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EXHIBIT 10.6
AMENDED AND RESTATED
MASTER LEASE AGREEMENT
BETWEEN
SOUTHWEST PREMIER PROPERTIES, L.L.C.
AND
CENTRAL FREIGHT LINES, INC.
(revised as of April 5, 1999)
THIS MASTER LEASE AGREEMENT (the "Lease") is made between SOUTHWEST PREMIER
PROPERTIES, L.L.C., (the "Landlord") and CENTRAL FREIGHT LINES, INC., (the
"Tenant").
DEFINITIONS
For the purpose of this Lease, as amended from time to time, unless the context
otherwise requires, the following terms shall have the following meanings:
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"Parcel" Any one of the 37 real properties listed on Exhibit A
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"Property" Collectively, the 37 properties described in Exhibit A
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"Premises" The Property, subject to (i) Landlord's right under Section
2.1 to exclude Surplus Property, (ii) Landlord's right under
Section 2.4 to delete from the Premises any of the Revised
Exhibit B Parcels and substitute Comparable Facilities, and
(iii) Tenant's right under Section 2.4.8 to exclude a
Parcel. The Premises, as outlined in red on Exhibits B-1
through B-28, shows the Premises after Surplus Property has
been excluded. However, until the effective date of
Landlord's exercise of its right to exclude any particular
Parcel of Surplus Property, Premises shall refer to all
Property that has not yet been excluded.
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"Surplus Property" Those portions, defined in Section 2.1 and in the Revised
Exhibit B, of the 28 Parcels that are not needed for the
operations of the Tenant.
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"Comparable The replacement facility described in Section 2.4.3 of the
Facilities" First Amendment, which becomes the subject of a New Lease
under Section 2.4.6 of the First Amendment
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"New Lease" A lease separate and apart from this Lease that Landlord and
Tenant enter into under Section 2.4.6 for the Comparable
Facilities.
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"Upgrades" Significant improvements for replacement facilities over
existing facilities, as described in Section 2.4.5 of the
First Amendment
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"Primary Term" May 22, 1998 through May 21, 2008, as defined in Section 3.1
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"Five Year As defined in Section 3.2
Extensions"
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"Ten Year Term" As defined in Section 3.2
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"Extension Terms" As defined in Section 3.2
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"Rent" As defined in Section 4.1
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"FMRV" Fair market rental value, as defined in Section 4.2
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"Landlord As defined in Sections 4.3 and 29
Appraiser"
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"Tenant Appraiser" As defined in Sections 4.3 and 29
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"Independent As defined in Sections 4.3 and 29
Appraiser"
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"Indemnitor" As defined in Section 21
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"Indemnitee" As defined in Section 21
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"Losses" As defined in Section 21
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1 DEMISE: In consideration of the undertakings of the parties contained
herein, Landlord leases to Tenant, and Tenant leases from Landlord, the
Thirty-Seven (37) properties described in Section 2 (herein collectively
referred to as the "Premises"), on the terms and conditions contained in this
instrument.
2 PREMISES: Subject to the reservation of Surplus Property (as described
below) and to the other terms and conditions herein contained, the Landlord
leases to Tenant the Thirty-Seven (37) properties described in Exhibit A,
attached hereto.
2.1 RESERVATION OF SURPLUS PROPERTY BY LANDLORD: Attached hereto as Revised
Exhibit B is a list describing portions of the Premises, including portions in
Waco, Dallas, and Houston, that are not needed for the operations of the Tenant
(herein, each itemized parcel, and the aggregate of all parcels identified on
Revised Exhibit B, are referred to interchangeably as "Surplus Property").
Landlord hereby reserves the right to exclude from the Premises and the scope of
this Master Lease Agreement, any or all Surplus Property, without reduction in
rent.
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2.2 LANDLORD'S EXERCISE OF RIGHT TO EXCLUDE SURPLUS PROPERTY: Landlord
shall exercise its right to exclude Surplus Property from the scope of this
Lease by providing Tenant at least sixty (60) days prior written notice,
identifying with particularity which parcel or parcels are to be excluded, and
the effective date of such exclusion. Thereafter, Landlord shall have all rights
of a fee simple owner of the excluded Surplus Property, including the rights to
subdivide, develop, and/or to sell it.
2.3 TENANT'S USE OF SURPLUS PROPERTY PRIOR TO EXCLUSION FROM LEASE.: At any
time prior to the effective date designated in Landlord's notice of exercise of
its right to exclude Surplus Property, Tenant may use the Surplus Property
subject to the terms of this Lease for all lawful purposes, including subleasing
it for trailer pads. No improvements shall be constructed on the Surplus
Property by Tenant without the prior written consent of Landlord.
