1
EXHIBIT 10.10
LEASE AGREEMENT
---------------------
THIS LEASE AGREEMENT (hereinafter sometimes referred to as this "Lease")
is made and entered into as of the 5 day of May, 1998, by and between WINCO,
LTD., a Georgia limited partnership (herein sometimes referred to as to
"Landlord") and Xxxxxxxxxxx Automotive Group, Inc., d/b/a Xxxxxxxxxxx Nissan
(herein sometimes referred to as "Tenant").
W I T N E S S E T H T H A T:
For valuable consideration, Landlord and Tenant, intending to be legally
bound, hereby agree with each other as follows:
ARTICLE I - DEFINITIONS AND FUNDAMENTAL PROVISIONS
The following terms shall have the meanings set forth below when used in
this Lease, except as may otherwise be specifically provided:
1.1 Addresses:
Landlord: 0000 Xxxx Xxxxxxx, Xxxxxx, Xxxxxxx 00000
Tenant: 0000 Xxxx Xxxxxxx, Xxxxxx, Xxxxxxx 00000
or such other address or addresses as a party may designate by written notice
to the other party.
1.2 Property: That certain tract or parcel of land located in LL 206 of
the 6th District of Gwinnett County, Georgia, which is more particularly
described and/or depicted on Exhibit A, attached hereto and by this reference
made a part hereof (the "Property"), the street address being 0000 Xxxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxx, 00000.
1.3 Premises: The Property and the improvements now or hereafter thereon,
which Premises, include an automobile dealership presently comprised of two
(2) main structures (the "Buildings").
1.4 Lease Year: Each Lease Year shall be a period of twelve (12)
consecutive calendar months, beginning on the expiration of the prior Lease
Year. The first Lease Year shall commence May 1, 1998 (the "Commencement
Date"), and end at the end of the twelfth (12th) full calendar month
thereafter. At the request of either party, the parties shall execute a
stipulation stating the Commencement Date, the expiration of the first Lease
Year and of the Initial Term after Landlord has delivered the Premises to
Tenant.
2
1.5 Basic Rent: Tenant agrees to pay as "Basic Rent" the amounts, as
adjusted, as hereinafter described, in strict accordance with the terms and
provisions of Article III hereof, as follows:
Monthly Basic Rent for the period from the Commencement Date through
the Tenth (10th) Lease Year shall be as follows:
May 1, 1998, through October 31, 1998 - $17,500 per month
November 1, 1998 through April 30, 1999 - $17,500 per month
May 1, 1999, through April 30, 2000 - $20,000 per month
May 1, 2000, through April 30, 2001 - $21,500 per month
May 1, 2001, through April 30, 2002 - $23,000 per month
May 1, 2002, through April 30, 2003 - $24,500 per month
May 1, 2003, through April 30, 2004 - $27,000 per month
May 1, 2004, through April 30, 2005 - $27,810 per month
May 1, 2005, through April 30, 2006 - $28,644 per month
May 1, 2006, through April 30, 2007 - $29,503 per month
May 1, 2007, through April 30, 2008 - $30,388 per month
1.6 Permitted Use. The Premises shall be used for the operation of an
automobile dealership, selling primarily new automobiles, and initially
operating the following franchise: Nissan, together, at Tenant's election, with
such operations and services as are ancillary and integrally related to the
operation of an automobile dealership (for example, car leasing operations
and/or automobile repair shop), provided Tenant shall, at all times, continue
as its primary business at the Premises a new car dealership, and for no other
purpose, whatsoever.
1.7 Rent. "Rent" shall mean and include Basic Rent and all other amounts
and charges payable by Tenant under any provision of this Lease. Sums other
than Basic Rent that are designated as "Rent" or "Additional Rent" (or any
similar term indicating rent or rental) are so designated solely for the
purpose of enabling Landlord to enforce its rights hereunder, and Landlord
shall have the same remedies for Tenant's failure to pay same as for
non-payment of Basic Rent. Such sums shall not be deemed rent for purposes of
computing taxes or for governmental regulations thereon.
1.8. Term. Ten (10) Lease Years (being sometimes herein referred to as the
"Initial Term") to commence on the Commencement Date.
1.9 Memorandum of Lease. Tenant shall not record or permit the recording
of this Lease without Landlord's written consent. At Landlord's request, Tenant
shall execute and deliver a written statement in recordable form, identifying
the parties hereto and the Property, specifying the Commencement Date and
termination date of the Lease Term and the Permitted Use, and incorporating
this Lease by reference.
1.10 Net Lease. This Lease is to be absolutely net to Landlord. Tenant
shall pay for all expenses, costs, impositions, taxes and other charges imposed
upon or affecting the Premises during
-2-
3
the Term, and Landlord shall have no obligation to pay for any matter affecting
the Premises during the Term, except as may be explicitly set forth herein.
ARTICLE II -- DEMISED PREMISES
2.1 Demise of Premises. Landlord hereby leases and demises to Tenant for
the Term and Permitted Use specified herein, and Tenant rents from Landlord the
Premises, subject to the terms and conditions herein contained, and all
encumbrances, easements, restrictions, mortgages, zoning laws and governmental
or other regulations affecting the Premises (such other encumbrances and other
matters sometimes collectively referred to herein as the "Encumbrances").
2.2 Quiet Enjoyment. Tenant, upon timely paying the Rent herein, reserved
and performing and observing all of the other terms, covenants and conditions of
this Lease, shall peaceably and quietly have, hold and enjoy the Property during
the Term, without interference by Landlord, subject to the terms of this Lease
and the Encumbrances.
ARTICLE III -- RENT AND OTHER CHARGES
3.1 Payment of Rent. During the Term, Tenant covenants and agrees to pay to
Landlord, in advance, at the place designated in Section 1.1 hereof, without
demand, deduction or set-off, all Rent as defined in Section 1.7 hereof.
3.2 Payment of Basic Rent. On the Commencement Date, and thereafter,
monthly Basic Rent shall be due and payable on or before the first (1st) day of
each and every calendar month during the Term, in advance, without demand,
deduction or set-off as set forth in Section 1.5 hereinabove.
3.3 Past Due Rent and Additional Rent. If Tenant shall fail to pay, when
the same is due and payable, any Rent or any Additional Rent, or amounts or
charges of any character whatsoever owed to Landlord, such unpaid amounts shall
bear interest from the due date thereof to the date of payment at the rate which
is the lesser of (i) eighteen percent (18%) per annum, or (ii) the maximum
interest rate permitted by law (the "Default Rate").
