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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
November 26, 1997
(Date of Report) (Date of earliest event reported)
NANTUCKET INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
1-8509 58-0962699
(Commission File Number) (I.R.S. Employer
Identification No.)
510 Broadhollow Road, Melville, NY 11747
(Address of principal executive offices) (Zip Code)
(516) 293-3172
Registrant's telephone number, including area code
----------------------------------------------------------------------------
(Former name or former address, if changed since last report)
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Item 5. Other Events.
(a) On November 26, 1997, the Board of Directors of the Company accepted
the resignations of Joseph Visconti and Ronald S. Hoffman as members of the
Board of Directors and elected Steven Schneider and Richard Ryan to fill the
vacancies created by such resignations. In addition, the Board increased the
number of Directors from nine (9) to ten (10) members and elected Marc M. Feder
and James H. Carey as Directors.
(b) On November 26, 1997, the Board of Directors accepted the
resignation of Ronald S. Hoffman, as Chief Financial Officer, Vice
President-Finance, and Secretary and elected Nicholas Dmytryszyn as Chief
Financial Officer and Katherine M. Kozub as Secretary.
(c) On December 3, 1997, the Company entered into a lease for
approximately 71,000 square feet of space at 435 Industrial Park Road in
Cartersville, Georgia for a 60-month term commencing on January 1, 1998. The
monthly rental amount will be $15,679 increasing based on an established formula
over the term of the lease. These premises will be used for offices, warehouse,
packaging and as a distribution center.
(d) On December 9, 1997, Donald Gold, a Director of the Company filed a
Complaint against the Company in the State Court of Fulton County, State of
Georgia relating to payments allegedly due to him under the March 18, 1994
Severance Agreement.
Item 7
(c) Exhibits
Exhibits which, in their entirety, are incorporated by reference to any
report, exhibit or other filing previously made with the Securities and Exchange
Commission are designated by an asterisk (*) and the location of such material
is included in its description.
<TABLE>
<CAPTION>
Exhibit No Description Page No.
- ---------- ----------- --------
<S> <C> <C>
99 (S) Lease dated December 3, 1997 Filed Herewith
</TABLE>
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
NANTUCKET INDUSTRIES, INC.
/s/ Stephen M. Samberg
By: _______________________________________
Stephen M. Samberg,
Chairman and Chief Executive Officer
Dated: December 19, 1997
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FIRST INDUSTRIAL, L.P.
INDUSTRIAL BUILDING LEASE
(TRIPLE NET/SINGLE TENANT)
SECTION 1: BASIC TERMS
This Section 1 contains the Basic Terms of this Lease between Landlord
and Tenant, named below. Other Sections of the Lease referred to in this Section
1 explain and define the Basic Terms and are to be read in conjunction with the
Basic Terms.
<TABLE>
<S> <C> <C>
1.1 Date of Lease: December 3, 1997 -------
1.2 Landlord: First Industrial, L.P., a Delaware limited
partnership
1.3 Tenant: Nantucket Industries, Inc., a Delaware corporation
1.4 Premises The entire Building, consisting of approximately
71,000 rentable square feet, the Land and
the Property.
1.5 Building: The building constructed on a portion of the Land,
said building being commonly known as 435 Industrial Park
Road, Bartow County, Cartersville, Georgia
1.6 Land: That certain parcel(s) of land upon which the Building
is located, identified as Tract I on Exhibit "A"
attached hereto and incorporated herein by this reference.
1.7 Property: The Land and all improvements thereon, including the
Building, the Common Areas and the parking facilities on the Land.
1.8 Lease Term: 5 years 0 months ("Term"), commencing January 1,
1997 ("Commencement Date") and ending December 30, 2002
("Expiration Date"). (SEE SPECIAL STIPULATION 11)
1.9 Permitted Uses: Office, warehouse, packaging and distribution
center for clothing and any other related use permitted by law
(or any other use consented to by Landlord in writing, such
consent not to be unreasonably withheld) (See Section 4)
1.10 Tenant's Guarantor: (if none, so state) None.
1.11 Brokers: (See Section 22; if none, so state)
(A) Tenant's Broker: Brannen/Goddard Company
(B) Landlord's Broker: None
1.12 Security Deposit: $16,863.00 (See Section 4)
1.13 Rent Payable by
Tenant: See Exhibit "B"
1.14 Tenant's Property: See Section 12.2
1.15 Riders to Lease: The following riders are attached to and made a part of this Lease.
(If none, so state)
Exhibit A - Legal Description
Exhibit B - Base Rental Payments
Exhibit C - Landlord's Repairs and Improvements
Exhibit D - Required Insurance
Exhibit E - Special Stipulations 1 through 12
</TABLE>
SECTION 2: LEASE OF PREMISES; RENT
2.1 Lease of Premises for Lease Term. Landlord hereby leases the
Premises to Tenant, and Tenant hereby rents the Premises from Landlord, for the
Lease Term and subject to the conditions of this Lease.
2.2 Types of Rental Payments. Tenant shall pay rents of (a) net base
rent payable in monthly installments as set forth in Exhibit "B" attached hereto
(the "Net Base Rent"), in advance, on the first day of each and every calendar
month during the term of this Lease; (b) all costs, expenses and charges of
every nature relating to, or incurred in connection with, the ownership and
operation of the Premises and that are attributable to, or become due, during
the Term ("Additional Rent"); and (c) in the event that any monthly installment
of Net Base Rent is not paid within ten (10) days of the date when due, a late
charge in an amount equal to five percent (5%) of the then-delinquent
installment of Net Base Rent (the "Late Charge"; the Net Base Rent, Additional
Rent and Late Charge shall collectively be referred to as "Rent"). All Rent
shall be paid to First Industrial, L.P., P.O. Box 75631, Chicago, Illinois
60675- 5621 (or to such other entity designated as Landlord's management agent,
if any, and if Landlord so appoints such a management agent, the "Agent"), or
pursuant to such other directions as Landlord shall designate in this Lease or
otherwise. (SEE SPECIAL STIPULATION 1)
2.3 Covenants Concerning Rental Payments. Tenant shall pay the Rent
promptly when due, without notice or demand, and without any abatement,
deduction or setoff, except as may otherwise be expressly and specifically
provided in this Lease. No payment by Tenant, or receipt or acceptance by Agent
or Landlord, of a lesser amount than the correct Rent shall be deemed to be
other than a payment on account, nor shall any endorsement or statement on any
check or letter accompanying any payment be deemed an accord or satisfaction,
and Agent or Landlord may accept such payment without prejudice to its right to
recover the balance due or to pursue any other remedy available to Landlord. If
the Commencement Date occurs on a day other than the first day of a calendar
month, the Rent due for the partial calendar months occurring at the
commencement and the
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expiration of the Term shall be prorated on a per diem basis. It is intended
that the Rent provided in this Lease shall be an absolutely net return to
Landlord throughout the Term and any renewals or extensions thereof.
SECTION 3: TAXES AND ASSESSMENTS; ASSOCIATION DUES
3.1 Taxes. Tenant agrees to pay as "Additional Rent" for the Premises
(i) all governmental taxes, assessments, fees, penalties and charges of every
kind or nature (other than Landlord's income taxes), whether general, special,
ordinary or extraordinary, due at any time, or from time to time, during the
Term and any extensions thereof, in connection with the ownership, leasing or
operation of the Premises or of the personal property and equipment located
therein or in connection therewith and (ii) any reasonable expenses incurred by
Landlord in contesting such taxes or assessments and/or the assessed value of
the Premises (the "Taxes"). All such Taxes shall be paid by Tenant before they
become delinquent. The Taxes for the first and last years of the Term and any
extension thereof will be appropriately prorated. If any special assessments
levied against the Premises are payable in installments, Tenant shall be
responsible only for those installments that are attributable to the period
during which Tenant has possession of the Premises and Landlord shall allow for
the longest available payment period.. For purposes hereof, Taxes for any year
shall be Taxes that are due for payment or paid in that year, rather than taxes
that are assessed or become a lien or accrue during such year. If at any time
during the Term, the methods of taxation prevailing on the date hereof shall be
altered, such additional or substitute tax, assessment, levy, charge or
imposition shall be deemed to be included within the term "Taxes" for the
purposes hereof. (SEE SPECIAL STIPULATION 2)
3.2 Association Dues. If at any time or from time to time during the
Term and any extensions thereof, the Premises are or shall be subject to dues or
assessments levied by an owners' association involving the Premises and other
nearby or contiguous real property, Tenant shall pay, before delinquent and as
Additional Rent, all such dues and assessments until the termination of the Term
and/or any extension of this Lease. If such dues and assessments related to
specific periods of time, Tenant will be responsible for any such dues and
assessments due during the Term and any extensions thereof.
SECTION 4: USE OF PREMISES; SECURITY DEPOSIT
4.1 Use of Premises. The Premises shall be used for the purpose(s) set
forth in Section 1.9 above and for no other purpose whatsoever. Tenant shall
not, at any time, use or occupy, or suffer or permit anyone to use or occupy,
the Premises, or do or permit anything to be done in the Premises, in any manner
that may (a) violate any Certificate of Occupancy for the Premises; (b) cause,
or be liable to cause, injury to the Premises or any equipment, facilities or
systems therein, reasonable wear and tear excepted; (c) constitute a violation
of the laws and requirements of any public authority or the requirements of
insurance bodies or the rules and regulations of the Premises; (d) impair or
tend to impair the character, reputation or appearance of the Premises as a
first-class property; and (e) impair or tend to impair the proper and economic
maintenance, operation, and repair of the Premises and its equipment, facilities
or systems.
4.2 Signage. Tenant shall not affix any sign of any size or character
to any portion of the Premises without prior written approval of Landlord, which
approval shall not be unreasonably withheld or delayed. Tenant shall remove all
signs of Tenant upon the expiration or earlier termination of this Lease and
immediately repair any damage to the Premises caused by, or resulting from, such
removal.
4.3 Security Deposit. Simultaneously with the execution and delivery of
this Lease, Tenant shall deposit with Landlord or Agent the sum set forth in
Section 1.12 above, in good funds (the "Security"), representing security for
the performance by Tenant of the covenants and obligations hereunder. The
Security shall be held by Landlord or Agent, without interest, in favor of
Tenant; provided, however, that no trust relationship shall be deemed created
thereby and the Security may be commingled with other assets of Landlord. If
Tenant defaults in the performance of any of its covenants hereunder and such
default continues beyond any applicable notice and cure period, Landlord or
Agent may, with notice to Tenant, apply the whole or any part of the Security,
to the extent required for the payment of any Rent or other sums due from Tenant
hereunder, in addition to any other remedies available to Landlord. In the event
Landlord or Agent shall so apply the Security, Tenant shall, upon demand,
immediately deposit with Landlord or Agent a sum equal to the amount so used.
Tenant's failure to do so shall constitute a default under this Lease. If Tenant
fully and faithfully complies with all the covenants hereunder, the Security (or
any balance thereof) shall be returned to Tenant within thirty (30) days after
the last to occur of (i) the date the Term expires or terminates, (ii) delivery
to Landlord of possession of the Premises and (iii) Landlord's or Agent's
inspection of the Premises and determination that all obligations of Tenant
under this Lease have been fully satisfied. Landlord may deliver the Security to
any purchaser of Landlord's interest in the Premises [or any Successor Landlord
(defined below), if applicable], and thereupon Landlord and Agent shall be
discharged from any further liability with respect to the Security. Each time
the Rent is increased, Tenant shall deposit additional funds with Landlord
sufficient to increase the Security to an amount which bears the same
relationship to the increased rent as the initial Security bore to the initial
Rent.
