SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) July 14, 1999
AEI REAL ESTATE FUND XV LIMITED PARTNERSHIP
(Exact Name of Registrant as Specified in its Charter)
State of Delaware
(State or other Jurisdiction of Incorporation or
Organization)
0-14089 93-0926134
(Commission File Number) (I.R.S. Employer
Identification No.)
1300 Minnesota World Trade Center, St. Paul, Minnesota 55101
(Address of Principal Executive Offices)
(651) 227-7333
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
Item 2. Acquisition or Disposition of Assets.
On July 14, 1999, the Partnership purchased a newly
constructed Children's World daycare center in West Chester,
Ohio from ARAMARK Educational Resources, Inc. The total
cash purchase price of the land and building was
approximately $1,021,743. ARAMARK Educational Resources,
Inc. is not affiliated with the Partnership.
The cash, used in purchasing the property, was from
the proceeds of sale of properties.
Item 7. Financial Statements and Exhibits.
(a) Financial statements of businesses acquired. -
Not Applicable. Property is newly
constructed.
(b) A limited number of proforma adjustments are
required to illustrate the effects of the
transaction on the balance sheet and income
statement. The following narrative
description is furnished in lieu of the
proforma statements:
Assuming the Partnership had acquired the
property on January 1, 1998, the Partnership's
Investments in Real Estate would have
increased by $1,021,743 and its Current Assets
(cash) would have decreased by approximately
$1,021,743.
The Total Income for the Partnership would
have increased from $682,468 to $775,630 for
the year ended December 31, 1998 and from
$171,579 to $194,810 for three months ended
March 31, 1999 if the Partnership had owned
the property during the periods.
Depreciation Expense would have increased by
$24,510 and $6,127 for the year ended December
31, 1998 and the three months ended March 31,
1999, respectively.
The net effect of these proforma adjustments
would have caused Net Income to increase from
$238,990 to $307,642 and from $94,461 to
$111,625, which would have resulted in Net
Income of $41.51 and $15.06 per Limited
Partnership Unit outstanding for the year
ended December 31, 1998 and the three months
ended March 31, 1999, respectively.
(c) Exhibits
Exhibit 10.1 Purchase and Sale
Agreement and Escrow Instructions
dated May 20, 1999 between AEI
Fund Management, Inc. and ARAMARK
Educational Resources, Inc.
relating to the property at 7236
Tylers Corner, West Chester, Ohio.
Exhibit 10.2 Second Assignment
of Purchase and Sale Agreement and
Escrow Instructions dated June 18,
1999 between the Partnership, AEI
Fund Management, Inc. and ARAMARK
Educational Resources, Inc.
relating to the property at 7236
Tylers Corner, West Chester, Ohio.
Exhibit 10.3 Net Lease Agreement
dated July 14, 1999 between the
Partnership and ARAMARK
Educational Resources, Inc.
relating to the property at 7236
Tylers Corner, West Chester, Ohio.
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.
AEI REAL ESTATE FUND XV
LIMITED PARTNERSHIP
By: AEI Fund Management 86-A, Inc.
Its: Managing General Partner
Date: July 26, 1999 /s/ Mark E Larson
By: Mark E. Larson
Its Chief Financial Officer
PURCHASE AND SALE AGREEMENT
AND
ESCROW INSTRUCTIONS
DATE OF AGREEMENT: May 20,
SELLER: ARAMARK Educational Resources, Inc.
dba Children's World Learning Centers,
a Delaware corporation
Address: 573 Park Point Drive
Golden, CO 80401
Attn.: John Rosen, Exec. VP
Telephone: (303) 526-1600
PURCHASER: AEI Fund Management, Inc. or assigns
Address: 1300 MN World Trade Center
30 East Seventh Street
St. Paul, MN 55101
Atten: Robert P. Johnson, Pres.
Telephone: 651-227-7333
ESCROW AGENT: Lawyers Title Insurance Corporation
Address: 3636 North Central Avenue
Suite 350
Phoenix, AZ 85012
Attn.: David Nowlin
Telephone: 602-287-3500
Facsimile: 602-263-0433
PROPERTIES: Those real properties, individually or
collectively, listed below and described
on EXHIBIT "A", together with all
improvements thereon, and all the
rights, easements, and appurtenances
pertaining thereto, including, without
limitation, any right, title, and
interest of Seller in and to adjacent
streets, alleys, or right of way.
PRICES: The purchase price of each property
shall be as described on Exhibit A
hereto.
CENTER NAME & NUMBER LOCATION YR. BUILT
1. CWLC #0137 Copperfield 18035 Forrest Height Dr. 8/95
Houston, TX
2. CWLC #0322 Grant Ranch 6000 Grant Ranch Rd 8/98
Denver, CO
3. CWLC #0439 Ledgeview 1553 Arcadian Drive 8/98
DePere, WI
4. CWLC #0463 Mequon 10813 N. Port Wash. Rd 2/97
Mequon, WI
5. CWLC #0730 Silverlake 2325 County Road 90 3/97
Pearland, TX
6. CWLC # 0822 Trellis Lane 3325 Trellis Land 8/95
Abingdon, MD
7. CWLC #0840 Wetherington 7236 Tylers Corner 3/97
West Chester, OH
ESCROW OPENING DATE: May 27, 1999
(To Be Inserted By Escrow Agent)
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
RECITALS
A. Seller is the owner of the Properties, each of which
consists of improved real property.
B. Seller desires to sell the Properties to Purchaser, and
Purchaser desires to purchase the Properties from Seller,
upon the terms and conditions set forth herein.
C. It is the intent of the parties that, contemporaneous with
the Closing as defined on page 4 of this Agreement, Seller
shall lease the Properties from the Purchaser pursuant to
the terms and conditions stated in the form net lease
attached hereto as Exhibit B. A separate lease will be
signed for each Property purchased, subject only to those
modifications of the attached form lease which are necessary
for the lease to be legally binding in the state in which
the property is located.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
1. PURCHASE AND SALE; PURCHASE PRICE; TERMS OF PAYMENT.
1.1 PURCHASE AND SALE. Seller agrees to sell and
Purchaser agrees to purchase the Properties on the terms and
conditions set forth in this Agreement and further agree that
Purchaser may purchase all, none, or some, but not less than
three of the Properties.
1.2 PURCHASE PRICE. The purchase price which Purchaser
agrees to pay for each Property is described on Exhibit A hereto
(the "Purchase Price(s)"):
1.3 TERMS OF PAYMENT. The Purchase Price shall be
payable as follows:
1.3.1 EARNEST MONEY DEPOSIT. Upon execution of
this document by both parties and receipt of a Seller-signed
copy by Purchaser, $20,000 in immediately available funds shall
be deposited for each property (a total of $140,000) with Escrow
Agent as an earnest money deposit ("Earnest Money Deposit").
Upon receipt of the Earnest Money Deposit, Escrow Agent shall
immediately deposit it in a federally insured account and open
an escrow account for the transactions contemplated hereby. Any
interest earned on escrowed funds shall remain the property of,
and be paid to, Purchaser.
1.3.2 CLOSING PAYMENT. An amount equal to the
difference between the Purchase Price and the Earnest Money
Deposit shall be paid by Purchaser in immediately available
funds at Closing (the "Closing Payment").
2. CLOSING. The closing of this transaction ("Closing") shall
occur, at the offices of Escrow Agent located at Lawyers Title
Insurance Company ("Title Company"), 3636 North Central Avenue
Suite 350, Phoenix, Arizona 85012, attention David Nowlin,
unless another location is mutually agreed to by the parties, on
the date twenty (20) business days following the expiration of
the Properties Review Period ("Closing Date"). Either party may
participate in the Closing by mail.
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3. DEED. At the Closing, Seller shall convey title to the
Properties to Purchaser by form of Special Warranty Deed
customarily used in the County where the Properties are located
("Deed"), subject only to those specific matters approved by
Purchaser as herein provided in connection with the title
insurance policy to be issued by Lawyers Title Insurance
Corporation (the "Title Insurer").
4. TITLE AND TITLE INSURANCE.
4.1 TITLE REPORT. Within twenty (20) days from each
Opening Date, Escrow Agent shall deliver a current Commitment for
Title Insurance or a Preliminary Title Report ("Title Report") on
the Properties from Title Insurer (as defined below) to both
Purchaser and Seller. Such Title Report shall show the status of
title to the Properties as of the date of the Title Report and
shall be accompanied by legible copies of all title exceptions
documents referred to in the Title Report.
4.2 TITLE REVIEW PERIOD. With respect to each Property
separately, Purchaser shall have a period of time beginning upon
Purchaser's receipt of the Title Report and copies of all
documents referred to therein and ending at 5:00 p.m., Central
Standard time, fifteen (15) business days thereafter (the "Title
Review Period"), to review the Title Report and to give Seller
and Escrow Agent notice of any title exceptions which are
unacceptable to Purchaser. If Purchaser gives notice of
dissatisfaction as to any exception to title as shown in the
Title Report, or any amendment thereto, Seller may, but shall not
be obligated to, attempt to eliminate the disapproved exception
from the Title Report or any amendment thereto prior to the
Closing Date. If Seller does not eliminate the disapproved
exception prior to the Closing Date, Purchaser's sole and
exclusive remedies shall be to either cancel this Agreement with
respect to such Property only by giving Seller and Escrow Agent
written notice of cancellation, or to close such transaction with
respect to such Property only subject to such previously
disapproved exception. Notwithstanding the foregoing, if Seller
notifies Purchaser in writing of its election not to eliminate a
disapproved exception to title, Purchaser shall have until the
earlier of the Closing Date or five (5) business days after
receiving Seller's notice of making its election in writing as
described above to either cancel this transaction or proceed to
Closing with respect to such Property only. Purchaser's failure
to make a timely election shall be deemed its election to close
this transaction with respect to such Property only, taking title
subject to any previously disapproved title exception. With
respect to any amendments or updates to the Title Report or
previous amendments or updates thereto, the same provisions and
procedures described above shall apply with respect to
Purchaser's review and approval of, and Seller's option to
eliminate, disapproved exceptions, except that Purchaser shall
have five (5) business days after its receipt of the amendment or
update to give its notice of dissatisfaction of any new title
exception. Purchaser shall have the right to cancel this
Agreement for up to four (4) Properties. Therefore, Purchaser
must approve the title documents for at least three (3)
Properties or lose the right to purchase any of the Properties.
It is the parties' intent that Purchaser must purchase at least
three (3) Properties for any sale to occur. Once Purchaser has
eliminated five (5) Properties from purchase based upon any right
in this Agreement to do so, then Seller shall have the option to
terminate this Agreement.
4.3 APPROVAL OR DISAPPROVAL OF STATUS OF TITLE.
Purchaser's failure to approve or disapprove any exception during
the Title Review Period as to a specific Property shall be deemed
an approval of title as described in the Title Report and a
waiver of Purchaser's right to cancel this Agreement according to
this Article. Upon any cancellation of this Agreement in full in
accordance with this Article, Escrow Agent shall, without further
instruction from either party, return the Earnest Money Deposit
to Purchaser and this Agreement and the escrow shall terminate.
Upon any cancellation of this
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Children's World Purchase Agreement
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Agreement in part, Escrow Agent shall return to Purchaser, along
with a pro-rata share of any interest earned thereon, a pro-rata
share of the Earnest Money Deposit.
4.4 OWNER'S TITLE POLICY. Provided Purchaser approves,
or is deemed to have approved, the status of title to each of the
Properties during the Title Review Period, Seller shall cause
Escrow Agent to provide Purchaser with a standard coverage
owner's policy of title insurance (the "Owner's Title Policy") at
the Closing or as soon thereafter as is reasonably possible. The
Owner's Title Policy shall be issued by the Title Insurer in the
full amount of the Purchase Price, be effective as of the Closing
Date, and shall insure Purchaser that fee simple title to the
Properties is vested in Purchaser, subject only (i) to the
exceptions to title approved by Purchaser as provided for in
ARTICLES 4.2 AND 4.3 of this Agreement (ii) any exceptions
regarding survey matters; and (iii) any other matter approved in
writing by Purchaser or resulting from the acts of Purchaser or
Purchaser's agents. The cost of any endorsement to the Owner's
Title Policy shall be paid in by Purchaser.
5. FEASIBILITY CONDITION.
5.1 PROPERTIES REVIEW PERIOD. During the period of time
beginning upon the date that Seller has met its obligations as
defined in ARTICLE 5.4 HEREOF, and ending at 5:00 PM Central
Standard time sixty (60) business days thereafter ("Properties
Review Period"), Purchaser shall have the right to enter upon the
Properties, (only if accompanied by Seller's representative or
agent) for the purpose of further examination and investigation
of the Properties. Purchaser, its representatives and agents
shall have the right during this Properties Review Period to
conduct all testing and examinations it deems necessary to
determine the desirability of purchasing the Properties.
Purchaser shall have the right during this Properties Review
Period to cancel this Agreement in whole or in part if Purchaser
is dissatisfied, in its sole and absolute discretion, with the
results of its examination of the Properties or any documentation
related thereto, or for any other reason. If this Agreement is
canceled with respect to one or more of the Properties, but not
all of them, then, upon written notice by Purchaser to the Escrow
Agent, a pro-rata portion of the earnest money deposit, along
with any interest earned or accrued thereon, shall be immediately
paid by the Escrow Agent to the Purchaser and this Agreement and
the Escrow Account shall remain in effect for the balance of any
remaining, non-canceled, Properties.
5.2 WHEN EARNEST MONEY BECOMES NON-REFUNDABLE. On or
before expiration of the Properties Review Period, Purchaser
shall give written notice to Seller and Escrow Agent of its
election to either cancel this Agreement or to proceed to close
the transaction upon the terms and conditions herein. If
Purchaser elects to cancel this Agreement in accordance with this
Article, Escrow Agent shall, without further instruction from
either party, return the Earnest Money Deposit to Purchaser and
the escrow shall terminate. If Purchaser elects to proceed to
close this transaction, the Earnest Money Deposit shall become
nonrefundable to Purchaser, except if Seller fails to perform
when due any act required of it by this Agreement. Purchaser's
failure to give written notice of its election to either cancel
or proceed to close this transaction shall be deemed a waiver of
its election to cancel this Agreement.
5.3 INDEMNIFICATION. All entries on, and inspections or
studies of, the Properties shall be at the expense of Purchaser
and Purchaser shall indemnify and hold Seller harmless from and
against any and all liens, claims, demands, injuries, damages,
losses, costs, expenses (including all reasonable attorney fees),
or liability incurred by or asserted against the Seller or any of
the Properties as a result of any of those entries, inspections
or studies, which Purchaser's indemnification shall survive the
Closing or any termination of this Agreement.
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5.4 Seller has already provided to Purchaser (and shall
transfer as a part of the purchase herein contemplated), copies
of any final existing plans, preliminary or as-built surveys,
Phase I or other environmental and engineering and soils reports,
and similar or relevant documentation in the possession of the
Seller (as specified in letter from Chris Bardwell to Mr. Robert
Johnson dated April 30, 1999) (collectively, the "Properties
Documents"). The sixty (60) day Properties Review Period shall
expire sixty (60) days from the date of Seller's execution of
this Agreement.
5.5 NONINTERFERENCE WITH BUSINESS. The Properties are
presently being used as daycare centers. Notwithstanding anything
to the contrary, Purchaser may not conduct any of its tests or
examinations during normal business hours except with the prior
written permission of Seller which may be arbitrarily withheld by
Seller. No chemicals or hazardous substances shall be used in any
testing or examination except with the prior written permission
of Seller. No tools or materials shall be left or stored in or
around the Properties during the Properties Review Period.
Purchaser agrees to indemnify Seller and hold Seller harmless
from the cost, liability, expense or injury to person or property
arising out of any violation of this Paragraph 5.5 including but
not limited to attorney fees.
5.6 FINANCING CONDITIONS AND OBLIGATIONS. There shall be no
financing contingency connected with this Agreement. If Purchaser
obtains financing to purchase the Properties, then the total
Purchase Price shall be increased by Twenty-five Thousand and
No/100 Dollars ($25,000.00). This increase is due to the extra
time, money, effort, and problems that Seller experiences and may
experience due to a financed sale.
6. ESCROW.
6.1 ESTABLISHMENT OF ESCROW. An escrow for this transaction
shall be established with Escrow Agent and Escrow Agent is hereby
employed by the parties to handle the escrow. This Agreement
shall constitute escrow instructions and an original or fully
executed copy shall be deposited with Escrow Agent for this
purpose. Should Escrow Agent require the execution of its
standard form printed escrow instructions, Purchaser and Seller
agree to execute the same; however, such instructions shall be
construed as applying only to Escrow Agent's employment, and if
there are conflicts between the terms of this Agreement and the
terms of the printed escrow instructions, the terms of this
Agreement shall control.
6.2 CANCELLATION OF ESCROW. If the escrow fails to close
because of Seller's default, Seller shall be liable for all
customary escrow cancellation charges. If the escrow fails to
close because of Purchaser's default, Purchaser shall be liable
for all customary escrow cancellation charges. If the escrow
fails to close for any other reason, Seller and Purchaser shall
each be liable for one-half (1/2) of all customary escrow
cancellation charges.
6.3 LEASE. The parties hereby agree upon the form of
the Lease and memorandum of lease as attached as Exhibit B
hereto. At closing, duplicate copies of such form lease will be
signed for each Property purchased, subject only to changes
necessary for each lease to be legally binding in the state in
which the Property is located. Upon Closing, the Escrow Agent
shall insert into the Lease, and the parties hereby give the
Escrow Agent Power of Attorney to insert, the Lease commencement
Date which shall be the Closing Date. If closing does not occur
for any reason whatsoever, the Escrow Agent shall destroy the
Leases. The Escrow Agent is further instructed upon Closing to
record that certain Memorandum of Lease referred to in Exhibit C
of Exhibit B. Such Memorandum shall be recorded in the office of
the clerk and recorder,
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Children's World Purchase Agreement
5/20/99
register of deeds or analogous office immediately subsequent to
the recording of the Deed, with no intervening documents being
recorded.
7. CLOSING COSTS.
7.1 SELLER'S CLOSING COSTS. Seller will pay for and
provide AEI with a standard title policy. All other closing costs
for each Parcel shall be borne equally by Seller and AEI equally.
Seller will pay AEI a due diligence expense allowance (the
"Allowance") of $35,000 per Parcel, payable at the closing of the
purchase of each Parcel. No Allowance shall be payable to AEI for
any Parcel not purchased by AEI.
7.2 PRORATIONS. Real estate taxes, personal property
taxes and assessments, if any, shall be prorated through escrow,
as of the Closing Date, and be based upon the latest available
information. Any other closing costs shall be paid equally by
Purchaser and Seller.
