EXHIBIT 6.6CE
GROUND LEASE AGREEMENT
THIS GROUND LEASE AGREEMENT (the "Lease"), is made as of the 11th day
of April, 1997 (the "Lease date"), by and between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ DEVELOPMENT,
LTD., a Texas limited partnership, whose address is ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ("Lessor"), and FRESH N' LITE, INC., a Texas
corporation, whose address is ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
("Lessee").
In consideration of the covenants contained in this Lease, the parties
agree as follows:
I.
PROPERTY LEASED
1.1 DEMISE. Lessor leases to Lessee and Lessee leases from Lessor the following
property (the "Land") located in Shopping Center (hereinafter defined) together
with certain non-exclusive easements of ingress and egress and parking described
herein (collectively herein called the "premises" or the "leased premises").
Legal Description of Land: See Exhibit "A" attached hereto and made a
part hereof.
Commonly described as: Fresh'n Lite Cafe and Grill
The Colony, Texas
Legal Description of Shopping Center:
Lessor's property located in the City of The Colony, ▇▇▇▇▇▇ County,
Texas, which property is described or shown on Exhibit "A-1" attached
to this Lease. With regard to Exhibit "A-1", the parties agree that the
exhibit is attached solely for the purpose of locating the Shopping
Center and the premises within the Shopping Center and that no
representation, warranty, or covenant is to be implied by any other
information shown on the exhibit (i.e., any information as to
buildings, tenants or prospective tenants), etc. is subject to change
at any time. Notwithstanding the foregoing, Lessor will not construct,
or allow any other party to construct, other buildings or improvements
in the "No Build Area" shown on Exhibit "A-1" of this Lease without
Lessee's approval, which approval shall not be unreasonably withheld.
The lease of the leased premises is subject to the easements,
conditions and restrictions of record affecting the Shopping Center and
the ingress/egress and parking easements set out in Exhibit "B" of this
Lease, including without limitation that certain Declaration of
Restrictions and Grant of Easements (the "Declaration").
With respect to the Declaration:
(a) The Declaration shall not be amended so as to
materially adversely affect the rights and privileges of
Lessee hereunder, nor shall Lessor give its consent to any
matter for which Lessor's consent is required under the
Declaration which matter would have such a material adverse
effect on the rights and privileges of Lessee hereunder,
without in each case Lessee's prior written consent.
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(b) Lessor does hereby grant, assign and convey unto
Lessee all of the cross easements and other rights to use the
common areas contained in and/or conveyed to Lessor pursuant
to the Declaration, with the same force and effect as if said
rights had been granted directly to Lessee.
(c) Lessor does hereby agree to enforce the cross
easement rights and other rights contained in the Declaration
on Lessee's behalf to the extent necessary for the Lessor to
comply with all of its obligations to Lessee under this Lease.
1.2 LEASE TERM COMMENCEMENT / RENTAL COMMENCEMENT. Commencement of the
term of this Lease shall be the Effective Date ("Lease Term Commencement").
Rental shall be due and payable (the "Rental Commencement Date") on the earlier
of (i) date the restaurant opens for business or (ii) ninety (90) days after
issuing of all permits but in no event shall commencement be later than October
15, 1997. The Rental Commencement Date shall be designated by the parties in a
form capable of being recorded among the public records of ▇▇▇▇▇▇ County, Texas.
The building and other improvements are to be built in accordance with plans and
specifications prepared by Lessee in accordance with the requirements of the
Declaration and approved in writing by Lessor before construction commences. For
purposes hereof, construction shall be deemed to begin when Lessee obtains a
building permit for the building or any other improvements to be constructed by
Lessee on the Land pursuant to the terms hereof.
1.3 COVENANT OF QUIET ENJOYMENT. Lessor promises, subject to Lessee's
performance of all the terms and conditions of the Lease, that Lessee shall be
entitled to the quiet and peaceful enjoyment and undisturbed possession of the
premises for the term of the Lease.
1.4 PURCHASE OPTION. For and in consideration of the non-refundable sum of
$10.00 (the "Option Consideration"), receipt of which is hereby acknowledged,
and of Lessee's full compliance with all of the terms and conditions of this
Lease, Lessor hereby grants to Lessee the right to purchase the premises at any
time during, but not after, the first three (3) years of the initial term of
this Lease for a purchase price equal to the sum of $550,000.00 (which purchase
price is intended to be net to Lessor, with Lessee to be responsible for all
costs of closing, including without limitation, title policy premium, brokerage
commissions, and prepayment premiums, if any, on Lessor's financing applicable
to the premises. The purchase hereunder shall be subject to any easements,
restrictions, liens for real estate taxes not due and payable and other
encumbrances to which the premises are subject as of the date of this Lease and
any additional easements, restrictions and encumbrances thereafter placed on the
premises in connection with the development and/or operation thereof or of the
Shopping Center. such right must be exercised, if at all, by Lessee giving
ninety (90) days advance written notice (the "Exercise Notice") to Lessor in
accordance with the notice provisions of this Lease. The Exercise Notice must be
given on or before the expiration of the first three (3) years of the Lease
term.
The purchase price shall be paid in cash at closing, with closing to occur at
the office of Lessor on the date which is thirty (30) days after Lessor's
receipt of the Exercise Notice. Lessee agrees however to cooperate with Lessor,
upon request of Lessor at any time at or prior to closing, so that the
transaction might be closed as a tax deferred exchange pursuant to Section 1031
of the Internal Revenue Code of 1986, as amended, (or comparable section of any
subsequently enacted federal income tax). The closing may be extended for up to
180 days to accommodate such an exchange, provided however, that said exchange
shall be at no additional cost or liability to Lessee over that which Lessee
would incur in a sales transaction.
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At closing, Lessor shall furnish to Lessee, at Lessee's cost and expense, a
Texas Owner's Policy of Title Insurance on the standard form of policy
prescribed by the Texas State Board of Insurance with standard printed
exceptions and a special warranty deed on the Texas State Bar Form of deed
conveying title free of all encumbrances except as set forth above. Taxes,
operation expenses and rent under this Lease shall be prorated to the date of
closing and Lessee shall additionally pay to Lessor at closing all amounts due
or accrued under this Lease to the date of closing, plus the amount of any
prepayment premium applicable under Lessor's then first lien mortgage financing
covering the premises.
Lessee hereby indemnifies and agrees to hold Lessor harmless with respect to any
brokerage commissions claimed by a person asserting his entitlement thereto at
the alleged instigation of Lessee or otherwise applicable to such sale and
purchase.
This Purchase Option may not be assigned (whether by assignment of this Lease,
separate assignment, or otherwise) by Lessee and any purported assignment of
this Purchase Option shall terminate as of the date of any such purported
assignment. Moreover, upon any purported assignment of this Lease or subletting
of all or any part of the premises, this Purchase Option shall terminate and be
null and void. It is further understood and agreed that any default of Lessee in
the performance of its obligations under this Lease, whether or not waived or
excused by Lessor or cured by Lessee, shall render this Purchase Option null and
void.
1.5 CONDITION. Lessor shall have the right to terminate this Lease if Lessor is
unable to obtain the approval of Lessee's proposed site plan for the premises
from ▇▇▇▇▇▇▇▇▇'▇, Inc. within thirty (30) days from the date hereof, by giving
Lessee written notice thereof on or before expiration of said 30-day period.
Upon any such termination, any amounts theretofore paid by Lessee to Lessor
shall be refunded and the parties shall have no further obligations or
liabilities to each other hereunder.
II.
TERM
2.1 TERM. The term of this Lease (the "term") shall commence on the date set out
in Section 1.2 above, and shall expire at midnight on the twentieth (20th)
anniversary of the Rental Commencement Date (the "term expiration date") unless
sooner terminated as provided in this Lease. Each twelve (12) month period of
the term is sometimes herein referred to as a "Lease Year." Any period of less
than a month from the Rent Commencement Date to the end of that month shall be
added to the first Lease Year.
2.2 RENEWALS. Lessee is granted the option to extend the term of this Lease for
two (2) consecutive extended terms of five (5) years each, provided (a) Lessee
is not in default at the time of exercise of the respective option, and (b)
lessee gives written notice of its exercise of the respective option at least
one hundred eighty (180) days prior to the expiration of the original term or
the expiration of the first renewal term, as the case may be. Each extension
term shall be upon the same terms, conditions and rentals, except (i) Lessee
shall have no further right of renewal after the second extension term
hereunder, and (ii) the monthly Base Annual Rental will be $67,540.00 for the
first extension period and $74,294.00 for the second extension period. Failure
to exercise the first extension option hereunder shall render the second
extension option null and void.
2.3 POSSESSION. Possession of the land shall be delivered to the Lessee on the
Effective Date.
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2.4 HOLDOVER. In the event Lessee remains in possession of the premises after
the expiration of this Lease and without the execution of a new lease, it shall
be deemed to be occupying said premises as a tenant from month to month at a
rental equal to the then most recently applicable rental under Section 3.1 plus
fifty percent of such amount plus any other charges or expenses to be paid by
Lessee and otherwise subject to al the conditions, provisions and obligations of
this Lease insofar as the same are applicable to a month-to-month tenancy.
2.5 END OF TERM. At the expiration or earlier termination of the Lease, the
building fixtures, as defined in Section 15.14 hereafter, located on the
premises shall become the property of the Lessor. If, at that time, Lessee is in
compliance with Lease terms and conditions, Lessor hereby waives any right to
claim any furniture, trade fixtures, signage, unattached kitchen equipment and
other unattached movable personal property (collectively the "personalty") owned
by Lessee located on the premises which pertain to the restaurant and its unique
equipment and fixturing. Notwithstanding anything herein to the contrary,
building fixtures and equipment such as HVAC systems, plumbing, attached kitchen
equipment, window and door systems, built-in cabinets that are a part of the
building, shall remain with the building and become the property of the Lessor.
Should Lessee remove any personalty, Lessee agrees to repair any damage caused
by such removal and return the premises to Lessor in good condition, normal wear
and tear excepted.
III.
