Exhibit 10.18
LEASE AGREEMENT
This lease is made and entered into this 19th day of June, 2003, by and
between NGE LEASING INC.., hereinafter called Lessee, and Wise Commercial
Properties, hereinafter called Lessor, whether one or more.
ARTICLE 1. DEMISE. DESCRIPTION. TERM AND RENT
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1.01 Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, that
certain property located at, hereinafter called the Leased Premises, 107 P.R.
1420 Bridgeport, Texas situated in Wise County , as described in Exhibit "A",
which is attached hereto and made a part hereof by reference, for the term of 3
year(s) commencing on, September 1, 20 03 , and ending on, August 31, 2006 .
ARTICLE 2. OPTION TO RENEW OR EXTEND
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Terms of Option
2.01 Lessee is hereby granted and shall, if not at the time in default under
this lease, have an option to extend the term of this lease for an additional
period of 2 year(s) from the termination date hereof, but otherwise on the same
terms, covenants, rental and conditions however the Lessor shall have the option
to raise the rent (and subject to the same exceptions and reservations) herein
contained.
How Exercised
2.02 This option shall be exercised only by Lessee's delivering to Lessor in
person or by United States mail no less than ninety (90) days before the end of
the primary term, written notice of its election to extend the term of this
lease as herein provided.
2.03 Holding Over. In the event Lessee shall continue to occupy the Leased
Premises after the expiration of the term hereof, such holding over shall be
deemed to have created a month-to-month tenancy subject to all the terms and
conditions of this Lease. In the event of such holding over, Lessee shall pay
Lessor monthly in advance minimum monthly rent equal to one point twenty five
(1.25) times the greatest rental provided in Section 2.1 hereof during such
holding over.
ARTICLE 3. RENT
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General Rent
3.01 Minimum Monthly Rent. Lessee shall pay as a minimum rental in such amounts
and for such periods as stated below, without deduction, setoff, prior notice or
demand, with payments due in advance on the first (1st) day of each calendar
month during the entire term of this Lease and any extensions, the following:
(a) From the first 1st month through and including the 36th month, minimum
rent at an annual rate of EIGHT-TEEN THOUSAND AND NO/100 CENTS
($18,000.00) payable in equal monthly installments of ONE THOUSAND
FIVE HUNDRED AND NO/100 CENTS ($1,500.00);
In the event the term of this Lease commences or ends on a date other than the
first day of the month, the minimum monthly rent for the first and last such
fractional months of the term of this Lease, as the case may be, shall be
prorated in the proportion that the number of days of Lessee's tenancy during
any such fractional month bears to thirty (30) days, and shall be payable on the
first day of such month.
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3.02 Security Deposit. No Security Deposit Required. Upon the execution of this
Lease, Lessee agrees to pay Lessor the sum of THREE THOUSAND AND NO/100 CENTS
($3,000.00 ), of which ONE THOUSAND FIVE HUNDRED AND NO/100 CENTS ($1,500.00)
shall be applied to the minimum monthly rent due with respect to the first month
rent of the term of this Lease, and ONE THOUSAND FIVE HUNDRED AND NO/100 CENTS
($1,500.00) for the last month rent of the term of this Lease.
Default
3.03 Lessor's Default. In the event of breach by Lessor of any covenant,
warranty, term or obligation under this Lease on Lessor's part to be performed,
and Lessor's failure to cure the same within thirty (30) days after written
notice thereof by Lessee, Lessee's sole remedy shall be to terminate this Lease,
whereupon all advance rental hereunder not then having been applied against
minimum monthly rent payments shall be returned forthwith to Lessee, and all
obligations of Lessee and Lessor hereunder shall terminate forthwith.
3.04 Lessee's Default. Each of the following events shall be a default hereunder
by Lessee and a breach of this Lease:
(a) If Lessee shall file a petition in bankruptcy or insolvency or for
reorganization or arrangement under the bankruptcy laws of the United
States or any insolvency act of any state or shall voluntarily take
advantage of any such law or act by answer or otherwise or shall be
dissolved or shall make an assignment for the benefit of creditors;
(b) If involuntary proceedings under any such bankruptcy law or insolvency
act or for the dissolution of a corporation shall be instituted
against Lessee or if a receiver or trustee shall be appointed of all
or substantially all of the property of Lessee and such proceedings
shall not be dismissed or such receivership or trusteeship vacated
within thirty (30) days after such institution or appointment;
(c) If Lessee shall fail to pay Lessor any rent or additional rent when
the same shall become due and payable and shall not cure the default
within five (5) days after notice of same;
(d) If Lessee shall fail to perform any of the agreements, terms,
covenants, or conditions hereof on Lessee's part to be performed and
such non-performance shall continue for the period within which
performance is required to be made by specific provision of this
Lease, or if no such period is so provided, for a period of thirty
(30) days after notice thereof by Lessor to Lessee or, if such
performance cannot be reasonably had within such thirty (30) day
period, Lessee shall not in good faith have commenced such performance
within such thirty (30) day period and shall not diligently proceed
therewith to completion;
(e) If Lessee shall vacate or abandon the Leased Premises; or
(f) If this Lease or the estate of Lessee hereunder shall be transferred
to or shall pass to or devolve unto any other person or party, except
in a manner permitted under Article VII hereof.
If this Lease shall be held by a permitted assignee or successor of Lessee,
the provisions of clauses (a) and (b) of this subsection shall apply only to
such assignee or successor while in possession of the Leased Premises.