8. POSSESSION. Possession of the Properties sold shall be
delivered to Purchaser upon Closing, subject to a lease executed
between the parties.
9. BROKERAGE. Purchaser and Seller warrant and represent to
each other that neither has dealt with any real estate broker or
salesperson in connection with this transaction. If any person
shall assert a claim to a finder's fee, brokerage commission, or
any other compensation on account of alleged employment as a
finder or broker or performance of services as a finder or broker
in connection with this transaction, the party under whom the
finder or broker is claiming shall indemnify and hold the other
party harmless from and against any such claim and all costs,
expenses and liabilities incurred in connection with such claim
or any action or proceeding brought on such claim, including, but
not limited to, counsel and witness fees and court costs in
defending against such claim. This indemnity shall survive the
Closing or cancellation and termination of this Agreement and the
escrow.
10. REMEDIES.
10.1 SELLER'S REMEDIES. If Purchaser fails to perform as
required by this Agreement, in the time and manner set forth in
this Agreement, and provided Seller is not then in default,
Seller, as Seller's sole and exclusive remedy, may cancel this
Agreement and the escrow, such cancellation to be effective
immediately upon Seller giving written notice of cancellation to
Purchaser and Escrow Agent. Upon such cancellation, Seller shall
be entitled to, and Escrow Agent shall deliver to Seller, the
Earnest Money Deposit, as consideration for acceptance of this
Agreement, for taking the Properties off the market, and as the
parties' best estimate of Seller's damages resulting from
Purchaser's default, but not as a penalty. Subject to 16.5
hereof, the Earnest Money Deposit released to Seller upon such
cancellation shall be retained by Seller as its sole and
exclusive remedy against Purchaser in all respects. Any accrued
interest shall be paid to Purchaser.
10.2 PURCHASER'S REMEDIES. Only if Seller fails to close
any transaction(s) as required by this Agreement, in the time and
manner set forth in this Agreement, and provided Purchaser is not
in default, Purchaser, as its sole and exclusive remedy, may
cancel this Agreement and the Escrow, such cancellation to be
effective immediately upon Purchaser giving written notice of
cancellation to Seller and Escrow Agent. Upon such cancellation,
Purchaser shall be entitled to, and Escrow Agent shall deliver to
Purchaser, the Earnest
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Money Deposit and any interest earned thereon, and Seller shall
pay to Purchaser $20,000 per Property as to any Property not
closed due to Seller's failure to Close as required by this
Agreement as consideration for entering into this Agreement and
as the parties' best estimate of Purchaser's damages resulting
from Seller's default, but not as a penalty. Subject to 16.5
hereof, the Earnest Money Deposit and any interest earned thereon
released to Purchaser and the $20,000 shall be retained by
Purchaser as its sole and exclusive remedy against Seller in all
respects.
10.3 LIQUIDATED DAMAGES: After endeavoring to estimate what
the actual loss would be in the event of a default and as a
material inducement to execution hereof, the parties agree that
it would be impractical and extremely difficult to fix actual
damages in case of a default. The amount of the Earnest Money
Deposited is a reasonable estimate of Seller's damages and Seller
shall retain the Earnest Money Deposit as stated above, and
Purchaser shall be entitled to payment from Seller of $20,000 per
Property as set forth in Article 10.2 above, as their sole remedy
against each other in case of default. The parties shall also be
entitled to attorney fees pursuant to 16.5.
11. OPENING DATE. The "Opening Date" shall be the date on which
the Earnest Money Deposit, together with a fully executed copy or
counterpart copies of the Purchase Agreement are received by the
Escrow Agent. Escrow Agent is hereby instructed to enter that
Opening Date on the first page of this Agreement and return a
copy to both Seller and Purchaser.
12. SELLER'S REPRESENTATIONS AND WARRANTIES. Seller
represents and warrants to Purchaser (and on the Closing Date
shall be deemed to represent and warrants) as follows:
12.1 LEGAL, VALID AND BINDING. This Agreement and all
other instruments or documents executed or delivered with this
transaction each constitute legal, valid and binding obligations
of Seller, enforceable against Seller in accordance with their
respective terms.
12.2 NO APPROVAL BY GOVERNMENTAL AUTHORITY. No consent,
approval, authorization, registration, qualification,
designation, declaration or filing with any governmental
authority is required in connection with the execution and
delivery of this Agreement by Seller.
12.3 NO CONFLICT. The execution, delivery and performance
of this Agreement by Seller and the consummation of the
transaction contemplated herein will not: (i) result in a breach
or acceleration of or constitute a default or event of
termination under the provisions of any agreement or instrument
by which the Properties is bound or affected; (ii) result in the
creation or imposition of any lien, charges or encumbrance, not
provided for herein, on or against the Properties or any portion
thereof; (iii) constitute or result in the violation or breach by
Seller of any judgment, order, writ, injunction or decree issued
against or imposed upon Seller, or result in the violation of any
applicable law, rule or regulation of any governmental authority.
12.4 NO LAWSUITS. Seller, having undertaken no independent
inquiry, there are no actions, suits, proceedings or
investigations pending, to the best of Seller's knowledge or
threatened, with respect to or in any manner affecting Seller's
ownership of the Properties or otherwise affecting any portion
thereof, or which will become a cloud on the title to the
Properties or question the validity or enforceability of the
transaction contemplated herein.
12.5 NO LEASES. There will be no existing leases and/or
tenancies affecting all or any portion of the Properties as of
the Closing Date, except for that certain lease between the
parties attached as Exhibit "B".
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12.6 NO MECHANICS LIENS. No work has been performed or is in
progress at, and no materials have been furnished to, the
Properties or any portion thereof, which might give rise to
mechanics', materialmen's or other lien against Purchaser's
interest in the Properties or any portion thereof. Seller hereby
agrees to indemnify Purchaser from and against any and all claims
of third parties, and from all mechanics' liens in connection
with the Properties whose claim of lien arises from labor or
material provided to the Properties prior to Closing or pursuant
to a contract entered into with Seller prior to Closing,
including all costs and attorneys' fees.
12.7 NON-FOREIGN AFFIDAVIT. Seller is not, and as of the
Closing Date will not be, a "foreign person" within the meaning
of Internal Revenue Code Section 1445, and Seller shall deliver
to Purchaser at Closing a Non-Foreign Affidavit pursuant to
Section 1445(b)(2) of the Internal Revenue Code (the "Non-Foreign
Affidavit").
13. AS IS. Except for the express representations and
warranties contained in this Article 12, Seller has made no
representations or warranties of any kind, and will at the
Closing make no representations or warranties of any kind, in
connection with the physical condition of the Properties. Except
for the representations and warranties contained in Article 12
and the covenants and warranties to be contained in the Deed,
Seller shall have no responsibility, liability or obligations
subsequent to the Closing with respect to any conditions or as to
any matters whatsoever respecting in any way the Properties,
which Purchaser acknowledges is being purchased in an "AS IS,
WHERE IS" condition. Seller does represent and warrant that it
has given Purchaser all environmental reports (Phase I or
otherwise) in Seller's possession which relate to the Properties.
14. RISK OF LOSS. If prior to the Closing all of any Property
shall be taken by condemnation or eminent domain, this Agreement
shall be automatically canceled, the Earnest Money Deposit and
any interest earned thereon shall be returned to Purchaser, and
thereupon neither party shall, except as otherwise provided
herein, have any further liability or obligation to the other. If
prior to the Closing, less than all of any Property shall be
taken by condemnation or eminent domain, then Purchaser may, at
its option, cancel this Agreement as to such Property only, in
which event Escrow Agent shall return to Purchaser its Earnest
Money Deposit, and any interest earned thereon, as to such
Property [i.e., twenty thousand dollars ($20.000) plus interest]
and thereupon neither party shall have any further liability or
obligation to each other (except as otherwise stated herein) as
to such Property, or Purchaser may accept title subject to the
taking, in which event after the Closing the proceeds of the
award or payment shall be assigned by Seller to Purchaser and any
money theretofore received by Seller in connection with such
taking shall be paid over to Purchaser. In the event any Property
shall be damaged by fire or other casualty prior to the time of
Closing in an amount of more than ten percent (10%) of the total
Purchase Price of said Property, either party shall have the
option to terminate this Agreement as to such Property. Should
the parties elect to carry out this Agreement regarding such
Property despite such damage, Purchaser shall be entitled to a
credit for the insurance proceeds resulting from such damage to
the Property not exceeding, however, the total Purchase Price of
said property. In all other regards, the risk of loss or damage
to the Property until the Closing shall be borne by Seller.
15. NOTICES. All notices required or permitted to be given
under this Agreement shall be in writing and shall be given by
personal delivery, recognized overnight courier services or by
deposit in the United States mail, certified mail, return receipt
requested, postage prepaid, addressed to Seller and Purchaser at
the addresses set forth on the first page of this Agreement or at
such other address as a party may designate by notice similarly
given. Notices shall be deemed effective upon delivery; if
personally delivered: on
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
the next business day after deposit with a recognized overnight
courier service; or on the expiration of three (3) days after
deposit in the US mail, as described above. A copy of any notice
shall be given to Escrow Agent.
Copies of any notice given to Seller shall also be given to:
Mark R. Lewis, Esq.
Mark R. Lewis, P.C.
9725 East Hampden Avenue Suite 300
Denver, CO 80231
Telephone Number: 303-745-5200
Facsimile Number: 303-745-4800
16. MISCELLANEOUS.
16.1 INCORPORATION OF RECITALS. The recitals of this
Agreement are hereby affirmed by the parties as true and correct
and are incorporated herein by this reference.
16.2 WAIVERS. No waiver of any of the provisions of this
Agreement shall constitute a waiver of any other provision,
whether or not similar, nor shall any waiver be a continuing
waiver. Except as expressly provided in this Agreement, no waiver
shall be binding unless executed in writing by the party making
the waiver. Either party may waive any provision of this
Agreement intended for its sole benefit; however, unless
otherwise provided for herein, such waiver shall in no way excuse
the other party from the performance of any of its other
obligations under this Agreement.
16.3 CONSTRUCTION. This Agreement shall be interpreted
according to the law of the state where the Properties are
located, and shall be construed as a whole and in accordance with
its fair meaning and without regard to, or taking into account,
any presumption or other rule of law requiring construction
against the party preparing this Agreement or any part hereof.
16.4 TIME. Time is of the essence of this Agreement.
16.5 ATTORNEY'S FEES. If any action is brought by either
party in respect to its rights under this Agreement, the
prevailing party shall be entitled to reasonable attorneys' fees
and court costs as determined by the court.
16.6 ASSIGNMENT. Purchaser may assign its rights under
this Agreement prior to Closing without the prior written consent
of Seller.
16.7 BINDING EFFECT. This Agreement and all instruments
or documents entered into pursuant hereto are binding upon and
shall inure to the benefit of the parties and their respective
successors and assigns.
16.8 FURTHER ASSURANCES AND DOCUMENTATION. Each party
agrees in good faith to take such further actions and execute
such further documents as may be necessary or appropriate to
fully carry out the intent and purpose of this Agreement.
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
16.9 TIME PERIODS. If the time for the performance of any
obligation under this agreement expires on a Saturday, Sunday or
legal holiday, the time for performance shall be extended to the
next succeeding day which is not a Saturday, Sunday or legal
holiday.
16.10 HEADINGS. The headings of this Agreement are for
purposes of reference only and shall not limit or define the
meaning of any provision of this Agreement.
16.11 ENTIRE AGREEMENT. This Agreement, together with
all exhibits referred to herein, which are incorporated herein
are made a part hereof by this reference and the Lease between
the parties, constitutes the entire agreement between the parties
pertaining to the subject matter contained in this Agreement. No
supplement, modification or amendment of this Agreement shall be
binding unless in writing and executed by Purchaser and Seller.
16.12 COUNTERPARTS. This Agreement may be executed in
any number of counterparts, each of which shall be deemed an
original, but all of which shall constitute one and the same
instrument.
16.13 SURVIVAL. Each of the terms and provisions of this
Agreement, including the representations and warranties contained
in ARTICLE 12, which are not incorporated into the Deed, or which
are not satisfied by the execution and delivery of the Deed, or
which by their nature require the parties to perform certain acts
subsequent to the Closing, shall survive the Closing, except that
the representations and warranties contained in ARTICLE 12 shall
survive the Closing for a period of only six (6) months only.
16.14 CONDITION TO SELLER CLOSING. In no event shall
Seller be required to Close this transaction or sell any
Properties to Purchaser unless Purchaser purchases and closes
simultaneously on at least three Properties.
16.15 MEQUON, WISCONSIN PROPERTY. Pursuant to Section 2
of that certain Easement, Construction and Maintenance Agreement
dated June 26, 1996 between Clemens Loving Trust and Seller,
Seller is presently entitled to certain costs incurred by Seller
in performing work referred to in said Section 2. The parties
expect the payment shall be made by Clemens (or its successor),
prior to the time of closing of the Mequon Property. However, if
in any event,
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
Seller does not receive said costs in full pursuant to said
Section 2 by Closing, then the parties shall execute such
reasonable documents necessary to indicate that the right to
payment of such costs are being retained by Seller, and to the
extent transferred by operation of law or otherwise, assigned to
Seller by Purchaser.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first above written.
SELLER:
ARAMARK Educational Resources, Inc.,
d/b/a Children's World Learning Centers,
Inc., a Delaware Corporation
5/20/99 By: /s/ John Rosen
Date
Its: Executive Vice President
PURCHASER:
AEI Fund Management, Inc. or its assigns
/s/ Robert P Johnson
May 20, 1999 By: Robert P. Johnson
Date
Its: President
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
ACCEPTANCE BY ESCROW AGENT
Escrow Agent hereby (a) acknowledges receipt of a fully
executed copy or counterpart copies of this Agreement on this
27th day of May, and has inserted said date on the first page of
this Agreement, and (b) hereby agrees to establish an escrow
(Escrow No. 99-17612- (Master)) and to administer the same in
accordance with the provisions hereof. Escrow Agent further
agrees to immediately deliver to Purchaser and Seller copies or
counterpart of this fully executed Agreement.
Lawyers Title Insurance Corporation
By: /s/ David D Moulin
Its: National Title Officer
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
EXHIBIT A
TO
PURCHASE AND SALE AGREEMENT
AND
ESCROW INSTRUCTIONS
Attached to and forming a part of PURCHASE AND SALE
AGREEMENT AND ESCROW INSTRUCTIONS between AEI and ARAMARK
EDUCATIONAL RESOURCES, INC. DBA Children's World Learning
Centers, dated 5/20/99, 1999:
PURCHASE PRICE
SILVERLAKE
If Closing
OCCURS BY: BUT OCCURS NO LATER THAN: TOTAL PURCHASE
PRICE SHALL BE:
04/30/99 05/27/99 $914,000
05/28/99 07/01/99 $912,000
07/02/99 07/30/99 $910,000
WETHERINGTON
If Closing
OCCURS BY: BUT OCCURS NO LATER THAN: TOTAL PURCHASE
PRICE SHALL BE:
04/30/99 05/27/99 $1,019,000
05/28/99 07/01/99 $1,017,000
07/02/99 07/30/99 $1,015,000
LEDGEVIEW
If Closing
OCCURS BY: BUT OCCURS NO LATER THAN: TOTAL PURCHASE
PRICE SHALL BE:
04/30/99 05/27/99 $1,153,000
05/28/99 07/01/99 $1,150,000
07/02/99 07/30/99 $1,148,000
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
GRANT RANCH
If Closing
OCCURS BY: BUT OCCURS NO LATER THAN: TOTAL PURCHASE
PRICE SHALL BE:
04/30/99 05/27/99 $1,451,000
05/28/99 07/01/99 $1,449,000
07/02/99 07/30/99 $1,446,000
MEQUON
If Closing
OCCURS BY: BUT OCCURS NO LATER THAN: TOTAL PURCHASE
PRICE SHALL BE:
04/30/99 05/27/99 $1,172,000
05/28/99 07/01/99 $1,170,000
07/02/99 07/30/99 $1,168,000
TRELLIS LANE
If Closing
OCCURS BY: BUT OCCURS NO LATER THAN: TOTAL PURCHASE
PRICE SHALL BE:
04/30/99 05/27/99 $983,000
05/28/99 07/01/99 $982,000
07/02/99 07/30/99 $980,000
COPPERFIELD
If Closing
OCCURS BY: BUT OCCURS NO LATER THAN: TOTAL PURCHASE
PRICE SHALL BE:
04/30/99 05/27/99 $867,000
05/28/99 07/01/99 $865,000
07/02/99 07/30/99 $863,000
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
EXHIBIT "B"
TO
PURCHASE AND SALE AGREEMENT
NET LEASE AGREEMENT
THIS LEASE, made and entered into effective as of this
day of , 1999, by and between AEI Fund Management,
Inc. a Minnesota corporation, (or its assigns) whose address is
1300 Minnesota World Trade Center, 30 East 7th Street, Saint
Paul, Minnesota 55101 ("Lessor"), and Children's World Learning
Centers, Inc., a Delaware corporation, whose address is 573 Park
Point Drive, Golden, Colorado 80401 ("Lessee");
WITNESSETH:
WHEREAS, Lessor is the fee owner of a certain parcel of real
property and improvements located at ___________________ and
legally described in Exhibit "A" attached hereto and incorporated
herein by reference; and
WHEREAS, Lessee constructed or caused the construction of
the building and improvements (together the "Building") on the
real property described in Exhibit "A"; and
WHEREAS, Lessee desires to lease sell said real property and
Building (said real property and Building hereinafter referred to
as the "Leased Premises"), to Lessor and simultaneously lease
said real property and Building back from Lessor upon the terms
and conditions hereinafter provided;
NOW, THEREFORE, in consideration of the rents, terms,
covenants, conditions, and agreements hereinafter described to be
paid, kept, and performed by Lessee, Lessor does hereby grant,
demise, lease, and let unto Lessee, and Lessee does hereby take
and hire from Lessor and does hereby covenant, promise, and agree
as follows:
ARTICLE 1. LEASED PREMISES
Lessor hereby leases to Lessee, and Lessee leases and takes
from Lessor, the Leased Premises subject to the conditions of
this Lease.
ARTICLE 2. TERM
(A) The term of this Lease ("Term") shall be fifteen (15)
consecutive "Lease Years", as hereinafter defined, commencing on
________, 1999 ("Occupancy Date").
(B) The first "Lease Year" of the Term shall be for a
period of twelve (l2) consecutive calendar months beginning at
the Occupancy Date. If the Occupancy Date shall be other than the
first day of a calendar month, the first "Lease Year" shall be
the period of time from the Occupancy Date to the end of the
calendar month of the Occupancy Date, plus the following twelve
(l2) calendar months. Each Lease Year after the first Lease Year
shall be a successive period of twelve (l2) calendar months.