3.4 Payments on Behalf of Tenant. In case of any default by Tenant in the
payment of any amounts herein provided to be paid by Tenant, including, without
limitation, the procuring of insurance as hereinafter provided for, or in any
other payment required to be made by Tenant hereunder, Landlord, on behalf of
Tenant, may make such payment or payments, or procure any such insurance, and
Tenant covenants to reimburse and pay Landlord any amount paid or expended
immediately upon demand, with interest from the date of disbursement by Landlord
at the Default Rate.
3.5 Utilities. Tenant shall make application for, obtain, pay for, and be
solely responsible for all utilities required, used or consumed in the Premises,
including, but not limited to, gas, water (including water for domestic uses and
for fire protection), telephone, electricity, sewer service, garbage collection
services, or a similar service (herein sometimes collectively referred to as the
-3-
4
"Utility Services"). In the event that any charge or assessment for any Utility
Service supplied to the Premises, that has or could become a lien on the
Premises or any portion thereof or interest therein, is not paid by Tenant to
the utility supplier when due, then, ten (10) days after written notice to
Tenant, Landlord may, but shall not be required to, pay such charge for and on
behalf of Tenant, with any such amount paid by Landlord being repaid by Tenant
to Landlord with interest at the Default Rate, as Additional Rent, within ten
(10) days after demand by Landlord, Landlord shall have absolutely no obligation
with respect to any Utility Service to the Premises and shall not be liable for
any interruptions or curtailment in Utility Services whatsoever.
3.6 Taxes. Tenant shall be responsible for the timely payment of all
taxes, public charges and assessments, of whatsoever nature, directly or
indirectly assessed or imposed upon the land, buildings, equipment and
improvements constituting the Premises and the rents therefrom, including, but
not limited to, all real property taxes, rates, duties and assessments, local
improvement taxes, import charges or levies, whether general or special, that
are levied, charged or assessed against the Premises by any lawful taxing
authority, whether federal, state, county, municipal, school or otherwise (other
than income, inheritance and franchise taxes thereon) (the "Taxes"). Taxes for
any partial tax period shall be prorated. If Landlord initially pays the Taxes,
Tenant shall reimburse Landlord thereof upon demand.
Tenant shall also promptly pay, when due, all taxes on its trade fixtures
and other personal property in or on the Premises.
ARTICLE IV -- USE OF PREMISES
4.1 Tenant's Use. Tenant shall use the Premises solely for the Permitted
Use specified in Section 1.6, and for no other purpose whatsoever. Tenant shall
not vacate or abandon the Premises during the Term.
4.2 Legal Operation of Premises. Tenant shall not use, or suffer or
permit the Premises, or any part thereof, to be used for any purpose or use in
violation of any law, ordinance or regulation of any governmental authority, or
in any manner that will constitute a nuisance or an annoyance, or for any
hazardous purpose. Nothing contained in this Section 4.2 shall be construed to
interfere with Tenant's right to operate in the Premises for the uses and in the
manner set forth in Section 1.6 hereof, so long as they are lawful. In the
event, at any time during the Term of this Lease, any addition, alteration,
change or repair or other work of any nature, structural or otherwise, shall be
required or ordered or become necessary or account of any law, ordinance or
regulation of any governmental authority now in effect or hereafter adopted,
passed or promulgated, or on account of any other reason with respect to the
Premises, the entire expense thereof, regardless of when the same shall be
incurred or become due, shall be the liability of Tenant and in no event shall
Landlord be called upon to contribute thereto or do or pay for any work of any
nature whatsoever on or relating to the Premises. Tenant takes the Property
subject to all zoning regulations and ordinances now or hereafter in force.
-4-
5
4.3 Alterations to Premises. Except as described in Section 5.3
hereinbelow, Tenant shall not alter the exterior of the Premises, or make
interior structural changes or make any other changes or alterations to the
Premises without first obtaining Landlord's written approval for such
alterations, which approval shall not be unreasonably withheld or delayed. All
alterations shall remain upon the Premises and shall become Landlord's property
upon the expiration or other termination of this Lease; provided, however, that
Landlord may require any alteration or improvement made by Tenant without
Landlord's written consent to be removed by Tenant by written notice thereof
given to Tenant no later than sixty (60) days after the expiration or earlier
termination of the Term. There shall be no signs or any other equipment on the
roof of any of the Buildings or any other structure now or hereafter existing on
the Property. Notwithstanding the foregoing, Tenant shall be permitted without
the requirement of Landlord's prior consent, to make interior, cosmetic,
non-structural alterations to the Premises; provided that: (i) the value and
structural integrity of the Premises are not decreased or diminished thereby;
(ii) all such work is expeditiously completed in a good and workmanlike fashion
and in compliance with all applicable laws, ordinances and regulations and in
conformity with all provisions of this Lease; and (iii) Tenant obtains lien
waivers consistent with the provisions of Section 4.4 hereof.
4.4 Liens. Tenant will not create or permit to be created or to remain, and
will discharge, any lien (including, but not limited to, the liens of mechanics,
laborers or materialmen for work or materials alleged to be done or furnished in
connection with the Premises), encumbrance or other charge upon the Premises or
any part thereof. Landlord reserves the right to enter the Premises to post and
keep posted notice of non-responsibility for any such lien.
ARTICLE V -- REPAIRS AND MAINTENANCE
5.1 No Maintenance or Repair by Landlord. Landlord shall have no obligation
to improve, alter, replace, maintain and/or repair the Premises, or any part
thereof. Landlord may inspect the Premises as all reasonable times to determine
whether Tenant has fulfilled its maintenance and repair obligations under this
Lease and to otherwise inspect or exhibit the Premises; provided, however, that
Landlord shall never be obligated to inspect the Premises for any reason.
5.2 Maintenance, Repair and Replacement Obligations of Tenant. Tenant
shall, at Tenant's expense, at all times keep and maintain the entire Premises
in good repair and condition, including without limitation, the diligent and
prompt repair of the roof and all exterior supporting walls, foundations, HVAC,
plumbing, electrical and other systems, rain gutters and spouting and all
esthetic aspects of the Premises and shall also keep the non-structural portions
of the Premises (specifically including the storefront, windows and automatic or
other doors of the Premises) in good order, condition, and repair, clean,
sanitary and a safe, including the replacement of equipment, fixtures and all
broken glass (with glass of the same size and quality). Tenant shall also,
during the Term hereof, maintain in good condition and repair the non-building
areas of the Property, including the sidewalks, driveways, landscaped areas and
parking areas, and including patching, striping, cleaning, sweeping and other
maintenance. In the event Tenant fails to perform any of it obligations as
required hereunder, Landlord may (but shall not be required to) perform and
satisfy same, and Tenant hereby agrees to reimburse Landlord, as Additional
Rent, for the cost thereof, together with interest at the
-5-
6
Default Rate, promptly upon demand. The parties agree that it shall be Tenant's
sole responsibility at all times during the Term of this Lease to maintain the
Premises in structurally sound, leak-free condition so that the Premises shall
be maintained at all times as if operations therein were to continue beyond the
expiration of the Term, and so that all normal maintenance and repair during the
Term shall be completed when the Premises are surrendered to Landlord.
