LAND AND BUILDING LEASE AGREEMENT LANDLORD: YA Landholdings, LLC a Delaware limited liability company TENANT: Appalachian Oil Company, Inc., a Tennessee corporation
APPCO
41
LANDLORD:
YA
Landholdings, LLC
a
Delaware limited liability company
TENANT:
Appalachian
Oil Company, Inc.,
a
Tennessee corporation
TABLE
OF CONTENTS
|
DEFINITIONS
|
1
|
||
|
1.1
|
Lease
Year
|
1
|
|
|
1.2
|
Hazardous
Material
|
1
|
|
|
1.3
|
Wastes
|
2
|
|
|
1.4
|
Environmental
Laws
|
2
|
|
|
1.5
|
Storage
Tank System
|
2
|
|
|
1.6
|
Release
|
2
|
|
|
2.
|
CONDITION
OF THE PREMISES
|
2
|
|
|
3.
|
TERM
|
3
|
|
|
3.1
|
Primary
Term
|
3
|
|
|
3.2
|
First
Option to Extend
|
3
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|
|
3.3
|
Second
Option to Extend
|
3
|
|
|
3.4
|
Third
Option to Extend
|
3
|
|
|
3.5
|
Fourth
Option to Extend
|
4
|
|
|
3.6
|
Surrender
of Premises; Holding Over
|
4
|
|
|
4.
|
BASE
MONTHLY RENT
|
4
|
|
|
4.1
|
Triple
Net Lease
|
4
|
|
|
4.2
|
BaseMonthlyRent
|
5
|
|
|
4.3
|
Adjustment
Date
|
5
|
|
|
5.
|
USE
OF THE PREMISES; COMPLIANCE
|
5
|
|
|
5.1
|
Use
of the Premises
|
5
|
|
|
5.2
|
Compliance
|
6
|
|
|
6.
|
PROPERTY
TAXES, OTHER CHARGES, ASSESSMENTS AND UTILITIES
|
6
|
|
|
6.1
|
Tenant’s
Required Payments
|
6
|
|
|
6.2
|
Payments
Not Required by Tenant
|
7
|
|
|
6.3
|
Assessments
|
8
|
|
|
6.4
|
Utility
Payments
|
8
|
|
|
6.5
|
Tenant’s
Right to Contest Utility Charges, Contest Taxes and Seek Reduction
of
Assessed Valuation of the Premises
|
8
|
|
|
6.6
|
Landlord
Not Required to Join in Proceedings or Contest Brought by
Tenant
|
8
|
|
|
6.7
|
Partial
Lease Years and Adjustment of Taxes
|
9
|
|
|
7.
|
FURNITURE,
FIXTURES AND EQUIPMENT
|
9
|
|
|
7.1
|
Furniture,
Fixtures, and Equipment
|
9
|
|
|
7.2
|
Landlord’s
Waiver
|
9
|
|
|
7.3
|
Removal
of Tenant’s Personal Property at Expiration of Lease
|
9
|
|
|
7.4
|
Right
to Affix Signs
|
10
|
|
|
8.
|
MAINTENANCE
AND REPAIRS OF THE PREMISES
|
10
|
|
|
8.1
|
Obligation
to Maintain the Premises
|
10
|
|
|
8.2
|
Obligation
to Keep the Premises Clear
|
10
|
|
|
9.
|
ALTERATIONS
AND IMPROVEMENTS
|
11
|
|
ii
|
9.1
|
Right
to Make Alterations
|
11
|
|
|
9.2
|
Tenant
Shall Not Render Premises Liable For Any ▇▇▇▇
|
▇▇
|
|
|
▇▇.
|
INDEMNITY
AND INSURANCE
|
12
|
|
|
10.1
|
Indemnification
|
12
|
|
|
10.2
|
Insurance
Company Requirement
|
12
|
|
|
10.3
|
Insurance
Certificate Requirements
|
12
|
|
|
10.4
|
Minimum
Acceptable Insurance Coverage Requirements
|
13
|
|
|
10.5
|
Additional
Insureds
|
15
|
|
|
10.6
|
Mortgage
Endorsement
|
15
|
|
|
10.7
|
Renewals,
Lapses or Deficiencies
|
15
|
|
|
10.8
|
Waiver
of Subrogation
|
16
|
|
|
11.
|
PARTIAL
AND TOTAL DESTRUCTION OF THE PREMISES
|
16
|
|
|
11.1
|
Damage
or Destruction of Premises
|
16
|
|
|
11.2
|
Damage
or Destruction During the Last Twenty-four (24) Months of the
Term
|
16
|
|
|
12.
|
CONDEMNATION
|
17
|
|
|
12.1
|
Condemnation
Damages
|
17
|
|
|
12.2
|
Termination
of Lease Due to Condemnation
|
17
|
|
|
13.
|
ASSIGNMENT
AND SUBLETTING
|
18
|
|
|
13.1
|
Tenant’s
Right of Assignment and Subletting
|
18
|
|
|
13.2
|
Assignment
Without Landlord’s Consent
|
18
|
|
|
13.3
|
Assignment
with Landlord’s Consent
|
19
|
|
|
13.4
|
Subletting
Without Landlord’s Consent
|
19
|
|
|
13.5
|
Landlord’s
Option to Preserve Subtenancies
|
19
|
|
|
13.6
|
Rent
from Subletting
|
19
|
|
|
13.7
|
Continuing
Obligation of Tenant
|
20
|
|
|
13.8
|
Landlord’s
Right of Assignment
|
20
|
|
|
14.
|
DEFAULT
AND TERMINATION
|
20
|
|
|
14.1
|
Event
of Default
|
20
|
|
|
14.2
|
Landlord’s
Remedies
|
21
|
|
|
14.3
|
Right
of Landlord to Re-Enter
|
24
|
|
|
14.4
|
Surrender
of Premises
|
24
|
|
|
14.5
|
Interest
Charges
|
24
|
|
|
14.6
|
Default
by Landlord
|
25
|
|
|
15.
|
RIGHT
OF INSPECTION
|
25
|
|
|
16.
|
WAIVER
OF BREACH
|
25
|
|
|
17.
|
NOTICES
|
25
|
|
|
17.1
|
Notice
Requirements
|
25
|
|
|
17.2
|
Payments
Under Lease
|
26
|
|
|
18.
|
RELATIONSHIP
OF THE PARTIES
|
27
|
|
|
19.
|
SUBORDINATION,
ATTORNMENT AND ESTOPPEL
|
27
|
|
|
19.1
|
Subordination
and Non-Disturbance
|
27
|
|
|
19.2
|
Attornment
|
27
|
|
|
19.3
|
Tenant
Estoppel Certificate
|
27
|
|
|
19.4
|
Landlord
Estoppel Certificate
|
27
|
|
|
19.5
|
Leasehold
Mortgage
|
28
|
|
iii
|
20.
|
ATTORNEYS’
FEES
|
30
|
|
|
20.1
|
Recovery
of Attorneys’ Fees and Costs of Suit
|
30
|
|
|
20.2
|
Party
to Litigation
|
30
|
|
|
21.
|
AUTHORITY
TO MAKE LEASE; COVENANT OF QUIET ENJOYMENT
|
30
|
|
|
21.1
|
Full
Power and Authority to Enter Lease
|
30
|
|
|
21.2
|
Quiet
Enjoyment
|
30
|
|
|
22.
|
HAZARDOUS
MATERIAL
|
30
|
|
|
22.1
|
Compliance
Generally
|
30
|
|
|
22.2
|
Tenant’s
Responsibility for Hazardous Materials
|
31
|
|
|
22.3
|
Tenant’s
Environmental Indemnification
|
31
|
|
|
22.4
|
Tenant’s
Notification Obligations
|
32
|
|
|
22.5
|
Survival
|
32
|
|
|
23.
|
GENERAL
PROVISIONS
|
32
|
|
|
23.1
|
Recitals
|
32
|
|
|
23.2
|
Gender;
Number
|
32
|
|
|
23.3
|
Captions
|
32
|
|
|
23.4
|
Exhibits
|
33
|
|
|
23.5
|
Entire
Agreement
|
33
|
|
|
23.6
|
Drafting
|
33
|
|
|
23.7
|
Modification
|
33
|
|
|
23.8
|
Joint
and Several Liability
|
33
|
|
|
23.9
|
Enforceability
|
33
|
|
|
23.10
|
Severability
|
33
|
|
|
23.11
|
Successors
and Assigns
|
34
|
|
|
23.12
|
Independent
Covenants
|
34
|
|
|
23.13
|
Limitation
on Landlord’s Liability
|
34
|
|
|
23.14
|
Waiver
of Trial by Jury
|
34
|
|
|
23.15
|
Characterization
of Lease
|
34
|
|
|
23.16
|
Counterparts
|
35
|
|
|
23.17
|
Force
Majeure
|
35
|
|
|
23.18
|
Confidentiality
|
35
|
|
EXHIBIT
“A” -LEASED PREMISES
Exhibit
“B” —
Memorandum
of Lease
Exhibit
“C” —
Certificate
of Liability Insurance and Evidence of Property Insurance
Exhibit
“D” —
Form
of
Subordination, Non-Disturbance and Attornment Agreement
Exhibit
“E” - Not Applicable
iv
This
Land
and Building Lease Agreement (this “Lease”),
dated
for
reference purposes
only as of ,
is
made
by and between YA
Landholdings, LLC, a Delaware limited liability company (“Landlord”),
and
Appalachian
Oil Company, Inc.,
a
Tennessee corporation (“Tenant”),
with
reference to the recitals set forth below.
RECITALS
A.
Landlord is the owner of a certain real property identified as the “Leased
Premises,”
attached hereto and incorporated herein as Exhibit
“A”,
together
with all improvements located thereon, but
not
Tenant’s Personal Property (as defined in Section 7.1), and which real property
shall include all of Landlord’s right, title and interest in and to all
roadways, sidewalks, walkways, parkways, driveways, common areas, landscaped
areas and similar areas and facilities and appurtenances thereunto belonging
(all of the foregoing real properties, improvements and appurtenances being
hereinafter collectively referred to as the “Premises”).
B.
Landlord desires to lease the Premises to Tenant, and Tenant desires to lease
the Premises from Landlord, pursuant to the provisions of this
Lease.
1.
DEFINITIONS
The
following terms, when used in this Lease, shall have the meaning set forth
in
this Section.
| 1.1 |
Lease
Year
|
The term
“Lease
Year” shall
mean the first twelve (12) full calendar months after the Commencement Date
(as
defined in Section 3.1) and each subsequent twelve (12) month period thereafter
during the term and any extensions. If the Commencement Date is other than
the
first day of the month, then the first Lease Year also will include the partial
month in which the Commencement Date occurs.
| 1.2 |
Hazardous
Material
|
The
term“Hazardous
Material” means
any
and all hazardous, toxic or radioactive substances or materials, including
but
not limited to asbestos or asbestos-containing materials, petroleum and
petroleum products (including without limitation, gasoline and diesel),
pollutants, pollution, contaminants or contamination as those terms are defined,
designated or otherwise regulated under any applicable Environmental Law and
includes Wastes (as such terms are herein defined).
1
| 1.3 |
Wastes
|
The
term“Wastes”
means
any
and all chemical, petroleum, or biological wastes, emissions or discharges,
whether hazardous or non-hazardous, liquid, solid or gaseous, and whether
from any production, operation, maintenance, manufacturing, processing, storage,
use or other activity, where such wastes, contaminants, emissions or discharges
are regulated under Environmental Laws.
| 1.4 |
Environmental
Laws
|
The
term
“Environmental
Laws” means
all
federal, state and local statutes, regulations, ordinances, rules, policies,
directives, orders, demands or requirements of any government agency, in each
case solely to the extent having the force of law, and all common law, to the
extent regulating, relating to, affecting or imposing liability or other
obligations concerning Hazardous Materials or protecting public health or safety
or the environment, including with respect to the occupational health or
environmental conditions on or about the Premises, as now exist or may at any
later time be adopted or amended, including laws and regulations to the extent
relating to Storage Tank Systems, gasoline service stations, Hazardous
Materials, Release reporting requirements, noise abatement requirements and
provisions thereof protecting natural resources, species and
habitat.
| 1.5 |
Storage
Tank System
|
The
term“Storage
Tank System” means
a
complex of one or more underground or above ground storage tanks and their
associated underground, above-ground, and/or connected piping and related fuel
dispensing, pumping, mechanical, control and monitoring or detection devices,
facilities or equipment.
| 1.6 |
Release
|
The
term“Release”
means
any
spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, dumping, or disposing into the environment of any Hazardous
Material.
2.
CONDITION OF THE PREMISES
Landlord
leases to Tenant and Tenant leases from Landlord the Premises in an “AS
IS, WHERE IS, WITH ALL FAULTS” condition with
no
representations or warranties whatsoever and on the terms and conditions set
forth in this Lease. Tenant acknowledges that it has occupied the Premises
for a
substantial period of time prior to the Commencement Date and that Tenant is
familiar with the condition of the Premises, and Tenant further acknowledges
and
agrees that other than as set forth in this Lease: (i) no representations have
been or are made, or responsibility assumed by Landlord with respect to the
Premises or its operations, or the condition or repair of the Premises, or
as to
any fact, circumstance, thing or condition which may affect or relate to the
Premises, except as specifically set forth in this Lease; (ii) the Premises
are
leased in an “AS
IS, WHERE IS, WITH ALL FAULTS” condition
as of the Commencement Date; and (iii) Landlord shall have no obligation to
alter, restore, improve, repair or develop the Premises, and further shall
have
no obligation to remove therefrom any parties or items of personal property,
or
other trade fixtures or equipment which may be upon the
Premises.
