NET LEASE AGREEMENT
THIS LEASE, made and entered into effective as of the 1st
day of May, 1998, by and among AEI Real Estate Fund XVIII Limited
Partnership, a Minnesota limited partnership whose corporate
general partner is AEI Fund Management XVIII, Inc., a Minnesota
corporation ("Fund XVIII"), whose principal business address is
1300 Minnesota World Trade Center, 00 Xxxx Xxxxxxx Xxxxxx, Xx.
Xxxx, Xxxxxxxxx 00000 (hereinafter collectively referred to as
"Lessor"), and Tumbleweed, LLC., a Kentucky limited liability
company (hereinafter referred to as "Lessee"), whose principal
business address is 0000 Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx;
WITNESSETH:
WHEREAS, Lessor is the fee owner of a certain parcel of real
property and improvements located at East Broad Street, Columbus,
Ohio, and legally described in Exhibit "A", which is attached
hereto and incorporated herein by reference; and
WHEREAS, Lessee will be constructing the building and
improvements (together the "Building") on the real property
described in Exhibit "A", which Building is described in the
plans and specifications heretofore submitted to Lessor; and
WHEREAS, Lessee desires to lease said real property and
Building (said real property and Building hereinafter referred to
as the "Leased Premises"), from Lessor upon the terms and
conditions hereinafter provided;
NOW, THEREFORE, in consideration of the Rents, terms,
covenants, conditions, and agreements hereinafter described to be
paid, kept, and performed by Lessee, Lessor does hereby grant,
demise, lease, and let unto Lessee, and Lessee does hereby take
and hire from Lessor and does hereby covenant, promise, and agree
as follows:
ARTICLE 1. LEASED PREMISES
Lessor hereby leases to Lessee, and Lessee leases and takes
from Lessor, the Leased Premises subject to the conditions of
this Lease.
ARTICLE 2. TERM
(A) The term of this Lease ("Term") shall be Fifteen (15)
consecutive "Lease Years", as hereinafter defined, commencing on
May 1, 1998 ("Occupancy Date").
(B) The first "Lease Year" of the Term shall be for a
period of twelve (l2) consecutive calendar months from the
Occupancy Date. If the Occupancy Date shall be other than the
first day of a calendar month, the first "Lease Year" shall be
the period from the Occupancy Date to the end of the calendar
month of the Occupancy Date, plus the following twelve (l2)
calendar months. Each Lease Year after the first Lease Year
shall be a successive period of twelve (l2) calendar months.
(C) The parties agree that once the Occupancy Date has been
established, upon the request of either party, a short form or
memorandum of this Lease will be executed for recording purposes.
That short form or memorandum of this Lease will set forth the
actual occupancy and termination dates of the Term and optional
Renewal Terms, as defined in Article 28 hereof, and the existence
of any right of renewal, and that said right shall terminate when
the Lessee shall lose right to possession or this Lease is
terminated, whichever occurs first.
ARTICLE 3. CONSTRUCTION OF IMPROVEMENTS
(A) Lessee warrants and agrees that the Building will be
constructed on the Leased Premises, and all other improvements to
the land, including the parking lot, approaches, and service
areas, will be constructed in all material respects by Lessee
substantially in accordance with the plot, plans, and
specifications heretofore submitted to Lessor.
(B) Lessee warrants that the Building and all other
improvements to the land contemplated do comply with the laws,
ordinances, rules, and regulations of all state and local
governments.
(C) Lessee agrees to pay, if not already paid in full, for
all architectural fees and actual construction costs relating to
the Building and other related improvements on the Leased
Premises, in the past, present or future, which shall include,
but not be limited to, plans and specifications, general
construction, carpentry, electrical, plumbing, heating,
ventilating, air conditioning, decorating, equipment
installation, outside lighting, curbing, landscaping,
blacktopping, electrical sign hookup, conduit and wiring from
building, fencing, and parking curbs, builder's risk insurance
(naming Lessor, Lessee, and contractor as co-insured), and all
construction bonds for improvements made by or at the direction
of Lessee.
(D) Opening for business in the Leased Premises by Lessee
shall constitute an acceptance of the Leased Premises and an
acknowledgment by Lessee that the premises are in the condition
described under this Lease.
ARTICLE 4. RENT PAYMENTS
(A) Annual Rent Payable for the first Lease Year:
Lessee shall pay to Lessor an annual Base Rent of
$42,825.73, which amount shall be payable in advance on
the first day of each month in equal monthly
installments of $3,568.81 to Lessor Fund XVIII. If the
first day of the Lease Term is not the first day of a
calendar month, then the monthly Rent payable for that
partial month shall be a prorated portion of the equal
monthly installment of Base Rent.
(B) Annual Rent Payable beginning in the second and
each Lease Year thereafter:
1. In the second and each Lease Year
thereafter, the annual Base Rent due and payable
shall increase by an amount equal to the lesser
of: a) Two Percent (2%) of the Base Rent payable
for the immediately prior Lease Year, or b) A
percentage equal to two times the "CPI-U
Percentage Increase" of the Base Rent payable for
the prior Lease Year.
"CPI-U" shall mean the Consumer Price
Index for All Urban Consumers, (all items),
published by the United States Department of
Labor, Bureau of Labor Statistics (BLS) (1982-84
equal 100), U.S. Cities Average, or, in the event
said index ceases to be published, by any
successor index recommended as a substitute
therefor by the United States Government or a
comparable, nonpartisan substitute reasonably
designated by Lessor. If the BLS changes the base
reference period for the Price Index from 1982-
84=100, the CPI-U Percentage Increase shall be
determined with the use of such conversion formula
or table as may be published by the BLS.
The term "CPI-U Percentage Increase"
shall mean the percentage increase in the CPI-U
determined by reference to the increase, if any,
in the latest monthly CPI-U issued prior to the
first day of the Lease Year for which Base Rent is
being increased, over the CPI-U issued for the
same month in the year prior (e.g., the January
CPI-U for the year 2000 over the January CPI-U for
the year 1999.) Said month's CPI-U shall be used
even though that CPI-U will not be for the month
in which the renewal term commences. In no event
shall the CPI-U Percentage Increase be less than
zero.
(C) Overdue Payments.
Lessee shall pay interest on all overdue payments of Rent or
other monetary amounts due hereunder at the rate of fifteen
percent (15%) per annum or the highest rate allowed by law,
whichever is less, accruing from the date such Rent or other
monetary amounts were properly due and payable.
ARTICLE 5. INSURANCE AND INDEMNITY
(A) Lessee shall, throughout the Term or Renewal Terms, if
any, of this Lease, at its own cost and expense, procure and
maintain insurance which covers the Leased Premises and
improvements against fire, wind, and storm damage (including
flood insurance if the Leased Premises is in a federally
designated flood prone area) and such other risks (including
earthquake insurance, if the Leased Premises is located in a
federally designated earthquake zone or in an ISO high risk
earthquake zone) as may be included in the broadest form of all
risk, extended coverage insurance as may, from time to time, be
available in amounts sufficient to prevent Lessor or Lessee from
becoming a co-insurer within the terms of the applicable
policies. In any event, the insurance shall not be less than one
hundred percent (100%) of the then insurable value, with such
commercially reasonable deductibles as Lessor may reasonably
require from time to time. Additionally, replacement cost
endorsements, vandalism endorsement, malicious mischief
endorsement, waiver of subrogation endorsement, waiver of co-
insurance or agreed amount endorsement (if available), and
Building Ordinance Compliance endorsement and Rent loss
endorsements (for a period of twelve months) must be obtained.
(B) Lessee agrees to place and maintain throughout the Term
or Renewal Terms, if any, of this Lease, at Lessee's own expense,
public liability insurance with respect to Lessee's use and
occupancy of said premises, including "Dram Shop" or liquor
liability insurance, if the same shall be or become available in
the State of Ohio, with initial limits of at least $2,000,000 per
occurrence/$5,000,000 general aggregate (inclusive of umbrella
coverage), or such additional amounts as Lessor shall reasonably
require from time to time.
(C) Lessee agrees to notify Lessor in writing if Lessee is
unable to procure all or some part of the aforesaid insurance.
