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EXHIBIT 10.60
LEASE AGREEMENT
LEASE AGREEMENT ("AGREEMENT" or "LEASE") dated the ____day
of_________, 1998 made by and between KIMCO AUTOFUND, LP, a Delaware Limited
Partnership, having an office at 3333 New Hyde Park Road, New Hyde Park, New
York (hereinafter called "LANDLORD") and FRANKLIN FORD MERCURY, INC., a Georgia
corporation having an office at Suite 250, Bldg. B, 5901 Peachtree Dunwoody
Road, Atlanta, GA 30328 (hereinafter called "TENANT").
STATEMENT OF FACTS
Landlord is the fee owner of that certain real property situated in
the State of North Carolina, more fully described in Exhibit A annexed hereto
and by this reference made a part hereof. Landlord desires to lease to Tenant,
and Tenant desires to hire from Landlord, those certain plots, pieces and
parcels of land described on Exhibit A (hereinafter called the "LAND") together
with the building and other structures located thereon thereinafter called the
"IMPROVEMENTS") (the Land and Improvements are hereinafter called the "LEASED
PREMISES").
All capitalized terms used in this Lease, not otherwise defined, shall
have the meanings ascribed to them in Article 42.
NOW, THEREFORE, in consideration of Ten ($10.00) Dollars, each to the
other in hand paid, and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, Landlord and Tenant hereby
agree as follows:
ARTICLE 1
DEMISE; TERM
1.1 Landlord hereby leases the Leased Premises to Tenant, and Tenant
hereby hires the Leased Premises from Landlord, upon, and subject to, the
terms, covenants and conditions contained in this Lease.
1.2 The initial Term of Tenant's leasehold estate in and to the Leased
Premises shall be for a period of approximately eighteen (18) years, commencing
upon the date hereof (hereinafter called the "COMMENCEMENT DATE") and expiring
on the eighteenth anniversary of the last day of the month in which the
Commencement Date occurs (hereinafter called the "EXPIRATION DATE"), unless
this Lease shall sooner terminate or expire as hereinafter provided.
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1.3 Landlord grants to Tenant the options (the "EXTENSION OPTIONS") to
extend the Term of this Lease for five (5) additional terms of five (5) years
each (the "OPTION TERMS") upon and subject to the terms and conditions set
forth in this Section 1.3. Each Extension Option shall be exercised, if at all,
by written notice given to Landlord at least twelve (12) months prior to the
then scheduled Expiration Date of the Term of this Lease, in which case the
expiration date for the applicable Option Term shall become the Expiration Date
for the Term of this Lease. Anything contained herein to the contrary, an
Extension Option may not be exercised if an Event of Default (as hereafter
defined) exists and is continuing at the time Tenant exercises such Extension
Option or at the commencement date of the additional Term resulting from the
exercise of such Option.
ARTICLE 2
FIXED NET RENT; ADDITIONAL RENT; CPI RENT
2.1 Tenant covenants and agrees to pay to Landlord a "FIXED NET RENT"
under this Lease for each Lease Year during the Term equal to the sum of:
(a) For the first five (5) Lease Years, Fixed Net Rent for the
Leased Premises shall be at the rate of Two Hundred Fifty-Two Thousand Five
Hundred ($252,500) per annum; after the fifth Lease Year Fixed Net Rent shall
be the sum of the Fixed Net Rent for the first Lease Year; plus
(b) The amount of any CPI Rent (as such term is defined in Section
2.4) payable by Tenant to Landlord with respect to such Lease Year pursuant to
the terms of Section 2.6 below. The Fixed Net Rent shall be paid by Tenant to
Landlord in equal monthly installments in advance on the Commencement Date and
on the first day of each and every month thereafter during the Term of this
Lease at Landlord's office, or at such other place and/or to such agent as
Landlord may designate by notice to Tenant, in lawful money of the United
States of America. The first and last installments of Fixed Net Rent payable
under this Lease shall be suitably prorated, if applicable.
2.2 All such sums, charges, costs, expenses and other sums of money
(other than the Fixed Net Rent) as Tenant shall agree to pay under, or pursuant
to, this Lease shall be deemed to be "ADDITIONAL RENT" hereunder, for default
in the payment of which (which default remains uncured after any applicable
notice or grace period) Landlord shall have the same remedies as for a default
in the payment of Fixed Net Rent.
2.3 Tenant shall pay the Fixed Net Rent reserved herein, as well as
the items of additional rent assumed or payable by Tenant pursuant hereto or
hereunder, promptly, without demand therefor, and without any abatement,
setoff, or deduction of any kind whatsoever.
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2.4 For purposes of this Article 2, the following terms shall have the
respective meanings ascribed to them below:
(a) "PRICE INDEX" shall mean, subject to the terms of Section 2.7,
"The Consumer Price Index" for All Urban Consumers (CPI-U)-U.S. City Average,
All Items (1982-84 = 100), issued by the Bureau of Labor Statistics of the
United States Department of Labor;
(b) "CPI COMPUTATION PERIOD" shall mean the period commencing on
the Commencement Date and expiring on the last day of the month in which shall
occur the day preceding the fifth anniversary of the Commencement Date, and
each consecutive five year period thereafter occurring during the balance of
the Term;
(c) "BASE PRICE INDEX" shall mean the Price Index as it exists on
the Commencement Date;
(d) "PERCENTAGE OF CPI INCREASE" shall mean, with respect to each
CPI Computation Period occurring during the Term after the expiration of the
first CPI Computation Period, the percentage, if any, by which the Price Index
existing as of the last day of the prior CPI Computation Period exceeds the
Base Price Index; and
(e) "CPI RENT" shall mean, with respect to each year occurring
during the Term after the expiration of the first CPI Computation Period, an
amount computed by multiplying:
(i) the then aggregate rent for all properties comprising the
Leased Premises with respect to the immediately preceding CPI Computation
Period; by
(ii) the Percentage of CPI Increase with respect to the last
day of the CPI Computation Period in which such year occurs, provided however
that the Percentage of CPI Increase shall not exceed the rate of 3% per annum
for the applicable CPI Computation Period.
2.5 After the expiration of each CPI Computation Period occurring
during the Term and the publication of the appropriate Index, Landlord shall
send a written notice (hereinafter called a "CPI NOTICE") to Tenant, setting
forth the Base Price Index, the Price Index existing as of the last day of the
expired CPI Computation Period, the Percentage of CPI Increase with respect to
the then current CPI Computation Period and the CPI Rent payable by Tenant to
Landlord for each year during the then current CPI Computation Period. Every
CPI Notice given by Landlord shall be conclusive and binding upon Tenant,
unless Tenant shall:
(a) notify Landlord within thirty (30) days after its receipt of
such notice that it disputes the correctness of the computations made thereon,
specifying the particular respects in which such computations are claimed to be
incorrect; and
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(b) submit its dispute to arbitration, in the manner provided in
Article 21, within ninety (90) days after its receipt of the disputed CPI
Notice, if such dispute shall not theretofore be settled by agreement.
Pending the resolution of such dispute by agreement or arbitration as
aforesaid, Tenant shall commence to pay the CPI Rent set forth in such CPI
Notice, but such payment shall be without prejudice to Tenant's position.
2.6 In consideration of the length of the Term of this Lease, Tenant
shall pay to Landlord as a part of the Fixed Net Rent reserved in this Lease,
with respect to each year occurring after the expiration of the first CPI
Computation Period, the annual CPI Rent applicable during the CPI Computation
Period in which such year occurs, which applicable annual CPI Rent shall be
payable in equal monthly installments in advance. In the event that, following
the commencement of any CPI Computation Period (other than the first CPI
Computation Period), the CPI Rent payable by Tenant during such CPI Computation
Period shall not have been fixed in a CPI Notice given by Landlord to Tenant,
Tenant shall continue to pay the monthly installments on account of the CPI
Rent, if any. applicable during the preceding CPI Computation Period and,
within ten (10) days after the receipt of a CPI Notice. Tenant shall pay the
CPI Rent for each month prior to the month following the giving of such notice.
2.7 In the event that the Price Index ceases to use the 1982-84
average of 100 as the basis of calculation, or if a substantial change is made
in the term of, or items contained in, the Price Index, the Price Index shall
be adjusted to the figure that would have been arrived at had the change in the
manner of computing the Price Index in effect as of the Commencement Date not
occurred. In the event that such Price Index (or a successor or substitute
index) is not available, a reliable governmental or other non-partisan
publication evaluating the information theretofore used in determining the
Price Index shall be used.
2.8 Landlord's failure to prepare and deliver a CPI Notice with
respect to any period, or Landlord's failure to make a demand, shall not in any
way cause Landlord to forfeit or surrender its rights to collect the CPI Rent
payable hereunder, provided no adjustment in CPI rent shall be made more than
24 months after the year in question.
ARTICLE 3
IMPOSITIONS AND CHARGES
3.1 Tenant shall, as additional rent, pay and discharge:
(a) all real estate taxes, assessments, water charges, water meter
charges (including, without limitation, any expenses incident to the
installation, repair or replacement of any water meter), sewer rents, sewer
charges and all other charges, taxes, rents, levies and sums of every kind or
nature whatsoever, extraordinary as well as ordinary, whether
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or not now within the contemplation of the parties, as shall, during the Term,
be imposed by any governmental public authority upon, or become a lien in
respect of, the Leased Premises, any Improvement situated on the Leased
Premises, or any part thereof, or upon any sidewalk or street in front of or
adjacent to the Leased Premises, or that may become due and payable with
respect thereto, and any and all taxes, assessments and charges levied,
assessed, or imposed upon the Leased Premises in lieu of, or in addition to,
the foregoing, under or by virtue of any present or future laws, rules,
requirements orders, directives, ordinances, or regulations of the United
States of America, or of the State, County, Town, Village, or City government,
or of any municipal bureau, department, or other lawful authority whatsoever;
(b) all charges for fire alarm service, gas, electricity, steam
and all other public utility or similar service or services furnished during
the Term to the Leased Premises, any Improvement situated on the Leased
Premises, or any part thereof, all fees and charges of the Federal, State,
County, Town, Village, or City government, or of any municipal bureau,
department, or other lawful authority whatsoever, for the construction,
maintenance or use of any street or sidewalk adjacent to the Leased Premises
and all fees and charges for the construction, maintenance, use, or occupancy,
during the Term, of the Leased Premises, any Improvement now or hereafter
situated on the Leased Premises, or any part thereof; and
(c) all taxes and assessments that shall or may, during the Term,
be charged, levied, assessed, or imposed upon, or become a lien upon, the
personal property of Tenant used in connection with the operation of the Leased
Premises, any Improvement situated on the Leased Premises, or any part thereof,
or in connection with Tenant's business conducted thereon or therein.
Nothing herein contained shall be construed so as to require Tenant to pay, or
be liable for any gift, inheritance, estate, franchise, income, profits,
capital, or similar tax imposed upon Landlord, unless such tax shall be imposed
or levied upon, or with respect to, the rents payable to Landlord hereunder in
lieu of one or more of the charges or impositions described in subsection (a),
(b) and/or (c) above, in which event Tenant covenants and agrees to pay such
tax as if the Leased Premises were the only property owned by Landlord.
3.2 Tenant shall be deemed to have complied with the requirements of
Section 3.1 if Tenant shall:
(a) pay each such imposition or charge prior to the expiration of
the period within which payment is permitted without penalty or interest;
(b) promptly procure an official receipt from the appropriate
taxing authority, if available, or other evidence of payment, evidencing each
such payment; and
(c) within forty-five (45) days after the expiration of the
payment period described in subsection (a) above, and upon Landlord's request
therefor, exhibit to
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Landlord such official receipt, or such other evidence of payment as Landlord
shall reasonably request.
In the event that, at any time during the Term of this Lease, either:
(i) Tenant shall fail to pay any such imposition or charge as
and when provided in subsection (a) above;
(ii) Tenant shall fail to deliver to Landlord any receipt or
other evidence of payment required to be delivered to Landlord pursuant to the
term of subsection (c) above on or before the date when the same is required to
be delivered pursuant to the terms thereof;
(iii) any of the events set forth in subsections (a) through
(e) of Section 15.1 shall occur; and/or
(iv) an Event of Default (as such term is defined in Section
16.1) shall occur,
then, notwithstanding anything to the contrary provided in this Section 3.2,
Landlord shall have the right, at Landlord's option and in addition to all
other rights and remedies that shall be available to Landlord as a result
thereof, to require Tenant to:
(x) promptly deposit with Landlord funds for the payment of
all then current impositions and charges of the nature described in Section 3.1
required to be paid by Tenant hereunder; and
(y) also, to the extent Landlord is required to do so by an
institutional lender or lenders holding a mortgage on any portion of the Leased
Premises, deposit one-twelfth (1/12) of the current impositions and charges
(with respect to such portion), as estimated by Landlord but in no event less
than those of the preceding year(s) if the current amount(s) thereof have not
been fixed, on the first day of each month in advance, except that all
additional funds required for any payments thereof shall also be deposited as
aforesaid on the first day of the final month during which, or at the end of
which, a payment is due and payable without interest or penalty.
3.3 In any action or proceeding involving any question arising under
the provisions of this Article 3, a search, certificate, or receipt made or
given by any person or entity legally authorized to make or give the same,
certifying or showing, or purporting to certify or show, that any charge or
imposition referred to in this Article 3 is due and payable on the date of said
search or certificate, or has been paid as of the date of such receipt, shall
be prima facie evidence that such charge or imposition was due and payable, a
lien upon, or a charge against, the Leased Premises or the Improvements, or
paid, as the case may be, Landlord or Tenant shall
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be protected in any action that it may take in reliance upon any such
certificate, search, or receipt.
3.4 Tenant may, at its own expense, contest in good faith and by
appropriate proceedings, any tax, assessment, imposition or charge referred to
in this Article 3, and to appeal any adverse determination, provided that
Tenant shall have deposited with the fee mortgagee with respect to the Leased
Premises (or, if the Leased Premises are not subject to a fee mortgage, with a
national title insurance company designated by Landlord), if Landlord so
requires the amount of the item so contested (or, where permitted by law, paid
the same under protest), together with such additional sums as may reasonably
be required to cover interest or penalties accrued and to accrue on any such
item or items, and provided further, that no Event of Default shall have
occurred and be continuing under the terms of this Lease. Any refund obtained
by Tenant or Landlord (net of recovery costs) on account of taxes paid by
Tenant shall be Tenant's sole property. If such contest involves real estate
taxes, any additional taxes, interest, court costs, penalties and/or other
charges directed to be paid as a result of such contest shall be forthwith
deposited by Tenant with the fee mortgagee or title company (as the case may
be), if Landlord so requires, to enable Landlord to comply with the
adjudication of said contest. Nothing herein contained, however, shall relieve
Tenant of the obligation and duty to pay and discharge such contested items, as
finally adjudicated, with interest and penalties, and all other charges
directed to be paid in or by any such adjudication, less such sums as shall
have been deposited as aforesaid. Any such contest or legal proceeding shall be
begun by Tenant as soon as reasonably possible after the imposition of any
contested item and shall be prosecuted to final adjudication with all
reasonable promptness and dispatch except, however, that Tenant may, in its
discretion, consolidate any proceeding to obtain a reduction in the assessed
valuation of the Leased Premises and the Improvements for real estate tax
purposes relating to any tax year with any similar proceeding or proceedings
relating to one or more other tax years. Anything to the contrary herein
notwithstanding, Tenant shall pay all such contested items before the time when
the Leased Premises or any part thereof might be forfeited as a result of
nonpayment.
