Exhibit 10.106
Lease Agreement for Store - Thousand Oaks
SHOPPING CENTER LEASE
In consideration of the rents and covenants hereinafter set forth, Landlord
leases to Tenant, and Tenant leases from Landlord, the Premises upon the terms
and conditions of this Shopping Center Lease ("Lease") entered into and dated
June 9, 1998 ("Execution Date").
ARTICLE 1
FUNDAMENTAL LEASE PROVISIONS
ARTICLE 1 FUNDAMENTAL LEASE PROVISIONS
1.1 Landlord: THE OAKS SHOPPING CENTER, L.P., a California limited
partnership
1.2 Tenant: TOYS INTERNATIONAL, a California corporation
1.3 Tenant's Trade Name: TOYS INTERNATIONAL (Section 9.1)
1.4 Premises: That certain retail space currently identified as "Space No.
1(Sectioni2.1)e Shopping Center known as "THE OAKS," located in the City of
Xxxxxxxx Xxxx, Xxxxxx xx Xxxxxxx, Xxxxx xx Xxxxxxxxxx, containing approximately
5,339 square feet of Floor Area with a frontage of approximately 49.33 feet. The
Premises are shown in that approximate location crosshatched on Exhibit A.
1.5 Lease Term: Approximately ten (10) years, two (2) months. (Section 3.1)
1.6 Target Delivery Date: August 1, 1998 (Section 2.3)
1.7 Expiration Date: December 31, 2008 (Section 3.1)
1.8 Rent Commencement Date: The earlier to occur of October 15, 1998 or
the(Sectionn4.1)first opens for business in the Premises.
1.9 Minimum Annual Rent: One Hundred Thirty-Three Thousand Four(Section
4.2)nty-Five and No/100 Dollars ($133,475.00) per annum, beginning with the Rent
Commencement Date and continuing for the first five (5) full years of the Lease
Term plus any partial calendar month at the beginning of the Lease Term; then,
One Hundred Forty-Four Thousand One Hundred Fifty-Three and No/100 Dollars
($144,153.00) per annum for the remainder of the Lease Term.
1.10 Percentage Rent: Seven percent (7%) of Gross Sales in excess of the
Break(Section 4.3)
1.11 Marketing Assessment: Sixteen Thousand Six Hundred Eighty-Five and
13(Sectionl8.2)($16,685.13) per annum.
1.12 Addresses for Notices: (Article 23)
To Landlord: THE OAKS SHOPPING CENTER, L.P.
c/o TrizecHahn Centers
0000 Xx Xxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000-0000
Attn: Legal Department
and to: Landlord's manager at the Shopping Center.
To Tenant: TOYS INTERNATIONAL
000 Xxxxxxxxx Xxxxx
Xxx Xxxxxx, XX 00000
Attn: President
1.13 Permitted Use: Primarily for the retail sale of toys and, at Tenant's
optio(Sectionn9.1)o the extent incidental to the primary operation of a toy
store), better quality collectibles, hobbies, arts and crafts, children's books,
dolls, model kits (provided that the display of such model kits shall not exceed
twenty-five percent (25%) of the retail sales Floor Area of the Premises),
child-oriented games, child-oriented video and audio cassettes, child-oriented
compact and laser discs, and other technological innovations thereof,
child-oriented computer software, sporting goods, wheel goods, stuffed animals,
other juvenile and child-related goods, and such other items as are typically
displayed in toy stores located within first-class regional shopping centers.
Tenant shall use the Premises for no other use or purpose.
1.14 Security Deposit: Thirty-Three Thousand Three Hundred Sixty-Eight and
75/1(Articler26)$33,368.75).
The provisions of this Article 1 summarize certain terms of the Lease which
are more fully described in the balance of the Lease. In the event of a conflict
between the provisions of Article 1 and the balance of the Lease, the latter
shall control. Capitalized terms used in the Lease shall have the meanings set
forth or cross-referenced in Exhibit B or otherwise defined in the body of the
Lease.
ARTICLE 2
PREMISES
2.1 Condition. Tenant accepts the Premises in its "as-is" condition and
state of repair as of the Commencement Date. Tenant, at its sole cost and
expense, shall complete any Improvements that may be required for Tenant's use
of the Premises. All such work shall be in accordance with Article 11, and
Landlord shall have no responsibility to do or pay for the same.
2.2 Title of Premises. Tenant acknowledges that Tenant's leasehold interest
in the Premises is subject to (a) covenants, conditions, restrictions,
easements, Mortgages, and other matters of record, (b) the REA, (c) the effect
of all Legal Requirements, including any local zoning laws; and (d) general and
special taxes not delinquent. Landlord warrants that none of the matters
contained in the REA and/or the Mortgage shall adversely affect the Permitted
Use.
2.3 Delay in Delivery. If Landlord cannot deliver possession of the
Premises to Tenant on the Target Delivery Date for any reason, Landlord shall
not be subject to any liability therefor. Such failure of delivery shall not
affect the validity of the Lease or the obligations of Tenant hereunder, or
extend the Expiration Date. If Landlord is unable to deliver possession of the
Premises to Tenant within ninety (90) days after the Target Delivery Date for
any reason (including without limitation Landlord's inability to terminate any
existing occupancy of the Premises) then Landlord, in its sole and absolute
discretion, shall have the option at any time thereafter, but prior to
delivering possession of the Premises, to notify Tenant of Landlord's intent to
terminate the Lease in which event the Lease shall terminate and both Landlord
and Tenant shall be released from any liability or obligation under the Lease.
Landlord shall use reasonable efforts to deliver possession of the Premises
to Tenant on or before the Target Delivery Date. If Landlord is delayed in
delivering the Premises by such date, the Rent Commencement Date shall be
delayed by the corresponding number of days after the Target Delivery Date until
possession of the Premises is delivered.
If Landlord is delayed in delivering the Premises by August 15, 1998 and
such delay results in Tenant failing to open for business in the Premises by
December 1, 1998 providing Tenant has made reasonable efforts to open by
December 1, 1998, the Minimum Annual Rental set forth in Article 1 shall be
adjusted to the lesser of (i) seven percent (7%) of Tenant's Gross Sales to be
paid monthly in arrears on or before the twentieth (20th) day of each month, or
(ii) the Minimum Annual Rental set forth in Article 1 (such adjustment shall
hereinafter be referred to as "Tenant's Adjustment Right"). Tenant's Adjustment
Right shall automatically expire April 1, 1999 at which time Tenant shall pay
the full Minimum Annual Rental set forth in Article 1.
Tenant's Adjustment Right as provided for in this Section 2.3 shall be
Tenant's sole remedy at law or in equity in the event of the aforementioned
delay in delivery. It is further agreed and understood that Landlord shall not
be liable for any damages arising from any such delay. In the event the Minimum
Annual Rental is adjusted as provided for herein, Tenant shall still be required
to pay all other charges, including Percentage Rent, called for in the manner
provided for in this Lease. For the purpose of computing Percentage Rent due
during the adjustment period, it shall be deemed that all abated Minimum Annual
Rent was in fact paid to Landlord.
2.4 Relocation or Termination. If in connection with Landlord's expansion,
reduction, removal, renovation or construction of new or existing improvements
(but excluding reconfiguration required solely to accommodate other Shopping
Center tenants) Landlord reasonably determines that it is necessary that Tenant
vacate the Premises or that the Premises be altered, Landlord may require that
Tenant surrender possession of the Premises, provided Landlord, in its sole and
absolute discretion , either (a) amends this Lease to lease Tenant other
comparable premises within the Shopping Center on the same terms and conditions
as those contained in this Lease for the balance of the remaining Lease Term, or
(b) terminates this Lease and pays Tenant an amount equal to the then
unamortized net cost to Tenant of its Improvements, calculated using a
straight-line amortization schedule and an amortization period equal to the
Lease Term. The relocation of the Premises in accordance with (a) herein or the
payment of the consideration in accordance with (b) herein shall be Tenant's
sole remedy in the event Tenant is required to surrender possession of the
Premises as provided in this Section. It is expressly agreed and understood that
Landlord shall first offer to lease Tenant other comparable premises within the
Shopping Center if available, in Landlord's sole, yet reasonable discretion. The
foregoing provisions of this Section 2.4 shall be subject to the following:
(a) Comparable premises shall be deemed to mean premises which are
substantially the same in size (not less than 5,070 square feet or more than
5,600 square feet in size and having a mall frontage of 45 feet or more) and
similar in location with respect to vertical transportation within the Shopping
Center; provided, however, in no event shall Landlord be obligated to offer to
Tenant any location which Landlord is prevented from leasing to Tenant pursuant
to covenants of Landlord respecting radius, location, use, or exclusivity
contained in any other lease, financing agreement (including the Mortgage), or
other agreement affecting the Shopping Center. If more than one (1) comparable
premises is available in the Shopping Center as determined by Landlord's sole,
yet reasonable judgement, Landlord shall offer Tenant the comparable premises
that is closest to the Premises. Landlord shall pay the cost and expense of
finishing the new premises to the extent of the quality and condition of the
decor (including all Improvements but excluding Personal Property) which existed
in the Premises immediately prior to relocation;
(b) Landlord shall give Tenant at least ninety (90) days notice of
Landlord's intention to relocate the Tenant;
(c) Landlord shall not have the right to relocate the Tenant more than one
(1) time during the Lease Term and in no event shall relocation occur from
November 1st through January 31st;
(d) The physical relocation of Tenant's Personal Property from the Premises
to the new premises shall be accomplished by Landlord at Landlord's cost and
expense;
(e) Landlord shall exercise due diligence in the relocation of the Tenant
and Minimum Annual Rental and Additional Rent shall xxxxx during any period that
the business conducted upon the Premises must be closed as a result of such
relocation, which closure shall not exceed seven (7) days;
(f) If the new premises differ in size from the Premises as it existed
before the relocation, Minimum Annual Rental shall be adjusted to a sum computed
by multiplying the Minimum Annual Rental by a fraction, the numerator of which
shall be the total number of square feet in the new premises and the denominator
of which shall be the total number of square feet in the Premises before
relocation. In addition, all Additional Rent which is calculated based on Floor
Area shall be calculated on the basis of the Floor Area of the new premises;
(g) The parties shall immediately execute an amendment to this Lease
documenting the relocation of the Tenant and the reduction or increase in
Minimum Annual Rental;
(h) All incidental costs incurred by Tenant as a result of the relocation
including without limitation, costs incurred in change of address on stationery,
business cards, directories, advertising, and other such items, shall be paid by
Landlord, in a sum not to exceed Seven Hundred Fifty Dollars ($750); and
(i) If Tenant (in its sole and absolute discretion) and Landlord are unable
to agree upon comparable premises for the purposes of relocation pursuant to
this Section 2.4 within thirty (30) days of Landlord's notice to Tenant of its
intent to relocate Tenant, then this Lease shall terminate and Landlord shall
compensate Tenant for its reasonable damages. For purposes of this Section 2.4,
reasonable damages shall be defined as the unamortized net cost to Tenant of its
Improvements with a straight-line amortization period equal to the Lease Term as
of the date of termination.
2.5 Reserved Easement. Landlord shall have the right during the Lease Term
to install, relocate, maintain, and operate conduits, facilities, and structures
comprising the Air Conditioning System and permitting the conveyance of
Utilities in and through the space above the ceiling (or ceiling line if there
is no ceiling) in the Premises. If Landlord desires to relocate any such
conduits, facilities or structures, Tenant shall have the right to approve such
relocation, which approval shall not be unreasonably withheld so long as such
items remain above the ceiling or ceiling line. Landlord further reserves the
right to use up to one percent (1%) of the Floor Area of the Premises as
Landlord may designate at any time to accommodate items serving other tenants or
resulting from the remodeling or expansion of the Shopping Center, including
without limitation columns, shafts, ducts, and pipes, provided such portion is
located adjacent to a wall other than the storefront and such items are either
not visible from the Premises sales area or are reasonably concealed in a manner
which does not materially detract from the appearance of Tenant's store.
2.6 Right to Enter. Landlord and/or its authorized representatives shall
have the right to enter the Premises at all reasonable times for the purpose of
showing the Premises to prospective purchasers or lenders. Tenant additionally
shall permit Landlord, or its authorized representatives, to enter the Premises
at all times during usual business hours upon reasonable notice (except in the
case of an emergency, in which case Landlord may enter as reasonably necessary)
to inspect the Premises, to perform its duties under the Lease, and to perform
any work therein (a) that may be necessary to comply with Legal Requirements,
(b) that Landlord may deem necessary to prevent waste or deterioration of the
Premises or Shopping Center, and (c) that Landlord may deem necessary in
connection with the expansion, reduction, remodeling or renovation of any
portion of the Shopping Center. Landlord agrees that it shall use reasonable
efforts to perform any work it is required or permitted to perform under this
Section 2.6 in such manner and at such times as to not unreasonably or
materially disturb Tenant's business operations, except in the case of an
emergency. In the event work is performed by Landlord in accordance with this
Section 2.6, except to the extent such work was caused by Tenant's failure to
perform its obligations under the Lease, and said work renders the Premises
untenantable for a period of at least three (3) consecutive days, thereafter
Minimum Annual Rent and Additional Rent (except Percentage Rent) shall be abated
proportionately with the degree in which Tenant's use of the Premises is
impaired and such abatement shall continue during the period in which Tenant is
unable to operate its business in the Premises as a result of such work.
2.7 Right to Measure Floor Area of Premises. Within thirty (30) days
following delivery of possession of the Premises to Tenant, Tenant, at its sole
cost and expense, or Landlord, at its sole cost and expense, may cause the Floor
Area of the Premises to be measured by a licensed architect. In the event such
calculation reflects a deviation of more than one percent (1%) from the Floor
Area set forth in Section 1.4, and the other party approves the calculation,
this Lease shall be amended to reflect the recalculated Floor Area and to
proportionately adjust Minimum Annual Rent and the Marketing Assessment. If the
parties do not exercise their right to measure the Floor Area as provided
herein, both Landlord and Tenant hereby acknowledge and agree that each party
shall be deemed to have (i) absolutely and unconditionally waived such right,
(ii) accepted the Floor Area calculation as set forth in Section 1.4, and (iii)
unconditionally released and waived any rights the parties may have against one
another in the event the Floor Area calculation set forth in Section 1.4 is
inaccurate.
ARTICLE 3
LEASE TERM
3.1 Duration. The Lease shall become fully effective and binding as of the
Effective Date. The "Lease Term" means that period commencing on the
Commencement Date and continuing through the Expiration Date, unless sooner
terminated as provided in the Lease or by law.
3.2 Surrender of the Premises. At the Expiration Date or earlier
termination of the Lease, Tenant shall remove all Personal Property from the
Premises and surrender possession of the Premises to Landlord in broom clean
condition and good state of repair, except ordinary wear and tear, damage or
destruction covered by Article 18, and any repair Landlord is obligated to
perform pursuant to the Lease.
3.3 Failure to Surrender Possession and Liquidated Damages. Landlord and
Tenant acknowledge and agree that any failure of Tenant to surrender possession
of the Premises on the Expiration Date or earlier termination of the Lease shall
result in substantial damages to Landlord, and that those damages are and will
be impossible or impracticable to measure. Accordingly, if Tenant does not
surrender possession of the Premises to Landlord as set forth herein, Tenant
shall be deemed a hold over tenant at sufferance . During the period of any such
hold over tenancy, Tenant shall pay to Landlord, as liquidated damages, for each
day that Tenant holds over in the Premises, an amount equal to two (2) times the
portion of the Minimum Annual Rent payable during the last month of the Lease
Term, plus an amount equal to the Additional Rent (including Percentage Rent)
which was payable by Tenant in the last full calendar year prior to the
Expiration Date or earlier termination of the Lease, prorated on the basis of a
365-day year; provided, however, that Tenant's obligation to pay such liquidated
damages shall not commence until the tenth (10th) day following Landlord's
notice to Tenant stating Landlord's intent to enforce the provisions of this
Section 3.3 and until the commencement of such liquidated damages, Tenant shall
pay the Minimum Annual Rent and Additional Rent as payable by Tenant in the last
full calendar year prior to the Expiration Date or earlier termination of this
Lease. No provision of the Lease shall be deemed to permit Tenant to retain
possession of the Premises after the Expiration Date or earlier termination of
the Lease without Landlord's prior written consent. Except as otherwise
specifically stated in the Lease, all of the terms and conditions of the Lease
shall remain in effect following any extension, renewal or hold over of the
original Lease Term.
ARTICLE 4
RENT
4.1 Rent Commencement Date. Tenant's obligation to pay Minimum Annual Rent
and Additional Rent shall commence upon the Rent Commencement Date.
4.2 Minimum Annual Rent. Tenant shall pay Minimum Annual Rent in twelve
(12) equal monthly installments during the Lease Term, in advance, on the first
day of each calendar month, without setoff, deduction, prior notice or demand.
In the event that at any time after the Effective Date an additional Major
Department Store containing at least sixty-five thousand (65,000) square feet of
Floor Area and having an entrance abutting the enclosed mall, other than those
shown on Exhibit A, is constructed in the Shopping Center, then as of the date
of the initial opening of such Major Department Store, the Minimum Annual Rent
as set forth in Article 1 shall be increased by ten percent (10%), provided such
increase does not occur more than once during the Lease Term.
4.3 Percentage Rent.
(a) In General. Tenant shall pay Percentage Rent for each partial or full
calendar year of the Lease Term calculated based on Gross Sales for such period.
Said payments of Percentage Rent shall commence with the calendar month in
which Tenant's Gross Sales first exceed the Breakpoint for such full or partial
calendar year. Said payments shall equal that amount which is the product of the
Percentage Rent figure (specified in Article 1) multiplied by the amount of
Gross Sales in excess of the Breakpoint. Said payments shall be payable
concurrently with Tenant's submittal of the monthly statements of Gross Sales in
accordance with the provisions of Section 4.3(b). Anything to the contrary
notwithstanding, in the event Minimum Annual Rent is abated in accordance with
any provisions of the Lease, the Breakpoint shall be adjusted accordingly.
The total Percentage Rent due and payable for a calendar year shall be
computed based on Tenant's annual statement of Gross Sales for that year and if
Tenant paid an amount greater than the actual Percentage Rent payable, the
amount of such overpayment shall be credited against Tenant's next required
payment of Additional Rent or, at the end of this Lease Term, receive a refund
thereof from Landlord, provided Tenant is not otherwise in monetary default
under the terms of this Lease and no other amounts are owed to Landlord; if
Tenant paid an amount less than the required Percentage Rent, then Tenant shall
pay such difference to Landlord together with Tenant's annual statement of Gross
Sales for said calendar year.
Notwithstanding anything to the contrary contained in this Section 4.3, for
the purpose of computing Percentage Rent due for a partial calendar year
occurring at the beginning of the Lease Term, Gross Sales made during that
partial year shall be added to the Gross Sales made during the first full
calendar year after the Rent Commencement Date and said payments of Percentage
Rent shall commence with the calendar month in which Tenant's Gross Sales first
exceed the Breakpoint for this entire period
(b) Reporting of Gross Sales. Tenant agrees to furnish to Landlord a
statement of Gross Sales within twenty (20) days after the close of each
calendar month, and an annual statement, including a monthly breakdown of Gross
Sales, within forty-five (45) days after the close of each calendar year during
the Lease Term and any partial calendar year at the end of the Lease Term;
provided, however, that Tenant shall cause its store manager to orally transmit
to Landlord monthly Gross Sales within ten (10) days after the close of each
calendar month and annual Gross Sales within thirty (30) days after the close of
each calendar year. It is agreed, however, that should Tenant fail twice during
the Lease Term to submit its written report of monthly and/or annual Gross Sales
within the time periods as provided for herein, then Tenant shall, for the
remainder of the Lease Term, be required to submit its written monthly
statements of Gross Sales within ten (10) days after the close of each calendar
month and to submit its written annual statements of Gross Sales within thirty
(30) days after the close of each calendar year. Such statements shall itemize
all elements of Gross Sales and Gross Sales Adjustments, and shall be certified
as true and correct by a Responsible Officer of Tenant. The receipt by Landlord
of any statement or any payment of Percentage Rent for any period shall not bind
Landlord as to the correctness of such statement or payment. Upon request,
Tenant agrees to furnish to Landlord a copy of Tenant's state and local sales
and use tax returns, if required in the state where the Shopping Center is
located, but only to the extent such returns are limited to the business
conducted upon the Premises. Tenant shall record at the time of sale, in the
presence of the customer, all receipts from sales or other transactions using a
cash register or computer system that cumulatively numbers and records all
receipts. Tenant and its subtenants, licensees, and concessionaires, shall keep
(i) full and accurate books of account and records in accordance with generally
accepted accounting principles consistently applied, including without
limitation, a sales journal, general ledger, and all bank account statements
showing deposits of Gross Sales revenue, (ii) all cash register detail tapes
with regard to all transactions of Gross Sales, and (iii) detailed original
records of all Gross Sales Adjustments. Such books, receipts, and records shall
be kept by Tenant for a period of three (3) years after the close of each
calendar year and during such 3-year period shall be available for inspection
and audit by Landlord and its representatives at the Premises or Tenant's
principal place of business at all times during regular business hours upon no
less than twenty (20) days prior notice. It is agreed, however, that Landlord's
right to inspect or audit shall be limited to once every calendar year, provided
(i) that in the event any audit reveals an understatement of annual Gross Sales
of more than two percent (2%), said limit shall thereafter be inapplicable, and
(ii) that in the event any audit shall result in a dispute between Landlord and
Tenant, and such dispute may be resolved by another audit, Landlord shall be
entitled to a second audit. Any corrections or adjustments to Gross Sales
previously reported by Tenant which will result in a refund to Tenant must be
reported to Landlord within the three (3) year period following the end of the
calendar year in which such Gross Sales were made. If it shall be determined as
a result of an audit that there has been a deficiency in the payment of
Percentage Rent, then such deficiency shall become immediately due and payable
with interest at the Interest Rate from the date when said payment was due or if
such audit determines that there has been an overpayment of Percentage Rent the
amount of such overpayment shall be credited against Tenant's next required
payments of Additional Rent. In addition, if Tenant understates annual Gross
Sales by more than three percent (3%) and if Landlord is entitled to any
additional Percentage Rent as a result, or if an audit shows that Tenant has
failed to maintain the books of account and records as required or fails to
appear for and/or cooperate with Landlord's audit representative and, as a
result, Landlord is unable to verify the accuracy of Tenant's statement, then
Tenant shall pay to Landlord all reasonable costs and expenses incurred by
Landlord in conducting such audit and collecting any underpayment. Any
information gained from such audits, statements or inspection shall be
confidential and shall not be disclosed other than to carry out the purpose
hereof; provided, however, Landlord shall be permitted to divulge the contents
of any such statements in connection with any contemplated sales, transfers,
assignments, encumbrances or financing arrangements of Landlord's interest in
the Premises or in connection with any administrative or judicial proceedings in
which Landlord is involved where Landlord may be required to divulge such
information.
