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LEASE
In consideration of the covenants herein contained, MACNEILL WORLDWIDE,
INC., of 76 Lexington Drive, Laconia, New Hampshire, 03246, hereinafter called
"LESSOR", which expression shall include successors and assigns where the
context so admits, does hereby lease to DM MANAGEMENT COMPANY, having an address
at One Winterbrook Way, Meredith, New Hampshire, 03253, hereinafter called
"LESSEE", which expression shall include successors, executors, administrators
and assigns where the context so admits, and LESSEE hereby lease the following
described premises, hereinafter called the "Leased Premises".
37,800 square feet of industrial/warehouse/distribution space in the newly
expanded MacNeill Worldwide building located at 76 Lexington Drive, Laconia, New
Hampshire. The 37,800 sq. ft. represents the entire portion of the new building
located on the southern end of the overall building and which has a total gross
building sq. ft. of 78,120 sq. ft. The proposed space shall consist of the
entire expansion of the pre-existing MacNeill Worldwide Building and measures
270 ft. long and 140 ft. wide and is outlined on the newly approved MacNeill
Worldwide Site Development Plan, a copy of which is attached hereto. Said
expansion is a duplication of the existing building in terms of basic building
specifications (ceiling height, bay spacing, exterior metal and masonry walls,
etc.). The new building will have at least two (2) loading docks, separated to
the maximum possible, and approximately forty (40) additional parking spaces.
TO HAVE AND HOLD the Leased Premises for a term of two (2) years commencing
on or before April 1, 1997. The Lessor also agrees to provide the option of an
additional one (1) year period. The lease rate for any option period would be
subject to renegotiation. The Lessor and Lessee would be obligated to provide a
180 day notice period to each other. In other words, if the Lessor is going to
need the lease space, the Lessor would give 180 day notice to the Lessee that
the option to renew is not available. Likewise, the Lessee would provide 180 day
notice to the Lessor in the event they elect not to extend for a (1) year
period.
LESSOR and LESSEE now covenant and agree that the following terms and
conditions shall govern this lease during the term hereof and for such further
time as LESSEE shall hold the Leased Premises.
1. BASE RENT AND NOTICE - Lessee shall pay to Lessor the rent at the rate
of Four Dollars and Twenty-five Cents ($4.25) per square foot for an area of
approximately 37,800 sq. ft. or a total rent of $160,650 per year. However, the
Lessor has offered the option to the Lessee that a base rent of Four Dollars and
Ten Cents ($4.10) per square foot, a total of $154,980 per year, if the said
rent for each year is paid in advance with the first year being due at the
execution of this Lease and the second year due on or before April 1, 1998.
Lessor has opted for the rent to be paid one (1) year in advance. Said rent in
the amount of $154,980 shall be paid prior to occupancy less the deposits made
at the time of signing the "LETTER OF INTENT" and "AGREEMENT TO LEASE AND
DEPOSIT RECEIPT".
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All payments are to be made to LESSOR. MACNEILL WORLDWIDE, INC. At 76
LEXINGTON DRIVE, LACONIA, NEW HAMPSHIRE 03246.
2. SECURITY DEPOSIT: An additional deposit equivalent to two (2) month's
rent will be due, or $26,775.00, upon execution of this Lease. Since the rent is
to be paid in advance on a yearly basis, there will be no security deposit
required.
3. USE OF PREMISES: Lessee shall use the Leased Premises for the purpose of
storage and distribution of dry goods (clothing) or any uses associated with
such an operation.
4. ADDITIONAL RENT: The Lessee shall be responsible for all expenses
associated with the space with the exception of structural maintenance only. In
other words, this lease is a triple net lease or (absolute lease) with the
Lessee paying the real estate taxes, insurance, all utilities, grounds
maintenance, snow removal, and any other expenses incidental maintaining the
premises and such expenses shall constitute additional rent. In the case of
utilities, the Lessee shall arrange direct service from the appropriate vendors
and pay such obligations directly to said vendor. In the case of real estate
taxes, the Lessor shall bill the Lessee upon receipt of tax bills from the City
and these will be due approximately at the end of the third and the ninth month
of the term of said lease. The Insurance obligation for that portion of the
building occupied by the Lessee shall also be billed at the same time as the
real estate taxes or in other words, two billings during the lease period. The
snow removal, grounds maintenance and other incidental expenses shall be billed
monthly.
5. UTILITIES - As stated above under additional rent, the Lessee shall be
responsible for the expense of electricity and any electrical improvements
necessary to accommodate Lessee's operations.
6. COMPLIANCE WITH LAWS - Lessee acknowledges that no trade or occupation
shall be conducted on the Premises or use made thereof which will be unlawful,
improper, noisy or offensive, or contrary to any state or federal law or any
municipal ordinance in force during the term hereof.
