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EXHIBIT 10.2
LEASE
THIS LEASE made and entered into as of this 20th day of October, 1994, by
and between LOUIS V. BUZZITTA and CATHERINE F. BUZZITTA, of Suite 602, 221
Michigan, N.E., Grand Rapids, Michigan 49503 ("Landlord"), and HUGHES PLASTICS,
INC., a Michigan corporation, of 211 Kerth Street, P.O. Box 86, St. Joseph,
Michigan 49085 ("Tenant").
WITNESSETH:
That Landlord, in consideration of Tenant's covenants and agreements
herein contained, has demised and leased, and by these presents does demise and
lease unto Tenant, the premises located at 211 Kerth Street, St. Joseph,
Michigan 49085, legally described as set forth on attached Exhibit A, and all
buildings and improvements located thereon, subject to restrictions, covenants,
agreements and easements of record, all laws and ordinances, to be occupied by
Tenant for any and all lawful purposes in connection with Tenant's business.
This Lease replaces and supersedes any and all previous leases, and any
amendments thereto, entered into between Landlord and Tenant with respect to
the premises located at 211 Kerth Street, St. Joseph, Michigan 49085 prior to
the date of this Lease.
The parties hereto further mutually covenant and agree as follows:
ARTICLE I
TERM
1.1 Term. This Lease shall be for a term of seven (7) years, from
the date hereof. If Tenant requests construction of additional space pursuant
to Section 2.4 below during the initial or renewal term, the length of the term
of this lease shall be extended to seven (7) years from the date Tenant takes
possession of the additional space. In the event that Tenant requests
construction of the additional space during the initial term hereunder the
renewal term as set forth in paragraph 1.3 below shall remain in effect.
1.2 Occupancy. The Leased Premises shall be available to Tenant
from and after the date hereof.
1.3 Renewal. Tenant is hereby granted one (1) option to extend the
term of this Lease for seven (7) additional years,
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exercisable in writing delivered to Landlord at least twelve (12) months prior
to expiration of the Lease term.
ARTICLE II
RENT
2.1 Rent. Tenant agrees to pay to Landlord, as rent for the Leased
Premises, $21,000 per month in advance on the first day of each month.
2.2 Late Payment. If any monthly payment due hereunder from Tenant
is not received by Landlord within ten (10) days of the date due, Tenant shall
pay to Landlord as a late charge the sum of One Hundred Dollars ($100) for each
such monthly installment not paid within ten (10) days of its due date.
Acceptance of any late charge shall not constitute a waiver of Tenant's default
with respect to the overdue amount, or prevent Landlord from exercising any of
the other rights and remedies available to Landlord for Tenant's default.
2.3 Time for Payment. All rent shall be payable in advance on the
first (1st) day of each and every month during the term of this Lease. If
this Lease commences or terminates on a day other than the first (1st) day of
the month, rent shall be prorated accordingly on the basis of a thirty (30) day
month.
2.4 Additional Space. At Tenant's request, Landlord shall
construct, at Landlord's sole cost and expense, approximately 20,000 square
feet of additional space which will be connected to the building currently
located at the Leased Premises. The plans and specifications for such
additional space shall be subject to Tenant's approval. Upon completion of
such additional space and possession by Tenant, it will become subject to all
of the terms of this Lease. Landlord and Tenant shall agree upon the rent for
the additional space in writing prior to commencement of construction. The
rent shall reflect the reasonable rental value of the additional space.
ARTICLE III
USE OF THE PREMISES
3.1 Use of the Premises. Tenant shall not use the Leased Premises
or any part thereof for any purpose other than the conduct of its usual
business without the prior written consent of the Landlord, which consent may
be withheld for any reason whatsoever, nor for any use which would violate any
of the other covenants, agreements, terms, provisions or conditions of this
Lease nor, in any event, for any unlawful purposes or in any unlawful manner.
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3.2 Licenses. If any governmental license or permit shall be
required for the proper and lawful conduct of Tenant's business, Tenant shall
duly procure and thereafter maintain such license or permit and submit the same
for inspection by Landlord. Tenant shall, at all times, comply with the terms
and conditions of each such license or permit.
ARTICLE IV
CARE OF THE PREMISES; ALTERATIONS
4.1 Care of the Premises. Subject to the Landlord's
responsibilities referenced in the last sentence of this paragraph, Tenant
shall keep the Leased Premises and all improvements made thereto during the
term hereof in good condition and repair, and shall yield and deliver up the
same at the expiration of the term in as good condition as when taken, ordinary
wear and tear excepted. Tenant shall also maintain all portions of the Leased
Premises in a clean and orderly condition, free of dirt, rubbish and unlawful
obstructions. All repairs shall be completed and maintenance performed in good
workmanlikemanner, free and clear of all liens and encumbrances arising out of
such work. Landlord shall, at its expense, keep in good condition and repair
the general structure of the building, including, but not limited to, the roof,
floors, walls (excluding glass), sidewalks and the exterior.
4.2 Right of Entry. Landlord shall have the right, upon two (2)
days' prior written notice to Tenant (or without any notice whatsoever in case
of emergency), to enter upon the Leased Premises for the purpose of making any
repairs thereto and performing any work thereon which may be necessary by
reason of Tenant's failure to make any such repairs or perform any such
maintenance work as provided herein after written notice thereof. Except in
case of emergency, the privilege and right of entry shall be exercised at
reasonable times and at reasonable hours without disruption to Tenant's
business. Tenant shall pay the reasonable cost of any such repairs and
maintenance work to Landlord upon demand therefor and upon submission of
satisfactory evidence of Landlord's incurring of such costs, which sums shall
be deemed additional rent hereunder. Except as provided in Article VII, Tenant
shall not be entitled to any abatement of rent on account of work performed
upon the Leased Premises.
4.3 Alterations. Tenant, at its expense, may make changes and
improvements to the Leased Premises, provided any such changes or improvements
shall:
(a) be made only with the prior written consent of
Landlord, which consent shall not be unreasonably withheld;
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(b) comply with all governmental requirements; and
(c) be performed by a licensed contractor first approved
by Landlord, which approval shall not be unreasonably withheld.
ARTICLE V
UTILITIES AND TAXES
5.1 Utilities. Tenant shall pay for utilities used in or about the
Leased Premises, including, without limitation, gas, electricity, light, heat,
power and water. Telephone or other communication services shall also be paid
by Tenant. Tenant shall furnish to Landlord receipts or other satisfactory
proof of payment of such charges upon demand by Landlord.
5.2 Indemnification. Landlord shall not be liable and Tenant will
hold harmless, indemnify and defend Landlord against any failure of water
supply, electric current or other utility, for injury to persons, including
death, or damage to property, or for interference with light or other
easements, however caused, except if due to the negligent acts or omissions of
Landlord (in its capacity as Landlord).
5.3 Modification or Replacement. If the Leased Premises are
required to be modified or replaced for any reason by any utility company or
authorized agency, governmental or otherwise, then Tenant shall comply with the
same at its own cost and shall hold Landlord harmless therefrom, except that
Landlord will be responsible for any such required modifications or
replacements which were requested or ordered prior to the date of this Lease.
5.4 Taxes. Tenant shall pay all property (real and personal) taxes
and the current portion of any special assessments when the same shall become
due and payable from and after the commencement of this Lease through and
including the last day of the term.
ARTICLE VI
INSURANCE
6.1 Tenant's Insurance. Tenant shall, at its sole expense, during
the term hereof, obtain and keep insurance in effect, insuring Tenant and
Landlord in accordance with the following:
(a) Fire and extended coverage insurance on all buildings
and improvements on the Leased Premises in an amount not less than the
full replacement cost adjusted annually with coverage against fire with
standard extended coverage,
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vandalism and malicious mischief, sprinkler leakage (if applicable) and
water damage, or in such other forms and amounts as reasonably required by
Landlord; and
(b) Public liability and property damage insurance
including all activities and operations conducted by Tenant and any other
person in the Leased Premises; such insurance shall be written on a
comprehensive basis in an amount not less than $1,000,000 per injury and
$1,000,000 per accident, or in such other forms and other amounts as
reasonably required by Landlord.
