PAGE NUMBERS REFER TO PAPER DOCUMENT ONLY.)
(PAGE NUMBERS REFER TO PAPER DOCUMENT
ONLY.)
CONFIDENTIAL TREATMENT REQUESTED FOR PORTIONS OF
THIS DOCUMENT.
PORTIONS FOR WHICH CONFIDENTIAL TREATMENT IS
REQUESTED ARE
DENOTED WITH BRACKETS.
Wal-Mart Stores East, LP, individually
and only as to Stores (as defined in Section 1.1K of this Master Lease) owned,
leased, or operated in AL, CT, DC, DE, FL, GA, IN, KY, ME, MD, MA, MI, MS, MO,
NH, NJ, NM, NY, NC, OH, OK, PA, RI, SC, TN, VT, VA, WI, WV; Wal-Mart Stores,
Inc., individually and only as to Stores owned or leased in AK, AR,
AZ, CA, CO, HI, ID, IL, IA, KS, MN, MT, NE, NV, ND, OR, SD, UT, WA, WY; Wal-Mart
Louisiana, LLC, individually and only as to Stores owned or leased in
Louisiana; and Wal-Mart Stores Texas, LP, individually and only as to
Stores owned or leased in Texas (each referred to as “Landlord” for purposes of
this Master Lease Agreement as it applies to the Store) and Portrait Corporation
of America, Inc. (“Tenant”) enter into this Master Lease Agreement effective the
8th
day of .
Whereas, Landlord operates discount
retail stores nationwide;
Whereas, Tenant
operates offering (described more fully in Appendix-1) and desires to
lease space within one or more Stores from which to operate such;
and
Whereas, Landlord desires to lease
space in one or more of its Stores to Tenant, so Tenant may operate such in
the Store.
Now, therefore, in consideration of the
mutual promises and premises set forth above and below, the receipt and
sufficiency of which the parties hereby acknowledge, the parties hereby agree as
follows:
Article
I
General
Provisions
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A.
“Attachment A” means an attachment to this Master Lease Agreement,
incorporated into this Master Lease Agreement when fully signed by Tenant
and by the particular Landlord with authority to lease the property
identified in the applicable Attachment A, that identifies the Store in
which the Leased Premises is located; the anticipated Delivery Window, as
defined in Section 1.1F, below; the anticipated Delivery Date, as defined
in Section 1.1E, below; the anticipated Rent Commencement Date, as defined
in Section 4.1, below; and the Extension, as described in the applicable
Attachment A.
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B.
“Appendix-1” means an appendix to this Master Lease Agreement,
incorporated into this Master Lease Agreement when fully signed by Tenant
and Landlord, which provides obligations of Landlord and Tenant specific
to Tenant’s Permitted Uses (as designated in Appendix-1) contemplated by
Landlord and Tenant at the time this Master Lease Agreement was entered
into.
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C.
“Commencement Notice” means an attachment to this Master Lease Agreement,
incorporated into this Master Lease Agreement at the time of delivery by
Landlord of the Commencement Notice to Tenant in accordance with Section,
below, which identifies the actual Rent Commencement Date and the actual
Delivery Date, as each term is defined
below.
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1
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D.
“Common Area” means the public access areas of the Store and surrounding
land leased or owned by Landlord on which the Store is located including,
but not limited to, the parking areas, driveways, sidewalks, entrances,
and exits in the Store and between the Store and the Leased
Premises.
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E.
“Delivery Date” means the date on which Landlord delivers possession of
the applicable Leased Premises to
Tenant.
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F.
“Delivery Window” means the span of time in which Landlord may deliver
possession of the Leased Premises to
Tenant.
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G.
“Due Date” means the first (1st)
calendar day of each month, unless this day falls on New Year’s Day,
Memorial Day, Independence Day (US), Labor Day, Thanksgiving, or
Christmas, in which case the Due Date means the following business
day.
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H.
“Leased Premises” means the area of a Store leased to the Tenant by
Landlord subject to the terms and conditions of this
Agreement.
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I.
“Master Lease” means this Master Lease Agreement and any amendment,
appendix, attachment, and exhibit attached to and incorporated into this
Master Lease Agreement.
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J.
“Rent” means the Base Rent defined in Section 4.2, below, and described in
the applicable Attachment A, plus any additional or other rent, interest,
tax, or other sum this Master Lease obligates Tenant to pay
Landlord.
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K.
“Store” or “Stores” means the “Wal-Mart” retail store operated by
Landlord.
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L.
“Sublessee” means the franchisee, licensee, concessionaire, or other
party, of Tenant which, pursuant to a separate agreement between it and
Tenant, is operating the Leased Premises as part of a marketing plan or
system prescribed by Tenant that is substantially associated with Tenant’s
trademark, service ▇▇▇▇, trade name, logotype, advertising, or other
commercial symbol designated by Tenant and is subject to the terms and
conditions of this Master Lease.
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M.
“White Box” means the interior condition of the Leased Premises with
sprinklers, sheetrock walls, ceiling grid, HVAC installed, 100 amp service
to the Leased Premises, security gate, acoustic ceiling tile, lighting and
electrical outlets, and access to water and
sewer.
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1.2
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Landlord’s Entry into
the Agreement.
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A.
Each Landlord enters into this Master Lease severally and solely as to the Store
it operates and in which the Leased Premises is located and without any
obligation with respect to any other Store. Accordingly, only the
respective Landlord that operates the Store in which such Leased Premises is
located may execute, for a Leased Premises, an Attachment A.
B. If,
during the term of this Master Lease, it is determined that the use of the
Leased Premises is Restricted, as defined in the following sentence, Landlord
may remove/cancel the applicable Attachment A from the Master Lease and the
applicable Attachment A will be null and void without further action by Landlord
or Tenant. Neither Landlord nor Tenant will be liable to the other
for any damages, loss, or liability in connection with the
2
cancellation
of this Master Lease as to the affected Leased Premises. For the
purpose of this paragraph, “Restriction” means any covenant, condition, law,
regulation, restriction, rule, or other matter binding to the Leased Premises,
Landlord, or Tenant or any combination thereof, which acts to prohibit or
materially restrict the use of the Leased Premises from any of the matters
contemplated by this Master Lease including, without limitation, that ability of
Landlord to lease to Tenant or Tenant’s ability to operate its type of business
in the Leased Premises. By way of example, and not of limitation, if
Landlord is required to obtain the consent of a third party prior to leasing
space to the Tenant in a particular Store, the requirement of consent is a
Restriction.
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1.3
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Landlord’s
▇▇▇▇▇▇▇▇▇. If Landlord is itself a lessee of a Store in
which a Leased Premises is located, so that this Master Lease as to the
particular Leased Premises is actually a sublease, Tenant accepts this
Master Lease subject to all the terms and conditions of the ▇▇▇▇▇▇▇▇▇
under which Landlord holds the Leased Premises as
lessee. Tenant covenants that it will do no act or thing that
would constitute a violation of the
▇▇▇▇▇▇▇▇▇.
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1.4
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Granting
Language. Upon the
full execution of the applicable Attachment A, Landlord leases to Tenant
and Tenant rents from Landlord (subject and subordinate to any mortgage,
deed or trust, or other lien presently existing or hereafter placed upon
the applicable Leased Premises, the Common Areas, the Store, or any
combination thereof) the Leased Premises identified in the applicable
Attachment A to have and to hold subject to the terms of this Agreement,
by which the parties intend to be legally bound as to the applicable
Leased Premises upon the execution by each appropriate party of both this
Master Lease and the applicable Attachment
A.
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Construction
and Acceptance of the Leased Premises
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Landlord’s Obligation
to Deliver Possession on the Delivery
Date.
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A.
Landlord shall use commercially reasonable efforts to deliver the
applicable Leased Premises to Tenant in the condition and during the
Delivery Window specified in the applicable Attachment
A.
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(1)
Unless otherwise agreed to in the applicable Attachment A, Landlord shall
notify Tenant, in writing and no later than ten (10) days prior to the
first day of the Delivery Window, of the status of the construction of the
applicable Leased Premises and of the anticipated Delivery Date within the
Delivery Window on which Landlord estimates it will deliver possession of
the applicable Leased Premises to
Tenant.
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(2) Landlord,
at any time prior to notifying Tenant of the anticipated Delivery Date,
may revise the Delivery Window.
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(3)
Landlord may revise the anticipated Delivery Date at any time after
Landlord notifies Tenant of the anticipated Delivery Date, in accordance
with this Article II, but in no event may Landlord revise the anticipated
Delivery Date with less than 24-hours
notice.
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3
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B.
Landlord will not breach this Lease if it is unable to deliver possession
of the applicable Leased Premises to Tenant on the anticipated Delivery
Date or within the Delivery Window specified in the applicable Attachment
A, and Tenant waives any right or remedy it may have, at law or in equity,
because of the delay in performance. If Landlord and Tenant
agree that delivery of possession is unfeasible within a commercially
reasonable amount of time after the Delivery Window specified on the
applicable Attachment A, the parties, without liability, may terminate
this Master Lease as to the applicable Leased
Premises.
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Tenant’s Right of
Entry.
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A.
Prior to the Delivery Date, Tenant may enter the Leased Premises only to
inspect and measure the Leased Premises to ready the Leased Premises for
opening on the Rent Commencement Date, as described in Section, below, and
as designated in the applicable Attachment
A.
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B.
Tenant may enter the Leased Premises in accordance with the preceding
paragraph only if:
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(1)
Landlord and Tenant have previously signed an Attachment A for the Leased
Premises,
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| (2) Tenant does not interfere with Landlord's performance of its obligations under Section, above, or with the transaction of Landlord's business or the business of any of Landlord's other Tenants, and |
| (3) The Leased Premises is not currently in the possession of another tenant. |
C.
If any work or other action done by, or on behalf of, Tenant results in a
stoppage of Landlord’s work, Tenant will immediately stop work until the parties
mutually agree Tenant’s work can re-commence without materially interfering with
Landlord’s obligations under Section, above, which time may not be any later
than the Delivery Date. Any failure by Tenant to comply with the
provisions of this Section 2.2C is a material breach.
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2.3
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Acceptance of the
Leased Premises.
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A.
Landlord makes no representations, covenants, or warranties of any kind or
character whatsoever, express or implied, with respect
to:
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(1)
The quality, condition, or title of the applicable Leased
Premises;
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(2)
The suitability of the applicable Leased Premises for any activity and use
that the Tenant may conduct in that Leased Premises according
to this Master Lease;
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(3)
Compliance of the applicable Leased Premises with any applicable
law;
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(4)
The habitability, merchantability, or fitness for a particular purpose of
the applicable Leased Premises;
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(5)
The environmental condition of the applicable Leased Premises;
or
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(6)
Whether Tenant’s anticipated or actual use of the Leased
Premises complies with the applicable land use
restrictions.
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4
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B.
Tenant shall accept possession of the applicable Leased Premises when
delivered by Landlord, even if Landlord is unable to deliver possession
during the Delivery Window or on the anticipated Delivery Date, unless
this Master Lease as to the applicable Leased Premises has been terminated
according to Section, above.
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C.
TENANT WAIVES ALL RIGHTS WITH RESPECT TO ANY DEFECT IN THE LEASED
PREMISES, AND IF TENANT FAILS TO NOTIFY LANDLORD OF ANY DEFECT AT LEAST
FIVE (5) DAYS AFTER THE DATE OF DELIVERY, TENANT CONCLUSIVELY ACCEPTS THE
LEASED PREMISES “AS IS” AND WITH ALL
FAULTS.
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D.
TENANT WAIVES ALL RIGHTS AGAINST LANDLORD WITH RESPECT TO ANY LIMITATION
OR RESTRICTION ON ITS USE OF THE LEASED PREMISES AS A RESULT OF ANY
APPLICABLE LAW, RULE, OR REGULATION INCLUDING, WITHOUT LIMITATION, LAND
USE RESTRICTIONS.
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Tenant’s Obligations
to Prepare the Leased Premises to Open for
Business.
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A.
Tenant shall open the Leased Premises on the Rent Commencement Date (as
defined in Section 4.1, below, and designated on the applicable Attachment
A). If Tenant fails to open the applicable Leased Premises on
the Rent Commencement Date and the failure is not caused by Landlord’s
material interference or default under this Master Lease, Landlord may
charge Tenant liquidated damages of [***] and additional liquidated
damages of [***] a day for each day, including the Rent Commencement Date,
which the Leased Premises remains unopened as required by the preceding
sentence. By way of example, and not as a limitation thereof, material
interference may occur if Landlord fails to deliver possession to Tenant
of the applicable Leased Premises with sufficient time before the Rent
Commencement Date for Tenant to fulfill its obligations under this Article
II. Tenant will pay any liquidated damages it owes to
Landlord within thirty (30) days after Tenant receives an invoice from
Landlord for the liquidated damages. Landlord and Tenant
acknowledge that it would be impracticable to fix the actual damages
suffered by Landlord as a result of Tenant’s failure to open the Leased
Premises on the Rent Commencement Date, according to this paragraph, and
that the amount of liquidated damages described in the preceding sentence
represents fair and reasonable compensation to Landlord for this
failure. If the Leased Premises remains unopened for more than
three (3) consecutive days following the Rent Commencement Date, Tenant
will materially breach this Master
Lease.
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B.
Tenant shall complete all Improvements within the Leased Premises in order
to open the Leased Premises on the applicable Rent Commencement
Date. For the purposes of this Master Lease, “Improvements”
means any addition, alteration, construction, finish, or improvement to
the Leased Premises; any attachment of a permanent fixture, permanent
furniture, or permanent equipment; and includes, but is not limited to,
completing the interior walls, partitioning(s), floor covering, ceiling
work, utilities, painting, finish work, restroom facilities, signage
(pursuant to Section 2.6, below), and any other thing
necessary.
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C.
Tenant shall submit to Landlord and obtain Landlord’s approval of the
floor plans and layouts of the Leased Premises including dimensions,
elevations, Improvements, intended colors, and Trade Fixtures (as defined
in Section 2.4D(1), below). Tenant shall obtain Landlord’s
approval of the floor plans and layouts of the Leased Premises prior to
seeking and obtaining any permits, licenses, certifications, or other
documents necessary to complete the Improvements in the Leased Premises
and install Trade Fixtures in the Leased Premises in accordance with this
Agreement. All Trade Fixtures and Improvements must accord with
the plans and specifications previously approved by Landlord and must be
of high quality materials and workmanship, comparable to or better than
the tenant storefront, Improvements, and Trade Fixtures used by other
retailers in the vicinity of the Store and, specifically, used at Tenant’s
most recent prototype. Tenant may not vary from or add to the previously
approved plans or specifications without Landlord’s prior, written
consent, which Landlord may not unreasonably withhold or
delay. Landlord’s approval of Tenant’s plans and specifications
is solely based on Landlord’s review. Landlord's approval of
the plans and specifications does not represent government approval or
suitability of the plans and specifications for the intended
purposes.
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5
(1) Prior
to any roof penetrations caused by Tenant’s Improvements, Tenant shall obtain
from Landlord’s Leasing Operations Department the contact information for the
contractor approved to work on Landlord’s roof.
(2) If
Tenant’s roof-top heating, ventilating, and air conditioning unit, or other
rooftop equipment, requires steel supports in addition to the steel framing
erected by Landlord, then Tenant will pay the cost of labor and materials for
the installation thereof. Mechanical equipment on the roof will be
placed within the area designated on Landlord’s structural
drawings. Tenant’s plans and specifications of the proposed
mechanical equipment must be submitted to Landlord for approval.
(3)
Tenant will provide screening or other type of cover for such mechanical
equipment to prevent visibility by the public and subject to approval of
landlord and the local governmental authorities. If Landlord or any
governmental authorities requires a project standard equipment screen, Tenant
will use and pay for same.
D. Tenant
shall:
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(1)
Install any attached or unattached, moveable or non-moveable fixtures,
furniture, or equipment unique to Tenant’s business, the installation and
removal of which requires no cutting, drilling, or other defacing of the
Leased Premises (“Trade Fixtures”).