In the event Lessee fails to provide all insurance required under
this Lease, Lessor shall have the right, but not the obligation,
to procure such insurance on Lessee's behalf, following five (5)
business days written notice to Lessee of Lessor's intent to do
so (unless insurance then in place would during such period, or
already has, lapsed, in which case no notice need be given) and
Lessee may obtain such insurance during said five day period and
not then be in default hereunder. If Lessor shall obtain such
insurance, Lessee will then, within five (5) business days from
receiving written notice, pay Lessor the amount of the premiums
due or paid, together with interest thereon at the lesser of 15%
per annum or the highest rate allowable by law, which amount
shall be considered Rent payable by Lessee in addition to the
Rent defined at Article 4 hereof.
(D) All policies of insurance provided for or contemplated
by this Article can be under Lessee's blanket insurance coverage
and shall name Lessor, Lessor's corporate general partner, and
Xxxxxx X. Xxxxxxx, individual general partner, and Lessee as
additional insured and loss payee, as their respective interests
(as landlord and lessee, respectively) may appear, and shall
provide that the policies cannot be canceled, terminated,
changed, or modified without thirty (30) days written notice to
the parties. In addition, all of such policies shall be in place
on or before the Occupancy Date and contain endorsements by the
respective insurance companies waiving all rights of subrogation,
if any, against Lessor. All insurance companies providing
coverages must be rated "A" or better by Best's Key Rating Guide
(the most current edition), or similar quality under a successor
guide if Best's Key Rating shall cease to be published. Lessee
shall maintain legible copies of any and all policies and
endorsements required herein, to be made available for Lessor's
review and photocopy upon Lessor's reasonable request from time
to time. On the Occupancy Date and no less than fifteen (15)
business days prior to expiration of such policies, Lessee shall
provide Lessor with legible copies of any and all renewal
Certificates of Insurance reflecting the above terms of the
Policies (including endorsements). Lessee agrees that it will
not settle any property insurance claims affecting the Leased
Premises in excess of $25,000 without Lessor's prior written
consent, such consent not to be unreasonably withheld or delayed.
Lessor shall consent to any settlement of an insurance claim
wherein Lessee shall confirm in writing with evidence reasonably
satisfactory to Lessor that Lessee has sufficient funds available
to complete the rebuilding of the Premises.
(E) Lessee shall defend, indemnify, and hold Lessor
harmless against any and all claims, damages, and lawsuits
arising after the Occupancy Date of this Lease and any orders,
decrees or judgments which may be entered therein, brought for
damages or alleged damages resulting from any injury to person or
property or from loss of life sustained in or about the Leased
Premises, unless such damage or injury results from the
intentional misconduct or the gross negligence of Lessor and
Lessee agrees to save Lessor harmless from, and indemnify Lessor
against, any and all injury, loss, or damage, of whatever nature,
to any person or property caused by, or resulting from any act,
omission, or negligence of Lessee or any employee or agent of
Lessee. In addition, Lessee hereby releases Lessor from any and
all liability for any loss or damage caused by fire or any of the
extended coverage casualties, unless such fire or other casualty
shall be brought about by the intentional misconduct or
negligence of Lessor. In the event of any loss, damage, or
injury caused by the joint negligence or willful misconduct of
Lessor and Lessee, they shall be liable therefor in accordance
with their respective degrees of fault.
(F) Lessor hereby waives any and all rights that it may
have to recover from Lessee damages for any loss occurring to the
Leased Premises by reason of any act or omission of Lessee;
provided, however, that this waiver is limited to those losses
for which Lessor is compensated by its insurers, if the insurance
required by this Lease is maintained. Lessee hereby waives any
and all right that it may have to recover from Lessor damages for
any loss occurring to the Leased Premises by reason of any act or
omission of Lessor; provided, however, that this waiver is
limited to those losses for which Lessee is, or should be if the
insurance required herein is maintained, compensated by its
insurers.
ARTICLE 6. TAXES, ASSESSMENTS AND UTILITIES
(A) Lessee shall be liable and agrees to pay the charges
for all public utility services rendered or furnished to the
Leased Premises, including heat, water, gas, electricity, sewer,
sewage treatment facilities and the like, all personal property
taxes, real estate taxes, special assessments, and municipal or
government charges, general, ordinary and extraordinary, of every
kind and nature whatsoever, which may be levied, imposed, or
assessed against the Leased Premises, or upon any improvements
thereon, at any time after the Occupancy Date of this Lease for
the period prior to the expiration of the term hereof, or any
Renewal Term, if exercised.
(B) Lessee shall pay all real estate taxes, assessments for
public improvements or benefits, and other governmental
impositions, duties, and charges of every kind and nature
whatsoever which shall or may, during the term of this Lease, be
charged, laid, levied, assessed, or imposed upon, or become a
lien or liens upon the Leased Premises or any part thereof. Such
payments shall be considered as Rent paid by Lessee in addition
to the Rent defined at Article 4 hereof. If due to a change in
the method of taxation, a franchise tax, Rent tax, or income or
profit tax shall be levied against Lessor in substitution for or
in lieu of any tax which would otherwise constitute a real estate
tax, such tax shall be deemed a real estate tax for the purposes
herein and shall be paid by Lessee; otherwise Lessee shall not be
liable for any such tax levied against Lessor.
(C) All real estate taxes, assessments for public
improvements or benefits, water rates and charges, sewer rents,
and other governmental impositions, duties, and charges which
shall become payable for the first and last tax years of the term
hereof shall be apportioned pro rata between Lessor and Lessee in
accordance with the respective number of months during which each
party shall be in possession of the Leased Premises (or through
the expiration of the term hereof, if longer) in said respective
tax years. Lessee shall pay within 60 days of the expiration of
the term hereof Lessor's reasonable estimate of Lessee's pro-rata
share of real estate taxes for the last tax year of the term
hereof, based upon the last available tax xxxx. Lessor shall
give Lessee notice of such estimated pro-rata real estate taxes
no later than 75 days from the end of the term hereof. Upon
receipt of the actual statement of real estate taxes for such
prorated period, Lessor shall either refund to Lessee any over
payment of the pro-rata Lessee obligation, or shall assess and
Lessee shall pay promptly upon notice any remaining portion of
the Lessee's pro-rata obligation for such real estate taxes.
(D) Lessee shall have the right to contest or review by
legal proceedings or in such other manner as may be legal (which,
if instituted, shall be conducted solely at Lessee's own expense)
any tax, assessment for public improvements or benefits, or other
governmental imposition aforementioned, upon condition that,
before instituting such proceeding Lessee shall pay (under
protest) such tax or assessments for public improvements or
benefits, or other governmental imposition, duties and charges
aforementioned, unless such payment would act as a bar to such
contest or interfere materially with the prosecution thereof and
in such event Lessee shall post with Lessor alternative security
reasonably satisfactory to Lessor. All such proceedings shall be
begun as soon as reasonably possible after the imposition or
assessment of any contested items and shall be prosecuted to
final adjudication with reasonable dispatch. In the event of any
reduction, cancellation, or discharge, Lessee shall pay the
amount that shall be finally levied or assessed against the
Leased Premises or adjudicated to be due and payable, and, if
there shall be any refund payable by the governmental authority
with respect thereto, if Lessee has paid the expense of Lessor in
such proceedings, Lessee shall be entitled to receive and retain
the refund, subject, however, to apportionment as provided during
the first and last years of the term of this Lease.
(E) Lessor, within sixty (60) days after notice to Lessee
if Lessee fails to commence such proceedings, may, but shall not
be obligated to, contest or review by legal proceedings, or in
such other manner as may be legal, and at Lessor's own expense,
any tax, assessments for public improvements and benefits, or
other governmental imposition aforementioned, which shall not be
contested or reviewed, as aforesaid, by Lessee, and unless Lessee
shall promptly join with Lessor in such contest or review, Lessor
shall be entitled to receive and retain any refund payable by the
governmental authority with respect thereto.
(F) Lessor shall not be required to join in any proceeding
referred to in this Article, unless in Lessee's reasonable
opinion, the provisions of any law, rule, or regulation at the
time in effect shall require that such a proceeding be brought by
and/or in the name of Lessor, in which event Lessor shall upon
written request, join in such proceedings or permit the same to
be brought in its name, all at no cost or expense to Lessor.
