Michael E. Gabor ISBA # 13151
LEASE - BUSINESS PROPERTY - SHORT FORM
THIS AGREEMENT, made and entered into this _______ day of May, 2003, by
and between Kossuth County Agricultural Association (a/k/a Kossuth County Fair
Board) ("Landlord"), whose address, for the purpose of this lease, is Kossuth
County Courthouse, 114 West State Street, Algona, IA 50511, and Hydrogen Engine
Center, Inc. ("Tenant"), whose address for the purpose of this lease is 700 East
Fair Street, Algona, IA 50511.
The parties agree as follows:
1. PREMISES AND TERM. Landlord leases to Tenant the following real
estate, situated in Kossuth County, Iowa:
The property commonly known as the "Old Armory" at 700 East Fair
Street, Algona, Iowa, and more particularly described on Exhibit A
attached hereto and by this reference made a part hereof.
together with all improvements thereon, and all rights, easements and
appurtenances thereto belonging, for a term beginning on the 1st day of June,
2003, and ending on the 30th day of May, 2006, upon the condition that Tenant
performs as provided in this lease.
2. RENT. Tenant agrees to pay Landlord as rent $ 600.00 per month, in
advance commencing on the 1st day of June, 2004, and on the 01 day of each month
thereafter, during the term of this lease. Rent for any partial month shall be
prorated as additional rent. Tenant shall also pay: all utilities and insurance.
All sums shall be paid at the address of Landlord, or at such other
place as Landlord may designate in writing. Delinquent payments shall draw
interest at 7 % per annum.
3. POSSESSION. Tenant shall be entitled to possession on the first day
of the lease term, and shall yield possession to Landlord at the termination of
this lease. SHOULD LANDLORD BE UNABLE TO GIVE POSSESSION ON SAID DATE, TENANT'S
ONLY DAMAGES SHALL BE A PRO RATA ABATEMENT OF RENT.
4. USE. Tenant shall use the premises only for hydrogen engine
research, production and manufacturing.
5. CARE AND MAINTENANCE.
(a) Tenant takes the premises as is, except as herein provided.
(b) Landlord shall keep the following in good repair: roof, exterior
walls, foundation, sewer, plumbing, heating, wiring, air conditioning, plate
glass, windows and window glass, parking area, driveways, sidewalks, exterior
decorating, interior decorating, Landlord shall not be liable for failure to
make any repairs or replacements unless Landlord fails to do so within a
reasonable time after written notice from Tenant.
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(c) Tenant shall maintain the premises in a reasonable safe,
serviceable, clean and presentable condition, and except for the repairs and
replacements provided to be made by Landlord in subparagraph (b) above, shall
make all repairs, replacements and improvements to the premises, INCLUDING ALL
CHANGES, ALTERATIONS OR ADDITIONS ORDERED BY ANY LAWFULLY CONSTITUTED GOVERNMENT
AUTHORITY DIRECTLY RELATED TO TENANT'S USE OF THE PREMISES. Tenant shall make no
structural changes or alterations without the prior written consent of Landlord.
Unless otherwise provided, and if the premises include the ground floor, Tenant
agrees to remove all snow and ice and other obstructions from the sidewalk on or
abutting the premises.
6. UTILITIES AND SERVICES. Tenant shall pay for all utilities and
services which may be used on the premises. Landlord shall not be liable for
damages for failure to perform as herein provided, or for any stoppage for
needed repairs or for improvements or arising from causes beyond the control of
Landlord, provided Landlord uses reasonable diligence to resume such services.
7. SURRENDER. Upon the termination of this lease, Tenant will surrender
the premises to Landlord in good and clean condition, except for ordinary wear
and tear or damage without fault or liability of Tenant. Continued possession,
beyond the term of this Lease and the acceptance of rent by Landlord shall
constitute a month-to-month extension of this lease.
8. ASSIGNMENT AND SUBLETTING. No assignment or subletting, either
voluntary or by operation of law, shall be effective without the prior written
consent of Landlord, which consent shall not unreasonably be withheld.