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
(C) A short form or memorandum of this Lease has been
executed for recording purposes in the form attached as Exhibit C
hereto. Termination of Lessee's right to possession shall be
conclusive evidence of termination of any option to renew,
purchase, or to any right of first refusal, if any. Entry of a
court order terminating Lessee's right of possession shall be
sufficient evidence of the termination of any rights established
by such Memorandum of Lease, and the Memorandum of Lease shall so
state. Abandonment of the Leased Premises by Lessee shall not be
considered a termination of Lessee's right to possession of the
Leased Premises if Lessee continues maintenance of the Premises
and payment of rent under the terms of the Lease.
ARTICLE 3. RESPONSIBILITY FOR IMPROVEMENTS
(A) Lessee represents, to the best of its knowledge, that
the Building and all other improvements to the land do comply
with the applicable laws, ordinances, rules, and regulations of
all state, federal and local governments.
(B) Opening for business in the Leased Premises by Lessee
shall constitute an acceptance of the Leased Premises "as is and
where is" and an acknowledgment by Lessee that the premises are
in the condition described under this Lease and that Lessee is
responsible for the correction or repair of any defects or
deficiencies in or of the Premises whether in existence as of the
date of this Lease or discovered after such date, including but
not limited to compliance with applicable laws, ordinances, rules
and regulations of all state, federal, and local governments.
ARTICLE 4. RENTAL PAYMENTS
A. Annual Rent Payable for the first through Fifth Lease
Years:
For each of the first five Lease Years, Lessee
shall pay to Lessor an annual rent of
$_______________ , which amount shall be payable in
advance without demand on the first day of each month
in equal monthly installments of [see Exhibit B
hereto for rents to be inserted into individual
leases]. If the first day of the first month of the
Lease Term is not the first day of a calendar month,
then the monthly rental payable for that partial
month shall be a prorated portion of the equal
monthly installment of rent.
B. Annual Rent Payable for the Sixth through Tenth Lease
Years:
The Annual Rent payable for the Sixth through
the Tenth Lease Years shall be the same amount each
year and shall be computed at the beginning of the
sixth Lease Year to be an amount equal to the rent
paid for the Fifth Lease Year, increased by the
lesser of ten percent (10%) of the rent for the Fifth
Lease Year, or two hundred percent (200%) the "CPI
Increase", as defined below, times the rent for the
Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the effective date of the Lease to the
nearest date four months prior to the last day of the
Fifth Lease Year. (For purposes of determining this
increase, the Consumer Price Index for the
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
fourth month preceding the effective date of the
Lease shall be compared to the CPI for the month that
if four months prior to the end of the Fifth Lease
Year.)
C. Annual Rent Payable for the Eleventh through
Fifteenth Lease Years:
The Annual Rent payable for the Eleventh through
the Fifteenth Lease Years shall be the same amount
each year and shall be computed at the beginning of
the sixth Lease Year to be an amount equal to the
rent paid for the Fifth Lease Year, increased by the
lesser of ten percent (10%) of the rent for the Fifth
Lease Year, or two hundred percent (200%) the "CPI
Increase", as defined below, times the rent for the
Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the first day of the Sixth lease year to the
nearest date four months prior to the last day of the
Tenth Lease Year. (For purposes of determining this
increase, the Consumer Price Index for the fourth
month preceding the effective date of the Lease shall
be compared to the CPI for the month that if four
months prior to the end of the Fifth Lease Year.)
D. Annual Rent Payable for the Sixteenth through
Twentieth Lease Years:
The Annual Rent payable for the Sixteenth
through the Twentieth Lease Years shall be the same
amount each year and shall be computed at the
beginning of the sixth Lease Year to be an amount
equal to the rent paid for the Fifth Lease Year,
increased by the lesser of ten percent (10%) of the
rent for the Fifth Lease Year, or two hundred percent
(200%) the "CPI Increase", as defined below, times
the rent for the Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the first day of the Eleventh Lease Year to
the nearest date four months prior to the last day of
the Fifteenth Lease Year. (For purposes of
determining this increase, the Consumer Price Index
for the fourth month preceding the effective date of
the Lease shall be compared to the CPI for the month
that if four months prior to the end of the Fifth
Lease Year.)
E. Annual Rent Payable for the Twenty-First through
Twenty-Fifth Lease Years:
The Annual Rent payable for the Twenty-First
through the Twenty-Fifth Lease Years shall be the
same amount each year and shall be computed at the
beginning of the sixth Lease Year to be an amount
equal to the rent paid for the Fifth Lease Year,
increased by the lesser of ten percent (10%) of the
rent for the Fifth Lease Year, or two hundred percent
(200%) the "CPI Increase", as defined below, times
the rent for the Fifth Lease Year.
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the first day of the fifteenth Lease Year to
the nearest date four months prior to the last day of
the Twentieth Lease Year. (For purposes of
determining this increase, the Consumer Price Index
for the fourth month preceding the effective date of
the Lease shall be compared to the CPI for the month
that if four months prior to the end of the Fifth
Lease Year.)
F. Annual Rent Payable for the Twenty-Sixth through
Thirtieth Lease Years:
The Annual Rent payable for the Twenty-Sixth
through the Thirtieth Lease Years shall be the same
amount each year and shall be computed at the
beginning of the sixth Lease Year to be an amount
equal to the rent paid for the Fifth Lease Year,
increased by the lesser of ten percent (10%) of the
rent for the Fifth Lease Year, or two hundred percent
(200%) the "CPI Increase", as defined below, times
the rent for the Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the first day of the Twentieth Lease Year to
the nearest date four months prior to the last day of
the Twenty-Fifth Lease Year. (For purposes of
determining this increase, the Consumer Price Index
for the fourth month preceding the effective date of
the Lease shall be compared to the CPI for the month
that if four months prior to the end of the Fifth
Lease Year.)
G. Overdue Payments.
Lessee shall pay interest on all overdue
payments of Rental or other monetary amounts due
hereunder at a rate equal to the prime rate (as
announced by the Wall Street Journal newspaper) plus
two percent, accruing from the date such Rental or
other monetary amounts were properly due and payable.
ARTICLE 5. INSURANCE AND INDEMNITY
(A) Lessee shall, throughout the Term or Renewal Terms, if
any, of this Lease, at its own cost and expense, procure and
maintain insurance which covers the Leased Premises and
improvements against fire, wind, and storm damage (including
flood insurance if the Leased Premises is in a federally
designated flood prone area) and such other risks as may be
included in the broadest form of extended coverage insurance as
may, from time to time, be available in amounts sufficient to
prevent Lessor or Lessee from becoming a co-insurer within the
terms of the applicable policies. In any event, the insurance
coverage shall not be less than one hundred percent (100%) of the
then insurable value. Additionally, replacement cost
endorsements, vandalism endorsement, malicious mischief
endorsement, waiver of subrogation endorsement, waiver of co-
insurance endorsement (if available), shall be obtained.
(B) Lessee agrees to place and maintain throughout the
Term or Renewal Terms, if any, of this Lease, at Lessee's own
expense, public liability insurance with respect to Lessee's use
and occupancy of said
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
premises, with initial limits of at least $2,000,000/$5,000,000
for bodily injury and $l00,000 for property damage, or such
additional amounts subject to commercially reasonable
deductibles, as Lessor shall reasonably require from time to
time, and pollution liability or environmental impact coverage
with limits in amounts reasonably acceptable to Lessor.
(C) Lessee agrees to notify Lessor in writing if Lessee is
unable to procure all or some part of the aforesaid insurance. In
the event Lessee fails to provide all insurance required under
this Lease, Lessor shall have the right, but not the obligation,
to procure such insurance on Lessee's behalf. Lessee will then,
within ten (10) business days from receiving written notice, pay
Lessor the amount of the premiums due or paid, together with
interest thereon at the current prime rate plus two percent,
which amount shall be considered rent payable by Lessee in
addition to the Rental defined at Article 4 hereof.
(D) All policies of insurance provided for or contemplated
by this Article shall name Lessor and Robert P. Johnson, and
Lessee and any mortgagee as insureds or additional named insured
and loss payee, as their respective interests may appear, and
shall provide that the policies cannot be canceled, changed,
terminated, or modified in a manner that materially affects the
insurance required hereunder without thirty (30) days written
notice to the parties. All insurance companies must have an A.M.
Best rating of "Good" or better. Lessee has provided Lessor with
a legible copy of the applicable insurance certificate(s) and
will provide Lessor with copies of any changes thereto and shall
provide evidence no less than thirty (30) days prior to the
expiration thereof of the renewal thereof and the renewal and
existence of requisite public liability insurance as by current
Certificates of Insurance.
(E) Lessee shall defend, indemnify, and hold Lessor
harmless against any and all claims, damages, and lawsuits
arising after the Occupancy Date of this Lease and any orders,
decrees or judgments which may be entered therein, brought for
damages or alleged damages resulting from any injury to person or
property or from loss of life sustained in or about the Leased
Premises, and Lessee agrees to save Lessor harmless from, and
indemnify Lessor against, any and all injury, loss, or damage, of
whatever nature, to any person or property caused by, or
resulting from any act, omission, or negligence of Lessee or any
employee or agent of Lessee. In addition, Lessee hereby releases
Lessor from any and all liability for any loss or damage caused
by fire or any of the extended coverage casualties, even if such
fire or other casualty shall be brought about by the negligence
(but not the gross negligence or intentional or willful
misconduct or malice) of Lessor.
(F) Lessor hereby waives any and all rights that it may
have to recover from Lessee damages for any loss occurring to the
Leased Premises by reason of any act or omission of Lessee;
provided, however, that this waiver is limited to those losses
for which Lessor is compensated by its insurers. Lessee hereby
waives any and all right that it may have to recover from Lessor
damages for any loss occurring to the Leased Premises by reason
of any act or omission of Lessor; provided, however, that this
waiver is limited to those losses for which Lessee is compensated
by its insurers.
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
ARTICLE 6. TAXES, ASSESSMENTS AND UTILITIES
(A) Lessee shall be liable, and agrees to pay the charges
for, all public utility services rendered or furnished to the
Leased Premises, including heat, water, gas, electricity, sewer,
sewage treatment facilities and the like, all personal property
taxes, real estate taxes, special assessments, and municipal or
government charges, general, ordinary and extraordinary, of every
kind and nature whatsoever, which may be levied, imposed, or
assessed against the Leased Premises, or upon any improvements
thereon, at any time after the Occupancy Date of this Lease and
prior to the expiration of the term hereof, or any Renewal Term.
(B) Lessee shall pay all real estate taxes, assessments
for public improvements or benefits, and other governmental
impositions, duties, and charges of every kind and nature
whatsoever which shall or may, during the term of this Lease, be
charged, laid, levied, assessed, or imposed upon, or become a
lien or liens upon the Leased Premises or any part thereof or
upon the rents payable hereunder, except for taxes based solely
upon the income of Lessor. Such payments shall be considered as
rent paid by Lessee in addition to the Rent defined at Article 4
hereof. Lessee shall be deemed to have complied with the
foregoing covenant if payment is permitted without penalty or
interest, or before the same shall become a lien upon the Leased
Premises. If by law any real estate taxes, assessments for public
improvements or benefits, or other governmental impositions,
duties, and charges of every kind and nature whatsoever may at
the option of the taxpayer be paid in installments (whether or
not interest shall accrue on the unpaid balance), Lessee may
exercise the option to pay the same in installments and shall pay
such installments as they become due during the term of this
Lease. Lessee shall not be liable for installments which come due
after the termination date of the Lease. If due to a change in
the method of taxation, a franchise tax, rental tax, or income or
profit tax shall be levied against Lessor in substitution for or
in lieu of any tax which would otherwise constitute a real estate
tax, such tax shall be deemed a real estate tax for the purposes
herein and shall be paid by Lessee.
(C) All real estate taxes, assessments for public
improvements or benefits, water rates and charges, sewer rents,
and other governmental impositions, duties, and charges which
shall become payable for the first and last tax years of the term
hereof shall be apportioned pro rata between Lessor and Lessee in
accordance with the respective number of months during which each
party shall be in possession of the Leased Premises in said
respective tax years. For the purposes of this provision, all
personal property taxes, real estate taxes and special
assessments shall be deemed to have been assessed in the year
that the first payment or any installment thereof is due.
(D) Lessee shall have the right to contest or review by
legal proceedings or in such other manner as may be legal (which,
if instituted, shall be conducted solely at Lessee's own expense)
any tax, assessment for public improvements or benefits, or other
governmental imposition aforementioned, at any time until the
property is subject to levy or execution. All such proceedings
shall be begun as soon as reasonably possible after the
imposition or assessment of any contested items and shall be
prosecuted to final adjudication with reasonable dispatch. In the
event of any reduction, cancellation, or discharge, Lessee shall
pay the amount that shall be finally levied or assessed against
the Leased Premises or adjudicated to be due and payable, and, if
there shall be any refund payable by the governmental authority
with respect thereto, Lessee shall be entitled to receive and
retain the same, subject, however, to apportionment as provided
during the first and last years of the term of this Lease.
(E) Lessor, within sixty (60) days after notice to Lessee
if Lessee fails to commence such proceedings, may, but shall not
be obligated to, contest or review by legal proceedings, or in
such other manner as may be legal, and at Lessor's own expense,
any tax, assessments for public
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
improvements and benefits, or other governmental imposition
aforementioned, which shall not be contested or reviewed, as
aforesaid, by Lessee, and unless Lessee shall promptly join with
Lessor in such contest or review, Lessor shall be entitled to
receive and retain any refund payable by the governmental
authority with respect thereto.
(F) Lessor shall not be required to join in any proceeding
referred to in this Article, unless in Lessee's reasonable
opinion, the provisions of any law, rule, or regulation at the
time in effect shall require that such a proceeding be brought by
and/or in the name of Lessor, in which event Lessor shall upon
written request, join in such proceedings or permit the same to
be brought in its name.
ARTICLE 7. ASSIGNMENT AND SUBLETTING
A. So long as Lessee shall remain fully liable for the
performance of all obligations of any lessee under this Lease,
and if Lessee provides notice and true and complete copies of all
assignments or sublet agreements to Lessor, then Lessee may
assign or sublet this Lease or the Premises without the prior
permission of Lessor.
Lessee shall, prior to the effective date thereof deliver to
Lessor executed counterparts of any such agreement and of all
ancillary agreements with the proposed assignee or sublessee, as
applicable. Lessor shall have the right to require all rental
payable to Lessee under any such subletting or assignment to be
payable to Lessor.
ARTICLE 8. REPAIRS AND MAINTENANCE
(A) Lessee covenants and agrees to keep and maintain in
good order, condition and repair the interior and exterior of the
Leased Premises during the term of the Lease, and further agrees
that Lessor shall be under no obligation to make any repairs or
perform any maintenance to the Leased Premises. Lessee covenants
and agrees that it shall be responsible for all repairs,
alterations, replacements, or maintenance of, including but
without limitation, interior and exterior portions of all doors,
door checks and operators, windows, plate glass, plumbing, water
and sewage facilities, fixtures, electrical equipment, interior
walls, ceilings, signs, interior building appliances and similar
equipment, heating and air conditioning equipment, and further
agrees to be replace any of said equipment when necessary. Lessee
further agrees to be responsible for, at its own expense, snow
removal, lawn maintenance, landscaping, maintenance of the
parking lot (including parking lines, seal coating, and blacktop
surfacing), and other similar items.
(B) If after written notice and a 90 day cure period
(except in the event of emergencies), Lessee refuses or neglects
to commence or complete repairs promptly and adequately, Lessor
may cause such repairs to be made, but shall not be required to
do so, and Lessee shall pay the cost thereof to Lessor upon
demand. It is understood that Lessee shall pay all expenses and
maintenance and repair during the term of this Lease. If Lessee
is not then in default hereunder, Lessee shall have the right to
make repairs and improvements to the Leased Premises without the
consent of Lessor if such repairs and improvements do not exceed
$50,000 provided such repairs or improvements do not affect the
structural integrity of the Leased Premises. Any repairs or
improvements in excess of $50,000 or affecting the structural
integrity of the Leased Premises may be done only with the prior
written consent of Lessor, such consent not to be unreasonably
withheld. All alterations and additions to the Leased Premises
shall be made in accordance with all applicable laws and shall
remain for the benefit of Lessor. Lessee further agrees, in the
event of making such alterations as herein provided, to indemnify
and save harmless Lessor from all expense, liens, claims or
damages to either persons or property or the Leased Premises
arising out of or resulting from the undertaking or making of
said repairs, improvements,
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alterations or additions, or Lessee's failure to make said
repairs, improvements, alterations or additions.
ARTICLE 9. COMPLIANCE WITH LAWS AND REGULATIONS
Lessee will materially comply with all statutes, ordinances,
rules, orders, regulations and requirements of all federal,
state, city and local governments, and with all rules, orders
and regulations of the applicable Board of Fire Underwriters
which affect the use of the improvements. Lessee will materially
comply with all easements, restrictions, and covenants of record
against or affecting the Leased Premises required for operation
of the Leased Premises in accordance with Article 14 hereof.
ARTICLE 10. SIGNS
Lessee shall have the right to install and maintain a sign
or signs advertising Lessee's business, provided that the signs
conform to law, and further provided that the sign or signs
conform specifically to the written requirements of the
appropriate governmental authorities.
ARTICLE 11. SUBORDINATION
(A) Lessor reserves the right and privilege to subject and
subordinate this Lease at all times to the lien of any mortgage
or mortgages now or hereafter placed upon Lessor's interest in
the Leased Premises and on the land and buildings of which said
premises are a part, or upon any buildings hereafter placed upon
the land of which the Leased Premises are a part, and to any and
all advances to be made under such mortgages, and all renewals,
modifications, extensions, consolidations, and replacements
thereof, provided such a mortgagee shall execute a reasonably
appropriate subordination, attornment and non-disturbance
agreement (which shall include the right to quiet enjoyment).
(B) Lessee covenants and agrees to execute and deliver,
upon demand, such further reasonable instrument or instruments
subordinating this Lease on the foregoing basis to the lien of
any such mortgage or mortgages as shall be desired by Lessor and
any mortgages or proposed mortgagees.