5.3 Improvements. Landlord and Tenant acknowledge that Tenant may make
certain improvements to the Buildings, from time to time ("Tenant's
Improvements"), as provided or required pursuant to the terms of this Lease.
Tenant's Improvements shall be subject to all of the terms of this Lease and
must first be approved by Landlord in writing, which approval shall not be
unreasonably withheld or delayed. All such Tenant's Improvements which are
fixtures shall become the property of Landlord upon the installation thereof.
5.4 As-Is Lease. Tenant acknowledges that Tenant is leasing the Premises "as
is" without any warranty or representation and that Landlord has not made, and
is not hereby making, any warranties or representations pertaining to the
physical condition of the Premises, any part thereof or any improvements
thereon.
ARTICLES VI -- ACCESS TO PREMISES
Tenant agrees that Landlord, its agents, employees or servants or any
person authorized by Landlord may enter the Premises to inspect the condition
of same, to cure defaults of Tenant as provided for herein, and to exhibit the
same to prospective tenants, purchasers, mortgagees or others interested in the
Premises. Such entry, cure or exhibition shall not constitute an eviction of
Tenant, in whole or in part, Landlord agreeing to employ its reasonable efforts
in attempting to minimize any interruption to the business operations of Tenant
resulting from Landlord's (or its designated representatives') entry to the
Premises. Nothing herein contained, however, shall be deemed or construed to
impose upon Landlord any obligation or liability, whatsoever, for the
inspection, care, supervision, repair, improvement, addition, change or
alteration of the Premises.
ARTICLE VII -- INSURANCE AND INDEMNIFICATION
7.1 Tenant Liability Insurance. Tenant shall maintain, at its sole
expense, during the Term hereof, General Commercial Liability or General Garage
Liability insurance, insuring both Tenant and Landlord covering the Premises
with single limit coverage of at least One Million Dollars ($1,000,000) per
occurrence and not less than Two Million Dollars ($2,000,000) in the aggregate
in companies licensed and in good standing in the State of Georgia in the joint
names of Landlord and Tenant. Tenant shall further maintain at its sole expense
a commercial umbrella policy with single limit coverage of a least Five Million
Dollars ($5,000,000) per occurrence and not less than Five Million Dollars
($5,000,000) in the aggregate in companies licensed and in good standing in the
State of Georgia in the joint names of Landlord and Tenant. Tenant shall keep
in force all-risk (Special Form) coverage insurance for the full replacement
value of all of Tenant's personal property within the Premises and on the
Property, including, but not limited to, fixtures, inventory, trade fixtures,
furnishings and other personal property. In addition, Tenant shall keep in
force workers
-6-
7
compensation or similar insurance to the extent required by law. Finally, Tenant
shall maintain, at its sole cost and expense, Special Form ("all-risk") property
insurance covering the Buildings for the full replacement cost thereof
(excluding footings and foundations), providing protection against perils
included in the Special Form ("all-risk") insurance policy. All insurance
required under this Section 7.1 shall be written by companies rated A or better
in the most current edition of Best's Insurance Report. Tenant will cause such
insurance policies to name Landlord and its agents (and, at Landlord's election,
any lender whose loan is secured by the Premises (a "mortgagee")) as a named
insured thereunder with respect to liability policies and to be written so as to
provide that the insurer waives all right of recovery by way of subrogation
against Landlord (and, at Landlord's election, any mortgagees) in connection
with any loss or damage covered by the all-risk (Special Form) policy in
accordance with the provisions of Section 7.2 hereof. Tenant shall deliver said
policies of liability, workers compensation and all-risk insurance or
certificates thereof to Landlord at or prior to its execution of this Lease, and
thereafter from time to time at the reasonable request of Landlord. Should
Tenant fail to effect the insurance called for in this Lease, Landlord may, but
shall not be obligated to, procure said insurance and pay the requisite
premiums, in which event, Tenant shall promptly pay all sums so expended by
Landlord as Additional Rent following invoice. Each insurer under the policies
required hereunder shall agree by endorsement on the policy issued by it, or by
independent instrument furnished to Landlord that it will give Landlord at least
thirty (30) days prior written notice before the policy or policies in question
shall be altered or canceled. Tenant's property insurance policy shall insure
Landlord and any mortgagee, as their interests may appear.
7.2 Waiver of Subrogation. Tenant hereby releases Landlord and anyone
claiming through or under Landlord by way of subrogation from any and all
liability for any loss of or damage to property, regardless of whether caused by
the negligence or fault of Landlord, to the extent same is required to be
insured pursuant to the requirements of this Lease. In addition, Tenant shall
cause each such insurance policy carried by it insuring the Buildings or
Tenant's personal property therein (and including the insurance coverages
required in Section 7.1 hereinabove) to be written to provide that the insurer
waives all rights of recovery by way of subrogation against Landlord in
connection with any loss or damage covered by the policy.
7.3 Indemnification and Release. Tenant hereby agrees to indemnify,
protect, defend and hold Landlord harmless from any and all claims, damages,
liabilities or expenses (including, without limitation, attorney's fees and
other costs of legal representation) (collectively "Claims") arising out of (i)
any and all claims by third parties arising from any breach or default in the
performance of any obligation of Tenant hereunder and (ii) any act, omission or
negligence of Tenant, its agents or employees on or about the Premises or
otherwise in connection with this Lease. Tenant further releases Landlord from
liability for any damages sustained by Tenant, or any other person claiming by,
through or under Tenant, due to the Premises or any part thereof or any
appurtenances thereto being or becoming out of repair or due to the happening of
any accident, including, but not limited to, any damage caused by water, snow,
ice, windstorm, tornado, gas, steam, electrical wiring, sprinkler system,
plumbing, heating and air conditioning apparatus. Notwithstanding the foregoing,
Tenant's indemnification pursuant to this Section 7.3 shall not apply to any
Claims arising solely as a result of the willful acts or negligence of Landlord,
or its agents, representatives, invitees,
-7-
8
employees or contractors. Landlord shall not be liable for any damage to, or
loss of, Tenant's personal property, inventory, fixtures or improvements from
any cause whatsoever.
ARTICLE VIII -- CASUALTY AND CONDEMNATION
8.1 Fire, Explosion or Other Casualty. In the event the Premises are
endangered by fire, explosion or any other casualty, except as otherwise
provided herein, the damage shall be repaired by Tenant, said repairs to be
substantially completed within two hundred seventy (270) days after the
casualty causing damage has occurred, subject to force majeure events beyond
Tenant's reasonable control.
