Arby's/Sbarro, Site #6910, Xxxx Rapids, Anoka County, Minnesota
LEASE AGREEMENT
THIS LEASE AGREEMENT is made and entered into as of February
20, 2001, by and between:
(i) CNL RESTAURANT INVESTORS PROPERTIES, LLC, a
Delaware limited liability company, with principal
office and place of business at CNL Center at City
Commons, 000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
00000-0000 ("Landlord"), and
(ii) FRANCHISE ASSOCIATES, INC., a Minnesota
corporation, with a mailing address of 0000
Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxxx, Xxxxxxxxx
00000 ("Tenant").
W I T N E S S E T H:
Landlord leases to Tenant, for the purpose of operating an
Arby's/Sbarro Restaurant and for no other use or purpose
whatsoever and subject to the terms and conditions of the Rent
Addendum attached hereto, and Tenant rents from Landlord the
following described premises, (hereinafter "Premises") located at
0000 000xx Xxxxxx XX, Xxxx Xxxxxx, Xxxxx Xxxxxx, Xxxxxxxxx and
being more particularly described in Exhibit "A" attached hereto
and made a part hereof, together with all rights and privileges
in and about the Premises as may be necessary or convenient to
Tenant's business, inclusive of all easements benefiting the real
property described in Exhibit "A". Premises shall include all
improvements and structures whether now existing or hereafter
constructed thereon.
The following additional stipulations are hereby declared to
be covenants of this Lease and shall, unless otherwise expressly
stated, be applicable at all times throughout the term of this
Lease and any extension or renewal thereof:
1. DEFINITIONS
For purposes of this Lease, the following terms shall have
the definitions ascribed to them:
"Annual Rent Commencement Date" shall be February 20, 2001.
"Effective Date" shall mean the date set forth at the
beginning of this Lease.
"Franchisor" shall mean Arby's, d/b/a Triarc Restaurant
Group, Inc., a Delaware corporation, its successors and assigns,
and Sbarro, Inc., a New York corporation, its successors and
assigns.
"Landlord" shall mean CNL Restaurant Investors Properties,
LLC, a Delaware limited liability company, its successors and
assigns.
"Lease" shall include this Lease Agreement and all
amendments hereto, if any, entered into from time to time
hereafter, together with the Rent Addendum and exhibits attached
hereto.
"Lease Year" shall mean a fiscal period beginning on the
Annual Rent Commencement Date (and each anniversary thereof) and
expiring on the last day of the twelfth (12th) month thereafter.
In the event the Annual Rent Commencement Date is not the first
(1st) day of a calendar month, then the Lease Year shall commence
on the first (1st) day of the calendar month following the Annual
Rent Commencement Date.
"Rent" shall mean the Rent payable under this Lease as set
forth in the Rent Addendum attached hereto and incorporated
herein, and shall include Annual Rent and Percentage Rent ( all
as defined in the Rent Addendum), together with all other items
described in this Lease as "additional rent".
"Tenant" shall include the named Tenant and any assignee or
sublessee thereof pursuant to an assignment or sublease under
Paragraph 17 of this Lease.
"Total Cost" shall mean $1,288,536.46.
2. TERM AND RENT
(A) TERM. The term of this Lease shall begin on the Effective
Date and shall expire on February 28, 2021 (hereinafter the
"Termination Date"), unless previously terminated or renewed or
extended as provided herein.
(B) RENT. Rent shall be due and payable as provided in the Rent
Addendum attached hereto and incorporated herein.
3. ALTERATIONS AND IMPROVEMENTS, INVESTMENT TAX CREDIT,
MECHANIC'S LIENS, LANDLORD'S DISCLAIMER
(A) ALTERATIONS AND IMPROVEMENTS.
(I) TENANT'S PROPERTY. Tenant shall be permitted to install,
use on and about, and remove from the Premises at any time and
from time to time all trade fixtures and other personal property
(exclusive of lighting, electrical, and heating and air
conditioning improvements) which are not a component of the
building located or to be located on the Premises (hereinafter
referred to as the "Tenant's Property"), all of which at all
times shall remain the property of Tenant with the right of
removal (subject to subparagraph (d) below) at the expiration of
this Lease. Tenant's Property shall include: (1) removable
decor items, tables, trim, lighting, planters, trash units,
cabinets and office equipment; (2) building lettering, signs,
sign posts and sign standards; (3) unattached food and customer
service equipment; (4) food and customer service equipment
attached to the building by bolts and screws and/or by utility
connections, including without limitation, walk-in refrigerators
and freezers, remote refrigeration systems, exhaust systems and
hoods; and (5) those items described in Exhibit "B" attached
hereto. Tenant shall be responsible for promptly repairing any
damage to the Premises caused by removal of any of Tenant's
Property.
(II) SUBSEQUENT IMPROVEMENTS. Tenant shall also have the right
to make any additions, alterations, changes and improvements,
structural and nonstructural, including but not limited to
construction of additional buildings and additions to the then
existing buildings, as Tenant shall desire; provided, however,
(i) Tenant shall submit plans of all structural changes to
Landlord at least thirty (30) days in advance of the proposed
construction date, which plans shall be subject to the Landlord's
approval, (ii) Tenant shall provide Landlord with evidence of
Tenant's financial ability to pay for such structural changes,
(iii) all such construction shall be completed in a workmanlike
manner and in full compliance with all laws, building codes and
ordinances applicable thereto, at Tenant's sole expense, and (iv)
such additions, alterations, changes and improvements (whether
structural or non-structural) shall not reduce the fair market
value of the Premises, as determined by Landlord.
(III) IMPROVEMENTS UPON TERMINATION, SUBLETTING OR
ASSIGNMENT. Subject to the requirements of this paragraph 3,
Tenant shall have the right, at its option and expense, to
redecorate or otherwise remodel the Premises upon any termination
hereof or upon subletting or assignment in such manner as will,
without reducing the fair market value thereof, avoid the
appearance of the Arby's Restaurant operated under this Lease;
provided, however, in addition to the other requirements of this
paragraph 3, Tenant shall not impair the structural condition of
the Premises or reduce the size of the Premises.
(iv) All Subsequent Improvements referred to in subparagraph
3(a)(ii) above, all improvements upon termination, subletting or
assignment referred to in subparagraph 3(a)(iii) above, and any
and all other additions, alterations, changes and improvements of
any type shall be deemed to be a part of the Premises and the
sole property of Landlord.
(B) INVESTMENT TAX CREDIT. Landlord hereby grants Tenant the
right and privilege of applying for and receiving all investment
tax credits, if any, under the Internal Revenue Code which may be
available with respect to the building and other improvements to
be constructed. To this end, Landlord agrees to execute all such
further documents and supply such additional information as may
be required to make such election effective.
(C) MECHANIC'S AND OTHER LIENS. Tenant shall not do or suffer
anything to be done whereby the Premises, or any part thereof,
may be encumbered by a mechanic's, materialman's, or other liens
for work or labor done, services performed, materials,
appliances, or power contributed, used, or furnished in or to the
Premises or in connection with any operations of Tenant, or
similar lien, and, if, whenever and as often as any mechanic's
lien or similar lien is filed against the Premises, or any part
thereof, purporting to be for or on account of any labor done,
materials or services furnished in connection with any work in or
about the Premises, done by, for or under the authority of
Tenant, or anyone claiming by, through or under Tenant, Tenant
shall discharge the same of record within thirty (30) days after
service upon Tenant of notice of the filing thereof; provided,
however, Tenant shall have the right to remove the lien by
bonding same in accordance with applicable law and to contest any
such lien; provided further that Tenant shall diligently
prosecute any such contest, at all times effectively staying or
preventing any official or judicial sale of the Premises under
execution or otherwise, and, if unsuccessful, satisfy any final
judgment against Tenant adjudging or enforcing such lien or, if
successful, procuring record satisfaction or release thereof.
(D) LANDLORD'S DISCLAIMER. All of Tenant's Property placed in
or upon the Premises by Tenant shall remain the property of
Tenant with the right to remove the same at any time during the
term of this Lease. Landlord, if requested by Tenant, agrees to
execute such documentation as may be reasonably required to (i)
subordinate its landlord's lien in Tenant's Property to the
interest of any unaffiliated lender for Tenant's Property; (ii)
release its landlord's lien in Tenant's Property if Tenant
finances Tenant's Property with an unaffiliated lender and such
lender will not agree to Landlord having a subordinate landlord's
lien in Tenant's Property; and (iii) release its landlord's lien
in Tenant's Property if Tenant's Property is conveyed by Tenant
to a third party for the purpose of leasing Tenant's Property to
Tenant. The foregoing release and subordinations shall all be in
recordable form. In the event Tenant's Property is removed from
or relocated on the Premises, any damage caused by, or resulting
from the removal or relocation of any of Tenant's Property or
other personal property shall be promptly repaired by Tenant or
the party entitled to remove same. In the event that the form of
waiver documentation is not similar in form and content to that
attached hereto as Exhibit "C," then Landlord shall be entitled
to charge a reasonable fee (not to exceed Five Hundred Dollars
($500.00) per transaction) in connection with execution of such
documentation, and Tenant agrees to pay such fee as a condition
precedent to Landlord's execution of such documents.