(G) Within thirty (30) days after Lessor notifies Lessee in
writing that Lessor has paid such amount, Lessee shall also pay
to Lessor, as additional Rent, the amount of any sales tax,
franchise tax, excise tax, on Rents imposed by the State where
the Leased Premises are located. At Lessor's option, Lessee
shall deposit with Lessor on the first day of each and every
month during the term hereof, an amount equal to one-twelfth
(1/12) of any estimated sales tax payable to the State in which
the property is situated for Rent received by Lessor hereunder
("Deposit"). From time to time out of such Deposit Lessor will
pay the sales tax to the State in which the property is situated
as required by law. In the event the Deposit on hand shall not
be sufficient to pay said tax when the same shall become due from
time to time, or the prior payments shall be less than the
current estimated monthly amounts, then Lessee shall pay to
Lessor on demand any amount necessary to make up the deficiency.
The excess of any such Deposit shall be credited to subsequent
payments to be made for such items. If a default or an event of
default shall occur under the terms of this Lease, Lessor may, at
its option, without being required so to do, apply any Deposit on
hand to cure such default, in such order and manner as Lessor may
elect.
ARTICLE 7. PROHIBITION ON ASSIGNMENTS AND SUBLETTING; TAKE-
BACK
RIGHTS
(A) Except as otherwise expressly provided in this Article,
Lessee shall not, without obtaining the prior written consent of
Lessor, in each instance:
1. assign or otherwise transfer this Lease,
or any part of Lessee's right, title or interest
therein, except in the event the Lease is assigned
by Tumbleweed to its successor entity in the event
of either an Initial Public Offering or Direct
Public Offering of Lessee; or
2. sublet all or any part of the Leased
Premises or allow all or any part of the Leased
Premises to be used or occupied by any other
Persons (herein defined as a Party other than
Lessee, be it a corporation, a partnership, an
individual or other entity); or
3. mortgage, pledge or otherwise encumber
this Lease, or the Leased Premises.
(B) For the purposes of this Article:
1. the transfer of voting control of any
class of capital stock of any corporate Lessee or
sublessee, or the transfer voting control of the
total interest in any other person which is a
Lessee or sublessee, however accomplished, whether
in a single transaction or in a series of related
or unrelated transactions, shall be deemed an
assignment of this Lease, or of such sublease, as
the case may be;
2. an agreement by any other Person,
directly or indirectly, to assume Lessee's
obligations under this Lease shall be deemed an
assignment;
3. any Person to whom Lessee's interest
under this Lease passes by operation of law, or
otherwise, shall be bound by the provisions of
this Article;
4. each material modification, amendment or
extension or any sublease to which Lessor has
previously consented shall be deemed a new
sublease; and
Lessee agrees to furnish to Lessor within five (5) business
days following demand at any time such information and assurances
as Lessor may reasonably request that neither Lessee, nor any
previously permitted sublessee or assignee, has violated the
provisions of this Article.
(C) If Lessee agrees to assign this Lease or to sublet all
or any portion of the Leased Premises, Lessee shall, prior to the
effective date thereof (the "Effective Date"), deliver to Lessor
executed counterparts of any such agreement and of all ancillary
agreements with the proposed assignee or sublessee, as
applicable. If Lessee shall fail to do so, and shall have
surrendered possession of the Leased Premises in violation of its
duty of prior notice and failed to obtain Lessor's prior consent
(if and where required herein), and, if in such event, Lessor in
its sole discretion (except as otherwise specifically limited
herein) shall not consent to a proposed sublease or assignment,
Lessor shall then have all of the following rights (in addition
to any rights Lessor may possess occasioned by Lessee's default
hereunder), any of which Lessor may exercise by written notice to
Lessee given within thirty (30) days after Lessor receives the
aforementioned documents:
1. with respect to a proposed assignment of
this Lease, the right to terminate this Lease on
the Effective Date as if it were the Expiration
Date of this Lease;
2. with respect to a proposed subletting of
the entire Leased Premises, the right to terminate
this Lease on the Effective Date as if it were the
Expiration Date; or
3. with respect to a proposed subletting of
less than the entire Leased Premises, the right to
terminate this Lease as to the portion of the
Leased Premises affected by such subletting on the
Effective Date, as if it were the Expiration Date,
in which case Lessee shall promptly execute and
deliver to Lessor an appropriate modification of
this Lease in form satisfactory to Lessor in all
respects.
4. with respect to a proposed subletting or
proposed assignment of this Lease, impose such
conditions upon Lessor's consent as Lessor shall
determine in its sole discretion.
(D) If Lessor exercises any of its options under Article
7(C) above, (and if Lessor shall impose conditions upon its
consent and Lessee shall fail to meet any conditions Lessor may
impose upon its consent), Lessor may then lease the Leased
Premises or any portion thereof to Lessee's proposed assignee or
sublessee, as the case may be, without liability whatsoever to
Lessee.
(E) Notwithstanding anything above to the contrary, Lessor
agrees to consent to any assignment or sublease all or any
portion of the Lessee's interests herein to a franchisee or
licensee in good standing of Tumbleweed, LLC, for the Tumbleweed
restaurant concept, provided Lessor is given prior written notice
of such sublease or assignment, accompanied by a copy of such
sublease or assignment, and the consents of Lessee (such consent
to be in form and substance satisfactory to Lessor) to such
assignment or sublet, affirming their continued liability
hereunder.
Lessor agrees that its consent to any other proposed
assignment or sublet shall not be unreasonably withheld or
delayed, provided Lessor is given prior written notice of such
sublease or assignment, accompanied by a copy of such sublease or
assignment, and the consents of Lessee (such consent to be in
form and substance satisfactory to Lessor) to such assignment or
sublet, affirming their continued liability hereunder.
(F) Notwithstanding anything above to the contrary, the
Lessee's interest herein shall not be assignable in any manner in
accordance with the terms hereof unless and until the termination
of the Development Financing Agreement as set forth in Article 35
hereof.
ARTICLE 8. REPAIRS AND MAINTENANCE
(A) Lessee covenants and agrees to keep and maintain in
good order, condition and repair the interior and exterior of the
Leased Premises during the term of the Lease, or any renewal
terms, and further agrees that Lessor shall be under no
obligation to make any repairs or perform any maintenance to the
Leased Premises. Lessee covenants and agrees that it shall be
responsible for all repairs, alterations, replacements, or
maintenance of, including but without limitation to or of: The
interior and exterior portions of all doors; door checks and
operators; windows; plate glass; plumbing; water and sewage
facilities; fixtures; electrical equipment; interior walls;
ceilings; signs; roof; structure; interior building appliances
and similar equipment; heating and air conditioning equipment;
and any equipment owned by Lessor and leased to Lessee hereunder,
as itemized on Exhibit B attached hereto (if any) and
incorporated herein by reference; and further agrees to replace
any of said equipment when necessary. Lessee further agrees to
be responsible for, at its own expense, snow removal, lawn
maintenance, landscaping, maintenance of the parking lot
(including parking lines, seal coating, and blacktop surfacing),
and other similar items.
(B) If Lessee refuses or neglects to commence or complete
repairs promptly and adequately, after prior written notice as
required under Article 16(B) (except in cases of emergency to
prevent waste or preserve the safety and integrity of the Leased
Premises, in which case no notice need be given), Lessor may
cause such repairs to be made, but shall not be required to do
so, and Lessee shall pay the cost thereof to Lessor within five
(5) business days following demand. It is understood that Lessee
shall pay all expenses and maintenance and repair during the term
of this Lease. If Lessee is not then in default hereunder,
Lessee shall have the right to make repairs and improvements to
the Leased Premises without the consent of Lessor if such repairs
and improvements do not exceed Fifty Thousand Dollars
($50,000.00), provided such repairs or improvements do not affect
the structural integrity of the Leased Premises. Any repairs or
improvements in excess of Fifty Thousand Dollars ($50,000.00) or
affecting the structural integrity of the Leased Premises may be
done only with the prior written consent of Lessor, such consent
not to be unreasonably withheld or delayed. All alterations and
additions to the Leased Premises shall be made in accordance with
all applicable laws and shall remain for the benefit of Lessor,
except for Lessee's moveable trade fixtures. In the event of
making such alterations as herein provided, Lessee further agrees
to indemnify and save harmless Lessor from all expense, liens,
claims or damages to either persons or property or the Leased
Premises which may arise out of or result from the undertaking or
making of said repairs, improvements, alterations or additions,
or Lessee's failure to make said repairs, improvements,
alterations or additions.
