LEASE
Between
XXXXXX X. XXXX,
LANDLORD
and
CHICAGO PIZZA & BREWERY, INC.
Dated as of August 17, 1998
iii
TABLE OF CONTENTS
1. Leased Property 1
2. Nonexclusive Easement 1
3. Quiet Enjoyment 1
4. Landlord's Access 1
5. Commencement Date 1
6. Primary Term 1
7. Options 2
8. Lease Year; Lease Period 2
9. Rent 2
10. Gross Sales 3
11. Use 4
12. Compliance with Laws 4
13. Conduct of Business 5
14. Alterations 5
15. Tenant's Fixturization 5
16. Signs 5
17. Maintenance Obligations 5
18. Landlord's Right to Make Repairs 6
19. Utilities and Services 6
20. Personal Property Taxes and Assessments 6
21. Real Property Taxes and Assessments 6
22. No Apportionment 7
23. Right to Contest 7
24. Landlord Exculpation 7
25. Tenant's Indemnity 8
26. Tenant's Insurance 8
27. Certificates 8
28. Assignment or Subletting 9
29. Collection 9
30. Obligation to Repair 9
31. Eminent Domain 9
32. Events of Xxxxxxx 00
00. Landlord's Remedies 12
34. Default by Landlord 13
35. Mitigation 14
36. Interest Charges 14
37. Late Charges 14
38. Attornment 14
39. Tenant's Encumbrance of Leasehold 14
40. Arbitration 14
41. Sale of Premises 15
42. Surrender of Premises 15
43. Holding Over 15
44. Entire Agreement 16
45. Amendment 16
46. Notices 16
47. Governing Law 16
48. Plain Meaning 16
49. Other Construction 17
50. Time of Essence 17
51. Severability 17
52. Effect of Waiver 17
53. Counterparts 17
54. Broker Commission 17
55. Attorney's Fees 18
56. Force Majeure 18
57. Consent 18
58. Relationship of Parties 18
59. Successors 18
60. No Merger 18
Exhibits
A. Land Legal Description
B. HVAC Repairs Schedule
LEASE
This lease (LEASE), dated August 17, 1998 for reference purposes, is
made by and between XXXXXX X. XXXX, an individual as landlord (LANDLORD), and
CHICAGO PIZZA & BREWERY, INC., a California corporation, as tenant (TENANT),
who agree as follows:
1. Leased Property. Landlord leases to Tenant and Tenant leases
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from Landlord the following property at 0000 Xxxxxx Xxxxxx, Xxxxxxxx Xxxxx,
Xxxxxxxxxx (the PREMISES):
a. The tract of land (the LAND) consisting of approximately
six acres described in Exhibit A hereto.
b. The freestanding building consisting of approxi-mately 17,000
square feet of floor area (the BUILDING).
c. The appurtenances, easements, and rights of way now or
subsequently pertaining to the foregoing.
2. Nonexclusive Easement. Landlord grants to Tenant a nonexclusive
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easement for ingress and egress by pedestrian and vehicular traffic for
vehicle parking generally made available for such purposes.
3. Quiet Enjoyment. So long as Tenant is not in default under the
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terms of this Lease, Tenant will have full, quiet, and peaceful possession of
the Premises and all rights granted in this Lease without interference or
interruption.
4. Landlord's Access. Landlord will have the right to enter upon
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the Premises for the purpose of inspection or any other lawful purpose.
Landlord will exercise such right reasonably, upon reasonable notice, during
ordinary business hours, and in such manner as not to interfere unreasonably
with the business of Tenant.
5. Commencement Date. This Lease will be effective upon its
------------------
execution by both parties and Tenant's delivery to Landlord of a $15,833.33
security deposit. This Commencement Date shall be no later than October 1,
1998.
6. Primary Term. The base duration (PRIMARY TERM) of this Lease
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will be for a period of five (5) years beginning October 1, 1998. If the
Commencement Date is prior to October 1, 1998, the Primary Term will be
extended for the number of days between the Commencement Date and October 1,
1998.
7. Options.
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a. Exercise of Option. Tenant will have options to extend the
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duration of the Lease beyond the Primary Term for three consecutive, five-year
periods (OPTION PERIODS) on the same terms and conditions and provisions
contained in this Lease, by giving Landlord notice of the exercise of the
option at least 180 days prior to the expiration of the Primary Term or
then-current Option Period (NOTICE PERIODS). Tenant's exercise of an option
is conditioned upon the Lease being in effect without existing default during
the appli-cable Notice Period. Tenant cannot exercise a later option unless
each prior option to extend this Lease has been so exercised.
8. Lease Year; Lease Period.
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a. The term LEASE YEAR means a period of 12 consecutive full
calendar months beginning October 1. The first Lease Year will commence on
October 1, 1998.
b. The term LEASE PERIOD means a period of 30 consecutive full
calendar months beginning October 1. The first Lease Period will commence on
October 1, 1998.