4. DESTRUCTION OF PREMISES; INSURANCE
(a) If the Premises are damaged or destroyed by fire, flood,
tornado or other element, or by any other casualty and such
damage or destruction does not occur within the last twenty-four
(24) months of the original or of any extended or renewed term of
this Lease, this Lease shall continue in full force and effect
and Tenant shall, as promptly as possible, restore, repair or
rebuild the Premises to substantially the same condition as it
existed before the damage or destruction, including any
improvements or alterations required to be made by any
governmental body, county or city agency, due to any changes in
code or building regulations. Tenant shall for this purpose use
all, or such part as may be necessary, of the insurance proceeds
received from insurance policies required to be carried under the
provision of subparagraph 4(b) hereinbelow. If such insurance
proceeds are not sufficient to pay such costs, Tenant shall pay
such deficit. Should the Premises be damaged or destroyed by any
of the foregoing described casualties within the last twenty-four
(24) months of the original term or of any extended or renewed
term of this Lease, then to the extent that the Premises are
untenantable or unsuitable, in Tenant's reasonable opinion, for
continued use in the normal conduct of Tenant's business, Tenant
shall have the right, exercisable by written notice to Landlord
given within thirty (30) days after the date of such damage or
destruction, to terminate this Lease effective upon the date of
such damage or destruction. If Tenant terminates this Lease as
thus provided Landlord shall be entitled to all of the insurance
proceeds on the Premises, but not to the proceeds of insurance
carried by Tenant on Tenant's Property; provided, however, Tenant
shall not have the right to terminate this Lease unless (i) the
damage or destruction of the Premises was caused by a peril which
was insured against as required by the provisions of subparagraph
4(b) of this Lease; (ii) at the time of such damage and
destruction the said insurance policies to be carried by Tenant
were in the amount of the full replacement cost of such
improvements (without deduction or co-insurance) and in full
force and effect; and (iii) the insurer has confirmed coverage
and its obligation to pay. If Tenant defaults in its obligation
to carry insurance in the amounts required under subparagraph
4(b), then, prior to Tenant's termination of this Lease and in
addition to the requirements set forth in the preceding sentence,
Tenant shall be obligated to pay toward said reconstruction or to
Landlord the difference between the amount of insurance actually
carried and the amount required to be carried under this
paragraph 4.
(b) Tenant, at its expense and as additional rent hereunder,
shall throughout the term of this Lease and any extension or
renewal thereof, keep the Premises insured with (i) "Special Form
Causes of Loss" coverage (as such term is used in the insurance
industry), at least as broad as ISO Special Form Causes of Loss,
CP0030, including coverage for glass breakage, vandalism and
malicious mischief, and builder's risk (if the Premises are to be
constructed pursuant to the terms of this Lease) for one hundred
percent (100%) insurable replacement value with no co-insurance
penalty, with any deductible in excess of Fifty Thousand Dollars
($50,000.00) to be approved by Landlord and, (ii) "Ordinance and
Law Coverage" with limits of not less than the building value for
Coverage A (loss to the undamaged portion of the building),
limits of not less than fifteen percent (15%) of the building
value for Coverage B (Demolition Cost Coverage), and limits not
less than fifteen percent (15%) of the building value for
Coverage C (Increased Cost of Construction Coverage).
(c) Tenant shall maintain throughout the term of this Lease and
any extension thereof, at its own expense and as additional Rent,
Commercial General Liability insurance including Product
Liability and Liquor Liability (if alcohol is served) covering
the Premises at least as broad as the most commonly available ISO
Commercial General Liability policy form CG0001 (occurrence
basis) covering bodily injury, property damage and personal and
advertising injury, for the joint benefit of and insuring Tenant
and Landlord, with limits not less than One Million Dollars
($1,000,000.00) per occurrence, with a General Aggregate of not
less than Two Million Dollars ($2,000,000.00) and a "following
form" Umbrella Liability policy or Excess Liability policy to
include Product Liability and Liquor Liability (if alcohol is
served), in an amount of not less than Ten Million Dollars
($10,000,000.00) per occurrence, with any deductible in excess of
Fifty Thousand Dollars ($50,000.00) to be approved by Landlord.
(d) Tenant shall maintain throughout the term of this Lease and
any extension thereof, at its own expense, Business Interruption
insurance covering risk of loss due to the occurrence of any of
the hazards insured against under Tenant's "all risk" coverage
insurance and providing coverage in an amount sufficient to
permit the payment of rents, taxes, insurance and operating
expenses payable hereunder for a period (in such case) of not
less than six (6) months.
(e) In the event the Premises are located in an area identified
by the National Flood Insurance Program as an area having
"special flood hazards" (zones beginning with "A" or "V," Tenant
shall maintain throughout the term of this Lease and any
extension thereof, flood insurance for the full replacement value
of the Premises, with any deductible in excess of Fifty Thousand
Dollars ($50,000.00) to be approved by Landlord.
(f) In the event the Premises are located in a major earthquake
damage area and earthquake insurance is available, Tenant shall
maintain throughout the term of this Lease and any extension
thereof earthquake insurance for the full replacement value of
the Premises, with any deductible in excess of Fifty Thousand
Dollars ($50,000.00) to be approved by Landlord.
(g) All insurance companies providing the coverage required
under this Paragraph 4 shall be selected by Tenant and shall be
rated A minus (A-) or better by Best's Insurance Rating Service,
shall be licensed to write insurance policies in the state in
which the Premises is located, and shall be acceptable to
Landlord in Landlord's reasonable discretion. Tenant shall
provide Landlord with copies of all policies or certificates of
such coverage for the insurance coverages referenced in this
paragraph 4, and all Commercial General Liability and Umbrella
Liability or Excess Liability policies shall name Landlord (and
if Landlord is either a general or limited partnership, all
general partners) and any mortgagee designated by Landlord as an
additional insured. Any such coverage for additional insureds
shall be primary and non-contributory with any insurance carried
by Landlord or any other additional insured hereunder. All
property insurance policies shall name Landlord as an additional
insured or as a loss payee as Landlord's interests may appear,
and shall provide that all losses shall be payable as herein
provided. All such policies of insurance shall provide that the
amount thereof shall not be reduced and that none of the
provisions, agreements or covenants contained therein shall be
modified or canceled by the insuring company or companies without
thirty (30) days prior written notice being given to Landlord;
and that all insurance proceeds shall be paid by check jointly
payable to Landlord and Tenant. Such policy or policies of
insurance may also cover loss or damage to Tenant's Property, and
the insurance proceeds applicable to Tenant's Property shall not
be paid to Landlord or any mortgagee but shall accrue and be
payable solely to Tenant. In the event of a casualty, Tenant
shall be responsible for any deficiency between the replacement
cost of the Premises and the amount actually paid by the
insurance company.
5. MAINTENANCE AND REPAIR
(a) Tenant shall maintain the Premises and all buildings and
improvements thereon (interior and exterior, structural and
otherwise) in good order and repair and, subject to the
provisions of subparagraph 4(a) with respect to damage within the
last twenty-four (24) months of the Lease, and paragraph 6
herein, return the Premises and all buildings and improvements
thereon at the expiration of the term of this Lease or any
extension thereof in as reasonably as good condition as when
received, ordinary wear and tear excepted.
(b) Tenant agrees that Landlord shall have no obligation under
this Lease to make any repairs or replacements (including the
replacement of obsolete components) to the Premises or the
buildings or improvements thereon, or any alteration, addition,
change, substitution or improvement thereof or thereto, whether
structural or otherwise. The terms "repair" and "replacement"
include the replacement of any portions of the Premises which
have outlived their useful life during the term of the Lease (or
any extensions thereof). Landlord and Tenant intend that the
Rent received by Landlord shall be free and clear of any expense
to Landlord for the construction, care, maintenance (including
common area maintenance charges and charges accruing under
easements or other agreements relating to the Premises),
operation, repair, replacement, alteration, addition, change,
substitution and improvement of or to the Premises and any
building and improvement thereon. Upon the expiration or earlier
termination of this Lease, Tenant shall remain responsible for,
and shall pay to Landlord, any cost, charge or expense for which
Tenant is otherwise responsible for hereunder attributable to any
period (prorated on a daily basis) prior to the expiration or
earlier termination of this Lease.
(c) Tenant acknowledges and agrees that the Premises are and
shall be leased by Landlord to Tenant in its present "AS IS"
condition, and that Landlord makes absolutely no representations
or warranties whatsoever with respect to the Premises or the
condition thereof. Tenant acknowledges that Landlord has not
investigated and does not warrant or represent to Tenant that the
Premises are fit for the purposes intended by Tenant or for any
other purpose or purposes whatsoever, and Tenant acknowledges
that the Premises are to be leased to Tenant in their existing
condition, i.e., "AS IS," on and as of the Effective Date.
