UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
Commission File Number: 0-25760
X Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the Quarterly Period
ended March 31, 1996.
Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the Transition Period
From ______ to _____.
GENERAL ACCEPTANCE CORPORATION
(Exact name of Registrant as specified in its charter)
Indiana
35-1739977
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
1025 Acuff Road
Bloomington, Indiana 47404
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number: (812) 337-6000
Former address: 5015 W. State Rd. 46
Bloomington, Indiana 47404
Indicate by check mark whether the Registrant (1) has filed all reports
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant
was required to file such report(s), and (2) has been subject to such filing
requirements for the past 90 days. Yes x No ____
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Common Stock, no par value, 25,000,000 shares authorized, 6,022,000
shares issued and outstanding as of May 13, 1996.
<PAGE>
FORM 10-Q
TABLE OF CONTENTS
Page
PART I. Financial Information 3
Item 1. Financial Statements 3
Balance Sheets 3
Statements of Income 4
Statements of Cash Flows 5
Notes to Financial Statements. 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
Revenues 8
Expenses 8
Liquidity and Capital Resources.. 9
PART II. Other Information 11
Item 1. Legal Proceedings 11
Item 6. Exhibits and reports on form 8-K 11
Signatures 12
<PAGE>
PART I
ITEM 1. FINANCIAL STATEMENTS
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General Acceptance Corporation
Balance Sheets
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MARCH 31, 1996 DECEMBER 31, 1995
---------------- -------------------
(UNAUDITED) (NOTE 1)
ASSETS
Contracts receivable $ 122,751,132 $ 129,392,670
Allowance and discount available for credit losses (15,857,856) (19,512,815)
---------------- -------------------
Contracts receivable, net 106,893,276 109,879,855
Cash and cash equivalents 683,739 557,206
Repossessions 9,670,411 5,223,623
Purchased and trade automobile inventory 1,072,551 811,820
Property and equipment, net 1,884,346 1,672,475
Other assets 2,533,081 1,674,847
Taxes receivable 2,209,192 2,300,475
Deferred tax asset 2,260,000 2,260,000
Total assets $ 127,206,596 $ 124,380,301
================ ===================
LIABILITIES
Revolving line of credit $ 97,247,469 $ 94,165,243
Accounts payable and accrued expenses 1,313,003 1,605,484
Dealer participation reserves available
for credit losses 1,678,786 1,865,681
Total liabilities 100,239,258 97,636,408
STOCKHOLDERS' EQUITY
Preferred stock; no par value; authorized
shares - 5,000,000; no shares issued or outstanding --- ---
Common stock; no par value;
authorized shares - 25,000,000;
issued and outstanding shares - 6,022,000 in 1996
and 4,064,000 in 1995 29,792,573 29,792,573
Retained earnings (deficit) (2,825,235) (3,048,680)
---------------- -------------------
Total stockholders' equity 26,967,338 26,743,893
---------------- -------------------
Total liabilities and stockholders' equity $ 127,206,596 $ 124,380,301
================ ===================
<FN>
See accompanying notes.
</TABLE>
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<CAPTION>
General Acceptance Corporation
Statements of Income
(Unaudited)
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THREE MONTHS THREE MONTHS
ENDED MARCH ENDED MARCH
31,1996 31,1995
------------- -------------
Revenues:
Interest and discount $ 6,737,009 $ 4,142,595
Ancillary products 258,675 572,067
Other 453,693 299,004
------------- -------------
Total revenues 7,449,377 5,013,666
Expenses:
Interest 2,148,430 1,359,178
Salaries and employee benefits 2,282,212 914,257
Marketing 177,214 111,253
Provision for credit losses 1,233,503 397,983
Other 1,235,609 754,409
Total expenses 7,076,968 3,537,080
------------- -------------
Income before income taxes 372,409 1,476,586
Income taxes 148,964 ---
Net income $ 223,445 $ 1,476,586
============= =============
HISTORICAL PRO FORMA
------------- -------------
Income before income taxes $ 372,409 $ 1,476,586
Income taxes 148,964 590,634
Net income $ 223,445 $ 885,952
Net income per share $ .04 $ .20
Weighted average shares outstanding 6,022,000 4,519,407
============= =============
<FN>
See accompanying notes.
</TABLE>
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General Acceptance Corporation
Statements of Cash Flows
(Unaudited)
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THREE MONTHS THREE MONTHS
ENDED MARCH ENDED MARCH
31,1996 31,1995
-------------- --------------
OPERATING ACTIVITIES
Net income $ 223,445 $ 1,476,586
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation of property and equipment 140,732 55,596
Amortization of deferred discount and
acquisition costs 169,139 (38,513)
Provision for credit losses 1,233,503 397,983
Changes in operating assets and liabilities:
Increase in other assets and
taxes receivable (1,027,642) (945,453)
Increase (decrease) in accounts payable
and accrued expenses (292,481) 475,015
Net cash provided by operating activities 446,696 1,421,214
INVESTING ACTIVITIES
Cost of acquiring or originating contracts receivable (18,146,142) (18,268,853)
Principal collected on contracts receivable 15,096,356 5,090,062
Purchases of property and equipment (352,603) (279,906)
Net cash used in investing activities (3,402,389) (13,458,697)
FINANCING ACTIVITIES
Borrowings on revolving line of credit 25,268,122 21,479,189
Repayments of revolving line of credit (22,185,896) (9,227,822)
Borrowings on installment notes --- 3,747,826
Dividends paid --- (4,226,584)
Net cash provided by financing activities 3,082,226 11,772,609
-------------- --------------
Net increase (decrease) in cash and cash equivalents 126,533 (264,874)
Cash and cash equivalents at beginning of period 557,206 304,185
Cash and cash equivalents at end of period $ 683,739 $ 39,311
============== ==============
<FN>
See accompanying notes.
</TABLE>
<PAGE>
General Acceptance Corporation
Notes to Financial Statements
(Unaudited)
March 31, 1996
Note 1. Basis of Presentation
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments
(consisting of only normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three months ended
March 31, 1996 are not necessarily indicative of the results that may be
expected for the year ending December 31, 1996. The balance sheet as of
December 31, 1995 has been derived from the audited financial statements as of
that date but does not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
For further information, refer to the financial statements and footnotes
included in the Company's annual report on Form 10-K for the year ended
December 31, 1995.
Note 2. Pro Forma Financial Data
Prior to the Company's initial public offering in April 1995, it was an S
Corporation and therefore not subject to income taxes. Pro forma data is
therefore presented for 1995 to reflect a provision for income taxes as if the
Company had been subject to income taxes at an assumed combined rate of 40%.
Note 3. Net Income Per Share
The 1996 net income per share amount is based on the weighted average
number of common shares and dilutive common stock equivalents outstanding
during the period. The 1995 net income per share amount is based on the
weighted average common shares outstanding increased by the number of shares
(assumed issued at $17.00 per share) whose proceeds would have been used to
fund distributable S Corporation earnings. Pro forma net income per share for
the first quarter of 1995 does not give effect to the 1,958,000 shares of
common stock issued in connection with the Company's April 6, 1995, initial
public offering.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF
OPERATIONS
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Information regarding the components of contracts receivable, net is
presented below.
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MARCH 31, DECEMBER 31,
1996 1995
------------- --------------
Contractually scheduled payments $155,329,379 $ 165,865,851
Add (deduct):
Unearned interest income (33,025,255) (36,920,628)
Accrued interest income 353,942 298,059
Unearned insurance commissions (88,945) (128,718)
Net deferred acquisition costs 182,011 278,106
------------- --------------
Contracts receivable 122,751,132 129,392,670
Allowance and discount available for
credit losses (15,857,856) (19,512,815)
Contracts receivable, net $106,893,276 $ 109,879,855
============= ==============
</TABLE>
<TABLE>
<CAPTION>
Changes in the components of amounts available for credit losses during the first quarter of
1996 are presented below.
<S> <C> <C> <C>
ALLOWANCE AND DISCOUNT DEALER PARTICIPATION RESERVES
TOTAL
------------
Balance December 31, 1995 $ 19,512,815 $ 1,865,681 $21,378,496
Additions 3,041,589 1,134,490 4,176,079
Charge-offs, net (6,696,548) (1,321,385) (8,017,933)
Balance March 31, 1996 $ 15,857,856 $ 1,678,786 $17,356,642
======================== =============================== ============
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<TABLE>
<CAPTION>
Information on the Company's total available for credit losses and
delinquency ratio are presented below.
<S> <C> <C>
MARCH 31, 1996 DECEMBER 31, 1995
--------------- ------------------
Total available for credit losses as a
percentage of contracts receivable (1) 14.29% 16.50%
Delinquency ratio (2) 1.72% 3.60%
<FN>
Total available for credit losses is defined as the sum of allowance and
discount available for credit losses and dealer participation reserves
available for credit losses.
(2) Delinquency ratio is defined as contracts receivable, gross relating to
contracts which were contractually past due 60 days or more, as a percentage of
total contracts receivable, gross as of the end of the period indicated.
</TABLE>
<PAGE>
THREE MONTHS ENDED MARCH 31, 1996, COMPARED TO THREE MONTHS ENDED MARCH 31,
1995
Revenues
Interest and discount revenue increased from $4.1 million for the first
quarter of 1995 to $6.7 million for the first quarter of 1996, an increase of
$2.6 million, or 62.6%. The increase was due to a higher volume of contracts
purchased by the Company, and to a lesser extent, a higher volume of contracts
originated by the Company at the GAC sales lots, partially offset by a lower
average yield on contracts purchased by the Company. As of March 31, 1996,
contracts receivable totaled $122.8 million compared to $62.1 million as of
March 31, 1995. The number of active dealers (defined as dealers from whom
the Company purchased a contract that was outstanding as of the end of a
period) was 1,382 as of March 31, 1996, up from 647 as of March 31, 1995. As
of March 31, 1996, the Company was active in 19 states, up from 11 as of March
31, 1995.
The average yield on contracts receivable during the first quarter of
1995 was 23.7% compared to 21.2% for the first quarter of 1996. The decrease
was due primarily to the Company's decision to enter into agreements with its
dealers to apply the difference, if any, between the contract interest rate
and the rate determined by the Company as necessary to produce a satisfactory
return on the contract, to a dealer participation reserve available for credit
losses.
Ancillary products revenue declined from $572,000 for the first quarter
of 1995 to $259,000 for the first quarter of 1996. The decrease was
principally due to the decision by the Company to discontinue offering,
effective March 22, 1995, a Gap protection product as a result of regulatory
uncertainties surrounding the product.
Other revenue increased from $299,000 for the first quarter of 1995 to
$454,000 for the first quarter of 1996, as a result of: (i) higher gross
profit generated by the sale of purchased and trade inventory at the GAC sales
lots, (ii) a $125,000 reduction in the special reserve for losses on
receivables from a dealer due to a reduction in the amounts owed by that
dealer, partially offset by (iii) lower training fees earned by the Company in
the first quarter of 1996 as compared to the first quarter of 1995. Effective
January 1, 1996, the training fee previously charged to dealers by the Company
was replaced with a $35 per contract training and processing fee, which is
deferred and amortized into income over the estimated average life of the
contracts. The previous training fee, charged for new dealers in a $2,500
lump sum or $100 per contract for the first 35 contracts, was recognized as
income upon receipt.
Expenses
Interest expense increased from $1.4 million in the first quarter of 1995
to $2.1 million for the first quarter of 1996, an increase of $789,000, or
58.1%. This increase was due to a higher average level of borrowings under
the Company's revolving line of credit to fund the higher volume of contracts
purchased in the first quarter of 1996, offset in part by a lower interest
rate environment in the first quarter of 1996. Average borrowings on the line
of credit were $53.4 million during the first quarter of 1995 compared to
$96.9 million during the first quarter of 1996. In addition, effective March
15, 1996, the interest rate on the line was increased from LIBOR plus 3.0% to
LIBOR plus 4.0%. The 1.0% increase was provided for in a letter agreement
(the "Forbearance Agreement") signed between the Company and its primary
lender on March 20, 1996. This increased interest rate will continue until
June 30, 1996, at which time the Company expects to sign a new agreement with
its primary lender. See "Liquidity and Capital Resources" for additional
information.
Salaries and employee benefits increased from $914,000 for the first
quarter of 1995 to $2.3 million for the first quarter of 1996, or 149.6%. The
increase was due to an increase in full time equivalent employees from 163 as
of March 31, 1995 to 329 as of March 31, 1996. The increase in employees was
primarily attributable to the development and staffing of the Company's branch
offices and GAC sales lots, and to a lesser extent, to additional management
personnel hired by the Company during the first quarter of 1996, to further
develop the Company's infrastructure required to support anticipated portfolio
growth during the second half of 1996 and thereafter.
Marketing costs increased from $111,000 in the first quarter of 1995 to
$177,000 in the first quarter of 1996, an increase of $66,000, or 59.3%. The
increase was due to increased advertising for the GAC sales lots in the first
quarter of 1996 compared to the first quarter of 1995.