(c) New Locations. If during the Lease Term, Tenant, or any director or
officer of Tenant, or any parent, subsidiary or other affiliate of Tenant,
directly or indirectly, operates or owns either (i) under Tenant's Trade Name or
otherwise any similar type of business (except for stores operated under the
trade name "Play Co." as hereinafter provided) not so operated or owned on the
date Landlord executed the Lease within a radius of ten (10) miles from the
location of the Shopping Center, or (ii) under the trade name "Play Co.", not so
operated or owned on the date Landlord executed the Lease within a radius of
three (3) miles from the location of the Shopping Center, Landlord shall, and
continuing while Tenant is operating said other business, include the Gross
Sales of such other business in the Gross Sales made from the Premises for the
purpose of computing the Percentage Rent due hereunder. Tenant will provide
Landlord with a statement of Tenant's Gross Sales, in accordance with the
provisions of Section 4.3(b) for each such business location operated by Tenant
within said radius.
(d) Mutual Right to Terminate Based on Gross Sales. Landlord or Tenant
shall have a one (1) time right to terminate this Lease by written notice to the
other party, which notice must be given, if at all, during the first ninety (90)
days following the thirty-sixth (36th) full calendar month of the Lease Term.
Such termination shall be effective on the ninetieth (90th) day after such
notice is given. This right to terminate shall be null and void in the event
Tenant's Gross Sales exceed One Million Six Hundred Two Thousand Dollars
($1,602,000) during any one of the first three (3) years (year being defined as
twelve [12] consecutive full calendar months) of the Lease Term and, further,
Tenant's right to terminate shall be null and void in the event Tenant is in
default of this Lease, beyond any applicable cure period, as of the date of the
termination notice.
4.4 Additional Rent. Tenant shall pay all Additional Rent without setoff,
deduction, prior notice or demand in the amounts and in the manner set forth in
the Lease.
Tenant's payments of Additional Rent pursuant to Articles 5, 6, and 7 shall
be payable in the following manner:
(a) Estimate. Commencing with the Rent Commencement Date and continuing
throughout the balance of the Lease Term, Tenant shall pay Landlord, on the
first day of each calendar month, those amounts Landlord estimates to be
Tenant's share of the aforementioned Additional Rent. Landlord may adjust such
monthly estimates at the end of any calendar quarter on the basis of Landlord's
experience and reasonably anticipated costs.
(b) Reconciliation. Following the end of each calendar year or property tax
installment period, as applicable, Landlord shall furnish Tenant separate
statements for the Additional Rent payable by Tenant pursuant to Articles 5, 6,
and 7. Such statements shall cover the billing period showing the total of the
applicable Additional Rent expenses, Tenant's share of such expenses for such
billing period, and the total prior amounts payable by Tenant with respect to
such period in accordance with subsection (a) of this Section. Upon written
request, Landlord will provide Tenant with the method of calculation of Tenant's
share. If Tenant's share of the Additional Rent expenses exceeds the total of
Tenant's payments with respect thereto, Tenant shall pay Landlord the deficiency
within thirty (30) days after receipt of such statement. If said payments exceed
Tenant's share of the specified Additional Rent expenses, such excess shall be
offset against the payments next due Landlord for the same Additional Rent
expense with a refund of any excess remaining at the expiration or earlier
termination of the Lease Term except to the extent Tenant is in monetary default
under this Lease. If it shall be determined as a result of an audit that there
has been an overpayment in the payment of Additional Rent due to Landlord's
miscalculation of the year end reconciliation, then such overpayment shall be
credited to Tenant's next payment of Additional Rent with a refund of any excess
remaining at the expiration or earlier termination of the Lease Term except to
the extent Tenant is in monetary default under this Lease.
(c) Tenant's Right to Audit. Provided Tenant is not in default under any
provision of this Lease after notice and expiration of the applicable cure
period, if any, provided for in Article 16, within twelve (12) months after the
receipt by Tenant of the annual statement with respect to any item of Additional
Rent for a calendar year, or tax year, if applicable with respect to taxes,
Tenant may, upon no less than thirty (30) days' prior written notice to
Landlord, audit Landlord's books pertaining to such Additional Rent payable by
Tenant pursuant to Articles 5, 6, and 7 for such calendar year or tax year, as
the case may be. Tenant's audit shall be performed by a certified public
accountant who is retained strictly on a non-contingency basis. The audit shall
be conducted at the office designated by Landlord and shall be during usual
business hours. Tenant's right to audit shall be restricted to one (1) per
calendar year and shall be at the sole cost and expense of Tenant. In no event
shall Tenant's right to audit relieve Tenant of its obligation to pay all
amounts due as provided in this Lease. Tenant shall deliver a copy of the
results of such audit to Landlord within fifteen (15) days of its receipt by
Tenant. Any information gained from such audit shall be confidential and shall
not be disclosed by Tenant, its agents and/or employees except to Tenant's
attorneys, accountants, and consultants or in connection with any contemplated
assignments or in connection with any administrative or judicial proceedings in
which Tenant may be required to divulge such information.
(d) Payment Directly to Third Party. Landlord, in its sole and absolute
discretion, shall have the option to require that the Tenant pay the reasonable
costs of certain services directly to the provider of such services. In such
event, such costs shall not be payable to Landlord as provided in the applicable
provision of the Lease unless Tenant fails to pay any such amount when due. If
Tenant fails to pay any such amount when due and such failure continues for ten
(10) days after Tenant' receipt of notice thereof from Landlord, Landlord shall
have the right, but not the obligation, to pay such amount on behalf of Tenant
and Tenant shall, upon demand, pay such amount to Landlord plus Landlord's
Administrative Fee.
4.5 Proration of Rent for Partial Month. Rent payable by Tenant for any
partial calendar month at the beginning or end of the Lease Term which is
calculated on the basis of a full calendar year shall be computed on a daily
basis to reflect the actual number of days in said partial month at an amount
equal to one-three hundred sixty-fifth (1/365th) of such annual Rent for each
day of said partial month.
4.6 Landlord's Right to Offset. If any sums are payable by Landlord
pursuant to any provision of the Lease, Landlord shall have the right to first
offset from such sum any amounts that are currently payable by Tenant to
Landlord pursuant to any provision contained in the Lease.
4.7 Failure to Pay Rent When Due. If Tenant fails to pay any amount of
Minimum Annual Rent or Additional Rent within five (5) days of when due, such
unpaid amount shall bear interest at the Interest Rate from the date such sum
was due . In addition, Tenant acknowledges that the late payment by Tenant of
any installment of Minimum Annual Rent or Additional Rent within five (5) days
of when due will cause Landlord to incur certain costs and expenses not
contemplated under this Lease, the exact amount of which costs are extremely
difficult or impracticable to determine. Therefore, if any such installment is
not received by Landlord from Tenant within five (5) days of when due, Tenant
shall immediately pay to Landlord a late charge of Four Hundred Dollars ($400).
Landlord and Tenant agree that such late charge represents a reasonable estimate
of such costs and expenses and is fair compensation to Landlord for its loss
caused by Tenant's late payment.
4.8 Address for Payments. Tenant shall pay all rent and other payments due
Landlord at Landlord's management office in the Shopping Center, or at such
place as Landlord may from time to time designate in writing.
ARTICLE 5 s
PREMISES TAX AND INSURANCE EXPENSES s
Tenant agrees to pay to Landlord (a) the amount of all taxes, similar
assessments, and special assessments levied for any reason on, or attributable
to, the Premises and/or the realty underlying the Premises (whether separately
or as part of a larger parcel as provided in this Article) and reasonable costs
associated with challenging such taxes and assessments and (b) the cost to
Landlord of the insurance required to be maintained by Landlord on the Premises
under Section 13.3. In no event shall Tenant be required to pay: (a) any portion
of Landlord's general income, franchise, inheritance, estate or gift taxes, or
(b) any assessment levied for the purpose of financing Landlord's cost to
develop or construct any portion of the Shopping Center.
With respect to any assessment which may be levied against or upon the
Premises and the Shopping Center, or which under the laws then in force may be
evidenced by improvement bonds or other bonds, and which may be paid in annual
installments, only the amount of such annual installment (with appropriate
proration for any partial calendar year of the Lease Term) shall be including
within the computation of Tenant's pro rata share of taxes and assessments for
any particular year.
Upon Tenant's written request therefor, Landlord will provide Tenant with
copies of applicable tax bills for the immediately preceding tax period or other
information upon which Landlord has relied for its determinations hereunder.
For the purpose of this Article, the term "larger parcel" is such portion
of the Shopping Center containing the Premises and other realty and/or
improvements for which taxes and assessments are levied, but excluding any
portion whose taxes are included in the Common Area Expenses. In the event the
Premises and the realty underlying the Premises are not separately assessed for
computation of taxes and assessments or are separately assessed and billed as
part of a larger parcel then, in either event, taxes and assessments on the
Premises and the realty underlying the Premises shall be that proportion of the
taxes and assessments on such larger parcel which the Floor Area of the Premises
bears to the Floor Area of all the areas available for exclusive use and
occupancy by tenants of such larger parcel, whether or not actually occupied and
open for business, provided that an equitable adjustment shall be made for
buildings which are partially completed on the date such taxes and assessments
are levied.
In the event the cost to Landlord of the insurance covering the Premises is
not separately charged to Landlord, Tenant's share of insurance as set forth
herein shall be the proportion of the total insurance expenses (excluding any
insurance which is included in Common Area Expenses) which the Floor Area of the
Premises bears to the Floor Area of all the areas available for exclusive use
and occupancy by tenants of the Shopping Center, whether or not actually
occupied and open for business, exclusive of Floor Area which is separately
insured.
Tenant shall pay before delinquency all taxes (including sales and use
taxes), assessments, license fees, and public charges levied, assessed or
imposed upon its business operation as well as upon its merchandise,
Improvements, and Personal Property. In the event such items of Tenant's
property are assessed with property of Landlord, Landlord shall allocate such
assessment, on the basis of assessed value or such other reasonable allocation,
between Landlord and Tenant so that Tenant shall pay only its equitable portion.
ARTICLE 6
UTILITIES AND AIR CONDITIONING
6.1 Utilities. Landlord shall make the following Utilities available to the
Premises : sewage removal, delivery of water, electricity, natural gas (if
permitted by Landlord), and telephone service. Landlord shall have no obligation
whatsoever to make any other Utilities available for the benefit of Tenant.
6.2 Utilities Charge. Tenant shall pay the Utilities Charge in accordance
with Section 4.4.
6.3 Calculation of Utilities Charge. The "Utilities Charge" shall be
Tenant's payment of any and all Utilities furnished by Landlord to the Premises
or otherwise for the benefit of Tenant. Tenant shall install at its sole expense
any separate meter required by Landlord or Tenant for any Utilities. If any
Utilities are not separately metered to the Premises and are instead provided in
common with others, then Landlord shall reasonably determine Tenant's share of
the Utilities so provided (not to exceed the rates of the local utility company
if such service had been provided directly to Tenant), and such determination
shall be used in the calculation of the Utilities Charge; provided, however,
that Tenant shall be permitted to install a submeter to monitor Tenant's usage.
Tenant shall use the Utilities provided by Landlord to the Premises throughout
the Lease Term, and shall not contract separately for the same without the prior
written consent of Landlord which Landlord may grant or withhold in its sole and
absolute discretion. The Utilities Charge shall not exceed the charge the local
public utility company would have imposed had said company furnished the
Utilities directly to Tenant. If Landlord does not provide all of the Utilities,
Tenant agrees, at its own expense, to pay to the appropriate utility company the
cost of any such Utilities.
6.4 Air Conditioning. The Air Conditioning System serving the Premises is
either an individual unit serving the Premises exclusively or a centralized
system serving the Premises on a nonexclusive basis.
6.5 Air Conditioning Charge. If the Air Conditioning System exclusively
serves the Premises, Tenant shall have no separate Air Conditioning Charge, but
Tenant shall pay all costs of Utilities used to operate the Air Conditioning
System as part of the Utilities Charge. If the Air Conditioning System is a
centralized system serving the Premises on a nonexclusive basis, Tenant shall
pay the Air Conditioning Charge as provided in Section 4.4.
6.6 Calculation of Air Conditioning Charge. The "Air Conditioning Charge"
shall be Tenant's share of the total expense associated with the operation and
maintenance of the Air Conditioning System (including Amortization of Capital
Items) for any given calendar year and the Administrative Fee with respect to
all such expenses. Initially, such share shall be equal to the proportion that
Tenant's Engineered Value bears to the total of the Engineered Values of all
tenants utilizing the Air Conditioning System during each calendar month of the
calendar year and averaged for that calendar year. Within thirty (30) days after
Tenant opens the Premises for business, Tenant shall submit to Landlord a
certified air balance report stating the amount of CFM actually being used by
Tenant in the Premises. If Tenant fails to submit such certified air balance
report to Landlord within said thirty (30) day period, Landlord may obtain such
a certified air balance report at Tenant's expense, which air balance report as
completed by Landlord shall be binding and conclusive. If the Air Conditioning
System supplies chilled water or other fluid refrigerant to the Premises,
Landlord shall measure the GPM actually being used by Tenant in the Premises on
the basis of the air balance report. Either party may, at any time, install
meters to verify the amount of CFM/GPM used by Tenant. After receipt and
verification of the air balance report and/or the metered CFM or GPM readings,
Landlord shall use such actual CFM or GPM in the foregoing formula, in lieu of
Tenant's Engineered Value.
6.7 Tenant's Engineered Value. Tenant shall not at any time cause an
increase in the Engineered Value without the prior written approval of Landlord.
Upon Landlord's request, Tenant shall submit to Landlord the current
calculations requested under Exhibit F.
ARTICLE 7
COMMON AREA
7.1 Tenant's License to Use. Landlord grants to Tenant and its employees,
agents, customers, and invitees a non-exclusive license to use the Common Area
during the Lease Term, subject to the rights of Landlord, the other tenants of
Landlord, the other owners of the Shopping Center and such parties' employees,
agents, customers, and invitees to use the same in common with Tenant.
7.2 Operation and Maintenance of Common Area. Landlord shall keep the
Common Area in a neat, clean, and orderly condition, and shall repair, maintain
or replace all equipment and facilities thereof as Landlord shall deem
necessary. Landlord may cause any or all of the services concerning the Common
Area to be provided by an independent contractor(s) or by an affiliate(s) of
Landlord. If Landlord does not maintain all of the Common Areas of the Shopping
Center because one or more of the Major Tenants maintains a portion thereof,
then, for so long as such condition exists, Landlord's responsibility hereunder
shall extend to only those portions of the Common Area not maintained by Major
Tenants and the Common Area expenses described in this Article shall refer only
to the portions maintained by Landlord.
7.3 Common Area Expenses.
(a) In General. "Common Area Expenses" shall mean all expenses in
connection with the use, ownership (i.e., property taxes), operation, and
maintenance of the Common Area, including without limitation, all general
maintenance and repairs deemed necessary by Landlord or as may be required by
Governmental Authority; work performed by Landlord in accordance with Section
12.2; resurfacing, restriping, and repair of all parking areas; painting;
cleaning; trash removal; snow and ice removal; sweeping and janitorial services;
seasonal decor; signs; fire protection systems; personnel to implement any of
the foregoing services including, if Landlord deems necessary, the cost of
security officers and security systems; all taxes, similar assessments, and
special assessments levied for any reason on the Common Area and the realty
underlying the Common Area and all reasonable costs associated with challenging
such taxes and assessments; all personal property taxes levied for any reason on
any personalty of the Common Area; the cost to Landlord of the insurance
covering the Shopping Center; the Amortization of Capital Items; all on-site
costs and personnel expenses of Landlord incurred in managing the Shopping
Center; and the Administrative Fee with respect to all such expenses. Common
Area Expenses shall be reduced (prior to the calculation of Tenant's share) by
the contributions required to be made by the Major Tenants thereto, and shall
not include any costs in connection with the original construction and
installation of the Common Area. There shall be no duplication to Tenant of the
costs for insurance and taxes as provided in Article 5 and this Section.
Notwithstanding anything to the contrary contained in this Lease, Tenant
shall not be required to pay its share of any costs which (i) have been
reimbursed to Landlord from insurance proceeds or warranties or eminent domain
award (and to the extent Tenant does pay for any such costs which are
subsequently reimbursed to Landlord, Tenant shall be entitled to a refund), (ii)
are incurred in connection with the expansion or renovation of the Shopping
Center except to the extent such expenses are deferred maintenance expenses or
otherwise appropriate operation and/or maintenance expenses; (iii) are
associated with the removal and/or abatement of Hazardous Materials from
portions of the Shopping Center other than the Premises; or (iv) are incurred by
Landlord pursuant to Section 8.4 of this Lease. Further, Tenant shall not be
required to pay both depreciation and the replacement cost for the same item.
In no event shall Tenant's share of expenses in any calendar year in
connection with any work associated with an Insured Casualty or an Uninsured
Casualty exceed an amount equal to fifteen percent (15%) of Tenant's total share
of Common Area Expenses for such year; provided, however, that commercially
reasonable deductibles, co-insurance, and/or self-insurance funds shall not be
subject to the foregoing limitation so long as the potential exposure to the
Landlord as a result of such deductibles, co-insurance, and/or self insurance
does not exceed an amount equal to 25% of the total replacement cost of the
Shopping Center).
(b) Calculation. Tenant shall pay its share of Common Area Expenses in the
manner provided in Section 4.4. Tenant's share of Common Area Expenses shall be
calculated as follows:
(i) Tenant's share of Common Area Expenses for the previous calendar
quarter or year shall be the proportion of all such expenses, exclusive of
Interior Mall Expenses and Food Court Expenses, that the Floor Area of the
Premises bears to the total Floor Area of all premises in the Shopping Center
that are occupied and open for business as of the commencement of each calendar
quarter and averaged for that calendar year, exclusive of the Floor Area
occupied by the Major Tenants; provided, however, that during the Lease Term, in
no event will Tenant's share of such Common Area Expenses be calculated on the
basis of less than eighty percent (80%) occupancy of the Floor Area of the
Shopping Center, exclusive of the Floor Area occupied by the Major Tenants;
(ii) If the storefront of the Premises is located on the Interior Mall,
Tenant's share of Interior Mall Expenses for the previous calendar quarter or
year shall be the proportion of all Interior Mall Expenses that the Floor Area
of the Premises bears to the Floor Area of all premises having storefronts on
the Interior Mall that are occupied and open for business as of the commencement
of each calendar quarter and averaged for that calendar year, exclusive of the
Floor Area occupied by the Major Tenants; provided, however, that during the
Lease Term, in no event will Tenant's share of such Interior Mall Expenses be
calculated on the basis of less than eighty percent (80%) occupancy of the Floor
Area of premises having store fronts on the Interior Mall, exclusive of the
Floor Area occupied by the Major Tenants; and
(iii) If the Premises is located within the Food Court of the Shopping
Center and the use of the Premises involves the sale of food, Tenant's share of
Food Court Expenses for the previous calendar quarter or year shall be the
proportion of all Food Court Expenses that the Floor Area of the Premises bears
to the Floor Area of all food use tenants within the Food Court that are
occupied and open for business as of the commencement of each calendar quarter
and averaged for that calendar year.
7.4 Extended Hours Services. If Tenant desires to operate its business in
the Premises beyond the normal Shopping Center hours of operation, Tenant shall
request Landlord's permission to do so, which request shall be subject to
Landlord's approval, and thereafter shall notify Landlord of any changes in the
times or dates of the extended hours of operation. Landlord will provide those
extended hours services that it deems necessary and Tenant shall reimburse
Landlord for Tenant's equitable share of the increased costs incurred by
Landlord for such extended hours services, including without limitation
lighting, security, Utilities, and Landlord's Administrative Fee with respect to
all such expenses. Tenant shall pay such increased costs as part of Additional
Rent in accordance with Section 4.4.
7.5 Control of Common Area. Landlord shall at all times have the right to
determine the nature and extent of the Common Area, whether the same be surface,
underground or multiple-deck, and to make such changes thereto as it shall
elect, including without limitation the location and relocation of driveways,
entrances, exits, and automobile parking spaces, the direction and flow of
traffic, and the installation of prohibited areas, landscaped areas and Utility
Installations. Landlord shall at all times have the sole and exclusive control
of the Common Area, including, without limitation, the right to lease space
within the Common Area to tenants for the sale of merchandise and/or services
and the right to permit advertising displays, educational displays and
entertainment in the Common Area, including kiosks, carts, and other temporary
or permanent stands. Landlord's control and operation of the Common Area shall
at all times be subject to Landlord's obligation to comply with all Legal
Requirements. Landlord shall also have the right at any time and from time to
time to exclude and restrain any person from the use or occupancy of the Common
Area. It shall be the duty of Tenant to keep all of the Common Area free and
clear of any obstructions created or permitted by Tenant or resulting from
Tenant's operation. However, no permanent facility which materially and
adversely affects the access to or visibility of the Premises shall be located
within ten feet (10') directly in front of Tenant's Premises as limited by an
imaginary ten foot (10') extension of Tenant's Interior Demising Partitions
without Tenant's prior consent.
7.6 Security Officers. Tenant acknowledges that if Landlord provides
security officers for the Common Area, Landlord does not represent, guarantee or
assume responsibility that Tenant will be secure from any Claims relating to
such security officers. Landlord shall have no obligation to hire, maintain or
provide such services, which may be withdrawn or changed at any time with or
without notice to Tenant or any other person and without liability to Landlord.
7.7 Rules and Regulations. In addition to any rules and regulations of
record governing the Shopping Center, Tenant shall abide by the rules and
regulations set forth in Exhibit D. Landlord shall have the right to establish
additional reasonable and equitable rules and regulations, and to adopt
reasonable and equitable amendments to the same from time to time for the proper
and efficient operation and/or maintenance of the Common Area or any portion
thereof, as Landlord determines in its discretion.
7.8 Validated Parking. Landlord shall have the right to adopt a
nondiscriminatory, uniform policy, charge and/or validation system for the
parking facilities in the Common Area.
