1
Exhibit 10.1
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LEASE AGREEMENT
by and between
▇▇▇▇▇-▇▇▇▇▇▇▇, INC.
(Landlord)
and
CIAO CUCINA CORP.
t/a CIAO CUCINA
(Tenant)
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS AND ATTACHMENTS.............................................................. 1
Section 1.1. Certain Defined Terms.................................................................... 1
Section 1.2. Additional Defined Terms................................................................. 4
Section 1.3. Attachments.............................................................................. 5
ARTICLE II PREMISES................................................................................. 5
Section 2.1. Demise................................................................................... 5
Section 2.2. Measurement of Premises.................................................................. 5
ARTICLE III TERM..................................................................................... 6
Section 3.1. Term..................................................................................... 6
Section 3.2. Termination.............................................................................. 6
Section 3.3. Holding Over............................................................................. 6
ARTICLE IV USE...................................................................................... 7
Section 4.1. Prompt Occupancy and Use................................................................. 7
Section 4.2. Storage and Office Areas................................................................. 7
Section 4.3. Tenant Trade Name........................................................................ 7
Section 4.4. Store Hours.............................................................................. 7
ARTICLE V RENTAL................................................................................... 7
Section 5.1. Rentals Payable.......................................................................... 7
Section 5.2. Annual Basic Rental...................................................................... 8
Section 5.3. Annual Percentage Rental................................................................. 8
Section 5.4. "Rental Year" Defined.................................................................... 8
Section 5.5. "Gross Sales" Defined.................................................................... 8
Section 5.6. Statements of Gross Sales................................................................ 9
Section 5.7. Tenant's Records......................................................................... 10
Section 5.8. Payment of Rental........................................................................ 10
Section 5.9. Advance Rental........................................................................... 11
Section 5.10. Future Expansion........................................................................ 11
ARTICLE VI TAXES.................................................................................... 11
Section 6.1. Tenant to Pay Proportionate Share of Taxes............................................... 11
Section 6.2. Payment of Proportionate Share of Taxes.................................................. 11
Section 6.3. "Tax Year" Defined....................................................................... 12
Section 6.4. Taxes on Rental.......................................................................... 12
ARTICLE VII IMPROVEMENTS............................................................................. 12
Section 7.1. Landlord's Improvements.................................................................. 12
Section 7.2. Tenant's Improvements.................................................................... 13
Section 7.3. "Ready for Occupancy" Defined............................................................ 13
Section 7.4. Effect of Opening for Business........................................................... 14
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Section 7.5. Mechanic's Liens......................................................................... 14
Section 7.6. Tenant's Leasehold Improvements and Trade Fixtures....................................... 15
ARTICLE VIII OPERATIONS............................................................................... 15
Section 8.1. Operations by Tenant..................................................................... 15
Section 8.2. Signs and Advertising.................................................................... 17
Section 8.3. Painting and Displays by Tenant.......................................................... 17
Section 8.4. Trash Removal Service.................................................................... 17
Section 8.5. Permitted Use Disclaimer................................................................. 17
Section 8.6. Hazardous Substances..................................................................... 17
ARTICLE IX REPAIRS AND ALTERATIONS.................................................................. 18
Section 9.1. Repairs to be Made by Landlord........................................................... 18
Section 9.2. Repairs to be Made by Tenant............................................................. 18
Section 9.3. Damage to Premises....................................................................... 19
Section 9.4. Alterations by Tenant.................................................................... 19
Section 9.5. Changes and Additions to Shopping Center................................................. 19
Section 9.6. Roof and Walls........................................................................... 20
ARTICLE X COMMON AREAS............................................................................. 20
Section 10.1. Use of Common Areas..................................................................... 20
Section 10.2. Management and Operation of Common Areas................................................ 20
Section 10.3. Employee Parking Areas.................................................................. 21
Section 10.4. Tenant's Contribution to Landlord's Operating Costs..................................... 21
Section 10.5. Landlord's Operating Costs.............................................................. 21
Section 10.6. Mall Heating Ventilating and Air-Conditioning Equipment
Contribution Rate....................................................................... 22
Section 10.7. Renovation or Expansion of Common Areas................................................. 22
ARTICLE XI MARKETING FUND.......................................................................... 22
Section 11.1. Marketing Fund.......................................................................... 22
Section 11.2. Tenant's Contribution to Marketing Fund................................................. 22
Section 11.3. Landlord's Contribution to Marketing Fund............................................... 23
Section 11.4. "First Fund Year" and "Fund Year" Defined............................................... 23
ARTICLE XII UTILITIES............................................................................... 23
Section 12.1. Water, Electricity, Telephone and Sanitary Sewer........................................ 23
Section 12.2. Heating, Ventilating and Air-Conditioning............................................... 24
Section 12.3. Fire Protection Sprinkler System........................................................ 25
Section 12.4. Discontinuances and Interruptions of Utility Services................................... 25
ARTICLE XIII INDEMNITY AND INSURANCE................................................................. 25
Section 13.1. Indemnities............................................................................. 25
Section 13.2. Landlord Not Responsible for Acts of Others............................................. 26
Section 13.3. Tenant's Insurance...................................................................... 26
Section 13.4. Tenant's Contractor's Insurance......................................................... 27
Section 13.5. Policy Requirements..................................................................... 27
Section 13.6. Increase in Insurance Premiums.......................................................... 27
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Section 13.7. Waiver of Right of Recovery............................................................. 28
Section 13.8. Tenant to Pay Proportionate Share of Insurance Costs.................................... 28
ARTICLE XIV DAMAGE AND DESTRUCTION.................................................................. 29
Section 14.1. Landlord's Obligation to Repair and Reconstruct......................................... 29
Section 14.2. Landlord's Option to Terminate Lease.................................................... 29
Section 14.3. Demolition of Landlord's Building....................................................... 29
Section 14.4. Insurance Proceeds...................................................................... 29
ARTICLE XV CONDEMNATION............................................................................ 30
Section 15.1. Effect of Taking........................................................................ 30
Section 15.2. Condemnation Awards..................................................................... 30
ARTICLE XVI ASSIGNMENTS AND SUBLETTING.............................................................. 30
Section 16.1. Landlord's Consent Required............................................................. 30
Section 16.2. Transfer of Corporate Shares............................................................ 32
Section 16.3. Transfer of Partnership Interests....................................................... 32
Section 16.4. Acceptance of Rent from Transferee...................................................... 33
Section 16.5. Additional Provisions Respecting Transfers.............................................. 33
ARTICLE XVII DEFAULT................................................................................. 33
Section 17.1. "Event of Default" Defined.............................................................. 33
Section 17.2. Remedies................................................................................ 34
Section 17.3. Damages................................................................................. 35
Section 17.4. Remedies in Event of Bankruptcy or Other Proceeding..................................... 37
ARTICLE XVIII SUBORDINATION AND ATTORNMENT............................................................ 39
Section 18.1. Subordination........................................................................... 39
Section 18.2. Mortgagee's Unilateral Subordination.................................................... 40
Section 18.3. Attornment.............................................................................. 40
ARTICLE XIX NOTICES................................................................................. 40
Section 19.1. Sending of Notices...................................................................... 40
Section 19.2. Notice to Mortgagees.................................................................... 41
ARTICLE XX MISCELLANEOUS........................................................................... 41
Section 20.1. Radius Restriction...................................................................... 41
Section 20.2. Estoppel Certificates................................................................... 41
Section 20.3. Inspections and Access by Landlord...................................................... 41
Section 20.4. Memorandum of Lease..................................................................... 41
Section 20.5. Remedies Cumulative..................................................................... 42
Section 20.6. Successors and Assigns.................................................................. 42
Section 20.7. Compliance with Laws and Regulations.................................................... 42
Section 20.8. Captions and Headings................................................................... 42
Section 20.9. Joint and Several Liability............................................................. 42
Section 20.10. Broker's Commission..................................................................... 43
Section 20.11. No Discrimination....................................................................... 43
Section 20.12. No Joint Venture........................................................................ 43
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Section 20.13. No Option............................................................................... 43
Section 20.14. No Modification......................................................................... 43
Section 20.15. Severability............................................................................ 44
Section 20.16. Third Party Beneficiary................................................................. 44
Section 20.17. Corporate Tenants....................................................................... 44
Section 20.18. Applicable Law.......................................................................... 44
Section 20.19. Performance of Landlord's Obligations by Mortgagee...................................... 44
Section 20.20. Waiver of Certain Rights................................................................ 44
Section 20.21. Limitation on Right of Recovery Against Landlord........................................ 45
Section 20.22. Survival................................................................................ 45
Section 20.23. Relocation of Premises.................................................................. 45
Section 20.24. Landlord's Option to Terminate Lease.................................................... 47
Section 20.25. Financing Contingency................................................................... 47
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NOTICE OF LEASE MODIFICATIONS
-----------------------------
Please be advised that those Sections of the Lease between ▇▇▇▇▇-▇▇▇▇▇▇▇, INC.
and CIAO CUCINA CORP. listed below have been modified and/or supplemented by the
Rider to Lease found immediately following the signature page of the Lease. It
is therefore imperative that the Lease and Rider be read simultaneously.
Wherever there is any conflict between the Rider and the Lease, the provisions
of the Rider are paramount and the Lease shall be construed accordingly.
Section 1.1.
Section 3.2.
Section 4.3.
Section 4.4.
Section 5.1.
Section 5.3.
Section 5.5.
Section 5.6.
Section 5.9.
Section 5.10.
Section 6.1.
Section 7.2.
Section 8.2.
Section 9.4.
Section 9.5.
Section 10.6.
Section 10.7.
Section 11.5.
Section 13.3.
Section 13.8.
Section 14.1.
Section 14.2.
Section 16.2.
Section 17.1.
Section 20.2.
Section 20.10.
Section 20.21.
Section 20.23.
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LEASE AGREEMENT
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THIS LEASE AGREEMENT ("Lease") dated July 7, 1997
by and between ▇▇▇▇▇-▇▇▇▇▇▇▇, INC., a Maryland corporation ("Landlord"), and
CIAO CUCINA CORP., an Ohio corporation, t/a CIAO CUCINA, ("Tenant").
W I T N E S S E T H:
THAT FOR AND IN CONSIDERATION of the sum of One Dollar ($1.00) and the
mutual covenants herein contained, the parties hereto do hereby covenant and
agree as follows:
ARTICLE I
DEFINITIONS AND ATTACHMENTS
---------------------------
Section 1.1. Certain Defined Terms.
----------------------
As used herein, the term:
A. "Shopping Center Area" means those certain parcels of land
owned, leased or controlled by Landlord situate in the City of
Oviedo, County of Seminole, State of Florida, more
particularly described in Schedule "A-1", and upon, the
opening for business with the public, any such property used
for expansion or addition.
B. "Shopping Center" means the Shopping Center Area and the
adjacent parcel or parcels of land not owned, leased or
controlled by Landlord but which are operated as an integral
part of the shopping center known as The Oviedo Marketplace as
more particularly described in Schedule A-2 and, upon the
opening for business with the public, any such property used
for expansion or addition.
C. "Landlord's Building" means the structure or portions of a
structure constructed or improved or to be constructed or
improved by Landlord in the Shopping Center Area intended to
be leased to retail tenants in the location shown on Schedule
A, as the same may be altered, reduced, expanded or replaced
from time to time.
"Grand Opening Date" means the date and time designated by
Landlord as the grand opening date of Landlord's Building.
D. "Premises" means Tenant's portion of Landlord's Building shown
on Schedule A having the following approximate dimensions:
Width: ________________________
Depth: ________________________
Floor Area: 6,500 square feet
The actual dimensions of the Premises shall be determined by
measurement pursuant to the provisions of Section 2.2.
E. "Term" means a period of fifteen (15) years plus the part of a
month mentioned in Section 3.1., commencing and ending as
provided in Section 3.1.
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F. "Permitted Use" means the operation of a full service
restaurant offering Italian/Mediterranean menu items
substantially similar to the items set forth on the attached
menu. Tenant shall also be permitted to offer menu items for
off-premises consumption and display dessert and bakery items
in an area not to exceed 1,000 square feet. Tenant agrees, at
its sole cost and expense, to secure and keep in full force
and effect during the Term of this Lease all permits and
licenses required for the sale of alcohol from the appropriate
government agencies. Tenant's failure to secure and keep such
permits and licenses in full force and effect shall not
relieve Tenant of its obligation to operate its business at
the Premises in accordance with the provisions of this Lease.
G. "Annual Basic Rental" means an amount equal to the product of
the following applicable figure multiplied by Tenant's Floor
Area (subject to adjustment as provided in Section 5.1.):
Rental Years 1 - 2: $20.00
Rental Years 3 - 12: $30.00
Rental Years 13 - 15: $35.00
H. "Annual Percentage Rental" means a sum equal to six percent
(6%) of the amount by which annual Gross Sales exceed the
product of the following applicable figure multiplied by
Tenant's Floor Area (the "Breakpoint"), subject to adjustment
as provided in Section 5.1.; provided, however, that in the
event during the first or last Rental Year Tenant is not open
for business for twelve (12) full months, the Breakpoint shall
be an amount equal to the Breakpoint specified herein
multiplied by a fraction, the numerator of which shall be the
actual number of complete months during which Tenant was open
for business during the Rental Year and the denominator of
which shall be twelve (12):
Rental Years 1 - 2: $333.33
Rental Years 3 - 12: $500.00
Rental Years 13 - 15: $583.33
I. "Advance Rental" means the sum of $0.00. See Section 5.9.
J. "HVAC Equipment Contribution Rate" means the sum of $0.00. See
Schedule F.
K. Intentionally deleted.
L. "Marketing Fund Contribution Rate" means the sum of $0.00. See
Article XI. "Opening Contribution Rate" means the sum of
$0.00. See Article XI
M. "Sprinkler Contribution Rate" means the sum of $.20. See
Section 12.3.
N. "Trash Removal Service". See Section 8.4.
O. Intentionally deleted.
P. "Tenant Notice Address" means
Ciao Cucina Corp.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
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Q. "Tenant Trade Name" means CIAO CUCINA which Tenant represents
it is entitled to use pursuant to all applicable laws.
R. "Store Hours" means 11:30 A.M. through 9:30 P.M. Monday
through Saturday, 11:30 A.M. through 8:00 P.M. Sunday.
S. "Restriction Area" means that geographic area within a radius
of ten (10) miles measured from the Premises.
T. "Landlord's Floor Area" means the aggregate number of square
feet of Landlord's leasable floor area in Landlord's Building
(exclusive of Anchor Stores and exclusive of any building not
structurally connected to the enclosed mall or not having an
opening into the enclosed mall) which, with respect to any
such floor area which has been leased to any rent-paying
tenant, shall be determined in accordance with the provisions
of any lease applicable thereto and which, with respect to any
such floor area not so leased, shall consist of all such
leasable floor area in Landlord's Building designed for the
exclusive use and occupancy of rent-paying tenants, which
shall exclude Common Areas, storage areas leased separately
from retail areas, mezzanine areas and areas used for
Landlord's management and promotion offices.
"Landlord's Qualifying Floor Area" means Landlord's Floor Area
less the floor area contained in such tenant's or tenants'
premises as are designated from time to time by Landlord. For
purposes of this Section, and calculation of Tenant's share of
certain costs and expenses as provided in this Lease, the
number of square feet contained in Landlord's Qualifying Floor
Area may therefore be less than the number of square feet in
Landlord's Floor Area.
U. "Tenant's Floor Area" means the number of square feet
contained in that portion of Landlord's Floor Area
constituting the Premises which shall be measured (a) with
respect to the front and rear width thereof, from the exterior
face of the adjacent exterior or corridor wall or, if none,
from the center of the demising partition, to the opposite
exterior face of the adjacent exterior or corridor wall, or if
none, to the center of the opposite demising partition, and
(b) with respect to the depth thereof, from the front lease
line (as designated on the Lease Outline Drawings to be
prepared by Landlord pursuant to Schedule B hereof with
respect to the Premises, or pursuant to other leases, with
respect to premises other than the Premises) to the exterior
face of the rear exterior wall or corridor wall, or, if
neither, to the center of the rear demising partition; and in
no case shall there be any deduction for columns or other
structural elements within any tenant's premises.
V. "Common Areas" means those areas and facilities which may be
furnished by Landlord or others in or near the Shopping Center
Area for the non-exclusive general common use of tenants,
Anchor Stores and other occupants of the Shopping Center,
their officers, agents, employees and customers, including
(without limitation) parking areas, access areas (other than
public streets), employee parking areas, truckways, driveways,
loading docks and areas, delivery passageways, package pick-up
stations, sidewalks, interior and exterior pedestrian walkways
and pedestrian bridges, malls, promenades, mezzanines, roofs,
sprinklers, plazas, courts, ramps, common seating areas,
landscaped and planted areas, retaining walls, balconies,
stairways, escalators, elevators, bus stops, first-aid
stations, sewage treatment facilities (if any) lighting
facilities, comfort stations or rest rooms, civic center,
meeting rooms, and other similar areas, facilities or
improvements.
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W. "Default Rate" means an annual rate of interest equal to the
lesser of (i) the maximum rate of interest for which Tenant
may lawfully contract in the State in which the Shopping
Center is located, or (ii) eighteen percent (18%).
X. "Anchor Store" means any department or specialty store which
either (i) occupies a floor area in excess of 50,000 square
feet in the Shopping Center, or (ii) is designated an Anchor
Store in a notice to that effect given by Landlord to Tenant.
Y. "Tenant Operating Costs Contribution Rate" means the sum of
$5.00. See Section 10.4.
Section 1.2. Additional Defined Terms.
-------------------------
The following additional terms are defined in the places in this Lease
noted below:
The following additional terms are defined in the Sections in
this Lease noted below:
Term Section
---- -------
"Additional Rental" 5.1
"Annual Marketing Fund Contribution" 11.2
"Association" 11.1
"Association Year" 11.4
"Casualty" 14.1
"Commencement Date" 3.1
"Consumer Price Index" 11.2
"Event of Default" 17.1
"Expansion Opening Contribution" 11.2
"First Association Year" 11.4
"Gross Sales" 5.5
"Hazardous Substance" 8.6
"Landlord's Operating Costs" 10.5
"Liquidated Damages" 17.3
"Marketing Fund" 11.1
"Mortgage" 18.2
"Mortgagee" 18.2
"Opening Contribution" 11.2
"Ready for Occupancy" 7.3
"Release" 8.6
"Rental" 5.1
"Rental Year" 5.4
"Taxes" 6.1
"Tax Year" 6.3
"Term" 3.1
"Termination Damages" 17.3
"Termination Date" 3.2
Section 1.3. Attachments.
------------
The following documents are attached hereto, and such documents, as
well as all drawings and documents prepared pursuant thereto, shall be deemed to
be a part hereof:
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Schedule "A" - Drawing of Shopping Center and Landlord's
Building
Schedule "A-1" - Legal Description of Shopping Center Area
Schedule "A-2" - Legal Description of Shopping Center
Schedule "B" - Description of Landlord's Work and Tenant's Work
Schedule "C" - Design Criteria for Tenant Improvements
Schedule "D" - Form of Estoppel Certificate
Schedule "E" - Utility Consumption and Payment Schedule
Schedule "F" - Tenant Heating, Ventilating and Air-Conditioning
Schedule
Schedule "H" - Radon Gas
ARTICLE II
PREMISES
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Section 2.1. Demise.
-------
Landlord hereby leases to Tenant, and Tenant hereby rents from
Landlord, the Premises for the Term and at the Rental hereinafter described.