SECTION 5: CONDITION AND DELIVERY OF PREMISES
5.1 Condition of Premises. Tenant agrees that Tenant is familiar with
the condition of the Premises, and Tenant hereby accepts the Premises on an
"AS-IS," "WHERE-IS" basis. Tenant acknowledges that neither Landlord nor Agent
nor any representative of Landlord has made any representation as to the
condition of the Premises or the suitability of the Premises for Tenant's
intended use. Tenant represents and warrants that Tenant has made its own
inspection of the Premises and is not relying on any representation of Landlord
with respect thereto. Neither Landlord nor Agent shall be obligated to make any
repairs, replacements or improvements of any kind or nature to the Premises
(whether structural or nonstructural and whether or not involving the roof of
the Building, the Building's HVAC (defined below) system, the Premises' parking
lot, or any other component of the Premises) in connection with, or in
consideration of, this Lease, except (a) as set forth in Section 13 and 17 and
(b) with respect to any repairs and improvements expressly and specifically
described in Exhibit "C" attached hereto ("Work Items"). Landlord agrees to
enforce, or cause Agent to enforce, upon Tenant's request, all manufacturer's or
contractor's warranties, if any, given in connection with the Work Items.
5.2 Delay in Commencement. Landlord shall not be liable to Tenant if
Landlord does not deliver possession of the Premises to Tenant on the
Commencement Date. The obligations of Tenant under the Lease shall not thereby
be affected, except that the Commencement Date shall be delayed until Landlord
delivers possession of the Premises to Tenant, and the Lease Term shall be
extended by a period equal to the number of days of delay in delivery of
possession of the Premises to Tenant, plus the number of days necessary to end
the Lease Term on the last day of a month.
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SECTION 6: SUBORDINATION; NOTICES TO SUPERIOR LESSORS AND MORTGAGEES; ATTORNMENT
6.1 Subordination of Lease. This Lease, and all rights of Tenant
hereunder, are subject and subordinate to all ground leases of the Premises now
or hereafter existing and to all mortgages or trust deeds or deeds of trust (all
of which are hereafter referred to collectively as "Mortgages"), that may now or
hereafter affect or encumber all or any portion of Landlord's interest in the
Premises. This subordination shall apply to each and every advance made, or to
be made, under such Mortgages; to all renewals, modifications, replacements and
extensions of such Mortgages; and to "spreaders" and consolidations of such
Mortgages. This Section 6.1 shall be self-operative and no further instrument of
subordination shall be required; however, in confirmation of such subordination,
Tenant shall from time to time execute, acknowledge and deliver any instrument
that Landlord may from time to time reasonably require in order to evidence or
confirm such subordination. If Tenant fails to execute, acknowledge or deliver
any such instrument within twenty (20) days after request therefor, Tenant
hereby irrevocably constitutes and appoints Landlord as Tenant's
attorney-in-fact, which appointment is coupled with an interest, to execute and
deliver any such instruments for and on behalf of Tenant. Tenant acknowledges
that this Lease has been (and, in the future, may be) assigned by Landlord to a
Superior Mortgagee (defined below) as additional collateral security for the
loans secured by the Superior Mortgage (defined below) held by such Superior
Mortgagee. Any ground lease to which this Lease is subject and subordinate is
hereinafter referred to as a "Superior Lease," the lessor under a Superior Lease
is hereinafter referred to as a "Superior Lessor," and the lessee thereunder, a
"Superior Lessee"; and any Mortgage to which this Lease is subject and
subordinate is hereinafter referred to as a "Superior Mortgage," and the holder
of a Superior Mortgage is hereinafter referred to as a "Superior Mortgagee."
Notwithstanding the foregoing, this Lease may be made senior to the lien of any
Superior Mortgage, if and only if the Superior Mortgagee thereunder so requests.
(SEE SPECIAL STIPULATION 3)
6.2 Notice in the Event of Default. In the event that Landlord breaches
or otherwise fails to timely perform any of its obligations under this Lease,
Tenant shall give written notice of such alleged breach or default to Landlord
and to each Superior Mortgagee and Superior Lessor whose name and address shall
previously have been furnished, in writing, to Tenant, whereupon any or all of
Landlord, a Superior Mortgagee or Superior Landlord or may remedy or cure such
breach or default within thirty (30) days following the giving of such notice;
provided, however, that said thirty (30)-day cure period shall be automatically
extended in the event that the breach or default cannot, by its nature, be cured
within thirty (30) days and one or more of Landlord, the Superior Mortgagee or
the Superior Lessor is diligently proceeding to cure said default.
6.3 Successor Landlord. If any Superior Lessor or Superior Mortgagee
shall succeed to the rights of Landlord hereunder, then, at the request of such
party (hereinafter referred to as "Successor Landlord"), Tenant shall attorn to
and recognize each Successor Landlord as Tenant's landlord under this Lease and
shall promptly execute and deliver any instrument such Successor Landlord may
reasonably request to further evidence such attornment. Tenant hereby
acknowledges that in the event of such succession, then from and after the date
on which the Successor Landlord acquires Landlord's rights and interest under
this Lease (the "Succession Date"), the rights and remedies available to Tenant
under this Lease with respect to any obligations of any Successor Landlord shall
be limited to the equity interest of the Successor Landlord in the Premises; and
the Successor Landlord shall not (a) be liable for any act, omission or default
of Landlord or other prior lessor under this Lease if and to the extent that
such act, omission or default occurs prior to the Succession Date; (b) except as
required under Section 17 of this Lease, be required to make or complete any
tenant improvements or capital improvements, or to repair, restore, rebuild or
replace the Premises or any part thereof in the event of damage, casualty or
condemnation; or (c) be required to pay any amounts to Tenant that are due and
payable, under the express terms of this Lease, prior to the Succession Date.
Additionally, from and after the Succession Date, Tenant's obligation to pay
Rent (as provided in Sections 2 and 3 hereof) shall not be subject to any
abatement, deduction, set-off or counterclaim against the Successor Landlord
that arises as a result of, or due to, a default of Landlord or any other lessor
that occurs prior to the Succession Date. Moreover, no Successor Landlord shall
be bound by any advance payments of Rent made prior to the calendar month in
which the Succession Date occurs, nor by any Security that is not actually
delivered to, and received by, the Successor Landlord. (SEE SPECIAL STIPULATION
3)
SECTION 7: QUIET ENJOYMENT
Subject to the provisions of this Lease, so long as Tenant pays all of
the Rent and performs all of its other obligations hereunder, Tenant shall not
be disturbed in its possession of the Premises by Landlord, Agent or any other
person lawfully claiming through or under Landlord. This covenant shall be
construed as a covenant running with the land of the Premises and is not a
personal covenant of Landlord.
SECTION 8: ASSIGNMENT, SUBLETTING AND MORTGAGING
8.1 Prohibition. Tenant acknowledges that this Lease and the Rent due
under this Lease have been agreed to by Landlord in reliance upon Tenant's
reputation and creditworthiness and upon the continued operation of the Premises
by Tenant for the particular use set forth in Section 4 above; therefore, Tenant
shall not, whether voluntarily, or by operation of law, or otherwise: (a) assign
or otherwise transfer this Lease; (b) sublet the Premises or any part thereof,
or allow the same to be used or occupied by anyone other than Tenant; or (c)
mortgage, pledge, encumber, or otherwise hypothecate this Lease or the Premises,
or any part thereof, in any manner whatsoever, without in each instance
obtaining the prior written consent of Landlord, which consent shall not be
unreasonably withheld. Any purported assignment, mortgage, transfer, pledge or
sublease made without the prior written consent of Landlord shall be absolutely
null and void and of no legal force or effect. No assignment of this Lease shall
be effective and valid unless and until the assignee executes and delivers to
Landlord any and all documentation reasonably required by Landlord in order to
evidence assignee's assumption of all obligations of Tenant hereunder. Any
consent by Landlord to a particular assignment, sublease or mortgage shall not
constitute consent or approval of any subsequent assignment, sublease or
mortgage, and Landlord's written approval shall be required in all such
instances. Any consent by Landlord to any assignment or sublease shall not be
deemed to release Tenant from its obligation hereunder and Tenant shall remain
fully liable for performance of all obligations under this Lease. In the event
that Landlord elects to reject any proposed sublease or assignment, the Tenant's
sole and exclusive remedy shall be to seek a declaratory judgment against
Landlord so as to enable Tenant to avoid a termination of this Lease. Any
violation of the provisions of this Section 8.1 shall constitute a default under
this Lease. (SEE SPECIAL STIPULATION 4)
8.2 Rights of Landlord. If this Lease is assigned, or if the Premises
(or any part thereof) are sublet or used or occupied by anyone other than
Tenant, whether or not in violation of this Lease, Landlord or Agent may
(without prejudice to,
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or waiver of its rights), collect rent from the assignee, subtenant or occupant.
Landlord or Agent may apply the net amount collected to the Rent herein
reserved, but no such assignment, subletting, occupancy or collection shall be
deemed a waiver of any of the provisions of this Section 8. With respect to the
allocable portion of the Premises sublet, in the event that the total rent and
any other considerations (whether cash or non-cash) received under any sublease
by Tenant is greater than the total Rent required to be paid, from time to time,
under this Lease, Tenant shall pay to Agent one hundred percent (100%) of such
excess as received from any subtenant and such amount shall be deemed a
component of the Additional Rent due under this Lease.
8.3 Permitted Transfers. The provisions of Section 8.1(a) shall not
apply to a transfer to a corporation into or with which Tenant is merged or
consolidated, or to which substantially all of Tenant's assets are transferred,
or to any corporation that controls or is controlled by Tenant, or is under
common control with Tenant, provided in any of such events (a) the successor to
Tenant has a net worth (computed in accordance with generally accepted
accounting principles), at least equal to the greater of (i) the net worth of
Tenant immediately prior to such merger, consolidation or transfer or (ii) the
net worth of Tenant on the date of this Lease and (b) proof satisfactory to
Landlord of such net worth shall have been delivered to Landlord at least ten
(10) days prior to the effective date of any such transaction. Any such
permitted transferee shall execute and deliver to Landlord any and all
documentation reasonably required by Landlord in order to evidence assignee's
assumption of all obligations of Tenant hereunder.
