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EXHIBIT 10(2.2)
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EXHIBIT 10(2.2)
SECOND MODIFICATION AND RATIFICATION
OF LEASE AGREEMENT
This Modification and Ratification of Lease Agreement is made and
entered into as of April 28, 1997, between Parkway Partners, L.L.C., a Missouri
Limited Liability Company ("Landlord") and Layne Christensen Company ("Tenant")
for and in consideration of Ten Dollars ($10.00) and other good and valuable
consideration, receipt of which is hereby acknowledged.
WITNESSETH:
Landlord and Tenant hereby confirm and ratify, except as modified
below, all of the terms, conditions and covenants in that certain written
Commercial Building Lease dated December 21, 1994, as modified by the First
Modification and Ratification of Lease dated February 26, 1996, by and between
Landlord and Tenant. Further:
1. LEASED PREMISES. The Leased Premises shall be increased to include
additional space, measuring an additional 2,374 rentable square feet ("Second
Expansion Space") on the Garden Level Leased Premises as set forth in Exhibit
"A", attached hereto and incorporated herein by reference.
2. TERM.
a. COMMENCEMENT DATE. The term for the Second Expansion Space
shall begin (hereafter, the "Commencement Date") upon
substantial completion (as defined in subsection b) below) of
the Second Expansion Space. If the Commencement Date would be
a Saturday, Sunday, or holiday, the Commencement Date shall be
the first business day following that Saturday, Sunday, or
holiday.
The Lease term shall end five (5) years from the Commencement
Date, unless terminated earlier pursuant to the terms and
conditions hereof. Within thirty (30) days after the
Commencement Date the parties shall confirm in writing the
calendar date of the Commencement Date.
b. SUBSTANTIAL COMPLETION. Landlord shall use its best efforts to
substantially complete the Second Expansion Space by no later
than forty-eight (48) days following the Plan Selection Date
(defined in Section 6 hereof) (the "Target Date").
Substantially complete means:
(i) completing the Leasehold Improvements referred to in
section 6 hereof so that (a) Tenant can use the
Second Expansion Space for its intended purpose
without material interference and (b) the only
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incomplete items are minor or insubstantial details
of construction, mechanical adjustments, or finishing
touches such as touch-up plastering or painting;
(ii) securing an appropriate certificate of occupancy, if
any, from the local municipality or other
governmental agency;
(iii) Tenant, its employees, agents, and invitees, have
ready access to the Second Expansion Space;
(iv) the decoration, fixtures, and equipment to be
installed by Landlord are installed and in good
operating order;
(v) the Second Expansion Space is ready for the
installation of any equipment, furniture, fixtures,
or decoration that Tenant will install;
(vi) the following items are installed and in good
operating order: (a) walls, flooring, ceiling,
lighting, etc., (b) heating, ventilating and
air-conditioning, utilities, and plumbing services
serving the leased premises, and (c) the doors and
hardware; and
(vii) the Second Expansion Space is broom clean.
c. NOTICE. Landlord shall give Tenant at least fifteen (15) days
advance notice of the estimated substantial completion date if
different from the Target Date.
d. INSPECTION AND PUNCHLIST. Before the Commencement Date, the
parties shall inspect the Second Expansion Space, have all
systems demonstrated, and prepare a punchlist. The punchlist
shall list incomplete, minor, or insubstantial details of
construction; necessary mechanical adjustments; and needed
finishing touches. Landlord will complete the punchlist items
within fifteen (15) days after the Commencement Date. Landlord
will promptly correct any latent defects as they become known,
if Tenant notifies Landlord of the defect within thirty (30)
days after Tenant first learns of the defect.
e. DELAYED POSSESSION. Tenant may cancel this Lease if Landlord
cannot deliver actual possession of the substantially complete
leased premises by thirty (30) days after the Target Date.
3. BASE RENT. The Base Rent for the Second Expansion Space shall
be as follows:
Years 1 - 2 $26,114.00 Annually; $2,176.17 Monthly
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Years 3 - 5 $28,488.00 Annually; $2,374.00 Monthly
Rent shall be prorated for any fractional month.
4. PRO-RATA SHARE OF OPERATING EXPENSE. Tenant's Pro-Rata Share of
Operating Expenses, as referenced on Page 2 of the Commercial Building Lease,
shall increase to 71.13%.