CONSIDERATION
3.1 BASE ANNUAL RENTAL. Lessee agrees to pay and Lessor agrees to accept a Base
Annual Rental for each Lease Year (such being hereinafter referred to as
"guaranteed minimum annual rental") as set out below:
Lease Years Annual Rent Monthly Installment
1-5 $51,600.00 $4,300.00
6-10 $54,900.00 $4,575.00
11-15 $58,800.00 $4,900.00
16-20 $61,400.00 $5,116.67
The Base Annual Rental shall be payable in equal monthly installments in advance
by the first day of each calendar month during the term of this Lease commencing
on the Rental Commencement Date. If Rental Commencement Date or a lease
termination (other than for Lessee's default) occurs on date other than the
first day of a calendar month, the monthly installment of the Base Annual Rate
for the month in which commencement or termination occurs shall be prorated on a
daily basis. Notwithstanding the foregoing, upon the execution of this Lease,
Lessee has deposited with Lessor $4,300.00 as security for the faithful
performance and observance by Lessee of the terms, provisions, agreements,
covenants and conditions of this Lease and shall be considered an advance
payment of the first months rent of the initial term, to be applied as such.
3.2 ADDITIONAL CHARGES. Lessor agrees to furnish to Lessee, at Lessor's sole
cost and expense, within thirty (30) days after the date hereof, a current
boundary survey of the premises. Other, in all respects, Lessee and Lessor agree
that the rent accruing under this Lease shall be net to Lessor and that all
costs of platting the premises (as provided in Section 6.1), all costs of
development of the premises
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(as provided in Article XIII), including without limitation obtaining site plan
approval, specific use permit, if any, and taxes, costs, common area maintenance
fees for the premises, expenses and charges of every kind and nature except as
may herein be expressly provided ("additional charges") relating to the premises
(except the taxes of Lessor referred to in Section 6.3 and any payments for
interest or principal under any mortgage relating to Lessor's interest in the
premises) which may arise or become due during the term or any extension of this
Lease, shall be paid by Lessee. All additional charges which Lessee assumes
agrees to pay under any provisions of this Lease, together with all interest and
penalties that may accrue on these additional charges in the event Lessee fails
to pay them, as well as all other damages, costs and expenses, including,
without limitation, reasonable attorneys' fees and other legal and court costs
which Lessor may incur in enforcing this Lease, and any and all other sums which
may become due by reason of Lessee's default or failure to comply with its
obligations under this Lease, shall be deemed to be additional charges. In the
event of non-payment, Lessor shall have all the rights and remedies as provided
in the case of non-payment or rent.
3.3 LATE CHARGES. It is understood that the Base Annual Rental is payable on or
before the first day of each calendar month (in accordance with Section 3.1
above) without offset or deduction of any nature. In the event any rental is not
received within ten (10) days after its due date for any reason whatsoever, or
if any rental payment is by check which is returned for insufficient funds, then
in addition to the past due amount Lessee shall pay to the Lessor a late charge
in an amount equal to ten percent (10%) of the rental then due, in order to
compensate lessor for its administrative and other overhead expenses. Any such
late charge or interest payment shall be payable as additional charges under
this Lease and shall be payable immediately on demand. Notwithstanding the
foregoing, with respect to the first two (2) instances in any calendar year
where a late charge would be due in accordance with the foregoing, such late
charge shall not be due if payment is made within ten (10) day following written
notice from Lessor that the payment is past due.
IV.
INSURANCE
4.1 COVERAGE. During the term, Lessee, at its own cost and expense shall:
(a) Keep the premises and all leasehold improvement and the fixtures
and personalty thereon insured with an all risk insurance policy in an
amount equal to the greater of (i) one hundred percent (100%) of actual
value, or (ii) eighty percent (80%) of the cost of replacement thereof
(less the cost of excavations, foundations, footing and pilings) or
such higher percentage required to avoid application of any
co-insurance clauses in Lessee's policy. Replacement cost shall be
determined from time to time at the request of lessor, but not more
frequently than once in any twelve (12) consecutive calendar months.
Replacement cost shall be determined by one of the insurers or if the
stated replacement cost is not acceptable to Lessor as not reasonably
consistent with similar valuations, at the option of Lessor, by an
appraiser who is mutually and reasonably to lessor and Lessee, and whom
shall be retained and paid by Lessee if the appraiser requires an
increase in the stated replacement cost.
(b) Provide and keep in force comprehensive general liability insurance
against claims for personal injury, death or property damage occurring
on, in or about the premises or the adjoining streets and property, in
limit of not less than $1,000,000 per occurrence for bodily injury, not
less than $500,000 per occurrence for property damage, or in such other
amounts as Lessor may
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reasonably request and as are commonly carried by other restaurants of
a similar nature in the Dallas area.
(c) Provide and keep in force plate glass insurance.
4.2 POLICIES. All insurance required by Lessor and provided by Lessee shall be
carried in favor of lessor and Lessee, as their respective interests may appear,
and any underlying lessor, fee owner, affiliate corporation, trustee, mortgage
or other person designated by Lessor having an insurable interest. All insurance
shall be obtained from companies licensed to do business in Texas and which have
at lease a Class X rating by Best's Insurance Guide or are otherwise approved by
Lessor, such approval not to be unreasonably withheld. Lessee shall procure
policies for all insurance for a period of not less than one year and shall,
prior to commencement of any construction by Lessees deliver to Lessor all
policies or certificates of insurance with evidence of payment of all premiums.
Lessee shall procure renewals of these policies from time to time and deliver
evidence thereof to Lessor before their respective expiration dates. All
insurance policies shall be non-assessable and shall require thirty (30) days
notice by registered mail to Lessor of any cancellation or change affecting
lessor's coverage under the policies. All property damage and business
interruption policies of Lessee shall contain a waiver of any subrogation rights
which Lessee's insurers may have against Lessor, even if the loss suffered is
caused by the act, omission or negligence of Lessor.
4.3 JOINT EFFORTS. Lessee and Lessor shall cooperate in attempts to collect any
insurance proceed that may be due in the event of loss, and Lessee shall execute
and deliver to lessor such proofs of loss and other instruments which may be
required for the purpose of recovering these proceeds.
4.4 WAIVER OF SUBROGATION. Lessor and Lessee each hereby release the other from
any and all liability or responsibility to the other, or to any other party
claiming through or under them by way of subrogation or otherwise, for any loss
or damage to property caused by a casualty which is insurable under standard
fire and extended coverage insurance; provided, however, that this mutual waiver
shall be applicable only with respect to a loss or damage occurring during the
time when property insurance policies, which are readily available in the
marketplace, contain a clause or permit an endorsement to the effect that any
such release shall not adversely affect or impair the policy or the right of the
insured party to receive proceeds under the policy; provided, further, that this
release shall not be applicable to the portion of any damage which is not
reimbursed by the damaged party's insurer because of the "deductible" in the
damaged party's insurance coverage. The release specified in this Section 4.4 is
cumulative with any releases or exculpations which may be contained in other
provisions of this Lease.
4.5 CANCELLATION OF INSURANCE. If any insurance policy covering the premises or
any part of it is not provided by Lessee as herein required or is canceled or is
threatened by the insurer to be canceled, or if the coverage thereunder is
reduced in any way by the insurer for any reason, and if Lessee fails to remedy
the failure or the condition giving rise to cancellation, or reduction of
coverage within five (5) business days after notice thereof by lessor, Lessor
may, at its option, in addition to any other remedies, enter the premises and
remedy the condition giving rise to such cancellation, or reduction, and provide
the required insurance, and Lessee shall forthwith pay the cost thereof to
lessor (which cost may be collected by lessor as rent) and lessor shall not be
liable for any damage or injury caused to any property of Lessee or of others
located on the premises as a result of any such entry other than injury or
damage caused by Lessor's misconduct.
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4.6 LOSS AND DAMAGE. Lessor shall not be liable for any death or injury
occurring on the premises, nor for the loss of or damage to any of the
personalty or other property of Lessee or of others by theft or otherwise, from
any cause whatsoever unless such loss is the result of the negligent act or
omission of Lessor. Without limiting the generality of the foregoing, Lessor
shall not be liable for any injury or damage to persons or property resulting
from fire, explosion, falling plaster, steam, dampness, gas, electricity, water,
rain, snow, or leaks from any part of the premises or from the pipes, appliances
or plumbing works or from the roof, street or subsurface or from any other place
by any other cause whatsoever. Lessor shall not be liable for any such damage
caused by other persons or the public, or caused by operations in construction
of any private, public or quasi-public work. All of the personalty or any other
property of Lessee kept or stored on the premises shall be kept or stored at the
risk of Lessee.
V.
THE PREMISES
5.1 USE.
(a) Restaurant Operation. Lessee will open as a Fresh 'n Lite
restaurant business in the premises promptly upon completion of construction of
the building and shall continuously thereafter during the term and any
extensions thereof operate a restaurant on the premises serving prepared food
and all legal beverages together with incidental carry-out or delivery thereof.
After initially opening as a Fresh 'n Lite restaurant, Lessee may change to a
different restaurant use subject to Lessor's consent, not to be unreasonably
withheld or delayed and to be deemed approved if not objected to within thirty
(30) days). It shall be unreasonably for Lessor to withhold its consent to a
requested use change if (i) the proposed use is a restaurant use consistent with
uses at first-class retail centers in the greater Dallas area, (ii) the proposed
use does not violate any use restrictions or exclusive use rights then in effect
at the Shopping Center, and (iii) the proposed use does not compete with another
tenant then operating within the Shopping Center as determined by Lessor acting
in a commercially reasonable manner.
