Exhibit 10.22
STATE OF GEORGIA
Lithonia, Georgia
COUNTY OF DEKALB
LEASE AGREEMENT
THIS LEASE (this "Lease") made this the 13th day of May, 1996, by and
between SWS-GA REALTY, INC., a Georgia corporation, and STANWOOD INTERESTS
LIMITED PARTNERSHIP, a Texas limited partnership, collectively first party,
hereinafter referred to as "Lessor," and HUGHES SUPPLY, INC., a Florida
corporation, second party, hereinafter referred to as "Lessee."
W I T N E S S E T H:
1. Premises. Lessor, for and in consideration of the rents, covenants,
agreements, and stipulations hereinafter mentioned, reserved and contained, to
be paid, kept and performed by Lessee, has leased and rented, and by these
presents does lease and rent, unto said Lessee, and said Lessee hereby agrees to
lease and take upon the terms and conditions which hereinafter appear, the
following described property (hereinafter called "Premises") and personal
property as hereinafter set forth.
The Premises consists of real property and improvements located at 2331
Varkel Way, Lithonia, Georgia 30058, including, without limitation, the
approximately 2.566 acres of real property and a one-story metal building and
other improvements thereon described in the survey made Exhibit A to this Lease.
2. Warranties. Lessor warrants that Lessor owns the premises in fee simple and
has the right to enter into this Lease; that the Premises are free from liens
and encumbrances except for utility easements and unviolated restrictive
covenants which do not materially adversely affect Lessee's intended use of the
Premises; that the Premises abuts one or more publicly dedicated roads; that the
Premises do not, as of the date of this Lease, and will not, by reason of the
commencement of the term of this Lease, fail to conform to all applicable
building ordinances, laws and regulations in any respect which will materially
adversely interfere with Lessee's use of the Premises for its intended purposes;
that Lessee's proposed use of the Premises is consistent with the zoning
classification applicable to the Premises; that Lessor's past and current uses
of the Premises comply with federal, state and local environmental laws and
regulations; that Lessor has not received a citation from any regulatory agency
for noncompliance with environmental laws; that Lessor has no knowledge of the
presence of fuel storage tanks or of hazardous, toxic, dangerous, or
carcinogenic materials, substances or contaminants, formaldehyde,
polychlorinated biphenyls ("PCBs"), lead, lead dust, asbestos, asbestos
containing materials ("ACMs"), oil, gasoline, other petroleum products or
byproducts, radon or other similar materials or substances (collectively
"Hazardous Materials") on, in or under the Premises and has no knowledge of any
contamination present on, in or under the Premises; and covenants that Lessee,
provided it
performs all of its obligations under this Lease, will peaceably and quietly
enjoy the Premises during the Lease term without any disturbance from Lessor,
anyone claiming by, through or under Lessor, or any other party, except as
otherwise specifically provided in this Lease. The foregoing covenant of quiet
enjoyment includes the right of Lessee to use the property as it is currently
used, including, but not limited to, outside storage. The parties each
acknowledge that by acceptance of the Premises, Lessee does not waive its rights
pursuant to the covenant of quiet enjoyment hereunder.
3. Term. The initial term of this Lease shall be for three (3) years, said term
to begin on the 13th day of May, 1996 (the "Commencement Date") and end on the
12th day of May, 1999 (the "Initial Term"). The Initial Term of this Lease may
be extended, at the option of the Lessee, for up to two (2) successive periods
of three (3) years (each such period of three (3) years herein sometimes
referred to as an "Extended Term") as follows:
First Extended Term - May 13, 1999 to May 12, 2002.
Second Extended Term - May 13, 2002 to May 12, 2005.
The option to extend shall be exercised by the Lessee by giving notice to
the Lessor not more than twelve (12) nor less than six (6) months prior to the
expiration of the then existing term. Each Extended Term shall be upon the same
terms, covenants, and conditions as provided in the Lease. Any termination of
this Lease during the Initial Term or any Extended Term shall terminate all
rights of any further extension hereunder. The use of the word "Term" herein
shall be deemed to include the Initial Term as well as any Extended Term.
4. Rental. As rent for the Premises, Lessee shall pay to Lessor in advance on
the first day of each calendar month of the Term the sum of $5,250.00 per month,
being at the rate of $63,00.00 per annum; provided, however, on each anniversary
of the Commencement Date during the Term, the annual rent shall be increased
over the rent for the prior lease year by an amount equal to the percentage
increase in the CPI from the first month of the previous lease year to such
anniversary date. Such adjustment, however, shall not result in any instance in
a reduction of the annual rent, nor shall any annual rent adjustment result in
an increase in the annual rent by an amount in excess of 3% of the previous
year's rent.