2
3.
TERM
| 3.1 |
Primary
Term
|
The
effective date (the “Commencement
Date”) of
this
Lease shall be the date upon which escrow is deemed closed pursuant to that
certain Purchase Agreement of even date herewith by and between Tenant, as
“Seller,” and Landlord, as “Buyer” (“Purchase
Agreement”). The
expiration date (the“Expiration
Date”) of
the primary
term
(the “Primary Term”) of
this
Lease shall be the last day of the month which is twenty (20) Lease Years
following the Commencement Date, unless terminated earlier as provided herein
or
extended as set forth in Sections 3.2, 3.3, 3.4, and 3.5. References to the
term
of the Lease shall include extensions, if any; and references in this Lease
to
the Expiration Date shall refer to the expiration of any Extension Periods
which
may be exercised by Tenant pursuant to this Lease. Except as otherwise expressly
stated, the terms and conditions of this Lease shall remain in effect during
any
extension, renewal or holdover of the Primary Term. Concurrently with the
recording of the deed transferring ownership of the Premises to Landlord, a
Memorandum of Lease substantially in the form of Exhibit
“B”
attached hereto and incorporated herein, may be recorded by and at the expense
of Tenant with respect to the Premises.
| 3.2 |
First
Option to Extend
|
One
hundred eighty (180) days prior to the expiration of the Primary Term, provided
there are no uncured monetary Events of Default (as defined in Section 14)
existing under the Lease, Tenant may extend the term of this Lease for an
additional sixty (60) months by notifying Landlord of such intention in writing
(“First
Extension Period”). The maximum
term of the Lease with one extension is twenty five (25) Lease
Years.
| 3.3 |
Second
Option to Extend
|
One
hundred eighty (180) days prior to the expiration of the First Extension Period,
provided there are no uncured monetary Events of Default existing under the
Lease, Tenant may extend the term of this Lease for an additional sixty (60)
months by notifying Landlord of such intention in writing (“Second
Extension Period”). The
maximum term of the Lease with two extensions is thirty (30) Lease
Years.
| 3.4 |
Third
Option to Extend
|
One
hundred eighty (180) days prior to the expiration of the Second Extension
Period, provided there are no uncured monetary Events of Default existing under
the Lease, Tenant may extend the term of this Lease for an additional sixty
(60)
months by notifying Landlord of such intention in writing (“Third
Extension Period”). The
maximum term of the Lease with three extensions is thirty five (35) Lease
Years.
3
| 3.5 |
Fourth
Option to Extend
|
One
hundred eighty (180) days prior to the expiration of the Third Extension Period,
provided there are no uncured monetary Events of Default existing under the
Lease, Tenant may extend the term of this Lease for an additional sixty (60)
months by notifying Landlord of such intention in writing
(“Fourth Extension Period”). The
maximum term of the Lease with
four
extensions is forty (40) Lease Years.
| 3.6 |
Surrender
of Premises; Holding Over
|
On
the
last day or sooner termination of the term of this Lease, Tenant shall quit
and
surrender the Premises, together with all alterations, vacant and free of all
tenancies and any leasehold rights therein and in good condition and repair,
normal wear and tear and damage from casualty excepted, broom clean and free
of
violations of applicable laws caused or permitted by Tenant, its subtenants,
licensees, concessionaires, contractors, agents or employees and shall surrender
all keys for the Premises to Landlord at the place then fixed for the payment
of
rent and shall inform Landlord of all combinations of locks, safes, and vaults,
if any, in the Premises. If Tenant does not do so as set forth above, then
after
expiration of this Lease, it will be a month-to-month tenant upon the applicable
conditions of this Lease at 200% of the then applicable Base Monthly Rent.
If
the Premises are not surrendered as and when aforesaid, Tenant shall indemnify
Landlord from and against loss or liability resulting from the delay by Tenant
in so surrendering the Premises, including without limitation, any claims made
by any succeeding occupant or purchaser founded on such delay. Tenant’s
obligations under this Section shall survive the expiration or earlier
termination of this Lease.
4.
BASE MONTHLY RENT
| 4.1 |
Triple
Net Lease
|
This
is a
triple net lease. It is the intention of Landlord and Tenant that the Base
Monthly Rent (as defined below) and other sums and charges provided herein
shall
be absolutely net to Landlord. The Base Monthly Rent shall be payable in advance
in consecutive monthly installments on the first day of each month during the
Term. Except as otherwise specifically set forth in this Lease, Tenant shall
pay, as additional rent, all costs, charges, obligations, assessments, and
expenses of every kind and nature against or relating to the Premises or the
use, occupancy, area, possession, leasing, operation, management, maintenance,
or repair thereof, that may arise or become due during the term hereof, or
that
may pertain to this transaction, whether or not now customary or within the
contemplation of the parties hereto, and which, except for the execution and
delivery of this Lease, would have been payable by Landlord, but in no event
shall Tenant be obligated to pay any (i) of Landlord’s income, profits, gross
receipts, excise, estate or similar taxes, (ii) expenses of debt service
relating to any mortgage, deed of trust or other financing entered into by
Landlord or which shall encumber Landlord’s interest in the Premises, or (iii)
expenses, costs or charges caused by the gross negligence or willful misconduct
of Landlord, its agents or employees.
4
| 4.2 |
Base
Monthly Rent
|
Tenant
shall pay
to
Landlord as base monthly rent
(“Base Monthly Rent”) the sum
of
Five Thousand Four Hundred Sixteen and 67/Dollars ($5,416.67) per
month.
Effective
on each Adjustment Date (as hereinafter defined) Base Monthly Rent shall be
increased by TEN PERCENT (10%) of the Base Monthly Rent payable during the
immediately preceding period.
If
the
Commencement Date is a date other than the first day of the month, Base Monthly
Rent shall be payable by Tenant to Landlord in advance commencing upon the
Commencement Date pro-rated based on the ratio that the number of days from
the
Commencement Date through the last day in the month containing the Commencement
Date bears to the actual number of days in such month. Thereafter, Base Monthly
Rent shall be payable on the first day of each calendar month thereafter,
without prior notice, invoice, demand, deduction or offset whatsoever, except
as
otherwise provided in this Lease. Landlord shall have the right to accept all
rent and other payments, whether full or partial, and to negotiate checks and
payments thereof without any waiver of rights, irrespective of any conditions
to
the contrary sought to be imposed by Tenant. All rent shall be paid to Landlord
at the address to which notices to Landlord are given. The Base Monthly Rent
for
any partial month shall be prorated based upon the actual number of days in
the
period subject to proration.
| 4.3 |
Adjustment
Date
|
“Adjustment
Date” shall
mean,
as
the
case may require, the Fifth (5th),
Tenth
(10th)
and
Fifteenth (15th)
anniversaries of the Commencement Date (provided, however, if the Commencement
Date is other than the first day of the month, then “Adjustment Date” shall
mean, as the case may require, the first day of the first month occurring after
the Fifth (5th),
Tenth
(10th)
and
Fifteenth (15th)
anniversaries of the Commencement Date), and the first day of the First
Extension Period, Second Extension Period, Third Extension Period, Fourth
Extension Period.
5.
USE OF
THE PREMISES; COMPLIANCE
| 5.1 |
Use
of the Premises
|
Tenant
shall use the Premises for a convenience food store and retail motor fuel sales
(“Initial
Use”),
or
for such other uses as Tenant may
determine in Tenant’s reasonable business judgment and as Landlord shall approve
in Landlord’s reasonable judgment, provided that such uses: (i) are lawful; (ii)
are in compliance with applicable environmental, zoning and land use laws and
requirements; and (iii) do not violate matters of record or restrictions
affecting the Premises. Notwithstanding the foregoing, in no event may the
Premises be used as a factory, processing or rendering plant, massage parlor,
peep show store, head shop store, topless or strip club, adult book or video
store (which shall mean a store which primarily sells or offers for sale
sexually explicit printed materials, audio or video tapes, or sexual devices),
or flea market.
| 5.2 |
Compliance
|
Tenant,
at Tenant’s sole expense, promptly shall comply with all applicable statutes,
ordinances, rules, regulations, orders, covenants and restrictions of record,
and requirements of governmental agencies that are in effect during the term
or
any part of the term hereof, regulating the use by Tenant of the
Premises.
5
6.
PROPERTY TAXES, OTHER CHARGES, ASSESSMENTS AND UTILITIES
| 6.1 |
Tenant’s
Required Payments
|
|
6.1.1
|
Tenant
shall pay before delinquency and as additional rent, all Property
Taxes
and Other Charges (as such terms are defined herein) that accrue
prior to,
during, or are otherwise properly allocable to the term of this Lease.
Property Taxes and Other Charges together are referred to herein
as
“Taxes.”
|
|
(i)
|
“Property
Taxes” shall
mean all taxes, assessments, excises, levies, fees, and charges (and
any
tax, assessment, excise, levy, fee, or charge levied wholly or partly
in
lieu thereof or as a substitute therefor or as an addition thereto)
of
every kind and description, general or special, ordinary or extraordinary,
foreseen or unforeseen, secured or unsecured, whether or not now
customary
or within the contemplation of Landlord and Tenant, that are levied,
assessed, charged, confirmed, or imposed on or against the Premises
or any
part thereof It is the intention of Landlord and Tenant that all
new and
increased taxes, assessments, levies, fees and charges be included
within
the definition of Property Taxes for the purpose of this
Lease.
|
|
(ii)
|
“Other
Charges” shall
mean all taxes, assessments, excises, levies, fees, and charges
(including, without limitation, common area
maintenance charges, charges relating to the cost of providing
facilities
or services, and charges relating to documents or instruments of
record
affecting or encumbering the Premises), whether or not now customary
or
within the contemplation of Landlord and Tenant, that are levied,
assessed, charged, confirmed, or imposed upon, or measured by, or
reasonably attributable to (a) the Premises; (b) the cost or value
of any
leasehold improvements made in or to the Premises by or for Tenant,
regardless of whether title to such improvements is vested in Tenant
or
Landlord; (c) Base Monthly Rent and all additional rent payable under
the
Lease, including, if applicable, Property Taxes, Other Charges, insurance,
maintenance, and other costs incurred by Tenant by which Landlord
may
benefit, including, without limitation, any gross income tax or excise
tax
levied by any public or government authority with respect to the
receipt
of any such rents and costs; and (d) this transaction or any document
to
which Tenant is a party creating or transferring an interest or an
estate
in the Premises.
|
6
|
6.1.2
|
During
the term of this Lease, Tenant shall also pay before delinquency,
but not
as additional rent, all taxes, assessments, excises, levies, fees
and
charges, whether or not now customary or within the contemplation
of
Landlord and Tenant, that are levied, assessed, charged, confirmed,
or
imposed upon, or measured by, or reasonably attributable to (a) any
personal property of Tenant used in connection with the Premises;
(b) the
cost or value of Tenant’s furniture, fixtures, equipment, or personal
property located in the Premises; (c) the possession, leasing, operation,
management, maintenance, alteration, repair, use, or occupancy by
Tenant
of the Premises; and (d) any fees, charges, fines, penalties, costs,
assessments, taxes, demands, orders, directives, or other requirements
imposed by any governmental agency asserting jurisdiction, or under
any
Environmental Laws which arise from or relate to Tenant’s use of, or
Tenant’s activities at, the Premises, including, but not limited to,
Storage Tank System registration fees, any other applicable fees,
and any
consultant or attorneys’ fees related to or arising under any
Environmental Laws.
|
|
6.1.3
|
In
addition to the foregoing, during the term of this Lease, Tenant
acknowledges and agrees it is obligated to and shall perform all
obligations of the owner of the Premises under, and pay all expenses
which
the owner of the Premises may be required to pay in accordance with,
any
declarations or reciprocal easement agreements or any other documents
or
instruments of record now affecting the Premises (herein referred
to
collectively as the “REA’s”).
Tenant shall promptly comply with all of the terms and conditions
of the REA’s, including without limitation, all insurance requirements,
regardless of whether any such requirements exceed the requirements
otherwise set forth in Section 10
below.
|
Landlord
shall cooperate with tenant as shall be required for Tenant to comply with
the
foregoing terms and conditions, including executing any documents and
instruments as owner, which shall be required in connection
therewith.
| 6.2 |
Payments
Not Required by Tenant
|
Anything
herein to the contrary notwithstanding, Tenant shall not be required to pay
any
state or federal income or franchise, gross receipts, estate, profits or excise
taxes of Landlord, or any state or federal estate, succession, inheritance,
or
transfer taxes of Landlord or any tax or other charge imposed with respect
to
the sale, exchange, financing or other disposition by Landlord, in whole or
in
part, of the Premises or Landlord’s interest in this Lease, or any sales or rent
taxes or similar charges assessed with respect to the Base Monthly Rent or
any
additional rent due pursuant to this Lease. All of the foregoing taxes shall
not
be deemed to be included in Taxes and are the sole and exclusive responsibility
of the Landlord, and Landlord shall file all required returns and make all
necessary filings in connection therewith.