The premises will be used for no other purpose and under no trade name other
than "Fresh 'n Lite" (or the trade name of any other restaurant operations
permitted under Section 5.1) without Lessor's consent. Lessee shall not at any
time following the Rental Commencement Date leave the premises vacant, but shall
in good faith continuously throughout the term of this Lease conduct and carry
on in the entire premises, the type of business for which the premises is
leased. lessee shall, except during reasonable periods for repairing, cleaning
and decorating, keep the premises open to the public for business during the
periods required hereunder or if otherwise open with adequate personnel in
attendance on all days and during all hours established by Lessee from time to
time as typical business days and store hours for its restaurant operations,
provided that lessee shall not be required to pen before 11:00 a.m. and shall
have the right to close one day a week and on major holidays if consistent in
each case with Lessee's practices at its other restaurant operations. Lessee
agrees that it will not use in connection with the operation of or as additional
parking for its business on the premises any property-other than the premises
and the parking areas designated in the recorded cross easements with the
adjoining properties as available for common parking. Notwithstanding anything
in this Lease to the contrary, the Lessor's obligations under this Lease are
conditioned upon the faithful performance by Lessee of the Declaration and a
default in the terms of the Declaration shall be a default of this Lease. Except
as may be otherwise specifically provided by the terms of this Lease, Lessor
shall not be required to furnish to Lessee any facilities or services of any
kind whatsoever, such as, but not limited to water, sewer, steam, heat, gas
telephone service, sewerage service and other utilities furnished to the
premises. If any utilities furnished to the premises are
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interrupted due to the negligence of Lessor or Lessor's employees or contractors
for more than forty-eight (48) hours, Base Annual Rental shall thereafter
equitably ▇▇▇▇▇ in proportion to the extent of interference with Lessee's
business operations until such utilities are restored.
(b) Exclusive. The use of Parcels 1, 3, 4 and 7 of the Shopping Center
by lessor or any other owner or occupant shall be subject to the following
covenants and restrictions. As a material inducement for Lessee to enter into
this Lease, Lessor agrees that during the term and any extension terms, Parcels
1, 3, 4 and 7 of the Shopping Center shall not be used as, or sold or leased for
use as, a healthier dining concept restaurant or food service establishment,
such as Eureka's, Bless Your Heart, Preston's or the like; provided, however,
said Parcels 1, 3, 4 and/or 7 may be used as, or sold or leased for use as, a
restaurant or food service establishment which prepares, serves or sells healthy
dining products so long as such sales are incidental to the sale of its other
products. As used herein, the term "incidental" shall mean that any such owner,
tenant or occupant shall not derive more than thirty percent (30%) of its annual
gross sales from the sale of healthier dining concept products. This restrictive
covenant and exclusive use is subject to the following provisions:
(a) If a Fresh 'n Lite restaurant does not open for business
within 365 days after the Lease Term Commencement, then this
restrictive covenant and exclusive use shall automatically terminate as
to said Parcels 1, 3, 4 and 7 of the Shopping Center.
(b) If, after the opening of a Fresh 'n Lite restaurant, such
restaurant ceases to serve or sell primarily healthier dining concept
products, then this restrictive covenant and exclusive use shall
automatically terminate.
(c) Lessee's rights hereunder are subject to the rights of BC
Texas, Inc. under existing lease with Lessor covering a portion of
Parcel 1 (except that no assignee or sublessee of BC Texas, Inc. shall
be allowed to violate Lessee's exclusive hereunder).
5.2 REPAIRS AND MAINTENANCE.
(a) Common Area. Lessor will maintain (or cause to be maintained) in
good order, condition and repair all parking areas and other areas (exclusive of
the premises and of areas within the premises of any occupants of the Shopping
Center) used in common by tenants and occupants of the Shopping Center (the
"Common Area"), and Lessor hereby grants to Lessee, its agents, employees and
invitees, the nonexclusive right to use the Common Areas in common with Lessor
and the other tenants and occupants of the Shopping Center, and their respective
agents, employees and invitees, subject to the terms of the Declaration and the
reasonable written rules and regulations from time to time promulgated by Lessor
governing the use of the Common Areas.
(b) Premises. Subject to Section 5.2(a) of this Lease, lessee shall, at
all times during the term, at its own cost and expense, keep and maintain all
leasehold improvements, and all fixtures and personalty located thereon, and all
parking areas, driveways and landscaping thereon, in good order and condition,
ordinary wear and tear excepted (but in any event in compliance with the
requirements of the Declaration) and subject to all applicable terms of Sections
5.3 and 5.8, shall make all necessary and desirable repairs, restorations and
replacements thereof, interior and exterior, structural and nonstructural,
foreseen and unforeseen (hereinafter collectively called "repairs"), and shall
use all reasonable precaution to prevent
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waste, damage or injury. Without limiting the coverage of the previous sentence,
it is understood that Lessee's responsibilities therein include the repair and
replacement of all lighting, heating, air conditioning, plumbing and other
electrical, mechanical and electromotive installation, equipment and fixtures
and also include all utility repairs in ducts, conduits, pipes and wiring, and
any sewer stoppage located in, under and above the premises, regardless of when
or how the defect or other cause for repair or replacement occurred or became
apparent.
In the event that Lessee fails or neglects to make all necessary repairs or
fulfill its other obligations as set forth above within thirty (30) days after
written notice thereof from Lessor, Lessor or its agents may enter the premises
for the purpose of making such repairs or fulfilling those obligations. All
costs and expenses incurred as a consequence of Lessor's action shall be repaid
by lessee to Lessor within thirty (30) days after Lessee receives copies of
receipts showing payment by Lessor for such repairs or other obligations. These
receipts shall be prima facie evidence of the payment of the charges paid by
Lessor. In the case of emergency, Lessor shall only be required to give Lessee
such notice as is reasonable under the circumstances before taking any such
action.
5.3 ALTERATIONS. Lessee shall not at any time make any alteration, change,
addition or improvement (hereinafter collectively called alterations) in or to
the structural or exterior of the premises without the prior written consent of
Lessor, which consent shall not be unreasonably withheld or delayed. Without
Lessor's consent being required, Lessee may make such interior nonstructural
alterations as Lessee may deem appropriate, provided that where such alterations
are desired costing in excess of $20,000 in connection with any particular
remodeling, Lessee will furnish copies of the plans and specifications therefor
to Lessor prior to commencing such work. For purposes hereof, mechanical,
electrical and plumbing systems shall be deemed "structural." In any event:
(a) the alterations shall be performed in a first class
workmanlike manner at Lessee's sole expense, and shall not weaken or
impair the structural strength or lessen the value of the premises, and
shall be conducted in such manner as to cause a minimum of interference
with other construction in progress and with the transaction of
business in the Shopping Center. Lessee agrees to indemnify Lessor and
hold Lessor harmless against any loss, liability or damage resulting
from such work; not to be unreasonably withheld or delayed (and deemed
approved if not objected to by Lessor within fifteen (15) days after
Lessor's receipt thereof);
(b) the alterations shall be made according to plans and
specifications therefor, which shall be first submitted to and where
required, approved in writing by Lessor;
(c) before the commencement of work on any alterations, such
plan and specifications shall be approved by all governmental
authorities having jurisdiction and any public utility company having
an interest in the alterations; and
(d) before the commencement of any alterations, lessee shall
pay the amount of any increase in premiums on insurance policies for
endorsement covering the risk during work on the alterations, and
workmen's compensation insurance, if any, covering all persons employed
in connection with that work.
All alterations, improvements and fixtures (including, without limitation, all
floor coverings and all heating and air conditioning equipment but excluding
lessee's unattached, readily movable furniture and office
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equipment) which may be made or installed by either party upon the premises
shall remain upon and be surrendered with the premises and become the property
of Lessor at the termination of this Lease, in good condition, ordinary wear and
tear, casualty and condemnation excepted.
5.4 LIEN. Should Lessee cause any alterations or repairs to be made to the
premises, or cause any labor to be performed or material to be furnished,
neither Lessor nor the premises shall under any circumstances be liable for the
payment of any expense incurred, and all such alterations and repairs shall be
made and performed at Lessee's expense. If, because of any act or omission of
Lessee, any mechanic's or other lien, charge, claim or order for the payment of
money shall be filed against the premises or against Lessor, Lessee shall, at
its own cost and expense, cause it to be canceled and discharged of record or
bonded within fifteen (15) days after notice of filing thereof. In the event
that the lessee fails to cause any such mechanics' or other lien, charge or
order to be canceled and discharged or bonded, then, in addition to any other
right or remedy of the Lessor, the Lessor may, at its option, cancel or
discharge it by paying the amount claimed to be due into Court or directly to
any claimant and the amount so paid by lessor and all costs and expenses
including attorney's fees incurred for the cancellation or discharge of such
lien shall be due from the Lessee to the Lessor as an additional charge payable
on demand.
Notwithstanding anything herein to the contrary, except as set out in Section
11.3, the Lessee shall have no right, power or authority, in law or in equity,
to mortgage, encumber, or otherwise pledge or transfer the rights, if any, of
the Lessor under this Lease, and all liens, if any, created by the Lessee shall
apply only to the interest of Lessee under this Lease.
5.5 SIGNS. Lessee shall be permitted maximum signage allowed by the City of The
Colony, provided that Lessee shall only place approved Fresh 'n Lite signs or
symbols (or signs and symbols of any other restaurant operation permitted under
Section 5.1) on the premises and they shall be and remain the property of the
Lessee. All signs (including without limitation monument signs, if any) shall be
constructed and installed at Lessee's sole cost and expense, and must be in
conformity with the Declaration and all city, county and state rules,
regulations and laws. Lessor must approve all exterior signage of Lessee before
it is installed, not to be unreasonably withheld.
5.6 INSPECTION. Fee owner, Lessor or their representatives shall have the right
upon prior written notice (except in case of emergency) to enter the premises at
reasonable hours of any business day to ascertain if the premises are in proper
repair and condition or to show the premises to prospective purchasers or
lenders (or tenants during the final one hundred twenty (120) days of the Lease
term). Lessee will permit Lessor to place and maintain "For Rent" or "For Lease"
signs on the premises during the last ninety (90) days of the Lease term, as
same may be extended pursuant to Section 2.2.
5.7 LICENSES AND LAWS. The Lessee shall, at its own cost and expense, obtain all
necessary licenses and/or permits which may be required for the conduct of its
business and Lessee shall, at its own cost and expense, promptly observe and
comply with all applicable laws, ordinances, requirements, orders, directions,
rules and regulations (referred to generally as "regulations") of governmental
authorities having or claiming jurisdiction over the premises or the conduct of
Lessee's business. Lessee may contest in good faith, after notice to Lessor, by
appropriate proceedings conducted promptly at Lessee's own expense, in Lessee's
name (and/or whenever necessary and with Lessor's consent, in Lessor's name),
the validity or enforcement of any such regulation provided that (i) such
contest or any associated deferment of payment does not subject Lessor to a fine
or other criminal liability, or subject the premises to any encumbrance, (ii)
Lessee diligently prosecutes such contest to a final determination by the
governing
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authority, and (iii) Lessee furnished Lessor with any security that Lessor may
reasonably request in connection with such contest.