The policies referred to in subparagraphs (a) and (b) shall provide that
the interest of Landlord shall not be invalidated because of any breach or
violation of any warranties, representations, declarations or conditions
contained in the policies and each of such policies shall contain a provision
waiving any right for contribution by Landlord under any other insurance
available to Landlord.
Landlord hereby represents and warrants that the insurance policies
existing prior to the execution of this Lease meet the requirements of this
Article VI.
Tenant shall provide a certificate of such insurance coverage to Landlord,
during the term hereof, upon request, provide additional certificates of such
insurance coverage, each of which shall state that the coverage evidenced
thereby will not expire or be cancelled except upon thirty (30) days prior
written notice to Landlord.
6.2 Indemnification. Tenant hereby covenants and agrees to
indemnify and hold Landlord harmless from all loss, damage, liability and
expense, including reasonable attorney's fees (through appellate and
enforcement proceedings), resulting from injury to person or any loss of or
damage to any property caused by or resulting from any act, omission or
negligence of Tenant or any officer, employee, agent, contractor, invitee or
visitor of Tenant in and about the Leased Premises or the buildings or
improvements located thereon, except to the extent any loss, damage, liability
or expense results from the negligent actions or omissions of Landlord (in its
capacity as Landlord) or any officer, employee, agent, contractor, invitee or
visitor of Landlord. Landlord shall not be liable for any loss or damage to
person or property sustained by Tenant or any other person which may be caused
by the condition of the Leased Premises or the buildings or improvements
located thereon or any visitor, agent, employee, invitee or licensee in or
about the same. Landlord shall not be liable for any loss or damage to person
or property of Tenant or of others located at the Leased Premises by theft or
otherwise or resulting from fire, explosion, falling plaster, steam, gas,
electricity, water, rain or snow or leaks from any part of the Leased Premises
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or from the pipes, appliances or plumbing work or from the roof, street or
subsurface or from any other place or by dampness or for any cause whatsoever.
6.3 Waiver of Subrogation. Landlord and Tenant each hereby waive,
as to the other, all right of recovery which one might otherwise have against
the other, and its agents, employees, invitees, guests or licensees, for any
loss or damage to any property or for any personal injury which is covered by a
policy or policies of insurance, notwithstanding that such loss or damage may
result from the negligence or fault of the non-insured party, or its agents,
employees, invitees, guests or licensees. Any deductible amount included in
such policy or policies shall be treated as though it were recoverable under
the policy or policies. Landlord and Tenant shall each cause their insurance
underwriters to include waiver of subrogation endorsements in all insurance
policies underwritten with respect to this Lease, the Leased Premises or the
buildings and improvements thereon.
ARTICLE VII
DAMAGE AND CONDEMNATION
7.1 Damage. If the Leased Premises or any part thereof shall be
damaged by fire or other casualty, subject to the terms hereof, Landlord shall
proceed with reasonable diligence to repair or cause to be repaired such damage
to the condition in which the Leased Premises were delivered by Landlord to
Tenant, and if the Leased Premises, or any part thereof, shall be rendered
untenantable by reason of such damage, rent hereunder, or an amount thereof
apportioned according to the area of the Leased Premises so rendered
untenantable, if less than the entire Leased Premises, shall be abated for the
period from the date of such damage to the date when the damage shall have been
repaired as aforesaid; provided, however, that if Landlord or any mortgagee of
the Leased Premises (and buildings and improvements) shall be unable to collect
the insurance proceeds (including rent insurance proceeds) applicable to such
damage because of some action or inaction on the part of Tenant, or the
employees, licensees or invitees of Tenant, the consequential damages of
Landlord resulting from such delay shall be paid by Tenant and there shall be
no abatement of rent. Landlord shall not be liable for any inconvenience or
annoyance to Tenant or injury to the business of Tenant resulting in any way
from such damage or the repair thereof. Landlord will not carry insurance of
any kind on Tenant's furniture or on any fixtures or equipment removable by
Tenant under the provisions of this Lease, nor on any improvement, alteration
or betterment made by Tenant to the Leased Premises, and Landlord shall not be
obligated to repair any damage thereto or to replace the same. Notwithstanding
the foregoing, in case the Leased Premises shall be so damaged by such fire or
other casualty that substantial alteration or
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reconstruction of the building shall be required, then Landlord may, at its
option, terminate this Lease and the term and estate hereby granted by
notifying Tenant in writing of such termination within sixty (60) days after
the date of such damage. Notwithstanding any term or provision hereof to the
contrary, Landlord shall not be liable for any damages to Tenant for delays in
commencing or completing repairs to the Leased Premises after fire or other
casualty resulting from adjustment of insurance claims, governmental
requirements or any cause beyond Landlord's reasonable control.
7.2 Condemnation. In the event of the taking or condemnation for
any reason by any public or quasi-public authority, entity or corporation
having the power of eminent domain, the following shall apply:
(a) If the entire Leased Premises is taken or condemned,
this Lease shall terminate effective as of the date of taking.
(b) If a portion of the Leased Premises is taken or
condemned and the remainder is, in Tenant's opinion, not economically
usable by Tenant, Tenant shall notify Landlord of the termination of this
Lease effective as of the date of taking.
(c) If a portion of the Leased Premises is taken or
condemned and the remainder is, in Tenant's opinion, economically usable
by Tenant, this Lease shall terminate as to the portion taken, effective
as of the date of taking, and continue as to the remainder. Landlord
shall, to the extent reasonable, using only the award from such
condemnation proceedings, repair and restore the remainder to its
condition as of the date of taking. Tenant's rent hereunder shall be
reduced by the ratio of the area taken to the area of the Leased Premises
prior to the taking. Any prepaid rent shall be applied against subsequent
rental due.
All damages awarded for any taking under the power of condemnation shall
belong to and be the property of Landlord whether such damages be awarded as
compensation for diminution in value of the leasehold or to the fee of the
Leased Premises; provided, however, that Landlord shall not be entitled to any
portion of the award specifically designated as compensation made to Tenant for
removal and reinstallation of Tenant's movable trade fixtures, moving expenses
or value of Tenant's lost profits.
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ARTICLE VIII
DEFAULT
8.1 Events of Default; Remedies. The occurrence of any of the
following is hereinafter referred to as "Event of Default":
(a) The failure, neglect or refusal of Tenant to pay any
installment of rent or to pay any other moneys, payments or additional
charges payable by Tenant when and as the same shall become due and
payable under the terms of this Lease, if any such default shall continue
for a period of more than fifteen (15) days after written notice of such
default;
(b) The failure, neglect or refusal of Tenant to keep and
perform any of the other terms, covenants, conditions, stipulations,
obligations or agreements contained in this Lease covenanted and agreed to
be kept and performed by Tenant, if any such default shall continue for a
period of more than thirty (30) days after written notice of such default;
or
(c) Tenant becoming bankrupt or insolvent, or filing any
debtor proceedings, or taking or having taken against Tenant in any court
pursuant to any statute either of the United States or of any state a
petition in bankruptcy or insolvency or for reorganization or for
appointment of a receiver or trustee of all or a portion of Tenant's
property, or Tenant making an assignment for the benefit of creditors, or
petitioning for or entering into an arrangement, or Tenant suffering any
lien, levy or encumbrance to be filed against the Leased Premises, or if
this Lease be taken under any writ of execution.