6. CONDEMNATION
(a) In the event that the whole or any material part of the
building on the Premises or a material portion of the land
constituting a portion of the Premises (for purposes hereof,
"material" shall mean (i) more than twenty percent (20%) of the
building on the Premises or (ii) more than forty percent (40%) of
the land or (iii) more than ten percent (10%) of the parking
spaces or (iv) the drive thru lane or (v) the primary means of
access, ingress and egress to and from the Premises) shall be
taken during the term of this Lease or any extension or renewal
thereof for any public or quasi-public use under any governmental
law, ordinance, regulation or by right of eminent domain, or
shall be sold to the condemning authority under threat of
condemnation with the result that the Premises cannot continue to
be operated as the type of restaurant contemplated herein, or if
all reasonable access to the adjacent roadways from the existing
or comparable curb cuts shall be taken (any of such events being
hereinafter referred to as a "taking"), Tenant shall have the
option of terminating this Lease as of a date no earlier than the
date of such taking, such termination date to be specified in a
notice of termination to be given by Tenant to Landlord not fewer
than fourteen (14) days prior to the date on which possession of
the Premises, or part thereof, must be surrendered to the
condemning authority or its designee.
(b) In the event of any taking which does not give rise to an
option to terminate or in the event of a taking which does give
rise to an option to terminate and Tenant does not elect to
terminate, Landlord shall make its award available to Tenant and
Tenant shall, to the extent of the award from such taking (which
word "award" shall mean the net proceeds after deducting expenses
of any settlement, or net purchase price under a sale in lieu of
condemnation but shall exclude the value of Landlord's
reversionary interest, to the extent specifically allocated and
awarded for same), promptly restore or repair the Premises and
all improvements thereon (except those items of Tenant's Property
which Tenant is permitted to remove under the terms of this
Lease) to the same condition as existed immediately prior to such
taking insofar as is reasonably possible. If the estimated cost
of restoration or repair shall exceed the amount of Landlord's
award, Tenant shall deposit with Landlord the amount of such
excess or post an unconditional bond in favor of Landlord, and in
form acceptable to Landlord, in the amount of such excess. The
award and any excess shall be held in trust by Landlord and used,
to the extent required, for the purpose of such restoration or
repair. A just and proportionate part of the Rent payable
hereunder shall be abated from the date of such taking until ten
(10) days after Tenant has restored same and thereafter the Rent
shall be reduced in proportion to the reduction in the then
rental value of the Premises after the taking in comparison with
the rental value prior to the taking. If the award shall exceed
the amount spent or to be spent promptly to effect such
restoration, repair or replacement, such excess shall
unconditionally belong to Landlord and shall be paid to Landlord.
(c) In the event of any partial taking where this Lease is not
terminated, Tenant shall not be entitled (except for use in
reconstruction) to any part of the compensation or award given
Landlord for the taking of the fee of the Premises, but Tenant
shall have the right to recover from the condemning authority
such compensation as is specifically awarded to Tenant (i) to
reimburse Tenant for any cost which Tenant may incur in removing
Tenant's Property from the Premises and (ii) for loss of Tenant's
business.
(d) If this Lease is terminated by reason of a taking, then
Landlord shall be entitled to receive the entire award in any
such condemnation or eminent domain proceedings or purchase in
lieu thereof and Tenant hereby assigns to Landlord all of its
right, title and interest in and to all and any part of such
award, provided, however, Tenant shall be entitled to receive any
award specifically made to reimburse Tenant.
7. TAXES, ASSESSMENTS, AND ESCROWS
(a) Tenant shall pay prior to delinquency all taxes and
assessments which may be levied upon or assessed against the
Premises and all taxes and assessments of every kind and nature
whatsoever arising in any way from the use, occupancy or
possession of the Premises or assessed against the improvements
situated thereon, together with all taxes levied upon or assessed
against Tenant's Property. To that end, Landlord shall not be
required to pay any taxes or assessments whatsoever which relate
to or may be assessed against this Lease, the Rent and other
amounts due hereunder, the Premises, improvements and Tenant's
Property; provided, however, that any taxes or assessments which
may be levied or assessed against the Premises for a period
ending after the termination hereof shall be prorated between
Landlord and Tenant as of such date. Upon written request by
Tenant to Landlord, within thirty (30) days after Tenant receives
the paid receipted tax bills, Tenant shall furnish Landlord with
copies thereof. Tenant may, at its option, contest in good faith
and by appropriate and timely legal proceedings any such tax and
assessment; provided, however, that Tenant shall indemnify and
hold harmless Landlord from any loss or damage resulting from any
such contest, and all expenses of same (including, without
limitation, all attorneys' fees, court and other costs) shall be
paid solely by Tenant.
(b) In the event Tenant is, or has been, delinquent in the
timely payment of insurance premiums, taxes or any assessments
which may be levied or assessed against the Premises, then at
Landlord's request and in Landlord's sole discretion, Tenant
shall escrow funds for insurance, taxes and assessments in the
following manner:
(i) Tenant shall pay to Landlord a sum (the "Initial Yearly
Escrow Payment") equal to one-fourth of the Yearly Premium (as
defined below), or such greater amount as is deemed necessary by
Landlord to be in position to pay the first annual payment of
insurance and taxes when due. Thereafter, Tenant shall pay to
Landlord on the first day of each month (or on another day
designated in writing by Landlord), a sum (herein, together with
the Initial Yearly Escrow Payment, the "Escrow Funds") equal to
one-twelfth of (a) the yearly taxes and assessments which may be
levied on the Property, and (b) the yearly premium installments
for fire and other hazard insurance, and such other insurance
covering the Premises as Landlord may require pursuant to
Paragraph 4 hereof (together the "Yearly Premium"), all as
reasonably estimated initially and from time to time by Landlord
on the basis of assessments and tax bills and reasonable
estimates thereof. Any waiver by Landlord of a requirement that
Tenant pay such Escrow Funds may be revoked by Landlord, in
Landlord's sole discretion, at any time upon notice in writing to
Tenant. Landlord shall apply the Escrow Funds to pay said
insurance, taxes and assessments, so long as Tenant is not in
Default. No interest shall be payable by Landlord on monies so
paid unless required by applicable law, in which event all such
interest shall be applied by Landlord to pay such insurance,
taxes and assessments. Landlord shall give to Tenant, at
Tenant's expense, an annual accounting of the Funds in Landlord's
normal format showing credits and debits to the Funds and the
purpose for which each debit to the Funds was made.
(ii) If the amount of the Escrow Funds held by Landlord at the
time of the annual accounting thereof shall exceed the amount
deemed necessary by Landlord to provide for the payment of
insurance, taxes and assessments as they become due, such excess
shall be credited to Tenant on the next monthly installment or
installments of Escrow Funds due. If at any time the amount of
the Escrow Funds held by Landlord shall be less than the amount
deemed necessary by Landlord to pay the insurance, taxes and
assessments as they become due, Tenant shall pay to Landlord any
amount necessary to make up the deficiency within thirty (30)
days after notice from Landlord to Tenant requesting payment
thereof.
(iii) Upon Tenant's Default, Landlord may apply, in any
amount and in any order as Landlord shall determine in Landlord's
sole discretion, any Escrow Funds held by Landlord at the time of
application to pay insurance, taxes and assessments which are now
or will hereafter become due. Upon the termination of the Lease
(except for termination as a result of Tenant's Default),
Landlord shall promptly refund to Tenant any Escrow Funds held by
Landlord applicable to the Property.
8. COMPLIANCE, UTILITIES, SURRENDER
(a) Tenant at its expense shall promptly comply with all
governmental requirements, whether or not compliance therewith
shall require structural changes in the Premises; will procure
and maintain all permits, licenses and other authorizations
required for the use of the Premises or any part thereof then
being made and for the lawful and proper installation, operation
and maintenance of all equipment and appliances necessary or
appropriate for the operation and maintenance of the Premises,
and shall comply with all easements, restrictions, reservations
and other instruments of record applicable to the Premises.
Tenant shall indemnify and save Landlord harmless from all
expenses and damages by reason of any notices, orders, violations
or penalties filed against or imposed upon the Premises, or
against Landlord as owner thereof, because of Tenant's failure to
comply with this paragraph.
(b) Tenant shall pay all charges for heat, water, gas, sewage,
electricity and other utilities used or consumed on the Premises
and shall contract for the same in its own name. Landlord shall
not be liable for any interruption or failure in the supply of
any such utility service to the Premises unless caused by or
resulting from the gross negligence or willful misconduct of
Landlord, its agents, servants, employees or contractors.
(c) Tenant shall peacefully surrender possession of the
Premises, the buildings and other improvements thereon, to
Landlord at the expiration, or earlier termination, of the
original term or any extended or renewed term of this Lease.
9. QUIET ENJOYMENT
Landlord covenants and warrants that Landlord has full power
and authority to make this Lease, and that Tenant shall have and
enjoy full, quiet and peaceful possession of the Premises, their
appurtenances and all rights and privileges incidental thereto
during the term hereof and any renewals or extensions, subject to
the provisions of this Lease and any easements, restrictions,
reservations and other instruments of record applicable to the
Premises and in existence at the time of the conveyance of the
Premises to Landlord by Tenant or thereafter.
