Illinois-Bensenville-870 Thomas Drive Lease - SSMRT Bensenville Industrial Park (3) Inc. and Burke Industries Inc.
COMMERCIAL
LEASE AGREEMENT
SSMRT BENSENVILLE INDUSTRIAL PARK (3), INC.
Landlord
AND
BURKE INDUSTRIES, INC.
Tenant
<PAGE>
STANDARD INDUSTRIAL LEASE AGREEMENT BIP #14
COMMERCIAL 93 579 THOMAS DRIVE
NET ESCROW BENSENVILLE, IL 60106
TRAMMELL CROW COMPANY DATE DRAFTED: MAY 1, 1996
LEASE AGREEMENT
THIS LEASE AGREEMENT, made and entered into by and between, SSMRT Bensenville
Industrial Park (3), Inc. or its assigns, hereinafter referred to as
"Landlord", and Burke Industries, Inc. hereinafter referred to as "Tenant";
WITNESSETH:
1. PREMISES AND TERM. In consideration of the mutual obligations of
Landlord and Tenant set forth herein, Landlord leases to Tenant, and Tenant
hereby takes from Landlord the Premises situated within the County of DUPAGE,
State of ILLINOIS, more particularly described on EXHIBIT "A", commonly known
as 870 THOMAS DRIVE, BENSENVILLE, ILLINOIS and outlined in red attached
hereto and incorporated herein by reference, (the "Premises"), to have and to
hold, subject to the terms, covenants and conditions in this Lease. The term
of this Lease shall commence on the commencement date hereinafter set forth
and shall end on the last day of the month that is 37 months after the
commencement date.
A. EXISTING BUILDING. If no improvements are to be constructed to the
Premises, the commencement date shall be ON OR ABOUT JUNE 1, 1996 BUT WILL BE
NO LATER THAN JUNE 15, 1996. Tenant acknowledges that (i) it has inspected
and accepts the Premises, (ii) the buildings and improvements comprising the
same are suitable for the purpose for which the Premises are leased, (iii)
the Premises are in good and satisfactory condition, and (iv) no
representations as to the repair of the Premises, nor promises to alter,
remodel or improve the Premises have been made by Landlord (unless otherwise
expressly set forth in this Lease). If this lease is executed before the
Premises become vacant or otherwise available and ready for occupancy, or if
any present Tenant or occupant of the Premises holds over, and Landlord
cannot, using good faith efforts, acquire possession of the Premises prior to
the date above recited as the commencement date of this lease, Landlord shall
not be deemed to be in default hereunder nor in any way liable to Tenant
because of such failure, and Tenant agrees to accept possession of the
Premises at such time as Landlord is able to tender the same, which date
shall thenceforth be deemed to be the "commencement date"; and the term of
this lease automatically shall be extended so as to include the full number
of months hereinbefore provided for, except that if the commencement date is
other than the first day of a calendar month such term also shall be extended
for the remainder of the calendar month in which possession is tendered.
Landlord hereby waives payment of rent covering any period prior to such
tendering of possession. After the commencement date, Tenant shall, upon
demand, execute and deliver to Landlord a letter of acceptance of delivery of
the Premises. LANDLORD SHALL MAKE THE TENANT IMPROVEMENTS OUTLINED IN EXHIBIT
"A".
2. BASE RENT, SECURITY DEPOSIT AND ESCROW PAYMENTS.
A. Tenant agrees to pay to Landlord rent for the Premises, in advance,
without demand, deduction or set off, at the rate of SIX THOUSAND NINE
HUNDRED EIGHTY ONE AND 85/100 Dollars ($6,981.85) per month during the term
hereof. One such monthly installment, plus the other monthly charges set
forth in Paragraph 2C below shall be due and payable on the date hereof and a
like monthly installment shall be due and payable on or before the first day
of each calendar month succeeding the commencement date, except that all
payments due hereunder for any fractional calendar month shall be prorated.
TENANT WILL RECEIVE THE FIRST MONTH RENT FREE.
B. In addition, Tenant agrees to deposit with Landlord on the date hereof
the sum of EIGHT THOUSAND ONE HUNDRED FORTY ONE AND 15/100 Dollars
($8,141.l5) which shall be held by Landlord, without obligation for interest,
as security for the performance of Tenant's obligations under this lease, it
being expressly understood and agreed that this deposit is not an advance
rental deposit or a measure of Landlord's damages in case of Tenant's
default. Upon each occurrence of an event of default, Landlord may use all or
part of the deposit to pay past due rent or other payments due Landlord under
this Lease, and the cost of any other damage, injury, expense or liability
caused by such event of default without prejudice to any other remedy
provided herein or provided by law. On demand, Tenant shall pay Landlord the
amount that will restore the security deposit to its original amount. The
security deposit shall be deemed the property of Landlord, but any remaining
balance of such deposit shall be returned by Landlord to Tenant when Tenant's
obligations under this Lease have been fulfilled. LANDLORD WILL RETURN TO
TENANT SECURITY DEPOSIT WITHIN 30 DAYS AFTER THE FINAL RECONCILIATION.
C. Tenant agrees to pay its proportionate share (as defined in Paragraph 22K
below) of (i) Taxes (hereinafter defined) payable by Landlord pursuant to
paragraph 3A below, (ii) the cost of utilities payable pursuant to paragraph
8 below, (iii) the cost of administering and maintaining any insurance
pursuant to paragraph 9 below and (iv) the cost of any common area charges
payable by Tenant in accordance with paragraph 4C. below. During each month
of the term of this Lease, on the same day that rent is due hereunder, Tenant
shall escrow with Landlord an amount equal to 1/12 of the estimated annual
cost of its proportionate share of such items. Tenant authorizes Landlord to
use the funds deposited with Landlord under this Paragraph 2C to pay such
costs. The initial monthly escrow payments are based upon the estimated
amounts for the year in question, and shall be increased or decreased
annually to reflect the projected actual cost of all such items. If the
Tenant's total escrow payments are less than Tenant's actual proportionate
share of all such items, Tenant shall pay the difference to Landlord within
ten (10) days after demand. If the total escrow payments of Tenant are more
than Tenant's actual proportionate share of all such items, Landlord shall
retain such excess and credit it against Tenant's next annual escrow
payments. IF THERE IS AN INCREASE IN ESCROW COSTS TENANT WILL HAVE THE RIGHT
TO REVIEW THE ESCROW CHARGES WITH LANDLORD. The amount of the monthly rental
and the initial monthly escrow payments are as follows:
Page 1
<PAGE>
(1) Base Rent as set forth in Paragraph 2A. . . . . . . . . . . .$6,981.85
(2) Tax Escrow Payment. . . . . . . . . . . . . . . . . . . . . .$859.71
(3) Insurance Escrow Payment. . . . . . . . . . . . . . . . . . .$78.16
(4) Utility Charge. . . . . . . . . . . . . . . . . . . . . . . .$N/A
(5) Common Area Charge. . . . . . . . . . . . . . . . . . . . . .$221.44
(6) Other . . . . . . . . . . . . . . . . . . . . . . . . . . . .$N/A
Monthly Payment Total. . . . . . . . . . . . . . . . . . . . .$8,141.16
3. TAXES.
A. Landlord agrees to pay all taxes, assessments and governmental charges of
any kind and nature (collectively referred to herein as "Taxes") that accrue
against the Premises, and/or the land and/or improvements of which the
Premises are a part. If at any time during the term of this Lease, there
shall be levied, assessed or imposed on Landlord a capital levy or other tax
directly on the rents received therefrom and/or a franchise tax assessment,
levy or charge measured by or based, in whole or in part, upon such rents
from the Premises and/or the land and improvements of which the Premises are
a part, then all such taxes, assessments, levies or charges, or the part,
thereof so measured or based, shall be deemed to be included within the term
"Taxes" for the purposes hereof. The Landlord shall have the right to employ
a tax consulting firm to attempt to assure a fair tax burden on the building
and grounds within the applicable taxing jurisdiction. Tenant agrees to pay
its proportionate share of the cost of such consultant.