ARTICLE 9. COMPLIANCE WITH LAWS AND REGULATIONS
Lessee will comply with all statutes, ordinances, rules,
orders, regulations and requirements of all federal, state, city
and local governments, and with all rules, orders and
regulations of the applicable Board of Fire Underwriters which
affect the use of the improvements. Lessee will comply with all
easements, restrictions, and covenants of record against or
affecting the Leased Premises and any franchise or license
agreements required for operation of the Leased Premises in
accordance with Article 14 hereof.
ARTICLE 10. SIGNS
Lessee shall have the right to install and maintain a sign
or signs advertising Lessee's business, provided that the signs
conform to law, and further provided that the sign or signs
conform specifically to the written requirements of the
appropriate governmental authorities.
ARTICLE 11. SUBORDINATION
(A) Lessor reserves the right and privilege to subject and
subordinate this Lease at all times to the lien of any mortgage
or mortgages now or hereafter placed upon Lessor's interest in
the Leased Premises and on the land and buildings of which said
premises are a part, or upon any buildings hereafter placed upon
the land of which the Leased Premises are a part, provided such
mortgagee shall execute its standard form, commercially
reasonable subordination, attornment and non-disturbance
agreement. Lessor also reserves the right and privilege to
subject and subordinate this Lease at all times to any and all
advances to be made under such mortgages, and all renewals,
modifications, extensions, consolidations, and replacements
thereof, provided such mortgagee shall execute its standard form,
commercially reasonable subordination, attornment and non-
disturbance agreement.
(B) Lessee covenants and agrees to execute and deliver,
upon demand, such further instrument or instruments subordinating
this Lease on the foregoing basis to the lien of any such
mortgage or mortgages as shall be desired by Lessor and any
proposed mortgagee or proposed mortgagees, provided such
mortgagee shall execute its standard form, commercially
reasonable subordination, attornment and non-disturbance
agreement.
ARTICLE l2. CONDEMNATION OR EMINENT DOMAIN
(A) If the whole of the Leased Premises are taken by any
public authority under the power of eminent domain, or by private
purchase in lieu thereof, then this Lease shall automatically
terminate upon the date possession is surrendered, and Rent shall
be paid up to that day. If any part of the Leased Premises shall
be so taken as to render the remainder thereof materially
unusable in the opinion of a licensed third party arbitrator
reasonably approved by Lessor and Lessee, for the purposes for
which the Leased Premises were leased, then Lessor and Lessee
shall each have the right to terminate this Lease on thirty (30)
days notice to the other given within ninety (90) days after the
date of such taking. In the event that this Lease shall
terminate or be terminated, the Rent shall, if and as necessary,
be paid up to the day that possession was surrendered.
(B) If any part of the Leased Premises shall be so taken
such that it does not materially interfere with the business of
Lessee, then Lessee shall, with the use of the condemnation
proceeds to be made available by Lessor, but otherwise at
Lessee's own cost and expense, restore the remaining portion of
the Leased Premises to the extent necessary to render it
reasonably suitable for the purposes for which it was leased.
Lessee shall make all repairs to the building in which the Leased
Premises is located to the extent necessary to constitute the
building a complete architectural unit. Provided, however, that
such work shall not exceed the scope of the work required to be
done by Lessee in originally constructing such building unless
Lessee shall demonstrate to Lessor's reasonable satisfaction the
availability of funds to complete such work. Provided, further,
the cost thereof to Lessor shall not exceed the proceeds of its
condemnation award, all to be done without any adjustments in
Rent to be paid by Lessee. This lease shall be deemed amended to
reflect the taking in the legal description of the Leased
Premises.
(C) All compensation awarded or paid upon such total or
partial taking of the Leased Premises shall belong to and be the
property of Lessor without any participation by Lessee, whether
such damages shall be awarded as compensation for diminution in
value to the leasehold or to the fee of the premises herein
leased. Nothing contained herein shall be construed to preclude
Lessee from prosecuting any claim directly against the condemning
authority in such proceedings for: Loss of business; damage to
or loss of value or cost of removal of inventory, trade fixtures,
furniture, and other personal property belonging to Lessee;
provided, however, that no such claim shall diminish or otherwise
adversely affect Lessor's award or the award of any fee
mortgagee.
ARTICLE 13. RIGHT TO INSPECT
Lessor reserves the right to enter upon, inspect and examine
the Leased Premises at any time during business hours, after
reasonable notice to Lessee, and Lessee agrees to allow Lessor
free access to the Leased Premises to show the premises. Upon
default by Lessee or at any time within ninety (90) days of the
expiration or termination of the Lease, Lessee agrees to allow
Lessor to then place "For Sale" or "For Rent" signs on the Leased
Premises. Lessor and Lessor's representatives shall at all times
while upon or about the Leased Premises observe and comply with
Lessee's reasonable health and safety rules, regulations,
policies and procedures. Lessor agrees to indemnify and hold
Lessee, its successors, assigns, agents and employees from and
against any liability, claims, demands, cause of action, suits
and other litigation or judgements of every kind and character,
including injury to or death of any person or persons, or
trespass to, or damage to, or loss or destruction of, any
property, whether real or personal, to the extent resulting from
the negligence or willful misconduct or Lessor or Lessor's
representatives while upon or about the Leased Premises.
ARTICLE 14. EXCLUSIVE USE
(A) After the Occupancy Date, Lessee expressly agrees and
warrants that the Leased Premises will be used exclusively as a
Tumbleweed Restaurant or other casual dining sit-down restaurant.
In any other such case, after obtaining Lessor's prior written
consent, such consent not to be unreasonably withheld or delayed,
Lessee may conduct any lawful business from the Leased Premises.
Lessee acknowledges and agrees that any other use without the
prior written consent of Lessor will constitute a default under
and a violation and breach of this Lease. Lessee agrees: To
open for business within a reasonable period of time after
completion of construction of the contemplated Improvements; to
operate all of the Leased Premises during the Term or Renewal
Terms during regular and customary hours for businesses similar
to the permitted exclusive use stated herein, unless prevented
from doing so by causes beyond Lessee's control or due to
remodeling; and to conduct its business in a professional and
reputable manner.
(B) If the Leased Premises are not operated as a Tumbleweed
Restaurant or other casual dining sit-down restaurant or other
permitted use hereunder, or remain closed for thirty (30)
consecutive days (unless such closure results from reasons beyond
Lessee's reasonable control) and in the event Lessee fails to pay
Rent when due or fulfill any other obligation hereunder, then
Lessee shall be in default hereunder and Lessor may, at its
option, cancel this Lease by giving written notice to Lessee or
exercise any other right or remedy that Lessor may have;
provided, however, that closings shall be reasonably permitted
for replacement of trade fixtures or during periods of repair
after destruction or due to remodeling.
ARTICLE 15. DESTRUCTION OF PREMISES
If, during the term of this Lease, the Leased Premises are
totally or partially destroyed by fire or other elements, within
a reasonable time (but in no event longer than one hundred eighty
(180) days and subject to the provisions herein below), Lessee
shall repair and restore the improvements so damaged or destroyed
as nearly as may be practical to their condition immediately
prior to such casualty. All rents payable by Lessee shall be
abated during the period of repair and restoration to the extent
that Lessor shall be compensated by the proceeds of the rent loss
insurance required to be maintained by Lessee hereunder.
