractors from any and all liability under such acts.
(2) Commercial General Liability Insurance including
premises/operations liability, independent contractors' liability,
products and completed operations liability (to be maintained in
effect for two (2) years following completion and acceptance of such
contract work), contractual liability and broad form property damage
liability in a minimum amount of One Million Dollars ($1,000,000) per
occurrence, combined single limit of bodily injury, personal injury or
property damage with annual aggregate of One Million Dollars
($1,000,000) for all such occurrences.
(3) Commercial Automobile Liability Insurance covering the
ownership, operation, maintenance, use, loading and unloading of any
owned, non-owned and hired automobile in the amount of One Million
Dollars ($1,000,000) per occurrence of bodily injury or property
damage.
(4) Umbrella Liability Insurance providing limits in excess
of those limits indicated in 5.(a)(v)(1), (2) and (3) (except Worker's
Compensation Insurance) in the amount of Five Million Dollars
($5,000,000) per occurrence, combined single limit for bodily injury,
personal injury and property damage.
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(5) Builder's Risk Insurance, written on a completed value
form, insuring against risks of direct physical loss or damage
excluding only standard perils, covering Tenant's Work and all other
improvements to the Demised Premises and all furniture, trade
fixtures, equipment, merchandise and all other items of Tenant's
property in the Demised Premises, in an amount not less than the
actual replacement cost of the work, and shall not include a co-
insurance provision of less than one hundred percent (100%).
Tenant shall furnish the insurance to be provided by Tenant under
Article F of the Lease prior to the commencement of Tenant's Work, and shall
furnish to Landlord certificates evidencing the coverages required by this
Paragraph, which certificates shall state that such insurance coverage may not
be changed or canceled without at least thirty (30) days' prior written notice
to Landlord and shall name as additional named insured parties (i) Landlord,
(ii) the holder of each mortgage encumbering the Demised Premises of which
Landlord shall have notified Tenant, and (iii) such other persons as Landlord
may from time to time designate. All insurance shall otherwise be in form and
substance satisfactory to Landlord.
(b) COMMENCEMENT OF CONSTRUCTION. Tenant shall commence construction
of Tenant's Work promptly following the approval of the Working Plans and
Tenant's receipt of Landlord's written notice to proceed with such work.
6. REQUIREMENTS DURING PERFORMANCE OF TENANT'S WORK. Tenant shall fully
perform and comply with each of the following covenants, conditions and
requirements:
(a) Tenant and Tenant's agents, contractors, workmen, mechanics,
suppliers and invitees shall work in harmony and not interfere with Landlord and
Landlord's contractors in doing work for other tenants and occupants of the
Building.
(b) Tenant shall require all entities performing work on behalf of
Tenant to provide protection for existing improvements to an extent that is
reasonably satisfactory to Landlord and shall allow Landlord or its agent access
to the Demised Premises, for inspection purposes, at all times during the period
when Tenant is undertaking construction activities thereon. In the event any
entity performing work on behalf of Tenant causes any damage to the property of
Landlord or others, Tenant shall cause such damage to be repaired at Tenant's
expense and if Tenant fails to cause such damage to be repaired promptly upon
Landlord's demand therefor, Landlord, in addition to any other rights or
remedies available to Landlord under the Lease or at law or equity, may cause
such damage to be repaired, in which event Tenant, upon Landlord's demand, shall
promptly pay to Landlord the cost of such repairs.
(c) All contractors and subcontractors shall use only those entrances
designated by Landlord for ingress and egress of personnel and the delivery and
removal of equipment and material through or across any common areas shall only
be permitted with the written approval of Landlord and during hours determined
by Landlord. Construction equipment
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and materials are to be located in confined areas approved by Landlord and truck
traffic is to be routed to and from the Building as directed by Landlord so as
not to burden the operation of the Building. Landlord shall have the right to
order any contractor or subcontractor who violates the above requirements to
cease work and to immediately remove it, its equipment, and its employees from
the Buildings.
(d) Tenant shall be responsible for providing trash removal service.
Tenant shall cause each entity employed by it to perform work on the Demised
Premises to abide by the provisions of this Work Letter as to the storage of
trash and shall cause Tenant's general contractor to leave the Demised Premises
in a clean and safe condition at the end of each day. Should Landlord deem it
necessary to remove Tenant's trash because of accumulation, an additional charge
to Tenant will be on a time and material basis.
(e) Tenant agrees that all services and work performed on the Demised
Premises by, on behalf of, or for the account of Tenant, shall be done in a
first-class workmanlike manner using only good grades of material and shall be
performed only by bondable licensed contractors, covered by a collective
bargaining agreement with the appropriate trade union.
(f) Tenant agrees to protect, indemnify, defend and hold Landlord
harmless from and against any and all losses, damages, liabilities, claims,
liens, costs, and expenses, including reasonable attorney's fees of whatever
nature, including those to the person and property of Tenant, its employees,
agents, invitees, licensees and others arising out of or in connection with the
performance of Tenant's Work by Tenant or Tenant's contractors in or about the
Demised Premises, the Building, and the cost of any repairs to the Demised
Premises, necessitated by activities of Tenant or Tenant's Contractors.