ARTICLE 12. CONDEMNATION OR EMINENT DOMAIN
(A) If the whole of the Leased Premises are taken by any
public authority under the power of eminent domain, or by private
purchase in lieu thereof, then this Lease shall automatically
terminate upon the date possession is surrendered, and Rent shall
be paid up to that day. If any part of the Leased Premises shall
be taken so as to reduce the licensed capacity of the Premises as
a daycare facility by more than 10%, then Lessee shall have the
right to terminate this Lease on thirty (30) days notice to
Lessor if given within ninety (90) days after the date of such
taking. In the event that this Lease shall terminate or be
terminated in accordance with this section, the Rent shall, if
and as necessary, be paid up to the day that possession of the
Leased Premises was surrendered.
(B) If any part of the Leased Premises shall be taken such
that it does not, reduce the licensed capacity of the facility by
more than 10%, then Lessee shall, using proceeds of the award
from the taking authority, restore
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the remaining portion of the Leased Premises to the extent
necessary to render it satisfactory to Lessee and reasonably
suitable for the purposes for which it was leased. Lessee shall
make all repairs to the building in which the Leased Premises is
located to the extent necessary to constitute the building a
complete architectural unit, provided, however, that such work
shall not exceed the scope of the work required to originally
construct the building. Provided, further, the cost thereof to
Lessee shall not exceed the proceeds of its condemnation award,
all to be done without any adjustments in rent to be paid by
Lessee. Lessor agrees to make the condemnation proceeds available
to Lessee for restoration or repair pursuant to this section.
(C) Subject to Article 12(B) above, all compensation
awarded or paid upon such total or partial taking of the Leased
Premises shall belong to and be the property of Lessor without
any participation by Lessee, whether such damages shall be
awarded as compensation for diminution in value to the leasehold
or to the fee of the premises herein leased. Nothing contained
herein shall be construed to preclude Lessee from prosecuting any
claim directly against the condemning authority in such
proceedings for loss of business, damage to or cost of removal of
or for the value of stock, trade fixtures, furniture, and other
personal property belonging to Lessee; provided, however, that no
such claim shall diminish or otherwise adversely affect Lessor's
award or the award of any fee mortgagee. If a separate award
shall be made representing the difference between the value of
the leasehold estate and the fair market value of a comparable
leasehold estate, Lessee shall be entitled to the same; provided,
however, that Lessor shall be under no obligation to pursue such
award on behalf of Lessee
ARTICLE 13. RIGHT TO INSPECT
Lessor reserves the right to enter upon, inspect and examine
the Leased Premises at any time during business hours, and Lessee
agrees to allow Lessor free access to the Leased Premises to
show the premises upon a minimum of 48 hours prior notice to
Lessee. Lessor will not enter into the Leased Premises for
purposes of this section unless accompanied by a representative
of Lessee and Lessee does hereby agree to provide such
representative upon request by Lessor, such request given not
less than 48 hours in advance. Upon default by Lessee or at any
time within ninety (90) days of the expiration or termination of
the Lease, Lessee agrees to allow Lessor to then place "For Sale"
or "For Rent" signs on the Leased Premises.
ARTICLE 14. USE OF LEASED PREMISES
(A) Lessee agrees and warrants that the Leased Premises
will be used only for lawfully permitted uses which do not
diminish the value of the Leased Premises.
ARTICLE 15. DESTRUCTION OF PREMISES
(A) If, during the term of this Lease, the Leased Premises
are totally or partially destroyed by fire or the elements, so as
to render the premises wholly unfit for occupancy, or make it
impossible in the opinion of a licensed third party arbitrator
knowledgeable in the child care business reasonably acceptable
to Lessee and Lessor, for Lessee to conduct its business therein,
then either Lessor or Lessee shall have the right to terminate
this Lease from the date of such damage or destruction by giving
written notice. The parties agree to use reasonable promptness to
obtain the opinion of such licensed third party arbitrator. Upon
the giving of such notice, Lessee shall immediately surrender the
Leased Premises and all interest therein to Lessor, and in case
of any such termination, Lessor may re-enter and repossess the
Leased Premises and may dispossess all parties then in possession
thereof. If
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not otherwise terminated, in the event the Leased Premises shall
be repaired, restored, and rebuilt by Lessee with the use of
insurance proceeds (which Lessor shall cooperate to make
available), but otherwise at its own sole cost and expense,
within one hundred eighty (180) days from the date of
destruction, then all rents payable by Lessee shall be abated
during the period of repair and restoration to the extent Lessor
shall be compensated by the proceeds of rents loss insurance. In
no event shall Lessor be required to provide its own money for
the repair or restoration of the Leased Premises other than the
net proceeds of moneys received by it from any insurance policy
or policies covering such loss or damages. Lessee shall be liable
for repair of the Leased Premises with all reasonable speed, and
the rents shall recommence on the date that the repairs are
completed. Lessee shall be under no obligation to so repair
during the last five (5) years of the term of the Lease, or as
extended, but if Lessee shall desire to rebuild during the last
12 months of the Lease term, Lessor will make insurance proceeds
available to rebuild the Leased Premises conditioned upon Lessee
then exercising its next renewal option under the Lease. Lessor
will make insurance proceeds available to rebuild the Leased
Premises in the event Lessee rebuilds, except as stated above.
(B) If the damage does not, in the opinion of a licensed
third party arbitrator reasonably acceptable to Lessee and
Lessor, render the Leased Premises unfit for occupancy, then
Lessor agrees that the damage shall be repaired as soon as
practicable and in that case, Lessee shall pay full rent during
the repair period. All repairs shall be paid for by Lessee out of
any insurance proceeds received (which Lessor shall cooperate to
make available), but if the insurance proceeds are insufficient
to rebuild or repair the Leased Premises according to the
original plans and specifications, whether repair or restoration
is commenced pursuant to paragraph A or B hereof, then Lessee
agrees to pay all additional amounts that are required to rebuild
the building in accordance with the original plans and
specifications. All improvements or betterments placed by Lessee
on the demised premises shall, however, in any event, be repaired
and replaced by Lessee at its own expense and not at the expense
of Lessor. The purpose of this Article is to require Lessee to
carry insurance coverage on the Leased Premises sufficient to
rebuild the improvements in the event of damage or destruction.
Lessee shall be under no obligation to so rebuild during the last
five (5) years of the term, as extended, as the case may be, but
if Lessee shall desire to rebuild during the last 12 months of
the Lease term, Lessor will make insurance proceeds available to
rebuild the Leased Premises conditioned upon Lessee then
exercising its next renewal option under the Lease. Lessor will
make insurance proceeds available to rebuild the Leased Premises
in the event Lessee rebuilds, except as stated above.
Risk that the insurance company shall be insolvent or shall
refuse to make insurance proceeds available shall be with Lessee.
The Leased Premises shall be so restored or rebuilt so as to be
of at least equal value and substantially the same character as
prior to such damage or destruction. If the insurance proceeds
are less than $100,000 they shall be paid to Lessee for such
repair and restoration. If the insurance proceeds are greater
than or equal to $100,000 they shall be deposited by Lessee and
Lessor into a customary construction escrow at a nationally
recognized title insurance company, or at Lessee's option, with
Lessor ("Escrowee") and shall be made available from time to time
to Lessee for such repair and restoration. Such proceeds shall be
disbursed in conformity with the terms and conditions of a
commercially reasonable construction loan agreement. Lessee
shall, in either instance, deliver to Lessor or Escrowee (as the
case may be) satisfactory evidence of the estimated cost of
completion together with such architect's certificates, waivers
of lien, contractor's sworn statements and other evidence of cost
and of payments as the Lessor or Escrowee may reasonably require
and approve. If the estimated cost of the work exceeds One
Hundred Thousand Dollars ($100,000), all plans and specifications
for such rebuilding or restoration shall be subject to the
reasonable approval of Lessor.
Lessee /s/ JR Lessor /s/ RPJ
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ARTICLE 16. ACTS OF DEFAULT
(A) Each of the following shall be deemed a default by
Lessee and a breach of this Lease:
1. Failure to pay the Rent, or any monetary
obligation herein reserved, (and to be considered to
be rent for the purposes of this Lease) or any part
thereof, within five (5) business days after written
notice from Lessor that the same shall be due and
payable. Provided, however, that interest and
penalties for failure to pay rent when due shall
accrue from the first date such rent was due and
payable.
2. Failure to do, observe, keep and perform
any of the material non-monetary terms, covenants,
conditions, agreements and provisions in this Lease
to be done, observed, kept and performed by Lessee
within 30 days after written notice of such default
(or within a reasonable time thereafter if the
default is incapable of cure within 30 days and
Lessee is diligently pursuing a reasonable course of
action to cure such default.
3. The abandonment (defined herein as the
leaving of the Leased Premises without paying rent,
without maintaining and without the intent of
returning) of the Premises by Lessee, the
adjudication of Lessee as a bankrupt, the making by
Lessee of a general assignment for the benefit of
creditors, the taking by Lessee of the benefit of
any insolvency act or law, the appointment of a
permanent receiver or trustee in bankruptcy for
Lessee property, or the appointment of a temporary
receiver which is not vacated or set aside within
sixty (60) days from the date of such appointment.
ARTICLE 17. TERMINATION FOR DEFAULT
In the event of any uncured default by Lessee and at any
time thereafter, Lessor may serve a written notice upon Lessee
that Lessor elects to terminate this Lease upon a specified date
not less than thirty (30) days after the date of serving such
notice of termination, and this Lease shall then terminate on the
date so specified, provided, however, that Lessee shall have
continuing liability for future rents for the remainder of the
original term and any exercised renewal term as set forth in
Article 19, notwithstanding any earlier termination of the Lease
hereunder, preserving unto Lessor the benefit of its bargained-
for rental payments.
ARTICLE 18. LESSOR'S RIGHT OF RE-ENTRY
In the event that this Lease shall be terminated as herein
provided, or by summary proceedings or otherwise, or in the event
of an uncured default hereunder by Lessee, or in the event that
the premises or any part thereof, shall be abandoned by Lessee,
(subject to rights to cure as provided in Article 16) Lessor or
its agents, servants or representatives, may immediately or at
any time thereafter, re-enter and resume possession of the
premises or any part thereof, and remove all persons and property
therefrom, in accordance with local law either by summary
dispossess proceedings or by a suitable action or proceeding at
law, without being liable for any damages therefor.
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ARTICLE 19. LESSEE'S CONTINUING LIABILITY
(A) Should Lessor elect to re-enter as provided in this
Lease or should it take possession pursuant to legal proceedings
or pursuant to any notice provided for by law, it may either (i)
terminate this Lease or (ii) it may from time to time, without
terminating the contractual obligation of Lessee to pay Rent
under this Lease, make such commercially reasonable alterations
and repairs as may be necessary to relet the Leased Premises or
any part thereof for such Term or Renewal Terms, at such
commercially reasonable rental or rentals, and upon such other
commercially reasonable terms and conditions as Lessor in its
sole discretion may deem advisable.
(B) Upon each such reletting, without termination the
contractual obligation of Lessee to pay Rent under this Lease
all rentals received by Lessor shall be applied as follows:
1. First, to the payment of any indebtedness
other than rent due hereunder from Lessee to Lessor;
2. Second, to the payment of any costs and
expenses of such reletting, including brokerage fees
and reasonable attorney's fees and of costs of such
alterations and repairs;
3. Third, to the payment of rent due and
unpaid hereunder;
4. The residue, if any, shall be held by
Lessor and applied in payment of future rent as the
same may become due and payable hereunder. Then any
residue will be used first to reimburse Lessor (or
Lessee if previously paid by Lessee for costs and
expenses per Article 19(B)2 above) for such costs and
expenses incurred per Article 19(B)2 above until
repaid, then any excess shall remain with Lessor.
If such rentals received from such reletting during any
month are less than that to be paid during that month by Lessee
hereunder, Lessee shall pay any such deficiency to Lessor. Such
deficiency shall be calculated and paid monthly. No such re-entry
or taking possession of such Leased Premises by Lessor shall be
construed as an election on its part to terminate this Lease
unless a written notice of such intention be given to Lessee.
(C) Notwithstanding any such reletting without
termination, Lessor may at any time thereafter elect to terminate
this Lease for any breach.
(D) In addition to any other remedies Lessor may have with
this Article 19, Lessor may recover from Lessee all damages it
may incur by reason of any breach, including the cost of
recovering and reletting the Leased Premises, reasonable
attorney's fees, and including the present value (discounted at a
rate of 8% per annum) of the excess of the amount of rent and
charges equivalent to rent reserved in this Lease for the
remainder of the Term over the then reasonable rental value of
the Leased Premises (or the actual rents receivable by Lessor, if
relet) for the remainder of the Term, all of which amounts shall
be immediately due and payable from Lessee to Lessor in full. In
determining the rent which would be payable by Lessee hereunder,
subsequent to default, the total Rental for each year of the
unexpired Term shall be equal to the average total Rental that
would be payable by Lessee as set forth in Article 4 above. In
the event that the rent obtained from such alternative or
substitute tenant is more than the rent which Lessee is obligated
to pay under this Lease, then such excess shall be paid to
Lessor provided that Lessor shall credit such excess against the
outstanding obligations of Lessee due pursuant hereto, if any.
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(E) Lessor will use its reasonable efforts to attempt to
mitigate damages of Lessee, but Lessor shall have absolutely no
obligation to expend any moneys in the way of tenant inducements
or in the refurbishment of the Leased Premises for any use other
than that for which the Leased Premises were being used by
Lessee. It is the object and purpose of this Article 19 that
Lessor shall be kept whole and shall suffer no damage by way of
non-payment of rent or by way of diminution in rent. Lessee
waives and will waive all rights to trial by jury in any summary
proceedings to recover possession of the Leased Premises which
may hereafter be instituted by Lessor.
ARTICLE 20. PERSONALTY, FIXTURES AND EQUIPMENT
(A) All building fixtures, building machinery, and
building equipment used in connection with the operation of the
Leased Premises including, but not limited to, heating, lighting,
ventilating, plumbing, walk-in refrigerators, walk-in freezers,
and air conditioning systems shall be the property of Lessor. All
trade fixtures and all other fixtures and articles of personal
property owned by Lessee shall remain the property of Lessee.
(B) Lessee shall furnish and pay for any and all
equipment, furniture, trade fixtures, and signs, except for such
items, if any, described in Article 20(A) above. Lessor agrees
that it has no interest in the personal property of Lessee.
(C) At the end of the term of this Lease, all personal
property and trade fixture of Lessee may be removed from the
Leased Premises by Lessee, however, removal of such fixtures may
proceed only after five (5) business days prior written notice to
Lessor of the time of such removal and notice of the
identification of the parties performing such removal. All damage
to the Leased Premises which may be caused by the removal of such
property shall be promptly paid for by Lessee.
ARTICLE 21. LIENS
Lessee shall not do or cause anything to be done whereby the
Leased Premises may be encumbered by any mechanic's or other
liens. Whenever and as often as any mechanic's or other lien is
filed against said Leased Premises purporting to be for labor or
materials furnished or to be furnished to Lessee, within thirty
(30) days from the date of the filing of said mechanic's or other
lien (or such earlier period if required by law prevent default
or attachment of the lien) and delivery of notice thereof to
Lessee of Lessee's obligation under this Lease, Lessee shall
remove the lien of record by payment or by bonding with a surety
company authorized to do business in the state in which the
property is located, or other security reasonable acceptable to
Lessor. Should Lessee fail to take the foregoing steps within
said thirty (30) day period, then Lessor shall have the right,
among other things, to pay said lien without inquiring into the
validity thereof, and Lessee shall forthwith reimburse Lessor for
the total expense incurred by it in discharging said lien as
additional rent hereunder, subject to notice to Lessee and a 10
business day cure period.
ARTICLE 22. NO WAIVER BY LESSOR EXCEPT IN WRITING
No agreement to accept a surrender of the Leased Premises or
termination of this Lease shall be valid unless in writing signed
by Lessor. The delivery of keys to any employee of Lessor or
Lessor's agents shall not operate as a termination of the Lease
or a surrender of the premises. The failure of Lessor to seek
redress for violation of, any rule or regulation, shall not
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prevent a subsequent act, which would have originally constituted
a violation, from having all the force and effect of an original
violation. No payment by Lessee or receipt by Lessor of a lesser
amount than the rent herein stipulated shall be deemed to be
other than on account of the earliest stipulated rent, nor shall
any endorsement or statement on any check nor any letter
accompanying any check or payment as rent be deemed an accord and
satisfaction, and Lessor may accept such check or payment without
prejudice to Lessor's right to recover the balance of such rent
or pursue any other remedy provided in this Lease. This Lease
contains the entire agreement between the parties, and any
executory agreement hereafter made shall be ineffective to
change, modify or discharge it in whole or in part unless such
executory agreement is in writing and signed by the party
against whom enforcement of the change, modification or
discharge is sought.
ARTICLE 23. QUIET ENJOYMENT
Lessor covenants that Lessee, upon paying the rent set forth
in Article 4 and all other sums herein reserved as rent and upon
the due performance of all the terms, covenants, conditions and
agreements herein contained on Lessee's part to be kept and
performed, shall have, hold and enjoy the Leased Premises free
from molestation, eviction, or disturbance by Lessor, or by any
other person or persons lawfully claiming the same, and that
Lessor has good right to make this Lease for the full term
granted, including renewal periods.
ARTICLE 24. BREACH - PAYMENT OF COSTS AND ATTORNEYS' FEES
The non-prevailing party agrees to pay and discharge all
reasonable costs, attorneys' fees and expenses that shall be
incurred by the prevailing party in enforcing the covenants,
conditions and terms of this Lease or defending against an
alleged breach.
ARTICLE 25. ESTOPPEL CERTIFICATES
Either party to this Lease will, at any time from time to
time, upon not less than ten (10) business days prior request by
the other party, execute, acknowledge and deliver to the
requesting party a statement in writing, executed by an executive
officer of such party, certifying (a) that this Lease is
unmodified (or if modified then disclosure of such modification
shall be made); (b) that this Lease is in full force and effect;
(c) that the date to which the rent and other charges have been
paid; and (d) that to the knowledge of the signer of such
certificate the other party is not in default in the performance
of any covenant, agreement or condition contained in this Lease,
or if a default does exist, specifying each such default of which
the signer may have knowledge. It is intended that any such
statement delivered pursuant to this Article may be relied upon
by any prospective purchaser or mortgagee of the Leased Premises
or any assignee of such mortgagee or a purchaser of the leasehold
estate.
ARTICLE 26. FINANCIAL STATEMENTS
Lessee will, within ninety (90) days after the end of
Lessee's fiscal year during the term of this Lease, furnish to
the Lessor financial statements of the Lessee. The financial
statements shall be certified by an officer of Lessee or if
financial statements are prepared by an independent certified
public accountant then such accountant's report shall be provided
and such report shall be prepared in conformity with generally
accepted accounting principals with auditor's opinion and
footnotes included therein. The
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financial statements shall include a balance sheet, and related
statement of income.