2.4 LANDLORD'S RIGHT TO SUBSTITUTE COMPARABLE FACILITIES: Landlord has the
right to substitute "Comparable Facilities" (as defined below) for any of the
Revised Exhibit B Parcels containing Surplus Property, under the following terms
and conditions:
2.4.1 When Exercisable. The right is exercisable whenever Landlord
receives an offer to purchase, lease, or joint venture any of the Revised
Exhibit B Parcels that Landlord is willing to accept.
2.4.2 Notices; Timing; Procedure. To exercise the right, Landlord
shall provide Tenant written notice, which notice shall identify the
affected Parcel and shall propose a replacement facility for Tenant.
Thereafter, Tenant shall select one of the following options:
(i) accept the replacement facility,
(ii) reject the replacement facility and, instead, opt out of
the Lease under Section 2.4.8, or
(iii) submit the question to binding arbitration under Section
2.4.3,
and shall notify Landlord within 30 days following the date on which Tenant
received Landlord's Section 2.4.2 notice. In the absence of a response from
Tenant, Tenant shall be deemed to have selected option (ii). Thereafter,
Landlord shall have 30 days following its receipt of Tenant's notice to
notify Tenant that Landlord has selected one of the following options:
(i) either that Landlord will agree to provide the replacement
facility or that Landlord will agree to Tenant's opting
out of the Lease under Section 2.4.8 for the affected
Parcel, or
(ii) to rescind Landlord's initial Section 2.4.2 notice and
return to the status quo (prior to Landlord's Section
2.4.2 notice) with respect to the affected Parcel.
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Following the expiration of the second 30-day period, and in the event
Tenant does not plan to remain at the affected Parcel, Tenant shall have
six (6) months within which to vacate the Parcel, unless the parties agree
otherwise, or unless, if Landlord is providing the replacement facility,
such facility is not ready for occupancy, in which event Tenant shall
vacate the affected Parcel when the replacement facility is ready for
occupancy.
2.4.3 "Comparable Facilities". Landlord, at Landlord's expense, shall
provide Tenant "Comparable Facilities", meaning a replacement facility for
use as a trucking terminal either (i) having business utility at least
comparable to the existing facility being replaced or (ii) that is
otherwise acceptable to Tenant, in Tenant's sole judgment. In determining
business utility, the following factors shall be taken into consideration:
(a) Whether the replacement facility is comparable to the
existing facility;
(b) Size, in square footage, of property and of building;
(c) Layout, including internal circulation;
(d) Location and accessibility in relation to major roadways;
(e) Ease of accessibility to site by a tractor-trailer;
(f) Convenience of location in relation to customer base (within
10 miles of the existing facility is presumed to have convenient
location to customer base);
(g) Adequacy of security or ease in providing adequate security;
(h) Appropriate zoning;
(i) Absence of environmental concerns;
(j) Physical condition of the premises.
In the event a proposed replacement facility is not otherwise acceptable to
Tenant and Landlord and Tenant cannot agree as to whether any proposed
Comparable Facilities has comparable business utility to the facility being
replaced, the parties may submit, for binding arbitration, such question to
a duly qualified appraiser in the same manner as is provided in Sections
4.3 and 29 of the Lease for determining Fair Market Rental Value or Fair
Market Value for purposes of the Options to Extend or the Option to
Purchase granted therein. In the event the parties agree to such
submission, the appraiser's determination shall be binding upon the parties
as to the issues presented to such appraiser.
2.4.4 Irving/Dallas. In addition to the factors set forth in Section
2.4.3 above, for the Irving/Dallas Parcel only, Tenant may require Landlord
to provide two separate facilities in the Irving/Dallas greater
metropolitan area that together have business utility comparable to the
existing facility.
2.4.5 Upgrades. In the event Tenant desires to upgrade its facilities
(meaning, to make any significant quantitative or qualitative improvement
over what would otherwise be a facility having comparable business utility,
in any of the factors listed in Section 2.4.3 above) in connection with
Landlord's exercising its Section 2.4 right to substitute ("Upgrades"),
Tenant may do so at its cost and expense, upon written request to Landlord.
At Tenant's option, Tenant may require Landlord to pay initially for the
Upgrades, and Tenant shall repay Landlord in the form of additional rent,
as provided in Section 2.4.7, under the New Lease
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described in Section 2.4.6. Tenant shall provide Landlord adequate notice
of its desire to upgrade.
2.4.6 New Lease for substitute premises. In the event Landlord
exercises its right to substitute and the parties agree on Comparable
Facilities, the Premises being vacated shall be deleted from this Lease and
the parties shall enter into a new lease for the replacement facility ("New
Lease"), for the rent described in Section 2.4.7 and upon substantially the
same other terms and conditions as this Lease, except where the fact
pattern obviously differs. This Lease shall be amended accordingly to
reflect the deletion of the vacated Parcel from the Premises being leased
and to reflect a rent decrease by the amount allocated to the vacated
Parcel as shown on Exhibit C, prorated to the date Tenant vacates such
Parcel.