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(2)
Conduct the Improvements and install the Trade Fixtures in a good and
workmanlike manner in accordance with all applicable laws and in
accordance with obligations and requirements of this Master Lease
including, but not limited to, insurance, licensing, and regulatory
compliance requirements.
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(3) For
existing locations, erect a dust wall of plywood or sheetrock, but not
plastic or canvas, across the entrance to the Store from the Leased
Premises prior to commencing Improvements and maintain the same in place
throughout construction.
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6
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(4) Conduct
Improvements and install Trade Fixtures without interfering with other
construction in progress at the Store or with the transaction of
Landlord’s business or the business of any of Landlord’s other
lessees.
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E.
If Landlord requests, Tenant will secure a bond or other security satisfactory
to Landlord against any loss, liability, or damage to persons or property
related to the Improvements.
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2.5
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Tenant’s
Contractors. Tenant’s contractors must be licensed,
carry worker’s compensation coverage as required by law, and comply with
all applicable laws including, but not limited to, obtaining any required
permit, license, or other documentation necessary to perform the
construction work in connection with this Master Lease. At
Landlord’s request, Tenant will provide Landlord with a list of all
contractors and subcontractors Tenant is
using.
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Signs.
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A.
Tenant may not install on the exterior of the Store any sign, light,
decoration, painting, awning, canopy, or any other like item, (“Signs”)
unless otherwise provided in
Appendix-1.
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B.
Tenant may, with the prior, written consent of Landlord and in accordance
with Section 2.6C, install a Sign on the exterior bulkhead of the
applicable Leased Premises, which is inside the Store in which a Leased
Premises is located, with Tenant’s trade name identified in Appendix-1 to
this Master Lease and Tenant’s
logo.
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C.
Tenant may not install any Sign containing images or words that may offend
the ordinary, reasonable person including, but not limited to, words or
images that are cloaked in other words or images, phrases with double
meanings, and words or images commonly considered to be vulgar, swear, or
curse words. If Tenant’s business or trade name violates this
provision, Tenant may not use the name in any signage in or around the
Leased Premises.
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2.7
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Landlord’s Right of
Re-Entry. After the Delivery Date and before the Rent
Commencement Date designated on the applicable Attachment A, Landlord may
re-enter the applicable Leased Premises to continue any portion of
Landlord’s work not yet complete. During this period of
re-entry, Landlord may not unreasonably interfere with any work required
under Section being performed by Tenant or on behalf of
Tenant.
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2.8
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Certificate of
Occupancy. Tenant shall fax a copy of the Certificate of
Occupancy within two (2) calendar days after receiving it to Landlord’s
Project Management at
(▇▇▇) ▇▇▇-▇▇▇▇.
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Article
III
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Binding
Effect of the Attachment A, Commencement
Notice
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Master
Lease Term and Extension
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3.1
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Effective Date of
Master Lease. This Master Lease is effective and binds
Landlord and Tenant as of the Effective Date entered
above. This Master Lease terminates in its entirety upon the
termination, for whatever reason, of every Attachment A signed by Landlord
and Tenant that attaches to this Master Lease and which is incorporated
into this Master Lease.
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7
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3.2
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Binding Effect of the
Attachment A. This Master Lease governs each Leased
Premises for which Landlord and Tenant execute an Attachment
A. Once signed by both Landlord and Tenant, each Attachment A
attaches to and incorporates into this Master Lease binding both Landlord
and Tenant to the terms and conditions in both this Master Lease and the
applicable Attachment A as to the applicable Leased
Premises.
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3.3
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Commencement
Notice. Landlord will deliver the Commencement Notice to
Tenant, no sooner than forty five (45) days following the actual Rent
Commencement Date of the applicable Leased Premises. The
Commencement Notice is for informational purposes only and does not modify
the terms of this Master Lease. If Tenant does not receive the
Commencement Notice within that time, Tenant will notify Landlord, in
writing or verbally. Any delay in delivery of the Commencement
Notice is not a breach of this Master
Lease.
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Lease Term of a
Specific Leased Premise. The Lease Term for each Leased
Premises commences on the day on which the applicable Landlord and Tenant
each sign the Attachment A for that Leased Premises and continues until
the Expiration Date. For the purpose of this Master Lease,
“Expiration Date” means 11:59 pm (local time as to the applicable Leased
Premises) on the last day of the month in which the anniversary date of
the Rent Commencement Date, designated in the applicable Attachment A,
falls. If the anniversary date falls between July 1st
and December 31st
of a given year, and then the Expiration Date extends to 11:59 pm (local
time as to the applicable Leased Premises) on January 31st
of the following year. In case of cancellation or termination,
the Expiration Date becomes the date on which the lease is cancelled or
terminated.
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Extension of the Lease
Term. The Lease Term for the applicable Leased Premises
may extend, subject to the terms and conditions of this Master Lease, as
designated in the applicable Attachment A. In the event that
the Lease Term of the applicable Leased Premises extends, any reference to
the term “Lease Term” includes the period by which the Lease Term
extends.
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Article
IV
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Rent,
Security, Tax Increases
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Rent Commencement
Date. Tenant’s obligation under this Master Lease to pay
Rent, in lawful money of the United States and without, for any reason,
deduction or offset, begins on the Rent Commencement Date. For
the purposes of this Master Lease, the Rent Commencement Date is
either:
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A.
The first day on which the Store opens for business to the public (“Grand
Opening”), as memorialized in the applicable Commencement Notice, if the
Leased Premises is located in a new, relocated, or expanded Store;
or
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B.
The day specified in the applicable Attachment A, if the Leased Premises
is located in a Store currently in operation that has not or will not be
relocated or expanded between the time that the Attachment A is executed
and the Rent Commencement Date.
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8
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Base
Rent.
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A.
Tenant shall pay Base Rent to Landlord for each Leased Premises for which
Landlord and Tenant execute an Attachment A at the rate set forth in the
applicable Attachment A and any additional or other sum, rent, interest,
or tax required by this Master
Lease.
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B.
Tenant, without offset, notice, or demand, shall pay Base Rent in equal
monthly installments with each monthly installment due by the Due
Date. If the Rent Commencement Date occurs after the first day
of the month, the Base Rent for that month equals one-thirtieth (1/30th)
of the normal monthly rent installment for each day starting on the Rent
Commencement Date and continuing through midnight on the last day of that
month.
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4.3
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Interest on Late
Payments.
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A.
Tenant shall pay to Landlord interest on any balance of Rent unpaid more
than ten (10) days following the Due Date at the prorated rate, based on a
30-day month, of the lesser of:
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(1)
[***] per month, or
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(2)
The maximum amount allowed by law.
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B.
Any interest due under this provision is additional rent, and Tenant shall
pay it in full no later than the day on which it pays the unpaid balance
of Rent unless demanded earlier by Landlord. Interest will not
accrue on any unpaid balance of Rent if
the:
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| (1) Unpaid balance is due to an error or problem with the automatic debit, if Tenant is paying Rent through an automated clearing house account,and |
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(2)
The error or problem was not due to the intentional or negligent act of
Tenant.
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4.4
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Quarterly Rent
Payment. Landlord may require Tenant pay the Base Rent
on a quarterly basis rather than monthly if, for two (2) consecutive
months, Tenant fails to pay timely the Base Rent according to Section
4.2. The quarter will commence on the first day of the month
following the month that Landlord notifies Tenant in writing of this
election.
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Method for Rent
Payment. Tenant shall pay Rent as required in the
applicable Attachment A.
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Surety
Bond.
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A.
In addition to any other obligation of Tenant under this Master Lease,
Tenant, for each Leased Premises, shall execute and deliver a surety bond
to Landlord in lieu of a security deposit assuring Landlord that it will
perform its obligations herein for each Leased Premises under this Master
Lease.
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B.
Tenant shall obtain a bond equal to the sum of three (3) months rent on
the applicable Leased Premises from a reputable company satisfactory to
Landlord.
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C.
In addition to any other right or remedy available at law, in equity, or
under this Master Lease, Landlord may claim against the bond an amount
equal to the Rent owed to Landlord that Tenant failed to pay timely, such
amount not to exceed the penal sum of the
bond.
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D.
Any claim or payment under the bond in no way relieves Tenant of its
obligations under this Master Lease to pay Rent or other charges in excess
of the penal sum of the bond.
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E.
Tenant, at the request of Landlord, will replace the bond when claims
against the bond equal or exceed the penal sum of the
bond.
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F.
Each bond must be in full force and effect within ten (10) days of Tenant
signing the applicable Attachment A and must continue for the Lease Term
of the applicable Leased Premises.
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Taxes.
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A.
Landlord shall pay all General Taxes levied, during each fiscal tax year,
against the Store, the Common Area, or both. “General Taxes”
means all general real estate taxes, general and special assessments,
parking surcharges, and other governmental
charges.
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B.
In addition to Tenant’s other obligation under this Master Lease, Tenant
shall pay any tax or assessment:
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(1) Levied against Tenant’s Improvements, inventory, personal property, and
Trade Fixtures;
(2) Assessed, imposed, or levied against Landlord in relation to either
Landlord’s interest in this Master Lease or the Rent and or other charges
required
under
this Master Lease including, but not limited to, increases
or additional, special, regular, unforeseen, foreseen, extraordinary, or
ordinary, taxes and
assessments, whether occurring wholly or partially during the Lease Term of the
specific Leased Premises from which the
taxes or assessments arise;
(3) Imposed against Landlord because of Landlord’s interest in this Master Lease
as a substitute, in whole or in part, for a real estate tax or
assessment.
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C.
Tenant shall reimburse Landlord, upon demand, for any tax, assessment, or
excise that was imposed, assessed, or levied against Landlord that
Landlord paid but for which Tenant is primarily liable under this Master
Lease.
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Article
V
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Utilities
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Utilities. Unless
otherwise agreed to in this Master Lease, Landlord shall pay for all
public utilities furnished to the Leased Premises and shall reasonably
cool, heat, and light and provide water and sanitary sewerage services to
the building in which the Leased Premises is located. Landlord
is not liable for any interruption whatsoever to the public utilities, the
lighting, the cooling, the heating, the water, or the sanitary sewerage
services if any of the preceding are
interrupted:
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A.
Due to equipment failure, fire, accident, strike, acts of God, or other
causes beyond the reasonable control of Landlord;
or
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B.
In connection with Store Renovations or to repair the Store or the Leased
Premises.
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10
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Telephone
Service. Tenant shall pay for telephone service in the
Leased Premises. The use of
a cordless phone within a Leased Premises is strictly
prohibited.
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Article
VI
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Use
and Operation
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6.1
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Use. Tenant
shall use the Leased Premises as designated in Paragraph 1 of Appendix-1,
Permitted Uses, subject to applicable legal requirements, and for no other
purpose without the prior, written consent of
Landlord.
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6.2
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Continuous
Operation.
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A.
Tenant, other than as expressly permitted by this Master Lease and during
the applicable Lease Term, shall operate the applicable Leased Premises
continuously during the Hours of Operation designated in Appendix-1 and in
accordance with the Permitted Uses designated Appendix-1 and with the
terms and provisions of this Master
Lease.
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B.
Tenant, other than as expressly permitted by this Master Lease shall not
vacate the applicable Leased Premises during the applicable Lease Term or
cease operations in the applicable Leased Premises and shall conduct its
business, at a minimum, in an efficient, first-rate, and reputable
manner.
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C.
Other than closing the Leased Premises to repair, update, and upgrade the
Trade Fixtures, the Improvements, and the Leased Premises in accordance
with Section 7.3B, below, Tenant may close the applicable Leased Premises
for repair or renovation only with the prior, written consent of Landlord,
which Landlord may not unreasonably withhold or
delay.
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D.
Failure to comply with this provision or any representation by Tenant that
during the applicable Lease Term the Tenant, or one of its Sublessees,
will not comply with this provision or will vacate the applicable Leased
Premises materially breaches this Master
Lease.
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6.3
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Hours of
Operation. Tenant, other than as expressly permitted by
this Master Lease and during the applicable Lease Term, shall conduct its
business in the Leased Premises as specified in Appendix-1 and, in
accordance with Section 2.6, above, shall post its Hours of Operation in a
conspicuous location within the Leased
Premises.
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Trade
Name. During the term of this Master Lease, Tenant shall
conduct its business under the name designated as Tenant’s Trade Name in
Appendix-1 and under no other name without the prior, written consent of
Landlord.
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A.
Tenant acknowledges that Landlord relied on Tenant’s business reputation and
associated trade name as a significant material inducement in Landlord’s
decision to execute this Master Lease, and therefore, Tenant hereby warrants
that Tenant has the right to use the trade name and all logos, trade dress,
slogans, and all other identifying marks used by Tenant at the Leased
Premises.
B.
Failure to comply with this Section is a material breach of this Master
Lease.
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6.5
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Customer
Service.
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11
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A.
Tenant shall operate the Leased Premises in conformity with Landlord’s
reputation as the operator of discount retail stores dedicated to customer
satisfaction and prompt quality customer service featuring a broad
assortment of quality merchandise at low, competitive
prices.
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B.
Tenant, at its sole cost and expense, shall post, in a conspicuous
location that customers can see when the Leased Premises is open and when
the Leased Premises is closed, a telephone number and an address for
customers to contact. The telephone number must be either toll
free or a number local to the applicable Leased
Premises.
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6.6
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Window Display
Lights. Tenant shall keep, during the Hours of
Operation, any display windows in the Leased Premises neat and
attractive.
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6.7
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Mail &
Deliveries. Landlord does not guaranty any mail or
deliveries to the Leased Premises and recommends Tenant arrange to receive
mail or deliveries at an alternate location. Any mail or
deliveries to and from the Leased Premises must be done only at such times
and in the areas and through the entrances designated for such purpose by
Landlord. Any mail or delivery left with the Store is done at
the Tenant’s sole risk. All property kept, stored, or
maintained on the Leased Premises by Tenant is at Tenant’s sole
risk.
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Tenant’s Advertising,
Promotion, and Media
Inquiries.
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A.
Tenant may use Landlord’s name only to the extent Landlord’s Leasing
Operations Department approves and only as a location
reference.
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B.
Tenant may not promote its services within the Store using Landlord’s
in-store public address system.
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C.
Tenant may not post any Signs outside of the Leased Premises, except as
provided in Section 2.6B, above, or post any hand made signs inside or
outside of the Leased Premises.
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D.
Tenant’s promotions related to the Leased Premises must be conducted in a
professional manner by trained
individuals.
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E.
Tenant may not release or cause to be released any statement to the press
or otherwise containing Landlord’s name or representing any relationship
whatsoever to Landlord, without the prior, written approval of the
Wal-Mart Leasing Operations
Department.
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F.
Tenant agrees that it will not, within the Leased Premises or anywhere
else in the Store, advertise, market, or promote any Competing
Business. For purposes of this paragraph, “Competing Business”
means any retail business, owned or operated by either Tenant or a third
party, involved in the sale, outside of the Store, of any products or
services sold from within the Store or by any affiliate, parent company,
or subsidiary of Landlord.
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6.9
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Restrictive
Covenants. Tenant shall comply with and observe any
easement, covenant, or restriction that affects or applies to the Leased
Premises and the Common Area.
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12
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Restrictions on
Tenant’s Activities. In addition to any easement,
covenant, or restriction that affects or applies to the Leased Premises or
the Common Area, Tenant, nor its Sublessees, shall
not:
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A.
Use the sidewalk adjacent to or any other space outside the Leased
Premises for display, sale, or any other similar
undertaking.
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B.
Use a loudspeaker system that may be heard from outside the Leased
Premises; place or permit any radio, television, loudspeaker, or amplifier
on the roof, inside the Leased Premises, or anywhere that the radio,
television, loudspeaker, or amplifier can be seen or heard from outside of
the Leased Premises; or solicit or distribute any handbills or other
advertising in the parking lot, Store, or Common Areas, unless otherwise
protected by law.
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C.