The provision for credit losses increased from $398,000 for the first
quarter of 1995 to $1.2 million for the first quarter of 1996, an increase of
$836,000. In the first quarter of 1995, the provision for credit losses
consisted entirely of amounts provided for contracts originated by the GAC
sales lots. As there is no discount associated with these contracts, in order
to develop a reserve for future credit losses, a charge directly to earnings
was required. In the first quarter of 1996, however, an additional provision
was required to restore the allowance and discount available for credit losses
on contracts acquired from dealers to a level deemed acceptable by the
Company. Substantially all of the $836,000 increase in the provision for
credit losses in the first quarter of 1996 was due to this additional
provision. As of March 31, 1996, total available for credit losses as a
percent of contracts receivable was 14.29% compared to 14.13% as of March 31,
1995.
Other expenses increased from $754,000 for the first quarter of 1995 to
$1.2 million for the first quarter of 1996, an increase of $481,000, or 63.8%.
The increase was due to: (i) higher costs associated with a larger network of
branch offices and GAC sales lots, including higher rent and depreciation
expense, and (ii) higher computer system expense in the first quarter of 1996
due to the Norwest system implementation late in the first quarter of 1995.
As a result of the foregoing factors, pre-tax net income declined from
$1.5 million for the first quarter of 1995 to $372,000 for the first quarter
of 1996.
Income tax expense was nil for the first quarter of 1995, because, since
its inception, the Company had been an S Corporation. In conjunction with the
initial public offering of its shares, the Company terminated its S
Corporation status, and as a result, became subject to federal and state
corporate income taxation from April 10, 1995 forward. For the first quarter
of 1996, income tax expense was $149,000, representing a combined federal and
state income tax rate of 40%.
LIQUIDITY AND CAPITAL RESOURCES
The Company's principal need for cash is to fund advances made to dealers
in connection with the acquisition of contracts. Cash used for this purpose
was $18.3 million in the first quarter of 1995 and $18.1 million in the
first quarter of 1996. The Company funded its contract purchases with
borrowings on its $100.0 million revolving line of credit with GE Capital (the
"Line"). The Line provides for interest at the one-month LIBOR rate plus 3.0%
(4.0% for the period from March 15, 1996 to June 30, 1996). As of March 31,
1996, borrowings on the Line were $97.2 million.
During the fourth quarter of 1995, the Company experienced sharply
increased loan losses and delinquency rates. On January 17, 1996, GE Capital
notified the Company of an event of default under its loan and security
agreement ("Agreement"). GE Capital continued to fund the Company under the
Line while the Company and GE Capital negotiated a mutually acceptable plan of
action. On March 20, 1996, GE Capital and the Company signed the Forbearance
Agreement under which, assuming no further events of default, GE Capital
agreed to forbear from exercising its rights under the Agreement through June
30, 1996, subject to the Company meeting certain terms and conditions. Since
signing of the Forbearance Agreement, the Company has complied with all its
terms and conditions, except that during the first quarter of 1996, net
charge-offs exceeded maximum permitted levels under the Forbearance Agreement.
The higher than permitted net charge-offs were due to the Company's
aggressive collection efforts during the first quarter of 1996 which were
successful in producing substantial declines in delinquency rates, but also
resulted in higher than anticipated net charge-offs. GE Capital has provided
the Company with a letter which amends the maximum charge-off levels in the
Forbearance Agreement, and with which the Company is in full compliance. The
Forbearance Agreement provides that on or before July 1, 1996, the Company and
GE Capital will negotiate in good faith to sign a new mutually acceptable loan
agreement which will supersede the terms of the Agreement and the amended
Forbearance Agreement in their entirety. If the Company and GE Capital are
unable to agree on mutually acceptable terms by July 1, 1996, the parties have
agreed that the Forbearance Agreement will remain in effect until December 31,
1996, except that the imposition of the extra 1% interest rate will cease June
30, 1996.
GE Capital has indicated that it will not consider increasing the current
$100.0 million Line prior to the expiration of the forbearance period on June
30, 1996, nor has it committed to waiving the default at that time. The
Company has begun exploring alternatives to increase and diversify its funding
sources but believes it will have difficulty in securing alternative funding
sources while it remains in default under the Line.
Based on the aforementioned funding limitations, the Company expects that
its contracts receivable will remain near current levels during the first half
of 1996. If the Company and GE Capital do not agree on a mutually acceptable
loan agreement to supersede the Agreement and the Forbearance Agreement, there
is no assurance that the Company will be successful in locating additional
financing. If additional financing is not available during the second half of
1996 from GE Capital or other sources, the Company's growth will be curtailed.
In April, 1996, the Company completed its move to new headquarters
offices. During the first quarter of 1996, the Company spent $352,000 of its
planned $500,000 in capital expenditures for furniture and computer and
telephone equipment. The remaining $148,000 in capital expenditures related
to the move is expected to be incurred in the second quarter of 1996.
As a result of the Company's collection efforts during the first quarter,
repossession inventory grew from $5.2 million as of December 31, 1995 to $9.7
million as of March 31, 1996, an increase of $4.5 million. Repossession
inventory is expected to decline moderately during the second quarter of 1996
and more rapidly during the second half of 1996. The Company is currently
exploring opportunities to finance a portion of its vehicle inventory in an
effort to reduce the level of internal funding necessary to support this
inventory.
<PAGE>
PART II
ITEM 1. LEGAL PROCEEDINGS
The Company is not involved in any litigation that is expected to have a
material adverse effect on the Company. The Company regularly initiates legal
proceedings as a plaintiff in connection with its routine collection
activities.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
The Company did not file any reports on Form 8-K during the quarter ended
March 31, 1996.
<PAGE>
SIGNATURES
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<CAPTION>
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 thereunto duly authorized.
<S> <C> <C>
GENERAL ACCEPTANCE CORPORATION
Date May 14, 1996 /s/ Russell E. Algood
------------ ------------------------------
Russell. E. Algood
President and
Chief Operating Officer
Date May 14, 1996 /s/ Martin C. Bozarth
------------ ------------------------------
Martin C. Bozarth
Chief Financial Officer
</TABLE>
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<TABLE>
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EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- ------- -------------------------------------------------------------------
3.1 Amended and Restated Articles of Incorporation of
General Acceptance Corporation (incorporated by reference to
Exhibit 3.1 in the Company's Form S-1 Registration Statement,
File No. 33-89520)
3.2 Bylaws of General Acceptance Corporation (incorporated by
reference to Exhibit 3.2 in the Company's Form S-1
Registration Statement, File No. 33-89520)
4.1 See exhibits 3.1 and 3.2
4.2 Specimen Stock Certificate for Common Stock (incorporated by
reference to Exhibit 4.2 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.1 Loan and Security Agreement, dated May 1, 1992, between
General Electric Capital and GAC Credit Corporation
(incorporated by reference to Exhibit 10.1 in the Company's
Form S-1 Registration Statement, File No. 33-89520)
10.2 Amendment No. 1 to Loan and Security Agreement, dated May 25,
1993 between General Electric Capital Corporation and General
Acceptance Corporation (incorporated by reference to Exhibit
10.2 in the Company's Form S-1 Registration Statement, File
No. 33-89520)
10.3 Amendment No. 2 to Loan and Security Agreement, dated July 12,
1993 between General Electric Capital Corporation and General
Acceptance Corporation (incorporated by reference to Exhibit
10.3 0.in the Company's Form S-1 Registration Statement, File
No. 33-89520)
10.4 Amendment No. 3 to Loan and Security Agreement, dated October
4, 1993 between General Electric Capital Corporation and
General Acceptance Corporation (incorporated by reference to
Exhibit 10.4 in the Company's Form S-1 Registration
Statement, File No. 33-89520)
10.5 Amendment No. 4 to Loan and Security Agreement, dated
December 20, 1993 between General Electric Capital
Corporation and General Acceptance Corporation (incorporated
by reference to Exhibit 10.5 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.6 Amendment No. 5 to Loan and Security Agreement, dated May 2,
1994 between General Electric Capital Corporation and General
Acceptance Corporation (incorporated by reference to Exhibit
10.6 in the Company's Form S-1 Registration Statement, File
No. 33-89520)
10.7 Amendment No. 6 to Loan and Security Agreement, dated May 12,
1994 between General Electric Capital Corporation and General
Acceptance Corporation (incorporated by reference to Exhibit
10.7 in the Company's Form S-1 Registration Statement, File
No. 33-89520)
10.8 Letter Agreement, dated August 18, 1994, between General
Electric Capital Corporation and General Acceptance
Corporation (incorporated by reference to Exhibit 10.8
in the Company's Form S-1 Registration Statement, File No.
33-89520)
10.9 Letter Agreement, dated September 15, 1994, between General
Electric Capital Corporation and General Acceptance
Corporation (incorporated by reference to Exhibit 10.9 in the
Company's Form S-1 Registration Statement, File No. 33-
89520)
10.10 Assignment Agreement, dated as of November 18, 1994, between
Kidder, Peabody Global Capital Corporation, Credit Lyonnais
New York Branch and General Acceptance Corporation,
assigning interest rate cap annexed thereto (incorporated by
reference to Exhibit 10.10 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.11 Confirmation of Assignment of interest rate cap from Kidder,
Peabody Global Capital Corporation to Chemical Bank,
assigning interest rate cap annexed thereto (incorporated by
reference to Exhibit 10.11 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.12 Confirmation of Assignment of interest rate cap from Kidder,
Peabody Global Capital Corporation to Chemical Bank,
assigning interest rate cap annexed thereto (incorporated by
reference to Exhibit 10.12 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.13 Guaranteed Auto Protection Program Administrative Services
Agreement between Western Diversified Services, Inc. and
General Acceptance Corporation (incorporated by reference to
Exhibit 10.13 in the Company's Form S-1 Registration
Statement, File No. 33-89520)
10.14 Credit Insurance Agency Agreement, dated August 1, 1988,
between Concord National Life Insurance Company and GAC
Credit Corporation (now General Acceptance Corporation)
(incorporated by reference to Exhibit 10.14 in the Company's
Form S-1 Registration Statement, File No. 33-89520)
10.15 Credit Insurance Agreement, dated November 29, 1994 between
Union Fidelity Life Insurance Company and General
Acceptance Corporation (incorporated by reference to Exhibit
10.15 0.in the Company's Form S-1 Registration Statement, File
No. 33-89520)
10.16 Promissory Note, dated November 18, 1993, in the original
principal amount of $399,000 payable to General Acceptance
Corporation by All-Good Cars Incorporated (incorporated by
reference to Exhibit 10.16 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.17 Form of Promissory Note payable by General Acceptance
Corporation to existing shareholders, officers and related parties
of General Acceptance Corporation as set forth on the schedule
to this Exhibit (incorporated by reference to Exhibit 10.17 in
the Company's Form S-1 Registration Statement, File No. 33-89520)
10.18 Commercial Lease Agreement, dated December 10, 1993, between
Edwards Properties and General Acceptance Corporation, and
extension dated January 20, 1995 (incorporated by reference to
Exhibit 10.18 in the Company's Form S-1 Registration
Statement, File No. 33-89520)
10.19 Lease Agreement, dated December 13, 1994, between Pat
D'Andrea d/b/a Plaza 43 and General Acceptance Corporation
(incorporated by reference to Exhibit 10.19 in the Company's
Form S-1 Registration Statement, File No. 33-89520)
10.20 Business Lease, dated December 9, 1993, between Crusader
Buildings, Cindy Jarvis and General Acceptance Corporation
(incorporated by reference to Exhibit 10.20 in the Company's
Form S-1 Registration Statement, File No. 33-89520)
10.21 Lease, dated May 16, 1994, between M. L. Algood, Janet B.
Algood and Russell E. Algood and General Acceptance
Corporation (incorporated by reference to Exhibit 10.21 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.22 Store Lease, dated March 28, 1994, between General Acceptance
Corporation and Schrank & Associates as agent for G&B
Investors and Rider with respect thereto, dated March 28,
1994 (incorporated by reference to Exhibit 10.22 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.23 Lease, dated October 31, 1994, between M. L. Algood, Janet B.
Algood and General Acceptance Corporation (incorporated by
reference to Exhibit 10.23 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.24 Commercial Lease, dated January 1, 1995, between Kenneth Bader
and General Acceptance Corporation (incorporated by
reference to Exhibit 10.24 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.25 Lease Agreement, dated January 21, 1995, between Enrovi
Associates and General Acceptance Corporation (incorporated
by reference to Exhibit 10.25 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.26 Real Estate Lease, dated January 31, 1995, between James R.
