EXHIBIT 10.32
LEASE
THIS LEASE (as amended, supplemented or otherwise modified from time to
time, the "Lease") is made as of the 26th day of March, 2004, by and between
QFI-LITTLE ROCK AR, LLC, a Delaware limited liability company, as landlord,
having an office at x/x Xxxxxxxx Xxxxxxxxxxx Xxxxxxxxxxx, One Wachovia Center,
000 Xxxxx Xxxxxxx Xxxxxx, XX-00, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000, and
QUALITY FOODS, INC., an Arkansas corporation, as tenant, having an office at c/o
Performance Food Group, 00000 Xxxx Xxxxx Xxxxxxx, Xxxxxxxx, Xxxxxxxx 00000. In
consideration of the rents and provisions herein stipulated to be paid and
performed, Landlord and Tenant, intending to be legally bound, hereby covenant
and agree as follows:
1. Certain Definitions. All capitalized terms, unless otherwise defined
herein, shall have the respective meanings ascribed to such terms in Appendix A
annexed hereto and by this reference incorporated herein.
2. Demise of Premises. Landlord hereby demises and lets to Tenant, and
Tenant hereby takes and leases from Landlord, for the term and upon the
provisions hereinafter specified, the Leased Premises.
3. Title and Condition.
(a) The Leased Premises are demised and let subject to (i) the
Permitted Encumbrances, (ii) all Legal Requirements and Insurance Requirements,
including any existing violation of any thereof, and (iii) the condition of the
Leased Premises as of the commencement of the Term, without representation or
warranty by Landlord, it being understood and agreed, however, that the recital
of the Permitted Encumbrances herein shall not be construed as a revival of any
thereof which for any reason may have expired.
(b) LANDLORD HAS NOT MADE AND WILL NOT MAKE ANY INSPECTION OF ANY
OF THE LEASED PREMISES, AND LANDLORD LEASES AND WILL LEASE AND TENANT TAKES AND
WILL TAKE THE LEASED PREMISES "AS IS", AND TENANT ACKNOWLEDGES THAT LANDLORD
(WHETHER ACTING AS LANDLORD HEREUNDER OR IN ANY OTHER CAPACITY) HAS NOT MADE AND
WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED TO HAVE MADE, ANY WARRANTY OR
REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES,
INCLUDING ANY WARRANTY OR REPRESENTATION AS TO ITS FITNESS FOR USE OR PURPOSE,
DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE, AS TO THE QUALITY OF THE
MATERIAL OR WORKMANSHIP THEREIN, LATENT OR PATENT, AS TO LANDLORD'S TITLE
THERETO, OR AS TO VALUE, COMPLIANCE WITH SPECIFICATIONS, LOCATION, USE,
CONDITION, MERCHANTABILITY, QUALITY, DESCRIPTION, DURABILITY OR OPERATION, IT
BEING AGREED THAT ALL RISKS INCIDENT THERETO ARE TO BE BORNE BY TENANT. Tenant
acknowledges that the Leased Premises are of its selection and to its
specifications, and that the Leased Premises have been inspected by Tenant and
are satisfactory to it. In the event of any defect or deficiency in any of the
Leased Premises of any nature, whether patent or latent, Landlord shall not have
any responsibility or liability with
respect thereto or for any incidental or consequential damages (including strict
liability in tort). The provisions of this Paragraph 3 (b) have been negotiated,
and the foregoing provisions are intended to be a complete exclusion and
negation of any warranties by Landlord, express or implied, with respect to any
of the Leased Premises, arising pursuant to the Uniform Commercial Code or any
other law now or hereafter in effect or otherwise.
(c) Tenant acknowledges and agrees that Tenant has examined the
title to the Leased Premises prior to the execution and delivery of this Lease
and has found such title to be satisfactory for the purposes contemplated by
this Lease.
(d) Landlord hereby assigns, without recourse or warranty
whatsoever, to Tenant, all Guaranties. Such assignment shall remain in effect
until the termination of this Lease. Landlord shall also retain the right to
enforce any Guaranties assigned in the name of Tenant upon the occurrence of an
Event of Default. Landlord hereby agrees to execute and deliver at Tenant's
expense such further documents, including powers of attorney, as Tenant may
reasonably request in order that Tenant may have the full benefit of the
assignment effected or intended to be effected by this Paragraph 3 (d). Upon the
termination of this Lease, the Guaranties shall automatically revert to
Landlord. The foregoing provision of reversion shall be self-operative and no
further instrument of reassignment shall be required. In confirmation of such
reassignment, Tenant shall execute and deliver promptly any certificate or other
instrument which Landlord may request. Any monies collected by Tenant under any
of the Guaranties after the occurrence of and during the continuation of an
Event of Default shall be held in trust by Tenant and promptly paid over to
Landlord.
(e) Landlord agrees to enter into, at Tenant's expense, such
Easements as reasonably requested by Tenant, subject to Lender's and Landlord's
approval of the form thereof, not to be unreasonably withheld or delayed;
provided, however, that no such Easement shall result in any diminution in the
value or utility of the Leased Premises for use as a storage warehouse and
distribution center and, further provided, that no such Easement shall render
the use of the Leased Premises dependent upon any other property or condition,
each of which Tenant shall certify to Landlord and Lender in writing delivered
with Tenant's request with respect to such Easement. Tenant's request shall also
include Tenant's written undertaking acknowledging that Tenant shall remain
liable hereunder as principal and not merely as a surety or guarantor
notwithstanding the establishment of any Easement. Except as expressly permitted
by this Lease, Landlord shall not enter into any Easements, REA's, restrictive
covenants or other matters affecting title to the Leased Premises, without the
prior consent of Tenant, which shall not be unreasonably withheld.
(f) Tenant agrees that Tenant is obligated to and shall perform
all obligations of the owner of the Leased Premises under and pay all expenses
which the owner of the Leased Premises may be required to pay in accordance with
any REA, and that Tenant shall comply with all of the terms and conditions of
the REA during the term of this Lease. Tenant further covenants and agrees to
indemnify, defend and hold harmless Landlord and Lender against any claim, loss
or damage suffered by Landlord or Lender by reason of Tenant's failure to
perform any obligations or pay any expenses as required under any REA or comply
with the terms and conditions of any REA as hereinabove provided during the term
of this Lease.
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4. Use of Leased Premises; Quiet Enjoyment.
(a) Tenant may use the Leased Premises as a storage, warehouse or
distribution center or for any other lawful purpose so long as such other lawful
purpose would not (i) have a material adverse effect on the value of the Leased
Premises, (ii) materially increase (when compared to use as a storage, warehouse
or distribution center) the likelihood that Tenant, Landlord or Lender would
incur liability under any provisions of any Environmental Laws, or (iii) result
in or give rise to any material environmental deterioration or degradation of
the Leased Premises. In no event shall the Leased Premises be used for any
purpose which shall violate any of the provisions of any Permitted Encumbrance
or any covenants, restrictions or agreements hereafter created by or consented
to by Tenant applicable to the Leased Premises. Tenant agrees that with respect
to the Permitted Encumbrances and any covenants, restrictions or agreements
hereafter created by or consented to by Tenant, Tenant shall observe, perform
and comply with and carry out the provisions thereof required therein to be
observed and performed by Landlord.
(b) Subject to Tenant's rights under Paragraph 18 hereof, Tenant
shall not permit any unlawful occupation, business or trade to be conducted on
the Leased Premises or any use to be made thereof contrary to applicable Legal
Requirements or Insurance Requirements. Subject to Tenant's rights under
Paragraph 18, Tenant shall not use, occupy or permit any of the Leased Premises
to be used or occupied, nor do or permit anything to be done in or on any of the
Leased Premises, in a manner which would (i) make void or voidable any insurance
which Tenant is required hereunder to maintain then in force with respect to any
of the Leased Premises, (ii) affect the ability of Tenant to obtain any
insurance which Tenant is required to furnish hereunder, or (iii) cause any
injury or damage to any of the Improvements unless pursuant to Alterations
permitted under Paragraph 12 hereof.
(c) Subject to all of the provisions of this Lease, so long as no
Event of Default exists hereunder, Landlord covenants to do no act to disturb
the peaceful and quiet occupation and enjoyment of the Leased Premises by
Tenant.
(d) Tenant covenants and agrees to remain in actual physical
possession of the Leased Premises and to continuously operate its business in
the Leased Premises; provided, however, from and after the commencement of the
sixty-first (61st) calendar month following the first Basic Rent Payment Date,
Tenant may, at its option (without any obligation to do so), cease to operate
its business in the Leased Premises on either a (i) permanent basis or (ii)
temporary basis.
5. Term
(a) Subject to the provisions hereof, Tenant shall have and hold
the Leased Premises for an initial term commencing on the Commencement Date and
ending on the Expiration Date.
(b) Provided (i) this Lease shall not have been terminated
pursuant to the provisions of Paragraph 13 (b) or 19, and (ii) an Event of
Default has not occurred and remains uncured, in each case on the applicable
date of its Renewal Option Notice and on the Expiration
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Date (or the expiration date of the then expiring Renewal Term, as applicable),
Tenant shall have five (5) consecutive options to extend the term of this Lease
for a Renewal Term, commencing upon the day after the Expiration Date (or the
expiration date of the then expiring Renewal Term, as applicable). If Tenant
elects to exercise any one or more of said renewal options, it shall do so by
giving a Renewal Option Notice to Landlord at any time during the Term (or the
then Renewal Term, as applicable) but, in any event, on or before that date
which is twelve (12) months prior to the commencement of the Renewal Term for
which such election is exercised. Tenant shall forever waive its right to
exercise a renewal option if it shall, for any reason whatsoever, fail to give
such Renewal Option Notice to Landlord within the time and in the manner
provided for the giving of such notice, whether such failure is inadvertent or
intentional, TIME BEING OF THE ESSENCE as to the exercise of such renewal option
and the giving of such notice. If Tenant shall elect to exercise any such
renewal option, the term of this Lease shall be automatically extended for five
(5) years without the execution of an extension or renewal lease. Any Renewal
Term shall be subject to all of the provisions of this Lease, and all such
provisions shall continue in full force and effect, except that the Basic Rent
for each Renewal Term shall be at the Basic Rent set forth for such renewal
terms on Exhibit B attached hereto. Within ten (10) days after request by
Landlord, Tenant shall execute, acknowledge and deliver to Landlord an
instrument confirming that such option has been effectively exercised,
confirming the extended expiration date of this Lease and confirming the Basic
Rent for the Renewal Term.
(c) With respect to the fifth Renewal Term, Landlord shall
designate an independent MAI appraiser to determine the fair market rental value
within twenty (20) days after Tenant's notice of its exercise of the renewal
option for such fifth Renewal Term. Within ten (10) days after selection of
Landlord's appraiser, Landlord shall notify Tenant of the determination made by
Landlord's appraiser with respect to the fair market rental value. Tenant shall
then have ten (10) days to dispute such determination and to select its own
independent MAI appraiser. In the event that Tenant fails to select its
appraiser within such ten (10) day period, the determination of Landlord's
appraiser shall constitute such fair market rental value. Within ten (10) days
after selection of Tenant's appraiser, the two appraisers shall meet and attempt
to agree as to the fair market rental value for the Leased Premises for the
fifth Renewal Term. In the event that such appraisers are unable to agree as to
such annual fair market rental value then: (i) if the difference between the two
determinations is less than five percent (5%) of the lower determination, then
the average of the two determinations shall be deemed to constitute such annual
fair market rental value; or (ii) if the difference between the two
determinations is equal to or greater than five percent (5%) of the lower
determination, then the two appraisers shall jointly select a third independent
MAI appraiser, which appraiser shall select which of the determinations of the
first two appraisers shall constitute such annual fair market rental value. Such
third appraiser shall not have the right to vary or modify the determinations of
the appraisers selected by Landlord and Tenant. Any appraiser selected pursuant
to this clause (c) must have at least ten (10) years experience in appraising
commercial real estate in the area in which the Leased Premises is located. The
appraisers shall not have the right to amend, modify or vary any of the terms of
this Lease and the determination of the appraisers in accordance with this
clause (c) shall be final, binding and conclusive upon Landlord and Tenant.
Subject to the provisions of this Paragraph and Paragraph 12 hereof, the fair
market rental value for the Leased Premises for the fifth Renewal Term shall
exclude the portion of fair market rental value
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attributable to (x) any Alterations for which all costs and expenses were paid
for by the Tenant, or (y) Tenant's Trade Fixtures.
6. Rent.
(a) Tenant shall pay to Landlord (or to Lender, if directed by
Landlord), as minimum annual rent for the Leased Premises during the Term, the
Basic Rent in arrears, on the Basic Rent Payment Dates, and shall pay the same
by ACH or other electronic means in immediately available federal funds or other
mutually agreed upon means in immediately available federal funds, by 11:30
a.m., New York time on the date due, to such account in such bank as Landlord
(or Lender, if Landlord directs Tenant to pay Basic Rent directly to Lender)
shall designate, from time to time. Basic Rent for the period from and including
the Commencement Date through and including March 31, 2004 shall be paid on the
Commencement Date in the amount equal to 1/31 of the monthly Basic Rent for the
initial term set forth on Exhibit "B" attached hereto for each day from and
including the Commencement Date through and including March 31, 2004. The first
Basic Rent Payment Date shall be April 30, 2004.
(b) Tenant shall pay and discharge before the imposition of any
fine, lien, interest or penalty that may be added thereto for late payment
thereof, as Additional Rent, all other amounts and obligations which Tenant
assumes or agrees to pay or discharge pursuant to this Lease, together with
every fine, penalty, interest and cost which may be added by the party to whom
such payment is due for nonpayment or late payment thereof. In the event of any
failure by Tenant to pay or discharge any of the foregoing, Landlord shall have
all rights, powers and remedies provided herein, by law or otherwise, in the
event of nonpayment of Basic Rent. All payments of Additional Rent that are
payable to Landlord shall be paid by Tenant by wire transfer in immediately
available federal funds to such account in such bank as Landlord (or Lender, if
so directed by Landlord) shall designate, from time to time.
(c) If any installment of Basic Rent is not paid within five (5)
days after the date the same is due, Tenant shall pay to Landlord, on demand, as
Additional Rent, a Late Charge.
(d) Landlord and Tenant agree that this Lease is a true lease and
does not represent a financing arrangement. Each party shall reflect the
transactions represented by this Lease in all applicable books, records and
reports (including, without limitation, income tax filings) in a manner
consistent with "true lease" treatment rather than "financing" treatment.
7. Net Lease; Non-Terminability.
(a) This is a net lease and Basic Rent, Additional Rent and all
other sums payable hereunder by Tenant shall be paid, except as otherwise
expressly set forth in this Lease, without notice, demand, setoff, counterclaim,
recoupment, abatement, suspension, deferment, diminution, deduction, reduction
or defense.
(b) Except as otherwise expressly provided in this Lease, this
Lease shall not terminate and Tenant shall not have any right to terminate this
Lease, during the Term. Except as otherwise expressly provided in this Lease,
Tenant shall not be entitled to any setoff,
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counterclaim, recoupment, abatement, suspension, deferment, diminution,
deduction, reduction or defense of or to Basic Rent, Additional Rent or any
other sums payable under this Lease; and except as otherwise expressly provided
in this Lease, the obligations of Tenant under this Lease shall not be affected
by any interference with Tenant's use of any of the Leased Premises for any
reason, including but not limited to the following: (i) any damage to or
destruction of any of the Leased Premises by any cause whatsoever, (ii) any
Condemnation, (iii) the prohibition, limitation or restriction of Tenant's use
of any of the Leased Premises, (iv) any eviction by paramount title or
otherwise, (v) Tenant's acquisition of ownership of any of the Leased Premises
other than pursuant to an express provision of this Lease, (vi) any default on
the part of Landlord under this Lease or under any other agreement, (vii) any
latent or other defect in, or any theft or loss of any of the Leased Premises,
(viii) the breach of any warranty of any seller or manufacturer of any of the
Equipment, (ix) any violation of Paragraph 4 (c) by Landlord, or (x) any other
cause, whether similar or dissimilar to the foregoing, any present or future Law
to the contrary notwithstanding. It is the intention of the parties hereto that
the obligations of Tenant under this Lease shall be separate and independent
covenants and agreements, and that Basic Rent, Additional Rent and all other
sums payable by Tenant hereunder shall continue to be payable in all events (or,
in lieu thereof , Tenant shall pay amounts equal thereto), and that the
obligations of Tenant under this Lease shall continue unaffected, unless this
Lease shall have been terminated pursuant to an express provision of this Lease.
(c) Tenant agrees that it shall remain obligated under this Lease
in accordance with its provisions and that, except as otherwise expressly
provided herein, it shall not take any action to terminate, rescind or avoid
this Lease, notwithstanding (i) the bankruptcy, insolvency, reorganization,
composition, readjustment, liquidation, dissolution, winding-up or other
proceeding affecting Landlord, (ii) the exercise of any remedy, including
foreclosure, under the Mortgage, or (iii) any action with respect to this Lease
(including the disaffirmance hereof) which may be taken by Landlord under the
Federal Bankruptcy Code or by any trustee, receiver or liquidator of Landlord or
by any court under the Federal Bankruptcy Code or otherwise.
(d) This Lease is the absolute and unconditional obligation of
Tenant. Tenant waives all rights which are not expressly stated in this Lease
but which may now or hereafter otherwise be conferred by law (i) to quit,
terminate or surrender this Lease or any of the Leased Premises, (ii) to any
setoff, counterclaim, recoupment, abatement, suspension, deferment, diminution,
deduction, reduction or defense of or to Basic Rent, Additional Rent or any
other sums payable under this Lease, except as otherwise expressly provided in
this Lease, and (iii) for any statutory lien or offset right against Landlord or
its property.
8. Payment of Impositions; Compliance with Legal Requirements and
Insurance Requirements.