For purposes of this Lease, "CPI" refers to the Consumer Price Index for
All Urban Consumers (CPI-U), All Items, U.S. City Average (1982-1984 equals
100), published by the United States Department of Labor, Bureau of Labor
Statistics. If the CPI is discontinued, such other index as published by the
Department of Labor, Bureau of Labor statistics, or its successor agency, in
substitution therefor or replacement thereof shall be used for making said
computations. If the Department of Labor or its successor agency shall no longer
maintain such statistics, comparable statistics published by a responsible
financial periodical or recognized authority selected by the Lessor and Lessee
shall be used for making said Computations. If the base years "(1982-1984 equals
100)" or other base year used in computing the Index is changed, the figures
used in making said adjustment shall be changed
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accordingly so that all increases in the CPI, or any substituted or replacement
index, as the case may be, are taken into account notwithstanding any such
change in the base year.
5. Utility Bills, Lessee shall pay all utility bills of all types, including,
but not limited to, water and sewer, natural gas, electricity and sanitary pick
up bills for the Premises, or used by Lessee in connection therewith. If Lessee
does not pay same, Lessor may pay the same, and such payment shall be added to
the rental of the Premises.
6. Ad Valorem Taxes. Lessee shall pay all real property taxes, special and
general assessments, water and sewer assessments and other rents, rates, and
changes and other guaranteed impositions of every kind and nature extraordinary
as well as ordinary relating to the premises or any business conduct thereon.
Lessee shall also pay any and all ad valorem taxes assessed against the personal
property located on the Premises during the Term.
7. Insurance. Lessee will carry, at Lessee's sole cost and expense, "All Risk"
Insurance Coverage on the Premises in an amount not less than the full insurable
value. The term "full insurable value" shall mean the actual replacement cost,
excluding foundation and excavation costs, as determined by Lessor. Such
policies shall name Lessor as an additional named insured.
All insurance provided for in this Lease shall be effected under
enforceable policies issued by insurers of recognized responsibility licensed to
do business in this state. At least fifteen (15) days prior to the expiration
date of any policy, the original renewal policy for such insurance shall be
delivered by Lessee to Lessor. With fifteen (15) days after the premium on any
policy shall become due and payable, Lessor shall be furnished with satisfactory
evidence of its payment.
If Lessee provides any insurance required by this Lease in the form of a
blanket policy, Lessee shall furnish satisfactory proof that such blanket policy
complies in all respects with the provisions of this Lease and that the coverage
thereunder is at least equal to the coverage which would be provided under a
separate policy covering only the Premises.
If Lessor so requires, the policies of insurance provided for shall be
payable to the holder of any mortgage, as the interest of such holder may
appear, pursuant to a standard mortgagee clause. All such policies shall, to the
extent obtainable, provide that any loss shall be payable to Lessor or to the
holder of any mortgage notwithstanding any act or negligence of Lessee which
might otherwise result in forfeiture of such insurance. All such policies shall,
to the extent obtainable, contain an agreement by the insurers that such
policies shall not be cancelled without at least thirty (30) days prior written
notice to Lessor and to the holder of any mortgage to whom loss hereunder may be
payable.
Lessee will carry at Lessee's own expense insurance coverage on ail
equipment, fixtures and appliances.
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8. Maintenance and Repairs by Lessee. Lessor warrants as of the Commencement
Date of this Lease that the Premises are structurally sound and that all
lighting and all operating systems are in good condition and are not in need of
repair. Except as set forth in Paragraph 9, Lessee shall, at it's own expense,
keep and maintain the interior of the Premises, including all systems pertaining
to water, sewer, electrical, heating, ventilation, air conditioning and
lighting. Lessee shall also perform exterior lawn maintenance. It is the intent
of the parties that Lessee shall only be required to make minor repairs not
repairs or replacements which are structural in nature, extra ordinary or
capital in nature, or those which will increase the value of the Premises
subsequent to the end of the Term. In addition, the Lessee shall not be required
to repair latent defects in the Premises.
9. Repairs by Lessor. Lessor agrees to maintain and keep in good repair the
roof, exterior walls, structural supports (including foundations), exterior
doors of any and all buildings located on the Premises, and all water or sewer
pipes located underground or in the slab, sidewalks, parking lots, driveways and
other vehicular access and maneuvering areas. Lessor shall also be responsible
for any repairs or replacements which are structural in nature, which are
extraordinary or capital in nature, which will increase the value of the
Premises subsequent to the end of the Term and any other repairs not expressly
delegated to Lessee in this Lease. Lessor shall also promptly clean up and
dispose of any Hazardous Materials found on, in or under any portion of the
Premises and remediate the Premises to comply with any and all environmental
laws applicable thereto, and to pay for all clean-up and disposal costs at no
cost to Lessee, unless directly caused by Lessee, its employees, agents or
contractors.