Sandefur and Bobbie Sandefur and General Acceptance
Corporation (incorporated by reference to Exhibit 10.26 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.27 Forms of Dealer Retail Agreement and Amendment to Dealer
Retail Agreement (incorporated by reference to Exhibit 10.27 in
the Company's Form S-1 Registration Statement, File No. 33-89520)
10.28 Dealer Retail Agreement, dated January 2, 1994, between Bedford
Chrysler Plymouth Dodge, Inc. and General Acceptance
Corporation (incorporated by reference to Exhibit 10.28 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.29 Dealer Retail Agreement, dated January 4, 1994, between
Ellettsville Truck & Car, Inc. and General Acceptance
Corporation (incorporated by reference to Exhibit 10.29 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.30 Dealer Retail Agreement, dated January 17, 1994, between All-
Good Cars, Inc. and General Acceptance Corporation
(incorporated by reference to Exhibit 10.30 in the Company's
Form S-1 Registration Statement, File No. 33-89520)
10.31 Dealer Agreement, dated January 2, 1994, between Algood
Chevrolet, Oldsmobile, Pontiac, Inc. and General Acceptance
Corporation (incorporated by reference to Exhibit 10.31 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.32 Dealer Agreement, dated July 11, 1988, between Algood Motor
Company, Inc. and General Acceptance Corporation
(incorporated by reference to Exhibit 10.32 in the Company's
Form S-1 Registration Statement, File No. 33-89520)
10.33 General Acceptance Corporation Compensation Plan
(incorporated by reference to Exhibit 10.33 in the Company's
Form S-1 Registration Statement, File No. 33-89520)
10.34 General Acceptance Corporation Employee Stock Option Plan
(incorporated by reference to Exhibit 10.34 in the Company's
Form S-1 Registration Statement, File No. 33-89520)
<PAGE>
10.35 General Acceptance Corporation Outside Director Stock Option
Plan (incorporated by reference to Exhibit 10.35 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.36 Form of Tax Indemnification Agreement, dated as of ____, 1995,
by among General Acceptance Corporation and Malvin L.
Algood, Russell E. Algood, Shirley A. Cook and John G.
Algood (incorporated by reference to Exhibit 10.36 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.37 System Purchase Agreement, Software License Agreement, each
dated September 7, 1993, between Advanced Lease Systems,
Inc. and General Acceptance Corporation (incorporated by
reference to Exhibit 10.37 in the Company's Form S-1
Registration Statement, File No. 33-89520)
10.38 Agreement, dated September 6, 1994, between Norwest Financial
Information Services Group, Inc. and General Acceptance
Corporation (incorporated by reference to Exhibit 10.38 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.39 Form of Term Loan Agreement between NBD Bank, N. A. and
General Acceptance Corporation, with respect to S Corporation
Distributions (incorporated by reference to Exhibit 10.39 in the
Company's Form S-1 Registration Statement, File No. 33-89520)
10.40 Letter confirmation of warranty program between Wynn's and
General Acceptance Corporation (incorporated by reference to
Exhibit 10.40 in the Company's Form S-1 Registration
Statement, File No. 33-89520)
10.41 First Amendment to Credit Insurance Agreement, dated March 8,
1995, between Union Fidelity Insurance Company and General
Acceptance Corporation (incorporated by reference to Exhibit
10.41 0.in the Company's Form S-1 Registration Statement, File
No. 33-89520)
10.42 Installment Business Loan Note, dated February 13, 1995, payable
by General Acceptance Corporation to NBD Bank, N. A.
(incorporated by reference to Exhibit 10.42 in the Company's
Form S-1 Registration Statement, File No. 33-89520)
10.43 Sublease, dated April 27, 1995, between Hunt, Inc., James J.
Castoro, Winifred Castoro and General Acceptance
Corporation (incorporated by reference to Exhibit 10.43 in the
Company's Form 10-K for the year ended December 31, 1995)
10.44 Lease, dated May 24, 1995, between The Koger Partnership, Ltd.
and General Acceptance Corporation (incorporated by reference
to Exhibit 10.44 in the Company's Form 10-K for the year
ended December 31, 1995)
10.45 Office Lease, dated June 6, 1995, between Kenneth Bader and
General Acceptance Corporation (incorporated by reference to
Exhibit 10.45 in the Company's Form 10-K for the year ended
December 31, 1995)
10.46 Letter Agreement, dated July 18, 1995, between General Electric
Capital Corporation and General Acceptance Corporation
(incorporated by reference to Exhibit 10.46 in the Company's
Form 10-K for the year ended December 31, 1995)
10.47 Office Lease, dated August 7, 1995, between 2930 LLC and
General Acceptance Corporation (incorporated by reference to
Exhibit 10.47 in the Company's Form 10-K for the year ended
December 31, 1995)
10.48 Store Lease, dated August 7, 1995, between Julius Teitle, Michael
Teitle and General Acceptance Corporation (incorporated by
reference to Exhibit 10.48 in the Company's Form 10-K for the
year ended December 31, 1995)
10.49 Lease, dated August 9, 1995, between Russell E. Algood and
General Acceptance Corporation(incorporated by reference to
Exhibit 10.49 in the Company's Form 10-K for the year ended
December 31, 1995)
10.50 Marketing Agreement, dated September 12, 1995, between Key
Federal Savings Bank and General Acceptance Corporation
(incorporated by reference to Exhibit 10.50 in the Company's
Form 10-K for the year ended December 31, 1995)
10.51 Commercial Lease, dated September 25, 1995, between Edwards
Properties and General Acceptance Corporation (incorporated
by reference to Exhibit 10.51 in the Company's Form 10-K for
the year ended December 31, 1995)
10.52 Office Lease, dated October 2, 1995, between C. R. Kreis, Virginia
Kreis and General Acceptance Corporation (incorporated by
reference to Exhibit 10.52 in the Company's Form 10-K for the
year ended December 31, 1995)
10.53 Commercial and Industrial Lease Agreement, dated October 30,
1995, between The Ruby C. Kenworthy Trust and General
Acceptance Corporation (incorporated by reference to Exhibit
10.53 0.in the Company's Form 10-K for the year ended
December 31, 1995)
10.54 Collateral Physical Damage Insurance Policy, dated November 1,
1995, between Ohio Indemnity Company and General
Acceptance Corporation (incorporated by reference to Exhibit
10.54 0.in the Company's Form 10-K for the year ended
December 31, 1995)
10.55 Commercial Lease, dated November 16, 1995, between Michael
Lee and General Acceptance Corporation (incorporated by
reference to Exhibit 10.55 in the Company's Form 10-K for the
year ended December 31, 1995)
10.56 Addendum to Lease Agreement, dated January 12, 1996, between
Enrovi Associates and General Acceptance Corporation
(incorporated by reference to Exhibit 10.56 in the Company's
Form 10-K for the year ended December 31, 1995)
10.57 Lease, dated January 12, 1996, between The Ohio State Highway
Patrol Retirement System and General Acceptance Corporation
(incorporated by reference to Exhibit 10.57 in the Company's
Form 10-K for the year ended December 31, 1995)
10.58 Letter, dated January 17, 1996, from General Electric Capital
Corporation to General Acceptance Corporation (incorporated
by reference to Exhibit 10.58 in the Company's Form 10-K for
the year ended December 31, 1995)
10.59 Lease Agreement, dated January 31, 1996, between Terry Johnson,
Jean Johnson and General Acceptance Corporation
(incorporated by reference to Exhibit 10.59 in the Company's
Form 10-K for the year ended December 31, 1995)
10.60 Real Estate Lease, dated March 1, 1996, between James R.
Sandefur, Bobbie Sandefur and General Acceptance
Corporation (incorporated by reference to Exhibit 10.60 in the
Company's Form 10-K for the year ended December 31, 1995)
10.61 Letter Agreement, dated March 20, 1996, between General Electric
Capital Corporation and General Acceptance Corporation
(incorporated by reference to Exhibit 10.61 in the Company's
Form 10-K for the year ended December 31, 1995)
10.62 First Sublease Extension Agreement, dated April 12, 1996,
between James J. Castoro, Winifred Castoro, Hunt, Inc. and
General Acceptance Corporation
10.63 Office Lease Agreement, dated April 19, 1996, between Cole
Taylor Bank, Trust No. 4399 and General Acceptance
Corporation
10.64 Letter Agreement, dated May 10, 1996, between General Electric
Capital Corporation and General Acceptance Corporation
11.1 Statement Re: Computation of Per Share Earnings
27.1 Financial Data Schedule
</TABLE>
<PAGE>
Exhibit 10.62
FIRST SUBLEASE EXTENSION AGREEMENT
THIS FIRST SUBLEASE EXTENSION AGREEMENT (the "Agreement"), made and
entered into the 12th day of April 1996, by, between and among JAMES J.
CASTORO and WINIFRED CASTORO, his wife (the "Landlord"), HUNT, INC., a Florida
corporation, (the "Tenant"), and GENERAL ACCEPTANCE CORPORATION, and Indiana
corporation (the "Subtenant") and collectively referred to as the parties.
W I T N E S S E T H :
WHEREAS, Landlord and Tenant entered into that certain lease on April 5,
1994, a copy of which is attached as Exhibit "A" (the "Lease"), for the real
property located at 7669 15th Street East, Sarasota, Manatee County, Florida
34243 (the "Demised Premises"); and
WHEREAS, Tenant and Subtenant, with the consent of Landlord, entered into
a sublease for the Demised Premises on April 27, 1995, a copy of which is
attached as Exhibit "B" (the "Sublease"); and
WHEREAS, the parties were sometimes described in the Sublease as follows:
Tenant, Hunt, Inc., was sometimes described as "Landlord;" Subtenant, General
Acceptance Corporation was sometimes described as "Tenant;" and Landlord,
James J. Castoro and Winifred Castoro, were sometimes described as "Owner" in
the Sublease; and
WHEREAS, Subtenant has elected to extend the term of the Sublease, as
provided in Paragraph 2 thereof; and
WHEREAS, Subtenant is current in all rent payments due Landlord under
Paragraph 3 of the Sublease; and
WHEREAS, the parties acknowledge that their negotiations have culminated
in an agreement concerning the further extension of the Sublease on the terms
outlined below.
NOW, THEREFORE, in consideration of the premises, Landlord and Tenant
covenant and agree as follows:
1. RECITALS. The recitals contained herein above are true and correct
and incorporated herein by reference. Capitalized terms shall have the same
meaning as those in the Lease and Sublease, unless otherwise expressly
defined.
2. TERM. The term of this Sublease shall commence May 15, 1996, and
end on May 14, 1997, unless otherwise terminated or extended, as hereinafter
provided and as set forth in the Sublease and Lease. Anything to the contrary
notwithstanding, Tenant's obligations and liabilities hereunder and under the
terms of the Lease and Sublease terminate on April 30, 1997, the date of the
termination of the Original Term.
3. ADDITIONAL LEASE EXTENSIONS. Additional Lease extensions shall be
provided to Subtenant as set forth in Paragraph 2C of the Sublease. Rent for
these extended terms shall be as set forth in Paragraph 3 of the Lease and
Paragraph 3 of the Sublease.
4. CONFIRMATION OF LEASE AND SUBLEASE. In all other respects, the
Lease dated April 5, 1994, and Sublease, dated April 27, 1995, are ratified
and confirmed. All provisions set forth in that Lease and Sublease, as
applicable, shall apply to this First Sublease Extension Agreement. In the
event of a conflict between the terms of this First Sublease Extension
Agreement and the terms of the Lease or Sublease, the terms of this First
Sublease Extension Agreement shall prevail.
5. EFFECTIVE DATE. The effective date of this First Sublease
Extension shall be May 1, 1996, notwithstanding the date indicated at the
beginning of this Agreement.
6. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, the signature pages of which may be combined to create a singel
document.
IN WITNESS WHEREOF, the parties have executed or caused to be executed
this First Sublease Extension Agreement as of the day and year first above
written.
Signed, sealed and delivered
in the presence of:
<TABLE>
<CAPTION>
<S> <C>
/s/ Jessica Baumann /s/ James J. Castoro
- ---------------------- -------------------------------
Witness James J. Castora
Jessica Baumann
- ----------------------
Print Name of Witness
/s/ Inger Kirkwood /s/ Winifred Castoro
- ---------------------- -------------------------------
Witness Winifred Castoro
Inger Kirkwood
- ----------------------
Print Name of Witness
HUNT, INC., a Florida
corporation,
/s/ R. Shane By: /s/ Irene Ragger
- ----------------------
Witness
R. Shane Irene Ragger
- ----------------------
Print Name of Witness Print Name
/s/ B. Mattison Controller
- ---------------------- -------------------------------
Witness Title
B. Mattison
Print Name of Witness
GENERAL ACCEPTANCE CORPORATION,
an Indiana corporation
/s/ Mark Stewart By: /s/ B. Wayne Garland
- ---------------------- -------------------------------
Witness
Mark Stewart Wayne Garland
- ---------------------- -------------------------------
Print Name of Witness Print Name
/s/ Douglas Edwards VP
- ---------------------- -------------------------------
Witness Title
Douglas F. Edwards
- ----------------------
Print Name of Witness
</TABLE>
<PAGE>
Exhibit 10.63
OFFICE LEASE AGREEMENT
THIS LEASE made this 19th day of APRIL 1996 between Cole Taylor Danr,
Trust #4399 dated June 11,1985, William II. McNaughton as Beneficiary of the
Trust DBA Woodland Park Properties ("Landlord"), and General Acceptance
Corporation ("Tenant").
As parties hereto, Landlord and Tenant agree:
1. LEASE DATA AND EXHIBITS:
The following terms as used herein shall have the meanings provided in this
Section 1, unless otherwise specifically modified by provisions of this Lease:
(a) Building Complex: ("Complex") Known as the group of buildings
comprising WOODLAND OFFICE PARK, situated on the real property more
particularly described in EXHIBIT A and attached hereto.
(b) Premises: ("Premises") Consisting of the floor area as outlined, on
tile floor plan of the Building known as
277 D , Burr Ridge, 11. 60521 AND shown on the attached
Exhibit B.
Total SQUARE FOOTAGE: 2,628.