ARTICLE 8
MARKETING ARTICLE
8.1 Marketing. Tenant shall, at Landlord's option, either participate in a
marketing fund ("Marketing Fund") or a merchants' association ("Merchants'
Association") which shall be organized to market the Shopping Center. Landlord
shall control and administer the Marketing Fund, if established, with advice
from an advisory group comprised of representatives of various Shopping Center
tenants. The activities of the Marketing Fund or the Merchants' Association, as
the case may be, shall be financed by an annual budget based on an appropriate
fiscal year. The annual budget shall be the sum of the following: the annual
marketing assessments of all tenants at the Shopping Center; plus the
contributions of Landlord as provided in this Article and of all Major
Department Stores pursuant to their separate agreements with Landlord.
8.2 Tenant's Marketing Assessment. Tenant shall pay the Marketing
Assessment to Landlord if Landlord has established the Marketing Fund, or as
dues to the Merchants' Association if Landlord has not established the Marketing
Fund. Tenant shall pay the Marketing Assessment in equal monthly installments,
payable in advance commencing on the Rent Commencement Date and thereafter on
the first day of each calendar month of each year. Tenant's Marketing Assessment
shall be adjusted annually in accordance with the CPI Adjustment Procedures;
provided, however, in no event shall the Marketing Assessment increase in any
year by more than five percent (5%) over the Marketing Assessment for the
previous year. The Base Month shall be the month of October immediately
preceding the Rent Commencement Date; the Month of Adjustment shall be the month
of October during each fiscal year of the Lease Term thereafter. The adjustment
shall be effective as of the first day of January following the Month of
Adjustment.
8.3 Landlord's Contribution. Landlord shall contribute on a noncumulative
basis an amount equal to twelve and one-half percent (12.5%) of the total
contributions by all tenants of the Shopping Center (including contributions, if
any, made by the Major Department Stores) to the Marketing Fund; provided,
however, in no event shall Landlord be required to contribute more than
Twenty-Five Thousand Dollars ($25,000) in any fiscal year. At Landlord's option,
Landlord may elect to contribute part or all of the marketing and graphic arts
services required by the Marketing Fund or the Merchants' Association in lieu of
making its contribution in cash. In any event, Landlord shall maintain the sole
and absolute authority to employ and discharge any member of its marketing and
graphic arts staffs providing said services.
8.4 Daily Sales. Landlord may, in its sole and absolute discretion, provide
a program for the purpose of collecting daily sales information directly from
the Tenant via Tenant's designated representative at the Premises and Tenant
agrees to participate in any such program. The daily sales information would
include gross daily receipts collected at the Premises. The program shall be in
the form of automated, computerized telecommunication. The costs and expenses in
connection with the operation of the program would be paid for either by the
Landlord or by proceeds from the Marketing Fund. The information collected may
be utilized by Landlord for the purpose of evaluating and responding to market
trends and determining merchandising category rankings.
ARTICLE 9
USE
9.1 Permitted Use. Tenant shall operate the Premises only under Tenant's
Trade Name and shall only use the Premises for the Permitted Use, and for no
other use or purpose. Landlord shall not unreasonably withhold its consent to a
change in Tenant's Trade Name in connection with an approved Occupancy
Transaction.
9.2 Duties and Prohibited Conduct. Tenant shall at all times comply with
all Legal Requirements. At Tenant's sole expense, Tenant shall procure,
maintain, and make available for Landlord's inspection any governmental license
or permit required for the proper and lawful conduct of Tenant's business.
Tenant shall not use the Premises, or permit or fail to prevent the Premises to
be used, (a) for any purpose or in any manner that violates any Legal
Requirement and/or the requirements of the insurance underwriter(s) for the
Shopping Center, (b) for the sale or display of pornography, nudity, graphic
violence, drug paraphernalia, or any goods and/or services that, in the sole and
absolute discretion of Landlord, are inconsistent with the image of a community
or family-oriented shopping center, (c) as a massage parlor, adult bookstore or
second-hand store, (d) to conduct an auction, distress, fire, bankruptcy or
going-out-of business sale or similar sales, (e) to sell merchandise from
vending machines (except vending machines installed and made available solely
for use by Tenant's employees), (f) to operate any video, pinball or other
gaming machines, although Tenant shall be allowed to display and demonstrate to
customers and/or allow customers to operate items which Tenant has for sale, or
(g) to keep live animals of any kind unless otherwise permitted by this Lease.
Tenant shall not place, affix or maintain any signs, advertising placards,
names, insignia, trademarks, descriptive material or any other similar item or
items outside, on or within twenty-four inches (24") of the Lease Line, the
storefront, the glass panes and supports of the show windows, or any window,
door, roof or the exterior side of any Perimeter Demising Partition of the
Premises, except such signs as Landlord shall approve in writing in accordance
with Exhibit C. Tenant shall use the sales Floor Area within six feet (6') of
the storefront Lease Line, if at all, for the promotional display of merchandise
only; stacking or stocking merchandise within said area or in the window area is
expressly prohibited. Tenant shall not cause or permit any waste to occur in the
Premises and shall not overload the floor, or any mechanical, electrical,
plumbing or Utility systems serving the Premises. Tenant shall keep the
Premises, and every part thereof, in a clean and wholesome condition, free from
any objectionable noises, loud music, odors or nuisances. If the Permitted Use
includes the sale of and/or preparation of food, Tenant shall at all times
maintain a health department rating of "A" (or such other highest health
department or similar rating as is available).
9.3 Hazardous Materials.
(a) In General. Tenant shall not use, generate, manufacture, produce,
store, transport, treat, dispose or permit the escape or release on, under,
about or from the Premises, or any part thereof, of any Hazardous Materials. If
Tenant's Permitted Use requires the use and/or storage of any Hazardous
Materials on, under or about the Premises, Tenant shall provide written notice
to Landlord, prior to final execution of the Lease, of the identity of such
materials and Tenant's proposed plan for the use, storage, and disposal thereof;
such use, storage, and disposal shall be subject to Landlord's approval, in
Landlord's sole and absolute discretion. If Landlord approves such proposed use,
storage, and disposal of specific Hazardous Materials, Tenant may use and store
upon the Premises only such specifically approved materials and shall comply
with any conditions to such approval as Landlord may impose in its sole and
absolute discretion. Landlord's permission hereunder may be withdrawn or
modified at any time in Landlord's sole and absolute discretion. Tenant shall
fully and promptly comply with all Hazardous Materials Laws at all times during
the Lease Term, and at the expiration or earlier termination of the Lease Term,
Tenant shall remove and dispose of all Hazardous Materials affecting the
Premises and the Shopping Center resulting from the use or occupancy thereof by
Tenant or its agents, employees, suppliers, contractors, subtenants, successors,
and assigns regardless of whether such removal is required by any Hazardous
Materials Law. Notwithstanding the foregoing, Landlord consents to Tenant's
above-ground use, storage, and off-site disposal of products containing small
quantities of Hazardous Materials, which products are of a type customarily used
in operations specifically mentioned as a Permitted Use, provided that Tenant
shall handle, use, store, and dispose of such Hazardous Materials in a safe and
lawful manner and shall not allow Hazardous Materials to contaminate the
Premises or the Shopping Center.
(b) Indemnity. Tenant shall indemnify, protect, defend, and hold Landlord
(and its partners, joint venturers, shareholders, affiliates, and property
managers, and their respective officers, directors, employees, and agents) and
Landlord's Mortgagee harmless from and against any and all Claims arising out
of, in connection with, or directly or indirectly arising out of the use,
generation, manufacture, production, storage, treatment, release, disposal or
transportation of Hazardous Materials by Tenant, or any successor, assignee or
sublessee of Tenant, or their respective agents, contractors, employees,
licensees, or invitees, on, under, about or from the Premises or the Shopping
Center, including, but not limited to, all foreseeable and unforeseeable costs,
expenses, and liabilities related to any testing, repair, cleanup, removal
costs, detoxification or decontamination and the preparation and implementation
of any closure, remedial action, site assessment costs or other required plans
in connection therewith deemed required, necessary or advisable by Landlord or
any Governmental Authority, and any foreseeable or unforeseeable consequential
damages. Any defense of Landlord pursuant to the foregoing indemnity shall be by
counsel reasonably acceptable to Landlord. Neither the consent by Landlord to
the use, generation, storage, release, disposal or transportation of Hazardous
Materials, nor Tenant's strict compliance with all Hazardous Materials Laws,
shall excuse Tenant from Tenant's indemnification obligations hereunder. The
foregoing indemnity shall be in addition to and not a limitation of the other
indemnification provisions of the Lease. Tenant's obligations hereunder shall
survive the termination or expiration of the Lease.
(c) Reporting. Tenant shall notify Landlord in writing, promptly after any
of the following: (i) Tenant has knowledge, or has reasonable cause to believe,
that any Hazardous Materials have been released, discharged or located on, under
or about the Premises or, to the extent caused by Tenant, the Shopping Center,
whether or not the same is in quantities that would otherwise be reportable to a
public agency, (ii) Tenant receives any warning, notice of inspection, notice of
violation or alleged violation, or Tenant receives notice or knowledge of any
proceeding, investigation, order or enforcement action, under any Hazardous
Materials Law concerning the Premises or, to the extent caused by Tenant, the
Shopping Center, or (iii) Tenant becomes aware of any Claims made or threatened
by any third party concerning the Premises or, to the extent caused by Tenant,
the Shopping Center respecting Hazardous Materials.
(d) Confirmation of Tenant's Knowledge. Upon request from Landlord or
Landlord's Mortgagee at any time, Tenant shall promptly execute all affidavits,
representations, and any other similar documents as Landlord or Landlord's
Mortgagee may request concerning Tenant's best knowledge and belief regarding
the presence or absence, or the use, generation, storage, disposal or
transportation of Hazardous Materials, under, about or from the Premises or, to
the extent caused by Tenant, the Shopping Center.
(e) Asbestos. If any asbestos containing materials exist in the Premises
that were introduced into the Premises by Tenant, its affiliates, agents,
contractors, employees, assignors, predecessors, successors or Transferees at
any time, Tenant shall remove all such asbestos containing materials prior to
(i) the expiration or earlier termination of this Lease and/or (ii) making
Improvements to the Premises and, in either event, regardless of whether such
removal is required by any Hazardous Materials Law.
(f) Landlord's Right to Terminate. If the Premises or any part of the
Shopping Center becomes or is discovered to be contaminated with any Hazardous
Materials, and if any handling of any nature is undertaken in connection
therewith (either at Landlord's own initiative or pursuant to the requirements
of any Government Authority), and if Tenant is not responsible for any handling
or indemnification in connection therewith under the Lease or otherwise, then
Landlord shall have the right to terminate the Lease upon thirty (30) days'
notice to Tenant in the event the estimated cost of any such handling exceeds an
amount equal to Two Hundred Fifty Thousand Dollars ($250,000) and such cost is
not covered by insurance, provided, however, that Landlord's notice shall
include the estimated cost of such handling. Tenant shall have the option to pay
the cost of such handling in excess of $250,000 which option must be exercised,
if at all, within twenty (20) days following Tenant's receipt of Landlord's
notice by written notice to Landlord and by depositing an amount equal to the
estimated cost of such handling in excess of $250,000 in a third party escrow
account in which event Landlord's notice to terminate will be null and void
provided Tenant pays for the entire cost of such handling in excess of $250,000
in a timely and reasonable manner. In no event shall Landlord terminate the
Lease unless Landlord terminates the leases of all other tenants similarly
affected by such circumstances.
(g) Initial Inspection. Tenant may, within fifteen (15) days after Tenant
takes possession of the Premises with Landlord's consent, provided the Lease is
fully executed and Tenant has not commenced any work in the Premises, perform an
inspection of the Premises by a recognized, certified environmental consultant
for the purpose of determining whether any Hazardous Materials exist in the
Premises.
In the event such inspection determines that Hazardous Materials do exist
and further that they require specific handling in accordance with applicable
Hazardous Materials Laws and provided said Hazardous Materials are not present
by reason of Tenant's Work (as defined in Exhibit C and to the extent made or
caused to be made by Tenant or an affiliate of Tenant), then Tenant shall have
the right to, within ten (10) days of such determination, notify Landlord of the
results of the inspection, in which event Landlord, at its sole cost and
expense, shall perform the necessary reasonable steps to handle such Hazardous
Materials (hereinafter referred to as "Remedial Work"). Notwithstanding the
foregoing to the contrary, if Landlord determines that the cost of such Remedial
Work, in Landlord's reasonable opinion, is excessive, or that such Remedial Work
would unreasonably interfere with the operation of the Shopping Center or other
businesses in the Shopping Center, Landlord may terminate this Lease and all
liability hereunder shall cease.
In the event any such Remedial Work delays the commencement of Tenant's
work in the Premises, the date certain referred to in Section 1.8, in connection
with the definition of the Rent Commencement Date shall be delayed by the
corresponding number of days that it takes to complete the Remedial Work,
calculated from the date Landlord receives Tenant's notice of the results of the
inspection and continuing until the Remedial Work is completed. Tenant shall not
be entitled to any further compensation or damages from Landlord arising
directly or indirectly from the Remedial Work including but not limited to loss
of use of the whole or any part of the Premises, the building of which the
Premises are a part, Tenant's Personal Property, or any inconvenience or
annoyance reasonably occasioned by the existence of Hazardous Materials and the
subsequent Remedial Work.
In no event does Tenant's right to inspect extend beyond the fifteen (15)
day period set forth above and, in the event Tenant waives its right to
inspection of the Premises, the right to inspect shall be of no force or effect;
upon the expiration of said fifteen (15) day period or upon Tenant's waiver of
its right to inspection, the handling or removal of Hazardous Materials shall be
governed in accordance with the provisions of Article 12 of the Lease.
ARTICLE 10
TENANT'S OPERATING COVENANTS
10.1 Operating Covenants. Tenant shall, continuously and uninterruptedly
from and after its initial opening for business, (a) operate and conduct within
the entire Premises the business that it is permitted to operate and conduct
under the provisions hereof, except while the Premises are untenantable by
reason of fire or other casualty, (b) maintain within the Premises an adequate
stock of merchandise together with sufficient personnel and Personal Property to
service and supply the usual and ordinary requirements of its customers, and (c)
keep the Premises in a neat, clean, and orderly condition.
10.2 Operating Days and Hours. It is in the interests of both Tenant and
Landlord to have regulated hours of business for all of the Shopping Center.
Commencing with the opening for business by Tenant in the Premises and for the
remainder of the Lease Term, Tenant shall be open for business daily and shall
continuously remain open for business with its window displays, exterior signs,
and exterior advertising displays adequately illuminated during all hours on all
days on which Landlord, in its sole and absolute discretion, determines to open
the Shopping Center for business to the public. If the Shopping Center contains
Common Area which is enclosed for the purpose of providing climatic control,
Landlord shall not be obligated to open the enclosed area so that Tenant may
conduct business except on those days and hours when (a) any one (1) of the
Major Department Stores shall be open for business, or (b) tenants in the
Shopping Center occupying at least fifty percent (50%) of the Floor Area thereof
shall have given reasonable advance notice to Landlord that they desire to be
open for business during such time.
Notwithstanding anything to the contrary contained in this Lease, in no
event shall Tenant be required to open for business on any day earlier than
10:00 a.m. or later than 10:00 p.m., or on Christmas Day or Thanksgiving Day,
unless at least fifty percent (50%) of the other Mall Tenants are open during
such period(s).
Tenant shall be permitted to be closed two (2) days per calendar year (on a
non-cumulative basis) for the purpose of taking inventory. Tenant shall provide
written notice to the Shopping Center General Manager at least ten (10) days
prior to the date of closing and shall display appropriate signage advising its
customers of such closure. In no event shall Tenant be permitted to close for
inventory during the period in any calendar year commencing November 1st and
ending December 31st.
ARTICLE 11
IMPROVEMENTS
11.1 Initial Construction of the Premises. Tenant shall submit to Landlord
plans and specifications for the construction of Tenant's storefront and store
interior in accordance with Exhibit C and the Tenant Package. Tenant shall
commence and diligently proceed with construction so as to complete the work
contemplated thereby and open for business in the Premises on or before the Rent
Commencement Date. All Personal Property must be new when installed in, or
attached to, the Premises.
Landlord agrees that Tenant may reuse the existing mechanical, electrical,
sprinkler, plumbing and alarm systems currently in the Premises, if any,
provided they are in good working order and are in compliance with Landlord's
current criteria and all laws, regulations, codes, ordinances, and other
governmental regulations relating thereto. Notwithstanding the foregoing,
Landlord makes no representations or warranties with respect to such systems and
assumes no responsibility or liability arising our of Tenant's reuse of such
systems.
11.2 Improvements. After the initial construction of the Premises by
Tenant, at Tenant's own expense and in accordance with Exhibit C, after giving
Landlord written notice of its intentions to do so, Tenant may, from time to
time, make such Improvements to the Premises as Tenant may find necessary or
convenient for its purposes so long as the value of the Premises is not thereby
materially diminished and subject to Landlord's approval as provided in this
Section. Tenant shall not make any of the following Improvements without
Landlord's prior written consent in each instance: Improvements costing more
than Ten Thousand Dollars ($10,000) in the aggregate per occurrence;
Improvements to the mechanical or electrical systems, to the exterior walls or
roof of the Premises, or to any storefront or area of the Premises within three
feet (3') of the storefront; the addition of any mezzanine or Improvements that
increase the size of any existing mezzanine; and any penetration into or through
the roof, ceiling or floor of the Premises. With the exception of the plans in
connection with the Tenant's initial construction and opening of the Premises,
Tenant shall reimburse Landlord for all reasonable costs and expenses
(including, without limitation, any reasonable architect or engineer fees)
incurred by Landlord in approving or disapproving Tenant's plans for
Improvements. Tenant shall certify to Landlord Tenant's actual cost of
constructing its Improvements within thirty (30) days after completing the same.
11.3 Mechanics' Liens.
(a) General. Tenant shall pay or cause to be paid all costs of labor,
services, and materials supplied in the prosecution of any work done in the
Premises on behalf of Tenant, and Tenant shall keep the Premises free and clear
of all mechanics' liens and other liens arising out of any work done for Tenant
or persons claiming under Tenant. Tenant shall promptly notify Landlord of any
Claim or lien filed against the Premises or the commencement of any action
affecting the title thereto.
(b) Contest of Lien. If Tenant desires to contest the claim of any
mechanics' lien, Tenant shall (i) either post a release bond issued by a
responsible corporate surety as prescribed by law, or furnish Landlord with
adequate security for the amount of the claim plus estimated costs and interest,
and (ii) promptly pay or cause to be paid any and all sums awarded to the
claimant on its suit.
(c) Landlord's Right to Cure. If Tenant fails to provide security for or
satisfaction of any mechanics' lien, then Landlord, in addition to any other
rights or remedies it may have, may (but shall not be obligated to) discharge
said lien by (i) paying the claimant an amount sufficient to settle and
discharge the claim, (ii) posting a release bond, or (iii) taking such action as
Landlord shall deem appropriate, and Tenant shall pay to Landlord on demand all
costs incurred by Landlord in settling and discharging such lien (including
reasonable attorney fees and bond premiums).
(d) Notice of Non-responsibility. Landlord, or its representatives shall
have the right to go upon and inspect the Premises at all reasonable times, and
shall have the right to post and keep posted thereon during the performance by
Tenant of any work described in this Article 11 notices of non-responsibility or
such other notices that Landlord may deem to be proper for the protection of
Landlord's interest in the Premises. Tenant shall give Landlord at least ten
(10) days advance written notice of its intention to commence any work that
might result in a lien described in this Article.
11.4 Title to Improvements. All Improvements shall become the property of
Landlord upon expiration or earlier termination of the Lease. Landlord's
reversionary interest in the Improvements shall at all times be prior and
superior to any interest of any lender of Tenant, or of any other entity
claiming any purchase money lien or other interest in the Improvements.
ARTICLE 12
REPAIRS; MAINTENANCE
12.1 Tenant's Obligations. Tenant agrees at all times from and after the
Commencement Date, at its own cost and expense, to repair, maintain in good and
tenantable condition and replace, as necessary, the Premises and every part
thereof (except portions of the Premises specifically required to be maintained
by Landlord pursuant to the Lease), including without limitation all equipment
and Utility Installations exclusively serving the Premises; any Air Conditioning
System exclusively serving the Premises; exterior and interior glass; signs;
locks and closing devices, window sashes, casements and frames; doors and door
frames; floor coverings; any grease traps, grease lines, and/or piping; the
storefront; and all items of repair, maintenance, alteration, improvement or
reconstruction as may be required by any Legal Requirement or the insurance
underwriter(s) for the Shopping Center. In no event shall Tenant be required to
make repairs necessitated by the negligence or willful acts of Landlord or
anyone claiming under Landlord, because of the failure of Landlord to perform or
observe any term or condition of the Lease, or because of Improvements made by
Landlord except to the extent otherwise covered by the insurance Tenant is
required to carry under the Lease. All replacements made by Tenant shall be of
like size, kind, and quality to the items replaced as they existed when
originally installed and shall be subject to Landlord's prior approval. Tenant
shall have the benefit of any warranty(ies) in connection with Landlord's Work
to the extent any such warranty covers portions of the Premises Tenant is
obligated to repair and maintain hereunder.
12.2 Landlord's Obligations. Landlord shall repair, maintain in good and
tenantable condition (and in compliance with Legal Requirements and requirements
of the insurance underwriter(s) for the Shopping Center) and replace, as
necessary, the roof, exterior walls, and structural parts of the Premises
(including the structural floor), and all Utility Installations serving the
Premises on a nonexclusive basis (except where the appropriate utility company
performs such duties) or that form a centralized Air Conditioning System serving
the Premises on a nonexclusive basis. In no event shall Landlord be required to
make repairs necessitated by the negligence or willful acts of Tenant or anyone
claiming under Tenant, because of the failure of Tenant to perform or observe
any term or condition of the Lease, or because of Improvements made by Tenant
except to the extent otherwise covered by the insurance Landlord is required to
carry under the Lease. Landlord shall be under no obligation to repair, replace
or maintain the Premises or the mechanical equipment exclusively serving the
Premises at any time, except as the Lease expressly provides. Notwithstanding
anything to the contrary contained in the Lease, Landlord shall not in any way
be liable to Tenant for failure to make repairs as herein specifically required
of it unless Tenant has previously notified Landlord of the need for such
repairs and Landlord has failed to commence and complete said repairs within a
reasonable period following receipt of Tenant's notification. As used in this
Article 12, "exterior walls" shall exclude storefronts, plate glass, window
cases or window frames, doors or door frames, security grilles or similar
enclosures. The definition of Common Area Expenses includes all work performed
by Landlord in accordance with this Section except as otherwise expressly
provided for in the Lease.