10. Destruction of or Damage to the Premises. If the Premises are totally
destroyed by storm, fire, lightning, earthquake or other casualty, this Lease
shall terminate as of the date of such destruction, and rental shall be
accounted for as between Lessor and Lessee as of that date. If the Premises are
damaged, but not wholly destroyed by any of such casualties, rental shall abate
in such proportion as use of the Premises has been destroyed, and Lessor shall
restore the Premises to substantially the same condition as before the damage as
speedily as practicable, whereupon full rental shall recommence; provided
further, however, that if the damage shall be so extensive the same cannot be
reasonably repaired and restored within three (3) months time from the date of
the casualty, then either Lessor or Lessee may cancel this Lease by giving
written notice to the other party within thirty (30) days from the date of such
casualty. And, in such event, rental shall be apportioned and paid up to the
date of such casualty.
11. Modifications and Alterations to the Premises. No modifications,
alterations, or improvements to the building or openings cut through the roof
are allowed without the prior written consent of Lessor, which consent shall not
be unreasonably withheld or delayed.
12. Removal of Fixtures. Lessee may (if not in default hereunder) prior to the
expiration of this Lease, or any extension thereof, remove all personal
property, fixtures and equipment which Lessee has placed in the Premises,
provided Lessee repairs all damages to the Premises caused by such removal.
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13. Return of the Premises. Lessee agrees to return the Premises to Lessor at
the expiration, or prior termination, of this Lease in good condition and
repair, reasonable wear and tear, damage by storm, fire, lightning, earthquake
or other casualty alone excepted.
14. Condemnation. If the whole of the leased Premises, or such portion thereof
as will make the Premises unusable for the purpose herein leased, be condemned
by any legally constituted authority for any public use or purpose or if Lessor
sells the Premises under threat of condemnation, then in either of said events,
the Term shall cease from the time when possession thereof is taken by public
authorities, and rental shall be accounted for as between Lessor and Lessee as
of that date. Such termination, however, shall be without prejudice to the
rights of either Lessor or Lessee to recover compensation and damage caused by
condemnation from the condemnor. It is further understood and agreed that
neither Lessee, nor Lessor, shall have any rights in any award made to the other
by any condemnation authority.
If there is a partial taking and if it is not so extensive as to render
the remaining portion (after restorations) unsuitable for the business of
Lessee, then this Lease shall continue in effect and Lessor, upon receipt of the
award in condemnation, will expeditiously commence and complete all necessary
repairs and restorations to the building on the Premises so as to constitute the
portion of the building not taken a complete architectural unit and restore it
as nearly as practicable to its prior condition; provided, however, that such
work does not exceed the scope of the original construction of the building, and
Lessor will not be under any duty to expend amounts in excess of the award
received by Lessor. Rent, taxes and other charges payable by Lessee will
equitably abate while Lessor's repairs and restorations are in process. If a
partial taking consists only of a street widening or utility easement which does
not materially affect Lessee's use of the Premises, this Lease will continue in
full force and effect without abatement of rent, taxes or other charges.
15. Governmental Orders. Lessee agrees, at its own expense and solely in
relation to those portions of the Premises which Lessee is required to maintain
or repair under Paragraph 8, to promptly comply with all requirements of any
legally constituted public authority made necessary by reason of Lessee's
specific use of said Premises. Notwithstanding the foregoing, the Lessee shall
not be liable for: (a) repairs, alterations, replacements or retrofitting
required by the accessibility or path of travel requirements set forth in Title
III of the Americans With Disabilities Act of 1990, 42 USC ss. 2101, et seq. and
regulations and guidelines promulgated thereunder, as amended from time to time
(collectively referred to as "ADA"); (b) removal or abatement of ACMs; (c)
repairs, alterations or replacements required to comply with federal, state or
local indoor air quality laws, rules or regulations; (d) repairs or replacements
incident to CFC conversions for heating and cooling systems; (e) installation of
fire sprinkler systems; or (f) repairs, alterations or replacements described in
Paragraph 9. Lessor agrees to promptly comply with any other governmental or
regulatory requirements if not made necessary by reason of Lessee's occupancy of
the Premises or relating to those portions of the Premises which Lessor is
required to maintain or repair under Paragraph 9.