ARTICLE 27. MORTGAGE
Lessee does hereby agree to make reasonable modifications of
this Lease requested by any Mortgagee of record from time to time
provided such modifications are not material and do not increase
any of the rents or modify any of the business elements of this
Lease.
ARTICLE 28. OPTION TO RENEW
If this Lease is not previously canceled or terminated and
if Lessee is not then in material default hereunder, then Lessee
shall have three (3) separate individual options to renew this
Lease upon the same conditions and covenants contained in this
Lease for three separate individual (3) consecutive periods of
five (5) years each (singularly "Renewal Term").
The first Renewal Term would commence on the date the
original Term expires and successive Renewal Terms would commence
on the last day of the then expiring Renewal Term. Lessee must
give 90 days written notice to Lessor of its intent to exercise
this option prior to the expiration of the original Term of this
Lease or any Renewal Term, as the case may be.
The rent during the Renewal Term or Terms shall increase
each Lease Year of the Renewal Term at the same rate as set forth
in Article 4 above.
ARTICLE 29. MISCELLANEOUS PROVISIONS
(A) All written notices shall be given by certified mail
or express courier. Notices to Lessor shall be addressed to the
person and address given on the first page hereof. Lessor and
Lessee may, from time to time, change these addresses by
notifying each other of this change in writing.
(B) The terms, conditions and covenants contained in this
Lease and any riders and plans attached hereto shall bind and
inure to the benefit of Lessor and Lessee and their respective
successors, heirs, legal representatives, and assigns.
(C) This Lease shall be governed by and construed under
the laws of the State where the premises are situated.
(D) In the event that any provision of this Lease shall
be held invalid or unenforceable, no other provisions of this
Lease shall be affected by such holding, and all of the remaining
provisions of this Lease shall continue in full force and effect
pursuant to the terms hereof.
(E) The paragraph captions are inserted only for
convenience and reference, and are not intended, in any way, to
define, limit, describe the scope, intent, and language of this
Lease or its provisions.
(F) In the event Lessee remains in possession of the
premises herein leased after the expiration of this Lease and
without the execution of a new lease, it shall be deemed to be
occupying said premises as a tenant from
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month-to-month, subject to all the conditions, provisions, and
obligations of this Lease insofar as the same can be applicable
to a month-to-month tenancy except that the monthly installment
of Rental shall be increased 25% from the amount due on the last
month prior to such expiration.
(G) If any installment of rent (whether lump sum, monthly
installments, or any other monetary amounts required by this
Lease to be paid by Lessee and deemed to constitute Rental
hereunder) shall not be paid within 10 days when due, Lessor
shall have the right to charge Lessee a late charge of $250 per
month for unpaid rent for each month that any amount of rent
installment remains unpaid. Said late charge shall commence after
such installment is due and continue until said installment,
interest and all accrued late charges are paid in full.
(H) Any part of the Leased Premises may be conveyed by
Lessor for private easement purposes at any time provided Lessee
gives written consent to such private easement. In the event that
the private easement affects or is related to the playground or
the building on the Leased Premises, then Lessee's consent may be
arbitrarily withheld in Lessee's sole and absolute discretion. If
the private easement does not affect the playground or building
on the Leased Premises, then Lessee's consent may not be
commercially unreasonably withheld. In such event that any part
of the Leased Premises are so conveyed, Lessor shall, at its own
cost and expense, restore the remaining portion of the Leased
Premises to the extent necessary to render it reasonably suitable
for the purposes for which it was leased, all to be done without
adjustments in rent to be paid by Lessee. All proceeds from any
conveyance of a private easement shall belong solely to Lessor.
(I) For the purpose of this Lease, the term "rent" shall
be defined as Rental under Article 4, and any other monetary
amounts required by this Lease to be paid by Lessee.
ARTICLE 30. REMEDIES
NON-EXCLUSIVITY. Notwithstanding anything contained herein
it is the intent of the parties that the rights and remedies
contained herein shall not be exclusive but rather shall be
cumulative along with all of the rights and remedies of the
parties which they may have at law or equity.
ARTICLE 31. HAZARDOUS MATERIALS INDEMNITY
Lessee covenants, represents and warrants to Lessor, its
successors and assigns, (i) that it has not used or permitted and
will not use or permit the Leased Premises to be used, whether
directly or through contractors, agents or tenants, and to the
best of Lessee's knowledge and except as disclosed to Lessor in
writing, the Leased Premises has not at any time been used for
the generating, transporting, treating, storage, manufacture,
emission of, or disposal of any dangerous, toxic or hazardous
pollutants, chemicals, wastes or substances as defined in the
Federal Comprehensive Environmental Response Compensation and
Liability Act of 1980 ("CERCLA"), the Federal Resource
Conservation and Recovery Act of 1976 ("RCRA"), or any other
federal, state or local environmental laws, statutes,
regulations, requirements and ordinances ("Hazardous Materials");
(ii) that there have been no investigations or reports involving
Lessee, or the Leased Premises by any governmental authority
which in any way pertain to Hazardous Materials (iii) that the
operation of the Leased Premises has not violated and is not
currently violating any federal, state or local law, regulation,
ordinance or requirement governing Hazardous Materials; (iv) that
the Leased Premises is not listed in the United States
Environmental Protection Agency's National Priorities List of
Hazardous
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
Waste Sites nor any other list, schedule, log, inventory or
record of Hazardous Materials or hazardous waste sites, whether
maintained by the United States Government or any state or local
agency; and (v) that the Leased Premises will not contain any
formaldehyde, urea or asbestos, except as may have been disclosed
in writing to Lessor by Lessee at the time of execution and
delivery of this Lease. Lessee agrees to indemnify and reimburse
Lessor, its successors and assigns, for:
(a) any breach of these representations and warranties,
and
(b)any loss, damage, expense or cost arising out of
or incurred by Lessor which is the result of a breach
of, misstatement of or misrepresentation of the above
covenants, representations and warranties, and
(c) any and all liability of any kind whatsoever which
Lessor may, for any cause and at any time, sustain or
incur by reason of Hazardous Materials, released or
placed on the Leased Premises during the term of the
Lease,
together with all reasonable attorneys' fees, costs and
disbursements incurred in connection with the defense of any
action against Lessor arising out of the above. These covenants,
representations and warranties shall be deemed continuing
covenants, representations and warranties for the benefit of
Lessor, and any successors and assigns of Lessor and shall
survive expiration or sooner termination of this Lease. The
amount of all such indemnified loss, damage, expense or cost,
shall bear interest thereon at the rate of interest equal to the
rate changed on overdue payment in Section 4(E) and shall become
immediately due and payable in full on demand of Lessor, its
successors and assigns.
ARTICLE 32. ESCROWS
If Lessee has defaulted in payment of any taxes, or if
Lessee shall be in default under any of the items of this Lease,
or if Lessor's Mortgagee shall require Lessor to escrow the
amount of real estate taxes or assessments on a monthly basis,
then in either event, at Lessor's option, Lessee shall deposit
with Lessor on the first day of each and every month thereafter,
an amount equal to one-twelfth (1/12th) of the estimated annual
real estate taxes, assessments ("Charges") due on the Leased
Premises. From time to time out of such deposits Lessor will,
upon the presentation to Lessor by Lessee of the bills therefor,
pay the Charges or will upon presentation of receipted bills
therefor, reimburse Lessee for such payments made by Lessee. In
the event the deposits on hand shall not be sufficient to pay all
of the estimated Charges when the same shall become due from time
to time or the prior payments shall be less than the currently
estimated monthly amounts, then Lessee shall pay to Lessor on
demand any amount necessary to make up the deficiency. The excess
of any such deposits shall be credited to subsequent payments to
be made for such items. If a default or an event of default shall
occur under the terms of this Lease, Lessor may, at its option,
without being required so to do, apply any Deposit on hand to
cure the default, in such order and manner as Lessor may elect.
ARTICLE 33. NET LEASE
Notwithstanding anything contained herein to the contrary it
is the intent of the parties hereto that this Lease shall be a
net lease and that the rent defined pursuant to Paragraph 4
should be a net rent paid to Lessor. Any and all other expenses
including but not limited to, maintenance, repair, insurance,
taxes, and assessments, shall be paid by Lessee.
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
ARTICLE 34. RIGHT TO SUBSTITUTION
If Lessee determines that it is economically unfeasible to
continue operations in or at the Leased Premises, Lessee may
exchange the Leased Premises for another of like kind, value,
size and demographic location acceptable to Lessor. If Lessor
elects to accept a replacement property in exchange for the
Leased Premises owned by Lessor, Lessee shall provide a
replacement property of comparable size, cost, location and
ownership interest in a Section 1031 "like-kind" exchange and
shall lease the replacement Premises from Lessor on identical
terms as contained in the lease for the original Leased Premises.
All costs associated with making such exchange, including the
provision of surveys, title, environmental and all other
documentation normally required or obtained by Lessor, shall be
paid by Lessee.
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
IN WITNESS WHEREOF, Lessor and Lessee have respectively
signed and sealed this Lease as of the day and year first above
written.
LESSEE: CHILDREN'S WORLD LEARNING
CENTERS, INC.
a Delaware corporation
Attest:
By: __________________________
Its: __________________________
STATE OF )
)SS.
COUNTY OF )
The foregoing instrument was acknowledged before me this
______ day of ____________, 1999, by
_________________________________________, the
_________________________________________________________________
_
of Children's World Learning Centers, Inc., a Delaware
corporation, on behalf of said corporation.
Notary Public _____________________________________
LESSOR:
Attest:
By: AEI Fund
Management, Inc.
By: __________________________
Robert P. Johnson,
President
STATE OF MINNESOTA )
)SS.
COUNTY OF RAMSEY )
The foregoing instrument was acknowledged before me the
day of ____________, 1999, by Robert P. Johnson, the President of
AEI Fund Management, Inc., a Minnesota corporation.
Notary Public _____________________________________
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
EXHIBIT A
TO
LEASE AGREEMENT
Legal Description to be attached.
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
EXHIBIT B
TO
LEASE AGREEMENT
Attached to and forming a part of LEASE between AEI and
ARAMARK EDUCATIONAL RESOURCES, INC. DBA Children's World
Learning Centers, dated ___________________________ , 1999:
SCHEDULE OF RENT PAYMENTS
SILVERLAKE
If the Effective Date of the Lease Agreement
OCCURS BY: BUT OCCURS NO LATER THAN: MONTHLY RENT
SHALL BE:
04/30/99 05/27/99 $6,928.50
05/28/99 07/01/99 $6,913.00
07/02/99 07/30/99 $6,897.50
WETHERINGTON
If the Effective Date of the Lease Agreement
OCCURS BY: BUT OCCURS NO LATER THAN: MONTHLY RENT
SHALL BE:
04/30/99 05/27/99 $7,742.25
05/28/99 07/01/99 $7,726.75
07/02/99 07/30/99 $7,711.25
LEDGEVIEW
If the Effective Date of the Lease Agreement
OCCURS BY: BUT OCCURS NO LATER THAN: MONTHLY RENT
SHALL BE:
04/30/99 05/27/99 $8,780.75
05/28/99 07/01/99 $8,757.50
07/02/99 07/30/99 $8,742.00
GRANT RANCH
If the Effective Date of the Lease Agreement
OCCURS BY: BUT OCCURS NO LATER THAN: MONTHLY RENT
SHALL BE:
04/30/99 05/27/99 $11,090.25
05/28/99 07/01/99 $11,074.75
07/02/99 07/30/99 $11,051.50
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
MEQUON
If the Effective Date of the Lease Agreement
OCCURS BY: BUT OCCURS NO LATER THAN: MONTHLY RENT
SHALL BE:
04/30/99 05/27/99 $8,932.60
05/28/99 07/01/99 $8,917.10
07/02/99 07/30/99 $8,901.60
TRELLIS LANE
If the Effective Date of the Lease Agreement
OCCURS BY: BUT OCCURS NO LATER THAN: MONTHLY RENT
SHALL BE:
04/30/99 05/27/99 $7,463.25
05/28/99 07/01/99 $7,455.50
07/02/99 07/30/99 $7,440.00
COPPERFIELD
If the Effective Date of the Lease Agreement
OCCURS BY: BUT OCCURS NO LATER THAN: MONTHLY RENT
SHALL BE:
04/30/99 05/27/99 $6,564.25
05/28/99 07/01/99 $6,548.75
07/02/99 07/30/99 $6,533.25
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
EXHIBIT C
TO
LEASE AGREEMENT
Attached to and forming a part of Lease between
______________________________ and ARAMARK EDUCATIONAL RESOURCES,
INC., a Delaware corporation, d/b/a Children's World Learning
Centers, dated ________________________, 1999.
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE is dated this ________ day of
_______________, 1999, by and between
______________________________, a _____________ corporation
("Landlord"), whose mailing address is
______________________________
____________________ and ARAMARK EDUCATIONAL RESOURCES, INC., a
Delaware corporation, d/b/a Children's World Learning Centers
("CWLC"), whose mailing address is 573 Park Point Drive, Golden,
Colorado, 80401.
Landlord has granted, demised and leased the real property and
improvements described below ("Premises") to CWLC on the
following terms and conditions:
1. DATE OF LEASE: ______________________________, 1999
2. DESCRIPTION OF PREMISES:
INSERT LEGAL DESCRIPTION
also known as _____________, ______________________
3. COMMENCEMENT DATE: _______________________________, 1999
4. TERM: Fifteen (15) years
5. RENEWAL TERMS: Three 5-year options
6. PURCHASE OPTION: N/A
7. Entry of a court order terminating Lessee's right of
possession shall be sufficient evidence of the termination of any
rights established by such Memorandum of Lease.
The purpose of this Memorandum of Lease is to give notice of the
Lease and of the rights created thereby, all of which are hereby
confirmed.
LANDLORD:
__________________________________________
By:
__________________________________________
Name:
__________________________________________
Title:
__________________________________________
Date:
__________________________________________
Lessee /s/ JR Lessor /s/ RPJ
Children's World Purchase Agreement
5/20/99
SECOND ASSIGNMENT
OF
PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS
THIS ASSIGNMENT made and entered into this 18th day of
June, 1999, by and between AEI FUND MANAGEMENT, INC., a
Minnesota corporation, ("Assignor") and AEI REAL ESTATE FUND
XV LIMITED PARTNERSHIP, a Delaware limited partnership and
AEI PRIVATE NET LEASE FUND 1998 LIMITED PARTNERSHIP, a
Minnesota limited partnership ("Assignees");
WITNESSETH, that:
WHEREAS, on the 20th day of May, 1999, Assignor entered
into a Purchase and Sale Agreement and Escrow Instructions
Agreement ("the Agreement") for those certain properties
located as follows:
A. Wetherington 7236 Tylers Corner Drive, West Chester, OH
B. Grant Ranch 6000 W. Grant Ranch Boulevard, Denver, CO
(collectively the "Properties") with ARAMARK Educational
Resources, Inc., as Seller/Lessee; and
WHEREAS, Assignor desires to assign all of its rights,
title and interest in, to and under the Agreement to the
Assignees as hereinafter provided;
NOW, THEREFORE, for One Dollar ($1.00) and other good
and valuable consideration, receipt of which is hereby
acknowledged, it is hereby agreed between the parties as
follows:
1. Assignor assigns all of its rights, title and
interest in, to and under the Agreement to the
Assignee, AEI Real Estate Fund XV Limited Partnership,
with respect to property A listed above, to have and to
hold the same unto the Assignee, its successors and
assigns;
2. Assignee, AEI Real Estate Fund XV Limited
Partnership, hereby assumes all rights, promises,
covenants, conditions and obligations under the
Agreement to be performed by the Assignor thereunder,
and agrees to be bound for all of the obligations of
Assignor under the Agreement with respect to property
A.
3. Assignor assigns all of its rights, title and
interest in, to and under the Agreement to the
Assignee, AEI Private Net Lease Fund 1998 Limited
Partnership, with respect to property B listed above,
to have and to hold the same unto the Assignee, its
successors and assigns;
4. Assignee, AEI Private Net Lease Fund 1998 Limited
Partnership, hereby assumes all rights, promises,
covenants, conditions and obligations under the
Agreement to be performed by the Assignor thereunder,
and agrees to be bound for all of the obligations of
Assignor under the Agreement with respect to property
B.
All other terms and conditions of the Agreement shall remain
unchanged and continue in full force and effect.
AEI FUND MANAGEMENT, INC.
("Assignor")
By: /s/ Robert P Johnson
Robert P. Johnson, its President
AEI REAL ESTATE FUND XV
LIMITED PARTNERSHIP
("Assignee")
BY: AEI Fund Management 86-A, Inc.
By:/s/ Robert P Johnson
Robert P. Johnson, its President
AEI PRIVATE NET LEASE FUND 1998
LIMITED PARTNERSHIP
("Assignee")
By: AEI Fund Management XVIII, Inc.
By: /s/ Robert P Johnson
Robert P. Johnson, its President
NET LEASE AGREEMENT
THIS LEASE, made and entered into effective as of this 14th
day of July, 1999, by and between AEI Real Estate Fund XV
Limited Partnership, whose corporate general partner is AEI Fund
Management 86-A, Inc. a Minnesota corporation, whose address is
1300 Minnesota World Trade Center, 30 East 7th Street, Saint
Paul, Minnesota 55101 ("Lessor"), and ARAMARK Educational
Resources, Inc., f/k/a Children's World Learning Centers, Inc., a
Delaware corporation, whose address is 573 Park Point Drive,
Golden, Colorado 80401 ("Lessee");
WITNESSETH:
WHEREAS, Lessor is the fee owner of a certain parcel of real
property and improvements located at 7236 Tylers Corner, West
Chester, Ohio, and legally described in Exhibit "A" attached
hereto and incorporated herein by reference; and
WHEREAS, Lessee constructed or caused the construction of
the building and improvements (together the "Building") on the
real property described in Exhibit "A"; and
WHEREAS, Lessee desires to lease sell said real property and
Building (said real property and Building hereinafter referred to
as the "Leased Premises"), to Lessor and simultaneously lease
said real property and Building back from Lessor upon the terms
and conditions hereinafter provided;
NOW, THEREFORE, in consideration of the rents, terms,
covenants, conditions, and agreements hereinafter described to be
paid, kept, and performed by Lessee, Lessor does hereby grant,
demise, lease, and let unto Lessee, and Lessee does hereby take
and hire from Lessor and does hereby covenant, promise, and agree
as follows:
ARTICLE 1. LEASED PREMISES
Lessor hereby leases to Lessee, and Lessee leases and takes
from Lessor, the Leased Premises subject to the conditions of
this Lease.