10. OPTION TO RENEW
Tenant shall have two (2) successive five (5) year options
to extend this Lease for up to an additional ten (10) years upon
the same terms, covenants, conditions and rental as set forth
herein provided that Tenant is not in default hereunder at the
commencement of such option period. Tenant may exercise each
such five (5) year option by giving written notice to Landlord
not less than six (6) months prior to the Termination Date.
Should Tenant fail to give Landlord such timely written notice
during the required period, all remaining rights of renewal shall
automatically expire.
11. FIRST RIGHT OF REFUSAL TO PURCHASE
(a) So long as Tenant is not in default under this Lease, and
after Landlord makes an initial transfer of the Premises, Tenant
shall have a first right of refusal to purchase the Premises in
accordance with the terms of this paragraph. If Landlord
receives and desires to accept a bona fide offer to purchase
(excluding (i) any transfer or assignment to an affiliate of
Landlord; (ii) any like-kind exchange of the Premises by Landlord
pursuant to and in accordance with the provisions of Section 1031
of the Internal Revenue Code of 1986, as amended, and the
Treasury Regulations promulgated thereunder; and (iii) any
assignments and transfers made by Landlord in connection with any
securitization of this Lease) the Premises during the term of
this Lease or any extension or renewal thereof, Landlord shall
deliver a notice to Tenant stating the name of such offeror with
a copy of the terms and conditions of such offer attached and
Tenant shall have the right to purchase the Premises on the same
terms and conditions set forth in Landlord's notice, provided
that Tenant delivers written notice to Landlord of its election
to do so within twenty (20) days after receipt of such notice
from Landlord. If Tenant does not elect to exercise its right to
purchase as aforesaid, Landlord may sell the Premises, provided
the sale is consummated with the offeror and on substantially the
terms and conditions set forth in Landlord's notice to Tenant.
The foregoing right of first refusal shall remain in existence
notwithstanding its non-exercise in respect to any sale and shall
be binding upon Landlord's successors in title.
(b) Tenant's rights granted in (a) above shall be subject and
subordinate to any rights or options currently of record or those
existing in favor of Franchisor, pursuant to any Franchise
Agreements, if any, between Tenant and Franchisor.
12. USE; NONCOMPETE
(a) The use of the Premises shall be limited to operation of (i)
a single concept Arby's restaurant or a dual concept Arby's
restaurant operated concurrently with another nationally or
regionally recognized chain, or (ii) another nationally or
regionally recognized chain approved in writing by Landlord and
in accordance with such reasonable conditions the Landlord may
require to confirm the existence of a valid franchise agreement
and all required approvals necessary for a change in use.
(b) Tenant shall not own an interest in, or operate, an Arby's
Restaurant or another concept currently in operation on the
Premises within a one (1) mile radius of the Premises, unless
approved in writing by both Landlord and Franchisor, such
approval not to be unreasonably withheld by Landlord. Violation
of this covenant shall constitute a default hereunder and,
because the parties agree that damages would not be an adequate
remedy, Tenant hereby agrees that Landlord shall be entitled to
equitable relief, including injunctive relief and specific
performance in addition to any remedy available at law.
13. DEFAULT
(a) If any one or more of the following events occur, said event
or events shall hereby be referred to as a "Default":
(i) If Tenant fails to pay any additional rent, or any other
charges required hereunder or, at Landlord's option, under any
other lease or agreement with Landlord or an affiliate of
Landlord when same shall become due and payable, and such failure
continues for ten (10) days after written notice from Landlord.
(ii) If Tenant shall fail to perform or observe any term,
condition, covenant, agreement, or obligation of this Lease or,
at Landlord's option, any other lease or other agreement with
Landlord or an affiliate of Landlord, and such failure continues
for thirty (30) days after written notice from Landlord (except
that such thirty (30) day period shall be automatically extended
for such additional period of time as is reasonably necessary to
cure such Default, if such Default cannot be cured within such
period, provided Tenant is in the process of diligently curing
the same).
(iii) If any default or event of default shall occur and
remain uncured under any franchise agreement ("Franchise
Agreement") between Tenant and Franchisor following any cure
period applicable thereto and established in the Franchise
Agreement, or if such Franchise Agreement is terminated for any
reason; provided however, that upon such termination, Tenant
shall have a period of six (6) months within which to obtain a
new franchise agreement for operation of a nationally or
regionally recognized restaurant concept at the Premises, before
such default shall be actionable by Landlord. Notwithstanding
the foregoing, Tenant shall have the right to engage in good
faith disputes with Franchisor under the Franchise Agreement
without such dispute constituting a default under this Lease,
provided that such dispute shall not prevent Tenant from
performing its obligations under this Lease.
(iv) If Tenant fails to continuously operate its business within
the Premises except for temporary periods of closure caused by
casualty, or temporary and reasonable periods of remodeling, not
to exceed ninety (90) days in any Lease Year without first
obtaining Landlord's written approval.
(v) If Tenant shall make an assignment for the benefit of
creditors or file a petition, in any federal or state court, in
bankruptcy, reorganization, composition, or make an application
in any such proceedings for the appointment of a trustee or
receiver for all or any portion of its property.
(vi) If any petition shall be filed under federal or state law
against Tenant in any bankruptcy, reorganization, or insolvency
proceedings, and said proceedings shall not be dismissed or
vacated within thirty (30) days after such petition is filed.
(vii) If a receiver or trustee shall be appointed under
federal or state law for Tenant, or any guarantor of Tenant's
obligations hereunder, for all or any portion of the property of
either of them, and such receivership or trusteeship shall not be
set aside within thirty (30) days after such appointment.
(b) Upon the happening of any one or more of the aforementioned
Defaults which are not cured within the cure period applicable
thereto, if any, Landlord shall have the right, in addition to
any other rights and remedies, to terminate this Lease by giving
written notice of same to Tenant. Upon such notice, this Lease
shall cease and expire, and Tenant shall surrender the Premises
to Landlord. Notwithstanding such termination, Tenant's
liability and obligation under all provisions of this Lease,
including the obligation to pay Rent and any and all other
amounts due hereunder shall survive and continue. In addition,
in the event of Tenant's Default under this Lease, Landlord may,
by notice to Tenant, accelerate the monthly installments of Rent
due hereunder for the remaining term of this Lease, in which
event such amount, together with any sums then in arrears, shall
immediately be due and payable to Landlord. In the event of such
acceleration, Landlord shall be entitled to recover from Tenant
(in addition to any other damages provided in this section) the
following: (1) the worth at the time of the award of twelve (12)
months of then current rent; plus (2) the worth at the time of
award of the amount by which (i) the unpaid rent for the balance
of the term beginning twelve (12) months after the time of award,
exceeds (ii) the amount of such rental loss during such period
that Tenant proves could be reasonably avoided, based upon the
then current rental value of the Premises. As used in this
subsection (2) and in subsection (1) above, the "worth at the
time of award' is computed by discounting such amount at the rate
of ten percent (10%). Tenant hereby expressly agrees that its
occupation of the Premises after default constitutes forcible
detainer (or equivalent) as is defined by the law in force in the
jurisdiction in which the Premises are located. In addition, in
the event of Tenant's Default under this Lease, and further in
the event that a Construction Addendum is attached to the Lease,
then, in addition to all other rights and remedies of Landlord
under this Lease, Landlord may cease funding of any amounts under
such Construction Addendum.
(c) If this Lease shall terminate as provided hereinabove,
Landlord may re-enter the Premises and remove Tenant, its agents
and sub-tenants, together with all or any of Tenant's Property,
by suitable action at law, or by force. Tenant waives any right
to the service of any notice of Landlord's intention to re-enter
and Landlord shall not be liable in any way in connection with
any action it takes pursuant to this paragraph. Notwithstanding
such re-entry or removal, Tenant's liability under Lease shall
survive and continue.
(d) In case of re-entry, repossession or termination of this
Lease, Tenant shall remain liable for Rent (with any Percentage
Rent described in the Rent Addendum to be paid at the rate paid
during the Lease Year prior to the date of Default), any
additional rent and all other charges provided for in this Lease
for the otherwise remaining term of this Lease, and any and all
expenses which Landlord may have incurred in re-entering the
Premises including, but not limited to, allocable overhead,
alterations to the building, leasing, construction,
architectural, legal and accounting fees. Landlord shall have
the right, but not the obligation, to relet the whole or part of
the Premises upon terms which Landlord, in its sole discretion,
deems appropriate and Tenant shall be responsible for all
expenses incurred by Landlord in re-letting or attempting to re-
let and all rent collected for reletting shall be credited
against all of Tenant's obligations hereunder.
(e) In the event of a Default, Landlord may, at its sole option,
enter upon the Premises, if deemed necessary by Landlord in its
sole discretion, and/or do whatever may be deemed necessary by
Landlord in its sole discretion to cure such failure by Tenant.
Tenant shall pay to Landlord within five (5) days of Landlord's
request, all costs incurred by Landlord in connection with
Landlord's curing of such failure. In addition to the above
costs, in the event Landlord does not receive payment from Tenant
when due under this subparagraph 13(e), then interest at the rate
of eighteen percent (18%) per annum or, if less, the highest rate
allowable by law, shall be due and payable with respect to such
payment from the due date thereof until Landlord receives such
payment.