3.5 At the commencement and expiration of the Term, all impositions
and charges referred to in this Article 3 for the period or periods in which
the Commencement Date or the Expiration Date (as the case may be) shall occur
whether accrued or prepaid (as the case may be), shall be apportioned between
Landlord and Tenant in accordance with the usual practice and custom then in
effect in the City, County and State where each property comprising the Leased
Premises is located.
3.6 If, by law, any assessment for a public improvement with respect
to the Leased Premises or any Improvements situated thereon is payable, at the
option of the taxpayer, in installments, Tenant may, whether or not interest
shall accrue on the unpaid balance thereof, pay the same, and any accrued
interest or any unpaid balance thereof, in installments, as each installment
becomes due and payable, but in any event before any fine, penalty, interest,
or cost may be added thereto for non-timely payment of any installment or
interest.
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ARTICLE 4
SUBORDINATION
4.1 Subject to the terms and conditions contained herein, this Lease
is subject and subordinate to all ground, overriding, or underlying leases, as
well as, at the election of the holder of any such lease or mortgage, to all
mortgages that may now or, subject to the provisions of Sections 4.2 and 4.3
below, hereafter affect such leases or the Leased Premises, and to all
renewals, modifications, consolidations, replacements and extensions of any
such leases and/or mortgages. This Section 4.1 shall be self-operative, and no
further instrument of subordination shall be required by any such ground or
underlying lessor or mortgagee who so elects. In confirmation of such
subordination, Tenant shall execute promptly any reasonable certificate that
Landlord, or any such lessor or mortgagee, may request.
4.2 Landlord shall use diligent, good faith efforts to obtain a
non-disturbance agreement substantially in the form hereinafter described from
any existing mortgagees, but the failure to obtain the same shall not be a
Landlord default, so long as Landlord uses good faith, diligent efforts.
Landlord represents to Tenant that as of the date of this Lease there are no
ground, overriding or underlying leases affecting the Leased Premises which are
superior to this Lease. The subordination of this Lease to ground, overriding,
or underlying leases entered into after the date of this Lease is subject to
the express conditions that, so long as this Lease shall be in full force and
effect in the event of termination of the term of any such ground, overriding,
or underlying lease by reentry, notice, summary proceedings or other action or
proceeding, or if the term of such ground, overriding, or underlying lease
shall otherwise or expire before the termination or expiration of the Term of
this Lease:
(a) Tenant shall not be made a party to any action or proceeding
to remove or evict Tenant or the tenant under such ground, overriding, or
underlying lease, or to disturb its possession by reason of, or based upon,
such termination or expiration of the term of such ground, overriding, or
underlying lease; and
(b) this Lease shall continue in full force and effect as a direct
lease between Tenant and the then owner of the fee or the less or of such
ground, overriding, or underlying lease, as the case may be, upon all of the
obligations of this Lease, except that said owner or lessor shall not:
(i) be liable for any previous act or omission of any prior
landlord (including Landlord) under this Lease;
(ii) be subject to any offset that shall have theretofore
accrued to Tenant against Landlord; or
(iii) be bound by:
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(x) any previous modification of this Lease, not
expressly provided for in this Lease, where Tenant shall have, prior to such
modification, received notice of such ground, overriding, or underlying lease;
or
(y) any previous prepayment of more than one month's
fixed rent or any additional rent then due,
unless such modification or prepayment shall have been expressly approved in
writing by the owner of the fee or lessor of the superior lease.
4.3 The subordination of this Lease to the liens of mortgages granted
or modified by Landlord after the date of this Lease is subject to the express
conditions that, so long as this Lease shall be in full force and effect:
(a) Tenant shall not be named or joined in any action or
proceeding to foreclose any such mortgage;
(b) such action or proceeding shall not result in a cancellation
or termination of the Term of this Lease:
(c) if the holder of any such mortgage becomes the owner of the
fee or the assignee of any ground or underlying lease referred to in Section
4.1, or the lessee of any other lease given in substitution therefor, or if the
Land or the Improvements shall be sold as a result of any action or proceeding
to foreclose such mortgage, this Lease shall continue in full force and effect
as a direct lease between Tenant and the then owner of the fee, the then lessee
of such ground, overriding, or underlying lease, the lessee of any other lease
given in substitution therefor, or such purchaser of the Land or Building. as
the case may be, upon all of the obligations of this Lease, except that such
owner, lessee, or purchaser shall not:
(i) be liable for any previous act or omission of any prior
landlord (including Landlord) under this Lease:
(ii) be subject to any offset, not expressly provided for in
this Lease, that shall have theretofore accrued to Tenant against Landlord; or
(iii) be bound by:
(x) any previous modification of this Lease where
Tenant shall have, prior to such modification, either received notice of such
mortgage; or
(y) any previous prepayment of more than one month's
fixed rent or any additional rent then due,
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unless such modification or prepayment shall have been expressly approved in
writing by the holder of the superior mortgage through, or by reason of which,
such owner, lessee, or purchaser shall have succeeded to the rights of Landlord
under this Lease.
4.4 If Tenant shall give Landlord any notice of a claimed default or
breach by Landlord, Tenant agrees to give a similar written notice to the
holder(s) of record of any fee mortgage(s) with respect to the Leased Premises,
provided that Tenant has received written notice of the existence of such fee
mortgage(s), including the name and address of the then holder(s) of such
mortgage(s). Such notice(s) to be given by Tenant to the holder(s) of record of
any fee mortgage(s) shall be sent by registered or certified mail to such
holder(s) at their respective addresses specified in the mortgage instruments,
or to any different address that they may designate for the purpose by written
notice given to Tenant in the manner provided in this Lease for notices to be
given to Tenant. Such mortgagee(s) shall be permitted to correct or remedy
Landlord's breach or default within thirty (30) days after the last day on
which Landlord may do so, and with like effect as if Landlord had done so. In
the event, however, that such breach or default is of a nature that the same
cannot be corrected or remedied by such mortgagee(s) without first obtaining
possession of the Leased Premises from Landlord, and such mortgagee(s) inform
Tenant that it (they) intend to cure following the obtaining of possession, the
time hereinbefore allowed to such mortgagee(s) to cure shall be extended for
the period necessary to obtain possession of the Leased Premises from Landlord.
Tenant's failure to give any holder of a fee mortgage the notice provided in
this paragraph shall not be deemed a default by Tenant under this Lease, but no
notice given by Tenant to Landlord of any claim, default, or breach by Landlord
shall be deemed legally effective until Tenant shall have given such notice to
any and all such holders of fee mortgages with respect to the Leased Premises.
4.5 In the event that any mortgagee comes into possession or ownership
of the fee title to the Leased Premises, or acquires the leasehold interest of
Landlord, by foreclosure of its mortgage, by proceedings on the underlying bond
or debt, or otherwise, Tenant agrees to attorn to such mortgagee as its new
lessor. In no event, however, shall Tenant be entitled to credit against such
mortgagee in possession of the Leased Premises, or against any mortgagee or
other party that otherwise becomes the new lessor of Tenant as provided in this
Section 4.5, for any Fixed Net Rent paid by Tenant to the predecessor of such
mortgagee or other party for more than one (1) month in advance or any
additional rent then due. The provisions for attornment hereinbefore set forth
in this Article 4 shall not require the execution of any further instrument.
However, if the holder of any fee mortgage and/or any party to whom Tenant
agrees to attorn as aforesaid reasonably requests a further instrument
expressing such attornment, Tenant agrees to execute the same in form
reasonably acceptable to such mortgagee and/or party within fifteen (15) days
after a request made do so in accordance with the provisions of this Lease,
provided such instrument does not increase Tenant's obligations or adversely
affect Tenant's rights.
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ARTICLE 5
USE OF THE LEASED PREMISES
5.1 Except as otherwise provided in this Article 5, Tenant shall be
permitted to use the Leased Premises as an automobile dealership, subject,
however to:
(a) the laws, ordinances, orders, rules and regulations
(including, without limitation, zoning ordinances) now in effect or hereafter
adopted by all governmental and quasi-governmental authorities having or
asserting jurisdiction; and
(b) such conditions, restrictions and other encumbrance, if any,
to which the Leased Premises are subject at the date of this Lease,
5.2 Notwithstanding anything to the contrary provided in Section 5.1,
Tenant shall not use or occupy the Leased Premises, permit or suffer the same
to be used or occupied and/or do, or permit or suffer anything to be done, in
or on the Leased Premises or any part thereof, that would, in any manner or
respect:
(a) violate any certificate of occupancy in force relating to any
Improvement situated on the Leased Premises (unless Tenant obtains an amendment
to the certificate of occupancy in order to avoid such violation);
(b) make void or voidable any insurance then in force with respect
to the Leased Premises, or render it impossible to obtain fire or other
insurance thereon required to be furnished by Tenant under this Lease;
(c) cause structural or other injury to any of the Improvements,
or constitute a private or public nuisance or waste; and/or
(d) render the Leased Premises incapable of being used or occupied
after the expiration or sooner termination of the Term of this Lease for the
purposes for which the same were used and occupied on the Commencement Date
(such use being automotive sales, servicing, leasing, financing and automotive
insurance).
5.3 If Tenant proposes to change the use (including discontinuing any
use) at a particular location as an automobile dealership, Tenant shall provide
Landlord with written notice, including a description of the proposed use, the
name and credit information of any user, the date when the use is proposed to
change, and the basic business terms of the proposed transaction. Within 30
days after receipt of Tenant's notice, (i) Landlord shall inform Tenant whether
or not Landlord consents to the change in use or (ii) Landlord may, at its
option, notify Tenant that it has elected to recapture such portion of the
Leased Premises, in which event this Lease shall terminate as to such portion
at the end of such 30 day period, or such later date as Tenant proposed to
change the use. If Landlord does not elect the option in clause (ii) of the
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preceding sentence, Landlord's consent shall not be unreasonably withheld.
Among the factors Landlord may consider are whether the change may cause the
loss of certain "grandfathered" zoning or use rights to use such location as an
automobile dealership.
5.4 Nothing contained in this Lease, and no action or inaction by
Landlord, shall be deemed or construed to mean that Landlord has granted to
Tenant any right, power, or authority to do any act, or to make any agreement
that may create, give rise to, or be the foundation to any right, title,
interest, lien, charge, or other encumbrance upon the estate of Landlord in the
Leased Premises.
ARTICLE 6
NO REPRESENTATIONS BY LANDLORD
6.1 (a) Tenant acknowledges to Landlord that Tenant has examined
Landlord's title to, as well as the physical condition of, the Leased Premises
prior to the execution and delivery of this Lease and has found the same to be
satisfactory to it for all purposes hereof. In view thereof, Tenant has
accepted the Leased Premises "AS IS" and "WHERE IS" without any representation
or warranty by Landlord of any kind or nature, including, without limitation as
to Landlord's title to the Leased Premises, the physical and environmental
condition of the Leased Premises or the use or occupancy that may be made of
the Leased Premises.
(b) Tenant assumes the sole responsibility for the condition,
operation, maintenance and management of the Leased Premises, and Landlord
shall not be required to furnish any facilities or services or make any repairs
or alterations thereto. Without limiting the foregoing, Tenant shall have no
claims or recourse against Landlord with respect to the condition (including
environmental conditions) or permitted uses of the Leased Premises as of the
date of this Lease, and Tenant hereby waives any such claims against Landlord.
ARTICLE 7
LANDLORD NOT LIABLE FOR FAILURE OF WATER SUPPLY, ETC.
7.1 Landlord shall not be liable for:
(a) any failure of water supply, gas, or electric current, nor for
any injury or damage to person or property for any reason whatsoever,
including, without limitation, that caused by or resulting from:
(i) hurricane, tornado, flood, wind, or similar storms or
disturbances; or
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(ii) the leakage or flow of gasoline, oil, gas, electricity,
steam, water, rain, or snow from the street, sewer, gas mains, tanks, wires,
lines, any subsurface area, any part of the Improvement pipes, appliances,
plumbing works, or any other place; or
(b) any interference with light or other incorporeal hereditaments
by anybody, or caused by operations by or of any public or quasi-public work.
ARTICLE 8
TENANT TO REPAIR
8.1 Tenant shall take good care of the Leased Premises and of the
Improvements now or hereafter situated thereon, both inside and outside, and
keep the same and all parts thereof (including, without limitation the
generality thereof, the roofs, foundations and appurtenances thereto, together
with any and all alterations, additions and improvements therein or thereto) in
good order and condition, suffering no waste or injury. Subject to the terms of
Section 8.3 and Articles 13 and 20 below. Tenant shall, at Tenant's expense,
promptly make all needed repairs and replacements, structural or otherwise,
ordinary and extraordinary, in and to the Improvements now or hereafter erected
upon the Leased Premises, including, but not limited to sidewalks, curbs,
water, electric lines, and gas connections, pipes and mains, and all other
fixtures, machinery and equipment now or hereafter belonging to or used in
connection with the Leased Premises (whether or not located thereon) or used in
the operation of the Improvements. All such repairs and replacements shall be
of good quality sufficient for the proper maintenance and operation of the
Leased Premises and the Improvements thereon, and shall be constructed and,
subject to Section 9.2 below, installed in compliance with all requirements of
all governmental authorities having jurisdiction thereof, and of the Board of
Fire Underwriters or any successor thereof. Tenant shall not permit the
accumulation of waste or refuse matter, nor permit anything to be done upon the
Leased Premises or the Improvements that would invalidate or prevent the
procurement of any insurance policies that may at any time be required pursuant
to the provisions of Article 12, Tenant shall not obstruct, or permit the
obstruction of any street, road, walk, or sidewalk located on or adjoining the
Leased Premises, except as may be permitted by all governmental authorities
having jurisdiction thereof, and shall keep any sidewalks adjoining the Leased
Premises clean and free of snow and ice.
8.2 Landlord shall not, under any circumstance, be required to build
on the Leased Premises, or to make any repairs, restorations, replacements,
alterations, or renewals of any nature or description to the Leased Premises or
to any of the Improvements, whether interior or exterior, ordinary or
extraordinary, structural or nonstructural? foreseen or unforeseen, to make any
expenditure whatsoever in connection with this Lease, or to inspect or maintain
the Leased Premises in any way. Tenant hereby waives the right to make repairs,
restorations, replacements, alterations, or renewals at the expense of Landlord
pursuant to any law. Additionally, Tenant shall not make any claim or demand
upon or bring any action against Landlord for any loss, cost, injury, damage,
or other expense caused by any failure or defect, structural or non-structural,
of the Leased Premises or any part thereof.