SECTION 9: COMPLIANCE WITH LAWS
If any license or permit is required for the conduct of Tenant's
business in the Premises, Tenant, at its expense, shall procure such license
prior to the Commencement Date, and shall maintain in good standing and renew
such license or permit. Tenant shall give prompt notice to Landlord of any
notice it receives of the violation of any law or requirement of any
governmental or administrative authority with respect to the Premises or the use
or occupation thereof. Tenant shall, at Tenant's expense, comply with all laws
and requirements of any governmental or administrative authorities that impose
any duty on Landlord, Agent or Tenant arising from Tenant's actions regarding
its business operations or use of the Premises, and Tenant shall pay all
expenses, fines and damages that are imposed upon any or all of Landlord, Agent,
any Superior Lessee, Superior Lessor or Superior Mortgagee, by reason or arising
out of Tenant's failure to fully and promptly comply with and observe the
provisions of this Section. (SEE SPECIAL STIPULATION 5)
SECTION 10: INSURANCE
10.1 Tenant Activities. Tenant shall not violate, or permit the
violation of, any condition imposed by any insurance policy issued in respect of
the Premises and shall not do, or permit anything to be done, or keep or permit
anything to be kept in the Premises, that would: (a) subject any or all of
Landlord, Agent, any Superior Lessor, any Superior Lessee or any Superior
Mortgagee to any liability or responsibility for personal injury or death or
property damage; (b) result in insurance companies of good standing refusing to
insure (or imposing special conditions on insuring) any or all of the Premises
or the property therein, in amounts reasonably satisfactory to Landlord; or (c)
result in the cancellation of (or the assertion of any defense by the insurer,
in whole or in part, to claims under) any policy of insurance with respect to
any or all of the Premises or the property therein.
10.2 Insurance to be Maintained by Tenant. Tenant shall, at its sole
cost and expense, at all times during the Term (and any extensions thereof)
obtain and pay for and maintain in full force and effect the insurance policy or
policies described in Exhibit D attached hereto. Certified copies of all
insurance policies required pursuant to this Lease (or certificates thereof, in
form and substance acceptable to Landlord), shall be delivered to Landlord not
less than ten (10) days prior to the Commencement Date. If Tenant fails to
submit such policies or certificates to Landlord within the specified time, or
otherwise fails to obtain and maintain insurance coverages in accordance with
this Section 10.2, then Landlord, at Landlord's sole option, may, but shall not
be obligated to, procure such insurance on behalf of, and at the expense of,
Tenant. Tenant shall reimburse Landlord for such amounts upon demand, it being
understood that any such sums for which Tenant is required to reimburse Landlord
shall constitute Additional Rent. (SEE SPECIAL STIPULATION 6)
10.3 Waiver of Right of Recovery. None of Landlord, Agent or Tenant
shall be liable to one another [or to any insurance company (by way of
subrogation of otherwise) insuring any such party] for any loss or damage to the
Premises, the structure of the buildings located thereon, other tangible
property located on the Premises, or any resulting loss of income, or losses
under workers' compensation laws and benefits, despite the fact that such loss
or damage might have been occasioned by the negligence or misconduct of such
party, its agents or employees, provided and to the extent that any such loss or
damage would be covered by insurance that the party suffering the loss is
required to maintain pursuant to the terms of this Lease. The failure of any
party to insure its property shall not void this waiver. Each of Landlord, Agent
and Tenant shall secure an appropriate clause in, or an endorsement upon, each
insurance policy obtained by it and covering or applicable to the Premises and
the personal property, fixtures, and equipment located therein or thereon,
pursuant to which the insurance company consents to such waiver of right of
recovery. The waiver of right of recovery set forth above in this Section 10.3
shall extend to Landlord, Agent, Tenant, and their respective agents and
employees, and each Superior Lessor, Superior Mortgagee, and to other
appropriate parties designated by Landlord.
SECTION 11: ALTERATIONS
11.1 Procedural Requirements. Tenant may, from time to time, at its
expense, make alterations or improvements in and to the Premises (hereinafter
collectively referred to as "Alterations"), provided that Tenant first obtains
the written consent of Landlord in each instance. Landlord's consent to
Alterations shall not be unreasonably withheld, provided that: (a) the
Alterations are non-structural and the structural integrity of the Premises
shall not be affected; (b) the Alterations are to the interior of the Premises;
(c) the proper functioning of the mechanical, electrical, heating, ventilating,
air-conditioning ("HVAC"), sanitary and other service systems of the Premises
shall not be affected and the usage of such systems by Tenant shall not be
increased; (d) Tenant shall have appropriate insurance coverage reasonably
satisfactory to Landlord regarding the performance and installation of the
Alterations; (e) the Alterations shall conform with all other requirements of
this Lease; and (f) Tenant shall have provided Landlord with detailed plans (the
"Plans") for such Alterations in advance of requesting Landlord's consent.
Additionally, after obtaining Landlord's preliminary consent to the Plans, but
before proceeding with any Alterations, Tenant shall, at its expense, obtain all
necessary governmental permits and certificates for the commencement and
prosecution of
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Alterations and shall submit to Agent, for Landlord's written approval, working
drawings, plans and specifications, and all permits for the work to be done and
Tenant shall not proceed with such Alterations until it has received said
approval. Tenant shall obtain and deliver to Agent (if so requested) either (i)
a performance bond and a labor and materials payment bond in form satisfactory
to Landlord, each in an amount equal to one hundred fifteen percent (115%) of
the estimated cost of the Alterations, or (ii) such other security as shall be
reasonably satisfactory to Landlord. After obtaining Landlord's approval to the
Alterations, Tenant shall give Landlord at least twenty (20) days prior written
notice of the commencement of any Alterations at the Premises, and Landlord may
elect to record and post notices of non- responsibility at the Premises.
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11.2 Performance of Alterations. Tenant shall cause the Alterations to
be performed in compliance with all applicable permits, laws and requirements of
public authorities, and with Landlord's reasonable rules and regulations or any
other restrictions that Landlord or Agent may impose on the Alterations. Tenant
shall cause the Alterations to be diligently performed in a good and workmanlike
manner, using new materials and equipment at least equal in quality and class to
the standards for the Premises established by Landlord or Agent. Alterations
shall be performed by contractors first approved by Landlord, and Tenant's
agents, contractors, workmen, mechanics, suppliers and invitees shall work in
harmony, and not interfere with, Landlord and its agents and contractors (if
any). Tenant shall obtain all necessary permits and certificates for final
governmental approval of the Alterations and shall provide Landlord with "as
built" plans, copies of all construction contracts, governmental permits and
certificates and proof of payment for all labor and materials, including,
without limitation, copies of paid invoices and final lien waivers.
11.3 Lien Prohibition. Tenant shall pay when due all claims for labor
and material furnished to the Premises in connection with the Alterations.
Tenant shall not permit any mechanics or materialmen's liens to attach to the
Premises or Tenant's leasehold estate. Tenant, at its expense, shall procure the
satisfaction or discharge of record of all such liens and encumbrances within
thirty (30) days after the filing thereof. In the event Tenant has not so
performed, Landlord may, at its option, pay and discharge such liens and Tenant
shall be responsible to reimburse Landlord, on demand, for all costs and
expenses incurred in connection therewith, together with interest thereon at the
rate set forth in Section 21.3 below, which expenses shall include reasonable
fees of attorneys of Landlord's choosing, and any costs in posting bond to
effect discharge or release of the lien as an encumbrance against the Premises.
Any sums due from Tenant pursuant to the preceding sentence shall constitute
Additional Rent under this Lease.
SECTION 12: LANDLORD'S AND TENANT'S PROPERTY
12.1 Landlord's Property. Subject to Section 12.2 below, all fixtures,
machinery, equipment, improvements and appurtenances attached to, or built into,
the Premises at the commencement of, or during the Term, whether or not placed
there by or at the expense of Tenant, shall become and remain a part of the
Premises; shall be deemed the property of Landlord (the "Landlord's Property"),
without compensation or credit to Tenant; and shall not be removed by Tenant
unless Landlord requests their removal. Further, any personal property in the
Premises on the Commencement Date, movable or otherwise, unless installed and
paid for by Tenant, shall be and shall remain the property of Landlord and shall
not be removed by Tenant. In no event shall Tenant remove any of the following
materials or equipment without Landlord's prior written consent: any power
wiring or power panels, lighting or lighting fixtures, wall or window coverings,
carpets or other floor coverings, heaters, air conditioners or any other heating
or air conditioning equipment, fencing or security gates, or other similar
building operating equipment and decorations.
12.2 Tenant's Property. All movable non-structural partitions, business
and trade fixtures, machinery and equipment, communications equipment and office
equipment, whether or not attached to, or built into, the Premises, which are
installed in the Premises by, or for the account of, Tenant without expense to
Landlord and that can be removed without structural damage to the Premises, and
all furniture, furnishings and other articles of movable personal property owned
by Tenant and located in the Premises (collectively, the "Tenant's Property")
shall be and shall remain the property of Tenant and may be removed by Tenant at
any time during the Term, provided Tenant repairs or pays the cost of repairing
any damage to the Premises resulting from the installation and/or removal
thereof.
12.3 Removal of Tenant's Property. At or before the Expiration Date, or
the date of any earlier termination, Tenant, at its expense, shall remove from
the Premises all of Tenant's Property (except such items thereof as Landlord
shall have expressly permitted, in writing, to remain, which property shall
become the property of Landlord), and Tenant shall repair any damage to the
Premises resulting from any installation and/or removal of Tenant's Property.
Any other items of Tenant's Property that shall remain in the Premises after the
Expiration Date, or following an earlier termination date, may, at the option of
Landlord, be deemed to have been abandoned, and in such case, such items may be
retained by Landlord as its property or be disposed of by Landlord, in
Landlord's sole and absolute discretion and without accountability, at Tenant's
expense. Notwithstanding the foregoing, if Tenant is in default under the terms
of this Lease, it may remove Tenant's Property from the Premises only upon the
express written direction of Landlord.
SECTION 13: REPAIRS AND MAINTENANCE
13.1 Tenant Repairs and Maintenance. Tenant shall, at its expense,
throughout the Term, maintain and preserve, in first-class manner, the Premises,
the fixtures and appurtenances therein, reasonable wear and tear excepted.
Tenant shall also be responsible for all structural and non-structural repairs
and replacements, interior and exterior, ordinary and extraordinary, in and to
the Premises and the facilities and systems thereof (including, but not limited
to, the Premises' parking lot, and the electrical, mechanical, HVAC, and
plumbing systems). Tenant shall enter into a preventative maintenance and
service contract with a reputable service provider for maintenance of the HVAC
systems of the Premises. Without limiting the generality of the foregoing,
Tenant, at its expense, shall promptly replace or repair all scratched, damaged,
or broken doors and glass in and about the Premises and floor coverings in the
Premises and repair and maintain all sanitary and electrical fixtures therein;
provided, however, that all replacement materials and methods of replacement
shall be approved in writing by Landlord prior to installation. Any repairs or
replacements required to be made by Tenant to the mechanical, electrical,
sanitary, HVAC, or other systems of the Premises shall be performed by
appropriately licensed contractors approved by Landlord, which approval shall
not be unreasonably withheld. All such repairs or replacements shall be subject
to the supervision and control of Landlord or Agent, and all repairs and
replacements shall be made with materials of equal or better quality than the
items being repaired or replaced. (SEE SPECIAL STIPULATION 7)
13.2 Tenant Equipment. Tenant shall not place a load upon any floor of
the Premises that exceeds either the load per square foot that such floor was
designed to carry or that which is allowed by law. Business machines and
mechanical equipment belonging to Tenant that cause noise or vibrations that may
be transmitted to the structure of the Premises to such a degree as to be
objectionable or of concern to Landlord shall, at Tenant's expense, be placed
and maintained by Tenant in settings or cork, rubber or spring-type vibration
eliminators sufficient to eliminate such noise or vibration.