Provided Lessee is not in default hereunder (and retains
according to the terms hereof the right to rebuild) with the
Lessor's prior written consent, which consent shall not be
unreasonably withheld or delayed, Lessee shall have the right to
promptly and in good xxxxx xxxxxx and adjust any claim under such
insurance policies with the insurance company or companies on the
amounts to be paid upon the loss. The insurance proceeds shall
be used to reimburse Lessee for the cost of rebuilding or
restoration of the Leased Premises. Risk that the insurance
company shall be insolvent or shall refuse to make insurance
proceeds available shall be with Lessee. The Leased Premises
shall be so restored or rebuilt so as to be of at least equal
value and substantially the same character as prior to such
damage or destruction. If the insurance proceeds are less than
Fifty Thousand Dollars ($50,000), they shall be paid to Lessee
for such repair and restoration. If the insurance proceeds are
greater than or equal to Fifty Thousand Dollars ($50,000), they
shall be deposited by Lessee and Lessor into a customary
construction escrow at a nationally recognized title insurance
company, or at Lessee's option, with Lessor ("Escrowee") and
shall be made available from time to time to Lessee for such
repair and restoration. Such proceeds shall be disbursed in
conformity with the terms and conditions of a commercially
reasonable construction loan agreement. Lessee shall, in either
instance, deliver to Lessor or Escrowee (as the case may be)
satisfactory evidence of the estimated cost of completion
together with such architect's certificates, waivers of lien,
contractor's sworn statements and other evidence of cost and of
payments as the Lessor or Escrowee may reasonably require and
approve. If the estimated cost of the work exceeds One Hundred
Thousand Dollars ($100,000), all plans and specifications for
such rebuilding or restoration shall be subject to the reasonable
approval of Lessor.
Any insurance proceeds remaining with Escrowee after the
completion of the repair or restoration shall be paid to Lessor
to reduce the sum of monies expended by Lessor to acquire its
interest in the Lease Premises and rent hereunder shall be
reduced by 10.25% of such amount.
If the proceeds from the insurance are insufficient, after
review of the bids for completion of such improvements, or should
become insufficient during the course of construction, to pay for
the total cost of repair or restoration, Lessee shall, prior to
commencement of work, demonstrate to Escrowee and Lessor's
reasonable satisfaction, the availability of such funds necessary
to completion construction and Lessee shall deposit the same with
Escrowee for disbursement under the construction escrow
agreement.
Provided, further, that should the Leased Premises be
damaged or destroyed to the extent of fifty (50%) percent of its
value or such that Lessee cannot carry on business as a casual
dining restaurant without (in the opinion of a licensed third
party architect reasonably approved by Lessor and Lessee) being
closed for more than sixty (60) days (which duration of closure
may be established by Lessee by the affidavit of the approved
independent third party architect as to the estimated time of
repair) during the last two (2) years of the remaining term of
this Lease or any of the option terms of this Lease, if any
further options to renew remain, Lessee may elect within 30 days
of such damage, to then exercise at least one (1) option to renew
this Lease so that the remaining term of the Lease is not less
than five (5) years in order to be entitled to such insurance
proceeds for restoration or rebuilding. Absent such election,
this Lease shall terminate upon Lessor's receipt of funds at
least equal to the estimated cost of such repair or restoration.
ARTICLE 16. ACTS OF DEFAULT
Each of the following shall be deemed a default by Lessee
and a breach of this Lease:
(A) Failure to pay the Rent or any monetary
obligation herein reserved, or any part thereof
when the same shall be due and payable. Interest
and late charges for failure to pay Rent when due
shall accrue from the first date such Rent was due
and payable; provided, however, Lessee shall have
five (5) business days after written notice from
Lessor within which to cure the failure to pay the
Rent or any monetary obligation herein reserved.
(B) Failure to do, observe, keep and perform
any of the other terms, covenants, conditions,
agreements and provisions in this Lease to be
done, observed, kept and performed by Lessee;
provided, however, that Lessee shall have Thirty
(30) days after written notice from Lessor within
which to cure such default, or such longer time as
may be reasonably necessary if such default cannot
reasonably be cured within Thirty (30) days, if
Lessee is diligently pursuing a course of conduct
that in Lessor's reasonable opinion is capable of
curing such default, but in any event such longer
time shall not exceed 120 days after written
notice from Lessor of the default hereunder.
(C) The abandonment of the premises by
Lessee, the adjudication of Lessee as a bankrupt,
the making by Lessee of a general assignment for
the benefit of creditors, the taking by Lessee of
the benefit of any insolvency act or law, the
appointment of a permanent receiver or trustee in
bankruptcy for Lessee property, or the appointment
of a temporary receiver which is not vacated or
set aside within sixty (60) days from the date of
such appointment; provided, however, that the
foregoing shall not constitute events of default
so long as Lessee continues to otherwise satisfy
its obligations (including but not limited to the
payment of Rent) hereunder.
ARTICLE 17. TERMINATION FOR DEFAULT
In the event of any uncured default by Lessee and at any
time thereafter, Lessor may serve a written notice upon Lessee
that Lessor elects to terminate this Lease. This Lease shall
then terminate on the date so specified as if that date had been
originally fixed as the expiration date of the term herein
granted, provided, however, that Lessee shall have continuing
liability for future rents for the remainder of the original term
and any exercised renewal term as set forth in Article 19,
notwithstanding any earlier termination of the Lease hereunder
(except where Lessee has exercised a right to terminate where
granted herein), preserving unto Lessor the benefit of its
bargained-for rental payments.
ARTICLE 18. LESSOR'S RIGHT OF RE-ENTRY
In the event that this Lease shall be terminated as
hereinbefore provided, or by summary proceedings or otherwise, or
in the event of an uncured default hereunder by Lessee, or in the
event that the premises or any part thereof, shall be abandoned
by Lessee and Rent shall not be paid or other obligations
(including but not limited to repair and maintenance obligations)
of Lessee hereunder shall not be met, then Lessor or its agents,
servants or representatives, may immediately or at any time
thereafter, re-enter and resume possession of the premises or any
part thereof, and remove all persons and property therefrom,
either by summary dispossess proceedings or by a suitable action
or proceeding at law, or by force or otherwise without being
liable for any damages therefor, except for damages resulting
from Lessor's negligence or willful misconduct. Notwithstanding
anything above to the contrary, if Lessee is still in possession
of the Leased Premises, Lessor agrees to use such legal
proceedings (summary or otherwise) prescribed by law to regain
possession of the Leased Premises.
ARTICLE 19. LESSEE'S CONTINUING LIABILITY
(A) Should Lessor elect to re-enter as provided in this
Lease or should it take possession pursuant to legal proceedings
or pursuant to any notice provided for by law, Lessor shall
undertake commercially reasonable efforts to mitigate Lessee's
continuing liability hereunder as such efforts may be prescribed
by law or statute (which shall include listing the Leased
Premises with a licensed commercial real estate broker and
securing the property against waste, but shall not otherwise
include the expenditure of Lessor's funds, unless the same be
required by law or statute and cannot be waived as provided for
herein), and in addition, Lessor may either (i) terminate this
Lease or (ii) it may from time to time, without terminating the
contractual obligation of Lessee to pay Rent under this Lease,
make such alterations and repairs as may be necessary to relet
the Leased Premises or any part thereof for the remainder of the
original Term or any exercised Renewal Terms, at such Rent or
Rents, and upon such other terms and conditions as Lessor in its
sole discretion may deem advisable. Termination of Lessee's
right to possession by Court Order shall be sufficient evidence
of the termination of Lessee's possessory rights under this
Lease, and the filing of such an Order shall be notice of the
termination of Lessee's renewal rights as set forth in any
Memorandum of Lease of record.
(B) Upon each such reletting, without termination of the
contractual obligation of Lessee to pay Rent under this Lease,
all Rents received by Lessor shall be applied as follows:
1. First, to the payment of any
indebtedness other than Rent due hereunder from
Lessee to Lessor;
2. Second, to the payment of any costs and
expenses of such reletting, including brokerage
fees and attorney's fees and of costs of such
alterations and repairs;
3. Third, to the payment of Rent and other
monetary obligations due and unpaid hereunder;
4. Finally, the residue, if any, shall be
held by Lessor and applied in payment of future
Rent as the same may become due and payable
hereunder.
If such Rents received from such reletting during any month are
less than that to be paid during that month by Lessee hereunder,
Lessee shall pay any such deficiency to Lessor. Such deficiency
shall be calculated and paid monthly. No such re-entry or taking
possession of such Leased Premises by Lessor shall be construed
as an election on its part to terminate Lessee's contractual
obligations under this Lease respecting the payment of rent and
obligations for the costs of repair and maintenance unless a
written notice of such intention be given to Lessee.
(C) Notwithstanding any such reletting without termination,
Lessor may at any time thereafter elect to terminate this Lease
for any uncured breach.