Use the plumbing facilities of the Leased Premises or the Store for any
purpose other than that for which they were
constructed. Neither Tenant or its Sublessees, nor the invitees
of either Tenant or its Sublessees, may use the plumbing facilities of the
Leased Premises to dispose of any foreign substances. The
expense of any breakage, stoppage, or damage resulting from a breach of
this paragraph will be born by
Tenant.
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D.
Place on any floor a load that exceeds the load per square foot that the
floor was designed to carry. Tenant may only install, operate,
and maintain heavy equipment in the Leased Premises if installed in such
manner as to achieve a proper distribution of
weight.
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E.
Use any forklift truck, tow truck, or any other machine or equipment in
the Store, in the Common Areas, or on any of the underlying ground, unless
necessary to complete Tenant’s obligations under Section 2.4 or unless
otherwise agreed to in the
Appendix-1.
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F.
Use the Leased Premises to conduct illegal business or for illegal
purposes or for any purpose that may increase the premium cost of or
invalidate any insurance policy carried on the Leased Premises, Common
Areas, or the Store. If insurance premiums for insurance
policies carried on the Leased Premises, Common Areas, or the Store
increase in connection with Tenant’s use of the Leased Premises, Tenant
will reimburse Landlord for the
increase.
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G.
Unreasonably interfere with Landlord’s business or the business of another
tenant of Landlord or act in such a way that reasonably may be expected to
injure Landlord’s business relationship including, but not limited to,
acting in any way which diminishes the access to or the visibility of any
portion of the Store or any other tenant’s premises or that impedes the
free circulation of customer traffic within the
Store.
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H.
Receive, retain, or store in the Leased Premises any “Controlled
Substances” except for any Controlled Substances included in an emergency
medical kit. For the purposes of this Master Lease, “controlled
substances” means materials containing any quantity of a substance with a
stimulant, depressant, hallucinogenic effect on the higher functions of
the central nervous system, and having the tendency to promote abuse or
physiological or psychological dependence, as designated in state and
federal controlled substance schedules including, but not limited to,
those listed in Schedules I through V of the Controlled Substances Act, 21
U.S.C. §812, as may be amended. Failure to comply with this
paragraph is a material breach.
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13
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I.
Within the Leased Premises, receive, retain, store, or use any firearm,
tear gas, ▇▇▇▇, pepper spray, dye pack, or any item similar to a firearm,
tear gas, or dye pack.
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6.11
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Encumbrances and
Liens. Tenant may not cause any encumbrance to attach to
or upon the Leased Premises, the Store, the Common Area, the land
underlying any of the foregoing, or Tenant’s interest in this Master Lease
because of any act or omission of Tenant, its contractors, agents,
employees, or representatives. Failure to discharge any
encumbrance within five (5) days following its filing is a material
breach. In addition to any right or remedy Landlord may have
for the material breach, Landlord may bond or pay the encumbrance for
Tenant’s account without inquiring into the validity of the
encumbrance. If Landlord elects to pay the encumbrance, Tenant
will reimburse Landlord, upon demand by Landlord, the amount Landlord
paid, plus an additional [***] administrative fee, plus
interest. Interest will accrue at the lesser of [***] or the
maximum amount allowed by law beginning on the day Landlord bonds or pays
the encumbrance and continuing until Tenant reimburses Landlord the entire
amount Landlord paid, plus the administrative fee and any interest
accrued.
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Article
VII
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Repairs
& Maintenance
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Repairs by
Landlord.
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B.
Tenant shall reimburse Landlord for any repairs necessitated by the
intentional acts or negligence of Tenant or Sublessee or the agents,
customer, employee, or representative of either. Any
reimbursement required in the preceding sentence must be made no later
than three (3) calendar days after Landlord demands reimbursement from
Tenant.
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C.
Landlord does not breach its obligations under Section, above, until a
reasonable amount of time passes after Tenant notifies Wal-Mart
Maintenance, according to Section, of the needed repair. Rent
will not ▇▇▇▇▇ during this time or while any repairs are being made, and
Landlord will not be liable to Tenant or Sublessee due to loss or
interruption of Tenant’s business because of the prosecution of the
repair.
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Tenant’s Repairs,
Maintenance, Handling Hazardous
Substances.
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A.
Tenant shall maintain the Leased Premises in compliance with applicable
law and in good order and condition. Tenant shall effect,
according to applicable law, all repairs to the Leased Premises (except
for those specifically enumerated in Section 7.1, above) that are
commercially necessary or desirable to maintain the Leased Premises in a
safe, dry, and tenantable condition including, without limitation, repairs
to:
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14
(1) Any portion of the pipes, lines, ducts, wires, or conduits, used solely by
Tenant;
(2) Plate
glass, windows, door frames, and special store fronts;
(3) Molding, locks and hardware, lighting, plumbing, Trade Fixtures, Signs, and
interior painting and treatment; and
(4) Any Improvements or Trade Fixtures installed in the Leased Premises,
including any roof-top heating, ventilation, or air conditioning unit or other
rooftop
equipment. Any repairs to the roof-top heating, ventilating,
and air conditioning unit or other rooftop equipment must be made by a Landlord
approved
contractor.
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B.
Tenant, at no expense to Landlord, shall handle, manage, store, transport,
and dispose of all Hazardous Substances (as defined below) created by any
process, action, or inaction in connection with the Leased Premises and in
accordance with all applicable law. Tenant shall not use any of
Landlord’s property or equipment in using, handling, managing, storing,
transporting, and disposing of Hazardous Substances. Evidence
of Tenant's compliance with all applicable laws concerning the use,
handling, management, storage, transportation, and disposal of Hazardous
Substances must be provided to Landlord on Landlord's
request. For the purpose of this Master Lease, “Hazardous
Substance” means:
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(1)
Hazardous material, hazardous waste, hazardous substance, toxic substance,
biomedical waste, infectious waste, medical waste, or toxic waste
identified by any federal or state law; chemical, dust, mixture, medical
device, pharmaceutical, or common material capable of causing harm; or
solid, liquid, contained gas, sludge, pollutant, asbestos, petroleum
product, polychlorinated biphenyls, unused or returned consumer product,
or other material, any of which, during the term of this Master Lease,
become regulated as a hazardous material, hazardous waste, hazardous
substance, toxic waste, or toxic substance;
or
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(2)
Any solid, liquid, contained gas, sludge, pollutant, asbestos,
polychlorinated biphenyls, or other material that, during the term of this
Master Lease, becomes prohibited or requires special handling or treatment
under any applicable law or regulation, including common
law.
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Landlord:
_____ Landlord: _____ Landlord:
_____ Landlord: _____ Tenant:
_____
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C.
Tenant, at no expense to Landlord, shall maintain the Leased Premises in a
clean and sanitary condition, free from debris or excessive odor, and in
compliance with all laws affecting the Leased Premises, Tenant’s use of
the Leased Premises, or Tenant’s
business.
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(1) Tenant shall not allow the accumulation or burning of any rubbish or garbage
in, on, or about the Leased Premises and shall keep all entrances, doors, or
loading areas in the Leased Premises or immediately adjoining
the Leased Premises free from trash, litter, or other obstruction.
(2) Tenant shall bear the expense of garbage and rubbish collection and
disposal. If Landlord’s Leasing Operations Department permits Tenant
to use any
part of the Store (other than the Leased Premises), Common
Area, or land underlying the foregoing, to store garbage and refuse generated by
Tenant’s
use of the Leased Premises, Tenant and its Sublessees, at the expense of Tenant
or its Sublessee, will keep all such
garbage and refuse in the location
designated by Landlord and in the kind of container, including the use of
interior refrigerated garbage containers and compactors, Landlord
specifies.
15
(3) Tenant will maintain air pressure in the Leased Premises necessary to keep
offensive odors from emanating from the Leased Premises.
(4) Any odor producing function of Tenant’s operations must be mechanically
vented to the exterior of the Store and the Leased Premises to eliminate the
dissipation
of such odors into the Store or into the interior or
exterior of any other tenant’s space. Exhaust hoods may not project
above the roof deck
higher than that allowed by local governmental authorities or code
requirements.
(5) At Landlord’s written request, Tenant will install any equipment or
procedures necessary to comply with Section 7.2C(3) and Section
7.2C(4). If Tenant
fails to comply with Landlord’s request, within ten (10) days
after receiving notice, Landlord may take remedial action for Tenant, and Tenant
will pay,
as Additional Rent, the cost of such remedial action plus an administrative
charge of [***] of the cost thereof.
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D.
If Tenant fails to pursue diligently any repairs required by this Section
within ten (10) days of receiving notice from Landlord of the
repair, Landlord may repair the Leased Premises as necessary to maintain
it in a good, clean, safe, dry, and tenantable condition. If
Landlord makes such repair, Tenant will reimburse Landlord for its costs,
plus an additional [***] administrative fee when Tenant pays the next
months Rent. Tenant will pay interest at the rate of [***] or
the maximum rate allowed under law, whichever is less, for any amount
unpaid after the next months Rent becomes
due.
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Store
Renovation.
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A.
Landlord, from time to time, may relocate the Store to another physical
address. If Landlord relocates the Store to another physical
address, Landlord, in its reasonable discretion, may terminate this Master
Lease as to the applicable Leased Premises but will not be liable for any
cost or expense of Tenant ceasing operations in the applicable Leased
Premises. Landlord and Tenant may enter into a new Attachment A
for the new location of the Store or any other Store. If
Landlord and Tenant enter into a new Attachment A for the new location or
the Store or any other Store, Tenant will bear all costs and expenses
incurred in relocating to the new location of the Store or to any other
Store. Tenant will also repair, update, and upgrade all Trade
Fixtures and Improvements to the Leased Premises and ready the newly
located Leased Premises to be open for business to the public for the
Store’s grand opening as required by this Master
Lease. Landlord must first approve all repairs, updates, and
upgrade to the Leased Premises.
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B.
Landlord, from time to time, may remodel, re-arrange, renovate, or expand
(collectively and individually “Store Renovations”) the Store, without
relocating the Store to another physical address. During Store
Renovations, Tenant will repair, update, and upgrade the Trade Fixtures,
the Improvements, and the Leased Premises unless Tenant repaired, updated,
and upgraded the Trade Fixtures, the Improvements, and the Leased Premises
within the three (3) consecutive preceding years. All repairs,
updates, and upgrades Tenant contemplates must be previously approved by
Landlord.
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16
(1) Landlord may either temporarily or permanently relocate Tenant within the
Store to another location within the Store that is of like size and
configuration
as the Leased Premises and is in a reasonable condition from
which Tenant may operate if Landlord, in its sole discretion, determines the
relocation necessary
to complete Store Renovations. Landlord will bear the cost of moving
Tenant’s Trade Fixtures in the event of a temporary
relocation, but Landlord is not
responsible for any expense associated with Tenant’s repairs, updates, and
upgrades of the relocated Leased Premises, whether the relocation is temporary
or
permanent. If the
relocation is of a permanent nature and Tenant reasonably determines that the
new location will materially impair its operations in the
applicable Leased Premises or is not of like size and configuration as
the original
Leased Premises, Tenant may terminate this Master Lease as to the
applicable
Leased Premises. If the relocation is temporary and Tenant reasonably
determines that the new location of the Leased Premises
will materially impair its business or that the Store Renovations are materially
impairing its operations in the Leased Premises, Tenant may, with Landlord’s
written
consent, close the applicable Leased Premises until Landlord
and Tenant agree that the Store Renovations no longer impair the operations of
the
applicable
Leased Premises.
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(2)
If, in connection with the Store Renovations, Landlord closes the Store
for more than three (3) consecutive days, Tenant may, with Landlord’s
written consent, either close the applicable Leased Premises while the
Store is closed in connection with the Store Renovations and conduct the
repairs, updates, and upgrades of the Leased Premises as required by this
Section 7.3B or terminate this Master Lease as to the applicable Leased
Premises.
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C.
If the Leased Premises closes in accordance with this Section, Rent due
during the time in which the Leased Premises is closed will
▇▇▇▇▇. The Leased Premises must re-open once the Store
Renovations and the operations of the Leased Premises no longer materially
impair each other, as determined by mutual agreement of the
parties.
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Article
VIII
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Compliance
with Law and Other Requirements
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Rules and
Regulations.
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Tenant
shall observe all rules and regulations established from time to time by
Landlord (as Landlord may adopt and publish in the Landlord/Tenant
Handbook) including, but not limited
to:
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A. Tenant
and Sublessee, and any agent, employee, or representative of either Tenant
or Sublessee, should remove immediately from the Store any merchandise
purchased from Landlord.
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(1)
Tenant and Sublessee, and any agent, employee, or representative of either
Tenant or Sublessee, may not bring into the Leased Premises any
merchandise purchased from Landlord unless the merchandise is purchased
for use by Tenant and Sublessee, and any agent, employee, or
representative of either Tenant or Sublessee, in the operation of its
business in the Leased Premises or unless the merchandise is purchased for
immediate consumption by Tenant, or its Sublessee, or any agent, employee,
or representative of either Tenant or
Sublessee.
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17
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(2)
Tenant and Sublessee, and any agent, employee, or representative of either
Tenant or Sublessee, must keep a receipt for the merchandise purchased
with the merchandise at all times while the merchandise is in either the
Leased Premises or the Store.
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(3)
No merchandise for which Tenant or Sublessee, or any agent, employee, or
representative of either Tenant or Sublessee, has not paid may be removed
from the Store or brought into the Leased
Premises.
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(4)
Any purchase by Tenant and Sublessee, and any agent, employee, or
representative of either Tenant or Sublessee, is subject to search
according to Landlord’s security procedures applicable to other customers
of Landlord. Any one removing, or involved in the removal of,
merchandise, either from the Store or into the Leased Premises, without
first paying for the merchandise may be trespassed from the Store or all
of Landlord’s property, may be treated as a shoplifter, or
both. Shoplifters may be subject to
prosecution.
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B. Tenant
and Sublessee, and any agent, employee, or representative of either Tenant
or Sublessee, shall conduct him or herself while in the Store or in the
Leased Premises in a professional and courteous manner, appropriately
attired, trained, and groomed, and consistent with the first-class
operations and facilities of
Landlord.
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C.
Landlord’s procedures in responding to media inquiries as such inquiries
relate to the Leased Premises, Landlord, or any relationship between
Tenant and Landlord.
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Compliance.
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A.
Tenant shall comply with all federal, state, and local laws, rules,
orders, directives, and regulations pertaining to its operations within
the Leased Premises including, but not limited to and as amended, the Age
Discrimination in Employment Act of 1967, 29 U.S.C. §621, et seq.; the
Americans with Disabilities Act of 1990, 42 ▇.▇.▇. §▇▇▇▇▇, et seq.; the
Child ▇▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇. §▇▇▇, et seq.; the Civil Rights Act of 1964, et
seq.; the Economic Dislocation and Worker ▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇. §▇▇▇,
et seq.; the Employee Polygraph Act of 1988, 29 U.S.C. §2001, et seq., the
Equal Pay Act of 1963, 29 U.S.C. §201, et seq.; the Fair Labor Standards
Act of 1938, 29 U.S.C. §201, et seq.; the Family and Medical Leave Act of
1993, 29 ▇.▇.▇. §▇▇▇▇, et seq.; the Immigration Reform and Control Act of
1986, 8 U.S.C. §1324a, et seq.; the Older Worker Benefit ▇▇▇▇▇▇▇▇▇▇ ▇▇▇,
▇▇ ▇.▇.▇. §▇▇▇, et seq.; and the Omnibus Budget Reconciliation Act of
1986, 29 U.S.C. §623, et seq.; and all other applicable laws, statutes,
and regulations.
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B.