Landlord warrants that it and no other person or corporation has the
right to lease the Premises hereby demised, and that so long as Tenant is not in
default hereunder, Tenant shall have peaceful and quiet use and possession of
the Premises, subject to any Mortgage, and all matters of record or other
agreements to which this Lease is or may hereafter be subordinated.
Section 2.2. Measurement of Premises.
------------------------
Not later than one hundred twenty (120) days after the commencement of
the Term, or within a reasonable time thereafter, Landlord shall measure the
Premises in the manner provided for in Section 1.1.U. and shall give Tenant
notice of the floor area so determined. The floor area stated in such notice
shall be deemed to be Tenant's Floor Area for all purposes of this Lease unless,
within ten (10) days after receipt of such notice, Tenant shall give Landlord
notice that Tenant believes Landlord's measurement to be inaccurate and the
reasons therefor, in which event Landlord shall cause its architect or engineer
to make such measurement and certify the same to the parties. Tenant's Floor
Area so certified shall be binding on the parties and shall be deemed to be
Tenant's Floor Area for all purposes of this Lease.
ARTICLE III
TERM
----
Section 3.1. Term.
-----
The Term shall commence on the earlier to occur of (a) the first day on
which the Premises are "Ready for Occupancy" (as defined in Section 7.3.), or
(b) Tenant's opening of its business in the Premises (the "Commencement Date"),
and shall be for the number of years and months set forth in Section 1.1.E.,
plus the part of a month, if any, from the Commencement Date through the last
day of the month immediately prior to the first full calendar month in the Term.
Landlord and Tenant agree, upon demand of the other, to execute a declaration
setting forth the Commencement Date and Termination Date as soon as the
Commencement Date has been determined.
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Section 3.2. Termination.
------------
This Lease shall terminate at the end of the Term (the "Termination
Date") without the necessity of any notice from either Landlord or Tenant to
terminate the same, and Tenant hereby waives notice to vacate or quit the
Premises and agrees that Landlord shall be entitled to the benefit of all
provisions of law respecting the summary recovery of possession of the Premises
from a tenant holding over to the same extent as if statutory notice had been
given. Tenant hereby agrees that if it fails to surrender the Premises at the
end of the Term, or any renewal thereof, Tenant will be liable to Landlord for
any and all damages which Landlord shall suffer by reason thereof, and Tenant
will indemnify Landlord against all claims and demands made by any succeeding
tenants against Landlord, founded upon delay by Landlord in delivering
possession of the Premises to such succeeding tenant. For the period of three
(3) months prior to the expiration of the Term, Landlord shall have the right to
display on the exterior of the Premises a "For Rent" sign (not to exceed one
foot by one foot in size) and during such period Landlord may show the Premises
and all parts thereof to prospective tenants during normal business hours.
Section 3.3. Holding Over.
-------------
If Tenant shall be in possession of the Premises after the expiration
of the Term, in the absence of any agreement extending the Term, the tenancy
under this Lease shall become one from month to month terminable by either party
on thirty (30) days' prior notice and shall be subject to all of the terms and
conditions of this Lease as though the Term had been extended from month to
month, except that (i) the Annual Basic Rental payable hereunder for each month
during said holdover period shall be equal to twice the monthly installment of
Annual Basic Rental payable during the last month of the Term, (ii) the
installments of Annual Percentage Rental payable hereunder for each such month
shall be equal to one-twelfth (1/12th) of the average Annual Percentage Rental
payable hereunder for the last three (3) Rental Years of the Term, or if the
Term is less than three (3) Rental Years, then such installments shall be equal
to one-twelfth (1/12th) of the Annual Percentage Rental payable hereunder for
the last complete Rental Year preceding expiration of the Term, and (iii) all
Additional Rental payable hereunder shall be prorated for each month during such
holdover period.
ARTICLE IV
USE
---
Section 4.1. Prompt Occupancy and Use.
-------------------------
Tenant shall occupy the Premises upon commencement of the Term and
thereafter will continuously use the Premises for the Permitted Use and for no
other purpose whatsoever; provided that, if the Premises are Ready for Occupancy
prior to the Grand Opening Date, Landlord may require Tenant to defer its
opening for business until the Grand Opening Date, in which event Tenant shall
not be required to pay any Rental until it is permitted to open for business.
Section 4.2. Storage and Office Areas.
-------------------------
Tenant shall use only such minor portions of the Premises for storage
and office purposes as are reasonably required therefor.
Section 4.3. Tenant Trade Name.
------------------
Unless otherwise approved by Landlord, Tenant shall conduct business in
the Premises only in the Tenant Trade Name.
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Section 4.4. Store Hours.
------------
Tenant shall cause its business to be conducted and operated in good
faith and in such manner as shall assure the transaction of a maximum volume of
business in and at the Premises. Tenant covenants and agrees that the Premises
shall remain open for business at least during the Store Hours or such other
hours as shall be seasonally adjusted by Landlord. If Tenant shall fail to cause
its business to be operated during the hours required by the preceding sentence,
or as otherwise required by Landlord, in addition to any other remedy available
to Landlord under this Lease, Tenant shall pay to Landlord, as liquidated
damages for such breach, a sum equal to One Hundred Dollars ($100.00) for each
hour or portion thereof during which Tenant shall fail to so operate.
If Tenant shall request Landlord's approval of the opening of the
Premises for business for periods exceeding those designated above and Landlord
shall approve such request, Tenant shall pay for any additional costs incurred
by Landlord in connection with Tenant's opening the Premises for business during
such additional hours, including but not limited to, a proportionate share of
any additional amounts of Landlord's Operating Costs, additional costs of
heating, ventilating and air-conditioning the Premises, and additional utilities
furnished to the Premises by Landlord.
ARTICLE V
RENTAL
------
Section 5.1. Rentals Payable.
----------------
Tenant covenants and agrees to pay to Landlord as rental ("Rental") for
the Premises, the following:
(a) the Annual Basic Rental specified in clause G of Section 1.1.;
plus
(b) the Annual Percentage Rental specified in clause H of Section
1.1.; plus
(c) all additional sums, charges or amounts of whatever nature to
be paid by Tenant to Landlord in accordance with the
provisions of this Lease, whether or not such sums, charges or
amounts are referred to as additional rental (collectively
referred to as "Additional Rental");
provided, however, that the Annual Basic Rental and the minimum amount of Gross
Sales utilized in the computation of Annual Percentage Rental shall be adjusted
proportionately for any Rental Year of more or less than twelve (12) calendar
months.
Section 5.2. Annual Basic Rental.
--------------------
Annual Basic Rental shall be payable in equal monthly installments in
advance on the first day of each full calendar month during the Term, the first
such payment to also include any prorated Annual Basic Rental for the period
from the date of the commencement of the Term to the first day of the first full
calendar month in the Term.
Section 5.3. Annual Percentage Rental.
-------------------------
Annual Percentage Rental shall be determined and payable monthly on or
before the fifteenth (15th) day following the close of each full calendar month
during the Term, based on Gross Sales for the preceding calendar month. Monthly
payments of Annual Percentage Rental shall be calculated by (a) dividing the
product specified in clause H of Section 1.1. by twelve (12),
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(b) subtracting the quotient thus obtained from the amount of Gross Sales for
the month in question, and (c) multiplying the difference thus obtained (if
greater than zero) by the percentage specified in clause H of Section 1.1. The
first monthly payment of Annual Percentage Rental due hereunder shall include
prorated Annual Percentage Rental based on Gross Sales from the Commencement
Date through the last day of the month immediately prior to the first full
calendar month in the Term. As soon as practicable after the end of each Rental
Year, the Annual Percentage Rental paid or payable for such Rental Year shall be
adjusted between Landlord and Tenant, and each party hereby agrees to pay to the
other, on demand, the amount of any excess or deficiency in Annual Percentage
Rental paid by Tenant to Landlord during the preceding Rental Year as may be
necessary to effect adjustment to the agreed Annual Percentage Rental.
Section 5.4. "Rental Year" Defined.
----------------------
The first "Rental Year" shall commence on the first day of the Term and
shall end at the close of the twelfth full calendar month following the
commencement of the Term; thereafter, each Rental Year shall consist of
successive periods of twelve calendar months. Any portion of the Term remaining
at the end of the last full Rental Year shall constitute the final Rental Year
and Rental shall be apportioned therefor.
Section 5.5. "Gross Sales" Defined.
----------------------
"Gross Sales" means the actual sales prices or rentals of all goods,
wares and merchandise sold, leased, licensed or delivered and the actual charges
for all services performed by Tenant or by any subtenant, licensee or
concessionaire in, at, from, or arising out of the use of the Premises, whether
for wholesale, retail, cash, credit, trade-in or otherwise, without reserve or
deduction for inability or failure to collect. Gross Sales shall include,
without limitation, sales and services (a) where the orders therefor originate
in, at, from, or arising out of the use of the Premises, whether delivery or
performance is made from the Premises or from some other place, (b) made or
performed by mail, telephone, or telegraph orders, (c) made or performed by
means of mechanical or other vending devices in the Premises, or (d) which
Tenant or any subtenant, licensee, concessionaire or other person in the normal
and customary course of its business would credit or attribute to its operations
in any part of the Premises. Any deposit not refunded shall be included in Gross
Sales. Each installment or credit sale shall be treated as a sale for the full
price in the month during which such sale is made, regardless of whether or when
Tenant receives payment therefor. No franchise, occupancy or capital stock tax
and no income or similar tax based on income or profits shall be deducted from
Gross Sales.
The following shall not be included in Gross Sales: (i) any exchange of
merchandise between stores of Tenant where such exchange is made solely for the
convenient operation of Tenant's business and not for the purpose of
consummating a sale made in, at or from the Premises, or for the purpose of
depriving Landlord of the benefit of a sale which would otherwise be made in or
at the Premises, (ii) returns to shippers or manufacturers, (iii) cash or credit
refunds to customers on transactions (not to exceed the actual selling price of
the item returned) otherwise included in Gross Sales, (iv) sales of trade
fixtures, machinery and equipment after use thereof in the conduct of Tenant's
business, (v) amounts collected and paid by Tenant to any government for any
sales or excise tax, and (vi) the amount of any discount on sales to employees.
Section 5.6. Statements of Gross Sales.
--------------------------
Tenant shall deliver to Landlord: (a) within ten (10) days after the
close of each calendar month of the Term, a written report signed by Tenant or
by an authorized officer or agent of Tenant, showing the Gross Sales made in the
preceding calendar month and (b) within sixty (60) days after the close of each
Rental Year a statement of Gross Sales for the preceding Rental Year which shall
conform to and be in accordance with generally accepted accounting principles
and Section 5.5. The annual statement shall be accompanied by the signed
certificate of an
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15
independent Certified Public Accountant stating specifically that (i) he has
examined the report of Gross Sales for the preceding Rental Year, (ii) his
examination included such tests of Tenant's books and records as he considered
necessary or appropriate under the circumstances, (iii) such report presents
fairly the Gross Sales of the preceding Rental Year, and (iv) the Gross Sales
conform with and are computed in compliance with the definition of Gross Sales
contained in Section 5.5. hereof. If Tenant shall fail to deliver such annual
statement and certificate to Landlord within said sixty (60) day period,
Landlord shall have the right thereafter to employ an independent Certified
Public Accountant to examine such books and records, including without
limitation all records required by Section 5.7., as may be necessary to certify
the amount of Tenant's Gross Sales for such Rental Year, and Tenant shall pay to
Landlord the cost thereof as Additional Rental.
If such audit shall disclose that Tenant's records, in the opinion of
such independent Certified Public Accountant, are inadequate to disclose such
Gross Sales, Landlord shall be entitled to collect, as Additional Rental, an
equitable sum determined by such independent Certified Public Accountant but not
exceeding fifty percent (50%) of the Annual Basic Rental payable by Tenant
during the period in question.
Section 5.7. Tenant's Records.
-----------------
For the purpose of permitting verification by Landlord of any amounts
due as Rental, Tenant will (i) cause the business upon the Premises to be
operated so that a duplicate sales slip, invoice or non-resettable cash register
receipt, serially numbered, or such other device for recording sales as Landlord
approves, shall be issued with each sale or transaction, whether for cash,
credit or exchange, and (ii) preserve for at least three (3) years, and during
the Term shall keep at the Tenant Notice Address or the Premises, a general
ledger, required receipts and disbursement journals and such sales records and
other supporting documentation, together with original or duplicate books and
records, which shall disclose all information required to determine Tenant's
Gross Sales and which shall conform to and be in accordance with generally
accepted accounting principles. At any time or from time to time after advance
notice to Tenant, Landlord or any Mortgagee, their agents and accountants, shall
have the right during business hours to make any examination or audit of such
books and records which Landlord or such Mortgagee may desire. If such audit
shall disclose a liability in any Rental Year for Rental in excess of the Rental
theretofore paid by Tenant for such period, Tenant shall promptly pay such
liability. Should any such liability for Rental equal or exceed three percent
(3%) of Annual Percentage Rental previously paid for such Rental Year, or if
such audit shall disclose that Tenant has underreported Gross Sales by five
percent (5%) or more during any Rental Year, (a) Tenant shall promptly pay the
cost of audit and interest at the Default Rate on all additional Annual
Percentage Rental then payable, accounting from the date such additional Annual
Percentage Rental was due and payable, and (b) an Event of Default shall be
deemed to exist unless, within ten (10) days after Landlord shall have given
Tenant notice of such liability, Tenant shall furnish Landlord with evidence
satisfactorily demonstrating to Landlord that such liability for additional
Annual Percentage Rental was the result of good faith error on Tenant's part. If
such audit shall disclose that Tenant's records, in Landlord's opinion, are
inadequate to accurately reflect Tenant's Gross Sales, Landlord shall have the
right to retain a consultant to prepare and establish a proper recording system
for the determination of Tenant's Gross Sales and Tenant agrees that it shall
use the system, books and records prescribed by such consultant for such
purpose. Tenant shall pay to Landlord, as Additional Rental, the fees and
expenses of such consultant.
Section 5.8. Payment of Rental.
------------------
Tenant shall pay all Rental when due and payable, without any setoff,
deduction or prior demand therefor whatsoever. Except as provided herein, Tenant
shall not pay any Rental earlier than one (1) month in advance of the date on
which it is due. If Tenant shall fail to pay any Rental within seven (7) days
after the same is due, Tenant shall be obligated to pay a late
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payment charge equal to the greater of One Hundred Dollars ($100.00) or ten
percent (10%) of any Rental payment not paid when due to reimburse Landlord for
its additional administrative costs. In addition, any Rental which is not paid
within seven (7) days after the same is due shall bear interest at the Default
Rate from the first day due until paid. Any Additional Rental which shall become
due shall be payable, unless otherwise provided herein, with the next
installment of Annual Basic Rental. Rental and statements required of Tenant
shall be paid and delivered to Landlord at the management office of Landlord in
the Shopping Center Area during normal business hours, or at such other place as
Landlord may from time to time designate in a notice to Tenant. Any payment by
Tenant or acceptance by Landlord of a lesser amount than shall be due from
Tenant to Landlord shall be treated as a payment on account. The acceptance by
Landlord of a check for a lesser amount with an endorsement or statement
thereon, or upon any letter accompanying such check, that such lesser amount is
payment in full, shall be given no effect, and Landlord may accept such check
without prejudice to any other rights or remedies which Landlord may have
against Tenant.
Section 5.9. Advance Rental.
---------------
Upon execution of this Lease by Tenant, Tenant shall pay to Landlord
the Advance Rental, the same to be held as security for the performance by
Tenant of all obligations imposed under this Lease which Tenant is required to
perform prior to the commencement of the Term. If Tenant shall faithfully
perform all such obligations, then the Advance Rental shall be applied, pro
tanto, by Landlord against the Rental first becoming due hereunder. Otherwise,
Landlord shall be entitled to apply the Advance Rental, pro tanto, against any
damages which it may sustain by reason of Tenant's failure to perform its
obligations under this Lease, but such application shall not preclude Landlord
from recovering greater damages if the same can be established.
Section 5.10. Future Expansion.
-----------------
In the event that during the Term (i) additional Anchor Stores are
constructed in the Shopping Center, or (ii) one or more expansions of Landlord's
Building, each involving the addition of at least 50,000 square feet of
Landlord's Floor Area, are constructed, then, upon the opening for business of
each such additional Anchor Store or expansion of Landlord's Building, the
Annual Basic Rental shall be increased by ten percent (10%) for each such Anchor
Store or expansion opening and the Breakpoint shall be increased by a like
percentage.
ARTICLE VI
TAXES
-----
Section 6.1. Tenant to Pay Proportionate Share of Taxes.
-------------------------------------------
Tenant shall pay in each Tax Year during the Term, as Additional
Rental, a proportionate share of all amounts payable by Landlord with respect to
real estate taxes, ad valorem taxes and assessments, general and special, taxes
on real estate rental receipts, taxes on Landlord's gross receipts, or any other
tax imposed upon or levied against real estate, or upon owners of real estate as
such rather than persons generally, extraordinary as well as ordinary,
foreseeable and unforeseeable, including taxes imposed on leasehold improvements
which are assessed against Landlord, payable with respect to or allocable to the
Shopping Center Area, including all land, Landlord's Building and all other
buildings and improvements situated thereon, together with the reasonable cost
(including fees of attorneys, consultants and appraisers) of any negotiation,
contest or appeal pursued by Landlord in an effort to reduce any such tax,
assessment or charge, and all of Landlord's reasonable administrative costs in
relation to the foregoing, all of the above being collectively referred to
herein as "Taxes". Tenant's proportionate share of Taxes shall be computed by
multiplying the amount of such Taxes (less any contributions by Anchor Stores)
by a fraction, the numerator of which shall be Tenant's Floor Area and the
denominator of which shall be
-▇▇-
▇▇
▇▇▇▇▇▇▇▇'▇ ▇▇▇▇▇ ▇▇▇▇. For the Tax Year in which the Term commences or
terminates, the provisions of this Section shall apply, but Tenant's liability
for its proportionate share of any Taxes for such year shall be subject to a pro
rata adjustment based upon the number of days of such Tax Year falling within
the Term.
Section 6.2. Payment of Proportionate Share of Taxes.
----------------------------------------
Tenant's proportionate share of Taxes shall be paid by Tenant in
monthly installments in such amounts as are estimated and billed for each Tax
Year during the Term by Landlord, each such installment being due on the first
day of each calendar month. At any time during a Tax Year, Landlord may
reestimate Tenant's proportionate share of Taxes and thereafter adjust Tenant's
monthly installments payable during the Tax Year to reflect more accurately
Tenant's proportionate share of Taxes. Within one hundred twenty (120) days
after Landlord's receipt of tax bills for each Tax Year, or such reasonable (in
Landlord's determination) time thereafter, Landlord will notify Tenant of the
amount of Taxes for the Tax Year in question and the amount of Tenant's
proportionate share thereof. Any overpayment or deficiency in Tenant's payment
of its proportionate share of Taxes for each Tax Year shall be adjusted between
Landlord and Tenant, and Landlord and Tenant hereby agree that Tenant shall pay
Landlord or Landlord shall credit to Tenant's account (or, if such adjustment is
at the end of the Term, Landlord shall pay Tenant), as the case may be, within
fifteen (15) days of the aforesaid notice to Tenant, such amounts as may be
necessary to effect such adjustment. Failure of Landlord to provide such notice
within the time prescribed shall not relieve Tenant of its obligations
hereunder. Notwithstanding the foregoing, if Landlord is required under law to
pay Taxes in advance, Tenant agrees to pay Landlord, upon commencement of the
Term of this Lease, an amount equal to Tenant's share of Taxes for the entire
Tax Year in which the Term of this Lease commences, and in such event, at the
termination of this Lease, Tenant shall be entitled to a refund of Taxes paid
which are attributable to a period after this Lease expires.