12.3 Performance of Work by Landlord. If Tenant refuses or neglects to
repair, replace, or maintain the Premises, or any part thereof, in a manner
reasonably satisfactory to Landlord, Landlord shall have the right but not the
obligation, upon giving Tenant reasonable notice of its election to do so, to
enter the Premises and make such repairs or perform such maintenance or
replacements on behalf of and for the account of Tenant. Nothing herein
contained shall imply any duty of Landlord to do any work that, under any
provision of the Lease, Tenant is required to do, nor shall Landlord's
performance of any repairs on behalf of Tenant constitute a waiver of Tenant's
default in failing to do the same. No exercise by Landlord of any rights herein
reserved shall entitle Tenant to any compensation, damages or abatement of Rent
from Landlord for any injury or inconvenience occasioned thereby. If Landlord
performs any maintenance or other obligations that Tenant is required to perform
under the terms of the Lease, Tenant shall upon demand pay to Landlord the costs
and expenses incurred by Landlord in doing the same (or shall deposit with
Landlord the anticipated amounts thereof), plus Landlord's Administrative Fee.
12.4 Service Contracts. If the Air Conditioning System exclusively serves
the Premises, Tenant shall contract with a qualified air conditioning service
company approved by Landlord for the monthly maintenance and the repair and
replacement, as necessary, of the Air Conditioning System. If the Air
Conditioning System serving the Premises is a centralized system serving the
Premises on a nonexclusive basis, Tenant shall contract with a qualified air
conditioning service company designated by Landlord (provided that the rates
charged by such service company are competitive in the trade area for
commensurate contractors) for the inspection and maintenance at least once every
calendar year and the repair and replacement, as necessary, of the distribution
portion of the Air Conditioning System serving the Premises. Tenant shall
contract with a qualified service company for the cleaning and maintenance of
any grease traps and/or grease lines which are Tenant's responsibility to
maintain. Tenant shall provide Landlord with a copy of any contract required
under this Section within ten (10) days after the Commencement Date, together
with a copy of any subsequent contracts within ten (10) days after their
execution.
ARTICLE 13
INSURANCE OBLIGATIONS
13.1 Tenant's Insurance Obligations. At all times from and after the
Commencement Date, Tenant shall procure and maintain, at its sole cost and
expense, the following policies of insurance:
(a) Liability. Commercial general liability insurance with broad form
contractual liability coverage and with coverage limits of not less than Two
Million Dollars ($2,000,000) combined single limit, per occurrence, specifically
including liquor liability insurance covering consumption of alcoholic beverages
by customers of Tenant, if the sale of alcoholic beverages is permitted in the
Premises. Such policy shall insure Tenant's performance of the indemnity
provisions of this Lease, but the amount of such insurance shall not limit
Tenant's liability nor relieve Tenant of any obligation hereunder.
(b) Workers' Compensation. Workers' compensation insurance in the amount
required by the state in which the Shopping Center is located for the benefit of
Tenant's employees.
(c) Plate Glass. Insurance covering the full replacement cost of all plate
glass on the Premises; Tenant may self-insure such risk .
(d) Equipment. Boiler and machinery insurance on the Air Conditioning
System (or any part thereof) exclusively serving the Premises.
(e) Tenant's Personal Property and Improvements. Property insurance
covering any peril generally included in the classification "all risks"
(excluding earthquake and flood) in the area in which the Shopping Center is
located covering all (i) merchandise, (ii) Improvements, and (iii) Personal
Property owned or leased by Tenant (or for which Tenant is legally liable) and
located in the Shopping Center, in an amount not less than ninety percent (90%)
of their full replacement cost. Any policy proceeds shall be used for the repair
or replacement of the property damaged or destroyed, unless the Lease is
terminated under the provisions of Article 18.
13.2 Policy Requirements; Right to Adjust Requirements. All policies of
insurance provided for herein shall be issued by insurance companies that have a
general policyholder's rating of not less than "A" and a financial rating
equivalent to a policyholder's surplus of at least One Hundred Million Dollars
($100,000,000), as rated in the most current available "Best's" Insurance
Reports, and that have been admitted or qualified to do business in the state
where the Shopping Center is located by the insurance commission or other
highest board, body or official responsible for overseeing the insurance
business in such state. Tenant's general liability policy as required in Section
13.1(a) shall contain cross-liability endorsements. All policies of insurance
provided for herein (with the exception of workers' compensation insurance)
shall name Landlord, Landlord's property manager, all Mortgagees and such other
individuals or entities as Landlord may from time to time designate, as
"additional insureds." Certificates of all insurance required of Tenant
hereunder expressly providing for the waiver of subrogation as required in
Section 13.4 shall be delivered to Landlord at least ten (10) days prior to the
Commencement Date. Tenant shall provide to Landlord, at least thirty (30) days
prior to expiration, certificates of insurance to evidence any renewal or
additional insurance procured by Tenant. All certificates of insurance delivered
to Landlord shall contain an agreement by the company issuing said policy to
give Landlord twenty (20) days' advance written notice of any cancellation,
lapse, reduction or other adverse change respecting such insurance. All
commercial general liability insurance, property damage or other casualty
policies shall be written as primary policies, not contributory with or
secondary to coverage that Landlord may carry.
Notwithstanding anything to the contrary contained herein, Tenant shall be
permitted to have Tenant's primary commercial general liability insurance policy
written in a lesser amount than specified in Section 13.1(a) (in no event less
than fifty percent [50%] of the required coverage) provided Tenant carries and
maintains an "excess liability" and/or "umbrella policy" to cover the balance of
the required coverage and provided that all the requirements set forth herein
are otherwise satisfied. Further, Tenant shall be permitted to have any required
insurance covered as part of a blanket policy with a so called "agreed amount
endorsement" for the business conducted upon the Premises providing the
insurance coverage required under this Lease.
13.3 Landlord's Insurance Obligation. At all times from and after the
Commencement Date, Landlord shall maintain in effect insurance providing
protection for the following liabilities and/or risks: (a) commercial general
liability insurance for bodily injury and property damage arising from
Landlord's ownership and/or operation of the Shopping Center with coverage
limits at least equal to those Tenant is required to maintain as provided
herein, and (b) any peril included in the classification All Risks in the
geographic area in which the Shopping Center is located, including earthquake
coverage, covering the Shopping Center, exclusive of any item that Tenant is
required to insure, or any item, building or improvement that another party is
required to insure (e.g., Major Department Stores), in an amount that is the
greater of eighty percent (80%) of its full replacement cost (exclusive of the
cost of excavations, foundations, and footings), or such greater amount as any
Mortgagee may require Landlord to maintain.
13.4 Mutual Waivers of Rights. Notwithstanding anything to the contrary
contained in this Lease, Landlord (for itself and its insurer), waives any
rights, including rights of subrogation, and Tenant (for itself and its
insurer), waives any rights, including rights of subrogation, each may have
against the other, and Tenant (for itself and its insurer) waives any rights,
including rights of subrogation, it may have against any of the parties to the
REA, for compensation of any loss or damage occasioned to Landlord or Tenant
arising from any risk generally covered by the All Risks insurance required to
be carried by Landlord and Tenant. The foregoing waivers shall be operative only
so long as available in the state where the Shopping Center is located. The
foregoing waivers shall be effective whether or not the parties maintain the
insurance required to be carried pursuant to the Lease.
ARTICLE 14
INDEMNITY
From and after the Commencement Date, Tenant shall indemnify, protect,
defend, and hold Landlord (and its partners, joint venturers, shareholders,
Mortgagee, affiliates, and property managers, and their respective officers,
directors, employees, and agents) harmless from and against any and all Claims
arising out of or in connection with loss of life, personal injury, property
damage or otherwise arising from (a) the use, occupation, improvement or
maintenance of the Premises or the Shopping Center or any work or activity in or
about the Premises or Shopping Center by Tenant or its assignees or subtenants
or their respective agents, employees, contractors, or licensees , (b) any
activity, condition or occurrence in or about the Premises, (c) the filing or
potential filing of any mechanic's or materialmen's lien against the Premises or
the Shopping Center in connection with any work done or caused to be done by
Tenant, (d) any breach or failure to perform any obligation imposed on Tenant
under the Lease, or (e) any act or omission of Tenant or its assignees or
subtenants or their respective agents, contractors, employees, or licensees.
Upon notice from Landlord, Tenant shall, at Tenant's sole expense and by counsel
reasonably satisfactory to Landlord, defend any action or proceeding brought
against Landlord by reason of any such Claim. If Landlord (or its partners,
joint venturers, shareholders, Mortgagee, affiliates, and property managers, or
their respective officers, directors, employees, and agents), without fault on
its part, is made a party to any litigation commenced by or against Tenant, then
Tenant shall indemnify, protect, defend, and hold each of such persons harmless
from and against any and all Claims arising out of incurred or paid by any such
person in connection with such litigation. The obligations of this Article shall
survive the expiration or earlier termination of the Lease. In no event shall
Tenant's obligations pursuant to this Article 14 extend to Claims arising out of
the sole negligence or willful misconduct of Landlord, or its agents, employees
or contractors (acting on behalf of Landlord).
ARTICLE 15
OCCUPANCY TRANSACTIONS
15.1 Restrictions.
(a) No Encumbrances. Tenant shall not make, consent to, or suffer any
Encumbrance without the prior written consent of Landlord, which Landlord may
grant or withhold in its sole and absolute discretion.
(b) Other Occupancy Transactions. Tenant shall not enter into or consent to
any Occupancy Transaction other than an Encumbrance without first obtaining
Landlord's written consent, which Landlord shall not withhold unreasonably.
Landlord may withhold its consent on any reasonable ground, including without
limitation any of the following situations: (i) the Transferee's contemplated
use of the Premises following the proposed Occupancy Transaction is not
identical to the Permitted Use, (ii) in Landlord's reasonable business judgment,
the Transferee lacks sufficient business reputation or experience to operate a
business of the type and quality permitted under this Lease, (iii) the present
net worth and working capital of the Transferee are less than that of Tenant, or
Tenant and Tenant's Guarantor, as the case may be, at the Effective Date or at
the time of the request, whichever is higher, (iv) the proposed Occupancy
Transaction would breach any covenant of Landlord or Tenant respecting radius
restriction, location, use or exclusivity in any other lease, financing
agreement, or other agreement relating to the Shopping Center, or (v) the
proposed Occupancy Transaction provides for rentals thereunder based on the net
income or profits derived by the Transferee from the Premises.
15.2 Condition Precedent. Tenant shall not have the right or power to enter
into an Occupancy Transaction if Tenant shall be in default beyond any
applicable notice and cure period pursuant to Article 16 under any provision of
the Lease .
15.3 Procedures. Should Tenant desire to enter into an Occupancy
Transaction which requires Landlord's consent, Tenant shall request Landlord's
consent to such transaction in writing at least forty-five (45) days before the
effective date of any such transaction. Such request shall include the
following:
(a) A detailed description of the proposed transaction, including its
nature, effective date, the purchase price, payment terms, allocation among
leasehold interest, Personal Property, Improvements, goodwill, inventory, and
other items;
(b) Copies of any offers, agreements, subleases, assignments, letters of
commitment or intent, and other documents or correspondence pertaining to the
proposed transaction;
(c) A description of the identity, financial condition, and previous
business experience of Tenant and Transferee, including, without limitation,
copies of latest income statement, balance sheet, and statement of cash flows
(with accompanying notes and disclosures of all material changes thereto) in
audited form, if available, and certified as accurate by Tenant or Transferee
respectively, together with a statement authorizing Landlord or its designated
representative(s) to investigate Tenant's and Transferee's business experience,
credit, and financial responsibility; and
(d) A statement by Tenant and Transferee agreeing that it is their
intention to complete the transaction if Landlord consents thereto.
15.4 Response by Landlord; Documentation. Within thirty (30) days after
receipt of Tenant's request for consent and all items required under Section
15.3, Landlord shall (a) consent to the proposed Occupancy Transaction, (b)
exercise its rights under Section 15.6, or (c) refuse to consent to the
Occupancy Transaction. Any consent by Landlord to any Occupancy Transaction
shall be evidenced by an instrument prepared by Landlord and executed by Tenant
and Transferee. As a condition to the completion of any assignment or transfer
of Tenant's interest in the Lease, Transferee shall agree in writing to assume
and perform all of the terms, covenants, and conditions of the Lease that are
obligations of Tenant. Tenant shall remain fully liable to perform its duties
under the Lease following the Occupancy Transaction. Tenant shall, on demand of
Landlord, reimburse Landlord for all Landlord's reasonable costs, including
attorney fees, incurred in obtaining advice and preparing documentation for each
requested Occupancy Transaction not to exceed One Thousand Dollars ($1,000.00)
per occurrence.
15.5 Consideration to Landlord. Except for those Occupancy Transactions
permitted pursuant to the provisions of Section 15.8 without Landlord's prior
consent, if Tenant enters into an Occupancy Transaction, the Minimum Annual Rent
then payable and any scheduled increases thereto shall be increased on the
effective date of such transaction to the highest of: (a) the total Minimum
Annual Rent payable by the Transferee to Tenant; (b) an amount equal to the
total of the Minimum Annual Rent plus Percentage Rent required to be paid by
Tenant pursuant to this Lease during the calendar year immediately preceding
such transaction; or (c) the Minimum Annual Rent payable in the first full year
of the Lease Term, increased in accordance with the CPI Adjustment Procedures
using the Rent Commencement Date as the Base Month and the effective date of
such transaction as the Month of Adjustment. In no event shall the Minimum
Annual Rent, as adjusted, be less than the Minimum Annual Rent in effect prior
to the effective date of the Occupancy Transaction.
15.6 Landlord's Right of First Refusal. If Tenant requests consent to an
Occupancy Transaction in accordance with this Article, Landlord shall have the
right to purchase the leasehold interest of Tenant in the Lease and the Premises
(referred to in this Section as "Tenant's interest"), to the exclusion of the
prospective Transferee, at the purchase price and terms offered by the
prospective Transferee. Such right shall be exercisable by Landlord by giving
Tenant notice of its election to purchase as provided in Section 15.4. Upon such
election, the proposed Transferee shall have no right to purchase Tenant's
interest, Landlord and Tenant shall execute an agreement setting forth the terms
and conditions of the purchase, and the proposed Occupancy Transaction shall be
deemed to have been disapproved. No failure of Landlord to elect to exercise its
rights hereunder shall be construed as consent to the proposed Occupancy
Transaction or a waiver of such rights with respect to any future proposed
Occupancy Transaction.
15.7 Nullity. Any Occupancy Transaction purportedly consummated in
violation of the provisions of this Article shall be null and void and of no
force or effect.
15.8 Permitted Occupancy Transactions. Notwithstanding anything to the
contrary contained in this Article 15, so long as the Tenant (i) is the tenant
entity named in Section 1.2 of this Lease and (ii) is not in default as provided
in Section 15.2, Tenant shall have the right, without the prior written consent
of Landlord, to enter into an Occupancy Transaction, other than an Encumbrance,
with a person or entity which: [a] is Tenant's parent organization; or [b] is a
wholly-owned subsidiary of Tenant; or [c] is a corporation of which Tenant or
Tenant's parent organization owns in excess of fifty percent (50%) of the
outstanding capital stock; or [d] as a result of a consolidation or merger with
Tenant and/or Tenant's parent corporation shall own all the capital stock of
Tenant or Tenant's parent corporation; or [e] purchases all or substantially all
of Tenant's assets provided such acquisition includes at least ten (10) stores
operating under the Trade Name (or a trade name similar to the Trade Name)
permitted under this Lease; or [f] acquires stock constituting effective control
of Tenant provided that at the time of such acquisition Tenant operates at least
ten (10) stores under the Trade Name (or a trade name similar to the Trade Name)
permitted under this Lease. Any Occupancy Transaction pursuant to [a], [b], [c],
[d], [e], or [f] above shall be subject to the following conditions: (1) Tenant
shall remain fully liable during the unexpired Lease Term; (2) any such
Occupancy Transaction shall be subject to all of the terms, covenants and
conditions of this Lease and any such Transferee shall expressly assume for the
benefit of Landlord the obligations of Tenant under this Lease by a document
prepared by Landlord; (3) the resulting entity pursuant to [d], [e], and [f]
above shall have a net worth equal to or greater than Four Million Dollars
($4,000,000.00); (4) Tenant shall give Landlord notice of such Occupancy
Transaction at least twenty (20) days prior to its effective date (which notice
shall include all documentation necessary to verify the conditions contained in
this paragraph); and (5) Tenant shall reimburse Landlord for Landlord's
reasonable documentation fees incurred in conjunction with the processing and
preparation of documentation for any such Occupancy Transaction, not to exceed
One Thousand Dollars ($1,000.00) per occurrence.
ARTICLE 16
DEFAULTS BY TENANT; LANDLORD REMEDIES
16.1 Events of Default. The occurrence of any of the following shall
constitute a default by Tenant and a breach of the Lease.
(a) Failing or refusing to pay any amount of Minimum Annual Rent or
Additional Rent when due in accordance with the provisions of the Lease;
(b) Failing or refusing to occupy and operate the Premises in accordance
with Sections 10.1 and 10.2 or conducting a going-out-of-business, liquidation
or similar sale;
(c) Failing or refusing to perform fully and promptly any covenant or
condition of the Lease, other than those specified in subparagraphs (a) and (b)
above or (d) below; or
(d) Maintaining, committing, or permitting on the Premises waste or a
nuisance in any twelve (12) consecutive month period in which Tenant has
previously received one (1) or more notices of such violation; use of the
Premises for an unlawful purpose; entering into an Occupancy Transaction
contrary to the provisions of Article 15; failing to remain open for business as
required by Section 10.2, on any occasion during a given year of the Lease Term
in which Tenant has received three (3) or more notices of violations of said
Section; and in the event the Permitted Use involves the sale and/or preparation
of food, Tenant's failure to maintain a health department rating of "A" (or such
other highest health department or similar rating as is available) for the
second (2nd) time in any twelve (12) month period.
16.2 Notices. Following the occurrence of any of the defaults specified in
subparagraphs (a), (b) and (c) of Section 16.1, Landlord shall give Tenant, and
any subtenant, a written notice specifying the nature of the default and
demanding that Tenant, and any subtenant, either fully cure each such default
within the time period specified in the correspondingly lettered subparagraphs
below or quit the Premises and surrender the same to Landlord:
(a) For nonpayment of Minimum Annual Rent or Additional Rent, the first two
(2) such notices in each calendar year will be ten (10) day notices, thereafter
during such calendar year, five (5) days;
(b) For breach of Sections 10.1 or 10.2 or for conducting a
going-out-of-business, liquidation or similar sale, three (3) business ( i.e.,
Monday through Friday) days;
(c) With regard to those defaults specified in subparagraph (c) of Section
16.1, a reasonable period not to exceed thirty (30) days; provided, however,
that if such default cannot be cured within said time period, Tenant shall be
deemed to have cured such default if Tenant so notifies Landlord in writing,
commences cure of the default within said time period, thereafter diligently and
in good faith continues with said cure and actually completes said cure (and
upon request from Landlord, Tenant shall provide Landlord with written notice as
to the progress of Tenant's cure); and
(d) With regard to those defaults specified in subparagraph (d) of Section
16.1, Landlord shall give Tenant, and any subtenant, a written notice specifying
the nature of the default and the provisions of the Lease breached and Landlord
shall have the right to demand in said notice that Tenant quit the Premises
within five (5) days.
To the extent permitted by applicable state law, the time periods provided
in this Section for cure of Tenant's defaults under this Lease or for surrender
of the Premises shall be in lieu of, and not in addition to, any similar time
periods prescribed by applicable state law as a condition precedent to the
commencement of legal action against Tenant for possession of the Premises;
provided, however, to the extent the foregoing is not permitted by applicable
law, any notice under this Section shall run concurrently with, and not in
addition to, any similar time periods prescribed by applicable law. Any notice
given pursuant to this Section is in lieu of any written notice required by
statute or law, including any notice required under California Code of Civil
Procedure section 1161, and Tenant waives (to the fullest extent permitted by
law) the giving of any notice other than that provided for in this Section.
16.3 Landlord's Rights and Remedies. Should Tenant fail to cure within the
time periods specified in Section 16.2 any default specified in subparagraph
(a), (b) or (c) of Section 16.1, or fail to quit the Premises in accordance with
subparagraph (d) of Section 16.2 with respect to any default specified in
subparagraph (d) of Section 16.1, Landlord may exercise any of the following
rights without further notice or demand of any kind to Tenant or any other
person, except as required by applicable state law:
(a) The right of Landlord to terminate the Lease and Tenant's right to
possession of the Premises and to reenter the Premises, take possession thereof
and remove all persons therefrom, following which Tenant shall have no further
claim thereon or hereunder;
(b) The right of Landlord, without terminating the Lease and Tenant's right
to possession of the Premises, to reenter the Premises and occupy the whole or
any part thereof for and on account of Tenant and to collect any unpaid Rent
which have become payable, or which may thereafter become payable; or
(c) The right of Landlord, even though it may have reentered the Premises,
in accordance with subparagraph (b) of this Section, to elect thereafter to
terminate the Lease and Tenant's right to possession of the Premises.
Should Landlord have reentered the Premises under the provisions of
subparagraph (b) of this Section, Landlord shall not be deemed to have
terminated the Lease or have accepted a surrender thereof by any such reentry,
unless Landlord shall have notified Tenant in writing that it has so elected to
terminate the Lease and Tenant's right to possession. Tenant further covenants
that the service by Landlord of any notice pursuant to the unlawful detainer or
eviction statutes of the state where the Shopping Center is located and the
surrender of possession pursuant to such notice shall not (unless Landlord
elects to the contrary at the time of, or at any time subsequent to, the serving
of such notice and such election is evidenced by a written notice to Tenant) be
deemed to be a termination of the Lease. In the event of any reentry or taking
possession of the Premises as aforesaid, Landlord shall have the right, but not
the obligation, to remove therefrom all or any part of the merchandise,
Improvements or Personal Property located therein and to place the same in
storage at a public warehouse at the expense and risk of Tenant. The rights and
remedies given to Landlord in this Section shall be additional and supplemental
to all other rights or remedies which Landlord may have under laws in force when
the default occurs.