(c) Tenant's Percentage of the Complex: As used in this Lease,
Landlord and Tenant agree that Tenant's percentage of the Complex is
11.95and may be revised pursuant to subsection 8(b)(vii).
(d) Final Plan Delivery Date: NOT APPLICABLE
(e) Lease Commencement Date: SEE RIDER 1 or such earlier or later date as
provided in Section 3 hereof ("Commencement Date").
(f) Expiration Date: SEE RIDER l
(g) Rent: See Rider #1
(h) Security Deposit: $ 3204.00 PIUS JUNE RENT OF $3204.00
(i) Notices Addresses:
Landlord: COLE TAYLOR DANR , TRUST #4399
DATED JUNE 11,1985, WlLLlAM II. MCNAUGHTON
AS BENEFICIARY, DBA WOODLAND PARK
PROPERTIES at 347 W. 83rd St. Ste A, Burr
Ridge, 11. 60521
Tenant: Mary Wheeler King
Assistant Vice President
323 10th Avenue W., Suite 102
Palmetto, Florida 34221
(j) Payments Address: 347 W. 83rd STREET, SUITE A BURR RIDGE, lLLlNOIS 60521
(k) Exhibits: The following exhibits or riders are made a part of this Lease:
Exhibit A. Legal Description of Office Building Complex
Exhibit B. Tenant's floor space in relation to Tenant's Building
Exhibit C. Description of Landlord's Work Responsibility &
Description of Tenant's Work Responsibility)
Exhibit D. Tenant's space Plan
EXHIBIT E. BUILDING RULES
Rider #1 Rent, Term and Commencement
Rider #2 Options(s) T o Renew Lease Term
Rider #3 Guaranty
2. PREMISES: Landlord does hereby Lease to Tenant, and Tenant does hereby
Lease from, Landlord, upon the terms and conditions herein set forth, the
Premises described in Section l(b) hereof as shown on Exhibit D attached
hereto and incorporated herein, located on the Land in Burr Ridge, Illinois
("Land") more particularly described in Exhibit A and Exhibit B attached
hereto and made a part hereof.
3. COMMENCEMENTAND EXPIRATION DATES:
(a) Lease Commencement Date. The Lease Commencement Date
shall be:
(i) The date specified in Section l(e) unless notice is/
delivered pursuant to subsection 3(a)(ii) or unless
Tenant occupies earlier, pursuant to subsection /
3(a)(iii):
(ii) Such earlier or later date as may be specified in a
notice delivered to Tenant at least 30 days before
such date upon which the Premises, together with
the common facilities for access and service
thereto, have been completed; or
(iii) If Tenant shall occupy the Premises for Permitted Uses prior to the
date specified in subsection l(e) or in the notice provided under subsection 3
( a ) ( i i ), the date of such early occupancy.
(b) Tenant Obligations. If Tenant's improvements are not
completed on the Lease Commencement Date as specified in
Section l(e) or as provided in subsection 3(a)(ii)
above, whichever is applicable, due to the failure of
Tenant to fulfill any obligation pursuant to the terms
of this Lease or any exhibit thereto, including without
limitation Tenant's failure to comply with the Final
Plan Delivery Date described in Exhibit D if contained
in Work Letter and the Final Plans Delivery Date
described in subsection (d) the Lease shall be deemed
to have commenced upon the Lease Commencement Date
specified in Section 1(e) or in the notice provided in
subsection 3(a)(i) above, as applicable.
<PAGE>
c) Tenant Termination Rights. In the event a Lease Commencement Date as
provided in subsection 3(a)(ii) above does not occur within six months
following the Lease Commencement Date specified in Section 1(e), Tenant may
terminate this Lease by written notice; provided, however that such six-month
period may at Landlord's sole option be extended by any period, not to exceed
two years from the Lease Commencement Date specified in Section on 1(e), for
delays due to casualties, acts of God, strikes, shortages of labor or
materials or other causes beyond the reasonable control of Landlord. If the
Lease Commencement Date has not occurred within such two-year period, this
Lease shall be deemed null and void and all rights and obligations of the
parties shall terminate. Termination under this subsection (c) shall be
Tenant's sole remedy and Tenant shall have no other rights or claims
hereunder at Law or in equity.
(d) Confirmation of Commencement Date. When a Lease Commencement Date as
provided in subsections 3(a)(ii) and (iii) above has been established as a
later or earlier date than the Lease Commencement Date provided in Section 1(e)
hereof, Landlord shall confirm the same to Tenant in writing.
(e) Expiration Date. The Lease shall expire on the date specified in section 1
(f).
4. RENT: Tenant shall pay Landlord the monthly rental stated in Rider #1
hereof ("Rent") and Additional Rent as provided in Section 8 and any other
additional payments due under this Lease without Deduction or offset and
without further notice, payable in lawful money of the United States, in
advance on or before the first day of each month at the address noted in
Section 1(b) hereof, or to such other party or at such other place as Landlord
may hereafter from time to time designate in writing. Rent and Additional Rent
for any partial month at the beginning or end of the Lease term shall be
prorated and shall be due without notice, deduction or offset.
5. SECURITY DEPOSIT: Concurrently with the execution of this Lease, Tenant
shall deliver to Landlord the security deposit indicated in Section l(h) as
security for the performance by Tenant of every covenant and condition of this
Lease. This deposit shall not bear interest or earn income and shall not be
considered an advance payment of rental or a measure of Landlord's damages in
case of default by Tenant. The security deposit shall not be considered a
trust fund. Landlord does not represent that Landlord is acting as a trustee
or in any fiduciary capacity in controlling or using Tenant's security deposit
as provided herein.
<PAGE>
If Tenant shall default with respect to any covenant or condition of this
Lease Landlord may apply the whole or part of such security deposit to the
payment of any sum in default or any other sum which Landlord may be required
to spend by reason of Tenant's default. Following such application of the
security deposit, Tenant shall immediately upon demand pay to Landlord the
amount necessary to restore the security deposit to its original amount. If
Tenant complies with all of the covenants and conditions of this Lease, the
security deposit or any balance thereof shall be returned to the tenant within
twenty (20) days after both the expiration or other termination of this Lease
and after delivery of possession of the Premises to Landlord. If the Landlord
assigns or transfers its interest in this Lease, the Premises or the Building
during the Lease term, Landlord may assign the security deposit to the
assignee or transferee and thereafter Landlord shall have no further liability
for the return of such security deposit and Tenant agrees to look solely to
the assignee for the return of any part of such security deposit to which
Tenant may be entitled. This provision shall apply to every transfer or
assignment of the security deposit. Tenant agrees that it will not assign or
encumber or attempt to assign or encumber the monies deposited as security and
that Landlord and it's successors and assigns shall not be bound by any such
actual or attempted assignment or encumbrance.
6. USES: The Premises are to be used only for general office purposes
("Permitted Uses"), and for no other business or purpose without the prior
written consent of Landlord. No act shall be done in or about the Premises
that is unlawful or that will increase the existing rate of insurance on the
Complex. Tenant shall not commit or allow to be committed any waste upon the
Premises, or any public or private nuisance or other act or thing which
disturbs the quiet enjoyment of any other tenant in the Complex. Tenant shall
not, without the prior written consent of Landlord, use any apparatus,
machinery or device in or about the Premises which will cause any substantial
noise or vibration or fumes. If any of Tenant's office machines and equipment
should disturb the quiet enjoyment of any other Tenant in the Complex, then
Tenant shall provide adequate insulation, or take such other action as may be
necessary to eliminate the disturbance. Tenant shall comply with all laws
relating to its use or occupancy of the Premises and shall observe such
reasonable rules and regulations as may be adopted and made available to
Tenant by Landlord from time to time for the safety, care and cleanliness of
the Premises or the Complex, and for the preservation of good order therein.
7. SERVICES AND UTILITIES: Landlord shall MAINTAIN OR CAUSE TO be maintained
the public and common areas OF THE COMPLEX SUCH AS PARKING LOT, IN good order
and condition consistent with a first class Burr Ridge office building complex
except for damage occasioned by any act or omission of Tenant, the repair of
which damage shall be paid for by Tenant. Landlord shall not be liable for any
loss injury or damage to property caused by or resulting from any variation
interruption, or failure to make any repairs or perform any maintenance. No
temporary interruption or failure for such services incident to the making of
repairs alterations or improvements or due to accident strike or conditions
or events beyond Landlord's reasonable control shall be deemed an eviction
of Tenant or relieve Tenant from any of tenant's obligations hereunder.
<PAGE>
Before installing any equipment and lights which generate an undue amount
of heat in the Premises (equipment and lights which generate in excess of 2.5
watts per square foot), or before Tenant uses or wishes to use any high power
usage equipment in the Premises (equipment with power requirements equal to or
in excess OF 220 VOLT SINGLE phase 30 amperes), Tenant shall obtain the prior
written permission of Landlord. Landlord may refuse to grant such permission
unless Tenant shall agree to pay the costs of Landlord for installation of
supplementary air conditioning capacity or electrical systems as necessitated
by such equipment.
The Rent stated in Rider #1 hereof does not include any amount to cover
the cost of furnishing electricity or gas other than amounts of electricity
and/or gas utilized in SERVICING THE common areas of the Complex. All other
charges for electricity and gas shall be billed directly to the Tenant by the
particular utility providing the service and it shall be Tenant's sole
obligation to pay for the same.
In the event of non-payment of additional payments due from Tenant for
any of the additional services over and above those typically provided by
Landlord Landlord shall have the same rights with respect to such non-payment
as it has with respect to the non-payment of rent hereunder.
8. ADJUSTMENT OF RENT:
(a) Additional Rent. The rent described in Rider #1 hereof, shall be increased
or decreased (to the extent provided herein) for each Comparison Year by
Tenant's Proportionate Share of any increase or decrease for such Comparison
Year in the amounts of Real Estate Taxes and Operating Expenses over or below
the amounts thereof for the base year, however no adjustment shall be made to
the rent if the Operating Expenses and Real Estate Taxes are less than the
base amount.
(b) Definitions. For tile purposes of this Article the following definitions
shall be applicable: (i) The term "Base Year" for Operating Expenses means
the calendar year of 1yI5 "Base Year" for Real Estate Taxes means the
calendar year of ________.
(ii) The term "Base Amount" means the total of $ ~ 0 per square foot per year.
(iii) The term "Comparison Year" means each calendar year during the Term
subsequent to the Base Year:
(iv) The term "Real Estate Taxes" means all taxes and assessments special or
otherwise levied upon or with respect to the Complex and the land and the
various estates therein and herein or either of them imposed by Federal,
State or Local governments, use or occupancy or similar taxes license fees
excise and taxes on or based upon rent and other income from the Complex
(computed in case of a graduated tax as if Landlord's income from the Complex
were the Landlord's sole taxable income) or any other tax, fee or excise,
however described of every kind and nature whatsoever levied and assessed and
imposed on Landlord in lieu of or in substitution in whole or in part for or
in addition to existing or additional real or personal property taxes or
assessments on the Land Buildings or said personal property.
<PAGE>
In addition, the term "REAL ESTATE TAXES" INCLUDES THE COST OF contesting, BY
APPROPRIATE PROCEEDINGS, THE AMOUNT or validity of any of the aforementioned;
taxes or assessments except that Real Estate Taxes
shall not include federal income taxes or state
income taxes or state excise taxes measured by
income unless said state tax is in lieu of or a
substitution or addition in whole or in part for
ANY REAL property taxes. The term "Real Estate
Taxes for the Base Year or such "Comparison Year"
means Real Estate faxes levied during the Base Year
or such Comparison Year. In the case of special
taxes and assessments payable in installments only
the amount Or each Installment due and payable
during a single Comparison Year shall be included
in Real Estates Taxes for that year;
(v) The term "Operating Expenses" with respect to the Base Year or a
Comparison Year means those expenses incurred during such year in respect of
the operation and maintenance of the Complex in accordance with generally
accepted accounting principles of sound management as applied to the operation
and maintenance of first class office buildings in Burr Ridge Illinois,
including the cost of or charges for the following by way of illustration but
without limitation: water and sewer, insurance premiums security, maintenance
of and repairs to equipment servicing the Buildings window cleaning garbage
services, snow removal, parking lot maintenance, fire alarm fees, landscape
maintenance, administration and management of the
Exterior Buildings to the extent of.4% of the gross annual Rents,
personal property taxes or the personal
property used in the operation of the Buildings and the cost of contesting by
appropriate proceedings the applicability to the Complex or the land of the
validity of any statute, ordinance, rule or regulation affecting the Complex
and the land which might increase Operating Expenses. Operating Expenses shall
not include any capital improvements made to the land or Complex (except
Operating Expenses shall include amortization of capital improvements made
subsequent to the initial development of the Buildings which are designed with
a reasonable probability of improving the operating efficiency of the
Buildings); expenses for repairs or other work occasioned by fire, windstorm
or other insured casualty to the extent covered by insurance proceeds;
expenses incurred in leasing or procuring new tenants (for lease commissions
advertising expenses and expenses for renovating space for new tenants); legal
expenses in enforcing the term of any lease; interest or amortization
payments on any mortgage or mortgages and rental under any ground or
underlying lease or leases; salaries or other compensation paid to any
executive employees: wages, salaries or other compensation paid for clerks or
attendants in concessions or newsstands operated by Landlord; and
expenses in connection with maintaining and operating any garage operated
by Landlord; (vi) The term "Tenant's Proportionate Share" means the percentage
as detailed in Section 1.(c) multiplied by the estimated increase or decrease
in Operating Expenses and Real Estate Taxes.