(f) In the event Landlord engages legal counsel in connection
with the enforcement of any of the terms and provisions of this
Lease, then, in addition to all other sums due from Tenant to
Landlord under this Lease, Tenant shall pay to Landlord any and
all reasonable attorneys' fees, paralegal fees, and legal costs
and expenses incurred by Landlord, whether or not judicial
proceedings are filed, and including on appeal and in any
bankruptcy proceedings.
(g) The rights and remedies of Landlord set forth herein shall
be in addition to any other right and remedy now or hereinafter
provided by law, and all such rights and remedies shall be
cumulative. No action or inaction by Landlord shall constitute a
waiver of any Default, and no waiver of any Default shall be
effective unless it is in writing, signed by Landlord.
14. HOLDING OVER
In the event Tenant remains in possession of the Premises
after the expiration of this Lease without executing a new
written lease acceptable to Landlord and Tenant, Tenant shall
occupy the Premises as a tenant from month to month subject to
all the terms hereof (except as modified by this Paragraph), but
such possession shall not limit Landlord's rights and remedies by
reason thereof nor constitute a holding over. In the event of
such month to month tenancy, the monthly installment of Annual
Rent due for each such month shall increase to be twice the
monthly installment thereof which was payable during the last
month of the term of this Lease, and Percentage Rent due for each
such month shall be one twelfth of the average annual Percentage
Rent paid by Tenant for the last three years of the term of this
Lease.
15. WAIVER OF SUBROGATION
Notwithstanding anything in this Lease to the contrary,
other than Tenant's obligations to repair, restore or rebuild
described in paragraph 4 of this Lease, neither party shall be
liable to the other for any damage or destruction of the Premises
of the other resulting from fire or other casualty covered by
insurance required of either party hereunder, whether or not such
loss, damage or destruction of the Premises are caused by or
results from the negligence of such party (which term includes
such party's officers, employees, agents and invitees), and each
party hereby expressly releases the other from all total
liability for or on account of any said insured loss, damage or
destruction, whether or not the party suffering the loss is
insured against such loss, and if insured whether fully or
partially. Each party shall procure all endorsements of
insurance policies carried by it necessary to protect the other
from any right of subrogation and/or liability in the event of
such loss.
16. LANDLORD'S LIEN FOR RENTS
As security for Tenant's payment of Rent and all other
payments required to be made by Tenant hereunder (including, by
way of illustration only, taxes, damage to the Premises, court
costs, and attorneys' fees) Tenant hereby grants to Landlord a
lien upon all of Tenant's Property now or hereafter located upon
the Premises. The lien herein provided shall be subordinate to
the lien of any chattel mortgage, collateral assignment or
security interest given by Tenant to any seller of Tenant's
Property. In the event of a Default, Landlord may enter upon the
Premises and take possession of Tenant's Property, or any part
thereof, and may sell all or any part of Tenant's Property at
public or private sale in one or successive sales, with or
without notice, to the highest bidder for cash and on behalf of
Tenant. Landlord may sell and convey Tenant's Property, or any
part thereof, to such bidder, delivering to such bidder all of
Tenant's title and interest in such property sold to him. The
proceeds of such sale shall be applied by Landlord toward the
costs of such sale and then toward the payment of all sums when
due by Tenant to Landlord under this Lease.
17. ASSIGNMENT AND SUBLETTING
(a) After the initial transfer or sale of the Premises by
Landlord, Tenant may assign or sublet the Premises to a majority
owned subsidiary or affiliate of RTM, Inc., or to a franchisee or
any parent or operating subsidiary of Tenant, or a corporation or
other entity with which Tenant may merge or consolidate or to
which Tenant may sell all or a substantial portion of its assets
or stock; provided, however, that the Property shall be used only
as it was used prior to such transfer event, and provided further
that the party merging, consolidating or purchasing the asset or
stock of Tenant shall execute and deliver to the Landlord a full
and unconditional guarantee of the obligations of Tenant. Tenant
shall not have the right to assign or sublet any part or all of
the Premises to any other parties for any other purposes, without
first obtaining Landlord's prior written consent, which consent
shall not be unreasonably withheld, conditioned or delayed by
Landlord. Even if such consent to assignment or subletting is
given by Landlord, such assignment or subletting shall not
relieve Tenant of its liability for the continued performance of
all terms, covenants and conditions of this Lease, including
without limitation the payment of all Rent and other charges
thereunder.
(b) [INTENTIONALLY DELETED]
(c) Prior to any assignment allowed hereunder, Tenant shall
deliver to Landlord (i) a copy of the assignment documents
(including copies of any recorded documents related thereto);
(ii) the name, address and telephone number of such assignee and
a designated contact person for such assignee; (iii) a new
insurance policy and binder complying with the terms of this
Lease and naming such assignee as the tenant of the Premises; and
(iv) an agreement executed by such assignee, in recordable form,
whereby such assignee assumes and agrees to discharge all
obligations of Tenant under this Lease. Notwithstanding anything
in this Lease to the contrary, in the event of any assignment of
this Lease or subletting of the Premises, Tenant shall not be
released from its obligations under this Lease unless
specifically released by virtue of a separate written instrument
executed by Landlord, which may be withheld in Landlord's sole
discretion.
(d) Landlord shall have the right without limitation (subject to
paragraph 11 hereof) to sell, convey, transfer or assign its
interest in the Premises or its interest in this Lease, and upon
such conveyance being completed all covenants and obligations of
Landlord under this Lease accruing thereafter shall cease, but
such covenants and obligations shall run with the land and shall
be binding upon the subsequent landlord or owners of the Premises
or of this Lease.
18. SUBORDINATION, NON-DISTURBANCE, ATTORNMENT, ESTOPPEL
CERTIFICATE.
(a) Upon written request of the holder of any mortgage (which
term "mortgage" shall also include deeds of trust) now or
hereafter relating to the Premises, Tenant will subordinate its
rights under this Lease to the lien thereof and to all advances
made or hereafter to be made upon the security thereof, and
Tenant shall execute, acknowledge and deliver an instrument in
the form customarily used by such encumbrance holder to effect
such subordination; provided, however, as a condition of all such
subordinations, the holder of such mortgage shall be first
required to execute an agreement in recordable form with Tenant
that, notwithstanding the foreclosure or other exercise of rights
under any such first or other mortgage, Tenant's possession and
occupancy of the Premises and the improvements and its leasehold
estate shall not be disturbed or interfered with nor shall
Tenant's rights and obligations under this Lease be altered or
adversely affected thereby so long as Tenant is not in Default.
(b) Notwithstanding anything set out in subparagraph (a) above
to the contrary, in the event the holder of any such mortgage
elects to have this Lease be superior to its mortgage, then upon
Tenant's being notified to that effect by such encumbrance
holder, this Lease shall be deemed prior to the lien of said
mortgage, whether this Lease is dated prior or subsequent to the
date of said mortgage, and Tenant shall execute, acknowledge and
deliver an instrument, in the form customarily used by such
encumbrance holder, effecting such priority.
(c) In the event proceedings are brought for the foreclosure of,
or in the event of the exercise of the power of sale under any
mortgage made by Landlord encumbering the Premises, or in the
event of delivery of a deed in lieu of foreclosure under such a
mortgage Tenant will attorn to the purchaser upon any such
foreclosure or sale and recognize such purchaser as "Landlord"
under this Lease, and upon the request of the purchaser, Tenant
shall execute, acknowledge and deliver an instrument, in form and
substance satisfactory to such purchaser, evidencing such
attornment.
(d) Each party agrees, within seven (7) days after written
request by the other, to execute, acknowledge and deliver to and
in favor of any proposed mortgagee or purchaser of the Premises,
an estoppel certificate, in the form customarily used by such
proposed mortgagee or purchaser, stating, among other things (i)
whether this Lease is in full force and effect, (ii) whether this
Lease has been modified or amended and, if so, identifying and
describing any such modification or amendment, (iii) the date to
which Rent and other charges have been paid, and (iv) whether the
party furnishing such certificate knows of any default on the
part of the other party or has any claim against such party and,
if so, specifying the nature of such default or claim.
(e) Upon written demand by the holder of any mortgage covering
the Premises, Tenant shall forthwith execute, acknowledge and
deliver an agreement in favor of and in the form customarily
used by such encumbrance holder, by the terms of which Tenant
will agree to give prompt written notice to such encumbrance
holder in the event of any casualty damage to the Premises or in
the event of any default on the part of Landlord under this
Lease, and will agree to allow such encumbrance holder a
reasonable length of time after notice to cure or cause the
curing of such default before exercising Tenant's rights under
this Lease, or terminating or declaring a default under this
Lease.
19. COOPERATION
(a) Landlord shall fully cooperate with Tenant throughout the
term of this Lease to secure or maintain proper zoning, building
and other permits and compliance with all applicable laws.