Section 6.3. "Tax Year" Defined.
-------------------
The term "Tax Year" means each twelve (12) month period (deemed, for
the purpose of this Section, to have 365 days) established as the real estate
tax year by the taxing authorities having lawful jurisdiction over the Shopping
Center Area.
Section 6.4. Taxes on Rental.
----------------
In addition to Tenant's proportionate share of Taxes, Tenant shall pay
to the appropriate agency any sales, excise and other taxes (not including,
however, Landlord's income taxes) levied, imposed or assessed by the State in
which the Shopping Center is situate or any political subdivision thereof or
other taxing authority upon any Rental payable hereunder. Tenant shall also pay,
prior to the time the same shall become delinquent or payable with penalty, all
taxes imposed on its inventory, furniture, trade fixtures, apparatus, equipment,
leasehold improvements installed by Tenant or by Landlord on behalf of Tenant
(except to the extent such leasehold improvements shall be covered by Taxes
referred to in Section 6.1.), and any other property of Tenant. Landlord may
require that Tenant's leasehold improvements be separately assessed by the
taxing authority.
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ARTICLE VII
IMPROVEMENTS
------------
Section 7.1. Landlord's Improvements.
------------------------
Subject to the provisions of Section 20.24. hereof, and subject to
delays due to labor disputes, Acts of God or the public enemy, governmental
regulations or controls, Casualty or other conditions or causes beyond its
reasonable control, Landlord will, as promptly as possible, let contracts for
the construction of the improvements in or about Landlord's Building which it is
to construct or improve, as more particularly described in Schedule B.
Section 7.2. Tenant's Improvements.
----------------------
Prior to the commencement of the Term, Tenant shall, at its sole cost
and expense, (a) promptly initiate and diligently pursue the design of all
improvements and other work to be performed by it pursuant to Schedule B on a
schedule which in Landlord's reasonable judgment will permit Tenant to complete
such improvements not later than ten (10) days prior to the Grand Opening Date
with respect to the exterior of the Premises and not later than seven (7) days
prior to the Grand Opening Date with respect to the interior of the Premises,
and (b) promptly commence and diligently pursue the construction and completion
of the Premises. Tenant will be permitted by Landlord to enter the Premises in
accordance with Schedule B for the purpose of performing its obligations under
Schedule B and for the purpose of installing its fixtures and other equipment,
provided (a) Tenant shall have obtained Landlord's approval of the plans and
specifications for such work, (b) Tenant shall have obtained a valid building
permit for construction of its improvements, (c) Tenant shall have deposited
with Landlord the policies or certificates of insurance required in Sections
13.3. and 13.4., and (d) Landlord shall have received full payment from Tenant
for the Opening Contribution and for those items set forth in Section D of
Schedule B. Tenant's activities shall be conducted so as not to unreasonably
interfere with Landlord's construction activities. Tenant shall maintain the
Premises in a clean and orderly condition during construction and merchandising.
All trash which may accumulate in connection with Tenant's construction
activities shall be deposited daily in dumpsters, provided by or for Landlord in
the Shopping Center Area as more particularly described in Sections C and D of
Schedule B. All trash which may accumulate in connection with Tenant's
merchandising activities shall be contained within the Premises and deposited
daily outside the storefront of the Premises. Landlord will remove such trash as
more particularly described in Sections C and D of Schedule B. During such
construction and merchandising period, Tenant shall perform all duties and
obligations imposed by this Lease, including, without limitation, those
provisions relating to insurance and indemnification, saving and excepting only
the obligation to pay Rental (other than any Additional Rental due Landlord by
reason of Tenant's failure to perform any of its obligations hereunder), which
obligation shall commence when the Term commences.
Section 7.3. "Ready for Occupancy" Defined.
------------------------------
The Premises shall be "Ready for Occupancy" as of the date on which the
last of the following shall have occurred:
(a) Landlord shall have substantially completed all work
to be performed by it pursuant to Schedule B which is
necessary to permit Tenant to commence the work to be
performed by it under Schedule B.
For the purpose of this clause (a) of Section 7.3.,
the term "substantially completed" shall mean the date
upon which Landlord has completed its work as set
forth in Sections A and B of Schedule B to the extent,
as determined by Landlord, that Tenant's contractor
may commence the construction of Tenant's work as
specified in Section C of Schedule B.
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Landlord will not be required to complete the balance
of its work in the Premises until Tenant has commenced
construction of Tenant's work and completed certain
portions of said work designated by Landlord. Landlord
will then reenter the Premises and complete its work;
(b) Sixty (60) calendar days shall have passed from the
date Tenant shall have received Landlord's
authorization to enter the Premises to complete the
work to be performed by it pursuant to Schedule B and
to fixture the Premises and otherwise make the
Premises ready for opening for business;
(c) At least 4.5 automobile parking spaces for each 1,000
square feet of Landlord's Floor Area shall be
available in the Shopping Center; and
(d) At least 145,000 square feet of Landlord's Floor Area
in Landlord's Building, including the Premises but
excluding Anchor Stores, shall have been substantially
completed and turned over to tenants for finishing.
(e) An Anchor Store in the Shopping Center shall be
substantially completed and open or ready to open for
business.
Section 7.4. Effect of Opening for Business.
-------------------------------
By opening the Premises for business, Tenant shall be deemed to have
(a) accepted the Premises, (b) acknowledged that the Premises are Ready for
Occupancy hereunder, and (c) agreed that the obligations of Landlord under
Schedule B have been fully performed.
Section 7.5. Mechanic's Liens.
-----------------
No work performed by Tenant pursuant to this Lease, whether in the
nature of erection, construction, alteration or repair, shall be deemed to be
for the immediate use and benefit of Landlord so that no mechanic's or other
lien shall be allowed against the estate of Landlord by reason of any consent
given by Landlord to Tenant to improve the Premises. Tenant shall place such
contractual provisions as Landlord may request in all contracts and subcontracts
for Tenant's improvements assuring Landlord that no mechanic's liens will be
asserted against Landlord's interest in the Premises or the property of which
the Premises are a part. Said contracts and subcontracts shall provide, among
other things, the following: That notwithstanding anything in said contracts or
subcontracts to the contrary, Tenant's contractors, subcontractors, suppliers
and materialmen (hereinafter collectively referred to as "Contractors") will
perform the work and/or furnish the required materials on the sole credit of
Tenant; that no lien for labor or materials will be filed or claimed by the
Contractors against Landlord's interest in the Premises or the property of which
the Premises are a part; that the Contractors will immediately discharge any
such lien filed by any of the Contractor's suppliers, laborers, materialmen or
subcontractors; and that the Contractors will indemnify and save Landlord
harmless from any and all costs and expenses, including reasonable attorneys'
fees, suffered or incurred as a result of any such lien against Landlord's
interest that may be filed or claimed in connection with or arising out of work
undertaken by the Contractors. Tenant shall pay promptly all persons furnishing
labor or materials with respect to any work performed by Tenant or its
Contractors on or about the Premises. If any mechanic's or other liens shall at
any time be filed against the Premises or the property of which the Premises are
a part by reason of work, labor, services or materials performed or furnished,
or alleged to have been performed or furnished, to Tenant or to anyone holding
the Premises through or under Tenant, and regardless of whether any such lien is
asserted against the interest of Landlord or Tenant, Tenant shall forthwith
cause the same to be discharged of record or bonded to the satisfaction of
Landlord. If Tenant shall fail to cause such lien forthwith to be so discharged
or bonded after being notified of the filing thereof, then, in addition to any
other right or remedy of Landlord, Landlord may bond or discharge the same by
paying the amount
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claimed to be due, and the amount so paid by Landlord, including reasonable
attorneys' fees incurred by Landlord either in defending against such lien or in
procuring the bonding or discharge of such lien, together with interest thereon
at the Default Rate, shall be due and payable by Tenant to Landlord as
Additional Rental.
Section 7.6. Tenant's Leasehold Improvements and Trade Fixtures.
---------------------------------------------------
All leasehold improvements (as distinguished from trade fixtures and
apparatus) installed in the Premises at any time, whether by or on behalf of
Tenant or by or on behalf of Landlord, shall not be removed from the Premises at
any time, unless such removal is consented to in advance by Landlord; and at the
expiration of this Lease (either on the Termination Date or upon such earlier
termination as provided in this Lease), all such leasehold improvements shall be
deemed to be part of the Premises, shall not be removed by Tenant when it
vacates the Premises, and title thereto shall vest solely in Landlord without
payment of any nature to Tenant.
All trade fixtures and apparatus (as distinguished from leasehold
improvements) owned by Tenant and installed in the Premises shall remain the
property of Tenant and shall be removable at any time, including upon the
expiration of the Term, provided Tenant shall not at such time be in default of
any terms or covenants of this Lease, and provided further, that Tenant shall
repair any damage to the Premises caused by the removal of said trade fixtures
and apparatus and shall restore the Premises to substantially the same condition
as existed prior to the installation of said trade fixtures and apparatus.
To protect Landlord in the event Tenant defaults hereunder, Tenant
hereby grants to Landlord a security interest in all goods, inventory,
equipment, trade fixtures and all personal property belonging to Tenant which
are or may be put into the Premises during the Term and all proceeds of the
foregoing. Said security interest shall secure all amounts to be paid by Tenant
to Landlord hereunder, including all costs of collection and other costs
specified in Sections 17.2. and 17.3. hereof, and any other indebtedness of
Tenant to Landlord. Tenant agrees to sign any financing statement or security
agreement requested by Landlord in order to perfect such security interest. The
lien granted hereunder shall be in addition to any Landlord's lien that may now
or at any time hereafter be provided by law.
ARTICLE VIII
OPERATIONS
----------
Section 8.1. Operations by Tenant.
---------------------
In regard to the use and occupancy of the Premises, Tenant will at its
expense: (a) keep the inside and outside of all glass in the doors and windows
of the Premises clean; (b) keep all exterior store surfaces of the Premises
clean; (c) replace promptly any cracked or broken glass of the Premises with
glass of like color, grade and quality; (d) maintain the Premises in a clean,
orderly and sanitary condition and free of insects, rodents, vermin and other
pests; (e) keep any garbage, trash, rubbish or other refuse in rat-proof
containers within the interior of the Premises until removed; (f) deposit such
garbage, trash, rubbish and refuse on a daily basis in designated receptacles
provided by Landlord; (g) keep all mechanical apparatus free of vibration and
noise which may be transmitted beyond the Premises; (h) comply with all laws,
ordinances, rules and regulations of governmental authorities and all reasonable
recommendations of Landlord's casualty insurer(s) and other applicable insurance
rating organization now or hereafter in effect; (i) light the show windows of
the Premises and exterior signs and turn the same off to the extent required by
Landlord; (j) keep in the Premises and maintain in good working order one (1) or
more type 2A10BC dry chemical fire extinguisher(s); (k) comply with and observe
all rules and regulations established by Landlord from time to time which apply
generally to all retail tenants in the Shopping Center Area; (l) maintain
sufficient and seasonal inventory and have sufficient number
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of personnel to maximize sales volume in the Premises; and (m) conduct its
business in all respects in a dignified manner in accordance with high standards
of store operation consistent with the quality of operation of the Shopping
Center Area as determined by Landlord and provide an appropriate mercantile
quality comparable with the entire Shopping Center.
In regard to the use and occupancy of the Premises and the Common
Areas, Tenant will not: (n) place or maintain any merchandise, signage, trash,
refuse or other articles in any vestibule or entry of the Premises, on the
footwalks or corridors adjacent thereto or elsewhere on the exterior of the
Premises, nor obstruct any driveway, corridor, footwalk, parking area, mall or
any other Common Areas; (o) use or permit the use of any objectionable
advertising medium such as, without limitation, loudspeakers, phonographs,
public address systems, sound amplifiers, reception of radio or television
broadcasts within the Shopping Center, which is in any manner audible or visible
outside of the Premises; (p) permit undue accumulations of or burn garbage,
trash, rubbish or other refuse within or without the Premises; (q) cause or
permit objectionable odors (in Landlord's opinion) to emanate or to be dispelled
from the Premises; (r) solicit business in any Common Areas; (s) distribute
handbills or other advertising matter in any Common Areas (including placing any
of the same in or upon automobiles parked in the parking areas); (t) permit the
parking of vehicles so as to interfere with the use of any driveway, corridor,
footwalk, parking area, mall or other Common Areas; (u) receive or ship articles
of any kind outside the designated loading areas for the Premises; (v) use the
mall, corridor, or any other Common Areas adjacent to the Premises for the sale
or display of any merchandise or for any other business, occupation or
undertaking; (w) conduct or permit to be conducted any auction, fictitious fire
sale, going out of business sale, bankruptcy sale (unless directed by a court
order), or other similar type sale in or connected with the Premises (but this
provision shall not restrict the absolute freedom of Tenant in determining its
own selling prices, nor shall it preclude the conduct of periodic seasonal,
promotional or clearance sales); (x) use or permit the use of any portion of the
Premises in a manner which will be in violation of law, or for any activity of a
type which is not generally considered appropriate for regional shopping centers
conducted in accordance with good and generally accepted standards of operation;
(y) place a load upon any floor which exceeds the floor load which the floor was
designed to carry; (z) operate its heating or air-conditioning in such a manner
as to drain heat or air-conditioning from the Common Areas or from the premises
of any other tenant or other occupant of the Shopping Center; (aa) use the
Premises for any unlawful or illegal business, use or purpose, or for any
business, use or purpose which is immoral or disreputable (including without
limitation "adult entertainment establishments" and "adult bookstores"), or
which is hazardous, or in such manner as to constitute a nuisance of any kind
(public or private), or for any purpose or in any way in violation of the
certificates of occupancy (or other similar approvals of applicable governmental
authorities).
Tenant acknowledges that it is Landlord's intent that the Shopping
Center Area be operated in a manner which is consistent with the highest
standards of decency and morals prevailing in the community which it serves.
Toward that end, Tenant agrees that it will not sell, distribute, display or
offer for sale any item which, in Landlord's good faith judgment, is
inconsistent with the quality of operation of the Shopping Center Area or may
tend to injure or detract from the moral character or image of the Shopping
Center Area within such community. Without limiting the generality of the
foregoing, Tenant will not sell, distribute, display or offer for sale (i) any
▇▇▇▇▇ clip, water pipe, bong, coke spoon, cigarette papers, hypodermic syringe
or other paraphernalia commonly used in the use or ingestion of illicit drugs,
(ii) any pornographic, lewd, suggestive, or "adult" newspaper, book, magazine,
film, picture, recording, representation or merchandise of any kind, or (iii)
any handgun.
Section 8.2. Signs and Advertising.
---------------------
Tenant will not place or suffer to be placed or maintained on the
exterior of the Premises, or any part of the interior visible from the exterior
thereof, any sign, banner, advertising matter or any other thing of any kind
(including, without limitation, any hand-lettered advertising), and
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will not place or maintain any decoration, letter or advertising matter on the
glass of any window or door of the Premises without first obtaining Landlord's
approval. Tenant will, at its sole cost and expense, maintain such sign, banner,
decoration, lettering, advertising matter or other thing as may be permitted
hereunder in good condition and repair at all times.
Section 8.3. Painting and Displays by Tenant.
--------------------------------
Tenant will not paint or decorate any part of the exterior of the
Premises, or any part of the interior of the Premises visible from the exterior
thereof, without first obtaining Landlord's approval. Tenant will install and
maintain at all times, subject to the other provisions of this Section, displays
of merchandise in the show windows (if any) of the Premises. All articles, and
the arrangement, style, color and general appearance thereof, in the interior of
the Premises including, without limitation, window displays, advertising matter,
signs, merchandise and store fixtures, shall be in keeping with the character
and standards of the improvements within the Shopping Center, as determined by
Landlord. Landlord reserves the right to require Tenant to correct any
non-conformity.
Section 8.4. Trash Removal Service.
----------------------
At its option, Landlord may furnish (or authorize others to furnish) a
service for the removal of trash from receptacles designated by Landlord for the
daily deposit by Tenant of its garbage, trash, rubbish or other refuse, and, if
it shall do so, then in each Rental Year, at Landlord's election, Tenant shall
either (i) reimburse Landlord monthly, as Additional Rental, for all costs
incurred by Landlord in furnishing such service, or (ii) pay Landlord the Trash
Removal Service Charge, if any, set forth in clause N of Section 1.1. in twelve
(12) equal monthly installments, subject to adjustments reflecting any increase
in Landlord's cost and expense in furnishing such trash removal service, or
(iii) pay directly such person, firm or corporation authorized by Landlord to
provide such trash removal service; provided, however, that all amounts which
Tenant is obligated to pay to Landlord pursuant to clause (i) or (ii) above
shall not exceed the amounts which Tenant would otherwise be obligated to pay
directly to the same independent contractor utilized by Landlord for the removal
of Tenant's trash, if Tenant were dealing with such contractor at arm's length
for trash removal services for the Premises.
Section 8.5. Permitted Use Disclaimer.
-------------------------
Nothing contained in this Lease shall be construed to indicate any
intent or attempt on the part of Landlord to restrict the price or prices at
which Tenant may sell any goods or services permitted to be sold at or from the
Premises pursuant to this Lease.
Section 8.6. Hazardous Substances.
---------------------
Tenant shall not use or allow the Premises to be used for the Release,
storage, use, treatment, disposal or other handling of any Hazardous Substance,
without the prior consent of Landlord. The term "Release" shall have the same
meaning as is ascribed to it in the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. ss. 9601 et seq., as amended
("CERCLA"). The term "Hazardous Substance" means (i) any substance defined as a
"hazardous substance" under CERCLA, (ii) petroleum, petroleum products, natural
gas, natural gas liquids, liquefied natural gas, and synthetic gas, and (iii)
any other substance or material deemed to be hazardous, dangerous, toxic, or a
pollutant under any federal, state or local law, code, ordinance or regulation.
Tenant shall: (a) give prior notice to Landlord of any activity or
operation to be conducted by Tenant at the Premises which involves the Release,
use, handling, generation, treatment, storage, or disposal of any Hazardous
Substance ("Tenant's Hazardous Substance Activity"), (b) comply with all
federal, state, and local laws, codes, ordinances, regulations, permits and
licensing
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conditions governing the Release, discharge, emission, or disposal of any
Hazardous Substance and prescribing methods for or other limitations on storing,
handling, or otherwise managing Hazardous Substances, (c) at its own expense,
promptly contain and remediate any Release of Hazardous Substances arising from
or related to Tenant's Hazardous Substance Activity in the Premises, Landlord's
Building, the Shopping Center, the Shopping Center Area or the environment and
remediate and pay for any resultant damage to property, persons, and/or the
environment, (d) give prompt notice to Landlord, and all appropriate regulatory
authorities, of any Release of any Hazardous Substance in the Premises,
Landlord's Building, the Shopping Center, the Shopping Center Area or the
environment arising from or related to Tenant's Hazardous Substance Activity,
which Release is not made pursuant to and in conformance with the terms of any
permit or license duly issued by appropriate governmental authorities, any such
notice to include a description of measures taken or proposed to be taken by
Tenant to contain and remediate the Release and any resultant damage to
property, persons, or the environment, (e) at Landlord's request, which shall
not be more frequent than once per calendar year, retain an independent engineer
or other qualified consultant or expert acceptable to Landlord, to conduct, at
Tenant's expense, an environmental audit of the Premises and immediate
surrounding areas, and the scope of work to be performed by such engineer,
consultant, or expert shall be approved in advance by Landlord, and all of the
engineer's, consultant's, or expert's work product shall be made available to
Landlord, (f) at Landlord's request from time to time, execute affidavits,
representations and the like concerning Tenant's best knowledge and belief
regarding the presence of Hazardous Substances in the Premises, (g) reimburse to
Landlord, upon demand, the reasonable cost of any testing for the purpose of
ascertaining if there has been any Release of Hazardous Substances in the
Premises, if such testing is required by any governmental agency or Landlord's
Mortgagee, (h) upon expiration or termination of this Lease, surrender the
Premises to Landlord free from the presence and contamination of any Hazardous
Substance.