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8.3 Notwithstanding anything to the contrary contained in Section 8.1
above, but subject in all respects to the provisions of Section 8.2 above, and
further provided that Tenant is not in default under this Lease beyond any
applicable notice and/or grace period, Tenant shall have the right to elect not
to make any structural repair or structural repairs in or to the Leased Premises
(however, Tenant shall continue to be obligated with respect to nonstructural
repair or repairs) during the last two (2) years of the Term, provided, and upon
the conditions, that:
(a) Tenant shall give to Landlord written notice of such election,
which notice shall describe the repair or repairs to which such notice relates
with reasonable detail and set forth Tenant's good faith estimate of the cost
and expense of performing the same;
(b) if the need for such repair or repairs shall result from
condemnation, then, notwithstanding anything to the contrary provided in this
Lease, Tenant shall have no right to assert any claim against the condemning
authority, or to receive any award or damages therefrom, for consequential
damage to the portion of the Leased Premises not taken or for restoration costs
and/or expenses (all such claims and rights to claim, as well as all such awards
and/or damages, in such circumstances being hereby irrevocably and
unconditionally assigned by Tenant to Landlord), which awards and/or damages
shall be payable to Landlord in addition to the amounts described in
subsections (a) and (b) of Section 20.3 below and in reduction of any amount
payable to Tenant pursuant to subsection (c) of Section 20.3, and the terms of
Section 20.3 shall not apply thereto;
(c) if the need for such repair or repairs shall result from the
happening of an event as to which insurance is, or is required to be,
maintained by Tenant pursuant to the terms of this Lease, then, notwithstanding
anything to the contrary provided in this Lease:
(i) Landlord shall be entitled to adjust the loss with
Tenant's insurance carrier and to settle the same (in Tenant's name, if
required), without obtaining Tenant's consent thereto;
(ii) Landlord shall be entitled to receive and retain for its
own account any and all insurance proceeds becoming available in connection
therewith (Tenant hereby irrevocably and unconditionally assigning to Landlord
all of Tenant's right, title and interest in and to such proceeds), and any
such proceeds received by Tenant shall be received as trust funds for
Landlord's account and shall be promptly remitted by Tenant to Landlord; and
(iii) in the event that the proceeds of insurance provided by
Tenant actually received by Landlord shall be insufficient to compensate
Landlord for the entire loss, whether due to an insufficiency in coverage or
otherwise, Tenant shall pay to Landlord, as additional rent hereunder within
ten (10) days after Landlord's demand therefor, the amount of the shortfall;
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(d) neither the failure of such repair or repairs to be made nor
Landlord's election to make the same pursuant to subsection (f) below shall:
(i) entitle Tenant to terminate this Lease;
(ii) permit Tenant to a reduction or abatement of, or a credit
or off-set against, the full Fixed Net Rent and/or additional rent otherwise
thereafter becoming due hereunder; nor
(iii) otherwise affect or diminish, in any manner or respect
whatsoever, any of Landlord's rights and/or Tenant's other obligations under
this Lease;
(e) notwithstanding the foregoing, Tenant shall make such repair
or repairs at its sole cost and expense, as set forth in Section 8.1, if (x)
the need for such repair or repairs shall result other than from condemnation
and other than from the happening of an event as to which insurance is, or is
required to be, maintained by Tenant pursuant to this Lease and (y) the failure
to make such repair or repairs shall or could:
(i) create or lead to an unsafe condition of any nature
whatsoever;
(ii) result in the invalidation of any policy or policies of
insurance maintained, or required to be maintained, by Tenant pursuant to the
terms of this Lease, or result in the reduction of the coverage provided, or to
be provided thereunder; or
(iii) constitute a crime or an offense punishable by fine or
imprisonment (including, without limitation, result in the filing of a
violation against the Leased Premises or the issuance of any other order or
directive to make such repair or repairs by any governmental agency or
authority having jurisdiction); and
(f) if the failure to make such repair or repairs shall or could
constitute a default under any fee mortgage or if the nature of such repair or
repairs is such that Tenant would be required to make the same pursuant to
subsection (e) above but for the provisions of sub-subsection (x) of such
subsection (e), Tenant shall, if Landlord so elects in its sole discretion,
afford Landlord with all necessary and/or desirable access to the Leased
Premises so as to enable Landlord to perform such repair or repairs for its own
account, and Tenant shall otherwise cooperate with Landlord in connection with
the same in all reasonable respects.
In the event that Landlord shall make a demand upon Tenant pursuant to
sub-subsection (iii) of subsection (c) above and Tenant shall dispute the
amount claimed by Landlord, the dispute shall be resolved, upon the petition of
either party, by an arbitration conducted by the parties in accordance with the
provisions of Article 21 below. Tenant's obligations under subsections (b) and
(c) and, if applicable, subsection (e) of this Section 8.3 shall survive the
expiration or sooner termination of the Term.
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ARTICLE 9
TENANT TO COMPLY WITH LAWS; ENVIRONMENTAL MATTERS
9.1 Tenant shall, at Tenant's expense, promptly comply with:
(a) the requirements of every applicable statute, law, ordinance,
regulation, or order now or hereafter made by any Federal, State, County,
municipal, or other public body, department, bureau, officer or authority, with
respect to:
(i) the Leased Premises, the Improvements and appurtenances
thereto;
(ii) the use or occupation of the Leased Premises and the
Improvements, including the making of any alteration or addition in or to any
structure upon, connected with, or appurtenant to, the Leased Premises; and
(iii) the removal of any encroachment, but only if required to
do so by order of any court, department, or bureau having jurisdiction:
(b) the requirements of all easements, restrictions and other
documents existing of record as of the date of this Agreement of Lease and/or
hereafter granted by Landlord with the prior written consent or joinder of
Tenant, which consent or joinder shall not be unreasonably withheld or delayed
by Tenant; and
(c) any applicable regulation or order of the Board of Fire
Underwriters, Fire Insurance Rating Organization, or other body having similar
functions whether or not such compliance involves structural repairs or
changes, whether or not such compliance is required on account of any
particular use to which the Leased Premises, the Improvements, or any part
thereof may be put, whether or not any such statute, law, ordinance,
requirement, regulation, or order is of a kind now within the contemplation of
the parties hereto and regardless of the cost thereof.
9.2 Provided that non-compliance therewith shall not constitute a
crime or an offense punishable by fine or imprisonment, and provided, further,
that no Event of Default shall have occurred and be continuing under the terms
of this Lease, Tenant may, at Tenant's expense, contest the validity of any
such law, ordinance, regulation, order, or requirement, and such noncompliance
by Tenant during such contest, provided that such contest shall be diligently
prosecuted, shall not be deemed a breach of this covenant, provided that,
before the commencement of such contest, Tenant shall furnish to Landlord, if
Landlord so requires, either:
(a) the bond of a surety company reasonably satisfactory to
Landlord, which bond shall:
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(i) be as to its provisions and form, satisfactory to
Landlord, but in any event such as will cause the discharge of any lien on
Landlord's fee title to the Leased Premises;
(ii) be in an amount at least equal to one hundred and ten per
centum (110%) of the estimated cost of such compliance but not less than
required to discharge any such lien; and
(iii) indemnify Landlord against the cost of such compliance,
as well as against all liability for any damages, interests, penalties and
expense (including reasonable fees of attorneys or counsel), resulting from or
incurred in connection with such contest or non-compliance: or
(b) other security, in lieu of such bond that is reasonably
satisfactory to Landlord as to form and amount.
9.3 (a) Subject to Section 9.2 above, Tenant shall conduct, and cause
to be conducted, all operations and activity at the Leased Premises in
compliance with, and shall in all other respects applicable to the Leased
Premises comply with, all applicable present and future federal, state,
municipal and other governmental statutes, ordinances, regulations, orders,
directives, guidelines and other requirements, and all present and future
requirements of common law, concerning the environment (hereinafter called
"ENVIRONMENTAL STATUTES") including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. Sections 9601
et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Sections 9601 et
seq., the Clean Air Act, 42 U.S.C. Sections 7401 et seq., and the Toxic
Substances Control Act, 15 U.S.C. Sections 2601 et seq., those relating to the
generation, use, handling, treatment, storage, transportation, release,
emission, disposal, remediation or presence of any material, substance, liquid,
effluent or product, including, without limitation, hazardous substances,
hazardous waste or hazardous materials, those concerning conditions at, above or
below the surface of the ground and those concerning conditions in, at or
outside of buildings.
(b) Tenant, in a timely manner, shall obtain and maintain in full
force and effect all permits, licenses and approvals, and shall make and file
all notifications and registrations, as required by Environmental Statutes.
Tenant (subject to Tenant's right to contest as elsewhere provided) shall at
all times comply with the terms and conditions of any such permits, licenses,
approvals, notifications and registrations.
(c) Tenant shall provide to Landlord copies of the following,
forthwith after each shall have been submitted, prepared or received by Tenant
or any affiliate of Tenant: (i) all applications and associated materials
submitted to any governmental agency relating to any Environmental Statute;
(ii) all permits, licenses, approvals, and amendments or modifications thereof,
obtained under any Environmental Statute; and (iii) any notice of violation,
summons, order, or complaint, received by Tenant or any occupant of the Leased
Premises pertaining to compliance with any Environmental Statute.
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(d) Tenant, without the prior written consent of Landlord, shall
not install or cause, suffer or permit the installation of, any above or
underground storage tank at the Leased Premises. If Tenant does install or
cause, suffer or permit the installation of any such tank, Tenant shall comply
with all applicable laws as to its installation, maintenance, operation and
closure, including any requirement for the maintenance of liability insurance
with respect to risks associated with any such tank. If such liability
insurance is required to be maintained, Landlord shall be named as an
additional insured thereunder. Upon termination of this Lease, Landlord shall
have the option of requiring that Tenant, at Tenant's sole cost and expense,
remove any tank installed by Tenant and any associated contaminated material
and other contamination and perform all tests required by Landlord and any
required by Environmental Statutes and any other applicable governmental
requirements and provide Landlord and all required government agencies with
the results of such tests in such form as reasonably required by Landlord or
as required by law.
(e) Tenant shall not cause or suffer or permit to occur at, in, on
or under the Leased Premises any generation, use, manufacturing, refining,
transportation, emission, release, treatment, storage, disposal, presence or
handling of hazardous substances, hazardous wastes or hazardous materials (as
such terms are now or hereafter defined under any Environmental Statute)
(herein called "HAZARDOUS SUBSTANCES"), except that construction materials
(other than asbestos or polychlorinated biphenyls), office equipment, fuel and
similar products and cleaning solutions, and other maintenance materials that
are or contain Hazardous Substances, and other Hazardous Substances which are
contained in a suitable and safe manner, may be used, generated, handled or
stored on the Leased Premises, provided such is incident to and reasonably
necessary for the operation and maintenance of the Leased Premises as an
automobile dealership and service center or other uses permitted hereunder and
is in compliance with all Environmental Statutes and all other applicable
governmental requirements. Should any release of any Hazardous Substance occur
at the Leased Premises, Tenant shall promptly contain, remove and dispose of
off the Leased Premises, such Hazardous Substances, and any material that was
contaminated by the release and remedy and mitigate all threats to human health
or the environment relating to such release as and to the extent required by
applicable Environmental Law. When conducting any such measures, Tenant shall
comply with Environmental Statutes.
(f) If the use of the Leased Premises by Tenant, or any operation
or activity conducted at the Leased Premises during the Term of this Lease,
shall be such as requires, under any present or future Environmental Statute,
the obtaining of an approval (herein called an "ENVIRONMENTAL APPROVAL OF
TRANSFER OR CHANGE") by any governmental agency, or an acknowledgment by such
agency that such approval is not required, (i) in order to change or transfer
ownership of the Leased Premises, (ii) in order to change or transfer Tenant's
interest in this Lease or any interest in Tenant or in any entity which
directly or indirectly controls Tenant or (iii) in connection with: (A)
cessation of all or any operations or activity at the Leased Premises for any
reason or (B) a change in or transfer of any operations or activity at the
Leased Premises or (C) the expiration or termination of this Lease (each of the
transactions and occurrences referred to in the foregoing clauses (i), (ii) or
(iii) being hereinafter called a
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"CHANGE"). Tenant, at Tenant's sole cost and expense, shall, in compliance with
all Environmental Statutes, apply for, and prior to the Change deliver to
Landlord, a copy of the required approval or acknowledgment and Tenant shall
perform or cause to be performed all remedial actions required by such
governmental agency for the issuance of the approval, in whole or in part by
reason of Tenant's use of the Leased Premises or operations or activities at
the Leased Premises during the Term of this Lease; provided that as to any
Change which is a change or transfer of ownership of the Leased Premises or of
an interest in Landlord or in any entity which directly or indirectly controls
Landlord, Tenant shall instead (x) promptly comply with any request of Landlord
to provide such information, statements or affidavits as to operations and
activities at the Leased Premises during the Term of this Lease, and as to the
use of the Leased Premises by Tenant, as may be determined by Landlord to be
necessary, (y) either promptly perform or, at the option of Landlord, reimburse
Landlord within 15 days after demand for Landlord's costs of, all remedial
actions required by any governmental agency for issuance of the Environmental
Approval of Transfer or Change and (z) pay, or reimburse Landlord for, all
other costs and expenses which are attributable to the existence of Tenant's
tenancy or to Tenant's use of the Leased Premises or to any operation or
activity at the Leased Premises during the Term of this Lease and were incurred
to obtain such required approval or acknowledgment. Tenant covenants,
represents and warrants that any application, statement or information made or
provided by or through Tenant pursuant to this subsection shall be true and
complete. If there should be an Environmental Statute which requires an
Environmental Approval of Transfer or Change, but such requirement shall not
have been made applicable by Tenant's use of the Leased Premises or operations
or activities conducted at the Leased Premises during the Term of this Lease.
and if an official statement of such non-applicability shall be obtainable from
the applicable governmental agency, then, whether or not the obtaining of such
statement is required by law, Tenant, at Tenant's sole cost and expense, shall
obtain and deliver such statement to Landlord before the change occurs (in the
case of a change described in clause (ii) or clause (iii) above) or promptly
upon request of Landlord (in the case of a change described in clause (i)
above).
(g) Tenant agrees to permit Landlord and its authorized
representatives to enter, inspect and assess the Leased Premises at reasonable
times for the purpose of determining Tenant's compliance with the provisions of
this Section 9.3.
(h) Tenant hereby agrees to indemnify and to hold harmless
Landlord of, from and against any and all expense, loss or liability suffered
by Landlord by reason of Tenant's breach of any of the provisions of this
Section 9.3, including, but not limited to, (i) any and all expenses that
Landlord may incur in complying with any Environmental Statutes, (ii) any and
all costs that Landlord may incur in studying, assessing, containing, removing,
remedying, mitigating, or otherwise responding to, the release of any
Hazardous Substance or waste at or from the Leased Premises, (iii) any and all
costs for which Landlord may be liable to any governmental agency for studying,
assessing, containing, removing, remedying, mitigating, or otherwise responding
to. the release of a Hazardous Substance or waste at or from the Leased
Premises, (iv) any and all fines or penalties assessed, or threatened to be
assessed, upon Landlord by reason of a failure of Tenant to comply with any
obligations, covenants or conditions set forth
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in this Section 9.3, and (v) any and all legal fees and costs incurred by
Landlord in connection with any of the foregoing.
(i) No subsequent modification or termination of this Lease by agreement of the
parties, or otherwise shall be construed to waive, or to modify, any provisions
of this Section 9.3, unless the termination or modification agreement or other
document so states in writing and makes specific reference to this Section 9.3.
ARTICLE 10
INTENTIONALLY OMITTED
10.1 Intentionally omitted.
ARTICLE 11
NET LEASE; NON-TERMINABILITY
11.1 This Lease is a net lease, and the Fixed Net Rent, additional
rent and all other sums payable hereunder to, or on behalf of, Landlord shall
be paid without notice or demand and without setoff, counterclaim, abatement,
suspension deduction, or defense, Landlord and Tenant each hereby further agree
and confirm that, notwithstanding anything to the contrary contained in this
Lease, it is the purpose and intent of both Landlord and Tenant that the rents
payable under this Lease shall be absolutely net to Landlord, so that this
Lease shall yield, net to Landlord, the Fixed Net Rent specified herein in each
year during the Term.