Landlord agrees that in the event Tenant defaults under the Lease and
thereafter vacates the Premises, Landlord shall use its reasonable efforts to
re-lease the Premises and mitigate monetary damages arising out of Tenant's
default or breach of this Lease. Nothing herein, however, shall prohibit
Landlord from leasing any other vacant premises before leasing the Premises
hereunder, or from using its business judgment respecting the leasing of the
Premises hereunder.
16.4 Landlord's Damages. Should Landlord terminate the Lease and Tenant's
right to possession of the Premises, pursuant to the provisions of subparagraphs
(a) or (c) of Section 16.3, Landlord may recover from Tenant as damages, all of
the following:
(a) The worth at the time of award of any unpaid Rent that had been earned
at the time of such termination;
(b) The worth at the time of award of the amount by which the unpaid Rent
that would have been earned after termination until the time of award exceeds
the amount of such Rent loss Tenant proves could have been reasonably avoided;
(c) The worth at the time of award of the amount by which the unpaid Rent
for the balance of the Lease Term after the time of award exceeds the amount of
such Rent loss that Tenant proves could be reasonably avoided;
(d) Any other amount necessary to compensate Landlord for all the detriment
proximately caused by Tenant's failure to perform its obligations under the
Lease or which in the ordinary course of things would be likely to result
therefrom, including, without limitation, any costs or expense incurred by
Landlord in (i) retaking possession of the Premises, including reasonable
attorney fees therefor, (ii) maintaining or preserving the Premises after such
default, (iii) preparing the Premises for reletting to a new tenant, including
repairs or demolition to the Premises for such reletting, (iv) leasing
commissions, and (v) any other costs necessary or appropriate to relet the
Premises; and
(e) At Landlord's election, such other amounts in addition to or in lieu of
the foregoing as may be permitted from time to time by the laws of the state
where the Shopping Center is located.
As used in subparagraphs (a) and (b) of this Section, the "worth at the
time of award" is computed by allowing interest at the Interest Rate. As used in
subparagraph (c) of this Section, the "worth at the time of award" is computed
by discounting such amount at the discount rate of the Federal Reserve Bank of
San Francisco at the time of award plus one percent (1%).
All Additional Rent shall, for the purposes of calculating any amount due
under the provisions of subparagraph (c) of this Section, be computed on the
basis of the average monthly amount thereof accruing during the immediately
preceding thirty-six (36) month period, except that, if it becomes necessary to
compute such Additional Rent before such a thirty-six (36) month period has
occurred, then such Additional Rent shall be computed on the basis of the
average monthly amount hereof accruing during such shorter period.
16.5 Personal Property. In the event of Tenant's default, continuing during
the length of said default, Landlord shall have the right to take the exclusive
possession of any of Tenant's merchandise and/or Personal Property remaining on
the Premises and to use the same free of rent or charge until all defaults have
been cured or, at its option, to require Tenant to remove same forthwith. In the
event of any reentry or taking possession of the Premises as provided in this
Article, Landlord shall have the right, but not the obligation, to remove
therefrom all or any part of the merchandise or Personal Property located
therein and to place the same in storage at a public warehouse at the expense
and risk of Tenant.
Notwithstanding anything to the contrary contained herein, upon Tenant's
written request therefor, provided such request is in connection with the
remodel, alteration or merchandising of the Premises and provided Tenant is not
in default under this Lease (beyond the applicable notice and cure period as
provided in Article 16), Landlord shall subordinate its rights, on a form
prepared by Landlord, in such Personal Property of Tenant to the rights of any
fixture or equipment seller, lender or lessor (hereinafter "Lender") of Tenant,
but only so long as Tenant is indebted to such Lender, provided such Lender
agrees to (i) allow Landlord thirty (30) days to cure Tenant's default under the
agreement between Tenant and Lender, (ii) provide Landlord with no less than
five (5) days' written notice in the event of entry for repossession and shall
have said Personal Property removed within five (5) days from the date of entry
for repossession, (iii) remove the Personal Property promptly upon notification
from Landlord in the event of default by Tenant under the Lease, (iv) be
accompanied by a representative of center management during any such entry, and
only during reasonable business hours, (v) repair all damage occasioned by any
such repossession at Lender's sole expense, (vi) defend, indemnify and hold
Landlord harmless from any claims made as a result of the removal of the
Personal Property by Lender, (vii) dispose of or sell the property at some place
other than the Shopping Center, and (viii) advise Landlord in writing within
twenty (20) days after the expiration or earlier termination of the agreement
between Lender and Tenant as to said Personal Property. In no event shall
Landlord be under any obligation to assist in the repossession of such Personal
Property. Tenant further agrees to reimburse Landlord, in advance, for
Landlord's reasonable costs incurred in preparing the documentation referred to
herein (not to exceed $500 per occurrence)
16.6 Waiver of Rights of Redemption. Tenant expressly waives any and all
rights of redemption granted by or under any present or future laws if Tenant is
evicted or dispossessed for any cause, or if Landlord obtains possession of the
Premises by reason of the violation by Tenant of any of the terms, covenants,
and conditions of the Lease or otherwise.
ARTICLE 17
DEFAULTS BY LANDLORD; TENANT'S REMEDIES
17.1 Default by Landlord. If Landlord fails to perform or observe any of
the terms, covenants or conditions contained in the Lease on its part to be
performed or observed within thirty (30) days after written notice of default
from Tenant or, when more than thirty (30) days shall be required because of the
nature of the default, if Landlord shall fail to proceed diligently to cure such
default after written notice thereof from Tenant, said failure shall constitute
a default by Landlord under the Lease.
17.2 Notice to Mortgagees. If the Premises or any part thereof, or any
interest of Landlord in the Lease or the Rent due hereunder, are at any time
subject to any Mortgage and if Tenant is given notice of the name and address of
the Mortgagee, then Tenant shall give written notice of any Landlord's default
to such Mortgagee, specifying the default in reasonable detail. If Landlord
fails to cure such default within the applicable cure period, Tenant shall give
written notice of such failure to such Mortgagee affording such Mortgagee the
same opportunity to cure as provided Landlord in Section 17.1. If such Mortgagee
does perform on behalf of Landlord, such default shall be deemed cured.
17.3 Limitations on Remedies Against Landlord. In the event Tenant makes
any Claim or asserts any cause of action against Landlord as a result of
Landlord's default: (a) Tenant's sole and exclusive remedy shall be against the
current rents, issues, profits, and other income Landlord receives from its
operation of the Shopping Center, net of all current operating expenses,
liabilities, reserves, and debt service associated with said operation ("Net
Income" for purposes of this Section only), (b) no other real, personal or mixed
property of Landlord, wherever located, shall be subject to levy on any judgment
obtained against Landlord, (c) if such Net Income is insufficient to satisfy any
judgment, Tenant will not institute any further action, suit, Claim or demand,
in law or in equity, against Landlord for or on the account of such deficiency,
and (d) Landlord's default shall not constitute consent by Landlord for Tenant
to perform or observe such terms, covenants or conditions at Landlord's expense.
The limitations set forth in this Section shall be applicable to, and
enforceable by, Landlord and/or by any partner, trustee, officer, employee,
agent or property manager of Landlord.
17.4 Landlord's Exemption From Liability. Landlord shall not be liable for
injury to Tenant's business or loss of income therefrom or for damage that may
be sustained by the person, merchandise or Personal Property of Tenant, its
employees, invitees, customers, agents or contractors or any other person in or
about the Premises, caused by or resulting from fire, steam, electricity, gas,
water or rain, which may leak or flow from or into any part of the Premises, or
from the breakage, leakage, obstruction or other defects of the Utility
Installations, Air Conditioning System or other components of the Premises or
Shopping Center, or as a result of the exercise by Landlord of its rights under
the Lease, except to the extent that such damage or loss is caused by Landlord's
sole, active negligence or wilful misconduct. Landlord makes no representations
or warranties whatsoever with respect to any Air Conditioning System or Utility
Installations existing as of the date hereof or in the future except as
expressly provided in Section 2.1. Landlord shall not be liable in damages or
otherwise for any discontinuance, failure or interruption of service to the
Premises of Utilities or the Air Conditioning System and Tenant shall have no
right to terminate the Lease or withhold rent because of the same except as
otherwise expressly provided for in this Section 17.4. Landlord shall not be
liable for any damages arising from any use, act or failure to act of any other
tenant or occupant, if any, of the Shopping Center.
Notwithstanding anything to the contrary contained in this Lease, if as a
result of Landlord's or Landlord's agent's negligence, any utility or Air
Conditioning System being furnished to Tenant is interrupted for more than
seventy-two (72) consecutive hours, then commencing with the first full business
day thereafter, there shall be an equitable abatement of Minimum Annual Rent and
Additional Rent (except Percentage Rent) reflecting the extent Tenant's ability
to conduct business in the Premises is impaired, continuing until such time as
the utility service to the Premises is restored. Such abatement shall not affect
any obligation of Tenant under this Lease to pay Percentage Rent.
ARTICLE 18
RECONSTRUCTION
18.1 Insured Casualty. Upon the occurrence of an Insured Casualty to the
Premises Landlord shall commence Reconstruction of Landlord's Work within ninety
(90) days after such occurrence (provided neither party has terminated as
provided in this Section) and prosecute the same diligently to completion, and
Tenant shall commence Reconstruction of Tenant's Work promptly upon completion
of Landlord's Work and shall diligently prosecute the same to completion. In the
event of a Major Destruction of the Premises as a result of an Insured Casualty
during the last two (2) years of the Lease Term, Landlord and Tenant shall each
have the option to terminate the Lease on written notice to the other of
exercise thereof within thirty (30) days after such occurrence.
18.2 Uninsured Casualty. Upon the occurrence of an Uninsured Casualty to
the Premises, Landlord shall have the election, and shall within ninety (90)
days following the date of such damage give Tenant written notice of Landlord's
election, either to commence Reconstruction of the Premises and prosecute the
same diligently to completion, in which event the Lease shall continue in full
force and effect, or not to perform such Reconstruction, in which event the
Lease shall cease and terminate not later than sixty (60) days after Landlord's
notice of its election to terminate. In the event of a Major Destruction of the
Premises as a result of an Uninsured Casualty during the last two (2) years of
the Lease Term, Tenant shall have the option to terminate this Lease on written
notice to Landlord of exercise thereof within thirty (30) days after such
occurrence.
18.3 Construction Provisions. Reconstruction shall substantially conform to
the provisions of Exhibit C and shall cover Landlord's Work and Tenant's Work.
Landlord shall reconstruct the Premises only to the extent of Landlord's Work;
Tenant, at its sole cost and expense, shall reconstruct Tenant's Work and shall
replace its merchandise, Improvements and Personal Property.
18.4 Release of Liability. In the event of termination under any of the
provisions of this Article, both Landlord and Tenant shall be released from any
liability or obligation under the Lease, except as otherwise provided for in the
Lease, arising after the date of termination. In the event of termination, all
proceeds from Tenant's insurance covering Tenant's Improvements, but excluding
proceeds for Tenant's merchandise, the unamortized net cost to Tenant of its
Improvements with a straight-line amortization schedule and an amortization
period equal to the Lease Term, and Personal Property, shall be disbursed and
paid to Landlord. In no event shall Tenant be entitled to share in Landlord's
insurance proceeds or to take any action which would result in a reduction of
Landlord's insurance proceeds.
18.5 Abatement of Rent. In the event of an Insured Casualty or an Uninsured
Casualty to the Premises, the recurrent Rent (except Percentage Rent) payable by
Tenant shall be abated proportionately with the degree to which Tenant's use of
the Premises is impaired, commencing from the date of destruction and continuing
during the period of Reconstruction or until the effective date of termination,
as the case may be. Tenant shall continue the operation of its business on the
Premises during any such period to the extent reasonably practicable from the
standpoint of prudent business management, and the obligation of Tenant to pay
Percentage Rent and non-recurrent Rent shall remain in full force and effect.
Tenant shall not be entitled to any compensation or damages from Landlord for
loss of use of the whole or any part of the Premises, the Building, Tenant's
Personal Property, or any inconvenience or annoyance occasioned by such damage,
Reconstruction or replacement.
18.6 Major Destruction. Notwithstanding any of the foregoing provisions of
this Article, should there be a Major Destruction of the Shopping Center at any
time after the Effective Date, Landlord shall have the right to terminate the
Lease on written notice to Tenant within ninety (90) days after such
destruction. In no event shall Landlord terminate the Lease unless it terminates
the leases of all Shopping Center tenants similarly affected by the casualty.
18.7 Waiver of Inconsistent Statutes. Landlord and Tenant hereby waive any
statutory rights of termination which may arise by reason of any partial or
total destruction of the Premises .
ARTICLE 19
EMINENT DOMAIN
19.1 Total Taking. If the entire Premises shall be appropriated or taken
under the power of eminent domain by any public or quasi-public authority or
under threat of and in lieu of condemnation (hereinafter, "taken" or "taking"),
the Lease shall terminate as of the date of such taking, and Landlord and Tenant
shall have no further liability or obligation, except as otherwise provided for
in the Lease, arising under the Lease after such date.
19.2 Partial Taking; Right to Terminate. If more than twenty-five percent
(25%) of the Floor Area of the Premises is taken, or if by reason of any taking,
regardless of the amount so taken, the remainder of the Premises is not one
undivided space or is rendered unusable for the Permitted Use, either Landlord
or Tenant shall have the right to terminate the Lease as of the date Tenant is
required to vacate the portion of the Premises taken, upon giving notice of such
election within thirty (30) days after receipt by Tenant from Landlord of
written notice that said Premises have been or will be so taken. In addition, if
(a) such a significant portion of the Shopping Center or Common Area is taken
that, in Landlord's reasonable opinion, substantial restoration is required on
the remaining portion, or (b) Landlord exercises its right to terminate its
participation in the REA because of the taking of portions of the Shopping
Center other than the Premises, the Landlord shall have the right to terminate
the Lease upon thirty (30) days' written notice to Tenant. In the event of such
termination, both Landlord and Tenant shall be released from any liability or
obligation under the Lease, except as otherwise provided for in the Lease,
arising after the date of termination. Landlord and Tenant shall, immediately
after learning of any taking, give notice thereof to each other.
19.3 Restoration. If the Lease does not terminate pursuant to Sections 19.1
or 19.2 above, then Tenant shall continue to occupy that portion of the Premises
not taken and the parties shall proceed as follows: (a) at Landlord's cost and
expense and as soon as reasonably possible, Landlord shall restore the Premises
remaining to a complete unit of like quality and character as existed prior to
such appropriation or taking, and (b) the Minimum Annual Rent provided for in
Article 1 shall be reduced on an equitable basis, taking into account the
relative values of the portion taken as compared to the portion remaining.
Tenant waives any statutory rights of termination that may arise because of any
partial taking of the Premises.
19.4 Award. Landlord shall be entitled to the entire condemnation award for
any taking of the Premises, the Shopping Center or any part thereof. Tenant's
right to receive any amounts separately awarded to Tenant directly from the
condemning authority for the taking of its merchandise, Personal Property,
relocation expenses and/or interests in other than the real property taken
and/or the leasehold interest shall not be affected in any manner by the
provisions of this Section, provided Tenant's award does not reduce or affect
Landlord's award.
ARTICLE 20
SUBORDINATION; ATTORNMENT; ESTOPPEL
20.1 Subordination to Mortgage. The Lease and all of Tenants' rights
hereunder are and shall be subject and subordinate to the first Mortgage and any
secondary Mortgage approved by the first Mortgagee. The foregoing shall be self
operative without the execution of additional documentation, however, within
twenty (20) days after the receipt of a request from Landlord or any Mortgagee,
Tenant shall confirm such subordination by executing a recordable subordination
agreement in form and content reasonably satisfactory to Landlord and Landlord's
Mortgagee. Tenant acknowledges that any Mortgagee has the right to subordinate
at any time its Mortgage to this Lease and the leasehold estate, without
Tenant's consent. Tenant shall, within twenty (20) days after written request
therefor, execute and deliver such documents as are reasonably requested by the
Mortgagee to confirm such subordination.
Notwithstanding anything to the contrary contained herein, upon request
from Tenant, Landlord shall request from any party seeking such superior
position (with the exception of the existing Mortgagee) a non-disturbance
agreement and attornment agreement to the effect that so long as Tenant pays the
rentals due under this Lease and otherwise complies with the terms hereof,
Tenant's occupancy hereunder shall not be disturbed. In no event shall Tenant's
obligation to subordinate its rights hereunder be conditioned on the receipt of
such agreement. Tenant shall be responsible for payment of any costs incurred in
connection with obtaining the documentation requested hereunder.
20.2 Subordination to REA. Subject to Section 2.2, the Lease and all of
Tenant's rights hereunder are and shall be subject and subordinate to the REA
and any amendments or modifications thereof. If the REA is not of record as of
the date hereof, then the Lease shall automatically become subordinate to the
REA upon recordation of the REA, and with twenty (20) days after the receipt of
a request from Landlord or any Mortgagee, Tenant shall confirm such
subordination by executing a recordable subordination agreement in form and
content reasonably satisfactory to Landlord.
20.3 Attornment. If Landlord sells, transfers, or conveys its interest in
the Premises or the Lease, or if the same is foreclosed judicially or
nonjudicially, or otherwise acquired, by a Mortgagee, upon the request and at
the sole and absolute election of Landlord's successor, Tenant shall attorn to
said successor, provided said successor accepts the Premises subject to the
Lease. Tenant shall, upon request of Landlord or any Mortgagee, execute an
attornment agreement confirming the same, in form and substance reasonably
acceptable to Landlord or Landlord's successor. Such agreement shall provide,
among other things, that said successor shall not be bound by (a) any prepayment
of more than one (1) month's Rent (except Security Deposit but only to the
extent received by said successor) or (b) any material amendment of the Lease
made after the later of the Execution Date, or the date that such successor's
lien or interest first arose, unless said successor shall have consented to such
amendment. This Section 20.3 shall in no way be deemed a waiver by Tenant of any
Claims for any predecessor's failure or bad faith refusal to provide any
Security Deposit to its successor or to notify its successor of any amendment
prior to the date that such successor's lien or interest first arose.
20.4 Estoppel Certificate. Within twenty (20) days after request from
Landlord, Tenant shall execute and deliver to Landlord an Estoppel Certificate
with appropriate facts concerning the status of the Lease and Tenant's occupancy
completed by Landlord, and with any exceptions thereto noted in writing by
Tenant. Tenant's failure to execute and deliver the Estoppel Certificate within
said ten-day period shall be deemed to make conclusive and binding upon Tenant
in favor of Landlord, and any potential Mortgagee or transferee the statements
contained in such Estoppel Certificate without exception.
Landlord shall upon request from Tenant (in connection with a proposed
Occupancy Transaction under Article 15), but not more than twice per any
calendar year, execute a statement certifying that (i) this Lease represents the
entire agreement between Landlord and Tenant, and is unmodified and in full
force and effect (or, if modified, stating the nature of such modification and
certifying that this Lease, as so modified, is in full force and effect) and the
dates to which rental and other charges are paid in advance, if any, (ii)
certifying the commencement and termination dates of the Lease Term, and (iii)
acknowledging that there are not, to Landlord's knowledge, any uncured defaults
on the part of Tenant hereunder or specifying such defaults if any are claimed.
ARTICLE 21
QUIET ENJOYMENT
Landlord agrees that Tenant, upon paying the rent and performing the terms,
covenants, and conditions of the Lease, may quietly have, hold, and enjoy the
Premises from and after Landlord's delivery of the Premises to Tenant and until
the end of the Lease Term, subject, however, to those matters to which the Lease
is or shall become subordinate.
ARTICLE 22
CONSENTS
Wherever in the Lease consent, approval or permission (collectively
referred to in this Article as "consent") is required, such consent shall be
given in writing and shall not be unreasonably withheld or delayed, unless
otherwise expressly provided. Landlord shall not be deemed to have withheld its
consent unreasonably where Landlord's right to give its consent is conditioned
on Landlord obtaining the consent of any other person, entity, agency or
Governmental Authority and such other person, entity, agency or Governmental
Authority does withhold its consent. If Landlord fails to give any consent that
a court later holds Landlord was required to give under the terms of the Lease,
Tenant shall be entitled solely to specific performance and such other remedies
as may be specifically reserved to Tenant under the Lease, but in no event shall
Landlord be responsible for monetary damages (including incidental and
consequential damages) for such failure to give consent unless said consent is
withheld maliciously or in bad faith. The failure by Landlord to respond to any
request for consent shall in no event be deemed either approval or refusal by
Landlord.
ARTICLE 23
NOTICES
Wherever in this Lease it shall be required or permitted that any notice,
request, report, communication or demand (collectively, "notice") be given,
served or transmitted by either party to this Lease to or on the other, such
notice shall be in writing and shall be personally delivered or forwarded by
certified mail, return receipt requested, or by nationally recognized courier
service providing written confirmation of delivery, to the addresses of the
parties specified in Section 1.12. Notice shall be deemed to have been given or
served on the delivery date indicated by the United States Postal Service or
courier service on the return receipt or on the date such delivery is refused or
marked "undeliverable," unless Landlord or Tenant, as the case may be, is served
personally, in which event the date of personal delivery shall be deemed the
effective date of notice. Either party may change its address by providing
written notice as specified herein; provided, however, that all addresses
provided must be the actual street address of a residence or business
establishment. The foregoing method of service shall be exclusive, and Landlord
and Tenant waive, to the fullest extent permitted under law, the right to any
other method of service required by any statute or law now or hereafter in
force. Whenever multiple notices are sent or multiple methods of transmitting
any notice are utilized, any time period that commences upon the giving or
deemed giving of such notice shall commence upon the earliest date such delivery
is effectuated, and such time shall not be extended by operation of law or
otherwise because of any later delivery of the same notice.
ARTICLE 24
ATTORNEY FEES
If either Landlord or Tenant institutes any action or proceeding against
the other relating to the provisions of the Lease or any default hereunder, the
nonprevailing party in such action or proceeding shall reimburse the prevailing
party for the reasonable expenses of attorney fees and all costs and
disbursements incurred therein by the prevailing party, including, without
limitation, any such fees, costs or disbursements incurred on any appeal from
such action or proceeding. The prevailing party shall recover all such fees,
costs or disbursements as costs taxable by the court in the action or proceeding
itself without the necessity for a cross-action by the prevailing party. In
addition to the foregoing award of attorneys' fees, costs and disbursements to
the prevailing party, the prevailing party shall be entitled to its attorneys'
fees, costs and disbursements in any post judgment proceedings to collect or
enforce the judgment. This provision is separate and several and shall survive
the termination of the Lease.