2.4.7 Rent for the Comparable Facilities. Annual base rent for the
Comparable Facilities, without regard for any Upgrades provided upon
Tenant's request, shall be:
(i) for the balance of the Primary Term of this Lease, that
amount allocated to the vacated Parcel as shown on Exhibit
C, and
(ii) in the event the initial term of the New Lease for the
replacement facility extends beyond the Primary Term of
this Lease, the annual base rent payable under the New
Lease for such extended period shall be negotiated between
Landlord and Tenant; subject to a three year rent
guarantee, computed as follows, for the first three years
of the New Lease for the Comparable Facility. The three
year rent guarantee applies when Tenant vacates the
existing Parcel and first occupies the replacement facility
anytime on or after May 22, 2005 but on or before May 21,
2008, in which event, the rent for the first three years
shall be at two different rates: (1) for the balance of the
Primary Term of this Lease, it shall be that amount
allocated to the vacated Parcel as shown on Exhibit C, and
(2) for the balance of the first three years of the New
Lease of the replacement facility, it shall be no greater
than the FMRV of the vacated Parcel would have been had the
Tenant remained in such vacated Parcel beyond the Primary
Term.
Tenant may elect to pay for Upgrades by amortizing their cost over the term
of the New Lease for the Comparable Facilities, under terms acceptable to
both Landlord and Tenant.
2.4.8 Tenant's Right to Exclude any Particular Revised Exhibit B
Parcel from Lease. If Landlord has given the Section 2.4.2 notice to
exercise its Section 2.4 right to substitute Comparable Facilities, and
Landlord and Tenant are unable to agree on all of the material terms
associated with implementing such arrangement, including, but not limited
to, (i) whether a replacement facility constitutes Comparable Facilities,
(ii) the rent amount for the
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substitute premises under the Section 2.4.6 New Lease for the portion of
the term extending beyond the Primary Term of this Lease, or (iii) the
terms of payment for any Upgrades, then Tenant may, by written notice to
Landlord, elect to have the subject Parcel excluded from the Lease, and the
rent payable under the Lease shall be reduced by the amount allocated to
such excluded Parcel as shown on Exhibit C, prorated to the effective date
of such exclusion.
3 TERM
3.1 PRIMARY TERM: The term of this Lease shall be for a period of ten (10)
years, commencing May 22, 1998 through May 21, 2008 ( the "Primary Term") unless
sooner terminated as hereinafter provided.
3.2 EXTENSION TERMS: Subject to Sections 3.3 and 18, Tenant shall have the
option to extend the Primary Term for two (2) successive extension terms of five
(5) years each (the Five Year Extensions"), or for one ten (10) year term (the
"Ten Year Term"), hereafter collectively called the "Extension Terms". The Ten
Year Extension Term shall begin on May 22, 2008, and shall terminate on May 21,
2018. Alternatively, the Five Year Extension Term(s) shall begin and end as
follows:
1st five year option: May 22, 2008 through May 21, 2013.
2nd five year option: May 22, 2013 through May 21, 2018.
3.3 EXTENSION TERM NOTIFICATION: As a condition precedent to its exercise
of any option to renew this Lease under any of the aforementioned Extension
Terms, Tenant shall give to Landlord one-hundred and twenty (120) days advance
written notice of Tenant's intention to renew this Lease. The notice shall
specify whether the Extension Term is for five or ten years. In the event that
notice to extend the Lease is given, but Tenant fails to specify which Extension
Term is being chosen, the Extension Term will be for five (5) years.
3.4 TERM OF THIS LEASE: The Primary Term and all Extension Terms elected by
Tenant are referred to collectively as the "Term of this Lease".
4 RENT
4.1. PRIMARY TERM: During the Term of this Lease, Tenant shall pay rent to
Landlord in equal monthly installments (the "Rent") an annual rental equivalent
to 11.1% of the $27,755,326 purchase price. The first monthly installment of
Rent shall be payable in advance on or before May 22, 1998 ( the "Rent
Commencement Date"), and on or before the first business day of each calendar
month thereafter. Rent for partial months at the inception or the termination of
the Lease shall be prorated.
4.2 EXTENSION TERMS: The Rent for any Extension Term shall be equal to the
fair market rental value ("FMRV") at the time the notice to exercise on
Extension Term is given. The FMRV shall be as agreed to in good faith by the
Landlord and Tenant; if no agreement as been
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reached within 30 days of the written notice of intent, then the parties shall
proceed as directed in Section 4.3.