11.2 Except as otherwise expressly provided herein, this Lease shall
not terminate, nor shall Tenant have any right to terminate this Lease or be
entitled to the abatement of any rent or any reduction thereof, nor shall the
obligations hereunder of Tenant be otherwise affected, any present or future
law to the contrary notwithstanding, by reason of:
(a) any damage to, or the destruction of; the Leased Premises, the
Improvements, or any portion thereof, from whatever cause;
(b) the taking of the Leased Premises, the Improvements, or any
portion thereof by condemnation or otherwise, except as, and to the extent,
provided to the contrary in Article 20 below;
(c) the prohibition, limitation, or restriction of Tenant's use of
the Leased Premises, the Improvements, or any portion thereof (including,
without limitation, any diminution in the amount of space usable by Tenant at
the Leased Premises caused by legally required changes in the construction,
equipment, fixture, motors, machinery, operation, or use of the Leased
Premises), or the interference with such use by any private person or entity;
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(d) Tenant's acquisition of the fee ownership of the Leased
Premises or the Improvements; or
(e) any other cause whatsoever, whether similar or dissimilar to
the foregoing, it being the intention of the parties hereto that the Fixed Net
Rent and additional rent reserved hereunder shall continue to be payable in all
events, and the obligations of Tenant hereunder shall continue unaffected,
unless the requirement to pay or perform the same shall be terminated pursuant
to an express provision of this Lease.
11.3 Except as provided in Article 20 below, Tenant waives all rights
now or hereafter conferred by law to:
(a) quit, terminate, or surrender this Lease or the Leased
Premises, the Improvements or any part thereof; or
(b) any abatement, suspension, determent, or reduction of the
Fixed Net Rent, additional rent, or any other sums payable under this Lease,
regardless of whether such rights shall arise from any present or future
constitution, statute, or rule of law.
ARTICLE 12
INSURANCE
12.1 Throughout the Term, Tenant shall, at its own cost and expense:
(a) keep the Improvements insured against loss or damage by fire,
windstorm, and other perils included in so-called "All Risk" or Special Form
Insurance policies and also including coverage for floods, earthquakes, and
sinkholes. Insurance amounts shall be provided for 100% of the full replacement
cost value of buildings and other land improvements. Coverage extensions shall
include: Replacement Cost Value with a Coinsurance Waiver or Agreed amount
Endorsement, and Demolition and Increased Cost of Construction (Law and
Ordinance). Such insurance shall:
(i) be issued by insurance companies authorized to do business
in the State where the Leased Premises are located and be rated in the latest
publication of A.M. Best rating guide or equivalent rating guide at A:IX or
A:VIII or greater, under insurance policies in form and content reasonably
satisfactory to Landlord;
(ii) be carried in the name, and in favor, of Landlord, Tenant
and any fee mortgagee(s), as their respective interests may appear;
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(iii) effectively provide that the respective interests of
Landlord and any fee mortgagee(s) shall not be subject to cancellation by
reason of any act or omission of Tenant without sixty (60) days prior written
notice of such cancellation, however, when cancellation is for nonpayment of
premium the insurance company may cancel the policy by giving at least ten (10)
days prior written notice of such cancellation;
(iv) subject to the requirements of any fee mortgagee, provide
that the loss, if any, under any such policies shall be adjusted by Tenant,
that Landlord may participate in the loss adjustment, and Landlord may adjust
the loss if Tenant fails to do so, and provide that the loss shall be paid by
the insurance company or companies as provided in Section 12.7; and
(v) provide Business Interruption or Rental Value insurance
including coverage for the continuing rental obligations under this Lease on an
Actual Loss Sustained basis in amounts not less than 12 months insurable value
with loss payable endorsement thereunder in favor of the Landlord; and
(vi) provide Comprehensive Boiler & Machinery insurance
covering all pressure vessels, boilers, mechanical, and electrical equipment at
the Leased Premises. This coverage shall include Extra Expense and insurance
for the continuing rental obligations under this Lease. Insurance amounts shall
be as reasonably required by Landlord, but not less than $5 million per
accident; and
(vii) provide such other insurance as may from time to time be
reasonably required by the Landlord as insurance against insurable hazards that
are customarily and generally required to be insured with respect to similar
premises, with due regard for the height, depth and type of the Improvements,
their construction and their use and occupancy.
(b) provide Landlord and any fee mortgagee(s) with public
liability insurance policies which insurance shall comply with the requirements
of subsections 12.1 (a)(i) and (iii) and shall provide at least the following:
(i) Commercial General Liability covering the Leased Premises
and operations of the Tenant in amounts not less than $1 million per occurrence
and $2 million in the annual aggregate per location and including coverage for
Products and Completed Operations Liability;
(ii) Commercial Automobile Liability, including Garage
Liability, covering all Owned, Hired, Non Owned Automobiles including customer
and demonstrator vehicles, any other vehicle usual to the Tenant's business in
amounts not less than $1 million per accident;
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(iii) Garagekeepers Legal Liability providing coverage for
vehicles of others in the possession of the automobile dealer for physical
damage to those vehicles;
(iv) Workers Compensation and Employers Liability, which
coverage shall meet the statutory requirements of the state in which the Leased
Premises is located;
(v) Umbrella Liability in excess of the Commercial General,
Automobile, Garage, and Employers Liability in amounts not less than
$10,000,000 per occurrence and in the annual aggregate;
(vi) all Third Party liability policies shall name the
Landlord and any fee mortgagee(s) as an "Additional Insured" and be evidenced
by a certificate of insurance policy endorsement specifically indicating the
Landlord's and any fee mortgagee(s) Additional Insured status;
(vii) other insurance as is customary to the operations of the
Tenant or as may reasonably be required by the Landlord as good commercial
practice would dictate.
In the event of any dispute between Landlord and Tenant with respect to the
amount of general liability coverage to be maintained by Tenant and/or the
types and amounts of such other insurance as Landlord may reasonably require
Tenant to carry from time to time, as above provided, such dispute shall be
arbitrated pursuant to the provisions of Article 21 of this Lease.
12.2 Tenant shall procure policies for the insurance required to be
carried pursuant to Section 12.1 for periods of from one (1) to five (5)
years, as Tenant shall elect, and shall deliver to Landlord original
certificates thereof with evidence, by stamping or otherwise, of the payment of
the premiums thereon. Any such policies shall contain a loss payable
endorsement which shall provide that (i) the loss, if any, under such policies
shall be paid by the insurance companies as provided in Section 12.7 below,
(ii) the insurer will not cancel or modify such policy except after sixty (60)
days prior written notice to Landlord, however, if the cancellation is for
nonpayment of premium, the insurance company may cancel the policy after ten
(10) days' prior written notice to Landlord, and (iii) any loss payable
thereunder shall not be invalidated by any act or neglect of the Tenant, nor by
any foreclosure or other proceedings or notice of sale relating to the Leased
Premises nor by any change in the title or ownership of said property, nor by
the occupation of the locations for purposes more hazardous than are permitted
by the Policy.
12.3 All premiums and charges for Tenant's insurance policies
(including, without limitation, for the insurance policies required to be
carried pursuant to Section 12.1) shall be paid by Tenant. If Tenant shall fail
to make any such payment when due, or shall fail to carry any such policy, the
provisions of Article 14 shall apply.
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12.4 Tenant shall pay the premiums for Tenant's initial policies of
insurance required hereunder and all renewals thereof not later than the due
date thereof so as to prevent a lapse of coverage. Prior to the expiration of
each policy of insurance, Tenant shall deliver to Landlord a certificate of
such renewal policy with evidence, by stamping or otherwise, of the payment of
the premiums thereon. If any such premiums shall not be paid when due or if
such a certificate of any renewal policy required to be delivered hereunder
shall not be so delivered, the provisions of Article 14 shall apply.
12.5 Tenant shall not violate, or permit to be violated, any of the
conditions or Provisions of any such policy, and Tenant shall so perform and
satisfy the reasonable requirements of the companies writing such policies.
12.6 Tenant shall not carry separate insurance, concurrent in coverage
or contributing in the event of loss with any insurance required to be
furnished by Tenant under the provisions of this Article 12, if the effect of
such separate insurance would be to reduce the protection or the payment to be
made under said insurance required to be furnished by Tenant, unless Landlord
and any fee mortgagee(s) (where the insurance required to be carried requires
the inclusion of the fee mortgagee(s)) are included as additional insureds,
with loss payable as hereinabove provided. Tenant shall promptly notify
Landlord of the issuance of any such separate insurance and shall cause such
policies or certificates of insurance to be delivered to Landlord and any fee
mortgagee(s) as provided in this Article 12.
12.7 The loss proceeds of any fire and extended coverage insurance
shall be:
(a) if less than Five Hundred Thousand ($500,000.00) Dollars, paid
to Tenant as a trust fund, to be deposited in a separate bank account
maintained by Tenant and used, applied and paid to the repair and restoration
of the damage of the Improvements on the Leased Premises (such $500,000 figure
shall be increased every five years by the corresponding increase in the CPI);
or
(b) if in excess of Five Hundred Thousand ($500.000.00) Dollars
(such $500,000 figure shall be increased every five years by the corresponding
increase in the CPI), paid to, and deposited with, the Depositary, which shall
hold, apply, and make available the proceeds of such insurance to pay the cost
of repair of the damage and replacement or rebuilding of the Improvements as
more particularly provided in Article 13.
12.8 In the event that Landlord receives any rent insurance proceeds,
Tenant shall be credited therefor as payments made to Landlord on account of
Fixed Net Rent and additional rent payable by Tenant.
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ARTICLE 13
FIRE OR CASUALTY
13.1 If, during the Term of this Lease, the Improvements now or
hereafter erected upon the Leased Premises shall be destroyed or damaged, in
whole or in part, by fire, as a result, directly or indirectly, of war, by act
of God, or by reason of any other cause or causes whatsoever (whether or not
insurable), Tenant shall give prompt notice thereof to Landlord and file prompt
proof of loss with the appropriate insurance company or companies (if insured).
At Tenant's own cost and expense, Tenant shall thereafter promptly repair,
replace and rebuild the Improvements, at least to the extent of the value and as
nearly as practicable to the character of the Improvements existing immediately
prior to such occurrence. Such repairs, replacements, or rebuilding shall be
made by Tenant in accordance with the following terms and conditions:
(a) the same shall be made in accordance with plans and
specifications therefor, if required by law;
(b) at least ten (10) days before commencing such work,
Tenant shall notify Landlord of Tenant's intention to commence the same, and
Tenant shall pay the increased premiums, if any, charged by the insurance
companies carrying insurance on the Improvements in order to cover the
additional risk during the course of such work;
(c) before commencing any such work:
(i) plans and specifications therefor shall be
filed and approved by all governmental departments and other authorities having
jurisdiction thereof;
(ii) a firm estimate for the cost of such work
shall be obtained;
(iii) Tenant shall, at its own cost and expense,
deliver to Landlord appropriate endorsements to be attached to, and made part
of, the fire and liability policies more particularly described in Article 12,
which endorsements shall cover all of the risks concerned during the course of
such work and shall be in form and content reasonably satisfactory to Landlord;
(d) such work shall be commenced within one hundred
twenty (120) days after settlement shall have been made with the insurance
companies and the insurance monies shall have been turned over to Tenant or the
Depositary as provided in Article 12 hereof and all necessary governmental
approvals shall have been obtained; and
(e) such work shall be completed:
(i) within a reasonable time after the
commencement of the same, due regard being had to conditions;
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(ii) free and clear of all liens and
encumbrances; and
(iii) in accordance with the plans and
specifications therefor.
Any dispute with respect to any of the insurance endorsements referred to in
subsection (c)(iii) above shall be determined by arbitration as hereinafter
provided.
13.2 The Depositary shall, provided that this Lease shall then be
in full force and effect, apply the net proceeds of any insurance deposited with
it to the payment of the cost of such repairing or rebuilding as the same
progresses, payments to be made against properly certified vouchers of a
competent architect in charge of the work selected by Tenant. The Depositary
shall advance out of such insurance proceeds, toward each payment to be made by
or on behalf of Tenant, the amount that shall bear the same portion to such
payment as the whole amount received by the Depositary shall bear to the total
estimated cost of the repairing or rebuilding, except, however, if the contract
provides for a retainage, the Depositary shall withhold from each amount so to
be paid by it ten percent (10%) as a retainage until:
(a) the work of repairing or rebuilding shall have been
completed; and
(b) reasonable proof is furnished to the Depositary and
Landlord that no lien or liability has attached, or will attach, to the Leased
Premises, to the Improvements, or to Landlord in connection with such repairing
or rebuilding.
If at any time the total estimated cost of the repairs or rebuilding shall
exceed the amount of the net proceeds of such insurance received by the
Depositary, the Depositary shall require of Tenant that, before such repairing
or rebuilding be commenced or continued, the Depositary be secured by a surety
bond or cash equal to the amount of the excess of such estimated cost over the
net insurance proceeds as security for the due completion, within a reasonable
time, of such repairs or rebuilding. The total cost of all such rebuilding
shall, at all events, be borne by Tenant without any contribution thereto by
Landlord. If the insurance proceeds shall exceed the cost of repairs or
rebuilding, the balance remaining after payment of the cost of repairs or
rebuilding shall be paid over and belong to Tenant.
13.3 If:
(a) the work of repairing, replacing, or rebuilding such
damage or destroyed Improvements shall not have been commenced within the one
hundred twenty (120) day period (subject to force majeure causes) provided for
in subdivision (d) of Section 13.1; or
(b) such work, after commencement, shall not be
expeditiously proceeded with, unless such work is delayed by strikes, lockouts,
labor disputes, or other causes unavoidable or reasonably beyond the control of
Tenant,
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Landlord shall have the right to terminate this Lease and the Term by giving
Tenant not less than thirty (30) days written notice of Landlord's intention so
to do, and, upon the expiration of the date fixed in such notice, this Lease and
the Term shall wholly cease and expire, and the insurance proceeds received and
receivable under any and all policies of insurance shall be retained by
Landlord, or by any mortgagee of the fee to whom the same day be payable, as
their interests may appear, without claim thereon by Tenant, but Tenant shall
continue liable as provided in Article 17 hereof. Any dispute under this Section
13.3 shall be determined by arbitration as hereinafter provided.
13.4 Except as provided in Section 13.3, this Lease shall not
terminate or be affected in any manner by reason of the destruction or damage,
in whole or in part, of the Improvements, or by reason of the untenantability of
the Improvements, or the Leased Premises, and the Fixed Net Rent reserved in
this Lease, as well as all other charges payable hereunder to the extent that
the same are not actually paid pursuant to rent insurance, shall be paid by
Tenant in accordance with the terms, covenants and conditions of this Lease
without abatement, diminution, or reduction.
ARTICLE 14
LANDLORD MAY CURE DEFAULTS
14.1 If Tenant shall default in:
(a) making any payment required to be made by Tenant
under this Lease and such default is not cured within any applicable notice
and/or grace period pursuant to Section 16.1 hereof after written notice has
been given under Article 29 below; or
(b) performing any term, covenant, or condition of this
Lease on the part of Tenant to be performed and such default is not cured within
the applicable grace period pursuant to Section 16.1 (b) hereof, Landlord may,
at its option (but shall not be obligated to do so) and for the account of
Tenant, make such payment or expend such sum as may be necessary or desirable to
perform and fulfill such term, covenant, or condition. However, no such payment
or expenditure by Landlord shall be deemed a waiver of Tenant's default, nor
shall the same affect any other remedy of Landlord by reason of such default.