(vii) Landlord reserves the right to increase the number of Buildings or the
size of some or all of the Buildings in the Complex. Upon completion of any
enlargement of or addition to the Complex Landlord shall notify Tenant of the
new total amount of useable square footage for the Complex and as such
Tenant's new Proportionate Share percentage.
Estimated Increases or Decreases in Operating Expenses
and Real Estate Taxes. Statements of the amount of Tenant's Proportionate
Share of the estimated increase or decrease in Operating Expenses and Real
Estate Taxes; relative to the Base Year shall be rendered by Landlord to
Tenant as soon as reasonably feasible after the first Year and for each
ensuing Comparison Year thereafter, except as otherwise provided in Subsection
(e) hereof with respect to any fractional period at the end of the year.
On the first day of the month following the rendition of said statements (i),
Tenant shall pay the Landlord a sum equal to one-twelfth of Tenant's
Proportionate Share of such estimated increase, if any, multiplied by
total number of months then elapsed commencing with January 1st of the current
year to and including the month following the month in which the
statement is rendered, less sums previously paid for such current period
pursuant to the provisions of (ii) which follow, and (ii) thereafter until
a Comparison Year statement for the next ensuing year shall be rendered,
the monthly Rental payable under this Lease shall be increased by an amount
equal to one-twelfth of Tenant's Proportionate Share of such estimated increase,
if any.
(d) Actual Operating Expenses and Real Estate Taxes. Landlord's statements for
each Comparison Year shall include a statement as to the actual amount of the
Tenant's Proportionate share of increase or decrease in Operating Expenses and
Real Estate Taxes for the proceeding calendar year. In the event the total
amount of monthly installments paid by Tenant pursuant to subsection (c) of
this Section for such preceding calendar year does not equal the actual
amount of Tenant's Proportionate Share of increase or decrease in Operating
Expenses and Real Estate Taxes as shown on such statements, then Tenant shall
pay to Landlord the deficiency upon receipt of such statements, or the
Landlord shall credit the excess against future estimated monthly installments
payable by Tenant, pursuant to subsection (c) of this Section. Any payment,
refund or credit shall be made without prejudice to any right of Tenant to
dispute or of Landlord to correct, any item or items, in such statements
rendered pursuant to subsection (d) hereof. Notwithstanding anything to the
contrary herein above provided, the amount of Operating Expenses and Real
Estate Taxes, shall never be decreased by the operation of this Section below
the Base Amount described in Section 8.(b)(ii).
(e) Termination. If the Term shall terminate on a date other than December
31st, the Additional Rent described in this Section 8, as previously adjusted
by this Section, shall be increased or decreased, as the case may be, for the
period commencing on the January 1st following the last full calendar year of
the Term and continuing to the end of the Term, in the manner set forth in
subsection (c) hereof, and the adjustment for such period shall be made within
20 days after Landlord shall render its statement for the last monthly
installment of the rent payable under this Lease, or if that is not reasonably
feasible as soon thereafter as is reasonably feasible, and this obligation
shall survive the expiration or earlier termination of the Lease.
(f) Disputes. If the Tenant shall dispute in writing any specific item or
items included by Landlord in determining Operating Expenses or the amount of
any Real estate Taxes, and such dispute is not amicably settled between
Landlord and Tenant within 45 days after statements therefore have been
rendered, either party may, during the 30 days next following the expiration
of the above mentioned 45 days, refer such disputed item or items to an
Independent Certified Public Accountant
<PAGE>
elected by Landlord, for DECISION, AND THE DECISION OF such accountant shall
be final, conclusive and binding upon Landlord and Tenant. Any adjustment
required by such decision shall be made within 30 days after such decision
has been rendered. The expenses involved in such determination
shall be born by the party against whom a decision is rendered by said
accountant or, if more than one item is disputed, the expenses shall be
apportioned according to the number of items decided against each party. If
Tenant shall not so dispute any item or item's of any such statement within 45
days after such statement has been rendered, Tenant shall be deemed to have
approved such statement. Landlord shall have the right for a period of 24
months after the rendering of any statement or for a longer period, if
reasonably required in order to ascertain the fact as to any change in Real
Estate Taxes or any Operating Expenses, to send corrected statements to
Tenant, and any adjustments required thereby shall be made within 30 days
thereafter. This obligation shall survive the termination of this Lease.
(9) Real Estate Tax Adjustments. If by reason of complaint against valuation,
protest of tax rates or otherwise, Real Estate Taxes for the Base Year or any
Comparison Year affected in such a way as would result in an increase or
decrease hereunder, the Real Estate Taxes for the affected Comparison Year
shall be recalculated accordingly and the resulting increase or decrease in
additional Rent, less the expenses incurred in affecting any such reduction,
shall be paid simultaneously with or applied as a credit against the
Additional Rent next becoming due. Any personal property taxes or any increase
in Real Estate Taxes by reason of capital improvements, non-standard or
special installations, alterations or fixtures made by or on behalf of the
Tenant to the premises shall be paid for by the Tenant.
(h) Non-payment of Additional Rent. In the event of non-payment of Additional
Rent payable by Tenant hereunder, Landlord shall have the same rights with
respect to such non-payment as it has with respect to any other non-payment of
Rent hereunder.
9. LANDLORD'S RECORDS: Landlord shall keep for a period of 24 months
after statements are rendered as provided in Section 8 records in reasonable
detail of the payment of Real Estate Taxes and Operating Expenses for the
period covered by such statement or statements. Tenant, at its expense, shall
have the right at all reasonable times but not more than once annually to
audit Landlord's books and records relating to this Lease for any year for
which additional rental payments become due.
10. IMPROVEMENTS: Upon expiration or sooner termination of this Lease, all
improvements and additions to the Premises, except Tenant's trade fixtures,
shall be deemed the property of Landlord.
11. CARE OF PREMISES: Tenant shall take good care of the Premises. Tenant
shall not make any alterations, additions or improvements in or to the
Premises, or make changes to locks on doors, or add, disturb or in any way
change any plumbing or wiring without first obtaining the written consent of
Landlord and, where appropriate, in accordance with plans and specifications
approved by Landlord. All damage or injury done to the Premises or Building by
Tenant or by any persons who may be in or upon the Premises or Building with
the express or implied consent of Tenant, including but not limited to the
cracking or breaking of glass of any windows and doors, shall be paid for by
Tenant and Tenant shall pay for all damage to the Building caused by acts or
omissions of Tenant or Tenant's officers, contractors, agents, invitees,
Licensees, or employees. All normal repairs necessary to maintain the Premises
and Building in a tenantable condition shall be done by or under the direction
of Landlord. Necessary repairs shall be those reasonably determined by
Landlord necessary in order to maintain the Premises and Building as a
first-class Burr Ridge office building.
Prior to the completion of construction of the Building or Complex or
completion of Tenant Improvements in the Premises to be occupied by Tenant,
Tenant shall not be obligated to move in until the giving of verbal notice by
Landlord to Tenant of the completion of such construction. Within two days
after the Landlord gives such notice, Tenant shall inspect the Premises and,
except as otherwise notified by Tenant in writing to Landlord within such
period, Tenant shall be deemed to have accepted the Premises in their then
condition. If as a result of such inspection, Tenant discovers minor
deviations or variations from the plans and specifications for Tenant's
improvements of a nature commonly found on a "punch list" (as that term is
used in the construction industry), Tenant shall promptly notify Landlord of
such deviations. The existence of such punch list items shall not postpone the
Commencement Date of this Lease nor the obligation of Tenant to pay Rent.
13. SPECIAL IMPROVEMENTS: Tenant shall reimburse Landlord for Landlord's cost
of making all special improvements requested by Tenant, including but not
limited to counters, partitioning, electrical and telephone outlets and
plumbing connections other than as shown on Exhibit D.
14. ACCESS: Tenant shall permit Landlord and its agents to enter into and upon
the Premises at all reasonable times for the purpose of inspecting the same
or for the purposes of repairing, altering or improving the Premises or the
Building. Nothing contained in this Section 14 shall be deemed to impose any
obligation upon Landlord not expressly stated elsewhere in this Lease. When
reasonably necessary and without unduly interrupting the ability of the Tenant
to conduct Tenant's business, Landlord may temporarily close entrances, doors,
corridors, or other facilities without liability to Tenant by reason of such
closure and without such action by Landlord being construed as an eviction of
Tenant or release of Tenant from any duty of observing and performing any of
the provisions of this Lease. Landlord shall have the right to enter the
Premises for any purpose of showing the Premises to prospective [tenants
within the period of 180 days prior to the expiration or sooner termination of
the Lease Term.
15. DAMAGE OR DESTRUCTION:
(a) Damage Repair. In case of damage to the Premises or the Building by fire
or other casualty, Tenant shall give immediate notice to Landlord, who to the
extent originally provided in this Lease, will cause the damage to be repaired
with reasonable speed, subject to delays which may arise by reason of
adjustment of loss under insurance policies and for delays beyond the
reasonable control of Landlord, and to the extent that the Premises are
rendered untenantable, the Rent shall proportionately abate, except in the
event that such damage resulted from or was contributed to, directly or
indirectly, by the act, fault or neglect of Tenant, Tenant's officers,
contractors, agent, employees, invitees or licensees, in which event there
shall be no abatement of Rent, except to the extent Landlord receives proceeds
from Landlord's rental income insurance policy to compensate Landlord for loss
of Rent. In the event the Premises or the Building of which the Premises are a
part are damaged as a result of any cause other than the perils covered by
fire and extended coverage insurance, then Landlord shall forthwith repair the
same, provided the extent of the destruction shall be less than ten (10%) of
the then full replacement cost of the Premises of the Building of which the
Premises are a part. In the event the destruction of the Premises or the
Building is to an extent greater than ten (10%) of the full replacement cost,
then Landlord shall have the option: (1) to repair or restore such damage,
this Lease continuing in full force and effect, but the Rent to be
proportionately reduced as herein above provided in this Section; or, (2) give
notice to Tenant at any time within sixty (60) days after such damage
terminating this Lease as of the date specified in such notice, which dates
shall be no less than thirty (30) and no more shall sixty (60) days after the
giving of such notice. In the event of giving such notice, this Lease shall
expire and all interest of the Tenant
in the Premises shall terminate on the date so specified
in such notice and the Rent, reduced by a proportionate
amount, based upon the extent, if any, to which such
damage materially interfered with the business carried
on by the Tenant in the Premises, shall be paid up to
date of such said termination.
(b) Destruction During Last Year of Term. Notwithstanding anything to the
contrary contained in this Section, Landlord shall not have any obligation
whatsoever to repair, reconstruct or restore the Premises when the damage
resulting from any casualty covered under this Section occurs during the last
twelve (12) months of the term of this Lease or any extension thereof.
(c) Business Interruption. No damages, compensation or claim shall be payable
by Landlord for inconvenience, loss of business or annoyance arising from any
repair or restoration of any portion of the Premises, Building or Complex.
Landlord shall use its best efforts to effect such repairs promptly and in
such manner as not to unreasonably interfere with Tenant's occupancy.
(d) Tenant Improvements. Landlord will not carry insurance of any kind on any
improvements paid for by Tenant or Tenant's furniture or furnishings or on any
fixtures, equipment, improvements or appurtenances of Tenant under this Lease
and Landlord (except as provided by law by reason of its negligence) shall not
be obligated to repair any damage thereto or replace the same.
(e) Express Agreement. The provisions of this Article shall be considered an
express agreement governing any case of damage or destruction of the Building
or Premises by fire or other casualty.
16. WAIVER OF SUBROGATION: Whether the loss or damage is due to the negligence
of either Landlord or Tenant, their agents or employees, or any other cause,
Landlord and Tenant do each herewith and hereby release and relieve the
other, their agents or employees, from responsibility for, and waive their
entire claim of recovery for (i) any loss or damage to real or personal
property of either located anywhere in the Complex, including the Buildings
themselves, arising out of or incident to the occurrence of any of the perils
which may be covered by their respective fire insurance policies, with
extended coverage endorsements, or
(ii) loss resulting from business interruption at the Premises or loss of
rental income from the Complex, arising out of or incident to the occurrence
of any of the perils which may be covered by the business interruption
insurance policy and by the loss of rental income insurance policy held by
Landlord or Tenant. Each party shall use reasonable efforts to cause its
insurance carriers to consent to such waiver of all rights of subrogation
against the other party. Notwithstanding the foregoing, no such release shall
be effective unless the aforesaid insurance policy or policies shall expressly
permit such a release or contain a waiver of the carrier's right to be
subrogated.
17. INDEMNIFICATION AND LIABILITY INSURANCE: Tenant shall defend and indemnify
Landlord and William H. McNaughton, and save them harmless from and against
any and all liability, damages, costs, or expenses, including attorneys fees,
arising from any act, omission, or negligence of Tenant or its officers,
contractors, licensees, agents, servants, employees, guests, invitees, or
visitors in or about the Complex or premises or arising from any accident,
injury, or damage to any person or property, occurring in
or negligence or Tenant, or its officers, contractors, licensees, agents,
servants, employees, guests, or visitors, or arising from any breach or
default under this Lease by Tenant. Tenant shall, at its own expense, keep and
maintain in full force and effect during the term of this Lease a policy of
comprehensive public liability insurance in an amount of not less shall
$300,000 for bodily injury and property damage in a combined single limit
insuring Tenant's activities with respect to the property. Such insurance
shall be construed to be primary and will be used for the defense of Landlord
and William H. McNaughton, if appropriate and in addition, the Tenant's
insurance shall not be cancelable without 30 days written notice to Landlord.