4.3 APPRAISAL: If no agreement has been reached by the parties regarding
the FMRV, then the FMRV shall be determined by an independent and duly qualified
appraiser mutually agreeable to the Landlord and Tenant and the cost of such
appraisal shall be borne equally by the Landlord and the Tenant. If no agreement
can be reached in choosing such an appraiser, then the Landlord shall select an
appraiser (the "Landlord Appraiser") and the Tenant shall select an appraiser
(the "Tenant Appraiser") and such appraisers shall mutually agree upon the FMRV.
Each party shall bear the cost of its selected appraiser. If the Landlord
Appraiser and the Tenant Appraiser are unable to agree to the FMRV, then the
Landlord Appraiser and the Tenant Appraiser are unable to agree to the FMRV,
then the Landlord Appraiser and the Tenant Appraiser shall select a mutually
agreeable independent and duly qualified appraiser (the "Independent
Appraiser"). The determination of the FMRV by the Independent Appraiser shall be
binding on the parties. "Appraiser," as used in this paragraph, shall include
duly licensed real estate brokers.
5 REAL ESTATE TAXES AND ASSESSMENTS: During the Term of this Lease, Tenant
shall pay, as the same may become due and payable and before any fine, penalty,
interest or other charge may be added for nonpayment, all real estate taxes and
assessments, general and special, against the Premises.
6 UTILITIES: During the Term of this Lease, Tenant shall pay all charges
for utility services supplied upon or in connection with the Premises, including
without limitation, gas and electricity, sanitary and storm sewer, water,
telephone services, heat, light and power.
7 CONDITIONS OF PREMISES: The Tenant has examined the Premises and is
satisfied with the physical condition thereof, including all equipment and
appurtenances, and its taking possession thereof shall be conclusive evidence of
its receipt thereof in good and satisfactory order and repair, unless otherwise
specified herein. Tenant acknowledges that no representation as to the condition
or repair of the Premises has been made by or on behalf of the Landlord, except
as herein expressed, and likewise acknowledges that no agreement or promise to
decorate, alter, repair or improve the Premises, including all equipment and
appurtenances, either before or after the execution hereof, has been made by or
on behalf of the Landlord, except as stated herein. The occupancy by Tenant of
the leased Premises shall constitute an acknowledgment by Tenant that the
Premises are in the condition called for by this Lease and that Landlord has
performed all of the Landlord's work with respect thereto and that all
construction and/or remodeling required in accordance with the terms of this
Lease have been fully and satisfactorily completed in accordance with the terms
hereof.
8 POSSESSION OF PREMISES: Landlord shall deliver possession of the Premises
to Tenant on or before the commencement date of this Lease.
9 TENANT IMPROVEMENTS: Tenant, at its sole cost and expense, shall have the
right, but shall not be obligated, prior to and during the Term of this Lease,
to improve, alter and renovate the Premises in any manner which Tenant deems
necessary or desirable to adapt the same for the conduct of its business
operations, including without limitation, painting, decorating, redecorating and
installing partitions, floor coverings, wall coverings, drop ceilings, light
fixtures.
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10 TRADE FIXTURES: Personal Property: Tenant, at its sole cost and expense,
shall have the right, but shall not be obligated, to install, use, replace, and
remove its trade fixtures and personal property, such as, without limitation,
telephone, teletype and other communications equipment, machinery, dock
levelers, task lights, office furniture, office trailers and its Roof Antenna.
Upon the expiration of the Term of this Lease, Tenant shall have the right to
remove such trade fixtures and personal property from the Premises, provided
that Tenant shall repair all damage to the Premises resulting from such removal.
11 MAINTENANCE AND REPAIRS BY LANDLORD
11.1 BY LANDLORD: In consideration of this Lease and the rate of rent
contained in this Lease, the Tenant agrees that during the Term of the Lease,
the Tenant will, at its own expense, pay all maintenance and repair expenses for
the Premises. In the event any of the Tenant's maintenance repair is performed
by the Landlord or its designees, the Landlord shall be entitled to
reimbursement for any expenses incurred by Landlord. Amounts advanced shall bear
interest from the date of the advance. Nothing in the paragraph shall be
interpreted as requiring the Landlord to perform any such acts independent of
the other provisions of this Lease.