3.05 Lessor's Remedies. If any event set forth in Section 10.2 hereof shall
occur, Lessor, in addition to any other rights or remedies it may have by
statute or otherwise, including the right to take no action other than to xxx
for damages or rental in default, shall have the immediate right of re-entry and
may remove all persons and property from the Leased Premises. Such property may,
but need not, be removed and stored in a public warehouse or elsewhere at the
cost of and for the account of Lessee. Should Lessor elect to re-enter by giving
notice of such intention to Lessee, as herein provided, or should Lessor
actually take possession by physical act or pursuant to legal proceedings or any
notice provided for by law, Lessor may either terminate this Lease or may
attempt to relet the Leased Premises or any part thereof, including any
buildings, improvements or personal property of Lessee located thereon, for the
account of Lessee for such term or terms (which may be for a term extending
beyond the term of this Lease) and at such rental or rentals payable to Lessor
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and upon such other terms and conditions as Lessor in the exercise of Lessor's
sole discretion may deem advisable, with the right to make alterations and
repairs to said Leased Premises at Lessee's expense for the purposes of such
reletting.
If Lessor elects to re-enter and attempt to relet the Leased Premises, Lessee
shall remain fully liable for all obligations of Lessee under this Lease. Lessor
shall give notice of any reletting without termination to Lessee and upon each
such reletting (a) Lessee shall be immediately liable for and shall pay to
Lessor, as additional rent and in addition to any other sums due hereunder, the
costs and expenses of such reletting (including advertising costs, brokerage
fees, any reasonable attorney's fees incurred and the cost of any alterations
and repairs incurred by Lessor), and shall also become immediately liable for
and shall pay to Lessor the amount, if any, by which the rent reserved in this
Lease for the period of such reletting (up to but not beyond the term of this
Lease) exceeds the amount agreed in such reletting to be paid as minimum rent
for the Leased Premises for said period; or (b) at the option of Lessor given in
such notice of reletting, rents received by Lessor from such reletting shall be
applied first to the payment of any indebtedness other than rent due hereunder
from Lessee to Lessor; second, to the payment of the costs and expenses of such
reletting (including advertising costs, brokerage fees, any reasonable
attorney's fees incurred and the costs incurred for alterations and repairs);
third, to the payment of rent and other charges due and unpaid hereunder; and
the residue, if any, shall be held without interest to Lessee by Lessor and
applied in payment of future rent as the same may become due and payable
hereunder. If Lessee has been credited with any rent to be received by reletting
under option (a) and such rents shall not be promptly paid to Lessor by the new
tenant, or if rent received from such reletting under option (b) during any
month be less than that to be paid during that month by Lessee hereunder, Lessee
shall pay any deficiency to Lessor. Such deficiency shall be calculated and paid
upon demand by Lessor; if any such monthly payments are not made upon demand,
Lessor may at any time undertake legal proceedings to recover all such payments,
whether one or more payments are past due, and Lessee shall be liable for all
attorney's fees of Lessor in connection with attempts to recover said payments,
whether or not legal proceedings are commenced.
No re-entry or taking possession of the Leased Premises by Lessor shall be
construed as an election on Lessor's part to terminate this Lease unless a
written notice of such intention be given to Lessee or unless the termination
thereof be decreed by a court of competent jurisdiction. Notwithstanding any
reletting or attempted reletting without termination, Lessor may at any time
thereafter elect to terminate this Lease for such previous default. Should
Lessor at any time terminate this Lease for any default, in addition to any
other remedy Lessor may have, Lessor may recover from Lessee all damages Lessor
may incur by reason of such default, including the cost of recovering the Leased
Premises (including attorney's fees, court costs, and storage charges), the
amount of rental payments then in default, the worth at the time of such
termination of the excess, if any, of the amount of rent and additional rent
reserved in this Lease for the remainder of the stated term over the then
reasonable rental value of the Leased Premises for the remainder of the stated
term, and any other amount necessary to compensate Lessor for all the detriment
proximately caused by Lessee's failure to perform his obligations under this
Lease or which in the ordinary course of events would be likely to result
therefrom, all of which amounts shall be immediately due and payable from Lessee
to Lessor upon demand. The "worth at the time of termination" of any amounts
referred to above shall be computed by discounting such amounts in effect at the
time of the termination of this Lease. No compensation, damage or allowance
shall be made to Lessee upon such termination for any buildings or other
improvements located on the Leased Premises, and all right, title and interest
of Lessee in or to the Leased Premises and said buildings and other
improvements, whether in law or in equity, shall immediately cease and
terminate, all with the same force and effect as if the term of this Lease had
duly expired.
Whenever under this Section Lessee shall be liable for the payment of additional
rent to Lessor, for any deficiency in rent received by Lessor upon reletting, or
for damages measured by rent, and the amount of the additional percentage rent
which would have accrued for a specific period is not known, rent shall include
the minimum rent for that period plus a sum for additional percentage rent for
the period based upon the average annual percentage rental required to be paid
by Lessee during the two annual periods immediately preceding the date of
default (or if two full annual periods during which minimum monthly rent payable
hereunder have not elapsed, then the period between the date upon which payment
of minimum monthly rent under this Lease commenced and the date of such default)
with proportionate adjustment for partial annual periods. In addition, Lessee
shall be liable for all charges incurred or to be incurred by Lessor during such
period for all costs and expenses required to be borne by Lessee hereunder,
which charges may be estimated by Lessor on the basis of past charges. If this
Lease continues in effect after any payment of rent calculated on the basis of
estimates or averages as above provided, including additional percentage rent,
Lessee's actual liability for such charges shall be adjusted as any rent from
tenants to whom the Leased Premises are relet is received or as the actual
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amount of additional rent due from Lessee becomes known. Such adjustments shall
be made periodically as Lessor deems appropriate, but not less often than
yearly, and Lessor shall give Lessee notice of such adjustments and of any
amounts due from Lessee to Lessor, which amounts shall be payable on demand.