ARTICLE 25
GENERAL PROVISIONS
25.1 Binding Effect. The parties hereto agree that all the provisions of
the Lease are to be construed as covenants and agreements and, except as
otherwise specified, that said provisions shall bind and inure to the benefit of
the parties hereto and their respective heirs, legal representatives,
successors, and assigns.
25.2 Right to Lease. Landlord shall have the absolute right to lease or
permit the use or occupancy of space in the Shopping Center as Landlord shall
determine in its sole and absolute judgment. Tenant does not rely on the fact,
nor does Landlord represent, that there shall be any specific occupants or
minimum occupancy level of space in the Shopping Center at any time (including,
without limitation, Major Tenants).
25.3 Shopping Center Configuration. Tenant acknowledges that Exhibit A is
for the purposes of convenience only and that, excluding any limitations set
forth in Section 7.5, Landlord reserves the right at any time to expand, reduce,
remove, demolish, change, renovate or construct any existing or new improvements
at the Shopping Center.
25.4 Claims by Brokers. Tenant warrants that all negotiations with respect
to the Lease (including, without limitation, preliminary consideration of the
Premises, relevant economics and final Lease provisions) were accomplished
without the aid, intervention or employment of any broker or finder, of any kind
(with the exception of BDH Associates). Tenant shall indemnify, protect, defend,
and hold Landlord (and its partners, joint venturers, affiliates, shareholders,
and property managers, and their respective officers, directors, employees, and
agents) harmless from and against any and all Claims arising out of or in
connection with any Claims made by any person claiming to be a broker or finder
representing Tenant with regard to the Lease including, without limitation,
Claims for commissions and all costs of enforcing this indemnity against Tenant.
25.5 Exhibits. All exhibits attached hereto are incorporated herein and
made a part of the Lease by reference as if fully set forth herein.
25.6 Entire Agreement; Amendments to Lease. There are no oral or written
agreements or representations between the parties hereto affecting the Lease not
contained herein. The Lease supersedes and cancels any and all previous
negotiations, arrangements, representations, brochures, displays, projections,
estimates, agreements, and understandings, if any, made by, to, or between
Landlord and Tenant and their respective agents and employees with respect to
the subject matter thereof, and none shall be used to interpret, construe,
supplement or contradict the Lease. The Lease, and all amendments thereto, shall
be considered to be the only agreement between the parties hereto and their
representatives and agents. To be effective and binding on Landlord and Tenant,
any amendment to the provisions of the Lease must be in writing and executed by
both parties in the same manner as the Lease itself. Any amendment to the Lease
shall be prepared by Landlord.
25.7 Force Majeure. The occurrence of any of the following events shall
excuse such obligations of Landlord or Tenant as are thereby rendered impossible
or reasonably impracticable for so long as such obligation remains impossible or
reasonably impracticable to perform: strikes, lockouts, labor disputes, acts of
God, inability to obtain labor, materials or reasonable substitutes therefor,
governmental restrictions, regulations or controls, judicial orders, enemy or
hostile governmental action, civil commotion, fire or other casualty, and other
causes beyond the reasonable control of the party obligated to perform.
Notwithstanding the foregoing (a) the occurrence of such events shall not excuse
Tenant's obligations to pay Rent or excuse such obligations as the Lease may
otherwise impose on the party to obey, remedy or avoid such event, provided,
however, that delays in opening for business resulting from reasons set forth
herein shall xxxxx Tenant's obligation to initially open for business and
commence payment of Rent for a period equal to the length of such delay, and
(b), should the work performed by Tenant or Tenant's contractor result in a
strike, lockout and/or labor dispute, such strike, lockout and/or labor dispute
shall not excuse Tenant's performance or obligation to pay Rent.
25.8 Venue. The laws of the state where the Shopping Center is located
shall govern the validity, performance, and enforcement of the Lease. Landlord
and Tenant consent to personal jurisdiction and venue in the state and judicial
district in which the Shopping Center is located.
25.9 Labor Disputes. Tenant shall construct, or cause Tenant's contractor
to construct, all Improvements in such a manner as to avoid any labor dispute
that causes or is likely to cause stoppage or impairment of work, deliveries or
any other services in the Shopping Center. If there shall be any such stoppage
or impairment as the result of any such labor dispute or potential labor
dispute, Tenant shall immediately undertake such action as may be necessary to
eliminate such dispute or potential dispute, including, without limitation, (a)
removing all disputants from the job site until such time as the labor dispute
no longer exists, (b) seeking a temporary restraining order and other injunctive
relief with regard to illegal union activities or a breach of contract between
Tenant and Tenant's contractor, and (c) filing appropriate unfair labor practice
charges.
25.10 Bankruptcy. Federal bankruptcy code shall govern with respect to the
Lease and in no event shall any provision of the Lease be deemed to be a waiver
by either party of its rights under such code.
25.11 No Presumption. Although the provisions of the Lease were drafted
primarily by Landlord, the parties hereto agree that such fact shall not create
any presumption, construction or implication favoring the position of either
Landlord or Tenant. The parties agree that any deletion of language from the
Lease prior to its execution by Landlord and Tenant shall not be construed to
have any particular meaning or to raise any presumption, construction or
implication, including, without limitation, any implication that the parties
intended thereby to state the opposite of the deleted language. The captions of
the Articles and Sections of the Lease are for convenience only, are not
operative parts of the Lease and do not in any way limit or amplify the terms
and provisions of the Lease.
25.12 No Waiver. The waiver by Landlord or Tenant of any breach of any
term, covenant or condition contained in the Lease shall not be deemed a waiver
of such term, covenant or condition of any subsequent breach thereof, or of any
other term, covenant or condition contained in the Lease. The consent to or
approval by Landlord or Tenant of any act by the other party requiring such
consent or approval shall not be deemed to waive or render unnecessary
Landlord's or Tenant's consent to or approval of any subsequent similar act by
the other party. Landlord's subsequent acceptance of partial Rent or performance
by Tenant shall not be deemed to be an accord and satisfaction or a waiver of
any preceding breach by Tenant of any term, covenant or condition of the Lease
or of any right of Landlord to a forfeiture of the Lease by reason of such
breach, regardless of Landlord's knowledge of such preceding breach at the time
of Landlord's acceptance. No term, covenant or condition of the Lease shall be
deemed to have been waived by Landlord or Tenant unless such waiver is in
writing and executed by such party.
25.13 Nondiscrimination. Landlord and Tenant covenant for themselves, their
heirs, executors, administrators, successors, and assigns and all persons
claiming under or through them, that there shall be no discrimination against or
segregation of any person or group of persons on account of race, color,
religion, creed, sex, marital status, sexual orientation, national origin,
ancestry, age, physical handicap or medical condition, in the leasing,
subleasing, transferring, use, occupancy, tenure or enjoyment of the Premises
herein leased, and Tenant and any person claiming under or through Tenant shall
not establish or permit any such practice or practices of discrimination or
segregation with reference to the selection, location, number, use or occupancy
of tenants, subtenants, licensees, vendees or customers in the Premises.
25.14 Parties. If two (2) or more persons or corporations execute the Lease
as Tenant, the word "Tenant" as used in the Lease shall refer to all such
persons or corporations, and the liability of such persons or corporations for
compliance with and performance of all the terms, covenants, and conditions of
the Lease shall be joint and several. The masculine pronoun used herein shall
include the feminine or the neuter, as the case may be, and the use of the
singular shall include the plural.
25.15 Real Estate Investment Trust. During the Lease Term or any extension
thereof, should a real estate investment trust become Landlord hereunder, all
provisions of the Lease shall remain in full force and effect except as modified
by this Section. If Landlord in good faith determines that its status as a real
estate investment trust under the provisions of the Internal Revenue Code of
1986, as heretofore or hereafter amended, will be jeopardized because of any
provision of the Lease, Landlord may request reasonable amendments to this
Lease, and Tenant will not unreasonably withhold, delay or defer its consent
thereto, provided that such amendments do not (a) increase the monetary
obligations, decrease the rights, or materially increase any other obligations,
of Tenant pursuant to the Lease or (b) in any other manner adversely affect
Tenant's interest in the Premises.
25.16 Relationship of the Parties. Nothing contained in the Lease shall be
deemed or construed as creating a partnership, joint venture, principal-agent,
or employer-employee relationship between Landlord and any other person or
entity (including, without limitation, Tenant) or as causing Landlord to be
responsible in any way for the debts or obligations of such other person or
entity.
25.17 Sale or Mortgage by Landlord. If Landlord, at any time, sells,
conveys, transfers or otherwise divests itself or is divested of its interest
("transfer") in the Premises, other than a transfer for security purposes only,
Landlord shall be relieved of all obligations and liabilities accruing hereunder
after the effective date of said transfer, provided that any Security Deposit or
other funds of Tenant then being held by Landlord are delivered to Landlord's
successor. The obligations to be performed by Landlord hereunder shall be
binding on Landlord's successors and assigns only during their respective
periods of ownership.
25.18 Severability. If any provision of the Lease shall be determined to be
void by any court of competent jurisdiction, then such determination shall not
affect any other provision of the Lease, and all such other provisions shall
remain in full force and effect. It is the intention of the parties hereto that,
if any provision of the Lease is capable of two constructions, one of which
would render the provision void and the other of which would render the
provision valid, then the provision shall have the meaning that renders it
valid.
25.19 Time of Essence. Time is of the essence in the performance of all
covenants and conditions of the Lease.
25.20 Waiver of Trial by Jury. Landlord and Tenant hereby waive any and all
rights to a trial by jury in any action, proceeding or counterclaim (including
any claim for injury or damage and any emergency and other statutory remedy in
respect thereof) brought by either against the other on any matter arising out
of or in any way connected with the Lease, the relationship of Landlord and
Tenant, and/or Tenant's use or occupancy of the Premises.
25.21 Warranty of Authority. Tenant represents, covenants, and warrants to
Landlord as of the Effective Date that the signatories signing on behalf of
Tenant have the requisite authority to bind Tenant. Further, if the Tenant is a
corporation, Tenant represents, covenants, and warrants to Landlord that: (a) as
of the Effective Date, Tenant is a duly constituted corporation in good standing
and qualified to do business in the state where the Shopping Center is located,
(b) Tenant has paid all applicable franchise and corporate taxes, and (c) Tenant
will file when due all forms, reports, fees, and other documents necessary to
comply with applicable laws.
25.22 Tenant Acknowledgment of Partner Status. Tenant hereby acknowledges
that one of the partners comprising Landlord is a unit of the California State
and Consumer Services Agency established pursuant to Title I, Division 1, Part
13 of the California Education Code, Sections 22000 et seq., as amended (the "Ed
Code"). As a result, Landlord may be prohibited from engaging in certain
transactions with a "school district or other employing agency" or a "member,
retirant, or beneficiary" (as those terms are defined in the Ed Code). In
addition, Landlord may be subject to certain restrictions and requirements under
the Internal Revenue Code, 26 U.S.C. Section 1 et seq. (the Code"). Accordingly,
Tenant represents and warrants to Landlord that : (a) Tenant is neither a school
district or other employing agency nor a member, retirant, or beneficiary; (b)
has not made any contribution or contributions to Landlord; (c) neither a school
district or other employing agency, nor a member, retirant, or beneficiary, nor
any combination thereof, is related to Tenant by any relationship described in
Section 267(b) of the Code; (d) neither Westmark Realty Advisors, its
affiliates, related entities, agents, officers, directors, or employees, nor any
Landlord's board member, employee, or internal investment contractor
(collectively, "Landlord's Affiliates") has received or will receive, directly
or indirectly, any payment, consideration, or other benefit from, nor does any
Landlord Affiliate have any agreement or arrangement with Tenant or any person
or entity affiliated with Tenant relating to, the transactions contemplated by
the Lease; and (e) except for the ownership of Tenant's publicly traded stock,
no Landlord Affiliate has any direct or indirect ownership interest in Tenant or
any person or entity affiliated with Tenant.
25.23 Tenant's Option to Lease Additional Premises. Tenant is hereby given
the option to lease additional premises currently identified as "Space No.
1-M-007" ("Additional Premises") in the Shopping Center. Such option shall be
exercised, if at all, by Tenant giving written notice ("Option Notice") to
Landlord no later than November 30, 1999 but no earlier than October 1, 1999,
however, in the event Landlord gives Tenant written notification that the
Additional Premises will be available at a date prior to October 1, 1999, Tenant
shall be required to provide Landlord with the Option Notice, if at all, within
thirty (30) days of the date Landlord's notice is given.
In the event Tenant exercises this option to lease the Additional Premises,
Landlord shall amend the Lease to lease Tenant the Additional Premises,
effective upon the date Landlord delivers possession of the Additional Premises
to Tenant, on the same terms and conditions as those contained in this Lease for
the balance of the remaining Lease Term. Effective on the earlier of the date
Tenant opens for business within the Additional Premises or the seventy-fifth
(75th) day following the date Landlord delivers possession of the Additional
Premises to Tenant, the Minimum Annual Rent and Marketing Assessment shall be
adjusted to include the Additional Premises at the same per square foot rates
Tenant is required to pay according to the terms of this Lease. Tenant shall be
required to submit to Landlord plans and specifications for the remodeling of
Tenant's storefront and store interior in accordance with Exhibit C and the
Tenant Package. Landlord shall respond to Tenant's Plans within fifteen (15)
days of the receipt of same by notifying Tenant of (a) the approval of Tenant's
Plans, or (b) the reason(s) why Tenant's Plans are not satisfactory to Landlord.
Tenant shall commence and diligently proceed with construction so as to complete
the work on or before the seventy-fifth (75th) day following the date Landlord
delivers possession of the Additional Premises to Tenant. Notwithstanding
anything contained herein, in the event Landlord's response is delayed beyond
the fifteenth (15th) day required hereinabove, Tenant's requirement to complete
the work within seventy-five (75) days following the date Landlord delivers
possession of the Additional Premises shall be delayed by the corresponding
number of days after the fifteenth (15th) day.
Tenant's option to lease Additional Premises shall be null and void in the
event any of the following occurs:
(a) Tenant is in default, beyond any applicable cure period, in its
obligations under this Lease on the date of the Option Notice, in which case
such Option Notice shall be totally ineffective;
(b) Tenant is in default, beyond any applicable cure period, in its
obligations under this Lease on the date Landlord delivers possession of the
Additional Premises to Tenant, in which case the amendment to the Lease to lease
Tenant the Additional Premises shall also be null and void; and
(c) Landlord is unable to deliver the additional premises to Tenant by
October 1, 2000.
This option to lease Additional Premises shall not be effective or
available to a Transferee in the event of a permitted Occupancy Transaction
pursuant to Article 15 of this Lease, except a permitted Transferee pursuant to
Section 15.8. In addition, this option to lease the Additional Premises shall
not be operative in the event of foreclosure or the giving of a deed in lieu of
foreclosure, and will be of no force or effect to such successor in interest.
25.24 Tenant's Financial Statements. On a quarterly basis, Tenant shall
submit copies of Tenant's Form 10-QB quarterly report to Landlord, in care of
the Chief Financial Officer of TrizecHahn Centers (or any other individual
Landlord notifies Tenant of in writing at a later date), at the address
specified in Section 1.12 within sixty (60) days of filing said report with the
Securities and Exchange Commission pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934. Failing or refusing to comply with this Section
25.24 within ten (10) days of Landlord's written request, shall constitute a
default by Tenant and a breach of this Lease.
ARTICLE 26
SECURITY DEPOSIT
26.1 Payment. On or before the Effective Date, Tenant shall pay Landlord
the Security Deposit as security for the faithful performance by Tenant of all
of its obligations under this Lease. Landlord shall not be required to hold the
Security Deposit and, if Landlord does hold the Security Deposit, Landlord shall
not be liable for interest, except as required herein and shall not be required
to hold the Security Deposit in a segregated account except as may be required
by applicable law or any Mortgagee. Anything to the contrary notwithstanding
contained in Article 26, upon receipt from Tenant of the sum of Thirty-Three
Thousand Three Hundred Sixty-Eight and 75/100 Dollars ($33,368.75), Landlord
shall deposit such sum in an interest bearing account with a federally insured
bank or savings and loan association. Landlord shall hold the account as a
Security Deposit under the terms and conditions set forth in Article 26. All
interest or earnings accruing on Tenant's Security Deposit from said account
shall be paid to Tenant at the end of each year of the Lease Term, within thirty
(30) days of Tenant's written request therefor, provided Tenant is not, and has
not been, in default under the terms of the Lease during the preceding year.
26.2 Application. If any of the rentals herein reserved or any other sum
payable by Tenant to Landlord shall be overdue and unpaid or paid by Landlord on
behalf of Tenant, or if Tenant shall fail to perform any of its obligations
under the Lease, then Landlord may, at its option and without prejudice to any
other remedy which Landlord may have on account thereof, appropriate and apply
all or a portion of the Security Deposit to compensate Landlord for Minimum
Annual Rent, Additional Rent, loss or damage sustained by Landlord, and Tenant
shall forthwith restore said Security Deposit to the original sum deposited.
Should Tenant comply with all of said obligations and promptly pay all the
rentals when due and all other sums payable by Tenant to Landlord, the Security
Deposit shall be refunded in full to Tenant at the expiration or earlier
termination of the Lease Term, subject to the provisions of Section 26.3.
26.3 Return of Security Deposit. Provided Tenant (i) initially opens for
business within sixty (60) days of the time limits set forth in Section 11.1;
(ii) is not currently in default, which default remains uncured for the time
period set forth in Section 16.2, nor has been in default of any of the terms or
provisions of this Lease during the Lease Term beyond the time period to cure as
set forth in Section 16.2; (iii) is the tenant entity specified in Article 1, or
any permitted Transferee pursuant to Article 15, Section 15.8 of this Lease; and
(iv) has a net worth and working capital equal to or greater than Tenant's net
worth and working capital as of the Effective Date, then at the end of the
thirty-sixth (36th) full month of the Lease Term and upon Tenant's written
request, Landlord shall apply the Security Deposit to Tenant's Minimum Annual
Rent beginning with the Minimum Annual Rent due on the first (1st) day of the
calendar month following Landlord's receipt of Tenant's written request and
continuing each subsequent month until the entire Security Deposit has been
exhausted and further provided that during the months the Security Deposit is
applied to Minimum Annual Rent, Tenant shall pay all other charges called for in
the manner provided for in this Lease. In the event Tenant is or has been in
default beyond the time period to cure as set forth in Section 16.2, does not
comply with the conditions set forth in this Lease, or if Tenant's net worth and
working capital is not equal to or greater than Tenant's net worth and working
capital as of the Effective Date, the Security Deposit shall be retained by
Landlord until the expiration or earlier termination of this Lease.
THE OAKS SHOPPING CENTER, L.P.,
a California limited partnership
By Command Properties Corporation,
a Delaware corporation,
as general partner
By: TrizecHahn Centers Management Inc.,
a California corporation,
as its attorney-in-fact
By:
Name:
Title:
By:
Name:
Title:
By: California State Teachers' Retirement System,
a retirement system organized under the
laws of the State of California,
as general partner
By: Westmark Realty Advisors,
a limited liability company
By:
Xxxxxxxxxxx X. Xxxxxx
National Director
By:
Name:
Title:
LANDLORD
TOYS INTERNATIONAL,
a California corporation
By:
Name:
(Type or Print Name)
Title:
By:
Name:
(Type or Print Name)
Title: TENANT
EXHIBIT B
DEFINED TERMS
Unless otherwise indicated, all references to Articles and Sections shall
be deemed to refer to Articles and Sections of the Lease.
"Additional Rent" means all sums of money required to be paid by Tenant
under the Lease with the exception of Minimum Annual Rent.
"Administrative Fee" means an amount equal to fifteen percent (15%) of the
amount of expenses or other amounts with respect to which the Administrative Fee
is payable as set forth in particular Articles and Sections of the Lease.
"Air Conditioning Charge" is defined in Section 6.5.
"Air Conditioning System" means the air conditioning system serving the
Premises either exclusively or in common with other tenants of the Shopping
Center, including all pipes, ducts, machinery, fans, coolers, chillers,
condensers, and other equipment used in connection therewith.
"Amortization of Capital Items" shall mean the amortization of any capital
item costing Twenty-Five Thousand Dollars ($25,000) or more with a useful life
(as determined in accordance with generally accepted accounting principles) in
excess of five (5) years. Amortization shall be, in lieu of the full cost of
such item, over said useful life and shall include an interest factor based on
the Interest Rate.
"Breakpoint" for any specific period means the amount obtained by dividing
the Minimum Annual Rent payable during such period by the percentage set forth
in Section 1.10 for the calculation of Percentage Rent.
"CFM" means cubic feet of air per minute.
"CPI Adjustment Procedures" shall mean the method by which adjustments
shall be made to a sum of money Tenant must pay Landlord ("Base Amount") in
accordance with percentage increases, if any, in the Department of Labor, Bureau
of Labor Statistics, Consumer Price Index for All Urban Consumers, U.S. City
Average, Subgroup "All Items" (1982-84 = 100), referred to herein as the
"Index." The procedure for making such adjustments shall be to increase the Base
Amount by a percentage equal to the percentage increase, if any, in the Index
for the Month of Adjustment as compared to the Index for the Base Month. The
terms "Month of Adjustment" and "Base Month," as used herein, are defined in the
applicable Articles of the Lease. If at any time there is no Index, Landlord
shall substitute any official index published by the Bureau of Labor Statistics
or by such successor or similar governmental agency as may then be in existence
and shall be most nearly equivalent thereto.
"Change of Control" means the transfer by sale, assignment, death,
incompetency, mortgage, deed of trust, trust, operation of law, or otherwise of
any shares, voting rights or ownership interests which will result in a change
in the identity of the person or persons exercising, or who may exercise,
effective control of Tenant, unless such change results from the trading of
shares listed on a recognized public stock exchange . If Tenant is a private
corporation whose stock becomes publicly held, the transfers of such stock from
private to public ownership shall not be deemed a Change of Control.
Notwithstanding the foregoing to the contrary, any transfer of stock in Tenant's
corporation between present stockholders, to family members of present
stockholders, or for bona fide estate planning purposes shall not be deemed a
Change of Control so long as the Tenant entity does not change as a result of
such transfer.
"Claims" means any claim, demand, investigation, proceeding, action, suit,
judgment, award, fine, lien, loss, damage, expense, charge or cost of any kind
or character and liability (including reasonable attorney fees and court costs).
"Commencement Date" means the earlier to occur of (i) the date Landlord
tenders possession of the Premises to Tenant or Tenant's agent or (ii) the date
Tenant or Tenant's agent occupies the Premises for any purpose.