B. Tenant shall be liable for all taxes levied or assessed against any
personal property or fixtures placed in the Premises. If any such taxes are
levied or assessed against Landlord or Landlord's property and (i) Landlord
pays the same or (ii) the assessed value of Landlord's property is increased
by inclusion of such personal property and fixtures and Landlord pays the
increased taxes, then, upon demand Tenant shall pay to Landlord such taxes.
4. LANDLORD'S REPAIRS.
A. Landlord, at its own cost and expense, shall maintain the roof,
foundation and the structural soundness of the exterior walls of the building
of which the Premises are a part in good repair, reasonable wear and tear
excluded. The term "walls" as used herein shall not include windows, glass or
plate glass, doors, special store fronts or office entries. Tenant shall
immediately give Landlord written notice of defect or need for repairs, after
which Landlord shall have reasonable opportunity to repair same or cure such
defects.
B. Landlord reserves the right to perform the paving, floor slab, common
area, and landscape replacement and maintenance, exterior painting, common
sewage line plumbing and any other items that are otherwise Tenant's
obligations under Paragraph 5A, in which event, Tenant shall be liable for
its proportionate share of the cost and expense of such repair, replacement,
maintenance and other such items (which cost shall include any administration
and supervision fees incurred by Landlord in connection therewith equal to
fifteen percent (15%) of the cost thereof unless a repair is necessitated by
damage caused by the act or neglect of Tenant, its agents, employees,
invitees, licensees or contractors, in which event Tenant shall bear one
hundred percent (100%) of such cost which cost shall include an
administration and supervision fee of fifteen percent 15%) of the cost
thereof). The cost that the Tenant may be charged is the cost of performing
such service for this building on a stand alone basis.
C. Tenant agrees to pay its proportionate share of the cost (i) maintenance
and/or landscaping of any property that is a part of the building and/or
project of which the Premises are a part, (ii) maintenance and/or landscaping
of any property that is maintained or landscaped by any property owner or
community owner association that is named in the restrictive covenants or
deed restrictions to which the Premises are subject, and (iii) operating and
maintaining any property, facilities or services provided for the common use
of Tenant and other lessees of any project or building of which the Premises
are a part.
D. Landlord, at Tenant's cost and expense, shall enter into a regularly
scheduled preventive maintenance/service contract with a maintenance
contractor for servicing all hot water, heating and air conditioning systems
and equipment within the Premises. The service contract will include all
services suggested by the equipment manufacturer in its
operations/maintenance manual and an executed copy of such contract will be
provided to Tenant.
5. TENANT'S REPAIRS.
A. Tenant, at its own cost and expense, shall (i) maintain all parts and
floor slab of the Premises, landscape and grounds surrounding the Premises
(except those for which Landlord is expressly responsible hereunder) in good
condition, (ii) promptly make all necessary repairs and replacements, (iii)
keep the parking areas sidewalks, driveways and alleys surrounding the
Premises in a clean and sanitary condition and shall remove all rubbish, snow
and ice from same, and
B. Tenant, at its own cost and expense, shall property maintain the surface
of the floor slab, and shall use equipment and fixtures which avoid damage to
the floor slab. In addition, Tenant agrees not to overload the floor slabs in
any way so as to cause damage to the slab or the foundation.
6. ALTERATIONS. Tenant shall not make any alterations, additions or
improvements to the Premises without the prior written consent of Landlord.
Tenant, at its own cost and expense, may erect such shelves, bins machinery
and trade fixtures as it desires provided that (a)
Page 2
<PAGE>
such items do not alter the basic character of the Premises or the building
and/or improvements of which the Premises are a part, (b) such items do not
overload or damage the same, (c) such items may be removed without injury to
the Premises; and (d) the construction, erection or installation thereof
complies with all applicable governmental laws, ordinances, regulations and
with Landlord's specifications and requirements. All alterations, additions,
improvements and partitions erected by Tenant shall be and remain the
property of Tenant during the term of this Lease. All shelves, bins,
machinery and trade fixtures installed by Tenant shall be removed on or
before the earlier to occur of the date of termination of this Lease or
vacating the Premises, at which time Tenant shall restore the Premises to
their original condition, REASONABLE WEAR AND TEAR ACCEPTED. All alterations,
installations, removals and restoration shall be performed in a good and
workmanlike manner so as not to damage or alter the primary structure or
structural qualities of the buildings and other improvements situated on the
Premises or of which the Premises are a part.
7. SIGNS. Tenant shall not install any signs upon the Premises without the
prior written consent of Landlord. Any signs shall be removed at Tenant's
cost upon termination or expiration of this Lease. Tenant shall repair,
paint, and/or replace the building facia surface to which its signs are
attached upon vacation of the Premises, or the removal or alteration of its
signage. Tenant shall not, (i) make any changes to the exterior of the
Premises, (ii) install any exterior lights, decorations, balloons, flags,
pennants, banners or painting, or (iii) erect or install any signs, windows
or door lettering, placards, decorations or advertising media of any type
which can be viewed from the exterior of the Premises, without Landlord's
prior written consent. All signs, decorations, advertising media, blinds,
draperies and other window treatment or bars or other security installations
visible from outside the Premises shall conform in all respects to the
criteria established by Landlord.
8. UTILITIES. Landlord agrees to provide normal water service to the
Premises. Tenant shall pay for all water, gas, heat, light, power, telephone,
sewer, sprinkler charges and other utilities and services used on or at the
Premises, together with any taxes, penalties, surcharges or the like
pertaining to the Tenant's use of the Premises, and any maintenance charges
for utilities. Landlord shall have the right to cause any of said services to
be separately metered to Tenant, at Tenant's expense. Tenant shall pay its
pro rata share, as reasonably determined by Landlord, of all charges for
jointly metered utilities. Landlord shall not be liable for any interruption
or failure of utility service on the Premises.
9. INSURANCE.
A. Landlord shall maintain insurance covering the buildings situated on the
Premises or of which the Premises are a part in an amount not less than
eighty percent (80%) of the "replacement cost" thereof insuring against the
perils of Fire, Lightning, Extended Coverage Vandalism and Malicious
Mischief, Liability and Rental Interruption and such other insurance as
Landlord shall deem necessary.
B. Tenant, at its own expense, shall maintain during the term of this Lease
a policy or policies of worker's compensation and comprehensive general
liability insurance, including personal injury and property damage, with
contractual liability endorsement, in the amount of Five Hundred Thousand
Dollars ($500,000.00) for property damage and Two Million Dollars
($2,000,000) per occurrence for personal injuries or deaths of persons
occurring in or about the Premises. Tenant, at its own expense, also shall
maintain during the term of this Lease, fire and extended coverage insurance
covering the replacement cost of (i) all alterations, additions, partitions
and improvements installed or placed on the Premises by Tenant or by Landlord
on behalf of Tenant and (ii) all of Tenant's personal property contained
within the Premises. Said policies shall (i) name Landlord as an additional
insured (except for the worker's compensation policy, which instead shall
include waiver of subrogation endorsement in favor of Landlord), (ii) be
issued by an insurance company which is acceptable to Landlord, and (iii)
provide that said insurance shall not be canceled unless thirty (30) days
prior written notice shall have been given to Landlord. Said policies shall
provide primary coverage to Landlord; when any policy issued to Landlord is
similar or duplicate in coverage, Landlord's policy shall be excess over
Tenant's policies. Said policy or policies, or certificates thereof, shall be
delivered to Landlord by Tenant upon commencement of the term of the Lease
and upon each renewal of said insurance.