14.2 Any and all sums paid or expended by Landlord pursuant to
Section 14.1, as well as any other out of pocket cost or expense (including,
without limitation, reasonable attorneys fees, disbursements and court costs)
incurred by Landlord in instituting, prosecuting, or defending any action or
proceeding instituted by reason of, or relating to, any default by Tenant under
this Lease (provided, however, that, as to such costs and expenses related to an
action or proceeding, Landlord prevails therein), shall:
(a) be repaid by Tenant to Landlord as additional rent
under this Lease within 30 days after Landlord's written demand therefor; and
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(b) bear interest from the date of Landlord's payment or
expenditure thereof to the date of Tenant's repayment of the same to Landlord,
both dates inclusive, at the rate of two (2%) percent per annum plus the
so-called prime, base, index, or reference interest rate publicly announced by
The Chase Manhattan Bank, N.A., from time to time in effect (but in no event in
excess of any then lawful maximum interest rate then applicable to Tenant).
ARTICLE 15
BANKRUPTCY, INSOLVENCY, REORGANIZATION, LIQUIDATION OR DISSOLUTION OF TENANT
15.1 The occurrence of any of the following events at any time
during the Term shall constitute and be deemed a material breach of this Lease
and a default by Tenant, entitling Landlord, at its option to exercise such
remedies as may be available to it at law or in equity, including, to the extent
permitted by applicable law, to cancel and terminate this Lease upon giving
Tenant a thirty (30) day notice in writing of Landlord's intention so to do,
whereupon this Lease shall terminate and come to an end at the expiration of
said thirty (30) days as if said expiration date were the time originally fixed
for the termination of this Lease, and Tenant shall quit and surrender the
Leased Premises and the Improvements to Landlord:
(a) the filing of a petition by or against Tenant under
this Lease and/or by or against any guarantor of the obligations of Tenant under
this Lease (herein called a "GUARANTOR") under the provisions of the United
States Bankruptcy Act, or under the provisions of any other federal or state law
of similar import now or hereafter in effect, for an arrangement,
reorganization, adjudication of bankruptcy and/or any other relief thereunder;
(b) the dissolution or liquidation of Tenant under this
Lease and/or any Guarantor, or the commencement of any action or proceeding by
or against Tenant under this Lease and/or any Guarantor for its dissolution or
liquidation, that shall be other than a voluntary dissolution, liquidation,
spinoff, split-off, or other similar proceeding pursuant to the United States
Internal Revenue Code whereby the assets of Tenant and/or such Guarantor are
distributed to its stockholders or to a partnership comprised of any such
stockholders;
(c) the appointment of a permanent receiver or a
permanent trustee of all or substantially all of the property of Tenant under
this Lease and/or any Guarantor or the commencement of any action or proceeding
by or against Tenant and/or such Guarantor for such appointment;
(d) the seizure of the property of Tenant under this
Lease and/or any Guarantor by any governmental officer or agency pursuant to
statutory authority for the dissolution, rehabilitation, reorganization or
liquidation of Tenant and/or such Guarantor; or
(e) the assignment by Tenant under this Lease and/or any
Guarantor of its property for the benefit of creditors,
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However, if any event described in subsection (a), (b), (c), or (d) occurs and
is not voluntarily initiated or commenced by Tenant and/or such Guarantor, or on
behalf of Tenant and/or such Guarantor, the event in question shall not
constitute or be deemed a default hereunder provided that the same is removed or
remedied by appropriate discharge or dismissal of the action or proceeding
concerned, and the discharge or any receiver, trustee, or other judicial
custodian appointed for the property of Tenant and/or such Guarantor within one
hundred twenty (120) days from the commencement date of such action, proceeding,
or appointment.
15.2 It is stipulated and agreed that, in the event of the
termination of this Lease pursuant to Section 15.1 hereof, Landlord, at its
election, shall forthwith be entitled to recover from Tenant, as and for
liquidated damages an amount computed pursuant to Section 17.2 hereof.
If the Leased Premises, or any part thereof, is re-let by
Landlord for the unexpired portion of the Term, or any part thereof, before
presentation of proof of such liquidated damages to any court, commission, or
tribunal, the amount of rent reserved upon such reletting shall be prima facie
evidence that it is the fair and reasonable rental value for such part or the
whole of the Leased Premises so re-let during the term of the re-letting.
Nothing herein contained shall limit or prejudice the right of Landlord to prove
for and obtain, as liquidated damages by reason of such termination, an amount
equal to the maximum allowed by any statute or rule of law in effect at the time
when, and governing the proceedings in which, such damages are to be proved,
whether or not such amount is greater or less than, or equal to, the amount of
the difference referred to above.
ARTICLE 16
DEFAULT CLAUSES
16.1 Upon the occurrence of any of the following events
(hereinafter called "EVENTS OF DEFAULT"), Landlord shall have the right, at
Landlord's option, in addition to exercising its remedies under Section 16.4
and/or Articles 14 or 17, to terminate this Lease and the Term, as well as all
of the right, title and interest of Tenant in and to the Leased Premises
hereunder, by giving Tenant ten (10) days' notice in writing of such
termination, whereupon this Lease and the Term, as well as all of the right,
title and interest of Tenant in and to the Leased Premises, shall wholly cease
and expire in the same manner, and with the same force and effect (except as to
Tenant's liability), as if the date fixed by such notice were the expiration
date of the Term:
(a) if Tenant shall fail to pay any installment of Fixed
Net Rent, any other item of additional rent, or any part thereof as and when the
same shall become due and payable, and such default shall continue for a period
of five (5) business days after written notice from Landlord, provided no such
notice shall be required more than three times in any 12 month period;
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(b) subject to Section 16.2 below, if Tenant shall
violate, fail to comply with, or fail to perform any other covenant, term, or
condition of this Lease, other than requiring payment of a sum of money, and
such default shall continue for a period of thirty (30) days after written
notice from Landlord:
(c) if any execution or attachment shall be issued
against Tenant or any of Tenant's property, whereby the Leased Premises or the
Improvements shall be taken or occupied, or attempted to be taken or occupied by
someone other than Tenant, and such condition shall continue for a period of
thirty (30) days after written notice from Landlord; or
(d) if Tenant's right, title and interest in this Lease,
or the estate of Tenant hereunder, shall be transferred or passed to, or devolve
upon, any other person, firm, or corporation, except in the manner provided in
this Lease.
On or before the expiration of the ten (10) days termination notice referred
to above, Tenant shall immediately quit and surrender the Leased Premises, the
Improvements and each and every part thereof to Landlord, and Landlord may enter
into or repossess the Leased Premises and the Improvements by summary or other
suitable proceedings.
16.2 If any of the events described in subsection (b) of Section
16.1 occurs and is of such a nature that it cannot practicably be cured and
remedied within the applicable notice period, an Event of Default shall not be
deemed to exist with respect thereto if Tenant shall:
(a) commence the work, or initiate the action, required
to cure and remedy such event promptly within the applicable notice period; and
(b) thereafter prosecute such work or action in good
faith diligently to completion.
16.3 No default shall be deemed waived by Landlord unless such
waiver is confirmed in a writing signed by Landlord.
16.4 In the event that Tenant shall fail to make any payment of
Fixed Net Rent or additional rent required to be paid pursuant to this Lease on
or before the due date for the payment thereof (without regard to the notice and
grace provisions provided for in Section 16.1), the same shall accrue interest
from and after such due date and until Tenant's payment thereof at a rate equal
to two (2%) per annum plus the so-called prime, base, index, or reference
interest rate publicly announced by The Chase Manhattan Bank, N.A., from time to
time in effect (but in no event in excess of any then lawful maximum interest
rate then applicable to Tenant). In addition to the foregoing interest, as well
as in addition to the other remedies available to Landlord for a default by
Tenant under this Lease and otherwise at law and in equity, in the event that
Tenant shall fail to make any payment of Fixed Net Rent or additional rent
required to be paid pursuant to this Lease on or before the due date for the
payment thereof (without regard to notice and grace provisions provided in
Section 16.1), Tenant shall pay to Landlord, as
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additional rent, in addition to such payment and interest, a charge equal to
five (5%) percent of such late payment in reimbursement for Landlord's
administrative and other expenses in connection with handling and processing
such late payment. Neither this Section 16.4 nor any other provision of this
Lease shall require the payment of interest in excess of the maximum amount
permitted by law. If any excess of interest in such respect is provided for, or
shall be adjudicated to be so provided for, Tenant shall not be obligated to pay
such interest in excess of the maximum amount permitted by law, the right to
demand the payment of any such excess shall be, and hereby is, waived and any
such excess interest nonetheless paid to Landlord shall be promptly resumed to
Tenant.
ARTICLE 17
LANDLORD'S REMEDIES
17.1 Upon the occurrence of any Event of Default.
(a) Landlord or its agents or representatives may with or
without terminating the Lease re-enter and resume possession of the Leased
Premises and the Improvements, either by summary proceedings or by a suitable
action or proceeding at law or otherwise, without being liable for any damages
therefor, and no such reentry by Landlord shall be deemed an acceptance of a
surrender of this;
(b) the rent (the aggregate of all Fixed Net Rent, CPI
Rent and additional rent) shall become due thereupon and be paid up to the time
of such reentry, dispossess and/or termination, together with such counsel fees
and expenses as Landlord may incur in connection therewith;
(c) Landlord may, in its own name, but as agent for
Tenant (if this Lease is not terminated) or on its own behalf (if this Lease is
terminated):
(i) relet the whole or any portion of the Leased
Premises and/or the Improvements for any period equal to, or greater or less
than, the remainder of the Term, for any sum that it deems reasonable
(including, without limitation, free rent concessions), to any tenant that it
may deem suitable and satisfactory and for any use and purpose that it may deem
appropriate; and
(ii) in connection with any such reletting, make
such changes in the character of the Improvements as Landlord may determine to
be appropriate or helpful in effecting such lease, provided, however, that
Landlord shall, in no event, be:
(x) under any obligation to relet the
Leased Premises or the Improvements other than to undertake commercially
reasonable efforts to do so; or
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(y) required to pay to Tenant any
surplus of any sums received by Landlord on a reletting of the Leased Premises
or the Improvements in excess of the Fixed Net Rent and additional rent reserved
in this;
(d) Tenant shall pay to Landlord an amount equal to any
out-of-pocket costs and expenses (including, without limitation, attorneys'
fees, disbursements and court costs) incurred by Landlord in re-entering,
repairing and reletting of the Leased Premises and the Improvements, as well as
all costs and expenses incurred by Landlord for the care of the Leased Premises
and the Improvements while vacant, which amounts shall be due and payable by
Tenant to Landlord at such time or times as such costs and expenses shall have
been incurred by Landlord; and
(e) Unless this Lease has terminated, Tenant shall also
pay to Landlord, at the same time as its other rent obligations are payable, as
damages for the failure of Tenant to observe and perform Tenant's covenants
herein contained, any deficiency for each month of the period that would have
otherwise constituted the balance of the Term between:
(i) Fixed Net Rent and additional rent hereby
reserved and/or covenanted to be paid for such month; and
(ii) the net amount, if any, of the rents
collected for such month on account of any re-letting of the Leased Premises,
and, in computing such damages, there shall be added to the deficiency such
out-of-pocket expenses as Landlord may incur in connection with re-letting,
including, without limitation, legal expenses, attorneys' fees, disbursements
and court costs, brokerage and the costs and expenses of keeping the Leased
Premises in good order and preparing the same for reletting.
The damages described in subsection (e) shall be paid in installments by Tenant
on the rent day specified in this Lease, and any suit brought by Landlord to
collect the amount of the deficiency for any period shall not prejudice in any
way the right of Landlord to collect the deficiency for any subsequent period by
a similar action or proceeding. Nothing contained herein shall be deemed to
require Landlord to postpone suit until the date when the Term of this Lease
would have expired if it had not been so terminated by reason of Tenant's
default.
17.2 Upon the termination of this Lease by Landlord, Landlord
shall, at its sole discretion, in lieu of the damages described in subsection
(e) of Section 17. 1, be entitled to receive, as liquidated damages, an amount
equal to the difference between:
(a) the aggregate of all Fixed Net Rent and CPI Rent and
additional rent reserved hereunder for the then unexpired portion of the Term
(conclusively presuming that the CPI Rent and the additional rent for each year
included in such unexpired portion of the Term will escalate at the rate of
three (3%) per annum), discounted to present value at a rate
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equal to the prime, base, index or refinance interest rate publicly announced by
The Chase Manhattan Bank, N.A., in effect as of the date of default minus 2% per
annum; and
(b) the then fair and reasonable rental value of the
Leased Premises for the same period.
If the Leased Premises, or any part thereof, is re-let by Landlord for the
unexpired portion of the Term, or any part thereof, before presentation of proof
of such liquidated damages to any court, commission, or tribunal, the amount of
rent reserved upon such reletting shall be prima facie evidence that it is the
fair and reasonable rental value for such part or the whole of the Leased
Premises so re-let during the term of the re-letting.
17.3 Landlord, at its option, may make such alterations,
replacements and/or decorations in and to the Leased Premises and/or the
Improvements as Landlord, in Landlord's sole judgment, considers advisable and
necessary for the purpose of re-letting the Leased Premises and/or the
Improvements for similar uses, and the making of such alterations, replacements
and/or decorations shall not operate or, be construed, to release Tenant from
liability hereunder as aforesaid.
17.4 Landlord shall not be liable to Tenant in any respect
whatsoever for Landlord's failure to re-let the Leased Premises and/or the
Improvements provided that it has undertaken commercially reasonable efforts to
do so or, in the event that the Leased Premises and/or the Improvements are
re-let, for Landlord's failure to collect the rent thereof under such
re-letting. No such failure shall relieve Tenant's liability for, and obligation
to pay, all of the amounts which Landlord shall be entitled under this Article
17 or otherwise at law or in equity.
17.5 In the event of a breach by Tenant or Landlord of any of the
covenants or provisions of this Lease, the non-breaching party shall have the
right of injunction, as well as to invoke any remedy allowed at law or in
equity, as if re-entry, summary proceedings and other remedies were not herein
provided for.
17.6 Nothing contained in this Article 17 shall be construed to
limit or preclude recovery by Landlord against Tenant of any sums or damages to
which, in addition to the damages particularly provided above, Landlord may
lawfully be entitled by reason of any default hereunder on the part of Tenant.
ARTICLE 18
TENANT TO INDEMNIFY LANDLORD
18.1 Tenant shall not do any act or thing upon the Leased Premises
or the Improvements, or permit any such act or thing to be done, that may
subject Landlord to any liability by reason of any illegal business or conduct
upon the Leased Premises or the Improvements or by reason of any violation of
law or of any legal requirement of public
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authority, or by reason of any other cause whatsoever. In addition to the
provisions of Section 9.3(h) above, Tenant agrees to defend and shall indemnify
and hold Landlord harmless for, from and against and from any and all liability,
fines, suits, claims, demands, actions, costs and expenses of each and every
kind or nature whatsoever to the fullest extent permitted by law (including,
without limitation, reasonable attorneys' fees disbursements and court costs)
due to or arising out of any:
(a) breach, violation, or non-performance of any term,
covenant, or condition of this Lease on the part of Tenant to be fulfilled,
kept, observed, or performed; and/or
(b) injury to any person or persons (including, without
limitation, the death of any person or persons) or damage to any property
occurring in or about the Leased Premises and/or the Improvements at any time
during the Term, whether or not such injury or damage is occasioned by Tenant's
use and occupancy of the Leased Premises and/or the Improvements, by any use or
occupancy that Tenant may permit or suffer to be made thereof.
If Tenant is required to defend any action or proceeding pursuant to this
Article 18 to which Landlord is made a party, Tenant shall do so through counsel
reasonably acceptable to Landlord (provided, however, that counsel selected by
Tenant's insurance carrier shall be deemed to be acceptable to Landlord).