8.2 Remedies On Default. Upon the occurrence of an Event of
Default, Landlord may exercise any or all of the following remedies, in
addition to any other remedy now or subsequently permitted by law:
(a) Right of Re-Entry. Except as otherwise required by
provisions of Michigan law which cannot be waived, Tenant does hereby
authorize and fully empower Landlord or Landlord's agents to reenter and
take possession of the Leased Premises without any previous notice of
intention to re-enter or resort to legal process and to remove all persons
and property from the Leased Premises, and to use such force and
assistance in effecting and perfecting such removal of said persons and
property as may be necessary or advisable to recover exclusive possession
of all of the Leased Premises, whether in the possession of Tenant or of
third persons or otherwise, without being deemed guilty in any manner of
trespass, without becoming liable for any loss or damage occasioned
thereby, and
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without prejudice to any remedies which might otherwise be available to
Landlord. No reentry or taking possession of the Leased Premises by
Landlord shall be construed as an election on its part to terminate this
Lease unless a written notice of such intention be given to Tenant by
Landlord or unless the termination thereof be decreed by a court of
competent jurisdiction.
(b) Right to Relet. Should Landlord elect to reenter and
take possession as herein provided, or should Landlord reenter or take
possession pursuant to legal proceedings or pursuant to any notice
provided by law, Landlord may either terminate this Lease or Landlord may
continue this Lease in full force and effect, and the Lease will continue
in effect as long as Landlord does not terminate this Lease, and Landlord
shall have the right to collect rent from Tenant when due. During the
period Tenant is in default, Landlord may relet the Leased Premises or any
part of the Leased Premises to third parties for Tenant's account. Tenant
shall be liable immediately to Landlord for all costs Landlord incurs in
reletting the Leased Premises or any part of the Leased Premises,
including, without limitation, brokers' commissions, reasonable attorneys'
fees (through appellate and enforcement or collection proceedings),
expenses of repairs and remodeling the Leased Premises as may be necessary
in Landlord's judgment to relet the Leased Premises, and like costs.
Reletting can be for a period shorter or longer than the remaining term of
this Lease and at such rental or rentals and upon such other terms and
conditions as Landlord in its sole discretion shall deem advisable.
Tenant shall pay to Landlord the rent due under this Lease on the dates
the rent is due, less the rent Landlord receives from any reletting.
If Landlord elects to relet the Leased Premises as provided in
this subsection, rent that Landlord receives from reletting shall be
applied to the payment of: first, any indebtedness from Tenant to
Landlord other than rent due from Tenant, including all damages sustained
by Landlord as a result of the Event(s) of Default; second, all costs,
including for maintenance, incurred by Landlord in reletting; and, third,
rent due and unpaid under this Lease. After such application of the rent
received from reletting, any sum remaining from the rent Landlord receives
from reletting shall be held by Landlord and applied in payment of future
rent as rent becomes due under this Lease. In no event shall Tenant be
entitled to any excess rent received by Landlord. Landlord reserves the
right to bring any action or legal proceeding for the recovery of any
deficits remaining unpaid as Landlord may deem favorable, from time to
time, without being obliged to wait until the end of the term hereof, or
for the final determination of Tenant's account. No such reletting of the
Leased Premises by Landlord and no other act by Landlord
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allowed by this subsection shall be construed as an election on Landlord's
part to terminate this Lease unless a written notice of such intention be
given to Tenant by Landlord or unless the termination hereof be decreed by
a court of competent jurisdiction.
(c) Right to Terminate. Landlord may, at any time after
reentry and/or reletting, elect to terminate this Lease for the Event of
Default giving rise to such reentry and/or reletting, or, absent such
reentry or reletting without termination, may terminate this Lease at
anytime when there is an Event(s) of Default. No act by Landlord other
than giving written notice of termination to Tenant shall terminate this
Lease. Reentry, acts of maintenance, efforts to relet or reletting the
Leased Premises, or the appointment of a receiver on Landlord's initiative
to protect Landlord's interests under this Lease shall not constitute a
termination of this Lease. On termination of this Lease, Landlord has the
right to recover from Tenant:
(i) The unpaid rent, additional rent, and other
charges that were payable at the time of termination of this
Lease, together with interest thereon from the date due at the
lesser of the highest rate permitted by law or fifteen percent
(15%) per annum;
(ii) The amount by which the unpaid rent,
additional rent and other charges that would have been payable
after the date of termination of this Lease until the time of
award exceeds the amount of the loss of rent that Tenant
proves could have been reasonably avoided, together with
interest on such difference as it accrued at two percent (2%)
over NBD Bank, N.A.'s applicable prime rate of interest which
is from time to time in effect;
(iii) The present value, at the time of the
award, of the amount by which the unpaid rent, additional rent
and other charges for the balance of the term after the time
of award exceeds the amount of the loss of rent that Tenant
proves could have been reasonably avoided, with such present
value to be computed by discounting such difference at the
lesser of fifteen percent (15%) per annum or the discount rate
of the Federal Reserve Bank of Chicago at the time of the
award; and
(iv) Any other amount necessary to compensate
Landlord for all detriment proximately caused by Tenant's
default.
8.3 Removal of Property. Should Landlord elect to reenter and
take possession as herein provided, or should Landlord reenter
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and take possession pursuant to legal proceedings or pursuant to any notice
provided by law, Landlord may remove all personal property from the Leased
Premises and store such property, without liability for loss or damage, such
storage to be for the account and at the expense of Tenant. In the event that
Tenant shall not pay the cost of storing any such property after it has been
stored for a period of thirty (30) days or more, Landlord may, at its option,
sell, or permit to be sold, any or all of such property at public or private
sale, in such manner and at such times and places as Landlord in its sole
discretion may deem proper, without notice to Tenant, and shall apply the
proceeds of such sale: first to the costs and expenses of such sale, including
reasonable attorneys' fees (through appellate and enforcement or collection
proceedings); second to the payment of the costs for storing such property;
third to the payment of any other money which may then be or thereafter become
due Landlord from Tenant under any of the terms of this Lease; and fourth, the
balance, if any, to Tenant.
8.4 No Release. Landlord shall in no event, whether or not
Landlord has re-entered or taken possession of the Leased Premises and whether
or not this Lease has been terminated, be obligated to or be responsible in any
way whatsoever for failure to relet the Leased Premises, or in the event that
the Leased Premises are relet, for failure to collect the rent thereof under
such reletting. The failure of Landlord to relet the Leased Premises or any
part thereof shall not release or affect Tenant's liability for rent or
damages.
8.5 Cure. Landlord, at any time after Tenant commits a default,
can cure the default at Tenant's cost. If Landlord at any time, by reason of
Tenant's default, pays any sum or does any act that requires the payment of any
sum, the sum paid by Landlord shall be due immediately from Tenant to Landlord
at the time the sum is paid, and if paid at a later date shall bear interest at
two percent (2%) over NBD Bank, N.A.'s applicable prime rate of interest which
is from time to time in effect from the date the sum is paid by Landlord until
Landlord is reimbursed by Tenant. The sum, together with interest, shall be
additional rent.
8.6 Remedies Cumulative. All rights and remedies of Landlord and
Tenant under this Lease are cumulative and none shall exclude any other rights
or remedies provided by law, specifically including, but not limited to,
summary proceedings pursuant to MCLA 600.5701, et seq.
ARTICLE IX
ACCESS TO LEASED PREMISES
9.1 Access. Landlord and Landlord's authorized representatives
shall have the right to enter upon the Leased Premises at all
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reasonable hours for the purpose of inspecting the same and, for the period of
twelve (12) months prior to termination of this Lease, for the purpose of
reletting the Leased Premises; provided, however, Landlord will not
unreasonably interfere with Tenant's business when exercising such right of
access to the Leased Premises.
ARTICLE X
HOLDING OVER
10.1 Holding Over. It is hereby agreed that, in the event Tenant
holds over after the termination of the term of this Lease, the tenancy shall
be from month-to-month in the absence of a written agreement to the contrary.
ARTICLE XI
FINANCIAL STATEMENTS
11.1 Financial Statements. Tenant shall submit a financial
statement to any proposed financier or purchaser, upon request, if Landlord is
required to have said statement for financing or sale of the Leased Premises,
said statement to be held confidential by any financier or proposed purchaser.