If Tenant's insurance is canceled or below the limits established herein,
Landlord may, but is not obligated to, purchase insurance for Tenant and bill
the cost of such to Tenant as additional rent. Tenant shall furnish to
Landlord upon the Lease Commencement Date and from time to time thereafter a
certificate of insurance maintained by Tenant pursuant to this Section 17.
If the foregoing provisions shall not be constructed to make Tenant
responsible for loss, damage, liability or expense resulting from
injuries to third parties caused by the negligence of Landlord or its
officers, contractors, licensees, agents, employees, or invitees: provided,
however, that in no event shall Landlord be liable to Tenant for any damage
to the Premises or for any loss, damage or injury to any property of Tenant
therein or thereon occasioned by bursting, rupture, leakage or overflow
of any plumbing or other pipes (including, without limitation, water, steam
and/or refrigerant lines), sprinklers, tanks, drains, drinking fountains or
washstands, or other similar cause in, above, upon or about the Premises or
the Complex unless caused by the negligence of Landlord or its officers,
contractors, licensees, agents, employees or invitees. Tenant, however,
agrees to insure its property against such perils. Landlord shall not be
liable for any loss or damage to person or property sustained by Tenant,
or other persons, which may be caused by theft, or by any act or neglect
of any Tenant or occupant of the Complex. Landlord or its agents shall
not be liable for interference with the light or other
incorporeal hereditaments, loss of business by Tenant, nor shall Landlord be
liable for any latent defect in the Premises or in the Complex. Tenant shall
give prompt notice to Landlord in case of fire or accidents in the Premises or
in the Building or of defects therein or in the fixtures or equipment.
18. ASSIGNMENT AND SUBLETTING:
(a) Assignment: Sublet. Tenant shall not assign or mortgage this Lease, sublet
all or any portion of the Premises or permit the use of all or part of the
Premises by any party other than Tenant without Landlord's prior written
consent. Landlord shall have the right to reasonably withhold its consent.
Tenant's request of Landlord's consent to assign, mortgage or sublet shall be
accompanied by a certified copy of the proposed assignment, mortgage or
sublease. This Lease shall not be assignable by operation of law. Except as
provided herein, no assignment, mortgaging, subletting, or use shall relieve
Tenant of its liability under this Lease. Consent by Landlord shall not
operate as a waiver of the necessity for consent to any subsequent assignment,
mortgaging, subletting or use and the terms of such consent shall be binding
upon each assignee, mortgagee or subtenant. Assignees or subtenants shall
become directly liable to Landlord for all obligations of Tenant under this
Lease. If Tenant is a corporation, an assignment forbidden under this Lease
shall include one or more sales or transfers, by operation of law or
otherwise, or creation of new stock, by which an aggregate of more than fifty
percent (50%) of Tenant's stock shall be vested in a party or parties who are
non-stockholders on the Commencement Date. Any transfer of this Lease by
merger, consolidation, share exchange or liquidation, or any change in the
ownership of or power to vote the majority of its outstanding voting stock,
shall constitute an assignment, whether the result of a single or series of
transactions. This paragraph shall not apply if Tenant's stock is listed on a
recognized security exchange.
(b) Recapture of Premises. Tenant shall, together with
Tenant's request of Landlord's consent to assign this Lease or sublet more
than twenty-five percent (25%) of the floor area of the Premises, offer to
Landlord in; writing, the right to recapture all or any part of the ;
Premises which Tenant proposes to assign or sublet. Upon receipt of such
offer, Landlord shall have the option, to be exercised within fourteen (14)
days following receipt, to accept the offer to recapture. If Tenant proposes
to assign this Lease and Landlord accepts Tenant's offer to recapture, Tenant
shall be released from liability under this Lease. If Tenant proposes to
sublet more than twenty-five percent (25%) of the floor area of the Premises
and Landlord accepts Tenant's offer to recapture, the Rent, Additional Rent
and Tenant's Proportionate Share shall be reduced by a fraction the numerator
of which is the subleased floor area and the denominator of which is the total
floor area of the Premises. Tenant agrees to promptly execute an amendment to
this Lease reflecting such modifications. If Landlord does not exercise its
option within the fourteen (14) day period, Tenant may, provided Landlord
consents thereto in writing pursuant to paragraph 18 (a), assign or sublet
within ninety (90) days from the date of Tenant's request to the person or
entity and upon the terms and conditions provided in the assignment or
sublease submitted to Landlord.
(c) Transfer: Assignment: Conveyance. Landlord shall have the right to assign,
transfer, or convey in whole or in part, Landlord's interest in this Lease,
the Premises, and the Complex. If Landlord shall assign its interest under
this Lease or transfer or convey its interest in the Premises or the Complex,
other than a transfer or conveyance for security purposes only, such assignee,
transferee, or grantee shall thereafter be deemed to the Landlord hereunder,
Tenant shall attorn to Landlord's assignee, transferee, or grantee and
Landlord shall be relieved of any obligation accruing hereunder after such
assignment, transfer or conveyance.
19. ADVERTISING: Tenant shall not inscribe any inscription or post, place, or
in any manner display any sign, graphics, notice, picture, placard or poster,
or any advertising matter whatsoever, anywhere in or about the Premises or the
Complex at places visible (either directly or indirectly as an outline or
shadow on a glass pane) from anywhere outside the Premises or at the entrance
to the Premises without first obtaining Landlord's written consent thereto,
such consent to be at Landlord's sole discretion. Any such consent by Landlord
shall be upon the understanding and condition that Tenant will remove the same
at the expiration or sooner termination of this Lease and Tenant shall repair
any damage to the Premises or the Building caused thereby.
20. LIENS AND INSOLVENCY: Except with respect to activities for which Landlord
is responsible, Tenant shall pay as due all claims for work done on and for
services rendered or material furnished to the Premises and shall keep the
Premises, Buildings and land upon which the Building is located free from any
Liens. If Tenant fails to pay any such claims or to discharge any Lien,
Landlord may do so and Tenant shall pay Landlord the amount so expended on
demand. Such action by Landlord shall not constitute a waiver of any right or
remedy which Landlord may have on account of Tenant's default. Tenant my
withhold payment of any claim in connection with a good-faith dispute over the
obligation to pay, so long as Landlord's property interests are not
jeopardized. If a Lien is filed as a result of nonpayment, Tenant shall,
within 10 days after knowledge of the filing, secure the discharge of the Lien
or deposit with Landlord cash or sufficient corporate surety bond or other
surety satisfactory to Landlord in an amount sufficient to discharge the Lien
plus any costs, attorney fees, and other charger that could accrue as a result
of a foreclosure or sale thereunder.
21. DEFAULT:
(a) Cumulative Remedies All rights and remedies of Landlord and Tenant herein
enumerated shall be cumulative, and none shall exclude any other right or
remedy allowed by law. In addition, to the other remedies in this Lease
Landlord shall be entitled to the restraint by injunction of the violation or
attempted violation of any of the covenants, agreements or conditions of this
Lease.
(b) Tenant's night to Cure. Tenant shall have a period of five (5) days from
the first day of each month within which to pay Rent, adjustments thereto and
the Additional Rents due hereunder. Without further notice, Tenant shall be
deemed to be in default if said rent, adjustments and Additional Rents are not
received by Landlord within said time period. In addition, Tenant shall have
a period of fifteen (15) days from the date of written notice from Landlord to
Tenant within which to cure any other default hereunder; provided, however,
that with respect to any default which cannot be cured within said 15 days,
the default shall not be deemed to be uncured if Tenant commences to cure
within 15 days and for so long as Tenant is diligently prosecuting the cure
thereof.
(c) Landlord's Re-entry. Upon an uncured default of this Lease by Tenant,
Landlord, in addition to other rights or remedies it may have, at its option,
may enter the Premises or any part thereof, either with or without process of
law, and expel, remove or put out Tenant or any other persons who may be
thereon, together with all personal property found therein; and Landlord may
terminate this Lease, or it may from time to time, without terminating this
Lease and as agent of Tenant, relate the Premises or any part thereof for such
term or terms (which may be for a term tress than or extending beyond the
Term) and at such Rental or Rentals and upon such other terms and conditions
as Landlord in its sole discretion may deem advisable, with the right to
repair, renovate, remodel, redecorate, alter and change the Premises, Tenant
remaining liable for any deficiency computed as hereinafter set forth. In the
case of any default, re-entry; and/or dispossession by summary proceedings or
otherwise, all annual base Rental, adjustments thereto and Additional Rents
shall become due thereupon and be paid up to the time of such re-entry or
dispossession, together with such expenses as Landlord may incur for legal
expenses, attorney's fees, brokerage and/or putting the Premises in good order
or preparing the same for re-rental.
(d) Re-Letting the Premises. At the option of Landlord, rents received by
Landlord from such re-letting shall be applied first to the payment of any
indebtedness from Tenant to Landlord other than Rent due hereunder; second, to
the payment of any costs and expenses of such re-letting and including, but
not limited to, attorney's fees, advertising fees and brokerage fees, and to
the payment of any repairs; renovations, remodeling, redecoration, alterations
and changes in the Premises; third, to the payment of Rent due and to become
due hereunder, and, if after so applying said Rentals there is any deficiency
in the Rent to be paid by Tenant under this Lease, Tenant shall pay any
deficiency to Landlord monthly on the Rent Day specified herein and any
payment made or suit brought to collect the amount of the deficiency for any
montl1 shall not prejudice in any way the right of Landlord to collect the
deficiency for any subsequent month. The failure or refusal of Landlord to
re-let the Premises or any part or parts thereof shall not release or affect
[tenant's liability hereunder, nor shall Landlord be liable for failure to
re-let, or in the event of re-letting, for failure to collect the Rent
thereof, and in no event shall Tenant be entitled to receive any excess of net
Rents collected over sum payable by Tenant to Landlord hereunder. No such
re-entry or taking possession of the Premises shall be construed as an
election on Landlord's part to terminate this Lease unless a written notice of
such intention be given to Tenant. Notwithstanding any such re-letting without
termination, Landlord may at any time thereafter elect to terminate this Lease
for such previous breach and default. Should Landlord at any time terminate
this Lease by reason of any default, in addition to any other remedy it may
have, it may recover from Tenant the amount of Rental and charges equivalent
to annual Rental, adjustments thereto and Additional Rent reserved in this
Lease for the balance of the Term, as it may have been extended, over the then
fair market Rental value of the Premises for tile same period, plus all court
costs and attorney's fees incurred by Landlord in the collection of same.
(e) Waiver of Redemption nights. Tenant, for itself, and on behalf of any and
all persons claiming through or under it, including creditors of all kinds,
does hereby waive and surrender all right and privilege which they or any of
them might have under or by reason of any present or future law, to redeem the
Premises or to have a continuance of this Lease for the Term, as it may have
been extended, after having been dispossessed or ejected there from by process
of law or under the terms of this Lease or after the termination of this Lease
as herein provided.
(f) Non-Payment of Additional Rent. All costs and expenses which Tenant
assumes or agrees to pay to Landlord pursuant to this Lease shall be deemed
Additional Rent and, in the event of non-payment thereof, Landlord shall have
all the rights and remedies herein provided for in case of non-payment of
Rent.
22. PRIORITY: This Lease is and shall be prior to any mortgage or deed of
trust ("Encumbrance") recorded after the date of this Lease and affecting the
Premises. However, if any Lender holding such an Encumbrance requires that
this Lease be subordinate to the Encumbrance, then Tenant agrees that the
Lease shall be subordinate to the Encumbrance if the holder thereof agrees in
writing with Tenant that so long as Tenant performs its obligations under
this Lease no foreclosure, deed given in lieu of foreclosure, or sale pursuant
to the terms of the Encumbrance, or other steps or procedures taken under the
Encumbrance shall affect Tenant's rights under this Lease. If the foregoing
condition is met, Tenant shall execute a written agreement and any other
documents required by the holder of the Encumbrance to accomplish the purpose
of this paragraph. If the Premises are sold as a result of the foreclosure of
any Encumbrance thereon, or otherwise transferred by Landlord or any
successor, Tenant shall attorn to the purchase or transferee.
23. SURRENDER OF POSSESSION: Upon termination of this Lease, whether caused by
lapse of time or otherwise, Tenant shall at once surrender possession of the
Premises and deliver Premises to Landlord in first class condition, reasonable
wear and tear and damage or destruction by fire or other casualty which
Tenant is not obligated to repair excepted. Upon surrender, all right, title
and interest of Tenant in Premises shall cease. Tenant shall deliver all keys
to the Premises to Landlord. If possession is not immediately surrendered,
Landlord may take possession of the Premises and expel or remove Tenant and
any other person occupying all or a portion of the Premises, by force if
necessary, without civil or criminal liability.