5.8 DAMAGE OR DESTRUCTION. If, during the term, the premises or the improvements
or fixtures thereon are destroyed or damaged in whole or in part by fire or
other cause, lessee shall give Lessor immediate notice, and Lessee, at its own
cost and expense, shall cause the prompt repair, replacement and rebuilding of
same ("restoration"), subject without limitation to Sections 5.2 and 5.3 of this
Lease. Lessor shall in no event be called upon to repair, replace or rebuild any
such buildings, fixtures or personalty, nor to pay any of the costs or expenses
thereof beyond or in excess of any insurance proceeds made available to Lessee
under this Lease.
All insurance proceeds on account of such damage or destruction shall be applied
to pay or reimburse Lessee for the payment of the cost of restoration of the
building and other leasehold improvements on the premises, including the cost of
temporary repairs or for the protection of the premises pending the completion
of permanent restoration. In the event of substantial damage (hereinafter
defined), Twenty Five Thousand Dollars ($25,000.00) of the insurance proceeds
shall be disbursed by the insurer directly into an escrow account with an
escrowee reasonably acceptable to Lessor and Lessee, with such sum to be
distributed to Lessee upon the furnishing of proof reasonably satisfactory to
Lessor of lien free completion of the restoration, but to be distributed to
lessor upon any default by Lessee with respect to the restoration (such escrow
amount in no way to limit Lessee's liability for any such default).
If the insurance proceeds and other funds deposited with Lessor or the
applicable mortgage, less the actual cost, fees and expenses, if any, incurred
in connection with the adjustment of the loss, are insufficient to pay the
entire cost of the restoration, Lessee will pay the deficiency. During
restoration, Lessee shall continue the operation of its business within the
premises to the extent practicable, this Lease shall terminate, nor shall rental
and other charges payable under this Lease be abated or affected in any manner.
Notwithstanding the foregoing in this Section 5.8, if the building and other
leasehold improvements on the premises shall be substantially damaged (fifty
percent (50%) or more of the insurable value of the building) or destroyed by
fire, windstorm, or otherwise, within the last year of the term of this Lease,
as same may be extended pursuant to Section 2.2, either party shall have the
right to terminate this Lease, provided that notice thereof is given to the
other party not later than sixty (60) days after such damage or destruction. If
said right of termination is exercised, this Lease and the term hereof shall
cease and come to an end as of the date of such damage or destruction and the
herein referenced insurance proceeds shall belong solely to Lessor.
5.9 WARRANTIES DISCLAIMER. The premises is being leased "AS IS," with Lessee
accepting all defects, if any, and Lessor makes no warranty of any kind, express
or implied, with respect to the premises (without limitation, Lessor makes no
warranty as to the habitability, fitness or suitability of the premises for a
particular purpose nor as to the absence of any toxic or other hazardous
substances). this section 5.9 is subject to any contrary requirements under
applicable law, however, in this regard, Lessee acknowledges that it has been
given the opportunity to inspect the premises and to have qualified experts
inspect the premises prior to the Lease Term Commencement. Lessee acknowledges
that neither Lessor nor its agents have made any representations or promises
with respect to the premises except as expressly set forth in this Lease, and no
rights, easements or licenses are acquired by Lessee by implication or otherwise
except as expressly set forth herein. The taking of possession of the premises
by Lessee shall be conclusive evidence that the Lessee has accepted the premises
"AS IS". Lessor agrees to reasonably
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cooperate with and assist Lessee, at no cost to Lessor, in asserting claims
against contractors or others providing work and/or services to the premises.
VI.
TAXES AND OTHER CHARGES
6.1 PAYMENT. From and after the Rent Commencement Date Lessee shall pay as they
become due and payable all real estate taxes (both real and personal),
assessments (both general and special) and other governmental impositions, but
only to the extent of charges lawfully created and assessed against the premises
or any part thereof after the Rent Commencement Date and prior to the expiration
of the term of this Lease. Any such tax, assessment, imposition or other similar
expense created, levied, or arising prior to the Rent Commencement Date, any
installment of any such charge created prior to the Rent Commencement Date or
any charge applicable to a period of time prior to the Rent commencement Date,
but assessed or otherwise imposed during the term hereof, shall be paid by
Lessor. Lessee shall deliver to Lessor, if requested, receipts or other
reasonably satisfactory evidence of payment of all such taxes, assessments and
governmental impositions so paid by Lessee Lessor shall have the right, but no
obligation, to take all necessary steps to replat the premises, but whether or
not the same is replatted Lessor shall make all reasonable efforts to have the
premises taxed as a separate parcel by the applicable governmental authorities,
and Lessee agrees to use its best efforts to cooperate with Lessor in such
process (it being understood and agreed that any costs of replatting the
premises as a separate lot shall be the responsibility of Lessee). In the event
the premises are not taxed or assessed as a parcel separate from a larger tax
parcel, Lessee will pay Lessor as additional rent, an amount equal to Lessee's
proportionate share of any such taxes or assessments based on values agreed to
between Lessor and Lessee using the services of a mutually acceptable tax
consultant compensated by Lessor. In such event Lessor shall pay such taxes
prior to delinquency and promptly furnish evidence of same to Lessee.
6.2 CONTESTS. It is agreed, however, that Lessee, at its sole cost and expense,
may dispute and contest the same (in its own name or in the name of Lessor, or
in the name of both, as it may deem appropriate), and in such cases the disputed
charge need not be paid until finally adjudged to be valid. At the conclusion of
such contest, Lessee shall pay the charge contested to the extent it is held
valid, together with all court costs, interest, penalties and other expenses
relating thereto. Nothing herein contained, however, shall be construed as to
allow such items to remain unpaid for such length of time as shall permit the
premises (or any part thereof) to be sold by governmental, city or municipal
authorities for the non-payment of the same.
VII.
INDEMNIFICATION
7.1 Lessee shall indemnify and save Lessor harmless from and against all costs,
expenses, liabilities, losses, damages, injunctions, suits, actions, fines,
penalties, claims and demands of every kind or nature, including reasonable
attorney's fees, by or on behalf of any person, party or governmental authority
whatsoever arising out of any matter relating to Lessee's occupation of the
premises and resulting from: (a) any failure by Lessee to perform any of its
obligation ▇▇▇▇▇▇ this Lease, (b) any accident, injury or damage which occurs in
or about the premises, however occurring, (c) any matter arising out of the
condition, occupation, maintenance, alteration, repair, use or operation of the
premises or any part of it, and (of) the contest or challenge by Lessee of any
imposed tax, assessment or other charges, unless the
d
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indemnified loss is caused wholly or in part by Lessor's negligence, in which
event this indemnity shall not apply to the allocable share of such loss
resulting from Lessor's negligence.
VIII.
ENFORCEMENT
8.1 DEFAULT. Each of the following events is a default and a breach of
this Lease by Lessee:
(a) If Lessee ceases its restaurant operation sin or vacates or
abandons the premises or any substantial portion thereof or indicates
its intention to do so during the Lease term (it being understood and
agreed, however, that Lessee may cease operations in the premises for
reasonable periods of up to ninety (90) days in connection with bona
fide remodeling or repair and restoration in connection with a
permitted use change, an assignment or subletting, casualty or
condemnation without such cessation being a default hereunder), or at
any time prior to the last month of the Lease term shall remove or
attempt to remove, without the prior written consent of Lessor, all or
a substantial amount of Lessee's goods, wares, equipment, fixtures,
furniture, or other personal property without immediate replacement.
(b) If this Lease or the estate of Lessee hereunder is transferred to
another person or party, except in a manner permitted by the terms of
this Lease.
(c) If Lessee fails to pay Lessor any rent or other charge when it
becomes due and payable and fails to make such payment within ten (10)
days after written notice thereof by Lessor is received by Lessee
provided, however, that for each calendar year during which Lessor has
already given Lessee two (2) written notices of the failure to pay an
installment of rental, no further notice shall be required (i.e., the
event of default with automatically occur on the tenth day after the
date upon which the rental was due).
(d) If Lessee fails to perform any of its obligations under this Lease
(other than those above specified in this Section 8.1) and such
non-performance continues for a period of thirty (30) days after
written notice thereof by Lessor is received by Lessee or, if such
performance cannot be reasonably had within such thirty (30) day
period, Lessee has not in good faith commenced such performance within
such thirty day period or has not diligently proceeded therewith to
completion.
In the event of a default under subparagraphs (a) or (b) above, the term of this
Lease shall at Lessor's election automatically terminate without additional
notice to Lessee. Lessor shall have all other rights and remedies available, at
law or in equity, for such a breach. In the event a default under subparagraphs
(c) or (d), above, shall occur and be continuing after the notice period
provided, Lessor has the right, in addition to any other rights or remedies it
may have, to terminate this Lease without further notice to Lessee, and in such
event the term hereof shall expire in the same manner and with the same force
and effect, except as to Lessee's liability, as if the expiration of the time
fixed in such notice was the original term expiration date.
8.2 CURE BY LESSOR. To the extent reasonably susceptible to cure by Lessor,
after expiration of the applicable period of notice, or without notice in the
event of any emergency, Lessor at its option may, but shall not be obligated to,
make any payment required of Lessee or perform any obligation of Lessee, and the
amount Lessor pays, or the cost of its performance, together with interest
thereon at 12% per
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annum, shall be deemed to be an additional charge payable by Lessee on demand.
Lessor shall have the right to enter the premises for the purpose of correcting
or remedying any default susceptible to cure by Lessor, but neither any
expenditure nor any such performance by Lessor shall be deemed to waive or
release Lessee's default or the right of Lessor to take such action as may be
otherwise permissible in the case of default. The Lessor shall have no liability
to the Lessee for any loss or damages resulting from any such action by the
Lessor and entry by the Lessor under the provisions of Article V or VIII shall
not constitute breach of the covenant for quiet enjoyment or an eviction.