Landlord has absolutely no responsibility, obligation, or liability for
Tenant’s hiring and other employment practices. Tenant warrants
and represents that it has a policy
to:
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(1)
Comply in all respects with all immigration laws and
regulations;
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18
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(2)
Properly maintain all records required by the United States Citizenship
and Immigration Services (the "USCIS") including, without limitation, the
completion and maintenance of the Form I-9 for each party's
employees;
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(3)
Respond in a timely fashion to any inspection requests related to such I-9
Forms;
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(4)
Cooperate fully in all respects with any audit, inquiry, inspection, or
investigation the USCIS may conduct of such party or any of Tenant's
employees;
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(5)
Conduct annual audit of the I-9 Forms for its employees;
and
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(6) Promptly
correct any defects or deficiencies the audit
reveals;
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(7)
Require all subcontractors performing any work for Tenant to comply with
the covenants set forth in this Section
8.2B.
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C.
With respect to its business operations in the Leased Premises, Tenant
shall comply with the Comprehensive Environmental Response, Compensation
and Liability Act, the Superfund Amendment and Reauthorization Act, the
Resource Conservation Recovery Act, the Federal Water Pollution Control
Act, the Federal Environmental Pesticides Act, the Clean Water Act, any
federal, state, or local “Superfund” or “Super Lien” statute, or any other
statute, law, ordinance, code, rule, regulation, order , or decree,
including any amendments thereto, regulating, relating to, or imposing
liability (including strict liability), or standards of conduct concerning
any Hazardous Substance or any escape, seepage, leakage, spillage,
emission discharge, or release of any Hazardous Substance or material
resulting from Tenant’s use, handling, management, storage, transportation
and disposal of any Hazardous Substance in, about, or under the
Store.
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D.
Tenant shall comply with the provisions of the Americans with Disabilities Act
(“ADA”) in complying with its obligations under this Master Lease.
(1) If, after Landlord delivers to Tenant the applicable Leased Premises, the
presence of any ADA violation on the applicable Leased Premises requires
remedial work on the Leased Premises, Tenant will promptly take all
actions at its sole expense as are required by any federal, state, or local
government agency or political subdivision to comply with the ADA; provided that
Landlord's consent to such actions is first obtained,
which consent
Landlord may not unreasonably withhold or delay.
(2) In addition to Tenant’s obligations under Article XIII, Tenant shall
indemnify, defend and hold harmless the Indemnitees from any Claim including,
without limitation, diminution in value of the Leased
Premises, damages
for the loss or restriction of use of rentable or usable space or of any
amenity of the Leased Premises, damages arising from any adverse impact on
marketing of space of the Leased Premises, and sums paid
in settlement of claims, attorney's fees, consultation fees and expert fees
arising during or after the applicable Lease Term as a result of such
violation.
Tenant’s obligations in the preceding sentence include, without
limitation, costs incurred in connection with any investigation of site
conditions
or any remedial work required by any federal, state, or local government agency
or political subdivision because of any ADA violation
present on or
about the Leased Premises.
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E.
Tenant represents and warrants that neither it nor its Sublessees
are:
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(1)
A person or entity designated by the U.S. Government on the list of the
Specially Designated Nationals and Blocked Persons (the “SDN List”), as
maintained by the U.S. Treasury Department’s Office of Foreign Assets
Control (“OFAC”) at ▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇▇/▇▇▇▇▇▇▇▇▇▇▇/▇▇▇▇/▇▇▇,
with which a U.S. person or entity cannot deal with or otherwise engage in
business transactions;
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(2)
A person or entity who is otherwise the target of U.S. economic sanctions
and trade embargoes enforced and administered by OFAC, such that a U.S.
person or entity cannot deal or otherwise engage in business transactions
with such Tenant or its Sublessees;
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(3)
Either wholly or partly owned or wholly or partly controlled by any person
or entity on the SDN List, including without limitation by virtue of such
person being a director or owning voting shares or interests in an entity
on the SDN List;
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(4)
A person or entity acting, directly or indirectly, for or on behalf of any
person or entity on the SDN List;
or
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(5)
A person or entity acting, directly or indirectly, for or on behalf of a
foreign government that is the target of the OFAC sanctions regulations
such that the entry into this Master Lease would be prohibited under U.S.
law.
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F.
Tenant shall inquire diligently into and screen the
qualifications of each employee, agent, or representative operating
out of the Leased Premises, and no one that may pose a reasonably
ascertainable risk to the safety or property of Wal-Mart or its
Associates, customers, or business invitees is permitted on Wal-Mart
property. For purposes of this paragraph, "inquire
diligently into and screen" means conducting a criminal background
check in accordance with federal and state law, properly checking
references, and using such other methods to determine qualifications
that a reasonable and prudent employer might utilize under the
circumstances. Also, “risk” means any propensity to engage
in violence, sex crimes, fraud, theft, vandalism, or any other conduct
likely to result in harm to a person or property. Failure to
comply with this provision constitutes a material breach of this Master
Lease.
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G.
Tenant shall maintain the warranties and representations Tenant made under
this Master Lease, all of which are remade and reaffirmed by Tenant when
signing each new Attachment A, in full force and effect throughout the
term of this Master Lease.
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H.
Any failure by Tenant to comply with its obligations under this Section
8.2 is a material breach.
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8.3
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Landlord’s Right of
Removal. Landlord, in its sole judgment and discretion,
may deny entry to or remove from its premises any Tenant or Sublessee, or
any agent, employee, or representative of either Tenant or Sublessee, who
violates any of Landlord’s rules or
regulations.
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Article
IX
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Right
to Access & Common Areas
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9.1
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Landlord’s Right to
Access. Landlord may enter the Leased
Premises:
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A.
Without notice to either inspect the Leased Premises, enforce any of
Landlord’s rules and regulations, enforce a provision of this Master Lease
or in case of an emergency;
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B.
Upon reasonable notice to Tenant, either to affect repairs it is obligated
to perform or to add, alter, improve, repair, or otherwise construct or
maintain any part of the Store adjacent to the Leased Premises;
and
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C.
With twenty four (24) hours advance notice to Tenant to show the Leased
Premises to a prospective lender, lessee, or
purchaser.
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9.2
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“For Rent” or “For
Lease”. Landlord may post “For Rent” or “For Lease”
signs on the Leased Premises during the last ninety (90) days of the
Leased Term if, in accordance with this Master Lease, Landlord
and Tenant do not extend the Lease
Term.
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9.3
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Tenant’s Right to
Access.
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A.
Tenant, its Sublessee, and the agent, customer, employee, or
representative of each, has a limited right, during the Hours of Operation
listed in Appendix-1, to enter upon the Common Areas of the Store in order
to conduct business in the Leased
Premises.
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B.
Except as set forth in Article II and Article VII, Tenant has no rights or
obligations related to the rooftop of the Leased
Premises.
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C.
Tenant, with Landlord’s prior consent, may enter Landlord’s property for
the limited purpose of servicing, maintaining, and otherwise performing
its obligations in connection with this Master Lease at times the Store is
not open to the public for business if Tenant, in no way, provides its
services to the public during that
time.
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9.4
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Parking. Tenant,
its Sublessee, and the agents, employees, and representatives of each,
while working in the Leased Premises, may park their motor vehicles in
spaces designated by Landlord. Landlord may tow or cause to be
towed, at the expense of the owner of the motor vehicle, any motor vehicle
owned by Tenant, its Sublessee, or the agents, employees, and
representatives of each, that is parked in any area of Landlord’s property
other than the parking area
designated.
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9.5
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Landlord’s
Liability. If Landlord enters the Leased Premises
according to the provisions of this Master Lease, Landlord is not liable
to Tenant for any loss, liability, or damages resulting from Landlord’s
entry. If Landlord enters the Leased Premises during the Hours
of Operation, Landlord will use commercially reasonable efforts not to
interfere with Tenant’s business, and Landlord will not be liable to
Tenant for any loss, including lost profits, for any resulting business
interruption.
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9.6
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Common
Areas. Despite the preceding Sections, Landlord may
close or prohibit the use of any Common Area, in part or in whole; may
change the location or appearance of the Common Area; or may erect
additional structures in the Common
Area.
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Article
X
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Transfer
of Interest, Subordination,
Attornment
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21
10.1 Transfer of Tenant’s
Interest. For the purposes of this Master Lease, “Affiliate”
means a corporation related to Tenant by shareholdings or any other means of
control; a subsidiary of Tenant; Tenant’s parent
company; or a sibling company of Tenant. Except to an Affiliate known
to Landlord at the time Landlord signs this Master Lease Agreement:
A.
Tenant may not, without the prior, written consent of Landlord, which Landlord
will not unreasonably withhold:
(1)
Transfer, encumber, or pledge (collectively and individually, “Transfer”) its
interest in this Master Lease, either in its entirety or as to a particular
Leased Premises, or an applicable Leased Premises;
(2) Permit
any Transfer or interest of this Master Lease by operation of law;
(3) Permit
any person or entity other than Tenant to use the Leased Premises;
or
(4) Cause
or permit Tenant’s dissolution, merger, or consolidation, unless Tenant is
merging or consolidating with an Affiliate.
B.
Tenant shall notify Landlord, in writing, prior to or simultaneously with, a
public announcement of the Transfer within any twelve (12) month period of
either more than an aggregate of fifty percent (50%) of Tenant’s voting
shares or more than fifty percent (50%) of the value of Tenant’s unencumbered
assets (as of the date of the Transfer); or the Transfer of any part or all of
its shares of stock resulting in a change in Tenant’s present effective voting
control by the person owning a majority of said shares of stock on the day
Tenant signs this Master Lease. If a Transfer occurs, Landlord, in
its sole discretion, may terminate this Master Lease in its entirety by
providing written notice to Tenant within ninety (90) days following receipt by
Landlord of Tenant’s notice as required above. Tenant’s failure to
provide Landlord notice as required above constitutes a material breach of this
Master Lease.
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10.2
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Effect of Unauthorized
Transfer. Subject to the exceptions in Section 10.1, any
Transfer or attempted Transfer without Landlord’s prior, written consent
will be void and will not confer any rights upon any third
person.
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10.3
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Requesting Landlord’s
Consent.
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A.
Any request for Landlord’s consent pursuant to this Article X must be in
writing and include:
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(1) The
proposed effective date of the Transfer, which should not be less than forty
five (45) days nor more than one hundred eighty (180) days in advance of the
notice;
(2) All
of the terms, including the consideration, of the proposed Transfer, the name
and address of the proposed transferee, and a copy of all documentation
pertaining to the proposed Transfer; and
(3) The
current audited financial statements of the proposed transferee or any other
financial statements that would enable Landlord to determine the financial
responsibility, character, and reputation of the proposed
transferee.
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B.
Tenant shall provide any additional information Landlord requests in
connection with the proposed
Transfer.
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10.4
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Effect of
Consent.
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A.
If Landlord consents to any Transfer, that consent is not effective until
and unless:
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(1) Landlord
receives a copy of the assignment affecting the Transfer
and
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(2)
The transferee delivers to Landlord a written agreement, in form and
substance satisfactory to Landlord, by which the transferee assumes all of
the obligations and liabilities of Tenant under this Master
Lease.
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B.
Any consent by Landlord to a Transfer does not constitute a waiver by
Landlord of any prohibition against any future
Transfers.
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C.
No Transfer relieves Tenant of any obligations under this Master
Lease.
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10.5
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Transfer
Premium.
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A.
For the purposes of this provision, “Transfer Premium” means all Rent or
other consideration payable by the Transferee in any monthly period that
is in excess of the Rent payable by Tenant under this Master Lease in the
same monthly period.
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B.
Tenant promptly, without notice or demand, shall pay Landlord [***] of any
Transfer Premium Tenant receives in connection with a
Transfer.
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C.
Tenant shall pay Landlord, in a form satisfactory to Landlord, any part of
the Transfer Premium Tenant receives in a non-cash
form.
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D.
In lieu of accepting any payment from Tenant of a Transfer Premium,
Landlord may elect, with ninety (90) days written notice, to increase the
Rent due under this Master Lease as to the transferred Leased Premises by
an amount equal to Landlord’s share of the monthly amount of the Transfer
Premium.
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E.
Landlord and its authorized representatives have the right to conduct an
audit, relating to any Transfer Premium, of Tenant at Tenant’s place of
business during Tenant’s regular work hours and with reasonable
notice. If the audit establishes that Tenant underpaid Landlord
Landlord’s percentage of the Transfer Premium, Tenant, within thirty (30)
days following receipt of written demand, will pay the deficiency and
Landlord’s costs of such audit. If the deficiency is greater
than [***], Landlord may terminate this Master Lease as to the transferred
Leased Premises. If the audit establishes that Tenant overpaid
Landlord Landlord’s percentage of the Transfer Premium, Landlord, within
thirty (30) days following receipt of written demand by Tenant, will pay
the overage.
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F.
This provision does not apply to:
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(1)
Any Transfer between Affiliates,
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(2)
Payments made by a transferee for Tenant’s customer deposits,
or
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(3)
Tenant’s furniture, fixtures, and
equipment.
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10.6
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Transfer of Landlord’s
Interest.
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A.
Landlord may Transfer all or a part of its interest in the Store, the
Common Areas, or the Leased Premises to a parent, subsidiary, or
affiliated corporation of Landlord without prior consent or notice to
Tenant.
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B.
If Landlord Transfers its interest in this Master Lease as to a Leased
Premises and the transferee assumes all of Landlord’s future obligations
under this Master Lease, Landlord will be released from any further
obligations under this Master Lease as to the transferred
interest. Tenant agrees to look solely to Landlord’s transferee
for performance of obligations under this Master
Lease. Landlord will transfer to the transferee any security
given by Tenant according to Section 4.6, and Landlord will be discharged
from any further obligation relating to the
security.
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10.7
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Subordination. Landlord
may elect that this Master Lease, as to a particular Leased Premises, be
subordinate to or paramount to the lien of any
mortgage. Landlord’s right to elect is self-operative, and no
further instrument will be required. If Landlord requests,
Tenant will do one or both of the
following:
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A.
Confirm in writing and in a recordable form that this Master Lease, as to
a particular Leased Premises, is subordinate to or paramount to (as
Landlord elects) the lien of any mortgage;
and
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B.
Execute an instrument making this Master Lease, as to the particular
Leased Premises, subordinate or paramount (as Landlord may elect) to the
lien of any mortgage, in a form as may be required by any applicable
mortgagee.
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10.8
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Attornment. Tenant
may not disaffirm any of its obligations under this Master Lease if
Landlord Transfers the Store or a particular Leased Premises to a
successor. Tenant will attorn to and be bound by the terms,
covenants, and conditions of this Master Lease as to the affected Leased
Premises for the balance of the Lease
Term.
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Article
XI
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Casualty
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Fire or Other
Casualty. Tenant shall promptly notify Landlord, in
writing, of any damage caused to a Leased Premises by
casualty.
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11.2
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Election to
Rebuild.
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A.
Landlord may elect to repair and restore structural damage to a Leased
Premises damaged by casualty and shall notify Tenant, in writing and
within at least sixty (60) days after Landlord receives notice of the
casualty damage, of its election.
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B.
If Landlord does not elect to repair and restore structural damage to a
Leased Premises damaged by casualty, this Master Lease as to the
applicable Leased Premises will
terminate.
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C.
If Landlord elects to repair the structural damage to a Leased Premises
damaged by casualty, Landlord, after notifying Tenant of its election,
will diligently undertake the appropriate measures necessary to complete
the repairs to the applicable Leased Premises in a commercially reasonable
amount of time. Landlord will return the applicable Leased
Premises to Tenant in substantially the same condition the applicable
Leased Premises was in on the Delivery Date. Tenant will then
complete the build-out of the applicable Leased Premises with commercially
reasonable diligence and return the applicable Leased Premises to
substantially the same condition the applicable Leased Premises was in
immediately prior to the casualty.
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24
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11.3
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Rent
Abatement. If Landlord elects to repair the structural
damage to a Leased Premises damaged by casualty, Landlord may ▇▇▇▇▇ Rent
due on the applicable Leased Premises to the extent that
the:
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A.
Applicable Leased Premises is closed for repair,
or
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B.
Tenant’s operations within the Leased Premises are impaired by the
structural damage and subsequent repairs.