ARTICLE XII
MECHANICS LIENS
12.1 Mechanics Lien. Tenant shall not create or permit to be
created nor allow to remain, and will promptly discharge, at its sole cost and
expense, any lien, encumbrance or charge upon the Leased Premises or any part
thereof, except such as are created by Landlord or Landlord's mortgagee(s).
ARTICLE XIII
ASSIGNMENT AND SUBLETTING
13.1 Assignment and Subletting. Tenant shall not, without
Landlord's prior written consent, which consent will not be unreasonably
withheld, have the right to sublease the Leased Premises or assign its rights
under this Lease. Notwithstanding any such sublease or assignment, Tenant and
all assignees and sublessees shall remain liable for the performance of all of
Tenant's obligations contained in this Lease. Any assignee or sublessee will
be required to execute an instrument in writing
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assuming, along with Tenant and jointly and severally, all of Tenant's
obligations and liabilities to Landlord.
13.2 Sale or Transfer. If the Leased Premises is sold or
transferred, Landlord shall be automatically and entirely released from all of
its covenants and obligations under this Lease from and after the date of such
conveyance or transfer. The new owner or transferee shall assume all of
Landlord's obligations to Tenant under this Lease. Tenant agrees to recognize
and attorn to such new owner or transferee as Landlord.
ARTICLE XIV
ESTOPPEL AGREEMENT
14.1 Estoppel Agreement. Tenant shall, without charge and at any
time and from time to time, within ten (10) days after request by the Landlord,
certify by written instrument, duly executed, acknowledged and delivered to any
mortgagee, assignee of any mortgagee or purchaser, or any proposed mortgagee,
proposed assignee or proposed purchaser, or any other person, firm or
corporation specified by Landlord:
(a) That this Lease is unmodified and in full force and
effect (or, if there have been modifications, that the same is in full
force and effect as modified and stating the modifications);
(b) Whether or not there are then existing, to the best
of its knowledge, any setoffs or defenses against the enforcement of
any of the agreements, terms, covenants or conditions hereof upon the
part of Tenant to be performed or complied with (and, if so,
specifying the same); and
(c) The dates, if any, to which the rental(s) and other
charges hereunder have been paid in advance.
ARTICLE XV
NON-LIABILITY AND INDEMNIFICATION
15.1 Non-Liability. Neither Landlord nor its agents shall be
liable for any injury or damage to persons or the property of Tenant, its
agents, employees, visitors, invitees or licensees in, upon or about the Leased
Premises, except to the extent that such injury or damage results from the
negligence of Landlord (in its capacity as Landlord).
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15.2 Indemnification. Tenant hereby holds harmless, indemnifies
and agrees to defend Landlord and its agents against any and all liability,
damages, expenses, fees, penalties, causes of action, suits, costs, legal fees,
claims or judgments arising from injury to persons or property occasioned by
any act or acts, omission or omissions of Tenant, its agents, servants,
contractors, employees, visitors, invitees or licensees, occurring in, upon or
about the Leased Premises.
15.3 Recourse Against Landlord. In the event Landlord shall
neglect or fail to perform or observe any of the covenants, provisions or
conditions contained in this Lease on its part to be performed or observed
within thirty (30) days after written notice of default or if more than thirty
(30) days shall be required because of the nature of the default, if Landlord
shall fail to proceed diligently to cure such default after written notice,
then in that event, Landlord shall be responsible to Tenant for any and all
damages sustained by Tenant as a result of Landlord's breach.
ARTICLE XVI
SURRENDER OF PREMISES
16.1 Surrender. Upon the expiration or other termination of this
Lease, Tenant shall immediately surrender possession of the Leased Premises to
Landlord, in broom-clean condition, together with all improvements or additions
in or to the Leased Premises, by whomsoever made, in the condition as received,
or first installed, ordinary wear and tear excepted.
16.2 Fixtures. All trade fixtures, improvements and light fixtures
installed by Tenant in connection with the business conducted by it on the
Leased Premises shall remain the property of Tenant and may be removed by it
during or at the expiration of this Lease; provided, however, that Tenant is
not in default under any of the provisions of this Lease. Any damage caused by
such removal is to be repaired by Tenant if so required by Landlord.
16.3 Removable Personal Property. Upon expiration of this Lease,
Tenant, at its expense, shall remove all moveable office furnishings and
equipment installed by Tenant at its expense. Tenant agrees that it will pay
the cost of repairing any damage to the Leased Premises or to the buildings
thereon arising from the removal of any property which it is permitted or
obligated to remove from the Leased Premises. Any property left on the Leased
Premises after the expiration of this Lease shall be deemed conclusively to
have been abandoned and to be the property of Landlord to dispose of as
Landlord deems most expedient.
16.4 Indemnification. Tenant shall indemnify, defend and hold
Landlord harmless from and against any loss or liability resulting
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from delay by Tenant in surrendering the Leased Premises, including, without
limitation, any claims made by any succeeding tenant.
ARTICLE XVII
SUBORDINATION TO MORTGAGES; ATTORNMENT
17.1 Subordination. This Lease is and shall be subject and
subordinate to any mortgage or mortgages now in force or which shall at any
time hereafter be placed upon the Leased Premises or the buildings thereon, and
to each and every advance heretofore or hereafter made under and pursuant to
any such mortgage(s). Tenant agrees that it will, upon demand and without
charge, execute and deliver such instruments as shall be required by any
mortgagee or proposed mortgagee to confirm or to effect more fully
subordination of this Lease to the lien of any such mortgage or mortgages.
Notwithstanding such subordination, Tenant's right to quiet enjoyment of the
Leased Premises shall not be disturbed if Tenant is not in default hereunder
and so long as Tenant shall pay the rent, additional rent and any other charges
and observe and perform all of the provisions of this Lease, unless this Lease
is otherwise terminated pursuant to its terms.
17.2 Attornment. In the event of any sale of the Leased Premises
or in the event any proceedings are brought for the foreclosure of, or in the
event of conveyance by deed in lieu of foreclosure of, or in the event of any
exercise of the power of sale under, any mortgage made by Landlord with respect
to the Leased Premises, Tenant hereby agrees to attorn to, and agrees to
execute instruments reasonably satisfactory to, the new owner, whereby Tenant
attorns to such new owner and recognizes such new owner as Landlord under this
Lease.
ARTICLE XVIII
QUIET ENJOYMENT
18.1 Quiet Enjoyment. Landlord covenants that if, and so long as,
Tenant keeps and performs each and every covenant, agreement, term, provision
and condition herein contained on the part and on behalf of Tenant to be kept
and performed, Tenant shall quietly enjoy the Leased Premises without hindrance
or molestation by Landlord or by any other person lawfully claiming the same,
subject to the covenants, agreements, terms, provisions and conditions of this
Lease or to any mortgage to which this Lease is subject and subordinate.
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ARTICLE XIX
ENVIRONMENTAL REPRESENTATIONS; COVENANTS;
WARRANTIES AND INDEMNIFICATION
19.1 Hazardous Substance. Hazardous Substances include, without
limitation, any flammable explosives, radioactive materials, hazardous
materials, hazardous wastes, hazardous or toxic substances or related materials
defined in the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended (42 U.S.C. Section 9601, et. seq.), the Hazardous
Materials Transportation Act, as amended (49 U.S.C. Sections 1801, et. seq.),
the Resource Conservation and Recovery Act, as amended (42 U.S.C. Section 6901,
et. seq.), and in the regulations adopted and publications promulgated pursuant
thereto, or any other Federal, state or local governmental law, ordinance, rule
or regulation.
19.2 Warranties. The provisions of this Article shall be in
addition to any and all other obligations and liabilities Tenant may have to
Landlord hereunder, and in common law, and shall survive after termination of
this Lease.
Tenant shall not cause or permit any Hazardous Substances to be
released, brought upon, stored, produced, emitted, disposed of or used upon,
about or beneath the Premises by Tenant, its agents, employees, contractors or
invitees.