9. INSURANCE.
A. PROPERTY INSURANCE. Landlord and Tenant agree to insure their
respective real and personal property for the full insurable value. Such
insurance shall cover losses included in the Insurance Services Office Broad
Form Causes of Loss (formerly fire and Landlord and extended coverage). To the
extent permitted by their policies the Landlord and Tenant waive all rights of
recovery against each other.
B. LIABILITY INSURANCE. Tenant shall obtain commercial general
liability insurance in the amounts of $1,000,000.00 each occurrence and
$1,000,000.00 annual aggregate per location. This policy shall be endorsed to
include the Landlord as an additional insured.
10. LIABILITY FOR DAMAGE. Each party shall be liable to the other for
all damage to the property of the other negligently, recklessly or intentionally
caused by that party (or their agents, employees or invitees), except to the
extent the loss is insured and subrogation is waived under the owner's policy.
11. INDEMNITY Except for any negligence of Landlord, Tenant will
protect, defend, and indemnify Landlord from and against any and all loss,
costs, damage and expenses occasioned by, or arising out of, any accident or
other occurrence causing or inflicting injury or damage to any person or
property, happening or done in, upon or about the premises, or due directly or
indirectly to the tenancy, use or occupancy thereof, or any part thereof by
Tenant or any person claiming through or under Tenant.
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12. DAMAGE. In the event of damage to the premises, so that Tenant is
unable to conduct business on the premises, this lease may be terminated at the
option of either party. Such termination shall be effected by notice of one
party to the other within twenty days after such notice; and both parties shall
thereafter be released from all future obligations hereunder.
13. MECHANICS' LIENS. Neither Tenant, nor anyone claiming by, through,
or under Tenant, shall have the right to file any mechanic's lien against the
premises. Tenant shall give notice in advance to all contractors and
subcontractors who may furnish, or agree to furnish, any material, service or
labor for any improvement on the premises.
14. DEFAULT, NOTICE OF DEFAULT AND REMEDIES.
EVENTS OF DEFAULT
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A. Each of the following shall constitute an event of default by
Tenant: (1) Failure to pay rent when due; (2) failure to observe or perform any
duties, obligations, agreements, or conditions imposed on Tenant pursuant to the
terms of the lease; (3) abandonment of the premises. "Abandonment" means the
Tenant has failed to engage in its usual and customary business activities on
the premises for more than fifteen (15) consecutive business days; (4)
institution of voluntary bankruptcy proceedings by Tenant; institution of
involuntary bankruptcy proceedings in which the Tenant thereafter is adjudged a
bankruptcy; assignment for the benefit of creditors of the interest of Tenant
under this lease agreement; appointment of a receiver for the property or
affairs of Tenant, where the receivership is not vacated within ten (10) days
after the appointment of the receiver.
NOTICE OF DEFAULT
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B. Landlord shall give Tenant a written notice specifying the default
and giving the Tenant ten (10) days in which to correct the default. If there is
a default (other than for nonpayment of a monetary obligation of Tenant,
including rent) that cannot be remedied in ten (10) days by diligent efforts of
the Tenant, Tenant shall propose an additional period of time in which to remedy
the default. Consent to additional time shall not be unreasonably withheld by
Landlord. Landlord shall not be required to give Tenant any more than three
notices for the same default within any 365 day period.
REMEDIES
C. In the event Tenant has not remedied a default in a timely manner
following a Notice of Default, Landlord may proceed with all available remedies
at law or in equity, including but not limited to the following: (1)
Termination. Landlord may declare this lease to be terminated and shall give
Tenant a written notice of such termination. In the event of termination of this
lease, Landlord shall be entitled to prove claim for and obtain judgment against
Tenant for the balance of the rent agreed to be paid for the term herein
provided, plus all expenses of Landlord in regaining possession of the premises
and the reletting thereof, including attorney's fees and court costs, crediting
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against such claim, however, any amount obtained by reason of such reletting;
(2) Forfeiture. If a default is not remedied in a timely manner, Landlord may
then declare this lease to be forfeited and shall give Tenant a written notice
of such forfeiture, and may, at the time, give Tenant the notice to quit
provided for in Chapter 648 of the Code of Iowa.