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Article
XII
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Condemnation
& Eminent Domain
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12.1
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Total or Substantial
Taking. If a Taking of a Leased Premises, or a Store in
which exists a Leased Premises, occurs, this Master Lease as to the
applicable Leased Premises will terminate automatically as of the date of
the Taking. For purposes of this Master Lease, “Taking” means
any government action that deprives, directly interferes with, or
substantially disturbs the use and enjoyment of the Leased Premises, any
of which may occur because of either the exercise of the power of eminent
domain or condemnation or resulting from a purchase in lieu
thereof.
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12.2
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Partial
Taking. If a Taking of only a portion of the Leased
Premises, or of a Store in which exists a Leased Premises, occurs,
Landlord may either:
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A.
Terminate this Master Lease, without liability, as to the applicable
Leased Premises; or
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B.
Reduce the Base Rent in proportion to the area of the Leased Premises
affected by the Taking until such time that portion of the Store or the
Leased Premises is restored.
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12.3
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Temporary
Use. If a Taking of the Leased Premises occurs for
temporary use, this Master Lease will continue in full force and effect as
to the applicable Leased Premises. Tenant will continue to
comply with its obligations under this Master Lease, and any appendix,
amendment, or attachment hereto, to the extent compliance is possible
because of the Taking for temporary use. If during the
temporary Taking, Tenant is unable, based on a commercially reasonable
standard, to operate its business from the Leased Premises such that
Tenant reasonably is unable to open the Leased Premises for business,
Landlord will reduce Tenant’s Rent in proportion with the number of days
the Leased Premises is closed during the temporary
Taking.
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12.4
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Compensation. Any
compensation arising out of the Taking of a Leased Premises belongs to and
is the property of Landlord without any participation by
Tenant. Tenant hereby assigns to Landlord any share of any
compensation arising out of the Taking of a Leased Premises that may be
awarded to Tenant and waives any rights it may have with respect to the
loss of its leasehold
estate.
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25
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Article
XIII
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Indemnity
and Liability
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Definitions. For
the purposes of this Master Lease:
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(1)
Landlord, its subsidiaries, affiliates, officers, directors, employees,
agents, and
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(2)
Any lessor of Landlord or other party to an agreement with Landlord
related to Landlord’s purchase or lease or use of the Store or the
underlying land, which Landlord has a contractual obligation to indemnify
for Claims in connection with the Store or the Leased
Premises.
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C.
“Indemnified Claim” means a Claim for which Tenant is obligated to
indemnify, defend, and hold harmless the Indemnitees according to Section
13.2, below.
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Indemnification. Tenant
shall indemnify, defend, and hold harmless the Indemnitees against any
Claim, even if the Claim is groundless, fraudulent, false, or
raised or asserted by a third party, including a government entity, in
connection with or resulting from:
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A.
Any actual or alleged breach of this Master Lease by Tenant or Sublessee,
or any agent, employee, or representative of either Tenant or
Sublessee;
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B.
Any actual or alleged negligence or willful misconduct by Tenant or
Sublessees, or their respective agents, employees, representatives,
subcontractors, or customers, at or related to the Leased
Premises;
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C.
An investigation of the Indemnitees concerning the alleged improper
management, handling, storage, disposal, or transportation of Hazardous
Substances, any of which Tenant is responsible for under this Master Lease
and the actual or alleged improper use, handling, management, storage,
transportation, and disposal of Hazardous Substances by Tenant, Sublessee,
or any agent, employee, or representative of either Tenant or Sublessee;
and
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D.
Indemnitees actual or alleged passive negligence, secondary liability,
vicarious liability, strict liability, or breach of a statutory or
non-delegable duty, related, directly or indirectly, to any matter covered
under Section 13.2 of this Master
Lease.
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13.3
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Scope of
Indemnity. Tenant’s obligations under this Article
XIII:
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A.
Is independent of, and not limited by, any of Tenant’s obligations under
Article XIV, below, even if damages or benefits are payable under worker’s
compensation or other statutes or if Tenant breaches its obligations under
Article XIV, below.
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B.
Survive the termination or expiration of this Master Lease until
applicable law fully and finally bars all Claims against the
Indemnitee. ALL OBLIGATIONS UNDER THIS ARTICLE XIII WILL BE
ENFORCED TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW FOR THE BENEFIT
OF THE INDEMNITEES. In the event that applicable law affects the validity
or enforceability of this Article XIII, that applicable law will operate
to amend this Article XIII to the minimum extent necessary to bring the
provisions of this Article XIII into conformity with the applicable
law. This Article XIII, as modified, will continue in full
force and effect.
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26
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C.
Applies unless and until a final judicial decision, from which there is no
further right to appeal, determined that the Indemnitee is not entitled to
be indemnified, defended, and held harmless under this
Agreement.
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13.4
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Defense of
Claim.
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A.
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A.
On receiving notice, from whatever source, of the Indemnified Claim,
Tenant shall:
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(1)
Promptly notify Landlord of the assertion, filing, or service of any
Indemnified Claim of which Tenant becomes aware;
and
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(2) Immediately
take all appropriate actions necessary to protect and defend theIndemnitees
regarding the Indemnified Claim.
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B.
Tenant shall cause the counsel engaged to defend the Indemnitees with
respect to the Indemnified Claim to acknowledge receipt of, to accept, and
to represent Indemnitees’ interest regarding the Indemnified Claim in
accordance with “Wal-Mart’s Indemnity Counsel
Guidelines.”
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C.
If, in its sole discretion, the Indemnitees determine that a conflict of
interest exists between the Indemnitees and the indemnifying counsel or
that the indemnifying counsel is not pursuing a defense for the
Indemnitees that is in the Indemnitees’ best interests, the Indemnitees
may request Tenant replace the indemnifying
counsel.
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(1) Tenant shall not unreasonably withhold its consent to replace the
indemnifying counsel and will replace the indemnifying counsel timely or cause
the indemnifying counsel to be replaced timely.
(2) If Tenant unreasonably withholds consent or the indemnifying counsel is not
timely replaced after the Indemnitees requested, the Indemnitees may replace the
indemnifying counsel, and Tenant will reimburse
the Indemnitees any costs incurred by the Indemnitees in replacing the
counsel.
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13.5
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Waiver. Tenant
waives any right, at law or in equity, to indemnity or contribution from
the Indemnitees.
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13.6
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Non-liability of
Landlord and Tenant.
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A.
Landlord will not be liable to Tenant or Sublessee, or any agent,
employee, representative, or customer of Tenant or Sublessee, and Tenant
will not be liable to Landlord, for any Claim relating to the negligence
or willful misconduct of any of Landlord’s customers, invitees, or other
lessees or sublessees or any customers or invitees of Landlord’s other
lessee and sublessees.
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27
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B.
Landlord will not be liable to Tenant for any Claim relating to the
condition of the Store, the Common Areas, or the Leased Premises in
connection with disrepair or defect in
any:
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(1)
Structural element of the Leased
Premises;
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(2)
Trade Fixtures, Improvements, wiring, or any of Tenant’s
installations;
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(3)
Back up of drains constructed or installed by Tenant;
or
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(4)
Gas, water, steam, electricity, grease, or oil, leaking, escaping, or
flowing, from any equipment, pipes, drains, wiring, Trade Fixtures, or
Improvements installed or maintained by
Tenant.
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13.7
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Breach of Article
XIII. Any failure by Tenant to comply with this Article
XIII is a material breach of this Master Lease, which does not relieve
Tenant of its obligations under this Article
XIII.
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Article
XIV
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Insurance
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14.1
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Insurance
Required. Tenant shall procure and maintain, at Tenant's
own expense, the insurance policies described in the attached
Appendix-2. All insurance policies required by this Master
Lease must be obtained from an insurance company with a rating of A+ or
better and a financial Size Category rating of VII or better as rated in
the A.M. Best Key Rating Guide for Property and Casualty Insurance
Companies (“Insurer”), unless self-insured as discussed in Section 14.3,
below.
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Requirements.
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A.
Tenant and its Sublessees bear the responsibility of insuring for fire and all
risks, including risk of flood, earthquake, and terrorism, associated with the
merchandise, Trade Fixtures, and Improvements related to the operation of the
Leased Premises. At no time is Landlord liable for any Damage or
Injury to Tenant’s business property, Improvements, betterments, or Trade
Fixtures within any of the Leased Premises due to fire or any other risk covered
under a Causes of Loss – Special Form insurance policy or due to flood,
earthquake, or terrorism.
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B.
Tenant shall submit to Landlord a Certificate of Insurance for each
insurance policy required under this Article XIV and the attached
Appendix-2 naming “Wal-Mart Stores, Inc.,
Attn: Asset Management, ▇▇▇▇ ▇.▇. ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇” as the Certificate
Holder. Additionally, each Certificate of Insurance
must:
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(1)
Be submitted to Landlord at the address provided in the preceding
sentence;
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(2)
Show the name and address of the
Insurer;
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(3)
Show the policy number and date(s) of coverage for each policy procured by
Tenant in satisfaction of its obligations under this Master
Lease;
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(4)
Include the name, address, telephone number, and signature of the
authorized person providing the Certificate of
Insurance;
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(5)
Verify the insurance coverage required in this Article XIV and the
Appendix-2;
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(6)
Where permitted by law, list as Additional Insureds Wal-Mart Stores, Inc.,
its Subsidiaries and its Affiliates, and the directors, officers,
shareholders, employees, agents, and representatives, and the respective
successors and assigns of each, and any party that Landlord has
a contractual obligation to indemnify in relation to Tenant’s use of the
applicable Leased Premises;
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(7)
Verify that Insurer waives subrogation in favor of Landlord and Landlord’s
affiliates and subsidiaries;
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(8)
Verify the insurance policies are primary, non-contributory, and not in
excess of any insurance the Additional Insured has available to it;
and
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(9)
Where permitted by law, provide coverage for punitive
damages.
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Self-Insured.
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A.
Landlord may accept self-insurance in lieu of the insurance policies set
forth in this Article XIV and the attached Appendix-2 if Tenant provides
to Landlord
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(1)
A copy of the Certificate of Authority to Self-Insure its Worker’s
Compensation obligations issued by the state(s) in which the Leased
Premises will be located and a copy of the state-issued letter approving
self-insurance for automobile liability, if required under this Master
Lease;
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(2)
Proof that Tenant’s net worth is at least ten (10) times the amount of
Commercial General Liability insurance required by this Master Lease;
and
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(3)
A copy of Tenant’s most recently audited annual financial statements, with
no negative notes, or the most recent Dun and Bradstreet
report.
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B.
If Landlord accepts self-insurance in lieu of the insurance policies set
forth in this Article XIV and the attached Appendix-2, Tenant hereby
agrees to the obligations of any endorsement or Certificate of Insurance
required under Section 14.2, above, and that may be required under any
appendix, amendment, or attachment hereto. Such obligations
become Tenant’s obligations under this Master
Lease.
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14.4
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Mutual Waiver of
Subrogation. Landlord and Tenant each hereby release the
other from all liability or responsibility to the other or to any other
party claiming through or under them by way of subrogation or otherwise or
for any loss or damage to property caused by casualty that is customarily
insured under a Causes of Loss – Special Form insurance policy or that is
due to flood, earthquake, or terrorism. This mutual waiver
applies only to Damage or Injury to Tenant’s business property,
Improvements, betterments, or Trade Fixtures within any of the Leased
Premises occurring during the time when Tenant’s business property,
Improvements, betterments, or Trade Fixtures within any of the Leased
Premises are covered under a Causes of Loss – Special Form insurance
policy or are due to flood, earthquake, or terrorism for which Tenant has
insurance coverage.
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14.5
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Breach. Failure
to procure and maintain the insurance required under this Article XIV and
the attached Appendix-2 constitutes a material breach of this Master
Lease. Tenant shall indemnify, defend, and hold harmless the
Indemnitee against Indemnified Claim that the required insurance would
have covered but for Tenant’s
breach.
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14.6
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Insurance Obligation
is in Addition to Other Obligations. Tenant’s
obligations under this Article XIV and the attached Appendix-2 are in
addition to, not in lieu of, Tenant’s other obligations, including
Tenant’s obligations under Article XIII, to Landlord under this Master
Lease.
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Article
XV
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Confidentiality
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15.1
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The
terms and provisions of this Master Lease affect present and future
negotiations Landlord or Tenant may have with another party. As
such, Landlord and Tenant, and the agents, employees, and representatives
of each, shall each keep confidential, disclosing only such information as
is required by law or by mutual, written agreement between Landlord and
Tenant.
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15.2
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Tenant
shall not disclose any information that Landlord may ▇▇▇▇ as confidential
or proprietary including, but not limited to, lists of available rental
space and marketing plans or schedules that Landlord may make available or
known to Tenant, disclosing only such information as is required by law or
by mutual, written agreement between Landlord and
Tenant.
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15.3
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Failure
to comply with this Article XV is a material breach of this Master
Lease.
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Article
XVI
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Covenant
of Quiet Enjoyment
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16.1
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Landlord
covenants that Tenant peaceably and quietly may enjoy the Leased Premises
in accordance with, and subject to, the terms of this Master Lease and
without any interruption or disturbance from Landlord, provided
Tenant:
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A.
Pays Rent and all other charges provided for in this Master Lease and any
appendix, amendment, or attachment
hereto,
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B.
Performs all of its obligations provided for under this Master Lease,
and
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C.
Observes all of the other provisions of this Master
Lease.
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Article
XVII
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Default,
Termination, Surrender, Tenant’s Liability, Right of
Reentry
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Tenant’s
Waivers, Landlord’s Right to Perform, Cumulative
Rights
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Default. Each
of the following events constitutes a Default of this Master
Lease:
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A.
Tenant files for Insolvency or is adjudicated Insolvent. For the
purposes of this Master Lease, “Insolvency” means any petition filed by Tenant
in bankruptcy, for reorganization or arrangement, or for appointment of a
receiver or trustee; Tenant acquiescing to a petition for bankruptcy,
reorganization, arrangement, or the appointment of a receiver or trustee by a
creditor; or any assignment by Tenant for the benefit of a
creditor.
30
B.
A petition for Insolvency is filed against Tenant, to which Tenant does not
acquiesce, and that, within five (5) days following the filing, is not
dismissed, discontinued, or vacated;
C. Tenant’s
interest in this Master Lease, in its entirety or as to a particular Leased
Premises is assigned by operation of law;
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D.
Tenant fails to pay any installment of Rent or any other charge to which
Tenant is obligated by this Master Lease to pay when due and payable, and
the failure to pay continues for more than ten (10) days and such failure
occurs more than two (2) times in a calendar year;
or
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E.
Tenant breaches any material obligation or covenant under this Master
Lease.
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F.
Tenant breaches any non-material obligation or covenant under this Master
Lease more than two (2) times in a calendar year, and each breach remains
uncured ten (10) days after Tenant receives written or verbal notice of
the breach from Landlord.
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G.
After the Rent Commencement Date, Tenant fails to open the applicable
Leased Premises according to the Hours of Operation designated in
Appendix-1 two (2) or more times in a calendar year, without Landlord’s
prior, written approval or as otherwise allowed under this Master
Lease.
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17.2
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Termination for
Default. Landlord may terminate this Master Lease, in
its entirety or as to a particular Leased Premises, without any liability,
if Tenant Defaults, as defined in Section 17.1, above, or elsewhere in
this Master Lease, by written notice to Tenant. However,
Landlord may wait to terminate this Master Lease, in its entirety or as to
a particular Leased Premises, until after it re-lets the Leased Premises
in accordance with this Article, and Tenant pays Landlord all sums due
Landlord under this Master Lease.
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Surrender at
Termination or Expiration. Unless otherwise provided in
Appendix-1, by the date on which this Master Lease as to the applicable
Leased Premises terminates, for whatever reason, Tenant shall immediately
surrender and quit the applicable Leased Premises and, in the two (2)
calendar days preceding the date on which this Master Lease terminates,
for whatever reason, shall remove all property, Trade Fixtures, and
Improvements from the Leased Premises and
either:
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A.
Return the Leased Premises to White Box condition,
or
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B. In
lieu of returning the Leased Premises to a White Box condition, pay
Landlord [***].