7
| 6.3 |
Assessments
|
If
any
assessment for a capital improvement made by a public or governmental authority
shall be levied or assessed against the Premises, and the assessment is payable
either in a lump sum or on an installment basis, then Tenant shall have the
right to elect the basis of payment; provided however, throughout the entire
term of this Lease, Tenant shall pay all assessments that accrue prior to,
during, or are otherwise allocable to the term of this Lease.
| 6.4 |
Utility
Payments
|
Tenant
shall pay when due all charges for water, gas, electricity, and all other
utilities furnished to or used upon the Premises during the term of this Lease,
including all charges for installation, termination, and relocations of such
service. Landlord, at its option, following any default by Tenant in making
such
payments, may require Tenant to furnish Landlord with evidence of payment of
such charges.
| 6.5 |
Tenant’s
Right to Contest Utility Charges, Contest Taxes and Seek Reduction
of
Assessed Valuation of the Premises
|
Tenant,
at Tenant’s sole cost and expense, shall have the right, at any time, to seek a
reduction in the assessed valuation of the Premises or to contest any Taxes
or
utility charges that are to be paid by Tenant; provided however, Tenant shall
(i) give Landlord contemporaneous written notice of any contest; (ii) indemnify
and hold Landlord Indemnified Parties (defined below) harmless from all
liability on account of such contest with respect to Property Taxes; (iii)
take
such action as is necessary to remove the effect of any lien which attached
to
any of the Premises or the improvements thereon due to such contest, or in
lieu
thereof, at Landlord’s election, and if required by applicable law, furnish
Landlord with adequate security for the amount of the Taxes due plus interest
and penalties; and (iv) in the event of a final determination adverse to Tenant,
prior to enforcement, foreclosure or sale, pay the amount involved together
with
all penalties, fines, interest, costs, and expenses which may have accrued.
If
Tenant seeks a reduction or contests any Taxes or utility charges, the failure
on Tenant’s part to pay the Taxes or utility charges shall not constitute a
default as long as Tenant complies with the provisions of this Section. Tenant,
on final determination of the proceeding or contest, shall within applicable
grace periods pay or discharge any decision or judgment rendered, together
with
all costs, charges, interest, and penalties incidental to the decision or
judgment.
| 6.6 |
Landlord
Not Required to Join in Proceedings or Contest Brought by
Tenant
|
Landlord
shall not be required to join in any proceeding or contest brought by Tenant
unless the provisions of the law require that the proceeding or contest be
brought by or in the name of Landlord or the owner of the Premises. In that
case, Landlord shall join in the proceeding or contest or permit it to be
brought in Landlord’s name as long as Landlord is not required to bear any
cost.
8
| 6.7 |
Partial
Lease Years and Adjustment of Taxes
|
Property
Taxes (and Other Charges, as may be applicable) payable by Tenant in accordance
with the terms of this Lease shall be appropriately adjusted for any partial
Lease Year at the end of the Term. Upon the Expiration Date, Taxes which have
accrued prior to the Expiration Date and are payable after the Expiration Date,
shall be prorated and apportioned as of the Expiration Date based upon the
actual number of days in the period subject to proration such that Tenant shall
bear all expenses with respect to the Premises up through and including the
Expiration Date. Any amount payable by Tenant shall be remitted to Landlord
within ten (10) business days following the later of (i) the date the amount
payable by Tenant hereunder is determined and (ii) the Expiration Date. Any
excess prepaid Taxes shall be refunded to Tenant by Landlord within ten (10)
business days of the Expiration Date. Taxes which cannot be ascertained with
certainty as of the Expiration Date shall be prorated on the basis of the
parties’ reasonable estimates of such amount(s) and shall be the subject of a
final proration as soon thereafter as the precise amounts can be ascertained.
The provisions of this paragraph shall survive the expiration or termination
of
this Lease.
7.
FURNITURE, FIXTURES AND EQUIPMENT
| 7.1 |
Furniture,
Fixtures, and Equipment
|
During
the term Tenant may, at Tenant’s expense, place or install such furniture, trade
fixtures, equipment, machinery, furnishings, face plates of signage and other
articles of movable personal property (collectively, “Tenant’s
Personal Property”)
on the
Premises as may be needed for the conduct of Tenant’s business. It is expressly
understood that the term Tenant’s Personal Property as used herein shall in no
event extend to leasehold improvements, fixtures or similar “vanilla shell”
items such as light fixtures, HVAC equipment, or other fixtures and equipment
permanently affixed to the Premises. Tenant is authorized to access Tenant’s
Personal Property for maintenance, repair and replacement purposes during the
term of this Lease.
| 7.2 |
Landlord’s
Waiver
|
Tenant
may finance Tenant’s Personal Property at any time and from time to time during
the term of this Lease. Upon request of Tenant, Landlord shall execute and
deliver to any lender a Landlord’s Waiver in such form as shall be requested by
Tenant and reasonably acceptable to Landlord. Tenant may remove and replace
Tenant’s Personal Property periodically during the term of this
Lease.
| 7.3 |
Removal
of Tenant’s Personal Property at Expiration of
Lease
|
At
any
time up to and including the expiration or earlier termination of the Lease,
all
or any part of Tenant’s Personal Property may be removed at the option of
Tenant. At the expiration or earlier termination of the Lease, Landlord may
require Tenant to remove Tenant’s Personal Property within five (5) business
days following receipt of written notice from Landlord. Tenant immediately
shall
make such repairs and restoration of the Premises as may be necessary to repair
any damage to the Premises from the removal of Tenant’s Personal Property. Any
of Tenant’s Personal Property not so removed shall be deemed abandoned, and
Landlord may cause such property to be removed from the Premises and disposed
of, but the reasonable cost of any such removal shall be borne by Tenant. The
provisions of this paragraph shall survive the expiration or termination of
this
Lease.
9
| 7.4 |
Right
to Affix Signs
|
Tenant
shall have the right to decorate the Premises and affix signs customarily used
in its business upon the windows, doors, interior and exterior walls of the
Premises, and such free-standing signs as may seem appropriate to Tenant and
are
in compliance with applicable laws and are not expressly prohibited by any
covenants, conditions and restrictions encumbering the Premises. Upon the
expiration or earlier termination of the Lease, Tenant shall remove such signs
within a reasonable time following the expiration or earlier termination of
the
Lease. Tenant promptly shall make such repairs and restoration of the Premises
as are necessary to repair any damage to the Premises from the removal of the
signs.
8.
MAINTENANCE AND REPAIRS OF THE PREMISES
| 8.1 |
Obligation
to Maintain the Premises
|
During
the term of this Lease, Tenant shall, at its own expense, keep and maintain
the
entirety of the Premises in good order and repair, ordinary wear and tear
excepted, including, but not limited to, the interior, exterior, foundations,
floors, walls, roof and structure of the building; the sidewalks, curbs, trash
enclosures, landscaping with sprinkler system (if installed), light standards,
and parking areas which are a part of the Premises. Tenant shall make such
repairs and replacements as may be necessary, regardless of whether the benefit
of such repair or replacement extends beyond the term of this Lease. The
Premises shall be returned to Landlord at the termination or expiration of
this
Lease in as good condition as received, ordinary wear and tear and casualty
excepted. In the event of destruction of the Premises or any portion thereof
by
fire or casualty, the condition of the Premises upon termination of this Lease
shall be governed
by
Section 11. Landlord shall have no obligation whatsoever to alter, remodel,
improve, repair, renovate, retrofit or maintain the Premises or any portion
thereof.
| 8.2 |
Obligation
to Keep the Premises Clear
|
Tenant
shall keep the Premises, including sidewalks adjacent to the Premises and
loading area allocated for the use of Tenant, clean and free from rubbish and
debris at all times. Tenant shall store all trash and garbage within the
Premises and arrange for regular pickup and cartage of such trash and garbage
at
Tenant’s expense.
10
9.
ALTERATIONS AND IMPROVEMENTS
| 9.1 |
Right
to Make Alterations
|
At
all
times during the term of this Lease, Tenant shall have the right to make
alterations, additions and improvements (collectively, “Alterations”)
to
the
interior or exterior of the Premises and parking areas adjacent to the Premises
as more particularly set forth herein. Tenant shall have the right to make
Alterations including, without limitation, the addition of food service items,
in its reasonable business judgment at any time to the extent such Alterations
are non-structural in nature; provided, however Tenant shall give Landlord
at
least ten (10) days’ prior written notice, for information purposes only, of the
commencement of any such non-structural Alterations that will cost in excess
of
Four Hundred Thousand Dollars ($400,000). Notwithstanding the foregoing,
Alterations that are structural in nature and which will cost in excess of
Fifty
Thousand Dollars ($50,000) shall not be made by Tenant without the prior written
consent of Landlord, which consent shall not be unreasonably withheld or
delayed, and which shall be deemed given if not denied within ten (10) business
days after notice to Landlord. Any Alterations made or installed by Tenant
shall
remain upon the Premises and, at the expiration or earlier termination of this
Lease, shall be surrendered with the Premises to Landlord. All Alterations
shall
be accomplished by Tenant in a good, expeditious, quality workmanlike manner,
in
conformity with applicable laws, regulations, ordinances, orders and covenants,
conditions and restrictions encumbering the Premises. Landlord may, if required
by applicable
law, enter upon the Premises for the purpose of posting appropriate notices,
including, but not limited to, notices of non-responsibility, provided that
Landlord shall give reasonable notice to Tenant and shall not unreasonably
interfere with the progress of such work. Landlord agrees to cooperate with
Tenant in filing for any required permits and authorizations from the applicable
governmental authorities.
| 9.2 |
Tenant
Shall Not Render Premises Liable For Any
Lien
|
Tenant
shall have no right, authority, or power to bind Landlord, or any interest
of
Landlord in the Premises, nor to render the Premises liable for any lien or
right of lien for the payment of any claim for labor, material, or for any
charge or expense incurred to maintain, to repair, or to make Alterations to
the
Premises. Tenant shall in no way be considered the agent of Landlord in the
construction, erection, modification, repair, or alteration of the Premises.
Notwithstanding the above, Tenant shall have the right to contest the legality
or validity of any lien or claim filed against a Premises. No contest shall
be
carried on or maintained by Tenant after the time limits in the sale notice
of
the Premises for any such lien or claim unless Tenant (i) shall have duly paid
the amount involved under protest; (ii) shall have procured and recorded a
lien
release bond or other security reasonably acceptable to Landlord in an amount
reasonably necessary to prevent a foreclosure of the Premises as a result of
such lien or claim during the pendency of such contest; or (iii) shall have
procured a stay of all proceedings to enforce collection. Upon a final adverse
determination of any contest, Tenant shall pay and discharge the amount of
the
lien or claim determined to be due, together with any penalties, fines,
interest, cost, and expense which may have accrued, and shall provide proof
of
payment to Landlord.
11
10.
INDEMNITY AND INSURANCE
| 10.1 |
Indemnification
|
Tenant
shall indemnify, defend, and protect Landlord, its agents, employees, officers,
affiliates, investors, partners and lenders (the “Landlord
Indemnified Parties”)
and
hold Landlord Indemnified Parties harmless, from any and all loss, cost, damage,
expense and/or liability (including, without limitation, court costs and
reasonable attorneys’ fees) incurred in connection with or arising at any time
and from any cause whatsoever in or about the Premises which results from or
relates to any claim brought by any person other than Landlord Indemnified
Parties, other than any such loss, cost, damage, expense and/or liability caused
by reason of the gross negligence or willful misconduct of Landlord Indemnified
Parties including, without limiting the generality of the foregoing: (i) any
default by Tenant in the observance or performance of any of the terms,
covenants, or conditions of this Lease on Tenant’s part to be observed or
performed; (ii) any condition of or on the Premises arising prior to the
expiration of the term of the Lease or any occurrence or happening on the
Premises arising prior to the expiration of the term of the Lease from any
cause
whatsoever, unless such condition, occurrence or happening shall have been
caused by the gross negligence or willful misconduct of Landlord Indemnified
Parties; or (iii) any acts, omissions, or negligence of Tenant or any person
claiming by, through, or under Tenant, or of the contractors, agents, servants,
employees, visitors, or licensees of Tenant in, on, or about the Premises,
prior
to the expiration of the Lease term (including, without limitation, any
holdovers in connection therewith), including, without limitation, any acts,
omissions, or negligence in the making or performance of any alterations,
provided that this Section shall not apply to any environmental or occupational
health matter whatsoever in that Article 22 deals with any indemnification
or
other arrangement between the parties with respect thereto. The provisions
of
this Section shall survive the expiration or sooner termination of this
Lease.
| 10.2 |
Insurance
Company Requirement
|
Insurance
required by this Lease shall be issued by companies holding a general
policyholder’s rating of A-VIII or better as set forth in the most current issue
of Best’s
Insurance Guide
and
authorized to do business in the states in which the Premises are located.