C. Tenant will not permit the Premises to be used for any purpose or in any
manner that would (i) void the insurance thereon (ii) increase the insurance
risk, or (iii) cause the disallowance of any sprinkler credits, including
without limitation, use of the Premises for the receipt, storage or handling
of any product, material or merchandise that is explosive or highly
inflammable. If any increase in the cost of any insurance on the Premises or
the building of which the Premises are a part is caused by Tenant's use of
the Premises, or because Tenant vacates the Premises FOR A PERIOD SIX MONTHS,
then Tenant shall pay the amount of such increase to Landlord.
10. FIRE AND CASUALTY DAMAGE.
A. If the Premises or the building of which the Premises are a part should
be damaged or destroyed by fire or other peril, Tenant immediately shall give
written notice to Landlord. If the buildings situated upon the Premises or of
which the Premises are a part should be totally destroyed by any peril
covered by the insurance to be provided by Landlord under Paragraph 9A above,
or if they should be so damaged thereby that, in Landlord's estimation,
rebuilding or repairs cannot be completed within one hundred eighty (180)
days after the date of such damage, this Lease shall terminate and the rent
shall be abated during the unexpired portion of this Lease effective upon the
date of the occurrence of such damage.
B. If the buildings situated upon the Premises or of which the Premises are
a part, should be damaged by any peril covered by the insurance to be
provided by Landlord under Paragraph 9A above, and in Landlord's estimation,
rebuilding or repairs can be substantially completed within one hundred
eighty (180) days after the date of such damage, this Lease shall not
terminate, and Landlord shall restore the Premises to substantially its
previous condition, except that Landlord shall not be required to rebuild,
repair or replace any part of the partitions, fixtures, additions and other
improvements that may have been constructed, erected or installed in, or
about the Premises or for the benefit of, or by or for Tenant. If such
repairs and rebuilding have not been substantially completed within one
hundred eighty (180) days after the date of such damage (subject to delays
outside of Landlord's control DURING THE FIRST TWELVE MONTHS OF THE TERM
HEREOF), Tenant, as Tenant's exclusive remedy, may terminate this Lease by
delivering written notice of termination to Landlord in which event the
rights and obligations hereunder shall cease and terminate. In the event of
any insurance claim, Tenant shall be liable for payment of any deductible
WHICH IS EQUAL TO TEN THOUSAND AND 00/100 DOLLARS $10,000.00), under any of
Landlord's insurance policies with respect to the premises.
C. Notwithstanding anything herein to the contrary, in the event the holder
of any indebtedness secured by a mortgage or deed of trust covering the
Premises requires that the insurance proceeds be applied to such
indebtedness, then Landlord shall have the right to terminate this Lease by
delivering written notice of termination to Tenant within fifteen (15) days
after such requirement is made known by any such holder, whereupon all rights
and obligations hereunder shall cease and terminate. LANDLORD WILL NOTIFY
TENANT OF INTENT TO REBUILD OR REPAIR PREMISES WITHIN FORTY-FIVE (45) DAYS OF
SUCH DAMAGE.
D. Anything in this Lease to the contrary notwithstanding, Landlord and
Tenant hereby waive and release each other of and from any and all rights of
recovery, claim, action or cause of action, against each other, their agents,
officers and employees, for any loss or damage
Page 3
<PAGE>
that may occur to the Premises, improvements to the building of which the
Premises are a part, or personal property (building contents) within the
building and/or Premises, for any reason regardless of cause or origin. Each
party to this Lease agrees immediately after execution of this Lease to give
each insurance company, which has issued to it policies of fire and extended
coverage insurance, written notice of the terms of the mutual waivers
contained in this subparagraph, and if necessary, to have the insurance
policies properly endorsed.
E. If the Premises are damaged by any peril not covered by the insurance to
be provided by Landlord under paragraph 9A above and the cost to repair such
damage exceeds any amount Tenant may elect to contribute, Landlord may elect
either to commence to repair and restore the Premises, in which event this
Lease shall remain in full force and effect, or not to repair and restore the
Premises, in which event this Lease shall terminate.
11. LIABILITY AND INDEMNIFICATION. Tenant shall hold Landlord AND LANDLORD
SHALL HOLD TENANT harmless from and defend against any and all claims or
liability for any injury or damages (i) to any person or property whatsoever
occurring in, on or about the Premises or any part thereof and/or of the
building of which the Premises are a part, including without limitation
elevators, stairways, passageways or hallways, the use of which Tenant may
have in accordance with this Lease, when such injury or damage shall be
caused by the act neglect, fault of, or omission of any duty with respect to
the same by their agents, servants, employees, or invitees (ii) arising from
the conduct of management of any work done by LANDLORD OR TENANT in or about
the Premises, (iii) arising from transactions of the Tenant, and (iv) all
REASONABLE costs, counsel fees, expenses and liabilities incurred in
connection with any such claim or action or proceeding brought thereon. The
provisions of this Paragraph 11 shall survive the expiration or termination
of this Lease with respect to any claims or liability occurring prior to such
expiration or termination.
12. USE. The Premises shall be used only for the purpose of receiving,
storing, shipping and selling (other than retail) products, materials and
merchandise made and/or distributed by Tenant and for such other lawful
purposes as may be incidental thereto. Outside storage, including without
limitation, storage of trucks and other vehicles, is prohibited without
Landlord's prior written consent. Tenant shall have the non-exclusive right
to use, in common with other Tenants of the building of which the Premises
are a part, the parking provided and designated as such by Landlord. Tenant
shall comply with all governmental laws, ordinances and regulations
applicable to the use of the Premises, and promptly shall comply with all
governmental orders and directives for the correction, prevention and
abatement of nuisances in or upon, or connected with, the Premises, all at
Tenant's sole expense. Tenant shall not permit any objectionable or
unpleasant odors, smoke, dust, gas, noise or vibrations to emanate from the
Premises, nor take any other action that would constitute a nuisance or would
disturb, unreasonably interfere with, or endanger Landlord or any other
lessees of the building in which the Premises are a part. Tenant shall pay
the cost of any modifications to the Premises, the building in which the
Premises are located and the common areas required as a result of Tenant's
particular use of the Premises.
13. INSPECTION. Landlord and Landlord's agents and representatives shall
have the right to enter the Premises at any reasonable time during business
hours, to inspect the Premises and to make such repairs as may be required or
permitted pursuant to this Lease. During the period that is six (6) months
prior to the end of the Lease term, upon telephonic notice to Tenant,
Landlord and Landlord's representatives may enter the Premises during
business hours for the purpose of showing the Premises. In addition, Landlord
shall have the right to erect a suitable sign on the Premises stating the
Premises are available. Tenant shall notify Landlord in writing at least
thirty (30) days prior to vacating the Premises and shall arrange to meet
with Landlord for a joint inspection of the Premises prior to vacating. If
Tenant fails to give such notice or to arrange for such inspection, then
Landlord's inspection of the Premises shall be deemed correct for the purpose
of determining Tenant's responsibility for repairs and restoration of the
Premises.