19.3 Indemnification. Tenant shall indemnify, defend and hold
Landlord, and its employees, agents, officers and directors, harmless from and
against any and all cost, loss, liability, damage and expense, including costs
associated with administrative and judicial proceedings and attorneys' and
consultants' fees, ever suffered or incurred by Landlord on account of (i) the
presence upon, about or beneath the Premises of any Hazardous Substances or of
any chemical substance requiring remediation under any federal, state or local
statute, regulation, ordinance or policy; (ii) the breach of any of the
provisions of this Lease; or (iii) necessary for Landlord to make full economic
use of the Premises, or otherwise required under this Lease.
Notwithstanding any other obligation of Tenant to indemnify Landlord
pursuant to this Lease, Tenant shall, at its sole cost and expense, promptly
take all actions required by any federal, state or local governmental agency or
political subdivision or necessary for Landlord to make full economic use of
the Premises, which requirements or necessity arise from the presence upon,
about or beneath the Premises of any Hazardous Substances. Such actions shall
include, but not be limited to, the investigation of the environmental
condition of the Premises, the preparation of any remedial investigation and
feasibility studies or reports and the performance of any cleanup, remediation,
removal or restoration work. Tenant shall take all actions necessary to
restore the
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Premises, notwithstanding any lesser standard of remediation allowable under
applicable law or governmental policies. Tenant shall nevertheless obtain
Landlord's approval prior to undertaking any activities required by this
Section, which approval shall not be unreasonably withheld so long as such
actions would not potentially have a material adverse long-term or short-term
effect on the Premises or any other property or business owned or operated by
Landlord.
Tenant agrees to promptly provide Landlord with a copy of any letter,
inquiry, demand or complaint received by Tenant from any state or federal
agency, authority or other third party regarding the release or threatened
release of Hazardous Substances on, into, upon or from the Premises. Tenant
agrees to provide Landlord with copies of any notifications of releases of
Hazardous Substances which are given by or on behalf of Tenant to any federal,
state or local agencies or authorizes with respect to the Premises. Such
copies shall be sent to Landlord concurrently with their being mailed or
delivered to the governmental agencies or authorities.
Tenant shall conduct and complete all investigations, including a
comprehensive environmental audit, studies, sampling and testing, and all
remedial, removal and any other actions necessary to clean up and remove all
Hazardous Substances on, under, from or affecting the Premises as required by
all applicable Federal, state and local laws, ordinances, rules, regulations
and policies to the satisfaction of Landlord, and in accordance with the orders
and directives of all Federal, state and local governmental authorities.
ARTICLE XX
OPTION TO PURCHASE
20.1 Granting of Option and Price. So long as Tenant shall not be
in material default hereunder, Tenant shall have the option to purchase the
Leased Premises from Landlord at any time during the initial or renewal term
hereof in accordance with the terms and conditions of the purchase agreement
attached as Exhibit B to this Lease. The purchase price during the initial
term shall be Two Million Dollars ($2,000,000) if the additional space has not
been constructed pursuant to paragraph 2.4 above and Two Million Dollars plus
the actual cost incurred by Landlord in constructing the additional space if
the additional space has been constructed pursuant to paragraph 2.4 above. The
purchase price during the renewal term shall be Two Million Three Hundred
Thousand Dollars ($2,300,000) if the additional space has not been constructed
pursuant to paragraph 2.4 above and Two Million Three Hundred Thousand Dollars
plus the actual cost incurred by Landlord in constructing the additional space
if the additional space has been constructed pursuant to paragraph 2.4 above.
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20.2 Exercise of Option and Closing. The election of Tenant to
exercise this option must be evidenced by a written notice delivered to
Landlord. If Tenant exercises the option, Landlord shall deliver to Tenant a
current title insurance policy showing title to be merchantable, free and clear
of all liens, easements and encumbrances except such as are in existence as of
the date of this Lease. Transfer of title by Landlord to Tenant shall be
effected by warranty deed conveying merchantable title. The closing shall be
held within sixty (60) days after the exercise of the option, after which this
option shall be deemed to have expired.
ARTICLE XXI
MISCELLANEOUS
21.1 Notices. All notices permitted or required hereunder shall be
in writing and either by mail or personal delivery. If by mail, notice shall
be deposited in the United States mails, postage prepaid, registered or
certified mail, return receipt requested, and addressed to the party to whom
notice is directed. If by personal delivery, notice shall be personally
delivered to the party to whom notice is directed. Notice shall be deemed
effective on the date postmarked, if by mail, or on the date of delivery, if
personally delivered.
21.2 Severability. The invalidity or unenforceability of any
provision of this Lease shall not affect the validity or enforceability of any
remaining provisions and this Lease shall be construed in all respects as if
any invalid or unenforceable provision were omitted.
21.3 Waiver. No term, condition, covenant or provision contained
in this Lease may be waived except in a writing signed by the waiving party.
No oral statements, course of conduct or course of dealing shall be deemed a
waiver. No waiver by any party hereto of any violation or breach of this Lease
shall be deemed or construed to constitute a waiver of any other violation or
breach, or as a continuing waiver of any violation or breach.
21.4 Applicable Law. This Lease shall be interpreted, construed
and governed according to the laws of the State of Michigan.
21.5 Captions. The captions or headings to the various paragraphs
contained in this Lease are for convenience only and shall to no extent affect
the meaning, scope or interpretation hereof.
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21.6 Counterparts. This Lease may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which shall
constitute one instrument.
21.7 Binding Effect. This Lease shall be binding upon and inure to
the benefit of the parties hereto as well as their respective heirs, devisees,
executors, administrators, personal representatives, successors and assigns.
21.8 Merger and Modification. Except for the Stock Purchase
Agreement, dated October 13, 1994 among Larizza Industries, Inc., an Ohio
corporation or its appointed subsidiary, Diane M. Buzzitta, Louis V. Buzzitta,
Joseph T. Buzzitta, James V. Buzzitta, LVB Industries, Inc., a Michigan
corporation and Tenant, and any other document or agreement referenced therein,
this constitutes the entire agreement between the parties with respect to the
subject matter hereof and any prior discussions, negotiations and agreements
between the parties are merged herein. No amendment or modification of this
Lease shall be enforceable except if in writing and signed by the party against
whom enforcement is sought. Notwithstanding any term or provision in this
Lease to the contrary,
(i) the representations, warranties, covenants and
indemnifications of and by the Landlord and the other Sellers
contained in the Stock Purchase Agreement are incorporated into this
Lease and shall continue to be binding upon the Landlord and the other
Sellers, jointly and severally, after the execution of this Lease;
(ii) to the extent that there is any conflict, difference
or inconsistency between the terms of this Lease and the terms of
Stock Purchase Agreement, then the terms of the Stock Purchase
Agreement shall govern and control the rights and liabilities of the
Landlord and Tenant; and
(iii) if any breach by the Tenant of any representation,
warranty, covenant or indemnification under this Lease is caused by,
arises from, or is related to, any breach by the Landlord or any other
Seller of the terms of the Stock Purchase Agreement, the Tenant shall
have no liability or obligation with respect to such breached
representation, warranty, covenant or indemnification under this
Lease, and the Landlord and the other Sellers shall be jointly and
severally liable to Tenant with respect to such breach in accordance
with the terms of the Stock Purchase Agreement.
21.9 Payments Due on Sundays and Holidays. In any case where a
payment is due under the terms of this Lease on a Sunday or a legal holiday,
payment need not be made on such date but must be
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made on the next succeeding business day which is not a Sunday or legal
holiday.
21.10 Cumulative Remedies. The remedies provided in this Lease for
the benefit of Landlord and Tenant shall be cumulative.
21.11 Attorneys Fees and Costs. In the event of litigation for breach
or alleged breach of this Lease by either party, the prevailing party shall be
entitled to recover its reasonable attorneys fees and costs through all
appellate and enforcement or collection proceedings. [The signatures are
contained on the following page 20.]
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The parties hereto have executed this Lease as of the day and year
first written above.