3.06 Penalty for Late Payment and Lessor Reimbursement. Lessee understands that
in the event Lessee fails to pay Lessor any sums owed Lessor hereunder, Lessor
will be forced to incur additional costs and expenses, both administratively as
a result of having to make demands upon Lessee, and financially for the loss of
use of Lessor's money. In that regard, Lessee agrees to pay an administrative
late charge in the amount of $10.00 per day for each working day after the tenth
of any month in which any rent payment has not been received. In addition,
should payment not be received by the tenth of any month, Lessee agrees to pay
interest at the rate of 12% per annum, retroactive to the first, on such
delinquent rental (excluding, however, any accrued late charges, which shall not
bear interest). Interest on any sums due under this Lease shall not exceed the
maximum rate allowed by law. Any interest in excess of the maximum rate allowed
by law shall be credited to the principal amount of the debt or if that has been
paid, refunded. This provision overrides all other provisions in this Lease. In
the event the Lessor is required to retain the services of an attorney to
collect past due rentals and/or real estate taxes, Lessee shall be required to
reimburse Lessor such costs and expenses incurred by the Lessor.
ARTICLE 4. TAXES AND ASSESSMENTS
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Hold Harmless Clause
4.01 Lessee agrees to and shall protect and hold harmless Lessor and the Leased
Premises from liability for any personal property taxes, assessments, and
charges levied or assessed upon Lessee's personal property located on the Leased
Premises, together with any interest, penalties, or other sums thereby imposed,
and from any sale or other proceeding to enforce payment thereof.
Separate Assessments of Real and Personal Property
4.02 During the term hereof, Lessor and Lessee agree to cause all taxes,
assessments, and other charges levied on or imposed on any of Lessee's personal
property situated in, on, or about the Leased Premises to be levied on or
assessed separately from the Leased Premises and not as a lien thereon.
4.03 Lessee's Representations and Warranties. The Lessee represents and warrants
that the execution, delivery and performance of this Lease (i) have been duly
authorized by all requisite action, (ii) will not violate or contravene any
provision of any agreement or other instrument to which Lessee is party or bound
and that this Lease is the legal, valid and binding obligation of Lessee,
enforceable in accordance with its terms.
ARTICLE 5. DESTRUCTION OF PREMISES
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Total Destruction
DAMAGE, DESTRUCTION AND CONDEMNATION
5.01 Damage or Destruction to Premises. In the event that any of the
improvements on the Leased Premises are damaged, destroyed or lost as the result
of any act of Lessee or other casualty, the net proceeds of any insurance
payable in respect of such damage or destruction shall be paid to Lessor and
Lessor shall forthwith repair, restore and reconstruct such damaged or destroyed
improvements, so that upon completion thereof such improvements shall be
substantially the same as before the occurrence of such damage or destruction.
In the event Lessor fails to commence such repair, restoration or reconstruction
within thirty (30) days following its occurrence and thereafter diligently
prosecute the same to completion, Lessee may, upon furnishing to Lessor written
notice of its election to do so, cause such repair, restoration or
reconstruction to be done, and the net cash proceeds of the insurance payable in
respect of the damage to be repaired shall be paid to Lessee. There shall be no
abatement of rent during the repairs, restoration or reconstruction contemplated
by this subsection.
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5.02 Condemnation of Premises.
(a) The term "condemnation" as used in this Section shall mean the
exercise of the power of eminent domain by any person, entity, body,
agency or authority, or private purchase in lieu of eminent domain.
The "date of condemnation" shall mean the date on which the actual
physical taking of possession pursuant to the exercise of such power
of eminent domain, or private purchase in lieu thereof, occurs, or the
date of settlement or compromise of the claims of the parties thereto
during the pendency of the exercise of such power, whichever first
occurs, and property is deemed "condemned" on such date.
(b) In the event the entire Leased Premises are taken through
condemnation, this Lease shall terminate on the date of condemnation.
In such event the rent and additional rent payable by Lessee hereunder
shall be apportioned and paid to such date.
(c) In the event that twenty percent (20%) or more but less than the
entirety of the Leased Premises is taken through condemnation so that,
in Lessee's reasonable opinion, such Leased Premises are no longer
suitable for the continuation of the business then being conducted
thereon, this Lease shall terminate on the date of condemnation. In
such event the rent and additional rent payable by Lessee hereunder
shall be apportioned and paid to such date.
(d) In the event that twenty percent (20%) or more but less than the
entirety of the Leased Premises is taken through condemnation such
that the remaining part thereof, in Lessee's reasonable opinion,
remains reasonably suitable for Lessee's continued occupancy and
conduct of the business then being conducted thereon, this Lease
shall, as to the part so taken, terminate on the date of condemnation,
and the minimum monthly rent shall thereupon be reduced in the same
proportion that the number of square feet of the building so taken
bears to the number of square feet of the building.
(e) Lessor and Lessee shall each be entitled to receive and retain such
separate awards and portions of lump sum awards, including severance
damages, if any, as may be allocated to their respective interests in
any condemnation proceedings. Lessee shall also be entitled to any
award made to it for depreciation to or loss of and cost of removal of
furniture, fixtures, equipment and inventory. Termination of this
Lease shall not affect the rights of the respective parties to such
awards.
(f) Each party agrees to execute and deliver to the other all instruments
that may be required to effectuate the provisions of this Section.
ARTICLE 6. UTILITIES
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6.01 Lessee, shall during the term hereof pay all charges for telephone, gas,
electricity, and water used by Lessee in or on the Leased Premises and for the
removal of rubbish therefrom before they shall become delinquent and shall hold
Lessor harmless from any liability therefore.