14. ASSIGNMENT AND SUBLETTING.
A. Tenant shall not have the right to assign, sublet, transfer or encumber
this Lease, or any interest therein without the prior written consent of
Landlord. Any attempted assignment, subletting, transfer or encumbrance by
Tenant in violation of the terms and covenants of this Paragraph shall be
void. In the event Tenant desires to sublet the Premises, or any portion
thereof, or assign this Lease, Tenant shall give written notice thereof to
Landlord within a reasonable time prior to the proposed commencement date of
such subletting or assignment which notice shall set forth the name of the
proposed sublessee or assignee, the relevant terms of any sublease and copies
of financial reports and other relevant financial information of the proposed
sublessee or assignee. LANDLORD CONSENT SHALL NOT BE UNREASONABLY WITHHELD
AND LANDLORD SHALL GRANT OR DENY CONSENT WITHIN 14 BUSINESS DAYS OF RECEIVING
CONSENT TO SUBLEASE NOTICE.
C. If this Lease is assigned to any person or entity pursuant to the
provisions of the Bankruptcy Code, 11 U.S.C. Section 101 et. seq., (the
Bankruptcy Code"), any and all monies or other consideration payable or
otherwise to be delivered in connection with such assignment shall be paid or
delivered to Landlord, shall be and remain the exclusive property of Landlord
and shall not constitute property of Tenant or of the estate of Tenant within
the meaning of the Bankruptcy Code. Any and all monies or other
considerations constituting Landlord's property under the preceding sentence
not paid or delivered to Landlord shall be held in trust for the benefit of
Landlord and be promptly paid or delivered to Landlord. Any person or entity
to which this Lease is assigned pursuant to the provisions of the Bankruptcy
Code, shall be deemed, without further act or deed to have assumed all of the
obligations arising under this I case on and after the date of such
Page 4
<PAGE>
interest in this Lease (all such assignees, sublessees and transferees being
hereinafter referred to as "Transferees"), by assuming Tenant's obligations
hereunder, shall assume liability to Landlord for all amounts paid to persons
other than Landlord by such Transferees in contravention of this Paragraph.
No assignment, subletting or other transfer, whether consented to by Landlord
or not or permitted hereunder shall relieve Tenant of its liability
hereunder. If an event of default occurs while the Premises or any part
thereof are assigned or sublet, then Landlord, in addition to any other
remedies herein provided, or provided by law, may collect directly from such
Transferee all rents payable to the Tenant and apply such rent against any
sums due Landlord hereunder. No such collection shall be construed to
constitute a novation or a release of Tenant from the further performance of
Tenant's obligations hereunder.
15. CONDEMNATION. If the Premises are taken for any public or quasi-public
use under governmental law, ordinance or regulation, or by right of eminent
domain, or by private purchase in lieu thereof and the taking prevents or
materially interferes with the use of the Premises for the purpose for which
they were leased to Tenant, this Lease shall terminate and the rent shall be
abated during the unexpired portion of this Lease, effective on the date of
such taking. If less than eighty percent (80%) of the Premises are taken for
any public or quasi-public use under any governmental law, ordinance or
regulation, or by right of eminent domain, or by private purchase in lieu
thereof, this Lease shall not terminate, but the rent payable hereunder
during the unexpired portion of this Lease shall be reduced to such extent as
may be fair and reasonable under all of the circumstances. All compensation
awarded in connection with or as a result of any of the foregoing proceedings
shall be the property of Landlord and Tenant hereby assigns any interest in
any such award to Landlord; provided, however, Landlord shall have no
interest in any award made to Tenant for the taking of Tenant's fixtures and
improvements, if a separate award for such items is made to Tenant.
16. HOLDING OVER. At the termination of this Lease by its expiration or
otherwise, Tenant immediately shall deliver possession to Landlord with all
repairs and maintenance required herein to be performed by Tenant completed.
If, for any reason, Tenant retains possession of the Premises or any part
thereof after such termination, then Landlord may, at its option, serve
written notice upon Tenant that such holding over constitutes either, (ii)
creation of a month to month tenancy, upon the terms and conditions set forth
in this lease, or (iii) creation of a tenancy at sufferance, in any case upon
the terms and conditions set forth in this lease; provided, however, that the
monthly rental or daily rental under (iii) shall, in addition to all other
sums which are to be paid by Tenant hereunder whether or not as additional
rent, be equal to ONE HUNDRED FIFTY PERCENT (l50%) OF the rental being paid
monthly to Landlord under this lease immediately prior to such termination
(prorated in the case of (iii) on the basis of a 365 day year for each day
Tenant remains in possession). If no such notice is served then a tenancy at
sufferance shall be deemed to be created at the rent in the preceding
sentence. Tenant shall also pay to Landlord all damages sustained by Landlord
resulting from retention of possession by Tenant, including the loss of any
proposed subsequent tenant for any portion of the Premises. The provisions of
this Paragraph shall not constitute a waiver by Landlord of any right of
re-entry as herein set forth; nor shall receipt of any rent or any other act
in apparent affirmance of the tenancy operate as a waiver of the right to
terminate this Lease for a breach of any of the terms, covenants, or
obligations herein on Tenant's part to be performed. No holding over by
Tenant, whether with or without consent of Landlord shall operate to extend
this Lease except as otherwise expressly provided. The preceding provisions
of this Paragraph 16 shall not be construed as consent for Tenant to retain
possession of the Premises in the absence of written consent thereto by
Landlord.
17. QUIET ENJOYMENT. Landlord covenants that on or before the commencement
date it will have good title to the Premises, free and clear of all liens and
encumbrances, excepting only the lien for current taxes not yet due, such
mortgage or mortgages as are permitted by the terms of this Lease, zoning
ordinances and other building and fire ordinances and governmental
regulations relating to the use of such property, and easements restrictions
and other conditions of record. If this Lease is a sublease then Tenant
agrees to take the Premises subject to the provisions of the prior Leases.
Landlord represents that it has the authority to enter into this Lease and
that so long as Tenant pays all amounts due hereunder and performs all other
covenants and agreements herein set forth, Tenant shall peaceably and quietly
have, hold and enjoy the Premises for the term hereof without hindrance or
molestation from Landlord, subject to the terms and provisions of this Lease.
18. EVENTS OF DEFAULT. The following events (herein individually referred to
as "event of default") each shall be deemed to be events of nonperformance by
Tenant under this Lease:
A. Tenant shall fail to pay any installment of the rent herein reserved when
due, or any other payment or reimbursement to Landlord required herein when
due, and such failure shall continue for a period of five (5) days from the
date such payment was due. TENANT WILL BE ALLOWED TO BE LATE WITH RENTAL
PAYMENT TWICE DURING THE LEASE TERM, AND NOT BE CONSIDERED IN DEFAULT.
B. The Tenant or any guarantor of the Tenant's obligations hereunder shall
(i) become insolvent BECAUSE TENANT IS UNABLE TO PAY ITS DEBTS AS THEY COME
DUE, (ii) admit in writing its inability to pay its debts; (iii) make a
general assignment for the benefit of creditors, (iv) commence any case,
proceeding or other action seeking to have an order for relief entered on its
behalf as a debtor or to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, liquidation, dissolution or
composition of it or its debts under any law relating to bankruptcy,
insolvency, reorganization or relief of debtors or seeking appointment of a
receiver, trustee, custodian or other similar official for it or for all or
of any substantial part of its property, or (v) take any action to authorize
or in contemplation of any of the actions set forth above in this Paragraph.