(g) Following any material default by Tenant hereunder, Landlord
shall have the right (but not the obligation) to perform on behalf of and for
the account of Tenant, subject to reimbursement by Tenant, any of Tenant's Work
which Landlord determines shall be so performed, provided that Landlord notifies
Tenant at the time Landlord approves the Tenant Improvement Plans of any such
work to be performed by Landlord. The cost to Landlord of any Tenant's Work
performed or supplied to Tenant by Landlord shall become due and payable within
five (5) business days after Tenant has been invoiced for same by Landlord.
8. COMPLETION DELIVERIES. Within five (5) business days after the
substantial completion of the Tenant's Work, Tenant shall deliver to Landlord
the following (collectively, the "Closing Deliveries"):
(a) An Architect's Certificate, in form and substance satisfactory to
Landlord, certifying that the Tenant's Work is in place and has been performed
in accordance with the approved Working Plans;
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(b) A detailed breakdown, in a form and substance satisfactory to
Landlord, of the final and total costs of Tenant's Work prepared by Tenant
and its Contractor(s), together with receipted invoices showing payment
thereof; subject to any punch list matters;
(c) Original waivers of lien and contractor's affidavits in such form
as may be required by Landlord, from all parties performing labor or supplying
materials in connection with Tenant's Work and sworn statements and long form
affidavits and waivers from Tenant's architect, engineer and contractors and any
other party with whom Tenant contracted directly for labor or materials
furnished Tenant in or for the Demised Premises;
(d) Copies of all warranties for workmanship, materials and equipment
received by Tenant from manufacturers and/or installers in connection with
Tenant's Work;
(e) "As-built" drawings of all improvements, certified by the
appropriate architect or engineer, and information regarding any special
requirements for cleaning the improvements completed on behalf of Tenant;
(f) Information with regard to any special security systems installed
by Tenant;
(g) An Estoppel Certificate in the form and substance reasonably
satisfactory to the parties;
(h) Such other supporting documentation as Landlord may reasonably
require.
9. TENANT ALLOWANCE. (a) Provided that Tenant has obtained Landlord's
approval of the Tenant Improvement Plans as provided above and has completed
Tenant's Work prior to July 1, 1997 ("Tenant's Work Completion Date"), Tenant
shall be entitled to an allowance (the "Tenant Allowance") to be applied
toward Tenant's costs incurred in the performance of the Tenant's Work in an
amount up to $20,000.00.
(b) Landlord shall disburse the Tenant Allowance to Tenant within
thirty (30) days of Landlord's receipt of all of the Closing Deliveries
described in Paragraph 8 above. Notwithstanding the foregoing, Landlord shall
reimburse Tenant out of the Tenant Allowance for costs incurred by Tenant for
the preparation of the Tenant Improvement Plans within thirty (30) days
following Landlord's receipt from Tenant of paid invoices evidencing to
Landlord's reasonable satisfaction such costs.
(c) Notwithstanding anything contained herein to the contrary,
provided that the "hard costs" of Tenant's Work shall not be less than
$10,000.00, if Tenant does not timely use the entire amount of the Tenant
Allowance for the purposes stated above, then any excess thereof (not to exceed
$10,000.00) shall be applied and credited to Fixed Rent first becoming due after
Tenant's Work Completion Date.
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10. MISCELLANEOUS.
(a) Tenant hereby appoints Otis H. Halleen as Tenant's representative
in connection with the matters set forth in this Work Letter and such person has
and shall have full authority and responsibility to act on behalf of Tenant and
to make all decisions and determinations as may be necessary or desirable in
connection with preparing the Demised Premises for the operation of Tenant's
business therein. Tenant shall inform Landlord in writing of any change in
Tenant's representative.
(b) Tenant's obligation to pay Fixed Rent and Additional Rent with
respect to the Demised Premises during the Extended Term shall commence on
June 1, 1997 irrespective of the status of completion of the Tenant's Work.
(c) This Work Letter shall not be deemed applicable to any additional
space added to the original Demised Premises at any time or from time to time or
to any portion of the original Demised Premises or any additions thereto in the
event of a renewal or extension of the initial term of the Lease unless
expressly so provided in the Lease or any amendment or supplement thereto signed
by both Landlord and Tenant.
(d) The failure by Tenant to pay any monies due Landlord pursuant to
this Work Letter within the time period herein stated shall deemed an Event of
Default under the terms of the Lease for which Landlord shall be entitled to
exercise all remedies available to Landlord for nonpayment of rent. All late
payments shall be subject to a service charge pursuant to Articles Q-16 and Q-17
of the Lease.
(e) This Work Letter is expressly made a part of the Lease and is
subject to each and every term and condition thereof, including, without
limitation, the limitations on liability set forth therein.
(f) Tenant shall be solely responsible to determine at the site all
dimensions of the Demised Premises and the Building in which the Demised
Premises are located which affect any work to be performed by Tenant hereunder.
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IN WITNESS WHEREOF, the parties have executed this Work Letter as of the
23rd day of January, 1997.
LANDLORD:
ERI-CP, INC., a Delaware corporation
By: LaSalle Advisors Limited,
its duly authorized agent
By:
Name: K. C. Woodrow
Title: Managing Director
TENANT:
UNITED STATIONERS SUPPLY CO.,
an Illinois corporation
By:
Name: Executive Vice President and
Title: Chief Financial Officer
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