If
this publication is discontinued, then another insurance rating guide or service
generally recognized as authoritative shall be substituted by
Landlord.
| 10.3 |
Insurance
Certificate Requirements
|
|
10.3.1
|
Within
ten (10) business days following Landlord’s request therefore, Tenant
shall deliver to Landlord (i) evidence of the existence and amounts
of the
insurance with additional insured endorsements and loss payable clauses
as
required herein, and (ii) a Certificate of Liability Insurance in
connection with Tenant’s liability policy(ies), and an Evidence of
Property Insurance in connection with Tenant’s property policy(ies). No
policy shall be cancelable or subject to reduction of coverage or
other
material modification except after ten (10) days’ prior written notice to
Landlord. Neither the issuance of any insurance policy required hereunder,
nor the minimum limits specified herein with respect to any insurance
coverage, shall be deemed to limit or restrict in any way the liability
of
Tenant arising under or out of this
Lease.
|
12
|
10.3.2
|
The
insurance required to be maintained herein may be carried under blanket
or
umbrella policies.
|
| 10.4 |
Minimum
Acceptable Insurance Coverage
Requirements
|
|
10.4.1
|
Tenant
shall, at Tenant’s expense, obtain and keep in full force during the term
of this Lease a policy of combined single limit bodily injury and
property
damage insurance written on an occurrence basis insuring Tenant (with
Landlord as an additional insured) against any liability arising
out of
ownership, use, occupancy, or maintenance of the Premises. The insurance
shall be in an amount not less than One Million Dollars ($1,000,000)
per
occurrence; provided however, following receipt of written notice
from
Landlord the limits of such insurance shall be increased from time
to time
during the term of the Lease to such amount as may be deemed commercially
reasonable by Landlord but which shall not be in excess of the limits
generally applicable to other similar businesses. The policy shall
provide
blanket contractual liability coverage. However, the limits of the
insurance shall not limit the liability of Tenant. In addition, Tenant
shall, at Tenant’s expense, obtain and keep in full force during the term
of this Lease an umbrella liability policy in an amount not less
than Six
Million Dollars ($6,000,000) in excess of primary insurance. The
insurance
to be maintained by Tenant pursuant to this Section 10.4.1 shall
be
primary and not contributory to any other insurance maintained by
Landlord.
|
|
10.4.2
|
Tenant
shall, at Tenant’s expense, obtain and keep in force during the term of
this Lease a “Special Form” (as such term is used in the insurance
industry) policy of property insurance covering loss or damage to
the
Premises. The insurance shall be in an amount not less than the full
guaranteed replacement cost of the building(s) (less slab, foundation,
supports and other customarily excluded improvements). The policy
shall
contain only standard printed exclusions and include an ordinance
or law
coverage endorsement covering increased costs resulting from changes
in
laws or codes, and demolition and removal of the damaged structure.
In
addition, the policy shall include an endorsement naming Landlord
as “Loss
Payee” thereunder; provided, however, notwithstanding the foregoing,
payments up to and including Two Hundred Fifty Thousand Dollars ($250,000)
shall be made directly to Tenant, and payments in excess of such
amount
shall be made jointly to Landlord and Tenant. In no event shall any
deductible payable in connection with such policy exceed the higher
of (i)
Five Hundred Thousand Dollars ($500,000), as such amount shall be
increased by a percentage equal to the percentage increase in the
Base
Monthly Rent pursuant to this Lease from time to time, or (ii) Twenty
Five
percent (25%) percent of the aggregate limit of liability under such
policy.
|
13
|
10.4.3
|
If
the Premises are located in Flood Zone A or V as defined by the Federal
Emergency Management Agency (FEMA), Tenant shall, at Tenant’s expense,
obtain and keep in force during the term of this Lease a policy of
insurance covering loss or damage due to flood with respect to the
Premises. Tenant may obtain such insurance through any available
governmental programs providing for such coverage. Notwithstanding
the
foregoing, Tenant shall have the right to self-insure with respect
to such
insurance to the extent such self-insurance is not prohibited under
the
laws of the state where the Premises are
located.
|
|
10.4.4
|
If
the Premises are located within the State of California, or in any
county
which is classified as being in an earthquake territory 1 through
11 by
Insurance Services Office (“ISO”)
or
an earthquake zone of 1 through 3 by ISO, Tenant shall, at Tenant’s
expense, obtain and keep in force during the term of this Lease a
policy
of insurance covering loss or damage due to earthquake with respect
to the
Premises. Tenant may obtain such insurance through any available
governmental programs providing for such coverage. Notwithstanding
the
foregoing, Tenant shall have the right to self-insure with respect
to such
insurance to the extent such self-insurance is not prohibited under
the
laws of the state where the Premises are
located.
|
|
10.4.5
|
Tenant
shall also obtain and keep in force during the term of this Lease
a
worker’s compensation policy, insuring against and satisfying Tenant’s
obligations and liabilities under the worker’s compensation laws of the
state in which the Premises is located, including Employer’s Liability
insurance, in an amount of not less than Five Hundred Thousand Dollars
($500,000). Notwithstanding the foregoing, Tenant shall have the
right to
self-insure with respect to worker’s compensation to the extent such
self-insurance is not prohibited under the laws of the state where
the
Premises are located.
|
|
10.4.6
|
Should
any financial assurance requirements pursuant to Environmental Laws
be
imposed on Tenant’s use of, or activities at, the Premises, Tenant
promptly and timely shall comply with those requirements as they
take
effect. Tenant shall maintain pollution liability insurance in favor
of
Landlord which names Landlord as an additional insured as set out
in
Section 10.5 herein, and any third parties which might be affected,
in an
amount of at least One Million Dollars ($1,000,000) per occurrence
providing coverage for the investigation and/or remediation of any
Hazardous Materials released at, on, under or from the Premises,
property
damage (including, without limitation, natural resource damages)
and
compensation for personal injuries (“Environmental
Insurance”). Within
ten (10) business days following Landlord’s request therefor, Tenant shall
provide a certificate of insurance evidencing such required coverage
prior
to the Commencement Date, and such certificate shall provide that
the
policy may not be cancelled or amended in any material respect without
thirty (30) days’ prior written notice to Landlord. Tenant may obtain all
or any portion of such insurance through any available governmental
programs or funds providing such coverage.
|
14
|
10.4.7
|
If
attached, Landlord acknowledges that the insurance described in the
certificate of liability insurance and evidence of property insurance
attached hereto as Exhibit
“C”
substantially satisfies the requirements of this
Section.
|
| 10.5 |
Additional
Insureds
|
Tenant
shall name Landlord and Landlord’s successor(s) and assignee(s), and any other
affiliate or lender of Landlord as Landlord may designate from time to time,
as
additional insureds and loss payees on all insurance.
| 10.6 |
Mortgage
Endorsement
|
If
requested by
Landlord, the policies of insurance required to be maintained hereunder shall
bear a standard first mortgage endorsement in favor of any holder or holders
of
a first mortgage lien or security interest in the Premises with loss payable
to
such holder or holders as their interests may appear.
| 10.7 |
Renewals,
Lapses or Deficiencies
|
Tenant
shall, within ten (10) days of the expiration of such policies, furnish Landlord
with renewal certificates of insurance or renewal binders. In the event of
a
lapse or deficiency of any insurance coverage specified herein for any reason,
Landlord may immediately replace the deficient insurance coverage with a policy
of insurance covering the Premises of the type and in the limits set forth
above. Upon written notice from Landlord of the placement of insurance, Tenant
shall immediately pay to Landlord, as additional rent, an amount equal to the
total cost of premiums and expense of such insurance placement. Tenant shall
not
do or permit to be done anything that shall invalidate the insurance
policies.
15
| 10.8 |
Waiver
of Subrogation
|
Landlord
and Tenant hereby release each other from liability caused by fire or other
casualty for which insurance is carried hereunder by the party sustaining the
loss, damage or injury at the time of such loss, damage or injury to the extent
of any recovery by the injured party under such insurance, or what would have
been recovered had such party carried the insurance required hereunder. Landlord
and Tenant shall use reasonable efforts to obtain waivers of subrogation rights
by the insurer against Landlord or Tenant, as the case may be, in all casualty
insurance policies affecting any portion of any of the Premises in which
Landlord or Tenant is not a named insured.
11.
PARTIAL AND TOTAL DESTRUCTION OF THE PREMISES
| 11.1 |
Damage
or Destruction of Premises
|
In
the
event any part or all of the Premises shall at any time during the term
of
this Lease be damaged in any material respects or destroyed, regardless of
cause, Tenant shall give prompt notice to Landlord. Tenant shall repair and
restore the Premises to at least the condition it was in immediately prior
to
the occurrence of such damage, including buildings and all other improvements
on
the Premises, as soon as circumstances permit and to the extent permitted by
applicable law. Tenant shall hold Landlord free and harmless from any and all
liability of any nature whatsoever resulting from such damage or destruction,
and such repairs and restoration. Tenant, and not Landlord, shall be responsible
for paying for any cost of repairs and restoration in excess of the proceeds
available from insurance policies maintained by Tenant (“Tenant’s
Policies”).
Tenant is
not
entitled to any rent abatement during or resulting from any disturbance from
partial or total destruction of the Premises, and in no event shall Tenant
be
entitled to terminate the Lease. Notwithstanding the foregoing, Tenant’s
obligation to restore the Premises is conditioned upon (i) Landlord and the
holders of any mortgage liens on the Premises making available to Tenant all
insurance proceeds from Tenant’s Policies paid in connection with the loss, if
any, which insurance proceeds shall be applied to restoration and (ii) Tenant
being able to restore the Premises to a use and configuration which is the
same
as the Premises’ use and configuration immediately prior to the damage or
destruction.
| 11.2 |
Damage
or Destruction During the Last Twenty-four (24) Months of the
Term
|
Notwithstanding
anything contained herein to the contrary, Tenant may terminate this Lease
upon
giving written notice to Landlord within thirty (30) days following the date
upon which the Premises or any Storage Tank System is damaged or destroyed,
provided: (i) such damage or destruction occurs within the last two (2) years
of
the Primary Term or any Extension Period and (ii) the Premises is totally or
substantially damaged or destroyed (as defined below). Tenant shall timely
file
an appropriate claim with its insurance carrier (in the event of an insured
casualty) in connection with such damage or destruction and thereafter promptly
pay over to Landlord the entirety of insurance proceeds received in connection
with the loss, other then any proceeds attributable to Tenant’s Personal
Property (the “Insurance
Proceeds”).
Tenant shall
within ten (10) days after the date of Tenant’s termination notice to Landlord
pay to Landlord a sum equal to the entirety of the self-insured retention,
if
any, in respect of the Premises. As used herein, the phrase “substantially
damaged or destroyed” shall mean that the restoration or repair cost as
estimated by at least two (2) reputable general contractors properly licensed
in
the State in which the Premises is located and reasonably acceptable to and
approved by Landlord, exceeds twenty five percent (25%) of the replacement
value
of the improvements immediately prior to such damage or
destruction.
16
In
the
event Tenant shall have terminated the Lease as provided in the immediately
preceding paragraph, Landlord and Tenant shall be released from all obligations
and liabilities under the Lease, with the exception of those liabilities which
accrued prior to the termination date and those obligations which, pursuant
to
the terms of the Lease, accrued prior to the termination date and survive
termination or expiration of the Lease.
12.
CONDEMNATION
| 12.1 |
Condemnation
Damages
|
In
the
event of the taking or conveyance of the whole or any part of the Premises
by
reason of condemnation by any public or quasi-public body (“Condemnation”),
Landlord and
Tenant shall represent themselves independently in seeking damages before the
condemning body. Each party shall be entitled to the amount awarded or
apportioned respectively to each. Landlord shall be entitled to the entirety
of
the award with the exception of the following:
|
12.1.1
|
Any
portion of the award attributable to Tenant’s leasehold improvements made
to the Premises by Tenant in accordance with this Lease, which
improvements Tenant has the right to remove from the Premises upon
the
expiration or termination of the Lease pursuant to the provisions
of this
Lease, but elects not to remove;
|
|
12.1.2
|
Any
portion of the award attributable to Tenant’s Personal Property installed
in the Premises in accordance with this Lease, which Tenant has the
right
to remove from the Premises upon the expiration or termination of
the
Lease pursuant to the provisions of this Lease, but which are to
remain in
the Premises as a result of such taking;
and
|
|
12.1.3
|
Any
portion of the award attributable to: (i) removing Tenant’s Personal
Property; (ii) removing or relocating the Storage Tank System; (iii)
damage or loss to Tenant’s business and good will and (iv) moving and
relocation expenses.
|
| 12.2 |
Termination
of Lease Due to Condemnation
|
In
the
event the Condemnation materially adversely affects the use by Tenant of the
Premises, Tenant may terminate the Lease by giving Landlord written notice
of
its intention to terminate the Lease within sixty (60) days of receipt of
written notice of the Condemnation. The effective date of the termination shall
be the date upon which fee simple interest is vested in the condemning
authority, and Tenant shall be released from further obligations or liabilities
thereafter arising under the Lease. In the event of termination, Base Monthly
Rent, Property Taxes, Other Charges and any other items of additional rent
(collectively, “Rent
and Charges”) shall
be
prorated based upon the actual number of days in the period to be prorated.
Within thirty (30) days following the termination, Landlord shall refund to
Tenant any Rent and Charges paid to Landlord in advance of the termination.
In
the event Tenant elects not to terminate the Lease, Tenant may elect either
to
(i) require Landlord to pay over to Tenant the entire Condemnation award
attributable to restoration of the Condemned Property, and Tenant shall restore
the Condemned Property to as close to its condition prior to such condemnation
as is reasonably possible, in which event the Base Monthly Rent shall not ▇▇▇▇▇,
or (ii) require Landlord to pay over to Tenant a portion of such Condemnation
award equal to a percentage that the value of the Premises, in Tenant’s
reasonable determination, following such condemnation bears the value of the
Premises immediately before such Condemnation (“Post Condemnation Value
Percentage”), in which event the Monthly Base Rent shall be abated by a
percentage equal to 100% less the Post-Condemnation Value
Percentage.
17
13.