8.3 SURRENDER; REENTRY; RELETTING. In the event of cancellation or termination
of this Lease either by operation of law or otherwise, or in the event Lessor
gives notice to Lessee to vacate the premises pursuant to a default of this
Lease, Lessee agrees to immediately peacefully surrender the premises to Lessor,
and if Lessee refuses to do so, Lessor may, among other things, reenter and
repossess the premises, using such force for that purpose as may be necessary,
and whether or not this Lease is canceled or terminated Lessee shall
nevertheless remain and continue to be liable to Lessor in a sum equal to all
rent, additional rent and other charges payable under this Lease through the
then current term expiration date. If Lessor shall so reenter, Lessor may repair
and alter the premises in any manner as Lessor deems reasonably necessary or
advisable, and/or may, at its election, let or relet the premises or any part of
it for the whole or any part of the remainder of the term or for a longer
period, in Lessor's name or as the agent of Lessee, and out of any rent
collected or received from subtenants or as a result of such letting or
reletting, Lessor shall first pay to itself the cost and expense of retaking,
repairing and/or altering the premises, and the cost and expense of removing all
persons and property from the premises, second, pay to itself the cost and
expense sustained in securing any new tenant, and if Lessor maintains and
operates the premises, the cost and expense of operating and maintaining the
premises and, third, pay to itself any balance remaining on account of the
liability of Lessee for the sum equal to all rent, additional rent and other
charges due from Lessee through the then current term expiration date, provided
that Lessee shall not be entitled to receive any proceeds in excess of the
rental owed hereunder (other than as a credit as below specified). It is
expressly agreed that (without limitation) in determining "additional rent and
other charges due from Lessee," as that term is used above, there shall be added
to the Base Annual Rental a sum equal to the costs of maintenance of the
premises, all payments for taxes, charges and insurance payable by Lessee (as
specified in this Lease). Should Lessor, pursuant to this paragraph, not collect
rent which, after deductions is sufficient to fully pay to Lessor a sum equal to
all rent, additional rent and other charges payable through the original term
expiration date, the balance or deficiency shall, at the election Lessor, be
paid by Lessee on the first day of each month. Should Lessor collect rent which,
after deductions, shall exceed Lessee's then current obligations pursuant to
this Lease, such excess shall be credited to Lessee's on-going contingent lease
liability hereunder.
8.4 ACCELERATION. After occurrence of a default, whether or not Lessor relets
the premises, Lessor may whenever Lessor desires, demand a final settlement.
Upon demand for a final settlement, Lessor shall have a right to, and Lessee
hereby agrees to pay, the difference between the total of all monthly rentals
and other charges provided in this Lease for the remainder of the term and the
reasonable rental value of the premises for such period, such difference to be
discounted to present value at a rate equal to the rate of interest which is
allowed by law in the State of Texas when the parties to a contract have not
agreed on any particular rate of interest (or, in the absence of such law, at
the rate of six percent (6%) per annum).
8.5 SUITS. After occurrence of a default, suit or suits for the recovery of the
deficiency or damage or for any installment or installments of rent, additional
rent or any other charge due under this Lease may
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be brought by Lessor at any time or, at Lessor's election, from time to time,
and nothing in this Lease shall be deemed to require Lessor to wait until the
original term expiration date to bring suit.
8.6 WAIVER. After occurrence of a default, Lessee, except as set out in Section
8.1 hereof, hereby expressly waives service of any notice of intention to
reenter. Lessee hereby waives any and all rights to recover or to regain
possession of the premises or to reinstate or to redeem this Lease as permitted
or provided by any statute, law or decision now or hereafter in force and
effect. No receipt of moneys by Lessor from Lessee after the cancellation or
termination of the Lease shall reinstate, continue or extend the Lease, or
affect any prior notice given to Lessee or operate as a waiver of the right of
Lessor to enforce the payment of rent and additional rent then due or
subsequently falling due, or operate as a waiver of the right of Lessor to
recover possession of the premises by suit, action, proceeding or other remedy,
and any and all moneys so collected shall be deemed to be payments on account of
the use and occupancy of the premises, or at the election of the Lessor, on
account of Lessee's liability under this Lease.
8.7 PROOF OF CLAIM. Nothing in this Article shall limit or prejudice the right
of Lessor to prove and obtain as liquidated damages in any bankruptcy,
insolvency, receivership, reorganization or dissolution proceeding an amount
equal to the maximum allowed by any statute or rule of law governing such
proceeding, whether or not such amount is greater, equal to or less than the
amount of the damages referred to in any of the preceding sections.
8.8 INJUNCTION. In the event of a breach by Lessee of any of its Lease
obligations, Lessor shall have the right to enjoin and restrain the breach and
to invoke any remedy allowed by law or in equity in addition to other remedies
provided in this Lease.
8.9 INDEPENDENT RIGHTS. The rights and remedies of Lessor are distinct, separate
and cumulative, and no one of them, whether or not exercised by Lessor, shall be
deemed to be to the exclusion of any of the others.
8.10 NON-WAIVER. The failure of Lessor to insist upon strict performance of any
of Lessee's obligations under this Lease shall not be deemed a waiver of any
rights or remedies that Lessor may have and shall not be deemed a waiver of any
subsequent breach or default by Lessee.
8.11 WAIVER OF EXEMPTION FROM DISTRESS. Lessee agrees that notwithstanding
anything contained in any statute, enactment or other law of, the State of Texas
or of any other jurisdiction, none of the personalty located on the premises
shall be exempt from levy for distress for rent in arrears, and that if Lessee
makes any claim for such an exemption, this agreement may be pleaded as an
estoppel against Lessee in any appropriate action.
IX.
RENT ABATEMENT
9.1 Unless specifically provided in this Lease, no abatement, diminution, or
reduction of rent, additional rent, charges or other compensation shall be
claimed by or allowed to Lessee, or any persons claiming under Lessee, under any
circumstances, whether for inconvenience, discomfort, or interruption of
business.
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X.
CONDEMNATION
10.1 ENTIRE AWARD. In the event that the premises or any part of it is taken in
condemnation proceedings or by exercise of any right of eminent domain (or by
settlement agreement in lieu thereof between Lessor and those authorized to
exercise such right), Lessor shall be entitled to collect the entire amount of
any award made, without deduction for the value of the remaining primary term of
the estate vested in or owned by Lessee, subject only to Lessee's rights as set
forth in Section 10.4. Lessee agrees to execute any and all documents that may
be required to facilitate collection by Lessor of any and all such awards.
Lessee shall have no right to participate in any condemnation proceedings or
agreement except for the purposes described in Section 10.5.
10.2 SUBSTANTIAL TAKING. If at any time during the Lease Term, the whole or
substantially all of the premises is taken or condemned, this Lease shall
terminate and expire on the date on which title vests in the condemning
authority, upon which the rent provided to be paid by Lessee shall be
apportioned and paid to that date, and Lessee shall have no claim against Lessor
for the unexpired term of this Lease or for damage or for any other reason
whatsoever. For the purpose of this Section "Substantially all of the premises"
shall be deemed to have been taken if the portion of premises not taken cannot
be repaired or reconstructed in such a way that, by using only the amount of the
net award available from the taking, there remains a complete, rentable
structure capable of producing performance in a proportionately fair and
reasonable net annual income after payment of all operating expenses, rent,
additional rent and all other charges payable by Lessee, and after performance
by the Lessee of all its obligations under this Lease. This Lease shall not
terminate, and Section 10.3 of this Lease shall be applicable, if Lessee gives
Lessor written notice within thirty (30) days after physical possession is taken
by the condemning authority that Lessee elects to pay all costs of restoration
in excess of said net award.
10.3 PARTIAL TAKING. In the event of a partial taking (any taking which is not
"substantial"), this Lease shall not terminate, and Lessee shall promptly
proceed to restore the remainder of the building on the Land (if affected by the
taking) to a complete, independent and self-contained architectural unit, usable
for the purposes contemplated by this Lease. Lessor shall pay to Lessee, subject
to the same provisions and limitations specified herein with respect to
insurance proceeds, the cost of restoration in excess of any award made to
Lessee hereunder, which payment by Lessor shall in no event exceed a sum equal
to the amount of any separate award paid to Lessor for such restoration. Any
award to Lessee under Section 10.5 below shall first be applied against such
restoration costs, and after Lessor's payment of obligation hereunder, any
deficiency will be paid by Lessee. Such restoration shall be subject to and
shall be performed in accordance with the provisions of Section 5.3.
If this Lease does not terminate as provided in Section 10.2, the new guaranteed
minimum annual rental (but not percentage rental) payable hereunder during the
unexpired portion of this Lease shall be reduced in proportion to the area of
the building taken, effective on the date physical possession is taken by the
condemning authority.
10.4 LESSEE'S INDEPENDENT AWARD. Nothing in this article shall preclude Lessee
from pursuing any independent action permitted by law or from participating in
the same condemnation proceeding with Lessor but only for the purpose for
securing an independent condemnation proceedings award fro the Unamortized
Costs, loss of business or damage to personalty. Lessor shall receive the
balance of the
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award with respect to said improvements and the entire award with respect to the
Land shall belong to Lessor.
XI.
SUBORDINATION AND MORTGAGEE'S RIGHTS
11.1 SUBORDINATION. Lessee accepts this Lease subject to any mortgage, deed of
trust or other lien presently existing or hereafter placed upon the Shopping
Center or any portion of the Shopping Center which includes the premises, and to
any renewals and extensions thereof. Lessee agrees that any mortgagee shall have
the right at any time to subordinate its mortgage, deed of trust or other lien
to this Lease provided, however, notwithstanding that this Lease may be (or made
to be) superior to a mortgage, deed of trust or other lien, and the mortgagee
shall not be liable for prepaid rentals, security deposits and claims accruing
during Lessor's ownership. Lessee agrees upon demand to execute such further
instruments as Lessor may request to subordinate this Lease to any mortgage,
deed of trust or other lien hereafter placed upon the premises or the Shopping
Center as a whole, provided such mortgagee simultaneously executes and delivers
to Lessee a written agreement in form reasonably acceptable to Lessor and Lessee
that after a foreclosure (ro a deed in lieu of foreclosure) the rights of Lessee
shall remain in full force and effect during the term of this Lease so long as
Lessee shall continue to recognize and perform all of the covenants and
conditions of this Lease and providing for attornment on the part of Lessee and
further provided that Lessee shall not be required to execute any promissory
notes or other evidences of indebtedness which would create any personal
liability on behalf of Lessee.