(a) (i) Subject to the provisions of Paragraph 18 hereof
relating to contests, Tenant shall, before interest or penalties are due
thereon, pay and discharge all Impositions. If received by Landlord, Landlord
shall promptly deliver to Tenant any xxxx or invoice with respect to any
Imposition.
(i) Nothing herein shall obligate Tenant to pay, and the
term "Impositions" shall exclude, federal, state or local (A) transfer taxes as
the result of a conveyance
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by (or suffered by) Landlord (unless attributable to an Event of Default), (B)
franchise, capital stock or similar taxes if any, of Landlord, (C) income,
excess profits or other taxes, if any, of Landlord, determined on the basis of
or measured by its net income, (D) any estate, inheritance, succession, gift,
capital levy or similar taxes, unless the taxes referred to in clauses (B) and
(C) above are in lieu of or a substitute for any other tax or assessment upon or
with respect to any of the Leased Premises which, if such other tax or
assessment were in effect at the commencement of the Term, would be payable by
Tenant, or (E) any Tax that would not have been imposed but for the failure of
Indemnitee to comply with certification, information, documentation or other
reporting requirements applicable to Indemnitee, if compliance with such
requirements is required by statute or regulation of the relevant taxing
authority as a precondition to relief or exemption from such Tax. In the event
that any assessment against any of the Leased Premises may be paid in
installments, Tenant shall have the option to pay such assessment in
installments; and in such event, Tenant shall be liable only for those
installments which become due and payable during the Term. Tenant shall prepare
and file all tax reports required by governmental authorities which relate to
the Impositions. Tenant shall deliver to Landlord, within twenty (20) days after
Landlord's written request therefor, copies of all settlements and notices
pertaining to the Impositions which may be issued by any governmental authority
and receipts for payments of all Impositions made during each calendar year of
the Term, within thirty (30) days after payment.
(b) Subject to the provisions of Paragraph 18 hereof, Tenant shall
promptly comply with and conform to all of the Legal Requirements and Insurance
Requirements.
(c) All payments of Impositions shall be made by Tenant on an
After Tax Basis as to Landlord.
(d) Any amount payable to Landlord pursuant to this Paragraph 8
shall be paid within thirty (30) days after receipt of a written demand therefor
from Landlord accompanied by a written statement describing in reasonable detail
the amount so payable. Any payments required to be made by Tenant pursuant to
this Paragraph 8 that are not allowed to be paid directly to the appropriate
Governmental Authority or such other Person to whom such payment is due shall be
made directly to Landlord at the location and in the manner specified by
Landlord pursuant to Paragraph 6 hereof for the payment of Basic Rent. Any
amount payable by Tenant to Landlord under this Paragraph 8 that is not paid
when due shall bear interest at the Default Rate.
(e) If any report, return or statement (a "Filing") is required to
be filed with respect to any Imposition that is subject to this Xxxxxxxxx 0,
Xxxxxx shall, if permitted by Applicable Laws to do so, timely file or cause to
be filed such Filing with respect to such Imposition and shall promptly provide
notice of such filing to Landlord (except for any such Filing that Landlord has
notified Tenant in writing that Landlord intends to file) and will (if ownership
of the Leased Premises or any part thereof or interest therein is required to be
shown on such Filing) show the ownership of the Leased Premises in the name of
Landlord and send a copy of such Filing to Landlord. If Tenant is not permitted
by Applicable Laws to file any such Filing, Tenant will promptly notify Landlord
of such requirement in writing and prepare and deliver to Landlord a proposed
form of such Filing and such information as is within Tenant's reasonable
control or access with respect to such Filing within a reasonable time, and in
all
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events at least twenty (20) days, prior to the time such Filing is required to
be filed. Tenant shall hold Landlord harmless, on an After Tax Basis, from and
against any liabilities, including, but not limited to penalties, additions to
tax, fines and interest, arising out of any insufficiency or inaccuracy in any
such Filing, if such insufficiency or inaccuracy is attributable to Tenant.
(f) Notwithstanding anything herein to the contrary, any
obligations of Tenant under the provisions of this Paragraph 8 that accrue prior
to the expiration or earlier termination of this Lease shall survive such
expiration or earlier the termination of this Lease.
9. Liens; Recording and Title.
(a) Subject to the provisions of Paragraph 18 hereof, Tenant shall
not, directly or indirectly, create or permit to be created or to remain and
shall promptly discharge, any lien on the Leased Premises, on the Basic Rent,
Additional Rent or on any other sums payable by Tenant under this Lease, other
than the Mortgage, the Permitted Encumbrances and any mortgage, lien,
encumbrance or other charge created by or resulting from any act or omission by
Landlord or those claiming by, through or under Landlord (except Tenant). Notice
is hereby given that Landlord shall not be liable for any labor, services or
materials furnished or to be furnished to Tenant, or to anyone holding any of
the Leased Premises through or under Tenant, and that no mechanic's or other
liens for any such labor, services or materials shall attach to or affect the
interest of Landlord in and to any of the Leased Premises.
(b) Each of Landlord and Tenant shall execute, acknowledge and
deliver to the other a written Memorandum of this Lease to be recorded in the
appropriate land records of the jurisdiction in which the Leased Premises is
located, in order to give public notice and protect the validity of this Lease.
In the event of any discrepancy between the provisions of said recorded
Memorandum of this Lease and the provisions of this Lease, the provisions of
this Lease shall prevail.
(c) Nothing in this Lease and no action or inaction by Landlord
shall be deemed or construed to mean that Landlord has granted to Tenant any
right, power or permission to do any act or to make any agreement which may
create, give rise to, or be the foundation for, any right, title, interest or
lien in or upon the estate of Landlord in any of the Leased Premises.
10. Indemnification.
(a) Tenant agrees to assume liability for, and to indemnify, protect,
defend, save and keep harmless each Indemnitee, on an After-Tax Basis, from and
against any and all Claims that may be suffered, imposed on or asserted against
any Indemnitee (including any Claims resulting from any Indemnitee's
negligence), arising out of (i) the initial acquisition of the Leased Premises
by Landlord, ownership of the Leased Premises by Landlord, leasing by Landlord
of the Leased Premises to Tenant, subleasing of the Leased Premises by Tenant,
assignment by Tenant of its interest in this Lease, or sale of the Leased
Premises by Landlord to Tenant, transfer of title to Tenant's interest in this
Lease, renewal of this Lease, or operation, possession, use, non use,
maintenance, modification, alteration, construction, reconstruction,
restoration, or replacement of the Leased Premises (or any portion thereof), or
from the granting by Landlord at Tenant's request of easements, licenses or any
rights with respect to all or any
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part of the Leased Premises, or from the construction, design, purchase or
condition of the Leased Premises (including any Claims arising, directly or
indirectly, out of the actual or alleged presence, use, storage, generation or
Release of any Hazardous Materials, and any Claims for patent, trademark or
copyright infringement and latent or other defects, whether or not
discoverable), including any liability under Applicable Laws (including, without
limitation, any Claims arising directly or indirectly out of any actual or
alleged violation, now or hereafter existing, of any Environmental Laws), (ii)
the Lease or any modification, amendment or supplement thereto, (iii) the
non-compliance of the Leased Premises with Applicable Laws (including because of
the existence of the Permitted Encumbrances), (iv) any matter relating to all or
any part of the Leased Premises or any operations thereon, including matters
relating to Environmental Laws or Hazardous Materials, (v) the breach by Tenant
of its representations, warranties, covenants and obligations in this Lease
whether or not such Claim arises or accrues prior to the date of this Lease,
(vi) the business and activities of Tenant, (vii) the business and activities of
any other Person on or about the Leased Premises (whether as an invitee,
subtenant, licensee or otherwise), (viii) the cost of assessment, containment
and/or removal of any and all Hazardous Materials from all or any portion of the
Leased Premises or any surrounding areas for which Tenant has any legal
obligation, the cost of any actions taken in response to a Release of any
Hazardous Materials on, in, under or affecting any portion of the Leased
Premises or any surrounding areas for which Tenant has any legal obligation to
prevent or minimize such Release so that it does not migrate or otherwise cause
or threaten danger to present or future public health, safety, welfare or the
environment, and costs incurred to comply with Environmental Laws in connection
with all or any portion of the Leased Premises or any surrounding areas for
which Tenant has any legal obligation, and (ix) an Event of Default.
Notwithstanding the foregoing, (1) nothing herein shall be construed to obligate
Tenant to indemnify, defend and hold harmless any Indemnitee from and against
any Claims imposed on or incurred by such Indemnitee by reason of such
Indemnitee's willful misconduct or gross negligence or by reason of any liens
and liabilities of Landlord solely in connection with any financing by Landlord
of the Leased Premises, and (2) the foregoing indemnity shall specifically not
include any such Claims that arise or accrue solely with respect to events,
activities, operations or actions that occur after both the expiration or
earlier termination of this Lease and the surrender of the Leased Premises to
Landlord in accordance with the terms of this Lease.
(b) In case any Claim shall be made or brought against any
Indemnitee, such Indemnitee shall give prompt notice thereof to Tenant; provided
that failure to so notify Tenant shall not reduce Tenant's obligations to
indemnify any Indemnitee hereunder unless and only to the extent such failure
results in additional liability on Tenant's part. Tenant shall be entitled, at
its expense, acting through counsel selected by Tenant (and reasonably
satisfactory to such Indemnitee), to participate in, or, except as otherwise
provided, to assume and control (if it promptly so elects upon notice of the
Claim), and, to the extent that Tenant desires to assume and control, in
consultation with Indemnitee, the negotiation, litigation and/or settlement of
any such Claim (subject to the provisions of the last sentence of subparagraph
(c) of this Paragraph 10). Such Indemnitee may (but shall not be obligated to)
participate at its own expense (unless Tenant is not properly performing its
obligations hereunder and then at the expense of Tenant) and with its own
counsel in any proceeding conducted by Tenant in accordance with the foregoing,
in which case Tenant shall keep such Indemnitee and its counsel fully informed
of all proceedings and filings and afford such Indemnitee and counsel reasonable
opportunity for comment. Notwithstanding the foregoing, Tenant shall not be
entitled to assume and control the defense of
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any Claim if (i) an Event of Default has occurred and is continuing, (ii) the
proceeding involves possible imposition of any criminal liability or penalty or
unindemnified civil penalty on such Indemnitee, (iii) the proceeding involves
the granting of injunctive relief against the Indemnitee not related to this
Lease, (iv) a significant counterclaim is available to the Indemnitee that would
not be available to and cannot be asserted by Tenant, (v) a conflict of interest
exists between the Indemnitee and Tenant with respect to the Claim, or (vi) the
defense of such Claim would require the delivery of material confidential and
proprietary information of such Indemnitee that would otherwise not be available
to Tenant or its counsel.
(c) Upon payment in full of any Claim by Tenant pursuant to this
Paragraph 10 to or on behalf of an Indemnitee, Tenant, without any further
action, shall be subrogated to any and all Claims that such Indemnitee may have
relating thereto (other than claims in respect of insurance policies maintained
by such Indemnitee at its own expense or claims against another Indemnitee for
which Tenant would have indemnity obligations hereunder) to the extent of such
payment, and such Indemnitee shall execute such instruments of assignment and
conveyance, evidence of Claims and payment and such other documents, instruments
and agreements as may be necessary to preserve any such Claims and otherwise
reasonably cooperate with Tenant to enable Tenant to pursue such Claims.
(d) Notwithstanding anything to the contrary contained herein,
Tenant shall not be required to indemnify any Indemnitee under this Paragraph 10
for any Claim to the extent resulting from the material misrepresentation, gross
negligence or willful misconduct of such Indemnitee.
(e) The obligations of Tenant under this Paragraph 10 shall
survive any termination of this Lease.
11. Maintenance and Repair.
(a) Except for any Alterations that Tenant is permitted to make
pursuant to this Lease, Tenant shall at all times, including any Requisition
period, put, keep and maintain the Leased Premises (including, without
limitation, the roof, landscaping, walls, footings, foundations and structural
components of the Leased Premises) and the Equipment in the same (or better)
condition and order of repair as exists as of the date of this Lease, except for
ordinary wear and tear, and shall promptly make all repairs and replacements of
every kind and nature, whether foreseen or unforeseen, which may be required to
be made upon or in connection with the Leased Premises in order to keep and
maintain the Leased Premises in the order and condition required by this
Paragraph 11(a). Tenant shall do or cause others to do all shoring of the Leased
Premises or of foundations and walls of the Improvements and every other act
necessary or appropriate for preservation and safety thereof, by reason of or in
connection with any excavation or other building operation upon any of the
Leased Premises, whether or not Landlord shall, by reason of any Legal
Requirements or Insurance Requirements, be required to take such action or be
liable for failure to do so. LANDLORD SHALL NOT BE REQUIRED TO MAKE ANY REPAIR,
WHETHER FORESEEN OR UNFORESEEN, OR TO MAINTAIN ANY OF THE LEASED PREMISES OR
ADJOINING PROPERTY IN ANY WAY, AND TENANT HEREBY EXPRESSLY WAIVES THE RIGHT TO
MAKE REPAIRS AT THE EXPENSE OF THE LANDLORD, WHICH RIGHT MAY BE PROVIDED FOR IN
ANY LAW
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NOW OR HEREAFTER IN EFFECT. Nothing in the preceding sentence shall be deemed to
preclude Tenant from being entitled to insurance proceeds or condemnation awards
for Restoration pursuant to Paragraphs 13 (c) and 14 (g) of this Lease. Tenant
shall, in all events, make all repairs for which it is responsible hereunder
promptly, and all repairs shall be in a good, proper and workmanlike manner.
(b) Subject to Section 18 hereof, in the event that any
Improvement shall violate any Legal Requirements or Insurance Requirements and
as a result of such violation enforcement action is commenced against Tenant or
with respect to the Leased Premises, then Tenant, at the request of Landlord,
shall either (i) obtain valid and effective waivers or settlements of all
claims, liabilities and damages resulting from each such violation, whether the
same shall affect Landlord, Tenant or both, or (ii) take such action as shall be
necessary to remove such violation, including, if necessary, any Alteration. Any
such repair or Alteration shall be made in conformity with the provisions of
Paragraph 12.
(c) If Tenant shall be in default under any of the provisions of
this Xxxxxxxxx 00, Xxxxxxxx may after thirty (30) business days written notice
given to Tenant and failure of Tenant to cure during said period, but without
notice in the event of an emergency, do whatever is necessary to cure such
default as may be appropriate under the circumstances for the account of and at
the expense of Tenant. In the event of an emergency Landlord shall notify Tenant
of the situation by phone or other available communication. All reasonable sums
so paid by Landlord and all reasonable costs and expenses (including, without
limitation, attorneys' fees and expenses) so incurred, together with interest
thereon at the Default Rate from the date of payment or incurring the expense,
shall constitute Additional Rent payable by Tenant under this Lease and shall be
paid by Tenant to Landlord on demand.
(d) Tenant shall from time to time replace with Replacement
Equipment any of the Equipment which shall have become worn out or unusable for
the purpose for which it is intended, been taken by a Condemnation as provided
in Paragraph 13, or been lost, stolen, damaged or destroyed as provided in
Paragraph 14. Tenant shall repair at its sole cost and expense all damage to the
Leased Premises caused by the removal of Equipment or Replaced Equipment or
other personal property of Tenant or the installation of Replacement Equipment.
All Replacement Equipment (except for Trade Fixtures) shall become the property
of Landlord, shall be free and clear of all liens and rights of others and shall
become a part of the Equipment as if originally demised herein.
12. Alterations.
(a) Upon prior written notice to Landlord and Lender (if Tenant
has been given notice of the name and address of such Lender), Tenant shall have
the right to make any Alteration(s) to the Leased Premises, the cost of which
does not exceed $500,000 in the aggregate, in any calendar year; provided, that
Tenant complies with clause (c) of this Paragraph 12. The cost of any Trade
Fixtures installed by Tenant shall not be considered an Alteration for purposes
of this Section 12.
(b) Upon prior written notice to Landlord and Lender (if Tenant
has been given notice of the name and address of such Lender), Tenant shall have
the right to make any
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Alteration(s) to the Leased Premises, the cost of which exceeds $500,000 in the
aggregate, in any calendar year; provided, that, (i) no Event of Default under
this Lease has occurred and is then continuing, (ii) Tenant complies with clause
(c) of this Paragraph 12, and (iii) prior to making any such Alteration(s),
Tenant shall provide Landlord with the plans and specifications, estimated
budgets and proposed schedule of construction with respect thereto.
(c) In the event that Landlord gives its prior written consent to
any Alterations, or if such consent is not required, Tenant agrees that in
connection with any Alteration: (i) the fair market value of the Leased Premises
shall not be lessened after the completion of any such Alteration, or its
structural integrity impaired; (ii) the Alteration and any Alteration
theretofore made or thereafter to be made shall not in the aggregate reduce the
gross floor area of the Improvements by more than ten percent (10%); (iii) all
such Alterations shall be performed in a good and workmanlike manner, and shall
be expeditiously completed in compliance with all Legal Requirements; (iv) no
such Alteration shall change the permitted use of the Leased Premises (as
described in Paragraph 4 hereof), (v) all work done in connection with any such
Alteration shall comply with all Insurance Requirements; (vi) Tenant shall
promptly pay all costs and expenses of any such Alteration (unless such costs
are funded through a financing by Landlord, as described in Paragraph 12(e)
below), and shall (subject to and in compliance with the provisions of Paragraph
18 hereof) discharge all liens (excluding liens created solely by Landlord)
filed against any of the Leased Premises arising out of the same; (vii) Tenant
shall procure and pay for all permits and licenses required in connection with
any such Alteration; (viii) all such Alterations (excluding Trade Fixtures)
shall be the property of Landlord and shall be subject to this Lease; (ix) no
such Alteration shall create any debt or other encumbrance(s) on the Leased
Premises (except as described in Paragraph 12(e) below), and (x) in the case of
any Alteration the estimated cost of which in any one instance exceeds Five
Hundred Thousand and 00/100 Dollars ($500,000.00), such Alterations shall be
made under the supervision of an architect or engineer and in accordance with
plans and specifications which shall be submitted to Landlord (for informational
purposes only) prior to the commencement of the Alterations.