(D) In addition to any other remedies Lessor may have with
this Article 19, Lessor may recover from Lessee all damages it
may incur by reason of any uncured breach, including: The cost
of recovering and reletting the Leased Premises; reasonable
attorney's fees; and, the present value (discounted at a rate of
8% per annum) of the excess of the amount of Rent and charges
equivalent to Rent reserved in this Lease for the remainder of
the Term over the then reasonable Rent value of the Leased
Premises (or the actual Rents receivable by Lessor, if relet),
(the Lessee bearing the burden of proof to demonstrate the amount
of rental loss for the same period, that through reasonable
efforts to mitigate damages, could have been avoided) for the
remainder of the Term, all of which amounts shall be immediately
due and payable from Lessee to Lessor in full. In the event that
the Rent obtained from such alternative or substitute tenant is
more than the Rent which Lessee is obligated to pay under this
Lease, then such excess shall be paid to Lessor provided that
Lessor shall credit such excess against the outstanding
obligations of Lessee due pursuant hereto, if any.
(E) It is the object and purpose of this Article 19 that
Lessor shall be kept whole and shall suffer no damage by way of
non-payment of Rent or by way of diminution in Rent. Lessee
waives and will waive all rights to trial by jury in any summary
proceedings or in any action brought to recover Rent herein which
may hereafter be instituted by Lessor against Lessee in respect
to the Leased Premises. Lessee hereby waives any rights of re-
entry it may have or any rights of redemption or rights to redeem
this Lease upon a termination of this Lease.
ARTICLE 20. PERSONALTY, FIXTURES AND EQUIPMENT
(A) All building fixtures, building machinery, and building
equipment used in connection with the operation of the Leased
Premises including, but not limited to, heating, electrical
wiring, lighting, ventilating, plumbing, walk-in
refrigerators/coolers, walk-in freezers, air conditioning
systems, and the equipment owned by Lessor and leased to Lessee
hereunder as specifically set forth on Exhibit B attached hereto,
if any, and incorporated herein by reference shall be the
property of Lessor. All other trade fixtures and all other
articles of personal property owned by Lessee shall remain the
property of Lessee.
(B) Lessee shall furnish and pay for any and all equipment,
furniture, trade fixtures, and signs, except for such items, if
any, described in Article 20(A) above, as owned by Lessor.
Lessee agrees that Lessor shall have a lien on all Lessee's
equipment, furniture, trade fixtures, furnishings, and signs as
security for the performance of and compliance with this Lease,
subject to the rights of any bona fide third party's security
interest in such property. Provided Lessee is not in default
hereunder, Lessor will agree that its interest in the personal
property of Lessee will be subordinated to financing which may
exist or which Lessee may cause to exist in the future on that
same personal property.
(C) At the end of the term of this Lease, the property
described at Article 20(B) above, after written notice to Lessor
given at least ten (10) business days prior to any proposed
removal, may be removed from the Leased Premises by Lessee
regardless of whether or not such property is attached to the
Leased Premises so as to constitute a "fixture" within the
meaning of the law; however, all damages and repairs to the
Leased Premises which may be caused by the removal of such
property shall be paid for by Lessee.
ARTICLE 21. LIENS
Lessee shall not do or cause anything to be done whereby the
Leased Premises may be encumbered by any mechanic's or other
liens. Whenever and as often as any mechanic's or other lien is
filed against said Leased Premises purporting to be for labor or
materials furnished or to be furnished to Lessee, Lessee shall
remove the lien of record by payment or by bonding with a surety
company authorized to do business in the state in which the
property is located, within forty-five (45) days from the date of
the filing of said mechanic's or other lien and delivery of
notice thereof to Lessee. Should Lessee fail to take the
foregoing steps within said forty-five (45) day period (or in any
event, prior to the expiration of the time within which Lessee
may bond over such lien to remove it as a lien upon the Leased
Premises), Lessor shall have the right, among other things, to
pay said lien without inquiring into the validity thereof, and
Lessee shall forthwith reimburse Lessor for the total expense
incurred by it in discharging said lien as additional Rent
hereunder.
ARTICLE 22. NO WAIVER BY LESSOR EXCEPT IN WRITING
No agreement to accept a surrender of the Leased Premises or
termination of this Lease shall be valid unless in writing signed
by Lessor. The delivery of keys to any employee of Lessor or
Lessor's agents shall not operate as a termination of the Lease
or a surrender of the premises. The failure of Lessor to seek
redress for violation of any rule or regulation, shall not
prevent a subsequent act, which would have originally constituted
a violation, from having all the force and effect of an original
violation. Neither payment by Lessee or receipt by Lessor of a
lesser amount than the Rent herein stipulated shall be deemed to
be other than on account of the earliest stipulated Rent. Nor
shall any endorsement or statement on any check nor any letter
accompanying any check or payment as Rent be deemed an accord and
satisfaction. Lessor may accept such check or payment without
prejudice to Lessor's right to recover the balance of such Rent
or pursue any other remedy provided in this Lease. This Lease
contains the entire agreement between the parties, and any
executory agreement hereafter made shall be ineffective to change
it, modify it or discharge it, in whole or in part, unless such
executory agreement is in writing and signed by the party against
whom enforcement of the change, modification or discharge is
sought.
ARTICLE 23. QUIET ENJOYMENT
Lessor covenants that Lessee, upon paying the Rent set forth
in Article 4 and all other sums herein reserved as Rent and upon
the due performance of all the terms, covenants, conditions and
agreements herein contained on Lessee's part to be kept and
performed, shall have, hold and enjoy the Leased Premises free
from molestation, eviction, or disturbance by Lessor, or by any
other person or persons lawfully claiming the same, and that
Lessor has good right to make this Lease for the full term
granted, including renewal periods.
ARTICLE 24. BREACH - PAYMENT OF COSTS AND ATTORNEYS' FEES
Each party agrees to pay and discharge all reasonable costs,
and actual attorneys' fees, including but not limited to
attorney's fees incurred at the trial level and in any appellate
or bankruptcy proceeding, and expenses that shall be incurred by
the prevailing party in enforcing the covenants, conditions and
terms of this Lease or defending against an alleged breach,
including the costs of reletting. Such costs, attorneys fees,
and expenses if incurred by Lessor shall be considered as Rent as
due and owing in addition to any Rent defined in Article 4
hereof.
ARTICLE 25. ESTOPPEL CERTIFICATES
Either party to this Lease will, at any time, upon not less
than ten (10) business days prior request by the other party,
execute, acknowledge and deliver to the requesting party a
statement in writing, executed by an executive officer of such
party, certifying that: (a) this Lease is unmodified (or if
modified then disclosure of such modification shall be made); (b)
this Lease is in full force and effect; (c) the date to which the
Rent and other charges have been paid; and (d) to the knowledge
of the signer of such certificate that the other party is not in
default in the performance of any covenant, agreement or
condition contained in this Lease, or if a default does exist,
specifying each such default of which the signer may have
knowledge. It is intended that any such statement delivered
pursuant to this Article may be relied upon by any prospective
purchaser or mortgagee of the Leased Premises or any assignee of
such mortgagee or a purchaser of the leasehold estate.
ARTICLE 26. FINANCIAL STATEMENTS
During the term of this Lease, Lessee will, within ninety
(90) days after the end of Lessee's fiscal year, furnish Lessor
with Lessee's financial statements (in SEC Form 10-K, if
available). The financial statements shall be audited, at the
Lessee's expense, by a nationally recognized independent
certified public accounting firm reasonably acceptable to Lessor
and shall be prepared in conformity with generally accepted
accounting principles (GAAP). Lessee shall also provide Lessor
with financial statements for the Leased Premises within 90 days
after the end of each Lease Year. The financial statements for
the Leased Premises do not need to be prepared by an independent
certified public accountant, but shall be certified as true and
correct by the chief financial officer or other authorized
officer of Lessee. Additionally, during the term of the Lease,
Lessee will within forty-five (45) days from the end of each
quarter of each fiscal year, furnish Lessor with Lessee's
financial statements (in SEC Form 10-Q if available)and financial
statements of the Leased Premises for such quarter. Lessor shall
have the right to require such financial statements for the
Lessee and the Leased Premises on a monthly basis after the
occurrence of a default in any Lease Year. Provided, however, if
Lessee shall not commit a default for twelve consecutive months,
Lessor's right to require such monthly financial statements shall
terminate until Lessee shall again commit a default in any given
Lease Year. Said quarterly (or monthly, if required by Lessor)
financial statements do not need to be prepared by an independent
certified public accountant, but shall be certified as true and
correct by the chief financial officer or other authorized
officer of Lessee. The financial statements shall conform to
GAAP, and include a balance sheet and related statements of
operations, statement of cash flows, statement of changes in
shareholder's equity, and related notes to financial statements,
if any.