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Landlord’s Right of
Reentry. If Tenant fails to surrender the applicable
Leased Premises in accordance with this Article, Landlord, its agents,
employees, or representatives, without prejudice to any right or remedy
available to Landlord under this Master Lease, at law, or in equity and
subject to applicable law, may:
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31
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A.
Re-enter and repossess the applicable Leased Premises and do one or more
of the following:
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(1) Dispose of any property, Trade Fixtures, or Improvements remaining
therein.
(2) Relet the Leased Premises, and if Landlord relets the Leased Premises
for Rent and other charges equal to or greater than the Rent
and other charges for which Tenant remains liable, Tenant will be released
from further
liability under this Master Lease.
(3) Use all or a portion of the Leased Premises, in which case the fair
market value of the applicable Leased Premises, or the portion of that Leased
Premises
used, will be used in calculating Tenant’s liability described
in Section 17.5, below. If the fair market value equals or is greater
than the Rent and other charges
for which Tenant remains liable, Tenant will be released from further liability
under this Master Lease.
(4) Demand full and final settlement, whereupon Tenant shall pay Landlord
the present value of the total of all future Rent that would come due under this
Master Lease but for the termination of this Master Lease, plus
other charges that may apply under this Master Lease, less the fair market value
of the
particular Leased Premises. Present value will be calculated at
[***], at which time Tenant will be released from further liability
under this Master Lease.
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B.
Continue this Master Lease in full force and continue to look to Tenant to
perform all Tenant’s obligations under this Master Lease, but Landlord may
pursue Tenant for damages incurred or equitable relief or
both.
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17.5
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Survival of Tenant’s
Liability. Upon termination of this Master Lease, in its
entirety or as to a particular Leased Premises and without prejudice to
any right or remedy available to Landlord under this Master Lease, at law,
or in equity and subject to applicable law, Tenant remains liable
for:
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A.
Damages for its failure to pay Rent, and other
charges;
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B.
Damages for its failure to perform other
obligations;
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C.
Expenses Landlord incurs in the course of evicting Tenant and reentering
the Leased Premises, including reasonable attorneys fees and court costs;
and
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D.
Unless Tenant surrenders the Leased Premises in accordance with this
Article, any cost incurred by Landlord in returning the Leased Premises to
the same condition in which Tenant received the Leased Premises on the
Delivery Date, less any revenue received by Landlord by re-letting the
Leased Premises, less any claim Landlord successfully makes against the
Surety Bond required pursuant to Section
4.6.
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17.6
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Tenant’s
Waivers. Landlord and Tenant waive any
right to trial by jury on all issues in all litigation between Landlord
and Tenant arising from or relating to this Master Lease, and
Tenant, additionally, waives any:
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A.
Right to withhold or reduce Tenant’s required payments of Rent and other
charges for which Tenant is obligated under this Master
Lease;
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B.
Statutory requirements of prior, written notice before filing for eviction
or for any damages suit for non-payment of
Rent;
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C.
Claim for damages against Landlord resulting from Landlord’s
re-entry;
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D. Rights to bring any
counterclaim, proceeding, or other cause of action in relation to
dispossession; and
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E.
To the extent legally permissible, for itself and all persons claiming by,
through, or under it, any right of redemption or for the restoration of
the operation of this Master Lease under any present or future law in case
Tenant is dispossessed for any cause or in case Landlord obtains
possession of the Leased Premises as herein
provided.
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Landlord’s Right to
Perform for Account of
Tenant.
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If
Tenant Defaults under this Master Lease, Landlord may cure the Default at
any time for the account of and at the expense of Tenant, and Tenant will
reimburse Landlord for any amount, including reasonable attorneys fees and
interest, expended in connection
therewith.
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If
Landlord seeks enforcement of this Master Lease by litigation and
prevails, Tenant will reimburse Landlord for any attorneys’ fees and
disbursements reasonably incurred in connection with that
litigation.
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C.
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In
addition to all other obligations under this Master Lease, Tenant shall
pay interest to Landlord, at the maximum lawful rate, on the amount
specified in Sections 17.7A and 17.7B, from the date Landlord incurs the
expense until the day reimbursed.
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17.8
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Cumulative
Rights.
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A.
Landlord’s rights and remedies set forth in this Master Lease are
cumulative and in addition to any other right and remedy now and hereafter
available to Landlord by this Master Lease, at law or in
equity. Landlord may exercise its rights and remedies at any
time, in any order, to any extent, and as often as Landlord deems
advisable.
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B.
A single or partial exercise of a right or remedy will not preclude a
further exercise of that or another right or
remedy.
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C.
No action, inaction, delay, or omission by Landlord in exercising a right
or remedy exhausts or impairs the same or constitutes a waiver of, or
acquiescence to, a breach of this Master Lease or
Default.
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D.
If Landlord waives a breach of this Master Lease or a Default, that waiver
does not extend to or affect any other breach of this Master Lease or any
other Default nor will it impair any right or remedy with respect
thereto.
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E.
Acceptance by Landlord of Rent after Landlord notifies Tenant of
termination does not waive Landlord’s right to terminate or pursue any
other right and remedy available to Landlord under this Master Lease, at
law, or in equity.
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33
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17.9
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Landlord’s
Default.
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A.
Landlord’s failure to perform any of its obligations under this Master Lease may
constitute a default of this Master Lease, in its entirety or as to the
particular Leased Premises affected by Landlord’s failure to perform, if Tenant
notifies Landlord, in writing, of Landlord’s failure to perform, and Landlord
fails to cure the failure to perform within at least thirty (30) days after
Landlord receives Tenant’s notice or such longer period of time as may
reasonably be necessary to cure the type of alleged breach under the
circumstances. Notice required under this Section must include a
description of the particular facts and circumstances alleged giving rise to the
alleged breach and the date of commencement of the alleged breach.
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B.
If Landlord defaults on this Master Lease, Tenant, in addition to
any other rights or remedies to which it is entitled at law or in equity,
may:
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(1)
Treat this Master Lease as still in full force and effect continuing to
look to Landlord to perform its obligations under this Master Lease but
seek damages or equitable relief, or both;
or
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(2)
Terminate this Master Lease, in its entirety or as to the applicable
Leased Premises, with thirty (30) days written, notice stating the date on
which Tenant will vacate the Leased Premises. If Tenant fails
to timely vacate the Leased Premises, Tenant’s notice of termination will
be deemed to be void; the Master Lease, in its entirety or as to the
applicable Leased Premises, will continue in full force and effect, and
Landlord will be deemed to have cured any alleged
breach.
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C.
Regardless of which remedy Tenant pursues, LANDLORD’S LIABILITY FOR
DEFAULT UNDER THIS MASTER LEASE, AT LAW OR IN EQUITY, WILL NOT EXCEED AN
AMOUNT EQUAL TO ONE (1) YEARS RENT PAID BY TENANT FOR THE LOCATION IN
WHICH LANDLORD WAS FOUND IN
DEFAULT.
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17.10
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Force
Majeure. If a force majeure occurs,
the time that the force majeure delays performance by either Landlord or
Tenant will be excluded from the computation of time within which
Landlord, Tenant, or both, must perform under this Master
Lease. For purposes of this Master Lease, a force majeure is a
strike, riot, act of God, shortage of material, war, governmental law,
regulation, or restriction, or any other cause of any kind that is beyond
the reasonable control of the party owing
performance.
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Article
XVIII
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Holding
Over & Estoppel Certificates
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Holding
Over. If Tenant remains in possession of the Leased
Premises after the expiration of the Lease Term without a new Attachment A
or Master Lease executed by both Landlord and Tenant, Tenant will be a
“Holdover Tenant”. As a Holdover Tenant, Tenant will occupy the
Leased Premises on a month-to-month basis with a monthly rental rate equal
to the Rent and other charges applicable at the time of the expiration of
the Master Lease plus [***] of the sum of such
amounts. Further, Tenant will be subject to all conditions,
provisions, and obligations of this Master Lease as far as the same are
applicable to a month-to-month
tenancy.
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Estoppel
Certificates. Tenant, at Landlord’s request, shall
deliver to Landlord an executed, written, statement addressed to the party
designated in Landlord’s request and identifying Tenant and this Master
Lease and certifying and confirming, in addition to any information or
confirmation Landlord may reasonably require, the
following:
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34
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A.
That this Master Lease is either unmodified since its execution and in
full force and effect, or modified since its execution but still in full
force and effect as modified;
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B.
That Landlord either is not in default of any of its obligations under
this Master Lease or is in default, specifying the
default;
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C.
Tenant’s obligations and restrictions concerning subordination and
attornment; and
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D.
The Lease Term, Rent Commencement Date, and Expiration Date as to the
Leased Premises for which the estoppel certificate
applies.
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18.3
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Agent-in-Fact. Tenant’s
failure to provide an estoppel certificate materially complying with the
Section 18.2, above, is a material breach of this Master Lease through
which, in addition to any other right or remedy Landlord may have under
this Master Lease, at law, or in equity, Landlord is
hereby irrevocably appointed and authorized as the agent and
attorney-in-fact of Tenant to execute and deliver any such written
statement on Tenant’s behalf if Tenant fails to do so within seven (7)
days after receiving a written request from
Landlord.
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Article
XIX
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Interpretation,
Notices, & Miscellaneous
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19.1
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Severability. If
a court of proper jurisdiction determines that any provision of this
Master Lease, or any application of the provision, is invalid or
unenforceable, the remainder of this Master Lease, or the applications of
the provision that are not invalid or unenforceable, will remain in full
force and effect to the fullest extent permitted by
law.
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19.2
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Captions. The
captions and headings used throughout this Master Lease are for
convenience of reference only and do not affect the interpretation of this
Master Lease.
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19.3
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Merger. This
Master Lease, together with any Attachment A, exhibit, addendum,
amendment, or any other document attached to and incorporated into this
Master Lease, constitutes the entire agreement between Landlord and
Tenant, a complete allocation of risks between them, and a complete and
exclusive statement of the terms and conditions of this Master
Lease. This Master Lease is merged into by and supersedes all
prior written or oral agreements, leases, licenses, negotiations,
dealings, and understandings, unless specifically provided otherwise in
Appendix-1. Except for changes to the Delivery Window and
Delivery Date designated in the applicable Attachment A, no amendment or
other modification of this Master Lease will be valid or binding on either
Landlord or Tenant unless it is reduced to writing and signed by both
Landlord and Tenant.
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19.4
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Survival. The
following provisions of this Master Lease survive the termination, for
whatever reason, of this Master Lease: Article XIII, Article
XIV, Article XV, Article XVII, Section 2.4, Section 18.1, and
Appendix-2.
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35
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19.5
|
Third Party
Beneficiaries. Nothing in this Master Lease confers, or
intends to confer, any rights upon any person or entity not a party to
this Master Lease, except for the Indemnitees identified in Section 13.1B,
above.
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19.6
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Benefit & Binding
Effect. The terms, provisions, and covenants contained
in this Master Lease apply to, inure to the benefit of, and are binding on
Landlord and Tenant, and their respective heirs, successors, and
assignees.
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19.7
|
Fiduciary
Relationship. This Master Lease does not create a
fiduciary relationship between Landlord and Tenant. Any
expenditures, investments, or commitments Tenant makes in reliance on any
present or future business or lease with Landlord is done at Tenant’s own
risk and without any obligation whatsoever from
Landlord.
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19.8
|
No
Obligation. Landlord has no obligation to offer, nor
does the course of performance under this Master Lease create any
obligation on Landlord to offer, any number of locations for lease to
Tenant. Any locations offered for lease to Tenant in accordance
with this Master Lease are in the sole and absolute discretion of
Landlord. Landlord, in its sole discretion and at any time, may
cease offering locations to Tenant, and this Master Lease will continue in
full force and effect solely with regard to those Leased Premises for
which both Landlord and Tenant have signed an Attachment
A. Landlord may lease locations that Landlord might otherwise
offer to Tenant under this Master Lease to any party that Landlord chooses
including, without limitation, Tenant’s competitors. Tenant
recognizes and agrees that this Master Lease creates no exclusive rights
in Tenant’s favor.
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19.9
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Independent
Contractors. Nothing contained in this Master Lease
creates a partnership, joint venture, principal/agent relationship, or any
other relationship other than that of landlord/tenant between Landlord and
Tenant.
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|
Notice. Any
notice required by this Master Lease must be in writing and delivered
either by hand; by commercial courier; or by placing notice in the U.S.
mail, certified mail, return receipt requested, properly addressed and
with sufficient postage.
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A.
Notice is deemed received on:
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(1)
Delivery if by hand;
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(2)
One (1) business day (Monday through Friday) after deposit with the
commercial courier, provided deposit is done timely so as to effect next
business day delivery, if by commercial courier;
or
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(3)
Three (3) business days after placing the notice in the U.S. mail,
properly addressed and with sufficient postage for certified mail, return
receipt requested.
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B.
Notice intended for Tenant must be sent to the address provided in
Appendix-1.
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C.
Notice intended for Landlord must be sent to: Wal-Mart Stores, Inc., Asset
Management, ▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, with a copy to: Wal-Mart
Stores, Inc., Wal-Mart Stores Division – Legal, Office of the General
Counsel, ▇▇▇ ▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇.
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36
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19.11
|
Governing
Law. This Master Lease, and any property or tort
disputes between Landlord and Tenant, will be construed and enforced in
accordance with the laws of the State of Arkansas, without regard to the
internal law of Arkansas regarding conflicts of law. Neither
Landlord nor Tenant may raise in connection therewith, and hereby waive,
any defenses based on venue, inconvenience of forum, or lack of personal
jurisdiction, in any action or suit brought in accordance with the
foregoing.
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19.12
|
Jurisdiction and
Venue. For any suit, action, or legal proceeding,
arising from this Master Lease or from any property or tort dispute
between Landlord and Tenant, Landlord and Tenant consent and submit to the
exclusive jurisdiction and venue of the state courts of Arkansas situated
in ▇▇▇▇▇▇ County, Arkansas or the federal courts situated in the Western
District of Arkansas. Landlord and Tenant acknowledge
that they have read and understand this clause and willingly agree to its
terms.
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19.13
|
Attorney’s
Fees. Except as otherwise provided in this Master Lease,
if either party commences an action in a court of law against the other
party to enforce the terms of this Master Lease, to declare rights under
this Master Lease, or for any other reason related to this Master Lease,
each party will pay its own attorney’s fees and costs incurred as a result
of that action.
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[signature
page to follow]
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Signed:
Witness: Landlord: Wal-Mart
Stores, Inc.
_________________________ ___________________________________
Date
Wal-Mart Stores, Inc.
_________________________
Witness: Landlord: Wal-Mart
Stores East, LP
_________________________ ___________________________________
Date
Wal-Mart Stores East, LP
_________________________
Witness: Landlord: Wal-Mart
Stores Texas, LP
_________________________ ___________________________________
Date
Wal-Mart Stores Texas, LP
_________________________
Witness: Landlord: Wal-Mart
Louisiana, LLC
_________________________ ___________________________________
Date
Wal-Mart Louisiana, LLC
37
_________________________
Signed:
Witness: Tenant: Portrait
Corporation of America, Inc.
_________________________ ___________________________________
Signature Date
_________________________ _________________________
Printed Name
_________________________
Title
***Confidential
treatment requested.
CHI99 5003400-1.020242.0010
CONFIDENTIAL
TREATMENT REQUESTED FOR PORTIONS OF THIS DOCUMENT. PORTIONS FOR WHICH
CONFIDENTIAL TREATMENT IS REQUESTED ARE DENOTED WITH BRACKETS.
Appendix-1
Basic
Lease Terms
The following terms supplement the
terms and conditions set forth in the body of the Master Lease Agreement, to
which this Appendix-1 attaches and into which these Appendix-1
incorporates.
a.