(d) All Alterations (excluding Trade Fixtures installed in
connection therewith) shall become the property of Landlord, shall be free and
clear of all liens and rights of others and shall become a part of the Leased
Premises as if originally demised herein.
(e) Tenant may request additional funding from Landlord in order
to pay for the costs and expenses of any Alteration that complies with this
Paragraph 12. Landlord shall use commercially reasonable efforts to obtain such
additional funding, subject to a proportional adjustment in Basic Rent. If
Landlord is unable to obtain such additional funding (in whole or in part), or
if Tenant shall reject the terms of such additional funding, Tenant shall either
(i) pay for the costs and expenses of such Alteration on Tenant's own account,
(ii) pay (on Tenant's own account) for any deficiency between the costs and
expenses of such Alteration and the additional funding obtained by Landlord, or
(iii) forego such Alteration.
13. Condemnation.
(a) Tenant, promptly upon obtaining knowledge of the institution
of any proceeding for Condemnation, shall notify Landlord thereof and Landlord
shall be entitled to
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participate in any Condemnation proceeding. Landlord, promptly after obtaining
knowledge of the institution of any proceeding for Condemnation, shall notify
Tenant thereof and Tenant shall have the right, at its sole cost and expense, to
participate in such proceedings. Subject to the provisions of this Paragraph 13
and Paragraph 15, Tenant hereby irrevocably assigns to Lender or to Landlord, in
that order, any award or payment in respect of any Condemnation of Landlord's
interest in the Leased Premises, except that (except as hereinafter provided)
nothing in this Lease shall be deemed to assign to Landlord or Lender any
Tenant's Award to the extent Tenant shall have a right to make a separate claim
therefor against the condemnor, it being agreed, however, that Tenant shall in
no event be entitled to any payment that reduces the award to which Landlord is
or would be entitled for the condemnation of Landlord's interest in the Leased
Premises. Notwithstanding the foregoing (but subject to Paragraph 13(c)(iii)
hereof), Tenant shall be entitled to Tenant's Award only in the event of a
Condemnation described in Paragraph 13(b)(i)(A) and then only to the extent
that, when such award is subtracted from the entire award in respect to all
interests in the Leased Premises, the remainder exceeds the amount set forth on
Exhibit "D" attached hereto and made a part hereof.
(i) If (I) the entire Leased Premises, (II) a material
portion of the Land or the building constructed on the Land or any means of
ingress, egress or access to the Leased Premises, the loss of which even after
restoration would, in Tenant's reasonable business judgment, be substantially
and materially adverse to the business operations of Tenant at the Leased
Premises, or (III) any means of ingress, egress or access to the Leased Premises
which does not result in at least one method of ingress and egress to and from
the Leased Premises remaining, provided the same is permitted under then
existing Legal Requirements, shall be subject of a Taking by a duly constituted
authority or agency having jurisdiction, then Tenant may, not later than ninety
(90) days after such Taking has occurred, serve a Tenant's Termination Notice
upon Landlord.
(A) In the event that during the Initial Term (but not
during any Renewal Term) Tenant shall serve a Tenant's Termination Notice upon
Landlord, Tenant shall, as part of such Tenant's Termination Notice, offer
(which offer may be rejected by Landlord as set forth below) to purchase the
Leased Premises and the entire award for the Purchase Price plus any and all
Additional Payments.
(B) If Landlord and Lender (if there shall be a Lender
at such time) shall not elect to accept Tenant's offer to purchase, Landlord
shall give notice thereof to Tenant within ninety (90) days after the giving of
Tenant's Termination Notice.
(C) Should an offer to purchase not be accepted by
Landlord and Lender (if there shall be a Lender at such time), this Lease shall
be terminated as above provided and the Net Award made in the Condemnation
proceeding with respect to the Leased Premises shall be paid to Lender or to
Landlord in that order.
(D) Landlord's notice not to accept Tenant's offer to
purchase shall be void and of no effect unless accompanied by the written notice
of Lender (if there shall be a Lender at such time) to the effect that such
Lender also elects not to accept Tenant's offer to purchase. Should said notices
of Landlord and Lender (if any) rejecting Tenant's offer to
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purchase not be served within said period of ninety (90) days, then and in that
event, the said offer shall be deemed accepted.
(E) During the period of time between the condemnation
and the Closing Date, this Lease shall stay in full force and effect and Tenant
shall remain fully liable hereunder.
(F) In the event that Landlord and Lender (if there
shall be a Lender at such time) shall accept or be deemed to have accepted
Tenant's offer to purchase, title shall close and the Purchase Price and
Additional Payments shall be paid as hereinafter provided and in such event
Tenant shall be entitled to and shall receive any and all awards with respect to
the Leased Premises then or thereafter made in the Condemnation proceeding and
Landlord shall assign (or in case of any award previously made, deliver (or
cause Lender to deliver, if applicable) to Tenant on the Closing Date) such
award as may be made with respect to the Leased Premises. In the event Landlord
and Lender (if applicable) shall accept Tenant's offer to purchase with respect
to the Leased Premises, or be deemed to have accepted such Tenant's offer, title
shall close on the Closing Date, at noon at the local office of Landlord's
counsel, or at such other time and place as the parties hereto may agree upon in
writing, and this Lease shall be automatically extended to and including the
Closing Date and Tenant shall pay the Purchase Price and Additional Payments by
transferring immediate funds to such account or accounts and in such bank or
banks as Lender or Landlord, in that order, shall designate, upon delivery of a
special warranty deed (or local equivalent) conveying the Leased Premises and
all other required documents including a xxxx of sale with respect to all
personal property constituting a portion of the Leased Premises and an
assignment of any award in connection with the taking of Leased Premises. The
special warranty deed (or local equivalent) shall convey title, free from
encumbrances other than (A) Permitted Encumbrances, (B) liens or encumbrances
created or suffered by Tenant or arising by reason of the failure of Tenant to
observe or perform any of the terms, covenants or agreements herein provided to
be observed and performed by Tenant, (C) any installments of Impositions then
affecting the Leased Premises, and (D) this Lease. The Purchase Price and
Additional Payments payable as hereinabove provided shall be charged or
credited, as the case may be, on the Closing Date, to reflect adjustments of
Basic Rent paid or payable to and including the Closing Date, apportioned as of
the Closing Date. Tenant shall pay all conveyance, transfer, sales and like
taxes required in connection with the purchase, regardless of who is required to
pay such taxes under State or local law or custom (and Tenant shall also pay to
Landlord any amount necessary to yield to Landlord the entire Purchase Price and
Additional Payments if as a matter of the law of the State or locality such tax
cannot be paid directly by Tenant). If there be any liens or encumbrances
against the Leased Premises which Landlord is obligated to remove, Landlord
shall provide at the Closing separate funds for the foregoing, payable to the
holder of such lien or encumbrances.
(ii) In the event that during any Renewal Term, Tenant shall
serve a Tenant's Termination Notice upon Landlord, this Lease and the Term
hereof shall terminate on the Termination Date specified in the Termination
Notice; and in such event the Net Award to be made in the Condemnation
proceeding shall be paid to Lender or to Landlord, in that order.
(b) (i) In the event of a Condemnation of any part of the Leased
Premises which does not result in a termination of this Lease, subject to the
requirements of Paragraph 15,
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the Net Award of such Condemnation shall be retained by Landlord; and promptly
after such Condemnation, Tenant shall commence and diligently continue to
completion the Restoration of the Leased Premises.
(ii) Upon the payment to Landlord of the Net Award of a
Taking which falls within the provisions of this Paragraph 13(c), Landlord and
Lender shall, to the extent received, make the Restoration Award available to
Tenant for Restoration, in accordance with the provisions of Paragraph 15, and
promptly after completion of the Restoration, the balance of the Net Award shall
be paid to Tenant and all Basic Rent, Additional Rent and other sums payable
hereunder shall continue unabated and unreduced.
(iii) In the event of a Requisition of the Leased Premises,
Landlord shall apply the Net Award of such Requisition, to the extent available,
to the installments of Basic Rent, Additional Rent or other sums payable by
Tenant hereunder thereafter payable and Tenant shall pay any balance remaining
thereafter. Upon the expiration of the Term, any portion of such Net Award which
shall not have been previously credited to Tenant on account of the Basic Rent
and Additional Rent shall be retained by Landlord.
(iv) Except with respect to an award or payment to which
Tenant is entitled pursuant to the provisions of Paragraph 13 (a), 13 (b) and 13
(c), no agreement with any condemnor in settlement of or under threat of any
Condemnation shall be made by either Landlord or Tenant (provided no Event of
Default then exists and is continuing) without the written consent of the other,
and of Lender, if the Leased Premises are then subject to a Mortgage, which
consent shall not be unreasonably withheld or delayed.
14. Insurance.
(a) Tenant shall maintain at its sole cost and expense the
following insurance on the Leased Premises:
(i) Insurance against loss or damage to the Improvements and
Equipment under a fire and broad form of all risk extended coverage insurance
policy (which shall include flood insurance if the Leased Premises is located
within a flood hazard area and which shall include earthquake insurance if the
Leased Premises is located in an area where earthquake insurance is customarily
maintained for similar commercial properties). Such insurance shall be in
amounts sufficient to prevent Landlord or Tenant from becoming a co-insurer
under the applicable policies, and in any event in amounts not less than the
actual replacement cost of the Improvements and Equipment (excluding footings
and foundations and other parts of the Improvements which are not insurable) as
determined from time to time at either Lender's or Landlord's request but not
more frequently than once in any 12-month period, by agreement of Landlord,
Lender and Tenant, or if not so agreed, at Tenant's expense, by the insurer or
insurers or by an appraiser approved by Landlord. Such insurance policies may
contain reasonable exclusions and deductible amounts, all in accordance with
industry standards.
(ii) Contractual and comprehensive general liability
insurance against claims for bodily injury, death or property damage occurring
on, in or about the Leased Premises, which insurance shall be written on a
so-called "Occurrence Basis", and shall provide
-15-
minimum protection with a combined single limit in an amount not less than the
greater of (x) Five Million ($5,000,000) Dollars (or in such increased limits
from time to time to reflect declines in the purchasing power of the dollar as
Landlord may reasonably request) or (y) the aggregate amount of such insurance
carried by Tenant, for bodily injury, death and property damage in any one
occurrence.
(iii) Worker's compensation insurance covering all persons
employed by Tenant on the Leased Premises in connection with any work done on or
about any of the Leased Premises for which claims for death or bodily injury
could be asserted against Landlord, Tenant or the Leased Premises.
(iv) Intentionally deleted;
(v) Insurance against loss or damage from explosion of any
steam or pressure boilers or similar apparatus located in or about the
Improvements in an amount not less than the actual replacement cost of the
Improvements and Equipment (excluding footings and foundations and other parts
of the Improvements which are not insurable).
(vi) Such additional and/or other insurance with respect to
the Improvements located on the Leased Premises and in such amounts as at the
time is customarily carried by prudent owners or tenants with respect to
improvements similar in character, location and use and occupancy to the
Improvements located on the Leased Premises.
(b) So long as (i) no Event of Default has occurred and is
continuing, (ii) the consolidated Tangible Net Worth of Lease Guarantor is not
less than Two Hundred Million ($200,000,000.00) Dollars as determined in
accordance with generally accepted accounting principles consistently applied,
and (iii) Lease Guarantor maintains a designation of NAIC II or better as rated
by the National Association of Insurance Commissioners ("NAIC") (unless required
by the Securities Evaluation Office of the NAIC to be a rating of NAIC I with
the respect to the continued treatment of this Lease as a credit tenant lease,
in which event Lease Guarantor must maintain a designation of NAIC I), Tenant
may self-insure all or any portion of the coverage referred to in Paragraph
14(a) above. Evidence of such self-insurance shall be in the form attached
hereto as Exhibit "I".
(c) The insurance required by Paragraph 14(a) shall be written by
companies having a claims paying ability rating by Standard & Poor's of not less
than A-, and all such companies shall be authorized to do an insurance business
in the State, or otherwise agreed to by Landlord and Lender. The insurance
policies (i) shall be in amounts sufficient at all times to satisfy any
coinsurance requirements thereof, and (ii) shall (except for the worker's
compensation insurance referred to in Paragraph 14 (a) (iii) hereof) name
Landlord, Tenant and any Lender whose name and address have been provided to
Tenant as additional insured parties, as their respective interests may appear.
If said insurance or any part thereof shall expire, be withdrawn, become void by
breach of any condition thereof by Tenant or become void or unsafe by reason of
the failure or impairment of the capital of any insurer, Tenant shall
immediately obtain new or additional insurance reasonably satisfactory to
Landlord and Lender.
-16-
(d) Each insurance policy referred to in clauses (i), (iv), (v)
(and (vi) if requested by Lender) of Paragraph 14 (a), shall contain standard
non-contributory mortgagee clauses in favor of any Lender whose name and address
have been provided to Tenant. Each policy shall provide that it may not be
canceled except after thirty (30) days' prior notice to Landlord and any such
Lender. Each policy shall also provide that any losses otherwise payable
thereunder shall be payable notwithstanding (i) any act or omission of Landlord
or Tenant which might, absent such provision, result in a forfeiture of all or a
part of such insurance payment, or (ii) the occupation or use of any of the
Leased Premises for purposes more hazardous than permitted by the provisions of
such policy. Each policy shall also provide evidence of such insurance to
Landlord and any Lender which holds a Mortgage on the Leased Premises on an
ACCORD 27 form or equivalent; provided, that in the event that such form is no
longer available, such evidence of insurance is in a form reasonably
satisfactory to Landlord and Lender.
(e) Tenant shall pay as they become due all premiums for the
insurance required by this Paragraph 14, shall renew or replace each policy, and
shall deliver to Landlord and Lender a certificate or other evidence (reasonably
satisfactory to Lender and Landlord) of the existing policy and such renewal or
replacement policy at least five (5) days prior to the Insurance Expiration Date
of each policy. Each such policy shall provide that it shall not expire until
the Landlord and any Lender listed as additional insured or loss payee shall
receive a notice from the insurer to the effect that such policy will expire on
the Insurance Expiration Date, as set forth in such notice, which shall be
thirty (30) days following the date of the receipt by Landlord and such Lender
of such notice. In the event of Tenant's failure to comply with any of the
foregoing requirements of this Paragraph 14 within five (5) business days of the
giving of written notice by Landlord to Tenant, Landlord shall be entitled to
procure such insurance. Any sums expended by Landlord in procuring such
insurance shall be Additional Rent and shall be repaid by Tenant, together with
interest thereon at the Default Rate, from the time of payment by Landlord until
fully paid by Tenant immediately upon written demand therefor by Landlord.
(f) Anything in this Paragraph 14 to the contrary notwithstanding,
any insurance which Tenant is required to obtain pursuant to Paragraph 14(a) may
be carried under a "blanket" policy or policies covering other properties or
liabilities of Tenant, provided that such "blanket" policy or policies otherwise
comply with the provisions of this Paragraph 14. In the event any such insurance
is carried under a blanket policy, Tenant shall deliver to Landlord and Lender
evidence of the issuance and effectiveness of the policy, the amount and
character of the coverage with respect to the Leased Premises and the presence
in the policy of provisions of the character required in the above sections of
this Paragraph 14.
(g) In the event of any casualty loss exceeding $350,000, Tenant
shall give Landlord immediate notice thereof. Tenant shall adjust, collect and
compromise any and all claims, with the consent of Lender and Landlord, not to
be unreasonably withheld or delayed, and Landlord and Lender shall have the
right to join with Tenant therein. If the estimated cost of Restoration or
repair shall be Three Hundred Fifty Thousand ($350,000.00) Dollars or less, all
proceeds of any insurance required under clauses (i), (iv), (v) (and (vi) if
requested by Lender) of Paragraph 14(a) shall be payable to Tenant, provided
that Tenant (or the Lease Guarantor) at such time shall have a Tangible Net
Worth of not less than Two Hundred Million ($200,000,000.00) Dollars as
determined in accordance with generally accepted accounting
-17-
principles, consistently applied, and in all other events to a Trustee. If the
Leased Premises shall be covered by a Mortgage, Lender, if it so desires, shall
be the Trustee. Each insurer is hereby authorized and directed to make payment
under said policies directly to such Trustee instead of to Landlord and Tenant
jointly; and Tenant and Landlord each hereby appoints such Trustee as its
attorney-in-fact to endorse any draft therefor for the purposes set forth in
this Lease after approval by Tenant of such Trustee, if Trustee is other than
Lender. Except as expressly set forth below, in the event of any casualty
(whether or not insured against) resulting in damage to the Leased Premises or
any part thereof, the Term shall nevertheless continue and there shall be no
abatement or reduction of Basic Rent, Additional Rent or any other sums payable
by Tenant hereunder. The Net Proceeds of such insurance payment shall be
retained by the Trustee and, promptly after such casualty, Tenant, as required
in Paragraphs 11 (a) and 12, shall commence and diligently continue to perform
the Restoration to the Leased Premises. Upon payment to the Trustee of such Net
Proceeds, the Trustee shall, to the extent available, make the Net Proceeds
available to Tenant for restoration, in accordance with the provisions of
Paragraph 15. Subject to Paragraph 14(h), Tenant shall, whether or not the Net
Proceeds are sufficient for the purpose, promptly repair or replace the
Improvements and Equipment in accordance with the provisions of Paragraph 11(a)
and the Net Proceeds of such loss shall thereupon be payable to Tenant, subject
to the provisions of Paragraph 15 hereof. In the event that any damage or
destruction shall occur at such time as Tenant shall not have maintained
third-party insurance in accordance with Paragraph 14(a)(i),(iv),(v) or (vi),
Tenant shall pay to the Trustee Tenant's Insurance Payment. Notwithstanding
anything herein to the contrary, all proceeds of any business interruption
insurance maintained by Tenant shall be payable directly to Tenant.