9. Rent. Tenant will pay to Landlord, without deduction, setoff, or
----
prior notice or demand, except as otherwise provided in Section 14.c. herein,
Base Rent during the initial Lease Year and the greater of Base Rent or
Percentage Rent in subsequent Lease Years, as further set forth in this
Section 9.
a. Base Rent. The Base Rent during the initial Lease Period is
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the equivalent of $190,000 annually, payable in monthly install-ments of
$15,833.33, each, in advance, on or before the first day of each and every
calendar month.
b. Base Rent Adjustments. Beginning the first day of the first
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month of the Lease Period first subsequent to the initial Lease Period, the
Base Rent shall increase by the then-current Los Angeles-Anaheim-Riverside
Urban Wage Earners and Clerical Workers Consumer Price Index factor in effect
the last month of the initial Lease Period, and become the Lease Period Base
Rent. Notwithstanding the foregoing sentence, the increase shall be no less
than three percent (3%) and no greater than five percent (5%) of the prior
Lease Period Base Rent dollar amount. The Base Rent will increase from the
then-current Lease Period Base Rent in this manner at the beginning of each
subsequent Lease Period thereafter.
c. Percentage Rent. The Percentage Rent is six percent (6%) of
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Tenant's annual Gross Sales (as defined in Section 10 herein) for the
immediately expired Lease Year. The Percentage Rent is payable monthly in
twelve (12) equal installments, in advance, on or before the first day of each
and every calendar month.
d. Percentage Rent Adjustment Period. Notwith-standing Section
---------------------------------
9.c. above, Tenant shall have a maximum of thirty (30) calendar days after the
end of the immediately expired Lease Year in which to calculate the next Lease
Year Percentage Rent amount and pay to Landlord the difference, if any,
between the current Lease Year Percentage Rent and the next Lease Year
Percentage Rent due the first day of the first calendar month of the next
Lease Year.
10. Gross Sales.
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a. Definition. The term GROSS SALES means the gross selling price
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of all food, beverages, goods and services sold in or from the Premises by
Tenant, its permitted subtenants, licensees, or concessionaires, whether for
cash or on credit (whether collected or not), including the gross amount
received by reason of orders taken on the Premises although filled elsewhere,
and whether made by employees or vending machines. Gross Sales do not include
the following: (a) cash or credit refunds to customers; (b) goods returned to
sources; (c) refundable deposits and gift certificates or similar vouchers
except as converted into by a sale by redemption; (d) sales of fixtures,
machinery, equipment, or other property which are not for sale or trade in the
ordinary course of Tenant's business; (e) sums or credits received in
settlement of claims for loss or damage to Tenant's goods; (f) the value of
meals furnished to Tenant's employees; (g) allowances, complimentary meals,
coupons and discounts in the ordinary course of business to the extent there
is no payment therefor; (h) the value of food or services donated or sold, at
an amount not exceeding the approximate cost, for charitable purposes or
community functions, (i) sales of nonedible, self-liquidating promotional
items; (j) gratuities or service charges in lieu thereof given to Tenant's
employees; (k) taxes of whatever nature imposed on the sale of goods or
services; (l) Tenant's intercompany transfer of beer produced at the Premises.
b. Statement of Gross Sales. Tenant will furnish to Landlord
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statements of Gross Sales within 30 days after the close of each calendar
quarterly period during the Primary Term and the Option Period, and an annual
statement within 30 days after the close of each Lease Year.
c. Records. Tenant will keep full and accurate books, records,
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and other pertinent data which would normally be examined by an independent
accountant pursuant to generally accepted auditing standards in performing an
audit of Tenant's Gross Sales. All such books, records, and data will be
retained
and preserved for at lest 36 months after the end of the Lease Year to which
they relate.
d. Audit. Landlord is entitled, once during each Lease Year and
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once after expiration or termination of this Lease, to an independent audit by
an auditor designated by Landlord of Tenant's books, records and other
pertinent data to determine Tenant's Gross Sales. The audit may be at any
reasonable time upon at least 10 days' prior written notice to Tenant, will be
limited to the determination of Gross Sales, and will be conducted during
normal business hours at a mutually agreeable location. Tenant will promptly
pay to Landlord any deficiency or Landlord will promptly refund to Tenant any
overpayment, as the case may be, which is established by the audit. The costs
of the audit will be borne by Landlord unless the audit shows that Tenant
understated Gross Sales by more than 5% for the period examined, in which case
the costs will be borne by Tenant. Any previous understatements which have
been disclosed and paid by Tenant will be credited and thereby eliminated from
a subsequent determination of understatement.
11. Use. The Premises may be used for the operation of a
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restaurant/micro-brewery and any purposes incidental to such purpose, subject
to conditional use restrictions, if any, imposed by the City of Los Angeles
Office of Zoning Administration. Tenant will not use or permit the Premises
to be used for any other purpose without Landlord's consent.
12. Compliance with Laws.
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a. Landlord represents and warrants to Tenant that, to its
knowledge, on the date of delivery of possession of the Premises to Tenant,
the Premises will be in compliance with all laws then applicable, including
environmental laws and regulations, concerning the use, condition, and
occu-pancy of the Premises. Tenant will have no liability for compliance with
laws relating to hazardous materials or waste in, under, or about the Premises
unless the presence of the hazardous materials or waste was caused by Tenant
or Tenant's representa-tives, and Landlord will have the obligation to comply
with such laws at its cost and expense. Tenant will comply with all laws
concerning its use and the related condition and occupancy of the Premises
during the term within its reasonable control as a tenant, including but not
limited to conditions and or restrictions imposed by the City of Los Angeles
Office of Zoning Administration, and laws related to hazardous materials or
waste in, under, or about the Premises caused by Tenant or Tenant's
representatives.
b. Landlord and Tenant agree that either may, without cost or
expense to the other, and by appropriate proceedings diligently conducted in
good faith, contest the validity or application of any law or instrument of
record affecting the Premises, provided neither the other party nor the
Premises would be in any danger of civil or criminal liability or the filing
and fore-closure of any lien for noncompliance.