12 MAINTENANCE AND REPAIRS BY TENANT: Tenant, at its sole cost and expense,
shall keep the Premises in a clean and orderly condition and shall perform all
maintenance and repair to the Premises including but not limited to the
following:
(A) The structure and exterior of Landlord's buildings including without
limitation, the roof and roof membrane, walls, floors, foundations, supports,
windows, overhead doors, skylights, roof vents, drains, downspouts and
landscaping;
(B) The mechanical and utility systems serving the Premises including
without limitation, heating ventilation, air conditioning, lighting, electrical,
plumbing, gas, water supply, sanitary sewers and septic systems, storm sewers
and storm water drainage systems, sprinkler systems, exterior telephone and
communications lines and circuits and underground or overhead electrical supply;
(C) All periodic repaving and any patching and pothole maintenance of the
yard, parking, drive and other hard-surfaced areas of the Premises, together
with curbs and walkways; and
(D) Any repair occasioned or caused by Tenant's negligence or misconduct.
13 INSURANCE: At all times during the Term of this Lease, Tenant, at its
sole cost and expense, shall provide and maintain in full force and effect an
insurance policy or policies protecting Landlord and Tenant, and their officers,
employees, members, and managers against any loss, liability or expense from
personal injury, death, property damage or otherwise arising or occurring upon
or in connection with the Premises or by reason of the Tenant's operations upon
or occupancy of the premises, whether the same occurs or the cause arises on or
off the Premises. This coverage shall include, but not be limited to, fire and
extended coverage insurance (including flooding, vandalism, malicious mischief
and special extended perils or all risk) in an amount not less than the full
replacement cost of the damaged portion of the Premises, with a standard
inflation
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guard endorsement or, in the event the parties have agreed upon a fixed amount
of insurance, with a fixed amount endorsement. Tenant shall maintain in full
force and effect a public liability insurance policy for the Premises with
coverage limits of $2,000,000 for bodily injury and $250,000 for property
damage. Certificates of insurance showing compliance with the foregoing
requirements shall be furnished, if requested, by Tenant to Landlord. Each such
certificate shall contain an agreement by the insurer that such insurance
coverage shall not be modified or canceled without delivery of at least thirty
(30) days written notice to the Landlord.
14 DENIAL OF SUBROGATION RIGHTS: Neither the Landlord nor the Tenant shall
be liable to the other for any business interruption or any loss or damage to
property or injury to or death of persons occurring on the Premises or the
adjoining property, or in any manner growing out of or connected with the
Tenant's use and occupancy of the Premises, or the condition thereof, or of the
adjoining property, whether or not caused by the negligence or other fault of
the Landlord or the Tenant or of their respective agents, employees, subtenants,
licensees, managers, members, or assignees. This release shall apply only to the
extent that such business interruption, loss or damage to property or injury to
or death of persons is covered by insurance, regardless of whether such
insurance is payable to or protects the Landlord or the Tenant or both. Nothing
in this paragraph shall be construed to impose any other or greater liability
upon either the Landlord or the Tenant than would have existed in the absence of
this paragraph.
15 RENT ADJUSTMENT UPON DAMAGE BY FIRE OR OTHER CASUALTY: In the event that
one or more of the thirty-seven (37) properties constituting the Premises shall
be partially or wholly destroyed or damaged by fire or other casualty, without
the fault of the Tenant, so that the same shall be unfit for use or occupancy,
then Tenant shall give Landlord immediate written notice of the same, and a Rent
Adjustment, according to the nature and extent of the damage sustained in loss
of use or occupancy, shall occur.
16 CONDEMNATION OF PREMISES: In the event that one or more of the
thirty-seven (37) properties constituting the Premises shall be, in whole or
part, condemned or taken, then Landlord shall give Tenant written notice of the
same, and effective as of the date of vesting of title, a Rent Adjustment shall
occur.
17 DEFAULT OF TENANT: A default by Tenant under this lease shall occur if
any of the following occur, but a default is not limited to the following:
(A) Any one or more rent payments due from the Tenant to the Landlord shall
be and remain unpaid in whole or part after they are due and payable;
(B) The Tenant fails to provide insurance as required by this Lease and the
default continues for more than ten (10) days after notice from Landlord;
(C) The Tenant violates or defaults in any of the other covenants,
agreements, stipulations or conditions herein and such violation or default
shall continue for a period of thirty (30) days after written notice from the
Landlord of such violation of default; or
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(D) If the Tenant shall become insolvent, make an assignment for the
benefit of its creditors, or if a receiver is appointed for the Tenant.
18 LANDLORD'S REMEDIES UPON TENANT'S DEFAULT: The remedies provided in this
paragraph are not exclusive and are in addition to any other remedies now or
later allowed by law. Upon default of the Tenant:
(A) The Landlord may, at its option, declare this Lease forfeited, the
Lease term ended, have the right to reenter the Premises and have the right to
take possession of the Premises without any further obligation to Tenant.
Landlord may remove all persons and property at the cost of Tenant.