(h) (i) If the cost of Restoration exceeds seventy-five percent
(75%) or more of the replacement value of the Leased Premises, then Tenant may,
not later than ninety (90) days after such casualty has occurred, serve a
Tenant's Termination Notice upon Landlord.
(ii) In the event that during the Initial Term (but not
during any Renewal Terms) Tenant shall serve a Tenant's Termination Notice upon
Landlord, Tenant shall, as part of such Tenant's Termination Notice offer (which
offer may be rejected by Landlord as set forth below) to purchase the Leased
Premises and the insurance proceeds for the Purchase Price plus any and all
Additional Payments.
(iii) If Landlord and Lender (if there shall be a Lender at
such time) shall not elect to accept Tenant's offer to purchase, Landlord shall
give notice thereof to Tenant within ninety (90) days after the giving of
Tenant's Termination Notice.
(iv) Should an offer to purchase not be accepted by Landlord
and Lender (if there shall be a Lender at such time), this Lease shall terminate
on the Termination Date, Tenant shall have no obligation to commence or complete
the Restoration and the entire amount of insurance proceeds (or the entire
amount of Tenant's Insurance Payment, as applicable) payable in connection with
such casualty (other than Tenant's business interruption insurance proceeds)
shall be paid to Lender or to Landlord in that order.
(v) Landlord's notice not to accept Tenant's offer to
purchase shall be void and of no effect unless accompanied by the written notice
of Lender (if there shall be a Lender at such time) to the effect that such
Lender also elects not to accept Tenant's offer to
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purchase. Should said notices of Landlord and Lender (if applicable) rejecting
Tenant's offer to purchase not be served within said period of ninety (90) days,
then and in that event, the said offer shall be deemed accepted.
(vi) In the event that Landlord and Lender (if there shall be
a Lender at such time) shall accept or be deemed to have accepted Tenant's offer
to purchase, title shall close and the Purchase Price and Additional Payments
shall be paid as hereinafter provided and in such event Tenant shall be entitled
to and shall receive any and all insurance proceeds with respect to the Leased
Premises then or thereafter paid in connection with the casualty and Landlord
shall assign (or in case of any insurance proceeds previously paid to Landlord,
Trustee or Lender, deliver (or cause to be delivered) to Tenant on the Closing
Date) such insurance proceeds as may be paid with respect to the Leased Premises
in connection with such casualty. In the event Landlord and Lender (if
applicable) shall accept Tenant's offer to purchase with respect to the Leased
Premises, or be deemed to have accepted such Tenant's offer, title shall close
on the Closing Date, at noon at the local office of Landlord's counsel, or at
such other time and place as the parties hereto may agree upon, this Lease shall
be automatically extended to and including the Closing Date and Tenant shall pay
the Purchase Price and Additional Payments by transferring immediate funds to
such account or accounts and in such bank or banks as Lender or Landlord, in
that order, shall designate, upon delivery of a special warranty deed (or local
equivalent) conveying Leased Premises and all other required documents including
a xxxx of sale with respect to all personal property constituting a portion of
the Leased Premises and an assignment of any insurance proceeds in connection
with the casualty. The special warranty deed (or local equivalent) shall convey
title, free from encumbrances other than (A) Permitted Encumbrances, (B) liens
or encumbrances created or suffered by Tenant or arising by reason of the
failure of Tenant to observe or perform any of the terms, covenants or
agreements herein provided to be observed and performed by Tenant, (C) any
installments of Impositions then affecting the Leased Premises, and (D) this
Lease. The Purchase Price and Additional Payments payable as hereinabove
provided shall be charged or credited, as the case may be, on the Closing Date,
to reflect adjustments of Basic Rent paid or payable to and including the
Closing Date, apportioned as of the Closing Date. Tenant shall pay all
conveyance, transfer, sales and like taxes required in connection with the
purchase, regardless of who is required to pay such taxes under State or local
law or custom (and Tenant shall also pay to Landlord any amount necessary to
yield to Landlord the entire Purchase Price and Additional Payments if as a
matter of the law of the State or locality such tax cannot be paid directly by
Tenant). If there be any liens or encumbrances against the Leased Premises which
Landlord is obligated to remove, Landlord shall provide at the Closing separate
funds for the foregoing, payable to the holder of such lien or encumbrances.
(vii) During the period of time between the casualty and the
Closing Date, this Lease shall stay in full force and effect and Tenant shall
remain fully liable hereunder.
(viii) In the event that during any Renewal Term, Tenant shall
serve a Tenant's Termination Notice upon Landlord, this Lease and the Term
hereof shall terminate on the Termination Date specified in the Termination
Notice; and in such event Tenant shall have no obligation to commence or
complete the Restoration and all of the insurance proceeds payable in connection
with the casualty (other than Tenant's business interruption insurance proceeds)
shall be paid to Lender or to Landlord, in that order.
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15. Restoration. The Restoration Fund shall be disbursed by the Trustee
in accordance with the following conditions:
(a) If the cost of Restoration will exceed $350,000, prior to
commencement of the Restoration the architects, general contractor(s), and plans
and specifications for the Restoration shall be approved by Landlord, which
approval shall not be unreasonably withheld or delayed; and which approval shall
be granted to the extent that the plans and specifications depict a Restoration
which is substantially similar to the Improvements and Equipment which existed
prior to the occurrence of the casualty or Taking, whichever is applicable.
(b) At the time of any disbursement, no Event of Default shall
exist and no mechanics' or materialmen's liens shall have been filed and remain
undischarged or unbonded.
(c) Disbursements shall be made from time to time in an amount not
exceeding the hard and soft cost of the work and costs incurred since the last
disbursement upon receipt of (1) satisfactory evidence, including architects'
certificates of the stage of completion, of the estimated cost of completion and
of performance of the work to date in a good and workmanlike manner in
accordance with the contracts, plans and specifications, (2) partial releases of
liens, and (3) other reasonable evidence of cost and payment so that Landlord
can verify that the amounts disbursed from time to time are represented by work
that is completed in place or delivered to the site and free and clear of
mechanics' lien claims.
(d) Each request for disbursement shall be accompanied by a
certificate of Tenant describing the work, materials or other costs or expenses,
for which payment is requested, stating the cost incurred in connection
therewith and stating that Tenant has not previously received payment for such
work or expense and the certificate to be delivered by Tenant upon completion of
the work shall, in addition, state that the work has been substantially
completed and complies with the applicable requirements of this Lease.
(e) The Trustee may retain ten percent (10%) of the Restoration
Fund until the Restoration is at least fifty percent (50%) complete, and
thereafter five percent (5%) until the Restoration is substantially complete.
(f) The Restoration Fund shall be kept in a separate
interest-bearing federally insured account by the Trustee or by Lender. All
interest shall become a part of the Restoration Fund.
(g) At all times the undisbursed balance of the Restoration Fund
held by Trustee plus any funds contributed thereto by Tenant, at its option,
shall be not less than the cost of completing the Restoration, free and clear of
all liens.
(h) In addition, prior to commencement of Restoration and at any
time during Restoration, if the estimated cost of Restoration, as reasonably
determined by Landlord, exceeds the amount of the Net Proceeds, the Restoration
Award and Tenant Insurance Payment available for such Restoration, the amount of
such excess shall be paid by Tenant to the Trustee to be added to the
Restoration Fund or Tenant shall fund at its own expense the costs of such
Restoration until the remaining Restoration Fund is sufficient for the
completion of the Restoration. Any sum in the Restoration Fund which remains in
the Restoration Fund upon the
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completion of Restoration shall be paid to Tenant. For purposes of determining
the source of funds with respect to the disposition of funds remaining after the
completion of Restoration, the Net Proceeds or the Restoration Award shall be
deemed to be disbursed prior to any amount added by Tenant.
16. Subordination to Financing.
(a) (i) Subject to the provisions of Paragraph 16 (a)(ii),
Tenant agrees that this Lease shall at all times be subject and subordinate to
the lien of any Mortgage, and Tenant agrees, upon demand, without cost, to
execute instruments as may be required to further effectuate or confirm such
subordination.
(ii) Except as expressly provided in this Lease by reason of
the occurrence of an Event of Default, and as a condition to the subordination
described in Paragraph 16(a)(i) above, Tenant's tenancy and Tenant's rights
under this Lease shall not be disturbed, terminated or otherwise adversely
affected, nor shall this Lease be affected, by the existence of, or any default
under, any Mortgage, and in the event of a foreclosure or other enforcement of
any Mortgage, or sale in lieu thereof, the purchaser at such foreclosure sale
shall be bound to Tenant for the Term of this Lease and any Renewal Term, the
rights of Tenant under this Lease shall expressly survive, and this Lease shall
in all respects continue in full force and effect so long as no Event of Default
has occurred and is continuing. Tenant shall not be named as a party defendant
in any such foreclosure suit, except as may be required by law. Any Mortgage to
which this Lease is now or hereafter subordinate shall provide (and the
subordination provisions described in Section 16(a)(i) above are contingent upon
such Mortgage providing), in effect, that during the time this Lease is in force
and no Event of Default has occurred and is then continuing hereunder, insurance
proceeds and any condemnation award shall be disbursed pursuant to the
provisions of this Lease.
(b) Notwithstanding the provisions of Paragraph 16(a), the holder
of any Mortgage to which this Lease is subject and subordinate shall have the
right, at its sole option, at any time, to subordinate and subject the Mortgage,
in whole or in part, to this Lease by recording a unilateral declaration to such
effect, provided that such holder shall have agreed that during the time this
Lease is in force any insurance proceeds and any condemnation award shall be
disbursed pursuant to the provisions of this Lease and shall be permitted to be
used for restoration in accordance with the provisions of this Lease.
(c) At any time prior to the expiration of the Term, Tenant
agrees, at the election and upon demand of any owner of the Leased Premises, or
of a Lender who has granted non-disturbance to Tenant pursuant to Paragraph 16
(a) above, to attorn, from time to time, to any such owner or Lender, upon the
terms and conditions of this Lease, for the remainder of the Term. The
provisions of this Paragraph 16(c) shall inure to the benefit of any such owner
or Lender, shall apply notwithstanding that, as a matter of law, this Lease may
terminate upon the foreclosure of the Mortgage, shall be self-operative upon any
such demand, and no further instrument shall be required to give effect to said
provisions.
(d) Each of Tenant, any owner and Lender, however, upon demand of
the other, hereby agrees to execute, from time to time, instruments in
confirmation of the foregoing
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provisions of Paragraphs 16(a) and 16(c), reasonably satisfactory to the
requesting party acknowledging such subordination, non-disturbance and
attornment as are provided in such subsections and setting forth the terms and
conditions of its tenancy.
(e) Each of Tenant, Landlord and Lender agrees that, if requested
by any of the others, each shall, without charge, enter into a Subordination,
Non-Disturbance and Attornment Agreement reasonably requested by Lender,
provided such agreement contains provisions relating to non-disturbance in
accordance with the provisions of Paragraph 16(a) and Tenant hereby agrees for
the benefit of any Lender whose name and address have been provided to Tenant,
that Tenant will not, (i) without in each case the prior written consent of such
Lender, which shall not be unreasonably withheld, conditioned or delayed, amend
or modify this Lease (provided, however, such Lender, in such Lender's sole
discretion may withhold or condition its consent to any amendment or
modification which would or could (A) alter in any way the amount or time for
payment of any Basic Rent, Additional Rent or other sum payable hereunder, (B)
alter in any way the absolute and unconditional nature of Tenant's obligations
hereunder or materially diminish any such obligations, (C) result in any
termination hereof prior to the end of the initial term, or (D) otherwise, in
such Lender's reasonable judgment, affect the rights or obligations of Landlord
or Tenant hereunder), or enter into any agreement with Landlord so to do, (ii)
without the prior written consent of such Lender which may be withheld in such
Lender's sole discretion, cancel or surrender or seek to cancel or surrender the
Term hereof, or enter into any agreement with Landlord to do so (the parties
agreeing that the foregoing shall not be construed to affect the rights or
obligations of Tenant, Landlord or Lender with respect to any termination
permitted under the express terms hereof following certain events of
condemnation or casualty as provided in Paragraph 13 or Paragraph 14 hereof), or
(c) pay any installment of Basic Rent more than one (1) month in advance of the
due date thereof or otherwise than in the manner provided for in this Lease.
17. Assignment, Subleasing.
(a) With the exception of a tenant that would render the Leased
Premises or a portion thereof a "tax-exempt use property" within the meaning of
Section 168(h) of the Code, Tenant may assign its interest in this Lease and may
sublet the Leased Premises in whole or in part, from time to time, without the
consent of Landlord. Except for any right to place a lien on its personal
property and Trade Fixtures, Tenant shall have no rights to mortgage or
otherwise hypothecate its leasehold interest under this Lease. With respect to
any assignment or sublease to an entity that is not an Affiliate, Tenant shall
provide Landlord with a written summary of the material terms of such assignment
or sublease prior to the commencement date thereof.
(b) Each sublease of the Leased Premises or any part thereof shall
be subject and subordinate to the provisions of this Lease. No assignment or
sublease shall affect or reduce any of the obligations of Tenant hereunder, and
all such obligations shall continue in full force and effect as obligations of a
principal and not as obligations of a guarantor, as if no assignment or sublease
had been made. Notwithstanding any assignment or subletting (i) Tenant shall
continue to remain primarily liable and responsible for the payment of the Basic
Rent and Additional Rent and the performance of all its other obligations under
this Lease and (ii) Lease Guarantor shall continue to remain primarily liable
for each of its payment and performance obligations under the Lease Guaranty. No
assignment or sublease shall impose any obligations
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on Landlord under this Lease except as otherwise provided in this Lease. Tenant
agrees that in the case of an assignment of this Lease, Tenant shall, within
fifteen (15) days after the execution and delivery of any such assignment,
deliver to Landlord (i) a duplicate original of such assignment in recordable
form and (ii) an agreement executed and acknowledged by the assignee in
recordable form wherein the assignee shall agree to assume and agree to observe
and perform all of the terms and provisions of this Lease on the part of the
Tenant to be observed and performed from and after the date of such assignment.
In the case of a sublease, Tenant shall, within fifteen (15) days after the
execution and delivery of such sublease, deliver to Landlord a duplicate
original of such sublease.
(c) Upon the occurrence of an Event of Default under this Lease,
Landlord shall have the right to collect and enjoy all rents and other sums of
money payable under any sublease of any of the Leased Premises, and Tenant
hereby irrevocably and unconditionally assigns such rents and money to Landlord,
which assignment may be exercised upon and after (but not before) the occurrence
of an Event of Default.
18. Permitted Contests.
(a) So long as no Event of Default has occurred and is continuing,
after prior written notice to Landlord, Tenant shall not be required to (i) pay
any Imposition, (ii) comply with any Legal Requirement, (iii) discharge or
remove any lien referred to in Paragraph 9 or 12, or (iv) take any action with
respect to any violation referred to in Paragraph 11(b) so long as Tenant shall
contest, in good faith and at its expense, the existence, the amount or the
validity thereof, the amount of the damages caused thereby, or the extent of its
or Landlord's liability therefor, by appropriate proceedings which shall operate
during the pendency thereof to prevent (A) the collection of, or other
realization upon, the Imposition or lien so contested, (B) the sale, forfeiture
or loss of any of the Leased Premises, any Basic Rent or any Additional Rent to
satisfy the same or to pay any damages caused by the violation of any such Legal
Requirement or by any such violation, (C) any interference with the use or
occupancy of any of the Leased Premises, (D) any interference with the payment
of any Basic Rent or any Additional Rent, and (E) the cancellation of any fire
or other insurance policy.
(b) In no event shall Tenant pursue any contest with respect to
any Imposition, Legal Requirement, lien, or violation, referred to above in such
manner that exposes Landlord or Lender to (i) criminal liability, penalty or
sanction, (ii) any civil liability, penalty or sanction for which Tenant has not
made provisions reasonably acceptable to Landlord and Lender or (iii) defeasance
of its interest (including the subordination of the lien of any Mortgage to a
lien to which such Mortgage is not otherwise subordinate prior to such contest)
in the Leased Premises.
(c) Tenant agrees that each such contest shall be promptly and
diligently prosecuted to a final conclusion, except that Tenant shall have the
right to attempt to settle or compromise such contest through negotiations.
Tenant shall pay and save Lender and Landlord harmless against any and all
losses, judgments, decrees and costs (including all attorneys' fees and
expenses) in connection with any such contest and shall, promptly after the
final determination of such contest, fully pay and discharge the amounts which
shall be levied, assessed, charged or imposed or be determined to be payable
therein or in connection therewith,
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together with all penalties, fines, interest, costs and expenses thereof or in
connection therewith, and perform all acts the performance of which shall be
ordered or decreed as a result thereof.
19. Conditional Limitations; Default Provisions.
(a) If any Event of Default shall have occurred, Landlord shall
have the right at its option, then or at any time thereafter, to do any one or
more of the following without demand upon or notice to Tenant:
(i) Landlord may give Tenant notice of Landlord's intention
to terminate this Lease on a date specified in such notice (which date shall be
no sooner than ten (10) days after the date of the notice). Upon the date
therein specified the Term and the estate hereby granted and all rights of
Tenant hereunder shall expire and terminate as if such date were the date
hereinabove fixed for the expiration of the Term, but Tenant shall remain liable
for all its obligations hereunder through the date hereinabove fixed for the
expiration of the Term, including its liability for Basic Rent and Additional
Rent as hereinafter provided.