Landlord shall execute any petitions, requests, applications and
the like as Tenant shall reasonably request in order to obtain
any permit, license, variances and approvals which, in the
reasonable judgment of Tenant, are necessary for the lawful
construction and/or operation of Tenant's business on the
Premises, provided, however, that Tenant shall indemnify and save
Landlord harmless from any and all expenses, costs, charges,
liabilities, losses, obligations, damages and claims of any type
which may be imposed upon, asserted against or incurred by
Landlord by reason of same.
(b) In the event that Tenant elects to purchase the Premises
pursuant to the terms and conditions of Paragraph 11 hereof,
Landlord shall have the right, in Landlord's sole discretion, to
enter into an exchange agreement (the "Exchange Agreement") with
a qualified intermediary (the "Intermediary") in order to
effectuate a like-kind exchange of the Premises for one or more
other properties (the "Replacement Property"). Landlord and
Tenant agree that, at Landlord's option, Tenant shall cooperate
with Landlord in effecting a like-kind exchange of the Premises
by Landlord pursuant to and in accordance with the provisions of
Section 1031 of the Internal Revenue Code of 1986, as amended,
and the Treasury Regulations promulgated thereunder, which
cooperation shall include, without limitation, Tenant's consent
to Landlord's assignment of its interest in Tenant's exercise of
Tenant's right of first refusal to the Intermediary and Tenant
receiving or taking title to the Premises from the Intermediary
or another third party utilized in the transaction in order to
facilitate the like-kind exchange on behalf of Landlord.
20. NOTICES
All notices and other communications required or permitted
to be given hereunder shall be in writing and shall be delivered
by a nationally recognized overnight courier or mailed by
registered or certified mail, postage prepaid, return receipt
requested, addressed as follows:
If to Landlord: CNL RESTAURANT INVESTORS PROPERTIES, LLC
X.X. Xxx 0000
Xxxxxxx, XX 00000-0000
with copy to: XXXX X. XXXXXX, ESQUIRE
Lowndes, Drosdick, Doster, Xxxxxx & Xxxx, P.A.
000 Xxxxx Xxxx Xxxxx
Post Office Box 2809
Xxxxxxx, Xxxxxxx 00000
If to Tenant: FRANCHISE ASSOCIATES, INC.
0000 Xxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Mr. J. Xxxxxxx Xxxxx, Senior Vice
President
with a copy to: RTM, Inc.
0000 Xxxxxxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Attention: General Counsel
Any party may change its address for notices by written
notice in like manner as provided in this paragraph and such
change of address shall be effective seven (7) days after the
date notice of such change of address is given. Notice for
purposes of this Lease shall be deemed received upon the earlier
of (i) actual receipt or (ii) in the case of delivery by a
nationally recognized overnight courier service on the first
(1st) business day after deposit with the service or (iii) in the
event of certified mail, on the fifth (5th) business day after
deposit in the United States mail.
21. INDEMNIFICATION
Tenant does hereby indemnify and exonerate Landlord against
and from all liabilities, losses, obligations, damages,
penalties, claims, costs, charges and expenses, including
reasonable architects' fees, attorneys' fees, paralegal fees, and
legal costs and expenses incurred by Landlord, whether or not
judicial proceedings are filed, and including on appeal and in
any bankruptcy proceedings, which may be imposed upon or asserted
against or incurred by Landlord by reason of any of the following
occurring:
(a) any work or thing done in respect of construction of, in or
to the Premises or any part of the improvements now or hereafter
constructed on the Premises;
(b) any use, possession, occupation, operation, maintenance or
management of the Premises or any part hereof;
(c) any failure to, or to properly, use, possess, occupy,
operate, maintain or manage the Premises or any part thereof;
(d) the condition, including environmental conditions, of the
Premises or any part thereof;
(e) any negligence on the part of Tenant or any of its agents,
contractors, servants, employees, licensees or invitees;
(f) any accident, injury or damage to any person or property
occurring in, on or about the Premises or any part thereof
including any sidewalk adjacent thereto; or
(g) any failure on the part of Tenant to perform or comply with
any of the covenants, agreements, terms or conditions contained
in this Lease on its part to be performed or complied with.
22. HOLD HARMLESS
Tenant agrees to hold Landlord harmless against any and all
claims, damages, accidents and injuries to persons or property
caused by or resulting from or in connection with anything in or
pertaining to or upon the Premises during the term of this Lease
or while Tenant is occupying the Premises, except if such claim,
damage, accident or injury shall be caused by the negligence or
willful misconduct of Landlord or its agents. Landlord shall not
be liable to Tenant, Tenant's employees, agents, invitees,
licensees or any other person whomsoever for any injury to person
or damage to property on or about the Premises caused by the
negligence or misconduct of Tenant, its agents, servants or
employees or of any other person entering the building under
expressed or implied invitation by Tenant or due to any other
cause whatsoever, unless caused by the negligence or willful
misconduct or neglect of Landlord, its employees or its
authorized representatives.
23. LANDLORD'S LIABILITIES
The term "Landlord" as used in this Lease means the owner
from time to time of the Premises. Neither Landlord nor any
partner, shareholder or beneficiary thereof shall have any
personal liability with respect to any of the provisions of this
Lease and if Landlord is in default with respect to its
obligations hereunder Tenant shall look solely to the equity of
Landlord in the Premises.
24. SUCCESSORS
The covenants, conditions and agreements contained in this
Lease shall bind and inure to the benefit of Landlord and Tenant
and their respective heirs, legal representatives, successors and
assigns.
25. ENTIRE AGREEMENT/MEMORANDUM OF LEASE
This Lease contains the entire agreement between the parties
hereto and may not be modified in any manner other than in
writing signed by the parties hereto or their successors in
interest. A memorandum of this Lease shall be executed by the
parties and shall be recorded in the official records of the
county where the Premises are located.
26. GENDER
Whenever the context hereof permits or requires, words in
the singular may be regarded as in the plural and vice-versa, and
personal pronouns may be read as masculine, feminine and neuter.
27. BROKERAGE FEES
It is understood and agreed that neither party has incurred
any real estate brokerage fees or commissions arising out of this
Lease and each party agrees to hold the other harmless from and
against all such fees and commissions incurred, and costs related
thereto including legal fees, as a result of its own conduct or
alleged conduct.
28. CAPTIONS
The captions of this Lease are for convenience only, and do
not in any way define, limit, disclose, or amplify terms or
provisions of this Lease or the scope or intent thereof.
29. LANDLORD'S RIGHT TO CURE
In the event Tenant shall fail, refuse or neglect to
perform, observe or comply with any term, condition, covenant,
agreement or obligation contained in the Lease on its part to be
performed or complied with, after receipt of notice and failure
of Tenant to undertake an appropriate cure, then the Landlord
may, at its sole option, enter upon the Premises, if deemed
necessary by Landlord in its sole discretion, and/or do whatever
may be deemed necessary by Landlord in its sole discretion to
cure such failure by Tenant. Tenant shall pay to Landlord within
five (5) days of receipt of Landlord's request, all costs
incurred by Landlord in connection with Landlord's curing of such
failure by Tenant including, but not limited to, reasonable
attorney and paralegal fees actually incurred whether or not
judicial proceedings are involved. In addition to the above
costs, in the event Landlord does not receive payment from Tenant
when due as set forth in this paragraph, interest at the lower of
the highest lawful rate or the rate of eighteen percent (18%) per
annum shall be due and payable with respect to such payment from
the date of expiration of the period of grace or cure applicable
thereto following Landlord's delivery of a written notice of
default, until Landlord receives such payment.
30. NOT A SECURITY ARRANGEMENT
The parties hereto agree and acknowledge that this
transaction is not intended as a security arrangement or
financing secured by real property, but shall be construed for
all purposes as a true lease.
31. NET LEASE
It is the intention of the parties hereto that this Lease is
and shall be treated as a triple net lease. Any present or
future law to the contrary notwithstanding, this Lease shall not
terminate (except as expressly provided in subparagraph 4(a)) nor
shall Tenant be entitled to any abatement, suspension, deferment,
reduction (except as expressly provided in subparagraph 6(b)
hereof), setoff, counterclaim, or defense with respect to the
rent. The parties intend that Tenant be obligated hereunder to
pay all costs and expenses incurred with respect to, and
associated with, the Premises and the business operated thereon
and therein; provided, however, that Landlord shall nonetheless
be obligated to pay (i) any debt service on any mortgage
encumbering Landlord's fee simple interest in the Premises; (ii)
Landlord's personal income taxes with respect to the rents
received by Landlord under this Lease; and (iii) any expenses
related solely to the partnership or corporate restructuring, as
the case may be, of the Landlord. Except as expressly
hereinabove provided, Landlord shall bear no cost or expense of
any type or nature with respect to, or associated with, the
Premises. The parties also intend that the obligations of Tenant
hereunder shall be separate and independent covenants and
agreements and shall continue unaffected unless such obligations
shall have been modified or terminated in accordance with an
express provision of this Lease.
32. WAIVER
No waiver by Landlord of any provision hereof shall be
deemed a wavier of any other provision hereof or of any
subsequent breach by Tenant of the same or any other provision.