24. REMOVAL OF PROPERTY: All Tenant's fixtures installed upon the Premises
prior to or during the term of this Lease, other than Tenant's trade fixtures,
shall, at the expiration or other termination of this Lease, become the
property of Landlord. All Tenant's trade fixtures, furniture and equipment
shall be removed by Tenant prior to termination of this Lease. All such
removals shall be accomplished in a workmanlike manner so as not to damage the
Premises, the structure or structural qualities of the Building or the
plumbing, electrical lines or other utilities. Upon expiration or sooner
termination of this Lease, all of Tenant's trade fixtures, personal property
and improvements remaining in the Premises or the Building shall be deemed
conclusively to have been abandoned by Tenant and may be appropriated, sold,
destroyed or otherwise disposed of by Landlord without notice or obligation to
compensate Tenant or to account therefor, and Tenant shall pay Landlord on
demand all costs incurred by Landlord in connection therewith. No act or
omission by Landlord, its agents or employees during the Lease term, including
delivery of keys to any of Landlord's agents or employees, shall be deemed an
acceptance of a surrender of the Premises and no agreement to accept surrender
of the Premises shall be valid unless in writing signed by Landlord.
25. WAIVER: The Waiver by Landlord of any term, covenant or condition herein
contained shall not be deemed to be a waiver of such term, covenant or
condition on any subsequent breach of the same or any other term, covenant or
condition herein contained. The subsequent acceptance of Rent hereunder by
Landlord shall not be deemed to be a Waiver of any preceding breach by Tenant
of any term, covenant or condition of this Lease, other than the failure of
the Tenant to pay the particular rental so accepted, regardless of Landlord's
knowledge of such preceding breach at the time of the acceptance of such
Rent.
26. HOLDOVER: If Tenant shall, with the written consent of Landlord, hold
over after the expiration of the term of this Lease, such tenancy shall be
deemed a month-to-month tenancy, which tenancy may be terminated as provided
by applicable state law. During such tenancy, Tenant agrees to pay to
Landlord a rental in the amount of one and one-half (1 1/2) times the last
monthly rental, plus all other charges payable hereunder, and upon all the
terms hereof applicable to a month-to-month tenancy.
27. CONDEMNATION
(a) Entire Taking. If all of the Premises or such portions of the Building or
Complex as may be required for the reasonable use of the Premises, are taken
by eminent domain, this Lease shall automatically terminate as of the date
title vests in the condemning authority and all Rents, Additional Rents and
other payments shall be paid to that date.
(b) Partial Taking. In case of a taking of a part of the Premises, or a
portion of the Building or Complex not required for the reasonable use of the
Premises, then this Lease shall continue in full force and effect and the Rent
shall be equitably reduced based on the proportion by which the floor area of
the Premises is reduced, such Rent reduction to be effective as of the date
title to such portion vests in the condemning authority.
(c) Termination by Landlord. If in the event that title to a part of the
Building other than the Premises shall be so condemned or taken and if in the
opinion of the Landlord, the Building can only be restored in such a way as to
alter the Premises materially, the Landlord may, but is not obligated to
terminate this Lease by notifying the Tenant in writing, of such decision to
terminate within 60 days following the date of vesting of title, and this
Lease and the term and estate hereby granted shall expire on the date
specified in the notice of termination, not less than 60 days after the giving
of such notice, as fully and completely as if such date were the date
hereinbefore set forth as the expiration of the term of this Lease, and the
rent hereunder shall be apportioned as of such date.
(d) Awards and Damages. Landlord reserves all rights to damages for any
partial or entire taking by eminent domain of the Premises, and Tenant hereby
assigns to Landlord any right Tenant may have to such damages or award, and
Tenant shall make no claim against Landlord or the condemning authority for
damages for termination of the leasehold interest or interference with
Tenant's business. tenant shall have the right, however, to claim and recover
from the condemning authority compensation for any loss to which Tenant may be
put, for Tenant's moving expenses, business interruption or taking of Tenant's
personal property (not including Tenant's Leasehold interest) provided that
such damages may be claimed only if they are awarded separately in the eminent
domain proceedings and not out of or as part of the damages recoverable by
Landlord.
28. NOTICES: All notices under this Lease shall be in writing and delivered in
person or sent by registered or certified mail postage prepaid to Landlord at
the address provided in Section l(i), and to Tenant at Tenant's Premises, and
to the holder of any first mortgage or deed of trust at such place as such
holder shall specify to Tenant in writing; or such other addresses as may from
time to time be designated by any such party in writing. Notices mailed as
aforesaid shall be deemed given on the date of such mailing.
29. COSTS AND ATTORNEY'S FEES: If Tenant or Landlord shall bring any action
for any relief against the other, declaratory or otherwise, arising out of
this Lease, including any suit by Landlord for the recovery of Rent,
Additional Rent or other payments hereunder or possession of the Premises, the
losing party shall pay the prevailing party a reasonable sum for attorney's
fees in such suit, at trial and on appeal, and such attorney's fees shall be
deemed to have accrued as of the commencement of such action.
30. LANDLORD'S LlABlLlTY: Anything in this Lease to the contrary
notwithstanding, covenants, undertakings and agreements herein made on the
part of the Landlord are made and intended not as personal covenants,
undertakings and agreements or for the purpose of binding Landlord personally
or the assets of Landlord except Landlord's interest in the Premises and
Complex, but are made and intended for the purpose of binding only the
Landlord's interest in the Premises and Complex as the same may from time to
time be encumbered. No personal liability or personal responsibility is assumed
by, nor shall at any time be asserted or enforceable against, Landlord or its
partners or their respective heirs, legal representatives, successors, and
assigns on account of the Lease or on account of any covenant, undertaking or
agreement of Landlord in this Lease contained.
31. ESTOPPEL CERTIFlCATES: Tenant shall, from time to time upon not less than
ten (IO) day's prior written notice, execute, acknowledge and deliver to
Landlord or its designee a written statement stating: The date this Lease was
executed and the date it expires; the date Tenant entered into occupancy of
the Premises; the amount of monthly Rent and the date to which such Rent has
been paid; and certifying: That this Lease is in full force and effect and has
not been assigned, modified, supplemented or amended in any way (or specifying
the date and terms of agreement so affecting this Lease); that this Lease
represents the entire agreement between the parties as to this Leasing; that
all conditions under this Lease to be performed by the Landlord have been
satisfied, including, but without limitation, all co-tenancy requirements, if
any; that all required contributions by Landlord to Tenant on account of
Tenants Improvements have been received; that on this date there are no
existing defenses or offsets which the Tenant has against the enforcement of
this Lease by the Landlord; that no Rent has been paid more than one month In
advance; and that no security has been deposited with Landlord (or, if so, the
amount thereof). It is intended that any such statement delivered pursuant to
this paragraph may be relied upon by a prospective purchaser of Landlord's
interest or a mortgagee of Landlord's interest or assignee of any mortgage
upon Landlord's interest in the Complex. If Tenant shall fail to respond
within 10 days of receipt by Tenant of a written request by Landlord as herein
provided, Tenant shall be deemed to have given such certificate as above
provided without modification and shall be deemed to have admitted the
accuracy of any information supplied by Landlord to a prospective purchaser or
mortgagee and that this Lease is in full force and effect, that there are not
uncured defaults in Landlord's performance, that the security deposit as
stated in this Lease, and that not more than one month's Rent has been paid in
advance.
32. TRANSFER OF LANDLORD'S INTEREST: In the event of any transfer or transfers
of Landlord's interest in the Premises or in the Complex, other than a
transfer for security purposes only, the transferor shall be automatically
relieved of any and all obligations and liabilities on the part of Landlord
accruing from and after the date of such transfer and Tenant agrees to attorn
to the transferee.
33. RIGHT TO PERFORM: If Tenant shall fail to pay any sum of money, other than
Rent and/or Additional Rent required to be paid by it hereunder, or shall fail
to perform any other act on its part to be performed hereunder, and such
failure shall continue for 10 days after notice thereof by Landlord, Landlord
may, but shall not be obligated so to do, and without waiving or releasing
Tenant from any obligations of Tenant, make any such payment or perform any
such other act on Tenant's part to be made or performed as provided in this
Lease. Landlord shall have (in addition to any other right or remedy of
Landlord) the same rights and remedies in the event of the non-payment of sums
due under this Section as in the case of default by Tenant in the payment of
Rent .
34. GENERAL PROVISIONS:
(a) Headings: The titles to sections of this Lease are not a part of this
Lease and shall have no effect upon the construction or interpretation of any
part hereof.
(b) HEIRS AND ASSIGNS. All of the covenants, agreements, terms and conditions
contained in this Lease shall inure to and be binding upon Landlord and
Tenant, and their respective heirs, executors, administrators, successors and
assigns.
(c) Brokers; Tenant represents and warrants to Landlord it has not engaged any
broker, finder or other person who would be entitled to any commission or fees
in respect of the negotiation, execution or delivery of this Lease and shall
indemnify and hold harmless landlord against any loss, cost, liability or
expense created by any such broker, finder or other person on the basis of any
arrangements or agreements made or alleged to have been made by or on behalf
of Tenant., The provisions of this Section 35(c) shall not apply to brokers
with whom Landlord has an express written brokerage agreement.
(d) Entire Agreement. This Lease contains all covenants and agreements between
Landlord and Tenant relating in any manner to the Additional Rent, use and
occupancy of the Premises and Tenant's use of the Building and other matters
set forth in this Lease. No prior agreement or understanding pertaining to the
same shall be valid or of any force or effect and the covenants and agreements
of this Lease shall not be altered, modified or added to, except in writing,
signed by both Landlord and Tenant.
(e) Severability. Any provision of this Lease which shall prove to be invalid,
void or illegal shall in no way affect, impair or invalidate any other
provision hereof and the remaining provisions hereof shall nevertheless remain
in full force and effect.
(f) Open Occupancy. To the extent required by Law, this Building shall be and
open occupancy building.
(g) Overdue Payments. Any Rent, Additional Rent or additional sums payable by
Tenant to Landlord under this Lease which shall not be paid upon the due date
thereof, shall bear interest at the Ford City Bank prime lending rate plus
three (3) percentage points, accrued from date of delinquency to the date of
payment. Under no circumstances will the interest rate charged on overdue
payments exceed the maximum allowable interest rate permitted by the State of
Illinois.
(h) Force Majeure. Time periods for Landlord's performance under any
provisions of this Lease shall be extended for periods of time during which
the Landlord's performance is prevented due to circumstances beyond it's
control, including without limitation, strikes, embargoes, governmental
regulations, acts of God, war or other strife.
(i) Right to Change Common Areas. Landlord shall have the right at any time
after the completion of the Building without thereby creating an actual or
constructive eviction or incurring any liability to Tenant therefor, to change
the arrangement or location of the common areas so long as they are not
contained within the Premises.
(j) Governing Law. This Lease shall be governed by and construed in accordance
witl1 the Laws of the State of ILLINOIS.
(k) Parking. Tenant shall have the right to use in common with other Tenants
or occupants of the Complex, the parking facilities of the Complex, subject to
the observance of all rules and regulations set forth by Landlord, which
rules and regulations may be modified or expanded by Landlord, at any time
during the Term of this Lease. Any dispute between Tenant's of the Building
concerning the use of the parking facilities will be promptly reported to the
Landlord for resolution and Landlord's decision, concerning such parking
disputes, shall be final and unappealable. There shall be no assigned parking
anywhere in the Complex.
(1) Landlord may at it's discretion, convert the use of the Complex from that
of a rental property to a condominium property and as such may sell all or
part of the Complex and may institute a condominium association and have all
other rights and privileges associated with a condominium development in the
State of lllinois. Said conversion however, will not modify or nullify the
terms and conditions of this lease which shall remain in full force and
effect throughout its Term and any extensions thereof.
m) Tenant to provide for janitorial, interior window washing and pay for gas
and electric utilities.
IN WITNESS WHEREOF, this Lease has been executed on this the _________ day of
____________, 19_____
LANDLORD: WOODLAND PARK PROPERTIES
BY: ______________________
William H. McNaughton
TITLE: President_________
TENANT:__________________
BY:______________________
TITLE: __________________
BY: _____________________
TITLE: ___________________
<PAGE>
EXHIBIT A
LEGAL DESCRIPTION
LOTS 2 S 3, EXCEPTlNG FROM SAID LOT 3 ALL TIIAT PART DESCRIBED AS FOLLOWS:
Beginning at the Northeast corner of said Lot 3; thence N89 degrees 57" and
42'W along the North line of said Lot 3 a distance of 160.12 feet; thence SOO
degrees 02' and 18"W a distance of :143.49 feet to the most Easterly line of
said Lot 3; thence N48 degrees 10' and 31"E along the last described line a
distance of 215.01 feet to the said point of beginning, all in the Hinsale
Meadowbrook Farms, being a subdivision of the West half of the Southeast
Quarter of Section 35, Township 38 North, flange 11 East of tile Third
Principal Meridian, excepting the South 175.00 feet of the West 350.00 feet
according to the Plat thereof recorded April 25,1952 as document #650073 and
Certificate of Correction
21.
EXHIBIT C
DESCRIPTION OF LANDLORD'S WORK RESPONSIBILITY
DESCRIPTION OF TENANT'S WORK RESPONSIBILITY
Landlord agrees to complete at his expense modifications to the Tenant's
space as follows:
1. Provide Bigelow Rocky Mount Loop Carpet # 451 7_8008~Shell
throughout space.