In the event the Premises shall be damaged or destroyed to the extent of
seventy-five percent (75%) or more of the total square footage of all Buildings
and other improvements on the Premises (hereinafter, a "Casualty"), and such
Casualty shall occur after the first five (5) Lease Years of the Term of the
Lease, then and in such event, Tenant may elect by written notice to Landlord
delivered within thirty (30) days after such a Casualty either to repair or
rebuild the Premises, as aforesaid, or to terminate this Lease, effective as of
the date Tenant's notice is delivered to Landlord. If Tenant elects to
terminate the Lease pursuant to this Section 8.1, then Tenant shall direct its
insurance company(s) to deliver directly to Landlord all insurance proceeds to
be paid for or in connection with said Casualty; provided, in no event shall
the amount of such insurance proceeds payable to Landlord be less than the full
replacement value of all such improvements which have been so damaged or
destroyed, as reasonably determined by Landlord's insurance adjuster. If the
insurance proceeds are less than the full replacement value as aforesaid,
Tenant shall pay such deficiency to Landlord upon demand. If Tenant fails to
deliver notice of its election to Landlord within the thirty (30) day period
referenced above, Tenant shall be deemed to have elected to repair or rebuild
the Premises and the Lease shall remain in full force and effect.
If this Lease is not terminated pursuant to the preceding paragraph, then
Tenant shall restore and repair the Buildings and other improvements in an
expeditious manner. If Tenant purchases, at its sole option, rent insurance to
compensate Landlord for any lost rents as a result of damage or destruction to
the Premises, then Basic Rent (and other Rent) shall xxxxx during any period
following damage to the Premises in a fair and equitable fashion according to
the proportion of the Premises that cannot reasonably be utilized by Tenant,
provided that the amount of such abatement shall not exceed the rent insurance
proceeds actually received by Landlord with respect thereto. Notwithstanding
the provisions of this Section 8.1, Tenant shall be the owner of its trade
fixtures and shall be entitled to any insurance proceeds attributable to said
trade fixtures.
8.2 Condemnation. If the whole of the Premises, or so much thereof as to
render the balance unusable by Tenant, shall be taken under power of eminent
domain, or otherwise transferred in lieu thereof, this Lease shall
automatically terminate as of the date possession is taken by the condemning
authority. No award for any total or partial taking of any real property
interest in or to the Premises shall be apportioned, and Tenant hereby
unconditionally assigns to Landlord any award which may be made for real
property interests in such taking or condemnation. In the event of a partial
taking,
-8-
9
which does not result in the termination of this Lease, Basic Rent shall be
apportioned according to the part of the Buildings remaining usable by Tenant.
8.3 Condemnation Award. All compensation awarded or paid for any taking or
acquiring under the power or threat of eminent domain, whether for the whole or
part of the Premises, shall be the property of Landlord, and Tenant hereby
assigns to Landlord all of Tenant's right, title and interest in and to any such
award. Notwithstanding the foregoing, Tenant shall be entitled to claim, prove
and receive in the condemnation proceeding or by separate action, such awards as
may be allowed for loss of lease, moving expense, fixtures and other equipment
installed by it, but only if such awards shall be made by the condemnation court
in addition to the award made by it for the land and the Buildings or part
thereof so taken.
ARTICLE IX -- ASSIGNMENT AND SUBLETTING
9.1 Assignment and Subletting. Tenant's interest in the Premises shall be
limited to the use and occupancy thereof in accordance with the provisions
hereof and shall be non-transferable without Landlord's prior written consent,
which consent shall not be unreasonably withheld conditioned or delayed. Any
attempts by Tenant to assign its interest in the Lease, or to sublet the
Premises in whole or in part, or to sell, assign, lien, encumber or in any
manner transfer this Lease or any interest therein, without Landlord's prior
written consent shall constitute a default hereunder, as shall any attempt by
Tenant to assign or delegate the management or to permit the use or occupancy of
the Property or the Premises or any part thereof by anyone other than Tenant,
Landlord and Tenant acknowledge and agree that the foregoing provisions have
been freely negotiated by the parties hereto and that Landlord would not have
entered into this Lease without Tenant's consent to the terms of this Section
9.1. Any attempt by Tenant to assign this Lease or to sublet all or any portion
of the Premises, to encumber same, or to in any manner transfer, convey or
assign Tenant's interest therein without Landlord's prior written consent shall
be void ab initio.
Notwithstanding anything contained herein to the contrary, Tenant may,
without the prior consent of Landlord, (i) assign this Lease or sublet the
Premises to any wholly-owned subsidiary of Tenant, to the parent corporation of
Tenant, or to a wholly-owned subsidiary of the parent corporation of Tenant, or
(ii) transfer its capital stock to the parent corporation of Tenant, or to a
wholly-owned subsidiary of Tenant or of Tenant's parent corporation; provided
that, in the case of any such transfer, all of the assets held by Tenant prior
to such transfer remain or become assets of the continuing corporation. If
Tenant survives as an entity after such assignment or sublease, Tenant shall
remain fully and primarily liable for performance of all obligations of the
tenant under the Lease and shall not be released as a result thereof.
9.2 Change of Control. In furtherance of the provisions of Section 9.1
hereof, if Tenant is a partnership, limited liability company, corporation or
banking association and if the person or persons who own a majority of its
voting shares or interests at the time of the execution hereof cease to own a
majority of such shares or interests at any time hereafter (except as a result
of transfers by gift, bequest or inheritance by or among immediate family
members), Tenant shall so notify Landlord. In the event of such change of
ownership, regardless of whether Tenant has notified Landlord thereof,
-9-
10
Landlord may terminate this Lease by notice to Tenant effective sixty (60) day
from the date of such notice from Tenant, or the date on which Landlord first
has knowledge of such transfer, whichever shall first occur.
ARTICLE X -- SUCCESSION TO LANDLORD'S INTEREST
10.1 Attornment. Tenant shall attorn and be bound to any of Landlord's
successors under all the terms, covenants and conditions of this Lease for the
balance of the remaining term.
10.2 Subordination.
(a) This Lease shall be subordinate to the lien of any mortgage or
security deed or the lien resulting from any other method of financing or
refinancing now or hereafter in force against the Premises or any portion
thereof, and to any and all advances to be made under such security
instruments, and all renewals, modifications, extensions, consolidations
and replacements thereof. The aforesaid provisions shall be self-operative
and no further instrument of subordination shall be required to evidence
such subordination. Tenant covenants and agrees to execute and deliver,
upon demand, such further instrument or instruments subordinating this
Lease on the foregoing basis to the lien of any such security instruments
as shall be desired by Landlord and any mortgages or proposed mortgagees.