13. Conduct of Business. Tenant will conduct its business upon the
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Premises in accordance with its discretion as to the normal and customary
operation of its business and prudent business judgment. Tenant will not use
the Premises in any manner that will constitute waste, nuisance, or
unreasonable annoyance.
14. Alterations.
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a. Tenant will not make any alterations, additions, or
improvements (collectively, ALTERATIONS) to the Premises without the prior
written consent of Landlord, except that Tenant, at Tenant's sole cost and
expense, may make any nonstructural Alterations to the Premises which do not
diminish the then fair market value of the Premises without the prior, written
consent of Landlord if such Alterations are within the Premises and do not
materially alter, modify, or affect the outside aesthetics of the Building.
Upon termination of this Lease, all Alterations, whether temporary or
permanent in character, made in or upon the Premises by either Tenant or
Landlord shall become the property of Landlord.
b. Landlord will repair the heating/ventilation/air conditioning
system in accordance with Exhibit B hereto no later than October 1, 1998.
Tenant may enter the Premises before the Commencement Date to inspect the
system and the system repairs.
c. Landlord will contribute $25,000.00, in the form of an Rent
abatement of abatement of $2,083.33 per month during the initial Lease Year,
toward Tenant's Alterations and repairs to the restroom areas of the Premises.
15. Tenant's Fixturization. Tenant may, at Tenant's sole cost and
----------------------
expense, install in and affix to the Premises such furnishings, fixtures, and
equipment as Tenant deems desirable.
16. Signs. Tenant will have the right to erect and maintain upon the
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Premises any signs Tenant deems appropriate to the normal conduct of its
business, subject to compliance with applicable laws, including approvals
required by such laws. Landlord makes no representation with respect to the
availability of such approvals.
17. Maintenance Obligations. Subject to the pro-visions of this
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Lease concerning destruction and condemnation, Tenant will make all necessary
repairs and replacements causal to Tenant's use of, or conduct of business at,
the Premises to main-tain the Premises, including the heating/ventilation/air
conditioning system and the fire suppression system, in good order, condition,
and repair, reasonable wear and tear excepted. Landlord will make all
necessary repairs and replacements to main-tain the structural integrity of
the Premises, including the roof, electrical system, plumbing system, interior
sprinkler system and parking area.
18. Landlord's Right to Make Repairs. If Tenant fails to perform its
--------------------------------
maintenance obligations within 30 days after written notice from Landlord,
Landlord may perform such maintenance and Tenant will promptly reimburse
Landlord for its reasonable expenses after delivery of a statement reasonably
detailing such expenses. In the event of any life- or property-threatening
emergency, Landlord will have the immediate right to enter the Premises to
effect emergency repairs upon notice, reasonable under the circumstances, to
Tenant.
19. Utilities and Services. Tenant will pay the appro-priate
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suppliers for all water, electricity, gas, telephone, cable TV, and other
utility and communication services used by Tenant on the Premises during the
term. All such services will be separately metered and billed to Tenant.
20. Personal Property Taxes and Assessments. Tenant will pay all
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taxes levied and assessed against furnishings, fixtures, equipment, and other
personal property of Tenant kept upon the premises that become payable during
the term. The parties will seek to cause Tenant's personal property to be
assessed and billed separately from Landlord's real property. If Tenant's
personal property is assessed and taxed with Landlord's real property, Tenant
will pay Landlord the portion of such taxes attributable to Tenant's personal
property not later than 15 days prior to the date of delinquency or 30 days
after receipt of the billing from Landlord, whichever is later.
21. Real Property Taxes and Assessments.
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a. Obligation. Tenant will pay all Real Property Taxes (defined
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in (b) below) levied and assessed against the Premises not later than 15 days
prior to the December date of delinquency of the first installment or, if tax
bills are not sent directly to Tenant from the tax collector, 30 days after
receipt of the xxxx from Landlord, whichever is later.
b. Definition. The term REAL PROPERTY TAXES includes any form
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of real estate taxes, general or special assessments, and any license fee,
commercial rental tax, improvement bonds, levy, or tax imposed on the Premises
by any authority having the direct power to tax, including any city, county,
state or federal government or any school, fire, street, or other improvement
or assessment district of the governmental authority, as against (i) the legal
or equitable interest of Landlord in the Premises, (ii) Landlord's right to
rent or other income from the Premises, (iii) the act of entering into this
Lease, or (iv) the occupancy of the Premises by Tenant. If at any time during
the term the laws concerning Real Property Taxes are changed such that any
other governmental imposition, however described, including a so-called
value-added tax, is imposed on the Premises or Landlord as a direct
substitution, in whole or in part, for, or in addition to, any Real Property
Taxes, Tenant will pay such imposition in the same manner and Tenant's
allocation of liability for any such imposition will be substantially the same
as Tenant's allocation liability for Real Property Taxes as provided in this
Lease.
c. Exclusions. Notwithstanding (b) above, Tenant will have no
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obligation to pay (i) for penalties and interest other than those attributable
to Tenant's failure to comply timely with its payment obligations pursuant to
this Lease, or (ii) any tax which may be levied upon net income, profits, or
business of Landlord or any personal property taxes, gift, franchise,
inheritance, estate, succession, capital levy, or transfer taxes which may be
levied against any estate or interest of Landlord.
22. No Apportionment. There shall be no apportionment or prorating
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of any personal property taxes or Real Property Taxes according to the number
of days in the fiscal tax year which were included in the Lease term or
according to any other apportionment or prorating plan.