ASSIGNMENT AND SUBLETTING
| 13.1 |
Tenant’s
Right of Assignment and Subletting
|
Except
as
otherwise set forth in this Section or in Section 19.5, Tenant shall not
voluntarily or by operation of law assign or encumber its interest in this
Lease
or in the Premises, without first obtaining the written consent of Landlord,
which consent shall not be unreasonably withheld or delayed.
| 13.2 |
Assignment
Without Landlord’s Consent
|
So
long
as no monetary Event of Default remains uncured at the time of the assignment,
Tenant shall have the right to assign its interest in this Lease without the
consent of Landlord: (i) to a Related Entity (as defined below); (ii) in
connection with a merger, consolidation or acquisition involving the entirety
of
Tenant; or (iii) to any entity acquiring all or substantially all of Tenant’s
assets; provided that: (a) Tenant shall notify Landlord in writing of the
occurrence of any of the foregoing events within thirty (30) days, and shall
provide a true and correct copy of the assignment and assumption agreement,
together with such other documentation supporting or evidencing said event
as
may be reasonably requested by Landlord; and (b) the transferee assumes all
of
Tenant’s obligations hereunder in writing and agrees to perform all of the
obligations of Tenant under this Lease. Upon such assumption by transferee
Tenant shall be relieved and discharged from its liabilities, obligations or
duties under this Lease accruing subsequent to the effective date of any such
transfer. The term “Related
Entity,” as
used
herein, means any person or entity which, directly or indirectly, controls,
or
is controlled by, or is also controlled by the same entity having a controlling
interest in Tenant.
18
| 13.3 |
Assignment
with Landlord’s Consent
|
In
addition to any assignments pursuant to Section 13.2, so long as no
monetary Event
of
Default remains uncured at the time of the assignment, Landlord shall not
unreasonably withhold consent to an assignment of this Lease to an individual
or
entity if such individual or entity has, in the reasonable opinion of Landlord,
a record of timely payment of obligations and compliance with applicable laws,
is a commercially and financially sound individual or entity, and has at least
three (3) years of operating history reasonably acceptable to Landlord with
respect to convenience stores. Tenant shall submit current financial statements
of any proposed assignee together with Tenant’s request for Landlord’s approval
of any proposed assignment. Tenant shall reimburse Landlord for all reasonable
costs and expenses (including, without limitation, attorneys’ fees and expenses)
actually paid by Landlord in connection with any requested assignment. Tenant
expressly acknowledges and agrees that in the event of an assignment of this
Lease, Tenant shall remain jointly and severally liable with the assignee for
all of the obligations under this Lease, unless released by Landlord in writing
pursuant to the terms of this Lease.
| 13.4 |
Subletting
Without Landlord’s Consent
|
So
long
as no Event of Default remains uncured at the time of the sublease, Tenant
shall
have the right to sublease or grant a license or franchise in connection with
the Premises (including, without limitation, the addition of any quick service
restaurant concepts or brands at any of the Premises, or the conversion of
any
existing quick service restaurant concepts or brands to another restaurant
or
concept, whether or not any sublease, license or franchise is to be granted
in
relation to the foregoing) without the consent of Landlord; provided that such
use complies with Section 5.1 and Tenant shall notify Landlord in writing of
the
occurrence of any such event, and shall provide a true and correct copy of
the
sublease, license agreement or other relevant document, together with such
other
documentation supporting or evidencing said event as may be reasonably requested
by Landlord. In no event shall Tenant be relieved or discharged from its
liabilities, obligations, or duties under this Lease accruing subsequent to
the
effective date of any such subleasing.
| 13.5 |
Landlord’s
Option to Preserve Subtenancies
|
In
the
event of Tenant’s surrender of this Lease or the termination of this Lease in
any other manner, Landlord shall, at Landlord’s option, succeed to the interest
of Tenant as sublandlord thereunder, except that Landlord shall not be liable
for any defaults of Tenant occurring prior to the date of such surrender or
termination. No merger shall result from Tenant’s sublease of the Premises under
this Section, Tenant’s surrender of this Lease, or the termination of this Lease
in any other manner.
| 13.6 |
Rent
from Subletting
|
Upon
the
occurrence and during the continuance of a material Event of Default, Landlord
may, upon written notice to Tenant and any subtenant of all or a part of the
Premises, require any such subtenant to pay all rent from such subletting during
such period directly to Landlord.
19
| 13.7 |
Continuing
Obligation of Tenant
|
Landlord’s
acceptance of rent from any other person is not a waiver of any provision of
this Section. Consent to one transfer is not a consent to any subsequent
transfer. Landlord may consent to subsequent assignments or modifications of
this Lease by Tenant’s assignee, without notifying Tenant or obtaining its
consent. Such action shall not relieve Tenant’s liability under this Lease,
except that Tenant shall not be liable for any extension of the term, increase
in rentals or any modification to this Lease which increases Tenant’s liability
hereunder or reduces Tenant’s rights hereunder made without Tenant’s prior
written consent. The foregoing provisions shall not be deemed to require
Landlord’s consent to any such transfer or any such subsequent transfer if such
consent is not otherwise required pursuant to this Section.
| 13.8 |
Landlord’s
Right of Assignment
|
Landlord
shall be free at all times, without need of consent or approval by Tenant,
to
assign its interest in this Lease and/or to convey fee title to the Premises
or
to mortgage its interest in the Premises. Each conveyance by Landlord of
Landlord’s interest in the Lease or the Premises prior to expiration or
termination hereof shall be subject to this Lease. Landlord or its successor
shall give Tenant written notice of such assignment or conveyance, as
applicable, and after such assignment or conveyance, the grantor shall be
relieved of any obligations or liability as Landlord first arising after the
date of such conveyance, and Tenant shall look solely to Landlord’s successor in
interest for all future obligations of Landlord. Tenant hereby agrees to attorn
to Landlord’s successors in interest, whether such interest is acquired by sale,
transfer, foreclosure, deed in lieu of foreclosure, or otherwise. The term
“Landlord” as used in this Lease, so far as covenants and obligations on the
part of Landlord are concerned, shall be limited to mean and include only the
owner at the time in question of the fee title of the Premises. Without further
agreement, the transferee of such title shall be deemed to have assumed and
agreed to observe and perform any and all obligations of Landlord hereunder
during its ownership of the Premises.
14.
DEFAULT AND TERMINATION
| 14.1 |
Event
of Default
|
The
occurrence of any of the following events (each an “Event
of Default”) shall
constitute a default by Tenant:
|
14.1.1
|
Monetary
Default: Failure by Tenant to pay rent or any other monetary obligation
(“rent”) when due if the failure is not cured within ten
(10) days after notice has been given to
Tenant.
|
|
14.1.2
|
Non-monetary
Default: Failure by Tenant to perform or comply with any provision
of this
Lease (other than as set forth in the immediately preceding subsection)
in
any material respects if the failure is not cured within thirty (30)
days
after notice has been given to Tenant. If, however, the failure cannot
reasonably be cured within the cure period, Tenant shall not be in
default
of this Lease if Tenant commences to cure the failure within the
cure
period and diligently and in good faith continues to cure the
failure.
|
20
|
14.1.3
|
To
the extent permitted by law, a general assignment by Tenant for the
benefit of creditors, or the filing by or against Tenant of any proceeding
under any insolvency or bankruptcy law, unless in the case of a proceeding
filed against Tenant the same is dismissed within ninety (90) days,
or the
appointment of a trustee or receiver to take possession of all or
substantially all of the assets of Tenant, unless possession is restored
to Tenant within sixty (60) days, or any execution or other judicially
authorized seizure of all or substantially all of Tenant’s assets located
upon the Premises or of Tenant’s interest in this Lease, unless such
seizure is discharged within sixty (60)
days.
|
|
14.1.4
|
Any
notice delivered pursuant to this Section shall be in lieu of, and
not in
addition to, any notice required by
law.
|
| 14.2 |
Landlord’s
Remedies
|
Landlord
shall have any one or more of the following remedies after the occurrence of
an
uncured Event of Default by Tenant. These remedies are not exclusive; they
are
cumulative in addition to any remedies now or later allowed by law, in equity,
or otherwise:
|
14.2.1
|
Terminate
this Lease by giving written notice of termination to Tenant, in
which
event Tenant immediately shall, subject to section 7.3, surrender
the
Premises to Landlord. If Tenant fails to so surrender the Premises,
then
Landlord, without prejudice to any other remedy it has for possession
of
the Premises or arrearages in rent or other damages, may re-enter
and take
possession of the Premises and subject to Section 7.3 expel or remove
Tenant and any other person or entity occupying the Premises or any
part
thereof, without being liable for any damages, except if caused by
gross
negligence or willful misconduct of
Landlord.
|
|
14.2.2
|
No
act by Landlord other than giving notice of termination to Tenant
shall
terminate this Lease. Acts of maintenance, efforts to relet the Premises,
or the appointment of a receiver on Landlord’s initiative to protect
Landlord’s interest under this Lease shall not constitute a termination of
this Lease. On termination of the Lease, Landlord shall have the
right to
recover from Tenant:
|
|
(i)
|
The
worth at the time of the award of the unpaid rent that had been earned
at
the time of termination of this Lease;
and
|
21
|
(ii)
|
The
worth at the time of the award of the amount by which the unpaid
rent that
would have been earned after the date of termination of this Lease
until
the time of award exceeds the amount of the loss of rent that Tenant
proves reasonably could have been avoided;
and
|
|
(iii)
|
The
worth at the time of the award of the amount by which the unpaid
rent for
the balance of the term after the time of award exceeds the amount
of the
loss of rent that Tenant proves reasonably could have been avoided;
and
|
|
(iv)
|
Any
other amount, including, without limitation, attorneys’ fees and court
costs, necessary to compensate Landlord for all detriment proximately
caused by Tenant’s default.
|
The
phrase
“worth
at the time of the award” as
used
in clauses (i) and (ii) above is to be computed by allowing interest at the
Default Rate (as hereinafter defined), but not to exceed
the then legal rate of interest. The same phrase as used in clause (iii)
above
is to be computed by discounting the amount at the Prime Rate (as hereinafter
defined).
The
term
“rent”
as
used
in this Section means all sums payable by Tenant pursuant to the Lease,
including, without limitation, all Base Monthly Rent, additional rent, Taxes,
and insurance.
|
14.2.3
|
Landlord
may re-enter and take possession of the Premises without terminating
this
Lease and without being liable for any damages, except if caused
by the
gross negligence or willful misconduct of Landlord, and take such
actions
as Tenant is required by the terms of this Lease to take. Landlord
may
relet the Premises, or any part of them, to third parties, but has
no
obligation to do so. Landlord may relet the Premises on whatever
terms and
conditions Landlord, in its sole discretion, deems advisable. Reletting
can be for a period shorter or longer than the remaining term of
this
Lease. Landlord’s action under this Subsection is not considered an
acceptance of Tenant’s surrender of the Premises unless Landlord so
notifies Tenant in writing. Tenant shall be immediately liable to
Landlord
for all costs Landlord incurs in reletting the Premises, including
brokers’ commissions, expenses of remodeling the Premises required by the
reletting, and like costs. Tenant shall pay to Landlord the rent
due under
this Lease on the dates the rent is due, less the rent Landlord receives
from any reletting. Landlord agrees to use commercially reasonable
efforts
to mitigate damages.
|
22
If
Landlord elects to relet the Premises without terminating this Lease, any rent
received will be applied to the account of Tenant, not to exceed the amounts
owed by Tenant to Landlord; no reletting by Landlord is considered to be for
its
own account unless Landlord has notified Tenant in writing that the Lease has
been terminated. If Landlord elects to relet the Premises, rent that Landlord
receives from reletting will be applied to the payment of: (i)
first, any amounts owing from Tenant to Landlord other than rent due from
Tenant; (ii) second, all reasonable and actual costs, including maintenance,
incurred by Landlord in reletting; and (iii) third, rent due and unpaid under
the Lease. After deducting the payments referred to in this Subsection, any
sum
remaining from the rent Landlord receives from reletting will be held by
Landlord and applied in payment of future rent as rent becomes due under this
Lease. If, on the date rent is due under this Lease, the rent received from
the
reletting is less than the rent due on that date, Tenant will pay to Landlord,
in addition to the remaining rent due, all reasonable and actual costs,
including maintenance, Landlord incurred in reletting which remain after
applying the rent received from
the
reletting. Tenant shall have no right to or interest in the rent or other
consideration received by Landlord from reletting to the extent it exceeds
all
amounts owing by Tenant to Landlord.
|
14.2.4
|
In
all events, Tenant is liable for all direct or proximate damages
of
whatever kind or nature, suffered by Landlord as a result of the
occurrence of an Event of Default. If Tenant fails to pay Landlord
in a
prompt manner for the damages suffered, Landlord may pursue a monetary
recovery from Tenant. Included among these damages are all expenses
incurred by Landlord in repossessing the Premises (including, but
not
limited to, increased insurance premiums resulting from Tenant’s vacancy),
all reasonable and actual expenses incurred by Landlord in reletting
the
Premises (including, but not limited to, those incurred for
advertisements, brokerage fees, repairs, remodeling, and replacements),
all concessions granted to a new tenant on a reletting, (including,
but
not limited to, any unamortized commissions paid in connection with
this
Lease), and all reasonable attorneys’ fees incurred by Landlord in
enforcing any of Landlord’s rights or remedies against
Tenant.
|
|
14.2.5
|
Pursuit
of any of the foregoing remedies does not constitute an irrevocable
election of remedies nor preclude pursuit of any other remedy provided
elsewhere in this Lease or by applicable law, and none is exclusive
of
another unless so provided in this Lease or by applicable law. Likewise,
forbearance by Landlord to enforce one or more of the remedies available
to it on an Event of Default does not constitute a waiver of that
default
or of the right to exercise that remedy later or of any rent, damages,
or
other amounts due to Landlord
hereunder.