ARTICLE 27. MORTGAGE
Lessee does hereby agree to make reasonable modifications of
this Lease requested by any Mortgagee of record from time to
time, provided such modifications are not substantial and do not
increase any of the Rents or obligations of Lessee under this
Lease or substantially modify any of the business elements of
this Lease.
ARTICLE 28. OPTION TO RENEW
If this Lease is not previously canceled or terminated and
if Lessee has materially complied with and performed all of the
covenants and conditions in this Lease after applicable cure
periods and is not currently in default, then Lessee shall have
the option to renew this Lease upon the same conditions and
covenants contained in this Lease for Two (2) consecutive
periods of Five (5) years each (singularly "Renewal Term"). Rent
during the Renewal Term shall increase each Lease Year by the
lesser of Two Percent (2%) of the Rent payable for the preceding
Lease Year, or the CPI-U Percentage Increase, as defined in
Article 4 hereof.
The first Renewal Term will commence on the day following
the date the original Term expires and successive Renewal Terms
would commence on the day following the last day of the then
expiring Renewal Term. Except as otherwise provided in Article
15 hereof, Lessee must give ninety (90) days written notice to
Lessor of its intent to exercise this option prior to the
expiration of the original Term of this Lease or any Renewal
Term, as the case may be.
ARTICLE 29. MISCELLANEOUS PROVISIONS
(A) All written notices shall be given to Lessor or Lessee
by certified mail or nationally recognized overnight mail.
Notices to either party shall be addressed to the person and
address given on the first page hereof. Lessor and Lessee may,
from time to time, change these addresses by notifying each other
of this change in writing. Notices of overdue Rent may be sent
to Lessee by regular, special delivery, or nationally recognized
overnight mail.
(B) The terms, conditions and covenants contained in this
Lease and any riders and plans attached hereto shall bind and
inure to the benefit of Lessor and Lessee and their respective
successors, heirs, legal representatives, and assigns.
(C) This Lease shall be governed by and construed under the
laws of the State where the Leased Premises are situate.
(D) In the event that any provision of this Lease shall be
held invalid or unenforceable, no other provisions of this Lease
shall be affected by such holding, and all of the remaining
provisions of this Lease shall continue in full force and effect
pursuant to the terms hereof.
(E) The Article captions are inserted only for convenience
and reference, and are not intended, in any way, to define,
limit, describe the scope, intent, and language of this Lease or
its provisions.
(F) In the event Lessee remains in possession of the
premises herein leased after the expiration of this Lease and
without the execution of a new lease and without Lessor's written
permission, Lessee shall be deemed to be occupying said premises
as a tenant from month-to-month, subject to all the conditions,
provisions, and obligations of this Lease insofar as the same can
be applicable to a month-to-month tenancy except that the monthly
installment of Rent shall be One Hundred Fifty percent (150%) the
amount due on the last month prior to such expiration.
(G) If any installment of Rent (whether lump sum, monthly
installments, or any other monetary amounts required by this
Lease to be paid by Lessee and deemed to constitute Rent
hereunder) shall not be paid when due, or non-monetary default
shall remain uncured after the expiration of any applicable cure
period, Lessor shall have the right to charge Lessee a late
charge of $250.00 per month for each month that any amount of
Rent installment remains unpaid or non-monetary default shall go
uncured after the first such occurrence in any 12 month period.
Said late charge shall commence after such installment is due or
non-monetary default goes uncured after the expiration of any
applicable cure period and continue until said installment,
interest and all accrued late charges are paid in full or such
non-monetary default is cured.
(H) Any part of the Leased Premises may be conveyed by
Lessor for private or public non-exclusive easement purposes at
any time, provided such easement does not interfere with the
access to the Leased Premises, visibility, or operations of the
business of Lessee. In such event Lessor shall, at its own cost
and expense, restore the remaining portion of the Leased Premises
to the extent necessary to render it reasonably suitable for the
purposes for which it was leased, all to be done without
adjustments in Rent to be paid by Lessee. All proceeds from any
conveyance of an easement shall belong solely to Lessor.
(I) For the purpose of this Lease, the term "Rent" shall be
defined as Rent under Article 4, and any other monetary amounts
required by this Lease to be paid by Lessee.
(J) Lessee agrees to cooperate with Lessor to allow Lessor
to obtain and use at Lessor's expense promotional photographs of
the Leased Premises, to the extent permitted by Lessee's
franchisor or licensor.
ARTICLE 30. REMEDIES
NON-EXCLUSIVITY. Notwithstanding anything contained herein
it is the intent of the parties that the rights and remedies
contained herein shall not be exclusive but rather shall be
cumulative along with all of the rights and remedies of the
parties which they may have at law or equity. In the event of a
breach by Lessor, Lessee shall be entitled to all remedies at law
or equity, to be cumulatively enforced.
ARTICLE 31. HAZARDOUS MATERIALS INDEMNITY
Lessee covenants, represents and warrants to Lessor, its
successors and assigns, (i) that it has not used or permitted and
will not use or permit the Leased Premises to be used, whether
directly or through contractors, agents or tenants, and to the
best of Lessee's knowledge and except as disclosed to Lessor in
writing, the Leased Premises has not at any time been used for
the generating, transporting, treating, storage, manufacture,
emission of, or disposal of any dangerous, toxic or hazardous
pollutants, chemicals, wastes or substances as defined in the
Federal Comprehensive Environmental Response Compensation and
Liability Act of 1980 ("CERCLA"), the Federal Resource
Conservation and Recovery Act of 1976 ("RCRA"), or any other
federal, state or local environmental laws, statutes,
regulations, requirements and ordinances ("Hazardous Materials");
(ii) that there have been no investigations or reports involving
Lessee, or the Leased Premises by any governmental authority
which in any way pertain to Hazardous Materials (iii) that the
operation of the Leased Premises has not violated and is not
currently violating any federal, state or local law, regulation,
ordinance or requirement governing Hazardous Materials; (iv) that
the Leased Premises is not listed in the United States
Environmental Protection Agency's National Priorities List of
Hazardous Waste Sites nor any other list, schedule, log,
inventory or record of Hazardous Materials or hazardous waste
sites, whether maintained by the United States Government or any
state or local agency; and (v) that the Leased Premises will not
contain any formaldehyde, urea or asbestos, except as may have
been disclosed in writing to Lessor by Lessee at the time of
execution and delivery of this Lease. Lessee agrees to indemnify
and reimburse Lessor, its successors and assigns, for:
(a) any breach of these representations and warranties, and
(b) any loss, damage, expense or cost arising out of
or incurred by Lessor which is the result of a breach
of, misstatement of or misrepresentation of the above
covenants, representations and warranties, and
(c) any and all liability of any kind whatsoever which
Lessor may, for any cause and at any time, sustain or
incur by reason of Hazardous Materials discovered on
the Leased Premises during the term hereof or placed or
released on the Leased Premises by Lessee;
together with all attorneys' fees, costs and disbursements
incurred in connection with the defense of any action against
Lessor arising out of the above. These covenants,
representations and warranties shall be deemed continuing
covenants, representations and warranties for the benefit of
Lessor, and any successors and assigns of Lessor and shall
survive expiration or sooner termination of this Lease. The
amount of all such indemnified loss, damage, expense or cost,
shall bear interest thereon at the lesser of 15% or the highest
rate of interest allowed by law and shall become immediately due
and payable in full on demand of Lessor, its successors and
assigns.