2. Repaint all walls light beige color to be chosen by Landlord.
3. Replace any ceiling tiles badly stained.
4. Adjust all window blinds.
5. Re-key door.
6. Door sign to be done by Tenant.
7 Menu sign to be done by Landlord to read "General Acceptance Corp."
8. Remove all flush mount telephone wiring.
9. Remove security system.
10. Computer wiring to be fished into mechanical room for possible
future use of Tenant.
11. All 2'4" lay in fixtures to be cleaned.
TENANT'S WORK RESPONSIBILITIES
1. All wiring for an Installation of telephones, fax machines,
computers and security system, if any, by Tenant.
23.
EXHIBIT E
RULES AND REGULATIONS
1. No sign, placard, picture, advertisement, name or notice shall be
inscribed, displayed or printed or affixed on or to any part of the outside or
inside of the Building without the written consent of Landlord first had and
obtained and Landlord shall have the right to remove any such sign, placard,
picture, advertisement, name or notice without notice to and at the expense of
Tenant,
All approved signs or lettering on doors shall be printed,
painted, affixed, or inscribed et the expense of Landlord by a person approved
of by Landlord.
2. Tenant shall not place anything or allow anything to be placed near the
glass of any window, door, partition or wall which may appear unsightly from
outside the Premises: provided, however, that Landlord may furnish and install
a Building standard window covering at all exterior window. Tenant shall not
without prior written consent of Landlord cause or otherwise sunscreen any
window,
The sidewalks, halls, passages, exits, entrances, elevators and stairways
shall not be obstructed by any of the tenants or used by them for any purpose
other than for ingress and egress from their respective Premises.
3. Tenant shall not alter any lock or install any new or additional locks or
any bolts on any doors or windows of the Premises.
4. The toilet rooms, urinals, wash bowls and other apparatus shall not be used
[or any purpose other than that for which they were constructed and no Foreign
substance of any kind whatsoever shall be thrown therein and the expense of
any breakage, stoppage or damage resulting from the violation of this rule
shall be borne by the Tenant, who, or whose employees or invitees shall have
caused it.
5. Tenant shall not overload the floor of the Premises or in any way deface
the Premises or any part thereof.
6. No furniture, freight or equipment of any kind shall be brought into the
Building without the prior notice to Landlord all moving of the some Into or
cut of the Building shall be done at such time and in such manner as Landlord
shall designate. Landlord shall have the right to prescribe weight, size, and
position of all safes and other heavy equipment brought into the Building and
also the times and manner Of moving the same In and out Or the Building, safes
or other heavy objects shall if considered necessary by landlord, stand on
supports of such thickness as if necessary to properly distribute the weight.
Landlord will not be responsible for lose of or damage to any such safe or
property from any cause and all damage done to the Building by moving or
maintaining any such safe or other property shall be repaired at the expense
of Tenant.
7. Tenant shall not use, keep or permit to be used or kept any foul or noxious
gas or substance in the Premises, or permit or suffer the Premises to be
occupied or used in a manner offensive or objectionable to the Landlord or
other occupants of the Building by reason of noise, odors and/or vibrations,
or interfere in any way with other tenants or those who have business therein,
nor shall Any animals or birds be brought in or kept in or about the Premises
or the Building.
<PAGE>
24
9. Tenant shall not use or keep in the Premises or the Building any kerosene,
gasoline or f1ammable or combustible fluid or material, or use any method of
heating or air conditioning other than that supplied by Landlord.
10. Landlord will direct electricians as to where end how telephone and
telegraph wires are to be introduced. No boring or cutting for wires will be
allowed without the consent of the Landlord. The location of telephone, call
boxes and other office equipment af1xed to the Premises shall be subject to
the approval of Landlord.
11. Landlord reserves the right to exclude or expel from the Building any
person who, in the Judgment of Landlord, is intoxicated or under the
influence of liquor or drugs, or who shall in any manner do any act In
violation of any of the rules
and regulations of the Building.
12. No vending machine or machines of any description shall installed,
maintained or operated upon the Premises without the written consent of the
Landlord.
13. Landlord shall have the right, exercisable without notice and without
liability to Tenant, to change the name and street address of the Building of
which the Premises are a part.
14. Tenant shall not disturb, solicit, or canvas any occupant of the Building
and shall cooperate to prevent same.
15. Without the written consent of Landlord, Tenant shall not use the name of
the Building in connection with or In promoting or advertising the business of
Tenant except as Tenant's address,
16. Landlord shall have the right to control and operate the public portions
of the Building, and the public facilities, and heating and air conditioning,
as well as facilities furnished for the common use of the Tenant, in such
manner as it deems best for the benefit of the Tenants generally.
17. All entrance doors In the Premises shall be left locked when the Premises
are not In use, and all doors opening to public corridors shall be kept closed
except for normal ingress and egress from the Premises,
18. The Landlord shall in no case be liable for damages for any error with
regard to the admission to or exclusion from the Building of any person, In
case of invasion, mob, riot, public excitement, or other commotion, the
Landlord reserves the right to prevent access to the Building during the
continuance of the same by closing of the dove or otherwise, for the safety of
the tenants and protection of property in the Building and the Building.
19, It is understood that the Landlord is not providing any type of janitorial
services during the term of this Lease or any extensions thereof.
25.
RIDER NO. 1
WOODLAND PARK PROPERTIES
RENT, TERM AND COMMENCEMENT
This Lease is for a term of 36 months commencing June 1, 1996 and
ending May 31, 1999.
Tenant's obligation to pay the monthly rental pursuant to this Rider shall
begin June 1, 1996. (this date is the beginning of the first year of the
Initial Lease Term and known as the Rent Commencement Date.
Tenant's obligation to pay his prorate share of taxes and any other charges
which are deemed additional rent herein shall begin on June 1, 1996.
The parties agree, within thirty (30) days of occupancy, to execute an
agreement vetting forth the Rent Commencement Date or the date that Tenant's
obligation to pay taxes and other charges deemed as additional rent (i.e. CAM)
falls on other than the first of a month, Then all monies due will be prorated
(if other than is stated above).
Tenant agrees to pay to the Landlord for each Lease Year the following monthly
Base Rent in equal monthly installments on the first of each calendar month
included in the Lease Term, commencing as provided In this Rider and
continuing thereafter for the Term of the Lease. Subsequent Lease Years shall
be consecutive twelve (12) month calendar periods thereafter (unless otherwise
stated).
1. For the first year of the Initial Lease term (6/1/96 to 5/31/97), the
Tenant shall pay a sum of $38,448 in equal monthly payments of 53,204.
2. For the second year of the Initial Lease Term (6/1/97 to 5/31/98) the
Tenant shall pay a sum of $39,752, in equal monthly payments of $3,313.
3. For the third year of the Initial Lease Term (6/1/98 to 5/31/99), the
Tenant shall pay a sum of S41,076, in equal monthly payments of S3,423.
NOTE:
Tenant understands and agrees to the following: for the 1st floor space of 540
square feet and the loft of 256 square feet, both located in the Northwest
quadrant of the building. The gas and electric meter along with the thermostat
is located in the neighboring tenant's space (Advantage Communications).
Tenant's share of gas and electric costs of 43.5% (796 square feet ~ 1832
square feet) will be paid to neighboring tenant upon neighboring tenant
providing copies of monthly invoices from the utility companies. Neighboring
tenant's lease outlines this procedure and understands the need to cooperate
with one another.
Following are noted to be part of the lease:
1. Tenant may change locks from time to time, however, is required to provide
keys to landlord to comply with fire department regulations.
2. Tenant is allowed to keep car's overnight, except In winter season, to
allow for snow removal.
RIDER NO. 2
WOODLAND PARK PROPERTIES
OPTION TO RENEW LEASE TERM
Tenant is hereby granted the privilege and option to renew this Lease once
upon all the terms and conditions herein set forth, except as otherwise
provided herein, for a period of (2) years (the Renewal Lease Term"). The
Renewal Lease Term shall begin on the day following the last day of the
Initial Lease Term provided however; that at Landlord's option Tenant cannot
renew this Lease if Tenant is in default under any of its obligations under
this Lease on the date the option is exercised, and that Tenant shall give
written notice to Landlord of such election to exercise the option at least
one hundred eighty (180) days prior to the last day of the Initial Lease Term.
If Tenant shall fail to give said notice, then the option shall expire and be
null and void. The amount of rent to be paid by Tenant to Landlord during the
Renewal Lease Term shall be as follows:
1. For the first year (6/1/99 to 5/31/00) of the Renewal Lease Term,
the Tenant shall pay a sum of Forty Two Thousand Three Hundred Ninety and
00/100 ($42,390) in equal monthly payments of Three Thousand Five
Hundred Thirty Three and 00/100 ($3,533).
2. For the second year (8/1/00) to 5/31/01) of the Renewal Lease
Term, the Tenant shall pay a sum of Forty Three Thousand Seven Hundred Four
and 00/100 ($43,704) In equal
monthly payments of Three Thousand Six Hundred Forty Two and 00/100 ( $3 ,642
) .
<PAGE>
<PAGE>
Exhibit 10.64
GE CAPITAL
General Electric Capital Corporation
P.O. Box 310, Barrington, IL 60011
708-381-6600
May 10, 1996
VIA FACSIMILE AND FEDERAL EXPRESS
Malvin Algood, Chief Executive Officer
General Acceptance Corporation
5015 W. State Road 46, Suite N
Bloomington, IN 47404
RE: Loan and Security Agreement with General Electric Capital
Corporation
Deal Al:
Reference is made to that certain Loan and Security Agreement dated as of
May 1, 1992, as amended, between Borrower and Lender (the "Loan Agreement")
and to the Forbearance Agreement executed by the parties in the form of a
letter dated March 20, 1996 (the "Forbearance") (together, the "Agreement").
All terms used in this letter without definition shall have the meaning given
to such terms in the Agreement.
Pursuant to our conversation of May 9, 1996, Lender agrees to amend the
Forbearance as follows:
Exhibit D (Delinquency and Losses) of the Forbearance is hereby deleted
in its entirety and a new Exhibit D (attached hereto) substituted therefor.
All other terms and conditions of the Agreement shall remain in full
force and effect.
Very truly yours,
General electric Capital Corporation
By: /s/ Jim Bolger
Its: Authorized Representative
ACKNOWLEDGED AND AGREED:
General Acceptance Corporation
By: /s/ M. L. Algood
Its: Chairman and Chief Executive Officer
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT D
Delinquency and Losses
<S> <C>
Calendar Month End For 1996 30 Day Delinquency Percentage
- ---------------------------- -----------------------------------
January 11.0%
February 10.5%
March 9.0%
April 8.0%
May 7.0%
June 7.0%
Calendar Month End 1996 Cumulative Net Charge -Off Losses
- ---------------------------- -----------------------------------
January $ 2,750,000
February $ 4,750,000
March $ 8,250,000
April $ 10,750,000
May $ 12,500,000
June $ 14,250,000
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Exhibit 11.1
GENERAL ACCEPTANCE CORPORATION
Statement Re: Computation of Per Share Earnings
Exhibit 11.1
<S> <C> <C>
THREE MONTHS
ENDED MARCH 31,
-----------------
1996 1995
(HISTORICAL) (PRO FORMA)
Primary:
Weighted average shares outstanding 6,022,000 4,064,000
Net affect of dilutive stock options - based on
the treasury stock method using the average
market price --- ---
Adjustment for shares required to pay
undistributed S Corporation earnings using
the initial public offering price --- 397,961
Total weighted average shares 6,022,000 4,461,961
============= =================
Net income $ 223,445 $ 885,952
============= =================
Per share amount $ 0.04 $ 0.20
============= =================
Fully diluted:
Weighted average shares outstanding 6,022,000 4,064,000
Net effect of dilutive stock options - based on
the treasury stock method using the period-
end market price, if greater than average
market price --- ---
Adjustment for shares required to pay
undistributed S Corporation earnings using
the initial public offering price --- 397,961
Total weighted average shares outstanding 6,022,000 4,461,961
============= =================
Net income $ 223,445 $ 885,952
============= =================
Per share amount $ 0.04 $ 0.20
============= =================
</TABLE>
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the company's
unaudited financial statements as of and for the three months ended
March 31, 1996, and is qualified in its entirety by reference to such
statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 683739
<SECURITIES> 0
<RECEIVABLES> 122751132
<ALLOWANCES> 15857856
<INVENTORY> 10742962
<CURRENT-ASSETS> 0
<PP&E> 1884346
<DEPRECIATION> 0
<TOTAL-ASSETS> 127206596
<CURRENT-LIABILITIES> 0
<BONDS> 97247469
0
0
<COMMON> 29792573
<OTHER-SE> (2825235)
<TOTAL-LIABILITY-AND-EQUITY> 127206596
<SALES> 0
<TOTAL-REVENUES> 7449377
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3695035
<LOSS-PROVISION> 1233503
<INTEREST-EXPENSE> 2148430
<INCOME-PRETAX> 372409
<INCOME-TAX> 148964
<INCOME-CONTINUING> 223445
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 223445
<EPS-PRIMARY> .04
<EPS-DILUTED> .04
</TABLE>