During the Lease Term of the applicable Leased Premises, Tenant shall use the
Leased Premises solely for the purpose of operating a photography studio
offering the taking and selling of portrait photographs and related products;
the customization of portraits including oil portraits; the taking of passport
and citizenship photographs; the sale of picture frames and other portrait
accessories that do not compete with those that Landlord, from time to time,
sells in the Store; the sale of photographic plaques; the copying and
restoration of old photographs; the sale of portraiture related software and
digital images; and the provision and sale of photographic lamination services,
together with such services and merchandise that Landlord, from time to time and
in its sole and absolute discretion, may approve in writing.
b.
During the Lease Term of the applicable Leased Premises and other than as
permitted in the preceding paragraph, Tenant may not offer any additional
services or products, or change the use of the Leased Premises, without prior
written consent of Landlord’s Home Office Leasing Department, which such consent
may be withheld in Landlord’s sole and exclusive judgment.
c.
Commencing on the actual Rent Commencement Date of the applicable Leased
Premises and continuing until expiration or termination of this Master Lease in
its entirety or as to the applicable Leased Premises, and provided that Tenant
is not in Default (as defined in this Master Lease) as to the applicable Leased
Premises, Landlord may not lease to a tenant, other than Tenant, space inside
the applicable Store for the Primary Permitted Use (as defined in the following
sentence) of the operation of a photography studio. “Primary
Permitted Use” means that the tenant designates fifty per cent (50%) or more of
the retail floor area of the applicable Leased Premises for use in accordance
with this Master Lease. Tenant’s rights under this paragraph 1c
become null and void, and Tenant will lose all rights herein, if Tenant ceases
to use the applicable Leased Premises for the Primary Permitted Use of the
operation of a photography studio; if Tenant Defaults (as defined in this Master
Lease) as to the applicable Leased Premises; or if Tenant Transfers (as defined
in this Master Lease) this Master Lease, either in its entirety or as to an
applicable Leased Premises, or its rights or interests in this Master Lease, or
sublets all or any portion of any Leased Premises Tenant leases under this
Master Lease.
d.
If Landlord breaches paragraph 1c, above, this paragraph 1d governs Tenant’s
sole remedy at law or in equity, and in no event will Landlord be liable to
Tenant for any damages even if actual, compensatory, or
consequential.
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(1)
Tenant, within thirty (30) days following Tenant’s receipt of any facts
giving rise to the alleged breach, shall notify Landlord, in writing, of
the alleged breach describing with particularity the facts and
circumstances giving rise to the alleged breach and the date of
commencement of the alleged breach.
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(2)
If Landlord fails to cure the alleged breach within at least ninety (90)
days following Landlord’s receipt of notice in accordance with the
preceding paragraph, Tenant may terminate this Master Lease as to the
applicable Leased Premises with at least sixty (60) days written notice to
Landlord stating the date on which Tenant will vacate the applicable
Leased Premises. If Tenant fails to timely vacate the
applicable Leased Premises, Tenant’s notice of termination will be deemed
void; this Master Lease as to the applicable Leased Premises will continue
in full force and effect, and Landlord will be deemed to have cured any
alleged breach of paragraph 1c, above. Other than the right to
seek specific performance for Landlord’s breach of paragraph 1a, above,
Tenant waives any right it may have available to it at law or in equity
for any Claim (as defined in this Master Lease) resulting from Landlord’s
alleged breach of paragraph 1,
above.
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e.
Despite the preceding paragraph, the following actions do not constitute a
breach of this Master Lease by Landlord:
(1)
Sales, marketing, and promotions by Landlord or any of Landlord’s affiliates,
subsidiaries, officers, directors, employees, or agents, of any photographic
services or products including, but not limited to, frames,
accessories, and film; and
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(2)
Sales of one-hour photography developing products and services and the
taking and sale of passport pictures by any other tenant in the store
whose leases pre-date this Master
Lease.
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f.
Tenant shall not sublet the applicable Leased Premises to a
Sublessee. Tenant shall not permit any business or other operation to
be conducted in the Leased Premises, other than the Permitted Uses designated in
paragraph 1a, above, which must only be performed by Tenant.
g.
Landlord will use commercially reasonable efforts to include Tenant on the
blueprints for store expansions if Tenant is already leasing space in the Store
being expanded.
2.
Leased Premises
Specifications.
a.
Tenant, at its sole cost and expense, shall install, provide, and maintain all
equipment necessary for the operation of its Permitted Uses, as described in
paragraph 1a above, including, but not limited to, any equipment required by any
professional standards, law, rule, or regulation applicable to Tenant’s
business. To the extent that the installation, provision, or
maintenance of the equipment requires alteration of the Leased Premises that is
not located in a newly constructed Store, Tenant shall comply with the terms of
Article II of this Master Lease.
b.
If Landlord terminates a Leased Premises as a result of Store Renovations,
Tenant shall surrender the applicable Leased Premises as required in Section
17.3 of the Master Lease Agreement and shall remove all property, Trade
Fixtures, and Improvements from the Leased Premises and either return the Leased
Premises to Landlord in broom clean condition or pay Landlord
[***].
c.
Tenant’s obligations under this Section 2 are in addition to, and not in lieu
of, Tenant’s obligations to prepare the Leased Premises in accordance with
Article II of this Master Lease.
Picture Me
As
required by ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇, Tenant shall rebrand its trade name and, in
connection therewith, remove the “Wal-Mart” name from all of Tenant’s signage
and materials no later than January 31, 2008. Until that time, or
such earlier date that Tenant’s right to use the “Wal-Mart” name terminates,
Tenant may conduct its operations under either of the trade names listed above,
provided that any usage of the “Wal-Mart’ name is consistent with the other
requirements of this Master Lease.
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Name
of Tenant:
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Portrait
Corporation of America, Inc.
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Attention:
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C.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Title:
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Chairman,
President & CEO
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Address:
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▇▇▇
▇▇▇▇▇▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Telephone
Number:
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(▇▇▇)
▇▇▇-▇▇▇▇
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Facsimile
Number:
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(▇▇▇)
▇▇▇▇-▇▇▇▇
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Email
Address:
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N/A
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With
Copy To:
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J.
▇▇▇▇▇▇ ▇▇▇▇, ▇▇.
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▇▇▇
▇▇▇▇▇▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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6.
Advisements. [Intentionally
Omitted]
7.
Covenants,
Representations, and Warranties.
a.
Tenant covenants to promptly inform Landlord of the resignation or termination
of its Chief Executive Officer, Executive Vice-President of Studio Operations,
or both. Landlord shall have the right to approve, in its sole and
absolute discretion, any successor that Tenant proposes to appoint to any of
such offices. Tenant shall submit to Landlord the resume of any such
proposed successor officer and shall arrange a meeting between such proposed
successor officer and Landlord. Landlord shall use commercially
reasonable efforts to meet with such proposed successor within five (5) business
days (Monday through Friday) following its receipt of Tenant’s request and shall
either approve, which such approval may not be unreasonably withheld, or
disapprove of the proposed successor within three (3) business days (Monday
through Friday) following such personal meeting.
(1) If Landlord waives the personal meeting required in the preceding paragraph,
Landlord will base its approval or disapproval of the change on the proposed
replacement’s resume provided to Landlord by Tenant.
(2) Despite anything to the contrary elsewhere in this Master Lease,
Landlord’s approval is not required with respect to any proposed successor
officer if the
proposed successor officer has at least five (5) years experience
as the Chief Executive Officer, President, or Chief Operating Officer of a
retail chain that
experienced positive sales and income growth for a minimum of three (3) out of
the last five (5) years during which the proposed
successor officer held
such office, that accrued annual sales of at least [***], and that consists of
at least [***] stores, provided that the proposed successor officer has not
been convicted of a felony nor has been
terminated from such a position for poor performance.
b.
Tenant covenants that in the event of a Change in Control (as defined below),
Tenant shall advise Landlord in advance of the proposed Change in Control, and
Landlord will have five (5) business days (Monday through Friday) to approve,
which such approval may not be unreasonably withheld, or disapprove
of the Change in Control. In the event Landlord disapproves of the
Change in Control, such Change in Control either may not take place or may take
place, provided that, if the Change of Control takes place, Landlord, at is
election, may either declare a Default of this Master Lease or demand that
Tenant close up to an additional five hundred (500) locations in addition to the
closures required below. If Landlord exercises its right to demand
additional closures, Tenant will provide Landlord, for Landlord’s approval, a
list of locations Tenant will close along with the proposed schedule for
closings. All locations approved by Landlord to be closed must be
closed within six (6) months following Landlord’s exercise of the above
described right, unless any time within that six (6) months falls between
October 1st of a
year and December 31st of that
same year. In that case, the six (6) month period described in this
paragraph will be extended by three (3) months.
(1) Despite the previous paragraph, Landlord’s approval of a Change
in Control is not required if the Change in Control results in the control of
Tenant by an investment company with at least [***] in invested capital
that is not invested in a competitor of either Tenant or Landlord; a company or
companies with consolidated group annual revenues exceeding [***] and with sales
and profits that increased in three (3) out of the five
(5) years prior to the Change in Control; a group of unaffiliated
individuals whose collective net worth exceeds five (5) times their acquisition
cost; or any combination of the above.
(2) For purposes of this Section 7, “Change in Control” means the direct or
indirect acquisition, other than as a result of the financial restructuring and
chapter 11 proceedings commenced by Tenant on August 31, 2006,
of the power to vote 50.1% or more of Tenant’s voting securities.
c.
Tenant shall provide Landlord quarterly financial statements that are prepared
by Tenant, reviewed on a quarterly basis by an independent certified public
accountant, and audited on an annual basis by such independent certified public
accountant. A solvency certificate in which an officer of Tenant
certifies to Landlord that Tenant is solvent and is generally paying its debts
as the debt becomes due must accompany each financial statement.
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8.
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Miscellaneous.
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a. Lease
Term.
(1) Despite anything to the contrary elsewhere in this Master Lease, this Master
Lease will not be effective unless the form and substance of the order from
the presiding bankruptcy court approving this Master Lease is acceptable
to Landlord, in its sole and absolute discretion, and such order becomes final
and nonappealable.
(2) Subject to the preceding paragraph, this Master Lease is
effective February 1, 2007 and continues for three (3) years unless terminated
earlier as the result of a Default (as defined in this Master Lease) or as
otherwise
permitted under this Master Lease.
(3) This Master Lease automatically extends for an additional two (2) years for
each applicable Leased Premises from which Landlord receives from Tenant Base
Rent for the period from July 1, 2008 through June 30, 2009
at a rate equal to or greater than [***] per square foot, provided that no
Default (as defined in this Master Lease) has occurred or is
continuing.
(4) For each Leased Premises from which Landlord receives from Tenant Base
Rent for the period of July 1, 2008 through June 30, 2009 at a rate less than
[***] per square foot, Landlord and Tenant may mutually agree to
extend this Master Lease for two (2) years by written agreement executed no
later than August 1, 2009, provided that no Default (as defined in this Master
Lease) has occurred and is continuing.
(5) If this Master Lease is not extended for any reason as to any Leased
Premises, Tenant will close the applicable Leased Premises and deliver such
locations to Landlord in a broom clean condition and consistent with
all other obligations of Tenant under this Master Lease on January 31, 2010 or
such earlier date as may be agreed to by Landlord and Tenant.
b.
Rent. Provided
Tenant is not in Default (as defined in this Master Lease) on its Rent
obligations, Base Rent, which will accrue daily for the term of this Master
Lease and any renewal thereof, is:
(1) From June 1, 2006 through January 31, 2008, [***] of the monthly Gross
Sales (as defined below). Tenant shall pay Landlord the Base Rent due
by the tenth (10th)
calendar day of the third month following the month
in which such Gross Sales occurred. For example, the monthly Base
Rent due for the period ending June 30, 2006 is due on September 10,
2006.
(2) From February 1, 2008 through January 31, 2009, [***] of the monthly
Gross Sales (as defined below). Tenant shall pay Landlord Base Rent
due by the tenth (10th)
calendar day of the second month following the
month in which such Gross Sales occurred. For example, the monthly
Base Rent due for the period ending February 29, 2008 is due on April 10,
2008.
(3) From February 1, 2009 through the end of the Lease Term, including any
renewal, [***] of the monthly Gross Sales (as defined below). Tenant
shall pay
Landlord the Base Rent due by the tenth (10th)
calendar day of the month
following the month in which such Gross Sales occurred. For example,
the monthly
Base Rent due for the period ending February 28, 2009 is due on March 10,
2009.
(4) In the event that Tenant fails to pay any amount due under this Master
Lease within five (5) days of the date such amount is due, Rent for the full
term of
this Master Lease will automatically reset to [***] of the monthly
Gross Sales, with any retroactive arrearages due and payable
immediately.
c.
Rebranding.
(1) Tenant and Landlord agree that Tenant’s right to use the “Wal-Mart”
name, which is Landlord’s trade name, constitutes a non-exclusive trademark
license
and, therefore, is a personal right to the Tenant, which may not be
assigned under applicable law including, without limitation, state and federal
trademark law,
without the prior, written consent of Landlord.
(2) Tenant shall remove the “Wal-Mart” name from all Leased Premises and
studios including, without limitation, any signage and promotional materials and
activity and cease using the “Wal-Mart” name no later than January
31, 2008, except as permitted elsewhere in this Master Lease.
(3) If Tenant Defaults under this Master Lease, Tenant will complete
rebranding as required by the preceding paragraph within three (3) months of the
date
of Default, at which time Tenant will no longer have any right to use
the “Wal-Mart” name.
d.
Rebranding
Escrow. [***]. Tenant shall deposit the Rebranding
Escrow within three (3) business days of the date on which the order from the
presiding bankruptcy court approving this Master Lease becomes final and
nonappealable. Tenant may only draw on the Rebranding Escrow to cover
the costs of the rebranding required in paragraph 8c, above. For
clarification, the Rebranding Escrow applies to a total of [***] installments of
Rent, which have payments with due dates from August 10, 2006 through April 10,
2007.
(1) Tenant shall deposit the Rebranding Escrow due for subsequent months no
later than the tenth (10th)
calendar day of each such month.
(2) Any balance of the Rebranding Escrow remaining in the escrow account
after January 31, 2008 must be paid to Landlord as additional Rent within
________
business days (Monday through Friday). If Tenant
fails to pay
Landlord the above-described balance of the Rebranding Escrow, Landlord may
withdraw
and retain as additional rent all amounts then remaining or thereafter deposited
into the escrow account. Landlord’s withdrawal
of such funds does not
in any way excuse Tenant’s obligation to complete the Rebranding as required in
paragraph 8c, above.
(3) Tenant shall provide Landlord with a monthly accounting of deposits
into and disbursements from the escrow account in a form acceptable to Landlord,
in its
sole and absolute discretion.
e.
Store
Closings. For purposes of this Section, “Fiscal Year” means
February 1st of a
given year through January 31st of the
following year.
(1) Tenant, no later than July 31, 2007, shall close the five hundred (500)
Leased Premises designated in Exhibit ______, which is attached to and
incorporated
into
this Master Lease.
(2) Starting with the Fiscal Year ending January 31, 2008 and continuing
through the Lease Term of this Master Lease, including any extension, until the
first
Fiscal Year in which Tenant achieves positive comparable sales in
the Leased Premises, Tenant shall close an additional five hundred (500) Leased
Premises every Fiscal Year in which either Landlord’s total US comparable stores
sales are flat or positive and Tenant’s comparable
stores sales for the
same Fiscal Year are negative, or Landlord’s total US comparable stores sales
are negative and Tenant’s comparable stores sales for that same Fiscal Year
are not positive and are more than fifty
(50) basis points of Landlord’s comparable stores sales. After the
first year that Tenant achieves positive comparable
sales, Tenant is no longer obligated to close Leased Premises as described in
the preceding
sentence.
(3) Tenant shall submit its total sales and, if applicable, will submit to
Landlord for approval a list of Leased Premises to be closed, along with a
schedule of
closings, by February 10th of the
subsequent Fiscal Year or no later
than five (5) days after Landlord publishes its US sales for that Fiscal
Year. All such
Leased Premises closings must be completed no later than July 31st of the
subsequent Fiscal Year. Approval of Leased Premises Tenant
proposes to
close in accordance with this Section 8e will be in Landlord’s sole and absolute
discretion.