ARTICLE 7. ENVIRONMENTAL INDEMNITY
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7.01 Lessor shall be responsible for and save Lessee harmless from any
environmental damages or clean up costs relating to any conditions existing
prior to the commencement date of this Lease. Lessee shall not commit, or suffer
to be committed, any waste on the Leased Premises, nor shall it maintain, commit
or permit the maintenance or commission of any nuisance on the Leased Premises.
Lessee shall be responsible for and save Lessor harmless from any environmental
damages, clean up costs, legal costs, fines and penalties relating to Lessee's
use of the Leased Premises.
Hazardous Substance or Waste. In the event any "hazardous substance" or
"hazardous waste" as those terms are used in the various federal and state
environmental laws (hereinafter referred to as the "hazardous
substance/waste") is discovered at any time during the term of this Lease
or any extensions thereof, or any time thereafter, under circumstances
where it is reasonably clear that such hazardous substance/waste became
present at any time after the Effective Date until the expiration or
earlier termination of this Lease, and same resulted from an act or
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omission of Lessee, its subtenants, agents, employees, customers or other
invitees, Lessee shall indemnify, defend (with counsel reasonably
satisfactory to Lessor) and hold and save Lessor harmless from and against
any and all claims, liabilities, actions, judgments, responsibilities and
damages of every kind and nature arising from or related to the presence of
said hazardous substance/waste.
ARTICLE 8. REPAIRS
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Lessor's and Lessee's Duties to Repair
8.01 Lessee shall maintain the Leased Premises in a condition fit for its
intended use and shall make all necessary repairs and Lessee shall make all
repairs of the Leased Premises occasioned by its negligent use of the Leased
Premises. During the term of this Lease, Lessee shall, at its sole cost and
expense, maintain the Leased Premises and the improvements thereon in good
condition and repair, reasonable wear and tear and depreciation accepted, and
shall maintain all service areas within the Leased Premises in a clean and
rubbish-free condition. Lessee shall, prior to the commencement of the Lease,
place the Leased Premises in a first class condition for operation. Lessee shall
maintain all landscaped areas within the Leased Premises free from weeds, pruned
and clipped, and not permit these landscaped areas to become unsightly,
overgrown, so as to detract from the condition of the Leased Premises. Lessee
shall maintain any adjoining streets and the whole of such Leased Premises in a
clean and sanitary condition, in accordance with all applicable state, city and
county health and sanitation laws and ordinances and as directed by the proper
public officials during the term of this Lease. Lessor shall not be called upon
to make any improvements or repairs in or upon the Leased Premises during the
term of this Lease except as expressly required or permitted herein. Provided,
however, that any alteration, repair or change which may be required by law,
regulation or rule resulting from non-compliance by Lessor with the terms of
this Lease shall be the sole responsibility and expense of Lessor. Lessee
covenants and agrees to pay promptly when due all claims for work and materials
furnished in connection with its maintenance of such improvements, and shall not
permit or suffer any liens or encumbrances to the Leased Premises. In the event
Lessee shall default under this Section, as determined by Section 10.2(d)
hereof, Lessor may, but shall not be obligated to, cure such default by
undertaking any and all corrective work and Lessee shall reimburse Lessor for
all costs and expenses Lessor thereby sustains.
Lessor's Duty
8.02 Lessor guarantees that on the date of commencement of this Lease that the
Leased Premises will have:
(1) Effective waterproofing and weather protection of roof and exterior
walls, including unbroken windows and doors.
(2) Plumbing facilities that conform to applicable law in effect at the
time of installation, maintained in good working order.
(3) A water supply approved under applicable law which is under the
control of Lessee, capable of producing hot and cold running water, or
a system which is under the control of Lessor, which produces hot and
cold running water, furnished to appropriate fixtures and connected to
a sewage disposal system under applicable law.
(4) Heating and cooling facilities which conform to applicable law at the
time of installation, maintained in good working order.
(5) Electrical lighting, with wiring and electrical equipment that conform
to applicable law at the time of installation, maintained in good
working order.
(6) Building, grounds, and appurtenances at the time of the commencement
of the lease in every part clean, sanitary, and free from all
accumulations of debris, filth, rubbish, garbage, rodents, and vermin,
and all areas under control of Lessor thereafter kept in every part
clean, sanitary, and free from all accumulations of debris, filth,
rubbish, garbage, rodents, and vermin.
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(7) Floors maintained in good repair.
Lessee's Duties Correlative to Lessor's Obligations
8.03 No duty on the part of the Lessor shall arise with respect to maintenance
or repairs under this lease if Lessee is in substantial violation of any one or
more of the following affirmative obligations:
(1) To keep its Leased Premises, which it occupies and uses, as clean and
sanitary as is reasonable under the circumstances.
(2) To dispose from its Leased Premises all rubbish, garbage, and other
waste, as is reasonable under the circumstances.
(3) Not to permit any person on the premises, with Lessee's permission, to
willfully or wantonly destroy, deface, damage, impair, or remove any
part of the Leased Premises or the facilities, equipment, or
appurtenances thereto.
Lessee's Right to Repair for Lessor
8.04 (1) If within 30 days notice to Lessor of repairs or maintenance which
Lessor has a duty to repair, and if Lessor neglects to make such
repairs, Lessee may repair the same itself, where the cost of the
repairs does not require an expenditure greater than one month's rent
of the premises, and deduct the expenses of such repairs from the
rent. However, Lessee may not vacate the premises nor will Lessee be
discharged from further payment of rent, or performance of other
conditions.