C. Any case, proceeding or other action against the Tenant or any guarantor
of the Tenant's obligations hereunder shall be commenced seeking (i) to have
an order for relief entered against it as debtor or to adjudicate it a
bankrupt or insolvent; (ii) reorganization, arrangement, adjustment,
liquidation, dissolution or composition of it or its debts under any law
relating to bankruptcy, insolvency, reorganization or relief of debtors;
(iii) appointment of a receiver, trustee, custodian or other similar official
for it or for all or any substantial part of its property, and such case,
proceeding or other action (a) results in the entry of an order for relief
against it which it is not fully stayed within seven (7) business days after
the entry thereof or (b) shall remain undismissed for a period of forty-five
(45) days.
D. Tenant shall (i) vacate all or a substantial portion of the Premises AND
FAIL TO PAY RENT AS REQUIRED HEREIN or (ii) fail to continuously operate its
business at the Premises for the permitted use set forth herein, whether or
not Tenant is in default of the rental payments due under this Lease.
E. Tenant shall fail to discharge any lien placed upon the Premises in
violation of Paragraph 21 hereof within twenty (20) days after any such lien
or encumbrance is filed against the Premises.
F. Tenant shall fail to comply with any term, provision or covenant of this
Lease (other than those listed in this Paragraph 18), and shall not cure such
failure within twenty (20) days after written notice thereof to Tenant.
Page 5
<PAGE>
19. REMEDIES.
A. Upon each occurrence of an event of default, Landlord shall have the
option to pursue any one or more of the following remedies without any notice
or demand:
(1) Terminate this Lease; and/or
(2) Enter upon and take possession of the Premises without terminating
this Lease; and/or
(3) Alter all locks and other security devices at the Premises with or
without terminating this Lease, and pursue, at Landlord's option, one or more
remedies pursuant to this Lease; and in any such event Tenant immediately
shall surrender the Premises to Landlord, and if Tenant fails so to do
Landlord, without waiving any other remedy it may have, may enter upon and
take possession of the Premises and expel or remove Tenant and any other
person who may be occupying such Premises or any part thereof,
(4) Maintain Tenant's right to possession in which case this Lease shall
continue in effect whether or not Tenant shall have abandoned the Premises.
In such event Landlord shall be entitled to enforce all of Landlord's rights
and remedies under this Lease, including the right to recover rent as it
becomes due.
B. If Landlord terminates this Lease, at Landlord's option, Tenant shall be
liable for and shall pay to Landlord, the sum of all rental and other
payments owed to Landlord hereunder accrued to the date of such termination,
plus, as liquidated damages, an amount equal to (1) the present value of the
total rental and other payments owed hereunder for the remaining portion of
the Lease term, calculated as if such term expired on the date set forth in
Paragraph 1, less (2) the then present fair market rental value of the
Premises for such period, which because of the difficulty of ascertaining
such value, Landlord and Tenant stipulate and agree, shall in no event be
deemed to exceed seventy-five percent (75%) of the rental amount set forth in
Paragraph 2 above.
C. If Landlord repossesses the Premises without terminating the Lease,
Tenant, at Landlord's option, shall be liable for and shall pay Landlord on
demand all rental and other payments owed to Landlord hereunder, accrued to
the date of such repossession, plus all amounts required to be paid by Tenant
to Landlord until the date of expiration of the term as stated in Paragraph
1, diminished by all amounts received by Landlord through reletting the
Premises during such remaining term (but only to the extent of the rent
herein reserved). Actions to collect amounts due by Tenant to Landlord under
this Subparagraph may be brought from time to time, on one or more occasions,
without the necessity of Landlord's waiting until expiration of the Lease
term.
D. Upon an event of default, in addition to any sum provided to be paid
herein, Tenant also shall be liable for and shall pay to Landlord (i)
brokers' fees incurred by Landlord in connection with reletting the whole or
any part of the Premises ATTRIBUTABLE TO THE BALANCE OF THE TERM HEREOF; (ii)
the costs of removing and storing Tenant's or other occupant's property;
(iii) the costs of repairing, altering, remodeling or otherwise putting the
Premises into condition acceptable to a new tenant or tenants EQUAL TO AN
AMOUNT NOT TO EXCEED THE UNAMORITZED PORTION OF THE COST OF THE IMPROVEMENTS
MADE BY LANDLORD TO THE PREMISES FOR TENANTS OCCUPANCY and (iv) all
reasonable expenses incurred in marketing the Premises and (v) all reasonable
expenses incurred by Landlord in enforcing or defending Landlord's rights
and/or remedies. If either party hereto institute any action or proceeding to
enforce any provision hereof by reason of any alleged breach of any provision
of this Lease, the prevailing party shall be entitled to receive from the
losing party all reasonable attorneys' fees and all court costs in connection
with such proceeding.
E. In the event Tenant fails to make any payment due hereunder when payment
is due, to help defray the additional cost to Landlord for processing such
late payments, Tenant shall pay to Landlord on demand a late charge in an
amount equal to five percent (5%) of such installment; and the failure to pay
such amount within ten (10) days after demand therefor shall be an additional
event of default hereunder. The provision for such late charge shall be in
addition to all of Landlord's other rights and remedies hereunder or at law
and shall not be construed as liquidated damages or as limiting Landlord's
remedies in any manner.
F. Exercise by Landlord of any one or more remedies hereunder granted or
otherwise available shall not be deemed to be an acceptance of surrender of
the Premises by Landlord, whether by agreement or by operation of law, it
being understood that such surrender can be effected only by the written
agreement of Landlord and Tenant. Tenant and Landlord further agree that
forbearance by Landlord to enforce its rights pursuant to the Lease at law or
in equity, shall not be a waiver of Landlord's right to enforce one or more
of its rights in connection with any subsequent default.
G. In the event of termination and/or repossession of the Premises for an
event of default, Landlord shall use reasonable efforts to relet the Premises
and to collect rental after reletting, provided, that, Tenant shall not be
entitled to credit or reimbursement of any proceeds in excess of the rental
owed hereunder. Landlord may relet the whole or any portion of the Premises
for any period, to any Tenant and for any use and purpose.
H. If Landlord fails to perform any of its obligations hereunder within
thirty (30) days after written notice from Tenant specifying such failure,
Tenant's exclusive remedy shall be an action for damages. Notwithstanding the
foregoing, if the nature of Landlord's obligation is such that more than
thirty (30) days is reasonably required to cure such failure, then Landlord
shall have such time as is reasonably required provided Landlord commences
such performance within thirty (30) days after written notice from Tenant and
thereafter diligently prosecutes the same to completion. Unless and until
Landlord fails to so cure any default after such notice, Tenant shall not
have any remedy or cause of action by reason thereof. All obligations of
Landlord hereunder will be construed as covenants, not conditions; and all
such obligations will be binding upon Landlord only during the period of its
possession of the Premises and not thereafter. The term "Landlord" shall mean
only the owner, for the time being of the Premises, and in the event of the
transfer by such owner of its interest in the Premises, such owner shall
thereupon be released and discharged from all covenants and obligations of
the Landlord thereafter accruing, but such covenants and obligations shall be
binding during: the Lease term upon each new owner for the duration of such
owner's ownership. Notwithstanding any other provision hereof, Landlord shall
not have any personal liability hereunder. In the event of any breach or
default by Landlord in any term or provision of this Lease, Tenant agrees to
look solely to the equity or interest then owned by Landlord in the Premises
or of the building of which the Premises are a part; however, in no event,
shall any deficiency judgment or any money judgment of any kind be sought or
obtained against any Landlord.