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SECTION 14: UTILITIES
14.1 Purchasing Utilities. Tenant shall purchase all utility services
from the utility or municipality providing such service; shall provide for
scavenger, cleaning and extermination services as necessary; and shall pay for
such services when payments are due. Tenant shall be solely responsible for the
repair and maintenance of any meters necessary in connection with such services.
14.2 Use of Electrical Energy by Tenant. Tenant's use of electrical
energy in the Premises shall not, at any time, exceed the capacity of (i) any of
the electrical conductors and equipment in or otherwise servicing the Premises;
or (ii) the Premises' heating, ventilating and air-conditioning ("HVAC")
systems. The Building is separately metered.
SECTION 15: LANDLORD'S RIGHTS
15.1 Landlord's Rights of Access. Landlord, Agent and their respective
agents, employees and representatives shall have the right to enter and/or pass
through the Premises at any time or times during regular business hours (a) to
examine and inspect the Premises and to show them to actual and prospective
Superior Parties or prospective purchasers or mortgagees of the Premises or
providers of capital to Landlord and its affiliates and all consultants and
advisors relating thereto; and (b) to make such repairs, alterations, additions
and improvements in or to the Premises or its facilities and equipment as
Landlord is required or desires to make. Landlord and Agent shall be allowed to
take all materials into and upon the Premises that may be required in connection
therewith, without any liability to Tenant and without any reduction or
modification of Tenant's covenants and obligations hereunder provided however
Landlord will use its best efforts not to disrupt Tenant's business. During the
period of six (6) months prior to the Expiration Date (or at any time, if Tenant
has vacated or abandoned the Premises or is otherwise in default under this
Lease), Landlord and its agents may exhibit the Premises to prospective tenants.
In the exercise of each of the foregoing rights, Landlord shall give Tenant
reasonable prior notice of its entry, except in the case of emergency. Nothing
set forth above implies obligations of improvement beyond the Work Items per
Exhibit C. Landlord, Agent and their respective agents, employees and
representatives may enter the Premises at any time, without notice in the event
of an emergency.
15.2 Other Landlord Rights. Landlord and Agent shall have the following
rights exercisable, without notice and without liability to Tenant, for damage
or injury to persons, property or business and without being deemed an eviction
or disturbance of Tenant's use or possession of the Premises or giving rise to
any claim for setoff or abatement of Rent: (i) to designate and/or approve,
prior to installation, all types of signs; (ii) to sell or otherwise transfer
the Premises and assign and pass through all of Landlord's obligations hereunder
to the new owner; (iii) to have pass keys, access cards, or both, to the
Premises; and (iv) to decorate, remodel, repair, alter or otherwise prepare the
Premises for reoccupancy at any time after Tenant vacates or abandons the
Premises for more than thirty (30) consecutive days or with no intention of
reoccupying the Premises.
SECTION 16: NON-LIABILITY AND INDEMNIFICATION
16.1 Non-Liability. None of Landlord, Agent, Landlord Affiliates, any
other managing agent, Superior Parties, or their respective affiliates, owners,
partners, directors, officers, agents and employees shall be liable to Tenant
for any loss, injury, or damage, to Tenant or to any other person, or to its or
their property, irrespective of the cause of such injury, damage or loss, unless
caused by, or resulting from, the negligence of Landlord, Agent or their
respective agents, servants or employees in the operation or maintenance of the
Premises (subject, however, to the doctrine of comparative negligence in the
event of negligence on the part of Tenant or any of its contractors). Further,
none of Landlord, Agent, any other managing agent, Superior Parties, or their
respective partners, directors, officers, agents and employees shall be liable
(a) for any such damage caused by other persons in, upon or about the Premises,
or caused by operations in construction of any private, public or quasi-public
work, unless caused by the negligence of Landlord, Agent or their respective
agents or employees; or (b) with respect to matters for which Landlord is
liable, for consequential or indirect damages purportedly arising out of any
loss of use of the Premises or any equipment or facilities therein by Tenant or
any person claiming through or under Tenant.
16.2 Tenant Indemnification. Tenant hereby indemnifies, defends, and
holds Landlord and all Landlord Affiliates harmless from and against any and all
claims, judgments, liens, causes of action, liabilities, damages, costs, losses
and expenses (including, but not limited to reasonable legal, engineering and
consulting fees of engineers, attorneys and consultants selected by Landlord)
arising from or in connection with (a) the conduct or management of the Premises
or any business therein, or any work or Alterations done, or any condition
created (other than by Landlord) in or about the Premises during either or both
of the Term and the period of time, if any, prior to the Commencement Date that
Tenant may have been given access to the Premises, including any and all
mechanics and other liens and encumbrances; (b) any act, omission or negligence
of Tenant or any of its subtenants or licensees or their partners, directors,
officers, agents, employees, invitees or contractors; (c) any accident, injury
or damage whatsoever (unless caused by Landlord's gross negligence) occurring
in, at or upon the Premises; (d) any breach or default by Tenant in the full and
prompt payment and performance of Tenant's obligations under this Lease; (e) any
breach by Tenant of any of its warranties and representations under this Lease;
and (f) any actions necessary to protect Landlord's interest under this Lease in
a bankruptcy proceeding or other proceeding under the Bankruptcy Code. In case
any action or proceeding is brought against Landlord or any Landlord Affiliate
by reason of any such claim, Tenant, upon notice from any or all of Landlord,
Agent or any Superior Party, shall resist and defend such action or proceeding
by counsel reasonably satisfactory to, or selected by, Landlord or such Superior
Lessor or Superior Mortgagee. Tenant's obligations under this Section 16.2 shall
survive the termination of this Lease for any reason. (SEE SPECIAL STIPULATION
8)
16.3 Force Majeure. The obligations of Tenant hereunder shall not be
affected, impaired or excused, and Landlord shall have no liability whatsoever
to Tenant, with respect to any act, event or circumstance arising out of (a)
Landlord's failure to fulfill, or delay in fulfilling any of its obligations
under this Lease by reason of labor dispute, governmental preemption of property
in connection with a public emergency or shortages of fuel, supplies, or labor,
or any other cause, whether similar or dissimilar, beyond Landlord's reasonable
control; or (b) any failure or defect in the supply, quantity or character of
utilities furnished to the Premises, or by reason of any requirement, act or
omission of any public utility or others serving the Premises beyond Landlord's
reasonable control. Tenant shall not hold Landlord or Agent liable for any
latent defect in the Premises, nor shall Landlord be liable for injury or damage
to person or property caused by fire, or theft, or resulting from the operation
of heating or air conditioning or lighting apparatus, or from falling plaster,
or from steam, gas, electricity, water, rain, snow, ice, or
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dampness, that may leak or flow from any part of the Premises, or from the
pipes, appliances or plumbing work of the same. Tenant agrees that under no
circumstances shall Landlord or Agent be liable to Tenant or any third party for
any loss of, destruction of, damage to or shortage of any property; including,
but not limited to, Tenant's Property.
16.4 Limitation of Liability. Notwithstanding anything to the contrary contained
in this Lease, the liability of Landlord (and of any Successor Landlord
hereunder) to Tenant shall be limited to the interest of Landlord in the
Premises, and Tenant agrees to look solely to Landlord's interest in the
Premises for the recovery of any judgment or award against Landlord, it being
intended that Landlord shall not be personally liable for any judgment or
deficiency. In addition, Tenant acknowledges that Agent is acting solely in its
capacity as agent for Landlord and, shall not be liable for any obligations,
liabilities, losses or damages arising out of or in connection with this Lease,
all of which are expressly waived by Tenant.
SECTION 17: DAMAGE OR DESTRUCTION
17.1 Notification. Tenant shall give prompt notice to Landlord and
Agent of (a) any occurrence in or about the Premises for which Landlord or Agent
might be liable, (b) any fire or other casualty in the Premises, (c) any damage
to, or defect in, the Premises, for the repair of which Landlord or Agent might
be responsible, and (d) any damage to or defect in any part or appurtenance of
the Premises' sanitary, electrical, HVAC, elevator or other systems located in
or passing through the Premises or any part thereof.
17.2 Repair Provisions. Subject to the provisions of Section 17.4
below, if the Premises are damaged by fire or other insured casualty, Landlord
shall repair or cause Agent to repair the damage and restore and rebuild the
Premises (except for Tenant's Property) with reasonable dispatch to
substantially the same condition they were in immediately prior to the casualty
after (a) notice to it of the damage or destruction and (b) the collection of
the insurance proceeds attributable to such damage, and Tenant shall repair the
damage to and restore and repair Tenant's Property, with reasonable dispatch
after such damage or destruction. Such work by Tenant shall be deemed
Alterations for the purposes of this Lease.
17.3 Rental Abatement. If (a) the Premises are damaged by fire or other
casualty thereby causing the Premises to be untenantable or (b) the Premises are
partially damaged by fire or other casualty, the Rent shall be equitably reduced
as to such portion of the Premises as is rendered untenantable.
17.4 Total Destruction. If the Premises shall be totally destroyed by
fire or other casualty, or if the Premises shall be so damaged by fire or other
casualty that (in the opinion of a reputable contractor or architect designated
by Landlord) (i) its repair or restoration requires more than one hundred eighty
(180) days or (ii) such repair or restoration requires the expenditure of more
than fifty percent (50%) of the full insurable value of the Premises immediately
prior to the casualty or (iii) the damage is less than the amount stated in (ii)
above, but is more than 25% and occurs during the last two (2) years of Lease
Term, Landlord and Tenant shall each have the option to terminate this Lease
within five (5) days after said contractor or architect delivers written notice
of its opinion to Landlord and Tenant, but in all events prior to the
commencement of any restoration of the Premises by Landlord. In such event, the
termination shall be effective as of the 180th date after the date on which the
casualty occurs. If (A) any Superior Party or other party entitled to the
insurance proceeds fails to make such proceeds available to Landlord in an
amount sufficient for restoration of the Premises less any applicable
deductibles, or (B) the issuer of any casualty insurance policies on the
Premises fails to make available to Landlord sufficient proceeds for restoration
of the Premises less any applicable deductibles, then Landlord may, at
Landlord's sole option, terminate this Lease, effective as of the one hundred
eightieth (180th) day after such casualty, by giving Tenant written notice to
such effect within one hundred eighty (180) days after the date of the casualty.
For purposes of this Section 17.4 only, "full insurable value" shall mean
replacement cost, less the cost of footings, foundations and other structures
below grade.
17.5 Repair or Restoration. Subject to the provisions of Section 17.2
and 17.4 above, Tenant shall not be entitled to terminate this Lease and no
damages, compensation or claim shall be payable by Landlord for purported
inconvenience, loss of business or annoyance arising from any repair or
restoration of any portion of the Premises pursuant to this Section. Landlord or
Agent shall use its diligent, good faith efforts to make such repair or
restoration promptly and in such manner as not to unreasonably interfere with
Tenant's use and occupancy of the Premises, but Landlord or Agent shall not be
required to do such repair or restoration work except during normal business
hours of business days.