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16. Assignment. Except as set forth below, Lessee may not assign this Lease, or
any interest thereunder, or sublet the Premises in whole or in part without
prior written notice to Lessor of its intent to assign or sublease. Lessee may
(a) sublet all or part of the Premises to any corporation, the majority of whose
shares are owned by Lessee, during the period of such majority ownership only or
(b) assign this Lease to any corporation which owns more than fifty percent
(50%) of Lessee's issued and outstanding shares, or which succeeds to the entire
business of Lessee through purchase, merger, consolidation or reorganization, or
to any affiliate sharing common majority ownership with the Lessee. Subtenants
or assignees shall become liable directly to Lessor for all obligations of
Lessee hereunder, without relieving Lessee's liability.
17. Mortegee's Rights. Lessee's rights shall be subject to any bona fide
mortgage or deed to secure debt which is now, or may hereafter be, placed upon
the Premises by Lessor, and Lessee agrees, at Lessor's cost, to execute and
deliver such documentation as may be reasonably required by any such mortgagee
to effect any subordination. Provided, however, as a condition to such
subordination, Lessor must secure from each mortgagee a nondisturbance agreement
acceptable to Lessee providing that in the event of a foreclosure the mortgagee
will recognize the validity of this Lease and, provided that Lessee is not in
default, will not disturb Lessee's possession or its rights under this Lease.
18. Use of the Premises. The Lessee may use the Premises for office/warehouse
and distribution purposes, including outdoor storage, or for any other lawful
purpose. The Premises shall not be used for any illegal purposes, nor in any
manner to create any nuisance or trespass; nor in any manner to vitiate the
insurance, based on the above purposes for which the Premises are leased.
19. Signs. Lessee shall have the right to erect at Lessee's sole expense a sign
at the entrance to the Premises. This sign shall not be other than a customary
trade sign identifying the business of Lessee. The erection of this sign by
Lessee shall be subject to and in conformity with all applicable laws, zoning
ordinances and building restrictions or covenants of record. On or before
termination of this Lease, Lessee shall remove the sign thus erected, and shall
repair any damage or disfigurement, caused by such removal.
20. Reservation of Right to Sell. Lessor shall have the right to sell the
Premises during the term of this Lease, subject to the following:
a. Lessor agrees to give notice of each proposed sale, including the
purchase price and all other terms and conditions, to Lessee;
b. Lessee will have the right to purchase the Premises at the purchase
price and on the other terms and conditions offered by Lessor or offered to
Lessor by the third party (which offer Lessor wishes to accept), by giving
notice to Lessor within 20 business days after Lessor has notified Lessee of the
terms of Lessor's proposed sale; and
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c. If Lessee does not give notice of the exercise of its option within
such time, Lessor will have the right to sell the Premises upon the terms stated
in the offer made or received by Lessor, but not upon terms more favorable to
the purchaser, unless Lessor again gives notice pursuant to subparagraph a,
above, and Lessee does not exercise its option based upon the new terms.
21. Entry for Carding, etc. Lessor may card the Premises "For Rent" or "For
Sale" ninety (90) days before the termination of this Lease. Lessor may enter
the Premises at reasonable hours during the term of this Lease to exhibit the
same to prospective purchasers and to make repairs required of Lessor under the
terms hereof.
22. Indemnity. Lessor agrees to indemnify and save harmless Lessee and its
parents, subsidiaries, affiliates, directors, officers, employees, agents,
servants, attorneys and representatives from any and all claims, causes of
action, damages, fines, judgments, penalties, costs (including environmental
clean-up costs and response costs), liabilities, expenses or losses (including
without limitation, reasonable attorneys' fees and expenses of litigation)
arising during or after the Term: (a) as a result of any violation by Lessor of
any applicable federal, state or local environmental laws or regulations, as now
or hereinafter in effect, regulating, relating to or imposing liability or
imposing standards of conduct concerning any Hazardous Materials ("Environmental
Laws") relating to the Premises; or (b) as a result of the presence,
disturbance, discharge, release, removal or cleanup of Hazardous Materials as a
result of environmental contamination or other similar conditions which occurred
or first arose prior to commencement of the Term and during the period of
Lessor's ownership of the Premises; or (c) as a result of any violation of the
accessibility or path of travel requirements imposed by ADA; or (d) as a result
of any of Lessor's representations and warranties being untrue. These
indemnities shall survive the expiration, cancellation or termination of the
Lease.