7. FIRE INSURANCE - Lessee shall not permit any use of the leased Premises
which will cause or increase in the Lessor's insurance premium or make voidable
any insurance on the property of which the Premises are a part, or on the
contents of said property or which shall be contrary to any law or regulation
from time to time established by the New England Insurance Rating Association,
or any similar body. Lessee shall, on demand, reimburse Lessor, all extra
insurance premiums caused by Lessee's use of the Premises.
8. MAINTENANCE OF PREMISES - Lessee shall be responsible for the
maintenance of the space that they occupy and any common areas specifically
limited to their leased space.
9. IMPROVEMENTS - Lessor agrees to construct said 37,800 sq. ft. expansion
and to install and complete certain improvements, as outlined in AGREEMENT TO
LEASE AND DEPOSIT RECEIPT, dated December 20, 1996, to the satisfaction of the
Lessee in accordance to the terms
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and conditions outlined therein. (Copy of Agreement is attached as Appendix A.).
10. ASSIGNMENT - SUBLEASING - Lessee shall not assign or sublet the whole
or any part of the Premises without Lessor's prior written consent not to be
unreasonably withheld. In the event a sublease is consented to, Lessee will
remain liable to Lessor for the payment of all rent and for the full performance
of the covenants and conditions of this lease.
11. SUBORDINATION - Only insofar as additional rent for expenses over and
above the base rent, shall this Lease be subject and subordinate to any and all
mortgages and other instruments in the nature of a mortgage, now or at any time
hereafter and Lessee shall, when requested, promptly execute and deliver such
written instruments as shall be necessary to show the subordination of this
lease to said mortgages or other such instruments in the nature of a mortgage
insofar as any additional rent obligation, but this shall not apply to the base
rent which has, in fact, been paid in advance.
12. LESSOR'S ACCESS - Lessor or agents of Lessor may at reasonable times
enter to view the Premises and may remove any signs not approved and affixed as
herein provide, and may make repair and alterations as Lessor should elect to do
and repairs which Lessee is required but has failed to do. Said Lessor's access
shall also provide for limited and reasonable access to the mezzanine area
retained within the demised premises.
13. INDEMNIFICATION AND LIABILITY - Lessee shall save Lessor harmless from
all claims for loss or damage occasioned by the use or escape of water from the
Premises leased by Lessee, as well as from any claim or damage resulting from
neglect of Lessee, or by any nuisance made or suffered on the Premises
excepting, however, damage caused by Lessor's negligence. The removal of snow
and ice from the walkways, steps, loading areas, parking lots and access roads
to the Premises shall be Lessor's responsibility. The provisions of this
paragraph shall be made expressly subject to the provisions of a reciprocal
waiver of subrogation.
14. LESSEE'S LIABILITY INSURANCE - Lessee shall be solely responsible as
between Lessor and Lessee for deaths or personal injuries to all persons
whomsoever occurring on the Premises from whatever cause arising and damage to
property to whosoever belonging arising out of the use, control, condition or
occupation of the Premises by Lessee; and Lessee agrees to indemnify and save
harmless Lessor from any and all liability, reasonable expenses, damage causes
of actions, suits, claims or judgments caused by or in any way growing out of
any matters aforesaid, except for death, personal injuries or property damage
directly resulting from a negligent act or acts on the part of Lessor; and
Lessee will secure and carry out at its own expense a public liability policy
insuring it and Lessor against any claims based on bodily injury (including
death) arising out of the condition of the Premises or their use by Lessee; such
policy to insure Lessee and Lessor against any claim up to Five Hundred Thousand
Dollars ($500,000.00) in the case of one person and up to One Million Dollars
($1,000,000.00) in the case of any one accident involving bodily injury
(including death) to more than one person, and insuring Lessor and Lessee
against any claims for damage to property up to an amount of One Hundred
Thousand Dollars ($100,000.00). Lessee will
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promptly file with Lessor certificates showing that such insurance is in force
and thereafter within thirty (30) days prior to the expiration of any such
policies. All such insurance certificates shall provide that such policies shall
not be canceled without at least ten (10) days prior written notice to each
assured named therein.
15. FIRE, CASUALTY - EMINENT DOMAIN - Should a substantial portion of the
Premises, or of the property of which they are a part, be substantially damaged
by fire or other casualty, or be taken by eminent domain, Lessor may elect to
terminate this lease. When such fire casualty, or taking renders the Premises
substantially unsuitable for their intended use, a just and proportionate
abatement of rent shall be made and Lessee may elect to terminate this lease if:
a. Lessor fails to give written notice within thirty (30) days of
intention to restore the Premises, or
b. Lessor fails to restore the Premises to a condition substantially
suitable for their intended use within ninety (90) days of said fire,
casualty or taking.