17.6 Liability of Tenant. Notwithstanding any of the foregoing
provisions of this Section, if by reason of any act or omission on the part of
Tenant or any of its subtenants or its or their partners, directors, officers,
servants, employees, agents, or contractors, Landlord, any Superior Party, or
other appropriate party shall be unable to collect all of the insurance proceeds
(including, without limitation, rent insurance proceeds) applicable to damage or
destruction of the Premises by fire or other casualty (the "Insurance
Proceeds"), then, without prejudice to any other remedies that may be available
against Tenant, there shall be no abatement or reduction of the Rent
notwithstanding lack of usability. Further, and to the extent that, as a result
of or due to or because of any act or omission by any or all of Tenant, its
agents, employees, invitees and representatives, Landlord, any Superior Party or
any other appropriate party is unable to collect all of the Insurance Proceeds,
then Tenant shall be liable to Landlord for the payment of an amount equal to
that portion of the Insurance Proceeds that Landlord, any Superior Party or any
other appropriate party is unable to collect.
SECTION 18: EMINENT DOMAIN
18.1 Total Condemnation. If, in Landlord's opinion, the whole of the
Premises, or if any part of the Premises that materially affects Tenant's use
and occupancy of the Premises, shall be taken by condemnation or in any other
manner for any public or quasi-public use or purpose, Tenant shall have the
option to terminate this Lease and the term and estate hereby granted shall
terminate as of the date of vesting of title on such taking (herein called "Date
of the Taking"), and the Rent shall be prorated and adjusted as of such date.
18.2 Award. Landlord shall be entitled to receive the entire award or
payment in connection with any taking; provided, however, Tenant shall have the
right to separately pursue, against the condemning authority, an award in
respect of the loss, if any, to leasehold improvements or other interest of
Tenant in the Premises paid for by Tenant, without any credit or allowance from
Landlord and further provided that such separate award does not diminish or
interfere with Landlord's pursuit of
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its own award.
18.3 Compensation to Tenant for Temporary Use. If the temporary use or
occupancy of all or any part of the Premises shall be taken by condemnation or
in any other manner for any public or quasi-public use or purpose during the
Term, Tenant shall be entitled, except as hereinafter set forth, to receive that
portion of the award or payment for such taking which represents compensation
for the use and occupancy of the Premises, for the taking of Tenant's Property
and for moving expenses, and Landlord shall be entitled to receive that portion
that represents reimbursement for the cost of restoration of the Premises.
Unless Tenant elects to terminate this Lease pursuant to Section 18.1, then this
Lease shall be and remain unaffected by such taking, and Tenant shall continue
to be responsible for all of its obligations hereunder insofar as such
obligations are not affected by such taking and shall continue to pay, in full,
the Rent as prorated following such taking when due. If the period of temporary
use or occupancy shall extend beyond the Expiration Date, that part of the award
that represents compensation for the use and occupancy of the Premises (or a
part thereof) shall be prorated between Landlord and Tenant so that Tenant shall
receive so much thereof as represents the period up to and including such
Expiration Date and Landlord shall receive so much thereof as represents the
period after such Expiration Date. All monies paid as, or as part of, an award
for temporary use and occupancy for a period beyond the date to which the Rent
have been paid shall be received, held and applied by Landlord as a trust fund
for payment of the Rent becoming due.
18.4 Partial or Temporary Taking. Subject to the rights of any Superior
Mortgagee or Superior Lessor, and other parties having rights to condemnation
proceeds, in the event of any taking of less than the whole of the Premises,
which taking does not result in termination of this Lease, or in the event of a
taking for a temporary use or occupancy of all or any part of the Premises, or
other partial taking of the Premises, that does not result in a termination of
this Lease: (a) Landlord, at its expense, and provided that a condemnation award
or awards shall be sufficient for the purpose, shall proceed with reasonable
diligence to repair the remaining parts of the Premises (other than those parts
of the Premises that are Tenant's Property) to substantially their former
condition, to the extent that the same is feasible (subject to those changes
which Landlord reasonably deems desirable, and to building and other
governmental codes and regulations) and so as to constitute a complete and
tenantable Premises, and (b) Tenant, at its expense, and whether or not any
award or awards shall be sufficient for the purpose, shall proceed with
reasonable diligence to repair Tenant's Property, to substantially its former
condition, to the extent feasible, subject to such reasonable changes as
Landlord and Tenant shall agree upon, in writing. Such work by Tenant shall be
deemed Alterations. Furthermore, in the event of a partial taking of the
Premises that does not result in a termination of this Lease, the Base Rent due
hereunder shall be reduced in a proportionate amount, based upon the proportion
that the area that has been taken bears to the total area of the Premises. Such
reduction shall be effective from the date on which the partial taking occurs
until the date, if any, on which the partial taking terminates and the Premises
have been restored in accordance with the terms of this Lease.
SECTION 19: SURRENDER AND HOLDOVER
On the last day of the Term, or upon any earlier termination of this
lease, or upon any re-entry by Landlord upon the Premises, (a) Tenant shall quit
and surrender the Premises to Landlord "broom-clean" and in good order,
condition and repair, except for ordinary wear and tear and such damage or
destruction as Landlord is required to repair or restore under this Lease, and
(b) Tenant shall remove all of Tenant's Property therefrom, except as otherwise
expressly provided in this Lease. The obligations imposed under the preceding
sentence shall survive the termination or expiration of this Lease. If Tenant
remains in possession after the Expiration Date hereof or after any earlier
termination date of this Lease or of Tenant's right to possession: (a) Tenant
shall be deemed a tenant- at-sufferance; (b) Tenant shall pay one hundred fifty
percent (150%) of the Rent last prevailing hereunder, and also shall pay all
direct damages sustained by Landlord, by reason of such remaining in possession
after the expiration or termination of this Lease; and (c) there shall be no
renewal or extension of this Lease by operation of law; or, at the sole option
of Landlord expressed by written notice to Tenant, but not otherwise, such
holding over shall constitute a renewal of this Lease for a period of one (1)
year on the same terms and conditions as provided in this Lease. The provisions
of this Section 19 shall not constitute a waiver by Landlord of any re-entry
rights of Landlord provided hereunder or by law. The inclusion of the preceding
sentence in this Lease shall in no event be construed as Landlord's consent for
Tenant to hold over. Tenant shall also be liable to Landlord for all damage
(including consequential damages) which Landlord suffers because of any holding
over by Tenant, and Tenant shall indemnify Landlord against all claims made by
any other tenant or prospective tenant against Landlord resulting from delay by
Landlord in delivering possession of the Premises to such other tenant or
prospective tenant. The provisions of this Section 19 shall survive the
expiration or earlier termination of this Lease.
SECTION 20: EVENTS OF DEFAULT
20.1 Bankruptcy of Tenant. It shall be a default by Tenant under this
Lease if Tenant makes an assignment for the benefit of creditors, or files a
voluntary petition under any state or federal bankruptcy or insolvency law , or
an involuntary petition alleging an act of bankruptcy or insolvency is filed
against Tenant under any state or federal bankruptcy or insolvency law (and any
such involuntary proceeding is not permanently discharged, dismissed, stayed or
vacated, as the case may be within sixty (60) days of commencement), or whenever
a petition is filed by or against Tenant under the reorganization provisions of
the United States Bankruptcy Code or under the provisions of any law or like
import, or whenever a petition shall be filed by Tenant under the arrangement
provisions of the United States Bankruptcy Code or similar law, or whenever a
receiver of Tenant, or of, or for, the property of Tenant shall be appointed, or
Tenant admits it is insolvent or is not able to pay its debts as they mature.
20.2 Default Provisions. Each of the following shall constitute a
default by Tenant under this Lease: (a) if Tenant fails to pay Rent or any other
payment when due hereunder or within any applicable grace periods; or (b) if
Tenant fails, whether by action or inaction, to timely comply with, or satisfy,
any or all of the obligations imposed on Tenant under this Lease for a period of
thirty (30) days after Landlord's delivery to Tenant of written notice of such
default under this subsection 20.2(b); provided, however, that if the default
cannot, by its nature, be cured within such thirty (30) day period, but Tenant
commences and diligently pursues a cure of such default promptly within the
initial thirty (30) day cure period, then Landlord shall not exercise its
remedies under Section 21 unless such default remains uncured for more than
sixty (60) days after Landlord's initial delivery to Tenant of notice of such
default.
SECTION 21: REMEDIES
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21.1 Landlord's Cure Rights Upon Default of Tenant. If Tenant defaults
in the performance of any of its obligations under this Lease, Landlord, without
thereby waiving such default, may (but shall not be obligated to) perform the
same for the account, and at the expense of, Tenant upon compliance with any
notice requirements and cure periods set forth in Subsection 21.2.
21.2 Landlord's Remedies. Upon the occurrence of any of the aforesaid
events of default, Landlord shall have the option to pursue any one or more of
the following remedies without any notice or demand whatsoever: (i) terminate
this Lease, in which event Tenant shall immediately surrender the Premises to
Landlord and if Tenant fails to do so, Landlord may without prejudice to any
other remedy which it may have for possession or arrearages in Rent, enter upon
and take possession of the Premises and expel or remove Tenant and any other
person who may be occupying the Premises or any part thereof, by force, if
necessary, without being liable for prosecution or any claim of damages
therefor; Tenant hereby agreeing to pay to Landlord on demand the amount of all
loss and damage which Landlord may suffer by reason of such termination, whether
through inability to relet the Premises on satisfactory terms or otherwise; (ii)
terminate Tenant's right of possession (but not this Lease) and enter upon and
take possession of the Premises and expel or remove Tenant and any other person
who may be occupying the Premises or any part thereof, by entry (including the
use of force, if necessary), dispossessory suit or otherwise, without thereby
releasing Tenant from any liability hereunder, without terminating this Lease,
and without being liable for prosecution or any claim of damages therefor and,
if Landlord so elects, make such alterations, and repairs as, in Landlord's
judgment, may be necessary to relet the Premises, and Landlord may, but shall be
under no obligation to do so, relet the Premises or any portion thereof in
Landlord's or Tenant's name (limited to the length of the original lease term),
but for the account of Tenant, for such term or terms (which may be for a term
extending beyond the Lease Term) and at such rental or rentals and upon such
other terms as Landlord may deem advisable, with or without advertisement, and
by private negotiations, and receive the rent therefor, Tenant hereby agreeing
to pay to Landlord the deficiency, if any, between all Rent reserved hereunder
and the total rental applicable to the Lease Term hereof obtained by Landlord
re-letting, and Tenant shall be liable for Landlord's expenses in restoring the
Premises and all costs incident to such re-letting, including broker's
commissions and lease assumptions, and in no event shall Tenant be entitled to
any rentals received by Landlord in excess of the amounts due by Tenant
hereunder; or (iii) enter upon the Premises by force, if necessary, without
being liable for prosecution or any claim of damages therefor, and do whatever
Tenant is obligated to do under the terms of this Lease; and Tenant agrees to
reimburse Landlord on demand for any expenses including, without limitation,
reasonable attorneys' fees which Landlord may incur in thus effecting compliance
with Tenant's obligations under this Lease and Tenant further agrees that
Landlord shall not be liable for any damages resulting to Tenant from such
action. If this Lease is terminated by Landlord as a result of the occurrence of
an event of default, Landlord may declare due and payable immediately an amount
determined as follows: (x) the entire amount of Rent and other charges and
assessments which would have become due and payable during the remainder of the
Lease Term, discounted to present value by using a discount factor of eight
percent (8%) per annum, plus (y) all of Landlord's costs and expenses
(including, without limitation, Landlord's expenses in restoring the Premises
and all costs relating to such reletting, including broker's commissions and
lease assumptions) reasonably incurred in connection with or related to the
reletting of the Premises, minus (z) the market rental value of the Premises for
the remainder of the Lease Term, based on Landlord's reasonable determination of
both future rental value and the probability of reletting the Premises for all
or part of the remaining Lease Term, discounted to present value by using a
discount factor of eight percent (8%) per annum. Such payment shall not
constitute a penalty or forfeiture but shall constitute liquidated damages for
Tenant's failure to comply with the terms and provisions of this Lease (Landlord
and Tenant agreeing that Landlord's exact damages in such event are impossible
to ascertain and that the amount set forth above is a reasonable estimate
thereof). For purposes of determining what could be collected by Landlord by
reletting under this subsection, Landlord is not required to relet when other
comparable space in the Building is available. The term "remaining Lease Term"
as used in this subsection shall mean the period which otherwise would have (but
for the termination of this Lease) constituted the balance of the Lease Term
from the date of the termination of this Lease.