(b) Notwithstanding anything to the contrary set forth in subsection
(a) above, any mortgagee may at any time subordinate its mortgage to this
Lease, without Tenant's consent, by execution of a written document
subordinating such mortgage to this Lease to the extent set forth therein
and thereupon this Lease shall be deemed prior to such mortgage to the
extent set forth in such written document, without regard to their
respective dates of execution, delivery and/or recording. In that event, to
the extent set forth in such written document, such mortgagee shall have
the same rights with respect to this Lease as though this Lease had been
executed and a memorandum thereof recorded prior to the execution, delivery
and recording of the mortgage and as though this Lease had been assigned to
such mortgagee.
10.3 Estoppel Certificate. Within ten (10) days after request therefor by
Landlord, or in the event that upon any sale, assignment or hypothecation of the
Premises and/or the land thereunder by Landlord an estoppel certificate shall be
required from Tenant, Tenant agrees to deliver in recordable form, a certificate
to any proposed mortgagee or purchaser, or to Landlord, certifying that this
Lease is unmodified and in full force and effect (or, if there have been
modifications, that the same is in full force and effect as modified and stating
the modifications), that there are no defenses or offsets thereto (or stating
those claimed by Tenant) and the dates to which Basic Rent and other charges
have been paid, and such other matters as Landlord may reasonably require.
ARTICLE XI -- DEFAULT, REMEDIES AND BANKRUPTCY
11.1 Default of Tenant. In the event that Tenant (a) fails to pay all or
any portion of any sum due from Tenant hereunder or pursuant to any exhibit
hereto when due and such failure to pay
-10-
11
continues for more than five (5) business days after receipt of written notice
from Landlord (provided that such five (5) day grace period shall not be
available more than three (3) times in any twelve (12) month period); (b) fails
to perform any other terms, covenants and conditions hereof, or is otherwise in
breach of any of Tenant's obligations hereunder or commits any other act or
omission in violation of this lease and such failure to perform or violation
continues for more than thirty (30) days after receipt of written notice from
Landlord (provided such thirty (30) day grace period shall not be available more
than three (3) times in any twelve (12) month period); (c) becomes bankrupt,
insolvent or files any debtor proceeding takes or has taken against Tenant any
petition of bankruptcy; takes action or has action taken against Tenant for the
appointment of a receiver for all or a portion of Tenant's assets, files a
petition for a corporate reorganization; makes an assignment for the benefit of
creditors, or if in any other manner Tenant's interest hereunder shall pass to
another by operation of law (any or all of the occurrences in this subsection
11.1(c) shall be deemed a default on account of bankruptcy for the purposes
hereof and such default on account of bankruptcy shall apply to and include any
guarantor of this Lease); or (d) commits waste to the Premises or removes any
betterments or improvements thereof; then Tenant shall be in default hereunder
and Landlord may, at its option and without further notice to Tenant, terminate
Tenant's right to possession of the Premises and without terminating this Lease
re-enter and resume possession of the Premises and/or declare this Lease
terminated, and may, thereupon, in either event remove all persons and property
from the Premises with or without resort to process of any court, either by
force or otherwise Notwithstanding such re-entry by Landlord, Tenant hereby
indemnifies, protects, defends and holds Landlord harmless from any and all loss
or damage which Tenant may incur by reason of the termination of this Lease
and/or Tenant's right to possession hereunder. In no event shall Landlord's
termination of this Lease and/or Tenant's right of possession of the Premises
abrogate Tenant's agreement to pay Rent and additional charges due hereunder for
the full term hereof. Following re-entry of the Premises by Landlord, Tenant
shall promptly pay all arrearages then due and overdue and shall continue to pay
all such Rent and additional charges as same become due under the terms of this
Lease, together with all other expenses incurred by Landlord in regaining
possession until such time, if any, as Landlord relets same and the Premises are
occupied by such successor, it being understood that Landlord shall have no
obligation to mitigate Tenant's damages by reletting the Premises. Upon
reletting, sums received from such new lessee by Landlord shall be applied first
to payment of costs incident to reletting; any excess shall then be applied to
any indebtedness to Landlord from Tenant other than for Basic Rent; and any
excess shall then be applied to the payment of Basic Rent due and unpaid. The
balance, if any, shall be applied against the deficiency between all amounts
received hereunder and sums to be received by Landlord on reletting, which
deficiency Tenant shall pay to Landlord in full, within five (5) days of notice
of same from Landlord. Tenant shall have no right to any proceeds for reletting
that remain following application of same in the manner set forth herein.
11.2 Rights and Remedies. The various rights and remedies herein granted
to Landlord shall be cumulative and in addition to any others Landlord may be
entitled to by law or in equity, and the exercise of one or more rights or
remedies shall not impair Landlord's right to exercise any other right or
remedy. All such rights and remedies may be exercised and enforced concurrently
or consecutively, and whenever and as often as Landlord shall deem desirable.
The failure of Landlord to insist upon strict performance by Tenant of any of
the covenants, conditions and agreements of this Lease shall not be deemed a
waiver of any of said rights and remedies concerning any subsequent or
-11-
12
continuing breach or default by Tenant of any of the covenants, conditions, or
agreements of this Lease. No surrender of the Premises shall be effected by
Landlord's acceptance of Rent or by any other means whatsoever unless the same
be evidenced by Landlord's written acceptance of such as a surrender. In all
events, Landlord shall have the right upon notice to Tenant to cure any breach
by Tenant at Tenant's sole cost and expense, and Tenant shall reimburse
Landlord for such expense upon demand. Tenant shall reimburse Landlord for
attorney's fees and other expenses incurred by Landlord under this Article XI.
11.3 Landlord's Default. If Tenant alleges a breach or default by Landlord
hereunder, Tenant shall provide Landlord (and any mortgagee of Landlord of whom
Tenant has notice) with written notice thereof and provide thirty (30) days
thereafter for Landlord or its mortgagee to cure same prior to exercising any
right or remedy Tenant may have for said breach or default.
11.4 Bankruptcy. If Landlord shall not be permitted to terminate this
Lease as hereinabove provided because of the provisions of Title 11 of the
United States Code relating to Bankruptcy, as amended ("Bankruptcy Code"), then
Tenant as a debtor in possession or any trustee for Tenant agrees promptly,
within no more than fifteen (15) days upon request by Landlord to the
Bankruptcy Court, to assume or reject this Lease and Tenant on behalf of
itself, and any trustee agrees not to seek or request any extension or
adjournment of any application to assume or reject this Lease by Landlord with
such Court. In such event, Tenant or any trustee for Tenant may only assume
this Lease if (a) it cures or provides adequate assurance that the trustees
will promptly cure any default hereunder, (b) it compensates or provides
adequate assurance that Tenant will promptly compensate Landlord for any actual
pecuniary loss to Landlord resulting from Tenant's defaults, and (c) it
provides adequate assurance of performance during the fully stated Term hereof
of all of the terms, covenants and provisions of this Lease to be performed by
Tenant. In no event after the assumption of this Lease shall any then-existing
default remain uncured for a period in excess of the earlier of ten (10) days
or the time period set forth herein. Adequate assurance of performance of this
Lease as set forth hereinabove shall include, without limitation, adequate
assurance (1) of the source of Rent reserved hereunder and (2) the assumption
of this Lease will not breach any provision hereunder.