I. If Landlord repossesses the Premises pursuant to the authority herein
granted, then Landlord shall have the right to (i) keep in place and use or
(ii) remove and store all of the furniture, fixtures and equipment at the
Premises including that which is owned by or leased to Tenant at all times
prior to any foreclosure thereon by Landlord or repossession thereof by any
Landlord thereof or third party having a lien thereon. Landlord also shall
have the right to relinquish possession of all or any portion of such
furniture, fixtures, equipment and
Page 6
<PAGE>
said instrument. The rights of Landlord herein stated shall be in addition to
any and all other rights that Landlord has or may hereafter have at law or in
equity; and Tenant stipulates and agrees that the rights herein granted
Landlord are commercially reasonable.
J. Notwithstanding anything in this Lease to the contrary, all amounts
payable by Tenant to or on behalf of Landlord under this Lease, whether or
not expressly denominated as rent, shall constitute rent.
K. This is a contract under which applicable law excuses Landlord from
accepting performance from (or rendering performance to) any person or entity
other than Tenant.
20. MORTGAGES. Tenant accepts this Lease subject and subordinate to any
mortgages and/or deeds of trust now or at any time hereafter constituting a
lien or charge upon the Premises or the improvements situated thereon or the
building of which the Premises are a part, provided, however, that if the
mortgagee, trustee, or holder of any such mortgage or deed of trust elects to
have Tenant's interest in this Lease superior to any such instrument, then by
notice to Tenant from such mortgagee, trustee or holder, this Lease shall be
deemed superior to such lien, whether this Lease was executed before or after
said mortgage or deed of trust. Tenant, at any time hereafter on demand,
shall execute any instruments, releases or other documents that may be
required by any mortgagee for the purpose of subjecting and subordinating
this Lease to the lien of any such mortgage.
21. MECHANIC'S LIENS. Tenant has no authority, express or implied, to create
or place any lien or encumbrance of any kind or nature whatsoever upon, or in
any manner to bind the interest of Landlord or Tenant in the Premises or to
charge the rentals payable hereunder for any claim in favor of any person
dealing with Tenant, including those who may furnish materials or perform
labor for any construction or repairs. Tenant covenants and agrees that it
will pay or cause to be paid all sums legally due and payable by it on
account of any labor performed or materials furnished in connection with any
work performed on the Premises ON TENANT'S BEHALF and that it will save and
hold Landlord harmless from any and all loss, cost or expense based on or
arising out of asserted claims or liens against the leasehold estate or
against the right, title and interest of the Landlord in the Premises or
under the terms of this Lease. Tenant agrees to give Landlord immediate
written notice of the placing of any lien or encumbrance against the Premises.
22. MISCELLANEOUS.
A. Words of any gender used in this Lease shall be held and construed to
include any other gender, and words in the singular number shall be held to
include the plural, unless the context otherwise requires. The captions
inserted in this Lease are for convenience only and in no way define, limit
or otherwise describe the scope or intent of this Lease, or any provision
hereof, or in any way affect the interpretation of this Lease.
B. The terms, provisions and covenants and conditions contained in this
Lease shall run with the land and shall apply to, inure to the benefit of,
and be binding upon, the parties hereto and upon their respective heirs,
executors, personal representatives, legal representatives, successors and
assigns, except as otherwise herein expressly provided. Landlord shall have
the right to transfer and assign, in whole or in part, its rights and
obligations in the building and property that are the subject of this Lease.
Each party agrees to furnish to the other, promptly upon demand, a corporate
resolution, proof of due authorization by partners, or other appropriate
documentation evidencing the due authorization of such party to enter into
this Lease.
C. Landlord shall not be held responsible for delays in the performance of
its obligations hereunder when caused by material shortages, weather, acts of
God or labor disputes.
D. Tenant agrees, from time to time, within THIRTY (30) days after request
by Landlord, to deliver to Landlord or Landlord's designee, a certificate of
occupancy, current financial statements prepared in accordance with GAAP, and
and an estoppel certificate stating that this Lease is in full force and
effect, the date to which rent is paid and such other factual matters
pertaining to this lease as may be requested by Landlord. IF TENANT IS IN
DEFAULT UNDER THIS LEASE, Tenant hereby irrevocably appoints Landlord as
attorney-in-fact for the Tenant with full power and authority to execute and
deliver in the name of Tenant such estoppel certificate if Tenant fails to
deliver the same within such THIRTY (30) day period and such certificate as
signed by Landlord or Landlord's beneficiary, as the case may be, shall be
fully binding on Tenant, if Tenant fails to deliver a contrary certificate
within five (5) days after receipt by Tenant of a copy of the certificate
executed by Landlord or Landlord's beneficiary, as the case may be, on behalf
of Tenant.
E. This Lease constitutes the entire understanding and agreement of the
Landlord and Tenant with respect to the subject matter of this Lease, and
contains all of the covenants and agreements of Landlord and Tenant with
respect thereto. Landlord and Tenant each acknowledge that no
representations, inducements, promises or agreements oral or written, have
been made by Landlord or Tenant, or anyone acting on behalf of Landlord or
Tenant, which are not contained herein, and any prior agreements, promises,
negotiations, or representations not expressly set forth in this Lease are of
no force or effect. This Lease may not be altered, changed or amended except
by an instrument in writing signed by both parties hereto.
F. All obligations of Tenant hereunder not fully performed as of the
expiration or earlier termination of the term of this Lease shall survive the
expiration or earlier termination of the term hereof, including without
limitation, all payment obligations with respect to taxes and insurance and
all obligations concerning the condition and repair of the Premises. Upon the
expiration or earlier termination of the term hereof, and prior to Tenant
vacating the Premises, Tenant shall pay to Landlord any amount reasonably
estimated by Landlord as necessary to put the Premises, including without
limitation, all heating and air conditioning systems and equipment therein,
in good condition and repair, reasonable wear and tear excluded. Tenant shall
also, prior to vacating the Premises, pay to Landlord the amount, as
estimated by Landlord, of Tenant's obligation hereunder for real estate taxes
and insurance premiums for the PORTION OF THE YEAR in which the Lease expires
or terminates. All such amounts shall be used and held by Landlord for
payment of such obligations of Tenant hereunder, with Tenant being liable for
any additional costs therefor upon demand by Landlord, or with any excess to
be returned to Tenant after all such obligations have been determined and
satisfied as the case may be. Any security deposit held by Landlord shall be
credited against the amount due from Tenant under this Paragraph 22F.
G. If any clause or provision of this Lease is illegal, invalid or
unenforceable under present or future laws effective during the term of this
Lease, then and in that event, it is the intention of the parties hereto that
the remainder of this Lease shall not be affected thereby, and it is also the
intention of the parties to this Lease that in lieu of each clause or
provision of this Lease that is illegal, invalid or unenforceable, THE
PARTIES WILL DEVELOP A MUTUALLY ACCEPTABLE ADDENDUM TO THIS LEASE.,
Page 7
<PAGE>
I. Tenant represents and warrants that it has dealt with no broker, agent or
other person EXCEPT REGIONAL REALTY, in connection with this transaction or
that no broker, agent or other person EXCEPT REGIONAL REALTY, brought about
this transaction, other than as may be referenced in a separate written
agreement executed by Tenant, and delivered to Landlord, and Tenant agrees to
indemnify and hold Landlord harmless from and against any claims by any other
broker, agent or other person EXCEPT REGIONAL REALTY, claiming a commission
or other form of compensation by virtue of having dealt with Tenant with
regard to this leasing transaction.
J. If and when included within the term "Landlord", as used in this
instrument, there is more than one person, firm or corporation, all shall
jointly arrange among themselves for their joint execution of a notice
specifying some individual at some specific address for the receipt of
notices and payments to Landlord. If and when included within the term
"Tenant", as used in this instrument, there is more than one person, firm or
corporation, all shall jointly arrange among themselves for their joint
execution of a notice specifying some individual at some specific address
within the continental United States for the receipt of notices and payments
to Tenant. All parties included within the terms "Landlord" and "Tenant",
respectively shall be bound by notices given in accordance with the
provisions of Paragraph 25 hereof to the same effect as if each had received
such notice.