LANDLORD:
/s/ LOUIS V. BUZZITTA
Louis V. Buzzitta
/s/ CATHERINE F. BUZZITTA
Catherine F. Buzzitta
TENANT:
HUGHES PLASTICS, INC.,
a Michigan corporation
By: /s/ TERENCE C. SEIKEL
Its: CFO
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EXHIBIT A
Legal Description
Lot 19, Assessor's Plat No. 1, City of St. Joseph, Berrien County,
Michigan, according to the plat thereof recorded October 18, 1973, in
Volume 22 of Plats, Page 34, Berrien County, Michigan Records.
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Exhibit B
AGREEMENT
OF
PURCHASE AND SALE
THIS AGREEMENT made this _______ day of _________, _____, by and between
(i) LOUIS V. BUZZITTA and CATHERINE F. BUZZITTA, his wife (jointly, "Seller"),
with offices at Suite 602, 221 Michigan N.E., Grand Rapids, Michigan 49503;
and (ii) LARIZZA INDUSTRIES, INC., an Ohio corporation or its designated
subsidiary ("Purchaser"), with offices at 201 W. Big Beaver, Suite 1040, Troy,
Michigan 48084.
R E C I T A L S :
A. Seller is the owner of certain real estate and a manufacturing and
office facility situated thereon located in Berrien County, Michigan, legally
described as set forth in Exhibit A, together with all tenements, easements,
hereditaments, privileges and appurtenances appertaining thereto, and all items
set forth in Article I hereof.
B. Seller has agreed to sell and Purchaser has agreed to purchase the
Property (as defined below) in accordance with the terms and conditions set
forth herein.
ACCORDINGLY, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, Seller and Purchaser do hereby
mutually covenant and agree as follows:
ARTICLE I
PROPERTY
As used herein, the term "Property" shall be deemed to include Seller's
entire right, title and interest in and to:
1.1 the real estate described in attached Exhibit A (the "Land"),
together with all easements, air, mineral, oil and gas rights, all tenements,
hereditaments, privileges and appurtenances thereto belonging or in any way
appertaining thereto;
1.2 all buildings and other improvements situated upon the Land (and,
together with the Land, sometimes referred to herein as the "Real Estate");
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1.3 all fixtures, equipment, furniture, supplies and other tangible
personal property of every kind and nature owned by Seller, located on or about
the Real Estate or used or useable in conjunction with the acquisition,
development, financing, leasing, maintenance and/or operation of the Real
Estate, including, but not limited to, all heating, lighting, plumbing,
electrical, air-conditioning, telephone, air filtration and treatment fixtures
and equipment, hot water heaters, security, television and cable equipment,
carpeting, furnaces, heating controls, motors, boiler pressure systems and
equipment, rest room fixtures, appliances, shelving, partitioning, ventilators,
incinerators, disposals, fire sprinkling system equipment, office equipment and
furniture, landscaping, maintenance and snow removal equipment and other
supplies and disposables, if any. A list of certain of such fixtures,
equipment, and personalty to be conveyed is attached hereto as Exhibit B and is
made a part hereof;
1.4 all right, title and interest of Seller in and to adjacent
streets, roads, alleys, or rights of way in any land lying in the bed of any
street, road or avenue, open or proposed, at the foot of or adjoining the Real
Estate to the center line thereof;
1.5 any intangible personal property located on or about or arising
out of the ownership of the Property;
1.6 any pending or future award made in condemnation or to be made in
lieu thereof, and any unpaid award for damage to the Real Estate;
1.7 the use of appurtenant easements, whether or not of record, strips
and rights-of-way abutting, adjacent, contiguous, or adjoining the Real Estate;
1.8 all licenses, permits and franchises issued by any Federal, state
or local authorities, relating to the development, use, maintenance or
operation of the Property;
1.9 all architectural and construction plans, specifications and
drawings relating to the construction of any improvements on the Real Estate
and all unexpired claims, warranties, guaranties and sureties received by
Seller in connection with the construction, improvement, equipment or repair of
or on the Property;
1.10 all logos, art work, signs, brochures, artists renderings and
other descriptive or promotional materials concerning the Property; and
1.11 all contracts relating to the Property, all of which are described
in attached Exhibit C (the "Contracts").
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ARTICLE II
PURCHASE AND SALE; PURCHASE PRICE
Subject to the terms and conditions herein contained, Seller agrees to
sell to Purchaser, and Purchaser agrees to purchase from Seller, the Property.
The total purchase price for the Property ("Purchase Price") shall be
determined as follows:
(a) if Purchaser exercises its option to purchase the Property
during the Initial Term (as such term is defined in that certain Lease
dated October __, 1994 between Seller, as lessor, and Purchaser, as
tenant [the "Lease"]), the Purchase Price shall be the sum of (i) Two
Million ($2,000,000) Dollars plus (ii) the out of pocket costs incurred
by Seller in constructing the additional space within the Property in
accordance with the provisions of the Lease; and
(b) if Purchaser exercises its option to purchase the Property
during the Renewal Term, as such term is defined in the Lease, the
Purchase Price shall be the sum of (i) Two Million Three Hundred Thousand
($2,300,000) Dollars plus (ii) the out of pocket cost incurred by Seller
in constructing the additional space within the Property in accordance
with the provisions of the Lease.
The Purchase Price shall be paid at closing in cash, cashier's check, or wire
transfer of immediately available federal funds, plus or minus the closing
adjustments and prorations set forth herein.
ARTICLE III
CLOSING
3.1 Consummation of the transactions described in this Agreement
("Closing") shall take place on such date ("Closing Date") as is ninety (90)
days from the Effective Date (or such earlier date as may be designated in
writing by Purchaser to Seller), unless extended pursuant to another provision
of this Agreement. If the Closing Date identified in the previous sentence is
a Saturday, Sunday or legal holiday, then Closing shall occur on the next
immediately following business day. Closing shall be held at 10:00 a.m., local
time, at the offices of Purchaser's attorney, Honigman Miller Schwartz and
Cohn, 2290 First National Building, Detroit, Michigan 48226, or at such other
time as may be mutually agreeable to the parties.
3.2 At the time and place of Closing, all of the closing items
described in Article IX, including all closing proceeds, shall be tendered to
the Title Company. The Title Company shall be authorized to consummate the
closing of the transaction contemplated hereunder at such time as the
applicable documents have been delivered to the Title Company and it is
prepared to issue the owner's policy of title insurance in accordance with the
provisions of Section 5.1 (a) below.
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ARTICLE IV
CONDUCT OF SELLER
Seller agrees that from the date of this Agreement to the Closing Date,
Seller shall:
(a) Refrain from transferring any of the Property or creating
on the Property any easements, liens, mortgages, encumbrances or other
interests which would affect the Property or Seller's ability to comply
with the terms of this Agreement;
(b) Refrain from entering into any contracts or other
commitments regarding the Property without the prior written consent of
the Purchaser, which consent shall not be unreasonably withheld; and
(c) Pay and perform all of its obligations under any mortgage
loan secured by the Property.
ARTICLE V
TITLE AND SURVEY
5.1 As evidence of title, Seller agrees, at Seller's sole cost and
expense, to furnish to Purchaser, as soon as possible, but in no event later
than fifteen (15) days following the Effective Date:
(a) A current commitment ("Commitment") from a title insurance
company approved by Purchaser (the "Title Company") to issue to
Purchaser, at Closing, its ALTA Form B Owner's title insurance policy,
without standard exceptions, and containing such endorsements as
Purchaser (or a prudent lender) may require, in the amount of the
Purchase Price, insuring title to the Property to be in good and
marketable condition, free and clear of any liens, encumbrances or
exceptions other than the Permitted Exceptions (defined below); and
(b) A current survey of the Property acceptable to Purchaser,
prepared by a registered land surveyor or engineer in the State of
Michigan satisfactory to Purchaser, certified to Seller, Purchaser, the
Title Company and Purchaser's lender (if any), and prepared in accordance
with the minimum standard detail requirements for land title surveys
established in 1986 as the Standard Detail Requirements of the American
Land Title Association and the American Congress on Surveying and
Mapping. Such survey shall contain such additional information and
certifications as Purchaser or the Title Company shall require. The
survey shall have all corners staked and shall set forth all improvements
and easements existing on the Property as of the date of this Agreement.