ARTICLE XII -- SURRENDER OF PREMISES
12.1 Surrender of Premises. At the expiration or earlier termination of
this Lease, Tenant shall surrender the Premises to Landlord broom clean and in
good condition, and in a condition which complies with all applicable laws,
reasonable wear and tear and insured casualty (for which Landlord receives the
proceeds) excepted. Tenant shall promptly remove Tenant's sign, personal
property and trade fixtures upon such expiration or termination and repair any
damage or disturbance to the Premises caused by the removal of any furniture,
trade fixtures or other personal property placed in the Premises. Tenant's
failure to remove all or part of Tenant's sign, personal property and trade
fixtures within ten (10) days after such expiration or termination shall be
deemed an abandonment to Landlord of such sign, personal property and trade
fixtures and, if Landlord elects to remove all or any part of said same, such
removal, including the cost of repairing any damage to the Premises caused by
or resulting from such removal, shall be paid by Tenant.
-12-
13
12.2 Holding Over. Should Tenant, with Landlord's written consent, hold
over at the end of the Term of the Lease, Tenant shall become a tenant-at-will
and any such holding over shall not constitute an extension of this Lease.
During such holding over, Tenant shall pay Rent and other charges at the
highest monthly rate provided for herein, plus an additional fifty percent (50%)
of the Basic Rent in effect at the expiration of the Term hereof. If Tenant
holds over at the end of the Term of the Lease without Landlord's written
consent, Tenant shall be a tenant-at-sufferance.
ARTICLE XIII - MISCELLANEOUS
13.1 Notices. Notices and demands required or permitted to be given
hereunder may be given by personal delivery to the addresses designated in
Section 1.1 hereinabove (including courier and expedited delivery services) to
either party or any officer or other representative of the party to be notified,
or may be sent by certified mail, return receipt requested, addressed, postage
prepaid, to said addresses. Mailed notices and demands shall be deemed to have
been given upon the date of the executed return receipt (provided that (i) if
any party shall refuse delivery or (ii) if delivery fails because of an address
change that has not been received as required by this Section 13.1, then, in
either of such events, notices shall be deemed given when mailed), or, if made
by personal, courier or other expedited delivery to the addresses designated in
Section 1.1 hereinabove, then upon the delivery. Notice of change of address for
notices shall not be deemed made until received or rejected. Unless otherwise
specified by Landlord, the payment of Rent shall be to the first address of
Landlord as set forth in Section 1.1 herein.
13.2 Successors and Assigns. All covenants, promises, conditions,
representations and agreements herein contained shall be binding upon, apply and
inure to the parties hereto and their respective heirs, executors,
administrators, successors and permitted assigns.
13.3 Entire Agreement. This Lease, the Environmental Addendum and the
Exhibits attached hereto constitute the sole and exclusive agreement between the
parties with respect to the Premises. No amendments, modifications of or
supplements to this Lease shall be effective unless in writing and executed by
Landlord and Tenant.
13.4 Time is of the Essence. The time of the performance of all of the
covenants, conditions and agreements of this Lease is of the essence of this
Lease.
13.5 Relationship of Parties; Usufruct. The parties hereto shall always be
as Landlord and Tenant and nothing herein shall be construed so as to constitute
a joint venture or partnership between Landlord and Tenant. This Lease creates a
usufruct not subject to levy and sale and no estate in or with respect to the
Premises, or any portion thereof, is granted or conveyed hereby.
13.6 Litigation. It is mutually agreed that in the event Landlord commences
any summary proceeding for non-payment of any Rent, Tenant will not interpose
any non-compulsory counterclaim of whatever nature or description in any such
proceeding. Landlord and Tenant hereby waive the right to a trial by jury in
connection with any dispute arising out of this Lease or the use or possession
of the Premises by Tenant.
-13-
14
13.7 Governing Law. This Lease shall be construed under the laws of the
State of Georgia.
13.8 Partial Invalidity. If any provision of this Lease or the application
thereof to any person or circumstance shall to any extent be held invalid, then
the remainder of this Lease or the application of such provision to persons or
circumstances other than those as to which it is held invalid shall not be
affected thereby, and each provision of this Lease shall be valid and enforced
to the fullest extent permitted by law.
13.9 Submission of Lease. The submission of this Lease for examination does
not constitute an offer to lease, or a reservation of or option for the
Property, and this Lease shall be effective only upon execution and delivery
thereof by Landlord and Tenant.
13.10 Interpretation. In interpreting this Lease in its entirety, the
printed provisions of this Lease and any additions written or typed thereon
shall be given equal weight, and there shall be no inference, by operation of
law or otherwise, that any provision of this Lease shall be construed against
either party hereto.
13.11 Broker. Landlord and Tenant hereby agree that, in connection with
this Lease, neither have dealt with any broker or other person or entity
entitled to any brokerage commission, fee or other compensation. Each party
shall indemnify, defend and hold harmless the other, their agents and legal
representatives against any fee, commission or other compensation due to any
person, firm or corporation claiming to have acted in said party's behalf.
13.12 Limitation of Liability. Landlord's liability to Tenant for damages
or otherwise with respect to the Lease shall be limited solely to and recovered,
if at all, solely from Landlord's interest in the Property. Landlord shall, at
any time and from time to time, have the absolute right to sell, assign, pledge
or otherwise transfer its interest in the Premises or this Lease. Landlord shall
be relieved of all its obligation and liability hereunder after Landlord has
conveyed the Premises and assigned this Lease to a successor Landlord. Landlord
may assign this lease to an entity in connection with the acquisition of the
Premises, in which case Landlord will be released from all liability hereunder.
13.13 Survival of Obligations. The provisions of this Lease with respect
to any obligation of Tenant to pay any sum in order to perform any act required
by this Lease after the expiration or other termination of this Lease shall
survive the expiration or other termination of this Lease.
13.14 Headings, Captions and References. The section captions contained in
this Lease are for convenience only and do not in any way limit or amplify any
term of provision hereof. The use of the terms "hereof," "hereunder" and
"herein" shall refer to this Lease as a whole, inclusive of the Exhibits, except
when noted otherwise. The use of the masculine or neuter genders herein shall
include the masculine, feminine and neuter genders and the singular form shall
include the plural when the context so requires.