(2) For purposes of this Paragraph 8.06, if Lessee makes repairs at least
30 days following his giving notice to Lessor, Lessee will be presumed
to have acted after a reasonable time.
ARTICLE 9. ALTERATIONS, IMPROVEMENTS AND FIXTURES
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9.01 Lessee shall have the right at any time and from time to time during the
term and any extended term hereof at its sole cost and expense, to affix and
install such property and equipment to, in, or on the Leased Premises as it
shall in its sole discretion deem advisable. Lessee shall have the right to
erect signs on the Leased Premises, including the exterior walls of the
building. Lessee shall, at its own expense, be responsible for the erection and
maintenance of exterior signage required to advertise Lessee's business within
the Leased Premises. The size, color, form and other details concerning any
signs to be placed on the Leased Premises shall be determined by Lessee, subject
to Lessor's reasonable approval. Lessee covenants and agrees that its exterior
signage shall not impede the visibility of, or block or obstruct, Lessor's
signage on the property contiguous to the Leased Premises and shall in all
respects comply with applicable governmental requirements. Any such fixtures,
signs, equipment, and other property installed in or affixed to or on the Leased
Premises shall remain the property of Lessee, and Lessor agrees that Lessee
shall have the right at any time, and from time to time, to remove any and all
such fixtures, equipment, and other, property; provided, however, that any such
fixtures, equipment, or property not removed from the premises within thirty
(30) days after expiration or sooner termination of the term or extended term
hereof shall be deemed to have been abandoned by Lessee and shall thereupon
become the absolute property of Lessor without compensation to Lessee. Lessee
shall repair any damage caused by the removal of fixtures pursuant to this
paragraph.
9.02 Lessee shall have the right at its own cost and expense from time to time
during the term or any extended term hereof to construct on the Leased Premises
such buildings and other improvements, and make such alterations, additions, and
changes therein as it deems necessary or convenient for its purposes, and it
shall be permitted from time to time during and within thirty (30) days after
expiration or sooner termination of the term hereof to remove any such building
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or other improvements erected or made by it; provided, however, that Lessee
shall repair any damages to the Leased Premises caused by such removal and
further provided that any such building or improvement which shall not have been
removed by Lessee on or within thirty (30) days after expiration or sooner
termination of the term or any extended term hereof shall be deemed abandoned by
Lessee and shall thereupon become the absolute property of Lessor without
compensation to Lessee, and Lessee shall not be required on such abandonment to
restore the premises to their present condition.
MAINTENANCE, ALTERATIONS AND USE
9.03. Use of Premises. The Leased Premises shall be used solely for the
operation of Office, Warehouse, & Storage Yard_ and shall neither be maintained
nor used in a manner, which violates any applicable law, rule, ordinance or
regulation of any governmental body. Lessee shall not permit the Leased Premises
to be used for any purpose, which would increase the existing rate of or
adversely affect the coverage under any policy of insurance thereon or render
the insurance void or the insurance risk more hazardous.
9.04 Alterations of Premises.
(a) Lessee shall not at any time during the term of this Lease make any
alteration, rebuilding, replacement, change, addition or improvement
in or to the Leased Premises or to any improvement thereon unless:
(i) The same shall be performed in a first class workmanlike manner,
at Lessee's sole cost and expense, and shall not weaken or impair
the structural strength, or lessen the value of such improvements
as shall be on the Leased Premises at the time, or change the
purposes for which such improvements may be used;
(ii) The same shall be made according to plans and specifications
therefore, which shall be first submitted to and approved in
writing by Lessor, said consent not to be unreasonably withheld;
(iii)Before the commencement of any such work such plans and
specifications shall be filed with and approved by all
governmental departments or authorities having jurisdiction, and
any public utility company having an interest therein, and all
such work shall be done subject to and in accordance with the
requirements of law and local regulations of all governmental
departments or authorities having jurisdiction and of such public
utility company, as the case may be;
(iv) Before the commencement of any such work, Lessee shall pay the
amount of any increase in premiums on insurance policies provided
for under this Lease on account of endorsements to be made
thereon covering the risk during the course of such work, and
workmen's compensation insurance covering all persons employed in
connection with the work and with respect to whom death or bodily
injury claims could be asserted against Lessor or the Leased
Premises shall be maintained by Lessee at its sole cost and
expense at all times when any such work is in progress; and
(v) With respect to each contract or agreement (oral or written) for
labor, services, materials or supplies in connection with any
such alteration, rebuilding, replacement, change, addition or
improvement before the commencement of any such work, Lessee
shall deliver to Lessor either (i) a duplicate original of such
contract, if in writing, which shall provide that no lien or
claim shall thereby be created, or arise, or be filed by anyone
thereunder upon or against the Leased Premises, or the buildings
or improvements thereof, or to be erected on the Leased Premises
or any of the equipment thereon or (ii) a written waiver by the
architect, engineer, contractor, subcontractor, material man,
mechanic, and each other person or corporation contracting to
furnish such labor, services, materials or supplies, of all right
of lien which he or it might otherwise have upon or against the
Leased Premises, or the buildings or improvements to be altered,
repaired, improved or constructed, or the interest of Lessor
therein.
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(b) All buildings, alterations, rebuilding, replacements, changes,
additions, improvements and appurtenances on or in the Leased Premises
at the commencement of the lease term, and which may be erected,
installed or affixed on or in the Leased Premises during the term
hereof, are and shall be deemed to be and immediately become part of
the realty and the sole and absolute property of Lessor and shall be
deemed to be part of the Leased Premises, except that all movable
trade fixtures installed by Lessee, any assignee or any sub-lessee
shall be and remain the property of Lessee, such assignee or such
sub-lessee, as the case may be.