11.2 NOTICE TO MORTGAGEE. At any time when the holder of an outstanding
mortgage, deed of trust or other lien covering Lessor's interest in the premises
has given Lessee written notice of its interest in this Lease, Lessee may not
exercise any remedies for default by Lessor hereunder unless and until the
holder of the indebtedness secured by such mortgage, deed of trust or other lien
shall have received written notice of such default and a reasonable time (not
less than 30 days) shall thereafter have elapsed without the default having been
cured.
11.3 MORTGAGING OF LEASEHOLD ESTATE. Upon prior notice to Lessor of its intent
to do so, Lessee shall have the right to mortgage and pledge this Lease to any
institutional Lender or financial entity subject, however, to the limitations
herein contained. Any such mortgage or pledge shall be subject and subordinate
to the rights of the Lessor hereunder and the holder of any mortgage or deed of
trust of the fee in and/or upon which the premises is located (hereinafter
called "Mortgagee"). No holder of a mortgage on this Lease (hereinafter called
"Leasehold Mortgage and/or Leasehold Mortgagee"). No holder of a mortgage on
this Lease (hereinafter called "Leasehold Mortgage and/or Leasehold Mortgagee")
shall have the rights or benefits mentioned in this Section 11.3, nor shall the
Lessor or its mortgagee be bound by this Section unless and until an executed
counterpart of such Leasehold Mortgage and of each assignment thereof or a duly
authenticated copy shall have been delivered to Lessor and its mortgagee. The
Leasehold Mortgagee shall permit all casualty insurance proceeds and
condemnation awards to be applied to the costs of restoration as specified in
this Lease.
In the event of any termination of this Lease in connection with any casualty or
condemnation the maximum amount of insurance proceeds or condemnation award to
which Lessee (or the Leasehold Mortgagee) is entitled to receive, regardless of
the then actual outstanding balance of any Leasehold Mortgage, shall be the
Unamortized Costs, with Lessor to receive the balance of the insurance proceeds
or condemnation award, as the case may be. Otherwise, neither Lessor nor the
premises or leasehold
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improvements at any time thereon be subject to any claim, lien or charge in
favor of any Leasehold Mortgagee if the Lease is terminated in accordance with
its terms prior to payment in full by Lessee of any Leasehold Mortgagee, in
which event such leasehold improvements shall become the sole property of Lessor
without compensation to Lessee or any Leasehold Mortgagee.
If Lessee shall mortgage this Lease in compliance herewith, then so
long as any such mortgage shall remain unsatisfied of record, the following
provisions shall apply:
(a) Lessor, shall serve a copy of any notice of default sent to Lessee
upon the holder of such Leasehold Mortgage at the last address of which Lessor
is given by said Leasehold Mortgagee.
(b) The holder of the Leasehold Mortgage shall, within the same period
and otherwise as herein provided, have the right to remedy such default, or
cause the same to be remedied. Lessor shall accept such performance by or at the
instance of such holder as if the same had been made by Lessee.
(c) No event of default shall be deemed to exist under the terms of
this Lease in the performance of work required to be performed, of acts to be
done, or of conditions to be remedied, if steps shall, diligently and in good
faith, have been commenced and completed by or for the Leasehold Mortgagee
within the time permitted to do so with diligence and continuity as provided in
this Lease.
(d) In the event of the termination of this Lease prior to the
expiration of the term, except by eminent domain, damage or destruction as
herein provided, Lessor shall serve notice to the Leasehold Mortgagee that the
Lease has been terminated. Such notice shall include a statement of any and all
sums which would at that time have been due under this Lease but for such
termination. The Leasehold Mortgagee shall thereupon have the option to obtain a
new Lease in accordance with and upon the following:
(i) Such options must be exercised by written notice to Lessor
given within thirty (30) days following receipt by the Leasehold Mortgagee of
Lessor's notice of Lease termination, failing which, such option shall be null
and void. The new Lease shall be effective as of the date of termination of this
Lease, and shall be for the remainder of the term of this Lease and at the rent
and upon all of the original agreements, terms, covenants and conditions hereof,
including any rights of renewal. Such new Lease shall require the Leasehold
Mortgagee to perform any unfulfilled obligation of Lessee under this Lease.
Failure of the Leasehold Mortgagee to execute and deliver the new Lease to
Lessor within ten (10) days after Lessor delivers same to Leasehold Mortgagee
shall render the Leasehold Mortgagee's rights hereunder null and void.
(ii) Upon the execution of such new Lease, the Lessee named
therein shall pay any and all sums which would at the time of the execution
thereof be due under this Lease but for such termination and shall pay all
expenses including, but not limited to, reasonable counsel fees, court costs and
disbursements incurred by Lessor in connection with any default and termination,
the recovery of possession of said premises, and the preparation, execution and
delivery of the new Lease.
(e) Any notice or other communication which Lessor shall desire or is
required to give to or serve upon the holder of a Leasehold Mortgage on this
Lease shall be in writing and shall be served in the same manner as upon Lessee
as provided in Section 15.2, addressed to such holder at his address as
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set forth in such Leasehold Mortgage or in the last assignment thereof delivered
to Lessor or at such other address as shall be designated by such holder by
notice in writing given to Lessor.
(f) The union of the interests of Lessor and Lessee herein shall not
result in a merger of this Lease into the fee interest.
If any Leasehold Mortgagee shall acquire title to Lessee's interest in
this Lease, by foreclosure of a Leasehold Mortgage thereon or by assignment in
lieu of foreclosure or by an assignment from a designee or wholly owned
subsidiary corporation of such Leasehold Mortgagee, or under a new Lease
pursuant to this Article, then such Leasehold Mortgagee shall be otherwise bound
by this Lease, but may assign such Lease in accordance with the provisions of
Section 12.2 herein and shall thereupon be released from any and all liability
for the performance or observance of the covenants and conditions in such Lease
contained on Lessee's part to be performed and observed from and after the date
of such assignment, provided that Lessor shall have received an executed
counterpart of said assignment, together with the name and address of the
assignee and further provided that Lessor also be sent an assumption by the
assignee, all in recordable form.
XII.
ASSIGNMENT
12.1 BY LESSOR. This Lease shall be fully assignable by the Lessor or its
assigns. In the event of the transfer and assignment by Lessor of its interest
in this Lease and in the building constituting a part of premises to a person
expressly assuming Lessor's obligations under this Lease, Lessor shall thereby
be released from any further obligations hereunder, and Lessee agrees to look
solely to such successor in interest of the Lessor for performance of such
obligations. Any security given by Lessee to secure performance of Lessee's
obligations hereunder may be assigned and transferred by Lessor to such
successor in interest and Lessor shall thereby be discharged of any further
obligation relating thereto.
12.2 BY LESSEE. Except as otherwise provided in this Section 12.2, Lessee may
not assign this Lease or sublease the premises, in whole or in part, without the
express written consent of Lessor, which consent shall not be unreasonably
withheld. Lessor shall consent or withhold such consent by written notice to
Lessee within thirty (30) days of Lessee's written request for Lessor's consent
which request shall include the identity and financial statements for the
current and two (2) preceding fiscal years of the proposed transferee, the
proposed use, and the proposed assignment or sublease document. If Lessor fails
to respond to Lessee's request within such 30-day period, Lessor shall be deemed
to have consented to such assignment or subletting. It shall be unreasonable for
Lessor to withhold its consent to an assignment or a subletting if (i) the
proposed use by the transferee is a restaurant use consistent with uses at
first-class retail centers in the greater Dallas area, (ii) the proposed use by
the transferee does not violate any use restrictions or exclusive use rights
then in effect at the Shopping Center, (iii) the proposed use by the transferee
does not compete with another tenant then operating within the Shopping Center
as determined by Lessor acting in a commercially reasonable manner, and (iv) the
proposed assignee or subtenant is then operating at least ten (10) other similar
facilities to the facility proposed to be operated by it in the premises and is
of such financial standing and operational responsibility as to give reasonable
assurance of the payment of all rental and other amounts reserved in this Lease
and compliance with all of the terms, covenants, provisions and conditions of
this Lease. Consent by Lessor to one or more assignments or subletting shall not
operate as a waiver of Lessor's rights as to any subsequent assignments or
subletting.
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Notwithstanding anything to the contrary set forth above, in the event of a
proposed assignment of this Lease or a proposed sublet of more than one-half
(1/2) of the floor area of the premises (other than an assignment or subletting
as permitted below without Lessor's consent being required), then Lessor shall
be entitled to terminate this Lease at any time during the thirty (30) day
period described above by delivering to Lessee written notice thereof, whereupon
this Lease shall terminate and be of no further force or effect on the sixtieth
(60th) day after the delivery of said notice of termination; provided, however,
in the event of such termination and as a condition to the effectiveness of such
termination, Lessor shall pay to Lessee an amount equal to the Unamortized
Costs, such amount to be paid in three (3) equal annual installments, the first
such installment being due and payable one (1) year following such termination,
and the remaining installments at twelve (12) month intervals thereafter. If
Lessor fails to so terminate this Lease, the proposed subletting or assignment
shall remain subject to Lessor's said approval right.
Notwithstanding the foregoing, no consent of Lessor shall be required for the
assignment of this Lease or the subletting of any portion (or the whole) of the
premises to any company now or hereafter affiliated with Lessee (including a
subsidiary, affiliate or controlling corporation then meeting the requirement of
the Securities Act of 1933 as to "control" in all of said instances) or to any
company which may result from a merger or consolidation by or with Lessee, or to
any company to which Lessee is selling all or substantially all of its operating
assets. Any such assignment or subletting shall be subject to the use
restrictions specified in Section 5.1. No such assignment or subletting shall
release Lessee from any of its obligations with respect to this Lease. However,
any such proposed assignee shall, promptly after securing the leasehold estate,
deliver to Lessor an instrument whereby such company assumes all of the
obligations of Lessee named herein.