ARTICLE IX
REPAIRS AND ALTERATIONS
-----------------------
Section 9.1. Repairs to be Made by Landlord.
-------------------------------
Landlord, at its expense, will make, or cause to be made structural
repairs to exterior walls, structural columns, roof penetrations and structural
floors which collectively enclose the Premises (excluding, however, all doors,
door frames, storefronts, windows and glass); provided Tenant shall give
Landlord notice of the necessity for such repairs.
Section 9.2. Repairs to be Made by Tenant.
-----------------------------
All repairs to the Premises or any installations, equipment or
facilities therein, other than those repairs required to be made by Landlord
pursuant to Sections 9.1., 12.3. and 14.1., shall be made by Tenant at its
expense. Without limiting the generality of the foregoing, Tenant will keep the
interior of the Premises, together with all electrical, plumbing and other
mechanical installations therein and (if and to the extent provided in Schedule
F) the heating, ventilating and air-conditioning system installed by Tenant in
the Premises, in good order and repair, and will make all replacements from time
to time required thereto at its expense. Tenant will surrender the Premises at
the expiration of the Term or at such other time as it may vacate the Premises
in as good condition as when received, excepting depreciation caused by ordinary
wear and tear, damage by Casualty, unavoidable accident or Act of God. Tenant
will not overload the electrical wiring serving the Premises or within the
Premises, and will install at its expense, subject to the provisions of Section
9.4., any additional electrical wiring which may be required in connection with
Tenant's apparatus. Any damage or injury sustained by any person because of
mechanical, electrical, plumbing or any other equipment or installations, whose
maintenance and repair shall be the responsibility of Tenant, shall be paid for
by Tenant, and Tenant hereby agrees to indemnify and hold Landlord harmless from
and against all claims, actions, damages and liability
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in connection therewith, including, but not limited to attorneys' and other
professional fees, and any other cost which Landlord might reasonably incur.
Section 9.3. Damage to Premises.
-------------------
Tenant will repair promptly at its expense any damage to the Premises
and, upon demand, shall reimburse Landlord (as Additional Rental) for the cost
of the repair of any damage elsewhere in the Shopping Center, caused by or
arising from the installation or removal of property in or from the Premises,
regardless of fault or by whom such damage shall be caused (unless caused by
Landlord, its agents, employees or contractors). If Tenant shall fail to
commence such repairs within five (5) days after notice to do so from Landlord,
Landlord may make or cause the same to be made, and Tenant agrees to pay to
Landlord promptly upon Landlord's demand, as Additional Rental, the cost thereof
with interest thereon at the Default Rate until paid.
Section 9.4. Alterations by Tenant.
----------------------
Tenant will not make any alterations, renovations, improvements or
other installations in, on or to any part of the Premises (including, without
limitation, any alterations of the storefront, signs, structural alterations, or
any cutting or drilling into any part of the Premises or any securing of any
fixture, apparatus, or equipment of any kind to any part of the Premises) unless
and until Tenant shall have caused plans and specifications therefor to have
been prepared, at Tenant's expense, by an architect or other duly qualified
person and shall have obtained Landlord's approval thereof. If such approval is
granted, Tenant shall cause the work described in such plans and specifications
to be performed, at its expense, promptly, efficiently, competently and in a
good and workmanlike manner by duly qualified and licensed persons or entities,
using first grade materials, without interference with or disruption to the
operations of tenants or other occupants of the Shopping Center. All such work
shall comply with all applicable codes, rules, regulations and ordinances.
Section 9.5. Changes and Additions to Shopping Center.
-----------------------------------------
Landlord reserves the right at any time and from time to time to (a)
make or permit changes or revisions in the plan for the Shopping Center or the
Shopping Center Area including additions to, subtractions from, rearrangements
of, alterations of, modifications of, or supplements to, the building areas,
walkways, driveways, parking areas, or other Common Areas, (b) construct
improvements in Landlord's Building and the Shopping Center Area and make
alterations thereof or additions thereto and build additional stories on or in
any such building(s) and build adjoining same, including (without limitation)
kiosks, pushcarts and other displays in the Common Areas, and (c) make or permit
changes or revisions in the Shopping Center or the Shopping Center Area,
including additions thereto, and to convey portions of the Shopping Center Area
to others for the purpose of constructing thereon other buildings or
improvements, including additions thereto and alterations thereof; provided,
however, that no such changes, rearrangements or other construction shall reduce
the parking areas below the number of parking spaces required by law.
Section 9.6. Roof and Walls.
---------------
Landlord shall have the exclusive right to use all or any part of the
roof of the Premises for any purpose; to erect additional stories or other
structures over all or any part of the Premises; to erect in connection with the
construction thereof temporary scaffolds and other aids to construction on the
exterior of the Premises, provided that access to the Premises shall not be
denied; and to install, maintain, use, repair and replace within the Premises
pipes, ducts, conduits, wires and all other mechanical equipment serving other
parts of the Shopping Center Area, the same to be in locations within the
Premises as will not unreasonably deny Tenant's use thereof. Landlord may make
any use it desires of the side or rear walls of the Premises or other structural
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elements of the Premises (including, without limitation, free standing columns
and footings for all columns), provided that such use shall not encroach on the
interior of the Premises unless (i) all work carried on by Landlord with respect
to such encroachment shall be done during hours when the Premises are not open
for business and otherwise shall be carried out in such a manner as not to
unreasonably interfere with Tenant's operations in the Premises, (ii) Landlord,
at its expense, shall provide any security services to the Premises required by
such work, and (iii) Landlord, at its expense, shall repair all damage to the
Premises resulting from such work.
ARTICLE X
COMMON AREAS
------------
Section 10.1. Use of Common Areas.
--------------------
Landlord grants to Tenant and its agents, employees and customers, a
non-exclusive license to use the Common Areas in common with others during the
Term, subject to the exclusive control and management thereof at all times by
Landlord or others and subject, further, to the rights of Landlord set forth in
Sections 9.5. and 10.2.
Section 10.2. Management and Operation of Common Areas.
-----------------------------------------
Landlord will operate, manage, secure, insure and maintain, or will
cause to be operated, managed, secured, insured and maintained, the Common Areas
in a manner deemed by Landlord to be reasonable and appropriate and in the best
interests of the Shopping Center and as are reasonably required for the
operation of a first class shopping center. Landlord will have the right (i) to
establish, modify and enforce reasonable rules and regulations with respect to
the Common Areas; (ii) to enter into, modify and terminate easement and other
agreements pertaining to the use and maintenance of the Common Areas; (iii) to
close all or any portion of the Common Areas to such extent as may, in the
opinion of Landlord, be necessary to prevent a dedication thereof or the accrual
of any rights to any person or to the public therein; (iv) to close temporarily
any or all portions of the Common Areas; and (v) to do and perform such other
acts in and to said areas and improvements as, in the exercise of good business
judgment, Landlord shall determine to be advisable.
Section 10.3. Employee Parking Areas.
-----------------------
Tenant and its employees shall park their cars only in such areas
designated for that purpose by Landlord. Upon request by Landlord, Tenant shall
furnish Landlord with State automobile license numbers assigned to Tenant's car
or cars and cars used by its employees and shall thereafter notify Landlord of
any changes in such information within five (5) days after such changes occur.
If Tenant or its employees shall fail to park their cars in the designated
parking areas, then, without limiting any other remedy which Landlord may pursue
in the event of Tenant's default, Landlord, after giving notice to Tenant, shall
have the right to charge Tenant, as Additional Rental, the sum of Ten Dollars
($10.00) per day per car parked in violation of the provisions of this Section.
Tenant shall notify its employees in writing of the provisions of this Section.
Section 10.4. Tenant's Contribution to Landlord's Operating Costs.
----------------------------------------------------
Tenant will pay Landlord, as Additional Rental, as Tenant's agreed
contribution toward Landlord's Operating Costs, an amount calculated as follows:
(a) In the period from the Commencement Date through the end of the
initial calendar year of the Term, Tenant shall pay to Landlord on the first day
of each calendar month an amount determined by (i) multiplying Tenant's
Operating Costs Contribution Rate set forth in
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Section 1.1.Y. by Tenant's Floor Area (the "Initial Operating Costs
Contribution"), and (ii) dividing the product thus obtained by twelve (12), the
first such payment to include also any prorated amount for the period from the
date of the commencement of the Term to the first day of the first full calendar
month in the Term.
(b) In the succeeding calendar year of the Term, Tenant shall pay to
Landlord an amount (the "Annual Operating Costs Contribution") determined by
adjusting the Initial Operating Costs Contribution by the greater of (i) four
percent (4%) or (ii) the increase in the Consumer Price Index for All Urban
Consumers (U.S. City Average) published by the Bureau of Labor Statistics of the
United States Department of Labor (the "Consumer Price Index") for the December
immediately prior to the year for which the adjustment is being made as compared
to the December Consumer Price Index reported for the preceding year. In each
subsequent year, Tenant's Annual Operating Costs Contribution shall be an amount
equal to Tenant's Annual Operating Costs Contribution for the prior calendar
year adjusted by the greater of (i) 4% or (ii) the Consumer Price Index for the
December immediately prior to the year for which the adjustment is being made as
compared to the December Consumer Price Index reported for the preceding year.
The Annual Operating Costs Contribution shall be paid by Tenant in twelve (12)
equal monthly installments, in advance, on the first day of each calendar month.
If during the Term the Consumer Price Index is changed or discontinued,
Landlord shall choose a comparable index, formula or other means of measurement
of the relative purchasing power of the dollar and such substitute index,
formula or other means shall be utilized in place of the Consumer Price Index as
it had been originally designated in this Lease.
Section 10.5. Landlord's Operating Costs.
---------------------------
The term "Landlord's Operating Costs" means all costs and expenses
incurred by or on behalf of Landlord in operating, managing, insuring, securing
and maintaining the Common Areas pursuant to Section 10.2., but does not include
any costs or expenses which Tenant is otherwise specifically required to pay
pursuant to this Lease.
Section 10.6. Mall Heating Ventilating and Air-Conditioning Equipment
-------------------------------------------------------
Contribution Rate.
------------------
In each Rental Year, Tenant shall pay Landlord annually (in twelve (12)
equal monthly installments together with the Annual Basic Rental), as Additional
Rental, an amount (the "Mall Heating, Ventilating and Air-Conditioning Equipment
Contribution") determined by multiplying the Mall Heating, Ventilating and
Air-Conditioning Equipment Contribution Rate by Tenant's Floor Area.
Section 10.7. Renovation or Expansion of Common Areas.
----------------------------------------
If, during the Term, the Common Areas, or any part thereof, are
expanded or renovated to the extent that Landlord's Improvement Costs incurred
in connection therewith exceed a sum equal to Twenty Dollars ($20.00) per square
foot of Landlord's Floor Area, the Annual Basic Rental and the dollar amount set
forth in clause H of Section 1.1 each shall be increased by ten percent (10%)
thereof for each such expansion or renovation effective as of the date on which
Landlord delivers to Tenant a notice that Landlord has incurred such costs. The
term "Landlord's Improvement Costs" means all direct and indirect costs and
expenses incurred by Landlord and properly allocated to the construction and
development of capital improvements to the Common Areas, but not including any
cost or expense included in Landlord's Operating Costs. Upon reasonable notice,
Landlord shall make available for Tenant's inspection (which inspection shall be
at Tenant's sole cost and expense) at Landlord's office, during normal business
hours, Landlord's records relating to Landlord's Improvement Costs as to which
any such notice shall have been delivered.
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ARTICLE XI
MARKETING FUND
--------------
Section 11.1. Marketing Fund.
---------------
On or before the Grand Opening Date of Landlord's Building, a special
fund for promoting the Shopping Center will be established ("Marketing Fund").
The Marketing Fund shall be used by Landlord in its sole discretion to pay the
costs and expenses associated with the formulation and carrying out of an
ongoing program for the marketing of the Shopping Center, which program may
include, without limitation, special events, shows, displays, signs, marquees,
decor, seasonal events, institutional advertising for the Shopping Center,
promotional literature and other activities within the Shopping Center designed
to attract customers. In addition, Landlord may use the Marketing Fund to defray
the costs of administration of the Marketing Fund including (without limitation)
the salary of a marketing administrator and related personnel (whether or not
located onsite), rent and insurance. In marketing the Shopping Center, Landlord
shall have the right to name Tenant's store in the Shopping Center.
Section 11.2. Tenant's Contribution to Marketing Fund.
----------------------------------------
(a) Tenant shall pay to Landlord in each Rental Year of the Term an
amount (the 'Annual Marketing Fund Contribution') determined by multiplying the
Marketing Fund Contribution Rate, as set forth in Section 1.1.L., by Tenant's
Floor Area. The Annual Marketing Fund Contribution shall be paid by Tenant in
twelve (12) equal monthly installments in advance on the first day of each
calendar month. The Annual Marketing Fund Contribution shall be adjusted
annually, as of the first day of each Fund Year during the Term, in that
proportion which the Consumer Price Index for All Urban Consumers (U.S. City
Average) of the United States Bureau of Labor Statistics ('Consumer Price
Index') most recently reported as of such adjustment date bears to the Consumer
Price Index most recently reported as of the January 1 preceding the
commencement of the Term, all such adjustments to be apportioned for fractional
years.
If during the Term the Consumer Price Index is changed or discontinued,
Landlord shall apply a comparable index, formula or other means of measurement
of the relative purchasing power of the dollar and such substitute index,
formula or other means shall be utilized in place of the Consumer Price Index as
if it had been originally designated in this Lease.
(b) If, following the Grand Opening Date, the Shopping Center shall be
expanded by adding floor area equal to more than ten percent (10%) of Landlord's
Floor Area on the Grand Opening Date, Tenant shall pay to Landlord a one-time
charge for each such expansion (the "Expansion Opening Marketing Contribution")
determined by (i) multiplying Tenant's Floor Area by the average rate per square
foot of all Marketing Fund Contributions which tenants in the expansion area
shall become obligated pursuant to their respective leases to make to Landlord
with respect to promotion and advertising of the opening of such expansion for
business, and (ii) dividing the product thus obtained by two (2).
(c) Prior to the date on which Tenant commences construction in the
Premises, Tenant shall pay Landlord an additional amount (the "Opening
Contribution") determined by multiplying the Opening Contribution Rate set forth
in Section 1.1.L by Tenant's Floor Area.
Section 11.3. Landlord's Contribution to Marketing Fund.
------------------------------------------
Each Fund Year, Landlord shall contribute to the Marketing Fund an
amount equal to fifteen percent (15%) of the aggregate contributions made by the
other contributors to the Marketing Fund for such period.
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Section 11.4. "First Fund Year" and "Fund Year" Defined.
------------------------------------------
"First Fund Year" shall mean the period commencing on the first day of
the Term and terminating on the second succeeding December 31. "Fund Year" means
each successive period of twelve (12) months commencing with January 1.
ARTICLE XII
UTILITIES
---------
Section 12.1. Water, Electricity, Telephone and Sanitary Sewer.
-------------------------------------------------
Landlord will provide, or cause to be provided, at points in or near
the Premises the facilities necessary to enable Tenant to obtain for the
Premises water, electricity, telephone and sanitary sewer service. Schedule E
sets forth those utilities for which service shall be provided to the Premises
by Landlord, if any, as well as the manner in which charges for their
consumption shall be determined and paid by Tenant. Unless otherwise provided in
Schedule E, Landlord shall not be responsible for providing any utility service
to the Premises, nor for providing meters or other devices for the measurement
of utilities supplied to the Premises, and Tenant shall arrange for the
furnishing to the Premises of such utility services as it may require, as well
as for the installation of all such meters or other devices. Tenant shall be
solely responsible for and shall promptly pay, as and when the same become due
and payable, all charges for water, sewer, electricity, gas, telephone and any
other utility used or consumed in the Premises and supplied by a public utility
or public authority or any other person, firm or corporation, including
Landlord, supplying the same.
If Schedule E does not provide that Landlord will supply electricity to
the Premises, Landlord shall have the option, exercisable at any time and from
time to time during the Term, to supply electricity to the Premises. If Landlord
shall elect to supply electricity to the Premises, Tenant will purchase its
requirements for such service tendered by Landlord, and Tenant will pay
Landlord, within ten (10) days after mailing by Landlord to Tenant of statements
therefor, at the applicable rates determined by Landlord from time to time which
Landlord agrees shall be reasonable and not be in excess of the public utility
rates for the same service, if applicable, but in no event less than Landlord's
actual cost. If Landlord so elects to supply electricity, Tenant shall execute
and deliver to Landlord, within ten (10) days after request therefor, any
documentation reasonably required by Landlord to effect such change in the
method of furnishing of electricity.
Landlord, in its sole discretion, shall have the right, from time to
time, to alter the method and source of supply to the Premises of electricity or
any other utility, and Tenant agrees to execute and deliver to Landlord such
documentation as may be required to effect such alteration; provided, however,
that Tenant shall not be required to bear any portion of the cost of such
alteration or to incur any additional financial obligation as a result of such
alteration, other than as provided in Schedule E.
Tenant shall not at any time overburden or exceed the capacity of the
mains, feeders, ducts, conduits, or other facilities by which such utilities are
supplied to, distributed in or serve the Premises. If Tenant desires to install
any equipment which shall require additional utility facilities or utility
facilities of a greater capacity than the facilities provided by Landlord, such
installation shall be subject to Landlord's prior approval of Tenant's plans and
specifications therefor. If such installation is approved by Landlord and if
Landlord provides such additional facilities to accommodate Tenant's
installation, Tenant agrees to pay Landlord, on demand, the cost for providing
such additional utility facilities or utility facilities of greater capacity.
-22-
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Section 12.2. Heating, Ventilating and Air-Conditioning.
------------------------------------------
Schedule F entitled "Tenant Heating, Ventilating and Air-Conditioning"
specifies the obligations of Landlord and Tenant (other than those obligations
set forth in Article X) regarding the heating, ventilating, and air-conditioning
equipment and system serving the Premises or the Shopping Center Area and the
energy required to operate the heating, ventilating and air-conditioning
equipment serving the Premises. Tenant covenants and agrees to pay to Landlord,
as Additional Rental and in the same manner as Annual Basic Rental is payable,
all charges as the same may be adjusted from time to time, as more particularly
set forth in said Schedule F.
Landlord, in its sole discretion, shall have the right, from time to
time, to alter the heating, ventilating and air-conditioning systems and
equipment serving the Shopping Center, or any part thereof, and Tenant agrees to
execute and deliver to Landlord such documentation as may be required to effect
such alteration, provided, however, that Tenant shall not be required to bear
any portion of the cost of such alteration or to incur any additional financial
obligation as a result of such alteration.