Landlord's consent to, or approval of, any act shall not be
deemed to render unnecessary the obtaining of Landlord's consent
to or approval of any subsequent act by Tenant. The acceptance
of rent hereunder by Landlord shall not be a waiver of any
preceding breach by Tenant of any provision hereof, other than
the failure of Tenant to pay the particular rent so accepted,
regardless of Landlord's knowledge of such preceding breach at
the time of acceptance of such rent.
33. TIME OF THE ESSENCE
Landlord and Tenant agree that time shall be of the essence
of all terms and provisions of this Lease.
34. GOVERNING LAW
This Lease shall be construed in accordance with the laws of
the state in which the Premises are located.
35. LEASE SECURITIZATION
Landlord reserves the right to assign, transfer,
participate, pledge, hypothecate or encumber, or any combination
thereof, all or any part of Landlord's interest in this Lease or
any of the collateral and documents mentioned herein without
Tenant's consent. Without limiting the generality of the
foregoing, Tenant acknowledges that this Lease may be
securitized, and Tenant agrees to cooperate in good faith with
Landlord's reasonable requests relating to the securitization
program process and requirements, and agrees and acknowledges
that all information relating to Tenant and this Lease may be
made available by Landlord to the other participants in the lease
securitization, and Tenant agrees to assist Landlord in
completing any documents necessary to accomplish any such
transfer and/or securitization transaction. Tenant hereby
authorizes Landlord to provide any information regarding Tenant
in all reports required as part of a lease securitization program
or by any governmental body regulating Landlord. The parties
intend this provision apply only to the extent that investors
(not to include direct competitors), investment bankers and
rating agencies request such financial information about the
Tenant.
[Signatures on Next Page]
IN WITNESS WHEREOF, the parties hereto have caused this
Lease Agreement to be executed the day and date first above
written.
"LANDLORD"
Signed, Sealed and Delivered
in the presence of: CNL RESTAURANT INVESTORS
PROPERTIES, LLC, a Delaware
limited liability company
/s/ Xxxxx Xxxxx
Name: Xxxxx Xxxxx BY: CNL RESTAURANT INVESTORS
PROPERTIES, INC., a
Delaware corporation, as
/s/ Xxxx X Xxxxxx Managing Member
Name: Xxxx X Xxxxxx
By: /s/ Xxxxxx X Xxxxxx
Xxxxxx X. Xxxxxx, Xx.,
President
(CORPORATE SEAL)
STATE OF FLORIDA
COUNTY OF ORANGE
The foregoing was acknowledged before me this 13 day of
February 2001, by Xxxxxx X. Xxxxxx, Xx., as President of CNL
RESTAURANT INVESTORS PROPERTIES, INC., a Delaware corporation, as
Managing Member of CNL RESTAURANT INVESTORS PROPERTIES, LLC, a
Delaware limited liability company, on behalf of the corporation
and limited liability company.
/s/ Xxxxx Xxxxx
(NOTARY SEAL) Notary Public, State of Florida
Printed Name:
Notary Commission No.
My Commission Expires:
"TENANT"
FRANCHISE ASSOCIATES, INC., a
Minnesota corporation
/s/ Xxxxx Xxxxxxxx By: /s/ Xxxxxxx X Xxxxxx
Name: Xxxxx Xxxxxxxx Name: Xxxxxxx X Xxxxxx
As Its: Senior Vice President
Name: (CORPORATE SEAL)
FRANCHISE ASSOCIATES, INC., a
Minnesota corporation
/s/ Xxxxx Xxxxxxxx By: /s/ Xxxxxx X Xxxxxxx
Name: Xxxxx Xxxxxxxx Name: Xxxxxx X Xxxxxxx
As Its: Vice President
Name: (CORPORATE SEAL)
STATE OF GEORGIA
COUNTY OF XXXXXX
The foregoing was acknowledged before me this 13th day of
February 2001, by Xxxxxxx X Xxxxxx, as Senior Vice President of
FRANCHISE ASSOCIATES, INC., a Minnesota corporation, on behalf of
the corporation.
/s/ Xxxxxxxxxx X Xxxxxx
(NOTARY SEAL) Notary Public, State of Georgia
Printed Name:
Notary Commission No.
My Commission Expires:
STATE OF GEORGIA
COUNTY OF XXXXXX
The foregoing was acknowledged before me this 13th day of
February 2001, by Xxxxxx X Xxxxxxx, as Vice President of
FRANCHISE ASSOCIATES, INC., a Minnesota corporation, on behalf of
the corporation.
/s/ Xxxxxxxxxx X Xxxxxx
(NOTARY SEAL) Notary Public, State of Georgia
Printed Name:
Notary Commission No.
My Commission Expires:
EXHIBITS ATTACHED
Exhibit "A" - Legal Description
EXHIBIT "A"
Legal Description of the Premises
Arby's/Sbarro, Site #6910/Xxxx Rapids, Anoka County, Minnesota
Parcel A:
Xxx 0, Xxxxx 0, xx Xxxxxxxxx Xxxxxxx Fourth Addition, Anoka
County, Minnesota
Parcel B:
Nonexclusive appurtenant easements as contained in Reciprocal
Easement Agreement dated November 8, 1995, filed December 20,
1995, as Document No. 275288, as amended by Amendment to
Reciprocal Easement Agreement dated February 28, 1997, filed
March 7, 1997, as Document No. 293713, as amended by Second
Amendment to Reciprocal Easement Agreement dated February 28,
1997, filed March 7, 1997, as Document No. 293714, as amended by
Fourth Amendment To Reciprocal Easement Agreement dated November
12, 1997, filed November 13, 1997, as Document No. 303549, as
amended by Fifth Amendment To Reciprocal Easement Agreement dated
October 12, 1998, filed December 23, 1998, as Document No. 325412
AND
Nonexclusive appurtenant easements as contained in Operation and
Easement Agreement as contained in document dated November 12,
1997, filed November 13, 1997, as Document No. 303551, as amended
by First Amendment to Operation and Easement Agreement as
contained in document dated October 12, 1998, filed December 23,
1998, as Document No. 325413.
EXHIBIT "B"
Arby's Unit
Arby's/Sbarro, Site #6910/Xxxx Rapids, Anoka County, Minnesota
All Furniture, Trade Fixtures, Equipment and other personal
property now or hereafter owned by Lessee and located at the
Premises whether affixed to the realty or not and including those
items listed under Part I hereinafter, but specifically excluding
from said Furniture, Trade Fixtures, Equipment and other personal
property, those items listed under Part II hereinafter.
Part I
2 Ice Tea Dispensers
1 Knife Rack w/skirt
1 Wall Mounted Employee Lockers
2 Microwave - 2200 Xxxxx
1 Electric Griddle (Breakfast units only)
2 Packet Rack Condiment Holder
1 Fry Freezer on Casters w/warranty
1 Safe w/Smart Lock
1 Water Filter System w/Prefilter
1 Warmer 2 Stacked w/Casters
2 Cheese Pump
1 Battery of 3 Fryers
1 1" Gas Hose Kit
1 Ice Machine w/Ice Bin
1 Double Oven w/Casters
1 3/4" Gas Hose Kit
1 Shake Machine
1 Mixer
1 Can Opener
1 Lever Waster Drains (set of 5)
3 Faucet
1 Slicer w/Heatlamp
1 Slicer w/Vegetable Chute
1 Twin Airpot Xxxxxx
Part I - continued
1 Case of Airpots (6) - 4 Black and 2 Orange
1 24" Ticket Holder
4 Cup Dispensers - Vertical Mount
8 Cup Dispensers - Horizontal Mount
2 Toaster
2 Dessert DisplayCase
1 Chemical Cabinet
1 Lot Dry Storage Mobile Shelving/Cooler & Freezer Shelving
1 4 Compartment Sink
1 Lot 4 Compartment Sink Shelving
1 Prep Sink
1 Lot Prep Sink Shelving
1 Lot Music System Shelving
1 Lot Front Counter Shelving
1 Prep Table (30" x 108")
1 Griddle Table (24" x 36") (Breakfast units only)
1 54" Fry Dump Type A w/Dry Storage & Shelf
1 16'-0" Slicer Table w/Handsink
1 Standard Smallwares Package
1 VCR Wireless Remote
3 Accuweigh Scale
1 CO2 System: Xxxxxxxxxx 000, Xxxx XX0Xxxx
0 0/0" Interior Menuboard System
1 Full Exterior Menuboard w/Speakerpost
1 Set 3 Appendages for Exterior Menuboard System
1 Standard 1 Tower Coke System for D/T Window
1 Set Self-Serve Drink System w/Icemaker & 6 Soda Valves
1 Set Slide-Out Units for Self-Serve Beverage Bar
1 Register Package
1 Drive-Thru & Dining Area Music System
1 Signage Package (B-16 Sign w/5x8 Readerboard, (4) sets
36" Arby's Building Letters, 48" Exposed Neon Logo)
1 Set Exterior Awnings
1 Border Neon Package
1 Remote Condiment Dispensing System
1 Portion Cup Dispensers
1 Decor/Seating Package
Lot Pendant Lights
Part I - continued
Lot Convection oven, display cabinets, gourmet coffee system
and signage used in the operation of a "TJ Cinnamon's"
franchise at the Premises.