(ii) Landlord may, whether or not the Term of this Lease
shall have been terminated pursuant to clause (i) above give Tenant notice to
surrender the Leased Premises to Landlord on a date specified in such notice
(which date shall be no sooner than ten (10) days after the date of the notice),
at which time Tenant shall surrender and deliver possession of the Leased
Premises to Landlord. Upon or at any time after taking possession of the Leased
Premises, Landlord may remove any persons or property therefrom. Landlord shall
be under no liability for or by reason of any such entry, repossession or
removal. No such entry or repossession shall be construed as an election by
Landlord to terminate this Lease unless Landlord gives a written notice of such
intention to Tenant pursuant to clause (i) above.
(iii) After repossession of any of the Leased Premises
pursuant to clause (ii) above, whether or not this Lease shall have been
terminated pursuant to clause (i) above, Landlord may relet the Leased Premises
or any part thereof to such tenant or tenants for such term or terms (which may
be greater or less than the period which would otherwise have constituted the
balance of the Term) for such rent, on such conditions (which may include
concessions or free rent) and for such uses as Landlord, in its reasonable
discretion, may determine; and Landlord shall collect and receive any rents
payable by reason of such reletting. The rents received on such reletting shall
be applied (A) first to the reasonable and actual expenses of such reletting and
collection, including without limitation necessary renovation and alterations of
the Leased Premises, reasonable and actual attorneys' fees and any reasonable
and actual real estate commissions paid, and (B) thereafter toward payment of
all sums due or to become due Landlord hereunder. If a sufficient amount to pay
such expenses and sums shall not be realized or secured, then Tenant shall pay
Landlord any such deficiency monthly, and Landlord may bring an action therefor
as such monthly deficiency shall arise. Landlord shall not, in any event, be
required to pay Tenant any sums received by Landlord on a reletting of the
Leased Premises in excess of the rent provided in this Lease, but such excess
shall reduce any accrued present or future obligations of Tenant hereunder.
Landlord's re-entry and reletting of the Leased Premises without termination of
this Lease shall not preclude Landlord from subsequently terminating this Lease
as set forth above. Landlord may make such Alterations as Landlord in its
reasonable discretion may deem advisable. Tenant agrees to pay Landlord, as
-24-
Additional Rent, immediately upon demand, all reasonable expenses incurred by
Landlord in obtaining possession, in performing Alterations and in reletting any
of the Leased Premises, including fees and commissions of attorneys, architects,
agents and brokers.
(iv) If Tenant shall fail to make payment of any installment
of Basic Rent or any Additional Rent after the date when each such payment is
due, Tenant shall pay to Landlord, as Additional Rent, interest on the unpaid
amount of Basic Rent or Additional Rent, at the Default Rate, such interest to
accrue from the date such item of unpaid Basic Rent or Additional Rent was due
until the date paid.
(v) Landlord may exercise any other right or remedy now or
hereafter existing by law or in equity.
(b) In the event of any expiration or termination of this Lease or
repossession of any of the Leased Premises by reason of the occurrence of an
Event of Default, Tenant shall pay to Landlord Basic Rent, Additional Rent and
all other sums required to be paid by Tenant to and including the date of such
expiration, termination or repossession and, thereafter, Tenant shall, until the
end of what would have been the Term in the absence of such expiration,
termination or repossession (excluding any Renewal Term that has not then
commenced), and whether or not any of the Leased Premises shall have been relet,
be liable to Landlord for and shall pay to Landlord as liquidated and agreed
current damages: (i) Basic Rent, Additional Rent and all other sums which would
be payable under this Lease by Tenant in the absence of such expiration,
termination or repossession, less (ii) the net proceeds, if any, of any
reletting pursuant to Paragraph 19 (a)(iii), after deducting from such proceeds
all of Landlord's reasonable expenses in connection with such reletting
(including all reasonable repossession costs, brokerage commissions, legal
expenses, attorneys' fees, employees' expenses, costs of Alteration and expenses
of preparation for reletting). Tenant hereby agrees to be and remain liable for
all sums aforesaid and Landlord may recover such damages from Tenant and
institute and maintain successive actions or legal proceedings against Tenant
for the recovery of such damages. Nothing herein contained shall be deemed to
require Landlord to wait to begin such action or other legal proceedings until
the date when the Term would have expired by limitation had there been no such
Event of Default.
(c) At any time after such expiration or sooner termination of
this Lease pursuant to Paragraph 19 or pursuant to law or if Landlord shall have
reentered the Leased Premises, as the case may be, whether or not Landlord shall
have recovered any amounts under Paragraph 19(a)(iii) or 19(b), Landlord shall
be entitled to recover from Tenant and Tenant shall pay to Landlord, on demand,
as and for liquidated and agreed final damages for Tenant's default, the amount
by which the Basic Rent and all Additional Rent reserved hereunder for the
unexpired portion of the Term demised herein as if this Lease had not expired or
been terminated (excluding any Renewal Term that has not then commenced) exceeds
the then fair and reasonable rental value of the Leased Premises for the same
period, discounted to present worth at the annual rate of six percent (6%),
minus any such monthly deficiencies previously recovered from Tenant under
Paragraph 19(a)(iii). If any statute or rule of law governing a proceeding in
which such liquidated final damages provided for in this Paragraph 19(c) are to
be proved shall validly limit the amount thereof to an amount less than the
amount above agreed upon, Landlord shall be entitled to the maximum amount
allowable under such statute or rule of law.
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20. Additional Rights of Landlord and Tenant.
(a) No right or remedy conferred upon or reserved to Landlord in
this Lease is intended to be exclusive of any other right or remedy; and each
and every right and remedy shall be cumulative and in addition to any other
right or remedy contained in this Lease. No delay or failure by Landlord or
Tenant to enforce its rights under this Lease shall be construed as a waiver,
modification or relinquishment thereof. In addition to the other remedies
provided in this Lease, Landlord and Tenant shall be entitled, to the extent
permitted by applicable law, to injunctive relief in case of the violation or
attempted or threatened violation of any of the provisions of this Lease, or to
specific performance of any of the provisions of this Lease.
(b) Tenant hereby waives and surrenders for itself and all those
claiming under it, including creditors of all kinds, any right and privilege
which it or any of them may have under any present or future law to redeem any
of the Leased Premises or to have a continuance of this Lease after termination
of this Lease or of Tenant's right of occupancy or possession pursuant to any
court order or any provision hereof.
(c) Landlord hereby waives any right to distrain or levy upon
Trade Fixtures or any property of Tenant and any Landlord's lien or similar lien
upon Trade Fixtures and any other property of Tenant regardless of whether such
lien is created or otherwise. Landlord agrees at the request of Tenant, to
execute a waiver of any Landlord's or similar lien for the benefit of any
present or future holder of a security interest in or landlord of any of Trade
Fixtures or any other personal property of Tenant.
(d) Landlord acknowledges and agrees in the future to acknowledge
(in a written form reasonably satisfactory to Tenant) to such persons and
entities at such times and for such purposes as Tenant may reasonably request
that the Trade Fixtures are Tenant's property and not part of the Improvements
(regardless of whether or to what extent such Trade Fixtures are affixed to the
Improvements) or otherwise subject to the terms of this Lease.
(e) (i) Tenant agrees to pay to Landlord any and all reasonable
costs and expenses incurred by Landlord in connection with any litigation or
other action instituted by Landlord to enforce the obligations of Tenant under
this Lease, to the extent that Landlord has prevailed in any such litigation or
other action. Any amount payable by Tenant to Landlord pursuant to this
Paragraph 20(e)(i) shall be due and payable by Tenant to Landlord as Additional
Rent.
(ii) Landlord agrees to pay to Tenant any and all reasonable
costs and expenses incurred by Tenant in connection with any litigation or other
action instituted by Tenant to enforce the obligations of Landlord under this
Lease, to the extent that Tenant has prevailed in any such litigation or other
action. Any amount payable by Landlord to Tenant pursuant to this Paragraph
20(e)(ii) shall be due and payable within thirty (30) days after a final,
non-appealable judgment or decision is rendered in favor of Tenant in such
litigation or other action.
21. Notices. All Notices shall be in writing and shall be deemed to have
been given for all purposes (i) three (3) days after having been sent by United
States mail, by registered or
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certified mail, return receipt requested, postage prepaid, addressed to the
other party at its address as stated below, or (ii) one (1) day after having
been sent for overnight delivery by Federal Express, United Parcel Service or
other nationally recognized air courier service:
If to Landlord:
x/x Xxxxxxxx Xxxxxxxxxxx Xxxxxxxxxxx
One Wachovia Center
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Xxxxxxxxx Xxxxxxxxx
with a copy to:
Wolf, Block, Xxxxxx and Xxxxx-Xxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxx, Esq.
If to Tenant:
Quality Foods, Inc.
c/o Performance Food Group Company
00000 Xxxx Xxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxx
with a copy to:
Xxxx Xxxxx & Xxxx PLC
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: D. Xxxx Xxxxxx
If any Lender shall have advised Tenant by Notice in the manner aforesaid that
it is the holder of a Mortgage and states in said Notice its address for the
receipt of Notices, then simultaneously with the giving of any Notice by Tenant
to Landlord, Tenant shall send a copy of such Notice to Lender in the manner
aforesaid. For the purposes of this Paragraph 21, any party may substitute its
address by giving fifteen days' notice to the other party in the manner provided
above. Any Notice may be given on behalf of any party by its counsel.
22. Estoppel Certificates. Landlord and Tenant shall at any time and
from time to time, upon not less than twenty (20) days' prior written request by
the other, execute, acknowledge and deliver to the other a statement in writing,
certifying (i) that this Lease is unmodified and in full effect (or, if there
have been modifications, that this Lease is in full effect as modified, setting
forth such modifications), (ii) the dates to which Basic Rent payable hereunder
has been paid, (iii) that to the knowledge of the signer of such certificate no
default by either Landlord or Tenant exists hereunder or specifying each such
default of which the signer
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may have knowledge, (iv) the remaining Term hereof, (v) with respect to a
certificate signed on behalf of Tenant, that to the knowledge of the signer of
such certificate, there are no proceedings pending or threatened against Tenant
before or by any court or administrative agency which if adversely decided would
materially and adversely affect the financial condition and operations of Tenant
or if any such proceedings are pending or threatened to said signer's knowledge,
specifying and describing the same, and (vi) such other matters as may
reasonably be requested by the party requesting the certificate. It is intended
that any such statements may be relied upon by Lender, the recipient of such
statements or their assignees or by any prospective purchaser, assignee or
subtenant of the Leased Premises.
23. Surrender and Holding Over.
(a) Upon the expiration or earlier termination of this Lease,
Tenant shall peaceably leave and surrender the Leased Premises (except as to any
portion thereof with respect to which this Lease has previously terminated) to
Landlord. Tenant shall remove from the Leased Premises on or prior to such
expiration or earlier termination the Trade Fixtures and personal property which
is owned by Tenant or third parties other than Landlord, and Tenant at its
expense shall, on or prior to such expiration or earlier termination, repair any
damage caused by such removal. Trade Fixtures and personal property not so
removed at the end of the Term or within thirty days after the earlier
termination of the Term for any reason whatsoever shall become the property of
Landlord, and Landlord may thereafter cause such property to be removed from the
Leased Premises. The cost of removing and disposing of such property and
repairing any damage to any of the Leased Premises caused by such removal shall
be borne by Tenant. Landlord shall not in any manner or to any extent be
obligated to reimburse Tenant for any property which becomes the property of
Landlord as a result of such expiration or earlier termination.
(b) Any holding over by Tenant of the Leased Premises after the
expiration or earlier termination of the term of this Lease or any extensions
thereof, with the consent of Landlord, shall operate and be construed as tenancy
from month to month only, at one hundred twenty-five percent (125%) of the Basic
Rent reserved herein and upon the same terms and conditions as contained in this
Lease. Notwithstanding the foregoing, any holding over without Landlord's
consent shall entitle Landlord, in addition to collecting Basic Rent at a rate
of twenty-five percent (125%) thereof, to exercise all rights and remedies
provided by law or in equity, including the remedies of Paragraph 19(b).
24. No Merger of Title. There shall be no merger of this Lease nor of
the leasehold estate created by this Lease with the fee estate in or ownership
of any of the Leased Premises by reason of the fact that the same person,
corporation, firm or other entity may acquire or hold or own, directly or
indirectly, (a) this Lease or the leasehold estate created by this Lease or any
interest in this Lease or in such leasehold estate and (b) the fee estate or
ownership of any of the Leased Premises or any interest in such fee estate or
ownership. No such merger shall occur unless and until all persons,
corporations, firms and other entities having any interest in (i) this Lease or
the leasehold estate created by this Lease and (ii) the fee estate in or
ownership of the Leased Premises or any part thereof sought to be merged shall
join in a written instrument effecting such merger and shall duly record the
same.
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25. Definition of Landlord.
(a) Anything contained herein to the contrary notwithstanding, any
claim based on or in respect of any liability of Landlord under this Lease shall
be enforced only against the Landlord's interest in the Leased Premises and
shall not be enforced against the Landlord individually or personally.
(b) The term "Landlord" as used in this Lease so far as covenants
or obligations on the part of Landlord are concerned, shall be limited to mean
and include only the owner or owners of the Leased Premises or holder of the
Mortgage in possession at the time in question of the Leased Premises and in the
event of any transfer or transfers of the title of the Leased Premises, the
Landlord herein named (and in case of any subsequent transfers or conveyances,
the then grantor) shall be automatically freed and relieved from and after the
date of such transfer and conveyance of all personal liability as respects the
performance of any covenants or obligations on the part of Landlord contained in
this Lease thereafter to be performed.
26. Hazardous Substances.
(a) Tenant agrees that it will not on, about, or under the Leased
Premises, make, release, treat or dispose of any "hazardous substances" as that
term is defined in CERCLA; but the foregoing shall not prevent the use, storage
or existence of any hazardous substances in accordance with applicable laws and
regulations and at levels that do not impose any clean up liability or
obligation. Tenant represents and warrants that it will at all times comply with
CERCLA and any other Environmental Laws.
(b) To the extent required by CERCLA and/or any other
Environmental Laws, Tenant shall remove any "hazardous substances" (as defined
in CERCLA) and "Hazardous Materials" (as defined above) whether now or hereafter
existing on the Leased Premises and whether or not arising out of or in any
manner connected with Tenant's occupancy of the Leased Premises during the Term.
In addition to, and without limiting Paragraph 10 of this Lease, Tenant shall
and hereby does agree to defend, indemnify and hold Lender and Landlord, their
respective successors and assigns, officers, directors, shareholders, partners,
members, affiliates, beneficiaries and employees, harmless from and against any
and all causes of actions, suits, demands or judgments of any nature whatsoever,
losses, damages, penalties, expenses, fees, claims, costs (including response
and remedial costs), and liabilities, including, but not limited to, reasonable
attorneys' fees and costs of litigation, arising out of or in any manner
connected with (i) the violation of any Environmental Law with respect to the
Leased Premises or Tenant's prior ownership of the Leased Premises; or (ii) the
"release" or "threatened release" of or failure to remove, as required by this
Paragraph 26, "hazardous substances" (as defined in CERCLA) and Hazardous
Materials (as defined above) from the Leased Premises or any portion or portions
thereof, including any past or current release and any release or threatened
release during the initial term or any extension of Renewal Term, whether or not
arising out of or in any manner connected with Tenant's occupancy of the Leased
Premises during the Initial Term or any extension or Renewal Term.
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(c) Tenant agrees that it will not install any underground storage
tank at the Leased Premises without specific, prior written approval from the
Landlord; provided, however, that Tenant may replace the two existing storage
tanks identified in that certain Draft Phase I Environmental Site Assessment
Report, Quality-PFG Little Rock, Little Rock, AR, prepared by EnSafe, Inc. and
dated March 16, 2004, as long as (i) Tenant provides Landlord and Lender with
not less than twenty (20) days' prior written notice of such replacement work,
and (ii) such replacement work is performed and completed by or on behalf of
Tenant in accordance with all applicable Environmental Laws. The Tenant agrees
that it will not store combustible or flammable materials on the Leased Premises
in violation of CERCLA or any other Environmental Laws.
27. Entry by Landlord. Landlord and its authorized representatives shall
have the right upon reasonable notice (which shall be not less than two (2)
business days except in the case of emergency) to enter the Leased Premises at
all reasonable business hours (and at all other times in the event of an
emergency): (a) for the purpose of inspecting the same or for the purpose of
doing any work under Paragraph 11(c), and may take all such action thereon as
may be necessary or appropriate for any such purpose (but nothing contained in
this Lease or otherwise shall create or imply any duty upon the part of Landlord
to make any such inspection or do any such work), and (b) for the purpose of
showing the Leased Premises to prospective purchasers and mortgagees and, at any
time within six (6) months prior to the expiration of the Term of this Lease for
the purpose of showing the same to prospective tenants. No such entry shall
constitute an eviction of Tenant but any such entry shall be done by Landlord in
such reasonable manner as to minimize any disruption of Tenant's business
operation.
28. No Usury. The intention of the parties being to conform strictly to
the applicable usury laws, whenever any provision herein provides for payment by
Tenant to Landlord of interest at a rate in excess of the legal rate permitted
to be charged, such rate herein provided to be paid shall be deemed reduced to
such legal rate.
29. Financial Statements. Tenant shall submit to Landlord and Lender,
either in print or in electronic form, the following financial statements, all
of which must be prepared in accordance with generally accepted accounting
principles consistently applied: (i) quarterly financial statements for Lease
Guarantor within forty-five (45) days after the end of each March, June,
September and December during the Term and any Renewal Term, and (ii) annual
financial statements for Lease Guarantor, audited by an independent certified
public accountant, within ninety (90) days after the end of each fiscal year
during the Term and any Renewal Term. Notwithstanding the foregoing, for so long
as Lease Guarantor shall be a publicly listed company and is required to file
quarterly and annual statements with the SEC, then Tenant shall submit to
Landlord and Lender (in satisfaction of the requirements set forth in the
preceding sentence), when filed with the SEC, copies of Lease Guarantor's forms
10Q and 10K. Notwithstanding the foregoing, Tenant shall not be required to
submit any such forms or financial statements if on or before the applicable
delivery date, such financial statements are available on XXXXX.