ARTICLE 2. TERM
(A) The term of this Lease ("Term") shall be fifteen (15)
consecutive "Lease Years", as hereinafter defined, commencing on
July 14, 1999 ("Occupancy Date").
(B) The first "Lease Year" of the Term shall be for a
period of twelve (l2) consecutive calendar months beginning at
the Occupancy Date. If the Occupancy Date shall be other than the
first day of a calendar month, the first "Lease Year" shall be
the period of time from the Occupancy Date to the end of the
calendar month of the Occupancy Date, plus the following twelve
(l2) calendar months. Each Lease Year after the first Lease Year
shall be a successive period of twelve (l2) calendar months.
(C) A short form or memorandum of this Lease has been
executed for recording purposes in the form attached as Exhibit B
hereto. Termination of Lessee's right to possession shall be
conclusive evidence of termination of any option to renew,
purchase, or to any right of first refusal, if any. Entry of a
court order terminating Lessee's right of possession shall be
sufficient evidence of the termination of any rights established
by such Memorandum of Lease, and the Memorandum of Lease shall so
state. Abandonment of the Leased Premises by Lessee shall not be
considered a termination of Lessee's right to possession of the
Leased Premises if Lessee continues maintenance of the Premises
and payment of rent under the terms of the Lease.
ARTICLE 3. RESPONSIBILITY FOR IMPROVEMENTS
(A) Lessee represents, to the best of its knowledge, that
the Building and all other improvements to the land do comply
with the applicable laws, ordinances, rules, and regulations of
all state, federal and local governments.
(B) Opening for business in the Leased Premises by Lessee
shall constitute an acceptance of the Leased Premises "as is and
where is" and an acknowledgment by Lessee that the premises are
in the condition described under this Lease and that Lessee is
responsible for the correction or repair of any defects or
deficiencies in or of the Premises whether in existence as of the
date of this Lease or discovered after such date, including but
not limited to compliance with applicable laws, ordinances, rules
and regulations of all state, federal, and local governments.
ARTICLE 4. RENTAL PAYMENTS
A. Annual Rent Payable for the first through Fifth Lease
Years:
For each of the first five Lease Years, Lessee
shall pay to Lessor an annual rent of $93,162.10,
which amount shall be payable in advance without
demand on the first day of each month in equal
monthly installments of $7,763.51. If the first day
of the first month of the Lease Term is not the first
day of a calendar month, then the monthly rental
payable for that partial month shall be a prorated
portion of the equal monthly installment of rent.
B. Annual Rent Payable for the Sixth through Tenth Lease
Years:
The Annual Rent payable for the Sixth through
the Tenth Lease Years shall be the same amount each
year and shall be computed at the beginning of the
sixth Lease Year to be an amount equal to the rent
paid for the Fifth Lease Year, increased by the
lesser of ten percent (10%) of the rent for the Fifth
Lease Year, or two hundred percent (200%) the "CPI
Increase", as defined below, times the rent for the
Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the effective date of the Lease to the
nearest date four months prior to the last day of the
Fifth Lease Year. (For purposes of determining this
increase, the Consumer Price Index for the fourth
month preceding the effective date of the Lease shall
be compared to the CPI for the month that if four
months prior to the end of the Fifth Lease Year.)
C. Annual Rent Payable for the Eleventh through
Fifteenth Lease Years:
The Annual Rent payable for the Eleventh through
the Fifteenth Lease Years shall be the same amount
each year and shall be computed at the beginning of
the sixth Lease Year to be an amount equal to the
rent paid for the Fifth Lease Year, increased by the
lesser of ten percent (10%) of the rent for the Fifth
Lease Year, or two hundred percent (200%) the "CPI
Increase", as defined below, times the rent for the
Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the first day of the Sixth lease year to the
nearest date four months prior to the last day of the
Tenth Lease Year. (For purposes of determining this
increase, the Consumer Price Index for the fourth
month preceding the effective date of the Lease shall
be compared to the CPI for the month that if four
months prior to the end of the Fifth Lease Year.)
D. Annual Rent Payable for the Sixteenth through
Twentieth Lease Years:
The Annual Rent payable for the Sixteenth
through the Twentieth Lease Years shall be the same
amount each year and shall be computed at the
beginning of the sixth Lease Year to be an amount
equal to the rent paid for the Fifth Lease Year,
increased by the lesser of ten percent (10%) of the
rent for the Fifth Lease Year, or two hundred percent
(200%) the "CPI Increase", as defined below, times
the rent for the Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the first day of the Eleventh Lease Year to
the nearest date four months prior to the last day of
the Fifteenth Lease Year. (For purposes of
determining this increase, the Consumer Price Index
for the fourth month preceding the effective date of
the Lease shall be compared to the CPI for the month
that if four months prior to the end of the Fifth
Lease Year.)
E. Annual Rent Payable for the Twenty-First through
Twenty-Fifth Lease Years:
The Annual Rent payable for the Twenty-First
through the Twenty-Fifth Lease Years shall be the
same amount each year and shall be computed at the
beginning of the sixth Lease Year to be an amount
equal to the rent paid for the Fifth Lease Year,
increased by the lesser of ten percent (10%) of the
rent for the Fifth Lease Year, or two hundred percent
(200%) the "CPI Increase", as defined below, times
the rent for the Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the first day of the fifteenth Lease Year to
the nearest date four months prior to the last day of
the Twentieth Lease Year. (For purposes of
determining this increase, the Consumer Price Index
for the fourth month preceding the effective date of
the Lease shall be compared to the CPI for the month
that if four months prior to the end of the Fifth
Lease Year.)
F. Annual Rent Payable for the Twenty-Sixth through
Thirtieth Lease Years:
The Annual Rent payable for the Twenty-Sixth
through the Thirtieth Lease Years shall be the same
amount each year and shall be computed at the
beginning of the sixth Lease Year to be an amount
equal to the rent paid for the Fifth Lease Year,
increased by the lesser of ten percent (10%) of the
rent for the Fifth Lease Year, or two hundred percent
(200%) the "CPI Increase", as defined below, times
the rent for the Fifth Lease Year.
"CPI-U Increase" referred to above is defined as
the percentage increase, if any, in the Consumer
Price Index ("CPI") for all Urban Consumers published
by the Bureau of Labor Statistics of the United
States Department of Labor for U.S. City Average, All
Items (1982-84=100) from the nearest date four months
prior to the first day of the Twentieth Lease Year to
the nearest date four months prior to the last day of
the Twenty-Fifth Lease Year. (For purposes of
determining this increase, the Consumer Price Index
for the fourth month preceding the effective date of
the Lease shall be compared to the CPI for the month
that if four months prior to the end of the Fifth
Lease Year.)
G. Overdue Payments.
Lessee shall pay interest on all overdue
payments of Rental or other monetary amounts due
hereunder at a rate equal to the prime rate (as
announced by the Wall Street Journal newspaper) plus
two percent, accruing from the date such Rental or
other monetary amounts were properly due and payable.
ARTICLE 5. INSURANCE AND INDEMNITY
(A) Lessee shall, throughout the Term or Renewal Terms, if
any, of this Lease, at its own cost and expense, procure and
maintain insurance which covers the Leased Premises and
improvements against fire, wind, and storm damage (including
flood insurance if the Leased Premises is in a federally
designated flood prone area) and such other risks as may be
included in the broadest form of extended coverage insurance as
may, from time to time, be available in amounts sufficient to
prevent Lessor or Lessee from becoming a co-insurer within the
terms of the applicable policies. In any event, the insurance
coverage shall not be less than one hundred percent (100%) of the
then insurable value. Additionally, replacement cost
endorsements, vandalism endorsement, malicious mischief
endorsement, waiver of subrogation endorsement, waiver of co-
insurance endorsement (if available), shall be obtained.
(B) Lessee agrees to place and maintain throughout the
Term or Renewal Terms, if any, of this Lease, at Lessee's own
expense, public liability insurance with respect to Lessee's use
and occupancy of said premises, with initial limits of at least
$2,000,000/$5,000,000 for bodily injury and $l00,000 for property
damage, or such additional amounts subject to commercially
reasonable deductibles, as Lessor shall reasonably require from
time to time, and pollution liability or environmental impact
coverage with limits in amounts reasonably acceptable to Lessor.
(C) Lessee agrees to notify Lessor in writing if Lessee is
unable to procure all or some part of the aforesaid insurance. In
the event Lessee fails to provide all insurance required under
this Lease, Lessor shall have the right, but not the obligation,
to procure such insurance on Lessee's behalf. Lessee will then,
within ten (10) business days from receiving written notice, pay
Lessor the amount of the premiums due or paid, together with
interest thereon at the current prime rate plus two percent,
which amount shall be considered rent payable by Lessee in
addition to the Rental defined at Article 4 hereof.
(D) All policies of insurance provided for or contemplated
by this Article shall name Lessor and Robert P. Johnson, and
Lessee and any mortgagee as insureds or additional named insured
and loss payee, as their respective interests may appear, and
shall provide that the policies cannot be canceled, changed,
terminated, or modified in a manner that materially affects the
insurance required hereunder without thirty (30) days written
notice to the parties. All insurance companies must have an A.M.
Best rating of "Good" or better. Lessee has provided Lessor with
a legible copy of the applicable insurance certificate(s) and
will provide Lessor with copies of any changes thereto and shall
provide evidence no less than thirty (30) days prior to the
expiration thereof of the renewal thereof and the renewal and
existence of requisite public liability insurance as by current
Certificates of Insurance.
(E) Lessee shall defend, indemnify, and hold Lessor
harmless against any and all claims, damages, and lawsuits
arising after the Occupancy Date of this Lease and any orders,
decrees or judgments which may be entered therein, brought for
damages or alleged damages resulting from any injury to person or
property or from loss of life sustained in or about the Leased
Premises, and Lessee agrees to save Lessor harmless from, and
indemnify Lessor against, any and all injury, loss, or damage, of
whatever nature, to any person or property caused by, or
resulting from any act, omission, or negligence of Lessee or any
employee or agent of Lessee. In addition, Lessee hereby releases
Lessor from any and all liability for any loss or damage caused
by fire or any of the extended coverage casualties, even if such
fire or other casualty shall be brought about by the negligence
(but not the gross negligence or intentional or willful
misconduct or malice) of Lessor.
(F) Lessor hereby waives any and all rights that it may
have to recover from Lessee damages for any loss occurring to the
Leased Premises by reason of any act or omission of Lessee;
provided, however, that this waiver is limited to those losses
for which Lessor is compensated by its insurers. Lessee hereby
waives any and all right that it may have to recover from Lessor
damages for any loss occurring to the Leased Premises by reason
of any act or omission of Lessor; provided, however, that this
waiver is limited to those losses for which Lessee is compensated
by its insurers.
ARTICLE 6. TAXES, ASSESSMENTS AND UTILITIES
(A) Lessee shall be liable, and agrees to pay the charges
for, all public utility services rendered or furnished to the
Leased Premises, including heat, water, gas, electricity, sewer,
sewage treatment facilities and the like, all personal property
taxes, real estate taxes, special assessments, and municipal or
government charges, general, ordinary and extraordinary, of every
kind and nature whatsoever, which may be levied, imposed, or
assessed against the Leased Premises, or upon any improvements
thereon, at any time after the Occupancy Date of this Lease and
prior to the expiration of the term hereof, or any Renewal Term.
(B) Lessee shall pay all real estate taxes, assessments
for public improvements or benefits, and other governmental
impositions, duties, and charges of every kind and nature
whatsoever which shall or may, during the term of this Lease, be
charged, laid, levied, assessed, or imposed upon, or become a
lien or liens upon the Leased Premises or any part thereof or
upon the rents payable hereunder, except for taxes based solely
upon the income of Lessor. Such payments shall be considered as
rent paid by Lessee in addition to the Rent defined at Article 4
hereof. Lessee shall be deemed to have complied with the
foregoing covenant if payment is permitted without penalty or
interest, or before the same shall become a lien upon the Leased
Premises. If by law any real estate taxes, assessments for public
improvements or benefits, or other governmental impositions,
duties, and charges of every kind and nature whatsoever may at
the option of the taxpayer be paid in installments (whether or
not interest shall accrue on the unpaid balance), Lessee may
exercise the option to pay the same in installments and shall pay
such installments as they become due during the term of this
Lease. Lessee shall not be liable for installments which come due
after the termination date of the Lease. If due to a change in
the method of taxation, a franchise tax, rental tax, or income or
profit tax shall be levied against Lessor in substitution for or
in lieu of any tax which would otherwise constitute a real estate
tax, such tax shall be deemed a real estate tax for the purposes
herein and shall be paid by Lessee.
(C) All real estate taxes, assessments for public
improvements or benefits, water rates and charges, sewer rents,
and other governmental impositions, duties, and charges which
shall become payable for the first and last tax years of the term
hereof shall be apportioned pro rata between Lessor and Lessee in
accordance with the respective number of months during which each
party shall be in possession of the Leased Premises in said
respective tax years. For the purposes of this provision, all
personal property taxes, real estate taxes and special
assessments shall be deemed to have been assessed in the year
that the first payment or any installment thereof is due.
(D) Lessee shall have the right to contest or review by
legal proceedings or in such other manner as may be legal (which,
if instituted, shall be conducted solely at Lessee's own expense)
any tax, assessment for public improvements or benefits, or other
governmental imposition aforementioned, at any time until the
property is subject to levy or execution. All such proceedings
shall be begun as soon as reasonably possible after the
imposition or assessment of any contested items and shall be
prosecuted to final adjudication with reasonable dispatch. In the
event of any reduction, cancellation, or discharge, Lessee shall
pay the amount that shall be finally levied or assessed against
the Leased Premises or adjudicated to be due and payable, and, if
there shall be any refund payable by the governmental authority
with respect thereto, Lessee shall be entitled to receive and
retain the same, subject, however, to apportionment as provided
during the first and last years of the term of this Lease.
(E) Lessor, within sixty (60) days after notice to Lessee
if Lessee fails to commence such proceedings, may, but shall not
be obligated to, contest or review by legal proceedings, or in
such other manner as may be legal, and at Lessor's own expense,
any tax, assessments for public improvements and benefits, or
other governmental imposition aforementioned, which shall not be
contested or reviewed, as aforesaid, by Lessee, and unless Lessee
shall promptly join with Lessor in such contest or review, Lessor
shall be entitled to receive and retain any refund payable by the
governmental authority with respect thereto.
(F) Lessor shall not be required to join in any proceeding
referred to in this Article, unless in Lessee's reasonable
opinion, the provisions of any law, rule, or regulation at the
time in effect shall require that such a proceeding be brought by
and/or in the name of Lessor, in which event Lessor shall upon
written request, join in such proceedings or permit the same to
be brought in its name.
ARTICLE 7. ASSIGNMENT AND SUBLETTING
So long as Lessee shall remain fully liable for the
performance of all obligations of any lessee under this Lease,
and if Lessee provides notice and true and complete copies of all
assignments or sublet agreements to Lessor, then Lessee may
assign or sublet this Lease or the Premises without the prior
permission of Lessor. Lessee shall, prior to the effective date
thereof deliver to Lessor executed counterparts of any such
agreement and of all ancillary agreements with the proposed
assignee or sublessee, as applicable. Lessor shall have the right
to require all rental payable to Lessee under any such subletting
or assignment to be payable to Lessor.
ARTICLE 8. REPAIRS AND MAINTENANCE
(A) Lessee covenants and agrees to keep and maintain in
good order, condition and repair the interior and exterior of the
Leased Premises during the term of the Lease, and further agrees
that Lessor shall be under no obligation to make any repairs or
perform any maintenance to the Leased Premises. Lessee covenants
and agrees that it shall be responsible for all repairs,
alterations, replacements, or maintenance of, including but
without limitation, interior and exterior portions of all doors,
door checks and operators, windows, plate glass, plumbing, water
and sewage facilities, fixtures, electrical equipment, interior
walls, ceilings, signs, interior building appliances and similar
equipment, heating and air conditioning equipment, and further
agrees to be replace any of said equipment when necessary. Lessee
further agrees to be responsible for, at its own expense, snow
removal, lawn maintenance, landscaping, maintenance of the
parking lot (including parking lines, seal coating, and blacktop
surfacing), and other similar items.
(B) If after written notice and a 90 day cure period
(except in the event of emergencies), Lessee refuses or neglects
to commence or complete repairs promptly and adequately, Lessor
may cause such repairs to be made, but shall not be required to
do so, and Lessee shall pay the cost thereof to Lessor upon
demand. It is understood that Lessee shall pay all expenses and
maintenance and repair during the term of this Lease. If Lessee
is not then in default hereunder, Lessee shall have the right to
make repairs and improvements to the Leased Premises without the
consent of Lessor if such repairs and improvements do not exceed
$50,000 provided such repairs or improvements do not affect the
structural integrity of the Leased Premises. Any repairs or
improvements in excess of $50,000 or affecting the structural
integrity of the Leased Premises may be done only with the prior
written consent of Lessor, such consent not to be unreasonably
withheld. All alterations and additions to the Leased Premises
shall be made in accordance with all applicable laws and shall
remain for the benefit of Lessor. Lessee further agrees, in the
event of making such alterations as herein provided, to indemnify
and save harmless Lessor from all expense, liens, claims or
damages to either persons or property or the Leased Premises
arising out of or resulting from the undertaking or making of
said repairs, improvements, alterations or additions, or Lessee's
failure to make said repairs, improvements, alterations or
additions.
ARTICLE 9. COMPLIANCE WITH LAWS AND REGULATIONS
Lessee will materially comply with all statutes, ordinances,
rules, orders, regulations and requirements of all federal,
state, city and local governments, and with all rules, orders
and regulations of the applicable Board of Fire Underwriters
which affect the use of the improvements. Lessee will materially
comply with all easements, restrictions, and covenants of record
against or affecting the Leased Premises required for operation
of the Leased Premises in accordance with Article 14 hereof.
ARTICLE 10. SIGNS
Lessee shall have the right to install and maintain a sign
or signs advertising Lessee's business, provided that the signs
conform to law, and further provided that the sign or signs
conform specifically to the written requirements of the
appropriate governmental authorities.
ARTICLE 11. SUBORDINATION
(A) Lessor reserves the right and privilege to subject and
subordinate this Lease at all times to the lien of any mortgage
or mortgages now or hereafter placed upon Lessor's interest in
the Leased Premises and on the land and buildings of which said
premises are a part, or upon any buildings hereafter placed upon
the land of which the Leased Premises are a part, and to any and
all advances to be made under such mortgages, and all renewals,
modifications, extensions, consolidations, and replacements
thereof, provided such a mortgagee shall execute a reasonably
appropriate subordination, attornment and non-disturbance
agreement (which shall include the right to quiet enjoyment).