Notwithstanding any assignment or subletting, except as hereinafter expressly
provided, Lessee shall at all times remain fully responsible and liable for the
payment of rent herein specified and for compliance with all of its other
obligations under this Lease (even if future assignments and subletting occurs
subsequent to the assignment or subletting by Lessee and regardless of whether
or not Lessee's approval has been obtained for such future assignments and
subletting). Moreover, in the event that the rental due and payable by a
sublessee (or a combination of the rental payable under such sublease plus any
bonus or other consideration therefor or incident thereto) other than a
sublessee affiliated to Lessee as set out in the preceding paragraph exceeds the
rental payable under this Lease, or if with respect to a permitted assignment,
permitted license or other transfer by Lessee permitted by Lessor, the
consideration payable to Lessee by the assignee, licensee or other transferee
exceeds the rental payable under this Lease, then Lessor shall have the option
(exercisable within the thirty (30) day period specified in Section 12.2 above)
to require Lessee to pay Lessor all such excess rental and other excess
consideration within ten (10) days following receipt thereof by Lessee from such
sublessee, assignee, licensee or other transferee, as the case may be; provided,
however, if Lessor exercises such option as to any assignment by Lessee as to
which such option is applicable hereunder, Lessee shall be released from
liabilities arising under this Lease after the end of the then current term of
this Lease (whether the initial or a renewal) during which the assignment
occurs. Finally, in the event of an assignment or subletting, it is understood
and agreed that all rentals paid to Lessee by an assignee or sublessee shall be
received by Lessee in trust for Lessor, to be forwarded immediately to Lessor
without offset or reduction of any kind and upon election by Lessor such rentals
shall be paid directly to Lessor (to be applied as a credit and offset to Lessee
rental obligation). Notwithstanding the foregoing, to the extent consideration
received by Lessee in connection with an assignment or subletting represents
payment to Lessee for its equipment or unamortized cost of leasehold
improvements, as fairly and reasonably allocated between such items and the
value of the assignment or subletting, such consideration shall be retained by
Lessee for its own account.
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12.3 ASSUMPTION BY ASSIGNEE. An assignment made with Lessor's consent or as
otherwise permitted shall not be effective until Lessee delivers to Lessor an
executed counterpart of such assignment containing an agreement, in recordable
form, executed by the assignor and the proposed assignee, in which the assignee
assumes the performance of the obligations of the assignor under this Lease.
XIII.
CONSTRUCTION
13.1 RESTAURANT FACILITY. Lessee shall, at Lessee's sole cost, risk and expense,
construct, erect and diligently pursue completion of the restaurant facility on
the premises, including without limitation, the restaurant building (with
drive-through) not to exceed 5,000 square feet, including mechanical and
electrical facilities therein, parking areas, driveways and curbs, sidewalks,
lighting, service area screening around the building paid, signage, landscaping
and all other facilities and improvements on the premises. Lessee's work shall
also include all site work necessary to provide a buildable pad for the building
which is of a compaction which meets generally accepted architectural and
engineering standards and building codes of the City of The Colony, any ground
work necessary to permit the pouring of the foundation of the building, such
work as is necessary to extend utilities from the boundary of the premises, such
work necessary to correct any elevation and soil fill requirements and compact
with correct moisture content, and erosion control as required, all as to be
more particularly described int he plans and specifications. The restaurant
facility shall be constructed in a good and workmanlike manner, subject to
Sections 2.3 and 2.4 of the Declaration and in accordance with plans and
specifications approved by Lessor as hereinafter provided and in accordance with
all applicable laws, regulations, ordinances, rules, standards and guidelines of
any governmental authority having jurisdiction over construction of improvements
on the premises.
13.2 PLANS AND SPECIFICATIONS. Prior to the commencement of construction, Lessor
shall have the right to approve Lessee's plans and specifications for all
improvements and any subsequent alterations to the premises, which approval
shall not be unreasonably withhold. Lessee's plans and specifications shall
include plans and specifications for any buildings or structures to be
constructed on the premises, site plans showing parking areas and driveways and
plans and specifications for any exterior signage and landscaping. Lessee's
plans and specifications will be fashioned similarly to the existing prototype
store at Valley Ranch, with the exception of materials necessary for uniformity
per requirements of the Declaration. If Lessor fails to respond to Lessee's
written request for approval within thirty (30) days after receipt of Lessee's
final construction plans and specifications, Lessor's approval shall be deemed
granted. Lessee shall, when Lessee's work is substantially completed, furnish
Lessor with an accurate "as-built" plan of the improvements as constructed,
initialed by Lessee's architect and/or all contractors and subcontractors
performing the work, which plans shall be incorporated into this Lease by this
reference for all intents and purposes.
13.3 Lessee's Responsibility for All Costs of Performing Lessee's Work. Lessee
shall be responsible, at Lessee's sole cost and expense, for the full cost of
performance of Lessee's work. Lessee shall have no authority, express or
implied, to create or place any lien or encumbrance of any kind or nature
whatsoever upon, or in any manner to bind the interest of Lessor in the premises
or to charge the rentals payable hereunder for any claim in favor of any person
dealing with Lessee, including those who may furnish materials or perform labor
for any construction or repairs. Rather, each such claim shall affect and each
such lien shall attach to, if at all, only the leasehold interest granted to
Lessee by this Lease and shall be inferior and subject to the rights, title and
interests of Lessor. Any right or authority given
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hereunder to Lessee in accordance with any of the provisions of this instrument
to erect or cause to be erected, the buildings and improvements on the premises,
or to make any alterations or repairs to said buildings and improvements, shall
not constitute an express or implied agency in Lessee to bind Lessor's interest
in any way, any relationship between the parties hereto, except that of Lessor
and lessee, being expressly negatived. Lessee covenants and agrees that it will
pay or cause to be paid all sums legally due and payable by it on account of any
labor performed on the premises on which any lien is or can validly and legally
be asserted against its leasehold interest in the premises or the improvements
and that it will save Lessor harmless from any claim, lien, or encumbrance
against the rights, title and interest of Lessor in the premises arising with
respect to Lessee's work.
XIV.
DIRECTION OF TENANTS ENERGIES
14.1 Lessee acknowledges that Lessee's monetary contribution to Lessor (in the
form of rentals) and Lessee's general contribution to commerce within the
Shopping Center (also important in Lessor's determination to execute this Lease
with Lessee) will be substantially reduced if during the term of this Lease,
either Lessee or any person, firm or corporation, directly or indirectly
controlling, controlled by or under common control with Lessee shall directly or
indirectly operate, manage, conduct or have any interest in a competing
restaurant establishment within commercial proximity of the Shopping Center.
Accordingly, Lessee agrees that if during the term of this Lease, either Lessee
or any person, firm or corporation, directly or indirectly controlling,
controlled by or under common control with Lessee (and also, in the event Lessee
is a corporation, if any officer or director thereof or shareholder owning more
than ten percent (10%) of the outstanding stock thereof, or parent, subsidiary
or related or affiliated corporation) either directly or indirectly commences
operation of a Fresh 'N Lite restaurant or any other particular restaurant
operation from time to time conducted in the premises as provided in compliance
with Section 5.1 or Section 12.2 during the period of any such particular
operation, within a straight line radius of one (1) mile of the Shopping Center
which Lessee acknowledges is a reasonable area for the purpose of this
provision, then in such event, the Basic Annual Rental shall be one hundred ten
percent (110%) of the amount stipulated in Section 3.1 of this Lease.
The above adjustment in rental reflects the estimate of the parties as to the
damages which Lessor would be likely to incur by reason of the diversion of
business and customer traffic from the premises and Shopping Center to such
other store within such radius, as a proximate result of the establishment of
such other store. This provision shall not apply to any existing store presently
being operated by Lessee as of the date hereof or to any store existing at the
time of any change of use of the premises under Section 5.1 or Section 12.2,
provided there is no increase in the size, merchandise mix or trade name of such
commercial establishment. Finally, Lessee agrees that Lessor may waive, for any
reason whatsoever, all rights granted to Lessor pursuant to this Section 14.1,
and may sever this section from the remainder of this Lease (thereby keeping the
remainder of this Lease unmodified and in full force and effect).
XV.
MISCELLANEOUS
15.1 INDEPENDENT OBLIGATIONS. Except as may be expressly provided in this Lease,
Lessee shall not for any reason withhold or reduce Lessee's required payments of
rentals and other charges provided in this Lease, it being agreed that the
obligations of Lessor under this Lease are independent of Lessee's obligations
except as may be otherwise expressly provided. The immediately preceding
sentence
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shall not be deemed to deny Lessee the ability of pursuing all rights granted it
under this Lease or at law however, at the direction of Lessor, Lessee's claims
in this regard shall be litigated in proceedings different form any litigation
involving rental claims or other claims by Lessor against Lessee (i.e. each
party may proceed to a separate judgment without consideration, counterclaim or
offset as to the claims asserted by the other party).
15.2 NOTICES. All notices, demands and communications provided herein shall be
served by registered or certified United States mail, available express mail
carrier (such as Federal Express, ▇▇▇▇▇, Airborne, etc.) return receipt
requested or by facsimile (with subsequent mail or express delivery) transmitted
to the following address or number or to such other address(es) or number as
Lessor and Lessee may advise each other in writing.
LESSOR: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Development, Ltd.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
COPY TO: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
LESSEE: Fresh 'n Lite, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
COPY TO: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
15.3 CONSTRUCTION. In an event that any of the provisions of this Lease shall by
court order be held invalid or in contravention of any of the laws of the United
States or of any state barring jurisdiction over the subject matter or of any
dispute arising under it, such invalidation shall not serve to affect the
remaining portion of this Lease. This Lease shall be governed by and construed
in accordance with the laws of the State of Texas.
15.4 SUCCESSORS. This contract shall bind Lessor and Lessee and their
successors, heirs, assigns, administrators, and legal representatives, as the
case may be, except as otherwise herein expressly provided.
15.5 RECORDING. Upon request of either party, the parties shall execute a short
form of this Lease on a written document witnessed and acknowledged in a form
capable of being recorded in the public
154
records of Bexar County, Texas. Lessee shall not record this Lease without prior
written consent of Lessor.
15.6 COUNTERPARTS. This agreement is being executed simultaneously in
counterparts, any one of which shall be deemed an original.
15.7 NO AGENCY. The parties hereto agree that the business relationship created
by this Lease is solely that of Lessor and Lessee. Nothing contained in this
Lease shall make Lessee an agent, legal representative, partner, subsidiary,
joint venturer, or employee of Lessor. Lessee shall have no right or power to,
and shall not bind or obligate Lessor in any way, manner or thing whatsoever,
nor represent that it has any right to do so.