30. Special Tax Indemnity.
(a) Tenant hereby represents, warrants and covenants to Landlord
as follows: (i) under current law, neither the Leased Premises as a whole nor
the Equipment constitutes
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"limited use Leased Premises" within the meaning of Revenue Procedure 76-30,
1976-2 C.B. 647; (ii) at no time during the Term will the Leased Premises or any
portion thereof constitute "tax-exempt use property" within the meaning of
Section 168(h) of the Code; (iii) neither Tenant nor any Affiliate will claim
any depreciation or cost recovery deductions with respect to the Leased Premises
or any portion thereof, and has taken or will take any other action in
connection with filing its or their federal income tax returns that would be a
primary factor resulting in a Loss or Inclusion (in each case, as defined in
Paragraph 30(b) below); (iv) as of the date hereof with respect to the (I)
Improvements and Fixtures and (II) the Equipment, such Leased Premises will not
require any improvement, modification or addition in order to be rendered
complete for its intended use by Tenant; and (v) all written information
supplied, caused to be supplied or to be supplied to any appraiser by or on
behalf of Tenant or any Affiliate of Tenant with respect to the Leased Premises
or any portion thereof was or will be, as the case may be, true and accurate
when supplied.
(b) If, by reason of any act or omission of Tenant or by any other
Person in possession of the Leased Premises or any portion thereof or by reason
of the inaccuracy or breach by Tenant of any of the representations, warranties
and covenants contained in this Paragraph 30, any anticipated depreciation
deductions are lost, disallowed, eliminated, reduced, recaptured, compromised,
delayed or otherwise made unavailable to Landlord (a "Loss") or Landlord incurs
a tax detriment because Landlord is required to include amounts in income other
than Anticipated Lease Income (an "Inclusion"), Tenant shall, upon notice from
Landlord promptly pay such Person on demand in immediately available funds, as
an indemnity an amount which, on an After-Tax Basis, shall be equal to the sum
of (x) the increase in federal, state, local and foreign income tax liability
for the respective taxable year attributable to such Loss or Inclusion plus (y)
the amounts of interest, penalties and additions to tax (including, without
limitation, any additions to tax because of underpayment of estimated tax),
which are assessed against Landlord for such taxable year by the Internal
Revenue Service or any relevant state, local or foreign taxing authority and
which are attributable to such Loss or Inclusion.
(c) Landlord shall notify Tenant in writing of any actual or
proposed claim, adjustment or other action of any tax authority received by
Landlord in writing with respect to which Tenant may be required to provide
indemnification under this Paragraph 30 ("Proposed Adjustment") (but failure of
Landlord to so notify Tenant shall not relieve Tenant of its obligations
hereunder except to the extent that Tenant is precluded from any contest and
actually and materially harmed thereby). If Tenant shall request in writing
within thirty (30) days after Landlord's notice described above that the
Proposed Adjustment be contested (or such shorter period in which the Landlord
may be required to take action), Landlord shall contest the Proposed Adjustment;
provided, however, that: (i) prior to taking such action, Tenant shall have
furnished Landlord with an opinion of independent tax advisor chosen by Tenant
and reasonably acceptable to Landlord, to the effect that Landlord has a
reasonable possibility of success in contesting the claim; (ii) prior to taking
such action, Tenant shall have (A) acknowledged its obligation to indemnify
Landlord hereunder in the event Landlord does not prevail in such contest and
(B) agreed to reimburse Landlord promptly on demand for, (or, if so requested by
Landlord, advance) all costs and expenses that Landlord may incur in connection
with contesting such claim, including without limitation reasonable attorneys'
and accountants' fees and expenses; (iii) no Event of Default shall exist and be
continuing; (iv) Landlord shall not be obligated to contest any proposed amount
that is less than $25,000.00; and (v) Landlord shall in
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all events control the contest, and Tenant shall not have any right to inspect
the books and records of Landlord, but shall have reasonable opportunity to
review and comment on portions of documentation, protests, memoranda or briefs
relating exclusively to a Proposed Adjustment. In the event Landlord pays the
tax claimed and then seeks a refund, Landlord may require Tenant to advance
funds sufficient to pay the tax that would be indemnified by Tenant hereunder if
the refund claim were resolved adversely to Landlord. To the extent the refund
claim is successful, the refund received from the taxing authority and
attributable to funds advanced by Tenant shall be refunded to Tenant, unless the
refund is needed to pay an indemnity. Notwithstanding anything to the contrary
in this Paragraph 30(c), Landlord may at any time decline to take any further
action with respect to a Proposed Adjustment or may settle any contest without
the consent of Tenant; provided, however, that if Tenant has complied with all
the terms of this Paragraph 30(c), and Tenant has reasonably withheld in writing
its consent to all or part of such assessment or settlement based upon its
evaluation of the merits, Tenant will not be obligated to indemnify Landlord for
the portion of such assessment or settlement to which Tenant has reasonably
withheld its consent. In the case of any flow-through entity, "Landlord" shall
include the member or other equity owners of Landlord required to report the
gross or net income of Landlord and/or other items of income, expense, deduction
and credit with respect thereto, and "Landlord" and the owners thereof shall
include the consolidated group of which any such Person is a part for income tax
purposes.
(d) Notwithstanding anything herein to the contrary, the
provisions of this Paragraph 30 shall survive the earlier termination of this
Lease.
31. Withholdings.
(a) Notwithstanding anything herein to the contrary, Tenant agrees
that each payment of Basic Rent and Additional Rent shall be free and clear of,
and without deduction for any withholdings of any nature whatsoever unless
required by Applicable Law. If any deduction or withholding is required with
respect to a payment of Basic Rent and/or Additional Rent by Tenant, Tenant
shall pay an additional amount such that the net amount actually received by the
Tax Indemnitee, after deduction or withholding, will be equal, on an After-Tax
Basis, to all such amounts that would be received by the Tax Indemnitee if no
such deduction or withholding had been required; provided, that the Tenant shall
not be obligated to pay any additional amount pursuant to this Paragraph 31 if
the requirement to make such payment is solely due to the failure of a Tax
Indemnitee to comply with Paragraph 8(a)(ii)(E) to obtain relief or exemption
from such withholding.
(b) Notwithstanding anything herein to the contrary, the
provisions of this Paragraph 31 shall survive the earlier termination of this
Lease.
32. Substitution of Leased Premises. Tenant may elect to effect a
Substitution; provided, that, the terms and conditions of this Paragraph 32 are
fully satisfied:
(a) Tenant or Lease Guarantor shall provide Landlord with evidence
satisfactory to Landlord that the Substitute Premises are of a specific use,
strategic and necessary to the continued operations of Lease Guarantor or one of
its Subsidiaries and that such Substitute Premises shall be used and occupied by
Lease Guarantor or one of its Subsidiaries;
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(b) the appraised fair market value and the useful life of the
Substitute Premises shall be at least equal to the appraised fair market value
and the useful life of the Withdrawn Premises at the time of the Substitution,
as evidenced by an MAI appraisal prepared by an independent appraiser acceptable
to the Rating Agencies (if the Loan is part of a Secondary Market Transaction)
and dated no more than forty-five (45) days prior to the Substitution;
(c) Intentionally deleted;
(d) Intentionally deleted;
(e) no Event of Default by Tenant shall have occurred and be
continuing under this Lease either at the time of the request for the proposed
Substitution or on the date of the Substitution;
(f) Tenant shall provide Landlord with written notice of the
prospective Substitution not less than sixty (60) days before the date on which
such Substitution is sought to be effected;
(g) the Substitute Premises must be a property as to which
Landlord will hold fee title and Lender (if any) will hold a first mortgage on
Landlord's fee simple estate;
(h) Landlord and Tenant shall either (i) enter into a Substitution
Lease and Tenant's obligation to pay rent under the Substitution Lease shall
commence not later than the date of the Substitution, or (ii) amend this Lease
to include the Substitute Premises as the Leased Premises.
(i) Tenant shall be required to accept the Substitute Premises in
their "as is" condition;
(j) Lease Guarantor shall execute and deliver to Landlord an
unconditional guaranty of payment and performance with respect to the
Substitution Lease on the same terms and conditions as the existing Lease
Guaranty, or shall amend the existing Lease Guaranty to expressly confirm and
ratify the applicability of such Lease Guaranty in respect of the amended Lease
described in Paragraph 32(h);
(k) Tenant shall satisfy the requirements of Lender, including,
without limitation, with respect to the delivery of an opinion or opinions of
counsel from a reputable law firm acceptable to Lender and the Rating Agencies
in form and substance satisfactory to the Rating Agencies (1) to the effect that
(a) the Substitution does not violate any, and is in compliance with all, REMIC
Provisions, will not endanger the status of the REMIC Trust as a REMIC, or
result in the imposition of a tax upon the REMIC Trust (including, but not
limited to, the tax on prohibited transactions as defined in Section 860F(a)(2)
of the Code and the tax on contributions to a REMIC set forth in Section 860G(d)
of the Code), and (b) the Substitution does not constitute a fraudulent
conveyance under applicable bankruptcy and insolvency laws, and (2) with respect
to such other matters as Lender may require;
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(l) Tenant shall cause to be delivered to Landlord an opinion
letter from a reputable law firm, in form and content satisfactory to Landlord,
to the effect that the proposed Substitution (a) satisfies the requirements for
a "like-kind exchange" under Section 1031 of the Code, and (b) does not cause
Landlord to violate its holding requirements with respect to term of ownership
under Section 1031 of the Code;
(m) Tenant shall cause to be delivered to Landlord an opinion
letter from a reputable recognized law firm reasonably acceptable to Lender, in
form and content satisfactory to Landlord, relating to the (1) due
authorization, execution and delivery of the deed referenced in Paragraph
32(s)(ii) and the Substitute Lease or Lease amendment, as applicable, referenced
in Paragraph 32(h), and (2) the enforceability of the Substitute Lease or Lease
amendment, as applicable, referenced in Paragraph 32(h);
(n) Tenant shall be responsible for, and shall indemnify Landlord
and Lender (if any) against, any adverse tax consequence to Landlord or Lender,
if any, as the case may be, (on an After-Tax Basis as to each of Landlord and
Lender (if any)) to the extent resulting from such Substitution including,
without limitation, the payment of all Taxes which may be imposed in connection
with the Substitution of the Substitute Premises, the withdrawal of the
Withdrawn Premises or the sale at any time during the term of this Lease by
Landlord of the Substitute Premises or the Withdrawn Premises, as the case may
be;
(o) if Lender's loan is part of a Secondary Market Transaction, if
Lender elects, Lender shall have received evidence in writing from the Rating
Agencies to the effect that the proposed Substitution will not result in a
modification, reduction or withdrawal of any rating initially assigned or to be
assigned in such Secondary Market Transaction;
(p) the person or entity transferring the Substitute Premises to
Landlord shall be solvent, and the Substitute Premises shall be transferred to
Landlord in an arm's length transaction;
(q) Landlord's right, title and interest in the Withdrawn Premises
shall be transferred to another person or entity other than an affiliate of
Landlord;
(r) Tenant shall have (1) paid all costs and expenses, if any, of
the Rating Agencies incurred in connection with the Substitution, and (2) paid
or reimbursed Landlord and Lender for, concurrently with the effecting of such
Substitution, all reasonable out-of-pocket costs and expenses including, without
limitation, reasonable attorneys' fees, incurred by Landlord and Lender in
connection with the Substitution, and Tenant shall have paid all recording
charges, filing fees, taxes (excluding income, capital gains or similar taxes)
and other expenses (including, without limitation, mortgage, intangible and
transfer taxes) payable in connection with the Substitution;
(s) Tenant shall cause to be delivered to Landlord and Lender,
without any cost or expense to either such party:
(i) an ALTA title insurance policy (a lender's policy and an
owner's policy), with any and all endorsements Landlord and/or Lender may
require, insuring (a) Lender and its successors and assigns, in an amount equal
to the Loan amount for the Withdrawn
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Premises, which policy shall provide that the mortgage constitutes a first lien
or charge upon the Substitute Premises subject only to such items that are
comparable to those permitted with respect to the Withdrawn Premises and other
items as shall have been approved in writing by Lender, and (b) Landlord, in the
amount equal to the appraised value of the Substitute Premises, insuring
Landlord's fee interest in the Substitute Premises subject only to such items
that are comparable to those permitted with respect to the Withdrawn Premises
and other items as shall have been approved in writing by Landlord;
(ii) a deed conveying fee title to the Substitute Premises
executed and delivered in favor of Landlord and in substance (with respect to
warranties) substantially similar to the deed delivered to Landlord with respect
to the Withdrawn Premises;
(iii) a "Phase I" environmental assessment report and, if
applicable, a Phase II environmental assessment report, from a reputable
environmental consultant approved (if the Loan is part of a Secondary Market
Transaction) by the Rating Agencies, dated not more than forty-five (45) days
prior to the date of the proposed Substitution, which shall conclude that the
Substitute Premises does not contain any Hazardous Materials (except for such
items that are used in the ordinary course of the Tenant's business, in de
minimis amounts and in full compliance with all applicable laws and regulations
and at levels which do not impose any clean-up liability or obligations) and
certified to each of Landlord and Lender and its successors and assigns;
(iv) a copy of an as-built survey of the Substitute Premises
certified to Lender, Landlord and the issuer of the title policy by a registered
land surveyor licensed in the state in which the Substitute Premises is located
and acceptable to the Rating Agencies (if the Loan is part of a Secondary Market
Transaction), dated a date not earlier than thirty (30) days prior to the date
of Substitution, in the same form and having the same content as the
certification of the survey for the Withdrawn Premises, prepared in accordance
with the 1999 Minimum Standard Detail Requirements for ALTA/ACSM Land Title
Surveys. Such survey shall reflect the same legal description (metes and bounds)
as the one contained in the title policy, and shall contain a certification that
the Substitute Premises is not located in a flood zone;
(v) a zoning opinion or letter from the local zoning
authority or its representative confirming that the Substitute Premises is a
legal conforming, or legal nonconforming, use;
(vi) a permanent certificate of occupancy for the Substitute
Premises;
(vii) valid certificates of insurance indicating that the
requirements for the policies of insurance required under this Lease and the
Loan documents have been satisfied with respect to the Substitute Premises,
together with evidence of payment of all premiums for the existing policy
period;
(viii) an engineering report from a nationally recognized
engineering consultant approved by the Rating Agencies (if the Loan is part of a
Secondary Market Transaction) in a form recognized and approved by the Rating
Agencies (if the Loan is part of a Secondary Market Transaction), dated not more
than forty-five (45) days prior to the date of the
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proposed Substitution, stating that the Substitute Premises and its use comply
in all material respects with all applicable requirements of law (including
building and subdivision laws), and that the Substitute Premises is in good
condition and repair and is free of damage or waste;
(ix) an estoppel certificate certified to Lender and Landlord
stating (1) that the Substitution Lease is in full force and effect and is a
valid and binding obligation of Tenant, (2) that there are no defaults under the
Substitution Lease, (3) that Tenant has no defense or offset to the payment of
rent under the Substitution Lease, (4) the dates of lease commencement, rent
commencement and lease expiration, (5) that no rent has been paid for more than
one (1) month in advance, (6) that Tenant has no right or option of first offer
or first refusal under the Substitution Lease to purchase the Substitution
Premises, and (7) that Landlord has satisfied all requirements with respect to
the delivery of the Substitute Premises and Tenant is in occupancy thereof;
(x) a subordination, non-disturbance and attornment
agreement with respect to the Substitution Lease in the form delivered in
connection with the Lease of the Withdrawn Premises;
(xi) a release of Lender and Landlord, and their respective
officers, directors, employees and agents, from all claims and liability
relating to the Withdrawn Premises through and including the date of the
effecting of the Substitution; and
(xii) such other and further documents and information in
connection with the Substitution as the Rating Agencies (if the Loan is part of
a Secondary Market Transaction), Landlord or Lender may request.
(t) Notwithstanding Tenant's satisfaction of all of the conditions
and requirements for a Substitution in accordance with this Paragraph 32, the
Substitution shall be subject to the consent of Lender and the residual value
insurance provider, if any, which consent shall not be unreasonably withheld.
33. Right of First Refusal.
(a) Except in transactions consummated prior to the first (1st)
anniversary of the Commencement Date, Landlord shall not at any time during the
Term sell or convey or agree to sell or convey the Leased Premises without first
having complied with the requirements of this Paragraph 33. Provided that no
Event of Default exists or has occurred and is continuing, if Landlord shall
desire to sell or convey the Leased Premises and Landlord shall obtain an offer,
acceptable to Landlord, to purchase the Leased Premises, then Landlord shall
submit a written copy of the offer to Tenant and shall give Tenant ten (10) days
within which to elect to purchase the Leased Premises on the precise terms and
conditions of the offer (except that if the offer shall be in whole or in part
for consideration other than cash, Tenant shall have the right to pay in cash
the fair market value of such non-cash consideration). If Tenant elects to so
purchase the Leased Premises, Tenant shall give to Landlord written notice
thereof ("Acceptance Notice") and the closing shall be held within sixty (60)
days after the date of the Acceptance Notice, whereupon Landlord shall convey
the Leased Premises to Tenant. At the closing Landlord shall deliver to Tenant a
special warranty deed (or local equivalent), sufficient to convey to Tenant fee
simple
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title to the Leased Premises free and clear of all liens, restrictions and
encumbrances, except for the Permitted Encumbrances, liens or encumbrances
created, suffered or consented to in writing by Tenant or arising by reason of
the failure of Tenant to have observed or performed any term, covenant or
agreement herein to be observed or performed by Tenant, the lien of any
Impositions then affecting the Leased Premises, this Lease and, if the Leased
Premises are to be conveyed subject to the outstanding balance of the Loan, the
Mortgage and all other Loan documents. In the event Tenant shall elect not to so
purchase the Leased Premises, Landlord may thereafter sell the Leased Premises
only to the party making the offer or its assignee(s) and only in accordance
with the terms thereof, unless a further offer is submitted to Tenant in
accordance with this Paragraph 33.