(B) Lessee covenants and agrees to execute and deliver,
upon demand, such further reasonable instrument or instruments
subordinating this Lease on the foregoing basis to the lien of
any such mortgage or mortgages as shall be desired by Lessor and
any mortgages or proposed mortgagees.
ARTICLE 12. CONDEMNATION OR EMINENT DOMAIN
(A) If the whole of the Leased Premises are taken by any
public authority under the power of eminent domain, or by private
purchase in lieu thereof, then this Lease shall automatically
terminate upon the date possession is surrendered, and Rent shall
be paid up to that day. If any part of the Leased Premises shall
be taken so as to reduce the licensed capacity of the Premises as
a daycare facility by more than 10%, then Lessee shall have the
right to terminate this Lease on thirty (30) days notice to
Lessor if given within ninety (90) days after the date of such
taking. In the event that this Lease shall terminate or be
terminated in accordance with this section, the Rent shall, if
and as necessary, be paid up to the day that possession of the
Leased Premises was surrendered.
(B) If any part of the Leased Premises shall be taken such
that it does not, reduce the licensed capacity of the facility by
more than 10%, then Lessee shall, using proceeds of the award
from the taking authority, restore the remaining portion of the
Leased Premises to the extent necessary to render it satisfactory
to Lessee and reasonably suitable for the purposes for which it
was leased. Lessee shall make all repairs to the building in
which the Leased Premises is located to the extent necessary to
constitute the building a complete architectural unit, provided,
however, that such work shall not exceed the scope of the work
required to originally construct the building. Provided, further,
the cost thereof to Lessee shall not exceed the proceeds of its
condemnation award, all to be done without any adjustments in
rent to be paid by Lessee. Lessor agrees to make the condemnation
proceeds available to Lessee for restoration or repair pursuant
to this section.
(C) Subject to Article 12(B) above, all compensation
awarded or paid upon such total or partial taking of the Leased
Premises shall belong to and be the property of Lessor without
any participation by Lessee, whether such damages shall be
awarded as compensation for diminution in value to the leasehold
or to the fee of the premises herein leased. Nothing contained
herein shall be construed to preclude Lessee from prosecuting any
claim directly against the condemning authority in such
proceedings for loss of business, damage to or cost of removal of
or for the value of stock, trade fixtures, furniture, and other
personal property belonging to Lessee; provided, however, that no
such claim shall diminish or otherwise adversely affect Lessor's
award or the award of any fee mortgagee. If a separate award
shall be made representing the difference between the value of
the leasehold estate and the fair market value of a comparable
leasehold estate, Lessee shall be entitled to the same; provided,
however, that Lessor shall be under no obligation to pursue such
award on behalf of Lessee
ARTICLE 13. RIGHT TO INSPECT
Lessor reserves the right to enter upon, inspect and examine
the Leased Premises at any time during business hours, and Lessee
agrees to allow Lessor free access to the Leased Premises to
show the premises upon a minimum of 48 hours prior notice to
Lessee. Lessor will not enter into the Leased Premises for
purposes of this section unless accompanied by a representative
of Lessee and Lessee does hereby agree to provide such
representative upon request by Lessor, such request given not
less than 48 hours in advance. Upon default by Lessee or at any
time within ninety (90) days of the expiration or termination of
the Lease, Lessee agrees to allow Lessor to then place "For Sale"
or "For Rent" signs on the Leased Premises.
ARTICLE 14. USE OF LEASED PREMISES
(A) Lessee agrees and warrants that the Leased Premises
will be used only for lawfully permitted uses which do not
diminish the value of the Leased Premises.
ARTICLE 15. DESTRUCTION OF PREMISES
(A) If, during the term of this Lease, the Leased Premises
are totally or partially destroyed by fire or the elements, so as
to render the premises wholly unfit for occupancy, or make it
impossible in the opinion of a licensed third party arbitrator
knowledgeable in the child care business reasonably acceptable
to Lessee and Lessor, for Lessee to conduct its business therein,
then either Lessor or Lessee shall have the right to terminate
this Lease from the date of such damage or destruction by giving
written notice. The parties agree to use reasonable promptness to
obtain the opinion of such licensed third party arbitrator. Upon
the giving of such notice, Lessee shall immediately surrender the
Leased Premises and all interest therein to Lessor, and in case
of any such termination, Lessor may re-enter and repossess the
Leased Premises and may dispossess all parties then in possession
thereof. If not otherwise terminated, in the event the Leased
Premises shall be repaired, restored, and rebuilt by Lessee with
the use of insurance proceeds (which Lessor shall cooperate to
make available), but otherwise at its own sole cost and expense,
within one hundred eighty (180) days from the date of
destruction, then all rents payable by Lessee shall be abated
during the period of repair and restoration to the extent Lessor
shall be compensated by the proceeds of rents loss insurance. In
no event shall Lessor be required to provide its own money for
the repair or restoration of the Leased Premises other than the
net proceeds of moneys received by it from any insurance policy
or policies covering such loss or damages. Lessee shall be liable
for repair of the Leased Premises with all reasonable speed, and
the rents shall recommence on the date that the repairs are
completed. Lessee shall be under no obligation to so repair
during the last five (5) years of the term of the Lease, or as
extended, but if Lessee shall desire to rebuild during the last
12 months of the Lease term, Lessor will make insurance proceeds
available to rebuild the Leased Premises conditioned upon Lessee
then exercising its next renewal option under the Lease. Lessor
will make insurance proceeds available to rebuild the Leased
Premises in the event Lessee rebuilds, except as stated above.
(B) If the damage does not, in the opinion of a licensed
third party arbitrator reasonably acceptable to Lessee and
Lessor, render the Leased Premises unfit for occupancy, then
Lessor agrees that the damage shall be repaired as soon as
practicable and in that case, Lessee shall pay full rent during
the repair period. All repairs shall be paid for by Lessee out of
any insurance proceeds received (which Lessor shall cooperate to
make available), but if the insurance proceeds are insufficient
to rebuild or repair the Leased Premises according to the
original plans and specifications, whether repair or restoration
is commenced pursuant to paragraph A or B hereof, then Lessee
agrees to pay all additional amounts that are required to rebuild
the building in accordance with the original plans and
specifications. All improvements or betterments placed by Lessee
on the demised premises shall, however, in any event, be repaired
and replaced by Lessee at its own expense and not at the expense
of Lessor. The purpose of this Article is to require Lessee to
carry insurance coverage on the Leased Premises sufficient to
rebuild the improvements in the event of damage or destruction.
Lessee shall be under no obligation to so rebuild during the last
five (5) years of the term, as extended, as the case may be, but
if Lessee shall desire to rebuild during the last 12 months of
the Lease term, Lessor will make insurance proceeds available to
rebuild the Leased Premises conditioned upon Lessee then
exercising its next renewal option under the Lease. Lessor will
make insurance proceeds available to rebuild the Leased Premises
in the event Lessee rebuilds, except as stated above.
Risk that the insurance company shall be insolvent or shall
refuse to make insurance proceeds available shall be with Lessee.
The Leased Premises shall be so restored or rebuilt so as to be
of at least equal value and substantially the same character as
prior to such damage or destruction. If the insurance proceeds
are less than $100,000 they shall be paid to Lessee for such
repair and restoration. If the insurance proceeds are greater
than or equal to $100,000 they shall be deposited by Lessee and
Lessor into a customary construction escrow at a nationally
recognized title insurance company, or at Lessee's option, with
Lessor ("Escrowee") and shall be made available from time to time
to Lessee for such repair and restoration. Such proceeds shall be
disbursed in conformity with the terms and conditions of a
commercially reasonable construction loan agreement. Lessee
shall, in either instance, deliver to Lessor or Escrowee (as the
case may be) satisfactory evidence of the estimated cost of
completion together with such architect's certificates, waivers
of lien, contractor's sworn statements and other evidence of cost
and of payments as the Lessor or Escrowee may reasonably require
and approve. If the estimated cost of the work exceeds One
Hundred Thousand Dollars ($100,000), all plans and specifications
for such rebuilding or restoration shall be subject to the
reasonable approval of Lessor.
ARTICLE 16. ACTS OF DEFAULT
(A) Each of the following shall be deemed a default by
Lessee and a breach of this Lease:
1. Failure to pay the Rent, or any monetary
obligation herein reserved, (and to be considered to
be rent for the purposes of this Lease) or any part
thereof, within five (5) business days after written
notice from Lessor that the same shall be due and
payable. Provided, however, that interest and
penalties for failure to pay rent when due shall
accrue from the first date such rent was due and
payable.
2. Failure to do, observe, keep and perform
any of the material non-monetary terms, covenants,
conditions, agreements and provisions in this Lease
to be done, observed, kept and performed by Lessee
within 30 days after written notice of such default
(or within a reasonable time thereafter if the
default is incapable of cure within 30 days and
Lessee is diligently pursuing a reasonable course of
action to cure such default.
3. The abandonment (defined herein as the
leaving of the Leased Premises without paying rent,
without maintaining and without the intent of
returning) of the Premises by Lessee, the
adjudication of Lessee as a bankrupt, the making by
Lessee of a general assignment for the benefit of
creditors, the taking by Lessee of the benefit of
any insolvency act or law, the appointment of a
permanent receiver or trustee in bankruptcy for
Lessee property, or the appointment of a temporary
receiver which is not vacated or set aside within
sixty (60) days from the date of such appointment.
ARTICLE 17. TERMINATION FOR DEFAULT
In the event of any uncured default by Lessee and at any
time thereafter, Lessor may serve a written notice upon Lessee
that Lessor elects to terminate this Lease upon a specified date
not less than thirty (30) days after the date of serving such
notice of termination, and this Lease shall then terminate on the
date so specified, provided, however, that Lessee shall have
continuing liability for future rents for the remainder of the
original term and any exercised renewal term as set forth in
Article 19, notwithstanding any earlier termination of the Lease
hereunder, preserving unto Lessor the benefit of its bargained-
for rental payments.
ARTICLE 18. LESSOR'S RIGHT OF RE-ENTRY
In the event that this Lease shall be terminated as herein
provided, or by summary proceedings or otherwise, or in the event
of an uncured default hereunder by Lessee, or in the event that
the premises or any part thereof, shall be abandoned by Lessee,
(subject to rights to cure as provided in Article 16) Lessor or
its agents, servants or representatives, may immediately or at
any time thereafter, re-enter and resume possession of the
premises or any part thereof, and remove all persons and property
therefrom, in accordance with local law either by summary
dispossess proceedings or by a suitable action or proceeding at
law, without being liable for any damages therefor.
ARTICLE 19. LESSEE'S CONTINUING LIABILITY
(A) Should Lessor elect to re-enter as provided in this
Lease or should it take possession pursuant to legal proceedings
or pursuant to any notice provided for by law, it may either (i)
terminate this Lease or (ii) it may from time to time, without
terminating the contractual obligation of Lessee to pay Rent
under this Lease, make such commercially reasonable alterations
and repairs as may be necessary to relet the Leased Premises or
any part thereof for such Term or Renewal Terms, at such
commercially reasonable rental or rentals, and upon such other
commercially reasonable terms and conditions as Lessor in its
sole discretion may deem advisable.
(B)Upon each such reletting, without termination the
contractual obligation of Lessee to pay Rent under
this Lease, all rentals received by Lessor shall be
applied as follows:
1. First, to the payment of any indebtedness
other than rent due hereunder from Lessee to Lessor;
2. Second, to the payment of any costs and
expenses of such reletting, including brokerage fees
and reasonable attorney's fees and of costs of such
alterations and repairs;
3. Third, to the payment of rent due and unpaid
hereunder;
4. The residue, if any, shall be held by
Lessor and applied in payment of future rent as the
same may become due and payable hereunder. Then any
residue will be used first to reimburse Lessor (or
Lessee if previously paid by Lessee for costs and
expenses per Article 19(B)2 above) for such costs and
expenses incurred per Article 19(B)2 above until
repaid, then any excess shall remain with Lessor.
If such rentals received from such reletting during any
month are less than that to be paid during that month by Lessee
hereunder, Lessee shall pay any such deficiency to Lessor. Such
deficiency shall be calculated and paid monthly. No such re-entry
or taking possession of such Leased Premises by Lessor shall be
construed as an election on its part to terminate this Lease
unless a written notice of such intention be given to Lessee.
(C) Notwithstanding any such reletting without
termination, Lessor may at any time thereafter elect to terminate
this Lease for any breach.
(D) In addition to any other remedies Lessor may have with
this Article 19, Lessor may recover from Lessee all damages it
may incur by reason of any breach, including the cost of
recovering and reletting the Leased Premises, reasonable
attorney's fees, and including the present value (discounted at a
rate of 8% per annum) of the excess of the amount of rent and
charges equivalent to rent reserved in this Lease for the
remainder of the Term over the then reasonable rental value of
the Leased Premises (or the actual rents receivable by Lessor, if
relet) for the remainder of the Term, all of which amounts shall
be immediately due and payable from Lessee to Lessor in full. In
determining the rent which would be payable by Lessee hereunder,
subsequent to default, the total Rental for each year of the
unexpired Term shall be equal to the average total Rental that
would be payable by Lessee as set forth in Article 4 above. In
the event that the rent obtained from such alternative or
substitute tenant is more than the rent which Lessee is obligated
to pay under this Lease, then such excess shall be paid to
Lessor provided that Lessor shall credit such excess against the
outstanding obligations of Lessee due pursuant hereto, if any.
(E) Lessor will use its reasonable efforts to attempt to
mitigate damages of Lessee, but Lessor shall have absolutely no
obligation to expend any moneys in the way of tenant inducements
or in the refurbishment of the Leased Premises for any use other
than that for which the Leased Premises were being used by
Lessee. It is the object and purpose of this Article 19 that
Lessor shall be kept whole and shall suffer no damage by way of
non-payment of rent or by way of diminution in rent. Lessee
waives and will waive all rights to trial by jury in any summary
proceedings to recover possession of the Leased Premises which
may hereafter be instituted by Lessor.
ARTICLE 20. PERSONALTY, FIXTURES AND EQUIPMENT
(A) All building fixtures, building machinery, and
building equipment used in connection with the operation of the
Leased Premises including, but not limited to, heating, lighting,
ventilating, plumbing, walk-in refrigerators, walk-in freezers,
and air conditioning systems shall be the property of Lessor. All
trade fixtures and all other fixtures and articles of personal
property owned by Lessee shall remain the property of Lessee.
(B) Lessee shall furnish and pay for any and all
equipment, furniture, trade fixtures, and signs, except for such
items, if any, described in Article 20(A) above. Lessor agrees
that it has no interest in the personal property of Lessee.
(C) At the end of the term of this Lease, all personal
property and trade fixture of Lessee may be removed from the
Leased Premises by Lessee, however, removal of such fixtures may
proceed only after five (5) business days prior written notice to
Lessor of the time of such removal and notice of the
identification of the parties performing such removal. All damage
to the Leased Premises which may be caused by the removal of such
property shall be promptly paid for by Lessee.
ARTICLE 21. LIENS
Lessee shall not do or cause anything to be done whereby the
Leased Premises may be encumbered by any mechanic's or other
liens. Whenever and as often as any mechanic's or other lien is
filed against said Leased Premises purporting to be for labor or
materials furnished or to be furnished to Lessee, within thirty
(30) days from the date of the filing of said mechanic's or other
lien (or such earlier period if required by law prevent default
or attachment of the lien) and delivery of notice thereof to
Lessee of Lessee's obligation under this Lease, Lessee shall
remove the lien of record by payment or by bonding with a surety
company authorized to do business in the state in which the
property is located, or other security reasonable acceptable to
Lessor. Should Lessee fail to take the foregoing steps within
said thirty (30) day period, then Lessor shall have the right,
among other things, to pay said lien without inquiring into the
validity thereof, and Lessee shall forthwith reimburse Lessor for
the total expense incurred by it in discharging said lien as
additional rent hereunder, subject to notice to Lessee and a 10
business day cure period.
ARTICLE 22. NO WAIVER BY LESSOR EXCEPT IN WRITING
No agreement to accept a surrender of the Leased Premises or
termination of this Lease shall be valid unless in writing signed
by Lessor. The delivery of keys to any employee of Lessor or
Lessor's agents shall not operate as a termination of the Lease
or a surrender of the premises. The failure of Lessor to seek
redress for violation of, any rule or regulation, shall not
prevent a subsequent act, which would have originally constituted
a violation, from having all the force and effect of an original
violation. No payment by Lessee or receipt by Lessor of a lesser
amount than the rent herein stipulated shall be deemed to be
other than on account of the earliest stipulated rent, nor shall
any endorsement or statement on any check nor any letter
accompanying any check or payment as rent be deemed an accord and
satisfaction, and Lessor may accept such check or payment without
prejudice to Lessor's right to recover the balance of such rent
or pursue any other remedy provided in this Lease. This Lease
contains the entire agreement between the parties, and any
executory agreement hereafter made shall be ineffective to
change, modify or discharge it in whole or in part unless such
executory agreement is in writing and signed by the party
against whom enforcement of the change, modification or
discharge is sought.
ARTICLE 23. QUIET ENJOYMENT
Lessor covenants that Lessee, upon paying the rent set forth
in Article 4 and all other sums herein reserved as rent and upon
the due performance of all the terms, covenants, conditions and
agreements herein contained on Lessee's part to be kept and
performed, shall have, hold and enjoy the Leased Premises free
from molestation, eviction, or disturbance by Lessor, or by any
other person or persons lawfully claiming the same, and that
Lessor has good right to make this Lease for the full term
granted, including renewal periods.
ARTICLE 24. BREACH - PAYMENT OF COSTS AND ATTORNEYS' FEES
The non-prevailing party agrees to pay and discharge all
reasonable costs, attorneys' fees and expenses that shall be
incurred by the prevailing party in enforcing the covenants,
conditions and terms of this Lease or defending against an
alleged breach.
ARTICLE 25. ESTOPPEL CERTIFICATES
Either party to this Lease will, at any time from time to
time, upon not less than ten (10) business days prior request by
the other party, execute, acknowledge and deliver to the
requesting party a statement in writing, executed by an executive
officer of such party, certifying (a) that this Lease is
unmodified (or if modified then disclosure of such modification
shall be made); (b) that this Lease is in full force and effect;
(c) that the date to which the rent and other charges have been
paid; and (d) that to the knowledge of the signer of such
certificate the other party is not in default in the performance
of any covenant, agreement or condition contained in this Lease,
or if a default does exist, specifying each such default of which
the signer may have knowledge. It is intended that any such
statement delivered pursuant to this Article may be relied upon
by any prospective purchaser or mortgagee of the Leased Premises
or any assignee of such mortgagee or a purchaser of the leasehold
estate.