"Common Area" means all improved and unimproved areas within the boundaries
of the Shopping Center (including additional land acquired by Landlord) which
are made available from time to time for the general use, convenience, and
benefit of Landlord, other persons entitled to occupy any portion of the
Shopping Center and/or their customers, patrons, employees, and invitees,
including, without limitation, all automobile parking areas and structures,
floors, ceilings, roofs, skylights, windows, driveways, open or enclosed malls,
food court seating areas, sidewalks, curbs, and landscaped areas, and such
public transportation facilities and landscaped areas as are contiguous with and
benefit the Shopping Center.
"Common Area Expenses" is defined in Section 7.3.
"Construction Allowance" means that amount, if any, payable by Landlord in
accordance with Exhibit C-Addendum.
"Effective Date" means the earlier of (i) the Execution Date or (ii) the
Commencement Date.
"Encumbrance" means any conditional, contingent or deferred assignment,
sublease or conveyance voluntarily made by Tenant of some or all of Tenant's
interest, rights or duties in the Lease or the Premises, including Tenant's
right to use, occupy or possess the Premises, in whole or in part, including,
without limitation, any mortgage, deed of trust, pledge, hypothecation, lien,
franchise, license, concession or other security arrangement.
"Engineered Value" means the total CFM, or the total GPM, which Tenant has
calculated under Exhibit F as necessary for supply to the Premises, or which
have been calculated as necessary for supply to other leasable premises in the
Shopping Center.
"Estoppel Certificate" means a document stipulation substantially in the
form of Exhibit E.
"Execution Date" means that date set forth in the first paragraph of the
Lease upon which the Lease is fully executed by Landlord and Tenant.
"Expiration Date" means that date set forth in Section 1.7.
"Floor Area" means the square footage of the Premises described in Article
1 (or, where applicable, of other premises located in a building or buildings of
the Shopping Center) without deduction for the width of or space occupied by air
conditioning units that exclusively serve and are located within the Premises
and/or by columns, sprinkler risers, roof drains, structural braces, expansion
joints and/or shear walls, measured from the exterior surface of building walls
(and extensions thereof, in the case of openings), from the exterior surface of
Perimeter Demising Partitions, from the center line of Interior Demising
Partitions or vertical neutral strips and from any Lease Line, all of which form
the perimeter of the Premises.
"Food Court" means that area, if any, of the Shopping Center for which
specific Common Area is designated by Landlord, in its sole and absolute
discretion, for the purpose of providing facilities to accommodate the
consumption of food and beverages by customers of food use tenants in the
Shopping Center.
"Food Court Expenses" means Common Area Expenses which are attributable
solely to the operation and use of the Food Court.
"GPM" means gallons of water or fluid per minute.
"Governmental Authority" means any federal, state, county, city or local
governmental board, body or agency having jurisdiction over the Premises or the
Shopping Center or any part thereof.
"Gross Sales" means the proceeds of all sales and/or other revenue derived
or made from the Premises adjusted to exclude or deduct, as applicable, Gross
Sales Adjustments and including, without limitation, merchandise, goods and/or
services sold, leased, licensed or otherwise transferred in or from the Premises
by Tenant, its subtenants, licensees, and concessionaires, whether for cash or
on credit and whether made by store personnel or by approved vending or gaming
machines. Gross Sales shall not include any government imposed taxes upon the
sale of merchandise or services which are collected separately from the selling
price and paid directly to the taxing authority. All sales and/or revenue
originating at the Premises shall be considered Gross Sales, even though
bookkeeping and payment of the account may be transferred to another place for
collection and even though actual filling and/or delivery of the merchandise may
be made from a place other than the Premises. Each sale upon installments or
credit shall be treated as a sale for the full sale price at the time of sale.
Gift Certificates shall be included in Gross Sales upon the redemption of same
at the Premises.
"Gross Sales Adjustments" means the following items but same shall be
deducted (as opposed to excluded) from Gross Sales only to the extent previously
reported as Gross Sales: interest, service or sales carrying charges collected
separately from the selling price and paid by customers to Tenant for extension
of credit; the selling price of all merchandise returned by customers and
accepted for full credit or the amount of discounts made thereon; sums and
credits received in the settlement of Claims for loss or damage to merchandise;
the price allowed on merchandise traded in by customers for credit or the amount
of credit for discounts and allowances made in lieu of acceptance thereof;
alteration workroom charges and delivery charges at Tenant's cost and collected
separately from the selling price; receipts from vending machines installed
solely for Tenant's employees; transfers of merchandise between Tenant's stores,
and sales of fixtures, equipment or property which are not stock in trade. In
addition, the following may be included as a Gross Sales Adjustment (but shall
be deducted, as opposed to excluded, from Gross Sales only to the extent
previously reported as Gross Sales); provided that (i) through (iii) below shall
not exceed a total of two percent (2%) of Tenant's Gross Sales in any single
calendar year:
(i) Bad checks and/or debts, provided that if subsequently collected, said
checks and/or debts shall be included within Gross Sales in the calendar year in
which subsequently collected;
(ii) The discount permitted on sales to employees actually employed at the
Premises; and
(iii) Fees paid by Tenant to credit card companies and/or banking
institutions in accordance with credit card purchase plans.
"Hazardous Materials" means any chemical, compound, material, substance or
other matter that: (a) is defined as a hazardous substance, hazardous material
or waste, or toxic substance under any Hazardous Materials Law, (b) is
regulated, controlled or governed by any Hazardous Materials Law or other Legal
Requirement, (c) is petroleum or a petroleum product, or (d) is asbestos,
formaldehyde, radioactive material, drug, bacteria, virus, or other injurious or
potentially injurious material (by itself or in combination with other
materials).
"Hazardous Materials Laws" means any and all federal, state or local laws,
ordinances, rules, decrees, orders, regulations or court decisions relating to
hazardous substances, hazardous materials, hazardous waste, toxic substances,
environmental conditions on, under or about the Premises or the Shopping Center,
or soil and ground water conditions, including, but not limited to, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
the Resource Conservation and Recovery Act, the Hazardous Materials
Transportation Act, the California Hazardous Waste Control Act, the
Xxxxxxxxx-Xxxxxxx-Xxxxxx Hazardous Substances Account Act, the Xxxxxx-Cologne
Water Quality Control Act, any other Legal Requirement concerning hazardous or
toxic substances, and any amendments to the foregoing.
"Improvements" means all permanent and nonstructural fixtures,
installations, alterations, replacements, additions, changes and/or improvements
to the Premises.
"Insured Casualty" means damage or destruction the repair of which is
covered to the extent of at least fifty percent (50%) of the replacement cost
thereof (with deductibles, self-insurance and co-insurance being deemed to be
"covered") by insurance proceeds received by or made available to Landlord
pursuant to any insurance policy actually carried or required to be carried by
Landlord under the terms of the Lease.
"Interest Rate" means the lesser of (i) the maximum lawful rate permitted
by usury or similar law in the State in which the Shopping Center is located to
be charged by Landlord to Tenant, or (ii) two percent (2%) above the annualized
rate of interest publicly announced from time to time by Bank of America NT&SA
in San Francisco, California, as its "prime rate" or "reference rate," and such
interest shall be computed on the basis of monthly compounding with actual days
elapsed compared to a 360-day year.
"Interior Demising Partitions" means partitions separating the Premises
from adjacent space occupied or intended to be occupied by another tenant.
"Interior Mall" means that portion of the Common Area, if any, which is
located in the interior facing portion of the Shopping Center.
"Interior Mall Expenses" shall mean Common Area Expenses which are
attributable solely to the operation and use of the Interior Mall.
"Landlord" is defined in Article 1.
"Landlord's Work" is defined in Exhibit C. "Lease Line" means any imaginary
or defined line which separates the Premises from all areas of the Shopping
Center other than the premises of adjacent tenants and which is shown in the
Tenant Package.
"Lease Term" is defined in Section 3.1.
"Legal Requirement" means, to the extent applicable, (i) any law, statute,
ordinance, regulation, rule, requirement, order, court decision or procedural
requirement of any Governmental Authority, (ii) the rules and regulations of the
applicable governmental insurance authority or any similar body, (iii) the
requirements of the REA, and (iv) the reasonable requirements of any Mortgagee.
References herein to "law" or "lawful" include Legal Requirements or the full
and strict compliance with Legal Requirements, as applicable.
"Major Department Stores" means those certain buildings or premises (or the
occupants thereof) indicated on Exhibit A as "DEPT. STORES" (or similar
designation) and which may be subsequently added, substituted or removed at
Landlord's sole and absolute discretion without notice to Tenant or amendment to
Exhibit A.
"Major Destruction" means destruction (whether or not an Insured Casualty)
to an extent of more than one-third (33-1/3%) of the full replacement cost of
the Premises or Shopping Center, as the case may be, as of the date of
destruction, or destruction to the Shopping Center that results in the
termination of the leases of tenants therein representing more than one-third
(33-1/3%) of the Floor Area thereof, or results in the termination of the lease
and/or operation of one or more Major Department Stores.
"Major Tenants" means collectively (i) the Major Department Stores, (ii)
any premises (or the occupants thereof) at the Shopping Center used primarily
for events, meetings, and operations conducted on a nonprofit basis for the
benefit of the community, and (iii) premises (or the occupants thereof) that
contain at least twenty thousand (20,000) square feet of contiguous (i.e., not
separated by Interior Demising Partitions) Floor Area.
"Mall Tenants" means those tenants occupying premises in the Shopping
Center that front onto the Interior Mall.
"Marketing Assessment" means the sum payable by Tenant as set forth in
Section 1.11 and provided for in Article 8.
"Marketing Fund" is defined in Section 8.1.
"Merchants' Association" is defined in Section 8.1.
"Minimum Annual Rent" means the rental payable by Tenant for the use and
occupancy of the Premises and is more specifically set forth in Section 1.9.
"Mortgage" means any mortgage, deed of trust, assignment, security
agreement, conditional sale contract or other encumbrance or hypothecation of
any of Landlord's interest in the real and personal property comprising the
Shopping Center (including all subsequent amendments, modifications, and
advances thereto), including an assignment or encumbrance of Landlord's interest
in the Lease and the rents and profits derived therefrom. "Mortgage" shall also
include any ground lease or similar instrument whereby Landlord holds a
leasehold interest in the Shopping Center or any part thereof. "Mortgagee" means
the holder/trustee, beneficiary or assignee of any Mortgage, or any lessor under
any ground lease or similar instrument.
"Occupancy Transaction" means any Transfer, Encumbrance, Change of Control,
or other arrangement whereby the identity of the person or persons using,
occupying or possessing the Premises changes or may change, whether such change
be of an immediate, deferred, conditional, exclusive, nonexclusive, permanent or
temporary nature.
"Percentage Rent" means the rental payable by Tenant as set forth in
Section 1.10 and pursuant to Section 4.4.
"Perimeter Demising Partitions" means partitions separating the Premises
from the Common Area.
"Permitted Use" means the permitted use of the Premises as set forth in
Section 1.13.
"Personal Property" means trade fixtures, furniture, furnishings, signs,
and other personal property not permanently affixed to the Premises.
"Premises" means the commercial space described in Section 1.4 from the top
of the floor to the underside of the structure above and exclusive of such
conduits, facilities, and structures as may be located in the Premises for the
use and benefit of Landlord and/or other tenants.
"REA" means that certain document entitled "Construction, Operation and
Reciprocal Easement Agreement" (or such other similar title) respecting the
certain rights and obligations of the owner or owners of the real property
comprising all or a portion of the Shopping Center, which has been or will be
recorded against such real property and as amended, supplemented and/or restated
from time to time.
"Reconstruction" means demolition, stabilization, repair, reconstruction,
and restoration of the Premises, Building or Shopping Center, as the case may
be, resulting from an Insured Casualty or Uninsured Casualty.
"Rent" means all amounts of Minimum Annual Rent and Additional Rent
required to be paid by Tenant under the Lease.
"Rent Commencement Date" means that date determined as set forth in Section
1.8.
"Responsible Officer" of Tenant shall mean all individuals doing business
as Tenant, an individual general partner if Tenant is a partnership, a
responsible officer of Tenant if Tenant is a corporation, or a responsible
officer of any corporate general partner of Tenant if Tenant is a partnership
with one or more corporate partners.
"Security Deposit" means the amount, if any, specifically set forth in
Section 1.14.
"Shopping Center" means that commercial property named in Section 1.4 of
the Lease, as the same may from time to time be expanded, reduced, altered,
reconstructed or otherwise changed.
"Target Delivery Date" means that date set forth in Section 1.6.
"Tenant Package" means (i) the tenant design manual/package and (ii)
technical handbook setting forth specific criteria for Tenant's Work, as either
may be amended from time to time. The Tenant Package shall provide for
architectural, construction, mechanical, and Utilities standards, specifications
and criteria established by Landlord, from time to time, for the Shopping
Center, including, without limitation, standards, specifications, and criteria
for storefronts, interior improvements, and signs.
"Tenant's Work" is defined in Exhibit C and the Tenant Package.
"Tenant's Plans" means calculations, specifications, designs, and drawings
which pertain to Tenant's Work and/or other Improvements and which are described
in Exhibit C, Section I, Paragraph B.
"Trade Name" means the name set forth in Section 1.3.
"Transfer" means any voluntary, unconditional, and present (i) assignment
of some or all of Tenant's interest, rights, and duties in the Lease and the
Premises, including Tenant's right to use, occupy, and possess the Premises, or
(ii) sublease of Tenant's right to use, occupy, and possess the Premises, in
whole or in part.
"Transferee" means the proposed assignee, sublessee, mortgagee,
beneficiary, pledgee or other recipient of Tenant's interest, rights or duties
in the Lease or the Premises in an Occupancy Transaction.
"Uninsured Casualty" means damage or destruction that is not an Insured
Casualty.
"Utilities" means the services of sewage removal, delivery of water,
electricity, natural gas (if permitted by Landlord), telephone service and other
services such as satellite data transmission, cable systems, and security
systems.
"Utilities Charge" is defined in Section 6.3.
"Utility Installations" means any and all systems, machinery, facilities,
installations, supply lines, transformers, pipes, conduits, ducts, penetrations,
components, appurtenances, and equipment used in or in connection with the
Shopping Center for the generation or supply of Utilities.
EXHIBIT C
PROVISIONS RELATING TO THE DESIGN AND CONSTRUCTION OF TENANT'S STORE;
DESCRIPTION OF LANDLORD'S WORK IN THE EVENT OF RECONSTRUCTION
I. General Requirements
A. Tenant Package. Tenant acknowledges receipt of the Tenant Package for
the purpose of the initial construction of the Premises.
B. Tenant's Plans.
1. Prior to Tenant preparing Tenant's Plans, Tenant's architect and
engineer(s) shall thoroughly familiarize themselves with, and verify by physical
inspection, the accuracy of the Premises, the Tenant Package, this Exhibit C,
all local building codes and all existing job conditions. Tenant's Plans and
construction shall be prepared and performed with full knowledge of and in
compliance with the Tenant Package, this Exhibit C and all Legal Requirements,
including without limitation all energy conservation, Hazardous Materials Laws,
and handicap access requirements. Tenant's Plans shall be prepared or, if
permitted by law, sealed by architect(s) and engineer(s) fully qualified and
licensed in the state in which the Shopping Center is located.
2. Within twenty (20) days after receipt of the Tenant Package, Tenant
shall submit to Landlord fully detailed and dimensioned 1/2" scale preliminary
storefront drawings. This preliminary submittal shall include the following: (a)
three (3) sets of prints and one (1) sepia that show storefront elevations,
sections through the storefront and storefront signage, (b) one (1) material
sample and color board, and (c) one (1) completely colored rendering of Tenant's
storefront design.
3. No later than June 26, 1998, Tenant agrees to submit to Landlord six (6)
sets of prints and one (1) sepia of fully detailed and dimensioned 1/4" scale
architectural and structural construction drawings, which shall include the
following: (a) plan views of the storefront, floor areas, and reflected ceiling;
elevations of the storefront and interiors, sections through the storefront and
partitions and along the longitudinal axis, door, finish, and color schedules,
and final design drawings for storefront signs in accordance with the Tenant
Package, (b) electrical drawings including circuitry plans, panel schedules,
riser diagrams, load calculations, and all calculations and forms required by
applicable Legal Requirements, and (c) mechanical drawings, including heating,
ventilating, and air conditioning design calculations, an equipment schedule and
specifications, the design for the air distribution duct work system, smoke
exhaust system, exhaust fan(s), plumbing fixtures and piping specifications, and
all calculations and completed forms required by applicable Legal Requirements.
C. Approval of Tenant's Plans.
1. Tenant's Plans, and the design and quality of all work and installations
undertaken by Tenant in the Premises, shall be subject to the approval of
Landlord and Landlord's architect and engineers. Landlord shall respond to
Tenant's Plans within fifteen (15) days of the receipt of same by notifying
Tenant of (a) the approval of Tenant's Plans, or (b) the reason(s) why Tenant's
Plans are not satisfactory to Landlord.
2. If said plans are not approved because they do not conform to the Tenant
Package, Landlord will state the reasons for nonconformance and Tenant will be
given twenty (20) days to resubmit another set of plans taking into account
Landlord's suggested changes. If these subsequent drawings are not approved,
within ninety (90) days after full execution and delivery of this Lease by both
parties, Landlord shall have no further obligation to approve said plans and
Landlord shall have the right to terminate this Lease. 3. Landlord's architect's
approval of Tenant's Plans shall not create any responsibility or liability on
the part of Landlord for their completeness, sufficiency, design or compliance
with Legal Requirements, and shall not relieve Tenant of any of Tenant's
responsibility or liability hereunder.
4. Any changes to the approved Tenant's Plans requested by Tenant shall be
subject to Landlord's approval and shall be reviewed by Landlord's architect.
Tenant shall pay any additional expenses incurred in connection with such
processing, including any additional fees of Landlord's architect, which costs
shall be deposited by Tenant at the option of Landlord prior to the commencement
of such processing.
D. Requirements for Tenant's Improvements.
1. Tenant's Work and all other Improvements shall be made under the
supervision of a competent architect or licensed structural engineer and made in
accordance with the approved Tenant's Plans. At Tenant's sole cost, Landlord
shall have the right, but not the obligation, to perform any work that Tenant
shall have failed to construct in accordance the approved Tenant's Plans, after
ten (10) days' notice from Landlord. Tenant, at its sole cost and expense, shall
be responsible for obtaining all necessary permits including building and health
department permits for the performance of such work and for the payment of any
impact, capacity, usage, and/or similar fee in connection with such work. Upon
completion of such work, Tenant shall have recorded in the office of the County
Recorder where the Shopping Center is located a Notice of Completion, as
required or permitted by law, and Tenant shall deliver to Landlord, within ten
(10) days after completion of said work, a copy of the final signed-off building
inspection card, permit or report with respect thereto and the Certificate of
Occupancy. All work shall be performed and completed strictly in accordance with
all Legal Requirements in a good and workmanlike manner, and shall be diligently
prosecuted to completion. The Premises shall at all times be a complete unit,
except during the period of work, and Tenant shall perform all such work so as
not to obstruct access to the premises of any other tenant in the Shopping
Center.
2. Tenant shall not open for business in the Premises until the Premises
fully and strictly comply with the approved Tenant's Plans and all Legal
Requirements, in the reasonable judgment of Landlord or Landlord's architect.
3. During the performance of Tenant's Work, Tenant shall be responsible for
the removal from the Shopping Center on a daily basis of all trash, construction
debris and surplus construction materials.
Tenant shall, at its sole cost and expense, provide trash receptacles for
Tenant's use during Tenant's construction. Landlord shall have the right to
approve the placement location of such receptacles. In no event shall Tenant use
any trash receptacles during construction other than those that Tenant has
provided.
II. Description Of Tenant's Work
A. General. "Tenant's Work" shall mean the purchase and/or installation of
all of the Improvements described in this Section II and any other Improvements
or work necessary to construct and complete construction of Tenant's store. All
costs of Tenant's Work shall be paid for by the Tenant regardless of whether or
not Tenant actually performed the work.
B. Ceilings. Tenant shall install all ceilings.
C. Partitions.
1. Tenant shall install all interior partitions and curtain walls within
the Premises required by the building code and as shown in Tenant's Plans.
2. Tenant shall plaster or drywall and firetape the interior side of all
Interior Demising Partitions and Perimeter Demising Partitions over their entire
area, except for necessary openings as designated in the Tenant Package.
3. All of Tenant's partition construction work shall be completed so as to
satisfy applicable fire rating requirements.
D. Floor. Tenant shall install all floor coverings within the Premises.
E. Plumbing.
1. Tenant shall install all plumbing fixtures and rough-in plumbing.
Tenant's plumbing contractor shall provide approved receptors for air
conditioning condensate drains and water heater overflow as required.
2. Grease traps will be required for all food preparation areas having pot
sinks or any grease-producing appliances that discharge into the waste system.
3. Subject to obtaining Landlord's prior written consent, which Landlord
may grant or withhold in its sole and absolute discretion, Tenant may use
natural gas on the Premises in accordance with such terms and conditions as
Landlord may specify. If Landlord grants its consent to the use of natural gas
in the Premises, Landlord shall either perform the work to bring gas service to
the Premises (in which case Tenant shall reimburse Landlord for the cost of such
work), or require Tenant to perform such work at a location designated by
Landlord.
F. Sprinklers. At Tenant's expense, Landlord's contractor (or at Landlord's
option Tenant's contractor) shall make such additions, modifications, or
relocations to the sprinkler system installed by Landlord required by the design
or construction of Tenant's Improvements or to bring the same into compliance
with the requirements of Landlord's insurance underwriters and all Legal
Requirements. The costs of any work performed by Landlord's contractor, at
Tenant's expense, shall be competitive with commensurate contractors serving the
same trade area.
G. Air Conditioning/Heating. All air conditioning and heating work required
by Tenant shall be at Tenant's sole cost and expense. All such air conditioning
and heating work shall be designed and installed by Tenant unless designed and
installed, at Landlord's option, by Landlord at Tenant's sole cost and expense.
This work shall include, without limitation, additional air conditioning, if
any, connection to supply and return lines, duct work, and any controls or
circuitry required. At Landlord's option, Tenant shall provide heating to the
Premises in accordance with the Tenant Package. Notwithstanding anything to the
contrary contained in the Lease and Exhibits, if Tenant's business produces
odor, fume and/or grease or involves food preparation, at Landlord's option,
Tenant shall, at its sole cost and expense, design and install an independent
Air Conditioning System designed to mitigate the problems caused by such
operations. The Air Conditioning System serving the Premises shall be designed
to cool air automatically. The Tenant shall maintain conditions inside the
Premises as follows: 75? Fahrenheit dry bulb and 50% relative humidity with
outside conditions of 93? Fahrenheit dry bulb and 70? Fahrenheit wet bulb.