21.3 Rights of Landlord. Pursuit of any of the foregoing remedies shall
not preclude pursuit of any other remedy herein provided or any other remedy
provided by law or at equity, nor shall pursuit of any remedy herein provided
constitute an election of remedies thereby excluding the later election of an
alternate remedy, or a forfeiture or waiver of any Rent or other charges and
assessments payable by Tenant and due to Landlord hereunder or of any damages
accruing to Landlord by reason of violation of any of the terms, covenants,
warranties and provisions herein contained. No reentry or taking possession of
the Premises by Landlord or any other action taken by or on behalf of Landlord
shall be construed to be an acceptance of a surrender of this Lease or an
election by Landlord to terminate this Lease unless written notice of such
intention is given to Tenant. Forbearance by Landlord to enforce one or more of
the remedies herein provided upon an event of default shall not be deemed or
construed to constitute a waiver of such default. In determining the amount of
loss or damage which Landlord may suffer by reason of termination of this Lease
or the deficiency arising by reason of any reletting of the Premises by Landlord
as above provided, allowance shall be made for the expense of repossession.
Tenant agrees to pay to Landlord all costs and expenses incurred by Landlord in
the enforcement of this Lease, including without limitation, the reasonable fees
of Landlord's attorneys. Any and all costs, expenses and disbursements, of any
kind or nature, incurred by Landlord or Agent in connection with the enforcement
of any and all of the terms and provisions of this Lease, including reasonable
attorneys' fees (through all appellate proceedings), shall be due and payable
(as Additional Rent) upon Landlord's submission of an invoice therefor. All sums
advanced by Landlord or Agent on account of Tenant under this Section, or
pursuant to any other provision of this Lease, and all Rent, if delinquent or
not paid by Tenant and received by Landlord when due hereunder, shall bear
interest at the rate of five percent (5%) per annum above the "prime" or
"reference" or "base" rate of interest publicly announced as such, from time to
time, by The First National Bank of Chicago, from the due date thereof until
paid, and such interest shall be and constitute Additional Rent and be due and
payable upon Landlord's or Agent's submission of an invoice therefor. Suit or
suits for the recovery of such damages, or any installments thereof, may be
brought by Landlord from time to time at its election, and nothing contained
herein shall be deemed to require Landlord to postpone suit until the Expiration
Date, nor limit or preclude recovery by Landlord against Tenant of any sums or
damages to which, in addition to the damages particularly provided above,
Landlord may lawfully be entitled by reason of any default hereunder by Tenant.
The various rights, remedies and elections of Landlord reserved, expressed or
contained herein are cumulative and no one of them shall be deemed to be
exclusive of the others or of such other rights, remedies, options or elections
as are now or may hereafter be conferred upon Landlord by law.
21.4 Event of Bankruptcy. In addition to, and in no way limiting the
other remedies set forth herein, Landlord and Tenant agree that if Tenant ever
becomes the subject of a voluntary or involuntary bankruptcy, reorganization,
composition, or other similar type proceeding under the federal bankruptcy laws,
as now enacted or hereinafter amended, then:
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<PAGE> 11
(a) "Adequate assurance of future performance" by Tenant
and/or any assignee of Tenant pursuant to Bankruptcy Code Section 365
will include (but not be limited to) payment of an additional/new
security deposit in the amount of three (3) months of the then-current
Net Base Rent payable hereunder.
(b) Any person or entity to which this Lease is assigned
pursuant to the provisions of the Bankruptcy Code, shall be deemed,
without further act or deed, to have assumed all of the obligations of
Tenant arising under this Lease on and after the effective date of such
assignment. Any such assignee shall, upon demand by Landlord, execute
and deliver to Landlord an instrument confirming such assumption of
liability.
(c) Notwithstanding anything in this Lease to the contrary,
all amounts payable by Tenant to or on behalf of Landlord under this
Lease, whether or not expressly denominated as "Rent", shall constitute
"rent" for the purposes of Section 502(b)(6) of the Bankruptcy Code.
(d) If this Lease is assigned to any person or entity pursuant
to the provisions of the Bankruptcy Code, any and all monies or other
considerations payable or otherwise to be delivered to Landlord or
Agent (including Rent and other amounts hereunder), shall be and remain
the exclusive property of Landlord and shall not constitute property of
Tenant or of the bankruptcy estate of Tenant. Any and all monies or
other considerations constituting Landlord's property under the
preceding sentence not paid or delivered to Landlord or Agent shall be
held in trust by Tenant or Tenant's bankruptcy estate for the benefit
of Landlord and shall be promptly paid to or turned over to Landlord.
SECTION 22: BROKER
Tenant covenants, warrants and represents that the broker set forth in
Section 1.11(A) was the only broker to represent Tenant in the negotiation of
this Lease ("Tenant's Broker"). Landlord covenants, warrants and represents that
the broker set forth in Section 1.11(B) was the only broker to represent
Landlord in the negotiation of this Lease ("Landlord's Broker"). Landlord shall
be solely responsible for paying the commissions of Landlord's and Tenant's
Broker. Each party agrees to and hereby does defend, indemnify and hold the
other harmless against and from any brokerage commissions or finder's fees or
claims therefor by a party (other than Tenant's Broker and Landlord's Broker)
claiming to have dealt with the indemnifying party and all costs, expenses and
liabilities in connection therewith, including, without limitation, reasonable
attorneys' fees and expenses, for any breach of the foregoing. The foregoing
indemnification shall survive the termination of this Lease for any reason.
SECTION 23: ESTOPPEL CERTIFICATES
Tenant shall, from time to time and within ten (10) days after any
request by Landlord, execute and deliver to Landlord (and to any existing or
prospective mortgage lender, ground lessor, or purchaser designated by
Landlord), a statement: (i) 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); (ii) certifying the
dates to which the Rent has been paid; (iii) stating whether Landlord is in
default in performance of any of its obligations under this Lease, and, if so,
specifying each such default; (iv) stating whether any event has occurred which,
with the giving of notice or passage of time, or both, would constitute such a
default, and, if so, specifying each such event; and (v) stating whether any
rights of Tenant (e.g., options) have been waived. Any such statement delivered
pursuant hereto shall be deemed a representation and warranty to be relied upon
by the party requesting the certificate and by others with whom Landlord may be
dealing, regardless of independent investigation. Tenant also shall include in
any such statements such other information concerning this Lease as Landlord or
Agent may reasonably request including, but not limited to, the amount of Rent
under this Lease, and whether Landlord has completed all (if any) improvements
to the Premises required under this Lease.
SECTION 24: HAZARDOUS SUBSTANCES
24.1 Definitions. For purposes of this Section 24, "hazardous
substance" means any matter regulated under the Resources Conservation Recovery
Act ("RCRA"), 42 U.S.C. Section 6901 et seq., the Comprehensive Environmental
Response, Compensation and Liability Act ("CERCLA"), 52 U.S.C. Section 9601 et
seq., applicable state or local law, or any substance or matter giving rise to
liability under common law theory based on nuisance or strict liability (the
foregoing laws being referred to herein as "Environmental Laws"). For purposes
of this Section 24, "Landlord's Environmental Liability" means: any and all
losses, liabilities, obligations, penalties, claims, fines, lost profits,
demands, litigation, defenses, costs, judgments, suits, proceedings, damages
(including consequential, punitive and exemplary damages), disbursements or
expenses of any kind or nature whatsoever (including reasonable attorneys' fees
at trial and appellate levels and experts' fees and disbursements and expenses
incurred in investigating, defending against, settling or prosecuting any suit,
litigation, claim or proceeding) which may at any time be either directly or
indirectly imposed upon, incurred by or asserted or awarded against Landlord or
any of Landlord's parent and subsidiary corporations and their affiliates,
shareholders, directors, officers, employees, and agents in connection with or
arising from: (i) any hazardous substance used, exposed, emitted, released,
discharged, generated, manufactured, sold, transported, handled, stored,
treated, reused, presented, disposed of or recycled on, in or under all or any
portion of the Property, or any surrounding areas; (ii) any misrepresentation,
inaccuracy or breach of any warranty, covenant or agreement contained or
referred to in this Section 24; (iii) any violation, liability or claim of
violation or liability under any Environmental Laws; or (iv) the imposition of
any lien for damages caused by, or the recovery of any costs incurred for the
cleanup of, any release or threatened release of hazardous substance.
24.2 Prohibition. Tenant shall not conduct or authorize the generation,
transportation, storage, use, treatment or disposal on or in the Premises of any
hazardous substance without prior written authorization by Landlord, which
authorization may be given or withheld in Landlord's sole and absolute
discretion, and Tenant's failure to comply with the provisions of this Section
24.2 shall constitute a default under this Lease. Notwithstanding the preceding
sentence, Landlord hereby authorizes Tenant to use and store reasonable
quantities of the following in the Premises, in accordance with all applicable
laws and regulations: paints; oils; material utilized in printing operations;
and materials utilized in the normal course of Tenant's repair and maintenance
of the Premises. No such purported authorization shall be binding on Landlord
unless signed by Landlord and not solely by Agent.
24.3 Permitted Activities. If Landlord expressly authorizes Tenant, in
writing, to generate, transport, store, treat
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or dispose of any hazardous substance on the Premises: (i) Tenant shall, at its
own cost, comply with all laws (federal, state or local) relating to hazardous
substance, including, but not limited to, RCRA and CERCLA; (ii) Tenant shall
promptly provide Agent copies of all communications, permits or agreements with
any governmental authority or agency (federal, state or local) or any private
entity relating in any way to the presence, release, threat of release,
placement on or in the Premises, or the generation, transportation, storage,
use, treatment, or disposal at the Premises, of any hazardous substance; (iii)
Landlord, Agent and their respective agents and employees shall have the right
to enter the Premises and/or conduct appropriate tests for the purposes of
ascertaining Tenant compliance with all applicable laws, rules or permits
relating in any way to the presence of hazardous substances on the Premises; and
(iv) Upon written request by Landlord or Agent, Tenant shall provide Landlord
with the results of appropriate tests of air, water or soil to demonstrate that
Tenant complies with all applicable laws, rules or permits relating in any way
to the presence of hazardous substances on the Premises or any portion thereof.