K. In the event the Premises constitute a portion of a multiple occupancy
building, Tenant's "proportionate share", as used in this Lease, shall mean a
fraction, the numerator of which is 15,631 and the denominator of which is
201,492 equaling 7.76 % ..
L. Submission of this Lease shall not be deemed to be a reservation of the
Premises. Landlord shall not be bound hereby until its delivery to Tenant of
an executed copy hereof signed by Landlord, already having been signed by
Tenant, and until such delivery Landlord reserves the right to exhibit and
lease the Premises to other prospective tenants. IF LANDLORD DOES NOT
EXECUTE AND RETURN THE LEASE WITHIN FOURTEEN (14) DAYS OF RECEIPT OF LEASE
EXECUTED BY TENANT, THIS LEASE WILL NO LONGER BE VALID. Notwithstanding
anything contained herein to the contrary Landlord may withhold delivery of
possession of the Premises from Tenant until such time as Tenant has paid to
Landlord the security deposit required by subparagraph 2B hereof and one
month's rent as set forth in Subparagraph 2A hereof.
M. SHOULD TENANT REQUIRE A 50% LARGER SPACE DURING THEIR LEASE TERM, AND
PROVIDED THE LEASE IS IN FULL FORCE AND EFFECT AND THE TENANT SHALL NOT BE IN
DEFAULT HEREUNDER, LANDLORD WILL ALLOW THEM TO RELOCATE, PROVIDED HOWEVER
THAT THE NEW SPACE IS AVAILABLE AND IS PART OF LANDLORD'S PORTFOLIO WITHIN
THE O'HARE CORRIDOR.
N. TENANT SHALL HAVE THE RIGHT TO A THREE (3) YEAR LEASE RENEWAL AT THE
EXPIRATION OF THE LEASE. TENANT MUST PROVIDE LANDLORD WITH WRITTEN NOTICE TO
RENEW 180 DAYS PRIOR TO THE LEASE EXPIRATION DATE. THE RENEWAL LEASE RATE
WILL BE DETERMINED BY THE CURRENT FAIR MARKET CONDITIONS. SHOULD LANDLORD AND
TENANT DISAGREE WITH THE FAIR MARKET RATE BOTH PARTIES WILL CONSULT WITH
INDEPENDENT FEE APPRAISERS TO DETERMINE THE FAIR MARKET RENEWAL RATE.
23. NOTICES. Each provision of this instrument or of any applicable
governmental laws, ordinances regulations and other requirements with
reference to the sending, mailing or delivering of notice or the making of
any payment by Landlord to Tenant or with reference to the sending, mailing
or delivering of any notice or the making of any payment by Tenant to
Landlord shall be deemed to be complied with when and if the following steps
are taken:
(a) All rent and other payments required to be made by Tenant to Landlord
hereunder shall be payable to Landlord at the address for Landlord set forth
below or at such other address as Landlord may specify from time to time by
written notice delivered in accordance herewith. Tenant's obligation to pay
rent and any other amounts to Landlord under the terms of this Lease shall
not be deemed satisfied until such rent and other amounts have been actually
received by Landlord. In addition to base rental due hereunder, all sums of
money and all payments due Landlord hereunder shall be deemed to be
additional rental owed to Landlord.
(b) All payments required to be made by Landlord to Tenant hereunder shall
be payable to Tenant at the address set forth below, or at such other address
within the continental United States as Tenant may specify from time to time
by written notice delivered in accordance herewith.
(c) Any written notice or document required or permitted to be delivered
hereunder shall be deemed to be delivered whether actually received or not
when deposited in the United States Mail, postage prepaid, Certified Mail,
addressed to the parties hereto at the respective addresses set out below, or
at such other address as they have theretofore specified by written notice
delivered in accordance herewith.
24. HAZARDOUS WASTE. The term "Hazardous Substances", as used in this Lease
shall mean pollutants, contaminants, toxic or hazardous materials or wastes,
petroleum products or any other substances, the removal of which is required
or the use of which is restricted prohibited or penalized by any
"Environmental Law", which terms shall mean any and all federal, state or
local laws including statutes, regulations, ordinances, codes, rules and
other governmental restrictions and requirements relating to the environment,
hazardous substances, or petroleum products including, but not limited to,
the Federal Solid Waste Disposal Act, the Federal Clean Air Act, the Federal
Clean Water Act, the Federal Resource Conservation and Recovery fact of 1976,
the Federal Comprehensive Environmental Responsibility, Cleanup and Liability
Act of 1980, regulations of the Environmental Protection Agency, regulations
of the nuclear Regulatory Agency, regulations or laws administered by OSHA
and regulations of any state department of natural resources or state
environmental protection agency now or at any time hereinafter in effect.
Tenant hereby agrees that (i) no activity will be conducted BY TENANT on the
Premises that shall produce any Hazardous Substance, except for such
activities that are part of the ordinary course of Tenant's business (the
"Permitted Activities") provided said Permitted Activities are conducted in
accordance with all Environmental Laws, are fully and completely disclosed to
Landlord, and are expressly approved in advance in writing by Landlord; (ii)
the Premises shall not be used BY TENANT in any manner for the storage of
HAZARDOUS SUBSTANCES, EXCEPT FOR those Hazardous Substances, except for such
storage that is in the ordinary course of Tenant's business in amounts
appropriate for such use (the "Permitted Material") UNLESS-such
Permitted Materials are properly stored in a manner and location meeting all
Environmental Laws, are fully and completely disclosed to Landlord, and are
expressly approved in advance in writing by Landlord; (iii) no portion of the
Premises shall be used BY TENANT as a landfill or a dump; (iv) Tenant shall
not install any underground tanks of any type; (v) Tenant shall not CAUSE-any
surface or subsurface conditions to exist or come into existence that
constitute, or with the passage of time may constitute, a public or private
nuisance; (vi) Tenant shall not permit any Hazardous Substances to be brought
onto the Premises IN CONNECTION WITH TENANT'S BUSINESS, except for the
Permitted Materials, and if so brought or found located thereon, the same
shall be immediately removed, with proper disposal, and all required removal
and cleanup procedures (AS REQUIRED BY LAW IN THE EVENT OF A RELEASE OF SUCH
HAZARDOUS SUBSTANCES SUBJECT TO SUCH REMOVAL) shall be diligently undertaken
pursuant to all Environmental Laws. IINSTER 1.) ATTACHED AS EXHIBIT C HERETO
AND INCORPORATED HERIN BY THIS REFERENCE IS A LIST OF PERMITTED MATERIALS
WHICH TENANT EXPECTS TO USE AT THE PREMISES, AND SUCH LIST ANDD ALL
REASONABLE SUBSTITUTES ARE HEREBY DEEMED APPROVED IN ADVANCE BY LANDLORD.