-14-
15
13.15 Attorneys' Fees. The unsuccessful party in any action or proceeding
shall pay for all costs, expenses and reasonable attorneys' fees incurred by the
prevailing party or its agents or both in enforcing the covenants and agreements
of this Lease. The term "prevailing party," as used herein, shall include,
without limitation, a party who obtains legal counsel and brings an action
against the other party by reason of the other party's breach or default and
obtains substantially the relief sought, whether by compromise, settlement or
judgment.
13.16 Hazardous Substances. SEE ENVIRONMENTAL ADDENDUM ATTACHED TO THIS
LEASE.
13.17 Waiver. The waiver by Landlord of any breach of any term, covenant
or condition herein contained shall not be deemed to be a waiver of such term,
covenant or condition or any subsequent breach of the same or any other term,
covenant or condition herein contained. The subsequent acceptance of Rent
hereunder by Landlord shall not be deemed to be a waiver of any proceeding
breach by Tenant of any term, covenant or condition of this Lease, other than
the failure of Tenant to pay the particular Rent so accepted, regardless of
Landlord's knowledge of such preceding breach at the time of acceptance of such
Rent. No covenant, term or condition of this Lease shall be deemed to have been
waived by Landlord, unless such waiver be in writing by Landlord and delivered
to Tenant.
13.18 Accord and Satisfaction. No payment by Tenant or receipt by Landlord
of a lesser amount than the Rent herein stipulated shall be deemed to be other
than on account of the earliest stipulated Rent, nor shall any endorsement or
statement on any check or any letter accompanying any check or payment as Rent
be deemed an accord and satisfaction, and Landlord may accept such check or
payment without prejudice to Landlord's right to recover the balance of such
Rent or pursue any other remedy provided in this Lease.
13.19 Tenant Defined, Use of Pronoun. The word "Tenant" shall be deemed
and taken to mean each and every person or party mentioned as a Tenant herein,
be the same one or more; and if there shall be more than one Tenant, any notice
required or permitted by the terms of this Lease may be given by or to anyone
thereof, and shall have the same force and effect as if given by or to all
thereof. The use of the neuter singular pronoun to refer to Landlord or Tenant
shall be deemed a proper reference even though Landlord or Tenant may be an
individual, a corporation, or a group of two or more individuals or
corporations. The necessary grammatical changes required to make the provisions
of this Lease apply in the plural sense where this is more than one Landlord or
Tenant and to either corporations, associations, partnerships or individuals,
males or females, shall, in all instances, be assumed as though in each case
fully expressed.
13.20 Covenant to Operate. Commencing on the Commencement Date, and
thereafter for the balance of the Term, Tenant hereby covenants that it shall
continuously occupy and use the Premises solely for conducting the Permitted
Use, as defined herein.
-15-
16
This Section 13.21 shall apply during the term of the Lease, as same may
be extended. Upon the last day of the Term, Landlord shall redeliver possession
of any such vehicle to Tenant.
IN WITNESS WHEREOF, this Lease has been executed under seal as of the day
and year first above written.
LANDLORD:
WINCO, LTD., a Georgia limited partnership, by
its two (2) sole general partners
XXXXX XXXXXX By: /s/ XXXXXX X. XXXXXXXXXXX, XX.
---------------------- -------------------------------------------
Witness Xxxxxx X. Xxxxxxxxxxx, Xx., General Partner
By: /s/ XXXXXXXX X. XXXXXXXXXXX
-------------------------------------------
Xxxxxxxx X. Xxxxxxxxxxx, General Partner
TENANT:
XXXXXXXXXXX AUTOMOTIVE GROUP, INC.
d/b/a XXXXXXXXXXX NISSAN
/s/ [Illegible signature]
------------------------- By: /s/ Xxxxxxx X. Xxxxxx
Witness -----------------------------------------
Its: CEO
------------------------------------
Attest: /s/ XXXXX XXXXXX
-----------------------------------------
ITS: AUDITOR
------------------------------------
(CORPORATE SEAL)
-16-
17
APPENDIX I
ENVIRONMENTAL ADDENDUM
------------------------------------
This is an Addendum to the Lease dated the 5th day of May, 1998 ("Lease")
between WINCO, LTD., a Georgia limited partnership, as Landlord, and Xxxxxxxxxxx
Automotive Group, Inc. d/b/a Xxxxxxxxxxx Nissan, as Tenant. Each capitalized
term which is not defined in this Addendum shall have the meaning ascribed to
such term in the Lease. In the event of any conflict between the provisions of
the Lease and the provisions of this Addendum, this Addendum shall control.
1. Control of the Premises. Tenant has had the opportunity to examine the
Premises and hereby agrees to accept them in the "as is" condition existing on
the Commencement Date. Tenant further acknowledges that Landlord has not made
any representations as to the present or future condition of the Premises, or
the presence or absence of hazardous substances (as hereinafter defined)
therein. If the Premises, the Buildings, or any equipment, trade fixtures or
other mechanical apparatus therein contains any hazardous substances, Landlord,
at its election, shall have the right to (i) case Tenant to remove and properly
dispose of same, all at Tenant's sole costs and expense and in compliance with
the provisions hereof, or (ii) perform the removal and disposal thereof itself,
in which event Tenant shall reimburse Landlord, on demand, for the cost incurred
by Landlord in doing so and securing the certifications referred to below.
2. Use. Landlord acknowledges that Tenant's intended use of the Premises
is for the operation of an automobile dealership and that said use may, as part
of Tenant's normal business operations, include the handling, storage,
production, disposal, sale or transportation of hazardous substances as
hereinafter defined. Except in connection with its normal business operations or
as otherwise specifically permitted herein, Tenant shall not cause or permit any
hazardous substances to be brought upon, generated, treated, kept or used in or
about the Premises by Tenant, its agents, employees, contractors or invitees.
3. Compliance with Laws. With respect to Tenant's use of the Premises,
Tenant shall at all times, at its own cost and expense, comply with all federal,
state and local laws, ordinance, regulations and standards relating to the use,
analysis, production, storage, sale, disposal or transportation of any hazardous
materials ("Hazardous Substance Laws"), including oil or petroleum products or
their derivatives, solvents, PCB's, explosive substances, asbestos, radioactive
materials or waste, and any other toxic, ignitable, reactive, corrosive,
contaminating or pollution materials ("hazardous substances") which are now or
in the future subject to any governmental regulations.