15.8 TIME OF THE ESSENCE. Time shall be of the essence in every part of this
Lease.
15.9 BINDING EFFECT. This agreement shall become immediately binding on the
parties to this Lease on the date the last party signs it, notwithstanding that
the terms of this Lease shall commence upon a future date.
15.10 HEADINGS. The headings of the paragraphs and subparagraphs are inserted
solely for the convenience of reference and shall not constitute a part of this
Lease, nor limit, define or describe the scope or intent of this Lease.
15.11 JOINT AND SEVERAL LIABILITY. If Lessee or Lessor are more than one person,
each individual's liability under this Lease shall be joint and several.
15.12 CONSENTS. In all circumstances under this Lease where the prior consent of
one party (the "consenting party"), whether it be Lessor or Lessee, is required
before the other party (the "requesting party)" is authorized to take any
particular type of action, such consent shall not be withheld in a wholly
unreasonable and arbitrary manner however, the requesting party agrees that its
exclusive remedy if it believes that consent has been withheld improperly shall
be to institute litigation either for a declaratory judgment or for a mandatory
injunction requiring that such consent be given (with the requesting party
hereby waiving any claim for damages, attorneys, attorneys fees or any other
remedy unless the consenting party refuses to comply with the court order or
judgment requiring it to grant its consent).
15.13 LIABILITY OF LESSOR. The liability of Lessor to Lessee for any default
under the terms of this Lease shall be limited to the interest of Lessor in the
premises and Lessor shall not be personally liable for any deficiency. This
clause shall note be deemed to limit or deny any remedies which Lessee may have
in the event of default by Lessor hereunder which do not involve the personal
liability of Lessor.
15.14 DEFINITIONS.
(a) The term "Lessor" as used in this Lease shall mean the owner in fee
of the premises for the time being, or the owner of the leaseholder
estate created by any underlying lease, or mortgagee of the fee or of
such underlying lease in possession for the time being, so that in the
event of any sale or sales of the premises, or of the making of any
such underlying lease and the leasehold estate created by it, the
seller, lessor, transferor or assignor shall be and is hereby
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155
entirely freed and relieved of all agreements, covenants and
obligations of Lessor herein and it shall be deemed and construed
without further agreement between the parties or their successors in
interest or between the parties and the purchase, lessee, transferee or
assignee has assumed and agreed to carry out any and all agreements,
covenants and obligations of Lessor under this Lease.
(b) The term "Lessee" shall mean the Lessee named in this Lease, and
from and after any valid assignment or sublease of Lessee's interest in
this Lease pursuant to its provisions, the assignee or sublease of this
Lease.
(c) The term "building fixture" as used in the Lease means all
equipment used in conjunction with the building, including, without
limitation, heating, ventilating and air conditioning systems, water
heaters or softeners and items of similar nature, but does not include
Lessee's furniture, signage, trade fixtures, unattached kitchen
equipment or other unattached, movable personalty.
(d) The term "Effective Date" shall mean the date of execution of this
Lease by both Lessor and Lessee (i.e., the latest of such dates of
execution as noted below).
(e) The term "Unamortized Cost" shall mean the unamortized hard costs
of the initial construction of Lessee's restaurant building pursuant to
Article XIII hereof (based on twenty-year straight-line depreciation),
and including the cost of any additional improvements installed on the
premises by Lessee (but specifically excluding (i) the cost of any
repair and maintenance items which are typically treated as expenses
for financial accounting purposes, (ii) the cost of Lessee's furniture,
trade fixtures and inventory), and (iii) site improvements costs such
as, but not limited to, parking areas, landscaping and other
improvements outside of the building structure.
15.15 ESTOPPEL CERTIFICATES. Lessee and Lessor each agree within ten (10) days
after written request to execute and deliver to the other estoppel certificates
reasonably requested by Lessor or Lessor's mortgages or Lessee and Lessee's
mortgages as to the status of this Lease, including without limitation whether
any defaults exist, the date to which rental was last paid and similar matters.
15.16 COMMISSIONS. Lessor agrees to pay all commissions due in connection with
the execution of this Lease. Lessee and Lessor represent and warrant to each
other that such party has not had any dealings with any realtor, broker or agent
in connection with this Lease or the negotiation hereof, other than Tricor
International Realty Corp. and ▇▇▇▇ ▇▇▇▇▇▇ of ▇▇▇▇▇▇▇▇ ▇▇▇▇ Company, and each
party agrees to defend, indemnify and hold the other party harmless from any
cost, expense or liability, including reasonable attorney's fees, for any breach
in this representation.
156
The Lessor and Lessee have respectively signed this Lease on the dates indicated
below.
LESSOR:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ DEVELOPMENT, LTD.,
a Texas limited partnership
By:
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
Date:
LESSEE:
FRESH'N LITE, INC.,
a Texas Corporation
By:
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
Date:
SCHEDULE OF EXHIBITS
Exhibit "A" - Legal Description of Land
Exhibit "A-1" "A-2" - Legal Description/Site Plan of Shopping Center
Exhibit "B" - Easements, Conditions and Restrictions
Exhibit "C" - Easements
157
Exhibit "A" GF-Number 97R00830
BEING a tract of land situated in the ▇. ▇▇▇▇▇▇ SURVEY ABSTRACT NO. 1352, ▇▇▇▇▇▇
County, Texas and being a portion of ▇▇▇ ▇, ▇▇▇▇▇ ▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ADDITION, an
addition to the City of The Colony, according to the plat recorded in Cabinet L,
Page 388 of the Plat Records of ▇▇▇▇▇▇ County, Texas (PRDCT) and being more
particularly described as follows:
BEGINNING at a 5/8 inch iron rod found in the northerly right-of-way line of
STATE HIGHWAY 121 (variable width right-of-way), said iron rod being the most
easterly southeast corner of said Lot 3;
THENCE along the northerly right-of-way line of said STATE HIGHWAY 121 and the
southerly line of said ▇▇▇ ▇, ▇▇▇▇▇ ▇▇ degrees 20 minutes 23 seconds West a
distance of 125.00 feet to a 1/2 inch rod set for corner;
THENCE departing the northerly right-of-way line of said STATE HIGHWAY 121 and
the southerly line of said ▇▇▇ ▇, ▇▇▇▇▇ ▇▇ degrees 32 minutes 47 seconds West a
distance of 320.92 feet to an "X" in concrete set in the common line of said ▇▇▇
▇ ▇▇▇ ▇▇▇ ▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇ I;
THENCE along the common line of said ▇▇▇ ▇ ▇▇ ▇▇▇▇ ▇▇▇ ▇ as follows:
North 61 degrees 27 minutes 13 seconds East a distance of 93.00 feet to an "X"
in concrete set for the most southerly southwest corner of LOT 8 of said BLOCK
1;
North 28 degrees 32 minutes 48 seconds West a distance of 140.80 feet to an "X"
in concrete set for the most southerly southwest corner of LOT 8 of said BLOCK
1;
THENCE along the common line of said ▇▇▇ ▇ ▇▇ ▇▇▇▇ ▇▇▇ ▇ ▇▇▇▇▇ ▇▇ degrees 27
minutes 12 seconds East a distance of 32.00 feet to a 1/2 inch iron rod set in
the Easterly line of said BLOCK 1;
THENCE along the easterly line of said LOT 3 and the easterly line of said BLOCK
1, South 28 degrees 32 minutes 47 seconds East a distance of 461.47 feet to the
POINT OF BEGINNING.
CONTAINING within these metes and bounds 1.024 acres or 44,605 square feet of
land more or less.
A - 1
[GRAPH]
d-539341.1
A - 2
[GRAPH]
d-539341.1
A - 3
EXHIBIT "B"
TITLE EXCEPTIONS
1. Restrictive covenants recorded in Volume 2375, page 676 as amended in
Volume 2748, Page 784 and under County Clerk's File no. 93-R0078765 and
in Volume 2418, Page 220 and under Clerk's File Nos. 95-R0077858 and
95-R0077859 of the Deed Records of ▇▇▇▇▇▇ County, Texas.
2. Easement for electric transmission and/or distribution line granted to
Texas Power & Light Company and ▇▇▇▇▇▇ County Electric Cooperative, by
Centex Development Company, by instrument dated 5/4/90, filed 7/25/90,
recorded in Volume 2820, Page 457 of the Deed Records of ▇▇▇▇▇▇ County,
Texas, and as shown on survey prepared by ▇.▇. ▇▇▇▇▇, RPLS No. 4581,
dated 11/14/95.
3. Terms, conditions and stipulations of that certain Easement Agreement
by and between Centex Development Company, L.P., and The City of The
Colony, dated 12/4/95, filed 12/14/95, recorded under Clerk's File No.
95-R0077860 of the Deed Records of ▇▇▇▇▇▇ County, Texas.
4. Terms, conditions and stipulations of that certain Reciprocal Access
Easements Agreement by and between Colony ▇▇▇▇▇ ▇▇▇▇, Ltd., and J&J
Beverage Co., Inc., dated 12/7/95, filed 12/14/95, recorded under
Clerk's File No. 95-R0077857 of the Deed Records of ▇▇▇▇▇▇ County,
Texas.
5. Deed of Trust and Security Agreement dated January 4, 1996 recorded in
Deed Records, ▇▇▇▇▇▇ County, Texas, securing payment of $3,930,000
Promissory Note payable to Bank One, Texas, National Association.
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EXHIBIT "C"
III. EASEMENTS
3.1 Ingress, Egress and Parking: Each Owner, as grantor, hereby grants
to the other Owners, their respective tenants, contractors, employees, agents,
customers, licensees and invitees of such tenants, for the benefit of each
Parcel belonging to the other Owners, as grantees, a nonexclusive easement for
ingress and egress by vehicular and pedestrian traffic and vehicular parking
upon, over and across that portion of the Common Area located on the grantor's
Parcel(s), except for those areas devoted to Service Facilities or drive up or
drive through customer service facilities. The reciprocal rights of ingress and
egress set forth in this Section 3.1 shall apply to the Common Area for each
Parcel as such area shall be increased pursuant to Section 2.2 above.
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