(B) Landlord may instead elect to keep Tenant in possession and continue to
have all rights and remedies under this Lease. If Landlord elects to keep Tenant
in possession, Landlord shall have the rights under subparagraph (A) for any
future defaults or for any previous default which remains uncured.
(C) If Landlord elects under subparagraph (B) to keep the Lease in force,
Landlord may lease the Premises at a rate of rent determined by Landlord to be
reasonable. Tenant shall pay to Landlord any costs incurred in leasing the
property and any rents under this lease in excess of the rent which Landlord
actually receives from new Tenant. The new Tenant may pay rents directly to
Landlord.
19 LANDLORD'S DEFAULT: In the event of any failure by Landlord to perform
any term, condition, covenant or obligation of this Lease on the part of
Landlord to be performed within fifteen (15) days after the date on which
Landlord receives from Tenant notice by certified or registered mail
specifically describing such failure, Tenant (in addition to all other remedies
to which Tenant may be entitled under this instrument or at law or in equity)
may cure such default by Landlord on behalf of, and at the sole cost and expense
of Landlord, including a supervision charge of twenty percent (20%) of all costs
and expenses in connection therewith within thirty (30) days after Tenant's
delivery to Landlord of an invoice therefor, failing which Tenant may offset
such costs and expenses against any Rent and other amounts payable by Tenant
hereunder. The foregoing notwithstanding, if Landlord shall exercise in good
faith diligent efforts within such fifteen (15) day period to cure the failure
specified in the notice but shall not be able to do so because of acts of God,
riots, or labor strikes, then any such failure shall not be considered a default
of this Lease by Landlord so long as Landlord shall continue to exercise in good
faith such diligent efforts to cure such failure and shall do so within a
reasonable period of time.
20 LANDLORD'S RIGHTS OF ENTRY: Following reasonable notice to Tenant,
Landlord may enter upon the Premises as often as Landlord may deem reasonably
necessary for the purposes of inspecting the Premises, offering the Premises for
lease (but only during the period which commences sixty (60) days prior to the
expiration of the then existing Primary Term or Extension Term), offering the
Premises for sale or transfer, or any other reason which the Landlord, in good
faith, believes necessary in its business judgment. Landlord's right of entry
shall be exercised in a manner and at times such that there shall be no
unreasonable interference with the use and occupancy of the Premises by Tenant
for the conduct of its business operations.
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21 MUTUAL INDEMNIFICATION: Each party (the "Indemnitor") agrees to
indemnify, defend and hold the other party (the "Indemnitee") harmless from and
against any and all losses, damages, claims, suits, actions, judgments,
liabilities and expenses, including, without limitation, environmental damages
and remediation expenses, reasonable attorneys' fees (collectively, "Losses"),
arising out of , or with respect to: (a) any breach of any warranty or
representation or any covenant or agreement of the Indemnitor under this Lease;
or (b) any injury to, or death of, persons and/or any damage to, or destruction
of, property, on or about the Premises and attributable to the negligence or
misconduct of the Indemnitor, or its officers, employees, agents, contractors or
invitees, except for any such breach, any injury or death or any damage or
destruction arising out of, or with respect to, the negligence or misconduct of
the Indemnitee, or any of its officers, employees, agents, contractors or
invitees, or at otherwise specifically provided in this Lease; provided,
however, that the indemnification obligation created by this Section shall be
expressly conditioned upon the Indemnitee (i) delivering to the Indemnitor
prompt notice of any event giving rise to such indemnification obligation and
(ii) providing the Indemnitor the opportunity to defend itself from and against
any Losses.
22 TRANSFERS
22.1 ASSIGNMENT AND SUBLETTING: Tenant shall have the right to assign this
Lease and/or sublet any portion of the Premises, with or without the consent of
Landlord. Absent the written agreement of Landlord, no assignment of this Lease
or subletting of all or any portion of the Premises shall relieve Tenant of any
of the terms, conditions, covenants and obligations of this Lease on the part of
Tenant to be performed.
22.2 NOTICE OF SALE/RIGHT OF FIRST REFUSAL: It is understood by the parties
that the Landlord may, at any time, desire to sell all or part of the Premises.
If Landlord desires to sell all or a portion (i.e. one or more of the 37 parcels
described previously in Exhibit A) of the Premises during the Term of this
Lease, and receives a signed offer or other such contract under terms and
conditions acceptable to the Landlord, Landlord will give notice to Tenant,
including the terms and conditions of the offer for transfer or sale. If within
sixty (60) days of said notice, Tenant shall decide to purchase the property,
Landlord and Tenant will execute a contract of sale under the same terms and
conditions of said offer. Landlord may sell Surplus Property, which is not
subject to this Right of First Refusal.