23. Right to Contest. Tenant, at its own expense, may contest by
----------------
appropriate proceedings the amount of such taxes required to be paid by Tenant
pursuant to this Article and Tenant may endeavor at any time or times by
appropriate proceedings to obtain a reduction in the assessed valuation of the
Premises for tax purposes, and in any such event Landlord agrees, at the
request of Tenant, to join with Tenant, at Tenant's expense, in the
proceedings and Landlord agrees to sign and deliver such papers and
instruments as may be necessary to prosecute such proceedings. Tenant will
have the right to contest the amount of any such tax and Tenant will have the
right to withhold payment of the tax if the statute under which Tenant is
contesting the tax so permits. In the event of any such contest, Tenant will
indemnify and hold Landlord harmless with respect to any cost, damage, or
expense, including attorneys fees, in connection with any such proceedings.
Tenant, upon final determination of such contest, will immediately pay and
discharge any judgment rendered against it, together with all costs and
incidental charges.
24. Landlord Exculpation. Landlord will not be liable to Tenant for
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any damage to Tenant or Tenant's property from any cause, and Tenant waives
all claims against Landlord for damage to person or property arising from any
reason, except Landlord's
negligence, willful misconduct, or any breach or default on Landlord's part
under this Lease.
25. Tenant's Indemnity. Tenant will defend, indemnify, and hold
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Landlord and its representatives harmless from and against any and all costs,
expenses (including attorney's fees and court costs), losses, liabilities,
damages, claims and demands of every kind or nature (collectively, LOSSES),
arising in any way from (a) alteration, use, or occupancy of the Building by
Tenant or any person claiming under Tenant, (b) the conduct of Tenant's
business and any activity, work, or thing done or permitted by Tenant in or
about the Building, (c) negligence or willful mis-conduct of Tenant or its
representatives, or (d) any breach or default on Tenant's part under this
Lease. Tenant's foregoing indemnity obligation will, however, exclude Losses
arising in any way from (a) the negligence or willful misconduct of Landlord
or its representatives, or (b) any breach or default on Landlord's part under
this Lease.
26. Tenant's Insurance. Tenant will, at all times after the delivery
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of the Premises to Tenant, carry at its expense:
a. Liability Insurance. Comprehensive general liability
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insurance providing bodily injury and property damage including
restaurant/liquor liability coverage in the amount of at least $1,000,000
combined single limit insuring against all legal liability (subject to usual
policy exclusions, terms and conditions) of Tenant and its representatives
arising out of the use, occupancy, or condition of the Premises. Such
insurance will name Landlord as an additional insured for the specified
amount. Tenant will have the right to effect all or any part of such
insurance by endorsement on any general liability insurance maintained by or
on behalf of Tenant or by a separate policy or policies of insurance.
b. Property Insurance. Insurance providing against loss or
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damage to Tenant's personal property, improvements, and Alterations in, on, or
about the Premises by (i) fire, (ii) perils included in the Extended Coverage
endorse-ment in common use for commercial structures, (iii) vandalism and
malicious mischief, and (iv) sprinkler leakage coverage, in an amount not less
than the full replacement value. The insurance policy will cover Tenant,
Landlord, and their lenders, as their interests may appear.
c. Worker's Compensation. Worker's compensation insurance as
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required by law.
27. Certificates. Tenant will deliver to Landlord, prior to delivery
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of possession of the Premises to Tenant, a certificate or certificates of
insurance evidencing the types of coverage, carriers, limits, self-insured
retentions, and effective dates of coverage. Each policy will provide not
less than 10 days' prior notice to Landlord of cancellation, non-renewal, or
material adverse modification of that insurance. Throughout the term of
this lease, Tenant will provide to Landlord current certificates or other
satisfactory evidence of renewal.
28. Assignment or Subletting. Tenant will not assign or sublet all
------------------------
or any portion of the Premises or Tenant's interest in this Lease without
Landlord's prior written consent, which Landlord shall not unreasonably
withhold. Except as Landlord may agree otherwise, Landlord's consent to any
assignment or sublease will neither waive the requirement of Landlord's
consent to any subsequent assignment or sublease nor release Tenant from
Tenant's payment and performance obligations in this Lease. Any assignment or
sublease requiring but lacking Landlord's prior, written consent will be void
at Landlord's option.
29. Collection. Any rental payments or other sums received by
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Landlord from Tenant or any other person in connection with Tenant's
obligations under this Lease will be conclusively presumed to have been paid
by Tenant or on Tenant's behalf.
30. Obligation to Repair. In the event of (a) the partial damage or
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destruction of the Building or (b) the Building being declared unfit or unsafe
for occupancy by any authorized public authority, and the event has a causal
relationship to Tenant's occupation and/or use of the Premises, Tenant will,
at its sole cost and expense, promptly commence and diligently prosecute to
completion such repairs as are necessary to permit the safe use and occupancy
of the Building; and Tenant will continue the operation of its business during
the period of repairs to the extent reasonably practicable. If the event has
no causal relationship to Tenant's occupation and/or use of the Premises,
Landlord will, at its sole cost and expense, promptly commence and diligently
prosecute to completion such repairs as are necessary to permit the safe use
and occupancy of the Building; and rent will be equitably reduced by Landlord,
based on the extent to which the damage or destruction interferes with
Tenant's use of the Premises, between the date of the damage or destruction
and the date of complete restoration; and Tenant will continue the operation
of its business during the period of repairs to the extent reasonably
practicable.