4. Notice to Landlord. Tenant shall give written notice to Landlord within
three (3) business days after the date on which Tenant learns or first has
reason to believe that:
4.1 There has or will come to be located on or about the Premises any
hazardous substance, the production, transportation, storage, use or
handling of which requires a permit or license from any federal, state or
local governmental agency. The notice provisions of this Addendum shall not
apply to, and Landlord shall not have any right to terminate the Lease
18
on account of any use by Tenant in the course of a trade or business
conducted on the Premises of a substance which (a) is classified as a
hazardous substance under the Hazardous Substance Laws; (b) is of a type
which, under current industry practice, is commonly used as an integral
part of Tenant's approved business use of the Premises; (c) is so used by
Tenant in full compliance with applicable provisions of all Hazardous
Substance Laws; and (d) Tenant has given Landlord complete prior notice of
its use at the Premises.
4.2 Any release, discharge or emission of any hazardous substance has
occurred on or about the Premises.
4.3 Any (a) enforcement, cleanup, removal or other governmental or
regulatory action has been threatened or commenced against Tenant or with
respect to the Premises pursuant to any Hazardous Substance Laws; or (b)
any claim has been made or threatened by any person or entity against
Tenant or the Premises on account of any alleged loss or injury claimed to
result from the alleged presence or release on the Premises of any
hazardous substances; or (c) any report, notice or complaint has been made
to or filed with any governmental agency concerning the presence, use or
disposal of any hazardous substances on the Premises. Any such notice shall
be accompanied by copies of any such claim, report, complaint, notice,
warning or other communication that is in the possession of or is
reasonably available to Tenant.
Any notice required under this Section 4.3 shall be accompanied by (i)
a copy of all permits, licenses, proofs of disclosure to governmental
agencies pertaining to hazardous substances that have not previously been
furnished to Landlord; and (ii) copies of any Material Safety Data Sheets
pertaining to such substances that are required by applicable law.
5. Disposal. Except for materials that are (a) lawfully discharged from
the Premises, or (b) lawfully maintained on the Premises and/or sold in the
ordinary course of Tenant's business, Tenant shall cause any hazardous
substances to be removed from the Premises for disposal and to be transported
solely by duly licensed hazardous substances transporters to duly licensed
facilities for final disposal to the extent required by and in accordance with
applicable Hazardous Substances Laws, and shall upon request deliver to Landlord
copies of any hazardous waste manifest reflecting the proper disposal of such
substances.
6. Actions and Proceedings. Except in emergencies or as otherwise required
by law, Tenant shall not take any remedial action in response to the presence or
release of any hazardous substances on or about the Premises without first
giving written notice of the same to Landlord. Tenant shall not enter into any
settlement agreement, consent decree or other compromises with respect to any
claims relating to any hazardous substances in any way connected with the
Premises without first notifying Landlord of Tenant's intention to do so and
affording Landlord the opportunity to participate in any such proceedings.
7. Environmental Audits. Landlord may, but shall not be required to,
engage such independent contractors as Landlord determines to be appropriate to
perform, from time to time, an
-2-
19
audit, including environmental sampling and testing of (a) the Premises, the
surrounding soil and any adjacent areas, and any groundwater located under or
adjacent to the Premises and/or any adjoining property, (b) Tenant's compliance
with all Hazardous Substances Laws and the provisions of this Addendum, and (c)
the provisions made by Tenant for carrying out any remedial action that may be
required by reason of the nature of Tenant's business and its operations of the
Premises (collectively an "Environmental Audit").
7.1 Costs and Expenses. All costs and expenses incurred by Landlord
in connection with any such Environmental Audit shall be paid by Landlord,
except that if any such Environmental Audit shows that Tenant has failed to
comply with the provisions of this Addendum, or that the Premises
(including surrounding soil and any underlying or adjacent property or
groundwater) have become contaminated due to the operations or activities
of Tenant at the Premises, then all the costs and expenses of such
Environmental Audit shall be paid by Tenant. Notwithstanding the foregoing,
if Landlord elects to have an Environmental Audit performed upon the
expiration or earlier termination of the Lease (the "Final Environmental
Audit"), then Landlord and Tenant shall each pay one-half (1/2) of the cost
of such Final Environmental Audit; provided that, if such Final
Environmental Audit shows that Tenant has failed to comply with the
provisions of this Addendum, or that the Premises (including surrounding
soil and any underlying or adjacent property or groundwater) have become
contaminated due to the operations or activities of Tenant at the Premises,
than all of the costs and expense of such Final Environmental Audit shall
be paid by Tenant.
7.2 Conduct of Audit. Each Environmental Audit (excepting only the
Final Environmental Audit, which shall not require any notice to Tenant)
shall be conducted (a) only after advance notice thereof has been provided
to Tenant at least twenty-four (24) hours prior to the date of such audit,
and (b) in a manner reasonably designed to minimize the interruption of
Tenant's operations and use of the Premises. Any damages to the Premises or
to Tenant's property which is caused by the independent contractor
conducting the Environmental Audit shall be paid for by the party
responsible for paying for the Environmental Audit, as determined pursuant
to Section 7.1 above.
8. Termination of Lease. Upon the expiration or earlier termination of the
term of the Lease, Tenant shall (a) cause all hazardous substances previously
owned, stored or used by Tenant to be removed from the Premises and disposed of
in accordance with applicable provisions of law; (b) remove any aboveground or
underground storage tanks or other containers installed or used by Tenant to
store any hazardous substances on the Premises, and repair any damage to the
Premises caused by such removal; (c) cause any soil, groundwater or other
portion of the Premises which is contaminated, to be decontaminated, detoxified
or otherwise cleaned up in accordance with the requirements of any governmental
authority with control over the Premises; (d) cause any property adjacent to the
Premises which is owned or controlled by Landlord which has become contaminated
by any hazardous substances brought onto, stored or used by Tenant on the
Premises; to be decontaminated, detoxified or otherwise cleaned up in accordance
with the requirements of any governmental authority with control over such
property; and (e) surrender possession of the Premises to Landlord free of
hazardous substances.
-3-
20
9. Indemnification by Tenant. Tenant shall indemnify, defend with counsel
reasonably acceptable to Landlord and hold Landlord free and harmless from any
and all liabilities, damages, claims, penalties, fines, settlements, causes of
action, costs or expense, including reasonable attorneys' fees, environmental
consultant and laboratory fees, and the costs and expense of investigating and
defending any claims or proceedings, resulting from or attributable to (a) the
presence, disposal, release or threatened release of any hazardous substance
that is on, from or affecting the Premises including the soil, water,
vegetation, buildings, personal property, persons, animals or otherwise; (b) any
personal injury (including wrongful death) or property damage (real or
personal) arising out of or relating to the hazardous substance; (c) any lawsuit
or administrative order relating to the hazardous substance; and (d) any
violation of any laws applicable to the hazardous substance.
10. Survival. Tenant's indemnification obligations set forth herein shall
survive the expiration or earlier termination of the term of the Lease.
-4-