H. Electrical. Tenant shall install all electrical and telephone work
required within the Premises, including, without limitation, the following:
1. Feeders and other work from the central distribution point, light
fixtures, transformers, electrical panels, disconnect switches, distribution
within the Premises and additional conduit(s) from the central distribution
point, as required.
2. Temporary power for Tenant's construction.
3. Tenant, at its expense, shall arrange for electrical and telephone
service and installation of an electrical meter by the local utility company in
sufficient time to establish service prior to the date Tenant initially opens
for business.
I. Performance of Work by Landlord. The reasonable cost incurred by
Landlord in performing any work or modification on behalf of Tenant or which is
required as a result of Tenant's Work and/or other Improvements, shall be paid
for by Tenant immediately upon Tenant's receipt of an invoice.
J. Miscellaneous. Tenant shall install the following:
1. Internal communication, alarm, fire protection, or smoke detection
systems, as may be required by any Governmental Authority.
2. Elevators, dumbwaiters, chutes, conveyors, duct shafts, pneumatic tubes
and their shafts, doors, and other components, including electrical hook-up and
service, if any, from the electrical panel to said equipment.
3. Storefronts, Tenant's sign(s), show window display platforms, window
backs, interior finish in show windows, store fixtures, and furnishings.
4. Double-studded walls and sound insulation of the walls and ceilings, and
such other sound insulation measures as required by Landlord in its reasonable
discretion when, in the reasonable judgment of Landlord, Tenant's business
operations create sounds or noises that may disturb Landlord, other tenants,
patrons of other tenants, or the occupant of any space in the Shopping Center.
III. DESIGN CRITERIA.
A. Structural. Any alteration, additions or reinforcements to Landlord's
structure required to accommodate Tenant's Improvements shall be performed only
with Landlord's architect's and engineer's prior written approval, at Tenant's
expense. Tenant shall pay, upon receipt of invoice and without setoff or
deduction, any costs associated with the Landlord's consultants' review and
approval of Tenant's proposed alterations, additions or reinforcements to
Landlord's structure.
B. Roof.
1. There shall be no installation of radio or television antennas. Any
roof-top equipment shall be subject to the prior written approval of Landlord,
Landlord's architect and all appropriate Governmental Authorities. All roof
penetrations (which shall include, without limitation, equipment platforms,
curbs, and multiple pipe enclosures) and equipment locations required by Tenant
and approved by Landlord, Landlord's architect, and said Governmental
Authorities shall be at Tenant's expense and subject to the conditions of said
approval. At Landlord's option, all such work shall be engineered and installed
by Landlord's contractor in accordance with standard project details as provided
by Landlord's architect. Any roof screens or screening devices required by
Landlord, Landlord's architect, and/or said Governmental Authorities shall be
designed by Landlord's architect or roofing engineer and at Landlord's option
installed by Landlord's contractor at Tenant's expense. The costs of any work
performed by Landlord's contractor, at Tenant's expense, shall be competitive
with commensurate contractors serving the same trade area.
2. All flashing, counter-flashing, and roofing repairs shall conform to the
project roofing specifications. All such work shall be paid for by Tenant but
shall be performed by Landlord's roofing contractor. The costs of any work
performed by Landlord's contractor, at Tenant's expense, shall be competitive
with commensurate contractors serving the same trade area.
C. Storefronts.
1. Tenant shall strictly comply with the storefront design and construction
criteria that pertain to Tenant's Premises as set forth in the Tenant Package.
2. No storefront, part thereof, or swinging door shall project beyond the
Premises or into any Common Area, except as may be otherwise set forth in the
Tenant Package.
3. All storefront work, including sliding door tracks and housing boxes for
grilles, shall be supported at its head sections by a welded structural steel
framework that shall be securely attached, suspended and braced to the existing
building structure. Storefronts that project past the mall facia shall be
engineered and designed to be supported independently of the mall facia. Tenant
shall pay the cost incurred by Landlord in repairing any damage done to
Landlord's Work by the installation, construction, attachment or support of any
part of the storefront.
4. Other than windows, all storefront material shall be durable material
such as glazed tile, brick slate, terrazzo, stone or similar materials approved
by Landlord's architect. Plaster, drywall, and similar materials will not be
permitted.
5. All storefront construction and materials shall be weatherproof (if
required in the Tenant Package) and resistant to wear, fading, discoloration,
and decay. Any and all storefront construction and materials that in the sole
but commercially reasonable judgment of Landlord are faded, discolored, worn or
in disrepair shall be immediately, at Tenant's expense, be refinished, repaired
or replaced by Tenant to Landlord's reasonable satisfaction.
D. Floors. Tenant shall install and maintain carpeting and/or other quality
flooring materials, such as glazed or unglazed pavers or wood parquet in
Tenant's public areas. Vinyl composition tile or indoor/outdoor carpeting shall
not be used in Tenant's public areas. Tenant's storefront entry area shall have
flooring material identical in quality, color and pattern to the mall flooring
material, or, at Landlord's option, such other durable materials as may be
approved by Landlord's architect.
E. Ceiling.
1. The ceiling shall be concealed spline or acoustical T-bar with 24" x 24"
tegular tile with 3/8" revealed edge or drywall or plaster construction. Other
ceiling material finishes may be used subject to written approval by Landlord's
architect. Acoustical T-bar ceiling with standard 24" x 48" modules will only be
permitted in storage and nonpublic areas.
2. Tenant shall strictly comply with specifications of the maximum ceiling
height of the Premises set forth in the Tenant Package. Higher ceilings may be
allowed upon written approval of Landlord and Landlord's architect. Any
relocation of or modification to structure, piping, conduit and/or duct work
necessitated by Tenant's installation of a ceiling in excess of the height
limitation shall be at Tenant's expense. Access panels and/or catwalks above the
ceilings required to serve Tenant's sign equipment shall be installed at
Tenant's expense.
F. Electrical. All fluorescent or incandescent lighting fixtures in
Tenant's public areas, other than decorative fixtures, shall be recessed.
Fluorescent fixtures shall have parabolic lenses or diffusers; no acrylic lenses
shall be permitted in public areas. Bare lamp fluorescent or incandescent
fixtures may be used only in concealed areas and/or stock rooms.
G. Signs. All storefront signs shall be designed strictly in accordance
with the Tenant Package. Tenant acknowledges that the sign criteria have been
established for mutual benefit of all tenants in the Shopping Center. Any
nonconforming or unapproved signs shall be removed or brought into conformance
at the expense of Tenant.
IV. Tenant's Use of a Contractor.
A. Contractor Selection. Tenant may select any contractor for the
construction of Tenant's Improvements provided such contractor is bondable and
meets all licensing and insurance requirements established by Landlord in the
Tenant Package and all Governmental Authorities. Tenant shall provide Landlord
with a copy of the contract with its contractor prior to commencement of any
Improvements. and Landlord shall have the right to disapprove such contractor or
the contract on reasonable grounds. Tenant's contractor shall do or cause to be
done all Tenant's work except where this Exhibit or this Lease provides for
Landlord's contractor to do the same.
B. Special Conditions. Tenant shall incorporate into the contract with its
contractor the following items as "Special Conditions":
1. Prior to commencement of Tenant's Improvements, Tenant's contractor
shall provide Landlord with a construction schedule indicating the completion
dates of all phases of Tenant's Improvements.
2. Tenant's contractor shall diligently perform said work in a manner and
at times that do not impede or delay Landlord in the completion of the Premises
or any other portion of the Shopping Center. Any delays in the completion of the
Premises caused by Tenant's contractor shall not relieve Tenant of any
obligation under this Lease.
3. Tenant's contractor shall be responsible for the repair, replacement or
clean-up of any damage caused by Tenant's contractor to any other contractor's
work in any area of the Shopping Center.
4. Tenant's contractor shall provide written notice to Landlord or
Landlord's Shopping Center manager of any work to be done on weekends or other
than normal job hours, and Tenant agrees to pay all costs associated therewith.
5. Tenant and Tenant's contractor shall comply with all Legal Requirements
and all rules and regulations established by Landlord in the performance of
Tenant's Improvements.
6. Prior to commencement of construction, Tenant shall submit to Landlord
evidence of insurance for its contractor in accordance with the requirements set
forth in the Lease.
7. Tenant shall erect a barricade to separate the Premises from the
remainder of the Shopping Center prior to Tenant commencing construction of the
Premises. Such barricade shall be full height, constructed with studs and
drywall, sealed at the tops and sides, taped, and painted such color as Landlord
shall select.
8. Tenant's contractor or subcontractors shall not post signs on any part
of the Shopping Center or the Premises.
9. Prior to the commencement of Tenant's Improvements, Tenant shall provide
Landlord with a "labor and materials payment bond" in an amount equal to one
hundred percent (100%) of the aggregate price of all contracts for such work,
conditioned on Tenant's payment in full of all claims of mechanics' lien
claimants for such labor, services and/or materials supplied in the prosecution
of such work. Said payment bond shall name Landlord as a primary obligee, shall
be given by a sufficient surety that is reasonably satisfactory to Landlord, and
shall be in such form as Landlord shall approve in its reasonable discretion. In
addition, Tenant shall obtain, or cause its contractor to obtain, a "performance
bond" covering the faithful performance of the contract for the construction of
Tenant's Work. The performance bond shall be in an amount equal to the full
amount of the contract price, conditioned on the contractor's faithful
performance of the contract. Said performance bond shall name Landlord and
Tenant as co-obligees, shall be given by a sufficient surety that is reasonably
satisfactory to Landlord, and shall be in such form as Landlord shall approve in
its reasonable discretion.
V. Description Of Landlord's Work in the Event of Reconstruction.
A. General. "Landlord's Work" shall be limited to the performance of the
improvements described in this Section V and only to the extent such work is
required in connection with the Reconstruction of the Premises.
B. Structure. Landlord's architect shall design the building in which the
Premises are located. Said building shall be constructed and sprinklered in
accordance with the building code in effect in the jurisdiction where the
Shopping Center is located as of the time of the initial construction of the
Shopping Center. Construction of the building in which the Premises are located
shall not be less than Type V-N. Exterior walls shall be masonry, metal stud,
and plaster or such other material or materials as Landlord's architect shall
select.
C. Partitions. Landlord will provide Interior Demising Partitions and
Perimeter Demising Partitions; the demising partitions shall be of unfinished
masonry, concrete, metal or wood studs, at Landlord's option, sixteen inches
(16") on center to the underside of the structure above, or to a height as
required by Landlord. Where such partitions fall on structural column lines, at
structural braces or structural expansion joints, projections may occur. Where
desirable in Landlord's opinion, a vertical neutral strip will be located at the
storefront area between stores.
D. Floor. Concrete floor slabs within the interior of the Premises and in
any entranceways shall have a smooth finish. Such floor shall be on a single
plane without depressions or raised areas, but may, at Landlord's option, be
sloped.
E. Plumbing. Water service and sewer laterals shall be brought to a point
above or directly beneath the Premises.
F. Sprinklers. An automatic sprinkler system shall be installed in
accordance with Landlord's standard grid pattern and height that shall include
one (1) sprinkler head per one hundred (100) square feet of Floor Area of the
Premises.
H. Electrical. Landlord shall provide facilities for the delivery of
277/480 volt power to premises containing 1,000 square feet of Floor Area or
more, and 120/208 volt power to premises containing less than 1,000 square feet
of Floor Area, to a central distribution point. Pursuant to Landlord's criteria,
Landlord shall provide a main electrical switch at a master metered central
distribution point and an empty conduit from the central distribution point to
the Premises for electrical and telephone lines.
I. Air Conditioning. If at the time of the casualty resulting in
Reconstruction the Premises was served by a central Air Conditioning System
serving the Premises in common with other tenants in the Shopping Center,
Landlord shall provide the Air Conditioning System (subject to Section II,
Paragraph G of this Exhibit C). The Tenant Package shall detail the type,
design, and specifications of the Air Conditioning System provided by Landlord.
J. Miscellaneous. The exterior trim and other surfaces of the mall
buildings normally requiring painting shall be painted. Sidewalks adjacent to
the Premises shall be constructed of concrete or such other suitable material as
Landlord shall select.
EXHIBIT D
RULES AND REGULATIONS
Tenant will deposit its trash only in the Shopping Center trash receptacles
and shall participate in and comply with any reasonable procedures established
by Landlord or any procedures established by (or in compliance with) a
Governmental Authority for the collection, sorting, separation, and recycling of
waste products, garbage, refuse, and trash.
Tenant shall use its reasonable efforts to complete, or cause to be
completed, all deliveries, loading, unloading, and services to the Premises
prior to 10:00 a.m. of each day. Tenant shall attempt to prevent any delivery
trucks or other vehicles servicing the Premises from parking or standing in
front of, or at the rear of, the Premises from 10:00 a.m. to 9:00 p.m. of each
day.
Tenant shall not display, paint or place, or cause to be displayed, painted
or placed, any handbills, bumper stickers or other advertising devices on any
vehicle parked in the parking area of the Shopping Center, whether belonging to
Tenant, or to Tenant's agent, or to any other person, nor shall Tenant
distribute, or cause to be distributed, in the Shopping Center, any handbills or
other advertising devices.
Employees of Tenant shall not park their automobiles in those automobile
parking areas of the Common Area which Landlord may from time to time designate
for use by patrons of the Shopping Center.
Tenant and its employees shall park their cars only in those parking areas
designated by Landlord for employee parking. Tenant shall furnish Landlord with
the automobile license numbers of Tenant and Tenant's employees within fifteen
(15) days after taking possession of the Premises and shall thereafter notify
Landlord of any changes thereto within five (5) days after such change occurs.
If Tenant or its employees fail to park their cars in the designated parking
areas, Landlord may charge Tenant Ten Dollars ($10.00) per car per day for each
day or partial day that any car is parked in any area other than those
designated; provided, however, Landlord agrees to give Tenant written notice of
the first violation of this provision for each vehicle. Tenant shall have two
(2) days thereafter within which to correct the violation; if said violation is
not corrected within said two-day period, then the aforesaid fine shall be
levied and Tenant shall pay the same within ten (10) days of Landlord's request
therefor. After notice of such first violation, no prior notice of any
subsequent violation by the same vehicle shall be required.
Tenant shall not display or sell merchandise, or place carts, portable
signs, devices or any other objects in the Common Area and Tenant shall not
solicit or distribute materials in any manner in the Common Area.
Tenant shall utilize no medium which can be heard or experienced outside of
the Premises.
Tenant shall not erect an aerial or antenna on the roof or exterior walls
of the Premises.
EXHIBIT E
TENANT'S ESTOPPEL CERTIFICATE
Date: , 19
Address:
To whom it may concern:
The undersigned, as Tenant, has entered into that certain Lease, dated 19 ,
with , as Landlord, for the leasing of certain Premises at the Shopping Center
commonly known as . ----------------------------- --------
---------------------------- --------------------------------------
Tenant understands that you have offered or committed to enter into a
transaction with Landlord with respect to an interest in Landlord and/or the
Lease and/or the Premises and/or the realty underlying the Premises and/or a
portion of or interest in the realty or improvements in the Shopping Center
owned or hereafter acquired by Landlord. You have requested this Certificate
from Tenant as a condition precedent to consummation of one of the following
transactions: sale, purchase, exchange, transfer, assignment, lease, conveyance,
encumbrance, pledge, mortgage or hypothecation.
In accordance with the terms of the Lease, Tenant ratifies the Lease and
certifies that:
(1) The undersigned has accepted the Premises and entered into occupancy
(i.e. accepted possession) of the Premises described in said Lease on , 19 ;
(2) The undersigned is presently open and conducting business with the
public in the Premises;
(3) The current Minimum Annual Rent in the annual amount of $ was payable
from , 19 ;
(4) Said Lease is in full force and effect and has not been assigned,
modified, supplemented or amended in any way (except by agreement[s] dated ),
and ,to Tenant's knowledge, neither party thereto is in default thereunder;
(5) The Lease represents the entire agreement between the parties as to the
terms, covenants and conditions respecting the leasing of the Premises;;
(6) The Lease Term expires on , 19 ;
(7) All conditions under said Lease to be performed by Landlord have been
satisfied, including, without limitation, all co-tenancy requirements thereunder
except: ;
(8) All required contributions by Landlord to Tenant on account of Tenant's
improvements have been received;
(9) On this date there are no existing defenses, offsets, counterclaims or
deductions against rental that the undersigned has against the enforcement of
said Lease by Landlord except: ;
(10) No rental has been paid more than one (1) month in advance and no
security (other than a security deposit in the amount of $ ) has been deposited
with Landlord; and
(11) The Minimum Annual Rent through , 19 , has been paid.
(12) The operation and use of the Premises does not involve the generation,
treatment, transportation, storage, disposal or release of Hazardous Material(s)
or solid waste into the environment and that the Premises are being operated in
accordance with all applicable environmental laws, zoning ordinances and
building codes.
Very truly yours,
(Tenant)
By:
Title:
EXHIBIT F
MECHANICAL/ELECTRICAL SCHEDULE
1. Tenant Name Space No.
2. Tenant Drawing Nos. Mechanical Electrical
3. Floor Area (Sq. Ft.)
4. Electrical Load Breakdown
a. Lighting Xxxxx
b. Sign(s) Xxxxx
c. Appliances Xxxxx
d. Receptacles Xxxxx
e. Equipment Xxxxx
f. Electric Water Heater Xxxxx
g. Electric Heater Xxxxx
h. Miscellaneous Xxxxx
5. Total Connected Electrical Load Xxxxx: Xxxxx/Sq.Ft. of Floor
6. Tenant Calculated Design Heating Load BTUH
7. Tenant Calculated Design Cooling Load BTUH
8. Tenant Calculated Design Air Supply CFM (per Tenant plans)
9. Landlord Allotted Air Supply CFM
10. Additional Air Supply Required CFM
11. Variable Volume Air Terminal Units
a. Air CFM Xxx
x. Inlet/Outlet Sizes
12. Chilled Water Air Handler Units
a. Max GPM
13. Toilet Exhaust CFM
14. Special Exhaust/Make-up System(s) Data
(Use, CFM, HP, Method of Operation, Etc.)
15. Air Conditioning Unit Data (if Tenant is installing its own system.)
a. Make b. Model # c. CFM
EXHIBIT G
GUARANTY OF LEASE
WHEREAS, a certain Lease, more fully described below, has been or will be
executed:
a. Name of Shopping Center: THE OAKS
b. Landlord: THE OAKS SHOPPING CENTER, L.P.,
a California limited partnership
c. Tenant: TOYS INTERNATIONAL,
a California corporation
d. Premises Address: Space No. 1-M-006
000 X. Xxxxxxxxx Xxxxx
Xxxxxxxx Xxxx, XX 00000-0000
WHEREAS, the Landlord under said Lease requires as a condition to its
execution of said Lease that the undersigned (herein referred to as "Guarantor")
guarantee the full performance of the obligations of Tenant under said Lease.
WHEREAS, the undersigned is desirous that Landlord enter into said Lease
with Tenant.
NOW, THEREFORE, in consideration of the execution of said Lease by
Landlord, Guarantor hereby unconditionally guarantees the complete and timely
performance of each and all of the terms, covenants and conditions of said Lease
to be kept and performed by said Tenant, including the payment of all rentals
and other charges to accrue thereunder. Guarantor further agrees as follows:
1. That this Guaranty shall continue in favor of Landlord notwithstanding
any extension, modification, or alteration of said Lease entered into by and
between the parties thereto, or their successors or assigns, notwithstanding any
assignment of said Lease, with or without the consent of Landlord, and no
extension, modification, alteration or assignment of the above-referred to Lease
shall in any manner release or discharge Guarantor and it does hereby consent
thereto;
2. This Guaranty will continue unchanged by any bankruptcy, reorganization
or insolvency of Tenant or any successor or assignee thereof or by any
disaffirmance or abandonment by a trustee to Tenant;
3. Landlord may, without notice, assign this Guaranty in whole or in part
and no assignment or transfer of the Lease shall operate to extinguish or
diminish the liability of Guarantor hereunder;
4. The liability of Guarantor under this Guaranty shall be primary and, in
any right of action which shall accrue to Landlord under the Lease, Landlord
may, at its option, proceed against the undersigned without having commenced any
action or obtained any judgment against Tenant;
5. Guarantor shall pay Landlord's reasonable attorney fees and all costs
and other expenses incurred in any negotiations, action or proceeding commenced
to enforce this Guaranty;
6. Guarantor hereby waives notice of any demand by Landlord as well as of
any notice of Tenant's default in the payment of rent or any other amounts
contained or reserved in the Lease;
7. Guarantor hereby consents to personal jurisdiction and venue in the
state and judicial district in which the Shopping Center is located; and
8. The person or persons executing this Guaranty of Lease on behalf of
Guarantor represent, covenant, and warrant to Landlord as of the Effective Date
that the signatories signing on behalf of Guarantor have the requisite authority
to bind Guarantor. Further, if the Guarantor is a corporation, Guarantor
represents, covenants, and warrants to Landlord that: (a) as of the Effective
Date, Guarantor is a duly constituted corporation in good standing and qualified
to do business in the state where the Shopping Center is located, (b) Guarantor
has paid all applicable franchise and corporate taxes, and (c) Guarantor will
file when due all forms, reports, fees, and other documents necessary to comply
with applicable laws.
The use of the singular herein shall include the plural. The obligation of
two (2) or more parties shall be joint and several. The terms and provisions of
this Guaranty shall be binding upon and inure to the benefit of the respective
heirs, legal representatives, successors and assigns of the parties herein
named.
IN WITNESS WHEREOF, Guarantor has caused this Guaranty of Lease to be
executed as of the Effective Date of the above-mentioned Lease.
PLAY CO. TOYS & ENTERTAINMENT CORP.,
a Delaware corporation
By:
Name:
(Type or Print Name)
Title:
By:
Name:
(Type or Print Name)
Title: GUARANTOR
ADDRESS: 000 Xxxxxxxxx Xxxxx
Xxx Xxxxxx, XX 00000
(PLEASE NOTARIZE DOCUMENT BY COMPLETING THE ATTACHED ACKNOWLEDGMENT)
ACKNOWLEDGMENT
State of )ss.
County of )
On , before me (here insert name and title of the officer), personally
appeared , personally known to me (or proved to me on the basis of satisfactory
evidence) to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature (Seal)