ARTICLE 26. FINANCIAL STATEMENTS
Lessee will, within ninety (90) days after the end of
Lessee's fiscal year during the term of this Lease, furnish to
the Lessor financial statements of the Lessee. The financial
statements shall be certified by an officer of Lessee or if
financial statements are prepared by an independent certified
public accountant then such accountant's report shall be provided
and such report shall be prepared in conformity with generally
accepted accounting principals with auditor's opinion and
footnotes included therein. The financial statements shall
include a balance sheet, and related statement of income.
ARTICLE 27. MORTGAGE
Lessee does hereby agree to make reasonable modifications of
this Lease requested by any Mortgagee of record from time to time
provided such modifications are not material and do not increase
any of the rents or modify any of the business elements of this
Lease.
ARTICLE 28. OPTION TO RENEW
If this Lease is not previously canceled or terminated and
if Lessee is not then in material default hereunder, then Lessee
shall have three (3) separate individual options to renew this
Lease upon the same conditions and covenants contained in this
Lease for three separate individual (3) consecutive periods of
five (5) years each (singularly "Renewal Term").
The first Renewal Term would commence on the date the
original Term expires and successive Renewal Terms would commence
on the last day of the then expiring Renewal Term. Lessee must
give 90 days written notice to Lessor of its intent to exercise
this option prior to the expiration of the original Term of this
Lease or any Renewal Term, as the case may be.
The rent during the Renewal Term or Terms shall increase
each Lease Year of the Renewal Term at the same rate as set forth
in Article 4 above.
ARTICLE 29. MISCELLANEOUS PROVISIONS
(A) All written notices shall be given by certified mail
or express courier. Notices to Lessor shall be addressed to the
person and address given on the first page hereof. Lessor and
Lessee may, from time to time, change these addresses by
notifying each other of this change in writing.
(B) The terms, conditions and covenants contained in this
Lease and any riders and plans attached hereto shall bind and
inure to the benefit of Lessor and Lessee and their respective
successors, heirs, legal representatives, and assigns.
(C) This Lease shall be governed by and construed under
the laws of the State where the premises are situated.
(D) In the event that any provision of this Lease shall be
held invalid or unenforceable, no other provisions of this Lease
shall be affected by such holding, and all of the remaining
provisions of this Lease shall continue in full force and effect
pursuant to the terms hereof.
(E) The paragraph captions are inserted only for
convenience and reference, and are not intended, in any way, to
define, limit, describe the scope, intent, and language of this
Lease or its provisions.
(F) In the event Lessee remains in possession of the
premises herein leased after the expiration of this Lease and
without the execution of a new lease, it shall be deemed to be
occupying said premises as a tenant from month-to-month, subject
to all the conditions, provisions, and obligations of this Lease
insofar as the same can be applicable to a month-to-month tenancy
except that the monthly installment of Rental shall be increased
25% from the amount due on the last month prior to such
expiration.
(G) If any installment of rent (whether lump sum, monthly
installments, or any other monetary amounts required by this
Lease to be paid by Lessee and deemed to constitute Rental
hereunder) shall not be paid within 10 days when due, Lessor
shall have the right to charge Lessee a late charge of $250 per
month for unpaid rent for each month that any amount of rent
installment remains unpaid. Said late charge shall commence after
such installment is due and continue until said installment,
interest and all accrued late charges are paid in full.
(H) Any part of the Leased Premises may be conveyed by
Lessor for private easement purposes at any time provided Lessee
gives written consent to such private easement. In the event that
the private easement affects or is related to the playground or
the building on the Leased Premises, then Lessee's consent may be
arbitrarily withheld in Lessee's sole and absolute discretion. If
the private easement does not affect the playground or building
on the Leased Premises, then Lessee's consent may not be
commercially unreasonably withheld. In such event that any part
of the Leased Premises are so conveyed, Lessor shall, at its own
cost and expense, restore the remaining portion of the Leased
Premises to the extent necessary to render it reasonably suitable
for the purposes for which it was leased, all to be done without
adjustments in rent to be paid by Lessee. All proceeds from any
conveyance of a private easement shall belong solely to Lessor.
(I) For the purpose of this Lease, the term "rent" shall
be defined as Rental under Article 4, and any other monetary
amounts required by this Lease to be paid by Lessee.
ARTICLE 30. REMEDIES
NON-EXCLUSIVITY. Notwithstanding anything contained herein
it is the intent of the parties that the rights and remedies
contained herein shall not be exclusive but rather shall be
cumulative along with all of the rights and remedies of the
parties which they may have at law or equity.
ARTICLE 31. HAZARDOUS MATERIALS INDEMNITY
Lessee covenants, represents and warrants to Lessor, its
successors and assigns, (i) that it has not used or permitted and
will not use or permit the Leased Premises to be used, whether
directly or through contractors, agents or tenants, and to the
best of Lessee's knowledge and except as disclosed to Lessor in
writing, the Leased Premises has not at any time been used for
the generating, transporting, treating, storage, manufacture,
emission of, or disposal of any dangerous, toxic or hazardous
pollutants, chemicals, wastes or substances as defined in the
Federal Comprehensive Environmental Response Compensation and
Liability Act of 1980 ("CERCLA"), the Federal Resource
Conservation and Recovery Act of 1976 ("RCRA"), or any other
federal, state or local environmental laws, statutes,
regulations, requirements and ordinances ("Hazardous Materials");
(ii) that there have been no investigations or reports involving
Lessee, or the Leased Premises by any governmental authority
which in any way pertain to Hazardous Materials (iii) that the
operation of the Leased Premises has not violated and is not
currently violating any federal, state or local law, regulation,
ordinance or requirement governing Hazardous Materials; (iv) that
the Leased Premises is not listed in the United States
Environmental Protection Agency's National Priorities List of
Hazardous Waste Sites nor any other list, schedule, log,
inventory or record of Hazardous Materials or hazardous waste
sites, whether maintained by the United States Government or any
state or local agency; and (v) that the Leased Premises will not
contain any formaldehyde, urea or asbestos, except as may have
been disclosed in writing to Lessor by Lessee at the time of
execution and delivery of this Lease. Lessee agrees to indemnify
and reimburse Lessor, its successors and assigns, for:
(a) any breach of these representations and warranties,
and
(b) any loss, damage, expense or cost arising out of
or incurred by Lessor which is the result of a breach
of, misstatement of or misrepresentation of the above
covenants, representations and warranties, and
(c) any and all liability of any kind whatsoever which
Lessor may, for any cause and at any time, sustain or
incur by reason of Hazardous Materials, released or
placed on the Leased Premises during the term of the
Lease,
together with all reasonable attorneys' fees, costs and
disbursements incurred in connection with the defense of any
action against Lessor arising out of the above. These covenants,
representations and warranties shall be deemed continuing
covenants, representations and warranties for the benefit of
Lessor, and any successors and assigns of Lessor and shall
survive expiration or sooner termination of this Lease. The
amount of all such indemnified loss, damage, expense or cost,
shall bear interest thereon at the rate of interest equal to the
rate changed on overdue payment in Section 4(E) and shall become
immediately due and payable in full on demand of Lessor, its
successors and assigns.
ARTICLE 32. ESCROWS
If Lessee has defaulted in payment of any taxes, or if
Lessee shall be in default under any of the items of this Lease,
or if Lessor's Mortgagee shall require Lessor to escrow the
amount of real estate taxes or assessments on a monthly basis,
then in either event, at Lessor's option, Lessee shall deposit
with Lessor on the first day of each and every month thereafter,
an amount equal to one-twelfth (1/12th) of the estimated annual
real estate taxes, assessments ("Charges") due on the Leased
Premises. From time to time out of such deposits Lessor will,
upon the presentation to Lessor by Lessee of the bills therefor,
pay the Charges or will upon presentation of receipted bills
therefor, reimburse Lessee for such payments made by Lessee. In
the event the deposits on hand shall not be sufficient to pay all
of the estimated Charges when the same shall become due from time
to time or the prior payments shall be less than the currently
estimated monthly amounts, then Lessee shall pay to Lessor on
demand any amount necessary to make up the deficiency. The excess
of any such deposits shall be credited to subsequent payments to
be made for such items. If a default or an event of default shall
occur under the terms of this Lease, Lessor may, at its option,
without being required so to do, apply any Deposit on hand to
cure the default, in such order and manner as Lessor may elect.
ARTICLE 33. NET LEASE
Notwithstanding anything contained herein to the contrary it
is the intent of the parties hereto that this Lease shall be a
net lease and that the rent defined pursuant to Paragraph 4
should be a net rent paid to Lessor. Any and all other expenses
including but not limited to, maintenance, repair, insurance,
taxes, and assessments, shall be paid by Lessee.
ARTICLE 34. RIGHT TO SUBSTITUTION
If Lessee determines that it is economically unfeasible to
continue operations in or at the Leased Premises, Lessee may
exchange the Leased Premises for another of like kind, value,
size and demographic location acceptable to Lessor. If Lessor
elects to accept a replacement property in exchange for the
Leased Premises owned by Lessor, Lessee shall provide a
replacement property of comparable size, cost, location and
ownership interest in a Section 1031 "like-kind" exchange and
shall lease the replacement Premises from Lessor on identical
terms as contained in the lease for the original Leased Premises.
All costs associated with making such exchange, including the
provision of surveys, title, environmental and all other
documentation normally required or obtained by Lessor, shall be
paid by Lessee.
IN WITNESS WHEREOF, Lessor and Lessee have respectively
signed and sealed this Lease as of the day and year first above
written.
LESSEE:
ARAMARK EDUCATIONAL RESOURCES,
INC., d/b/a CHILDREN'S WORLD
LEARNING CENTERS, f/k/a
CHILDREN'S WORLD LEARNING
CENTERS, INC a Delaware
corporation
Attest: /s/ Henry C Tiberi
Print Name: Henry C Tiberi
By: /s/ John Rosen
Attest: /s/ John Finnemore
Print Name: John Finnemore Its: Executive Vice President
STATE OF COLORADO)
)SS.
COUNTY OF JEFFERSON)
The foregoing instrument was acknowledged before me this
12th day of July, 1999, by John Rosen, the Executive Vice
President of ARAMARK Educational Resources, Inc., d/b/a
Children's World Learning Centers, f/k/a Children's World
Learning Centers, Inc., a Delaware corporation, on behalf of said
corporation.
Notary Public /s/ Tracey A Melhuish-Smith
[notary seal]
LESSOR:
AEI REAL ESTATE FUND XV LIMITED
PARTNERSHIP
By: AEI Fund Management 86-A, Inc.
Attest: /s/ Kay Johnston
Print Name: Kay Johnston
By: /s/ Robert P Johnson
Robert P. Johnson, President
Attest: /s/ Barbara J Kochevar
Print name: Barbara J Kochevar
STATE OF MINNESOTA )
)SS.
COUNTY OF RAMSEY )
The foregoing instrument was acknowledged before me the 12th
day of July, 1999, by Robert P. Johnson, the President of AEI
Fund Management 86-A, Inc., a Minnesota corporation, corporate
general partner of AEI Real Estate Fund XV Limited Partnership,
on behalf of said limited partnership.
Notary Public /s/ Michael B Daugherty
[notary seal]
EXHIBIT A
TO DEED
ARAMARK EDUCATIONAL RESOURCES, INC. (GRANTOR)
AEI REAL ESTATE FUND XV LIMITED PARTHNERSHIP (GRANTEE)
PARCEL 1: Situated in Section 18, Town 3, Range 2, Union
Township, Butler County, Ohio and being a 1.020 acre tract and
being more particularly described as follows:
Begin at a point found by measuring from the Southwest corner of
Section 18, North 02 22' 39" East, 298.55 feet along the westerly
line of said Section; thence departing said section line and
along the northerly property line of a tract owned by Diamond W.
Teal, North 81 15' 29" East, 200.74 feet to the true point of
beginning; thence from the point of beginning thus found, along a
new division line, North 81 15' 29" East, 115.28 feet to a point
on the right-of-way of Wetherington Drive, thence along said
right-of-way along a curve to the left having a radius of 430.00
feet, an arc length of 17.74 feet, (chord South 61 15' 44" East,
17.73 feet); thence departing said right-of-way, along a new
division line, South 02 22' 39" West, 358.26 feet to a point on
the northerly right-of-way line of Tylersville Road; thence along
said right-of-way, North 77 39' 02" West, 130.98 feet, thence
North 02 22' 39" East, 321.22 feet to the point of beginning
containing 1.020 acres of land, more or less.
The above description was prepared from a survey made by Jeffrey
O. Lambert, Registered Surveyor #7568 in the State of Ohio,
October 1994.
The plat of which is recorded in Volume 28 page 235 of the Butler
County Engineer's Records.
PARCEL II: Together with utility and access easement appurtenant
to Parcel I as set out in Official Record Book 5268 page 262.
PARCEL III: Together with sanitary sewer easement appurtenant to
Parcel I as set out in Official Record Book 5268 page 262.
PARCEL IV: Together with easement for emergency access as set
out in Easement Agreement recorded in Official Record Book 6057
page 1926.
Being the same premises conveyed to the Insured herein by deed
from E & H Properties, an Ohio General Partnership dated
September 26, 1996 recorded October 3, 1996 at 12:16 P.M. in
Official Record Book 6057 page 1936 Butler County, Ohio Records.
EXHIBIT B
TO
LEASE AGREEMENT
Attached to and forming a part of Lease between AEI REAL ESTATE
FUND XV LIMITED PARTNERSHIP and ARAMARK EDUCATIONAL RESOURCES,
INC., a Delaware corporation, d/b/a Children's World Learning
Centers, dated July _____, 1999.
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE is dated this ________ day of July,
1999, by and between AEI REAL ESTATE FUND XV LIMITED PARTNERSHIP
("Landlord"), whose mailing address is 1300 Minnesota World Trade
Center, St. Paul, Minnesota 55101 and ARAMARK EDUCATIONAL
RESOURCES, INC., a Delaware corporation, d/b/a Children's World
Learning Centers ("CWLC"), whose mailing address is 573 Park
Point Drive, Golden, Colorado, 80401.
Landlord has granted, demised and leased the real property and
improvements described below ("Premises") to CWLC on the
following terms and conditions:
1. DATE OF LEASE: July , 1999
2. DESCRIPTION OF PREMISES:
SEE EXHIBIT A ATTACHED HERETO AND INCORPORATED HEREIN BY
REFERENCE
also known as 7236 Tylers Corner, West Chester, Ohio
3. COMMENCEMENT DATE: July , 1999
4. TERM: Fifteen (15) years
5. RENEWAL TERMS: Three 5-year options
6. PURCHASE OPTION: N/A
7. Entry of a court order terminating Lessee's right of
possession shall be sufficient evidence of the termination of any
rights established by such Memorandum of Lease.
The purpose of this Memorandum of Lease is to give notice of
the Lease and of the rights created thereby, all of which are
hereby confirmed.
LESSEE:
ARAMARK EDUCATIONAL RESOURCES,
INC., d/b/a CHILDREN'S WORLD
LEARNING CENTERS, f/k/a
CHILDREN'S WORLD LEARNING
CENTERS, INC a Delaware
corporation
Attest:_______________________________
Print Name:___________________________ By:
__________________________
Its: __________________________
Attest:_______________________________
Print Name:___________________________
STATE OF )
)SS.
COUNTY OF )
The foregoing instrument was acknowledged before me this
______ day of July, 1999, by
____________________________________, the
______________________________________ of ARAMARK Educational
Resources, Inc., d/b/a Children's World Learning Centers, f/k/a
Children's World Learning Centers, Inc., a Delaware corporation,
on behalf of said corporation.
Notary Public _____________________________________
LESSOR:
AEI REAL ESTATE FUND XV LIMITED
PARTNERSHIP
By: AEI Fund
Management 86-A, Inc.
Attest:________________________
Print Name:____________________
By: __________________________
Robert P. Johnson, President
Attest:________________________
Print Name:____________________
STATE OF MINNESOTA )
)SS.
COUNTY OF RAMSEY )
The foregoing instrument was acknowledged before me the
day of July, 1999, by Robert P. Johnson, the President of AEI
Fund Management XV, Inc., a Minnesota corporation, corporate
general partner of AEI Real Estate Fund XV Limited Partnership,
on behalf of said limited partnership.
Notary Public _____________________________
EXHIBIT A
TO DEED
ARAMARK EDUCATIONAL RESOURCES, INC. (GRANTOR)
AEI REAL ESTATE FUND XV LIMITED PARTHNERSHIP (GRANTEE)
PARCEL 1: Situated in Section 18, Town 3, Range 2, Union
Township, Butler County, Ohio and being a 1.020 acre tract and
being more particularly described as follows:
Begin at a point found by measuring from the Southwest corner of
Section 18, North 02 22' 39" East, 298.55 feet along the westerly
line of said Section; thence departing said section line and
along the northerly property line of a tract owned by Diamond W.
Teal, North 81 15' 29" East, 200.74 feet to the true point of
beginning; thence from the point of beginning thus found, along a
new division line, North 81 15' 29" East, 115.28 feet to a point
on the right-of-way of Wetherington Drive, thence along said
right-of-way along a curve to the left having a radius of 430.00
feet, an arc length of 17.74 feet, (chord South 61 15' 44" East,
17.73 feet); thence departing said right-of-way, along a new
division line, South 02 22' 39" West, 358.26 feet to a point on
the northerly right-of-way line of Tylersville Road; thence along
said right-of-way, North 77 39' 02" West, 130.98 feet, thence
North 02 22' 39" East, 321.22 feet to the point of beginning
containing 1.020 acres of land, more or less.
The above description was prepared from a survey made by Jeffrey
O. Lambert, Registered Surveyor #7568 in the State of Ohio,
October 1994.
The plat of which is recorded in Volume 28 page 235 of the Butler
County Engineer's Records.
PARCEL II: Together with utility and access easement appurtenant
to Parcel I as set out in Official Record Book 5268 page 262.
PARCEL III: Together with sanitary sewer easement appurtenant to
Parcel I as set out in Official Record Book 5268 page 262.
PARCEL IV: Together with easement for emergency access as set
out in Easement Agreement recorded in Official Record Book 6057
page 1926.
Being the same premises conveyed to the Insured herein by deed
from E & H Properties, an Ohio General Partnership dated
September 26, 1996 recorded October 3, 1996 at 12:16 P.M. in
Official Record Book 6057 page 1936 Butler County, Ohio Records.