ARTICLE 10. COVENANTS
---------------------
Covenant of Quiet Possession
10.01 Lessor shall on the commencement date of the term of this lease as
hereinabove set forth , place Lessee in quiet possession of the Leased Premises
and shall secure it in the quiet possession thereof against all persons lawfully
claiming the same during the entire lease term and any extensions thereof.
ARTICLE 11. DELIVERY OF POSSESSION
----------------------------------
11.01 If Lessor shall be able to deliver possession of the Leased Premises
before the commencement date of the term hereof, and in the event Lessor is
unable to deliver possession until after the commencement date of this lease.
The commencement date and terms of this lease shall be prorated from the date of
delivery to the first day of the month following the delivery date of the Leased
Premises.
ARTICLE 12. SURRENDER OF PREMISES
---------------------------------
Surrender
12.01 Lessee agrees to and shall, on expiration or sooner termination of the
term hereof or of any extended term hereof, promptly surrender and deliver the
Leased Premises to Lessor in good condition, ordinary wear and tear excepted.
ARTICLE 13. INSPECTION BY LESSOR
--------------------------------
13.01 Lessee shall permit Lessor and its agents to enter into and upon the
Leased Premises at all reasonable times for the purpose of inspecting the same
or for the purpose of maintaining or making repairs or alterations to the
building.
ARTICLE 14. ASSIGNMENT AND SUBLEASE
-----------------------------------
Assignment and Subletting by Lessee
14.01 Lessee or its permitted assignee may not sublet the Leased Premises, in
whole or in part, without first obtaining the prior written consent of Lessor.
It is specifically understood and agreed by and between Lessor and Lessee that
any subletting which Lessee or its permitted assignees make, as permitted
herein, shall in no event relieve Lessee of the obligations of Lessee hereunder,
and that the right of subletting shall be that of Lessee or its permitted
assignees only, and shall not extend to any subtenant. Any consent to any
subletting shall not be deemed to be a consent to any subsequent subletting.
ARTICLE 15. INSURANCE
---------------------
15.01 Insurance.
(a) Lessor shall, at all times during the term of this lease, maintain a
policy or policies of insurance issued by a solvent insurance company,
insuring Lessor's interest in the Leased Premises against all risks,
for the full replacement value thereof. Lessee shall maintain in force
a like policy insuring Lessee's interest in any furniture, equipment,
machinery, goods or supplies which Lessee may bring or obtain upon the
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Leased Premises, or any improvements which Lessee may construct
thereon. Lessor and Lessee each waive, and shall cause their insurers
to waive, any and all rights of recovery for any loss or damage which
may occur to the Leased Premises, any improvements thereto, or any
personal property of any party therein, by reason of any cause which
Lessor or Lessee is required to insure against under this paragraph.
(b) Indemnity. Lessee hereby releases and agrees to defend, indemnify and
hold Lessor harmless from and against all claims or causes of action
for damage or injury to persons or property arising out of Lessee's
negligent use or occupancy of the Leased Premises. Lessor hereby
releases and agrees to defend, indemnify and hold Lessee harmless from
and against all claims or causes of action for damage or injury to
persons or property arising out of Lessor's negligence under the
lease.
(c) Liability Insurance. Lessee shall maintain, at their own expense,
policies of comprehensive general liability insurance, issued by a
solvent insurance company licensed to do business in the State of
Texas, with insurance to afford minimum protection of not less than
$1,000,000 for personal injury or death arising from any one
occurrence, and of not less than $500,000 for property damage arising
from any one occurrence. Said policies, as maintained by Lessor and
Lessee shall each contain contractual liability coverage with respect
to the indemnification obligations set forth in paragraph (b) herein.
15.02 Requirements of Law.
(a) During the term of this Lease, Lessee shall, at it own cost and
expense, promptly observe and comply with all present and future laws,
ordinances, requirements, orders, directions, rules and regulations of
the federal, state, county and municipal governments and of all other
governmental authorities having or claiming jurisdiction over the
Leased Premises or appurtenances or any part thereof, and of all their
respective departments, bureaus and officials, and of the insurance
underwriting board or insurance inspection bureau having or claiming
jurisdiction, or any other body exercising similar functions, and of
all insurance companies writing policies covering the Leased Premises
or any part thereof, whether such laws, ordinances, requirements,
orders, directions, rules or regulations relate to structural
alterations, changes, additions, improvements, replacements or
repairs, either inside or outside, extraordinary or ordinary, foreseen
or unforeseen, or otherwise, to or in and about the Leased Premises,
or any building thereon, or to any passageways, franchises, or
privileges appurtenant thereto or connected with the enjoyment thereof
or to alterations, changes, additions, improvements, replacements or
repairs incident to or as a result of any use or occupation thereof,
or otherwise, including, without limitation, the removal of any
encroachment on the street or on adjoining premises by any building on
the Leased Premises, and whether the same are in force at the
commencement of the term of this Lease or may in the future be passed,
enacted or directed.
(b) Lessee, after notice to Lessor, may, by appropriate proceedings
conducted promptly at Lessee's own expense, in Lessee's name and/or
(whenever necessary) Lessor's name, contest in good faith the validity
or enforcement of any such statute, law, ordinance, regulation or
order. So long as (i) such deferment shall not subject Lessor to a
fine or other criminal liability, (ii) Lessee shall be diligently
prosecuting such contest to a final determination by a court,
department or governmental authority or body having jurisdiction
thereof, and (iii) Lessee shall have furnished Lessor with such
security, by bond or otherwise, as Lessor may request in connection
with such contest, Lessee may defer compliance with such statute, law,
ordinance, regulation or order.