(b) In no event shall the provisions of this Paragraph 33 or the
rights and privileges of Tenant under this Paragraph 33 be construed as limiting
in any manner any other rights granted elsewhere in this Lease to Tenant.
(c) Notwithstanding anything to the contrary herein, the
provisions of this Paragraph 33 shall not apply to (i) any sale or conveyance of
the Leased Premises in foreclosure sale (or similar proceeding) of a bona-fide
mortgage or deed of trust or to any conveyance in lieu of foreclosure of such a
mortgage or deed of trust, or to any transfer subsequent to a foreclosure sale
or deed in lieu thereof in connection with the requirements of Standard &
Poor's, Moody's or any other Rating Agencies if the Loan is securitized, (ii)
any sale or conveyance of the Leased Premises which occurs during the existence
of an Event of Default hereunder, or (iii) any sale, conveyance, alienation,
mortgage, encumbrance, pledge or transfer of the beneficial ownership interest,
membership interest or other equity interest in Landlord, or the change of the
trustee, manager or other controlling person of the Landlord.
(d) If Landlord shall obtain an offer with respect to a sale or
conveyance of all or any portion of the Leased Premises, and sells the Leased
Premises (to Tenant or anyone else) Tenant hereby acknowledges and consents as
follows: (i) any such sale or conveyance during any period in which the Loan may
not be prepaid or defeased, as the case may be, shall be subject to the
outstanding balance of the Loan (which shall be the non-cash portion of the
purchase price), and, if Tenant shall be entitled to, and shall, exercise its
rights under this Paragraph 33, the Loan, Note, Mortgage and other Loan
documents will be assumed by Tenant, and the lien of the Mortgage may not be
released during such period; (ii) such sale shall be in accordance with and
subject to the terms and provisions of the Note, the Mortgage and the other Loan
Documents, whether such purchase contemplates the purchase of the Leased
Premises subject to the lien of the Mortgage or for a release of the lien of the
Mortgage; and (iii) if the lien of the Mortgage is not released in connection
with such sale of the Leased Premises, and if Tenant acquires the Leased
Premises, no merger of title shall occur and this Lease and any guaranty of this
Lease will remain in full force and effect in accordance with their terms.
(e) If Tenant shall have agreed to purchase the Leased Premises
pursuant to an offer under which the third party offeror was to acquire the
Leased Premises under and subject to the lien of the Mortgage, and if such
purchase by Tenant of the Leased Premises shall occur at a time when the Loan
may be prepaid or defeased, as the case may be, Tenant may, at it's option (but
without any obligation to do so) purchase the Leased Premises for cash free and
clear of the Mortgage but only if (i) the cash portion of the offer is increased
by an amount equal
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to the principal and interest secured by the Mortgage, and (ii) Tenant pays (in
addition to the purchase price) all prepayment premiums or defeasance deposits,
yield maintenance amounts, satisfaction fees and any and all other sums which
become owing as a result of such prepayment or defeasance, as the case may be;
all to the end and effect that Landlord will net the same amount as Landlord
would have netted had the Leased Premises been sold under and subject to the
lien of the Mortgage, pursuant to the offer.
34. Separability. Each and every covenant and agreement contained in
this Lease is, and shall be construed to be, a separate and independent covenant
and agreement, and the breach of any such covenant or agreement by Landlord
shall not discharge or relieve Tenant from its obligation to perform the same.
If any term or provision of this Lease or the application thereof to any
provision of this Lease or the application thereof to any person or
circumstances shall to any extent be invalid and unenforceable, the remainder of
this Lease, or the application of such term or provision to person or
circumstances other than those as to which it is invalid or unenforceable, shall
not be affected thereby, and each term and provision of this Lease shall be
valid and shall be enforced to the extent permitted by law.
35. Miscellaneous.
(a) The paragraph headings in this Lease are used only for
convenience in finding the subject matters and are not part of this Lease or to
be used in determining the intent of the parties or otherwise interpreting this
Lease.
(b) As used in this Lease the singular shall include the plural as
the context requires and the following words and phrases shall have the
following meanings: (i) "including" shall mean "including but not limited to";
(ii) "provisions" shall mean "provisions, terms, agreements, covenants and/or
conditions"; (iii) "lien" shall mean "lien, charge, encumbrance; title retention
agreement, pledge, security interest, mortgage and/or deed of trust"; and (iv)
"obligation" shall mean "obligation, duty, agreement, liability, covenant or
condition".
(c) Any act which Landlord is permitted to perform under this
Lease may be performed at any time and from time to time by Landlord or any
person or entity designated by Landlord. Any act which Tenant is required to
perform under this Lease shall be performed at Tenant's sole cost and expense.
(d) This Lease may be modified, amended, discharged or waived only
by an agreement in writing signed by the party against whom enforcement of any
such modification, amendment, discharge or waiver is sought.
(e) The covenants of this Lease shall run with the Land and bind
Tenant, the successors and assigns of Tenant and all present and subsequent
encumbrances and subtenants of any of the Leased Premises, and shall inure to
the benefit of and bind Landlord, its successors and assigns.
(f) This Lease will be simultaneously executed in several
counterparts, each of which when so executed and delivered shall constitute an
original, fully enforceable counterpart for all purposes.
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(g) This Lease shall be governed by and construed according to the
laws of the State in which the Leased Premises is located.
(h) Unless expressly stated otherwise herein, wherever Tenant
requests the consent or approval of Landlord, Landlord agrees that it will not
unreasonably withhold or delay such consent or approval.
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, Landlord and Tenant have caused this instrument to be
executed under seal as of the day and year first above written.
LANDLORD:
QFI-LITTLE ROCK AR, LLC, a Delaware limited
liability company
By:________________________
Name: _____________________
Title: ______________________
TENANT:
QUALITY FOODS, INC., an Arkansas corporation
By:________________________
Name: ______________________
Title: _______________________
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APPENDIX A
"Additional Rent" shall mean all amounts, costs, expenses, liabilities and
obligations (including Tenant's obligation to pay any Net Awards, Purchase
Price, Default Rate interest or Late Charges hereunder) which Tenant is required
to pay pursuant to the terms of this Lease other than Basic Rent.
"Additional Payments" shall mean all amounts (i) that are out-of-pocket
costs incurred or payable by Landlord or Lender in connection with the transfer
of the Leased Premises to Tenant, and (ii) that are out-of-pocket costs, charges
or penalties (including prepayment or defeasance costs and penalties), if any,
incurred by Landlord and Lender as a result of the prepayment or defeasance of a
Note(s), and (iii) that are due and owing to Lender or Landlord by reason of any
default by Tenant in complying with its obligations under this Lease.
"Affiliate" of any Person shall mean any other Person directly or
indirectly controlling, controlled by or under common control with, such Person
and shall include, if such Person is an individual, members of the immediate
family of such Person, and trusts for the benefit of such individual. For the
purposes of this definition, the term "control" (including the correlative
meanings of the terms "controlling", "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
policies of such Person, whether through the ownership of voting securities or
by contract or otherwise.
"After-Tax Basis" shall mean, with respect to any payment received or
accrued by any Person, the amount of such payment (the "base payment")
supplemented by a further payment (the "additional payment") to that Person so
that the sum of the base payment plus the additional payment shall, after taking
into account the amount of all Taxes required to be paid by such Person in
respect of the receipt or accrual of the base payment and the additional payment
(after any current credits or deductions arising therefrom and the timing
thereof), be equal to the amount required to be received. Such calculations
shall be made (a) in the case of entities subject to United States Federal
income tax, at the highest marginal United States federal, state and local
income tax rates applicable to individuals or corporations (as the case may be)
resident or domiciled in the jurisdiction where the recipient of such payment is
located (or where the recipient indicates such payment will be required to be
reported, if different); (b) in the case of an organization exempt from United
States Federal income tax, at the highest marginal United States federal, state
and local tax rates applicable to unrelated business taxable income (or any tax
that is a supplement or addition to or substitute for or in lieu thereof,
whether or not expressly so designated), but only if the payments with respect
to the Leased Premises are subject to such tax or (c), if Landlord is not a US
taxpayer, at Landlord's actual effective overall tax rate, if lower. In the case
of any flow through entity, "Landlord" shall include the direct or indirect
members or other equity owners of Landlord that are required to report the gross
or net income of Landlord and/or other items of income, expense, deduction and
credit with respect thereto, and in the case of any entity, "Landlord" and the
owners thereof shall include any consolidated, combined or unitary group of
which Landlord is a part for income tax purposes.
"Alteration" or "Alterations" shall mean any or all changes, additions
(whether or not adjacent to or abutting any then existing buildings), expansions
(whether or not adjacent to or
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abutting any then existing buildings), improvements, reconstructions, removals
or replacements of any of the Improvements or Equipment, both interior or
exterior, and ordinary and extraordinary.
"Applicable Laws" shall mean all existing and future applicable laws
(including common laws), rules, regulations, statutes, treaties, codes,
ordinances, permits, certificates, orders and licenses of any Governmental
Authorities, and applicable judgments, decrees, injunctions, writs, orders or
like action of any court, arbitrator or other administrative, judicial or
quasi-judicial tribunal or agency of competent jurisdiction (including those
pertaining to the environment and those pertaining to the construction, use or
occupancy of the Leased Premises). Applicable Laws shall include Environmental
Laws.
"Basic Rent" shall mean the amounts set forth on Exhibit B annexed to this
Lease.
"Basic Rent Payment Dates" shall mean the last business day of April, 2004
and the last business day of each month thereafter during the Term.
"CERCLA" shall mean the Comprehensive Environmental Response, Compensation
and Liability Act, as amended by the Superfund Amendments and Reauthorization
Act of 1986, 42 U.S.C. Sections 9601-9657.
"Claims" shall mean Liens (including, without limitation, lien removal and
bonding costs), liabilities, obligations, damages, losses, demands, penalties,
assessments, payments, fines, claims, actions, suits, judgments, settlements,
costs, expenses and disbursements (including, without limitation, reasonable
legal fees and expenses and costs of investigation) of any kind and nature
whatsoever.
"Closing Date" shall mean the date upon which title to the Leased Premises
is conveyed to Tenant in accordance with Paragraph 13 or Paragraph 14 of this
Lease, as applicable, and Tenant pays to Landlord the Purchase Price, Additional
Payments and any and all other amounts required to be paid hereunder, which date
shall in no event be later than the later to occur (i) the date that is thirty
(30) days after the date the fair market purchase value is determined, and (ii)
the thirtieth (30th) day after Landlord's notice to Tenant accepting Tenant's
offer to purchase the Leased Premises in accordance with Paragraph 13 or
Paragraph 14 of this Lease, as applicable.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
"Commencement Date" shall mean the date hereof.
"Condemnation" shall mean a Taking and/or a Requisition.
"Default Rate" shall mean a rate of interest equal to the higher of (i)
two (2%) percent per annum above the then current Prime Rate, and (ii) an amount
equal to the default rate charged by Lender under the Mortgage; provided,
however, in no event shall the Default Rate be greater than four (4%) percent
per annum above the then current Prime Rate.
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"Easements" shall mean easements, covenants, waivers, approvals or
restrictions for utilities, parking or other matters as desirable for operation
of the Leased Premises or properties adjacent thereto.
"Environmental Laws" shall mean and include the Resource Conservation and
Recovery Act of 1976 (RCRA), 42 U.S.C. Sections 6901-6987, as amended by the
Hazardous and Solid Waste Amendments of 1984, CERCLA, the Hazardous Materials
Transportation Act of 1975, 49 U.S.C. Sections 1801-1812, the Toxic Substances
Control Act, 15 U.S.C. Sections 2601-2671, the Clean Air Act, 42 U.S.C. Sections
7401 et seq., the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C.
Sections 136 et seq and all other federal, state and local laws, ordinances,
rules, orders, statutes, codes and regulations applicable to the Leased Premises
and (i) relating to the environment, human health or natural resources, (ii)
regulating, controlling or imposing liability or standards of conduct concerning
Hazardous Materials, or (iii) regulating the clean-up or other remediation of
the Leased Premises or any portion thereof, as any of the foregoing may have
been amended, supplemented or supplanted from time to time.
"Equipment" shall mean, collectively, the machinery and equipment which is
attached to the Improvements in such a manner as to become fixtures under
applicable law, together with all additions and accessions thereto,
substitutions therefor and replacements thereof permitted by this Lease,
excepting therefrom the Trade Fixtures.
"Event of Default" shall mean the occurrence of any one or more of the
following events under this Lease: (i) a failure by Tenant to make (regardless
of the pendency of any bankruptcy, reorganization, receivership, insolvency or
other proceedings, in law, in equity or before any administrative tribunal which
had or might have the effect of preventing Tenant from complying with the
provisions of this Lease) any payment of Basic Rent, Additional Rent or any
other sum herein required to be paid by Tenant which continues unremedied for a
period of five (5) business days after due and payable; (ii) failure by Tenant
to perform and observe, or a violation or breach of, any other provision in this
Lease and such default shall continue for a period of thirty (30) days after
written notice thereof is given by Landlord or Lender or Lender's designee to
Tenant, or if such default is of such a nature that it cannot reasonably be
cured within such period of thirty (30) days, such period shall be extended for
such longer time as is reasonably necessary (not to exceed sixty (60) additional
days) provided that Tenant has commenced to cure such default within said period
of thirty (30) days and is actively, diligently and in good faith proceeding
with continuity to remedy such default; (iii) any representation or warranty
made in this Lease is determined by a court of competent jurisdiction to have
been false or misleading in any material respect at the time made; (iv) Tenant
or any guarantor of Tenant's obligations hereunder shall (A) voluntarily be
adjudicated a bankrupt or insolvent, (B) voluntarily consent to the appointment
of a receiver or trustee for itself or for any of the Leased Premises, (C)
voluntarily file a petition seeking relief under the bankruptcy or other similar
laws of the United States, any state or any jurisdiction, or (D) voluntarily
file a general assignment for the benefit of creditors; (v) a court shall enter
an order, judgment or decree appointing, with the voluntary consent of Tenant or
any guarantor of Tenant's obligations hereunder, a receiver or trustee for
Tenant or any guarantor of Tenant's obligations hereunder or for the Leased
Premises or approving a petition filed against Tenant or any guarantor of
Tenant's obligations hereunder which seeks relief under the bankruptcy or other
similar laws of the United States or any State, and such order, judgment or
decree shall remain in force, undischarged or unstayed, sixty (60)
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days after it is entered; (vi) Tenant or any guarantor of Tenant's obligations
hereunder shall in any insolvency proceedings be liquidated or dissolved or
shall voluntarily commence proceedings towards its liquidation or dissolution;
or (vii) the estate or interest of Tenant in the Leased Premises shall be levied
upon or attached in any proceeding and such estate or interest is about to be
sold or transferred or such process shall not be vacated or discharged within
thirty (30) days after such levy or attachment.
"Expiration Date" shall mean April 30, 2026.
"GAAP" shall mean generally accepted accounting principles as in effect
from time to time in the United States of America.
"Governmental Authority" shall mean any federal, state, county, municipal,
foreign or other governmental or regulatory authority, agency, board, body,
instrumentality, court or quasi governmental authority (or private entity in
lieu thereof).
"Guaranties" shall mean all warranties, guaranties and indemnities,
express or implied, and similar rights which Landlord may have against any
manufacturer, seller, engineer, contractor or builder in respect of any of the
Leased Premises, including, but not limited to, any rights and remedies existing
under contract or pursuant to the Uniform Commercial Code.
"Hazardous Materials" shall mean all chemicals, petroleum, crude oil or
any fraction thereof, hydrocarbons, polychlorinated biphenyls (PCBs), asbestos,
asbestos-containing materials and/or products, urea formaldehyde, or any
substances which are classified as "hazardous" or "toxic" under CERCLA;
hazardous waste as defined under the Solid Waste Disposal Act, as amended 42
U.S.C. Section 6901; air pollutants regulated under the Clean Air Act, as
amended, 42 U.S.C. Section 7401, et seq.; pollutants as defined under the Clean
Water Act, as amended, 33 U.S.C. Section 1251, et seq., any pesticide as defined
by Federal Insecticide, Fungicide, and Rodenticide Act, as amended, 7 U.S.C.
Section 136, et seq., any hazardous chemical substance or mixture or imminently
hazardous substance or mixture regulated by the Toxic Substances Control Act, as
amended, 15 U.S.C. Section 2601, et seq., any substance listed in the United
States Department of Transportation Table at 45 CFR 172.101; any chemicals
included in regulations promulgated under the above listed statutes; any
explosives, radioactive material, and any chemical regulated by state statutes
similar to the federal statutes listed above and regulations promulgated under
such state statutes.
"Holder" shall mean, as of any particular date, any holder of a promissory
note secured by a Mortgage.
"Impositions" shall mean, collectively, all Taxes of every kind and nature
on or with respect to the Leased Premises, or the use, lease, ownership or
operation thereof; all charges and/or taxes for any easement or agreement
maintained for the benefit of the Leased Premises (provided such easement is a
Permitted Encumbrance or was executed with Tenant's consent); all general and
special assessments, levies, permits, inspection and license fees on or with
respect to the Leased Premises; all water and sewer rents and other utility
charges on or with respect to the Leased Premises; all ground rents on or with
respect to the Leased Premises, if any; and all other public charges and/or
taxes whether of a like or different nature, even if unforeseen or
-44-
extraordinary, imposed or assessed upon or with respect to the Leased Premises,
prior to or during the Term, against Landlord, Tenant or any of the Leased
Premises as a result of or arising in respect of the occupancy, leasing, use,
maintenance, operation, management, repair or possession thereof, or any
activity conducted on the Leased Premises, or the Basic Rent or Additional Rent,
including without limitation, any gross income tax, sales tax, occupancy tax or
excise tax levied by any governmental body on or with respect to such Basic Rent
or Additional Rent; all payments required to be made to a governmental or
quasi-governmental authority (or private entity in lieu thereof) that are in
lieu of any of the foregoing, whether or not expressly so designated; and any
penalties, fines, additions or interest thereon or additions thereto.