24.4 Remedial Action. If the presence, release, threat of release,
placement on or in the Premises or any portion thereof, or the generation,
transportation, storage, use, treatment, or disposal at the Premises or any
portion thereof of any hazardous substance: (i) gives rise to liability
(including, but not limited to, a response action, remedial action, or removal
action) under RCRA, CERCLA, applicable state law, or any common law theory based
on nuisance or strict liability, (ii) causes an adverse public health effect, or
(iii) pollutes, or threatens to pollute, the environment, Tenant, at its sole
cost and expense, shall promptly take any and all remedial and removal action
necessary to clean up the Premises or any portion thereof, and mitigate exposure
to liability arising from the hazardous substance, regardless whether required
by law.
24.5 Indemnity and Release. Tenant shall and does hereby protect,
indemnify, defend (at trial and appellate levels and with counsel, experts and
consultants acceptable to Landlord and at Tenant's sole cost) and hold Landlord
and its Affiliates free and harmless from and against any loss, cost or expense
incurred by Landlord and resulting wholly or in part from Tenant's breach of its
obligations under this Section 24 (collectively, "Tenant's Indemnification
Obligations"). Tenant's Indemnification Obligations shall survive in perpetuity
with respect to any Landlord's Environmental Liability. Tenant and its
successors and assigns hereby waive, release and agree not to make any claim or
bring any cost recovery action against Landlord under or with respect to any
Environmental Laws, except as otherwise described in Special Stipulation 9 on
Exhibit E attached hereto. Tenant's obligation to Landlord under this indemnity
shall likewise be without regard to fault on the part of Tenant or Landlord with
respect to the violation or condition which results in liability to Landlord or
Agent. The foregoing indemnity and Tenant's other obligations under this Section
24 shall survive the expiration or termination of this Lease for any reason.
(SEE SPECIAL STIPULATION 9)
SECTION 25: MISCELLANEOUS
25.1 Merger. All prior understandings and agreements between the
parties are merged in this Lease, which alone fully and completely expresses the
agreement of the parties. No agreement shall be effective to modify this Lease,
in whole or in part, unless such agreement is in writing, and is signed by the
party against whom enforcement of said change or modification is sought.
25.2 Notices. Any notice required to be given by either party pursuant
to this Lease, shall be in writing and shall be deemed to have been properly
given, rendered or made only if personally delivered or if sent by Federal
Express or other comparable commercial overnight delivery service, addressed to
the other party at the addresses set forth below (or to such other address as
Landlord or Tenant may designate to each other from time to time by written
notice), and shall be deemed to have been given, rendered or made on the day so
delivered or on the first business day after having been deposited with the
courier service:
<TABLE>
<S> <C>
If to Landlord: First Industrial, L.P.
311 South Wacker Drive
Suite 4000
Chicago, Illinois 60606
Attn: Michael W. Brennan
With a copy to: First Industrial Realty Trust, Inc.
3101 Towercreek Parkway
Suite 520
Atlanta, Georgia 30339
Attn: Mark Dishaw
and a copy to: Barack Ferrazzano Kirschbaum Perlman & Nagelberg
333 West Wacker Drive
Suite 2700
Chicago, Illinois 60606
Attn: Howard Nagelberg, Esq. and Suzanne Bessette-Smith, Esq.
and a copy to: Glass, McCullough, Sherrill & Harrold, LLP
1409 Peachtree Street, N.E.
Atlanta, Georgia 30309
Attn: Peter B. Glass, Esq.
If to Tenant: Nantucket Industries, Inc.
510 Broadhollow Road Suite 300
Mellville, NY 11747-3606
Attn: Steven Samberg, Chief Executive Officer
and a copy to: Sally E. Michael
Lane, Altman & Owens LLP
101 Federal St.
Boston, MA 02110
</TABLE>
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<PAGE> 13
25.3 Non-Waiver. The failure of either party to insist, in any one or
more instances, upon the strict performance of any one or more of the
obligations of this Lease, or to exercise any election herein contained, shall
not be construed as a waiver or relinquishment for the future of the performance
of such one or more obligations of this Lease or of the right to exercise such
election, but the Lease shall continue and remain in full force and effect with
respect to any subsequent breach, act or omission. The receipt and acceptance by
Landlord or Agent of Rent with knowledge of breach by Tenant of any obligation
of this Lease shall not be deemed a waiver of such breach.
25.4 Legal Costs. Any party in breach or default under this Lease (the
"Defaulting Party") shall reimburse the other party (the "Nondefaulting Party")
upon demand for any reasonable costs or expenses that the Nondefaulting Party
incurs in connection with the breach or default, regardless whether suit is
commenced or judgment entered. Such costs shall include reasonable legal fees
and costs incurred for the negotiation of a settlement, enforcement of rights or
otherwise. Furthermore, in the event of litigation, the court in such action
shall award to the party in whose favor a judgment is entered, a reasonable sum
as attorneys' fees and costs, which sum shall be paid by the losing party.
Tenant shall pay Landlord's reasonable attorneys' fees incurred in connection
with Tenant's request for Landlord's consent under provisions of this Lease
governing assignment and subletting, or in connection with any other act which
Tenant proposes to do and which requires Landlord's consent.
25.5 Parties Bound. Except as otherwise expressly provided for in this
Lease, this Lease shall be binding upon, and inure to the benefit of, the
successors and assignees of the parties hereto. Tenant hereby releases Landlord
named herein from any obligations of Landlord for any period subsequent to the
conveyance and transfer of Landlord's ownership interest in the Premises. In the
event of such conveyance and transfer, Landlord's obligations shall thereafter
be binding upon each transferee (whether Successor Landlord or otherwise). No
obligation of Landlord shall arise under this Lease until the instrument is
signed by, and delivered to, both Landlord and Tenant.
25.6 Recordation of Lease. Tenant shall not record or file this Lease
(or any memorandum hereof) in the public records of any county or state unless
on Landlord's standard form with Landlord's prior written consent which shall
not be unreasonably withheld.
25.7 Survival of Obligations. Upon the expiration or other termination
of this Lease, neither party shall have any further obligation or liability to
the other except as otherwise expressly provided in this Lease and except for
such obligations as, by their nature or under the circumstances, can only be, or
by the provisions of this Lease, may be performed after such expiration or other
termination. The provisions of Sections 2, 3, 12, 16, 19, 22, and 24 shall
survive any termination of this Lease.
25.8 Governing Law; Construction. This Lease shall be governed by and
construed in accordance with the laws of the state in which the Premises are
located. If any provision of this Lease shall be invalid or unenforceable, the
remainder of this Lease shall not be affected but shall be enforced to the
extent permitted by law. The captions, headings and titles in this Lease are
solely for convenience of reference and shall not affect its interpretation.
This Lease shall be construed without regard to any presumption or other rule
requiring construction against the party causing this Lease to be drafted. Each
covenant, agreement, obligation, or other provision of this Lease to be
performed by Tenant, shall be construed as a separate and independent covenant
of Tenant, not dependent on any other provision of this Lease. All terms and
words used in this Lease, regardless of the number or gender in which they are
used, shall be deemed to include any other number and any other gender as the
context may require.
25.9 Time. Time is of the essence of this Lease. If the time for
performance hereunder falls on a Saturday, Sunday or a day that is recognized as
a holiday in the state in which the Premises are located, then such time shall
be deemed extended to the next day that is not a Saturday, Sunday or holiday in
said state.
25.10 Authority of Tenant. If Tenant is a corporation, partnership,
association or any other entity, it shall deliver to Landlord, concurrently with
the delivery to Landlord of an executed Lease, certified resolutions of Tenant's
directors or other governing person or body (i) authorizing execution and
delivery of this Lease and the performance by Tenant of its obligations
hereunder and (ii) certifying the authority of the party executing the Lease as
having been duly authorized to do so.
25.11 Joint and Several Liability. All parties signing this Lease as
Tenant shall be jointly and severally liable for all obligations of Tenant
hereunder.
25.12 Homestead. Tenant waives all homestead rights and exemptions
which it may have under any law as against any obligation owing under this
Lease, and assigns to Landlord its homestead and exemptions to the extent
necessary to secure payment and performance of its covenants and agreements
hereunder.
25.13 Landlord's Lien. INTENTIONALLY OMITTED
25.14 No Estate. This Lease shall create the relationship of landlord
and tenant only between Landlord and Tenant and no estate shall pass out of
Landlord. Tenant shall have only an usufruct, not subject to levy and sale and
not assignable in whole or in part by Tenant except as herein provided.
25.15 Counterpart Execution. This Lease may be executed in counterpart
and, when all counterpart documents are executed, the counterparts shall
constitute a single binding instrument.
25.16 Riders. All Riders and Exhibits attached hereto and executed (or
initialed) both by Landlord and Tenant shall be deemed to be a part hereof and
hereby incorporated herein.
25.17 WAIVER OF TRIAL BY JURY. THE LANDLORD AND THE TENANT, TO THE
FULLEST EXTENT THAT THEY MAY LAWFULLY DO SO, HEREBY WAIVE TRIAL BY JURY IN ANY
ACTION OR PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY COURT ACTION BROUGHT BY
ANY PARTY TO THIS LEASE WITH RESPECT TO THIS LEASE, THE PREMISES, OR ANY OTHER
MATTER RELATED TO THIS LEASE OR THE
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<PAGE> 14
PREMISES.
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease
as of the day and year first above written.
LANDLORD: First Industrial, L.P.,
a Delaware limited partnership
By: First Industrial Realty Trust, Inc.,
a Maryland corporation, its general partner
/s/ Mark Dishaw
By: _________________________________________
Regional Director
Its: ________________________________
TENANT: Nantucket Industries, Inc.,
a Delaware corporation
/s/ Stephen M. Samberg
By: _________________________________________
CEO
Its: ________________________________
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<PAGE> 15
LEASE EXHIBIT A
LEGAL DESCRIPTION
(Omitted)
15
<PAGE> 16
LEASE EXHIBIT B
RENTAL PAYMENTS
<TABLE>
<CAPTION>
Lease Period (months) Rental Rate Yearly Net Base Rent Monthly Net Base Rent
- --------------------- ----------- -------------------- ---------------------
<S> <C> <C> <C>
01-12 $2.65 p/rsf $188,150.00 $15,679.00
13-24 $2.70 p/rsf $191,700.00 $15,975.00
25-36 $2.75 p/rsf $195,250.00 $16,271.00
37-48 $2.80 p/rsf $198,800.00 $16,567.00
49-60 $2.85 p/rsf $202,350.00 $16,863.00
</TABLE>
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LEASE EXHIBIT C
LANDLORD'S REPAIRS AND IMPROVEMENTS
Landlord agrees prior to the Commencement Date to provide the following
improvements at Landlord's cost and expense:
- - Repaint the office areas
- - Shampoo office carpet
- - Deliver warehouse in broom-swept condition
- - Remove the 4' high concrete spill retaining walls located in the back corner
of the warehouse and remove the piping which is hanging over this area
- - Replace the yellow-tinted bulbs in the warehouse light fixtures with
"white-type" bulbs of equal quality
- - Landlord agrees to deliver the HVAC, plumbing, warehouse doors, sprinkler, and
electrical systems in a good and working order. Landlord shall warrant these
systems for a period of ninety (90) days from the earlier of the Commencement
Date or the date Tenant takes possession of the Premises.