Lessee agrees to indemnify and save harmless Lessor and its stockholders,
affiliates, directors, officers, employees, agents, servants, attorneys and
representatives from any and all claims, causes of action, damages, fines,
judgments, penalties, costs (including environmental clean-up costs and response
costs), liabilities, expenses or losses (including without limitation,
reasonable attorneys' fees and expenses of litigation) arising during or after
the Term: (a) as a result of Lessee's use and occupancy of the Premises,
including, without limitation, any violation by Lessee of any Environmental Laws
relating to the Premises; or (b) as a result of the presence, disturbance,
discharge, release, removal or cleanup of Hazardous Materials as a result of
environmental contamination or other similar condition which occurred or first
arose after the commencement of the Term. These indemnities shall survive for a
period of three (3) years following the expiration, cancellation or termination
of this Lease.
23. Cancellation of Lease by Lessor. It is mutually agreed that in the event:
a. The rent herein reserved is not paid at the time and place when and
where due and Lessee fails to pay said rent within five (5) days after written
demand from Lessor; or
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b. Lessee shall fail to comply with any material term, provision,
condition, or covenant of this Lease, other than the payment of rent, and shall
not cure such failure within thirty (30) days after notice to Lessee of such
failure to comply or such additional time period as may reasonably necessary to
effect a cure of the default provided that Lessee commences and diligently
pursues a cure of the default; or
c. Lessee causes any lien to be placed against the Premises and does not
cure the same within thirty (30) days after notice from Lessor to Lessee
demanding cure; in any of such events, Lessor shall have the option to do any of
the following, in addition to, and not in limitation of any other remedy
permitted by law or by this Lease:
i. Lessor may terminate this Lease, in which event Lessee shall
immediately surrender the Premises to Lessor. Lessee agrees to indemnify Lessor
for all loss and damage which Lessor may suffer by reason of such termination,
whether through inability to relet the Premises, or through decrease in rent, or
otherwise; or
ii. Lessor, as Lessee's agent, without terminating this Lease, may
terminate Lessee's right of possession, and, at Lessor's option, enter upon and
rent the Premises at the best price obtainable by reasonable effort, without
advertisement and by private negotiations and for any term Lessor deems proper.
Lessee shall be liable to Lessor for the deficiency, if any, between Lessee's
rent hereunder and the price obtained by Lessor on reletting.
Pursuit of any of the foregoing remedies shall not preclude pursuit
of any of the other remedies herein provided or any other remedies provided by
law. In any case, Lessor shall use best efforts to mitigate Lessee's damages.
Any notice in this provision may be given by Lessor or its attorney.
24. Effects of Termination of the Lease. No termination of this Lease prior to
the normal ending thereof, by lapse of time otherwise, shall affect Lessor's
right to collect rent for the period prior to the termination thereof.
25. Default of Lessor. Should Lessor fail to perform any of its obligations
hereunder, Lessor shall have a period of 30 days after its receipt of written
notice from Lessee of a failure of performance within which to commence a cure
of that failure. Failure of Lessor to commence that cure within the 30-day
period or to effect that cure within that 30-day period shall be an event of
default under this Lease and Lessee may, at its option, elect to:
a. Terminate this Lease upon 30 days written notice to Lessor;
b. Bring an action to require specific performance of Lessor's
obligations;
c. Provide Lessor with an additional period of time within which to effect
that cure;
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d. Commence such cure itself, and Lessee may either, at its option, offset
any expenses it incurs in effecting such cure against the rent and other
charges due and payable by Lessee hereunder, or require that Lessor
immediately reimburse Lessee for its expenses; provided, however, in the
event of an emergency, Lessee may immediately effect a cure of Lessor's
failure should Lessor fail to act immediately to do so, without the
requirement of any notice by Lessee to Lessor; and/or
e. Pursue any other remedies provided herein or provided by law.
26. Purchase Option. Lessee shall have the option to purchase the Premises at
Fair Market Value, payable in cash at closing, said option being exercisable by
Lessee at any time during the Term by written notice given by Lessee to Lessor.
If this option is exercised by Lessee, closing shall be held within sixty (60)
days of the notice of exercise at a time and place, and on a date, reasonably
satisfactory to Lessor and Lessee (the Term shall be extended, if necessary,
through and including the date of closing). Title to the Premises shall be
conveyed free of any liens or encumbrances, and subject only to current year's
ad valorem taxes, applicable building restrictions, easements for utilities
servicing the Premises, and such other conditions of title as may not, in
Lessee's sole discretion, adversely affect the use of the Premises by Lessee or
as may be approved by Lessee (the "Permitted Exceptions"). Immediately following
the date of exercise of this option, Lessor shall furnish Lessee with a
commitment for a standard owner's title insurance policy, ATLA Form B,
reflecting only Permitted Exceptions and standard printed exceptions (the
"Commitment"). Immediately following closing, Lessor shall furnish Lessee with
an owner's title insurance policy issued in conformity with the Commitment. The
cost of the title insurance Commitment and policy shall be borne by Lessor;
provided, however, that the cost of any special endorsements shall be borne by
Lessee; and, further provided, that if Lessee obtains a mortgage title insurance
policy at closing, the cost of the combined owner's and mortgagee's policies
shall be divided equally between Lessor and Lessee. Ad valorem taxes, rent due
under the Lease, utilities and any insurance or other prepaid items assumed by
the Lessee shall be prorated as of the date of closing. Title to the Premises
shall be conveyed by general warranty deed in form acceptable for recording,
subject only to the Permitted Exceptions. Lessor and Lessee shall each bear
their respective costs in connection with exercise of the option and the
closing, including attorney's fees. Lessee shall bear the cost of recording the
deed, the cost of any survey obtained by Lessee, and all costs related to any
financing obtained by Lessee. Except for any prepaid rent, Lessee is not
entitled to a credit for rental payments paid by the Lessee during the Term of
the Lease.