23 HOLDING OVER: If Tenant shall continue to occupy the Premises after the
expiration of the Term of this Lease or the earlier termination of this Lease,
without exercising an Extension Term, then Tenant shall be deemed to be
occupying the Premises as a tenant from month-to-month, subject to the terms and
conditions of this Lease; provided, however, that either party shall have the
right to terminate such month-to-month tenancy upon delivery of thirty (30)
days' notice to the other.
24 QUIET ENJOYMENT
24.1 LANDLORD'S COVENANT: Landlord covenants and agrees that Tenant shall
have the peaceful and quiet possession and enjoyment of the Premises (subject to
all mortgages and other matters to which this Lease, is or shall become,
subordinate in accordance with the provisions of Section 25) for the conduct of
its business operations during the Term of this Lease, without hindrance by
Landlord or any party whatsoever.
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25 SUBORDINATION OF LEASE TO MORTGAGES: This Lease shall be subject and
subordinate at all times to the lien of existing mortgages and of mortgages
which hereafter may be made a lien on the Premises. Although no instrument or
act on the part of the Tenant shall be necessary to effectuate such
subordination, the Tenant will nevertheless execute and deliver such further
instruments subordinating this Lease to the lien of any such mortgages as may be
desired by the mortgagee. The Tenant hereby irrevocably appoints the Landlord
his attorney-in-fact to execute and deliver any such instrument for the Tenant.
Provided, however, and notwithstanding the foregoing provisions hereof, upon
foreclosure of the mortgage with the mortgagee succeeding to the rights of the
Landlord, the Tenant shall, at the option of said mortgagee, attorn to the
mortgagee as follows:
(A) Tenant shall be bound to the mortgagee under all the terms of the
Lease for the balance of the term hereof remaining with the same force and
effect as if the mortgagee were the Landlord under the Lease, and Tenant hereby
attorns to the mortgagee as its Landlord, such attornment to be effective and
self-operative, without the execution of further instrument on the part of
either of the parties hereto, and immediately upon the mortgagee succeeding to
the interest of Landlord under this lease and having given written notice of the
same to Tenant. The respective rights and obligations of Tenant and of the
mortgagee upon such attornment shall to the extent of the remaining term of the
lease be the same as now set.
(B) The mortgagee shall be bound to the Tenant under all of the terms of
this Lease, and the Tenant shall, from and after such event, have the same
remedies against the mortgagee for the breach of an agreement contained in this
Lease that the Tenant might have had under this Lease against the Landlord
hereunder. In no event, however, shall the mortgagee be liable for any act or
omission of any prior Landlord, be subject to any offsets or defenses which
Tenant might have against any prior Landlord, or be bound by any rent or
additional rent which the Tenant might have paid to any prior Landlord for more
than the current month.
26 SURRENDER OF PREMISES: Upon the expiration or earlier termination of the
Term of this Lease, Tenant shall deliver up and surrender the Premises to
Landlord in the same condition as it was at the Rent Commencement Date, subject
to: (a) Tenant's improvements, alterations and renovations to the Premises; (b)
normal wear and tear; and (c) damage by fire, explosion or other casualty which
is not covered by insurance .
27 RENT AND NOTICES: Rent and any and all notices or demands required or
permitted to be given hereunder deemed to be properly served if hand-delivered
or sent by registered or certified mail, postage prepaid, addressed to the
Landlord at
Southwest Premier Properties, L.L.C.
Attn: Xxx Xxxx
X.X. Xxx 0000
Xxxx, XX 00000
or addressed to the Tenant at
Central Freight Lines, Inc.
Attn: Xxxx Xxxxx
X.X. Xxx 0000
Xxxx, XX 00000
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or at such other address as either party may hereafter designate in writing to
the other. Any notice or demand so mailed shall be effective for all purposes at
the time of deposit thereof in the United States mail.
28 SIGNS: Tenant shall have exclusive sign rights for the Premises,
exterior and interior, and shall have the right to erect and display signs on
the Premises and on such other areas of the Premises as Tenant reasonably may
request, subject only to compliance with applicable laws, ordinances and
requirements of governmental authorities with competent jurisdiction.