5. LEASEHOLD IMPROVEMENT ALLOWANCE. Upon the full execution of this
Second Modification and Ratification of Lease, Landlord shall make available a
leasehold improvement allowance ("Leasehold Improvement Allowance") in the
amount of Twenty Four Thousand and No/l00 Dollars ($24,000.00) to pay for costs
of the Leasehold Improvements, as referenced in Section 6 hereof. In the event
the actual costs of the Leasehold Improvements are less than $24,000, the
monthly rental for the Second Expansion Space shall be reduced by an amount
equal to the quotient obtained by dividing the difference between $24,000 and
such actual costs by 60.
6. APPROVAL OF LEASEHOLD IMPROVEMENT DESIGN. Within five (5) days of
the date hereof Landlord shall provide Tenant with a floor plan layout and
specifications regarding the construction of Tenant's improvements (the
"Leasehold Improvements") for the Second Expansion Space. Upon receipt of the
floor plan layout and specifications, the parties shall have ten (10) business
days to reach agreement in writing (with the date of such written agreement to
be referred to as the "Plan Selection Date") as to such plans and specifications
and the cost chargeable to Tenant (the "Estimated Improvement Costs") for the
Leasehold Improvements. Absent such written agreement among the parties within
such time frame, either party hereto may terminate this Agreement and neither
party shall have any liability to the other hereunder. If the Estimated
Improvement Costs exceed $24,000, the monthly rental for the Second Expansion
Space shall be increased by an amount equal to the quotient obtained by dividing
the difference between $24,000 and the Estimated Improvement Costs by 60, plus
interest at the rate of 8% per annum on the unamortized balance of such
difference; provided, however, if the actual costs of the Leasehold Improvements
are less than the Estimated Improvement Costs, but more than $24,000, the
monthly rental for the Second Expansion Space shall increase by an amount equal
to the quotient obtained by dividing the difference between $24,000 and such
actual costs by 60, plus interest at the rate of 8% per annum on the unamortized
balance of such difference. With respect to actual Leasehold Improvement Costs
in excess of $24,000, Tenant may, at its option, either pay such costs in cash
as of the Commencement Date, or finance such costs as provided above. In any
case, if the actual costs of the Leasehold Improvements exceed the Estimated
Improvement Costs, Landlord shall be responsible for such excess costs, except
to the extent such excess costs are attributable to changes in the plans and
specifications requested by Tenant in writing. Upon Tenant's approval in writing
of the floor plan layout and specifications, Landlord shall commence
construction of the Leasehold Improvements and deliver the same to Tenant as
provided in Section two hereof.
7. BUY-OUT OPTION. Tenant shall have an option (the "Buy-Out Option")
to terminate this Second Modification and Ratification of Lease Agreement upon
payment to
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Landlord of the unamortized portion (the "Buy-Out Option Amount") of the actual
Leasehold Improvement costs including related architectural fees and design
fees. Landlord and Tenant hereby agree that the Buy-Out Option is granted to
Tenant effective February 28, 2000. In the event Tenant elects to exercise this
Buy-Out Option, Tenant must provide written notice of same no later than
December 31, 1999. Based on the $24,000.00 Leasehold Improvement Allowance and a
Commencement Date of June 1, 1997, the parties agree that the Buy-Out Option
Amount as of February 28, 2000, is $12,238.70. In the event the actual costs of
the Leasehold Improvements differ from $24,000 and the Commencement Date is
other than June 1, 1997, the Buy-Out Option Amount shall be increased or
decreased, as the case may be, in accordance with such difference. The parties
hereto shall confirm in writing the actual Buy-Out Option Amount within thirty
(30) days following the Commencement Date.
8. SIGNAGE. Upon the execution of this Agreement, Landlord shall remove
all exterior signage relating to the leasing of Second Expansion Space.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
LANDLORD:
PARKWAY PARTNERS, L.L.C.
Dated: April 28, 1997 By: /s/ Melanie Mann
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Melanie Mann, Vice President
TENANT:
LAYNE CHRISTENSEN COMPANY
Dated: April 28, 1997 By: /s/ Jerry W. Fanska
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Jerry W. Fanska, VP Finance & Treasurer
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Exhibit "A"
Floor Plan of Leased Premises
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