Tenant shall immediately give Landlord written notice as soon as Tenent
becomes aware of any suspected breach of this Paragraph, or any condition or
circumstance which makes the
Page 8
<PAGE>
WITH THE PREMISES, or which seeks criminal or punitive penalties from Tenant
for an alleged violation of Environmental Laws, or otherwise pertaining to
Hazardous Substances which may affect the Premises, together with a copy
thereof. In the event TENANT CAUSES ANY RELEASE OF ANY HAZARDOUS SUBSTANCES
WITHIN THE PREMISES, Tenant agrees, at the request of Landlord, to permit an
environmental audit, to be conducted by the Landlord or an independent agent
selected by the Landlord TO BE CONDUCTED UPON FORTY-EIGHT (48) HOURS ADVANCE
NOTICE AT A REASONABLE TIME AND IN A MANNER WHICH SHALL NOT BE UNREASONABLY
DISRUPTIVE TO TENANT'S USE OF THE PREMISES. This provision shall not relieve
the Tenant from conducting its own environmental audits or taking any other
steps necessary to comply with Environmental Laws. Landlord, in the event it
is named as a party, shall have the right, but not the obligation, to join
and participate in any legal proceedings or actions initiated in connection
with any matters related to Environmental Laws and to have its attorneys'
fees in connection therewith paid by Tenant. Tenant shall, at Landlord's
request, defend all suits, actions or proceedings commenced against Landlord
with counsel approved by Landlord, in Landlord's sole discretion, and Tenant
shall pay all costs and judgments associated therewith. Tenant shall
indemnify, defend and hold Landlord, and any property manager of the
Premises, their directors, officers, employees, agents, successors and
assigns (THE "LANDLORD INDEMNITIES"), harmless from and against all claims,
demands, actions, losses, liabilities, costs, expenses, damages and
obligations of any nature (including, without limitation, diminution in value
of the Premises; all consequential damages; the cost of any required or
necessary repair, cleanup or detoxification of the Premises; the preparation
and implementation of any closure, remedial or other required plans; damages
for the loss or restriction on use of rentable or usable space or of any
amenity of the Premises; damages arising from any adverse impact on marketing
of space; damages to adjacent property; costs of restoring the Premises, and
sums paid in settlement of claims, attorneys' fees, court costs, consultant
fees, and expert fees, COLLECTIVELY "LIABILITIES") incurred by or asserted
against Landlord and directly or indirectly as a result of, arising from,
connected with, or attributable to TENANT'S, or the generation, storage,
release, threatened release, discharge, disposal, removal or presence of any
Hazardous Substances BROUGHT ONTO THE PREMISES BY TENANT OR ITS CONTRACTOR,.
or relating to any activity, act or omission BY TENANT OR ITS CONTRACTORS
involving Hazardous Substance, or TENANT'S noncompliance with any
Environmental Law, PROVIDED THAT THE FOREGOING INDEMNITY DEFENSE AND HOLD
HARMLESS OBLIGATIONSOF TENANT SHALL NOT APPLY TO THE EXTENT ANY SUCH
LIABILITIES ARE CAUSED, OR CONTRIBUTED TO BY ANY OF THE LANDLROD INDEMNITIES
OR THEIR CONTRACTORS. (INSERT 2) LANDLORD SHALL INDEMNIFY, DEFEND AND HOLD
TENANT, ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, SUCCESSORS AND ASSIGNS
(THE "TENANT INDEMNITIES"), HARMLESS FROM AND AGAINST ALL LIABILITIES
INCURRED OR ASSERTED AGAINST TENANT AND DIRECTLY OR INDIRECTLY AS A RESULT
OF, ARISING FROM, CONNECTED WITH, OR ATTRIBUTABLE TO (I) THE GENERATION,
INSTALLATION, STORAGE, RELEASE, THREATENED RELEASE, DISCHARGE, DISPOSAL, OR
REMOVAL FO ANY HAZARDOUS SUBSTANCES BY A LANDLORD INDEMNITEE OR THEIR
CONTRACTORS, OR (II) ANY ACTIVITY, ACT OR OMISSION INVOLVING HAZARDOUS
SUBSTANCES, OR ANY NONCOMPLIANCE WITH ANY ENVIRONMENTAL LAW, BY A LANDLORD
INDEMNITEE OR THEIR CONTRACTORS, The foregoing indemnification shall survive
the termination or expiration of the Lease. Notwithstanding anything to the
contrary contained in this Lease, any default under the terms of this
Paragraph shall be a material default under this Lease enabling Landlord, at
Landlord's option, to immediately exercise any of the remedies set forth in
this Lease, in addition to any other remedies available to Landlord, without
notice to Tenant and without obligation to provide any grace or cure period
to Tenant. Notwithstanding anything to the contrary contained herein,
Landlord's approval of any activity or storage relating to any Hazardous
Substance is not intended to, and shall not, be deemed an undertaking by
Landlord to determine whether or not such activity or storage is in
compliance with Environmental Laws and Landlord assumes no responsibility
with respect thereto.
25. ADDITIONAL PROVISIONS. See EXHIBITS "A", "B", "C" attached hereto and
incorporated by reference herein.
Page 9
<PAGE>
EXECUTED BY LANDLORD, this _________ day of ___________, 19__.
Attest /Witness SSMRT BENSENVILLE INDUSTRIAL
PARK (3), INC.
------------------------ -------------------------
By: /s/ [ILLEGIBLE]
------------------------ -----------------------
Title: Title: ASSET MANAGER 6-4-96
------------------ --------------------
ADDRESS:
-------------------------
-------------------------
-------------------------
--------------------------
EXECUTED BY TENANT, this _____________ day of _________, 19 ___.
Attest/Witness
-------------------------- -------------------------
By: /s/ Rocky Genovese
--------------------------- ----------------------
Title: Title: President
--------------------- --------------------
ADDRESS:
-------------------------
-------------------------
-------------------------
-------------------------
Page 10
<PAGE>
EXHIBIT "A"
LANDLORD WILL PERFORM THE FOLLOWING SPACE IMPROVEMENTS:
1. Demo a portion of existing office space.
2. Clean and seal warehouse floor.
3. Install glass entrance door.
4. Repaint office area.
5. Install tile in general office area. (Tenant to supply tile).
6. Install concrete block to existing rail door.
Within ten (10) days after the commencement date Tenant shall submit to
Landlord a punch list of items needing completion or correction. Landlord
shall use its best efforts to complete such items within (14) days after the
receipt of such notice.
<PAGE>
EXHIBIT "B"
That part of Lot 6 in Thorndale Distribution Park in Bensenville, Unit 2,
Being a Subdivision of part of the South 1/2 of Section 2, Township 40.
North, Range 11, East of the Third Principal Meridian, according to the Plat
thereof recorded November 7, 1977 as Document No. R77-102030 and consent to
contents and recordation of Plat recorded January 31, 1978 as Document No.
R78-08789, described as follows: beginning at the intersection of the East
line of said Lot 6 with a line 702.00 feet, as measured at right angles,
south of and parallel with the north line of said Lot 6; thence South 00
degress 34 minutes 25 seconds East along the East line of said Lot 6, 616.51
feet; thence South 89 degrees 28 minutes 26 seconds West, 640.12 feet to the
West line of said Lot 6; thence North 00 degrees 31 minutes 34 seconds West
along the West line of said Lot 6, 607.55 feet to an intersection with a line
702.00 feet, as measured at right angles, south of and parallel with the
North line of said Lot 6; thence North 88 degrees 40 minutes 15 seconds East
along said last described parallel line, 639.67 feet to the place of
beginning, in DuPage County, Illinois containing a 201,492 square foot
building commonly referred to as 870 Thomas Drive in Bensenville, Illinois
60106.
<PAGE>
EXHIBIT "C"
[Site Plan]
<PAGE>
PERMITTED MATERIALS
EXHIBIT "C"
I. NON-FLAMMABLE SOLVENT FREE FLOORING ADHESIVES:
- BR 200-92
- BR-102
- BR-829
- BR-830
- BR-831
II. OTHER:
- ZYLENE
- BR700 - ROOFING ADHESIVE
- BR772 - LINER WELD
</TEXT>
</DOCUMENT>