The Lessor and Lessee shall attempt to determine the Fair Market Value by
mutual agreement within fifteen (15) days after Lessee gives notice of its
exercise of the option. However, if the parties cannot reach agreement on the
Fair Market Value, the following provisions shall apply:
a. Lessor and Lessee shall each select a qualified real estate
appraiser within the next fifteen (15) days. Each appraiser must demonstrate to
the reasonable
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satisfaction of both Lessor and Lessee that he has significant experience in
appraising similar properties.
b. The Fair Market Value shall be determined by the appraisers
within thirty (30) days thereafter. Each of the appraisers shall be instructed
to prepare an appraisal of the Premises in accordance with the following
instructions: The method of valuing the property shall use any one or a
combination of appropriate appraisal methodologies (i.e., replacement cost,
comparable sales, and income); provided, however, that any valuation based upon
the income approach (i.e., the capitalization of net rental amounts abstracted
from comparable real estate leased for similar uses) shall exclude from
consideration this Lease and the rental provided for herein. The appraised value
is to be a single value, not a range of values and not a schedule of different
values based upon different methodologies or different assumptions. The value of
any alterations, additions or improvements to the Premises made by Lessee shall
be included in the determination of Fair Market Value.
If the appraised values determined by the two appraisers do not differ by more
than ten percent (l0%), the purchase price shall be the average of the two
values. If the difference is more than ten percent (l0%), and the two appraisers
cannot agree upon a value (in which event such agreed value shall be binding
upon Lessor and Lessee), the two appraisers shall select a third appraiser
within fifteen (15) days thereafter. The third appraiser shall be instructed to
select a value within the range of values established by the initial two (2)
appraisals, within twenty (20) days after his appointment, following the
instructions set forth above, and the Fair Market Value so selected by the third
appraiser shall be binding upon Lessor and Lessee as the purchase price for the
Premises.
27. Holding Over. If Lessee remains in possession of the Premises after
expiration of the term hereof, with Lessor's acquiescence and without any
express agreement of the parties, Lessee shall be a tenant-at-will at the rental
rate in effect at end of the Lease; and there shall be no renewal of this Lease
by operation of law.
28. Notices. Any notice given pursuant to this Lease shall be in writing and
sent by certified mail to:
a. Lessor: c/o SWS-GA Realty, Inc.
320 Park Place Tower
2001 Park Place North
Birmingham, Alabama 35203
or to such other address as Lessor may hereafter designate in writing to Lessee.
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b. Lessee: Hughes Supply, Inc.
20 North Orange Avenue
Suite 200
Orlando, Florida 32801
Attention: J. Stephen Zepf
or to such other address as Lessee may hereafter designate in writing to Lessor.
29. Memorandum of Lease and Option. This Lease shall not be recorded, but the
parties agree to execute a Memorandum of this Lease for recording purposes which
shall set forth the commencement date, the term of the Lease and all extensions,
a legal description of the location of the Premises and a description of
Lessee's rights under this Lease, including the purchase option provided for in
paragraph 26 of this Lease. If Lessee records the Memorandum of Lease and
Option, Lessee agrees to pay all related recording fees and taxes.
30. Attorneys' Fees. In any litigation between the parties regarding this Lease,
the losing party agrees to pay to the prevailing party its reasonable attorneys'
fees and expenses of litigation. For purposes of this Paragraph, a party is to
be considered the prevailing party if:
a. It initiated the litigation and obtains (by judgment oral agreement)
substantially the relief sought; or
b. It did not initiate the litigation and the other party does not obtain
(by judgment or agreement) substantially the relief sought.