Lessor reserves, and Lessee grants to Lessor, all rights which Lessee may
have for damages or injury to the Premises for any taking by eminent domain,
except for damage to Lessee's fixtures, property or equipment or other damages
specifically allocated to Lessee by any taking authority.
16. DEFAULT AND BANKRUPTCY - The provisions of this paragraph shall not
apply insofar as rent is concerned, as the full rent has been paid to Lessor
upon execution of said Lease. However, insofar as any additional rent obligation
created by ongoing monthly expenses which constitute additional rent, then, in
the event that:
a. Lessee shall be declared bankrupt or insolvent according to law, or
if any assignment shall be made of Lessee's property for the benefit of
creditors; or
b. Lessee shall default in the payment of any additional rent or other
sums herein specified and such default shall continue for ten (10) days
after written notice thereof; or
c. Lessee shall default in the observance or performance of any other
of Lessee's covenants, agreements, or obligations hereunder and such
default shall not be corrected within thirty (30) days after written notice
thereof;
Then Lessor shall have the right thereafter while such default continues,
to re-enter and take complete possession of the Premises, to declare the term of
this lease ended, and remove Lessee's effects, without being deemed guilty of
any manner of trespass and without prejudice to any remedies which might be
otherwise used for arrears of additional rent or other default or breach of
covenants, Lessee shall indemnify Lessor against all loss of additional rent and
other payments which Lessor may incur by reason of such termination during the
residue of the term.
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If Lessee shall default, after reasonable notice thereof, in the observance
or performance of any conditions or covenants on Lessee's part to be observed or
performed under or by virtue of any of the provisions in any article of this
lease, lessor, without being under any obligation to do so and without thereby
waiving such default, may remedy such default to the account and at the expense
of Lessee. If the payment of money in connection therewith, including but not
limited to reasonable attorney's fees in instituting, prosecuting or defending
any action or proceeding, such sums paid or obligations incurred, shall be paid
to Lessor with interest at the rate of one and one-half percent (1.5%) per month
by Lessee.
17. NOTICE - Any notice from Lessor to Lessee relating to the Premises or
to the occupancy thereof shall be deemed duly served, if mailed to Lessee (DM
MANAGEMENT COMPANY, One Winterbrook Way, Meredith, NH, 03253) by registered or
certified mail, return receipt requested, postage prepaid. Any notice from
Lessee to Lessor relative to the Premises or to the occupancy hereof, shall be
deemed duly served, if mailed to Lessor by registered or certified mail, return
receipt requested, postage prepaid, addressed to Lessor at such address as
Lessor has last designated.
18. ACCESS, PARKING AND USE OF COMMON AREAS - Lessee will not obstruct in
any manner any portion of the building not hereby leased, including driveways
and approaches to said building, the shipping/receiving area, and the truck
docks and will conform to all reasonable rules now or hereafter made by Lessor
concerning the use of common areas and for the care and use of the building, its
facilities and approaches. Lessee further warrants that Lessee will not permit
any employ to violate this or any other covenants or obligation of Lessee and
will take reasonable steps to prevent violation by its invitees. Lessee shall
have the right to park necessary vehicles in the front of the demised space.
19. FIRE PREVENTION - Lessee agrees to provide and maintain approved,
labeled fire extinguishers within the Premises as recommended by the New England
Insurance Rating Association for protective credit.
20. USE OF COMMON AND OUTSIDE AREAS - No goods or things of any type or
description shall be held or stored outside of the Premises or in a common area
for longer than four (4) hours without the express written approval of Lessor.
Lessee shall be responsible for disposal and removal of their own trash.
21. RESPONSIBILITY - Lessor shall not be held liable to anyone for the
cessation of any service rendered customarily to said Premises or building
agreed to by the terms of this lease, due to any accident, to the making of
repairs, alterations or improvements, to labor difficulties, to mechanical
breakdowns, to trouble in obtaining fuel, electricity, service or supplies from
the sources from which they are usually obtained for said building or to any
cause beyond the Lessor's immediate control. Notwithstanding the foregoing, any
repairs or alterations to the Premises made by Lessor shall not unduly interfere
with Lessee's use and enjoyment of same.
22. ENVIRONMENT - Both Lessor and Lessee agree to maintain efficient and
effective devices for preventing and eliminating any odors or interfere with the
use and enjoyment of other portions of buildings by others by reasons of odors,
noise, accumulation of garbage or trash, vermin
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or other pests or otherwise. Insofar as appropriate for any permits necessary to
accommodate the Lessee's use, Lessee acknowledges that it is solely responsible
for the acquisition of such permits
prior to commencing operations for such permits which may be required by any
governmental unit or agency.