15.03 Security and Improper Acts. Lessee shall not perform and shall not permit
any acts or practices upon the Leased Premises, which may injure the public, or
the improvements located on the Leased Premises. Lessee shall be responsible for
monitoring and maintaining the safety and security of the Leased Premises.
Lessee shall properly maintain the trash receptacles and storage bins on the
Leased Premises and shall not permit any noxious or offensive fumes, odors or
noises to emanate from the Leased Premises.
15.04 Indemnification. To the fullest extent permitted by applicable law, Lessee
agrees to indemnify, protect, defend and hold harmless Lessor, Lessor's
partners, successors, assigns, heirs, personal representatives, devisees,
agents, stockholders, officers, directors, employees, and affiliates of any of
the above-mentioned parties (collectively "Indemnities") for, from and against
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any and all liabilities, damages, claims, suits, losses, causes of action,
liens, judgments and expenses (including court costs, attorney's fees, and costs
of investigation), of any nature, kind or description arising or claimed to
arise by reason of injury to or death of any person or damage to or loss of
property (i) occurring on, in, or about the Leased Premises, or (ii) by reason
of any other claim whatsoever of any person or party occasioned or alleged to be
occasioned in whole or in part by any act or omission on the part of Lessee or
any invitee, licensee, employee, director, officer, servant, guest, contractor,
subcontractor or sublessee of Lessee, or (iii) by any breach, violation, or
nonperformance of any covenant of Lessee under this Lease or a breach or
violation by Lessee of any court order or any law, regulation or ordinance of
any federal, state or local authority (collectively "Liabilities"), even if such
Liabilities arise from or are attributed to the concurrent or sole negligence of
any Indemnity. If any action or proceeding shall be brought by or against any
Indemnity in connection with any such Liabilities or claims, Lessee, on notice
from Lessor, shall defend such action or proceeding at Lessee's expense by or
through attorneys reasonably satisfactory to Lessor. The provisions of this
paragraph shall apply to all activities of Lessee with respect the Leased
Premises, whether occurring before or after the commencement date of the term
and before or after the expiration or termination of this Lease. Lessee's
obligations under this paragraph shall not be limited to damages, compensation
or benefits payable under insurance policies, worker's compensation acts,
disability benefit acts or other employee benefit acts.
15.05 Estoppel Letter. Lessee agrees to furnish Lessor's lender an estoppel
letter and such other documents as may be reasonably required of Lessor's lender
from time to time.
ARTICLE 16 LESSOR'S LIEN
------------------------
Article 16 Entire Section Deleted
ARTICLE 17. Miscellaneous
-------------------------
Notices and Addresses
17.01 All notices provided to be given under this agreement shall be given by
certified mail or registered mail, addressed to the proper party, at the
following address:
Lessor: Lessee:
Fast Fab Metal Buildings NGE Leasing Inc.
--------------------------- ---------------------------
X.X. Xxx 000 0000 Xxxxx Xxxxxx Xxxx 1260
--------------------------- ---------------------------
Xxxxxxxxxx, Xxxxx 00000 Xxxxxxx, Xxxxx 00000
--------------------------- ---------------------------
Attn: Xxxxx Xxxxxxxx
Parties Bound
17.02 This agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective heirs, executors, administrators, legal
representatives, successors, anal assigns where permitted by this agreement.
Law to Apply
17.03 This agreement shall be construed under and in accordance with the laws of
the State of, Texas and all obligations of the parties created hereunder are
performable in Wise County, Texas .
Legal Construction
17.04 In case any one or more of the provisions contained in this agreement
shall for any reason be held to be invalid, illegal, or unenforceable in any
respect, such invalidity, illegality, or unenforceability shall not affect any
other provision thereof and this agreement shall be construed as if such
invalid, illegal, or unenforceable provision had never been contained herein.
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Prior Agreements Superseded
17.05 This agreement constitutes the sole and only agreement of the parties
hereto and supersedes any prior understandings or written or oral agreements
between the parties respecting the within subject matter.
Amendment
17.06 No amendment, modification, or alteration of the terms hereof shall be
binding unless the same be in writing, dated subsequent to the date hereof and
duly executed by the parties hereto.
Rights and Remedies Cumulative
17.07 The rights and remedies provided by this lease agreement are cumulative
and the use of any one right or remedy by either party shall not preclude or
waive its right to use any or all other remedies. Said rights and remedies are
given in addition to any other rights the parties may have by law, statute,
ordinance, or otherwise.
Waiver of Default
17.08 No waiver by the parties hereto of any default or breach of any term,
condition, or covenant of this lease shall be deemed to be a waiver of any other
breach of the same or any other term, condition, or covenant contained herein.
Force Majeure
17.09 Neither Lessor nor Lessee shall be required to perform any term,
condition, or covenant in this lease so long as such performance is delayed or
prevented by force majeure, which shall mean acts of God, strikes, lockouts,
material or labor restrictions by any governmental authority, civil riot,
floods, and any other cause not reasonably within the control of the Lessor or
Lessee and which by the exercise of due diligence Lessor or Lessee is unable,
wholly or in part, to prevent or overcome.
Time of Essence
17.10 Time is essence of the agreement.
17.11 Mechanics and Other Liens. Except as hereinafter provided, Lessor reserves
the fee in the Leased Premises and specifically does not consent by virtue of
this Lease that such fee or the remainder interest of Lessor in the Leased
Premises or any improvements thereon shall be subject to any lien for labor or
materials furnished to Lessee in the repair or improvement of such property.