|
23
|
14.2.6
|
Whether
or not Landlord elects to terminate this Lease or Tenant’s right to
possession of the Premises on account of any uncured Event of Default
by
Tenant, Landlord shall have all rights and remedies at law or in
equity,
including, but not limited to, the right to re-enter the Premises,
in
which event Landlord shall automatically succeed to Tenant’s interest in
such subleases, licenses, concessions, or
arrangements.
|
| 14.3 |
Right
of Landlord to Re-Enter
|
In
the
event of any termination of this Lease as a result of Tenant’s
default
hereunder,
Landlord shall have the immediate right to enter upon and repossess the
Premises, and, subject to Section 7.3, any personal property of Tenant may
be
removed from the Premises and stored in any public warehouse at the risk and
expense of Tenant.
| 14.4 |
Surrender
of Premises
|
No
act or
thing done by Landlord or Tenant or any agent or employee thereof during the
Lease term shall be deemed to constitute an acceptance by Landlord or Tenant,
as
the case may be, or a surrender of any or all of the Premises unless such intent
is specifically acknowledged in a writing signed by Landlord or Tenant, as
the
case may be. The delivery of keys to any of the Premises to Landlord or any
agent or employee of Landlord shall not constitute a surrender of the Premises
or effect any partial or full termination of this Lease, whether or not the
keys
are thereafter retained by Landlord and, notwithstanding such delivery, Tenant
shall be entitled to the return of such keys at any reasonable time upon request
until this Lease shall have been terminated properly. The voluntary or other
surrender of this Lease by Tenant, whether accepted by Landlord or not, or
a
mutual termination hereof, shall not work a merger, and at the option of
Landlord shall operate as an assignment to Landlord of all subleases or
subtenancies affecting the Premises.
| 14.5 |
Interest
Charges
|
Any
amount not paid by one party to the other when due to the other party will
bear
interest from the expiration of any applicable grace or cure periods until
the
date of payment at the lesser of (i) the prime commercial rate (“Prime Rate”)
being charged by Citibank N.A. in effect on the date due plus two percent (2%)
per annum (“Default Rate”); or (ii) the maximum rate permitted by law. If
Citibank N.A. is no longer in existence, then another comparable bank or
financial institution shall be substituted by Landlord.
24
| 14.6 |
Default
by Landlord
|
Landlord
shall be in default if Landlord fails to perform any provision of this Lease
required of it and the failure is not cured within thirty (30) days after notice
has been given to Landlord. If, however, the failure cannot reasonably be cured
within the cure period, Landlord shall not be in default of this Lease if
Landlord commences to cure the failure within the cure period and diligently
and
in good faith continues to cure the failure. Notices given under this Section,
and Sections 14.1.1 and 14.1.2 shall specify the alleged breach and the
applicable Lease provisions. If Landlord shall at any time default beyond the
applicable notice and cure period, Tenant shall have the right to cure such
default on Landlord’s behalf Any sums expended by Tenant in doing so, and all
reasonably necessary incidental costs and expenses incurred in connection
therewith, shall be payable by Landlord to Tenant within ten (10) days following
demand therefor by Tenant, provided, however, that Tenant shall not be entitled
to any deduction or offset against any rent otherwise payable to Landlord under
this Lease.
15.
RIGHT OF INSPECTION
Landlord
and Landlord’s authorized representatives shall have the right upon giving at
least two (2) business days’ advance written notice (except in the event of
emergency, in which Landlord shall give such notice as is practicable under
the
circumstances) and subject to Tenant’s occupational health and safety policies
and other reasonable requirements of Tenant made known in advance to Landlord,
to enter upon the Premises at all reasonable hours for the purpose of inspecting
the Premises or of making repairs, additions or alterations in or upon
the
Premises
(following Tenant’s failure to cure any breach of such obligations), and for the
purpose of exhibiting the Premises to prospective tenants, purchasers or others.
Landlord shall not exhibit any “for sale” or “for rent” signs during the term of
the Lease. Landlord shall use commercially reasonable efforts not to
unreasonably interfere with Tenant’s use or occupancy of the
Premises.
16.
WAIVER OF BREACH
No
waiver
by Landlord or Tenant of any breach of any one or more of the terms, covenants,
conditions, or agreements of this Lease shall be deemed to imply or constitute
a
waiver of any succeeding or other breach. Failure of Landlord or Tenant to
insist upon the strict performance of any of the terms, conditions, covenants,
and agreements of this Lease shall not constitute or be considered as a waiver
or relinquishment of such party’s rights to subsequently enforce any default,
term, condition, covenant, or agreement, which shall all continue in full force
and effect. The rights and remedies of Landlord and Tenant under this Lease
shall be cumulative and in addition to any and all other rights and remedies
which such party has or may have.
17.
NOTICES
| 17.1 |
Notice
Requirements
|
All
notices, requests, or demands herein provided to be given or made, or that
may
be given or made by either party to the other, shall be given or made only
in
writing and shall be deemed to have been duly given: (i) when delivered
personally at the address set forth below, or to any agent of the party to
whom
notice is being given, or if delivery is rejected when delivery was attempted;
or (ii) on the date delivered when sent via overnight courier, properly
addressed and postage prepaid; or (iii) on the date sent via facsimile
transmission (with written evidence thereof). The proper address to which
notices, requests, or demands may be given or made by either party shall be
the
address set forth at the end of this Section or to such other address or to
such
other person as any party shall designate. Such address may be changed by
written notice given to the other party in accordance with this
Section.
25
|
If
to Landlord:
|
||
|
YA
Landholdings, LLC
|
||
|
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
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||
|
▇▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
|
||
|
Attn:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
|
||
|
E-mail:
▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
|
||
|
with
a copy to:
|
▇▇▇▇▇
▇▇▇▇▇ L.L.P.
|
|
|
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
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|
▇▇▇
▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
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Attention:
▇▇▇▇▇ ▇▇▇▇▇▇
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|
E-mail:
▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
|
||
|
If
to Tenant:
|
||
|
Appalachian
Oil Company, Inc.
|
||
|
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇
|
||
|
▇▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
|
||
|
Attn:
▇▇▇▇▇ Chance
|
||
|
E-mail:
▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
|
||
|
with
a copy to:
|
▇▇▇▇▇▇
▇. ▇▇▇▇
|
|
|
▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP
|
||
|
▇▇
▇▇▇▇▇▇▇▇
|
||
|
▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
|
||
|
E-mail:
▇▇▇▇▇@▇▇▇▇.▇▇▇
|
| 17.2 |
Payments
Under Lease
|
Rent
and
all other payments due to Landlord under this Lease shall be paid in lawful
money of the United States of America without offset or deduction to the name
and at the address first given above or to such other persons or parties or
at
such other places as Landlord may from time to time designate in
writing.
26
18.
RELATIONSHIP OF THE PARTIES
This
Lease shall not be deemed or construed by the parties, nor by any third party,
as creating the relationship of (i) principal and agent, (ii) partnership,
or
(iii) joint venture between the parties. Neither the method of computation
of
rent nor any other provision of this Lease, nor any acts of the parties are
other than in the relationship of Landlord and Tenant.
19.
SUBORDINATION,
ATTORNMENT AND ESTOPPEL
| 19.1 |
Subordination
and Non-Disturbance
|
Subject
to the provisions of this Section, this Lease and the leasehold estate created
hereby shall be, at the option and upon written declaration of Landlord,
subject, subordinate, and inferior to the lien and estate of any liens, trust
deeds, and encumbrances (“Mortgages”),
and
all
renewals, extensions, or replacements thereof, now or hereafter imposed by
Landlord upon the Premises; provided, however, that this Lease shall not be
subordinate to any Mortgage arising on or after the date of this Lease, or
any
renewal, extension, or replacement thereof, unless and until Landlord provides
Tenant with an agreement (“Non-Disturbance
Agreement”), signed
and acknowledged by each holder of any such interest setting forth that so
long
as there is no continuing Event of Default hereunder, Landlord’s and Tenant’s
rights and obligations hereunder shall remain in force and Tenant’s right to
possession shall be upheld and shall not be disturbed. The Non-Disturbance
Agreement shall be substantially in the form attached hereto and incorporated
herein as Exhibit
D.
| 19.2 |
Attornment
|
In
the
event of foreclosure of any Mortgage, whether superior or subordinate
to
this
Lease, then (i) this Lease shall continue in force; (ii) Tenant’s quiet
possession shall not be disturbed by reason of such foreclosure; (iii) Tenant
shall attorn to and recognize the mortgagee or purchaser at foreclosure sale
(“Successor
Landlord”) as
Tenant’s landlord for the remaining term of this Lease; and (iv) the Successor
Landlord shall not be bound by any liability for any act or omission of a prior
landlord.
| 19.3 |
Tenant
Estoppel Certificate
|
Tenant
shall execute and deliver to Landlord, within fifteen (15) days after receipt
of
Landlord’s request, any estoppel certificate or other statement to be furnished
to Landlord or any prospective purchaser of or any lender against the Premises
which shall include only the matters hereinafter set forth. Such estoppel
certificate shall acknowledge and certify each of the following matters, to
the
extent each may be true: that the Lease is in effect and not subject to any
rental offsets, claims, or defenses to its enforcement; the commencement and
expiration dates of the term; that Tenant is paying rent on a current basis;
that any improvements required to be furnished by Landlord under the Lease
have
been completed in all respects; that the Lease constitutes the entire agreement
between Tenant and Landlord relating to the Premises; that Tenant has accepted
the Premises and is in possession thereof, that the Lease has not been modified,
altered, or amended except in specified respects by specified instruments;
and
such other matters as reasonably may be requested that do not alter or amend
the
terms of the Lease.
27
| 19.4 |
Landlord
Estoppel Certificate
|
Landlord
shall execute and deliver to Tenant, within fifteen (15) days after receipt
of
Tenant’s request, any estoppel certificate or other statement to be furnished to
Tenant or any prospective assignee, subtenant, purchaser or any lender against
Tenant’s interest in any Premises which shall include only the matters
hereinafter set forth. Such estoppel certificate shall acknowledge and certify
each of the following matters, to the extent each may be true: that the Lease
is
in effect and not subject to any rental offsets, claims, or defenses to its
enforcement; the commencement and expiration dates of the term; that Tenant
is
paying rent on a current basis; that any improvements required to be furnished
by Tenant under the Lease have been completed in all respects; that the Lease
constitutes the entire agreement between Landlord and Tenant relating to the
Premises; that the Lease has not been modified, altered, or amended except
in
specified respects by specified instruments; and such other matters as
reasonably may be requested that do not alter or amend the terms of the
Lease.
| 19.5 |
Leasehold
Mortgage
|
Tenant
is
hereby given the right by Landlord to mortgage its interest in this Lease under
one or more leasehold mortgages without obtaining the consent of Landlord upon
the condition that all rights acquired under such mortgages shall be subject
to
each and all of the terms, covenants, conditions and restrictions set forth
in
this Lease, and to all rights and interests of Landlord herein, none of which
terms, covenants, conditions or restrictions is or shall be waived by Landlord
by reason of the right given so to mortgage such interest in this Lease, except
as expressly provided herein. If Tenant shall mortgage this leasehold, and
if
Tenant or the holder of such mortgage shall, within thirty (30) days of
execution send to Landlord a true copy thereof together with written notice
specifying the name and address of the mortgagee and the pertinent recording
date with respect to such mortgage, Landlord agrees that so long as any such
leasehold mortgage shall remain unsatisfied of record or until written notice
of
satisfaction is given by the holder to Landlord, the following provisions shall
apply:
|
19.5.1
|
There
shall be no cancellation, surrender or material modification of this
Lease
by joint action of Landlord and Tenant (as opposed to termination
as a
result of Tenant’s default) without the prior consent in writing of the
leasehold mortgagee (which consent shall not be unreasonably withheld,
conditioned or delayed); provided however, under no circumstances
shall
failure to obtain such prior written consent constitute a breach
of, or
default under, the Lease by Landlord, nor shall Tenant or the leasehold
mortgagee have any recourse whatsoever against Landlord for such
failure
to obtain prior written consent; and further provided that this subsection
shall not impair Landlord’s right to unilaterally terminate the Lease in
the event of an uncured Event of Default by Tenant under the
Lease.
|
28
|
19.5.2
|
Landlord
shall, upon serving Tenant with any notice of default, simultaneously
mail
a copy of such notice to the holder of such mortgage; provided however,
under no circumstances shall Landlord’s failure to mail such notice
constitute a breach of, or default under, the Lease, nor shall Tenant
or
the leasehold mortgagee have any recourse whatsoever against Landlord
for
such failure to give notice; provided however that the remedy period
available to such leasehold mortgagee shall not begin to run until
the
leasehold mortgagee has received such notice. The leasehold mortgagee
shall thereupon have the same period to remedy or cause to be remedied
the
defaults complained of, and Landlord shall accept such performance
by or
at the instigation of such leasehold mortgagee as if the same had
been
done by Tenant.
|
|
19.5.3
|
Anything
herein contained notwithstanding, if any default shall occur which,
pursuant to any provision of this Lease, entitles Landlord to terminate
this Lease, and if before the expiration of ten (10) days from the
date of
service of notice of termination upon such leasehold mortgagee, such
leasehold mortgagee shall have notified Landlord of its desire to
nullify
such notice and shall have paid to Landlord all rent and other payments
herein provided for, and then in default, and shall have complied
with all
of the other requirements of this Lease or, if immediate compliance
is
impossible, shall have commenced the work of complying with all of
the
other requirements of this Lease, if any are then in default, and
shall
prosecute the same to completion with reasonable diligence, then
in such
event Landlord shall not be entitled to terminate this Lease and
any
notice of termination theretofore given shall be void and of no
effect.
|
|
19.5.4
|
The
proceeds from any insurance policies or arising from a condemnation
are to
be distributed pursuant to the provisions of this Lease, but the
leasehold
mortgagee may reserve rights to apply to the mortgage debt all, or
any
part, of Tenant’s share of such proceeds pursuant to such
mortgage.
|
|
19.5.5
|
Landlord
shall not unreasonably withhold its consent to any assignment of
the Lease
or to any transfer of title to or by the leasehold mortgagee, its
successors or assigns, or subletting thereunder by the leasehold
mortgagee, its successors and assigns, provided such assignment or
subleasing are made as a part of the leasehold mortgagee’s remedies under
the leasehold mortgage. Landlord’s consent under this subsection shall be
based upon Landlord’s customary review and evaluation process of
prospective new tenants.
|
|
19.5.6
|
Any
and all leasehold mortgage(s) shall at all times be subject, subordinate,
and inferior to the lien and estate of any liens, trust deeds, mortgages
or encumbrances, and all renewals, extensions or replacements thereof,
now
or hereafter imposed by Landlord upon the
Premises.
|
29
20.