2 Exhaust Hood with Exhaust Fans and Fire Extinguisher
Lot Yard Lights
1 Walk-In Cooler/Freezer & Remote Condenser
Part II
Electrical, Heating and Air Conditioning
EXHIBIT "C"
Arby's/Sbarro, Site #6910, Xxxx Rapids, Anoka County, Minnesota
RENT ADDENDUM
to
LEASE AGREEMENT
THIS RENT ADDENDUM dated February 20, 2001, by and between
CNL RESTAURANT INVESTORS PROPERTIES, LLC, a Delaware limited
liability company as "Landlord", and FRANCHISE ASSOCIATES, INC.,
a Minnesota corporation, as "Tenant", for Arby's/Sbarro, Site
#6910, Xxxx Rapids, Anoka County, Minnesota, is attached to and
made a part of that certain Lease Agreement by and between
Landlord and Tenant of even date herewith (the "Lease").
Notwithstanding any other provision to the contrary which may be
contained in said Lease, it is specifically agreed by and between
Landlord and Tenant as follows:
1. DEFINITIONS. Capitalized terms used in this Rent Addendum
shall, unless otherwise defined, have the meaning ascribed to
them in the Lease or, if applicable, the Construction Addendum.
In addition, for purposes of this Rent Addendum, the Lease and,
if applicable, the Construction Addendum, the following terms
shall have the meaning ascribed to them:
"Gross Sales" shall mean the gross amount charged for all
sales or services made from the Premises by Tenant, for cash or
credit, paid or unpaid, less any sales taxes, returns, exchanges,
allowances, discounts, employee meals, and excluding sales of
Tenant's Property or Tenant's leasehold interest. Gross Sales
shall include, without limitation, gross Rents or other amounts
received by Tenant from the licensees or concessionaires owning
and operating coin operated machines and devices, such as
cigarette machines, but not the amount taken in by such machines
or devices. The term "sales tax" shall mean taxes which by law
(1) are not imposed on Tenant or any other party prior to sale at
retail by Tenant, but (2) are imposed on purchasers from Tenant
at retail and collectible by Tenant from such purchasers.
2. COMMENCEMENT OF RENT. On the date hereof, Landlord has
simultaneously entered into the Lease with Tenant pursuant to
which Tenant has agreed to lease from Landlord the Premises and
all improvements now or hereafter constructed thereon. Payment
of Rent shall commence as of the Effective Date as provided
herein, notwithstanding that any improvements contemplated to be
constructed on the Premises may not be constructed or complete at
that time.
3. ANNUAL RENT.
(A) Beginning on the Annual Rent Commencement Date, Tenant
covenants and agrees to pay to Landlord annual rent ("Annual
Rent") in the annual amount of One Hundred Thirty-Six Thousand
Five Hundred Eighty-Four and 86/100 Dollars ($136,584.86),
payable to Landlord in equal monthly installments in the amount
of Eleven Thousand Three Hundred Eighty-Two and 07/100 Dollars
($11,382.07) monthly in advance, on the first (1st) day of each
month.
(B) INCREASES IN ANNUAL RENT. Commencing at the end of the
fifth (5th) Lease Year after the Annual Rent Commencement Date,
and on each one (1) year anniversary of such date thereafter
during the term of this Lease (and any extension thereof), Annual
Rent shall be increased by an amount equal to one percent (1%) of
the Annual Rent payable during the immediately preceding Lease
Year.
4. PERCENTAGE RENT. In addition to the Annual Rent set forth
above, Tenant shall pay, as additional Rent, percentage rent
("Percentage Rent") as follows: Within thirty (30) calendar days
after the expiration of each Lease Year, Tenant shall pay, in one
lump sum, an amount equal to (i) four percent (4%) multiplied by
Tenant's Gross Sales for the Lease Year then ended, minus (ii)
the Annual Rent payable for such Lease Year. At such time, Tenant
shall also furnish Landlord a sworn statement showing the Gross
Sales made by Tenant during such Lease Year then ended.
(A) INSPECTION OF RECORDS. Landlord or its duly authorized
representatives may on regular business days within reasonable
office hours, inspect Tenant's records of Gross Sales and
deductions made in the Premises, either at the Premises or
elsewhere as reasonably designated by Tenant, provided such
inspection is commenced within thirty-six (36) months after a
statement of Gross Sales is furnished to Landlord by Tenant or
should have been delivered and is limited to the period covered
by such statement. Any claim by Landlord for revision of any
statement of Gross Sales or for additional Percentage Rent must
be made in writing to Tenant within thirty-six (36) months after
the date such statement of Gross Sales is mailed to Landlord, or
within thirty (30) days following completion of its inspection,
otherwise it shall be deemed waived by Landlord.
(B) REPORTING ERRORS. If Landlord inspects Tenant's records as
permitted by this Rent Addendum and if such inspection shows an
error(s) in the statements submitted by Tenant which results in
an understatement of Gross Sales by more than three percent (3%),
then in addition to paying the Percentage Rent due, Tenant shall
pay Landlord the reasonable cost of such inspection. In the
event such inspection shows an overstatement of Gross Sales, then
Landlord shall refund such overpayment to Tenant.
5. SALES/USE TAX. Tenant shall also pay to Landlord any sales
and use tax imposed on any Rents payable hereunder from time to
time by state law or any other governmental entity, which sums
are due monthly as to monthly rent payments and annually as to
Percentage Rent on the due date of the rent payment under this
Lease.
6. REPORTING. Tenant shall, during the term of this Lease and
any extensions thereto: (i) keep books and records reflecting
its financial condition including, but not limited to, the
operation of the Premises in accordance with generally accepted
accounting principles consistently applied; (ii) furnish to
Landlord within forty-five (45) days after the end of each fiscal
quarter of Tenant an unaudited financial statement of Tenant and
a statement of income and expenses of the Premises; (iii) cause
to be furnished to Landlord the fiscal year end audited current
signed financial statement of RTM, Inc., RTM Partners, Inc., RTM
Acquisition Company, L.L.C. and RTM Management Company, L.L.C.
(including an annual balance sheet, a profit/loss statement,
statement of cash flow and footnotes) within 120 days from the
close of the fiscal year for RTM, Inc., RTM Partners, Inc., RTM
Acquisition Company, L.L.C. and RTM Management Company, L.L.C.
7. CONSOLIDATED FIXED CHARGE COVERAGE RATIO. Tenant shall
maintain a Consolidated Fixed Charge Coverage Ratio of not less
than 1.1:1, based on an EBITDAR calculation (the "EBITDAR FCCR"),
The EBITDAR FCCR means, for the trailing twelve (12) month
period, the ratio of (a) the Tenant's Cash Flow for such period
to (b) the Tenant's Debt Service for such period. "Cash Flow"
means (only as to the EBITDAR FCCR), for any period, an amount
equal to (a) the sum of (i) pre-tax income, (ii) interest
expense, (iii) all non-cash amounts in respect of depreciation
and amortization, (iv) rental payments, and (v) non-recurring
expenses less (b) non-recurring income, all as reflected on the
Tenant's financial statement for such period. "Debt Service"
means (only as to the EBITDAR FCCR), all of the Tenant's
interest, the current portion of principal, rental payments and
current portion of capital lease obligations. Notwithstanding
Tenant's failure to comply with the provisions of this Xxxxxxxxx
0, Xxxxxx shall not be in Default under the provisions of this
Lease unless and until a Default occurs under the provisions of
paragraph 13(a) of the Lease.
8. LATE CHARGES. In the event any installment of Rent is not
received by Landlord within ten (10) days of its respective due
date, there shall be an automatic late charge due to Landlord
from Tenant in the amount of five percent (5%) of such delinquent
installment of rent. All such late charges due hereunder shall
be deemed additional Rent, and are not penalties but rather are
charges attributable to administrative and collection costs
arising out of such delinquency. In addition to such late
charge, in the event Landlord does not receive Rent when due
hereunder, interest at the rate of the maximum rate allowable by
law shall be due and payable with respect to such payment from
the due date thereof until Landlord receives such Rent.
9. PAYMENTS OF RENTS. All Rent payments shall be made by
electronic funds transfer to Landlord to the account and in
accordance with the procedures designated by Landlord, or in such
other manner as Landlord or its successors or assigns,
respectively, may from time to time designate in writing.
10. NO ABATEMENT. Unless otherwise stated in the Lease, no
abatement, offset, diminution or reduction of (a) Rent, charges
or other compensation, or (b) Tenant's other
obligations under this Lease shall be allowed to Tenant or any
person claiming under Tenant, under any circumstances or for any
reason whatsoever.
INITIALED FOR IDENTIFICATION:
/s/ RWC Franchise Associates, Inc.
a Minnesota Corporation
/s/ Xxxxxxx X Xxxxxx
Senior Vice President
By Landlord By Tenant
/s/ Xxxxxx X Xxxxxxx
Vice President