31. Eminent Domain.
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a. Definitions. The term TAKING includes (i) the acquisition of
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property through the exercise of any governmental power, by legal proceedings
or otherwise, by any public or quasi-public authority or private corporation
or individual in the exercise of eminent domain and (ii) the voluntary sale or
transfer under the threat of exercise of eminent domain. The term DATE OF
TAKING means the earlier of the date of taking of actual physical possession
by the condemning authority or the date of the condemning authority gives
notice that it is deemed to have taken possession. The term TOTAL TAKING
means a taking of so much of the Premises as, in Tenant's reasonable opinion,
to render the Premises to be unsuitable for Tenant's continued use. Reduction
in parking will not constitute a basis for a claim of total taking so long as
at least the minimum number of parking spaces for the Premises as required by
local building officials, counting standard and handicap spaces only, is
within reasonable proximity to the Premises and made available for Tenant's
use. The term PARTIAL TAKING means a taking of the Premises which does not
constitute a total taking. The term TEMPORARY TAKING means a taking for less
than 180 days.
b. Total Taking. If there is a total taking, this Lease will
------------
terminate on the date of taking. Unless within 60 days after the date the
nature and extent of the taking are finally determined Tenant notifies
Landlord that Tenant considers a taking of less than the entire Premises to be
a total taking, the taking will be deemed to be a partial taking.
c. Partial Taking. If there is a partial taking, this Lease
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will terminate as to the portion of the Premises taken and continue in full
force and effect as to the remainder of the Premises. Any rent paid prior to
the date of taking and attributable to a period after the date of taking with
respect to the portion of the Premises taken will be promptly returned to
Tenant by Landlord. Rent after a partial taking will be equitably reduced by
Landlord based on the extent to which the taking, including restoration
activity, interferes with Tenant's business on the Premises. Landlord will
promptly, after Tenant's loss of use of any of the Premises, make all
necessary repairs or alterations to make the remaining Premises a complete
architectural element.
d. Temporary Taking. If there is a temporary taking, this Lease
----------------
will not terminate but rent will be equitably reduced by Landlord based on the
extent to which the taking interferes with Tenant's business in the Premises.
e. Award. In the event of any taking, Landlord and Tenant may
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separately pursue their claims against the condemning authority. Tenant will
be entitled to receive, and Landlord will have no right to pursue for itself,
any award for claims based on (i) the adjusted book value (deemed to be the
amortized or depre-ciated value for book purposes) of construction of the
Alterations to the extent not reimbursed by Landlord, (ii) loss of or damage
to Tenant's personal property, (iii) loss to Tenant because of interruption of
business, (iv) Tenant's loss of good-will, (v) Tenant's cost of removal and
relocation, and (vi) the value attributable to any leasehold value for the
difference between the market value of the Premises (exclusive of items for
which Tenant is compensated under this Section) for the remainder of the term
above the value, at the date of taking, of the rent payable for the remainder
of the term. Tenant will have no right to pursue a claim based upon the
residual value of the Land after expiration of the term or pursue claims or
retain any award to which Landlord is entitled so as inequitably to diminish
Landlord's award.
f. Notice to Tenant. After Landlord has knowledge of the
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intention of any authority to effect a taking, Landlord will promptly give
notice of such to Tenant.
32. Events of Default. The occurrence of any of the following will
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constitute a default by Tenant:
a. Nonpayment of Rent. Failure by Tenant to pay rent when due
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if the failure continues for 10 days after notice has been given to Tenant
that the rent is delinquent.
b. Other Obligations. Failure by Tenant to perform any
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provision of this Lease required of it other than (a) above if the failure is
not cured within 30 days after notice has been given to Tenant. If the
failure cannot reasonably be cured within the cure period, Tenant will not be
in default of this Lease if Tenant commences to cure the failure within the
cure period and diligently and in good faith continues to cure the failure.
c. General Assignment. A general assignment for the benefit of
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creditors by Tenant.
d. Bankruptcy. Petition to have Tenant adjudicated a bankrupt,
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or a petition for reorganization or arrangement under the federal bankruptcy
laws is filed by Tenant or against Tenant and is not dismissed within 60 days
from the date of such filing.
e. Receivership. The assumption of the assets of Tenant or of
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the business conducted by Tenant on the Premises by a trustee, receiver, or
other person where possession is not restored to Tenant within 30 days.
f. Attachment. The attachment, execution, or other judicial
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seizure of substantially all of Tenant's assets located at the Premises or
Tenant's interest in the Lease, where such seizure is not discharged within 30
days.
g. Insolvency. The written admission by Tenant of its inability
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to pay is debts as they become due.
Notices given under this Section will (i) specify the alleged breach
and the applicable Lease provisions and (ii) demand that Tenant perform the
provisions of this Lease or pay the rent that is delinquent, as the case may
be, within the applicable period of time or quit the Premises. No such notice
will be deemed a forfeiture or a termination of this Lease unless Landlord so
elects in the notice. The purpose of the notice requirements in this Section
is to extend the notice requirements of the unlawful detainer statutes. Such
notice will, however, be in lieu of, and not in addition to, any notice
required under the unlawful detainer statutes.