(4) All Leased Premises closed in accordance with this Section 8e must be
closed in accordance with Section 17.3 of the Master Lease Agreement, except
that Tenant shall leave each Leased Premises closed in accordance
with this Section 8e in broom clean condition.
f.
Additional Events of
Default. In addition to the Events of Default designated elsewhere in
this Master Lease, an Event of Default occurs if:
(1) Tenant commences or involuntarily becomes the subject of any case filed
under chapter 7 or chapter 11 of title 11 of the United States Code (the
“Bankruptcy
Code”), or any similar insolvency proceeding. If
Tenant so
Defaults on this Master Lease, Tenant will vacate the Leased Premises as soon
after the above
described filing as possible but no later than the expiration of the statutory
period under section 365 of the Bankruptcy Code for
assumption of leases unless
this Master Lease has been assumed by that date pursuant to an order entered
upon proper motion with appropriate notice and opportunity for
parties-in-interest
including, without limitation,
Landlord, to respond to or object to such motion. In light of the
Intent (as described below), the statutory period set forth in
section 365(d)(4)(A) of the Bankruptcy Code for assumption of leases will
not extend
for any reason including, without limitation, pending the outcome of
any related litigation or appeal, unless Landlord consents in
writing.
(2) Tenant defaults on any agreement with a lender with respect to any debt
facility and: (i) as a result of such default, the debt facility is accelerated;
(ii)
Tenant fails to
cure such default; or (iii) the lender, within ninety (90) days
after the occurrence of the default, refuses to permanently waive the
default.
Tenant shall notify
Landlord of any notice of default from any lender with respect to any debt
facility promptly after receiving such notice.
g.
Additional
Remedies. In addition to Landlord’s rights and remedies
available to it elsewhere in this Master Lease, at law, or in equity, if Tenant
Defaults on this Master Lease and in light of the Intent of the parties as
described below, Tenant waives the automatic stay or any similar provision, if
applicable, and authorizes Landlord to exercise any and all remedies available
to Landlord without need for notice or any further proceedings including,
without limitation, court proceedings, upon the earlier to occur of either the
termination of this Master Lease or the expiration of the statutory period
described in paragraph 8f(1), above.
h.
Control. To
the extent Article X of the Master Lease Agreement conflicts with this paragraph
8h, this paragraph 8h governs. Tenant shall obtain Landlord’s consent
prior to Tenant’s causing or permitting, within any twelve (12) month period,
the Transfer of more than either an aggregate of twenty five per cent (25%) of
Tenant’s voting shares or twenty five per cent (25%) of the value of Tenant’s
unencumbered assets as of the date of the Transfer. If
Landlord does not consent, Landlord, in its sole discretion, may declare a
Default of this Master Lease.
(1) If Landlord consents to the proposed Transfer of Tenant’s voting
shares, as described in the preceding sentence, or of Tenant’s unencumbered
assets, as described
in the preceding sentence, Landlord will notify Tenant of
its consent within five (5) business days after Landlord receives Tenant’s
written notice of the proposed Transfer.
Landlord may not unreasonably withhold its consent.
(2) Despite the foregoing, Landlord's consent will not be required under
this Master Lease prior to the trading of Tenant's shares on the public
securities markets, except
that Landlord's consent will be required prior to additional
purchases by any person or group who is or becomes the beneficial owner of 25%
or more of Tenant's voting shares.
(3) Additionally, Landlord’s consent is not required under
this Master Lease for any Transfer of Tenant’s unencumbered assets that is for
fair value and that does not diminish
Tenant’s ability to operate its business in the
Leased Premises in accordance with this Master Lease.
(4) For the avoidance of doubt, Tenant does not have the right to Transfer
(as defined in this Master Lease) or assign its rights under all or any portion
of this Master Lease to
a third party in any manner or under any circumstances. As
noted in the Intent (described below), the nature of the relationship between
the parties is unique and the
nature of the Leased Premises is unique. Tenant and Landlord agree
that this Master Lease qualifies
as, and is treated as, a “personal services contract,” as such term
is used in Section 365 of the Bankruptcy Code.
i.
Letter of
Credit. Tenant shall provide Landlord with an irrevocable
standby letter of credit in the amount of [***] drawable by Landlord upon any
failure by or inability of Tenant to timely meet its obligations under this
Master Lease or to Tenant’s customers including, without limitation, obligations
resulting from the filing of a subsequent bankruptcy proceeding by or against
Tenant or the shutdown, not previously authorized by Landlord, by Tenant of
operations at any Leased Premises. Tenant shall maintain this letter
of credit on an evergreen basis during the term of this Master Lease, including
any extension of this Master Lease. Landlord shall use the proceeds
from this letter of credit as it determines in its sole and absolute discretion
including, without limitation, to refund customer deposits; to cover other
transitional costs including, without limitation, reletting the Leased Premises;
and to acquit any other pending obligations of Tenant.
j.
Audit. For
purposes of this Master Lease, “Gross Sales” means the aggregate selling price
of all merchandise sold or delivered at or from any part of the Leased Premises
and the charges for all services sold or performed at or from any part of the
Leased Premises or at any other location if the merchandise is taken from the
Leased Premises or the order for services taken at the Leased Premises including
sales and charges for cash or credit and credit sales regardless of
collections. “Gross Sales” excludes refunds made by Tenant to its
customers for merchandise originally included in Gross Sales but returned to
Tenant; exchanges of merchandise between stores of Tenant where such exchanges
are made solely for the convenient operation of Tenant’s business; and the
amount of any city, country, or state sales tax on sales paid to a taxing
authority by Tenant, but not by any vendor of Tenant. A sale is made
in the Leased Premises if the merchandise or services are ordered from the
Leased Premises in person, via telephone facsimile, internet, or other
electronic means, or filled at the Leased Premises, or delivered from the Leased
Premises.
(1) Landlord has the right to inspect and audit all books and records
and other papers and files of Tenant relating to Gross Sales. Any
such inspection or audit will be conducted during Tenant’s regular business
hours,
and if Landlord so requests, Tenant will produce the appropriate books and
records and other papers and files relating to Gross Sales.
(2) If any audit conducted in accordance with this paragraph 8j discovers
evidence of under-reporting of Gross Sales by an amount equal to or greater than
[***] or more in any given month, or by [***] or more in any
given two months, Tenant will be in Default of this Master Lease.
k.
Intent. Landlord
and Tenant agree that they have a unique relationship and that the terms of this
Master Lease have been negotiated and drafted based on the advice and with the
assistance of experienced legal counsel with the express intention of reflecting
that relationship (the “Intent”). Each provision of this Master Lease
has been drafted and incorporated herein in light of and in furtherance of the
Intent and in light of each of the following acknowledgements by
Tenant:
(1) The unique nature of Landlord’s operations and reputation as one of the
largest operators of discount retail stores dedicated to customer satisfaction
and prompt, quality customer service featuring a broad
assortment of quality merchandise at low, competitive prices;
(2) The unique circumstances of maintaining Tenant’s operations within
Landlord’s Stores and the concomitant obligations of Tenant to observe each and
every term of this Master Lease in order to further Landlord’s
operations and reputation and not to, in any way, impair the shopping experience
of Landlord’s customers;
(3) The risk to Landlord’s operations and reputation of Tenant’s financial
problems and uncertainties created during Tenant’s Chapter 11 proceedings
(pending on the date of this Master Lease);
(4) The
propriety and importance of protecting Landlord’s unique Store space,
operations, and reputation in the vent of a subsequent Chapter 11 or other
insolvency event of Tenant;
(5) That Landlord is a “shopping center” and that this Master Lease is a
“shopping center lease,” as those terms are defined and used in section 365 of
chapter 11 of the Bankruptcy Code;
(6) That Tenant is not an affiliate or agent of, or in any way controlled
by or under the control of Landlord; and
(7) The reliance of Landlord on Tenant’s representations that Tenant
will abide by the terms of this Master Lease including, without limitation, the
limited Permitted Use of the Leased Premises, as described in paragraph
1a, above, and the prohibition on assignment and transfer.
l.
Not Severable.
Whether or not certain of the terms of this Master Lease are specific to or can
be applied to individual Leased Premises, the entire Master Lease including,
without limitation, the Lease Term and Rent, was negotiated and agreed upon
based on the integrated nature of the entire agreement and the Intent of the
parties is to create an integrated agreement. The parties acknowledge
and aver that this Master Lease and any of the entitlements hereunder would make
no economic sense on a partial or several basis. Accordingly, in view
of the foregoing and of the Intent, Tenant agrees that this Master Lease and the
Leased Premises hereunder cannot be severed or partially assumed in any manner
without the express written consent of Landlord. Tenant waives any
and all rights, if any, to seek to sever or partially assume any portion of this
Master Lease pursuant to section 365 of the Bankruptcy Code or
otherwise.
m. Despite
anything to the contrary is Section 19.13 of the Master Lease Agreement, Tenant
shall pay all reasonable attorney’s fees and expenses incurred by Landlord by
reason of any Default by Tenant and the enforcement of any remedies in
connection with or related to such Default. Additionally, Tenant
agrees that in the event of a subsequent chapter 11, chapter 7, or similar
proceeding, any attorney’s fees or expenses incurred following the filing of the
petition for relief, to the extent allowed under applicable state law, are
recoverable by Landlord as a pecuniary loss. Therefore, any such
attorney’s fees or expenses must be paid by Tenant as a prerequisite to the
assumption of this Master Lease pursuant to section 365 of the Bankruptcy Code
or otherwise.
n.
The Master License Agreement entered into by Tenant and Landlord on April 4,
2002 (“License Agreement”) is null and void and is superseded by this Master
Lease. All locations licensed under that License Agreement are hereby
Leased Premises under this Master Lease and subject to the terms and conditions
of this Master Lease. Landlord and Tenant may execute either a single
Attachment A listing all locations licensed under the License Agreement bringing
those locations under this Master Lease or execute individual Attachment As for
each location.
o.
This Appendix-1 is attached to and incorporated into the Master Lease as part of
the entire agreement between Landlord and Tenant, as set forth in Section 19.3
of the Master Lease Agreement. All capitalized terms used in this
Appendix-1 have the meanings set forth in this Master Lease, unless otherwise
specifically stated in this Appendix-1. In the
event of conflict between the Master Lease Agreement and any other document on
the subject matters set forth in this Appendix-1, the terms of this Appendix-1
govern and control.
[signature
page to follow]
***Confidential
treatment requested.
CHI99 5003400-1.020242.0010
CONFIDENTIAL
TREATMENT REQUESTED FOR PORTIONS OF THIS DOCUMENT. PORTIONS FOR WHICH
CONFIDENTIAL TREATMENT IS REQUESTED ARE DENOTED WITH BRACKETS.
Tenant:
__________
Signed:
Witness: Landlord: Wal-Mart
Stores, Inc.
_________________________ ___________________________________
Date
Wal-Mart Stores, Inc.
_________________________
Witness: Landlord: Wal-Mart
Stores East, LP
_________________________ ___________________________________
Date
Wal-Mart Stores East, LP
_________________________
Witness: Landlord: Wal-Mart
Stores Texas, LP
_________________________ ___________________________________
Date
Wal-Mart Stores Texas, LP
_________________________
Witness: Landlord: Wal-Mart
Louisiana, LLC
_________________________ ___________________________________
Date
Wal-Mart Louisiana, LLC
_________________________
Signed:
Witness: Tenant: Portrait
Corporation of America, Inc.
_________________________ ___________________________________
Signature Date
_________________________ _________________________
Printed Name
_________________________
Title
CHI99 5003400-1.020242.0010
CONFIDENTIAL
TREATMENT REQUESTED FOR PORTIONS OF THIS DOCUMENT. PORTIONS FOR WHICH
CONFIDENTIAL TREATMENT IS REQUESTED ARE DENOTED WITH BRACKETS.
Tenant:
__________
Appendix-2
- Insurance
Tenant shall procure and maintain, in
accordance with the Master Lease, the “primary” insurance policies described
below in accordance with the below conditions.
1. Worker’s
Compensation insurance with statutory limits, or if no statutory limits exist,
with minimum limits of [***] per occurrence, and Employer’s Liability coverage
with minimum limits of [***], for each employee for bodily injury by accident
and for each employee for bodily injury by disease. Tenant shall
cause Insurer to issue an endorsement providing stopgap insurance in
monopolistic states in which a Leased Premises under this Master Lease may be
located.
2. Commercial
General Liability insurance with a [***] minimum limit per occurrence for each
Leased Premises leased under the Master Lease or with fresh aggregate limits for
each Leased Premises leased under the Master Lease.
a. The
Commercial General Liability policy required under this Paragraph 2 should
contain neither exclusion for contractual liability assumed by Tenant in a lease
nor any Absolute Pollution exclusion, unless these coverages are provided by a
separate policy with minimum limits equal to the Commercial General Liability
policy limits required by this Paragraph 2.
b. Any
policy obtained to satisfy the obligations of this Paragraph 2 must list as
Additional Insureds the parties described below in Paragraph 4.
c. Tenant
shall submit to Landlord no later than thirty (30) days after the actual Rent
Commencement Date, Certificates of Insurance and endorsements evidencing
Tenant’s compliance with this Paragraph 2.
3. Tenant
may satisfy the minimum limits required in Paragraphs 1 and 2, above, by
procuring and maintaining, in accordance with Article XIV of the Master Lease,
Umbrella/Excess Liability insurance on an umbrella basis, in excess over, and no
less broad than the primary liability coverage; with the same inception and
expiration dates as the primary liability coverage it is in excess of; with
minimum limits necessary to satisfy the required primary minimum limits; and
which “drop down” for any exhausted aggregate limits of the primary liability
coverage. Tenant shall cause Insurer to issue an endorsement to any
policy Tenant procures in satisfaction of its obligations in this paragraph
providing fresh per occurrence limits or fresh aggregate limits for each Leased
Premises leased under this Master Lease and listing as Additional Insured the
parties described below in Paragraph 4.
4. Additional
Insureds are Wal-Mart Stores, Inc., its Subsidiaries and its Affiliates, and the
directors, officers, shareholders, employees, agents, and representatives, and
the respective successors and assigns of each, and any party Landlord has a
contractual obligation to indemnify for Claims in connection with the Store or
the Leased Premises.
5. This
Appendix-2 attaches to and incorporates into the Master Lease Agreement as part
of the entire agreement between Landlord and Tenant, as set forth in Section
19.3 of the Master Lease Agreement. All capitalized terms used in
this Appendix-2 have the meanings set forth in this Master Lease, unless
otherwise specifically stated in this Appendix-2. In the event of
conflict between the Master Lease Agreement and any other document on the
subject matters set forth in this Appendix-2, the terms of this Appendix-2
control.
[signature
page to follow]
CHI99 5003400-1.020242.0010
CONFIDENTIAL
TREATMENT REQUESTED FOR PORTIONS OF THIS DOCUMENT. PORTIONS FOR WHICH
CONFIDENTIAL TREATMENT IS REQUESTED ARE DENOTED WITH BRACKETS.
Tenant:
__________
Signed:
Witness: Landlord: Wal-Mart
Stores, Inc.
_________________________ ___________________________________
Date
Wal-Mart Stores, Inc.
_________________________
Witness: Landlord: Wal-Mart
Stores East, LP
_________________________ ___________________________________
Date
Wal-Mart Stores East, LP
_________________________
Witness: Landlord: Wal-Mart
Stores Texas, LP
_________________________ ___________________________________
Date
Wal-Mart Stores Texas, LP
_________________________
Witness: Landlord: Wal-Mart
Louisiana, LLC
_________________________ ___________________________________
Date
Wal-Mart Louisiana, LLC
_________________________
Signed:
Witness: Tenant: Portrait
Corporation of America, Inc.
_________________________ ___________________________________
Signature Date
_________________________ _________________________
Printed Name
_________________________
Title
CHI99 5003400-1.020242.0010