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Such survey shall not disclose any encroachments, gaps, overlays or
boundary disputes. The legal description of the Property set forth in
the Commitment shall conform exactly to the legal description set forth
in such survey.
For purposes hereof, "Permitted Exceptions" shall mean those matters to
which the title to the Property shall be subject upon Seller's conveyance
thereof to Purchaser and which matters shall include only (i) such easements
and restrictions of record and applicable zoning ordinances as will not, in
Purchaser's sole judgment, interfere with the use of the Property as a
manufacturing and office facility; (ii) property taxes for the year in which
the Closing Date shall occur; and (iii) such other matters of which Purchaser
may approve in its discretion upon examining the Commitment.
5.2 Purchaser shall notify Seller within fifteen (15) days after the
date of receipt of (i) the Commitment and all legible copies of all underlying
documents disclosed in the Commitment as exceptions (including a copy of the
recorded plat and tax maps of the Property) and (ii) the survey, that the title
is not in the condition required for performance hereunder, or that the terms
of Section 5.1 have not been satisfied. Seller shall have fifteen (15) days
from the time that it is notified of the particular defect claimed to provide
Purchaser with a revised title commitment evidencing that such defect has been
remedied and/or insured over in a manner satisfactory to Purchaser, or a
revised survey, as the case may be. If Seller is unable to obtain such revised
title commitment or revised survey within said fifteen (15) day period,
Purchaser shall have the option (i) to proceed with this transaction, in which
event the warranty deed covering the Property will be executed and delivered
subject to any such defects (provided, however, that in the event any of such
defects result from liens or encumbrances having liquidated amounts which
Seller is not actively contesting through judicial or other similar
proceedings, Purchaser may, at its option, pay such amounts at any time prior
to the Closing Date and shall receive full credit for such payment(s) against
the Purchase Price) or (ii) to cancel this Agreement and be released of any and
all liability hereunder.
ARTICLE VI
SELLER'S WARRANTIES
Each of the representations, warranties, covenants and indemnifications
set forth in the Stock Purchase Agreement dated October 13, 1994 among LVB
Industries, Inc., Seller, Hughes Plastics, Inc. and Purchaser ("Stock Purchase
Agreement") is hereby incorporated herein by reference, effective as of the
Effective Date. Seller acknowledges that Purchaser has relied and shall
continue to rely on such representations, warranties, covenants and
indemnifications in connection with the consummation of the transactions
described herein. Such representations, warranties and covenants shall
continue to be true, complete and correct as of the date of Closing and shall
survive the Closing and the delivery of the Closing Documents. Notwithstanding
the foregoing, the provisions in the Stock Purchase Agreement which limit the
survival of such
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representations, warranties, covenants and indemnifications to five years after
the closing of the Stock Purchase Agreement shall continue to be operative and
binding on Seller and Purchaser under this Agreement.
ARTICLE VII
DEFAULTS
In the event of default by either party hereunder prior to or on the
Closing Date, the non-defaulting party may, at its option (i) cancel this
Agreement, (ii) specifically enforce the terms and conditions of this Agreement
or (iii) exercise any other right or remedy, all of which rights and remedies
shall be cumulative.
ARTICLE VIII
CONDITIONS PRECEDENT TO CLOSING
Anything contained in this Agreement to the contrary notwithstanding,
Purchaser shall have no obligation to consummate this transaction unless the
conditions set forth in this Article VIII shall have either been satisfied or
waived by Purchaser in writing. If not satisfied or waived by the Closing
Date, the Closing Date may, at Purchaser's option, be extended for an
additional 20 days in order that the conditions may be satisfied. In the event
Seller fails to satisfy such conditions by the Closing Date, as extended, and
Purchaser fails to waive an unsatisfied condition, then Purchaser shall have no
obligation to consummate the sale. Such conditions are as follows:
(a) All representations, warranties and covenants of Seller
hereunder shall be true and correct on the Closing Date;
(b) At Closing, the Title Company shall be prepared to issue an
owner's title insurance policy conforming to the requirements of Section
5.1(a) above;
(c) Between the date of this Agreement and the Closing Date,
there shall have been no intervening destruction, damage to, or proposed
or actual condemnation of, the Property or any portion thereof;
(d) Seller shall have performed all of its other obligations
under this Agreement; and
(e) Seller shall not have become insolvent or filed any
petition or permitted the initiation of any judicial or other proceeding
for protection from creditors, bankruptcy,
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arrangement, reorganization, compensation or liquidation under the laws
of the United States, any state or any other jurisdiction.
In the event any of the conditions set forth in items (a), (b), (d) or
(e) above shall fail, such failure shall be treated as a default by Seller
hereunder and shall entitle Purchaser to exercise its rights and remedies
pursuant to Article VII hereof.
ARTICLE IX
CLOSING DOCUMENTS
At Closing, Seller shall execute and deliver to Purchaser (as required)
and Purchaser shall execute and deliver to Seller (as required) the following:
9.1 Seller shall deliver to Purchaser a good and sufficient warranty
deed conveying fee simple, marketable title to the Property to Purchaser,
subject only to the Permitted Exceptions, in form acceptable to Purchaser.
9.2 Seller shall execute and deliver to Purchaser an assignment of the
Contracts which Purchaser has elected to accept assignment of and the
originally executed Contracts. Seller shall indemnify and hold Purchaser
harmless from any liability which shall have accrued under the Contracts prior
to the Closing Date and Purchaser shall indemnify and hold Seller harmless from
any liability which shall accrue under the Contracts accepted by Purchaser on
or after the Closing Date.
9.3 Seller shall execute and deliver to Purchaser an assignment of all
claims, guaranties, warranties, indemnifications and all other rights, if any,
which Seller may have against suppliers, laborers, materialmen, contractors,
subcontractors, architects and engineers arising out of or in connection with
the installation, construction and maintenance of the improvements, fixtures
and personal property on or about the Property, including but not limited to
those arising under the Contracts.
9.4 Seller shall deliver to Purchaser all existing plans,
specifications and as-built drawings in Seller's possession relating to the
Property.
9.5 Seller shall deliver to Purchaser all licenses and certificates of
occupancy or such other comparable certificates or documents issued by the
appropriate governmental authority with respect to the Property or any part
thereof.
9.6 Seller shall execute and deliver a bill of sale covering all
fixtures, equipment and other personal property owned by Seller and used or
usable in connection with the operation of the Property; such bill of sale
shall include the property identified in attached Exhibit B and shall warrant
unencumbered title thereto and that such equipment is in good operating
condition.
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9.7 Seller shall provide and assign to Purchaser all other agreements,
if any, which Purchaser deems necessary for access and utilities to service the
Property.
9.8 Seller shall execute and deliver to Purchaser such affidavit as
the Title Company may require to remove its standard printed exceptions
relating, among other things, to mechanics liens and rights of parties in
possession, and will deliver such receipts, waivers of liens, sworn statements,
indemnifications and the like as may be necessary to evidence the lien free
status of the Property.
9.9 Seller and Purchaser shall execute and deliver to each other a
closing statement showing the amounts by which the Purchase Price shall have
been adjusted as of the Closing Date in the following manner to the extent that
the following are not the obligations of tenant under the Lease:
(a) Purchaser shall receive credit for the premium payable to
the Title Company in the event Seller shall not have theretofore paid
said premium and have furnished a paid receipt therefor to Purchaser.
(b) All real estate taxes and assessments which are a lien
against the Property as of the date of Closing shall be paid in full by
Seller. Current real estate taxes shall be prorated based on the basis
generally utilized in the county in which the Property is located, based
on the number of days the Property is owned by Seller and Purchaser
respectively. In the event the taxing authority has not issued a bill
for the current taxes, the parties shall base their proration on the
amount of taxes for the prior year.