33. Landlord's Remedies. Landlord will have the following remedies
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if Tenant commits a default. These remedies are not exclusive; they are
cumulative in addition to any remedies now or later allowed by law.
a. Recover Possession. Landlord can terminate Tenant's right to
------------------
possession of the Premises at any time as provided in unlawful detainer
statutes. No act by Landlord other than giving notice to Tenant will
terminate this Lease. Acts of maintenance, efforts to relet the Premises, or
the appointment of a receiver on Landlord's initiative to protect Landlord's
interest under this Lease will not constitute a termination of Tenant's right
to possession. On termination, Landlord has the right to recover from Tenant:
(i) The worth, at the time of the award, of the unpaid rent
that had been earned at the time of termination of this Lease.
(ii) The worth, at the time of the award, of the amount by
which the unpaid rent that would have been earned after the date of
termination of this Lease until the time of award exceeds the amount of the
loss of rent that Tenant proves could have been reasonably avoided.
(iii) The worth, at the time of the award, of the amount by
which unpaid rent for the balance of the term after the time of award exceeds
the amount of the loss of rent that Tenant proves could have been reasonably
avoided.
(iv) Any other amount, including court costs, necessary to
compensate Landlord for all detriment proximately caused by Tenant's default.
The phrase WORTH AT THE TIME OF THE AWARD as used in (i) and
(ii) above is to be computed by allowing interest at the prime commercial rate
plus 2% per annum, but not to exceed the then legal rate of interest. The
same phrase used in (iii) above is to be computed by discounting the amount at
the discount rate of the Federal Reserve Bank of San Francisco at the time of
the award, plus 1%.
b. Continuation of Lease. Landlord can continue this Lease in
---------------------
full force and effect, and the Lease will continue in effect as long as
Landlord does not terminate Tenant's right to possession, and Landlord will
have the right to collect rent when due. During the periods Tenant is in
default, Landlord can enter the Premises and relet them, or any part of them,
to third parties for Tenant's account. Tenant will be liable immediately to
Landlord for all costs reasonably incurred by Landlord in reletting the
Premises, including brokers' commissions, expenses of repairing the Premises
required by the reletting, and like costs. Reletting can be for a period
shorter or longer than the remaining term of the Lease. Tenant will pay to
Landlord the rent due under this Lease on the dates the rent is due, less the
rent Landlord receives from any reletting. No act by Landlord allowed by this
Section will terminate this Lease unless Landlord notifies Tenant that
Landlord elects to terminate this Lease. After Tenant's default and for as
long as Landlord does not terminate Tenant's right to possession of the
Premises, if Tenant obtains Landlord's consent, which Landlord will not
unreasonably withhold, Tenant will have the right to assign or sublet its
interest in this Lease, but Tenant will not be released from liability. If
Landlord elects to relet the premises as provided in this Section, rent that
Landlord received from reletting will be applied to the payment of first, any
indebtedness from Tenant to Landlord other than rent due from Tenant; second,
all costs, including for maintenance other than reasonable wear and tear,
incurred by Landlord in reletting; and third, rent due and unpaid under the
Lease. After deducting the payments referred to in this Section, any sum
remaining from the rent Landlord receives from reletting will be held by
Landlord and applied in payment of future rent as rent becomes due under this
Lease. In no event will Tenant be entitled to any excess rent received by
Landlord. If, on the date rent is due under this Lease, the rent received
from the reletting is less than the rent due on that date, Tenant will pay to
Landlord, in addition to the remaining rent due, all costs, including for
maintenance other than reasonable wear and tear, Landlord incurred in
reletting which remain unpaid after applying the rent received from the
reletting.
c. Right to Remedy. Landlord may, after expiration of Tenant's
---------------
cure period in Section 32(b) unless there is an emergency, correct or remedy
any failure of Tenant not timely cured. The reasonable cost paid by Landlord
to correct or remedy any such default will immediately become due and payable
to Landlord as additional rent.
34. Default by Landlord. Landlord will commit a default if Landlord
-------------------
fails to perform any provision of this Lease required of it and the failure is
not cured within a reasonable time not to exceed 30 days after notice has been
given to Landlord. If, however, the failure cannot reasonably be cured within
the cure period, Landlord will not be in default of this Lease if Landlord
commences to cure the failure within the cure period and diligently and in
good faith continues to cure the failure. Notices given under this Section
will specify the alleged breach and the applicable Lease provisions. Tenant
may, after expiration of the cure period unless there is an emergency, correct
or remedy any failure of Landlord not timely cured and the reasonable cost
paid by Tenant will immediately become due and payable to Tenant by Landlord.
35. Mitigation. Landlord and Tenant will each exercise best efforts
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to mitigate the damages caused by the other party's breach of this Lease.
Efforts to mitigate damages will not be construed as a waiver of the
nonbreaching party's right to recover damages.
36. Interest Charges. Any amount not paid by one party to the other
----------------
when due to the other party will bear interest from the date due at the lesser
of (a) the prime commercial rate in effect on the date due plus 2% per annum
or (b) the maximum rate permitted by law.
37. Late Charges. If either party fails to pay any amount due to the
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other within 10 days after notice that the amount is delinquent, the
delinquent party will pay to the other party as a late charge and in
consideration of the additional costs and record keeping incurred or required
by the other, a sum equal to 1% of the amount due.
38. Attornment. Tenant will attorn to the successor in interest of
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Landlord following any transfer of such interest, either voluntarily or by
operation of law, and recognize such successor as Landlord under this Lease.
Tenant will execute any documents reasonably required to accomplish the
purpose of this Section.
39. Tenant's Encumbrance of Leasehold. Tenant may at any time
----------------------------------
encumber its leasehold interest without the consent of Landlord, but no such
encumbrance will constitute a lien on Landlord's estate.