ATTORNEYS’ FEES
| 20.1 |
Recovery
of Attorneys’ Fees and Costs of
Suit
|
If
any
action for breach of or to enforce the provisions of this Lease is
commenced,
the court in such action shall award to the party in whose favor a judgment
is
entered, a reasonable sum as attorneys’ fees and costs. Such attorneys’ fees and
costs shall be paid by the losing party in such action.
| 20.2 |
Party
to Litigation
|
Tenant
shall indemnify Landlord against and hold Landlord harmless from all costs,
expenses, demands, and liability incurred by Landlord if Landlord involuntarily
becomes
or
is
made a party to any claim or action (i) instituted by any third party against
Tenant, or by or against any person holding any interest under, or using the
Premises by license of or agreement with Tenant; (ii) for foreclosure of any
lien for labor or material furnished to or for Tenant or such other person;
or
(iii) otherwise arising out of or resulting from any action or transaction
of
Tenant. Tenant shall defend Landlord against any such claim or action at
Tenant’s expense with counsel reasonably acceptable to Landlord.
21.
AUTHORITY TO MAKE LEASE; COVENANT OF QUIET ENJOYMENT
| 21.1 |
Full
Power and Authority to Enter Lease
|
The
parties covenant and warrant that each has full power and authority to enter
into this Lease.
| 21.2 |
Quiet
Enjoyment
|
Landlord
covenants and warrants that Tenant shall have and enjoy full, quiet, and
peaceful possession of the Premises, the appurtenances and all rights and
privileges incidental thereto during the term, as against all persons claiming
by, through, or under Landlord, subject to the provisions of this Lease and
any
title exceptions or defects in existence on the Commencement Date.
22.
HAZARDOUS MATERIAL
| 22.1 |
Compliance
Generally
|
Tenant
shall comply with all Environmental Laws that are applicable to the Premises,
including the Storage Tank System, and Tenant’s occupancy and operation thereof
Tenant shall not use, store, transport, dispense or sell Hazardous Materials
at
the Premises, except as reasonably necessary or appropriate in connection with
the permitted use of the Premises. Tenant shall not Release, nor shall Tenant
permit any employee, contractor or agent, and Tenant shall use commercially
reasonable efforts not to permit any invitee, to Release any Hazardous Materials
onto, into or from the Premises or any surrounding land, surface water or ground
water except as and to the extent allowed by applicable law, including
Environmental Laws.
30
| 22.2 |
Tenant’s
Responsibility for Hazardous
Materials
|
Tenant
shall be liable for and responsible for Hazardous Materials kept, stored or
otherwise managed or Released on or from the Premises prior to the expiration
of
the Term of the Lease, including without limitation, at Tenant’s sole cost, any
(i) permitting, reporting, assessment, testing, investigation, storage,
treatment, removal, remediation, transportation and disposal of such Hazardous
Materials as directed by any governmental agency and as otherwise required
by
Environmental Laws; (ii) damages, costs, expenditures and claims imposed or
brought under Environmental Laws for injury to persons, property, the Premises
and surrounding air, land, surface water, and ground water resulting from such
Hazardous Materials; (iii) claims by any governmental agency or third party
associated with injury to surrounding air, land, surface water and ground water
or other damage resulting from such Hazardous Materials; (iv) damages for injury
to the buildings, fixtures, appurtenances, equipment and other personal property
of Landlord to the extent caused by such Hazardous Materials; (v) fines,
penalties, costs, fees, assessments, demands, orders, liens, directives or
any
other requirements imposed in any manner by any governmental agency or under
any
Environmental Laws with respect to such Hazardous Materials; (vi) damages,
costs
and expenditures for injury to natural resources to the extent caused by such
Hazardous Materials; (vii) compliance with Environmental Laws regarding the
use,
storage, transportation, release, disposal, dispensing or sale of Hazardous
Materials; and (viii) any other liability or obligation under Environmental
Laws
related to such Hazardous Materials. While Landlord is not required to incur
any
costs, fees (including attorney, consultant and expert witness fees) or expenses
for environmental compliance, testing, investigation, assessment, remediation
or
cleanup relating to such Hazardous Materials under this Lease, should Landlord
reasonably incur any such costs, expenses or fees relating to such Hazardous
Materials at the Premises or surrounding lands or surface water or ground water
in order to comply with Environmental Law with respect to which Tenant is liable
pursuant to this Section, Tenant shall promptly reimburse Landlord for said
costs, expenses or fees.
| 22.3 |
Tenant’s
Environmental Indemnification
|
Tenant
shall indemnify, defend, and hold Landlord Indemnified Parties harmless from
any
and all claims, judgments, damages, penalties, fines, costs, liabilities, or
losses (including, without limitation, claims
based on the strict liability of Landlord and damages
for the loss or restriction on use of rentable or usable space or of any amenity
of the Premises, damages arising from any adverse impact on marketing of space
of the Premises, and sums paid in settlement of claims, attorneys’ fees,
consultation fees, and expert fees) which arise as a result of (i) the keeping,
storage or other management of or a Release of Hazardous Materials on or from
the Premises prior to the expiration of the Term of the Lease or (ii) any
violation of Environmental Laws prior to the expiration of the Term of the
Lease
with respect to the Premises. This indemnification of Landlord Indemnified
Parties by Tenant relating to such Releases includes, without limitation, costs
incurred in connection with any investigation of on-site or off-site conditions
or any monitoring,
response,
cleanup, remedial, removal, closure or restoration work required by any federal,
state, or local governmental agency or political subdivision and any mechanics
or materialmen liens placed upon the Premises or any other property of Landlord
as a result of the occurrence of (i), (ii) and/or (iii) above.
31
| 22.4 |
Tenant’s
Notification Obligations
|
Tenant
immediately shall notify Landlord of any of the following: (i) any
correspondence or communication from any governmental entity regarding the
application of Environmental Laws to the Premises or Tenant’s operation of the
Premises which would reasonably be expected to result in the imposition of
material costs or liability on Tenant; (ii) any correspondence, communication
or
notifications as are required by either the Federal or State Emergency Planning
and Community Right to Know Acts which would reasonably be expected to result
in
the imposition of material costs or liability on Tenant; (iii) any change in
Tenant’s operations on the Premises that will change or would be reasonably
expected to change Tenant’s obligations or liabilities under Environmental Laws
with respect to the Premises in any material respect; (iv) any material Releases
or suspected material Releases or
the
discovery of an historical material Release of
any
and all Hazardous Materials at, from or near the Premises, or confirmation
of a
Release from a Storage Tank System, which would reasonably be expected to result
in the imposition of material costs on Tenant or
a
material contamination of the Premises.
| 22.5 |
Survival
|
Provisions
of this Section 22
shall
survive expiration or termination of the
tenancy.
23.
GENERAL
PROVISIONS
| 23.1 |
Recitals
|
The
Recitals set forth above are hereby incorporated by this reference.
| 23.2 |
Gender;
Number
|
The
use
of (i) the neuter gender includes the masculine and feminine and (ii) the
singular number includes the plural, whenever the context requires.
| 23.3 |
Captions
|
Captions
in this Lease are inserted for the convenience of reference only and do not
define, describe, or limit the scope or the intent of this Lease or any of
its
terms.
32
| 23.4 |
Exhibits
|
All
attached exhibits are a part of this Lease and are incorporated in full by
this
reference. Except as specifically provided herein, if any provision contained
in
any exhibit hereto is inconsistent or in conflict with any provisions of this
Lease, the provisions of this Lease shall supersede the provisions of such
exhibit and shall be paramount and controlling.
| 23.5 |
Entire
Agreement
|
This
Lease contains the entire agreement between the parties relating to the
transactions contemplated hereby and all prior or contemporaneous agreements,
understandings, representations and statements, oral or written, are merged
into
this Lease.
| 23.6 |
Drafting
|
This
Lease shall not be construed more strictly against one party than the other
because it may have been drafted by one of the parties or its counsel, each
having contributed substantially and materially to the negotiation and drafting
hereof.
| 23.7 |
Modification
|
No
modification, waiver, amendment, discharge, or change of this Lease shall be
valid unless it is in writing and signed by the party against which the
enforcement of the modification, waiver, amendment, discharge, or change is
or
may be sought.
| 23.8 |
Joint
and Several Liability
|
If
any
party consists of more than one person or entity, the liability of each such
person or entity signing this Lease shall be joint and several; provided that
the foregoing shall not be deemed to create any personal liability on the part
of any person signing this Lease either individually or on behalf of any
entity.
| 23.9 |
Enforceability
|
The
parties warrant and represent that the terms of this Lease are fully enforceable
in the localities in which the Premises are located; subject however to
limitations as may be relevant based on applicable bankruptcy, insolvency and
creditors’ rights laws. It is the intention of the parties that if any provision
of this Lease is inconsistent or in conflict with local law, custom,
or practice, the provisions of this Lease shall supersede and shall be paramount
and controlling.
| 23.10 |
Severability
|
In
the
event any term, covenant, condition, or provision of this Lease is held to
be
invalid, void, or otherwise unenforceable by any court of competent
jurisdiction, the fact that such term, covenant, condition, or provision is
invalid, void, or otherwise unenforceable shall in no way affect the validity
or
enforceability of any other term, covenant, condition, or provision of this
Lease.
33
| 23.11 |
Successors
and Assigns
|
Except
as
otherwise provided herein, all terms of this Lease shall be binding upon, inure
to the benefit of, and be enforceable by the parties and their respective legal
representatives, successors, and assigns.
| 23.12 |
Independent
Covenants
|
This
Lease shall be construed as though the covenants herein between Landlord and
Tenant are independent and not dependent.
| 23.13 |
Limitation
on Landlord’s Liability
|
Notwithstanding
anything contained in this Lease to the contrary, Landlord shall not incur
any
liability beyond Landlord’s interest in the Premises upon a breach of this
Lease, and Tenant shall look exclusively to such interest in the Premises and
the proceeds of any sale or refinancing, insurance proceeds and condemnation
awards for the payment and discharge of any obligations imposed upon Landlord
under this Lease.
| 23.14 |
Waiver
of Trial by Jury
|
Landlord
and Tenant do hereby waive trial by jury in any action, proceeding or
counterclaim brought by either party against the other, upon any matters
whatsoever arising out of or in any way connected with this Lease, Tenant’s use
or occupancy of the Premises and/or any claim of injury or damage. It further
is
agreed that in the event Landlord commences any summary proceeding for
non-payment of rent or additional rent, Tenant will not interpose any
counterclaim (except for compulsory counterclaims) of whatever nature or
description in any such proceeding.
| 23.15 |
Characterization
of Lease
|
|
23.15.1
|
Landlord
and Tenant intend that this Lease is a “true lease” and not a financing
lease, capital lease, mortgage, equitable mortgage, deed of trust,
trust
agreement, security agreement or other financing or trust arrangement,
and
the economic realities of this Lease are those of a true lease;
and
|
|
23.15.2
|
the
business relationship created by this Lease and any related documents
is
solely that of a long-term commercial lease between landlord and
tenant
and has been entered into by both parties in reliance upon the economic
and legal bargains contained
herein.
|
34
| 23.16 |
Counterparts
|
This
Lease may be executed in any number of counterparts, each of which shall be
deemed an original. The counterparts shall together constitute but one
agreement. Any signature on a copy of this Lease or any document necessary
or
convenient thereto sent by facsimile shall be binding upon transmission by
facsimile and the facsimile copy may be utilized for the purposes of this
Lease.
| 23.17 |
Force
Majeure
|
Any
prevention, delay or stoppage due to strikes, lockouts, acts of God, enemy
or
hostile governmental action, civil commotion, fire or other casualty beyond
the
control of the party obligated to perform shall excuse the performance by such
party for a period equal to any such prevention, delay or stoppage.
| 23.18 |
Confidentiality.
|
Landlord
hereby agrees and covenants in favor of Tenant to keep confidential all
proprietary or confidential information made available to Landlord in connection
herewith in respect of Tenant, Guarantor or the Premises, including, without
limitation, all non-publicly available financial information of Tenant, and
all
non-publicly available terms of this Lease (collectively, “Confidential
Information”), and
not
to disclose any Confidential Information in any manner whatsoever to any person,
without the prior written consent of Tenant, except: (i) to Landlord’s
directors, officers, employees, attorneys, accountants, auditors and others
providing professional services on a “need to know basis” or (ii) to any
bonafide
investor,
purchaser or lender of Landlord or the Premises that is not a competitor of
Tenant and that has agreed in writing in favor of Tenant to keep confidential
all such Confidential Information and not to disclose any such Confidential
Information in any manner whatsoever to any person except in accordance with
this Section. The obligations arising pursuant to this Section shall survive
the
expiration or earlier termination of this Lease.