15. SIGNS. Landlord, during the last ninety days of this lease, shall
have the right to maintain on the premises either or both a "For Rent" or "For
Sale" sign. Tenant will permit prospective tenants or buyers to enter and
examine the premises.
16. NOTICES AND DEMANDS. All notices shall be given to the parties
hereto at the addresses designated unless either party notifies the other, in
writing, of a different address. Without prejudice to any other method of
notifying a party in writing or making a demand or other communication, such
notice shall be considered given under the terms of this lease when it is
deposited in the U.S. Mail, registered or certified, properly addressed, return
receipt requested, and postage prepaid.
17. PROVISIONS BINDING. Each and every covenant and agreement herein
contained shall extend to and be binding upon the respective successors, heirs,
administrators, executors and assigns of the parties hereto.
18. ADDITIONAL PROVISIONS.
OPTION TO RENEW/EXTEND. At the option of the Tenant, this Lease may be
renewed or extended for two additional one-year terms. Notice of such
renewal shall be given by Tenant to Landlord more than thirty (30) days
in advance of the expiration of the lease term. If such
renewal/extension is exercised for the first year, the rent shall be
Six Hundred Fifty Dollars ($650.00) per month. If such
renewal/extension is exercised for the second year, the rent shall be
Seven Hundred Dollars ($700.00) per month.
GOVERNMENTAL PERMITS/APPROVALS. This lease is subject to and contingent
upon issuance of all necessary building permits and zoning approvals of
the City of Algona. If any necessary permit or approval has not been
issued or granted before June 16, 2003, the Lease shall terminate and
be of no force and effect.
IMPROVEMENTS. The parties jointly recognize that Tenant intends to make
improvements to the building including, but not limited to: HVAC
replacement and improvements, painting, carpeting and office
remodeling. It is agreed that any and all improvements shall inure to
the benefit of the building and, therefore, the Landlord. Any and all
building alterations or structural modifications shall be subject to
the prior approval of Landlord or its representative. Tenant shall have
the right to make such improvements at any time after the execution
hereof and prior to the date of occupancy as set forth in paragraph 1
hereof.
FAIR TIME USE. Annually, Tenant shall make available to Landlord the
use of the "center" portion of the structure for a period of seven (7)
days commencing on the Monday of "fair week". Landlord and Tenant
mutually agree to work together to address access and security issues
at said times.
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LANDLORD: TENANT:
KOSSUTH COUNTY AGRICULTURAL ASSOCIATION
(A/K/A KOSSUTH COUNTY FAIR BOARD) HYDROGEN ENGINE CENTER, INC.
By: /s/ Thomas Henry By: /s/ Theodore G. Hollinger
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Thomas Henry, Chairman/President Theodore G. Hollinger, President
By: /s/ Kim Ruby
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Kim Ruby, Secretary
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LEASE - BUSINESS PROPERTY - SHORT FORM
THE IOWA STATE BAR ASSOCIATION
Official Form No. 165
Recorder's Cover Sheet
Preparer Information: (name, address and phone number)
Michael E. Gabor, 111 North Dodge Street, Algona, IA 50511,
Phone: (515) 295-3565
Taxpayer Information: (name and complete address)
Hydrogen Engine Center, Inc.
700 East Fair Street
Algona, IA 50511
Return Document To: (name and complete address)
Michael E. Gabor
111 North Dodge Street
Algona, IA 50511
Grantors:
Kossuth County Agricultural Association (a/k/a Kossuth County Fair Board)
Grantees:
Hydrogen Engine Center, Inc.
Legal Description: See Page 2
Document or instrument number of previously recorded documents:
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