31. Waiver of Rights. No failure of Lessor to exercise any power given Lessor
hereunder, or to insist upon strict compliance by Lessee with its obligations
hereunder, and no custom or practice of the parties at variance with the terms
hereof shall constitute a waiver of Lessor's right to demand exact compliance
with the terms hereof.
32. Rights Cumulative. All rights, powers and privileges conferred hereunder
upon the parties hereto shall be cumulative but not restrictive to those given
by law.
33. Time of Essence. Time is of the essence of this Agreement.
34. Definitions. "Lessor" as used in this Lease shall include first party, its
heirs, representatives, assigns, and successors in title to the Premises.
"Lessee" shall include second party, its assigns and successors, and if this
Lease shall be validly assigned, or sublet, shall include also Lessee's
assignees or sub-lessees, as to the Premises covered by such assignment or
sub-lease. "Lessor" and "Lessee" include male and female, singular and plural,
corporation, partnership or individual, as may fit the particular parties.
11
35. Miscellaneous. This Lease contains the entire agreement of the parties
hereto, and no representations, inducements, promises or agreements, oral or
otherwise, between the parties, not embodied herein, shall be of any force or
effect.
If any term, covenant or condition of this Lease or the application
thereof to any person, entity or circumstance shall; to any extent, be invalid
or unenforceable, the remainder of this Lease, or the application of such term,
covenant, or condition to persons, entities or circumstances other than those
which or to which sued may be held invalid or unenforceable, shall not be
affected thereby, and each term, covenant or condition of this Lease shall be
valid and enforceable to the fullest extent permitted by law.
IN WITNESS WHEREOF, the parties herein have executed this Lease on the day
and year first above written.
SWS-GA REALTY, INC.
By: /s/ James Davis
----------------------------
Its: Vice-President
--------------------------
STANWOOD INTERESTS LIMITED
PARTNERSHIP
By: Stanreal, LLC,
its General Partner
/s/ Michael L. Stanwood
----------------------------
Michael L. Stanwood
HUGHES SUPPLY, INC.
By: /s/ David H. Hughes
----------------------------
Its: Chairman
---------------------------
12
STATE OF ALABAMA )
COUNTY OF JEFFERSON )
I, the undersigned Notary Public in and for said County, in said State,
hereby certify that James D. Davis, whose name as Vice President of SWS-GA
REALTY, INC., a Georgia corporation, is signed to the foregoing instrument and
who is known to me, acknowledged before me on this day that, being informed of
the contents of said instrument, he as such officer and with full authority,
executed the same voluntarily for and as the act of said corporation on the day
the same bears date.
Given under my hand and official seal, this 13th day of May, 1996.
/s/ Robert A. Paine
--------------------------------
Notary Public Robert A. Paine
My Commission Expires:
2-2-98
---------------------------------
STATE OF ALABAMA )
COUNTY OF JEFFERSON )
I, the undersigned Notary Public in and for said County, in said State,
hereby certify that MICHAEL L. STANWOOD, whose name as President, of STANREAL,
LLC, a Texas limited liability company, the General Partner of STANWOOD
INTERESTS LIMITED PARTNERSHIP, a Texas limited partnership, is signed to the
foregoing instrument and who is known to me, acknowledged before me on this day
that, being informed of the contents of said instrument, he as such officer and
with full authority, executed the same voluntarily for and as the act of said
partnership on the day the same bears date.
Given under my hand and official seal, this 13th day of May, 1996.
/s/ Robert A. Paine
--------------------------------
Notary Public Robert A. Paine
My Commission Expires:
2-2-98
---------------------------------
13
STATE OF ALABAMA )
COUNTY OF JEFFERSON )
I, the undersigned Notary Public in and for said County, in said State,
hereby certify that David H. Hughes, whose name as Chairman of HUGHES SUPPLY,
INC. a Florida corporation, is signed to the foregoing instrument and who is
known to me, acknowledged before me on this day that, being informed of the
contents of said instrument, he as such officer and with full authority,
executed the same voluntarily for and as the act of said corporation on the day
the same bears date.
Given under my hand and official seal, this 13th day of May, 1996.
/s/ Robert A. Paine
--------------------------------
Notary Public Robert A. Paine
My Commission Expires:
2-2-98
---------------------------------
14
[MAP]
EXHIBIT A (PAGE 1)
LEGAL DESCRIPTION
[ILLEGIBLE]
EXHIBIT A (PAGE 2)
Hughes Supply, Inc.