Landlord shall reasonably cooperate with Tenant's counsel in connection with
resolving the action or proceeding, provided, however, that Landlord shall not
be required to expend any money with respect thereto or to undertake any action
not consistent with its own best interests. Landlord shall be entitled to
participate in such defense, at its election, by counsel of its own choosing and
at Tenant's expense, and Tenant and its counsel shall consult and otherwise
cooperate with Landlord's counsel in all reasonable respects in connection with
such participation provided that neither Tenant nor its counsel shall be
required to expend any money with respect thereto and such participation by
Landlord does not limit or render void any liability of any insurer of Landlord
or Tenant hereunder in respect to the claim or matter in question. Tenant's
liability under this Article 18 shall be reduced by the net proceeds actually
collected on any insurance effected by Tenant on the risks in question for
Landlord's benefit, recovered by Landlord under Tenant's policies. However,
nothing contained in this Article 18 shall vary the insurance requirements
contained in Article 12.
ARTICLE 19
MECHANICS' LIENS
19.1 Notice is hereby given that Landlord shall not be liable for
any labor or materials furnished, or to be furnished, to Tenant, and that no
mechanic's or other lien for any such labor or materials shall attach to, or
otherwise affect, the reversion or other estate or interest of Landlord in and
to the Leased Premises or the Improvements.
19.2 Tenant covenants that, whenever and as often as any mechanic's
lien shall have been filed against the Leased Premises or the Improvements,
other than any mechanic's lien
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that shall have been filed based upon any act or omission of Landlord or anyone
acting on behalf of Landlord, Tenant shall forthwith (and in any event, within
thirty (30) days) take such action, by bonding, deposit, or payment, as will
remove or satisfy the lien.
ARTICLE 20
CONDEMNATION
20.1 If, at any time during the Term, any person or corporation,
municipal, public, private or otherwise, shall lawfully condemn and acquire
title to all or substantially all of the Leased Premises in or by condemnation
proceedings in pursuance of any law, general, special, or otherwise or by
agreement between Landlord, Tenant and those authorized to exercise such right:
(a) this Lease and the Term shall terminate and expire on
the date of such taking; and
(b) the Fixed Net Rent and additional rent herein
reserved and provided to be paid by Tenant shall be apportioned and paid to the
date of such taking.
20.2 If less than all or substantially all of the Leased Premises
shall be taken as aforesaid, (i) if it is economically infeasible for Tenant to
operate its business in the manner so operated immediately prior to the taking
(any disputes as to such infeasibility shall be subject to arbitration in the
manner provided in Article 21), Tenant may terminate this Lease as to the
location so taken, and in all other cases (ii) this Lease and the Term shall
continue notwithstanding such taking, but the Fixed Net Rent thereafter payable
by Tenant shall be equitably apportioned and reduced, as and from the date of
such partial taking, which apportionment and reduction shall be made only as and
when the particular award shall ultimately be received by Landlord. If Landlord
and Tenant cannot mutually agree upon such equitable apportionment and
reduction, it shall be determined by arbitration in the manner provided in
Article 21.
20.3 In the event of a partial condemnation where Tenant is
obligated to restore, the net proceeds of the award shall be made available to
Tenant for such purpose. The rights of Landlord and Tenant in and to the award
and/or damages which are not used for restoration upon any taking of all or a
portion of the Leased Premises (including, without limitation, the value of the
fee estate of Landlord, the value of the leasehold estate of Tenant, the
consequential damages to the part of the Leased Premises not taken and the cost
of reconstruction) shall be determined as follows:
(a) first, Landlord shall be entitled to receive the
aggregate amount, with interest thereon, that shall represent compensation for:
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(i) the value of Landlord's reversionary estate
and interest in and to the entire Leased Premises or the portion of the Leased
Premises taken, as the case may be; and
(ii) if the entire Leased Premises shall not be
taken, the amount of any consequential damages to Landlord's reversionary estate
and interest in and to the portion of the Leased Premises not taken;
(b) second, to the extent that the award and/or damages
upon such taking shall be sufficient therefor, Landlord shall be entitled to
receive an amount. with interest thereon, equal to the "Lost Rental
Compensation" (as such term is defined below); and
(c) third, Tenant shall be entitled to receive any
balance of the award and/or damages remaining after Landlord shall be paid the
amounts described in subsections (a) and (b) above.
In the event that the total amount of the award and/or damages upon any taking
of all or a portion of the Leased Premises shall be insufficient to pay Landlord
all of the amounts described in subsections (a) and (b) above, Tenant shall pay
to Landlord, within thirty (30) days after Landlord's written demand therefor as
additional rent under this Lease, the amount of the deficiency with interest
thereon, it being the intent and understanding of the parties that Landlord
shall receive from Tenant and/or the condemning authority, as the case may be,
and retain for its own account, in an events whatsoever, a net payment to the
sum of the amounts described in subsections (a) and (b) above, with interest
thereon. Tenant's obligation to pay any deficiency and/or interest to Landlord
hereunder shall survive the termination and/or expiration of this Lease and/or
the Term. As such term is used in this Section 20.3. the term "LOST RENTAL
COMPENSATION" shall mean, either:
(a) as to a taking that shall result in the termination
of this Lease and the Term pursuant to Section 20.1 above, an amount equal to
the aggregate of the Fixed Net Rent reserved hereunder for the then unexpired
portion of the Term (conclusively presuming that the CPI Rent for each year
included in such unexpired portion of the Term will be the same as was payable
for the year immediately preceding the termination of this Lease), discounted to
present value at a rate equal to two (2%) percent below the so-called prime,
base, index, or reference interest rate publicly announced by The Chase
Manhattan Bank, N.A., in effect as of the date of the taking; or
(b) as to a taking that shall not result in the
termination of this Lease and the Term pursuant to Section 20.1 above, an amount
equal to the aggregate of the reductions in the Fixed Net Rent reserved
hereunder pursuant to Section 20.2 above for the then unexpired portion of the
Term (conclusively presuming that the CPI Rent for each year included in such
unexpired portion of the Term will be the same as was payable for the year
immediately preceding the termination of this Lease), discounted to present
value at a rate equal to two (2%)
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percent per annum less than the so-called prime, base, index, or reference
interest rate publicly announced by The Chase Manhattan Bank. N.A., in effect as
of the date of the taking.
20.4 If any or all of the amounts due to Landlord pursuant to
Section 20.3 above shall not be fixed in the proceedings for such taking in
accordance with the agreement of the parties set forth in Section 20.3, and if
the parties shall not agree in writing as to the unfixed amount or amounts to be
paid to Landlord thereunder within ninety (90) days after the date of the final
determination in such proceedings, such unfixed amount or amounts shall be
determined by arbitration in the manner provided in Article 21.
20.5 Except as otherwise provided elsewhere herein. if the
Improvements shall be damaged or partially destroyed by any taking of less than
all or substantially all of the Leased Premises, Tenant shall proceed, with
reasonable diligence and at Tenant's own cost and expense, to conduct any
necessary demolition and to repair, replace, or rebuild any remaining part of
the Improvements not so taken, so as to constitute such remaining part thereof a
complete and rentable building, in good condition and repair, having a
configuration, design and suitability for nature of use as similar as is
practicable under the circumstances to the configuration, design and suitability
for nature of use of the Leased Premises immediately prior to the taking. Tenant
shall cause to be paid to an independent Depositary reasonably satisfactory to
Landlord in trust, any portion of the award and/or damages upon such
condemnation to be received and retained by Tenant pursuant to the terms in
Section 20.3 above, to apply the same to cost and expense of such demolition,
repair, replacement and rebuilding by whatsoever incurred. If such amount
received and retained by Tenant is insufficient to pay for the cost of such
demolition, repair, replacement and/or rebuilding, Tenant shall make up the
deficiency at its own cost and expense. Conversely, if such amount received and
retained by Tenant is more than sufficient to pay the cost of such demolition,
repair, replacement and/or rebuilding the amount of any excess remaining after
such demolition, repair, replacement and/or rebuilding is completed and the cost
thereof is fully paid shall belong to Tenant. The provisions of Articles 5.8,
9, 13, 18 and 19 shall apply to the work required to be done under this Section
20.5 and to the disbursement of the condemnation proceeds.
20.6 If, at any time during the Term, any person or corporation,
municipal, public, private, or otherwise, shall lawfully condemn and acquire the
temporary use of the Leased Premises in or by condemnation proceedings in
pursuance of any law, general, special, or otherwise, or by agreement with
Landlord, Tenant and those authorized to exercise such right:
(a) the Term shall not be reduced or affected in any way;
(b) Tenant shall continue to pay the full Fixed Net Rent
and additional rent herein reserved and provided to be paid by Tenant; and
(c) Tenant shall be entitled to make claim for. recover
and retain any award or awards, whether in the form of rental or otherwise,
recovered in respect of such possession or occupancy, provided, however, that,
if such possession or occupancy shall extend
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beyond the date fixed as the Expiration Date, the award shall be apportioned
between Landlord and Tenant as of such date.
ARTICLE 21
ARBITRATION
21.1 In the event of a dispute between Landlord and Tenant with
respect to any issue of fact (other than one determined by a condemnation court)
arising out of a taking referred to in Article 20 or specifically mentioned and
provided for elsewhere in this Lease as a matter to be decided by arbitration,
such dispute shall be determined by arbitration as provided in this Article 21.
21.2 Landlord and Tenant shall each appoint as an arbitrator a fit
and impartial person from a panel proposed by the American Arbitration
Association who shall have had at least ten (10) years' experience in the City,
County and State where the property is located in a calling connected with the
subject matter of the dispute. Such appointment shall be signified in writing by
each party to the other. If either Landlord or Tenant shall fail to appoint an
arbitrator as set forth in this Section 21.2 for a period of twenty (20) days
after written notice from the other party to make such an appointment, then the
arbitrator appointed by the party who shall have made such an appointment shall
appoint the second arbitrator.
21.3 The arbitrators. after being duly sworn to perform their
duties with impartiality and fidelity, shall proceed with all reasonable
dispatch to determine the question submitted, by first appointing an umpire,
whose determination shall be conclusive in the event that the arbitrators and
the umpire shall fail to render their decision within thirty (30) days after
their appointment. The arbitration shall be conducted in accordance with the
Commercial Arbitration Rules of the American Arbitration Association, and the
award of the arbitrators and/or umpire shall be binding, final and conclusive
and non-appealable by the parties. The decision of the arbitrators and/or umpire
shall be rendered within thirty (30) days after their appointment, and such
decision shall be in writing and in duplicate, one counterpart thereof to be
delivered to each of the parties. If within ten (10) days after their
appointment. the arbitrators fail to agree upon the identity of the person to
act as umpire, such umpire shall be appointed by the American Arbitration
Association from its qualified panel of arbitrators, and shall be a person
having at least ten (10) years' recent experience as to the subject matter in
question.
21.4 If an umpire is appointed as provided in Section 21.3, the
arbitrators and the umpire, after the umpire is duly sworn to perform his or her
duties with impartiality and fidelity, shall proceed with all reasonable
dispatch to determine the question submitted.
21.5 The fees of the arbitrators and any umpire. as well as the
expenses incident to the proceedings, shall be borne by the party whose written
position stated before the commencement of the arbitration, is furthest from the
determination of the arbitrator (or, if neither party's position is upheld, such
fees and expenses shall be borne by the parties equally).
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The fees of respective counsel engaged by the parties. and the fees of expert
witnesses and other witnesses called or engaged by the parties, shall be paid by
respective party engaging such counsel or calling or engaging such witnesses.
21.6 Wherever in this Lease it is provided that Landlord's consent
or approval shall not be unreasonably withheld (or word of like import), if
Landlord shall withhold its consent or approval such adverse determination by
Landlord shall be an arbitrable dispute as provided in this Article 21. Ten (10)
days after Tenant's receipt of Landlord's adverse determination, Landlord's
determination shall be conclusive, unless prior to the end of such 10 day period
Tenant shall give notice of demand for arbitration under this Article 21, in
which event Landlord, within 10 days after receipt of Tenant's demand, shall (if
Landlord has not already done so) specify in writing Landlord's reasons for the
adverse determination. Anything in this Article 21 to the contrary
notwithstanding, (i) the proceeding referred to in this Section 21.6 shall occur
on an expeditious basis, with all time periods for performance at any stage of
the arbitration proceeding to be 10 days, rather than 20 or 30 days as provided
above, and (ii) the losing party shall pay all costs of such arbitration,
including the legal fees and witness or expert fees of the prevailing party. The
submission to arbitration in accordance with this Lease shall be the sole remedy
of Tenant as respect to any consent or approval which may not be unreasonably
withheld. If a determination is made by the arbitrators that the withholding of
consent or approval was unreasonable the arbitrators shall annul such
withholding of consent or approval. Except for the costs and expenses referred
to above, no damages of any kind, and no other monetary or other remedy may be
awarded in such circumstances, it being agreed that such annulment shall be
Tenant's sole remedy.
ARTICLE 22
SHORING
22.1 To the extent required by law, Tenant shall allow an adjoining
owner desiring to excavate on its premises, or a municipality desiring to
excavate a nearby street, to enter onto the Leased Premises and the Improvements
and shore up a perimeter wall during such excavation. Tenant shall, at Tenant's
own expense, repair, or cause to be repaired, any damage caused to any part of
the Leased Premises and/or the Improvements because of any excavation,
construction work, or other work of a similar nature that may be done on any
property adjoining or adjacent to the Leased Premises, and Landlord hereby
releases to Tenant any and all rights to sue for and/or recover against such
adjoining owners, or the parties causing such damages, the amounts expended or
injuries sustained by Tenant because of the provisions of this Article 22
requiring Tenant to repair any damages sustained by such excavations,
construction work, or other work.
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ARTICLE 23
WAIVER OF REDEMPTION
23.1 Tenant, for itself and for all persons claiming through or
under it, hereby expressly waives any and all rights which are or may be
conferred upon Tenant by any present or future law to redeem the Leased
Premises, or to any new trial in any action of ejectment under any provision of
law, after re-entry thereupon, or upon any part thereof, by Landlord, or after
any warrant to dispossess or judgment in ejectment. If Landlord shall have
acquired possession of the Leased Premises by summary proceedings, or in any
other lawful manner without judicial proceedings, it shall be deemed a re-entry
within the meaning of that word as used in this Lease.
ARTICLE 24
[INTENTIONALLY OMITTED.]
ARTICLE 25
COVENANT OF QUIET ENJOYMENT
25.1 If, and for so long as, Tenant shall pay the Fixed Net Rent
and additional rent reserved by or payable pursuant to this Lease, and shall
perform and observe all of the other terms, covenants and conditions herein
contained on the part of Tenant to be performed and observed, Tenant shall
quietly enjoy the Leased Premises, subject, however, to the terms, covenants and
conditions of this (including, without limitation, the terms of Article 34), to
the ground leases, underlying leases, overriding leases and mortgages referred
to in Article 4 and to the matters relating to title. However, no failure by
Landlord to comply with the foregoing covenant shall give Tenant any right to
cancel or terminate this Lease, to abate, reduce, or make any deduction from, or
offset against, the Fixed Net Rent or additional rent payable under this Lease,
or to fail to perform any other obligation of Tenant hereunder.
ARTICLE 26
NON-MERGER
26.1 There shall not be a merger of:
(a) Tenant's interest in this Lease or the leasehold
estate created
hereby;
(b) Tenant's interest in the improvements; or
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(c) the fee estate in the Leased Premises or any part
thereof,
by reason of the fact that the same person may acquire, own, hold, directly or
indirectly, all or part of the interests or estates described in subsections
(a), (b) and/or (c) above and no such merger shall occur unless and until all
persons (including, without limitation, Landlord, Tenant and all mortgagees)
having an interest in all of such interests and estates shall join in a written
instrument effecting such merger and shall duly record the same.