40. Arbitration.
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a. Submission to Arbitration. Any disputes which arise between
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Landlord and Tenant under this Lease with respect to prorations and adjustment
of Rent in Sections 30, 31(c), and 31(d) will be subject to final binding
arbitration upon written request by either party in accordance with this
Section 40.
b. Procedure. The dispute will be submitted before the
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American Arbitration Association (AAA) within 30 days after the requesting
notice in accordance with the Commercial Rules of the AAA as modified by this
Section; a decision will be issued within 30 days after the close of the
record; and judgment upon the award may be entered in any court having
jurisdiction over the judgment. The substantive law of the State of
California will be applied by the arbitrator, and this requirement will be
deemed jurisdictional. This arbitration provision will be deemed
self-executing. If either party fails to appear at any properly noticed
arbitration proceeding, an award may be entered against such party
notwithstanding such failure to appear. If either party makes demand upon the
other for arbitration, the arbi-tration will be conducted by an arbitrator
mutually agreed upon by the parties at the AAA offices nearest to the Premises
or at another location mutually agreeable to the parties. The expenses,
wages, and other compensation of any witnesses called before the arbitrator
will be borne by the party calling the witnesses. Other expenses incurred,
including wages of partici-pants and preparation of briefs and data to be
presented to the arbitrator, will be borne separately by the respective
parties. The fee for the arbitration, the arbitrator's fees and expenses, the
cost of any hearing room, and the cost of transcript recording and production
will be borne equally by Landlord and Tenant.
41. Sale of Premises. If Landlord sells or otherwise transfers all
----------------
of its interest in the Premises, excluding a transfer for security purposes
only, Landlord will be relieved of all liability accruing after the
consummation of the transfer under the Lease on the part of Landlord for acts,
occurrences, or omissions which occur after the consummation of the transfer
if the transferee has assumed Landlord's obligations under the Lease.
Landlord grants Tenant right of first refusal if Landlord sells or otherwise
transfers all of its interest in the Premises.
42. Surrender of Premises. Upon termination of this Lease, Tenant
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will surrender the Premises to Landlord in good and clean condition, ordinary
wear and tear and damage not required to be repaired excepted. All
alterations, additions, structural fixtures and improvements, whether
temporary or permanent in character, made in or upon the Premises by either
Tenant or Landlord shall become the property of Landlord. Tenant will remove
its personal property and may remove or reasonably alter or obliterate
evidence of its trademarks and distinctive trade dress. Tenant will
immediately correct any damage arising from its removal activity.
43. Holding Over. Any holding over after the expiration of this
------------
Lease without Landlord's consent will be construed as a month-to-month tenancy
at the Rent specified in this Lease plus 10% of the Rent and otherwise upon
the terms and con-ditions specified in this Lease, so far as applicable.
Nothing in this Section will be construed as Landlord's consent for Tenant to
hold over.
44. Entire Agreement. This Lease constitutes the entire agreement
----------------
between the parties on the subject matter of this Lease and supersedes any
prior negotiation, understanding, representa-tion, or agreement.
45. Amendment. This Lease may be amended only by a written
---------
instrument signed by both parties.
46. Notices. Any notice required or permitted by this Lease will be
-------
in writing and will be deemed given if delivered personally, by registered or
certified mail, delivery service or facsimile, if confirmed by the recipient,
addressed as follows:
To Landlord: Xxxxxx X. Xxxx
c/o Xxxxx X. Xxxxx
Elixir Industries
00000 X. Xxxxxxxx
Xxxxxxx, XX 00000
FAX: 000-000-0000
To Tenant: Chicago Pizza & Brewery, Inc.
Attn: Xxxx X. Xxxxxxx or
Xxxxx X. Xxxxxxxx
00000 Xxxxxxxxxx Xxxxxxx, Xxxxx X
Xxxxxxx Xxxxx, XX 00000
FAX: _____________________
Either party, by written notice, may change the place for future notices.
Each recipient must have a street address for notice purposes.
47. Governing Law. This Lease is to be construed in accordance with
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the laws of the State of California.
48. Plain Meaning. Unless defined otherwise, the words used in this
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Lease will be construed according to their plain meaning in the English
language. The word WILL is used as a command. The word INCLUDING is used in
a nonexclusive sense. The word LAW includes federal, state and local
constitutions, statutes, orders, writs, injunction, decrees, ordinances,
requirements, laws, rules, and regulations. The word TERMINATION is used in
an all-inclusive sense to include the concepts of the expiration of this
Lease by lapse of time, recision and ending by reason of default. The word
TRANSFER is used in an all-inclusive sense to include each and every manner of
disposing of any interest in or rights, privileges or obligations under any
part of this Lease, including any sale, gift or assignment. The word NOTICE
means notices, demands, and other similar communi-cations. The term RENT
means rent and all other sums required to be paid by Tenant pursuant to the
terms of this Lease. The term REPRESENTATIVE means officers, directors,
partners, employees, agents, and authorized contractors of a party when acting
in such capacity. If any provision of this 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 will have the
meaning that renders it valid.
49. Other Construction. The titles of the various sections of this
------------------
Lease are inserted for convenience and will not be deemed to affect the
meaning or construction of this Lease. The singular includes the plural and
vice-versa, and the masculine includes the feminine and neuter, whenever the
context so requires.
50. Time of Essence. Time is of the essence for each provision of
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this Lease.