"Improvements" shall mean, collectively, the buildings, structures and
other improvements on the Land.
"Indemnitee" shall mean Landlord, Lender, any Holder, any servicer of a
Loan, any trustee under a Mortgage which is a deed of trust, each of their
assignees or other transferees and each of their Affiliates and their respective
officers, directors, employees, shareholders, members or other equity owners.
["Index" means the Consumer Price Index - United States (1982 = 100), All
Urban Consumers; provided, however, that if publication of such Index shall be
discontinued, the parties shall thereafter replace the Index with a similar
index using comparable statistics to compute the cost of living in the area in
which the Leased Premises is located, published by an agency of the United
States or by a responsible financial periodical of recognized authority to be
selected and agreed upon by Landlord and Tenant at such time.]
"Initial Term" shall mean the period of time commencing on the
Commencement Date and terminating on the Expiration Date.
"Insurance Expiration Date" shall mean, with respect to an insurance
policy, the date that such insurance policy will expire.
"Insurance Requirement" or "Insurance Requirements" shall mean, as the
case may be, any one or more of the terms of each insurance policy required to
be carried by Tenant under this Lease and the requirements of the issuer of such
policy, and whenever Tenant shall be engaged in making any Alteration or
Alterations, repairs or construction work of any kind (collectively, "Work"),
the term "Insurance Requirement" or "Insurance Requirements" shall be deemed to
include a requirement that Tenant obtain or cause its contractor to obtain
completed value builder's risk insurance when the estimated cost of the Work in
any one instance exceeds the sum of Three Hundred Fifty Thousand ($350,000.00)
Dollars and that Tenant or its contractor shall obtain worker's compensation
insurance or other adequate insurance coverage covering all persons employed in
connection with the Work, whether by Tenant, its contractors or subcontractors
and with respect to whom death or bodily injury claims could be asserted against
Landlord.
"Land" shall mean the lot(s) or parcel(s) of land described in Exhibit "A"
attached to this Lease and made a part hereof, together with the easements,
rights and appurtenances thereunto belonging or appertaining.
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"Landlord" shall mean QFI-Little Rock AR, LLC, a Delaware limited
liability company.
"Late Charge" shall mean, with respect to an overdue installment of Basic
Rent, an amount equal to the greater of (i) three percent (3%) of such overdue
installment of Basic Rent, or (ii) an amount equal to the late charge or late
fee charged by Lender under the Mortgage; provided, however, that in no event
shall the Late Charge be greater than five percent (5%) of such overdue
installment of Basic Rent.
"Law" shall mean any constitution, statute or rule of law. "Lease
Guarantor" shall mean Performance Food Group Company, a Tennessee corporation,
as guarantor of Tenant's obligations under this Lease pursuant to the Lease
Guaranty.
"Lease Guaranty" shall mean that certain Corporate Guaranty dated as of
the date hereof from Lease Guarantor in favor of Landlord, its successors and
assigns, in the form of Exhibit E annexed to this Lease.
"Leased Premises" shall mean, collectively, the Land, the Improvements and
the Equipment, together with any and all other property and interest in property
conveyed to Landlord pursuant to the deeds, bills of sale or other documents
executed in connection with the purchase of the Land by Landlord.
"Legal Requirement" or "Legal Requirements" shall mean, as the case may
be, any one or more of all present and future laws, codes, ordinances, orders,
judgments, decrees, injunctions, rules, regulations and requirements, even if
unforeseen or extraordinary, of every duly constituted governmental authority or
agency (but excluding those which by their terms are not applicable to and do
not impose any obligation on Tenant, Landlord or the Leased Premises) and all
covenants, restrictions and conditions now of record which may be applicable to
Tenant, Landlord (with respect to the Leased Premises) or to all or any part of
or interest in the Leased Premises, or to the use, manner of use, occupancy,
possession, operation, maintenance, alteration, repair or reconstruction of the
Leased Premises, even if compliance therewith (i) necessitates structural
changes or improvements (including changes required to comply with the
"Americans with Disabilities Act") or results in interference with the use or
enjoyment of the Leased Premises or (ii) requires Tenant to carry insurance
other than as required by the provisions of this Lease.
"Lender" shall mean an entity identified as such in writing to Tenant
which makes a Loan to Landlord, secured by a Mortgage and evidenced by a Note or
which is the holder of the Mortgage and Note as a result of an assignment
thereof.
"Lien" shall mean any lien, mortgage, pledge, charge, security interest or
encumbrance of any kind, or any type of preferential arrangement that has the
practical effect of creating a security interest, including, without limitation,
any thereof arising under any conditional sale agreement, capital lease or other
title retention agreement.
"Loan" shall mean a loan made by a Lender to Landlord secured by a
Mortgage and evidenced by a Note.
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"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Mortgage" shall mean a first priority mortgage, deed of trust or similar
security instrument hereafter executed covering the Leased Premises from
Landlord to Lender.
"Net Award" shall mean the entire award payable to Landlord or a Lender by
reason of a Condemnation, less any reasonable expenses incurred by Landlord in
collecting such award and excluding Tenant's Award, if any (to the extent Tenant
is entitled to Tenant's Award pursuant to the terms of this Lease).
"Net Proceeds" shall mean the entire proceeds of any insurance required
under clause (i), (iv), (v) or (vi) of Paragraph 14 (a) of this Lease, less any
actual and reasonable expenses incurred by Landlord in collecting such proceeds.
"Notice" or "Notices" shall mean all notices, demands, requests, consents,
approvals, offers, statements and other instruments or communications required
or permitted to be given pursuant to the provisions of this Lease.
"Note" or "Notes" shall mean a Promissory Note or Notes hereafter executed
from Landlord to Lender, which Note or Notes will be secured by a Mortgage and
an assignment of leases and rents.
"Permitted Encumbrances" shall mean those covenants, restrictions,
reservations, liens, conditions, encroachments, easements and other matters of
title that affect the Leased Premises as of the date of Landlord's acquisition
thereof, excepting, however, any such matters arising from the acts of Landlord
(such as liens arising as a result of judgments against Landlord).
"Person" shall mean an individual, corporation, partnership, joint
venture, association, joint-stock company, trust, limited liability company,
non-incorporated organization or government or any agency or political
subdivision thereof.
"Prime Rate" shall mean the prime rate of interest published in the Wall
Street Journal or its successor, from time to time.
"Purchase Price" shall mean the greater of the Stipulated Value or the
fair market purchase value of the Leased Premises. To determine the fair market
purchase value, Landlord shall designate an independent MAI appraiser within
twenty (20) days after Tenant's offer to purchase the Leased Premises. Within
ten (10) days after selection of Landlord's appraiser, Landlord shall notify
Tenant of the determination made by Landlord's appraiser with respect to the
fair market purchase value of the Leased Premises. Tenant shall then have ten
(10) days to dispute such determination and to select its own independent MAI
appraiser. In the event that Tenant fails to select its appraiser within such
ten (10) day period, the determination of Landlord's appraiser shall constitute
the fair market purchase value. Within ten (10) days after selection of Tenant's
appraiser, the two appraisers shall meet and attempt to agree as to the fair
market purchase value for the Leased Premises. With respect to a Condemnation,
the appraised fair market purchase value shall be determined on an "as is" basis
immediately prior to the Condemnation and based upon the assumption that such
Condemnation was not to occur. With respect to a casualty, the appraised fair
market purchase value shall be determined on an "as
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built" basis after full Restoration. In the event that such appraisers are
unable to agree as to such fair market purchase value then: (i) if the
difference between the two determinations is less than five percent (5%) of the
lower determination, then the average of the two determinations shall be deemed
to constitute fair market purchase value; or (ii) if the difference between the
two determinations is equal to or greater than five percent (5%) of the lower
determination, then the two appraisers shall jointly select a third independent
MAI appraiser, which appraiser shall select which of the determinations of the
first two appraisers shall constitute the fair market purchase value. Such third
appraiser shall not have the right to vary or modify the determinations of the
appraisers selected by Landlord and Tenant. Any appraiser selected by Tenant or
Landlord must have at least ten (10) years experience in appraising commercial
real estate in the area in which the Leased Premises is located. The appraisers
shall not have the right to amend, modify or vary any of the terms of this Lease
and the determination of the appraisers shall be final, binding and conclusive
upon Landlord and Tenant. In any event, the fair market value of the Leased
Premises shall exclude any value that is attributable to (x) Tenant's Trade
Fixtures, or (y) any Alterations for which all costs and expenses were paid for
by Tenant.
"Rating Agency" or "Rating Agencies" shall mean, if any, one or more of
Standard & Poor's, Xxxxx'x, Fitch or any other rating agency that has rated the
Loan, the Mortgage or the REMIC Trust or any other trust or entity in which the
Loan and the Mortgage have been placed.
"REA" shall mean a reciprocal easement agreement or any other agreement or
document of record now affecting the Leased Premises.
"Release" shall mean the release under applicable Environmental Laws or
the threatened release of any Hazardous Materials into or upon any land or water
or air, or otherwise into the environment, including, without limitation, by
means of burial, disposal, discharge, emission, injection, spillage, leakage,
seepage, leaching, dumping, pumping, pouting, escaping, emptying, placement and
the like.
"REMIC" shall mean a "real estate mortgage investment conduit" within the
meaning of the Code.
"REMIC Provisions" shall mean the provisions of the federal income tax law
relating to REMICs, which appear at Sections 860A through 860G of the Code, and
any related provisions and proposed, temporary and final Treasury regulations
and published rulings, notices and announcements promulgated thereunder, as the
foregoing may be in effect from time to time.
"Renewal Option Notice" shall mean a written notice from Tenant to
Landlord of its election to extend the Term (or any then Renewal Term) of this
Lease pursuant to Paragraph 5 of this Lease.
"Renewal Term" shall mean an additional Lease term of five (5) years.
"Replaced Equipment" shall mean Equipment that has been replaced by Tenant
with Replacement Equipment.
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"Replacement Equipment" shall mean operational equipment or other parts
used by Tenant to replace any of the Equipment.
"Requisition" shall mean any temporary condemnation or confiscation of the
use or occupancy of the Leased Premises by any governmental authority, civil or
military, whether pursuant to an agreement with such governmental authority in
settlement of or under threat of any such requisition or confiscation, or
otherwise.
"Restoration" shall mean, following a casualty or Condemnation, the
restoration of the Leased Premises to as nearly as possible its value, condition
and character immediately prior to such casualty or Condemnation, in accordance
with the provisions of this Lease, including but not limited to the provisions
of Paragraphs 11(a), 12 and 15. Notwithstanding the foregoing, such Restoration
may depart from the exact condition of the Leased Premises immediately prior to
the casualty or Condemnation, provided that (i) the fair market value of the
Leased Premises shall not be lessened after the completion of the Restoration,
(ii) the use of the Leased Premises shall not be changed to a use that is not
permitted by this Lease as a result of any such Restoration, (iii) all such
Restoration shall be performed in a good and workmanlike manner, and shall be
expeditiously completed in compliance with all Legal Requirements, (iv) Tenant
shall (subject to the provisions of Paragraph 18 hereof) discharge all liens
filed against any of the Leased Premises arising out of the same, and (v) no
such Alteration shall create any debt or other encumbrance(s) on the Leased
Premises.
"Restoration Fund" shall mean, collectively, the Net Proceeds, Restoration
Award and Tenant Insurance Payment.
"Restoration Award" shall mean that portion of the Net Award equal to the
cost of Restoration.
"SEC" shall mean the Securities and Exchange Commission.
"Secondary Market Transaction" shall be (i) any sale of the Loan documents
to one or more investors as a whole loan; (ii) a participation of the loan to
one or more investors, (iii) any deposit of the loan documents in a trust or
other entity that may sell certificates or other instruments to investors
evidencing an ownership interest in the assets of such trust or other entity, or
(iv) any other sale or transfer of the loan or any interest therein to one or
more investors.
"Standard & Poor's" shall mean Standard & Poor's Ratings Services.
"State" shall mean the State or Commonwealth in which the Leased Premises
is situated.
"Stipulated Value" shall mean the stipulated value computed in accordance
with Exhibit F of this Lease.
"Subsidiary" of a Person means any corporation, association, partnership,
limited liability company, joint venture or other business entity of which more
than fifty percent (50%) of the voting stock, membership interests or other
equity interests (in the case of Persons other than corporations), is owned or
controlled directly or indirectly by the Person, or one or more of the
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Subsidiaries of the Person, or a combination thereof. Unless the context
otherwise clearly requires, references herein to a "Subsidiary" refer to a
Subsidiary of Tenant.
"Substitution Lease" shall mean a lease of the Substitute Premises on the
same terms and conditions as this Lease with respect to the Withdrawn Premises,
including, without limitation, the same rental terms with respect to the
Withdrawn Premises, for the remaining term of the Lease (including all remaining
renewal terms thereunder).
"Substitute Premises" shall mean the premises that are substituted under
this Lease for the Withdrawn Premises pursuant to Paragraph 32.
"Substitution" shall mean the substitution under this Lease of the
Substitute Premises for the Withdrawn Premises pursuant to Paragraph 32.
"Taking" shall mean any taking of the Leased Premises in or by
condemnation or other eminent domain proceedings pursuant to any law, general or
special, or by reason of any agreement with any condemnor in settlement of or
under threat of any such condemnation or other eminent domain proceedings or by
any other means, or any de facto condemnation.
"Tangible Net Worth" shall mean, with respect to any Person, total
shareholders' equity less goodwill of such Person.
"Tax" or "Taxes" shall mean any and all present and future taxes,
including income (gross or net), gross or net receipts, sales, use, value added,
franchise, doing business, transfer, capital, property (tangible or intangible),
ad valorem, municipal assessments, excise and stamp taxes, levies, imposts,
duties, charges, assessments or withholding, together with any penalties, fines,
additions or interest thereon or additions thereto (any of the forgoing being
referred to herein individually as a "Tax"), imposed by any Governmental
Authority. Taxes shall include the costs of any contest or appeal pursued which
reduces the Taxes (or attempts to do so) including reasonable attorneys' fees
and costs incident thereto. Without limiting the foregoing, if at any time
during the term of this Lease the methods of taxation prevailing at the
execution hereof shall be changed or altered so that in lieu of or as a
supplement or addition to or a substitute for the whole or any part of the real
estate taxes or assessments now or from time to time thereafter levied, assessed
or imposed by applicable taxing authorities for the funding of governmental
services, there shall be imposed (i) a tax, assessment, levy, imposition or
charge, wholly or partially as a capital levy or otherwise, on the gross rents
received or otherwise attributable to the Leased Premises, or (ii) a tax,
assessment, levy (including but not limited to any municipal, state or federal
levy), imposition or charge measured by or based in whole or in part upon the
Leased Premises or this Lease, and imposed on the Landlord under this Lease or
any portion thereof, or (iii) a license fee or other fee or tax measured by the
gross rent payable under this Lease, or (iv) any other tax, assessment, levy,
charge, fee or the like payable with respect to the Leased Premises, the rents,
issues and profits thereof, then all such taxes, assessments, levies,
impositions and/or charges, or the part thereof so measured or based, shall be
deemed to be Taxes.
"Tax Indemnitee" shall mean Landlord, Lender, any Holder, any servicer of
a Loan, any trustee under a Mortgage which is a deed of trust, each of their
assignees or other transferees and
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each of their Affiliates and their respective officers, directors, employees,
shareholders, members or other equity owners.
"Tenant" shall mean Quality Foods, Inc., an Arkansas corporation.
"Tenant's Award" shall mean, to the extent Tenant shall have a right to
make a separate claim therefor against the condemnor, a Condemnation award
relating solely to the value of the leasehold interest created by this Lease or
any award or payment (in connection with a Condemnation) on account of Trade
Fixtures, Tenant's moving expenses, business losses and Tenant's out-of-pocket
expenses incidental to the move, if available.
"Tenant's Insurance Payment" shall mean, in the event of a damage or
destruction, the amount of the proceeds that would have been payable under the
third-party insurance required to be maintained pursuant to Paragraph
14(a)(i),(iv),(v) or (vi) had such insurance program been in effect .
"Tenant's Termination Notice" shall mean a written notice from Tenant to
Landlord after a Condemnation or casualty of Tenant's intention to terminate
this Lease and setting forth therein the Termination Date and Tenant's offer to
purchase the Leased Premises in accordance with Paragraph 13 or Paragraph 14 of
this Lease, as applicable.
"Term" shall mean the Initial Term, together with any Renewal Term.
"Termination Date" shall mean the date for the termination of this Lease
pursuant to Tenant's Termination Notice, which date shall be on a Basic Rent
Payment Date occurring no sooner than thirty (30) days after the date of
Landlord's notice to Tenant rejecting Tenant's offer to purchase the Leased
Premises pursuant to Paragraph 13 or Paragraph 14 of this Lease, as applicable.
"Trade Fixtures" shall mean all fixtures, equipment and other items of
personal property (whether or not attached to the Improvements) which are owned
by Tenant and used solely in connection with the operation of the business
conducted on the Leased Premises and which are not necessary for the operation
of the Leased Premises. Without limiting the foregoing, warehouse racking shall
be deemed a Trade Fixture of purposes of this Lease.
"Trustee" shall mean a federally insured bank or other financial
institution, selected by Landlord and Tenant and reasonably satisfactory to
Lender.
"Withdrawn Premises" shall mean the Leased Premises withdrawn from the
Lease in accordance with the terms and conditions of Paragraph 32.
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