Under all circumstances, Tenant shall be responsible for the installation and
expense for any signage, telephone system, computer system, security system,
fire alarm system, and fire extinguishers.
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<PAGE> 18
LEASE EXHIBIT D
REQUIRED INSURANCE
(a) "All-Risk" Property and Loss of Income Coverage for Tenant's
Property. "All Risk (i) property insurance in an amount which is reasonable and
customary in the industry, and covering all of Tenant's Property (as defined in
Section 12.2 of this Lease), and (ii) business interruption insurance in an
amount sufficient to assure that Landlord shall recover the loss of any rental
income due and owing to Landlord from Tenant under the terms of this Lease,
which coverage shall provide such protection to Landlord for a period of not
less than twelve (12) consecutive months. The total amount of the deductible
required under each policy providing such coverage shall be no more than
$10,000.00 per loss. Landlord, Agent and any other parties designated by
Landlord (including, but not limited to, its beneficiary, its general and
limited partners, and Superior Parties) shall be included as loss payee(s).
(b) Liability Coverage. Commercial general public liability and
comprehensive automobile liability [and, if necessary to comply with any
conditions of this Lease, umbrella liability insurance] covering Tenant against
any claims arising out of liability for bodily injury and death and personal
injury and advertising injury and property damage occurring in and about the
Premises, and otherwise resulting from any acts and operations of Tenant, its
agents and employees, with limits of not less than total limits of $2,000,000.00
per occurrence and $5,000,000.00 annual general aggregate, per location. The
total amount of a deductible or otherwise self-insured retention with respect to
such coverage shall be not more than $10,000.00 per occurrence. Such insurance
shall include, inter alia: (i) "occurrence" rather than "claims made" policy
forms unless such "occurrence" policy forms are not available; (ii) any and all
liability assumed by Tenant under the terms of this Lease, to the extent such
insurance is available; (iii) premises medical-operations expenses in an amount
not less than $5,000.00 per person, per accident; (iv) a hostile fire
endorsement; (v) Landlord, Agent and any other parties designated by Landlord or
Agent (including, but not limited to, its beneficiary, its general and limited
partners, and Superior Mortgagees) shall be designated as Additional Insured(s)
with respect to (x) the Premises, and (y) all operations of Tenant, and (z) any
property and areas and facilities of Landlord used by Tenant, its employees,
invitees, customers or guests; and (vi) severability of insured parties and any
cross-liability exclusion deleted so that the protection of such insurance shall
be afforded to Landlord in the same manner as if separate policies had been
issued to each of the insured parties.
(c) Workers' Compensation Coverage. Workers' compensation and
employer's liability insurance in the state in which the Premises and any other
operations of Tenant are located and any other state in which Tenant or its
contractors or subcontractors may be subject to any statutory or other liability
arising in any manner whatsoever out of the actual or alleged employment of
others. The total limits of the employer's liability coverage (including
umbrella liability insurance) shall be not less than the amounts specified in
Subsection (b) above.
(d) Other Coverage. Such other policy or policies as are either: (i)
reasonably required of Landlord by any Superior Mortgagee or any other party
having any interest in the Premises; or (ii) deemed reasonably necessary by
Landlord; or (iii) required by insurers by reasons of a change in Tenant's use
of, or activities at, the Premises.
All insurance policies required under this lease exhibit shall: (i) be
issued by companies licensed to do business in the State in which the Premises
are located and acceptable to Landlord and any Superior Mortgagees and any other
party having any interest in the Premises; (ii) not be subject to cancellation
or material change or non-renewal without at least thirty (30) days' prior
written notice to Landlord and any other parties designated by Landlord (A) to
be loss payee(s) or additional insured(s) under the insurance policies required
from Tenant, or (B) to receive such notices; (iii) be deemed to be primary
insurance in relation to any other insurance maintained by Landlord or Agent;
and (iv) at the sole option and discretion of Landlord, include other
appropriate endorsements or extensions of coverage as would be required of
Landlord by any Superior Mortgagees or any other party having any interest in
the Premises.
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Lease Exhibit E
SPECIAL STIPULATIONS
These Special Stipulations are attached to and made an integral part of
that certain Industrial Building Lease between FIRST INDUSTRIAL, L.P., a
Delaware limited partnership ("Landlord") and NANTUCKET INDUSTRIES, INC., a
Delaware ("Tenant"), dated November __, 1997. In the event of any conflict
between the provisions of these Special Stipulations and any other provision of
the Lease, the provisions of these Special Stipulations shall govern and control
and shall supersede such other conflicting provisions of the Lease. Unless
otherwise indicated herein, capitalized terms utilized in these Special
Stipulations shall have the meanings to them in the Lease.
1. Additional Rent. Landlord shall provide Tenant with an itemized
invoice and copies of bills where available, for any Additional Rent payable
pursuant to Section 2.2 of the Lease. Tenant shall have twenty (20) days from
Tenant's receipt of such itemized invoices to pay Landlord the Additional Rent
in accordance of Section 2 of this Lease.
2. Taxes and Assessments. Tenant may contest in good faith and at its
expense the amount or validity of any Taxes that it is obligated to pay pursuant
to Section 3 of this Lease only after paying such tax or posting security that
Landlord reasonably requires in order to protect the Premises against loss or
forfeiture. Tenant is entitled to any refund of Taxes paid by Tenant as a result
of any successful contest. Landlord shall join in any contest undertaken by
Tenant in accordance with the foregoing at Tenant's expense if the provisions of
any law, rule or regulation at the time in effect require that the proceedings
be brought by or in the name of Landlord. The Land is a separate tax parcel.
Landlord has no actual knowledge of any new assessments or property tax
increases for the calendar year 1998.
3. Subordination of Lease. As a condition to any subordination of this
Lease, the mortgage holder shall execute a Subordination, Non-Disturbance and
Attornment Agreement in favor of Tenant in a form reasonably satisfactory to
Landlord and Tenant which shall state that Tenant's rights shall not be
disturbed upon foreclosure unless Tenant is in default of this Lease.
4. Assignment, Subletting and Mortgaging. Landlord may, as a prior
condition to considering any request for consent to an assignment or sublease,
require Tenant to obtain and submit current financial statements of any proposed
subtenant or assignee and such other financial documentation relative to the
proposed subtenant or assignee as Landlord may reasonably require. In the event
Landlord consents to an assignment or sublease, Tenant shall pay to Landlord all
reasonable legal fees and accounting costs incurred by Landlord as a result of
the assignment or sublease.
5. Compliance with Laws. Tenant may appeal in good faith and at its
expense Tenant's violation of any laws or requirement, as described in Section 9
of this Lease only after paying such expenses, fines or damages that are imposed
upon Landlord, Agent, or any Superior Lessee, Superior Lessor or Superior
Mortgagee or posting such security that Landlord reasonably requires in order to
protect the Premises against loss or forfeiture.
6. Insurance. During the Lease Term, Landlord shall insure the Building
on an "all risk" basis against damage with casualty, flood and commercial
general liability insurance, at full replacement cost, and with such deductibles
as Landlord reasonably deems appropriate. Notwithstanding any contribution by
Tenant to the cost of insurance premiums, as provided hereinabove, Landlord
shall not be required to carry insurance of any kind on Tenant's Property, and
Tenant hereby agrees that Tenant shall have no right to receive any proceeds
from any insurance policies carried by Landlord. Landlord shall pay and
pass-through to Tenant its pro rata share of all premiums for such insurance.
7. Landlord's Repairs. Landlord shall be responsible for the repair and
replacement of the roof. Except as otherwise provided in the Lease, Landlord
shall have no other repair, maintenance or replacement obligations with respect
to the Premises or this Lease.
8. Landlord Indemnification. Landlord hereby indemnifies, defends, and
holds Tenant harmless from and against any and all claims, judgments, liens,
causes of action, liabilities, damages, costs, losses and expenses, including
reasonable attorneys fees actually incurred, that may be asserted against Tenant
or that Tenant may sustain arising from the negligent or intentional acts or
omissions of Landlord, its agents or employees, or any breach of this Lease
except to the extent such claims, judgments, liens, causes of action,
liabilities, damages, costs, losses and expenses arise from the intentional or
negligent acts or omissions of Tenant or any of its any of its subtenants or
licensees or their partners, directors, officers, agents, employees, invitees or
contractors.
9. Hazardous Substances. (a) Notwithstanding anything to the contrary
in Section 24 of this Lease, Tenant shall not be responsible for the violation
of any Environmental Laws (i) caused by the migration of Hazardous Substances
onto the Land or the Premises, which originate from any other property and are
not caused by Tenant or (ii) caused by events which occur prior to the
Commencement Date (or the date Tenant takes possession of the Premises,
whichever is earlier) or after the Expiration Date (or the date Tenant vacates
the Premises, whichever is later).
(b) To Landlord's current actual knowledge, Landlord has received no
written notice of any proceeding or inquiry by any governmental agency or before
any court with respect to any Hazardous Substance affecting the Land, that the
Land is subject to any federal, state or local "superfund" lien or proceeding
for the cleanup, removal or remediation of any such Hazardous Substance from the
Land, or that the Land has been listed on any list of potential or verified
hazardous waste sites maintained by the United States, the State of Louisiana or
any administrative agency thereof.
(c) to Landlord's current actual knowledge, no Hazardous Substance has
been stored, processed or disposed of on, or released or discharged from or onto
the Land in a manner that violated applicable Environmental Laws;
10. Early Occupancy. Landlord shall permit Tenant access to the
Premises prior to the Commencement Date, for the purpose of moving furniture,
equipment and other personal property into the Premises and performing certain
improvements
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which have been approved by Landlord in writing. If Tenant occupies the Premises
prior to the Commencement Date, all of the provisions of this Lease will be in
effect from the beginning of the occupancy; however, Base Rent otherwise due
under this Lease will be abated up to the Commencement Date.
11. Renewal Option. In the event Tenant is not then in default of this
Lease, Tenant shall have the right to renew this Lease for one (1) five (5) year
term ("Renewal Term"). Tenant must exercise its option to renew by written
notice to Landlord at least six (6) months prior to the Expiration Date
("Renewal Notice") at the "market rate" to be mutually agreed upon by Landlord
and Tenant. If Tenant does not exercise its option to renew within the allotted
time period, Landlord may commence to show the demised Premises to prospective
tenants and may place upon the corridor or doors thereon one or more "For Rent"
signs of reasonable dimensions.
Whenever used herein, the term "market rate" shall mean a rental rate
equal to the then current market rate, for comparable space in other buildings
comparable to the Building in the greater Atlanta metropolitan area, taking into
account all relevant factors including, without limitation, the credit
worthiness of the tenant, the length of the term, all concessions and the size
and location of the Building.
12. Landlord's Default. In the event that Landlord shall default in the
performance of any of Landlord's obligations set forth in this Lease, and
Landlord does not commence the rectification of its default within thirty (30)
days of Landlord's receipt of Tenant's written notification of such default,
Tenant may pursue any and all legal and equitable remedies available to Tenant
under the laws of the State of Georgia.
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