51. Severability. Nothing in this Lease will be construed as
------------
requiring the commission of any act contrary to law. If there is any conflict
between any provision of this Lease and any present or future law, such
provision will be limited only to the extent necessary to bring it within the
requirement of the law. If any part of this Lease is held to be indefinite,
invalid, or otherwise unenforceable, the balance of this Lease will continue
in full force and effect. If any arbitrator or court of competent
jurisdiction finds any provision of this Lease unreasonable, the arbitrator or
court may declare a reasonable modification of the provision. This Lease will
be valid and enforceable and the parties agree to be bound by and perform it.
52. Effect of Waiver. The failure of either party to exercise any
----------------
power reserved to it by this Lease or to insist on strict compliance by the
other party with any obligation or con-dition under the Lease, and no custom
or practice of the parties at variance with the terms of the Lease, will
constitute a waiver of the party's right to demand exact compliance thereafter
with each term of this Lease. Waiver by either party of any default by the
other will not affect or impair the waiving party's rights with respect to any
other default of a like, similar, or dif-ferent nature. Any delay,
forbearance, or omission of a party to exercise any power or right arising out
of any default by the other of any provision of this Lease will not affect or
impair the party's rights to declare any subsequent default and to terminate
this Lease.
53. Counterparts. This Lease may be executed in any number of
------------
counterparts, each of which will be deemed to be an original and all of which
together will be deemed to be one and the same instrument.
54. Broker Commission. In consideration of the exclusive efforts and
-----------------
services rendered by Xxx Spilkey & Associates (BROKER) in connection with
this Lease, Landlord will pay Broker a commission of $9,500 on the
Commencement Date. Additionally, Landlord will pay a commission of $9,500 on
each of the next four successive Commencement Date anniversary dates, unless
at any time during the first four years of this Lease Tenant defaults under
Section 32 of this Lease and fails to cure the default within its time
constraints under Section 32 herein, in which case Broker forfeits any unpaid
commission otherwise due Broker by Landlord.
55. Attorney's Fees. If any action or proceeding is necessary to
---------------
enforce the provisions of this Lease, including any claim or demand or
declaratory relief action to interpret this Lease, the prevailing party will
be entitled to reasonable attorney's fees, costs, and necessary disbursements,
as may be fixed by the court having jurisdiction over the matter, in addition
to any other relief to which it may otherwise be entitled.
56. Force Majeure. Except for payment obligations imposed pursuant
-------------
to this Lease, if there is any prevention, delay, or stoppage of an act
required of a party pursuant to this Lease because of strikes, lockouts, other
labor disputes, material shortages, embargoes, civil unrest, governmental
regulations, governmental controls, enemy or hostile governmental action,
judicial order, public emergency, fire, earthquake, other Acts of God, and
other causes beyond the reasonable control of the party obligated to perform,
performance of the act will be excused for the period of the delay.
57. Consent. Whenever the consent or approval of either party is
-------
required pursuant to this Lease, such consent or approval will not be
unreasonably withheld or delayed.
58. Relationship of Parties. This Lease is not intended to create
-----------------------
any relation-ship of partnership, joint venture, principal-and-agent, or
otherwise than the relationship of landlord and tenant.
59. Successors. This Lease will be binding on and inure to the
----------
benefit of the parties and their successors and assigns, subject to the
restrictions as to assignment pursuant to this Lease.
60. No Merger. The surrender of this Lease by Tenant, the mutual
---------
cancellation of this Lease by agreement, or the termination of this Lease on
account of Tenant's default, will not work a merger and will, at Landlord's
option, terminate any sub-tenancies or operate as an assignment of any such
subtenancies to Landlord.
The undersigned parties have caused this Lease to be signed on the
respective dates set forth below.
LANDLORD: XXXXXX X. XXXX
\s\ Xxxxxx X. Xxxx
-----------------------------------
Xxxxxx X. Xxxx
Date: 9/8/98
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TENANT: CHICAGO PIZZA & BREWERY, INC.
By: \s\ Xxxx X. Xxxxxxx
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Its: CEO
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Date: 9/14/98
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LMPROJ02/LEASERRS.981/980807/LM/TWG
EXHIBIT A
LAND LEGAL DESCRIPTION
PARCEL A, in the City of Los Angeles, in the County of Los Angeles, State of
California, as shown on Parcel Map L.A. No. 2920, filed in Book 58, Page 23 of
Parcel Maps, in the office of the County Recorder of said County.
EXHIBIT B
HVAC REPAIRS SCHEDULE
July 29,1998
Elixir
Gardena, CA
Dear Xxxx:
Following is a breakdown on repair costs at 1'rcs'LdeLite:
a. North Dining Room
Rcplace One (1) compressor - leak check one (1) circuit and repair. Replace
belts, clean cyap and change filters. Cleaii fumar;c. Approximately
$7,200.00.
South Dining Room
el
Lcak chcck both circuits and repair. Rcplaoc filters. Clean evap aiid
furnace. Approximately $975.00.
Bar Do
Replace one (1) compressor and two (2) condenser fan motors. Replace filters
and belts. Clean evap coil and furnace. Approximately $8,200-00.
b. Upstairs Dining Room
Must find access to unit for @er inspection.
Bar Swamp Cooler
Clean out cooler and inspect furnacc. Change pads on cooler, $425.00.
Kitchen Exhausts
Change belts, $200.00.
I-Kitchen Makeup Air
II-Clean out coolcts. Change pads and belts, S550.00.
Sincerely.
Xxxx QuackenbiLch
Service Manger
BQ/am