While the parties intend hereby; that the interest of Lessor hereunder cannot be
subjected to any lien on account of Lessee's use of, or actions with respect to,
the Leased Premises and that any future modifications of law to the contrary
would constitute an impairment of vested rights hereunder, nevertheless, should
a court of competent jurisdiction hold or should a valid statute be enacted
whereby any interest of Lessor in the Leased Premises or any improvements
thereon at any time hereafter shall be subjected to any such lien, then Lessee
shall, within thirty (30) days after written notice to Lessee of the existence
and perfection of such lien, cause such lien to be bonded or discharged and
otherwise shall save Lessor harmless on account thereof; provided, however, that
if Lessee desires in good faith to contest the validity or correctness of any
such lien, it may do so and Lessor shall cooperate to whatever extent shall be
necessary, provided only that Lessee must indemnify Lessor against any loss,
liability, damage or expense on account thereof.
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17.12 Subordination.
(a) This Lease and all rights of Lessee hereunder are and shall be subject
and subordinate to the lien of any and all mortgages, or consolidated
mortgages, which may now or hereafter affect the Leased Premises, or
any part thereof, and to any and all renewals, modifications,
consolidations, replacements and extensions of any such mortgages.
Such subordination is effective without any further act of Lessee.
(b) Lessee shall upon demand at any time or times execute, acknowledge and
deliver to Lessor, without expense to Lessor, any and all instruments
that may be necessary or proper to subordinate this Lease and all
rights hereunder to the lien of any such mortgage or mortgages and
each such renewal, modification, consolidation, replacement and
extension. Lessee agrees to furnish Lessor or Lessor's mortgagees upon
demand with estoppel certificates indicating that the Lease is in full
force and effect, that no defaults are then existing thereunder, the
date to which rental is paid under the Lease, the amount of security
deposits and prepaid rentals, if any, and such other information as
Lessor or its lender may reasonably request. Lessee further agrees to
execute such attainment agreements as the mortgagee or lender may
request. If Lessee shall fail at any time to execute, acknowledge and
deliver any such subordination instrument, estoppel certificate, or
attainment agreement, Lessor, in addition to any other remedies
available to it in consequence thereof, may execute, acknowledge and
deliver the same as the attorney-in-fact of Lessee and in Lessee's
name, place and stead, and Lessor hereby irrevocably makes,
constitutes and appoints Lessor, its successors and assigns, such
attorney-in-fact for that purpose.
17.13 Modification of Lease. This Lease contains the entire agreement between
the parties and shall not be amended or modified in any manner, except by
written instrument executed by the parties hereto or their respective successors
in interest. Any waiver or consent granted hereunder shall be effective only in
the specific instance and for the purpose for which given.
17.14 No Waiver of Rights. Neither any failure nor any delay on the part of any
party exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall a single or partial exercise thereof preclude any
other or further exercise or the exercise of any other right, power or
privilege.
17.15 Memorandum of Lease. This Lease shall not be recorded, except that if
either party requests the other party to do so, the parties shall execute a
memorandum of lease in form and manner sufficient to enable it to be recorded in
the governmental office in which there would be recorded a deed covering the
Leased Premises in accordance with the law of the jurisdiction in which the
Leased Premises are located.
17.16 Legal Expenses. In the event of the bringing of any action by either party
hereto against the other hereon or hereunder, or by reason of the breach of any
term, covenant or condition on the part of the other party, or arising out of
this Lease, the party in whose favor final judgment shall be entered shall be
entitled to have and recover from the other party reasonable attorney's fees to
be fixed by the court which shall have rendered such judgment.
17.17 Successors. The terms, covenants and conditions herein contained shall
inure to the benefit of the heirs, administrators, executors, successors and
assigns of each of the parties hereto.
17.18 Common Access and Parking Easements. The Lessor hereby reserves unto
itself, its successors and assigns, an easement of ingress and egress for
pedestrian and vehicular traffic in, to, over, across and through the driveways,
entrances, exits and parking areas situated on the Leased Premises. Lessee
hereby agrees that it will keep in good repair during the term of the Lease,
free from rubbish, obstacles, barricades and other obstructions all such
driveways, entrances, exits and parking areas located on the Leased Premises.
Lessor and Lessee otherwise hereby acknowledge and agree that during the term of
this Lease, all entrances and exits, driveways and parking areas from time to
time located within the entire property owned by Lessor, may be used in common
by Lessor and Lessee and their respective patrons, guests, licensees and
invitees.
17.19 Sign Reservation. This Lease and the interests in the Premises transferred
hereby is subject to the reservation by Lessor of an easement for signage, the
location of which will be mutually agreed to by both parties. In the placement
and location of its signage advertising its business, Lessor covenants that it
will not obstruct vehicular circulation nor will the placement of signage
obstruct, interfere or block the signage of Lessee. The parties agree to execute
such additional documentation as may reasonably be required in furtherance of
this Section 11.11. Lessee can place signs on Hwy 101 and on building.
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17.20 Parking. Lessor shall not alter the common area in any way that would
reduce the number of parking spaces at the Leased Premises to less than the
currently existing number of parking spaces.
IN WITNESS WHEREOF, the undersigned Lessor and Lessee hereto execute this
agreement as of the day and year first above written.
LESSEE: LESSOR:
NGE Leasing Inc. Wise Commercial Properties
0000 Xxxxx Xxxxxx Xxxx 0000 Xxxxxx X. Xxxxx Xx.
Xxxxxxx, Xxxxx 00000 General Partner
Attn: Xxxxx Xxxxxxxx Xxxxxx X. Xxxxx Xx.
General Partner
By: By:
-------------------- --------------------
Name: Name:
------------------ ------------------
Title: Title:
----------------- -----------------
Name:
------------------
Title:
-----------------
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EXHIBIT A
Property Description
[please provide a complete legal description of the property]