29 OPTION TO PURCHASE: At any time after the expiration of the Primary Term
but while Tenant is still a Tenant under this Lease, Tenant shall have the
option to purchase that portion of the Premises utilized and occupied by the
Tenant in its truck line operations, or an integral part of any land or building
so utilized or occupied, but shall not have the option to purchase the Surplus
Property. In the event Landlord sells any parcels comprising the Premises prior
to Tenant's exercise of this option, this option shall extend only to the
remaining Premises. The purchase price shall be equal to the Fair Market Value
of the Premises, as determined by a duly qualified appraiser mutually agreeable
to the Landlord and Tenant and the cost of such appraisal shall be borne equally
by the Landlord and the Tenant. If no agreement can be reached in choosing such
an appraiser, then the Landlord shall select an appraiser (the "Landlord
Appraiser") and the Tenant shall select an appraiser (the "Tenant Appraiser")
and such appraisers shall mutually agree upon the Fair Market Value. Each party
shall bear the cost of its selected appraiser. If the Landlord Appraiser and the
Tenant Appraiser are unable to agree to the Fair Market Value, then the Landlord
Appraiser and the Tenant Appraiser shall select a mutually agreeable independent
and duly qualified appraiser (the "Independent Appraiser"). The determination of
the Fair Market Value by the Independent Appraiser shall be binding on the
parties. "Appraiser," as used in this paragraph, shall include duly licensed
real estate brokers. Tenant may exercise the option to purchase by delivering
written notice to Landlord of its election to exercise the option.
30 AMENDMENTS. The Tenant and Landlord agree that amendments to this Master
Lease may be necessary from time to time to reflect changes in the number of
properties constituting the Premises, the Rent, and other such changes described
in the Lease. The parties agree that any amendments will be made in writing and
signed by Landlord and Tenant, or will have no effect on this Master Lease.
31 MISCELLANEOUS:
(A) This Lease: (i) contains the entire agreement between the parties and
no promise, representation, warranty, covenant, agreement, or understanding not
specifically set forth in this Lease shall be binding upon either party; (ii)
may not be amended, modified, or supplemented in any manner except in writing
signed by the parties; (iii) shall be construed and governed under the laws of
Texas; (iv) shall not be construed more stringently in favor of one party
against the other regardless of which party has prepared the same; (v) shall be
binding upon, and inure to the benefit of, the parties and their respective
heirs, executors, administrators, personal and legal representatives,
successors, and permitted assigns; (vi) shall not be binding until this Lease
shall be executed and delivered by the parties, to each other; and (vii) may be
executed in counter parts, each of which shall be deemed an original, but which
all together constitute the same instrument.
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(B) Any person executing this Lease on behalf of a corporation or limited
liability company represents and warrants that such person is authorized to
execute and deliver this Lease on behalf of the entity.
(C) The invalidity or unenforceability of any term or provision shall not
affect the validity or enforceability of the remainder of this Lease.
32. ENVIRONMENTAL COMPLIANCE: Tenant shall, at its expense, comply with all
Environmental Laws, as defined below, and furnish satisfactory evidence of such
compliance upon request of Landlord. Should any discharge, leakage, spillage,
emission, or pollution of any type occur upon or from the Premises due to
Tenant's use and occupancy thereof, Tenant, at its expense shall be obligated to
perform appropriate remediation. The term "Environmental Laws" shall mean any
federal, state or local law, statute, ordinance, or regulation pertaining to any
Hazardous Substances, as defined below, or to health, industrial hygiene, or the
environmental conditions on, under or about the Premises, including without
limitation, the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980 ("CERCLA"), as amended, the Resource Conservation and
Recovery Act of 1976 ("RCRA") and state laws regarding underground storage
tanks. The term "Hazardous Substances" means and includes any petroleum products
and any substances included within the definitions of hazardous substances or
hazardous materials in CERCLA, RCRA, and other federal, state or local statutes,
laws, ordinances, codes, rules, or regulations relating to, or imposing
liability or standards of conduct concerning any hazardous, toxic or dangerous
wastes, substance or material, as now or at any time hereafter in effect. Tenant
hereby (i) acknowledges that it has assumed certain environmental liabilities
and obligations of Viking Freight, Inc., and (ii) agrees to indemnify and hold
harmless Landlord from and against any and all claims, damages and liabilities
arising in connection with the presence, use, storage, disposal, transport,
generation, recycling, treatment, reuse, reclamation, handling, release, or
threatened release of any Hazardous Substances on, from or about the Premises.
IN WITNESS WHEREOF, the parties have caused this Amended and Restated Lease to
be duly executed by each of their respective authorized representatives
effective as of April 5, 1999.
SOUTHWEST PREMIER CENTRAL FREIGHT LINES, INC.
PROPERTIES, L.L.C.
By: /s/ Xxx X. Xxxx By: /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------- -----------------------------------
Xxx X. Xxxx Xxxxxxx X. Xxxxxxxxx
Its: President Its: Senior Vice President of Operations
Dated: April 5, 1999 Dated: April 5, 1999
----------------------------- ---------------------------------
By: /s/ Xxxx Xxxxx
-----------------------------------
Xxxx Xxxxx
Its: Director of Administration
Dated: April 5, 1999
EXHIBITS
Exhibit A - Property
Revised Exhibit B - List of Surplus Property
Exhibit C - Value and Rent Allocation by Parcel