Tenant shall not at any time overburden or exceed the capacity of the
heating, ventilating and air-conditioning systems and equipment serving the
Premises. If Tenant desires any additional equipment or revision of the design
of the existing equipment, or if Landlord deems it necessary, because of
internal loading causing the temperature in the Premises to exceed the
temperature in the Common Areas, to install any additional equipment or revise
the design of the existing equipment, such additional equipment or revised
design shall be subject to Landlord's prior approval of Tenant's plans and
specifications therefor and shall be at Tenant's sole cost and expense. If such
additional equipment or revised design is approved by Landlord and if Landlord
provides such additional equipment or revised design, Tenant agrees to pay
Landlord, on demand, the cost for providing such additional equipment or revised
design.
Section 12.3. Fire Protection Sprinkler System.
---------------------------------
Landlord shall provide, install, repair and maintain, or cause to be
provided, installed, repaired and maintained, a fire protection sprinkler system
in the Premises (as more specifically described in Schedule B, if this Lease
includes a Schedule B) which system shall remain the property of Landlord.
Tenant shall pay Landlord, as Additional Rental, for providing such fire
protection sprinkler system, an annual amount determined by multiplying the
Sprinkler Contribution Rate by Tenant's Floor Area, said annual sum to be
payable in twelve (12) equal monthly installments, in advance on the first day
of each calendar month. Any modifications or additions to the sprinkler system,
whether required as a result of the improvements to be made to the Premises or
requested by Tenant after commencement of the Term, shall be made by Landlord at
Tenant's cost and expense (after agreement between Landlord and Tenant on a
price for such work) or, at Landlord's election, shall be made by Tenant (at its
cost and expense), provided Tenant utilizes a licensed contractor approved by
Landlord for such purpose.
Section 12.4. Discontinuances and Interruptions of Utility Services.
------------------------------------------------------
Landlord reserves the right to cut off and discontinue, upon notice to
Tenant, furnishing any heating, ventilation, air-conditioning or other utility
services furnished by Landlord at any time when Tenant has failed to pay when
due any amount (whether as Rental or otherwise) due under this Lease. Landlord
shall not be liable for any damages resulting from or arising out of any such
discontinuance and the same shall not constitute a termination of this Lease or
an eviction of Tenant. Landlord shall not be liable to Tenant in damages or
otherwise (i) if any utility shall become unavailable from any public utility
company, public authority or any other person or entity (including Landlord)
supplying or distributing such utility, or (ii) for any interruption in any
utility service (including, without limitation, any heating, ventilation,
air-conditioning or sprinkler) caused by the making of any necessary repairs or
improvements or by any cause beyond Landlord's
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reasonable control, and the same shall not constitute a termination of this
Lease or an eviction of Tenant.
ARTICLE XIII
INDEMNITY AND INSURANCE
-----------------------
Section 13.1. Indemnities.
------------
To the extent permitted by law, Tenant shall and does hereby indemnify
Landlord and agrees to save it harmless and, at Landlord's option, defend it
from and against any and all claims, actions, damages, liabilities and expenses
(including attorneys' and other professional fees) judgments, settlement
payments, and fines paid, incurred or suffered by Landlord in connection with
loss of life, personal injury and/or damage to property or the environment
suffered by third parties arising from or out of the occupancy or use by Tenant
of the Premises or any part thereof or any other part of the Shopping Center,
occasioned wholly or in part by any act or omission of Tenant, its officers,
agents, contractors, employees or invitees, or arising, directly or indirectly,
wholly or in part from any conduct, activity, act, omission, or operation
involving the use, handling, generation, treatment, storage, disposal, other
management or Release of any Hazardous Substance in, from or to the Premises,
whether or not Tenant may have acted negligently with respect to such Hazardous
Substance. Tenant's obligations pursuant to this Section shall survive any
termination of this Lease with respect to any act, omission or occurrence which
took place prior to such termination.
To the extent permitted by law, Landlord shall and does hereby
indemnify Tenant and agrees to save it harmless from and against any and all
claims, actions, damages, liabilities and expenses (including attorneys' and
other professional fees) in connection with loss of life, personal injury and/or
damage to property suffered by third parties arising from or out of the use of
any portion of the Common Areas by Landlord, occasioned wholly or in part by any
act or omission of Landlord, its officers, agents, contractors or employees.
Section 13.2. Landlord Not Responsible for Acts of Others.
--------------------------------------------
Landlord shall not be responsible or liable to Tenant, or to those
claiming by, through or under Tenant, for any loss or damage which may be
occasioned by or through the acts or omissions of persons occupying space
adjoining the Premises or any part of the premises adjacent to or connecting
with the Premises or any other part of the Shopping Center, or otherwise, or for
any loss or damage resulting to Tenant, or those claiming by, through or under
Tenant, or its or their property, from the breaking, bursting, stoppage or
leaking of electrical cable and wires, or water, gas, sewer or steam pipes. To
the maximum extent permitted by law, Tenant agrees to use and occupy the
Premises, and to use such other portions of the Shopping Center as Tenant is
herein given the right to use, at Tenant's own risk.
Section 13.3. Tenant's Insurance.
-------------------
At all times on and after delivery of the Premises to Tenant, Tenant
will carry and maintain, at its expense, a non-deductible:
(a) commercial general liability insurance policy,
including (but not limited to) insurance against
assumed or contractual liability under this Lease with
respect to liability arising out of the ownership,
use, occupancy or maintenance of the Premises and all
areas appurtenant thereto, to afford protection with
respect to personal injury, death or property damage
of not less than Two Million Dollars ($2,000,000) per
occurrence combined single
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limit/Four Million Dollars ($4,000,000) general
aggregate (but not less than $2,000,000 per location
aggregate);
(b) all-risks property and casualty insurance policy,
including theft coverage, written at replacement cost
value and with replacement cost endorsement, covering
all of Tenant's personal property in the Premises
(including, without limitation, inventory, trade
fixtures, floor coverings, furniture and other
property removable by Tenant under the provisions of
this Lease) and all leasehold improvements installed
in the Premises by or on behalf of Tenant;
(c) comprehensive boiler and machinery equipment policy,
including electrical apparatus, if applicable; and
(d) if and to the extent required by law, worker's
compensation insurance policy or similar insurance in
form and amounts required by law.
Section 13.4. Tenant's Contractor's Insurance.
--------------------------------
Tenant shall require any contractor of Tenant performing work on the
Premises to carry and maintain, at no expense to Landlord, a non-deductible:
(a) commercial general liability insurance policy,
including (but not limited to) contractor's liability
coverage, contractual liability coverage, completed
operations coverage, broad form property damage
endorsement and contractor's protective liability
coverage, to afford protection, with respect to
personal injury, death or property damage of not less
than Three Million Dollars ($3,000,000) per occurrence
combined single limit/Five Million Dollars
($5,000,000) general aggregate but not less than
$3,000,000 per location aggregate);
(b) comprehensive automobile liability insurance policy
with limits for each occurrence of not less than One
Million Dollars ($1,000,000) with respect to personal
injury or death and Five Hundred Thousand Dollars
($500,000) with respect to property damage; and
(c) worker's compensation insurance policy or similar
insurance in form and amounts required by law.
Section 13.5. Policy Requirements.
--------------------
The company or companies writing any insurance which Tenant is required
to carry and maintain or cause to be carried or maintained pursuant to Sections
13.3. and 13.4., as well as the form of such insurance, shall at all times be
subject to Landlord's approval and any such company or companies shall be
licensed to do business in the State in which the Shopping Center is located.
Commercial general liability and all-risks property and casualty insurance
policies evidencing such insurance shall, with respect to commercial general
liability policies, name Landlord and/or its designee(s) as additional insured,
and, with respect to all-risks property and casualty insurance policies, name
Landlord and/or its designee(s) as loss payee, shall be primary and
non-contributory, and shall also contain a provision by which the insurer agrees
that such policy shall not be canceled, materially changed or not renewed
without at least thirty (30) days' advance notice to Landlord, c/o The ▇▇▇▇▇
Company, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Risk Manager, by certified mail, return receipt requested, or to such other
party or address as may be designated by Landlord or its designee. Each such
policy, or a certificate thereof, shall be deposited with Landlord by Tenant
promptly upon commencement of Tenant's
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obligation to procure the same. If Tenant shall fail to perform any of its
obligations under Sections 13.3., 13.4. or 13.5., Landlord may perform the same
and the cost of same shall be deemed Additional Rental and shall be payable upon
Landlord's demand.
Section 13.6. Increase in Insurance Premiums.
-------------------------------
Tenant will not do or suffer to be done, or keep or suffer to be kept,
anything in, upon or about the Premises which will violate Landlord's policies
of hazard or liability insurance or which will prevent Landlord from procuring
such policies in companies acceptable to Landlord. If anything done, omitted to
be done or suffered by Tenant to be kept in, upon or about the Premises shall
cause the rate of fire or other insurance on the Premises or on other property
of Landlord or of others within the Shopping Center to be increased beyond the
minimum rate from time to time applicable to the Premises or to any such
property for the use or uses made thereof, Tenant will pay, as Additional
Rental, the amount of any such increase upon Landlord's demand.
Section 13.7. Waiver of Right of Recovery.
----------------------------
Except as provided in Section 8.6., neither Landlord nor Tenant shall
be liable to the other or to any insurance company (by way of subrogation or
otherwise) insuring the other party for any loss or damage to any building,
structure or other tangible property, or any resulting loss of income, or losses
under worker's compensation laws and benefits, even though such loss or damage
might have been occasioned by the negligence of such party, its agents or
employees. The provisions of this Section 13.7. shall not limit the
indemnification for liability to third parties pursuant to Section 13.1.
Section 13.8. Tenant to Pay Proportionate Share of Insurance Costs.
-----------------------------------------------------
Tenant will pay Landlord, as Additional Rental, a proportionate share
of Landlord's cost of maintaining all insurance with respect to Landlord's
Building (other than the Common Areas) including, without limitation, all-risks
property and casualty insurance and rent insurance. Such insurance may be
carried at the discretion of Landlord in such amounts and companies as Landlord
shall determine.
Tenant's proportionate share of such costs shall be computed by
multiplying Landlord's insurance costs by a fraction, the numerator of which
shall be Tenant's Floor Area and the denominator of which shall be Landlord's
Floor Area. Such proportionate share shall be paid by Tenant in monthly
installments in such amounts as are estimated and billed by Landlord during each
twelve (12) month period commencing and ending on dates designated by Landlord,
each installment being due on the first day of each calendar month. At any time
during any such twelve (12) month period, Landlord may reestimate Tenant's
proportionate share of Landlord's insurance costs and thereafter adjust Tenant's
monthly installments payable during such twelve (12) month period to reflect
more accurately Tenant's proportionate share of such costs. Within one hundred
twenty (120) days (or such additional time thereafter as is reasonable under the
circumstances) after the end of each such twelve (12) month period Landlord
shall deliver to Tenant a statement of such insurance costs for such twelve (12)
month period and the installments paid or payable shall be adjusted between
Landlord and Tenant, and Tenant shall pay Landlord or Landlord shall credit
Tenant's account or (if such adjustment is at the end of the Term Landlord shall
pay Tenant), as the case may be, within fifteen (15) days of receipt of such
statement, such amounts as may be necessary to effect such adjustment. Upon
reasonable notice, Landlord shall make available for Tenant's inspection at
Landlord's office, during normal business hours, Landlord's records relating to
such insurance costs for such preceding twelve (12) month period. Failure of
Landlord to provide the statement called for hereunder within the time
prescribed shall not relieve Tenant of its obligations hereunder.
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ARTICLE XIV
DAMAGE AND DESTRUCTION
----------------------
Section 14.1. Landlord's Obligation to Repair and Reconstruct.
------------------------------------------------
If the Premises shall be damaged by fire, the elements, accident or
other casualty (any of such causes being referred to herein as a "Casualty"),
but the Premises shall not be thereby rendered wholly or partially untenantable,
Landlord shall promptly cause such damage to be repaired and there shall be no
abatement of Rental. If, as the result of Casualty, the Premises shall be
rendered wholly or partially untenantable, then, subject to the provisions of
Section 14.2., Landlord shall cause such damage to be repaired and all Rental
(other than any Additional Rental due Landlord by reason of Tenant's failure to
perform any of its obligations hereunder) shall be abated proportionately as to
the portion of the Premises rendered untenantable during the period of such
untenantability, and, in addition, during such period of untenantability, the
Breakpoint shall also be proportionately reduced by an amount equal to the
amount obtained by multiplying the Breakpoint by a fraction, the numerator of
which shall be the length of time the Premises are closed and the denominator of
which shall be the length of the Rental Year(s) in question. All such repairs
shall be made at the expense of Landlord; provided, however, that Landlord shall
not be liable for interruption to Tenant's business or for damage to or
replacement or repair of Tenant's personal property (including, without
limitation, inventory, trade fixtures, floor coverings, furniture and other
property removable by Tenant under the provisions of this Lease) or to any
leasehold improvements installed in the Premises by or on behalf of Tenant, all
of which damage, replacement or repair shall be undertaken and completed by
Tenant promptly.
Section 14.2. Landlord's Option to Terminate Lease.
-------------------------------------
If the Premises are (a) rendered wholly untenantable, or (b) damaged as
a result of any cause which is not covered by Landlord's insurance or (c)
damaged or destroyed in whole or in part during the last three (3) years of the
Term, or if Landlord's Building is damaged to the extent of fifty percent (50%)
or more of Landlord's Floor Area, then, in any of such events, Landlord may
elect to terminate this Lease by giving to Tenant notice of such election within
ninety (90) days after the occurrence of such event. If such notice is given,
the rights and obligations of the parties shall cease as of the date of such
notice, and Rental (other than any Additional Rental due Landlord by reason of
Tenant's failure to perform any of its obligations hereunder) shall be adjusted
as of the date of such termination.
Section 14.3. Demolition of Landlord's Building.
----------------------------------
If Landlord's Building shall be so substantially damaged that it is
reasonably necessary, in Landlord's sole judgment, to demolish same for the
purpose of reconstruction, Landlord may demolish the same, in which event the
Rental shall be abated to the same extent as if the Premises were rendered
untenantable by a Casualty.
Section 14.4. Insurance Proceeds.
-------------------
If Landlord does not elect to terminate this Lease pursuant to Section
14.2., Landlord shall, subject to the prior rights of any Mortgagee, disburse
and apply any insurance proceeds received by Landlord to the restoration and
rebuilding of Landlord's Building in accordance with Section 14.1. hereof. All
insurance proceeds payable with respect to the Premises (excluding proceeds
payable to Tenant pursuant to Section 13.3.) shall belong to and shall be
payable to Landlord.
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ARTICLE XV
CONDEMNATION
------------
Section 15.1. Effect of Taking.
-----------------
If the whole or any part of the Premises shall be taken under the power
of eminent domain, this Lease shall terminate as to the part so taken on the
date Tenant is required to yield possession thereof to the condemning authority.
Landlord shall make, or cause to be made, such repairs and alterations as may be
necessary in order to restore the part not taken to useful condition and all
Rental (other than any Additional Rental due Landlord by reason of Tenant's
failure to perform any of its obligations hereunder) shall be reduced in the
same proportion as the portion of the floor area of the Premises so taken bears
to Tenant's Floor Area. If the aforementioned taking renders the remainder of
the Premises unsuitable for the Permitted Use, either party may terminate this
Lease as of the date when Tenant is required to yield possession by giving
notice to that effect within thirty (30) days after such date. If twenty percent
(20%) or more of Landlord's Floor Area is taken as aforesaid, or if parking
spaces in the Shopping Center are so taken thereby reducing the number of
parking spaces to less than the number required by law and Landlord does not
deem it reasonably feasible to replace such parking spaces with other parking
spaces on the portion of the Shopping Center not taken, then Landlord may elect
to terminate this Lease as of the date on which possession thereof is required
to be yielded to the condemning authority, by giving notice of such election
within ninety (90) days after such date. If any notice of termination is given
pursuant to this Section, this Lease and the rights and obligations of the
parties hereunder shall cease as of the date of such notice and Rental (other
than any Additional Rental due Landlord by reason of Tenant's failure to perform
any of its obligations hereunder) shall be adjusted as of the date of such
termination.
Section 15.2. Condemnation Awards.
--------------------
All compensation awarded for any taking of the Premises, Landlord's
Building, the Shopping Center Area, or any interest in any of the same, shall
belong to and be the property of Landlord, Tenant hereby assigning to Landlord
all rights with respect thereto; provided, however, nothing contained herein
shall prevent Tenant from applying for reimbursement from the condemning
authority (if permitted by law) for moving expenses, or the expense of removal
of Tenant's trade fixtures, or loss of Tenant's business good will, but only if
such action shall not reduce the amount of the award or other compensation
otherwise recoverable from the condemning authority by Landlord or the owner of
the fee simple estate in the Shopping Center Area.
ARTICLE XVI
ASSIGNMENTS AND SUBLETTING
--------------------------
Section 16.1. Landlord's Consent Required.
----------------------------
(a) Except as provided in Section 17.4 with respect to assignment of
this Lease following Tenant's bankruptcy, Tenant will not assign this Lease, in
whole or in part, nor sublet all or any part of the Premises, nor license
concessions or lease departments therein, nor pledge or encumber by mortgage or
other instruments its interest in this Lease (each individually and collectively
referred to in this Section as a "transfer") without first obtaining the consent
of Landlord, which consent Landlord may withhold in its sole and absolute
discretion. This prohibition includes, without limitation, any subletting or
assignment which would otherwise occur by operation of law, merger,
consolidation, reorganization, transfer or other change of Tenant's corporate,
partnership or proprietary structure. Any transfer to or by a receiver or
trustee in any federal or state bankruptcy, insolvency, or similar proceeding
shall be subject to, and in accordance
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with, the provisions of Section 17.4. Consent by Landlord to any transfer shall
not constitute a waiver of the requirement for such consent to any subsequent
transfer.
(b) Subject to the provisions of Section 17.4 respecting assignment of
this Lease following Tenant's bankruptcy and assumption of this Lease by Tenant
or its trustee, it is expressly understood and agreed that Landlord may, in its
sole and absolute discretion, withhold its consent to any transfer of this Lease
or of all or any part of the Premises. The parties recognize that this Lease and
the Premises are unique, and that this Lease and the Premises derive value from
the remainder of Landlord's Building and the Shopping Center Area as a whole,
and that the nature and character of the operations within and management of the
Premises are important to the success of Landlord's Building and the Shopping
Center Area. Accordingly, and without limiting the generality of the foregoing,
Landlord may condition its consent to any transfer upon satisfaction of all or
any of the following conditions:
(i) the net assets of the assignee, licensee, sublessee or
other transferee or permittee (collectively
"transferee") immediately prior to the transfer shall
not be less than the greater of the net assets of
Tenant immediately prior to the transfer or the net
assets of Tenant at the time of the signing of this
Lease;
(ii) such transfer shall not adversely affect the quality
and type of business operation which Tenant has
conducted theretofore;
(iii) such transferee shall possess qualifications for the
Tenant business substantially equivalent to those of
Tenant and shall have demonstrated recognized
experience in successfully operating such a business,
including, without limitation, experience in
successfully operating a similar quality business in
first-class shopping centers;
(iv) such transferee shall continue to operate the business
conducted in the Premises under the same Tenant Trade
Name, in the same manner as Tenant and pursuant to all
of the provisions of this Lease;
(v) such transferee shall assume in writing, in a form
acceptable to Landlord, all of Tenant's obligations
hereunder and Tenant shall provide Landlord with a
copy of such assumption/transfer document;
(vi) Tenant shall pay to Landlord a transfer fee of One
Thousand Dollars ($1,000.00) prior to the effective
date of the transfer in order to reimburse Landlord
for all of its internal costs and expenses incurred
with respect to the transfer, including, without
limitation, costs incurred in connection with the
review of financial materials, meetings with
representatives of transferor and/or transferee and
preparation, review, approval and execution of the
required transfer documentation, and, in addition,
Tenant shall reimburse Landlord for any out-of- pocket
costs and expenses incurred with respect to such
transfer;
(vii) as of the effective date of the transfer and
continuing throughout the remainder of the Term, the
Annual Basic Rental shall be the greater of (A) the
Annual Basic Rental set forth in Section 1.1 .G.
hereof, or (B) the sum of all Annual Basic Rental and
all Annual Percentage Rental payable by Tenant during
the twelve calendar months preceding the transfer;
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(viii) Tenant to which the Premises were initially leased
shall continue to remain liable under this Lease for
the performance of all terms, including, but not
limited to, payment of Rental due under this Lease;
(ix) Tenant's guarantor, if any, shall continue to remain
liable under the terms of the guaranty of this Lease
and, if Landlord deems it necessary, such guarantor
shall execute such documents necessary to insure the
continuation of its guaranty;
(x) Landlord shall receive upon execution of its consent
the full unamortized amount of any construction or
other allowances given to the original Tenant under
this Lease, any due but unpaid Rental, and an amount
equal to fifteen percent (15%) of any and all
consideration paid or agreed to be paid, directly or
indirectly, to Tenant for such transfer or for the
sale of Tenant's business in connection with which any
such transfer is made; and
(xi) each of Landlord's Mortgagees shall have consented in
writing to such transfer.