23. SURRENDER - Lessee shall, at the expiration or other termination of
this lease, remove all of Lessee's goods and effects from the Premises. Lessee
shall deliver to Lessor the Premise and all keys, locked thereto, and other
fixtures connected therewith and all alterations and additions made to or upon
the Premises, broom clean and in the same condition as they were at the
commencement of the term, or as they were put in during the term hereof
reasonable wear and tear and damage by fire or other casualty excepted. In the
event of Lessee's failure to remove any of Lessee's property from the Premises,
Lessor is hereby authorized, with liability to Lessee for loss or damage thereto
and at the sole risk of Lessee, to remove and store any property at Lessee's
expense, or to retain same under Lessor's control or to sell at public or
private sale, without notice, any or all of the property not so removed and to
apply the net proceeds of such sale to the payment of any sum due hereunder or
to destroy such property.
24. WAIVERS - No consent or waiver, express or implied, by Lessor, to or of
any breach of any covenant, condition or duty of Lessee, shall be construed as a
consent or waiver to or of any other breach of the same or any other covenant,
condition or duty. If Lessee is several person or a Partnership, Lessee's
obligations are joint or partnership and also several. Unless repugnant to the
context, Lessor and Lessee mean the person or persons, natural or corporate,
named above as Lessor and Lessee respectively, and their respective heirs,
executors, administrators, successors and assigns.
25. ADDITIONAL PROVISIONS - All movable trade fixtures and racking devices
installed by Lessee in the premises shall remain the property of the Lessee and
shall be removable from time to time prior to the expiration of the lease or
upon expiration of the lease.
26. HAZARDOUS WASTE - A "hazardous substance" is any petroleum product,
asbestos product, or other material, substance or waste which is recognized as
being hazardous or dangerous to health or the environment of any federal, state,
or local agency having environmental protection jurisdiction over the Premises.
Lessor and Lessee agree not to generate, store, handle or dispose of any
hazardous substance in or upon the Premises during the term of this Lease. In
the event, however, that any substance currently used in Lessor's or Lessee's
business during the Lease term is or shall become designated a hazardous
substance, Lessor or Lessee shall, to the extent practicable, discontinue the
use of the substance on the Premises. If not practicable, for Lessor or Lessee
to discontinue such use, then Lessor or Lessee agree that it will only continue
the use of the hazardous substance on the Premises in a manner consistent with
all standards and regulations for safe use of such hazardous substance
promulgated by governmental agencies having jurisdiction. Lessee shall indemnify
and hold Landlord harmless from and against any and all demands, claims,
enforcement actions, costs and expenses, including reasonable attorney's fees,
arising out of the breach of this paragraph by Lessee and Lessor shall hold
Lessee likewise harmless in the event that
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the Lessor is the generator of the hazardous waste.
27. HOLDING OVER: If LESSEE holds over or remains in possession of the
Leased premises after the expiration of the original term of this Lease or any
renewal term, without Lessor's prior written consent, Lessor may at Lessor's
option: (1) deem such hold over a renewal of this Lease for a 1 year term under
the same terms, covenants and conditions, or (2) Lessor may take such steps as
may be required to remove Lessee from the Leased premises and until Lessee
vacates or is removed from the Leased Premises, Lessor shall be entitled to
payment from Lessee of rent for each month or fraction of a month during which
Lessee hold over.
28. NOTICE TO QUIT: LESSEE waives notice to quit and agrees to surrender
the Leased Premise, at the expiration of said term, or the termination of this
Lease or any renewal thereof, without any notice whatsoever.
29. MERGER: This Lease contains the entire agreement between the parties
and no agreement shall be effected to change, modify or terminate this Lease in
whole or in part unless such is in writing and duly signed by the party against
who enforcement of such change, modification or termination is sought. Lessee
acknowledges that it is not relying on any representations or promises of the
Lessor, or of any agent of the Lessor, except as may be expressly set forth in
this Lease.
30. PARTIAL INVALIDITY: If any term, covenant or condition of this Lease or
the application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Lease or the application of such
term, covenant or condition to the persons or circumstances other than those as
to which it is held invalid or unenforceable, shall not be effected thereby and
each term, covenant or condition of this Lease shall be valid and be enforced to
the fullest extent permitted by law.
31. PARAGRAPH HEADINGS: The paragraph headings as to the content of
particular paragraphs herein are inserted only for convenience and are in no way
to be construed as part of such paragraph or as a limitation on the scope of the
particular paragraph to which they refer.
The conditions and terms of the lease and building specifications other
than hereinabove provided shall be subject to the mutual approval of the Lessee
and Lessor.
IN WITNESS WHEREOF, Lessor and Lessee have hereunto set their hands and
common seals this 21 day of February, 1997.
In presence of: MACNEILL WORLDWIDE, INC., LESSOR
/s/Kent D. Locke Jr. BY: /s/ Jeffrey M. Dow
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Witness Its: President
DM MANAGEMENT COMPANY,
LESSEE
/s/ Stephen W. Lord By: /s/ Samuel L. Shanaman
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Witness Its: V.P.