ARTICLE 32. ESCROWS
Upon a default by Lessee which is uncured after the
expiration of any applicable notice and cure period, or upon the
request of Lessor's Mortgagee, if any, Lessee shall deposit with
Lessor on the first day of each and every month, an amount equal
to one-twelfth (1/12th) of the estimated annual real estate
taxes, assessments and insurance (if the insurance is to be
purchased by Lessor) ("Charges") due on the Leased Premises, or
such higher amounts reasonably determined by Lessor as necessary
to accumulate such amounts to enable Lessor to pay all charges
due and owing at least thirty (30) days prior to the date such
amounts are due and payable. From time to time out of such
deposits Lessor will, upon the presentation to Lessor by Lessee
of the bills therefor, pay the Charges or at Lessee's option,
will upon presentation of receipted bills therefor, reimburse
Lessee for such payments made by Lessee. In the event the
deposits on hand shall not be sufficient to pay all of the
estimated Charges when the same shall become due from time to
time or the prior payments shall be less than the currently
estimated monthly amounts, then Lessee shall pay to Lessor on
demand any amount necessary to make up the deficiency. The
excess of any such deposits shall be credited to subsequent
payments to be made for such items. If a default or an event of
default shall occur under the terms of this Lease, Lessor may, at
its option, without being required so to do, apply any Deposit on
hand to cure the default, in such order and manner as Lessor may
elect.
ARTICLE 33. NET LEASE
Notwithstanding anything contained herein to the contrary it
is the intent of the parties hereto that this Lease shall be a
net lease and that the Rent defined pursuant to Article 4 should
be a net Rent paid to Lessor. Any and all other expenses
including but not limited to, maintenance, repair, insurance,
taxes, and assessments, shall be paid by Lessee.
ARTICLE 34. DEVELOPMENT FINANCING AGREEMENT
The parties hereto hereby acknowledge that the terms hereof
are subject to and shall in the event of conflicts be controlled
by that certain Development Financing Agreement of even date
herewith, until such Agreement is terminated in accordance with
its terms.
ARTICLE 35. COUNTERPART EXECUTION
This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original and all of which shall
constitute one and the same instrument.
IN WITNESS WHEREOF, Lessor and Lessee have respectively
signed and sealed this Lease as of the day and year first above
written.
LESSEE: Tumbleweed, LLC.
Witness
/s/ Xxxx Xxxx By: /s/ Xxxxx Xxxxxxxxx
Xxxx Xxxx Its: Executive VP & CFO
Print Name
Witness
/s/ Xxxxx X Xxxxxxx
Xxxxx X Xxxxxxx
Print Name
Witness
/s/ Xxxx Xxxx By: /s/ Xxxx Xxxxxxx
Xxxx Xxxx Its: President
Print Name
Witness
/s/ Xxxxx X Xxxxxxx
Xxxxx X Xxxxxxx
Print Name
STATE OF Kentucky)
)SS.
COUNTY OF Jefferson)
The foregoing instrument was acknowledged before me this
29th day of May, 1998, by Xxxxx Xxxxxxxxx, as Executive VP & CFO
of Tumbleweed, LLC. on behalf of said limited liability company.
/s/ Xxxx X Xxxxxxxx
Notary Public
STATE OF Kentucky)
)SS.
COUNTY OF Jefferson)
The foregoing instrument was acknowledged before me this
29th day of May, 1998, by Xxxx Xxxxxxx, as President of
Tumbleweed, LLC. on behalf of said limited liability company.
/s/ Xxxx X Xxxxxxxx
Notary Public
[notary seal]
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
By: AEI Fund Management XVIII, Inc.
Witness
/s/ Xxxxxxx X Xxxxxxxx By: /s/ Xxxxxx X Xxxxxxx
Xxxxxxx X Xxxxxxxx Xxxxxx X. Xxxxxxx, President
Print Name
Witness
/s/ Xxxxx Xxxxxx
Xxxxx Xxxxxx
Print Name
STATE OF MINNESOTA )
)SS.
COUNTY OF XXXXXX )
The foregoing instrument was acknowledged before me the 1st
day of May, 1998, by Xxxxxx X Xxxxxxx, the President of AEI Fund
Management XVIII, Inc., a Minnesota corporation, corporate
general partner of AEI Real Estate Fund XVIII Limited
Partnership, on behalf of said limited partnership.
/s/ Xxxxxxx X Xxxxxxxxx
Notary Public
[notary seal]
Exhibit A
PARCEL 1
SITUATED IN THE STATE OF OHIO, COUNTY OF FRANKLIN, CITY OF
COLUMBUS, QUARTER XXXXXXXX 0, XXXXXXXX 0, XXXXX 00, XXXXXX XXXXXX
MILITARY LANDS, AND BEING 1.169 ACRES OF LAND ALL OUT OF THAT
1.915 ACRE TRACT AS CONVEYED TO BROAD STREET RETAIL, LLC BY DEED
OF RECORD IN INSTRUMENT NUMBER 19970300131362, ALL REFERENCES
REFER TO THE RECORDS OF THE RECORDER'S OFFICE, FRANKLIN COUNTY,
OHIO, AND BEING MORE PARTICULARLY BOUNDED AND DESCRIBED AS
FOLLOWS:
BEGINNING, FOR REFERENCE, AT AN IRON PIN SET AT THE INTERSECTION
OF THE SOUTHERLY RIGHT-OF-WAY LINE OF EAST BROAD STREET (STATE
ROUTE 16) WITH THE EASTERLY RIGHT-OF-WAY LINE OF ROSE HILL ROAD;
THENCE NORTH 81 DEG. 48' 10" EAST, WITH SAID SOUTHERLY RIGHT-OF-
WAY LINE, A DISTANCE OF 1259.07 FEET TO AN IRON PIN SET AT THE
NORTHEASTERLY CORNER OF A 21.979 ACRE TRACT AS CONVEYED TO BROAD
STREET RETAIL, LLC OF RECORD IN INSTRUMENT NUMBER 19970300131357
AND THE TRUE POINT OF BEGINNING FOR THIS DESCRPTION;
THENCE NORTH 81 DEG. 48' 10" EAST, CONTINUING WITH SAID RIGHT-OF-
WAY LINE A DISTANCE OF 217.00 FEET TO AN IRON PIN SET;
THENCE SOUTH 8 DEG. 11' 50" EAST, WITH A NEW DIVISION LINE ACROSS
SAID 1.915 ACRE TRACT, A DISTANCE OF 222.34 FEET TO AN IRON PIN
SET IN THE NORTHERLY LINE OF A 1.835 ACRE TRACT AS CONVEYED TO
BROAD STREET RETAIL, LLC, OF RECORD IN INSTRUMENT NUMBER
19970300131365;
THENCE SOUTH 75 DEG. 25' 05" WEST, PARTLY WITH THE NORTHERLY LINE
OF SAID 1.835 ACRE TRACT AND PARTLY WITH THE NORTHERLY LINE OF
SAID 21.979 ACRE TRACT, A DISTANCE OF 165.47 FEET TO AN IRON PIN
SET;
THENCE SOUTH 73 DEG. 19' 45" WEST, CONTINUING WITH THE NORTHERLY
LINE OF SAID 21.979 ACRE TRACT, A DISTANCE OF 53.13 FEET TO AN
IRON PIN SET AT A CORNER THEREOF;
NORTH 8 DEG. 11' 50" WEST, WITH AN EASTERLY LINE OF SAID 21.979
ACRE TTACT, A DISTANCE OF 248.58 FEET TO THE TRUE POINT OF
BEGINNING AND CONTAINING 1.169 ACRES OF LAND, MORE OR LESS.
THE BASIS OF BEARING FOR THIS DESCRIPTION IS NORTH 81 DEG. 48'
10" EAST FOR THE CENTERLINE OF EAST BROAD STREET (STATE ROUTE 16)
AS THE SAME IS SHOWN ON FRANKLIN COUNTY RIGHT-OF-WAY PLANS FRA-16-
7.79-10.44.
PARCEL II
TOGETHER WITH NON-EXCLUSIVE RIGHT OF INGRESS AND EGRESS OVER A
CERTAIN 21.979 ACRE PARCEL AS RESERVED IN INSTRUMENT NO.
199710300131357 AND OVER A CERTAIN 0.722 ACRE PARCEL AS CONTAINED
IN INSTRUMENT NO. 199710300131362, RECORDER'S OFFICE, FRANKLIN
COUNTY, OHIO.