Section 16.2. Transfer of Corporate Shares.
-----------------------------
If Tenant is a corporation (other than a corporation the outstanding
voting stock of which is listed on a "national securities exchange", as defined
in the Securities Exchange Act of 1934) and if, at any time after execution of
this Lease, any part or all of the corporate shares shall be transferred by
sale, assignment, bequest, inheritance, operation of law or other disposition
(including, but not limited to, such a transfer to or by a receiver or trustee
in federal or state bankruptcy, insolvency, or other proceedings) so as to
result in a change in the present control of said corporation by the person(s)
now owning a majority of said corporate shares, Tenant shall give Landlord
notice of such event within fifteen (15) days of the date of such transfer. If
any such transfer is made (and regardless of whether Tenant has given notice of
same), Landlord may elect to terminate this Lease at any time thereafter by
giving Tenant notice of such election, in which event this Lease and the rights
and obligations of the parties hereunder shall cease as of a date set forth in
such notice which date shall not be less than sixty (60) days after the date of
such notice. In the event of any such termination, all Rental (other than any
Additional Rental due Landlord by reason of Tenant's failure to perform any of
its obligations hereunder) shall be adjusted as of the date of such termination.
Section 16.3. Transfer of Partnership Interests.
----------------------------------
If Tenant is a general or limited partnership and if at any time after
execution of this Lease any part or all of the interests in the capital or
profits of such partnership or any voting or other interests therein shall
be transferred by sale, assignment, bequest, inheritance, operation of law or
other disposition (including, but not limited to, such a transfer to or by a
receiver or trustee in federal or state bankruptcy, insolvency or other
proceedings, and also including, but not limited to, any adjustment in such
partnership interests) so as to result in a change in the present control of
said partnership by the person or persons now having control of same, Tenant
shall give Landlord notice of such event within fifteen (15) days of the date of
such transfer. If any such transfer is made (and regardless of whether Tenant
has given notice of same), Landlord may elect to terminate this Lease at any
time thereafter by giving Tenant notice of such election, in which event this
Lease and the rights and obligations of the parties hereunder shall cease as of
a date set forth in such notice which date shall be not less than sixty (60)
days after the date of such notice. In the event of any such termination, all
Rental (other than any Additional Rental due Landlord by reason of Tenant's
failure to perform any of its obligations hereunder) shall be adjusted as of the
date of such termination.
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Section 16.4. Acceptance of Rent from Transferee.
-----------------------------------
The acceptance by Landlord of the payment of Rental following any
assignment or other transfer prohibited by this Article shall not be deemed to
be a consent by Landlord to any such assignment or other transfer nor shall the
same be deemed to be a waiver of any right or remedy of Landlord hereunder.
Section 16.5. Additional Provisions Respecting Transfers.
-------------------------------------------
Without limiting Landlord's right to withhold its consent to any
transfer by Tenant, and regardless of whether Landlord shall have consented to
any such transfer, neither Tenant nor any other person having an interest in the
possession, use or occupancy of the Premises or any part thereof shall enter
into any lease, sublease, license, concession, assignment or other transfer or
agreement for possession, use or occupancy of all or any portion of the Premises
which provides for rental or other payment for such use, occupancy or
utilization based, in whole or in part, on the net income or profits derived by
any person or entity from the space so leased, used or occupied, and any such
purported lease, sublease, license, concession, assignment or other transfer or
agreement shall be absolutely void and ineffective as a conveyance of any right
or interest in the possession, use or occupancy of all or any part of the
Premises. There shall be no deduction from the rental payable under any sublease
or other transfer nor from the amount thereof passed on to any person or entity,
for any expenses or costs related in any way to the subleasing or transfer of
such space.
If Tenant shall make or suffer any such transfer without first
obtaining any consent of Landlord required by Section 16.1, any and all amounts
received as a result of such transfer shall be the property of Landlord to the
extent the same (determined on a square foot basis) is greater than the Annual
Basic Rental (on a square foot basis) payable under this Lease, it being the
parties' intent that any profit resulting from such transfer shall belong to
Landlord, but the same shall not be deemed to be a consent by Landlord to any
such transfer or a waiver of any right or remedy of Landlord hereunder.
ARTICLE XVII
DEFAULT
-------
Section 17.1. "Event of Default" Defined.
---------------------------
Any one or more of the following events shall constitute an "Event of
Default":
(a) The sale of Tenant's interest in the Premises under
attachment, execution or similar legal process or, if
Tenant is adjudicated a bankrupt or insolvent under
any state bankruptcy or insolvency law or an order for
relief is entered against Tenant under the Federal
Bankruptcy Code and such adjudication or order is not
vacated within ten (10) days.
(b) The commencement of a case under any chapter of the
Federal Bankruptcy Code by or against Tenant or any
guarantor of Tenant's obligations hereunder, or the
filing of a voluntary or involuntary petition
proposing the adjudication of Tenant or any such
guarantor as bankrupt or insolvent, or the
reorganization of Tenant or any such guarantor, or an
arrangement by Tenant or any such guarantor with its
creditors, unless such petition is filed or case
commenced by a party other than Tenant or any such
guarantor and is withdrawn or dismissed within thirty
(30) days after the date of its filing.
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(c) The admission in writing by Tenant or any such
guarantor of its inability to pay its debts when due.
(d) The appointment of a receiver or trustee for the
business or property of Tenant or any such guarantor,
unless such appointment shall be vacated within ten
(10) days of its entry.
(e) The making by Tenant or any such guarantor of an
assignment for the benefit of its creditors, or if in
any other manner Tenant's interest in this Lease shall
pass to another by operation of law.
(f) The failure of Tenant to pay any Rental or other sum
of money within seven (7) days after the same is due
hereunder.
(g) Default by Tenant in the performance or observance of
any covenant or agreement of this Lease (other than a
default involving the payment of money), which default
is not cured within ten (10) days after the giving of
notice thereof by Landlord, unless such default is of
such nature that it cannot be cured within such ten
(10) day period, in which case no Event of Default
shall occur so long as Tenant shall commence the
curing of the default within such ten (10) day period
and shall thereafter diligently prosecute the curing
of same; provided, however, if Tenant shall default in
the performance of any such covenant or agreement of
this Lease two (2) or more times in any twelve (12)
month period, then notwithstanding that each of such
defaults shall have been cured by Tenant, any further
similar default shall be deemed an Event of Default
without the ability for cure.
(h) The vacation or abandonment of the Premises by Tenant
at any time following delivery of possession of the
Premises to Tenant.
(i) The occurrence of any other event described as
constituting an "Event of Default" elsewhere in this
Lease.
Section 17.2. Remedies.
---------
Upon the occurrence of an Event of Default, Landlord, without notice to
Tenant in any instance (except where expressly provided for below or by
applicable law) may do any one or more of the following:
(a) With or without judicial process, enter the Premises
and take possession of any and all goods, inventory,
equipment, fixtures and all other personal property of
Tenant, which is or may be put into the Premises
during the Term, whether exempt or not from sale under
execution or attachment (it being agreed that said
property shall at all times be bound with a lien in
favor of Landlord and shall be chargeable for all
Rental and for the fulfillment of the other covenants
and agreements herein contained), and Landlord may
sell all or any part thereof at public or private
sale. Tenant agrees that five (5) days prior notice of
any public or private sale shall constitute reasonable
notice. The proceeds of any such sale shall be applied
first, to the payment of all costs and expenses of
conducting the sale or caring for or storing said
property (including reasonable attorneys' fees);
second, toward the payment of any indebtedness,
including (without limitation) indebtedness for
Rental, which may be or may become due from Tenant to
Landlord; and third, to pay Tenant, on demand, any
surplus remaining after all indebtedness of Tenant to
Landlord has been fully paid;
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(b) Perform, on behalf and at the expense of Tenant, any
obligation of Tenant under this Lease which Tenant has
failed to perform and of which Landlord shall have
given Tenant notice, the cost of which performance by
Landlord, together with interest thereon at the
Default Rate from the date of such expenditure, shall
be deemed Additional Rental and shall be payable by
Tenant to Landlord upon demand. Notwithstanding the
provisions of this clause (b) and regardless of
whether an Event of Default shall have occurred,
Landlord may exercise the remedy described in this
clause (b) without any notice to Tenant if Landlord,
in its good faith judgment, believes it would be
materially injured by failure to take rapid action or
if the unperformed obligation of Tenant constitutes an
emergency;
(c) Elect to terminate this Lease and the tenancy created
hereby by giving notice of such election to Tenant,
and reenter the Premises, without the necessity of
legal proceedings, and remove Tenant and all other
persons and property from the Premises, and may store
such property in a public warehouse or elsewhere at
the cost of and for the account of Tenant without
resort to legal process and without Landlord being
deemed guilty of trespass or becoming liable for any
loss or damage occasioned thereby; or
(d) Exercise any other legal or equitable right or remedy
which it may have.
Any costs and expenses incurred by Landlord (including, without
limitation, reasonable attorneys' fees) in enforcing any of its rights or
remedies under this Lease shall be deemed to be Additional Rental and shall be
repaid to Landlord by Tenant upon demand.
Section 17.3. Damages.
--------
If this Lease is terminated by Landlord pursuant to Section 17.2.,
Tenant nevertheless shall remain liable for (a) any Rental and damages which may
be due or sustained prior to such termination, all reasonable costs, fees and
expenses including, but not limited to, reasonable attorneys' fees, costs and
expenses incurred by Landlord in pursuit of its remedies hereunder, or in
renting the Premises to others from time to time (all such Rental, damages,
costs, fees and expenses being referred to herein as "Termination Damages") and
(b) additional damages (the "Liquidated Damages"), which, at the election of
Landlord, shall be either:
(i) an amount equal to the Rental which, but for
termination of this Lease, would have become due
during the remainder of the Term, less the amount of
Rental, if any, which Landlord shall receive during
such period from others to whom the Premises may be
rented (other than any Additional Rental received by
Landlord as a result of any failure of such other
person to perform any of its obligations to Landlord),
in which case such Liquidated Damages shall be
computed and payable in monthly installments, in
advance, on the first day of each calendar month
following termination of the Lease and continuing
until the date on which the Term would have expired
but for such termination, and any suit or action
brought to collect any such Liquidated Damages for any
month shall not in any manner prejudice the right of
Landlord to collect any Liquidated Damages for any
subsequent month by a similar proceeding; or
(ii) an amount equal to the present worth (as of the date
of such termination) of Rental which, but for
termination of this Lease, would have become due
during the remainder of the Term, less the fair rental
value of the Premises, as determined by an independent
real estate appraiser named by Landlord,
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in which case such Liquidated Damages shall be payable
to Landlord in one lump sum on demand and shall bear
interest at the Default Rate until paid. For purposes
of this clause (ii), "present worth" shall be computed
by discounting such amount to present worth at a
discount rate equal to one percentage point above the
discount rate then in effect at the Federal Reserve
Bank nearest to the location of the Shopping Center.
If such termination shall take place after the expiration of two or
more Rental Years then, for purposes of computing the Liquidated Damages, the
Annual Percentage Rental payable with respect to each Rental Year following
termination (including the Rental Year in which such termination shall take
place) shall be conclusively presumed to be equal to the average Annual
Percentage Rental payable with respect to each complete Rental Year preceding
termination. If such termination shall take place before the expiration of two
Rental Years, then, for purposes of computing the Liquidated Damages, the Annual
Percentage Rental payable with respect to each Rental Year following termination
(including the Rental Year in which such termination shall take place) shall be
conclusively presumed to be equal to twelve (12) times the average monthly
payment of Annual Percentage Rental due prior to such termination, or if no
Annual Percentage Rental shall have been payable during such period, then the
Annual Percentage Rental for each year of the unexpired Term shall be
conclusively presumed to be a sum equal to twenty-five percent (25%) of the
Annual Basic Rental due and payable during such unexpired Term. Termination
Damages shall be due and payable immediately upon demand by Landlord following
any termination of this Lease pursuant to Section 17.2. Liquidated Damages shall
be due and payable at the times set forth herein.
If this Lease is terminated pursuant to Section 17.2., Landlord may
relet the Premises or any part thereof, alone or together with other premises,
for such term or terms (which may be greater or less than the period which
otherwise would have constituted the balance of the Term) and on such terms and
conditions (which may include concessions or free rent and alterations of the
Premises) as Landlord, in its sole discretion, may determine, but Landlord shall
not be liable for, nor shall Tenant's obligations hereunder be diminished by
reason of, any failure by Landlord to relet the Premises or any failure by
Landlord to collect any rent due upon such reletting.
Nothing contained in this Lease shall limit or prejudice the right of
Landlord to prove for and obtain, in proceedings for the termination of this
Lease by reason of bankruptcy or insolvency, an amount equal to the maximum
allowed by any statute or rule of law in effect at the time when, and governing
the proceedings in which, the damages are to be proved, whether or not the
amount be greater, equal to, or less than the amount of the loss or damages
referred to above. The failure or refusal of Landlord to relet the Premises or
any part or parts thereof shall not release or affect Tenant's liability for
damages.
Section 17.4. Remedies in Event of Bankruptcy or Other Proceeding.
----------------------------------------------------
(a) Anything contained herein to the contrary notwithstanding, if
termination of this Lease shall be stayed by order of any court having
jurisdiction over any proceeding described in paragraph (b) of Section 17.1., or
by federal or state statute, then, following the expiration of any such stay, or
if Tenant or Tenant as debtor-in-possession or the trustee appointed in any such
proceeding (being collectively referred to as "Tenant" only for the purposes of
this Section 17.4.) shall fail to assume Tenant's obligations under this Lease
within the period prescribed therefor by law or within fifteen (15) days after
entry of the order for relief or as may be allowed by the court, or if Tenant
shall fail to provide adequate protection of Landlord's right, title and
interest in and to the Premises or adequate assurance of the complete and
continuous future performance of Tenant's obligations under this Lease,
Landlord, to the extent permitted by law or by leave of the court having
jurisdiction over such proceeding, shall have the right, at its election, to
terminate this Lease on fifteen (15) days' notice to Tenant and upon the
expiration of said fifteen (15) day period this Lease shall cease and expire as
aforesaid and Tenant shall immediately quit and
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surrender the Premises as aforesaid. Upon the termination of this Lease as
provided above, Landlord, without notice, may re-enter and repossess the
Premises using such force for that purpose as may be necessary without being
liable to indictment, prosecution or damages therefor and may dispossess Tenant
by summary proceedings or otherwise.
(b) For the purposes of the preceding paragraph (a), adequate
protection of Landlord's right, title and interest in and to the Premises, and
adequate assurance of the complete and continuous future performance of Tenant's
obligations under this Lease, shall include, without limitation, the following
requirements:
(i) that Tenant comply with all of its obligations under
this Lease;
(ii) that Tenant pay to Landlord, on the first day of each
month occurring subsequent to the entry of such order,
or the effective date of such stay, a sum equal to the
amount by which the Premises diminished in value
during the immediately preceding monthly period, but,
in no event, an amount which is less than the
aggregate Rental payable for such monthly period;
(iii) that Tenant continue to use the Premises in the manner
originally required by this Lease;
(iv) that Landlord be permitted to supervise the
performance of Tenant's obligations under this Lease;
(v) that Tenant pay to Landlord within fifteen (15) days
after entry of such order or the effective date of
such stay, as partial adequate protection against
future diminution in value of the Premises and
adequate assurance of the complete and continuous
future performance of Tenant's obligations under this
Lease, an additional security deposit in an amount
acceptable to Landlord;
(vi) that Tenant has and will continue to have unencumbered
assets after the.payment of all secured obligations
and administrative expenses to assure Landlord that
sufficient funds will be available to fulfill the
obligations of Tenant under this Lease;
(vii) that if Tenant assumes this Lease and proposes to
assign the same (pursuant to Title 11 ▇.▇.▇.▇▇. 365,
or as the same may be amended) to any person who shall
have made a bona fide offer to accept an assignment of
this Lease on terms acceptable to such court having
competent jurisdiction over Tenant's estate, then
notice of such proposed assignment, setting forth (x)
the name and address of such person, (y) all of the
terms and conditions of such offer, and (z) the
adequate assurance to be provided Landlord to assure
such person's future performance under this Lease,
including, without limitation, the assurances referred
to in Title 11 U.S.C. ss. 365(b)(3), as it may be
amended, shall be given to Landlord by Tenant no later
than fifteen (15) days after receipt by Tenant of such
offer, but in any event no later than thirty (30) days
prior to the date that Tenant shall make application
to such court for authority and approval to enter into
such assignment and assumption, and Landlord shall
thereupon have the prior right and option, to be
exercised by notice to Tenant given at any time prior
to the effective date of such proposed assignment, to
accept, or to cause Landlord's designee to accept, an
assignment of this Lease upon the same terms and
conditions and for the same consideration, if any, as
the bona fide offer made by such person less any
brokerage commissions which may be payable
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out of the consideration to be paid by such person for
the assignment of this Lease; and
(viii) that if Tenant assumes this Lease and proposes to
assign the same, and Landlord does not exercise its
option pursuant to paragraph (vii) of this Section
17.4, Tenant hereby agrees that:
(A) such assignee shall have a net worth not
less than the net worth of Tenant as of the
Commencement Date, or such Tenant's
obligations under this Lease shall be
unconditionally guaranteed by a person
having a net worth equal to Tenant's net
worth as of the Commencement Date;
(B) such assignee shall not use the Premises
except subject to all the restrictions
contained in this Lease;
(C) such assignee shall assume in writing all of
the terms, covenants and conditions of this
Lease including, without limitation, all of
such terms, covenants and conditions
respecting the Permitted Use and payment of
Rental, and such assignee shall provide
Landlord with assurances satisfactory to
Landlord that it has the experience in
operating stores having the same or
substantially similar uses as the Permitted
Use, in first-class shopping centers,
sufficient to enable it so to comply with
the terms, covenants and conditions of this
Lease and successfully operate the Premises
for the Permitted Use;
(D) such assignee shall indemnify Landlord
against, and pay to Landlord the amount of,
any payments which Landlord may be obligated
to make to any Mortgagee by virtue of such
assignment;
(E) such assignee shall pay to Landlord an
amount equal to the unamortized portion of
any construction allowance made to Tenant;
and
(F) if such assignee makes any payment to
Tenant, or for Tenant's account, for the
right to assume this Lease (including,
without limitation, any lump sum payment,
installment payment or payment in the nature
of rent over and above the Rental payable
under this Lease), Tenant shall pay over to
Landlord one-half of any such payment, less
any amount paid to Landlord pursuant to
clause (E) above on account of any
construction allowance.