ARTICLE 27
WAIVER OF COUNTERCLAIM AND JURY TRIAL
27.1 In the event that Landlord shall commence any summary
proceeding or action for non-payment of rent or of additional rent hereunder,
Tenant shall not interpose any counterclaim of any nature or description in such
proceeding or action. The parties hereto waive a trial by jury on any or all
issues arising in any action or proceeding between them or their successors
under or connected with this Lease or any of its provisions, any negotiations in
connection therewith, or Tenant's use or occupation of the Leased Premises.
ARTICLE 28
ASSIGNMENT AND SUBLETTING
28.1 Provided that no Event of Default shall have occurred and be
continuing under this Lease and except as hereinafter provided in this Article
28. Tenant shall have the right to assign this Lease and Tenant's rights
hereunder, whether in whole or in part, or to sublet the entire, or portions of,
the Leased Premises only with Landlord's prior written consent, which shall not
be unreasonably withheld. As to any assignment or subletting in which the use
shall be and remain a new car automobile dealership and activities incidental
thereto, Landlord's prior consent shall not be required, so long as all of the
following conditions are met: (i) such assignment or subletting is made
concurrently with the sale of, or move by Tenant of, substantially all of the
business and assets of an automobile dealership franchise being operated at such
property by Tenant or its subsidiary immediately prior to such assignment or
subletting (however, in the case of a move from such location by Tenant or its
subsidiary, another automobile dealership franchise is to be operated thereon)
to the assignee or subtenant, and such operation is and shall remain a new car
automobile dealership and activities incidental thereto, (ii) such assignee or
subtenant has been qualified and approved by the automobile manufacturer, and
(iii) a security deposit equivalent to one month's rent shall be deposited with
Landlord, and (iv) Tenant's liability hereunder and the Guaranty of Tenant's
performance hereunder by Boomershine Automotive Group, Inc., its successors and
assigns ("Guarantor") following such subletting shall remain in full force and
effect and Tenant and said Guarantor shall confirm the same in writing at the
request of Landlord.
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28.2 In connection with any assignment or subletting (whether or
not approved or required to be approved by Landlord) Tenant and the assignee or
subtenant shall each comply with the following terms, covenants and conditions,
which shall be conditions precedent thereto:
(a) Tenant shall give Landlord written notice of each
such assignment or subletting, as well as of the effective date thereof, not
less than ten (10) days prior to the execution of such assignment or sublease;
(b) such assignment or subletting shall be in writing,
duly executed and acknowledged by Tenant and the assignee (and by the sublessee,
in the case of a subletting) in proper form for recording, and in form prepared
by or reasonably approved by Landlord;
(c) a duplicate original of such assignment or sublease
shall be delivered to Landlord not more than ten (10) days after the execution
of such assignment or sublease;
(d) the business to be conducted on the Leased Premises
by such assignee or subtenant shall:
(i) be permitted pursuant to the then existing
Certificate of Occupancy for the Leased Premises or pursuant to any revised or
amended Certificate of Occupancy obtained by Tenant or by the assignee or
subtenant; and
(ii) not render the Leased Premises incapable of
being used or occupied after the expiration or sooner termination of the Term of
this Lease for the purposes for which the same were use and occupied on the
Commencement Date
(e) such assignment or sublease shall be consistent with,
and subordinate and subject to, all of the terms, covenants and conditions of
this Lease.
(f) if the transaction in question is an assignment,
Landlord shall receive. prior to the effective date thereof, an original
counterpart of an instrument, signed by the assignee in recordable form,
pursuant to which the assignee agrees to unconditionally assume all of the
obligations of this Lease on the part of the tenant hereunder to perform from
and after the effective date thereof;
(g) if the transaction in question is a sublease, the
expiration date of the Term thereof shall not be later than one (1) day prior to
the Expiration Date hereunder;
(h) if the transaction in question is a sublease, the
sublease shall contain a provision to the effect that (i) such sublease is
subject and subordinate to all of the terms and provisions of this Lease and to
the rights of Landlord hereunder, (ii) in the event this Lease shall terminate
or be rejected before the expiration of such sublease, the sublessee either will
at Landlord's option, attorn to Landlord or waive any right the sublessee may
have to
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terminate the sublease or surrender possession thereunder, as a result of the
termination of this Lease and (iii) in the event the sublessee thereunder
receives a written notice from Landlord stating that Tenant is under default
under this Lease beyond any applicable notice or cure period, that the sublessee
shall then and after be obligated to pay all rentals accruing under said
sublease directly to Landlord such notice, or as Landlord may otherwise direct,
unless and until notified otherwise by Landlord;
(i) notwithstanding anything herein to the contrary, no
proposed assignment of this Lease by Tenant or subletting of all or a portion of
the Leased Premises shall be permitted if such assignment or subletting would
provide for a rental or other payment for the leasing, use, occupancy or
utilization of all or any portion of the Leased Premises based, in whole or in
part, on the income or profits derived by any person from the property so
leased, used, occupied or utilized other than an amount based on a fixed
percentage or percentages of gross receipts or sales.
No such assignment or sublease shall release, or otherwise affect or reduce, the
obligations of Tenant under this Lease or of any guarantors of this Lease.
28.3 (a) Tenant shall have the right, without the consent of
Landlord, to assign this Lease or sublet the Leased Premises or portions thereof
to any "Related Entity" or Successor Entity" (as hereinafter defined), provided,
however, that Tenant and such Related Entity or Successor Entity shall by
jointly and severally liable for all of the covenants and obligations of Tenant
in this Lease. As used herein, the term "RELATED ENTITY" means any entity
controlled by Tenant, but only if such assignee or sublessee entity continues to
remain at all times controlled by Tenant while such entity is a tenant or
sublessee with respect to all or any portion of the Leased Premises, and the
term "SUCCESSOR ENTITY" means any entity resulting from the merger,
consolidation or acquisition of all or substantially all of the assets and
business or a majority of the voting stock or voting control of Tenant.
Notwithstanding the foregoing, an assignment or subletting to a Successor Entity
may be made without Landlord's consent on any two occasions and thereafter shall
be subject to Landlord's consent under this Article 28.
(b) For the purposes of this Lease, the sale or issuance
of stock or other interests of Tenant (other than a public offering or the sale
of Tenant's stock on a publicly traded stock exchange) or a merger or
consolidation or other transaction whereby control of Tenant's interest in this
Lease and/or all or any portion of this Leased Premises is transferred shall be
an "assignment" subject to the provisions of this Article 28, unless made with
or to a Related Entity or Successor Entity, in which event Section 28.3(a) shall
be applicable.
28.4 In determining whether to consent to Tenant's proposed
assignment or subletting, the Landlord may consider all factors which in
Landlord's reasonable business judgment, are pertinent to such decision, and the
parties agree that the following, without limitation, are examples of such
factors:
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a. Whether the financial strength of the proposed
assignee (including net worth and working capital)
are sufficient to assure the future performance by
such assignee of its obligation under this Lease;
b. The character, business reputation, and managerial
skills of the assignee or subtenant;
c. Whether the assignee or subtenant, has substantial
experience in the sale, service and leasing of motor
vehicles or other uses permitted by this Lease; and
d. Whether the use of the Leased Premises by the
proposed assignee or subtenant is identical to the
use conducted prior to such assignment or subletting.
In the event a dispute should arise between Landlord and Tenant as to whether
Landlord has acted reasonably in failing to give its consent to any
proposed assignment or sublease, Tenant's sole remedy shall be an action for an
arbitration on such issue pursuant to Article 21 above, and in no event shall
Landlord be liable to Tenant for any damages (direct or consequential) allegedly
suffered by Tenant or any such assignee or subtenant as a result of such failure
to consent.
28.5 (a) Any consent by Landlord to an assignment or
subletting or use or occupancy by others shall be held to apply only to the
specific transaction thereby authorized and shall not constitute a waiver of the
necessity for such consent to any subsequent assignment or subletting or use or
occupancy by others, including, but not limited to, a subsequent assignment or
subletting by any trustee, receiver liquidator, or personal representative of
Tenant, nor shall the references anywhere in this Lease to subtenants, licensees
and concessionaires be construed as a consent by Landlord to an assignment. If
this Lease or any interest herein be assigned or if the Leased Premises be
sublet or used or occupied in whole or in part by anyone other than Tenant, with
or without Landlord's prior written consent having been obtained thereto,
Landlord may nevertheless collect rent (including but not limited to, Fixed Net
Rent, CPI Rent and additional leased rent) from the assignee, sublessee, user or
occupant and apply the net amount collected to the rents herein reserved. No
such assignment, subletting, use, occupancy or collection shall be deemed a
waiver of the covenant herein against assignment, subletting or use or occupancy
by others, or the acceptance of the assignee, subtenant, user or occupant as
Tenant hereunder, or constitute a release of Tenant from the further performance
by Tenant of the terms and provisions of this Lease, or a cure of Tenant's
default.
(b) In the event of a sublease, in no event will Landlord be
obligated to give any notice to or join such sublessee in any proceeding
Landlord institutes against Tenant, or recognize the continued existence of such
sublessee as Landlord's tenant in the event Tenant defaults under this Lease,
and the agreement, sublease and/or other agreement relating to the portion of
the Leased Premises in question between Tenant and the sublessee will by their
own
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terms automatically end upon the expiration or sooner termination of this Lease
unless Landlord, at its option, requests such sublessee to attorn to Landlord.
(c) In all cases in which Tenant desires to assign or sublet this
Lease, Tenant shall send Landlord an assignment notice not less than sixty (60)
days prior to the proposed date of such assignment and subletting ("ASSIGNMENT
NOTICE"), which Assignment Notice shall include, inter alia, (i) the name of the
proposed assignee or subtenant: (ii) the current financial statement showing the
net worth working capital and liabilities of Tenant; (iii) a "resume" or other
description setting forth the managerial experience of such assignee or
subtenant; (iv) a list of other locations (and trade names if different from the
trade name to be utilized in the proposed location) then operated by such
assignee or subtenant; (v) a complete description of the use of the Leased
Premises intended by such assignee or subtenant; and (vi) if then available, a
copy of the proposed assignment and assumption agreement or sublease, as the
case may be, which must be in form and substance reasonably acceptable to
Landlord. In addition, Tenant will supply such other information as Landlord may
reasonably require to make its decision as to whether or not to consent to the
proposed assignment or subletting. If the proposed assignment and assumption
agreement or sublease is not available at the time Tenant submits its Assignment
Notice to Landlord, such assignment or sublease shall not be deemed to be
effective unless and until Landlord approves the applicable agreement.
(d) Upon the occurrence of any assignment or subletting. whether
voluntary, involuntary, by operation of law, or otherwise, without the prior
written consent of Landlord where required (whether or not Tenant shall have
given notice thereof to Landlord), Landlord may treat any such occurrence as an
immediate Event of Default.
ARTICLE 29
NOTICES
29.1 Any notice, demand, election, or other communication
(hereinafter called a "NOTICE") that, under the terms of this Lease or under any
statute, must or may be given by the parties hereto shall be in writing and
shall be given in the manner hereinafter set forth in this Article 29,
addressed:
(a) in the case of notices to Landlord, to Landlord at:
c/o Kimco Realty Corporation
3333 New Hyde Park Road - Suite 100
P.O. Box 5020
New Hyde Park, NY 11042-0020
Attention: General Counsel
Fax: (516) 869-7117
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with a copy at the same time to:
Wolf, Block, Schorr & Solis-Cohen, LLP
Twelfth Floor Packard Building
11 South 15th Street
Philadelphia, PA 19102
Attention: Alvin H. Dorsky, Esquire
Fax: (215) 977-2727
(b) in the case of notices to Tenant, to Tenant at:
4910 Sylva Highway
Franklin, NC 28734
with copies to:
Sunbelt Automotive Group, Inc.
5901 Peachtree Dunwoody Road
Atlanta, GA 30328
Attn: General Counsel
Fax: (678) 443-8124
Either Landlord or Tenant may designate, by notice in writing, a new or other
address to which notices shall thereafter be given. Any notice given hereunder
shall be deemed given three (3) business days after the same is deposited in a
United States general or branch post office, or in an official United States
mail depositary, by prepaid certified mail wrapper, return receipt requested,
the later of one day after sent by a nationally recognized overnight courier
service, charges prepaid for next day delivery or the date upon which delivery
shall be made or tendered, addressed as hereinabove provided or upon delivery,
if hand delivered.
No notice from Tenant to Landlord the effect of which would be that
Landlord's approval, consent or other response would be deemed given in the
absence of a response thereto from Landlord, shall be deemed to have been given
to Landlord and Landlord shall not be bound thereby, unless such notice
expressly refers to the provision of this Lease pursuant to which the notice is
given and sets forth that if Landlord fails to respond within the applicable
time period (which shall be stated in the notice), its approval or consent will
be deemed to have been given.
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ARTICLE 30
BROKER
30.1 Landlord and Tenant covenant, warrant and represent that there
was no broker or finder instrumental in consummating this Lease and that no
conversations or negotiations were had with any broker or finder concerning the
leasing of the Leased Premises.
ARTICLE 31
WAIVERS AND SURRENDERS TO BE IN WRITING
31.1 The receipt of rent by Landlord, with knowledge of any breach
of this Lease by Tenant or of any default on the part of Tenant in the
observance or performance of any of the conditions or covenants of this Lease,
shall not be deemed to be a waiver of any provision of this Lease. No failure on
the part of Landlord or Tenant to enforce any covenant or provision herein
contained, nor any waiver of any right hereunder by Landlord or Tenant (unless
such waiver is in a writing signed by the party to be charged), shall discharge
or invalidate such covenant or provision, or affect the right of Landlord or
Tenant to enforce the same in the event of any subsequent breach or default. The
receipt by Landlord of any rent, or other sum of money, or any other
consideration paid by Tenant after the expiration or termination, in any manner
of the Term shall not reinstate, continue, or extend the Term, unless so agreed
to in writing and signed by Landlord. Neither acceptance of the keys to any
Improvement, nor any other act or thing done by Landlord or any agent or
employee during the Term, shall be deemed to be an acceptance of a surrender of
the Leased Premises excepting only an agreement in writing signed by Landlord
accepting or agreeing to accept such a surrender.
ARTICLE 32
RIGHTS AND REMEDIES CUMULATIVE
32.1 The rights given to Landlord herein are in addition to any
rights that may be given to Landlord by any statute or otherwise. All of the
rights and remedies of Landlord under this Lease or pursuant to present or
future law shall be deemed to be separate, distinct and cumulative, and no one
or more of them, whether exercised or not, nor any mention of, or reference to,
any one or more of them in this Lease shall be deemed to be in exclusion of, or
a waiver of, any of the others, or of any of the other rights or remedies that
Landlord may have, whether by present or future law or pursuant to this Lease.
Landlord shall have, to the fullest extent permitted by law, the right to
enforce any rights or remedies separately, and to take any lawful action or
proceedings to exercise or enforce any right or remedy, without thereby waiving,
or being barred or estopped from exercising and enforcing, any other rights and
remedies by appropriate action or proceedings.