New Location Insurance Information
- --------------------------------------------------------------------------------
Please complete the following information required to establish insurance
coverage for new branch locations:
1) New branch name: SOUTHWEST GEORGIA
Street (physical) address: 2331 Varkel Way
City, State, Zip Code: Lithonia, GA 30058
Location code (branch number): 009040
Expected date branch will open: May 13, 1996
2) Maximum anticipated inventory value: $2,024,665.22
Maximum anticipated furniture and fixtures value: $ 183,526.28
Total contents value (total of above): $2,208,191.50
3) Is this new location located within an already existing HSI branch? No
If yes, please disregard questions 4 through 9.
4) Building construction type (metal, concrete, etc.): Metal
5) Approximate age of building (in years): 10 years
6) Total building square footage: 15,000 sq. ft.
7) Please check one of the following:
|_| (a) The building is owned by Hughes Supply, Inc. or leased from
Hughes, Inc.
|X| (b) The building is leased from an outside party (other than
Hughes, Inc.) and insurance coverage is required to be provided
by Hughes Supply, Inc. under the terms of the lease agreement.
|_| (c) The building is leased from an outside party (other than Hughes,
Inc.) and insurance coverage is not required to be provided by
Hughes Supply, Inc. under the terms of the lease agreement.
8) If you checked (a) or (b) in question 7 above, please indicate the value
of the building: $331,000.00
9) If this new location replaces another existing location (i.e. due to a
move) and the old location is no longer owned or occupied by Hughes
Supply. Inc., please complete the following information:
Old branch name: N/A
Street (physical) address: ________________
City, State, Zip Code: ________________
<page>
March 19, 1999
VIA CERTIFIED MAIL
RETURN RECEIPT REQUESTED VIA OVERNIGHT MAIL
SWS-GA Realty, Inc. Stanwood Interests Limited Partnership
320 Park Place Tower c/o Michael L. Stanwood
2001 Park Place North 8505 Monroe Road
Birmingham, AL 35203 Houston, TX 77061
Re: Branch No. 9040 Atlanta SWS
Lease Agreement dated May 13, 1996 by and between SWS-GA
Realty, Inc., and Stanwood Interests Limited Partnership, as
Lessor, and Hughes Supply, Inc., as Lessee ("Lease")
Dear Sirs:
Pursuant to Section 3 of the above referenced Lease, please be advised
that Hughes Supply, Inc. has elected to extend the term of the Lease for an
additional three (3) years. The extended term will commence May 13, 1999 and
will expire May 12, 2002, and will be on all of the terms and conditions of the
Lease.
Please sign and date the Landlord Consent at the bottom of this letter
and return it by overnight mail in the enclosed Federal Express envelope. Thank
you for your assistance with this matter.
Very truly yours,
Mark Scimeca,
Associate General Counsel
Enclosure
c: Pat Chilton, Branch Manager (via inter-branch mail)
Benjamin P. Butterfield, Esquire (via hand delivery)
Landlord Consent:
Accepted and Agreed to by:
SWS-GA Realty, Inc.
By: Date:
--------------------------------- --------------
Landlord
Landlord Consent:
Accepted and Agreed to by:
Stanwood Interests Limited Partnership
By: Date:
--------------------------------- --------------
Landlord
<page>
April 1, 1999
VIA CERTIFIED MAIL
RETURN RECEIPT REQUESTED VIA OVERNIGHT MAIL
SWS-GA Realty, Inc. Stanwood Interests Limited Partnership
320 Park Place Tower c/o Michael L. Stanwood
2001 Park Place North 8505 Monroe Road
Birmingham, AL 35203 Houston, TX 77061
Re: Branch No. 9040 Atlanta SWS
Lease Agreement dated May 13, 1996 by and between SWS-GA
Realty, Inc., and Stanwood Interests Limited Partnership, as
Lessor, and Hughes Supply, Inc., as Lessee ("Lease")
Dear Sirs:
Pursuant to Section 3 of the above referenced Lease, please be advised
that Hughes Supply, Inc. has elected to extend the term of the Lease for an
additional five (5) years. The extended term will commence May 13, 1999 and will
expire May 12, 2004, and will be on all of the terms and conditions of the
Lease.
Please sign and date the Landlord Consent at the bottom of this letter
and return it by overnight mail in the enclosed Federal Express envelope. Thank
you for your assistance with this matter.
Very truly yours,
Mark Scimeca,
Associate General Counsel
Enclosure
c: Pat Chilton, Branch Manager (via inter-branch mail)
Jeff Clyne, General Manager (via inter-branch mail)
Benjamin P. Butterfield, Esquire (via hand delivery)
Landlord Consent:
Accepted and Agreed to by:
SWS-GA Realty, Inc.
By: Date:
--------------------------------- ---------------
Landlord
Landlord Consent:
Accepted and Agreed to by:
Stanwood Interests Limited Partnership
By: Date:
--------------------------------- ---------------
Landlord