ARTICLE XVIII
SUBORDINATION AND ATTORNMENT
----------------------------
Section 18.1. Subordination.
--------------
Unless a Mortgagee (as hereinafter defined) shall otherwise elect as
provided in Section 18.2., Tenant's rights under this Lease are and shall remain
subject and subordinate to the operation and effect of
(a) any lease of land only or of land and buildings in a
sale-leaseback or lease-subleaseback transaction
involving the Premises or Landlord's interest therein,
or
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(b) any mortgage, deed of trust or other security
instrument constituting a lien upon the Premises or
Landlord's interest therein,
whether the same shall be in existence at the date hereof or created hereafter,
any such lease, mortgage, deed of trust or other security instrument being
referred to herein as a "Mortgage", and the party or parties having the benefit
of the same, whether as lessor, mortgagee, trustee or noteholder, being referred
to herein as a "Mortgagee". Tenant's acknowledgment and agreement of
subordination provided for in this Section are self-operative and no further
instrument of subordination shall be required; however, Tenant shall execute
such further assurances thereof as shall be requisite or as may be requested
from time to time by Landlord or any Mortgagee.
Section 18.2. Mortgagee's Unilateral Subordination.
-------------------------------------
If a Mortgagee shall so elect by notice to Tenant or by the recording
of a unilateral declaration of subordination, this Lease and Tenant's rights
hereunder shall be superior and prior in right to the Mortgage of which such
Mortgagee has the benefit, with the same force and effect as if this Lease had
been executed, delivered and recorded prior to the execution, delivery and
recording of such Mortgage, subject, nevertheless, to such conditions as may be
set forth in any such notice or declaration.
Section 18.3. Attornment.
-----------
If any person shall succeed to all or part of Landlord's interest in
the Premises, whether by purchase, foreclosure, deed in lieu of foreclosure,
power of sale, termination of lease or otherwise, and if so requested or
required by such successor in interest, Tenant shall attorn to such successor in
interest and shall execute such agreement in confirmation of such attornment as
such successor in interest shall reasonably request.
ARTICLE XIX
NOTICES
-------
Section 19.1. Sending of Notices.
-------------------
Any notice, request, demand, approval or consent given or required to
be given under this Lease shall be in writing and shall be deemed to have been
given as follows:
(i) if intended for Landlord, on the third day following
the day on which the same shall have been mailed by
United States registered or certified mail, or express
mail, return receipt requested, with all postage
charges prepaid, addressed to Landlord, Attention:
General Counsel, ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, with a copy to Landlord's
management office in the Shopping Center except that
payment of Rental and sales reports shall be delivered
to Landlord's management office in the Shopping
Center; and
(ii) if intended for Tenant, upon the earlier to occur of
the following:
(a) the third day following the day on which the
same shall have been mailed by United States
registered or certified mail or express
mail, return receipt requested, with all
postal charges prepaid, addressed to Tenant
at the Tenant Notice Address, or
(b) actual receipt at the Tenant Notice Address,
and in the event more than one copy of such
notice shall have been sent or delivered to
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Tenant, the first actually received shall
control for the purposes of this clause (b).
Either party may, at any time, change its address for the above
purposes by sending a notice to the other party stating the change and setting
forth the new address.
Section 19.2. Notice to Mortgagees.
---------------------
If any Mortgagee shall notify Tenant that it is the holder of a
Mortgage affecting the Premises, no notice, request or demand thereafter sent by
Tenant to Landlord shall be effective unless and until a copy of the same shall
also be sent to such Mortgagee in the manner prescribed in Section 19.1. and to
such address as such Mortgagee shall designate.
ARTICLE XX
MISCELLANEOUS
-------------
Section 20.1. Radius Restriction.
-------------------
Tenant agrees that Tenant (and if Tenant is a corporation or
partnership, its officers, directors, stockholders, any affiliates or partners)
shall not, directly or indirectly, operate, manage or have any interest in any
other store or business (unless in operation on the date of this Lease) which is
similar to or in competition with the Permitted Use on the Commencement Date of
this Lease and for the Term of this Lease within the Restriction Area. Without
limiting any of Landlord's remedies under this Lease, in the event Tenant
operates, manages or has any interest in a store or business violating the
provisions of this Section, then, at Landlord's option, Landlord may by notice
to Tenant require Tenant to include the gross sales of such other store or
business in the Gross Sales of the Premises for the purposes of calculating
Annual Percentage Rental under this Lease.
Section 20.2. Estoppel Certificates.
----------------------
At any time and from time to time, within ten (10) days after Landlord
shall request the same, Tenant will execute, acknowledge and deliver to Landlord
and to such Mortgagee or other party as may be designated by Landlord, a
certificate in an acceptable form with respect to the matters required by such
party and such other matters relating to this Lease or the status of performance
of obligations of the parties hereunder as may be reasonably requested by
Landlord. If Tenant fails to provide such certificate within ten (10) days after
request by Landlord, Tenant shall be deemed to have approved the contents of any
such certificate submitted to Tenant by Landlord and Landlord is hereby
authorized to so certify.
Section 20.3. Inspections and Access by Landlord.
-----------------------------------
Tenant will permit Landlord, its agents, employees and contractors to
enter all parts of the Premises during Tenant's business hours to inspect the
same and to enforce or carry out any provision of this Lease, including, without
limitation, any access necessary for the making of any repairs which are
Landlord's obligation hereunder; provided, however, that, in the event of an
emergency, Landlord may enter the Premises for such purposes at any time upon
such notice to Tenant, if any, as shall be feasible under the circumstances.
Section 20.4. Memorandum of Lease.
--------------------
Neither this Lease nor a short form or memorandum thereof shall be
recorded in the public records.
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Section 20.5. Remedies Cumulative.
--------------------
No reference to any specific right or remedy shall preclude Landlord
from exercising any other right or from having any other remedy or from
maintaining any action to which it may otherwise be entitled at law or in
equity. No failure by Landlord to insist upon the strict performance of any
agreement, term, covenant or condition hereof, or to exercise any right or
remedy consequent upon a breach thereof, and no acceptance of full or partial
rent during the continuance of any such breach, shall constitute a waiver of any
such breach, agreement, term, covenant or condition. No waiver by Landlord of
any breach by Tenant under this Lease or of any breach by any other tenant under
any other lease of any portion of the Shopping Center shall affect or alter this
Lease in any way whatsoever.
Section 20.6. Successors and Assigns.
-----------------------
This Lease and the covenants and conditions herein contained shall
inure to the benefit of and be binding upon Landlord, its successors and
assigns, and shall be binding upon Tenant, its successors and assigns and shall
inure to the benefit of Tenant and only such assigns and subtenants of Tenant to
whom the assignment of this Lease or subletting of the Premises by Tenant has
been consented to by Landlord as provided in this Lease. Upon any sale or other
transfer by Landlord of its interest in the Premises and in this Lease, and the
assumption by Landlord's transferee of the obligations of Landlord hereunder,
Landlord shall be relieved of all obligations under this Lease accruing
thereafter.
Section 20.7. Compliance with Laws and Regulations.
-------------------------------------
Tenant, at its sole cost and expense, shall comply, and shall cause the
Premises to comply with (a) all federal, state, regional, county, municipal and
other governmental statutes, laws, rules, orders, regulations and ordinances
affecting any part of the Premises, or the use thereof, including, but not
limited to, those which require the making of any structural, unforeseen or
extraordinary changes, whether or not any such statutes, laws, rules, orders,
regulations or ordinances which may be hereafter enacted involve a change of
policy on the part of the governmental body enacting the same, and (b) all
rules, orders and regulations of the National Fire Protection Association,
Landlord's casualty insurer(s) and other applicable insurance rating
organizations or other bodies exercising similar functions in connection with
the prevention of fire or the correction of hazardous conditions which apply to
the Premises.
Section 20.8. Captions and Headings.
----------------------
The table of contents and the Article and Section captions and headings
are for convenience of reference only and in no way shall be used to construe or
modify the provisions set forth in this Lease.
Section 20.9. Joint and Several Liability.
----------------------------
If two or more individuals, corporations, partnerships or other
business associations (or any combination of two or more thereof) shall sign
this Lease as Tenant, the liability of each such individual, corporation,
partnership or other business association to pay rent and perform all other
obligations hereunder shall be deemed to be joint and several and all notices,
payments and agreements given or made by, with or to any one of such
individuals, corporations, partnerships or other business associations shall be
deemed to have been given or made by, with or to all of them. In like manner, if
Tenant shall be a partnership or other business association, the members of
which are, by virtue of statute or federal law, subject to personal liability,
the liability of each such member shall be joint and several.
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Section 20.10. Broker's Commission.
--------------------
Each of the parties represents and warrants that there are no claims
for brokerage commissions or finders' fees in connection with the execution of
this Lease, and agrees to indemnify the other against, and hold it harmless
from, all liability arising from any such claim including, without limitation,
the cost of counsel fees in connection therewith.
Section 20.11. No Discrimination.
------------------
It is Landlord's policy to comply with all applicable state and federal
laws prohibiting discrimination in employment based on race, age, color, sex,
national origin, disability, religion, or other protected classification. It is
further intended that the Shopping Center shall be developed and operated so
that all prospective tenants thereof, and all customers, employees, licensees
and invitees of all tenants shall have equal opportunity to obtain all the
goods, services, accommodations, advantages, facilities and privileges of the
Shopping Center without discrimination because of race, age, color, sex,
national origin, disability, or religion. To that end, Tenant shall not
discriminate in the conduct and operation of its business in the Premises
against any person or group of persons because of the race, age, color, sex,
religion, national origin or other protected classification of such person or
group of persons.
Section 20.12. No Joint Venture.
-----------------
Any intention to create a joint venture or partnership relation between
the parties hereto is hereby expressly disclaimed. The provisions of this Lease
in regard to the payment by Tenant and the acceptance by Landlord of a
percentage of Gross Sales of Tenant and others is a reservation for rent for the
use of the Premises.
Section 20.13. No Option.
----------
The submission of this Lease for examination does not constitute a
reservation of or option for the Premises, and this Lease shall become effective
only upon execution and delivery thereof by both parties. Execution by signature
of an authorized officer of Landlord or any corporate entity acting on behalf of
Landlord shall be effective only upon attestation thereof and the affixation of
the seal of such corporation by a corporate Secretary or Assistant Secretary of
Landlord.
Section 20.14. No Modification.
----------------
This writing is intended by the parties as a final expression of their
agreement and as a complete and exclusive statement of the terms thereof, all
negotiations, considerations and representations between the parties having been
incorporated herein. No course of prior dealings between the parties or their
officers, employees, agents or affiliates shall be relevant or admissible to
supplement, explain, or vary any of the terms of this Lease. Acceptance of, or
acquiescence in, a course of performance rendered under this or any prior
agreement between the parties or their affiliates shall not be relevant or
admissible to determine the meaning of any of the terms of this Lease. No
representations, understandings, or agreements have been made or relied upon in
the making of this Lease other than those specifically set forth herein. This
Lease can be modified only by a writing signed by the party against whom the
modification is enforceable.
Section 20.15. Severability.
-------------
If any portion of any term or provision of this Lease, or the
application thereof to any person or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Lease, or the application of
such term or provision to persons or circumstances other than those
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as to which it is held invalid or unenforceable, shall not be affected thereby,
and each term and provision of this Lease shall be valid and be enforced to the
fullest extent permitted by law.
Section 20.16. Third Party Beneficiary.
------------------------
Nothing contained in this Lease shall be construed so as to confer upon
any other party the rights of a third party beneficiary except rights contained
herein for the benefit of a Mortgage.
Section 20.17. Corporate Tenants.
------------------
If Tenant is a corporation, the persons executing this Lease on behalf
of Tenant hereby covenant and warrant that: Tenant is a duly constituted
corporation qualified to do business in the State in which the Shopping Center
is located; all Tenant's franchises and corporate taxes have been paid to date;
all future forms, reports, fees and other documents necessary for Tenant to
comply with applicable laws will be filed by Tenant when due; and such persons
are duly authorized by the board of directors of such corporation to execute and
deliver this Lease on behalf of the corporation.
Section 20.18. Applicable Law.
---------------
This Lease and the rights and obligations of the parties hereunder
shall be construed in accordance with the laws of the State in which the
Shopping Center is located.
Section 20.19. Performance of Landlord's Obligations by Mortgagee.
---------------------------------------------------
Tenant shall accept performance of any of Landlord's obligations
hereunder by any Mortgagee of Landlord.
Section 20.20. Waiver of Certain Rights.
-------------------------
Landlord and Tenant hereby mutually waive any and all rights which
either may have to request a jury trial in any action, proceeding or
counterclaim (except for those involving personal injury or property damage)
arising out of this Lease or Tenant's occupancy of or right to occupy the
Premises.
Tenant further agrees that in the event Landlord commences any summary
proceeding for non-payment of rent or possession of the Premises, Tenant will
not interpose and hereby waives all right to interpose any counterclaim of
whatever nature in any such proceeding. Tenant further waives any right to
remove said summary proceeding to any other court or to consolidate said summary
proceeding with any other action, whether brought prior or subsequent to the
summary proceeding.
Section 20.21. Limitation on Right of Recovery Against Landlord.
-------------------------------------------------
Tenant acknowledges and agrees that the liability of Landlord under
this Lease shall be limited to its interest in the Shopping Center Area and any
judgments rendered against Landlord shall be satisfied solely out of the
proceeds of sale of its interest in the Shopping Center Area. No personal
judgment shall lie against Landlord upon extinguishment of its rights in the
Shopping Center Area and any judgment so rendered shall not give rise to any
right of execution or levy against Landlord's assets. The provisions hereof
shall inure to Landlord's successors and assigns including any Mortgagee. The
foregoing provisions are not intended to relieve Landlord from the performance
of any of Landlord's obligations under this Lease, but only to limit the
personal liability of Landlord in case of recovery of a judgment against
Landlord; nor shall the foregoing be deemed to limit Tenant's rights to obtain
injunctive relief or specific performance or to avail itself of any other right
or remedy which may be awarded Tenant by law or under this Lease.
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If Tenant claims or asserts that Landlord has violated or failed to
perform a covenant of Landlord not to unreasonably withhold or delay Landlord's
consent or approval, Tenant's sole remedy shall be an action for specific
performance, declaratory judgment or injunction and in no event shall Tenant be
entitled to any money damages for a breach of such covenant and in no event
shall Tenant claim or assert any claim for any money damages in any action or by
way of set off, defense or counterclaim and Tenant hereby specifically waives
the right to any money damages or other remedies.
Section 20.22. Survival.
---------
All representations, warranties, covenants, conditions and agreements
contained herein which either are expressed as surviving the expiration or
termination of this Lease or, by their nature, are to be performed or observed,
in whole or in part, after the termination or expiration of this Lease,
including (without limitation) the obligations of Tenant pursuant to Sections
8.6 and 13.1, shall survive the termination or expiration of this Lease.
Section 20.23. Relocation of Premises.
-----------------------
In the event of an expansion, renovation or remerchandising of the
Shopping Center in the vicinity of the Premises, Landlord may elect, by giving
notice of such election to Tenant, to require Tenant to surrender possession of
all or such portion of the Premises and for such period of time (including the
remainder of the Term) as Landlord, in its sole discretion, shall deem to be
required for such purposes. Such election shall be exercised not more than once
during the Term, except that if any such notice of election shall be withdrawn
by Landlord, the same shall be deemed not to have been given. Landlord's notice
of the exercise of such election shall designate (i) the portion of the Premises
required for such purposes, (ii) the period of time during which such surrender
shall be required, and (iii) the date by which possession of same shall be
surrendered by Tenant, which date shall not be earlier than ninety (90) days
after the date on which such notice is given.
If Tenant shall be required to surrender possession of all or a portion
of the Premises for a period of time which is less than the remainder of the
Term, Rental shall ▇▇▇▇▇ as to such portion or all of the Premises required to
be surrendered, such abatement to be effective beginning as of the date Tenant
is required to surrender such possession and continuing until the date on which
Landlord redelivers possession to Tenant. For purposes of determining the extent
of such abatement of Rental, Tenant's Floor Area hereunder shall be deemed to be
reduced during the abatement period by the number of square feet contained in
the portion of the Premises of which possession is required to be surrendered.
If Tenant shall be required to surrender possession of a portion of the
Premises for the entire remainder of the Term, this Lease shall terminate as to
such portion as of the date on which Tenant is required to surrender possession
thereof to Landlord and all Rental shall be proportionately reduced. For
purposes of determining the extent of such reduction of Rental, Tenant's Floor
Area hereunder shall be deemed to be reduced as of the date of such termination
by the number of square feet contained in the portion of the Premises of which
possession is required to be surrendered.
If Tenant shall be required to surrender possession of a portion of the
Premises, Landlord shall (a) provide any permanent or temporary barriers
required by the nature of Landlord's use of such portion, which barriers shall
be constructed in such a manner so as to not materially interfere with Tenant's
business operations in the Premises; and (b) make such alterations as may be
necessary in order to restore the remainder of the Premises to useful condition.
If Tenant shall be required to surrender possession of a portion of the
Premises and the remainder of the Premises shall be rendered unsuitable for the
Permitted Use, or if Tenant shall
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be required to surrender possession of the entire Premises, Landlord shall have
the further right and option to cause Tenant to relocate its business, within
ninety (90) days after notice to do so, to another location within the Shopping
Center Area, comparable in size and location to the Premises, mutually agreed
upon by Landlord and Tenant. Within sixty (60) days after any such notice shall
be given, Landlord and Tenant shall execute and deliver an amendment to this
Lease which shall substitute a description of the premises to which Tenant is to
be relocated for the description of the Premises contained herein and shall
modify Tenant's Floor Area accordingly; otherwise all of the terms and
conditions of this Lease shall be applicable to Tenant's occupancy of the new
premises.
If Landlord and Tenant cannot agree on a new location within such sixty
(60) days after notice of the exercise by Landlord of its relocation option
described in the preceding paragraph, then Landlord may elect to withdraw its
notice requiring Tenant to relocate its business, in which event Tenant shall
remain in possession of the Premises and this Lease shall remain in full force
and effect. If Landlord shall not elect to withdraw its notice requiring Tenant
to relocate its business, the Term shall terminate on the ninetieth (90th) day
after such notice, in which event Landlord agrees to pay to Tenant, provided
Tenant is not in default under this Lease, and provided Tenant shall have
furnished Landlord with the statement referred to in the last sentence of this
paragraph, an amount equivalent to the unamortized value of Tenant's leasehold
improvements which were installed in the Premises at Tenant's sole cost and
expense. Said amortization shall be determined on the straight-line depreciation
method allowed by the Internal Revenue Code of 1986 (as amended) assuming a
depreciation period commencing with the placement in service of such leasehold
improvements and ending on the date of expiration of the Term determined
pursuant to Section 3.1. Payment of the amount equivalent to the unamortized
value of Tenant's leasehold improvements will be made to Tenant within thirty
(30) days after Tenant shall have vacated the Premises in accordance with the
terms of this Lease, provided that Landlord shall have the right to deduct
therefrom any amounts due Landlord from Tenant pursuant to this Lease. For
purposes of this Section, "Tenant's leasehold improvements" shall include
partitioning, electrical wiring, plumbing (other than plumbing fixtures),
painting, wallpaper, storefront and other permanent improvements installed,
affixed or attached in or to the Premises, but shall not include (x) Tenant's
inventory or stock in trade, (y) such trade fixtures, electrical fixtures,
equipment or apparatus as are removable by Tenant at the expiration of the Term
pursuant to Article VII, or (z) Landlord's fixtures or other improvements
installed by or at the expense of Landlord. In order for Tenant to be entitled
to payment of the unamortized value of its leasehold improvements as set forth
in this paragraph, Tenant shall, within sixty (60) days after commencement of
the Term, furnish to Landlord a statement, signed by an independent certified
public accountant, setting out in detail the cost of Tenant's leasehold
improvements.