(c) Seller shall pay all real estate transfer taxes and
documentary stamps.
(d) Seller shall pay all water, sewer, utility charges, and
other operating expenditures through the Closing Date. If final readings
have not been taken, estimated charges shall be prorated between the
parties and appropriate credits given, and post-closing adjustments shall
be made when the actual billings are received or an escrow shall be
established to provide for payment of utility and other maintenance
payables.
(e) Any amounts payable by or to the owner of the Property
under any of the Contracts accepted by Purchaser shall be prorated
between the parties and appropriate credits given.
(f) If Seller is a "foreign person" within the meaning of
Section 1445(f)(3) of the Internal Revenue Code ("Code"), Purchaser shall
withhold the appropriate taxes required under Section 1445 of the Code.
9.10 Seller shall furnish Purchaser with an affidavit stating that
Seller is not a "foreign person" within the meaning of Section 1445(f)(3) of
the Code or any successor provision of similar content, in which event the
adjustment described in Section 9.9(f) shall not be made.
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9.11 Seller shall furnish Purchaser with a current "UCC search" of all
state and local records demonstrating the absence of any security interests or
liens on any portions of the improvements or personal property located on the
Property, which shall reasonably satisfy the Purchaser that title to such
personal property and improvements are in the condition required for
performance hereunder.
9.12 Each party shall deliver any and all other documentation
reasonably required by Purchaser, Seller, their attorneys and/or the Title
Company to consummate the transaction described herein and to cause the owner's
title insurance policy described in Section 6.1(a) hereof to be issued and
delivered to Purchaser at Closing.
At Closing, Seller shall deliver actual and complete possession of the
Property to Purchaser.
ARTICLE X
FIRE DAMAGE
In the event that any improvements located upon the Property shall be
damaged or destroyed by fire, storm or other casualty on or before the Closing
Date and the cost to repair such casualty loss shall exceed Twenty Thousand
($20,000.00) Dollars, Purchaser shall have the right to terminate its
obligations under this Agreement within fifteen (15) days after receiving
notice of such casualty. In the event Purchaser shall not be entitled to, or
shall not elect to terminate its obligations under this Agreement, Purchaser
shall be entitled to receive an absolute assignment from Seller of any interest
Seller may have otherwise had in the proceeds of any insurance on the Property
(including any rent loss insurance allocable to the period from and after the
Closing Date) and Seller shall pay to Purchaser at Closing the amount of any
deductible.
ARTICLE XI
CONDEMNATION
In the event that notice of any action, suit or proceeding shall be given
prior to the Closing Date for the purpose of condemning any part of the
Property, Purchaser shall have the right to terminate its obligations hereunder
within fifteen (15) days after receiving notice of such condemnation
proceeding, and upon such termination, the proceeds resulting from such
condemnation shall be paid to Seller. In the event Purchaser shall not elect
to terminate its obligations hereunder, the proceeds of such condemnation shall
be assigned and belong to Purchaser.
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ARTICLE XII
BROKER
Each party represents and warrants to each other that it has not dealt
with a real estate broker or salesperson in connection with the transaction.
Each party agrees to indemnify and hold the other harmless from all loss,
damage, costs and expenses (including attorneys' fees) that the other party may
suffer as a result of any claim brought by any broker or finder with whom such
party may have dealt in connection with this transaction.
ARTICLES XIII
MISCELLANEOUS
13.1 This Agreement and the exhibits attached hereto, the Stock
Purchase Agreement, the Lease and the other documents referenced therein embody
the entire agreement between the parties in connection with this transaction
and there are no oral or parole agreements existing between the parties
relating to this transaction which are not expressly set forth herein and
covered hereby. This Agreement may not be modified except in writing signed by
all parties.
13.2 Failure of either party to complain of any act or omission on the
part of the other party, no matter how long the same may continue, shall not be
deemed to be a waiver by such party of any of its rights hereunder. No waiver
by any party at any time, express or implied, of any breach of any provision of
this Agreement shall be deemed a waiver or a breach of any other provision of
this Agreement or a consent to any subsequent breach of the same or any other
provision. If any action by any party shall require the consent or approval of
another party, such consent or approval of such action on any one occasion
shall not be deemed a consent to or approval of said action on any subsequent
occasion or a consent to or approval of any action on the same or any
subsequent occasion.
13.3 The captions, section numbers and article numbers appearing in
this Agreement are inserted only as a matter of convenience, and do not define,
limit, construe or describe the scope or intent of such sections or articles of
this Agreement nor in any way affect this Agreement.
13.4 No party other than Seller and Purchaser, their heirs, personal
representatives, successors and assigns, shall have any rights to enforce or
rely upon this Agreement, which is binding upon and made solely for the benefit
of Seller and Purchaser, their heirs, personal representatives, successors and
assigns, and not for the benefit of any other party.
13.5 Notice shall be deemed as given hereunder upon personal delivery
to the addresses set forth below or, if properly addressed, two days following
depositing such notice, postage
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prepaid, in a United States mailbox or one day following depositing such notice
in the custody of a nationally recognized overnight delivery service. Notice
shall be deemed properly addressed if sent to the following addresses:
If to Seller: Louis V. Buzzitta and Catherine F. Buzzitta
Suite 602
221 Michigan N.E.
Grand Rapids, Michigan 49503
With a copy to: Richard J. Rankin, Esq.
Suite 602
221 Michigan N.E.
Grand Rapids, Michigan 49503
If to Purchaser: Larizza Industries, Inc.
201 W. Big Beaver
Suite 1040
Troy, Michigan 48084
With a copy to: Patrick T. Duerr, Esq.
Honigman Miller Schwartz and Cohn
2290 First National Building
Detroit, Michigan 48226
13.6 In connection with any litigation arising out of this Agreement,
the prevailing party shall be entitled to recover all of its reasonable
attorneys fees and costs, including all fees and costs incurred prior to and at
all trial and appellate levels.
13.7 Larizza Industries, Inc. has executed this Agreement as
"Purchaser" subject to its right to assign all of its right, title and interest
in this Agreement to an existing entity, an entity to be formed or an
individual. Seller agrees to consummate this transaction with Purchaser's
assignee. Seller consents to the assignment of the Purchaser's rights
hereunder to any such person or entity on or prior to the Closing Date.
13.8 TIME IS OF THE ESSENCE TO THIS AGREEMENT.
13.9 Both parties to this Agreement have participated fully and equally
in the negotiation and preparation hereof. Therefore, this Agreement shall not
be more strictly construed or any ambiguities within this Agreement resolved
against either party hereto.
13.10 This Agreement shall be governed by the laws of the State of
Michigan.
13.11 The execution and delivery of this Agreement by the Purchaser
shall constitute Purchaser's offer to the Seller to acquire the Property upon
the terms and conditions herein set
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forth. Upon the Seller's execution hereof, it shall attach to each copy hereof
which has been executed by the Purchaser, Exhibits A through C herein
described, and shall initial each page of such Exhibits. The Exhibits shall be
subject to approval by Purchaser in the exercise of its sole discretion. This
Agreement shall be effective once the Purchaser and the Seller have executed
the Agreement, attached the Exhibits and initialed each page of the Exhibits.
The date on which the Purchaser initials the Exhibits attached hereto is
referred to as the "Effective Date".
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
WITNESSES: "SELLER"
_____________________ ___________________________________
Louis V. Buzzitta
_____________________
_____________________ ___________________________________
Catherine F. Buzzitta, his wife
_____________________
Date: ________________, ____
"PURCHASER"
LARIZZA INDUSTRIES, INC.,
an Ohio corporation
_____________________ By: _____________________________
______________________
_____________________ Its: ______________________
Date: ________________, ____
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Exhibit List
A Legal Description
B Personalty List
C List of Contracts and Copies of Contracts
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