35
|
TENANT:
|
||
|
YA
Landholdings, LLC
|
Appalachian
Oil Company, Inc.
|
|
|
By:
|
New EarthShell Corporation, | |
|
|
its
sole equity member
|
|
|
By:
|
By:
|
||||
|
Name:
|
|||||
|
Title:
|
Title:
|
36
EXHIBIT
“A”
LEASED
PREMISES
(LEGAL
DESCRIPTION)
1
EXHIBIT
“B”
MEMORANDUM
OF LEASE
This
Memorandum of Lease is made and entered into as of __________ by
and
between _____________,
a
_________ limited liability company (“Landlord”) and Appalacian
Oil Company, Inc.,
a
__________ corporation (“Tenant”) who agree as follows:
1. Terms
and
Premises. Pursuant to a certain Land and Building Lease Agreement (the “Lease”)
dated __________________,
entered
into between Landlord and Tenant Landlord leases to Tenant and Tenant leases
from Landlord that certain real property, together with all the improvements
thereon and appurtenances thereunto belonging (the “Premises”), which legal
description is attached hereto and incorporated herein as Exhibit “A,” commonly
known as:
APPCO
STORE NO. ___
[INSERT
ADDRESS]
for
a
term commencing on ___________ and expiring on ____________________ Tenant
has
FOUR (4) five-year options to extend the term of the Lease, all as more
particularly set forth in the Lease.
2. Tenant
has the right to mortgage its interests in the Lease without obtaining the
consent of Landlord upon the condition that all rights acquired under such
mortgages shall be subject to each and all of the terms, covenants, conditions
and restrictions set forth in the Lease and to all rights and interests of
Landlord therein, all as more particularly set forth in the Lease.
3. Tenant
has a right of first offer on any sale, lease assignment conveyance or other
transfer of all or part of the Premises by Landlord to any third person, all
as
more particularly set forth in the Lease.
4.
This
Memorandum of Lease is prepared for the purpose of recordation and does not
modify the provisions of the Lease. The Lease is incorporated herein by
reference. If there are any conflicts between the Lease and this Memorandum
of
Lease, the provisions of the Lease shall prevail.
5.
By
execution of this Memorandum, Tenant hereby terminates any existing Memoranda
of
Lease which are filed of record against the Premises and which identify Tenant
as the tenant under a lease of the Premises.
1
|
LANDLORD:
|
TENANT:
|
|||
| ____________________ |
Appalachian
Oil Company, Inc.
|
|||
|
By:
|
By:
|
|||
|
Date:
|
Date:
|
|||
|
Signed,
sealed, and delivered this ___________ day of ____________ 2007 in
the presence of:
|
Signed,
sealed, and delivered this ___________ day of ___________ 2007
in the presence of:
|
|||
|
Witness
|
Witness
|
|||
|
Witness
|
Witness
|
|||
|
STATE
OF _______________________
|
||||
|
§
|
||||
|
COUNTY
OF ____________________________ §
|
||||
On
this
____
day
of ,
2007,
before me, the undersigned notary public in and for said County and State,
personally appeared before me _______________________________ to me personally
known, who, being by me duly sworn, did say that he is a _______________________
of _______________ and
that
said instrument was signed on behalf of said _________________, and he
acknowledged said instrument to be the free act and deed of
said
2
WITNESS
BY HAND and
notarial seal subscribed and affixed in said County and State the _______day
of________ ,2007.
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NOTARY
PUBLIC IN AND FOR THE STATE OF:
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MY
Commission EXPIRES:___________________
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RESIDING
AT: ____________________________
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STATE OF
_________________________________
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COUNTY OF________________________________
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On
this
____day of ,
2007,
before me, the undersigned notary public in and for said County and State,
personally appeared before me __________________________, to me personally
known, who, being by me duly sworn, did say that he is a _______________________
of_______________________,
and
that
said instrument was signed on
behalf
of
said __________________,,
and
he
acknowledged said instrument to be the free act and deed of
said
3
Exhibit
A to Exhibit B
Legal
Description
1
EXHIBIT
“C”
CERTIFICATE
OF LIABILITY INSURANCE AND
EVIDENCE
OF PROPERTY INSURANCE
See
attached.
1
EXHIBIT
“D”
SUBORDINATION,
NON-DISTURBANCE AND ATTORNMENT AGREEMENT
See
attached.
1
When
recorded, return to:
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇ LLP
▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇
SUBORDINATION,
NON-DISTURBANCE AND ATTORNMENT AGREEMENT
THIS
SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT is made and entered
into
by and among YA Landholdings, LLC, ,
whose
mailing address is ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (“Landlord”),
YA Global Investments, L.P. ,
whose
mailing address is ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (“Lender”)
and Appalachian
Oil Company, Inc.,
a
Tennessee corporation, whose mailing address is ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇▇▇,
▇▇
▇▇▇▇▇, Attn: ▇▇▇▇▇ Chance (“Tenant”).
RECITALS:
A. Landlord
and
Tenant are
parties to a lease dated ___________ (the “Lease”), for the real property
described on the attached Exhibit A (the “Premises”); and
B. Lender
has agreed to make a loan to Landlord, which loan is to be secured by a realty
mortgage, deed of trust or other security instrument (the “Mortgage”)
encumbering the Premises; and
C. Lender
and Tenant desire to provide for, among other matters, the subordination of
the
lien of Tenant’s leasehold interest in the Premises to the lien of the Mortgage
and the non-disturbance of Tenant’s enjoyment, use and occupancy of the
Premises;
NOW,
THEREFORE, in consideration of the mutual covenants and representations
hereinafter contained, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereby
agree as follows:
1. SUBORDINATION.
Subject
to the other provisions hereof, the lien of Tenant’s leasehold interest and
estate in the Premises created by the Lease shall be at all times hereafter
subject to and subordinate in priority to the lien of the Mortgage and to all
renewals, modifications, replacements and extensions thereof. The lien of the
Mortgage shall not, however, encumber any of Tenant’s personal property located
at the Premises as identified on Schedule 1 attached hereto and all products
and
proceeds of same.
2. NON-DISTURBANCE
AND RECOGNITION.
Notwithstanding any provision in the Mortgage to the contrary, Lender agrees
that in the event of a foreclosure of the Mortgage or other similar proceeding
against Landlord that so long as Tenant continues to pay rent and otherwise
comply with the terms and conditions of the Lease within applicable grace
periods, then the Lease and
the
Leasehold Mortgage or Leasehold Deed of Trust in favor of Greystone Business
Credit II, LLC (if it is, by its terms, in effect) shall
remain in full force and effect and Tenant’s right to possession of the Premises
will not be disturbed during the original term of the Lease or any renewal
or
extension thereof Should Tenant be named as a defendant in any such proceeding,
Landlord shall indemnify Tenant with respect to any liability, claim or expense
which Tenant may incur with respect to any such
proceedings.
1
3. ATTORNMENT
BY TENANT.
In the
event that Lender or any other purchaser at a foreclosure or public or private
sale (or by agreement in lieu thereof), or any successor-in-title to any of
them
(“New Owner”) acquires title to the Premises, Tenant shall attorn to such New
Owner and the Lease shall continue in full force and effect as a direct lease
between Tenant and such New Owner upon all of the terms and conditions contained
therein.
4. MISCELLANEOUS
4.1 Primacy
of Agreement.
In the
event of any conflict or ambiguity between the provisions of this Agreement
and
those of the Mortgage, this Agreement shall be controlling in all respects.
No
provision herein shall be deemed an amendment or modification of any provision
of the Lease.
4.2 Notices.
Any
notice required or permitted to be given herein shall be in writing and shall
be
delivered by hand, mailed by first class mail, postage prepaid, telecopied
or
sent by overnight courier to the addresses set forth at the beginning of this
Agreement. Any such notice shall be deemed to be received: (a) if delivered
personally, on the date of such delivery; (b) if mailed, on the third business
day following mailing; (c) if telecopied, on the date of transmission; or (d)
if
sent by overnight courier, on the first business day following delivery to
courier.
4.3 Attorney’s
Fees.
In the
event any party employs legal counsel to enforce or ▇▇▇ for a breach or
anticipated breach of any provision of this Agreement, the prevailing party
shall be entitled to recover all fees, charges, costs and expenses (including,
without limitation, reasonable attorneys’ fees and disbursements) incurred in
connection therewith.
4.4 Authority.
Landlord, Tenant and Lender each represent and warrant that they have full
power, right and legal capacity, and have received all necessary authorizations
to execute this Agreement and to perform fully hereunder.
4.5 Entire
Agreement Amendments.
This
Agreement constitutes the entire agreement between the parties with respect
to
the subject matter hereof, all prior or contemporaneous promises and
understandings related thereto having been superseded hereby. No provision
of
this Agreement may be amended, canceled, deleted or supplemented except by
a
writing signed by all of the parties.
4.6
Construction.
If any
party consists of more than one person, then their obligations hereunder shall
be joint and several. This Agreement is a negotiated document, and the parties
have had the opportunity to have it reviewed by counsel. It reflects the
“reasonable expectations” of the parties and as such, it shall be construed
according to its fair meaning and without
application of any drafting rule or presumption.
2
4.7 Governing
Law - Successors and Assigns.
This
Agreement and the rights and obligations of the parties hereunder shall be
governed by, and construed and interpreted in accordance with, the laws of
the
State where the Premises are located, shall run with the Premises and shall
be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
4.8 Counterparts.
This
Agreement may be executed in counterparts, and any counterpart containing
original signature pages of all parties shall constitute an original Agreement
for all purposes.
4.9 Recordation.
Lender
may, at its sole cost and expense, record this Agreement in the Official Records
of the county in which the Premises is located and
shall
thereupon deliver a copy of such recorded Agreement to Tenant at the above
address.
5. CONSENT.
Lender
hereby acknowledges and consents to that certain Landlord's Waiver and Consent
to Leasehold Mortgage Or Deed of Trust dated _____, 2007 among Landlord, Tenant
and Greystone Business Credit II, LLC.
IN
WITNESS WHEREOF, the parties have executed this Agreement.
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TENANT:
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Appalachian
Oil Company, Inc.
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By:
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Name:
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Title:
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Date:
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3
STATE
OF
________________
COUNTY
OF
_______________
The
foregoing instrument was acknowledged before me this _____ day of September,
2007 by _______________ as ________________of
Appalachian Oil Company, Inc.,
a
Tennessee corporation, on behalf of the corporation. He is personally known
to
me or has produced ________________________ as identification.
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Signature
of person taking acknowledgment
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Name
typed, printed or stamped
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Commission
Expiration
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4
LANDLORD:
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YA
LANDHOLDINGS, LLC,
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a
Delaware limited liability company
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By:
New EarthShell Corporation, a Delaware
corporation,
its sole member
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By:
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Name:
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Title:
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STATE
OF
________________
COUNTY
OF
_______________
The
foregoing instrument was acknowledged before me this _____ day of September,
2007 by _______________ as ________________of
New
EarthShell Corporation, a Delaware corporation, on behalf of the YA
Landholdings, LLC, a Delaware limited liability company.. He is personally
known
to me or has produced ________________________ as
identification.
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Signature
of person taking acknowledgment
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Name
typed, printed or stamped
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Commission
Expiration
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5
LENDER:
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YA
Global Investments, L.P.
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By:
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Yorkville
Advisors LLC,
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a
Delaware limited liability company,
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its
Investment Manager
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By:
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Name:
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Title:
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STATE
OF
________________
COUNTY
OF
_______________
The
foregoing instrument was acknowledged before me this _____ day of September,
2007 by _______________ as ________________of
Yorkville Advisors LLC, a Delaware limited liability company, as Investment
Manager for YA Global Investments, L.P. He is personally known to me or has
produced ________________________ as identification.
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Signature
of person taking acknowledgment
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Name
typed, printed or stamped
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Commission
Expiration
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6
EXHIBIT
“A”
LEGAL
DESCRIPTION
1
SCHEDULE
1
TENANT'S
PERSONAL PROPERTY
Food
service equipment, food preparation equipment, grills, fryers, security
systems, security cameras, refrigerators, freezers, ice machines, point of
sale computer equipment and inventory management systems, computers, cash
registers, above and below ground fuel tanks and associated piping, fuel pumps,
vapor recovery systems, water treatment equipment, water softening equipment,
signs, canopies, cabinets, display cases, display racks, shelving, safes,
atm machines, credit card machines, drink dispensers, drink makers, tire
inflators, compressors, printers, tables, desks, chairs, sound systems, menu
boards, time clocks, dumpsters, washers, dryers, ice merchandisers, filing
cabinets, lawnmowers, trash cans, benches, video games, vending machines and
ice
chests.
1