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32.2 Except where Tenant's rights or remedies are expressly limited
by this Lease: the rights given to Tenant herein are in addition to any rights
that may be given to Tenant by any statute or otherwise; all of the rights and
remedies of Tenant under this Lease or pursuant to present or future law shall
be deemed to be separate, distinct and cumulative; no one or more of them,
whether exercised or not, nor any mention of, or reference to, any one or more
of them in this Lease, shall be deemed to be in exclusion of, or a waiver of,
any of the others Tenant may have, whether by present or future law or pursuant
to this Lease; and Tenant shall have, to the fullest extent permitted by law,
the right to enforce any such rights or remedies separately, and to take any
lawful action or proceedings to exercise or enforce any such right or remedy,
without thereby waiving, or being barred or estopped from exercising and
enforcing, any other rights and remedies by appropriate action or proceedings.
ARTICLE 33
REMOVAL OF PERSONAL PROPERTY AND FIXTURES
33.1 Tenant shall, on or before the last day of the Term, or on the
sooner termination thereof, peaceably and quietly leave, surrender and yield up
unto Landlord all and singular the Leased Premises and the Improvements, free of
all subtenancies (except to the extent that Landlord shall have consented to the
continuation of such subtenancies), broomclean, together with all alterations,
additions and improvements that may have been made upon the Leased Premises
(except movable furniture, movable personal property, or movable trade fixtures
put in at the expense of Tenant, or at the expense of any subtenant, subject,
however, to the subsequent provisions hereof). All furniture, personal property
and trade fixtures properly removable pursuant to the provisions of this Article
33 shall be removed by Tenant on or before the last day of the Term, or on the
sooner termination thereof, and all property not so removed shall be deemed
abandoned by Tenant. If the Leased Premises and the Improvements are not so
surrendered at the end of the term, Tenant shall make good to Landlord all
damage that Landlord shall suffer by reason thereof, and shall indemnify
Landlord against all claims made by any succeeding tenant against Landlord
founded upon delay by Tenant in delivering possession of the Leased Premises to
such succeeding tenant, so far as such delay is occasioned by the failure of
Tenant to so surrender the Leased Premises. For purposes of this Lease "TRADE
FIXTURES" shall be deemed to include hydraulic lifts and other moveable
machinery and equipment used in connection with the operation of the business of
an automobile dealership, all of which shall be removed upon Landlord's demand.
33.2 Should Landlord incur any expense in removing any subtenant.
or any other Person holding by, through, or under Tenant, who has failed to so
surrender the Leased Premises, the Improvements, or any part thereof, Tenant
shall reimburse Landlord for the reasonable cost and expense (including, without
limitation, reasonable attorneys' fees, disbursements and court costs) of
removing such subtenant or such person, provided that Tenant shall have failed
to have effected such removal after written demand.
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ARTICLE 34
SALE OR CONVEYANCE OF LEASED PREMISES;
LIMITS OF LIABILITY OF LANDLORD
34.1 The term "LANDLORD", as used in this Lease, means only the
owner at any time of fee title to the Leased Premises, so that, in the event of
any sale of the Leased Premises, the seller shall be, and hereby is, entirely
freed and relieved of all covenants and obligations of Landlord hereunder
thereafter arising, and it shall be deemed and construed, without further
agreement between the parties or between the parties and the purchaser of the
Leased Premises, that such purchaser has assumed and agreed to carry out any and
all covenants and obligations of Landlord hereunder thereafter arising. If
Landlord and/or any successor in interest of Landlord shall be an individual or
individuals who are joint venturers, tenants in common, members of a firm, a
general or limited partnership, or a corporation, it is specifically understood
and agreed that the monetary liability of such individual, or of the members or
other principals of such firm, partnership, or joint venture, or of the
officers, directors and/or shareholders of such corporation, whether disclosed
or undisclosed, in relation to any covenants or conditions under this Lease
shall be unconditionally and completely limited to the equity of Landlord in the
Leased Premises, in the event of a breach by Landlord of any of the terms,
covenants and conditions of this Lease to be performed by Landlord. Except as
expressly otherwise provided in this Lease, there shall be no personal liability
with respect to any of the foregoing persons and/or entities.
ARTICLE 35
ALTERATIONS
35.1 (a) Provided that no Event of Default shall have occurred
and be continuing under this Lease, Tenant shall have the right:
(i) with Landlord's consent, which shall not be
unreasonably withheld or delayed, to make non-structural interior changes in, or
non-structural additions to, the Improvements; and
(ii) with Landlord's prior written consent, which
may be given or withheld in Landlord's sole and absolute discretion, to make
structural interior changes in, or additions to, the Improvements.
(b) In determining whether to consent to Tenant's
proposed non-structural interior changes in, or non-structural additions to the
Improvements, Landlord may consider all factors which in Landlord's reasonable
business judgment, are pertinent to such decision, and the parties agree that
the following are examples of such factors:
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(i) whether the work will convert any
Improvement that is, prior to such alterations, a complete, self-contained
operating unit into a structure that is not a complete, self-contained operating
unit or impair the structural integrity of any Improvement;
(ii) whether the work will decrease the value of
any location which is part of the Leased Premises below the value of the same as
of the date of commencement of such alterations or materially decrease the size
of the rentable space contained therein;
(iii) whether the work will convert the use of any
location which is part of the Leased Premises from the use thereof as of the
date of this Lease, unless (x) prior to making any such alterations, Landlord
shall notify Tenant that Tenant shall be obligated to restore the Leased
Premises to the use thereof existing as of the date of this Lease at the sole
cost and expense of Tenant, on or before the last day of the Term, or the sooner
expiration or termination thereof, and Tenant shall agree in writing to so
restore and (y) such alterations shall be of such a nature as to reasonably
permit such restoration to be made without excessive cost or expense, or
(iv) whether the work will constitute the
demolition of all or a substantial portion of the structure of any Improvement.
35.2 No alterations shall be commenced until Tenant shall have
submitted to Landlord for approval by Landlord, plans and specifications for the
proposed work in sufficient detail to permit Landlord to evaluate the impact of
the work on the Leased Premises and Tenant shall have procured all necessary
permits and authorizations of all public authorities having jurisdiction. All
alterations shall be made promptly, in good and workmanlike manner, and so as
not to permit Landlord's fee title to the Leased Premises to be subjected to a
mechanics or other lien, and in compliance with all applicable permits,
authorizations, laws, ordinances, regulations and requirements of all public
authorities having jurisdiction and in accordance with the orders, rules and
regulations of the applicable Board of Fire Underwriters having jurisdiction
over the Leased Premises, the Insurance Services Office and any other body
exercising similar functions to either of the foregoing.
35.3 Prior to commencing any construction, alterations, or
additions to the Leased Premises or the Improvements estimated to cost in excess
of Two Hundred Fifty Thousand ($250,000.00) Dollars, increased every five years
by the corresponding increase in the CPI, Tenant shall, if Landlord so elects,
deliver to Landlord, at Tenant's expense, payment and performance bonds, which
bonds shall be issued by a company or companies, and in form and content,
reasonably satisfactory to Landlord and in an amount not less than the estimated
cost of such construction, alterations, or additions.
35.4 Any and all alterations, additions and improvements made with
respect to, or placed upon, the Leased Premises or the Improvements by Tenant,
as well as all fixtures and articles of personal property attached to, or used
in connection with, the Leased Premises or the
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improvements, shall become, be and remain the property of Tenant for the Term of
this Lease. but shall become the property of, and surrendered to, Landlord at
the end or other termination of this Lease, provided, however, that the
furniture and other movable personal property and movable trade fixtures put in
at the expense of Tenant or any subtenant that, pursuant to the provisions of
Article 33 hereof may be or shall be removed by Tenant, or by any subtenant upon
Landlord's demand, at or before the expiration or sooner termination of this
Lease, shall not be deemed to be attached to the freehold nor the property of,
nor surrendered to, Landlord.
ARTICLE 36
TENANT AND LANDLORD TO FURNISH STATEMENTS
36.1 Each party shall, within twenty (20) days after the actual
receipt of a written request of the other partly or of any holder or potential
holder of a fee mortgage or leasehold mortgage on the Leased Premises or any
portion thereof, furnish a written statement, duly acknowledged, of the
following items:
(a) the amount of Fixed Net Rent and additional rent due,
if any;
(b) whether this Lease is unmodified and in full force
and effect (or, if there have been modifications, whether this Lease is in full
force and effect as modified and stating the modifications).
(c) whether. to the best knowledge and belief of the
requested party, the requesting party is in default;
(d) whether Tenant has given Landlord or Landlord has
given Tenant any notice of default under this Lease, and if given, whether the
default set forth therein remains uncured; and
(e) such other items as may be reasonably requested by
the requesting party.
Any such statement shall be for the sole benefit of Landlord or its assigns, or
such holder or prospective holder requesting the same or its assigns, and shall
have no effect, as an estoppel or otherwise, with respect to any third party.
36.2 Upon the failure of Tenant to furnish any such statement
within the said twenty (20) day period, it shall be conclusively presumed that
this Lease is in full force and effect and that there are no defaults by
Landlord hereunder.
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ARTICLE 37
INSPECTIONS BY LANDLORD
37.1 Upon reasonable prior notice from Landlord (except in an
emergency, in which event no notice shall be necessary), and with Landlord
undertaking reasonable efforts not to cause an unreasonable interference with
Tenant's use, Tenant shall permit an inspection of the Leased Premises and the
Improvements by Landlord, by Landlord's agents or representatives, and by, or on
behalf of, prospective purchasers and/or mortgagees of the fee interest in the
Leased Premises at any time and from time to time during the Term. During the
three (3) year period next preceding the Expiration Date, Tenant shall permit
inspection thereof by or on behalf of prospective tenants. If admission to the
Leased Premises or any Improvement for the foregoing purposes cannot be
obtained, or if at any time by reason of an emergency condition an entry shall
be deemed necessary for the protection of the Leased Premises or the
Improvements, whether for the benefit of Tenant or not, Landlord, or Landlord's
agents or representatives, may enter the Leased Premises or the Improvements and
accomplish such purposes. The provisions contained in this Article 37 are not
intended to create or increase, and are not to be construed as creating or
increasing, any obligations on Landlord's part hereunder.
ARTICLE 38
SURRENDER AT THE END OF THE TERM
38.1 On the last day of the Term, or on the earlier termination of
the Term, Tenant shall peaceably and quietly leave, surrender and deliver the
Leased Premises and the Improvements to Landlord (together with any instrument
necessary to transfer title to or to confirm that Landlord shall succeed to such
title upon the expiration or sooner termination of the term, with respect to
alterations or improvements made by Tenant, with any transfer tax, recording
fees, or documentary stamp taxes or fees to be the sole cost and expense of
Tenant), together with any machinery, equipment, or other personal property of
any kind or nature that Tenant may have installed or affixed on, in, or to the
Leased Premises or the Improvements for use in connection with the operation and
maintenance of the Leased Premises and/or the Improvements for the purposes for
which they are intended (whether or not such property is deemed to be fixtures),
in good repair, order and condition (subject to the terms of Section 8.3
hereof), reasonable use, wear and tear and insured casualty excepted. If the
Leased Premises and the Improvements are not so surrendered, Tenant shall make
good to Landlord all expenses that Landlord shall incur by reason thereof, and,
in addition, Tenant shall indemnify Landlord from and against all claims made by
any succeeding lessee against Landlord, founded upon delay by Landlord in
delivering possession of the Leased Premises and the Improvements to such
succeeding lessee, so far as such delay is occasioned by the failure of Tenant
to surrender the Leased Premises and the Improvements.
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ARTICLE 39
COVENANTS BINDING ON SUCCESSORS AND ASSIGNS
39.1 The covenants, agreements, terms, provisions and conditions
contained in this Lease shall apply to, inure to the benefit of and be binding
upon Landlord, Tenant and their respective successors and assigns, except as
expressly otherwise hereinbefore provided, but shall not inure to any third
party beneficiaries.
ARTICLE 40
ENTIRE AGREEMENT
40.1 This Lease contains the entire agreement between the parties,
and shall not be modified in any manner except by an instrument in writing
executed by the parties or their respective successors in interest.
ARTICLE 41
MISCELLANEOUS
41.1 Except as otherwise herein specifically provided to the
contrary, where the consent or approval of either party hereto shall be
required, the parties hereto agree that such consent shall not be unreasonably
withheld or delayed.
41.2 The captions of this Lease and the index preceding this Lease
are for convenience and reference only and in no way define, limit or describe
the scope or intent of this Lease, nor in any way affect this Lease.
41.3 All the provisions of this Lease shall be deemed and construed
to be "CONDITIONS" as well as "COVENANTS", as though the words specifically
expressing or importing covenants and conditions were used in each separate
provision hereof.
41.4 Words of any gender in this Lease shall be held to include any
other gender and words in the singular number shall be held to include the
plural when the sense requires.
41.5 If and to the extent that a provision of this Lease shall be
unlawful or contrary to public policy, the same shall not be deemed to
invalidate the other provisions of this Lease.
41.6 This Lease shall be governed by, and construed and interpreted
in accordance with the laws of the State where the Leased Premises are located,
applicable to agreements made and to be performed entirely therein.
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41.7 Landlord represents to Tenant that Landlord has the right to
enter into this Lease with Tenant.
ARTICLE 42
CERTAIN DEFINITIONS
42.1 As the same are used in this Lease, the following terms shall
have the following meanings:
(a) "COMMENCEMENT DATE" shall have the meaning set forth
in Section 2.1;
(b) "DEPOSITORY" shall mean a bank or trust company
having offices in the City, County and State of New York or the City of Atlanta,
Fulton County and State of Georgia and a net worth of not less than Twenty-Five
Million ($25,000,000.00) Dollars, to be selected by Tenant, subject to the
written approval of Landlord, to act as insurance trustee;
(c) "EVENT OF DEFAULT" shall have the meaning set forth
in Section 16.1;
(d) "EXPIRATION DATE" shall mean the ending, termination,
or expiration date of the Term of this Lease,
(e) "FIXED NET RENT" shall have the meaning set forth in
Section 2.1,
(f) "IMPROVEMENTS" shall mean the structures or
buildings, and replacements thereof, now on the Leased Premises or hereafter
erected on the Leased Premises, including all building equipment, apparatus,
machinery and fixtures of every kind and nature forming part of such structures
or buildings, or of any structures or buildings hereafter standing on the Leased
Premises or on any part thereof and articles of personal property owned by the
Tenant now or at any time hereafter affixed to, attached to, placed upon, or
used in any way in connection with the complete and comfortable use, enjoyment,
occupancy or operation of, any such structures or buildings (provided, however,
that nothing in the foregoing definition shall be construed to be in limitation
of Tenant's rights and obligations pursuant to the terms of Section 33.1 to
remove certain personal property and trade fixtures (including hydraulic lifts)
from the Leased Premises on or before the Expiration Date);
(g) "LANDLORD" shall mean the then holder of the fee
title to the Leased Premises at the time in question;
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(h) "LEASED PREMISES" shall have the meaning set forth in
the Statement of Facts to this Lease; and
(i) "NOTICE" shall have the meaning set forth in Section
29.1.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement of Lease as of the day and year first above written.
TENANT: LANDLORD:
FRANKLIN FORD MERCURY, INC. KIMCO AUTOFUND, LP
By: /s/ Charles K. Yancey By: KIMCO AUTOVENTURE, INC.
---------------------------- General Partner
Name: Charles K. Yancey
-----------------------
Title: CEO
----------------------
Attest: /s/ Stephen C. Whicker By: /s/ Michael V. Pappagallo
------------------------ --------------------------------
Name: Stephen C. Whicker Name: Michael V. Pappagallo
----------------------- ------------------------------
Title: Secretary Title: Vice President
---------------------- -----------------------------
Attest: /s/ Michael E. Pam
----------------------------
Name: Michael E. Pam
------------------------------
Title: Assistant Secretary
-----------------------------
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