If this Lease shall be terminated as to any portion or all of the
Premises pursuant to this Section, the rights and obligations of the parties
hereunder shall cease as of the date specified herein and Rental (other than any
Additional Rental due Landlord by reason of Tenant's failure to perform any of
its obligations hereunder) shall be adjusted as of the date of such termination.
No further documentation shall be required to effect the termination of this
Lease, but each party agrees that, upon the written request of the other party
to do so, it shall execute, acknowledge and deliver an appropriate instrument
evidencing such termination prepared by or at the expense of the party
requesting the same.
Section 20.24. Landlord's Option to Terminate Lease.
-------------------------------------
Notwithstanding any provision herein to the contrary, if, for any
reason whatsoever the Premises shall not be Ready for Occupancy on or before
March 31, 1999, Landlord may elect to terminate this Lease by giving notice of
such election to Tenant. If such notice is given, this Lease and the rights and
obligations of the parties hereunder shall thereupon cease and terminate without
need for the execution of any further or other instrument but, if Landlord shall
request,
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Tenant shall execute an instrument, in recordable form, whereby Tenant releases
and surrenders all right, title and interest which it may have in and to the
Premises under this Lease or otherwise.
Section 20.25. Financing Contingency.
----------------------
Landlord reserves the right to terminate this Lease unless Tenant, no
later than one hundred twenty (120) days before the Grand Opening Date, supplies
Landlord with documentation reasonably satisfactory to Landlord evidencing
Tenant's financial ability to complete the construction of and the improvements
to the Premises in accordance with the provisions of this Lease. If Tenant does
not supply Landlord with such documentation by such date, Landlord may terminate
this Lease by giving Tenant notice of such termination no later than the latter
to occur of (i) commencement of Tenant's construction within the Premises or
(ii) thirty (30) days before the Grand Opening Date. Upon the giving of said
notice of termination, Landlord and Tenant shall be relieved of all obligations
and shall be completely discharged and released from all liabilities, claims,
rights or causes of action hereunder.
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IN WITNESS WHEREOF, the parties hereto intending to be legally bound
hereby have executed this Lease under their respective hands and seals as of the
day and year first above written.
WITNESS: ▇▇▇▇▇-▇▇▇▇▇▇▇, INC., Landlord
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
WITNESS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (SEAL)
----------------------------- ------------------------------
Vice-President
WITNESS: ATTEST:
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
WITNESS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------- ------------------------------
Assistant Secretary
(CORPORATE SEAL)
WITNESSES (AS TO BOTH): CIAO CUCINA CORP., Tenant
/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ (SEAL)
----------------------------- ------------------------------
President
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ATTEST:
-----------------------------
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Secretary
(CORPORATE SEAL)
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If Tenant is a corporation, the authorized officers must sign on behalf
of the corporation, and by doing so such officers make the covenants and
warranties contained in Section 20.17 hereof. The Lease must be executed for
Tenant, if a corporation, by the president or vice-president and be attested by
the secretary or the assistant secretary, unless the by-laws or a resolution of
the board of directors shall provide that other officers are authorized to
execute the Lease, in which event, a certified copy of the by-laws or
resolution, as the case may be, must be furnished. Tenant's corporate seal must
be affixed.
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RIDER TO LEASE
--------------
THIS RIDER is annexed to and forms part of the Lease dated July 7,
1997, between ▇▇▇▇▇-▇▇▇▇▇▇▇, INC., a Maryland corporation as Landlord, and CIAO
CUCINA CORP., an Ohio corporation, t/a CIAO CUCINA, as Tenant.
The printed part of the Lease is hereby modified and
supplemented as follows. Wherever there is any conflict
between this Rider and the Lease, the provisions of this Rider
are paramount and the Lease shall be construed accordingly.
SECTION 1.1. (The printed Section deals with Certain Defined Terms):
T. Add the following to the end of the printed Section 1.1.T.:
"Landlord's Qualifying Floor Area shall never be less than eighty
percent (80%) of Landlord's Floor Area."
SECTION 3.2. (The printed Section deals with Termination):
Add the following to the end of the printed Section 3.2.:
"Provided Tenant is not in default under any of the terms, covenants
and conditions of this Lease, Tenant shall have the option to renew the Term of
this Lease for one (1) additional period of five (5) consecutive Rental Years
('Renewal Term') upon the same terms and conditions as this Lease, except: (i)
Annual Basic Rental for the Renewal Term shall be Forty Dollars ($40.00) per
square foot of the Premises per annum, and (ii) Annual Percentage Rental for the
Renewal Term shall be six percent (6%) of Gross Sales in excess of $666.66
multiplied by the Floor Area of the Premises. Tenant shall have no further
option to renew.
"In order to exercise the option herein provided, Tenant shall notify
Landlord in writing, time being of the essence, at least six (6) months prior to
the end of the last Rental Year of the original Term hereof. Tenant's failure to
so notify Landlord timely shall be considered a forfeiture by Tenant of this
option to renew."
SECTION 4.3. (The printed Section deals with Tenant Trade Name):
Add the following to the end of the printed Section 4.3.:
"Landlord will not unreasonably withhold its consent to a change in
Tenant Trade Name provided the majority of Tenant's stores operating under the
same Tenant Trade Name in the southeastern region of the United States at the
time of such name change shall be changing their trade name to the same new
trade name as the new trade name being requested for the Premises, and such
other trade name will not conflict with, and is not likely to confuse the public
regarding, the trade names of other tenants in the Shopping Center. Within
thirty (30) days of a permitted change in Tenant Trade Name, Tenant agrees, at
its sole cost and expense, to replace its storefront sign to reflect the new
Tenant Trade Name. Plans and specifications for such storefront sign must be set
forth in detail and submitted to Landlord for approval prior to installation of
said sign."
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54
SECTION 4.4. (The printed Section deals with Store Hours):
Add the following to the end of the printed Section 4.4.:
"Notwithstanding anything to the contrary contained in the printed
Section 4.4., Tenant shall have the right to remain open for business in the
Premises for a greater period of time than the operating hours set forth in the
printed Section 4.4. provided that Tenant shall give Landlord advance written
notice of such greater operating hours, and Tenant shall pay for any additional
costs incurred by Landlord during such greater operating hours as provided in
the second paragraph of the printed Section 4.4."
SECTION 5.1. (The printed Section deals with Rentals Payable):
Add the following to the end of the printed Section 5.1.:
"Notwithstanding anything to the contrary contained in this Section
5.1., Tenant shall not be required to pay Annual Basic Rental from the
Commencement Date through the later to occur of (i) the ninetieth (90th) day of
the Term, or (ii) the first day the movie theatre is open for business in the
Shopping Center (the "Abatement Period"), but shall be required to pay all other
Rental. Commencing on the later to occur of (i) the ninety-first (91st) day of
the Term, (ii) the second day the movie theater is open for business in the
Shopping Center and continuing through the remainder of the Term, Tenant shall
be obligated for the full payment of all Rental due under this Lease. This
provision shall not be construed to otherwise waive Landlord's rights under
Section 5.8. If Tenant defaults under this Lease and as a result thereof
Landlord terminates this Lease during the first five (5) Rental Years of the
Term, all Annual Basic Rental which would have been payable to Landlord during
the Abatement Period shall immediately become due and payable."
SECTION 5.3. (The printed Section deals with Annual Percentage Rental):
Delete the printed Section 5.3. in its entirety and insert in lieu
thereof the following:
"Tenant shall be under no obligation to make any payments of Annual
Percentage Rental in any Rental Year until Tenant has achieved the Breakpoint
set forth in Section 1.l.H. of this Lease for that Rental Year. Upon achieving
such Breakpoint in any Rental Year, Tenant shall thereupon make monthly payments
of Annual Percentage Rental payable on or before the fifteenth (15th) day
following the close of each full calendar month during the Term, based on Gross
Sales for such period. Monthly payments of Annual Percentage Rental shall be
calculated by multiplying the amount of Gross Sales for the month in question by
the percentage specified in Section 1.1.H., the first such payment to include
also any prorated Annual Percentage Rental for the period from the date Tenant's
Gross Sales reach the Breakpoint set forth in Section 1.1.H. to the first day of
the next full calendar month in the Term. If necessary, as soon as practicable
after the end of each Rental Year, the Annual Percentage Rental paid or payable
for such Rental Year shall be adjusted between Landlord and Tenant, each party
hereby agreeing to make such adjustment and to pay to the other, on demand, such
amount as may be necessary to effect adjustment to the agreed Annual Percentage
Rental."
SECTION 5.5. (The printed Section deals with "Gross Sales" Defined):
Add the following to the end of the printed Section 5.5.:
"In addition to the exclusions set forth in the second paragraph of
this printed Section 5.5., and notwithstanding anything to the contrary
contained in Section 5.5., Gross Sales shall not include, to the extent that any
purchase was previously included in Gross Sales, bad debts not in excess of one
percent (1%) of Gross Sales in any one Rental Year (provided, however, that if
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Tenant subsequently receives payment on any account heretofore excluded, such
payment shall be included in Gross Sales for the Rental Year in which
received)."
SECTION 5.6. (The printed Section deals with Statements of Gross
Sales):
Add the following to the end of the printed Section 5.6.:
"Tenant's 'retail month' consists of successive periods of 4 weeks.
Wherever reference is made in this Lease to month or monthly, it shall be deemed
to refer to the artificial month of 4 weeks, as the case may be, except that
monthly installments of Annual Basic Rental and Additional Rental shall be
payable on the first day of each calendar month."
SECTION 5.9. (The printed Section deals with Advance Rental):
Delete the printed Section 5.9. in its entirety.
SECTION 5.10. (The printed Section deals with Future Expansion):
Delete the printed Section 5.10. in its entirety.
SECTION 6.1. (The printed Section deals with Tenant to Pay
Proportionate Share of Taxes):
Add the following phrase after the word "special" in the third line of
the printed Section 6.1:
"including Dovera Community Development District assessments".
Delete the words "Landlord's Floor Area" appearing in the fourteenth
line of the printed Section 6.1., and insert "Landlord's Qualifying Floor Area"
in lieu thereof.
SECTION 7.2. (The printed Section deals with Tenant's Improvements):
After the word "improvements," in the eleventh line of the printed
Section 7.2., insert the word "and".
Insert a period after the number "13.4." in the twelfth line of the
printed Section 7.2. and delete the remainder of the sentence.
Add the following to the end of the printed Section 7.2.:
"Notwithstanding anything to the contrary contained in the printed
Section 7.2., Landlord shall arrange for the construction of improvements to the
Premises required of Tenant pursuant to Sections C and D of Schedule B, as more
particularly described in Rider to Schedule B; which work shall be at Landlord's
expense. Any work to be performed by Landlord for Tenant shall be done in
accordance with Tenant's approved plans; any changes to said plans shall be
subject to Tenant's approval, said approval not to be unreasonably withheld.
"After Tenant's plans and specifications have been approved, but prior
to the commencement of Tenant's contractor beginning its work in the Premises,
Tenant shall provide Landlord with an affidavit signed by Tenant and Tenant's
chief financial officer stating that Tenant has sufficient funds reserved to
complete the construction of the Premises."
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56
SECTION 8.2. (The printed Section deals with Signs and Advertising):
Delete the words "without first obtaining Landlord's approval" in the
fifth line of the printed Section 8.2. and insert the following in lieu thereof:
"unless the same is placed and maintained in accordance with the terms of that
portion of Schedule C headed 'Sign Criteria'".
SECTION 9.4. (The printed Section deals with Alterations by Tenant):
Add the following at the end of the printed Section 9.4.:
"Prior to the expiration of the eleventh Rental Year of the Term,
Tenant agrees, at its sole cost and expense, to remodel the interior and
exterior of the Premises in accordance with approved plans and specifications,
using new and quality materials and equipment. Plans and specifications for all
improvements, including the type of materials to be used by Tenant in the
Premises, must be set forth in detail and submitted to Landlord for approval
prior to the commencement of such remodeling. Tenant agrees to commence
remodeling of the Premises promptly upon approval by Landlord of such plans and
specifications.
SECTION 9.5. (The printed Section deals with Changes and Additions to
Shopping Center):
Add the following phrase after the word "reduce" in the eleventh line
of the printed Section 9.5.:
"Landlord's Floor Area required for the determination of the date on
which the Premises are Ready for Occupancy as described in clause (d) of Section
7.3, or"
Add the following to the end of the printed Section 9.5:
"Any changes or additions by Landlord to the Shopping Center Area shall
be performed in such a manner so as not to unreasonably interfere with Tenant's
use of the Premises and shall not change in a material, adverse way the access
to the Premises from the Common Areas adjacent to the Premises."
SECTION 10.6. (The printed Section deals with Mall Heating, Ventilating
and Air-Conditioning Equipment Contribution Rate):
Delete the printed Section 10.6. in its entirety, and insert the
following in lieu thereof:
"The Mall Heating, Ventilating and Air-Conditioning Equipment
Contribution shall be included with the HVAC Equipment Contribution Rate
provided for in Section 1.1.J. of this Lease."
SECTION 10.7. (The printed Section deals with Renovation or Expansion
of Common Areas):
Delete the printed Section 10.7. in its entirety.
SECTION 11.5. (The printed Section deals with Advertising):
Delete the printed Section 11.5. and insert the following in lieu
thereof:
"During each Rental Year, Tenant shall advertise its business at the
Premises by expending an amount which shall be not less than Six Thousand Five
Hundred Dollars ($6,500) for such period in recognized regional print or
electronic advertising media. Tenant shall preserve original or duplicate books
and records at Tenant's Notice Address which shall disclose all information
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57
required to determine Tenant's advertising expenditures. Upon advance notice,
Landlord, its agents and accountants, shall have the right to audit such books
and records. If the audit discloses noncompliance by Tenant for any Rental Year
in question, Tenant, in addition to the remedies contained in this Lease, shall
pay to Landlord a sum equal to Landlord's cost of the audit, which sum shall be
deemed to be Additional Rental."
SECTION 13.3. (The printed Section deals with Tenant's Insurance):
Delete the phrase "At all times on and after delivery of the Premises
to Tenant" in the first line of the printed Section 13.3. and insert the
following: "At all times after the Premises are released to Tenant for
construction of its improvements" in lieu thereof.
SECTION 13.8. (The printed Section deals with Tenant to Pay
Proportionate Share of Insurance Costs):
Delete the words "Landlord's Floor Area" appearing in the third line of
the second paragraph of the printed Section 13.8., and insert "Landlord's
Qualifying Floor Area" in lieu thereof.
SECTION 14.1. (The printed Section deals with Landlord's Obligation to
Repair and Reconstruct):
Delete the words "; provided, however, that," after the word "Landlord"
in the twelfth line of the printed Section 14.1. and insert the following in
lieu thereof: ", but Landlord shall not be required to perform any work beyond
that described in Sections A and B of Schedule B".
SECTION 14.2. (The printed Section deals with Landlord's Option to
Terminate Lease):
Add the following at the end of the printed Section 14.2.:
"If Landlord's Building is damaged by Casualty to the extent of fifty
percent (50%) or more of Landlord's Floor Area, and Landlord does not commence
reconstruction of Landlord's Building within one (1) year after the date of such
Casualty, Tenant may terminate this Lease by giving Landlord notice of such
termination within thirty (30) days after the end of such one (1) year period,
in which event, subject to Section 20.22. hereof, both parties will be relieved
of all obligations under this Lease except those obligations occurring or
accruing prior to the date of such termination.
"Tenant shall have the right to terminate this Lease if the Premises
are damaged in whole or in part and are thereby rendered untenantable during the
last three (3) years of the Term, by giving Landlord written notice of such
termination within thirty (30) days after the date of such Casualty. If Tenant
so terminates this Lease both parties, subject to Section 20.22. hereof, will be
relieved of all obligations under this Lease except those obligations occurring
or accruing prior to the date of such termination."
SECTION 16.2. (The printed Section deals with Transfer of Corporate
Shares):
After the words "Securities Exchange Act of 1934" in the second line of
the printed Section 16.2., add the words "or traded over-the-counter".
SECTION 17.1. (The printed Section deals with "Event of Default"
Defined):
(i) Delete the period at the end of the printed Section 17.1.(i) and
add the words ", which default is not cured within ten (10) days after notice
thereof by Landlord, unless such default is of such nature that it cannot be
cured within such ten (10) day period, in which case no Event
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58
of Default shall occur so long as Tenant shall commence the curing of the
default within such ten (10) day period and shall thereafter diligently
prosecute the curing of same."
SECTION 20.2. (The printed Section deals with Estoppel Certificates):
Delete the words "an acceptable form" in the third line of the printed Section
20.2. and insert the words "a form requested by Landlord or in the form attached
hereto as Schedule D" in lieu thereof.
Delete the words "required by such party" in the third and fourth lines
of the printed Section 20.2. and insert the words "set forth in Schedule D" in
lieu thereof.
SECTION 20.10. (The printed Section deals with Broker's Commission):
Add the following to the end of the printed Section 20.10.:
"Notwithstanding anything to the contrary contained in this Section
20.10., Landlord, at its sole cost and expense, has engaged a brokerage firm
with regard to this Lease and the Premises leased hereby. Any fee or commission
shall be the sole responsibility of Landlord."
SECTION 20.21. (The printed Section deals with Limitation on Right of
Recovery Against Landlord):
Delete the second paragraph of the printed Section 20.21.
SECTION 20.23 (The printed Section deals with Relocation of Premises):
The printed Section 20.23. is hereby deleted in its entirety.
SECTION 20.24. (The printed Section deals with Landlord's Option to
Terminate):
After the word "Landlord" in the second line of the printed Section
20.24., add the words "or Tenant".
Delete the word "Tenant." in the third line of the printed Section
20.24. and insert in lieu thereof the words "the other party."
SECTION 20.25. (The printed Section deals with Financing Contingency):
Delete the printed Section 20.25.
THIS LEASE AGREEMENT CONTAINS IN SECTION 20.20. A MUTUAL WAIVER BY THE
PARTIES OF THE RIGHT TO A JURY TRIAL IN CERTAIN ACTIONS BETWEEN THE PARTIES.
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IN WITNESS WHEREOF, the parties hereto intending to be legally bound
hereby have executed this Lease under their respective hands as of the day and
year first above written.
WITNESS: ▇▇▇▇▇-▇▇▇▇▇▇▇, INC., Landlord
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
WITNESS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (SEAL)
----------------------------- ------------------------------
Vice-President
WITNESS: ATTEST:
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------
WITNESS:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------- ------------------------------
Assistant Secretary
(CORPORATE SEAL)
WITNESSES (AS TO BOTH): CIAO CUCINA CORP., Tenant
/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ (SEAL)
----------------------------- ------------------------------
President
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ATTEST:
-----------------------------
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Secretary
(CORPORATE SEAL)
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